April 30, 2008
Ripoff Report Folks Sue Newspaper and Reporter for Defamation--Xcentric Ventures v. Village Voice
By Eric Goldman
I've lost count of the number of times I've blogged on lawsuits involving Ed Magedson and related entities Xcentric Ventures, the Ripoff Report, badbusinessbureau.com and others. Certainly they seem to get sued a lot, especially for defamation, as Sarah Bird documented here. If I spent that much time in court, the last thing I’d want to do is bring a lawsuit. But as Sarah Bird’s report enumerates, Magedson and his group have gone on the offensive a few times. Some people just seem destined to spend their lives litigating.
This lawsuit relates to a lengthy and in-depth article on Magedson and the Ripoff Report written by Sarah Fenske that published in February 2007. (I mentioned this article in a blog post here.) To minimize my risk of being the next defendant, I won't restate the allegedly defamatory language, but it involves a purported quote of Christopher Sharp, a Florida attorney representing Whitney Information in their lawsuit against the Ripoff Report group. See pages 3-4 of the complaint. Not only did the plaintiffs sue the story's publisher (the Phoenix New Times and its parent the Village Voice), but they sued the reporter Sarah Fenske and her husband (as a Doe to be named later) as well.
On the one hand, I understand why the Ripoff Report group sued over these quotes. I suspect the Phoenix New Times article already has been cited in various plaintiffs' briefs, and I'm sure that future plaintiffs will continue to do so unless the Ripoff Report group clears their names and establishes the falsity of Mr. Sharp's allegations.
On the other hand, I thought this lawsuit was rich with irony. In earlier drafts of this post, I had a long list of ironies, many of which I ultimately decided were too snarky even for me. You'll have to use your imagination. Instead, I've decided to focus on just two odd aspects of this lawsuit.
Why Sue the Intermediary?
According to Sarah Bird's report, Magedson filed a lawsuit against Sharp in February 2007. I haven't seen the complaint or other case documents, but given the timing I suspect that the lawsuit involves his article quotes (and maybe other issues). The complaint says that Mr. Sharp now "contends that the quotes attributed to him were taken out of context and/or were improperly quoted," so perhaps the plaintiffs now feel that Sharp has adequately recanted. Either way, a lawsuit against Sharp should be adequate to clear the Ripoff Report's name.
As a result, unless the Phoenix New Times completely fabricated the statement (which the complaint didn’t allege), the plaintiffs should be satisfied pursuing only Sharp. Indeed, if a company has a problem with a user-supplied report published on Ripoff Report, the Ripoff Report folks say to take it up with the user and leave the Ripoff Report out of it. When the shoe is on the other foot, why did the plaintiffs go after the intermediaries as well?
Ripoff Report owes its existence to 47 USC 230. Without that immunization, Ripoff Report almost certainly would have been sued to oblivion. But 47 USC 230 is an exceptionalist statute available only to online media companies. Offline media companies don't get the same protection, creating a regulatory imbalance that puts offline print publishers at a competitive disadvantage. See Randy Picker’s comments on this point.
So if the Phoenix New Times had published the allegedly defamatory third party quotes only in its online edition, it should have been clearly and fully insulated by 47 USC 230 (as the plaintiffs well know because they helped create some of the expansive 230 precedent that would apply). In contrast, the plaintiffs can bring this lawsuit only because the Phoenix New Times also chose to publish the exact same article in its dead trees edition. I understand that 230 creates this medium-specific dichotomy in defamation law, but if it were my decision, I wouldn’t want to take advantage of it.
UPDATE: I've posted the complaint in Magedson v. Sharp.
UPDATE 2: See the response from Ripoff Report's general counsel.
April 29, 2008
Kaspersky Files Answering Brief in Zango v. Kaspersky
By Eric Goldman
Continuing my coverage of the Zango v. Kaspersky litigation over 230(c)(2), Kaspersky has filed its answering brief (warning: 5MB file). If you want to save time, the actual argument starts on page 32 of the PDF.
The case library:
* National Business Coalition on E-Commerce and Privacy amicus brief in favor of Zango
* Zango's appeal brief [warning: 2.1MB file]
* The district court's dismissal and my commentary
* TRO Denial and my commentary
* Kaspersky's Response to TRO Motion
* Zango's TRO motion
Wikipedia Ethics Event, May 15 at SCU
By Eric Goldman
The High Tech Law Institute is cosponsoring (along with the Center for Science, Technology and Society and the Markkula Center for Applied Ethics) the following event:
The World that Wikipedia Made: The Ethics and Values of Public Knowledge
May 15, 2008, 6.30-8.00 p.m., de Saisset Museum, Santa Clara University
Speakers: Mike Godwin (GC of Wikimedia and one of the pioneers of Cyberlaw) and Carl Hewitt. Pedro Hernández-Ramos will moderate.
Admission is free; parking is $6. RSVPs aren't required.
More details about the event and bios for the participants.
This event should be a great opportunity to explore the ethical, legal and credibility issues associated with Wikipedia's editing structure (something I've critiqued before). I haven't heard Carl speak before, but I can confirm that Mike Godwin is a brilliant and entertaining speaker.
April 28, 2008
47 USC 230 Trifecta of Cases--Friendfinder, e360insight, iBrattleboro
By Eric Goldman
47 USC 230 cases have been coming at such a rapid clip that I've fallen behind. In this blog post, I'll catch up on three recent cases:
Doe v. Friendfinder Network, Inc., 2008 WL 803947 (D.N.H. March 27, 2008)
This case involves the publication of a false user-supplied profile on adult dating/hook-up services operated by AdultFriendfinder and Various. Fake dating profiles have been the source of a fair amount of 230 litigation; see, e.g., the Anthony v Yahoo, Landry-Bell v. Various, Doe v. SexSearch, Barnes v. Yahoo, and of course the Carafano case. The Friendfinder case involves two allegations we haven't seen before: (1) when the plaintiff complained, the sites removed the profile but displayed the following message on the profile page: "Sorry, this member has removed his/her profile," which allegedly implied that the plaintiff in fact had authorized the page initially, and (2) portions of the fake profile had been displayed on third party sites as "teasers" to advertise the adult dating services.
The court quickly dismisses the defamation, intentional infliction of emotional distress and various soft tort claims per 230, even if the defendants affirmatively reposted the profiles and even with respect to pull-down menus used to help profile building. This opinion came out before the Ninth Circuit en banc ruling in Roommates.com, but taking Kozinski's disclaimers at face value, the discussion about pull-down menus should have survived Roommates.com.
The court also says that 230 protects the site-authored announcement on the removed profile because "the allegedly tortious nature of those statements proceeds solely from the association they create between the plaintiff and the content of the profile." This might be an important standard to help future courts determine when 230 governs allegations of false marketing representations predicated on bad user info.
The court takes a less defense-favorable direction regarding the right of publicity claim. In direct conflict with the Ninth Circuit's ccBill ruling, this court says that 230 does not preempt state IP claims. Personally, I think this court got the statutory construction right and the Ninth Circuit got it wrong. As this court correctly explains, a court cannot interpolate the word "federal" into 230(e)(2) if it uses intellectually rigorous statutory interpretation.
Having left open the state IP claims, the court (also correctly, IMO) says that a right of publicity claim is an IP claim while any other invasion of privacy claim (i.e., the other three prongs of Prosser's four privacy torts) is not.
The court also survives the plaintiff's allegation of a Lanham Act false designation of origin claim with respect to the use of the false profile in the advertising teasers. But why didn't the court examine the application of 230 to this Lanham Act provision, which arguably isn't an IP claim? I think the court considered the false designation of origin claim, as applied to a false endorsement, to be equivalent to a right of publicity claim, but it would have been nice for the court to unpack this assumption.
The litigation over teaser content raises a question that's been bothering me for some time--when is republication of user-supplied editorial content (in this case, the dating profile) as teaser content on third party websites legally governed as commercial advertising? Teaser editorial content is ubiquitous, but it also serves a marketing function that could (should?) be regulated by commercial advertising restrictions such as the right of publicity. Hey, if you're looking for a paper topic, I think this issue (use of user content in teaser content as a right of publicity issue) is a good one.
e360Insight, LLC v. Comcast Corp., 2008 WL 1722142 (N.D. Ill. April 10, 2008)
e360 is an email marketer/alleged spammer. Comcast blocks their emails from getting to Comcast subscribers. e360 sues Comcast for a variety of torts. The court sweeps all of the claims away on a judgment on the pleadings per 230(c)(2), saying that spam filtering constitutes the blocking of objectionable content contemplated by the statute. Further, agreeing with the Kaspersky case, the court says that any good faith requirement in the statute is subjective, not objective, and e360 didn't plead any evidence of subjective bad faith. Case dismissed.
This opinion adds to the burgeoning caselaw under 230(c)(2) showing that it will crunch claims by anyone upset that their communications are being filtered. As applied to an IAP like Comcast, I think this raises an interesting angle in the net neutrality debate. If you're looking for a paper topic, it seems like it would be timely to recap 230(c)(2) jurisprudence and analyze its interplay with other speech-preserving doctrines (must-carry laws, Constitutional free speech restrictions, net neutrality, consumer protection requirements of disclosure, etc.).
Mayhew v. Dunn, 580-11-07 (Vt. Superior Ct. March 18, 2008)
This is a simple and clean opinion. The defendants operate the iBrattleboro.com website. A third party posted material to the website that allegedly harmed the plaintiff. The website operators get a judgment on the pleadings. Case dismissed. This is a nice illustration of 230 working exactly as it should. Some useful color on the case from CMLP.
April 26, 2008
Injunction Requires Negative Keywords in Future Adwords Campaigns
By Eric Goldman
Orion Bancorp Inc. v. Orion Residential Finance LLC, 2008 WL 816794 (M.D. Fla. March 25, 2008).
It looks like courts/lawyers are finally getting savvier about broad matching (see my previous blogging on the legal understanding of broad matching in the Rhino Sports, Hamzik and Picture It Sold cases). In a default judgment over trademark infringement using the term "Orion," the plaintiff's lawyer got the judge to order a restriction on the defendant:
from purchasing or using any form of advertising including keywords or “adwords” in internet advertising containing any mark incorporating Plaintiff’s Mark, or any confusingly similar mark, and shall, when purchasing internet advertising using keywords, adwords or the like, require the activation of the term “ORION” as negative keywords or negative adwords1 in any internet advertising purchased or used.(emphasis added)
According to this injunction, then, if the defendant buys the keyword 'bank" and broad matches it, the ads still should not show up for a search on the term "Orion Bank." Perhaps there have been other injunctions with similar requirements to use negative keywords, but this is the first I've seen. (I did a search in Westlaw on the term "negative keyword" and this was the only injunction I found). Going forward, I think it's a logical addition to any injunctive relief request in a trademark infringement case.
HT: Tom O'Toole
UPDATE: Sarah Bird provides some helpful context for the injunction.
April 24, 2008
Court Says Keyword Metatags Don't Matter--Standard Process v. Banks
By Eric Goldman
Standard Process, Inc. v. Banks, 2008 WL 1805374 (E.D. Wis. April 18, 2008)
SEOs and SEMs have known for years that most search engines ignore or give minimal acknowledgement to keyword metatags. Lawyers, on the other hand, have been living in a parallel fantasy universe where keyword metatags single-handedly divert unwaveringly brand-loyal customers to piratical competitors. Even today, many courts still rely on the 1999 Brookfield case and its dreadful keyword metatags-as-a-false-billboard analogy as an accurate and definitive statement of how search engines operate today. Prime offender #1: the recent 11th Circuit hairball in National American Medical v. Axiom, where the court may not have even understood the difference between keyword metatags and description metatags.
Despite this, defendants have occasionally defeated trademark claims over their inclusion of third party trademarks in the keyword metatags based on a variety of theories, including a lack of a use in commerce (ex: Site Pro-1, S&L Vitamins), insufficient likelihood of consumer confusion (ex: JG Wentworth), nominative use (ex: Welles) and others. But as far as I can recall, no court had rejected a keyword metatag for the right reason, which is that they are technologically ineffective.
That's why this new opinion appears to break important new ground. The court, citing this paper and Prof. McCarthy's treatise, rejects the argument that keyword metatags create initial interest confusion, in part because keyword metatags are immaterial. Hooray! Hey all of you lawyers still citing to Brookfield for its description of search engine operations, I think you need to acknowledge this case now too.
The rest of the case is really interesting too, with facts highly similar to the Australian Gold cases (see S&L Vitamins v. Australian Gold; Australian Gold v. Hatfield). The plaintiff makes dietary supplements. Through its distribution agreements, it tightly controls its channels to limit retailing to healthcare providers and, not incidentally, preserve high margins; thus, all authorized distributors are prohibited from making Internet sales. The defendant once was an authorized distributor but was kicked out of the chain for selling over the Internet. In response, the defendant bought supplies from other authorized distributors (who were contractually barred from reselling to distributors selling via the Internet) and continued offering the products via his website. The manufacturer is now suing the website for selling these legitimate goods that leaked out of the authorized channel.
As I've mentioned before, efforts to preserve high margins through anti-Internet channel control are doomed. Some of the lawsuits might succeed in controlling the channel in the short run, but Internet competition will prevail, like it or not, and supra-competitive margins will be a relic of the past.
In any case, under the trademark exhaustion/first sale doctrine, the defendant may resell the legitimate goods so long as consumers are not confused about a sponsorship relationship between the manufacturer and distributor.
(That's not to say that the defendant has the right to buy the goods. If the plaintiff really cares about the channel conflict, the plaintiff can clamp down on the authorized distributors who are leaking the goods to the defendant and therefore dry up the defendant's supply. But it may have to do so without the aid of trademark infringement claims.)
So, the main issue in this case is whether consumers will be confused about a sponsorship relationship between the manufacturer and the website. The court says no with respect to website sales where the defendant didn't show any product shots and included a prominent disclaimer. In contrast, consumers may be confused by the defendant's emails touting the products when the emails included product shots but didn't have a prominent disclaimer. On that basis, the defendant accepted, and the court ordered, an injunction against further promotion of the product without the disclaimer.
This relatively narrow injunction makes some sense, but I'm still confused why the court discussed the product shots. (The plaintiff is also confused why the defendant wasn't enjoined from using product shots, and yesterday it filed a motion to amend the injunction to include a restriction on product shots). I don't see how the inclusion of product shots can communicate some actual/implied sponsorship between manufacturer and retailer. If the takeaway from this case is that a retailer of legitimate goods that leak out of the channel can't display product shots, it seems like this would hurt consumer decision-making, not help it.
April 23, 2008
Two Open Positions at the High Tech Law Institute, Santa Clara University
By Eric Goldman
We're hiring! Please send interested candidates to the online job descriptions and application mechanism.
The High Tech Law Institute (HTLI) is the umbrella organization that sponsors and helps administer Santa Clara University School of Law's well-regarded program in high tech and intellectual property law. Among other duties, the HTLI manages SCU's rich curriculum of high tech and IP courses and offers events for academics, Silicon Valley lawyers and others.
The HTLI is looking to fill two important administrative positions:
1) Assistant Director of the HTLI. See the job description.
2) Program Manager, HTLI. See the job description.
Each position provides an excellent opportunity for a motivated and entrepreneurial individual to play a pivotal role in defining and enhancing the services provided by the HTLI.
Interested applicants should submit an online application via the "apply" button at the end of the job description. We are considering applications as they arrive, so applicants are encouraged to apply as soon as possible. We would be very grateful if you could help spread the word!
Santa Clara University is an Equal Opportunity/Affirmative Action employer, committed to excellence through diversity, and, in this spirit, particularly welcomes applications from women, persons of color, and members of
historically underrepresented groups. The University will provide reasonable accommodations to all qualified individuals with a disability.
Online Advertising Conference Recap
By Eric Goldman
Last Friday, the High Tech Law Institute and the Berkeley Center for Law & Technology co-sponsored the Law & Business of Online Advertising conference. We had first-rate panelists and an enthusiastic audience of over 100 attendees. Rebecca blogged the event (tutorials, consumer issues, publisher issues, advertiser issues) and Sarah Bird posted her own recap. My understanding is that BCLT will post the audio from the conference to the conference website in the near future.
I'm going to focus my recap on just three of the talks.
Joel Winston from the FTC (speaking for himself, not on behalf of the commission) spoke on the consumer issues panel. He said that consumers have a feeling of lack of control on the Internet. He thinks that consumers are generally aware of online tracking, but the tracking process is opaque, and consumers don't understand the future implications for use and disclosure of the tracked data. Surveys say that most consumers think tracking shouldn't be done at all or should be governed by an opt-in or opt-out process. Many people like targeted ads but they are worried about other uses of the data, such as security breaches, government misuse and secondary uses.
So consumers want transparency and control, and trust is the key. Adults are concerned about posting data online but kids will post very intimate details online. People don't understand the privacy tradeoffs, such as the connection between targeted ads and free content. And transparency isn't working when consumers don't read privacy policies. Self-regulation is the right approach, but the FTC will step in to protect consumers.
The FTC's behavioral principles:
* transparency and control
* reasonable security and limited data retention
* express consent to use sensitive data.
Mark Cooper spoke about an interesting new paper he's working on. He starts with the premise that everyone hates "interruption marketing" such as TV ads: consumers hate TV ads (interruptive) and advertisers hate TV ads (can't measure efficacy). In contrast, he thinks newspaper ads are clearly better because they are easy to skip, easy to store and contain more useful information. [Eric's note: Mark is making a highly stylized argument. I explored the relative merits of different ad media in this paper.]
He thinks online advertising can improve on interruption marketing because the Internet is a two way conversation, not push marketing. He outlined 4 dimensions to measure the acceptability of advertising:
* influence. Online advertisers don't create audiences, they chase audiences created for them.
* intrusiveness. Online advertising isn't in the "middle of content." [Sounds like Mark has never experienced an unconsented adware install...and I'm not sure how he'd explain spam in one's in-box...] But he worries that data collection may be more intrusive than other media.
* ubiquity. I think he argued that online advertisers don't devote as much on-the-page real estate to ads as newspapers do. [Sounds like he's never been to a domainer's website...]
* efficiency (delivery of useful information). The cost of online advertising is less than TV, which expands the market for advertisers. This also facilitates the creation of hyper-niche content sites.
Despite some of the benefits of online advertising, he worries about how much information he needs to give up to get these improvements. He thinks behavioral targeting and tracking is inherently deceptive but in-session contextual advertising is OK, and maybe informed consent may be OK.
* I'm not sure the four dimensions he uses are the right dimensions to measure advertising
* His arguments relied on a number of assumptions that aren't very robust, which limits the extensibility of his analysis.
* I think the statement that behavioral tracking is inherently deceptive must be overstated for rhetorical emphasis. Otherwise, I don't think that statement stands up to critical scrutiny.
* I argue (in great/excessive detail) that some types of behavioral targeting are both good and inevitable in this paper.]
Rebecca Tushnet spoke on intermediary liability. She made two main points:
1) Intermediaries aren't good representatives of the speakers who they facilitate because the intermediaries are adverse to their users. Ex: the 512 notice-and-takedown provisions, Google's policy on TMs in ad copy.
She thinks there may be merit to looking at the New York Times v. Sullivan case, which people sometimes forget is an advertising case (i.e., the plaintiff was trying to hold the newspaper liable for ad copy supplied by an advertiser). The newspaper wasn't liable in that case unless it had actual malice about the definition--a very high scienter bar. Perhaps the actual malice standard could be more widely used in the online context; among other benefits, notice alone wouldn't create liability.
April 22, 2008
March 2008 Quick Links, Part II
By Eric Goldman
* Ticketmaster L.L.C. v. RMG Technologies, Inc., 2008 WL 649788 (C.D. Cal. March 10, 2008). Copyright misuse is not an independent cause of action; it's only a defense. HT Evan Brown.
* A student asked me a good Q that I couldn't answer. Given that copyright work transfers are subject to the risk of a non-waivable termination of transfer 35-40 years after the transfer, how do companies account for that risk on their financial statements?
* A man whose Youtube video was taken down by lawyers for Van Morrison strikes back with a new video: "The Lawyers Pulled My Video Down."
* Wilson v. Yahoo! UK Ltd., No. 1HC 710/07, Feb. 20, 2008. A UK court says that buying the broad-matched keyword "spicy" does not constitute an actionable use in commerce of the trademark "Mr. Spicy." In response, Google liberalized its keyword policy in the UK and Ireland to match its US and Canada policy.
* Vulcan Golf, LLC v. Google Inc., 2008 WL 818346 (N.D. Ill. March 20, 2008). This is another interesting development that I just didn't have time to blog (see my earlier post when the lawsuit was filed). In a lengthy opinion, the district court rejected most of the significant motions to dismiss, saying that she wanted to let the case develop. Ironically, she also complained about the workload in the case--perhaps this is obvious, but granting some motions to dismiss would help clear your docket queue! Unfortunately, most of the opinion isn't insightful because so many issues were reserved for further development. Perhaps the most interesting discussion relates to the "use in commerce" question, and the court rejected a motion to dismiss on that basis: "The plaintiffs have alleged that Sedo and the other Parking Defendants transacted in and improperly profited from domain names that are deceptively similar to the plaintiffs' trademarks. Such statements sufficiently allege the "use" of a domain name to allow the infringement claims against Sedo and Oversee to move forward on this issue." Some other commentary on the case: Sarah Bird and David Fish.
State Regulation of the Internet
* Some state legislators are becoming privacy entrepreneurs about behavioral targeting. Venkat does a recap. But Zachary Rodgers points out that some of the operative provisions track NAI's self-regulatory guidelines. More angst about deep packet inspection by IAPs.
* Ewert v. eBay, Inc., 5:07-cv-02198-RMW (N.D. Cal. March 31, 2008). eBay isn't an "auctioneer" or an "auction company" as defined by California's Auction Act.
* Ken Magill at Direct wrote an article entitled "Psychotic Law Clowns in Utah at it Again." A highlight: "Whenever I think of Utah's state legislature, I envision a room full of Jack-in-the-Boxes straight out of a never-made Twilight Zone episode. Every fall, when it's time for the next legislative session, their cranks begin to turn, a chorus of "Pop Goes the Weasel" begins, and on the note for "pop" the lids fly open and dozens of psychotic clown heads spring out of the boxes chanting: "New Internet Law! New Internet Law!""
* The Economist: The Battle for Wikipedia's Soul. "To create a new article on Wikipedia and be sure that it will survive, you need to be able to write a "deletionist-proof" entry and ensure that you have enough online backing (such as Google matches) to convince the increasingly picky Wikipedia people of its importance. This raises the threshold for writing articles so high that very few people actually do it. Many who are excited about contributing to the site end up on the "Missing Wikipedians" page: a constantly updated list of those who have decided to stop contributing. It serves as a reminder that frustration at having work removed prompts many people to abandon the project." See a similar article in the NY Times Review of Books.
* FTC busts Goal Financial for inadequate security practices.
* The DOJ is busting people who click on a link that purportedly offered child porn, prosecuting them for attempted downloading of child porn.
* Orin Kerr, "Criminal Law in Virtual Worlds," University of Chicago Legal Forum (forthcoming). Orin sensibly argues against virtual world exceptionalism with respect to criminalizing activities in virtual worlds.
April 21, 2008
Still Standing? Catching Up on the Jaynes Case
By Ethan Ackerman
Virginia's 1st-Amendment-deficient Spam law is still standing, but only because the Va. Supreme Court closely split over whether Jeremy Jaynes had standing to challenge it.
A cynic could dismiss the most recent ruling in this fairly well-covered and dissected criminal spamming case with the familiar legal adage - "bad facts make bad law." But cynics never read this blog...
So what happened?
Jeremy Jaynes was apparently quite the spammer, until he got caught in 2003 sending large volumes of commercial solicitations to AOL users via email messages with forged or misleading headers and From: addresses. As a result, he was charged with criminal violations of Virginia's spam laws. The initial appeal in this case was covered in an earlier post.
At the Va. Supreme Court, Jaynes brought up the same three primary challenges (lack of jurisdiction, Dormant Commerce Clause violations, and 1st Amendment overbreadth/vagueness violations) he raised at the Court of Appeals. He had the same unsatisfactory (for him) results. This previous post detailed where the Va. Court of Appeals' resulting opinion left things wanting on the First Amendment and jurisdiction front. If all was the same old-same old, however, I wouldn't be writing a separate post on the Va. Supreme Court's follow-up ruling. This opinion is a bit more rigorous, but runs into trouble (in my, and the 3 dissenters', minds) over First Amendment issues. As a result, this post is only going to focus on the First Amendment issues of the case. Spam law junkies looking for Dormant Commerce Clause, CAN-SPAM, or jurisdiction issues can read the next paragraph and then go here instead.
Hey wait? What about CAN-SPAM?
Astute readers may wonder where or if the federal anti-spam law comes into play here. The spamming in question took place in July 2003, before the passage of the effective date of the federal CAN-SPAM Act. While there's some question as to what degree this case, and other state laws on spam, could have been preempted by the federal anti-spam laws if it'd happened later, CAN-SPAM wasn't a retroactive law, and it didn't offer retroactive immunity.
On to the First Amendment (or outside it, in this case)
On appeal, Jaynes argued that the Virginia anti-spam statute swept overly broad in prohibiting some types of protected speech, in violation of the First Amendment. Virginia's particular prohibition on mislabeling or falsity in emails, commercial or otherwise, makes it particularly vulnerable to a First Amendment challenge. In fact, I'll come right out and say it: by not limiting itself to commercial emails, the law is almost certainly sweeping in emails that are protected under the First Amendment along with the unprotected fraudulent commercial speech that it can target.
There is vigorous First Amendment debate over each of the issues at play here. What degree of First Amendment protection does commercial speech have? Does commercial email get a different amount than other commercial speech? Does it matter if it's false? Misleading? Just in the headers, not in the content? Who decides? What if the emails are unsolicited, or sent in bulk? What if their headers are forged or altered? What if they're not commercial, but are still bulk? What if they're political? What if the 'altering' is just done to make the email effectively anonymous? Many spam cases at the state and federal level have turned on these distinctions. And the last issue - the scope of the First Amendment right to anonymous speech - drew a brief from the Virginia ACLU at each stage.
While the initial appellate opinion dealt unsatisfactorily with some of these issues, the Va. Supreme Court almost entirely sidestepped them. The Court found Jaynes' lacked 'standing' to even raise a First Amendment challenge to the law, and so declined to address the appeals court's findings on the merits of Jaynes' First Amendment claims. The funny thing is, in going out of its way to only decide standing and avoid a ruling on the merits, the Va. Supreme Court had to make almost all the legal and factual findings necessary to decide the merits.
A quick primer on Standing
'Standing' is a legal term of art that means it is proper for a particular person to be in court contesting something. Courts are vigilant about standing issues because most constitutions, state and federal, require that a particular person have it before they can challenge a law or bring a suit against another person. Standing decisions are also used to avoid deciding thorny issues before they're clearly at hand, or sometimes to avoid them altogether if the issue or law doesn't really apply to the person making the claim.
Take an animal lover in New York City, a wildlife watcher in Laramie, a commercial wildlife-watching guide operating in Yellowstone National Park, a wildlife biologist studying wolves at the University of Wyoming, and a wolf rancher operating a private free-range wolf farm outside of Cheyenne. Each of these people might be upset and allege harms related to a Wyoming statute that mandates the shooting of wolves. The law distinguishes between each of these categories by recognizing some and not others according to the principle of standing.
When someone is unfairly targeted by the way a law is enforced, or is actually prevented from doing something, or has been charged with committing a crime, they likely have standing to challenge the law - as it was applied to them. This is called an "as-applied" challenge to a law. It is a challenge only to the particular portion of the law applied to them in their particular facts and circumstances.
When a skateboarding youth contests her citation for loitering at the public park every time she joins up with her friends for a some skating, she's probably not alleging that the entire loitering statute is unconstitutional, or that the police can never issue a loitering ticket, but that a particular biased police officer is unfairly targeting her in a certain way that violates her First Amendment associational rights. This is an example of an "as applied" challenge.
On the other hand, in some cases a suit can be brought challenging a law outright, outside of a criminal or enforcement action. This particular head-on challenge is called a "facial" challenge to a law, and means that the law, as it is written, violates some other law or Constitutional principle. Facial challenges to a law are much less frequent precisely because many times standing is lacking. If Rosa Parks had sued Alabama over its bus segregation laws before she had ever been sent to the back of the bus, she would have had to allege that the law was unconstitutional "on its face," since it hadn't yet been "applied" to her.
Related to a facial challenge is an "overbreadth" challenge. It alleges that a partially acceptable law sweeps 'overly broad,' catching protected activities up along with those that may legitimately be restricted. A "no leafleting without a name and address on the leaflet" law might be constitutional when enforced against a commercial door-to-door vendor, but not when enforced against a political pamphleteer. These different types of challenges matter because many times whether or not a person has standing depends on what type of challenge - facial, as-applied, or overbreadth - they are bringing.
A breath-taking run through the First Amendment 'overbreadth' exception to standing rules.
As succinctly admitted by the Va. Supreme Court in Jaynes, a litigant may have standing to raise an 'overbreadth' claim against a statute even if they did not have standing to raise a facial or as applied challenge, because "the United States Supreme Court has recognized an exception to the ordinary rules of standing when Constitutional claims involve the First Amendment."
Why relax the otherwise good and useful principle of standing? If it works, it works, right? In general yes, but when it comes to speech, extra protection is a good thing, and chilling speech, even potentially, is a bad thing according to the Supreme Court. Better an occasional court case that is somewhat hypothetical than a wide-sweeping law that makes people reluctant to speak because they might step afoul of it. As the US Supreme court explained in Broadrick v. Oklahoma,
Litigants, therefore, are permitted to challenge a statute not because their own rights of free expression are violated, but because of a judicial prediction or assumption that the statute’s very existence may cause others not before the court to refrain from constitutionally protected speech or expression.
So the First Amendment "overbreadth" exception to standing serves to protect against laws that may chill speech. It's clearly a First Amendment protection device, and it's also clearly a procedural exception developed by courts. But which of those is it more like? That seemingly odd question turns out to make all the difference for Jeremy Jaynes' conviction.
A (not Constitutional?) means to a Constitutional End
If the overbreadth exception is an element of federal Constitutional law arising from the First Amendment, state (and federal) courts generally must follow it. Further, any prior Supreme Court rulings on the issue are binding on state courts as well. However, if it is just a rule of standing, albeit one that happens to protect important First Amendment interests, then state courts are generally free to apply it or reject it according to the laws of their own state. Much like setting filing fee prices, or specifying the number of days in which a motion must be filed, or whether a particular state recognizes "psychotherapist-client" privilege, standing rules can and do vary from state to state.
So is the overbreadth exception required by the First Amendment, or is it just a procedural rule that can be varied by pretty much any court or a state legislature? This kind of distinction - where a remedy or process guards a Constitutional right but (is or) isn't mandated by the Constitution - pops up in quite a few important Constitutional cases. Shockingly enough, reasonable people disagree, both in the US and in other countries with free speech laws facing similar questions.
Perhaps the most obvious US example of this distinction, and a helpful analogy, is the status of several procedural protections under the Fourth Amendment prohibition on warrantless searches. If police violate (or just plain don't get) a warrant but search a suspect or her premises anyway, does the Constitution require that any evidence seized be suppressed? Can the victim of the illegal search sue the police? The Supreme Court goes several ways depending on the question. In at least some cases, the Constitution itself provides a "Constitutional" right to sue, in other cases the suppression "remedy" or standing to sue turn on statutes or standing rules that may vary from state to state to federal law.
These types of inconsistencies seem to be creeping into overbreadth doctrine as well, with some legal scholars warning against the trend away from a Constitutional view and toward a 'mere' procedural standing view. The same challenge seems to be facing other common-law countries with free speech rights as well.
OK, OK, the answer already...
It turns out that the US Supreme Court may have already answered this particular question - or at least suggested a likely answer. In Virginia v. Hicks, even though the Court was ruling on the question of the degree to which enforcer discretion rendered a 'no loitering' statute overbroad, the Court also stated that state court standing rules, not the First Amendment or any other Constitutional considerations, determined whether the Virginia court even had to hear Hicks' overbreadth challenge. According to a brief paragraph in the unanimous majority opinion written by Justice Scalia, "Whether Virginia’s courts should have entertained this overbreadth challenge is entirely a matter of state law." The Virginia Supreme court says this answer is good enough - Virginia courts can choose whether to hear an overbreadth challenge.
But is this the full answer? Hicks is admittedly an on-point ruling on an overbreadth challenge. But is this really the best way to take Justice Scalia's preliminary (precatory?) statement? Concluding that state court protections of 1st Amendment rights are optional makes no sense. See Amendment 14, U.S. Constitution. Perhaps a better reading is that in Hicks, Scalia was saying that the Virginia court was free to choose whether to step above the federal constitutional overbreadth 'floor' and choose or decline to hear Hicks' overbreadth challenge because then-existing overbreadth doctrine didn't cover Hick's challenge. This 'overbreadth doctrine standing is a floor, not a ceiling' argument is perhaps the better reading.
To the State law, then...
In Jaynes, the Va. Supreme Court seized on the Hicks language in an effort to avoid admitting the Virginia spam statue is overbroad and infringes on the First Amendment. But how?
In a word, narrowly. 4-3, the state Supreme Court declined to hear Jaynes' First Amendment claims by holding that Virginia state law only required that overbreadth standing be granted to someone actually able to allege the statute in question was unconstitutional 'as applied' to them - effectively collapsing overbreadth challenges in state court into an 'as applied' challenge - at least in commercial speech cases. Of course the majority didn't couch its opinion like that, taking pains to state that the opinion preserved overbreadth standing in most cases but only denied it to those commercial actors whose speech was clearly outside of the protections the First Amendment grants commercial speech.
Wait, I thought they weren't going to decide the First Amendment issue?
There are several shortcomings with the Jaynes majority opinion. The most glaring inconsistency is the choice to decide that Jaynes' commercial speech, by virtue of its falsity or tendency to mislead, isn't the type of commercial speech entitled to First Amendment protection. The court says:
Jaynes’ commercial speech would fail the initial requirement for First Amendment review under Central Hudson Gas and Fox because it is “misleading” on its face. In that circumstance, it is reasonable not to accord the speaker of such misleading commercial speech, admittedly unprotected in its own right, standing to vicariously raise the First Amendment claims of others.
At first glance, this seems reasonable - it is, after all, a correct statement of First Amendment law under the so-called Central Hudson test. The Supreme Court's various First Amendment commercial speech tests all use truthfulness and non-deceptiveness as an initial threshold, one of the more certain principles in this somewhat varying field. Jaynes' commercial spamming rather clearly fell on the false/misleading/illegal side of the First Amendment line.
That non-controversial decision was a decision on the underlying First Amendment issue in the case, however. It is exactly what the Virginia Supreme Court majority was saying couldn't be made because Jaynes lacked standing. Jaynes petitioned the court to address the First Amendment issue of overbreadth. The Virginia Supreme Court declined, concluding "Because we hold the standing issue is dispositive, we do not address the [First Amendment merits] analysis." In other words, Jaynes lacked standing to raise a First Amendment issue, and so it would be inappropriate to rule on that First Amendment issue. But to come to that standing conclusion, the Court decided the First Amendment issue of whether Jaynes' speech was the type of speech entitled to First Amendment protection.
So what else is wrong?
The three member dissenting opinion of the Virginia Supreme Court (from p. 33 on) takes issue with the majority ruling. It does so not on the tangential issue of its internal inconsistency I raised, but head on. To paraphrase the dissent, 'you've got it wrong, there's a reason every other court, state and federal, does it the other way.' The dissent delves into the important First Amendment principle of avoiding laws with a chilling effect on speech. It reiterates that this vital principle is the reason for an exception to the general standing doctrines. The dissent emphasizes the inconsistency between state and federal law on this issue. The dissent notes, and wisely the majority previously conceded, that in federal court Jaynes would have had standing. That's not just inconsistent, the dissent notes, but it will push cases construing Virginia statutes out of Virginia courts (where they now can't be brought) and into federal courts. It's Virgina's courts' job to construe these laws, the dissent please, and Virginia courts' job to remedy them if needed.
As noted last time, Jaynes is out of any mandatory appeals. This Virginia Supreme Court case was a discretionary review. Any US Supreme Court case would also be discretionary. As other bloggers have noted, this case splits the general Supreme Court trends on First Amendment issues, furthering the Supremes' trend of narrowing standing, but also offering less First Amendment protection to commercial speech than the likely-more-protective current Supreme Court might.
After granting a discretionary re-hearing, the Supreme Court of the State of Virginia reversed its earlier opinion, and Jaynes' coviction, and held the Virginia anti-spam statute unconstitutionally violates the 1st Amendment. Since the statute covers non-commercial as well as commercial speech, the Court ruled it is unconstitutionally broad. In doing so, the court concluded that its initial reading of Hicks was problematically narrow, and Jaynes properly had overbreadth standing.
March 2008 Quick Links, Part I
By Eric Goldman
It's a sign of my busy March/April that I am just now posting these...
Reputation/47 USC 230
* I have a lot to say about the JuicyCampus story (AP, MSNBC, Chronicle of Higher Education). Unfortunately, I ran out of time to write a full blog post on the subject. For now, some quick thoughts about this interesting and complex situation:
- Taken to its logical conclusion, 47 USC 230 naturally enables sites to do absolutely nothing to restrict harmful speech. (I'm not saying that accurately describes JuicyCampus--I don't have enough facts to make that claim). However, that's not an unexpected failure of the statute--it's the natural consequence of the statute's design. Any concerns about the costs of unrestricted speech fora need to compared with the costs of more regulated systems. It's not clear that one result is automatically better than the other, and certainly there are costs implicit in all solutions. Sam Bayard explores this issue more.
- Sites that lack credible information will face marketplace responses regardless of any legal rules. In JuicyCampus' case, the marketplace responses include consumers deeming the site not credible, plus intermediaries (in this case, universities) may simply block access by its core users.
- Any possible legal action by the New Jersey Attorney General over JuicyCampus' facilitation of harmful speech should be unambiguously preempted by 47 USC 230--even after Roommates.com.
- The attempted legal bypass to 47 USC 230--trying to convert a negative covenant from the users in the user agreement into an actionable affirmative marketing representation by JuicyCampus--is analytically corrupt. It's also not the law, and it's been rejected in several 230 cases (Noah v. AOL comes immediately to mind). Rebecca has more to say on this issue.
- If negative behavioral covenants by users in a user agreement are actionable affirmative marketing representations that such behavior isn't occurring, then the Internet is a target-rich ecosystem because I imagine that just about every Internet company is eligible for enforcement actions.
- Isn't it typical of an enforcement action to go after the target's vendors (in this case, JuicyCampus' ad networks) and watch them instantly fold?
- This issue reminds us that a website can't promise its users anonymity if it allows anyone else (such as an ad server) to serve up portions of its page and thereby have the ability to collect the same server log data.
* Ciolli v. Iravani: The AutoAdmit lawsuits spill over into a new battleground. As I said when I first blogged on the case, this is a "very messy situation" that has only gotten messier.
* Nemet v. ConsumerAffairs.com. Another lawsuit against an online consumer review site for publishing allegedly defamatory negative critiques.
* Steinbuch v. Cutler, 2008 WL 596747 (8th Cir. Mar. 6, 2008). Steinbuch's lawsuit against Hyperion, the publisher of the Washingtonienne book, can continue in Arkansas. His other claims must proceed in Washington DC if at all.
* Washington Post: Due to the speed at which gossip moves over the Internet, "compared with the pre-Internet era, politicians are less likely than ever to survive a sex scandal with their careers intact."
* H. Brian Holland, In Defense of Online Intermediary Immunity: Facilitating Communities of Modified Exceptionalism, 56 U. Kan. L. Rev. 369 (2008). Prof. Holland wrote a paper I had been meaning to write! He explains how 47 USC 230 enables online communities to use a variety of self-governance structures, while a different liability regime would give communities fewer choices and thereby inhibit community formation and management.
* A Canadian web network called Geosign received $160M of VC money but the company was rendered worthless overnight when Google changed its policies and cut off traffic. Domainers beware!
* New book worth checking out: WEB SEARCH: MULTIDISCIPLINARY PERSPECTIVES (Amanda Spink & Michael Zimmer, eds.) (Springer 2008). A nice cross-section of essays on search engine issues from multiple disciplines.
* Need some original content to improve your SEO? You can automatically generate it through splogging, or you can pay actual humans a small amount of money to write short articles. If the cost is low enough and the SEO credit for truly original content is high enough, the latter may end up being a better economic deal.
* The FTC has lost a jury trial against Impulse Media on its theory that Impulse Media is liable for the spam sent by its affiliates. This is a pretty important decision because (1) the FTC/DOJ rarely lose at trial, (2) their expansive theories about liability for affiliate behavior may be legally incorrect, and (3) the FTC has strong-armed numerous defendants into settlements based on its theory, and future defendants now be willing to fight back.
* On that topic, Cyberheat won an early round in litigation with the FTC over its affiliate practices but has now settled up with the FTC. The settlement gives some guidance about the FTC's thoughts of how marketers should police affiliates, but the Impulse Media jury loss may undermine the teaching of this settlement.
April 20, 2008
Bay Area Blawgers 3.0, May 20, Berkeley
By Eric Goldman
The High Tech Law Institute at Santa Clara University School of Law is pleased to sponsor Bay Area Blawgers 3.0, the third gathering of legal bloggers in the Bay Area and friends. This time we're thrilled to co-host the event with the Berkeley Center for Law & Technology at the UC Berkeley Law School. As we have done in the past, we'll spend about 1 hour of our time in a structured discussion, with the balance of our time for informal chit-chatting. The details:
When: May 20, 6-8 pm
Who: Everyone is welcome, but this event principally will cater to active legal bloggers. Bloggers and friends who have said they plan to attend include: Tsan Abrahamson, Jerry Bame, Hudson Bair, Robert Barr, Larry Downes, Eli Edwards, Bob Eisenbach, Cathy Gellis, Mark Goldowitz (maybe), Susan Gluss, Eric Goldman, Beth Grimm, Greg Haverkamp, Matt Holohan, Cathy Kirkman, Kimberly Kralowec, Ethan Leib, Cathy Moran, Joe Mullin, Deborah Neville, David Newdorf, Dana Nguyen, Chris Peeples, Aaron Perzanowski, Elizabeth Pianca, Mark Radcliffe, Ash Remwa, Colin Samuels, Jason Schultz, Tim Stanley, Stacy Stern, John Steele, Kevin Underhill, Tom Villeneuve, Fred von Lohmann, J. Craig Williams and Cicely Wilson. (This list will be updated as new blawgers and friends RSVP).
Cost: Admission is free.
CLE: This event qualifies for 1 hour of general CLE credit. Santa Clara University School of Law is a State Bar of California approved MCLE provider.
RSVPs: RSVP to Eric Goldman (firstname.lastname@example.org).
Some background materials:
* Announcements of Bay Area Blawgers 1.0 and 2.0.
* Recap of the first gathering
* Photos from the second gathering at Fenwick & West's San Francisco office. More photos.
* List of possible discussion issues
* Census of Bay Area Blawgers
April 14, 2008
"Trademark Use in Commerce" Revisited
By Eric Goldman
You may recall my repeated discussion about the trademark use in commerce doctrine. A quick recap: the federal trademark infringement statute references the requirement that the defendant make a "use in commerce" of the plaintiff's trademark. This language has triggered a lot of confusion. Some believe that the statutory language is simply a jurisdictional requirement (i.e., Congress can only regulate "interstate commerce"), while others believe that the language requires plaintiffs to show much more--such as the Rescuecom case, where the court kicked out the trademark infringement lawsuit against Google for selling keyword advertising because Google didn't make the requisite use in commerce.
I've previously blogged on some of the academic literature about the "trademark use in commerce" requirement, including articles by Dinwoodie/Janis and Lemley/Dogan, McKenna, Barrett and Widmaier. I've also written on the topic myself--see, e.g., here and here. Collectively, some academics (e.g., Lemley, Dogan, Barrett and I) are fans of the trademark use doctrine as a gatekeeping/boundary-setting doctrine and other academics (e.g., Dinwoodie, Janis, McKenna) are skeptical that it can/should play this role.
With the burgeoning literature, we really needed to gather as a community to discuss the issue in real time. We're very lucky that Mark Janis and Graeme Dinwoodie graciously convened a meeting of 16 trademark professors this weekend in Iowa City, Iowa. Iowa City isn't the easiest place to get to (especially when the FAA is grounding MD-80s and tornadoes are ripping through the Midwest), but the conversation and camaraderie made it worth the travel hassles.
I walked away from the event more convinced than ever that we have no chance of reaching consensus about the validity and meaning of the "trademark use in commerce" doctrine. We spent the weekend talking about statutory interpretations, the benefits of rules v. standards, whether trademark law preempts or codifies common law, how to reduce enforcement costs and errors, how to reduce consumer search costs, the many problems of understanding and measuring consumer perceptions and the "balloon-squeezing" problem of fixing one doctrinal problem only to put pressure on some other doctrine. These discussions pointed in lots of different directions, and there were no magic solutions.
At the end of the discussion, I had the opportunity to make some summary remarks. I made 3 points:
1) I think trademark law needs better boundary-setting and channeling doctrines, especially as we get away from the paradigmatic counterfeiting cases. Without such channeling doctrines, whenever a defendant is sued for some expressive activity that somehow references or invokes a third party trademark, trademark law lacks a limiting principle to kick out the case at the outset. Instead, the defendant must fit within various defenses. Some of the channeling defenses, such as functionality and genericism, work pretty well at redirecting cases out of trademark law and into other doctrines, but others don't, such as descriptive fair use and nominative use--both are limited doctrines, poorly understood and put the persuasive burden on the defendant.
The trademark use in commerce doctrine can serve the requisite channeling function, but it doesn't do it very well. But whether it's the trademark use in commerce doctrine or something else, we need some gatekeeping doctrine to trademark law!
2) As we get further away from counterfeiting, other doctrines--contracts, fraud, the FTC Act (and state law equivalents), various other consumer protection and false advertising doctrines--may do a better job of protecting consumers than trademark law.
For example, we need to retire the example of a consumer ordering Coke and the retailer silently delivering Pepsi instead from trademark law. This example is so distracting because we already know that the retailer can't do this--at minimum, such a delivery is a breach of warranty and perhaps even a fraud. Trademark law does provide producers with a remedy (more on this in a moment), but from a consumer protection standpoint, what does trademark liability add to the analysis? Personally, I don't think it adds much.
[UPDATE: James Grimmelmann offers a spirited defense of the "beverage substitution" example. FWIW, the other conference attendees jumped all over me as well by saying that this passing-off example was hard to distinguish from counterfeiting.]
3) In terms of providing producers with a policing doctrine, they typically have numerous doctrines beyond trademark law. However, I'm still stuck on the doctrinal inconsistency here. As I discuss in my forthcoming Brand Spillovers paper (my most recent slides), there is no concerted effort to impose trademark liability on retailers for auctioning third party trademarks or otherwise profiting from third party trademarks through practices such as couponing, shelf space adjacencies, loss leaders, upsells/cross-sells and geographic proximity to branded stores. But why haven't we had any conferences on the boundaries of retailer liability for these trademark practices? Why aren't retailers sued more under trademark law?
One answer (not the complete explanation, but nevertheless relevant) is that numerous doctrines control retailer behavior, including antitrust law, price controls, consumer protection doctrines and numerous retailer-specific rules. Accordingly, we don't need trademark law to police retailer behavior.
4) Conclusion: re-reading the Dinwoodie/Janis paper, I was struck by the pervasive feeling that we're asking trademark law to do too much when thinking that trademark law should regulate search engine ordering or curb information overload. But we're never going to reach consensus on trademark use in commerce as a gatekeeping doctrine given the statute's poor drafting. As a result, I think it's time for us to seriously consider a major redraft of the Lanham Act. After all, the statute has been on the books for over 60 years, and I don't think the law has aged well. Therefore, I propose that we commence working on the Goldman Act of 2025 (I'm just being realistic about the timing, and I'm happy to yield on branding if that will speed up a redraft) to update it for the modern era.
UPDATE: Mark McKenna has posted his own recap.
April 10, 2008
Trademark Dilution Symposium Videos
By Eric Goldman
It seems like only yesterday that the High Tech Law Institute sponsored the Trademark Dilution Symposium, but a quick look at the calendar reveals that it's been over 6 months. Wow, how time flies!
Even at this late date, I think the videos from the event will be interesting to any trademark geek, and we've finally been able to get them online, albeit not in the most convenient format. You can download the videos from iTunesU, which annoyingly also requires you to download the iTunes client if you don't have it already. Sorry about that. I'm working on a more convenient downloading location, but for now at least they are online, so let's call the glass half-full. [UPDATE: You can watch the videos without needing the iTunes client by following this link.]
The whole day was fascinating, but my personal favorite moment occurred when Prof. McCarthy analogized the dilution doctrine to Bigfoot--because no one has offered incontrovertible evidence of either. A long, long time ago, some other bloggers posted more fulsome recaps from the event:
* Rebecca Tushnet, Comparative Analyses of Dilution; Dilution Regulation, Part 2 (Doctrinal Challenges); Dilution Regulation, Part 1 (A Look Back); Consumer Perceptions, Part 2; Consumer Perceptions, Part 1; McCarthy keynote
* Devan Desai, An Example of a Well-Planned and Run Single Topic Conference
* Joyce Cutler, BNA Patent, Trademark and Copyright Journal, Santa Clara Law School Seminar Focuses on Dilution Act Revisions (BNA subscription required)
We have posted a variety of resources on trademark dilution law on the HTLI website, including the slides used by the speakers. If you're working on trademark dilution issues, check it out.
Finally, the Computer & High Tech Law Journal is publishing an issue filled with excellent papers from the symposium. IP law profs on the AALS list will automatically get a complete copy of the issue in your mailbox in the next few weeks, courtesy of the High Tech Law Institute. Everyone else can find the papers though the journal's website when they are posted.
April 09, 2008
Pro-Zango Amicus Brief in Zango v. Kaspersky
By Eric Goldman
The National Business Coalition on E-Commerce and Privacy has filed an amicus brief supporting Zango in Zango v. Kaspersky, the lawsuit over an anti-spyware vendor's classification of third party software as "spyware." I'm not familiar with this coalition and I couldn't find a website for it. If you have any information about them, please let me know. The brief itself conducts a very run-of-the-mill statutory and legislative history analysis, so it doesn't give much color about the coalition or why it cares about this case.
UPDATE: "Among its members are Experian, Fidelity Investments, the Investment Company Institute, Charles Schwab & Co., Inc., Deere & Company, Inc., JP Morgan Chase, General Motors Corp., Vanguard Group, UPS, CheckFree, Eastman Kodak, Bank of America, and The Assurant." This makes me even more curious why these companies would be interested in the issue.
UPDATE: Wendy Davis at MediaPost reports: "The coalition's members operate Web sites that place cookies on users' computers when they visit the site. The group is concerned that the trial judge's decision would immunize spyware removal companies that market software that deletes their members' cookies." Hmm...are they planning to sue CookiePal or any web browser software vendor that sets a default to reject all cookies?
The case library:
April 08, 2008
11th Circuit Freaks Out About Metatags--North American Medical v. Axiom
By Eric Goldman
North American Medical Corp. v. Axiom Worldwide, Inc., 2008 WL 918411 (11th Cir. April 7, 2008)
Oh man, what a bizarre and frustrating ruling from the 11th Circuit on metatags. The parties compete in the "spinal decompression" device market. Defendant Axiom included the plaintiff NAM's trademarks “Accu-Spina” and “IDD Therapy" in the metatags but did not otherwise use the terms. The district court concluded that this constituted trademark infringement, a determination that the 11th Circuit upholds here.
Unfortunately, it's hard to parse this case because the court is imprecise about which metatags were used. I've looked through the defendant's appellate brief and they don't clarify the technology for the court at all--I'm wondering if any of the attorneys involved in this case know that there are multiple types of metatags. We only have the following three facts to work with:
* Axiom included competitive trademarks in the metatags
* Axiom appeared as the second organic search result in Google for the trademarked terms (following the plaintiff, which was #1 in the search results)
* The trademarked terms appeared in the search results descriptions
The court assumes causality here between the metatag inclusion and the search engine displays. This might be possible if Axiom put its competitor trademarks in the description metatags. Doing so isn't automatically problematic; for example, a description metatag that has comparative statements with competitive products should be permissible. However, description metatags--just like any other marketing copy--could be written in a way designed to deceive consumers. If that's what happened here, then I understand the court's anger (even if I might disagree with its analysis).
But another hypothesis fits these facts. The court does not exhibit any understanding of anchor text or the fact that Google sometimes automatically assembles search result descriptions using third party content (such as DMOZ). So it's entirely possible for these three salient facts to occur (i.e., Axiom's site to show up for searches on the competitive trademarks with the trademarks in the site description) even if Axiom only included the trademarks in the keyword metatags (which we know Google ignores). If the latter hypothesis is true, the 11th Circuit completely misattributed responsibility to Axiom for doing things it didn't do.
Predicated on its poorly articulated and possibly erroneous assumptions about Axiom's role in appearing in the search results, the court has little difficulty slamming down Axiom. On the use in commerce question, the court concludes that, pursuant to the "plain meaning" of the statute, metatags are clearly a use in commerce in connection with goods or services because they support advertising objectives. I don't think the statutory language is the least bit clear, especially if search engines ignore keyword metatags and thus the trademark references have no chance of being perceived.
Along the way, the 11th Circuit distinguishes (and denigrates) the Second Circuit's 1-800 Contacts v. WhenU case on two grounds: (1) this involves metatags, not URLs, and (2) "unlike in 1-800 Contacts, the defendant-Axiom in this case did cause plaintiff's trademark to be displayed to the consumer in the search results' description of defendant's site." The court takes an affirmative swipe at the Second Circuit, saying that the analysis in the 1-800 Contacts case is "questionable" and unpersuasive.
On the consumer confusion question, because the plaintiff's trademarks appeared in the search results, the court assumes that "Consumers viewing these search results would be led to believe that Axiom's products have the same source as the products of the owner of the “IDD Therapy” and “Accu-Spina” trademarks, or at least that Axiom distributed or sold all of the products to which the brief description referred, or that Axiom was otherwise related to NAM....Thus, the factual situation in the instant case is that Axiom's use of the meta tags caused a likelihood of actual consumer confusion as to source."
Fortunately, the court does try to limit the collateral damage of its ruling by narrowing the facts at issue:
This is not a case like Brookfield or Promatek where a defendant's use of the plaintiff's trademark as a meta tag causes in the search result merely a listing of the defendant's website along with other legitimate websites, without any misleading descriptions. This is also not a case where the defendant's website includes an explicit comparative advertisement (e.g., our product uses a technology similar to that of a trademarked product of our competitor, accomplishes similar results, but costs approximately half as much as the competitor's product). Although we express no opinion thereon, such a defendant may have a legitimate reason to use the competitor's trademark as a meta tag and, in any event, when the defendant's website is actually accessed, it will be clear to the consumer that there is no relationship between the defendant and the competitor beyond the competitive relationship.
But despite this disclaimer, there's plenty of sloppy and broad language to keep plaintiffs going for some time.
From my perspective, there are two obvious lessons to learn from this case. First, the text of description metatags needs to be reviewed just like any other ad copy. This may seem obvious, but I suspect that many SEMs do not run their metatag scripts by the lawyers. When I was in practice, I would proactively ask our SEM folks to provide a copy.
Second, if you are going to use keyword metatags, you must ensure that competitive trademarks do not appear in your keyword metatags, period. It's just not worth it. They don't buy you much juice with the search engines anyway, and it will leave you exposed to irrational judicial freakouts about keyword metatags if ever tested in court.
April 04, 2008
Rescuecom v. Google Second Circuit Oral Arguments
By Eric Goldman
Yesterday the Second Circuit heard oral arguments in Rescuecom v. Google, and reports from the oral arguments are trickling out.
James Grimmelmann provides a comprehensive report. Many thanks to James for taking the time to write this up. I know how long it takes to write a blog post like his, so we're all the beneficiaries of his work. He concludes with a provocative prediction (thoroughly caveated in his post):
Prediction: 3-0 for Rescuecom, Leval authoring, in a narrow opinion that emphasizes the 12(b)(6) rule against incorporating matters not apparent from the face of the complaint. A Calabresi concurrence mentions the narrowness of the holding and explains why, in his view, it does not affect the settled understanding that retail shelving arrangements, handing out flyers in front of billboards, and other common offline practices are not trademark infringements. Neither opinion says much about the implication of the holding for other online businesses.
Reading James' report, I'm struck by how much of the time the judges spent spinning out hypotheticals, many of them pretty far-fetched. That's unfortunate because judges in full fantasy mode can hypothesize some really crazy scenarios that have no relationship to reality, and writing opinions in response to these hypotheticals ultimately leads to more confusing opinions.
In response to James' prediction, I do think that the case's 12(b)(6) posture heightens the concern for the judges, so I could why the judges would decide to move the legal question to a summary judgment stage. Personally, I am a fan of resolving these issues on the 12(b)(6) because I believe defendants will win these cases anyway after full litigation, so the 12(b)(6) is just a quick way to reach the right result that would likely obtain later only at much higher transactions costs.
The case library:
* Commercial Referential Trademark Uses (Rescuecom v. Google Amicus Brief Outtakes)
* Rescuecom reply brief
* Law professors' brief by Stacey Dogan and me
* Electronic Frontier Foundation amicus brief by Jason Schultz, Corynne McSherry and Fred von Lohmann
* Public Citizen amicus brief by Paul Levy
* eBay/Yahoo/AOL amicus brief by Celia Goldwag Barenholtz, Janet Cullum and others of Cooley Godward Kronish [now mooted]
* Google's initial brief
* Rescuecom's initial brief
* District Court's opinion
April 03, 2008
Roommates.com Denied 230 Immunity by Ninth Circuit En Banc (With My Comments)
By Eric Goldman
Fair Housing Council of San Fernando Valley v. Roommates.com, LLC, 2008 WL 879293 (9th Cir. April 3, 2008)
The Ninth Circuit has issued its en banc ruling in the Fair Housing Councils v. Roommates.com case upholding the prior ruling of the three judge panel. The opinion concludes that Roommates.com does not qualify for 47 USC 230 immunization for some of its activities and sends the case back to the trial court for further litigation on other substantive questions, such as whether Roommates.com's behavior actually violated the Fair Housing Act.
The en banc panel voted 8-3 to reverse the district court. Judge Kozinski wrote the majority opinion, which was not surprising given that Kozinski had also written the lead opinion in the three-judge panel ruling. Judge McKoewn wrote the concurring/dissenting opinion.
Before I get into the opinion’s substance, I want to note that the new opinion shows that the en banc process worked well here. Although I don't think that Kozinski's opinion is as clear as he thinks it is (for example, in FN 39, he says “there can be little doubt that website operators today know more about how to conform their conduct to the law than they did yesterday”), this opinion is more careful and has less ambiguity than his prior opinion. I still don't agree with Kozinski’s conclusions or arguments, but this opinion was written with a lot more precision and, as a result, probably will have fewer adverse collateral consequences than his prior opinion. Kudos to Judge Kozinski for responding to the feedback he got and to the Ninth Circuit for using the en banc process to improve the clarity of its legal rules.
Substantively, Kozinski says that Roommates.com does not qualify for 230 immunization for (1) the questions it poses to users (such as asking racial preferences), (2) users' profile answers made using pull-down menus (at least to the extent that the site required answers before the user could proceed), and (3) its search system and personalized email system that display profile results (and, by implication, suppressed other results) based on impermissible criteria. However, 230 immunized Roommates.com’s unstructured "Additional Comments" data field, even if impermissible sentiments were expressed in it.
There is lots of interesting language and examples in both the majority and the dissent, and it’s worth the read. I’m focusing this post on a few themes in the majority opinion that I found particularly noteworthy:
47 USC 230 was enacted in 1996 during the height of "cyberspace exceptionalism," the belief that the Internet was unique/special/different and therefore should be regulated differently. 47 USC 230 is a flagship example of such exceptionalism. It creates rules that really differ between the online and offline worlds, such that publishing content online may not create liability where publishing the identical content offline would. The medium matters.
Despite Congress’ obvious intent, the majority opinion bristles with antipathy towards cyberspace exceptionalism. In numerous places, it expresses skepticism that offline rules should not apply verbatim to online behavior--even though that's exactly what 230 does in some cases. Kozinski’s not the first judge to rankle at the policy implications of Congress' cyberspace exceptionalism, but he may have let this hostility override other analytical considerations.
As result, I think the majority opinion reflects an implicit normative judgment that the Fair Housing Act should trump 47 USC 230, which distorts the statutory analysis. (To be clear, the dissent makes this point too, so I'm not the only one who feels this way). I understand why the majority would go this direction; anti-discrimination goals are normatively very important. At the same time, 230 codifies some very important norms too.
Like his last opinion, Kozinski's opinion repeatedly indicates that unstructured searches pose fewer problems for 230 than structured ones. Specifically, the majority opinion repeatedly says that “neutral tools” (a term used 5 times but never defined) fully qualify for 230 protection, even if these search tools are misused for impermissible searches. Thus, the opinion explicitly says that general purpose search engines like Google can qualify for 230 even if someone uses it to engage in searches that violate the Fair Housing Act.
The majority opinion further tries to narrow the offending behavior significantly. It says that pull-down menus aren’t inherently problematic. For example, “A dating website that requires users to enter their sex, race, religion and marital status through drop-down menus, and that provides means for users to search along the same lines, retains its CDA immunity insofar as it does not contribute to any alleged illegality.” [So, if someone entered an age below 18 and the lawsuit was over a subsequent sexual assault or statutory rape, no immunity?] It also says that a site that enables searches via “user-defined [search] criteria” would retain the immunity [not sure what that means]. Even so, the ambiguities in this discussion may unfortunately dissuade some websites from providing structured searches of user-supplied content.
The Role of Passivity
Prior to the passage of 230 in 1996, the conventional Cyberlaw wisdom was that an online entity wasn’t liable for user content only if it acted like a "passive conduit." If the entity actively managed its user-supplied content, it could not avoid liability for that content.
We had thought 230 changed that paradigm and eliminated any differences in legal treatment between passive conduits and active content managers. Unfortunately, this opinion raises questions about that. The majority opinion uses the term "passive" 7 times in its opinion, each time implying that passivity contributes to the immunization.
At the same time, the majority opinion also contains some contrary language suggesting that active involvement still earns 230 protection. The majority specifically gives an example where a website that edits user content doesn't lose the immunity unless the editing changes the content substantively:
A website operator who edits user-created content—such as by correcting spelling, removing obscenity or trimming for length—retains his immunity for any illegality in the user-created content, provided that the edits are unrelated to the illegality.
This sounds like a reasonably active involvement with user content. So what does passivity mean, and why did the opinion consistently refer to it?
What Does this Opinion Mean?
Overall, the majority tried hard to communicate that the rule it articulated here should apply narrowly to a limited number of sites: “The message to website operators is clear: If you don’t encourage illegal content, or design your website to require users to input illegal content, you will be immune.” The opinion also tries to signal that this ruling isn’t a major shift away from 230:
Websites are complicated enterprises, and there will always be close cases where a clever lawyer could argue that something the website operator did encouraged the illegality. Such close cases, we believe, must be resolved in favor of immunity, lest we cut the heart out of section 230 by forcing websites to face death by ten thousand duck-bites, fighting off claims that they promoted or encouraged—or at least tacitly assented to—the illegality of third parties.
These broad pronouncements are helpful, and I hope future judges take them to heart. Unfortunately, it’s virtually impossible to articulate in crystal-clear terms why Roommates.com crossed the line while many other websites with similar user interactions still qualify for 230. As a result, despite the broad pro-230 philosophical statements, I'm fairly confident that lots of duck-biting plaintiffs will try to capitalize on this opinion and they will find some judges who ignore the philosophical statements and instead turn a decision on the opinion’s myriad of ambiguities. Ultimately most courts will reach the right results, but only after significant transaction costs, and even so I think erroneous judgments are inevitable. At least this will create a steady stream of appeals that let Kozinski further amplify his views on 230.
While I expect plaintiffs to be emboldened by the lawsuit and to look at the Ninth Circuit as the new venue of choice (replacing the Seventh Circuit after the Craigslist case didn’t turn out to be plaintiff-favorable), I also wonder if this case will spur plaintiffs as much as the recent Mazur case. That case highlights the risk that websites can be attacked for their marketing statements even if the representations are rendered untrue by third party actions or conduct. So, for example, in theory plaintiffs could attack a site like Roommates.com for any marketing statements that say or imply that using its tools are legal. If these kind of "back-door" attacks on a site aren't covered by 230 (and there may be good reasons why they aren't), then plaintiffs won't have to try to exploit ambiguities in the Roommates.com opinion to get their desired results. If so, while this opinion may not be a great one for defendants, there may be even darker clouds on the horizon.
* Michael Erdman
* Ryan Siegel
* Evan Brown
* Eugene Volokh
* Susan Crawford
* Daithí Mac Síthigh
* Greg Beck and Paul Levy
* Jonathan Frieden
* The Recorder
* Jeff Neuburger
* Sam Bayard
* Derek Bambauer
* Dan Solove
* Cathy Kirkman
UPDATE: Michael Risch writes me:
You said: "Unfortunately, it’s virtually impossible to articulate in crystal-clear terms why Roommates.com crossed the line while many other websites with similar user interactions still qualify for 230."
Here's my attempt at clarity: Roommates.com REQUIRES people to state their race, and thus is a co-developer of what is published on its site. The other sites likely did not have mandatory choices with mandatory publication.
Thought experiment - the comment section on my blog allows for free responses, but at the bottom is a drop-down box, in which every user must make a choice in order to post the comment: "I hate jews", "I hate women". When the comment appears, the user's text, and the text of the selection shows up in the comment. Sure, the user selected the statement, but I'm the one who came up with the idea and forced the user to select on or the other, and then forced the text to display. I have to think that is a development of the content.
Of course, the extension of this is that epinions now gets sued where it requires a 1 star to 5 star rating. That doesn't seem right, but maybe that's on the merits and not on the immunity. You would, I imagine, say it SHOULD be about the immunity, but I'm not so sure.
I think the even less clear question is what if it is NOT mandatory, and merely suggestive.
As for the searching aspect, here is the attempt at clarity: if Roomates.com had a button that said "find white roommates" it would be the speaker of a discriminatory search practice. Allowing a choice of white, black, etc. as a search item is simply an expansion of that.
The case library:
* Recording of the en banc oral argument
* Amicus brief from a variety of Internet companies such as Google, eBay and Amazon plus non-profit organizations such as the EFF [subsequently rejected by the Ninth Circuit]
* Amicus brief from various news organizations
* Amicus brief from the ACLU. Roommates.com's reply brief to the ACLU brief.
* The Fair Housing Councils' request to brief Batzel. Roommates.com's opposition. The Ninth Circuit denied the Councils' request on Nov. 6.
* The Ninth Circuit order granting the en banc hearing
* Fair Housing Councils' reply to the EFF et al amicus brief
* EFF et al amicus brief supporting a rehearing en banc
* Fair Housing Council's response to Roommates.com's request for an en banc rehearing
* Roommates.com's En Banc Request
* The original Ninth Circuit opinion
* My blog post on the Ninth Circuit opinion
So what does a duck bite look like? See here. Quack!
Roommates.com Denied 230 Immunity by Ninth Circuit En Banc
By Eric Goldman
Hot news! The Ninth Circuit en banc panel in the Roommates.com case upheld the 3 judge panel and issued an opinion, not surprisingly written by Judge Kozinski, saying that Roommates.com doesn't qualify for immunity under 47 USC 230. The en banc panel voted 8-3 with a lengthy dissent by Judge McKeown. I'll post an analysis as soon as I can work through it.
UPDATE: My full blog post.
April 02, 2008
School District Didn't Violate First Amendment for Reassigning Teacher Who Blogged--Richerson v. Beckon
By Eric Goldman
Richerson v. Beckon, 2008 WL 833076 (W.D. Wash. March 27, 2008)
A school district appointed Richerson to a position with split responsibilities as a curriculum development specialist and an official mentor for other teachers. She then blogged on her personal blog (I believe this is the blog) about the person who was hired to replace her previous role:
Save us White Boy!
I met with the new me today: the person who will take my summer work and make it a full-time year-round position. I was on the interview committee for this job and this guy was my third choice ... and a reluctant one at that. I truly hope that I have to eat my words about this guy.... But after spending time with this guy today, I think Boss Lady 2.0 made the wrong call in hiring him ... He comes across as a smug know-it-all creep. And that's probably the nicest way I can describe him.... He has a reputation of crapping on secretaries and not being able to finish tasks on his own.... And he's white. And male. I know he can't help that, but I think the District would have done well to recruit someone who has other connections to the community.... Mighty White Boy looks like he's going to crash and burn.
There are a few obvious problems with this post. First, it's just not a nice post. Second, the discussions about the new hire's race and gender could be legally problematic. Finally, and most importantly, Richerson's new duties as a mentor for other teachers expressly required that she develop trusting and confidential relationships with her mentored teachers, and this post raises some questions about her ability to develop those relationships. As a result, once the school district discovered the post, Richerson was reprimanded verbally and in a memo to the file.
Subsequently, the district received a second complaint about Richerson's blog. Another teacher was chief negotiator for the teacher's union, and Richerson blogged "What I wouldn't give to draw a little Hitler mustache on the chief negotiator." I'd have to see the full post to understand the context for this statement. Taken out of context, it appears to be another not-nice statement. It also further undermines confidence that Richerson could develop the kind of rapport with other teachers to provide the mentorship support expected from her job. As a result of this statement, the district reassigned Richerson from her position and moved her back into being a classroom teacher. In response to this reassignment, Richerson sued for civil rights violations (42 USC 1983) because of the alleged curtailment of her First Amendment rights.
The court shows her little sympathy for what it describes as her "salacious mean spirited behavior":
No teacher who was aware of the attack on “White Boy” set forth above could possibly be expected to enter into a trusting, mentoring, confidential relationship with an instructional coach who had revealed the substance of a teaching position interview as did plaintiff....Not only was the blog set forth above a breach of confidentiality, it was racist, sexist, and bordered on vulgar....[The] Hitler” and “mustache” remarks far exceeded normal standards of decency and no relevance to the issue of “public concern” plaintiff suggests she was addressing....Plaintiff's inability to control her rage and/or passion at the least justifies the reassignment of her duties so as not to expose teachers wanting to improve their classroom skills to potential exposure on plaintiff's blog.
Accordingly, the court grants summary judgment for the school district, dismissing her case.
When dealing with employees who blog about their jobs on personal blogs, employers and courts need to carefully balance numerous competing interests, but I think the court reached the right result in this case. Ultimately, given the nature of the job duties Richerson was asked to perform, her blogging choices raised serious doubts about her ability to perform that job properly. I think this is a good cautionary tale for every employee who blogs about his/her work life--even if blog posts don't expressly violate the law, they can still trigger a reassessment of the employee's judgment in ways that damage the employee's job prospects.
April 01, 2008
Recent 47 USC 230 Developments Talk
By Eric Goldman
Today I gave a talk on recent 47 USC 230 developments (following on the popular "47 USC 230 Week" at the Technology & Marketing Law Blog a couple of weeks ago). I didn't even really get into the Craigslist case because the opinion wasn't all that insightful and we really need to see the Ninth Circuit en banc ruling in the Roommates.com case to see where we stand on those issues. Instead, I focused on three hot issues in 47 USC 230 jurisprudence:
* when does 47 USC 230 immunize a website from its own marketing representations?
* how does 230 apply to online retailers for merchandising?
* does 230 preempt state IP laws? [Note: this refers to last week's Friendfinder case, which I'll blog fully later this week]
Check out the slides.