UNITED STATES COURT OF APPEALS FOR THE D.C. CIRCUIT


GTE NEW MEDIA SVC

v.

BELLSOUTH CORP


99-7097a

D.C. Cir. 2000


*	*	*


Edwards, Chief Judge: The matter at hand involves an  interlocutory
appeal brought pursuant to 28 U.S.C. s 1292(b).  The issues presented
are whether the District Court may  assert personal jurisdiction over
the defendants and whether  venue is proper in the District of
Columbia ("District") when  the defendants' sole contact with this
forum is the operation  of Internet websites that are accessible to
persons in the  District. The District Court tentatively concluded
that the  quality and nature of the websites militated in favor of 
personal jurisdiction. The trial judge noted, however, that  "[a]ll of
the interactive website cases reviewed [by the Dis- trict Court]
involved defendants with at least some physical  contact with the
forum," whereas the defendants in this case  have no physical contact
with the forum. GTE New Media  Servs., Inc. v. Ameritech Corp., Order
Certifying for Interloc- utory Appeal the Court's Ruling That Personal
Jurisdiction  Exists and Staying Proceedings at 3, reprinted in J.A.
218.  Given the unusual circumstances of this case, the District 
Court determined that the questions of personal jurisdiction  and
venue should be certified for immediate review by this  court.


The underlying action in this case rests on a complaint by  GTE Media
Services, Inc. ("GTE") against various defen- dants, including
BellSouth Corp., BellSouth Enterprises, Inc.,  BellSouth Advertising &
Publishing Corp., Intelligent Media  Ventures, Inc., SBC
Communications Inc., Pacific Telesis  Group, Pacific Bell Interactive
Media, US West, Inc., and US  West Media Group, for alleged violations
of Sections 1 and 2  of the Sherman Antitrust Act. GTE contends that
the defen- dants engaged in a conspiracy with an illicit purpose to 
dominate the Internet business directories' market. The  defendants,
in turn, moved to dismiss the complaint for want  of personal
jurisdiction. The defendants argue that the mere  ability of District
residents to access the defendants' Internet 


Yellow Pages from locations within the city is insufficient to 
establish personal jurisdiction.


GTE contends that the action, tortious injury, and "persis- tent course
of conduct" required under the District's long-arm  statute are
established, because the defendants have entered  into an agreement
outside of the District with a purpose of  causing Internet users in
the District to use the defendants'  Internet links to pursue business
leads in the District. In  other words, GTE asserts that the alleged
conspiracy was  designed to cause Internet users who otherwise would
have  had access to GTE's links to be diverted to the defendants' 
links, which in turn resulted in more advertising revenue for  the
defendants. GTE argues, in the alternative, that Section  12 of the
Clayton Act provides an independent basis for  personal


On the record at hand, we hold that the District Court  erred in
concluding that there is sufficient evidence here to  support personal
jurisdiction. And GTE's tortured interpre- tation of Section 12 of the
Clayton Act cannot save the day.  However, at this juncture of the
case, GTE is still free to  supplement the record through
jurisdictional discovery. The  case is hereby remanded to the District
Court for further  proceedings, including additional discovery and
possible  amendments to the complaint, should that be deemed war-
ranted. We decline to pass upon the District Court's theory  of
jurisdiction, which is premised on the supposed existence of  certain
facts to show substantial effects, when we have no  way of knowing
whether there are indeed facts to support the  asserted theory. And we
reject GTE's theory of jurisdiction,  which appears to rest on a view
that mere accessibility to an  Internet site in the District is enough
of a foundation upon  which to base personal jurisdiction.


I. Background


The relevant facts are relatively simple. GTE alleges that  in July
1997, five regional Bell operating companies (Ameri- tech Corp., Bell
Atlantic, BellSouth, SBC Corp., US West)  and their relevant
subsidiaries conspired to capture, control, 


and dominate the Internet business directories' market. See  GTE New
Media Servs. Inc. v. Ameritech Corp., 97-CV-2314,  Mem. Op. at 5-6,
reprinted in Joint Appendix ("J.A.") 185-86.  After the alleged
conspirators held meetings in California,  Colorado, Georgia, and
Michigan, they agreed to provide  jointly a coded map of the United
States that would allow  users of their Internet Yellow Pages to
access particular  states and particular businesses. Each of the
regional Bell  operating companies would provide exclusive service to
a  particular region, and the other companies apparently agreed  not
to compete with the designated exclusive server in its  given region.
The regions designated to each regional Bell  operating company
corresponded to the region to which the  company provided
telecommunications service. See id. at 5,  reprinted in J.A. 185. The
regional Bell operating compa- nies' next step was to obtain exclusive
links for their map on  well-known Internet browser sites run by
Netscape Commu- nications Corp. ("Netscape") and Yahoo, Inc!
("Yahoo"), to  ensure that users of these popular sites would be
specifically  directed to the operating companies' Internet Yellow


Before the alleged conspiracy, GTE had a non-exclusive  contract with
Netscape, pursuant to which Netscape offered a  choice of Internet
business directories on its site, including  GTE's SuperPages. See id.
at 7, reprinted in J.A. 187.  When users accessed the "Yellow Pages"
option on Net- scape's toolbar, they had access to GTE's website. GTE 
asserts, however, that Netscape terminated this arrangement  on July
18, 1997, by removing its links to GTE's SuperPages,  including
hyperlinks on Yahoo.


On October 6, 1997, GTE filed its complaint against the five  regional
Bell operating companies, Netscape, and Yahoo,  claiming, among other
things, violations of Sections 1 and 2 of  the Sherman Antitrust Act.
Several defendants (i.e., Bell- South, SBC Corp. and US West,
excepting US West Dex,  Inc.) moved to dismiss the complaint for lack
of personal  jurisdiction; two (i.e., BellSouth and SBC Corp.) also
argued  that venue was improper in the District of Columbia. On 
September 28, 1998, the District Court denied both motions  to
dismiss, finding that (1) the court had personal jurisdiction 


under section 13-423(a)(4) of the D.C. long-arm statute, be- cause GTE
had sufficiently alleged a tortious injury in the  District caused by
the defendants' acts outside of the District;  and (2) because venue
is proper under 28 U.S.C. s 1391  wherever a party is subject to
personal jurisdiction, the  finding of personal jurisdiction also
resolved the venue ques- tion. On March 29, 1999, however, the
District Court certi- fied an order for interlocutory appeal and
ordered a stay of  proceedings. The District Court noted that,
although it had  found that the defendants operated an interactive
website  that supported a finding of personal jurisdiction,


the instant case differs from any other reported case ...  in that it
involves an interactive website with no other  contacts with the
District of Columbia. All of the inter- active website cases reviewed
by this court involved  defendants with at least some physical contact
with the  forum. While this court has concluded that the quality  and
nature of the [operating companies'] website favors  the exercise of
personal jurisdiction in the District of  Columbia, certainly a
substantial ground for difference of  opinion concerning the ruling


GTE New Media Servs. Inc., Order Certifying for Interlocu- tory Appeal
the Court's Ruling That Personal Jurisdiction  Exists and Staying
Proceedings at 3, reprinted in J.A. 218  (emphasis added). On April 8,
1999, the defendants filed a  petition for permission to appeal. This
court entered an  order granting permission to appeal on May 28,


II. Discussion


A. The District of Columbia Long-Arm Statute and the  Due Process
Clause of the U.S. Constitution


To establish personal jurisdiction over a non-resident, a  court must
engage in a two-part inquiry: A court must first  examine whether
jurisdiction is applicable under the state's  long-arm statute and
then determine whether a finding of  jurisdiction satisfies the
constitutional requirements of due  process. See United States v.
Ferrara, 54 F.3d 825, 828 (D.C.  Cir. 1995).


The District's long-arm statute provides, in relevant part,  that


[a] District of Columbia court may exercise personal  jurisdiction over
a person, who acts directly or by an  agent, as to a claim for relief
arising from the person's-- (1) transacting any business in the
District of Columbia;  ... (4) causing tortious injury in the District
of Columbia  by an act or omission outside the District of Columbia if
 he [i] regularly does or solicits business, [ii] engages in  any
other persistent course of conduct, or [iii] derives  substantial
revenue from goods used or consumed, or  services rendered, in the
District of Columbia.


D.C. Code Ann. s 13-423(a) (1981). A plaintiff seeking to  establish
jurisdiction over a non-resident under the foregoing  provisions of
the long-arm statute must demonstrate, pursu- ant to section (a)(1),
that the plaintiff transacted business in  the District, or show,
pursuant to section (a)(4), that the  plaintiff caused a tortious
injury in the District, the injury  was caused by the defendant's act
or omission outside of the  District, and the defendant had one of the
three enumerated  contacts with the District. Section (a)(1)'s
"transacting any  business" clause generally has been interpreted to
be coex- tensive with the Constitution's due process requirements and 
thus to merge into a single inquiry. See Ferrara, 54 F.3d at  828.
Section (a)(4) has been construed more narrowly, how- ever. See Crane
v. Carr, 814 F.2d 758, 762 (D.C. Cir. 1987)  ("The drafters of this
provision apparently intended that the  (a)(4) subsection would not
occupy all of the constitutionally  available space.... This court has
explicitly noted, more- over, that (a)(4) of the D.C. long-arm statute
may indeed stop  short of the outer limit of the constitutional


Even when the literal terms of the long-arm statute have  been
satisfied, a plaintiff must still show that the exercise of  personal
jurisdiction is within the permissible bounds of the  Due Process
Clause. In other words, a plaintiff must show  "minimum contacts"
between the defendant and the forum  establishing that "the
maintenance of the suit does not offend  traditional notions of fair
play and substantial justice." Inter-


national Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)  (internal
quotation marks omitted). Under the "minimum  contracts" standard,
courts must insure that "the defendant's  conduct and connection with
the forum State are such that he  should reasonably anticipate being
haled into court there."  World-Wide Volkswagen Corp. v. Woodson, 444
U.S. 286, 297  (1980).


Cases applying the familiar personal jurisdiction analysis to  the
Internet are thus far relatively scarce; only the Second,  Fifth,
Sixth, and Ninth Circuits have ventured into this  domain. Three
decisions among the five issued by these four  appellate courts have
dismissed complaints for want of per- sonal jurisdiction.


In Bensusan Restaurant Corp. v. King, 126 F.3d 25, 29 (2d  Cir. 1997),
for example, the Second Circuit found that the  operator of a Missouri
jazz club named "The Blue Note" did  not commit tortious acts in New
York within the meaning of  New York's long-arm statute when he
established an Internet  website for his club that contained a
hyperlink to a New York  club of the same name. The court held that,
because the  Missouri club operator should not have reasonably
expected  his allegedly tortious acts to have consequences in New York
 and because he did not significantly engage in interstate  commerce,
it would not extend long-arm jurisdiction under  another subsection of
the long-arm statute.


Similarly, in Mink v. AAAA Development LLC, 190 F.3d  333, 336-37 (5th
Cir. 1999), the Fifth Circuit declined to find  personal jurisdiction
in a case in which the developer of a  computer software program
brought an action against pur- ported competitors and sought to rest
personal jurisdiction on  a finding that the defendant operated an
Internet website  that was accessible by residents in the forum state.
The  court reasoned that "[t]here was no evidence that [the defen-
dant] conducted business over the Internet by engaging in  business
transactions with forum residents or by entering  into contracts over
the Internet." Id. at 337. Thus, although  the defendant's website had
an e-mail address that allowed  consumers to interact with the
company, the court noted that 


"[t]here is no evidence ... that the website allows [the  defendant] to
do anything but reply to e-mail initiated by  website visitors." Id.
The court also noted that the website  was not interactive enough to
support a finding of jurisdic- tion, because customers could not
purchase anything on-line.  See id.


Finally, in Cybersell, Inc. v. Cybersell, Inc., 130 F.3d 414,  419-20
(9th Cir. 1997), the Ninth Circuit declined to find  personal
jurisdiction in an infringement action in Arizona  against a Florida
corporation that provided consulting ser- vices for strategic
management on the web and used the same  name as the plaintiff's
corporation. The court found that the  challenged web page was
essentially passive. The court  found that there was "no question that
anyone, anywhere  could access that home page and thereby learn about
the  services offered," but it failed to "see how from that fact alone
 it can be inferred that [the defendant] deliberately directed  its
merchandising efforts toward Arizona residents." Id. at  419. In
addition, the court noted that because the defendant  did not
encourage people in Arizona to access its sites and  there was no
evidence that any part of the defendant's  business was sought or
achieved in Arizona--in fact, no  Arizona resident other than the
plaintiff had ever "hit" the  defendant's site--there was no
purposeful availment and thus  no personal jurisdiction. See id.


The two decisions in which appellate courts have found  personal
jurisdiction in cases involving Internet-related dis- putes present
facts that are quite different from those in the  instant case. In
CompuServe, Inc. v. Patterson, 89 F.3d  1257, 1264 (6th Cir. 1996),
for example, the Sixth Circuit  found personal jurisdiction over a
defendant in Ohio, because  the defendant had entered into a contract
that allowed him to  market his software in other states with
Ohio-based Compu- Serve acting as his distributor. The court concluded
that it  was reasonable to subject the defendant to suit in Ohio, 
because it was home to the computer network service that he  himself
had chosen to employ. The court also determined  that the defendant
was on notice that he had created a  connection with Ohio, because (1)


tracts that would be governed by Ohio law with an Ohio- based company;
and (2) he sent his software, via electronic  links, to Ohio and
advertised his products on CompuServe.  The court highlighted that "it
is Patterson's relationship with  CompuServe as a software provider
and marketer that is  crucial to this case." Id. at 1264. In this
case, however, GTE  has yet to offer evidence of either a contractual
relationship  or a comparable marker of activity directed uniquely
toward  the District.


Likewise, in Panavision International, L.P. v. Toeppen,  141 F.3d 1316
(9th Cir. 1998), the Ninth Circuit upheld  personal jurisdiction in a
case involving a "cyber-pirate" (i.e.,  someone who steals valuable
trademarks, establishes domain  names on the Internet using the
trademarks, and then offers  to sell the domain names back to the
rightful trademark  owners), see id. at 1318, by employing the
"effects doctrine,"  which holds that "jurisdiction may attach if the
defendant's  conduct is aimed at or has an effect in the forum state."
Id.  at 1321. The court concluded that "[t]he brunt of the harm to 
Panavision was felt in California," given that Panavision's  principal
place of business was in California and "the heart of  the theatrical
motion picture and television industry is located  there." Id. In the
instant case, unlike Panavision, there is  nothing as yet to indicate
that the defendants engaged in  unabashedly malignant actions directed
at or felt in this  forum.


The District Court in this case asserted personal jurisdic- tion,
pursuant to D.C. Code Ann. s 13-423(a)(4), on the  ground that the
defendants allegedly caused tortious injury in  the District by an act
outside the District followed by a  persistent course of conduct in
the District. Under this  theory of jurisdiction, it does not matter
that the defendants  have no demonstrated physical contacts in the
District.  Rather, it is enough, according to the District Court, that
the  defendants entered into an agreement outside of the District 
with an eye toward attracting Internet users in the District to  their
websites (instead of to GTE's SuperPages) and thereby  draw
advertisers away from GTE. The District Court found  that, on these
asserted facts alone, the defendants foreseeably 


caused tortious injury to GTE's business in this forum. See  Ameritech
Corp., Mem. Op. at 10, reprinted in J.A. 190. The  defendants' course
of conduct was seen to be "persistent" by  the District Court, because
their websites are "highly interac- tive" with District users and
significantly commercial in both  quality and nature. Id. at 11-12,
reprinted at J.A. 191-92.  We disagree with this line of reasoning.


There is no evidence in this record to support the claim  that the
defendants "secured advertising revenue by increas- ing the user
traffic on their websites." Id. at 13, reprinted at  J.A. 193. At
best, GTE has provided only conclusory state- ments and intimations to
buttress its assertion that it lost  advertising revenues as a result
of the defendants' actions.  These are not enough. Cf. First Chicago
Int'l v. United  Exchange Co., 836 F.2d 1375, 1378-79 (D.C. Cir. 1988)
("Con- clusory statements ... '[do] not constitute the prima facie 
showing necessary to carry the burden of establishing person- al
jurisdiction.' ... [T]he 'bare allegation' of conspiracy or  agency is
insufficient to establish personal jurisdiction." (cita- tion
omitted)). We will neither assume nor infer that the  alleged
conspiracy had substantial effects of the sort alleged  by GTE,
because to do so would be to assume or infer the  answer to the very


Furthermore, it is difficult to understand, at least on the  present
record, what tortious injury has been suffered by  GTE in the
District. GTE claims that it has lost advertising  revenues by virtue
of the defendants' allegedly unlawful  conspiracy. However, nothing
has been offered to indicate  that these advertising revenues were
lost in the District,  either by lost sales or lost revenue


Additionally, personal jurisdiction surely cannot be based  solely on
the ability of District residents to access the defen- dants'
websites, for this does not by itself show any persistent  course of
conduct by the defendants in the District. Access  to a website
reflects nothing more than a telephone call by a  District resident to
the defendants' computer servers, all of  which apparently are
operated outside of the District. And,  as this court has held, mere
receipt of telephone calls outside 


the District does not constitute persistent conduct "in the  District"
within the meaning of the long-arm statute. See  Tavoulareas v.
Comnas, 720 F.2d 192, 194 (D.C. Cir. 1983).


Finally, GTE appears to suggest that, when a District  resident
accesses the defendants' Yellow Pages websites, the  defendants are
somehow "transacting business" in the Dis- trict. This is a
far-fetched claim on this record. Access to an  Internet Yellow Page
site is akin to searching a telephone  book--the consumer pays nothing
to use the search tool, and  any resulting business transaction is
between the consumer  and a business found in the Yellow Pages, not
between the  consumer and the provider of the Yellow Pages. In short, 
there is nothing here to indicate that District residents actu- ally
engage in any business transactions with the defendants.


When stripped to its core, GTE's theory of jurisdiction  rests on the
claim that, because the defendants have acted to  maximize usage of
their websites in the District, mere acces- sibility of the
defendants' websites establishes the necessary  "minimum contacts"
with this forum. See Br. for Appellee at  16. This theory simply
cannot hold water. Indeed, under  this view, personal jurisdiction in
Internet-related cases  would almost always be found in any forum in
the country.  We do not believe that the advent of advanced
technology,  say, as with the Internet, should vitiate long-held and
invio- late principles of federal court jurisdiction. The Due Process 
Clause exists, in part, to give "a degree of predictability to  the
legal system that allows potential defendants to structure  their
primary conduct with some minimum assurance as to  where that conduct
will and will not render them liable to  suit." World-Wide Volkswagen
Corp., 444 U.S. at 297. In  the context of the Internet, GTE's
expansive theory of per- sonal jurisdiction would shred these
constitutional assurances  out of practical existence. Our sister
circuits have not accept- ed such an approach, and neither shall we.


B. The Clayton Act


GTE asserts an alternative basis for personal jurisdiction,  resting on
Section 12 of the Clayton Act, 15 U.S.C. s 22  (1994). Section 12
provides:


Any suit, action, or proceeding under the antitrust  laws against a
corporation may be brought not only in  the judicial district whereof
it is an inhabitant, but also in  any district wherein it may be found
or transacts busi- ness; and all process in such cases may be served
in the  district of which it is an inhabitant, or wherever it may  be
found.


15 U.S.C. s 22 (emphasis added). The language of the  statute is plain,
and its meaning seems clear: The clause  before the semi-colon relates
to a supplemental basis for  venue in actions under the Clayton Act;
the clause after the  semi-colon relates to nationwide service of
process in anti- trust cases; and invocation of the nationwide service
clause  rests on satisfying the venue provision.


Although both parties agree that the clause regarding  nationwide
service also confers nationwide jurisdiction, they  disagree over
whether the venue clause must be satisfied for  there to be nationwide
personal jurisdiction over defendants  in antitrust cases. The
defendants argue that "[p]roper  venue under Section 12 is ... a
prerequisite for nationwide  service (and jurisdiction): [I]f venue
does not lie under the  provision, nationwide service is
impermissible." See Reply  Br. of Appellants at 22. GTE contends that
compliance with  Section 12's venue provision is not a prerequisite
for use of its  national jurisdiction provision. More specifically,
GTE ar- gues that venue may be obtained under either Section 12 or 
under the general federal venue provision of 28 U.S.C.  s 1391, and
that use of either route allows resort to Section  12's national


GTE relies on Go-Video, Inc. v. Akai Electric Co., 885 F.2d  1406 (9th
Cir. 1989), to buttress its position. In Go-Video, the  Ninth Circuit
rejected the argument that Section 12 must be  read as an "integrated
whole," even though the reference to  serving process "in such cases"
clearly seems to require that  the preceding clause's venue
requirements be established  before nationwide service can be
authorized. The court rea- soned that "as a general matter, courts
have interpreted  special venue provisions to supplement, rather than
preempt,  general venue statutes." Id. at 1409. Under this analysis,


interpretation of Section 12 that viewed the first clause as 
restricting the second clause would contradict the general  view of
Section 12 as expanding the bounds of venue. We  disagree with the
reasoning of the Ninth Circuit.


The desire to view Section 12's venue provision as expan- sive does not
justify the Ninth Circuit's total disregard of the  first clause,
particularly given the literal convolutions re- quired to jettison the
first clause. Indeed, it seems quite  unreasonable to presume that
Congress would intentionally  craft a two-pronged provision with a
superfluous first clause,  ostensibly link the two provisions with the
"in such cases"  language, but nonetheless fail to indicate clearly
anywhere  that it intended the first clause to be disposable. Even the
 Ninth Circuit seems to recognize that its sweeping interpreta- tion
of Section 12 tends to make the venue provision "wholly  redundant."
Id. at 1413.


On the question of the meaning of Section 12, we align  ourselves with
the position taken by the Second Circuit. See  Goldlawr, Inc. v.
Heiman, 288 F.2d 579, 581 (2d Cir. 1961),  rev'd on other grounds, 369
U.S. 463 (1962). The court in  Goldlawr reasoned that Section 12


specifies where suit against a corporation under the  antitrust laws
may be brought, namely, in a district  where it is an inhabitant and
also where 'it may be found  or transacts business.' Conversely, it
should follow that  if a corporation is not an inhabitant of, is not
found in,  and does not transact business in, the district, suit may 
not be so brought. By statutory grant if suit is brought  as
prescribed in this section 'all process in such cases  may be served
in the district of which it [the corporation]  is an inhabitant, or
wherever it may be found.' Thus, 'in  such cases,' Congress has seen
fit to enlarge the limits of  the otherwise restricted territorial
areas of process. In  other words, the extraterritorial service
privilege is given  only when the other requirements are satisfied.


Id.


In our view, the Second Circuit's unadorned interpretation  of Section
12 is clearly correct. See also Herbert Hoven-


kamp, Personal Jurisdiction and Venue in Private Antitrust  Actions in
the Federal Courts, 67 Iowa L. Rev. 485, 509 (1982)  ("A better
approach is to interpret section 12 the way it is  written. Worldwide
service is proper only when the action is  brought in the district
where the defendant resides, is found,  or transacts business."). A
party seeking to take advantage  of Section 12's liberalized service
provisions must follow the  dictates of both of its clauses. To read
the statute otherwise  would be to ignore its plain meaning. Thus,
because GTE  has not shown that the defendants were inhabitants of,
may  be found in, or transacted business in the District, as required 
by Section 12's first clause, it cannot avail itself of Section  12's


C. Jurisdictional Discovery


Finally, GTE contends that if, on the existing record, there  are
insufficient grounds to support personal jurisdiction, it is  still
entitled to jurisdictional discovery. We agree. This  court has
previously held that if a party demonstrates that it  can supplement
its jurisdictional allegations through discov- ery, then
jurisdictional discovery is justified. See Crane, 814  F.2d at 760
(vacating, in part, the District Court's judgment,  because "Crane's
case was dismissed with no opportunity for  discovery on the issue of


Such is the case here. The record now before this court is  plainly
inadequate. We do not even know for certain which  defendants own and
operate which websites. Even the par- ties at oral argument agreed
that the jurisdictional questions  at issue are quite different for
some defendants as opposed to  others. And, as the record now stands,
there is absolutely no  merit to GTE's bold claim that the parent
companies and  subsidiaries involved in this lawsuit should be treated
identi- cally. Jurisdictional discovery will help to sort out these 
matters. GTE also claims that it may be able to present new  facts to
bolster the District Court's theory of "substantial  effects" within
the District. We cannot tell whether jurisdic- tional discovery will
assist GTE on this score, but it is entitled  to pursue precisely
focused discovery aimed at addressing  matters relating to personal


III. Conclusion


For the foregoing reasons, the case is hereby remanded to  the District
Court for further proceedings.