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On March 20, the 9th U.S. Circuit Court of Appeals, in the case Rio Properties v. Rio International Interlink, upheld the validity of service of legal process by e-mail. Thus, defendants who seek to evade service of process by moving geographically from place to place may be nailed by a simple mouse click. CASE BACKGROUND Las Vegas hotel and casino operator Rio Properties (RIO) sued Rio International Interlink (RII), a foreign Internet business entity, for trademark infringement. RIO had registered the domain name playrio.com. At that domain, RIO operates a Web site with information about its hotel and casino and allows potential guests to make reservations. RII is a Costa Rican entity that participates in an Internet sports gambling operation. RII created a Web site using the domain riosports.com. RIO demanded that RII stop using the domain riosports.com, arguing trademark infringement. Thereafter, RII activated a Web site at betrio.com. Unhappy with this turn of events, RIO initiated litigation. RIO attempted to effectuate service of its summons and complaint in various traditional ways, such as by courier and by mail. But RII proved geographically elusive. Unable to serve RII by conventional means, RIO filed an emergency motion with the trial court for alternate service of process. The court granted the motion, and permitted service by e-mail to [email protected] RII subsequently appealed the sufficiency of this manner of service of process. UPHOLDING E-MAIL SERVICE The 9th Circuit affirmed the decision of the trial court allowing service by e-mail. In so ruling, the 9th Circuit held that “RIO need not have attempted every permissible means of service of process before petitioning the court for alternative relief.” Instead, “RIO needed only to demonstrate the facts and circumstances of the present case necessitated the [trial] court’s intervention.” Accordingly, “when RIO presented the [trial] court with its inability to serve an elusive international defendant, striving to evade service of process, the [trial] court properly exercised its discretionary powers to craft alternate means of service.” In upholding service of process on RII by e-mail to [email protected], the 9th Circuit acknowledged that “we tread on untrodden ground.” Specifically, the 9th Circuit noted that the parties had not presented any legal “authority condoning service of process over the Internet or via email.” Still, “although communication via email over the Internet is comparatively new, such communication has been zealously embraced within the business community.” Indeed, as pointed out by the 9th Circuit, “RII particularly has embraced the modern e-business model and profited immensely from it.” Significantly, “RII structured its business such that it could be contacted only via its email address,” as it did not provide an easily discoverable address anywhere. Under these circumstances, RII seems hard-pressed to complain about service by e-mail. As stated by the 9th Circuit: “when faced with an international e-business scofflaw, playing hide-and-seek with the federal court, email may be the only means of effecting service of process.” NEGATIVE ASPECTS OF E-MAIL SERVICE While e-mail service may have been appropriate in this particular case, the courts must be careful not to paint with too broad a brush. The 9th Circuit noted particular limitations, such as: a) there is no reliable way to confirm receipt of e-mail messages; b) limited use of electronic signatures could raise verification problems under the federal rules of procedure; c) system compatibility problems could lead to controversies as to whether attached documents actually were received; and d) imprecise imaging technology could make appending exhibits difficult in certain instances. BALANCING Thus, whether e-mail service of process is appropriate really will need to be decided on a case-by-case basis. A careful balancing of factors will need to be performed by the courts. Eric J. Sinrod is a partner in the San Francisco office of Duane Morris, where he focuses on technology and litigation matters. His Web site is sinrodlaw.com and his firm’s site is Duane Morris.Sinrod may be reached by e-mail at [email protected]

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