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June 28, 2006
Happy (?) Anniversary, Grokster v. MGM
By Eric Goldman
Yesterday was the 1 year anniversary of the Grokster Supreme Court ruling. This opinion was one of the most hotly anticipated Supreme Court opinions relating to copyrights (and perhaps any subject matter) of the last decade or two, and the air was filled (both before and after the opinion was issued) with lots of predictions--many of them dire--about the future of technological innovation, content dissemination and our society generally.
So, in the past year since Grokster, what has changed? Arguably, nothing. People still get digital content through a combination of paid offerings and free file sharing, which continues to be a major online activity. Content owners are still suing file sharers and demanding new laws from Congress. Entrepreneurs are still looking for ways to mediate relationships between content owners and consumers.
As for the opinion's precedential impact, I did a search for the word "Grokster" in Westlaw's federal database and came up with less than 15 opinions citing the Supreme Court opinion. From a cursory scan of these opinions, I'd say that, thus far, Grokster hasn't really done much to reshape the law.
Of course, it's impossible to fully gauge the changes due to Grokster. Grokster could be reshaping the law in unreported decisions or settlements. And if the Grokster critics are right, some technological innovation has been dissuaded by the opinion, and we'll never know what we’re not getting. Finally, it's only been 1 year, and it often takes a while for the impact of precedent to be fully realized.
Nevertheless, I'm cautiously predicting that the Grokster opinion was the great Non-Event of Summer 2005. We had a lot of punditry fun last summer, and we got a good teaching case (although I wonder if we'll still teach the case 5 years from now, or if it will be superseded by more interesting/important cases). And a few individuals (mostly notably Grokster itself, which is out of the file sharing business) have felt the case's impact. But overall, there's precious little evidence to suggest that the Grokster opinion was a watershed event--which, I think, is the very best outcome that we could expect in a situation where the defendants lost at the Supreme Court.
UPDATE: John Ottaviani wrote me with the following comment on this post:
"I think you're being a little premature on Grokster (or just being provocative to generate discussion/traffic). Grokster did affirm the "substantial non-infringing use" principle, which is used daily by attorneys counselling clients on bringng technology to market. Little of this finds its way into cases (see, e.g. Napster, Grokster), but if the SUp Ct. had wiped out that theory it would have made our counselling much more difficult.
It's too early to tell if the inducement theory will have an impact. Grokster presented a rather unique set of facts."
Posted by Eric at 11:52 AM | Copyright , Derivative Liability
CDT Report on Spyware Enforcement Actions
By Eric Goldman
The Center for Democracy & Technology has provided a public service by releasing its report, "Spyware Enforcement." The report describes, in table format, various federal and state enforcement actions against spyware purveyors. The report summarizes the action:
Since [2004], law enforcement officials have increasingly applied statutes – some long-standing, some relatively new – to spyware cases. Leading the charge has been the FTC, which to date has brought six cases under its unfair and deceptive practices authority. The Department of Justice has actively pursued spyware purveyors under the CFAA and the Wiretap Act, with 11 cases to date. And three attorneys general at the state level have filed spyware lawsuits under state fraud and consumer protection laws, with two more cases initiated under new state spyware statutes.
In addition to these government enforcement actions, also note that there have been dozens of adware- or spyware-related civil lawsuits. I don't have a single page categorizing all of these, but I've blogged repeatedly on this topic here.
UPDATE: Fred von Lohmann comments:"The report is a useful reminder to Congress that we may not need more new laws to tackle the spyware problem. As we've pointed out in the past, if Congress weighs in with new laws, those laws may do more harm than good (especially once the lobbyists for adware companies get into the game)."
Posted by Eric at 10:35 AM | Adware/Spyware
June 27, 2006
June 2006 Quick Links
By Eric Goldman
I have had virtually no Internet access over the past 10 days due to my move and travels, so my Bloglines account was bulging with more than 1700 articles. Here's a quick look at some of the items that have caught my attention this month:
* The FTC announced its own data breach due to a stolen laptop. Hmm...is it just me, or is this incident dripping with irony?
* Microsoft appears to be in its "benevolent" dictator mode again. Last year I blogged about how Microsoft made the unilateral decision to wipe some "malicious" software off users' computers without user notice or consent. (If it makes you feel any better, AOL has done the same thing). Now, Microsoft is installing mandatory software that phones home and doesn't tell users it's phoning home. Most people would categorize the phone home capability as spyware, and I'll be interested to see how the undisclosed feature doesn't violate 18 USC 1030(a)(2)(C). Yet, as Andy Patrizio wonders, where's the outrage? The consumer protection lawsuits? Andy writes:
All manner of hell broke loose over the major phone companies reportedly cooperating with the National Security Agency over international phone calls, but the news that Microsoft is watching every single Windows XP PC has been met with deafening silence.
Suzi rounds up the situation.
[UPDATE: First lawsiut over WGA filed. I'm sure more are coming.]
* JP Enterprises v. Yahoo, No. 06-cv-01046-REB-PAC (D. Colo. amended complaint filed June 6, 2006). Complaint against Yahoo Dating and other dating sites for purchasing keywords of a competitor, LoveCity. I'm not optimistic about the plaintiff's chances here, given that it doesn't seem to understand the differences between metatags and keyword triggers. Also, note the irony that Yahoo is buying ads from competitor Google.
* The WSJ writes about the accuracy of recommendation engines. The article explains how consumers make some decisions based on brand perceptions rather than actual utility they derive from the product. As a result, recommendation engines do a better job serving consumer desires by watching consumer behavior rather than relying on self-reported consumer preferences.
This also raises interesting implications for the role of brands in the search process. Brands may help consumers find what they think they are looking for, but at the same time may interfere with utility maximization. To avoid this, one recommendation engine contemplated hiding brands from the consumers.
* Heidi Cohen states the obvious. (Well, she and I think it's obvious, but apparently most marketers still don't get it.) Marketers are in the content publishing business, so they need to think like publishers, not marketers. And, from a policy standpoint, this continues to reinforce the illusory line between marketing content and editorial content.
* Another shocker: Marketers pay-for-placement in editorial content in print publications.
* Michael Scott (from his new blog, Singularity) writes a fun article about the implications of three generations of cyberlawyers: the veteran "computer lawyers" from the 1980s (that includes him), the dot com boomers from the 1990s (which I belong to), and the post-dot com busters from the 2000s.
* More evidence of "banner blindness." As usual, consumers can organically adjust to annoying marketer tactics if legislators avoid jumping into the fray.
* Finally, an article on fake consumer reviews. This is hardly the first article on the topic, but interestingly it hints that some merchants may be outsourcing/offshoring the creation of fake reviews. Forget click fraud shops in India and gold farming in China; those are passe. Instead, here's a new possible tort for you plaintiffs' lawyers--review "fraud"?
Posted by Eric at 05:50 PM | Adware/Spyware , General , Internet History , Licensing/Contracts , Marketing , Privacy/Security , Trademark
June 23, 2006
Google Child Porn Lawsuit Withdrawn--Toback v. Google
By Eric Goldman
Sensing that his 15 minutes of fame was up, Jeffrey Toback has withdrawn his lawsuit against Google regarding Google's alleged facilitation of child pornography. This withdrawal is hardly surprising given the lawsuit's complete lack of merit. Nevertheless, I am a little disappointed that the lawsuit won't proceed--I was actually looking forward to the schadenfreude of a judge issuing an opinion ripping Toback to shreds. Fortunately, the blogosphere has been doing a pretty good job on that front. I think Alex E. hit the nail on the head when he crowned Toback "Dorkus Maximus." This is the kind of devastatingly accurate nickname that can become permanent.
But I'm still holding out hope that my schadenfreude desire will be satisfied. Election season is coming up, and I trust that Toback's constituents have learned some valuable insights about the "quality" of lawmaking that they are getting from him.
Posted by Eric at 05:20 PM | Content Regulation , Derivative Liability , Search Engines
June 20, 2006
MySpace.com Sued for $30 Million
(Eric Goldman is relocating his family to California this week and next, and will be able to post only occasionally. In his absence, John Ottaviani will continue to guest blog from time to time.)
It was only a matter of time. A 14-year-old Texas girl who alleges she was sexually assaulted by a 19-year-old she met on MySpace.com has sued the site for $30,000,000, claiming that it fails to protect minors from adult sexual predators. Here is a report of the complaint from the Austin American-Statesman . MySpace.com's response: "We take aggressive measures to protect our members."
Being the parent of teen and pre-teen age children, I am all too familiar with MySpace.com and similar sites. I too question how aggressively MySpace.com really polices its site (type in the name of your local middle school and see how many underage users have become members by lying about their age!). But, I have a hard time seeing that MySpace.com has any legal duty here to protect its members (underage or of age), how it could protect its 14-year old members better than their parents, or whether there is sufficient causation to impose liability on MySpace.com for actions that occurred in the physical world.
We’ll try to get a copy of the complaint and analyze it further. If anyone has a copy, please send it along.
UPDATE: Complaint copy can be found here.
Posted by John Ottaviani at 03:49 PM | Derivative Liability | Comments (2)
June 15, 2006
Fair Use Network Launches
By Eric Goldman
An intriguing new resource, the Fair Use Network, has launched. This website is a project of the Free Expression Policy Project at the Brennan Center for Justice at NYU School of Law. This is the same group that put out the very good report, Will Fair Use Survive? Free Expression in the Age of Copyright Control, last December.
The Fair Use Network is a practical response to that report's findings of "massive confusion among artists, scholars, and others about fair use, and a need for pro bono legal help and comprehensible resource materials." The site has a number of interesting resources, but its strength is as a single-stop destination for an unrepresented party staring down the barrel of a nasty bigfoot C&D letter. Information designed to help these recipients is already online, but it's sprinkled throughout the web. Here, it's all pulled together in one place and in an accessible format. So, going forward, when I get the inquiries from C&D recipients that I can't or shouldn't handle, I'll be pointing them to this site first.
Posted by Eric at 09:31 PM | Copyright
June 13, 2006
Music File in P2P Share Directory May Be a Distribution--Interscope v. Duty
By Eric Goldman
Interscope Records v. Duty, No. 05-CV-3744-PHX-FJM (D. Ariz. Apr. 14, 2006)
Introduction
The number of P2P direct infringement opinions is growing, and the news isn't good for file sharers. The flagship case is BMG v. Gonzalez, where the 7th Circuit rejected a file sharer’s fair use defense out of hand. IN April, Evan Brown reported on a BitTorrent case where the court awarded a $35k default judgment against the file sharer. And then there's the Interscope v. Duty case, an interesting ruling from 2 months ago that appears to have been largely overlooked. (The only blog discussions I found were here and here).
What is a "Distribution"?
Interscope v. Duty deals with a recurring topic: what constitutes a "distribution" online? The Copyright Act doesn't define the word "distribution," which has created some confusion. Consider the following data points:
* Hotaling v. Church of Jesus Christ of Latter Day Saints (4th Circuit 1997) said: "When a [privately operated but publicly accessible archive] adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public." Thus, a distribution occurred without the copyrighted works leaving the building or any requirement that anyone actually accessed the works (although the plaintiff, at least, did in fact access the works).
* In the ART Act, Congress added 506(a)(1)(c), which criminalizes "the distribution of a work being prepared for commercial distribution, by making it available on a computer network accessible to members of the public." This was clearly intended to cover the warez traders who upload files to servers even if those files are never downloaded by others. However, the added language also could include the placement of copyrighted works in P2P share directories. (Note, however, that any criminal infringement must be "willful," which may be inconsistent with involuntary storage of files in a share directory--more on this in a moment). However, this language added to 506(a) does not amend the 106(3) distribution right, as Judge Patel confirmed in one of the many Napster rulings.
* Then, in May 2005, Patel ruled that Napster's index of infringing files did not, by itself, constitute a distribution of the indexed works. However, Patel didn't address whether the users were themselves engaged in distribution.
Interscope v. Duty: A File in a Share Directory May Be a Distribution
Now, the Interscope v. Duty case adds to the discussion (and the confusion). In this case, the file sharer tried to dismiss the case because she didn't “distribute” the works. Although distribution isn’t defined, the court says that “distribution” and “publication” are synonymous, and publication includes "offering to distribute" copyrighted works. Thus, the court says, "the mere presence of copyrighted sound recordings in Duty's share file may constitute copyright infringement." But in a footnote, the court says, "we do not conclude that the mere presence of copyrighted sound recordings in Duty's share file constitutes copyright infringement. We have an incomplete understanding of the Kazaa technology..." so the court will look at this issue more closely on summary judgment.
So, is putting a copyrighted work in a P2P share directory constitute a 106(3) distribution or not? I could argue the current law either way, but in most cases the question is academic. Even if the file placement does not constitute a distribution, a copy of the file was made somewhere in the process, and that copy can violate the 106 reproduction rights. Thus, the defendant still will be on the hook for copyright infringement--it doesn't really matter what 106 right is used to get there.
We can see this from the warez trading cases, where this issue has come up obliquely. Even before the ART Act, the government implicitly took the position that every copy on a warez server is infringing, regardless of whether it was ever downloaded by anyone else. And to the extent that it has been litigated, the courts appear to have accepted this. (See, e.g., US v. Rothberg).
However, warez traders differ from individual file sharers in a few ways. First, warez traders usually make infringing copies (the initial copy, an uploaded copy, and downloaded copies) regardless of any distribution. Second, warez traders are typically treated as part a conspiracy where all group members are vicariously liable for every infringement committed within the conspiracy's scope.
In contrast, if a file sharing software user copies files from a legitimately acquired media owned by the user and makes the copies solely for his/her personal noncommercial enjoyment (and not for distribution), some (many?) courts will excuse those copies as fair use. Further, if the P2P file sharing software automatically places those legitimately copied files into the share directory, courts might excuse the copying because the user’s “distribution” actions were not really volitional. Therefore, unlike the warez traders’ copying, in theory, a file sharing software user’s chain of copying may be excused through placement in the share directory.
So what's the right answer? We'll have to wait for some courts to weigh in, but I have some personal views. Personally, I think a distribution occurs only when the "bits" move from one person to an unrelated person. Thus, if a music file in the share directory is never actually downloaded by anyone else, I don't think there's been a distribution. Further, if the software user didn't expect the file to be placed in the share directory, I don't think there's volitional copying or distribution. Thus, I think that in P2P file sharing cases, the copyright owners should have to prove (a) the user expected the file to go into the share directory, and (b) the file was actually downloaded by someone else. Otherwise, all of the preceding behavior may be legally insignificant or excused.
Defendant's Counterclaims
There were two other interesting tidbits from Duty's counterclaims against the plaintiff. First, Duty argued that the plaintiff tortiously intruded into her seclusion by looking at her share directory. The court dismisses this argument quickly, saying that the share directory isn't a private space. I think this is generally right, although if the P2P network were private, I could imagine this issue being more colorable.
Second, Duty argues that the plaintiff committed the tort of abuse of legal process. The court dismisses this because the lawsuit lack the requisite improper motivation. However, the court takes a veiled dig at the RIAA, saying: "It may be an abuse of the legal process for a collection of large corporate entities to use their substantial financial and intellectual capacities to prey upon less capable individuals and unfairly pressure them into settlement." However, this statement doesn’t help Duty because she didn't allege this behavior (but I'm guessing future defendants/counterplaintiffs will!).
Conclusion
As I said, the RIAA v. the people cases aren't going well for the people. In the end, many people did commit garden-variety infringements and will pay for those infringements, regardless of whether those enforcements advance a larger goal of curbing piracy or make sense from a marketing standpoint. On the other hand, I think courts should demand more rigor from copyright owner plaintiffs—courts should confirm that the plaintiffs are suing the actual infringer (and not just the computer owner), the plaintiffs have legal standing to enforce the copyrights they claim were infringed, and (I argue) that files were downloaded before finding a distribution. Unless the courts keep the plaintiffs honest, too many innocent defendants will, in fact, be “unfairly pressured” into settlements.
UPDATE: I knew this topic was hot, but I don't think I realized all of the action over the distribution right. Fortunately, Fred von Lohmann, who is more on top of the pending litigation in this area, wrote to share his thoughts. He wrote (republished with his permission):
"Read your blog post today, and wanted to bring a few other cases to your attention. This is emerging as an extremely hot issue right now (see, e.g., the claims in the XM lawsuit, which include direct infringement claims based on a distribution theory).
The 106(3) issue has also been joined in both Elektra v. Barker and Fonovisa v. Alvarez, where EFF has filed amicus briefs on the 106(3) issue. [EFF's briefs in Barker and Alvarez]. In Barker, CCIA also filed amicus on our side, arguing a narrower question. Amicus briefs on the other side were filed by the USA (in both cases) and MPAA (in Barker).
You may want to take a look at these briefs for at least two reasons:
1. my view is that 106(3) cannot be implicated unless a physical object changes hands, which is to say it has no application to any P2P (or other internet) cases. While that may seem counter-intuitive, Tony Reese has written a thorough article laying out the relevant statutory language and leg history.
The reason it matters, despite the fact that there are also 106(1) claims available against P2P sharers, is that the characterization can matter a great deal in other contexts. After all, what we have with a P2P exchange is a transmission, followed by a recording. There are many who have licenses to publicly perform (transmit), but do not have licenses to distribute (record), such as DirecTV and XM Radio. So a precedent here will have implications elsewhere.
2. the USA brief specifically argues that their criminal prosecutions will be jeopardized unless they can use the 106(3) right. So they don't appear to agree with your view that 106(3) is redundant with 106(1) here.
[And] the "does merely offering violate 106(3)" has also come up in the MPAA amicus brief in the Perfect10 v. Google Ninth Circuit appeal. So I think it's fair to say it's being hotly contested on a variety of fronts as we speak."
Posted by Eric at 01:24 PM | Copyright | Comments (2)
June 08, 2006
Congress to Make Search Engine Bias Illegal?
By Eric Goldman
Like we couldn't see this coming. To make the point that the content providers are playing with fire, one member of Congress has proposed to sweep them into the Net Neutrality legislation (see the text). Ha ha.
I must say, I really don't understand why companies like eBay and Google have forced the Net Neutrality issue. I understand that in theory price discrimination could work to their disadvantage, but there are so many reasons not to get Congress involved now:
* the IAP's price discrimination is purely hypothetical today. No one is doing it today, and it's not clear that price discrimination by IAPs is either technologically sensible or sellable in the market.
* Congressional regulation of hypothetical technological issues never works out well (Congress isn't so hot with real live issues either). This issue, in particular, is nuanced, and nuanced policy-making is never Congress' strength.
* This issue has become partisan, with the party in control on the "wrong" side to the content providers' positions. And there are powerful economic forces opposing the content providers. (UPDATE: BusinessWeek explains the paralyzing lobbying power of the telcos).
* as we've seen, this issue could backfire if Congress starts asking questions about the discriminatory choices made by content providers. Google is especially walking a thin line given how many questions have been raised about its "discriminatory" ranking practices (see here and here and here and here).
Maybe it's too late after all their drum-beating, but my advice to Google, eBay and all the other content providers pushing the Net Neutrality issue:
LET SLEEPING DOGS LIE
Posted by Eric at 10:40 PM | Content Regulation , Search Engines | Comments (2)
"Must Carry" Lawsuit Against Search Engines--Langdon v. Google
By Eric Goldman
Langdon v. Google, 1:06-cv-00319-JJF (D. Delaware complaint filed May 17, 2006)
Omigosh, will these lawsuits over search engine editorial discretion ever cease? Earlier this week I reported on (yet another) lawsuit against Google for dropping a website in its rankings. Now, this latest lawsuit claims that the search engines squelched various political ads and de-indexed the plaintiff's website.
I won't do a thorough deconstruction of the lawsuit because it has zero chance of success. It was filed pro se and doesn't conform to standard procedural rules about complaints. More importantly, it lacks legal merit on its face. The complaint is principally based on the loser argument that a search engine is a public forum—an argument which has already been rejected a number of times.
I feel a growing ennui about with these unmeritorious pro se complaints/publicity stunts against search engines, so normally I would have passed on blogging about this. However, I thought the requested relief (see page 28 of the complaint) was remarkable enough to warrant a mention. There, the plaintiff says:
"I ask for the following relief...(c) that Google-AOL, Yahoo! and Microsoft be required to place my ads for my websites...in prominent places on their search results for searches of my choosing; (d) that Defendants Google-AOL and Yahoo! honestly rank my websites...in their search results, as Microsoft does..."
Wow, what plaintiff wouldn’t like this relief? Many websites pay search engines a lot of money for these benefits, but if guaranteed prominent ad placement and an “honest” (i.e., better) ranking is available from a judge, you can only imagine the line to the courthouse. Lawyers would displace the SEM/SEO industry entirely!
I thought the “must carry” demand implicit in (c) is particularly interesting. Recall that from Miami Herald v. Tornillo, a statutory must-carry rule applied to newspapers violated the constitutional freedom of the press. Given the very specific justifications for tighter regulation of broadcasting, and that those bases have been held inapplicable to the Internet (see, e.g., Reno v. ACLU), I think (for these purposes) that search engines are more appropriately analogized to newspapers instead of broadcasters. Accordingly, I can’t see how any judge could constitutionally order “must carry” relief here.
If I were one of the search engines sued, I’d look at this lawsuit as a blessing, not a nuisance. If the search engines play their cards right, maybe this case can produce some unambiguous and favorable precedent clarifying their right to exercise their editorial discretion (beyond the Search King precedent). That precedent, plus maybe some sanctions or anti-SLAPP relief, may help to inhibit future unmeritorious claims.
Hat tip: Wired News blog.
Posted by Eric at 12:46 PM | Content Regulation , Marketing , Search Engines | Comments (3)
June 05, 2006
Google Avoids Another Lawsuit Over Rankings (For Now)--Roberts v. Google
By Eric Goldman
Roberts v. Google, No. 1-06-CV-063047 (Cal. Superior Ct. complaint filed May 5, 2006 but voluntarily dismissed)
In what he claims is the "first legitimate complaint vs google regarding search result issues," Mark Roberts, a proprietor of two e-commerce websites, filed a pro se complaint against Google for Google's alleged mishandling of those sites' rankings. After receiving a call from Google's counsel threatening to file an anti-SLAPP motion against Roberts if he proceeded, Roberts voluntarily dismissed the complaint without prejudice. While Google may have dodged this lawsuit (at least, for now), it nevertheless highlights the burgeoning litigation over search engine rankings.
The Lawsuit
Mark Roberts runs two websites, mrprotein.com and pinnaclejuicedprotein.com. He alleges that the rankings of these websites inexplicably dropped. He claims that the mrprotein.com website was ranked in the top 10 search results prior to April 2003 and then dropped out of the rankings; and was ranked as the #2 listing in a specific Google directory category (which I assume was drawn from DMOZ) on June 2005 and then was dropped from the category page. Similarly, the pinnaclejuicedprotein.com website was regularly in the top search result prior to April 2003 and after that was dropped from the index. Some of these omissions have been rectified.
Roberts principally alleges a breach of contract. He claims that Google's "add your URL" feature constituted a unilateral offer, and part of the contract terms were various marketing representations that Google makes throughout its site, including
* Google uses PageRank to determine which pages are most important
* Google determines which pages are relevant to a search
* Google lists the most relevant and reliable results for searchers
Robert claims that he accepted Google's offer by submitting his URLs to Google, and that Google breached by downgrading/de-indexing him. As an integral but unstated part of his claims, Roberts apparently believes that his sites are more relevant/important to searchers than the sites Google chose to display.
In addition to the contract breach, Roberts claims that Google made negligent misrepresentations and violated California's unfair competition law (Business & Professions Code Sec. 17200).
After filing the lawsuit, Roberts received a preemptive phone call from Google’s attorney warning him that Google would file an anti-SLAPP motion against him if Roberts served the complaint. Google, in fact, did file an anti-SLAPP motion in response to the KinderStart lawsuit, and such aggressive behavior towards Roberts is consistent with Google's standard practice of going on the offensive i9n litigation. Based on this conversation, Roberts voluntarily dismissed the lawsuit without prejudice. Although this might be the end of this particular threat, Roberts has told me that he plans to refile the lawsuit if he doesn't get satisfactory reindexing.
The Continuing Legal Battle Over Search Engine Rankings
Regardless of the merits of this particular lawsuit, it follows the Search King and KinderStart lawsuits that, collectively, raise a critical question: who should decide the ordering of search results?
There are several options. Plaintiffs could ask judges to decide the ordering based on some judge-made criteria for relevance or importance. Or legislators could get into the relevancy business and statutorily dictate algorithms or ordering. However, for reasons I explain in my paper on search engine bias, I think judges or legislators will do a markedly inferior job of producing useful search results than search engines will do guided by marketplace forces. Therefore, these lawsuits over search engine rankings pose risk not only to the search engines, but the robustness of our information economy generally.
Nevertheless, this lawsuit (along with others, like the Yahoo "syndication fraud" lawsuit) demonstrates that plaintiffs are carefully trolling through search engine disclosures and marketing collateral looking for litigation bait. Search engines should scrub their disclosures and ensure that future disclosures are carefully QAed.
UPDATE: Techdirt offers a very sensible lesson: "From a business owner's perspective, it's your responsibility not to become too dependent on a single supplier. Basing your entire business on your great Google rank is extremely risky -- and if your only backup strategy is to sue Google for not ranking you higher, it suggests that your business strategy needs a pretty massive rewrite."
Posted by Eric at 11:00 AM | Licensing/Contracts , Search Engines | Comments (1)
June 03, 2006
Denver IP Summit Presentation
By Eric Goldman
I attended the Denver Summit on Intellectual Property and Digital Media. The audience was principally cable industry participants, but there were plenty of content creators (and legal academics) in attendance. I spoke about the various ways that content creators can "protect" their content online. My slides.
Posted by Eric at 01:59 PM | Copyright , E-Commerce , Licensing/Contracts
June 02, 2006
Search Engines Awarded Legal Fees in Unmeritorious Copyright Case--Newborn v. Yahoo
By Eric Goldman
Newborn v. Yahoo, 2006 WL 1409769 (D.D.C. May 23, 2006)
I blogged about this case in November 2005. At that time, the plaintiff sued Yahoo and Google under copyright and trademark law because the search engines had indexed the plaintiff's press releases. However, the complaint was so defective that the court dismissed the case out of hand.
As a follow up to that quick win, Yahoo and Google sought their legal fees for defending the lawsuit. Both the Copyright Act and the Lanham Act have statutory "loser pays" provisions, although the Lanham Act's standards are more demanding than the Copyright Act's standards. Based on the prevailing standards, the court awarded Yahoo and Google their legal fees associated with defending the copyright infringement claim but not the trademark claim. Yahoo and Google also sought to have the plaintiff's attorney personally liable for some/all of their fees, but the court declined to extend liability to the attorney. I suspect letting the attorney off the hook reduces the likelihood that the search engines will actually see any cash; these types of plaintiffs tend not to have a lot of extra cash lying around.
Nevertheless, the plaintiff likely will be exposed to tens of thousands of dollars in legal fees (the exact number will be determined when the search engines segregate their costs of defending the copyright and trademark claims). This is a good reminder to plaintiffs that bringing a copyright infringement (or even a trademark infringement) claim is a serious matter with potentially significant ramifications. Specifically, as I wrote in my November post, "If you're going to sue Google or Yahoo for indexing practices, get a top-notch lawyer."
Posted by Eric at 07:42 AM | Copyright , Search Engines , Trademark
June 01, 2006
NYT on Fair Use and Documentaries
By Eric Goldman
The NY Times runs an article on documentaries and fair use. It describes the thicket of copyright clearances necessary to reuse film clips in documentaries, which can be fatal to a documentary project. It gives one example where a 2 minute clip costs $20,000. In other cases, the licensing agreements limit the documentary's ability to comment negatively or to use the clip in an NC-17 film. In some cases, the license requires further permission for different distributions of the documentary.
The solution? Fair use could provide some breathing room, but it's a notoriously dangerous doctrine to rely upon--especially in the context of revenue-generating documentaries. Fed up with the high licensing fees, one documentary producer went to the applicable studios and said: "$1,000 licensing fee or we rely on fair use and you get nothing." 13 of 18 studios signed up, but that still leaves 5 plaintiffs. Further, this type of "take it or leave it" gambit could be especially risky when viewed by the courts. Fair use is an equitable doctrine, so judges may not be impressed by a documentary producer's strongarm; and the offer of a license fee implicitly acknowledges a secondary market for the licensing of clips. (MIke Madison sees this differently than I do). On the other hand, if 18 permissions are necessary, then any one copyright holder could stop the project entirely or extract all remaining profits for itself, and the fair use doctrine could help prevent these hold-up games.
The article mentions some efforts to develop standards for fair use in documentaries. It would be a great win for the documentary industry if the studios could sign up to such a program. I'll be surprised, however, if studios are willing to give up any control--that would be a major attitude shift. And without universal buy-in, the validity of any industry norms still will be subject to judicial review and possible disapproval.