For anyone involved in Web publishing, attracting revenue is a constant struggle. To remain profitable, Web publishers are facing the uncomfortable decision about whether to switch from an ad revenue model to a subscription model to remain viable.

Certainly, there is a plethora of commentary available about the pitfalls of relying on advertising revenue to maintain content on the Web. For example, Sherlock Strategies Business Management Newsletter gets right to the heart of the matter, calling sites that solely rely on ad revenue 'nuts.' And, there are quite a few success stories about firms that charge for viewing content. For example, James Daly's piece in Business 2.0 or the success of Variety's Web subscriptions give publishers hope when choosing to become pay-per-view.

However, it would be a mistake to make this decision without first examining the potential legal consequences of the decision. Switching from ad revenue to subscription services may have an unintended legal consequence: personal jurisdiction in a far away place. Those are small words that can result in big expenses down the road. Read on. Personal jurisdiction is simply the authority of the court over a defendant. It answers questions such as, 'Can a plaintiff in Mississippi sue, in the Mississippi courts, a defendant whose brick and mortar office is in Smokey Point, Washington?' In the United States, personal jurisdiction is generally determined by the contacts that the defendant has with the forum state, where suit is filed such as Mississippi. Factors that courts typically consider to determine personal jurisdiction include the defendant's residence, place of incorporation, location of offices, and other ties to that state. In the virtual world of the Internet, a firm's presence in a particular state may be nothing more than a customer's ability to access the firm's Web site -- and that could be an important factor in determining personal jurisdiction.

For small publishers with limited circulation such as local and community newspapers, Web logs, and true start-ups, personal jurisdiction can have significant consequences. The voice and circulation of small publishers are ordinarily limited. The Web gives them access to a much larger audience. When the decision is made to switch from a passive Web site to a subscription-based service, they may unwittingly find themselves in court in a far away location.

By and large, courts grappling with Internet jurisdictional questions have adopted a sliding scale for answering the jurisdiction question. On the one hand, they have been reluctant to assert jurisdiction over a non-resident defendant where the Web site is merely 'accessible' from the state where the lawsuit is filed.

Take for example a Web site in Washington that is not interactive, does not conduct e-commerce, and is only informational. If sued in Mississippi, the defendant can argue that it has no ties to Mississippi, and that it would be unfair to have to defend itself in such a faraway place. Most likely, the court will agree and require the plaintiff in this scenario to bring the suit in Washington, where the defendant conducts its business.

The courts typically describe these non-interactive Web sites as 'passive,' and have gone on to determine that passive Web sites have insufficient ties to the state where suit is filed to satisfy due process requirements for personal jurisdiction. Jewish Defense Org. v. Superior Court (1999) 72 Cal.App.4th 1045; Benusan Rest. Corp. v. King (2d Cir. 1997); and Cybersell v. Cybersell (9th Cir. 1997) 130 F.3d 414, are illustrative of this determination.

On the other hand, as the Web site becomes more interactive with click-throughs and solicitations for goods and services, the more likely the court will assert personal jurisdiction over the out-of-state defendant.

So, where a Washington Web site provides a series of click-throughs that allows Mississippi residents to purchase goods or services from the site, the Washington business had better be prepared to defend itself in Mississippi. This is particularly true if the Washington business has targeted Mississippi customers in its advertising or solicitations. See, Park Inns International, Inc. v. Pacific Plaza Hotels, Inc. 5 F.Supp.2d 762 (booking hotel reservations); Hall v. LaRonde (1997) 56 Cal.App.4th 1342 (e-mail and telephone calls to the other state).

Is a Web site that sells subscriptions to customers in another state subject to suit there? Consider the case of American Network, Inc. v. Access America/Connect Atlanta (S.D.N.Y. 1997) 975 F.Supp. 494, where the court found that personal jurisdiction in New York was proper as a consequence of subscriptions sold on the Internet and delivered to six New York residents. The implication is that even a small number of subscriptions in another state may satisfy the court that jurisdiction is proper there.

We live in a litigious society. Small publishers face legal challenges from competitors, disappointed customers, and those who are depicted in their news stories. They typically are without the financial resources to defend themselves outside of their local communities, and would be shocked to learn that they could be sued thousands of miles from their places of business, simply because they sold a subscription from their Web site to a resident of another state.

Moreover, litigation expenses are enormous even before adding the costs of travel for witnesses and corporate officers. Flying lawyers from Smokey Point, Washington to Mississippi, or hiring another set of lawyers in Mississippi may simply be cost prohibitive. When it becomes more cost effective to settle than litigate a principle, whose interests are really being served?

In contrast, these issues are lessened for large publishers because personal jurisdiction is seldom an issue. For example, the National Enquirer is distributed throughout the country. It is difficult to conceive of a situation where it could not be subject to a court's jurisdiction. Indeed, the U.S. Supreme Court has held that it was subject to suit in California based upon the publication's circulation in that state. See Calder v. Jones (1984) 465 U.S. 783, 791.

So, what can smaller Web publishers do to protect themselves?

The most cost-effective solution may be a forum-selection clause in the subscription documentation and on the Web site. It can be inferred that the Web site will want to pick a forum where it wants to litigate, where it can afford to litigate, and where the laws are favorable to its business.

A forum-selection clause merely states where it is proper for a dispute to be litigated. For example, a Washington publisher may specify that 'jurisdiction for any disputes concerning content on the Web site must be brought in the state courts of Washington.' It can require the dispute to be arbitrated, and it can include a provision that the dispute will be determined under the 'laws of the State of Washington.' Absent evidence that enforcement of the forum selection clause would be unreasonable, the clause should be upheld by the courts. See, e.g., Graham Technology Solutions, Inc. v. Thinking Pictures, Inc. (N.D.Cal 1997) 949 F.Supp.1427. Obviously, to avoid confusion, feigned or actual, the site will need to set this clause off from other language in its subscription documents, by type-size, font or both.

An analogy exists in the travel industry where tickets have routinely contained forum selection provisions for years. See, e.g., Selling Travel Services Over the Internet and Its Impact upon Jurisdiction. By implication, forum selection clauses in Web subscriptions should be equally practical and enforceable, and adding a forum-selection provision should be part of any Web publisher's Internet strategy.

Today, it is not uncommon to see terms and conditions for use of Web sites that set forth information about data collection practices, privacy, and users' responsibilities while viewing the site. These provisions are often as creative as the Web site itself. Adding a forum-selection clause to the terms and conditions of the subscription document is a simple matter. And, while it may not always avoid the need to send lawyers half-way across the country to make an appearance in Mississippi, the provision will go along way toward that end.

Of course, Web sites moving to a subscription-based model do not need to add forum-selection to their documentation. But, if they don't, they need to be prepared to litigate wherever their customers can be found.