AdWords Buys Using Geographic Terms Support Personal Jurisdiction–Rilley v. MoneyMutual

This is a personal jurisdiction case, so I’ll get right to the point. If an AdWords advertiser buys keywords that contain geographic terms, the advertiser might face a greater risk of personal jurisdiction in those geographies. It’s likely that buying geo-located AdWords ads would also increase that risk, but this case doesn’t address that scenario. If you want a little more detail, keep reading.

This case is a consumer protection lawsuit against a payday lender, MoneyMutual. The plaintiffs sought personal jurisdiction over the defendant in Minnesota. Among other supporting facts, the plaintiffs alleged that MoneyMutual bought the exact-match keyword phrases “payday loans Minnesota” and “payday loans Minneapolis.” MoneyMutual replied that it bought “payday loans [geography]” for lots of different geographies, so this was really a nationwide campaign with multiple local implementations in parallel with each other. The Minnesota Supreme Court doesn’t like this argument at all:

Hypothetically, if MoneyMutual paid for AdWords directed at other states, such as “payday loan New York,” it would not diminish the conclusion that MoneyMutual targeted Minnesota with its AdWords campaign. Rather, it would tend to establish contacts with both Minnesota and New York.

In a footnote, the court reinforces that it sees these ad buys as geographically targeted, not the extension of a national campaign:

MoneyMutual generally affirms that “[n]o advertising of any kind is targeted specifically to Minnesota or Minnesotans.” This general denial is troubling in light of the allegations in respondents’ affidavits and exhibits regarding the Google AdWords campaign.

MoneyMutual also challenged the connection between the ad campaign and the plaintiffs’ alleged harms. The court says:

Although at this early stage of the litigation there is no evidence that the Google Ads actually caused any of the claims, the Google Ads are sufficiently related to the claims of respondents to survive a motion to dismiss. Respondents allege that MoneyMutual’s website and advertising violated consumer protection statutes on false advertising and deceptive trade practices and that MoneyMutual conspired with, aided, and abetted, unlicensed payday lenders that extended loans under terms that violated Minnesota law. MoneyMutual’s Google Ads, which were targeted at searches including “Minnesota” and “Minneapolis,” solicited viewers to apply for these allegedly illegal payday loans by stating, for example: “Apply Online Now Fast Payday Loan—Apply Online! Safe & Bad Credit OK Up to $1,000.”

As in the Carrillo case discussed above, these ads are sufficiently “related to” the cause of action because they were a means by which MoneyMutual solicited Minnesotans to apply for the allegedly illegal loans. Carrillo, 115 F.3d at 1544. As a result, MoneyMutual’s use of Google AdWords advertising that was specifically designed to target Minnesota residents is a relevant contact with the Minnesota forum for the purpose of the minimum contacts analysis.

The court summarizes its minimum contacts analysis:

After a thorough review, we conclude that minimum contacts with Minnesota exist and support the exercise of personal jurisdiction in this case.

MoneyMutual sent over 1,000 emails to known Minnesotans, soliciting them to apply for payday loans. These emails were the culmination of transactions between MoneyMutual and Minnesota residents through which Minnesota residents provided their personal information to MoneyMutual in return for being matched with a payday lender. By engaging in these transactions and knowingly matching Minnesota residents with payday lenders, MoneyMutual purposefully availed itself of the Minnesota market and Minnesota forum and should have “reasonably anticipate[d] being haled into court” in Minnesota. Burger King, 471 U.S. at 474. These contacts alone are sufficient to support a finding of personal jurisdiction.

MoneyMutual also engaged with the Minnesota market through the use of Google AdWords, specifically designed and calibrated to target potential Minnesota customers. Unlike its national television advertising campaign, MoneyMutual’s use of Google AdWords was specific to Minnesota and, once again, demonstrates that MoneyMutual purposefully directed its conduct toward Minnesota, further buttressing the conclusion that sufficient minimum contacts exist for the exercise of personal jurisdiction over MoneyMutual.

So the lesson I draw from this: the more your ads are customized to a particular geography, the more likely you’ll be liable for personal jurisdiction in that geography. I doubt this will change many advertisers’ behaviors, but at least they can and should appreciate those consequences. And if you’re a plaintiff trying to reach a remote defendant, your odds of establishing jurisdiction increase if you can show greater geographic scienter by the defendant.

Case citation: Rilley v. MoneyMutual, LLC, 2016 WL 4446156 (Minn. Aug. 24, 2016)

Closely related posts:

* Keyword Advertising Doesn’t Create General Jurisdiction–Rocke v. Pebble Beach. I wrote: “I think the court also correctly left open the possibility that an Adwords advertiser who uses Google’s geographic targeting might face a different legal conclusion–though, at most, only with respect to specific jurisdiction. I still don’t see how advertising alone can create general jurisdiction.”
* Keyword Ads and Other Marketing Supports Remote Jurisdiction–Market America v. Optihealth