Stanford Law School - Robert Crown Law Library

Filed 6/6/05

IN THE SUPREME COURT OF CALIFORNIA

FRANK SNOWNEY et al.,
Plaintiffs
and
Appellants,
) S124286
v.
Ct.App. 2/3 B164118
HARRAH’S ENTERTAINMENT, INC., et al., )

Los Angeles County
Defendants and Respondents.
Super. Ct. No. BC267575

In this case, a California resident filed a class action against a group of
Nevada hotels for failing to provide notice of an energy surcharge imposed on
hotel guests. Although these hotels conduct no business and have no bank
accounts or employees in California, they do advertise heavily in California and
obtain a significant percentage of their business from California residents. These
advertising activities include billboards located in California, print ads in
California newspapers, and ads aired on California radio and television stations.
These hotels also maintain an Internet Web site and toll-free phone number where
visitors or callers may obtain room quotes and make reservations. We now
consider whether, based on these activities, California courts may exercise
personal jurisdiction over these hotels, and conclude that they may.
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I.
Defendants Harrah’s Las Vegas, Inc., Harrah’s Laughlin, Inc., Harrah’s
Operating Company, Inc. (HOC), Rio Properties, Inc., and Harveys Tahoe
Management Company, Inc. (collectively defendants) own and operate hotels in
Nevada. Plaintiff Frank Snowney is a California resident. In 2001, plaintiff
reserved a room by phone from his California residence at one of the hotels owned
and operated by defendants. To make the reservation, plaintiff gave the
reservation agent his credit card number. At the time plaintiff made the
reservation, the agent told him that the room would cost $50 per night plus the
room tax. When plaintiff paid his bill at checkout, however, the bill included a $3
energy surcharge.
Plaintiff filed the instant class action against defendants and other entities1
on behalf of himself and other “persons who were charged an energy surcharge as
an overnight hotel guest in one of the defendant’s hotels, yet were never given
notice that there was an energy surcharge and/or what such charge would be.” In
the complaint, plaintiff alleged that defendants charged him and other guests an
energy surcharge during their stays at hotels owned and operated by defendants
without providing notice of these charges during the reservation or check-in
process. He further alleged that, in doing so, defendants charged more than the
advertised or quoted price. His complaint alleged causes of action for: (1)
fraudulent and deceptive business practices in violation of Business and

1
These other entities are Harrah’s Entertainment, Inc. (HEI), Rio Hotel &
Casino, Inc., Harveys Casino Resorts, Harrah’s Reno Holding Company, Inc., Rio
Vegas Hotel & Casino, Inc., Harrah’s Management Company, and Harveys P.C.,
Inc. The Court of Appeal affirmed the trial court’s dismissal as to these
defendants, and Snowney did not petition for review of, and does not appear to
challenge, this portion of the court’s ruling.
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Professions Code section 17200 et seq.; (2) breach of contract; (3) unjust
enrichment; and (4) violations of Business and Professions Code section
17500 et seq.
In response, defendants and other entities filed a motion to quash the
summons for lack of personal jurisdiction. In support of the motion, defendants
submitted a declaration from Brad L. Kerby, the corporate secretary of HEI.
Kerby stated that defendants were incorporated in either Nevada or Delaware and
maintained their principal place of business in Nevada. According to Kerby,
defendants conducted no business in California and had no bank accounts or
employees in California. Kerby, however, acknowledged that HOC was licensed
to do business in California and that Harrah’s Marketing Services Corporation
(HMSC), a wholly owned subsidiary of HOC, operated offices in California to
“assist customers who contact those offices” and “attempt[ed] to attract a limited
number of high-end gaming patrons to Harrah’s properties.”
In opposition, plaintiff submitted several declarations, a transcript of
Kerby’s deposition, and various exhibits. This evidence established that
defendants: (1) advertised extensively to California residents through billboards in
California, California newspapers, and California radio and television stations; (2)
had a joint marketing agreement with National Airlines, which served Los Angeles
and San Francisco, and advertised in the airline’s print media; (3) maintained an
interactive Web site that accepted reservations from California residents, provided
driving directions to their hotels from California, and touted the proximity of their
hotels to California; (4) accepted reservations from California residents through
their Internet Web site and a toll-free phone number listed on the site and in their
advertisements; (5) obtained a significant percentage of their patrons from
California through reservations made through the toll-free number and Web site;
and (6) regularly sent mailings to those California residents among the four to six
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million people enrolled in their “Total Rewards” program. Plaintiff’s evidence
also confirmed that HSMC maintained several offices in California to handle
reservations and market defendants’ hotels.
The trial court granted the motion to quash for lack of personal jurisdiction.
Specifically, the court found that plaintiff had failed to establish either general or
specific jurisdiction. Plaintiff appealed.
The Court of Appeal reversed as to defendants, concluding that defendants
had “sufficient contacts with California to justify the exercise of specific
jurisdiction.” Specifically, the court held that: (1) “by soliciting and receiving the
patronage of California residents” through their advertising activities, defendants
“have purposefully directed their activities at California residents, have
purposefully derived benefit from their contacts with California, and have
established a substantial connection with this state”; (2) defendants’ California
contacts “are substantially connected to causes of action that challenge an alleged
mandatory surcharge imposed on all hotel guests”; and (3) the exercise of
jurisdiction over defendants would be fair and reasonable. In doing so, the court
declined to follow Circus Circus Hotels, Inc. v. Superior Court (1981) 120
Cal.App.3d 546 (Circus Circus), disapproved in part in Vons Companies, Inc. v.
Seabest Foods, Inc. (1996) 14 Cal.4th 434, 464 (Vons).
We granted review to determine whether the exercise of jurisdiction over
defendants is proper.
II.
“California courts may exercise personal jurisdiction on any basis
consistent with the Constitution of California and the United States. (Code Civ.
Proc., § 410.10.) The exercise of jurisdiction over a nonresident defendant
comports with these Constitutions ‘if the defendant has such minimum contacts
with the state that the assertion of jurisdiction does not violate “ ‘traditional
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notions of fair play and substantial justice.’ ” ’ ([Vons], supra, 14 Cal.4th [at
p.] 444, quoting Internat. Shoe Co. v. Washington (1945) 326 U.S. 310, 316
(Internat. Shoe).)” (Pavlovich v. Superior Court (2002) 29 Cal.4th 262, 268
(Pavlovich).)
“The concept of minimum contacts . . . requires states to observe certain
territorial limits on their sovereignty. It ‘ensure[s] that the States, through their
courts, do not reach out beyond the limits imposed on them by their status as
coequal sovereigns in a federal system.’ ” (Vons, supra, 14 Cal.4th at p. 445,
quoting World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286, 292
(World-Wide Volkswagen).) To do so, the minimum contacts test asks “whether
the ‘quality and nature’ of the defendant’s activity is such that it is ‘reasonable’
and ‘fair’ to require him to conduct his defense in that State.” (Kulko v. California
Superior Court (1978) 436 U.S. 84, 92, quoting Internat. Shoe, supra, 326 U.S. at
pp. 316-317.) The test “is not susceptible of mechanical application; rather, the
facts of each case must be weighed to determine whether the requisite ‘affiliating
circumstances’ are present.” (Kulko, at p. 92.)
Under the minimum contacts test, “[p]ersonal jurisdiction may be either
general or specific.” (Vons, supra, 14 Cal.4th at p. 445.) Because plaintiff does
not claim general jurisdiction, we only consider whether specific jurisdiction
exists here.
“When determining whether specific jurisdiction exists, courts consider the
‘ “relationship among the defendant, the forum, and the litigation.” ’
(Helicopteros Nacionales de Colombia v. Hall (1984) 466 U.S. 408, 414, quoting
Shaffer v. Heitner (1977) 433 U.S. 186, 204.) A court may exercise specific
jurisdiction over a nonresident defendant only if: (1) ‘the defendant has
purposefully availed himself or herself of forum benefits’ (Vons, supra, 14 Cal.4th
at p. 446); (2) ‘the “controversy is related to or ‘arises out of’ [the] defendant’s
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contacts with the forum” ’ (ibid., quoting Helicopteros, supra, 466 U.S. at p. 414);
and (3) ‘ “the assertion of personal jurisdiction would comport with ‘fair play and
substantial justice’ ” ’ (Vons, supra, 14 Cal.4th at p. 447, quoting Burger King
Corp. v. Rudzewicz (1985) 471 U.S. 462, 472-473 [(Burger King)].)” (Pavlovich,
supra, 29 Cal.4th at p. 269.)
“When a defendant moves to quash service of process” for lack of specific
jurisdiction, “the plaintiff has the initial burden of demonstrating facts justifying
the exercise of jurisdiction.” (Vons, supra, 14 Cal.4th at p. 449.) “If the plaintiff
meets this initial burden, then the defendant has the burden of demonstrating ‘that
the exercise of jurisdiction would be unreasonable.’ ” (Pavlovich, supra, 29
Cal.4th at p. 273, quoting Vons, at p. 449.) Where, as here, “ ‘no conflict in the
evidence exists . . . the question of jurisdiction is purely one of law and the
reviewing court engages in an independent review of the record.’ ” (Vons, at
p. 449.) Applying these standards to the facts of this case, we conclude that
California may exercise specific jurisdiction over defendants.
A.
We first determine whether defendants purposefully availed themselves of
the privilege of doing business in California. Based on defendants’ purposeful and
successful solicitation of business from California residents, we find that plaintiff
has established purposeful availment.
“ ‘The purposeful availment inquiry . . . focuses on the defendant’s
intentionality. [Citation.] This prong is only satisfied when the defendant
purposefully and voluntarily directs [its] activities toward the forum so that [it]
should expect, by virtue of the benefit [it] receives, to be subject to the court’s
jurisdiction based on’ [its] contacts with the forum.” (Pavlovich, supra, 29 Cal.4th
at p. 269, quoting U.S. v. Swiss American Bank, Ltd. (1st Cir. 2001) 274 F.3d 610,
623-624.) Thus, purposeful availment occurs where a nonresident defendant
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“ ‘purposefully direct[s]’ [its] activities at residents of the forum” (Burger King,
supra, 471 U.S. at p. 472), “ ‘purposefully derive[s] benefit’ from” its activities in
the forum (id. at p. 473), “create[s] a ‘substantial connection’ with the forum”
(id. at p. 475), “ ‘deliberately’ has engaged in significant activities within” the
forum (id. at pp. 475-476), or “has created ‘continuing obligations’ between
[itself] and residents of the forum” (id. at p. 476). By limiting the scope of a
forum’s jurisdiction in this manner, the “ ‘purposeful availment’ requirement
ensures that a defendant will not be haled into a jurisdiction solely as a result of
‘random,’ ‘fortuitous,’ or ‘attenuated’ contacts . . . .” (Id. at p. 475.) Instead, the
defendant will only be subject to personal jurisdiction if “ ‘it has clear notice that
it is subject to suit there, and can act to alleviate the risk of burdensome litigation
by procuring insurance, passing the expected costs on to customers, or, if the risks
are too great, severing its connection with the state.’ ” (Pavlovich, at p. 269,
quoting World-Wide Volkswagen, supra, 444 U.S. at p. 297.)
Here, defendants’ contacts with California are more than sufficient to
establish purposeful availment. We begin by examining defendants’ Internet
contacts. To determine whether a Web site is sufficient to establish purposeful
availment, we first look to the sliding scale analysis described in Zippo Mfg. Co. v.
Zippo Dot Com, Inc. (W.D.Pa. 1997) 952 F.Supp. 1119 (Zippo). (See Pavlovich,
supra, 29 Cal.4th at p. 274.) “At one end of the spectrum are situations where a
defendant clearly does business over the Internet. If the defendant enters into
contracts with residents of a foreign jurisdiction that involve the knowing and
repeated transmission of computer files over the Internet, personal jurisdiction is
proper. [Citation.] At the opposite end are situations where a defendant has
simply posted information on an Internet Web site which is accessible to users in
foreign jurisdictions. A passive Web site that does little more than make
information available to those who are interested in it is not grounds for the
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exercise [of] personal jurisdiction. [Citation.] The middle ground is occupied by
interactive Web sites where a user can exchange information with the host
computer. In these cases, the exercise of jurisdiction is determined by examining
the level of interactivity and commercial nature of the exchange of information
that occurs on the Web site.” (Zippo, at p. 1124.)
Defendants’ Web site, which quotes room rates to visitors and permits
visitors to make reservations at their hotels, is interactive and, at a minimum, falls
within the middle ground of the Zippo sliding scale.2 In determining whether a
site falling within this middle ground is sufficient to establish purposeful
availment, however, courts have been less than consistent.
“Some courts have held that sufficient minimum contacts are established,
and the defendant is ‘doing business’ over the Internet where the defendant’s
website is capable of accepting and does accept purchase orders from residents of
the forum state.” (Shamsuddin v. Vitamin Research Products (D.Md. 2004) 346
F.Supp.2d 804, 810.) Other courts have suggested that “ ‘something more’ ” is
necessary, such as “ ‘deliberate action’ within the forum state in the form of
transactions between the defendant and residents of the forum or conduct of the
defendant purposefully directed at residents of the forum state.” (Millennium,
supra, 33 F.Supp.2d at p. 921; see also Toys “R” Us, Inc. v. Step Two, S.A.

2
Snowney contends the site falls within the first Zippo category and
establishes that defendants conduct business in California. Although we question
this contention (see Bell v. Imperial Palace Hotel/Casino, Inc. (E.D.Mo. 2001)
200 F.Supp.2d 1082, 1087-1088 (Bell) [holding that a hotel’s Web site permitting
visitors to make online reservations falls in the middle of the Zippo continuum];
Millennium Enterprises, Inc. v. Millennium Music, LP (D.Or. 1999) 33 F.Supp.2d
907, 920 (Millennium) [holding that a Web site that permits visitors to purchase
the defendants’ merchandise falls in the middle of the Zippo continuum]), we need
not resolve it here because defendants’ California contacts clearly establish
purposeful availment.
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(3d Cir. 2003) 318 F.3d 446, 454 [“there must be evidence that the defendant
‘purposefully availed’ itself of conducting activity in the forum state, by directly
targeting its web site to the state, knowingly interacting with residents of the
forum state via its web site, or through sufficient other related contacts”].) Other
courts “have criticized Zippo’s emphasis on website interactivity” (Shamsuddin, at
p. 810) and focus instead on “traditional due process principles” (id. at p. 811),
asking whether the site expressly targets “residents of the forum state” (Hy Cite
Corp. v. Badbusinessbureau.com, L.L.C. (W.D.Wis. 2004) 297 F.Supp.2d 1154,
1160). According to these courts, “Website interactivity is important only insofar
as it reflects commercial activity, and then only insofar as that commercial activity
demonstrates purposeful targeting of residents of the forum state or purposeful
availment of the benefits or privileges of the forum state.” (Shamsuddin, at p. 813;
see also Neogen Corp. v. Neo Gen Screening, Inc. (6th Cir. 2002) 282 F.3d 883,
890 [“A defendant purposefully avails itself of the privilege of acting in a state
through its website if the website is interactive to a degree that reveals specifically
intended interaction with residents of the state”].)
We need not, however, decide on a particular approach here because
defendants’ Web site, by any standard, establishes purposeful availment. By
touting the proximity of their hotels to California and providing driving directions
from California to their hotels, defendants’ site specifically targeted residents of
California. (See Burger King, supra, 471 U.S. at p. 472.) Defendants also
concede that many of their patrons come from California and that some of these
patrons undoubtedly made reservations using their Web site. As such, defendants
have purposefully derived a benefit from their Internet activities in California (id.
at p. 473), and have established a substantial connection with California through
their Web site (id. at p. 475). In doing so, defendants have “purposefully availed
[themselves] of the privilege of conducting business in” California “via the
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Internet.” (Enterprise Rent-A-Car Co. v. U-Haul International, Inc. (E.D.Mo.
2004) 327 F.Supp.2d 1032, 1042-1043 [holding that a Web site that specifically
targeted the forum state and its residents established purposeful availment].)
Defendants’ attempt to analogize their Web site to the site in Bensusan
Restaurant Corp. v. King (S.D.N.Y. 1996) 937 F.Supp. 295, is unavailing. In
Bensusan, the federal district court declined to exercise personal jurisdiction over
the defendant based on his Web site. But, unlike the Web site at issue here, the
site in Bensusan was wholly passive—not interactive—and did not specifically
target forum residents. (Id. at p. 297.) Moreover, the defendant in Bensusan,
unlike defendants here, conducted no business with forum residents through his
Web site.
In any event, even assuming that defendants’ Web site, by itself, is not
sufficient to establish purposeful availment, the site in conjunction with
defendants’ other contacts with California undoubtedly is. Aside from their Web
site specifically targeting California residents, defendants advertised extensively in
California through billboards, newspapers, and radio and television stations
located in California. They also listed a toll-free phone number for making
reservations at their hotels in their California advertisements and on their Web
site, and many of their California patrons used this number to make reservations.
Finally, defendants regularly sent mailings advertising their hotels to selected
California residents. As a result of these promotional activities, defendants
obtained a significant percentage of their patrons from California. Thus,
defendants purposefully and successfully solicited business from California
residents. In doing so, defendants necessarily availed themselves of the benefits of
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doing business in California and could reasonably expect to be subject to the
jurisdiction of courts in California.3
In reaching this conclusion, we reject defendants’ contention that no
purposeful availment exists here because the subject matter of their contracts with
California residents resides exclusively in Nevada. Unlike the cases cited by
defendants, which held that a few contracts with California residents could not, by
themselves, establish purposeful availment,4 our finding of purposeful availment
is not premised solely on defendants’ contracts with forum residents. Rather, our
finding is premised on defendants’ purposeful and successful solicitation of
business within California. Indeed, “it is an inescapable fact of modern
commercial life that a substantial amount of business is transacted solely by mail
and wire communications across state lines, thus obviating the need for physical
presence within a State in which business is conducted.” (Burger King, supra,

3
(See Shute v. Carnival Cruise Lines (9th Cir. 1990) 897 F.2d 377, 382-383
(Shute) [holding that advertising in local media, through brochures sent to travel
agents in the forum, and through promotional seminars in the forum established
purposeful availment], revd. on other grounds in Carnival Cruise Lines, Inc. v.
Shute (1991) 499 U.S. 585; Shoppers Food Warehouse v. Moreno (D.C. 2000) 746
A.2d 320, 331 (Shoppers Food Warehouse) [holding that the defendant
“conducted ‘purposeful, affirmative activity within the’ ” forum “by purposefully
directing advertisements for its . . . stores at a potential customer base in the”
forum]; Oberlies v. Searchmont Resort, Inc. (Mich.Ct.App. 2001) 633 N.W.2d
408, 415 (Oberlies) [finding purposeful availment because “the defendant engaged
in widespread advertising in” the forum “that particularly targeted” forum
“residents”].)
4
(See Goehring v. Superior Court (1998) 62 Cal.App.4th 894, 907 [finding
no purposeful availment based solely on the defendants’ execution of “sales,
security and escrow agreements” with a forum resident]; Doe v. Unocal Corp.
(9th Cir. 2001) 248 F.3d 915, 924 [finding no purposeful availment based solely
on the defendant’s contractual relations with a forum resident]; McGlinchy v. Shell
Chemical Co. (9th Cir. 1988) 845 F.2d 802, 816 [finding no purposeful availment
based solely on the defendant’s contract with a forum resident].)
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471 U.S. at p. 476.) Where, as here, “[t]he actions taken by” defendants “to solicit
business within” California “were clearly purposefully directed toward residents
of” California, “it is irrelevant where” their hotels are located. (Shute, supra, 897
F.2d at p. 382; cf. Cornelison v. Chaney (1976) 16 Cal.3d 143, 149-150 [finding
purposeful availment even though the accident giving rise to the action did not
occur in the forum state].)
We also find inapposite Archibald v. Cinerama Hotels (1976) 15 Cal.3d
853, and Spirits, Inc. v. Superior Court (1980) 104 Cal.App.3d 918. Unlike
defendants here, neither of the defendants in Archibald and Spirits engaged in
extensive advertising that specifically targeted California residents and resulted in
numerous transactions with California residents. (See Archibald, at p. 864
[refusing to exercise jurisdiction over a hotel based solely on the activities of an
independent travel agency that sold accommodations at the hotel to a California
resident]; Spirits, at p. 925 [refusing to exercise jurisdiction based solely on the
defendant’s purchase of products from a California distributor and the defendant’s
proximity to California].)
Finally, we do not find persuasive the purposeful availment analysis in
Circus Circus, supra, 120 Cal.App.3d 546. In Circus Circus, the plaintiffs
brought a negligence action against the defendant, a Nevada hotel, after the theft
of their property during their stay at the hotel. (Id. at p. 552.) In refusing to
exercise jurisdiction over the defendant, the Court of Appeal spent the bulk of its
opinion finding that no general jurisdiction existed and that the controversy did not
relate to or arise out of the defendant’s contacts with California. 5 Nonetheless,

5
In Vons, we rejected the proximate cause test applied by Circus Circus in
determining whether the plaintiff’s claims related to or arose out of the

(footnote continued on next page)
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the court also concluded that the defendant did not avail “itself of any benefits
afforded by the State of California” or seek the “ ‘protection of its laws’ ” based
on the defendant’s maintenance of a toll-free phone number for reservations (id. at
p. 569) and “advertising in California newspapers, a service paid for and rendered
without any involvement of the forum state’s laws or public facilities” (ibid.).
By focusing solely on the defendant’s involvement with California’s laws
or public facilities, however, Circus Circus applied an overly narrow interpretation
of the purposeful availment test. Purposeful availment may exist even though the
defendant did not invoke the legal protections of the forum state. Indeed,
purposeful availment exists whenever the defendant purposefully and voluntarily
directs its activities toward the forum state in an effort to obtain a benefit from that
state. (See ante, at pp. 6-7.) And, to the extent Circus Circus Hotels, Inc. v.
Superior Court, supra, 120 Cal.App.3d 546, holds that advertising activities
targeted at forum residents can never establish purposeful availment, we
disapprove of it. In any event, defendants’ promotional activities—which were far
more extensive than the promotional activities at issue in Circus Circus—
unequivocally establish that defendants purposefully and voluntarily directed their
activities at California residents.6 Accordingly, we conclude that defendants

(footnote continued from previous page)

defendant’s contacts with the forum. (Vons, supra, 14 Cal.4th at p. 464.) We
apparently left undisturbed its analysis of purposeful availment.
6
Our finding of purposeful availment does not rely on the “ ‘economic
reality’ ” test rejected in Circus Circus, supra, 120 Cal.App.3d at pages 570-571.
Rather, it relies on defendants’ purposeful and successful solicitation of business
within California—and not on the mere foreseeability that California residents will
patronize businesses of a neighboring state.
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purposefully availed themselves of the privilege of conducting business in
California.
B.
We now turn to the second prong of the test for specific jurisdiction (the
relatedness requirement), and determine whether the controversy is related to or
arises out of defendants’ contacts with California. We find that it is.
In Vons, we carefully examined the relatedness requirement. After
reviewing the relevant cases and the rationale behind the specific jurisdiction
doctrine, we declined to apply a proximate cause test7 (Vons, supra, 14 Cal.4th at
pp. 462-464) or a “but for” test8 (id. at pp. 467-469). Following a detailed
discussion of the relevant law and policy considerations, we also rejected the
“substantive relevance” test proposed by Professor Brilmayer.9 (Id. at pp. 469-
474.) Instead, we adopted a substantial connection test and held that the
relatedness requirement is satisfied if “there is a substantial nexus or connection
between the defendant’s forum activities and the plaintiff’s claim.” (Id. at p. 456.)
In adopting this test, we observed that “for the purpose of establishing
jurisdiction the intensity of forum contacts and the connection of the claim to
those contacts are inversely related.” (Vons, supra, 14 Cal.4th at p. 452.) “[T]he
more wide ranging the defendant’s forum contacts, the more readily is shown a
connection between the forum contacts and the claim.” (Id. at p. 455.) Thus, “[a]

7
The proximate cause test asks whether “the alleged injury was proximately
caused by the contacts in the forum state.” (Vons, supra, 14 Cal.4th at p. 462.)
8
The “but for” test asks “whether the injury would have occurred ‘but for’
the forum contacts.” (Vons, supra, 14 Cal.4th at p. 467.)
9
The substantive relevance test asks whether “conduct constituting a forum
contact that took place in the forum normally would be pleaded under state
substantive law applicable to the plaintiff’s cause of action.” (Vons, supra, 14
Cal.4th at p. 469.)
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claim need not arise directly from the defendant’s forum contacts in order to be
sufficiently related to the contact to warrant the exercise of specific jurisdiction.”
(Id. at p. 452.) Moreover, the “forum contacts need not be directed at the plaintiff
in order to warrant the exercise of specific jurisdiction.” (Id. at p. 455.) Indeed,
“ ‘ “[o]nly when the operative facts of the controversy are not related to the
defendant’s contact with the state can it be said that the cause of action does not
arise from that [contact].” ’ ” (Id. at p. 455, quoting Third Nat. Bank in Nashville
v. Wedge Group Inc. (6th Cir. 1989) 882 F.2d 1087, 1091.)
Amicus curiae Chamber of Commerce of the United States urges us to
reconsider Vons and, instead, adopt the substantive relevance test. It, however,
presents nothing new. Indeed, in Vons, we carefully considered and rejected the
very reasons cited by amicus curiae for adopting the substantive relevance test.
(Vons, supra, 14 Cal.4th at pp. 469-475.) We therefore continue to apply the
substantial connection test established in Vons.
Applying this test, we find that plaintiff’s claims have a substantial
connection with defendants’ contacts with California. Plaintiff’s causes of action
for unfair competition, breach of contract, unjust enrichment, and false advertising
allege that defendants failed to provide notice of an energy surcharge during the
reservation process and in their advertising. Thus, plaintiff’s causes of action are
premised on alleged omissions during defendants’ consummation of transactions
with California residents and in their California advertisements. Because the harm
alleged by plaintiff relates directly to the content of defendants’ promotional
activities in California, an inherent relationship between plaintiff’s claims and
defendants’ contacts with California exists. Given “the intensity of” defendants’
activities in California, we therefore have little difficulty in finding a substantial
connection between the two. (Vons, supra, 14 Cal.4th at p. 453.) The fact that
many of defendants’ contacts with California do not directly arise out of plaintiff’s
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transaction with defendants is immaterial. (See Logan Productions, Inc. v.
Optibase, Inc. (7th Cir. 1996) 103 F.3d 49, 53 [refusing to limit the relevant
contacts to “those contacts directly arising out” of defendant’s “deal with” the
plaintiff].) By purposefully and successfully soliciting the business of California
residents, defendants could reasonably anticipate being subject to litigation in
California in the event their solicitations caused an injury to a California resident.
(See Burger King, supra, 471 U.S. at pp. 475-476.)
Cases holding that claims for injuries suffered during a plaintiff’s stay at a
hotel or resort are not related to and do not arise from that hotel’s or resort’s
advertising in the forum state are inapposite.10 As an initial matter, most, if not
all, of these cases did not apply the substantial connection test established in Vons.
In any event, even if we agree with the holdings in these cases,11 they are

10
(See, e.g., Circus Circus, supra, 120 Cal.App.3d at p. 569 [holding that a
tort claim arising out of a burglary of the plaintiff’s hotel room does not relate to
or arise out of that hotel’s advertising in the forum]; Breschia v. Paradise
Vacation Club, Inc. (N.D.Ill. 2003) 2003 WL 22872128, p. *4 [holding that a
claim arising out of the plaintiff’s slip and fall at a resort did not relate to or arise
out of that resort’s advertising in the forum]; Bell, supra, 200 F.Supp.2d at p. 1088
[holding that a claim arising out of the plaintiff’s slip and fall at a hotel did not
relate to or arise out of that hotel’s advertising in the forum]; Dagesse v. Plant
Hotel N.V. (D.N.H. 2000) 113 F.Supp.2d 211, 218 [same]; Imundo v. Pocono
Palace, Inc. (D.N.J. 2002) 2002 WL 31006145, p. *2, revd. on reconsideration on
another ground in 2002 WL 31006143 [same]; Decker v. Circus Circus Hotel
(D.N.J. 1999) 49 F.Supp.2d 743, 749 [same]; Smith v. Sands Hotel & Casino
(D.N.J. 1997) 1997 WL 162156, p. *6 (Smith); Hurley v. Cancun Playa Oasis
International Hotels (E.D.Pa. 1999) 1999 WL 718556, p. *1 [same]; Oberlies,
supra, 633 N.W.2d 416-417 [holding that a claim arising out of the plaintiff’s slip
and fall at a ski resort did not relate to or arise out of the resort’s advertising in the
forum].)
11
Indeed, several courts have reached the opposite conclusion—that injuries
suffered during a stay at a hotel or resort are related to and do arise from that
hotel’s or resort’s advertising in the forum state. (See, e.g., Nowak v. Tak How
Investments, Ltd. (1st Cir. 1996) 94 F.3d 708, 715-716; Mallon v. Walt Disney

(footnote continued on next page)
16

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distinguishable. Unlike the injuries suffered by the plaintiffs in those cases, the
injury allegedly suffered by plaintiff in this case relates directly to the content of
defendants’ advertising in California. As such, the connection between plaintiff’s
claims and defendants’ contacts is far closer than the connection between the
claims and contacts alleged in the cases cited above. Indeed, some courts that
have refused to exercise jurisdiction where a plaintiff suffered an injury during a
stay at a hotel or resort acknowledge that they would have reached a different
conclusion if that plaintiff had alleged false advertising or fraud. (See Smith,
supra, 1997 WL 162156 at p. *6 [suggesting that claims of false advertising or
fraudulent misrepresentation would meet the relatedness requirement]; Oberlies,
supra, 633 N.W.2d at p. 417 [“A foreign corporation that advertises in Michigan
can reasonably expect to be called to defend suits in Michigan charging unlawful
advertising or alleging that the advertising, itself, directly injured a Michigan
resident”].) Accordingly, we conclude that plaintiff has met the relatedness
requirement.
C.
Having concluded that plaintiff has satisfied the purposeful availment and
relatedness requirements, we now determine “whether the assertion of specific
jurisdiction is fair.” (Vons, supra, 14 Cal.4th at pp. 475-476.) In making this

(footnote continued from previous page)

World Co. (D.Conn. 1998) 42 F.Supp.2d 143, 147; O’Brien v. Okemo Mountain,
Inc. (D.Conn. 1998) 17 F.Supp.2d 98, 101; Rooney v. Walt Disney World Co.
(D.Mass. 2003) 2003 WL 22937728, p. *4; Sigros v. Walt Disney World Co.
(D.Mass. 2001) 129 F.Supp.2d 56, 67; Shoppers Food Warehouse, supra, 746
A.2d at p. 336; Tatro v. Manor Care, Inc. (Mass. 1994) 625 N.E.2d 549, 553-554;
Radigan v. Innisbrook Resort & Golf Club (N.J.Sup.Ct.App.Div. 1977) 375 A.2d
1229, 1231.)
17

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determination, the “court ‘must consider the burden on the defendant, the interests
of the forum State, and the plaintiff’s interest in obtaining relief. It must also
weigh in its determination “the interstate judicial system’s interest in obtaining the
most efficient resolution of controversies; and the shared interest of the several
States in furthering fundamental substantive social policies.” ’ ” (Id. at p. 476,
quoting Asahi Metal Industry Co. v. Superior Court (1987) 480 U.S. 102, 113.)
“Where[, as here,] a defendant who purposefully has directed [its] activities at
forum residents seeks to defeat jurisdiction, [it] must present a compelling case
that the presence of some other considerations would render jurisdiction
unreasonable.” (Burger King, supra, 471 U.S. at p. 477.) In this case, defendants
do not contend the exercise of jurisdiction would be unfair or unreasonable, and
we see no reason to conclude otherwise. Therefore, we hold that defendants are
subject to specific jurisdiction in California.
III.
Accordingly, we affirm the judgment of the Court of Appeal.
BROWN, J.
WE CONCUR:

GEORGE,
C.J.
KENNARD,
J.
BAXTER,
J.
WERDEGAR,
J.
CHIN,
J.
MORENO,
J.
18

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See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Snowney v. Harrah’s Entertainment, Inc.
__________________________________________________________________________________

Unpublished Opinion

Original Appeal
Original Proceeding
Review Granted XXX 116 Cal.App.4th 996
Rehearing Granted

__________________________________________________________________________________

Opinion No.

S124286
Date Filed: June 6, 2005
__________________________________________________________________________________

Court:

Superior
County: Los Angeles
Judge: Peter D. Lichtman

__________________________________________________________________________________

Attorneys for Appellant:

Schreiber & Schreiber, Edwin C. Schreiber and Eric A. Schreiber for Plaintiffs and Appellants.

__________________________________________________________________________________

Attorneys for Respondent:

Fulbright & Jaworski, Robert W. Fischer, Jr., Joshua D. Lichtman, Alisha M. Lee and Andrea K. Pallios for
Defendants and Respondents.

Robin S. Conrad; Robbins, Russell, Englert, Orseck & Untereiner, Roy T. Englert, Jr., Alan E. Untereiner,
Max Huffman and Alice W. Yao for Chamber of Commerce of the United States as Amicus Curiae on
behalf of Defendants and Respondents.

---

Counsel who argued in Supreme Court (not intended for publication with opinion):

Edwin C. Shreiber
Schreiber & Schreiber
16501 Ventura Boulevard, Suite 401
Encino, CA 91436-2068
(818) 789-2577

Eric A. Schreiber
Schreiber & Schreiber
16501 Ventura Boulevard, Suite 401
Encino, CA 91436-2068
(818) 789-2577

Robert W. Fischer, Jr.
Fulbright & Jaworski
865 South Figueroa Street, 29th Floor
Los Angeles, CA 90017
(213) 892-9200

---

Opinion Information

Date:	Docket Number:
Mon, 06/06/2005	S124286

Disposition
Jun 6 2005	Opinion: Affirmed

Dockets
Apr 19 2004	Petition for review filed   counsel for resps Harrah's Entertainment, Inc., et al.
Apr 22 2004	Record requested
Apr 22 2004	Received Court of Appeal record   one doghouse
Apr 26 2004	Answer to petition for review filed   appellant Frank Snowney
May 10 2004	Received:   letter from Respondent.
Jun 10 2004	Time extended to grant or deny review   to July 16, 2004.
Jun 30 2004	Petition for review granted (civil case)   Votes: George, C.J., Kennard, Baxter, Werdegar, Chin, Brown, and Moreno, JJ.
Jul 12 2004	Certification of interested entities or persons filed   by counsel for appellant
Jul 13 2004	Certification of interested entities or persons filed   By counsel for Respondents.
Jul 30 2004	Opening brief on the merits filed   respondents HARRAH'S ENTERTAINMENT, INC., ET AL.
Aug 27 2004	Answer brief on the merits filed   appellant Frank Snowney
Sep 14 2004	Reply brief filed (case fully briefed)   respondents Harrah's Entertainment, Inc. etal
Oct 15 2004	Application to appear as counsel pro hac vice (granted case)   by Roy T. Englert, Jr. on behalf of amicus Chamber of Commerce of the United States.
Oct 15 2004	Application to appear as counsel pro hac vice (granted case)   by Robin S. Conrad on behalf of amicus Chamber of Commerce of the United States.
Oct 15 2004	Application to appear as counsel pro hac vice (granted case)   by Max Huffman on behalf of amicus Chamber of Commerce of the United States.
Oct 15 2004	Application to appear as counsel pro hac vice (granted case)   by Alan E. Untereiner on behalf of amicus Chamber of Commerce of the United States.
Oct 15 2004	Received application to file Amicus Curiae Brief   by counsel for The Chamber of Commerce of the United States.
Oct 21 2004	Application to appear as counsel pro hac vice granted   Robin S. Conrad, Roy T. Englert Jr., Alan E. Untereiner and Max Huffman of the District of Columbia fto appear pro hac vice on behalf of amicus curiae Chamber of Commerce of the United States.
Oct 21 2004	Permission to file amicus curiae brief granted   Chamber of Commerce of the United States
Oct 21 2004	Amicus curiae brief filed   by Chamber of Commerce of the United States in support of respondents. Answer due within 20 days.
Nov 9 2004	Response to amicus curiae brief filed   to a/c brief of U.S. Chamber of Commerce
Mar 2 2005	Issues ordered limited   Pursuant to California Rules of Court, rule 29(a)(1), the Court hereby limits the issues to be argued in this case to the issues presented in the petition for review. George, C.J., was absent and did not participate.
Apr 1 2005	Case ordered on calendar   5/3/05 @9am, S.F.
Apr 11 2005	Filed:   aplt's request to divide oral argument time
Apr 18 2005	Order filed   Permission granted for two counsel to argue on behalf of appellant.
Apr 18 2005	Order filed   Permission granted for appellant to allocate 10 min oral argument time to Edwin C. Schreiber.
May 3 2005	Cause argued and submitted
Jun 6 2005	Opinion filed: Judgment affirmed in full   Majority Opinion by Brown, J. joined by George C.J., Kennard, Baxter, Werdegar, Chin & Moreno, JJ.
Jul 7 2005	Remittitur issued (civil case)
Jul 14 2005	Received:   Receipt for remittitur from CA2/3.
Sep 19 2005	Received:   Notice that petition for a writ of certiorari was filed on September 6, 2005.
Nov 21 2005	Certiorari denied by U.S. Supreme Court   Received, on the above date, a letter from the U.S. Supreme Court informing this court that the petition for writ of certiorari was denied.

Briefs
Jul 30 2004	Opening brief on the merits filed
Aug 27 2004	Answer brief on the merits filed
Sep 14 2004	Reply brief filed (case fully briefed)
Oct 21 2004	Amicus curiae brief filed
Nov 9 2004	Response to amicus curiae brief filed

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