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July 31, 2008
Still Not Copyright: Para-Copyright Revisited--Blueport v. US
Another friendly reminder that not everything related to copyright is copyright.
By Ethan Ackerman
The Copyright Act is a curious critter. Litigants seem to keep finding ways to get unexpectedly drawn into it when they don't want to and ways to fall short of it even when they want its cover.
This blog previously focused on one such near-but-not-copyright situation, Prince's record album's take down notice of a bootleg performance. The post pointed out that the take down notice was likely improper as there was probably no copyright infringement occurring, only the related para-copyright no-bootlegging right.
A Federal Circuit opinion, Blueport v. U.S., has basically affirmed that line of thinking, deeming the DMCA anti-circumvention provisions as a para-copyright. In a suit by a software development company against the Air Force, it held a para-copyright right (in this case, the anti-circumvention provisions of the DMCA) is not part of or the same thing as the Copyright Act, and thus can't take advantage of the government's copyright sovereign immunity waiver.
While news editorials are tempted to dismiss the case as "Maybe Congress just likes free software too," William Patry's ongoing coverage of the case digs a bit deeper. He points out both that the DMCA is outside of and not a part of the Copyright Act, but also the astute policy observation - it's hypocritical to heavily push similar "copyright-plus" provisions abroad while not even complying with them domestically.
[Eric's additional comment: On that point, I remember the 1990s debates over "softlifting," the installation of software on more computers than the license permits. When the SPA (now the SIIA) would go to Congress to lobby against softlifting, they would routinely harp on the fact that the US government was one of the biggest softlifting abusers.]
Posted by Ethan Ackerman at 04:37 PM | Copyright | TrackBack
July 29, 2008
"But United is a major provider of Airline Tickets"
By Eric Goldman
I got the following postcard solicitation in the mail yesterday:
(Click on it to see a larger size).
There are a number of goofy things about this postcard, including the language that I am "now ON RECORD" (hooray for me!) and that I should respond promptly "so we may process you" (I hope that doesn't hurt!).
But the dominant visual image is the color logos of United (unfortunately shown as black and white in this scan), which are repeated in color on the other side of the postcard. In context, I think most readers are led to the unambiguous inference that United Airlines has some connection with this offer. That inference is putatively dispelled by the fine print disclaimer at the bottom, which says "not sponsored by United Airlines. But United is a major provider of Airline Tickets." Well, with that, at least there's one true statement in the postcard.
Posted by Eric at 11:37 AM | Marketing | TrackBack
July 24, 2008
Relevancy Trumps Creepiness, and Some Thoughts About Behavioral Targeting
By Eric Goldman
On Monday I spoke on a panel at OMMA Behavioral. See the MediaPost recaps (1, 2, 3, 4). The crowd was buzzing about Dave Morgan's earlier remarks (which I didn't hear) that behavioral targeting is "creepy," and throughout our panel discussion, any enthusiasm expressed about behavioral targeting was tempered by creepiness concerns.
I can understand this reaction, as least a little. When I was younger and first learned about the many tricks of marketer targeting, I was initially aghast by the seeming intrusion. They can't do that, I thought.
As regular readers know, I've outgrown those sentiments. Now, I really don't care what the machines know about me. And if the machines can figure out how to better cater to my interests and reduce the spam in my life, then I'm all for it.
At the same time, I think this latter observation suggests my real problem with behavioral targeting. There will always be some privacy diehards who will object to machine monitoring of their behavior on principle, but most people will be receptive (even after they get through the initial shock about behavioral tracking) if the targeting improves the user or consumer experience. Demonstrate to consumers that behavioral targeting gives them better results, and it's an easy sale. Relevancy trumps creepiness.
But I haven't seen any evidence that behavioral targeting has produced these payoffs (or, for that matter, any meaningful payoffs) for consumers yet. Current behavioral targeting practices might give marketers a little conversion lift compared to other targeting solutions (or not), but they have done little to change the overall fact that ads remain poorly targeted and crummy, and consumers still have plenty of incentives to treat ads as the pain to avoid through ad blindness or technology.
At this point, I'm still wondering if and when behavioral targeting will deliver on its theoretical promise. Sure, we can find excuses for the crummy user experiences today--the technology is still being developed, it's hard to get useful datasets (more on that in a moment)--but those excuses only go so far, and they will wear thin quickly. For behavioral targeting to really be a game-changer, it needs to deliver dramatically improved ad relevancy for consumers, and we're far from that ideal point.
I've argued before that for behavioral targeting to work, the marketer needs a comprehensive dataset about the consumer. Accordingly, a marketer--even an ad network--that relies solely on data collected from a consumer's interaction with web servers simply can't see enough data about the consumer to achieve a sufficient level of relevancy for the consumer. My paradigmatic example: no matter how much Amazon knows about my purchases from it and my browsing habits on its site, they still don't know if I bought a book from someone else unless I tell them (and I have no reason to tell Amazon what books I buy elsewhere).
This is why I'm so intrigued by the Internet access provider-level targeting exemplified by Phorm and NebuAd. In theory, they get access to much better datasets than web server-level targeters. If I browsed for a book on Amazon but I bought the book at barnesandnoble.com, the Internet access provider can know this while neither Amazon or B&N will know about my interactions with the other vendor.
For this reason, I've been quietly bemused by the legal fracas over Phorm and NebuAd's practices. Don't get me wrong--although the analysis is intensely fact-specific and I don't have all the facts, I have serious concerns about the legality of their practices. But from my perspective, the battles over the legality of Phorm and NebuAd are a smokescreen for the real issue, which is that marketers who have only server-level data don't want to compete against someone who has a better dataset than them. So expect plenty of continued fireworks over Phorm and NebuAd, but don't kid yourself that it's only the privacy advocates beating up on them.
Posted by Eric at 02:05 PM | Marketing , Privacy/Security | TrackBack
July 21, 2008
Teaching Cyberlaw Article
By Eric Goldman
As part of the recent St. Louis University Law Journal's issue on Teaching Intellectual Property Law, I published a short article entitled "Teaching Cyberlaw." The abstract:
"Over the past dozen years, Cyberlaw courses have become a staple of the law school curriculum. This Essay, part of a Spring 2008 St. Louis University Law Journal issue on Teaching Intellectual Property Law, explores methodological and pedagogical issues raised by these courses."
This article, based on my experiences teaching Cyberlaw for the past 13 years, organizes my thoughts about the pedagogy of teaching Cyberlaw, including course titling, doctrinal coverage, teaching materials and more. I think the article will be particularly interesting to folks teaching the course for the first time, but I expect veteran Cyberlaw professors will find a few interesting tidbits as well. I was given a limited word count cap, so I didn't intend to make this article exhaustive. Instead, I view it as a tentative and limited effort to help kick off a community discussion about how we teach the course.
On that front, I am scheduled to be the Chair of the AALS Law & Computers Section in 2009, which principally means that I will help organize the Law & Computers session at the AALS Annual Meeting in New Orleans in January 2010. (Hard to believe, but it's less than 18 months away!). One idea I've been considering is to have a panel discussion about Teaching Cyberlaw issues at that session. Comments/thoughts?
When i did my research for my Teaching Cyberlaw article, I didn't find any other law review-style articles that addressed Cyberlaw pedagogy at any length. Then, just as my article was going to press (and therefore after I could make any changes), a topical article emerged: Patrick Quirk, Curriculum Themes: Teaching Global Cyberlaw, International Journal of Law and Information Technology, March 2008. Quirk uses the article to enumerate 10 topical "themes" that are likely to be omnipresent in Cyberlaw courses both today and in the future:
"Where are we? (Jurisdiction),
Who are we? (Transacting via networks),
Who pays us? (E-money and funds transfer),
Who protects us? (Spreading and transferring transactional risk),
Who funds us? (The other type of computer ‘security’),
Who taxes us? (Who doesn’t?),
Who bugs me? (Network crimes and misdemeanors),
Who came before me? (Historical analogies for technology regulation),
Who watches (over) us? (Ubiquitous privacy issues),
The pervasive problems of intellectual property."
I definitely organize my course differently, but vetting different organizational approaches is part of the pedagogical fun.
Posted by Eric at 08:37 AM | General , Internet History | TrackBack
July 19, 2008
American Airlines and Google Settle Keyword Advertising Lawsuit
By Eric Goldman
American Airlines and Google have settled American Airlines' trademark lawsuit over Google's sale of keyword advertising. The settlement terms are confidential. See the unenlightening stipulation and the judge's dismissal order. The Justia page. The Bloomberg News story.
Because the terms are confidential, we don't know who "won" this lawsuit (other than the lawyers, of course). I did a search this morning for "American Airlines" and American Airlines had the only keyword ad. No third party ads showed, which as I recall is different than past results, but it's possible that American Airlines has run third party advertisers off the term one-by-one rather than getting Google to block the term for them. I also did a search this morning for "aa.com" and got one third party ad for lowfares.com. A search for "AADVANTAGE" showed two third party ads, one for an AAdvantage credit card (probably authorized) and the other for firstclassflyer.com (probably not).
Based on this data, my initial hypothesis is that Google did not make any special concessions to American Airlines to block keyword ads on their trademarks. Perhaps Google made other concessions. Or perhaps American Airlines completely wasted its time and money. If so, it wouldn't be the first time that a company with the word "American" in its trademark took on Google and got nothing.
This settlement is presumably a disappointment to trademark diehards who were cheered by a well-financed and well-recognized trademark owner taking on the mighty Google. Now, this case isn't going to break any new ground in the Fifth Circuit. Combined with Utah's repeal of the Utah Trademark Protection Act, the only major threat to Google's keyword ad practices in the United State still pending is the Rescuecom appeal in the Second Circuit, which I must confess I remain nervous about.
Posted by Eric at 09:05 AM | Derivative Liability , Trademark | TrackBack
July 18, 2008
Print-on-Demand "Publisher" Isn't Liable for Book Contents--Sandler v. Calcagni
By Eric Goldman
Sandler v. Calcagni, 2008 WL 2761892 (D. Me. July 16, 2008). The Justia page.
I've previously blogged about the probable inapplicability of 47 USC 230 to CafePress and its competitors because of their offline publication onto physical media. This case, which doesn't reference 230 at all, gives hope to these "print-on-demand" vendors that they will nevertheless get some insulation from user-created problems even without statutory immunization.
The facts of the underlying dispute (which are a little cryptic because the opinion is partially redacted) sound like the makings of a Hollywood movie. Stop me if you've seen this one before. In this case, two high school cheerleaders in Maine start out as friends but have a falling-out in October 2003 that takes a very nasty turn. By November, both girls are suspended from school, and each of them complains of harassment by the other to the school, the police and elsewhere. (As Rodney King said, can't we all just get along?) Then, in November 2003, someone spraypaints swastikas in between Ms. Sandler's house and the high school in an apparent anti-semitic attack on Ms. Sandler. Although she denies doing the spraypainting, Ms. Calcagni was convicted of criminal mischief and entered a consent degree with the AG's office in a civil hate crime prosecution.
Believing that Ms. Calcagni was wronged, her parents launched a media campaign to set the record straight. The campaign included a book detailing their side of the story, which they shopped around to publishers. Finding no takers among traditional publishers, they decide to self-publish the book through BookSurge, a typical print-on-demand site. See more about the book here, including a review that describes the book as "sloppy journalism." They order 760 copies from BookSurge, which they give away and try to sell in local bookstores in Maine. Another 80 copies are sold online through Amazon and BookSurge.
From my outsider's perspective, it seems obvious that the Sandler and Calcagni families are locked in a cataclysmic downward spiral that will make some lawyers rich and will leave a lot of other people very unhappy for many years. It's already been 5 years since the fateful turn of events, and the parties don't appear to be close to being done with each other. The latest iteration in the multi-front war is Sandler's lawsuit against numerous people involved with the book publication, claiming defamation, privacy invasion and related torts. I suspect that this lawsuit between Sandler and Calcagni will fester in the courts for years, but I'm only interested in the court's ruling yesterday on BookSurge's request to exit the lawsuit early.
If BookSurge was a traditional publisher, providing editorial and marketing services, BookSurge should face defamation liability as a primary publisher. However, BookSurge was a printing house that took an uploaded PDF and converted it into a physical book. In this sense, BookSurge might be analogized to a copyshop that reproduces accurate copies of customers' materials. BookSurge adds a little more value than a pure robotic copier; for example, it helps match self-publishers with book retailers like Amazon.com (and it wouldn't surprise me if BookSurge gets some money for making that match). Nevertheless, I think it's fair to say that, overall, BookSurge is passive in the printing process.
Due to BookSurge's passivity, BookSurge lacks the requisite degree of scienter to hold it as a "publisher" for purposes of defamation or the privacy invasions. As the court says:
Because BookSurge does not undertake to edit, review or fact-check any of its publications, it has no means or way of knowing whether defamatory material is contained within the works that it publishes. BookSurge maintained no editorial control over the works published. The responsibilities of BookSurge, which are known to the authors of the works, indicate that it is not an active participant in the creation of any defamation.
Some of Sandler's claims of public disclosure of private facts also failed because she herself disclosed the same facts on her MySpace page. As a result, BookSurge is dismissed from the lawsuit.
I think this ruling bodes well for sites like CafePress to the extent they can't claim 47 USC 230. In many cases, they effectively act as a "contract printer" for users by taking user-submitted content and printing it. Admittedly, the printing media might be non-traditional (t-shirts, coffee mugs, etc.) but I think the reasoning should apply the same. However, it remains less clear if CafePress' other involvement in the sales--taking payment, shipping the items directly to buyers--will make the analysis more cloudy. Further, this case doesn't do much to help insulate CafePress and its ilk when the underlying claim is strict liability, such as copyright infringement.
UPDATE: For another example of women who just can't seem to get along, see Devereaux v. Rodriguez, 2008 WL 2756476 (Cal. App. Ct. July 16, 2008)
UPDATE 2: A blog post on a 2006 case that reached a contrary conclusion.
Posted by Eric at 10:54 AM | Derivative Liability | TrackBack
July 17, 2008
GoDaddy Gets 230 Defense for Web Hosting--Kruska v. Perverted Justice Foundation
By Eric Goldman
Kruska v. Perverted Justice Foundation Inc., 2008 WL 2705377 (D. Ariz. July 9, 2008). The CMLP page with lots of source material.
GoDaddy allegedly hosted some third party websites that said some not-nice things about Kruska (calling her a convicted child abuser, a convicted child molester and a pedophile). Kruska brought a pro se lawsuit against (among other defendants) GoDaddy for hosting the websites. This is squarely in 47 USC 230's sweet spot, and the court notes that "this immunity has proved nearly limitless." Claims dismissed.
More unusual is the court's decision to dismiss a 43(a) Lanham Act claim per 230. The opinion isn't very clear in its discussion (and maybe I missed them in my quick review, but I don't see a 43(a) claim in the two complaints posted on the CMLP page), but I infer her claim is that GoDaddy puts its logo on pages hosted by it and therefore is confusing consumers about the source of the page. The court might have simply dismissed Kruska's claim for lack of standing, but instead refers to 230 in dismissing this claim. I don't believe Kruska was claiming trademarks in her own name (not that it would have improved her odds), but a federal trademark infringement claim is clearly not preempted by 230. Otherwise, I think it's an open question about whether the false advertising parts of 43(a) are preempted by 230. See my slides recapping some of the developments through April. See also Rebecca's blog post trying to sort through the 43(a)/230 interplay in a different case.
As I've now said repeatedly, the interaction between 230 and a website's marketing activities is increasingly unclear and maybe reaching a point of incoherence, and this case certainly doesn't reduce our befuddlement.
Posted by Eric at 02:42 PM | Derivative Liability , Trademark | TrackBack
July 16, 2008
eBay Denied 230(c)(2) Defense Over Counterfeit Coin Policing
By Eric Goldman
National Numismatic Certification, LLC. v. eBay, Inc., 2008 WL 2704404 (M.D. Fla. July 8, 2008)
This is the fourth time in a week that I'm blogging about an eBay lawsuit (see the Windsor Auctions, Tiffany and StubHub postings). There must be something in the water.
I'm a little confused by the facts in this case (the opinion isn't a model of clarity), but let me see if I can boil it down. In 2007, eBay decided to clean up its coins category by adopting a policy that sellers could designate their coins as "certified" only if they used one of four approved rating services. (Sellers can still advertise a designation under other rating services under some conditions but can't use the word "certified"). If a seller violates this rule, then eBay will take down its listing and send an email with the subject line "eBay Listing Removed: Counterfeit Currency and Stamps." Needless to say, some of the rival coin rating services are miffed because eBay sellers now won't want to use their services; and the rival services think that sellers will infer from the subject line that using these alternative services mean that their coins are counterfeit, which also isn't good for repeat business. This prompted the rival services to sue eBay and others for trade libel (and conspiracy thereof) and unfair/deceptive trade practices.
The court dismisses the case with leave to amend, but it refuses to dismiss eBay based on 47 USC 230(c)(2), the comparatively lightly litigated immunization for filtering decisions (most cases interpret 230(c)(1)). Putatively the statute could apply here because eBay adopted its certified coin policy and endorsed specific rating services to hinder the sale of counterfeit coins, so eBay's policy filters out seller-supplied advertising of unwanted products. However, the court rejects eBay's 230(c)(2) defense for two reasons:
1) The statute requires eBay to make "good faith" decisions. eBay says it acted in good faith, but the plaintiffs allege otherwise. The court says this can't be resolved on a motion to dismiss.
2) The statute enumerates a list of appropriate bases for filtering, including a determination that the filtered content is "otherwise objectionable." eBay says ads for counterfeited coins are objectionable. The court, applying the statutory interpretation principle of "ejusdem generis," says that the term "objectionable" has to be read in the context of the previous adjectives in the list, which relate to porn and "bad" content. As a result, eBay's efforts to stretch the word "objectionable" to cover counterfeit coin ads goes too far.
I think the court got it wrong on both fronts. Most frustratingly, the court didn't cite to the directly relevant precedent that it should have had little trouble finding. In a footnote, it says the only 230 case it found interpreting "objectionable" was the Langdon case, which was also a defense win on a motion to dismiss, but that case didn't sway this judge because the holding fit well with the statutorily enumerated basis of filtering for "harassing" content. Unfortunately, though, the court overlooked two other directly relevant 230(c)(2) opinions:
* the Zango v. Kaspersky lawsuit, where the court reached opposite conclusions on both the "good faith" and "objectionable" standards and granted a motion to dismiss. The Zango case is on appeal to the Ninth Circuit, and Zango made a big point in its briefs about ejusdem generis. I assume their lawyers will submit this case to the Ninth Circuit for its supplemental consideration.
* the e360Insight v. Comcast case, which agreed with the Zango case that any good faith requirement in the statute was subjective, not objective, and also granted the motion to dismiss on that basis.
Based on these two cases, the court could have (and IMO should have) required the plaintiffs to allege that eBay had no subjective basis to believe that the targeted listings were objectionable, which plaintiffs typically can't do (at least, not in compliance with Rule 11) without discovery. So this should have been an easy dismissal for eBay.
While I think the court muffed it, I would also note that eBay's decision to implicitly call a mischaracterized coin auction as violative of its "counterfeit" policy is a little confusing to me. There was probably a better way to word its communication to sellers. As a result, I think this ruling dovetails nicely with the Mazur case, where a different court also found that 230 didn't protect eBay for the words it selected to describe third party behavior. Once again, this case reminds us that a website may own the words it chooses even if they characterize or describe third party behavior.
Posted by Eric at 04:31 PM | Derivative Liability , E-Commerce | TrackBack
July 15, 2008
StubHub Denied 230 in Hannah Montana Ticket Scalping Case--Hill v. StubHub
By Eric Goldman
Hill v. StubHub, 07 CVS 11310 (N.C. Superior Ct. July 14, 2008) [note: I believe this is in NC's special "business court"]
I don't even have a tweener daughter (yet), but as a legal scholar, I am beginning to hate Hannah Montana due to the bogus legal developments that her concert tour is leaving in its wake. Ex A: the abysmal Ticketmaster v. RMG case, where the court bastardized Cyberlaw at least a half-dozen times to smack the ticket sniper. Ex B: the spate of silly state laws restricting the gaming of online ticket sellers' algorithms, such as the Minnesota law.
Ex C is today's case, Hill v. StubHub. Mrs. Hill bought 4 tickets to a Hannah Montana concert through StubHub at grossly inflated prices. Plaintiffs allege that they can't tell if the tickets were sold by a StubHub user or by StubHub for its own account, but they allege that StubHub is the seller for purposes of designating StubHub as the ICP in the 230 analysis. Plaintiffs thus claim that StubHub violated the criminal NC anti-scalping law and that this violation supports a variety of civil causes of action. StubHub moved to dismiss per 230, implicitly on the basis that a user, and not StubHub, sold the tickets and set the price (although the opinion is too inscrutable to be sure about this). Because there is a factual dispute about who provided the allegedly illegally priced tickets, the court denies the 230 motion and allows the matter to be investigated through discovery.
While denying StubHub's motion to dismiss may or may not be the right result, it's a rare outcome for any plaintiff to defeat a 230 dismissal motion--which is often a good thing to prevent unnecessary and wasteful discovery in cases where the plaintiff has no chance anyway. After discovery in this case, let's see if the judge got to the right result here.
HT: Mack Sperling, who is a colleague of plaintiff's counsel and posts some source material in the case.
Posted by Eric at 10:14 AM | Derivative Liability | TrackBack
July 14, 2008
Tiffany v. eBay District Court Opinion Analysis
By Eric Goldman
Tiffany (NJ) Inc. v. eBay Inc., No 04 Civ. 4607 (RJS) (S.D.N.Y. July 14, 2008)
It took most of the day, but I've finally read through the 66 page book in the Tiffany v. eBay case, and this post supplements my brief announcement post with a more thorough critique. Overall, the opinion is very thoughtful. If you have the time, it's worth reading in its entirety. If you deal with websites that are potentially liable for user-caused trademark infringements, you should definitely read the case to get a roadmap of eBay’s multitudinous infringement suppression practices that the court endorses. But if you don't have the time to read the whole case, this post focuses on some of the best parts.
eBay's Counterfeit Suppression Efforts Endorsed
Most noteworthy is that the judge endorsed eBay's various efforts to reduce the sale of counterfeit goods on its site and provide extrajudicial recourse to brand owners like Tiffany. Back in the 1990s, some caselaw suggested that affirmative efforts to suppress user activity might exacerbate liability, so the preferred strategy was to remain "passive" with respect to users. eBay chose a different approach. It proactively attempted to reduce the incidence of counterfeiting on the site through its VeRO program, its fraud engine, manual review efforts to seek out auctions that looked like they might be counterfeit goods. Further, eBay continues to innovate new ways to curb bad users or help brand owners.
A ruling like this validates eBay's investments. The judge fully acknowledged and appreciated that eBay didn't just stand on the sidelines and let Tiffany take it up with its users. Kudos to eBay's management and in-house legal department for navigating the liability issues in a way that clearly impressed the judge.
One small cautionary note. The judge rejected eBay's argument that it was just an online advertising venue. Instead, because of the many value-added services that eBay provides to its sellers, the judge thought that the offline swap meet analogy was more apt. The determination was inconsequential in this case, although I'm sure eBay wishes the reference wasn't there. However, it's a good reminder that this "we're just a venue" argument can be a tough sell to judges. Google, if you're listening, this doesn't bode well for your argument that you just sell ad "space" instead of selling trademarked keywords.
Tiffany's Arguments Rejected
This ruling is a stinging rejection of some of Tiffany's core arguments. First, the court found that Tiffany didn't invest enough in its policing efforts, referring to Tiffany’s investment as "relatively modest." I've argued before that this case is really just a Coasean battle over transaction cost allocation (i.e., once the judge sets the entitlements, the parties can negotiate from there), and Tiffany's arguments to persuade the judge that eBay should bear more costs clearly failed (meaning that eBay gets the legal entitlement). Indeed, the court goes so far to say "even if it were true that eBay is best situated to staunch the tide of trademark infringement to which Tiffany and countless other rights owners are subjected, that is not the law."
Second, it was really interesting to see the court's treatment of Tiffany's demand to eBay that eBay should filter out any auctions containing 5 or more Tiffany items of the same type because such an auction is an obvious red flag of suspect users. Tiffany's approach is very common among IP owners--they manufacture an artificial rule and then demand fidelity to the rule at peril of litigation. (As another recent example of this phenomenon, recall the dustup over the AP's unilateral declaration of the permissible amount of quoting of AP articles. Where did that rule come from?). Many times websites kowtow to these demands to avoid litigation, but here the court shreds Tiffany for creating a baseless rule and then treating eBay as the villain for "breaching" the rule--especially because Tiffany kept on changing the rules and softened its adamancy. Tip to IP owners--if you are going to manufacture a rule about how people can engage with your IP from whole cloth, don't be surprised if judges won’t rubberstamp it. If anything, they may think you're overreaching.
Notice-and-Takedown Scheme for User-Caused Trademark Infringements
Historically, the standards for contributory trademark infringement due to user activity have been underdeveloped. Copyright is covered by the DMCA (512) and non-IP claims are covered by the CDA 47 USC 230, but trademark law lacks an analogous statute. Further, there have been very few cases on the topic, and possibly applicable statutory provisions, such as the 1114 printer/publisher partial defense, are also underlitigated in the online context. Due to the dearth of statutory and caselaw material, Cyberlaw specialists have not had a good sense of the rules applicable to secondary trademark infringement online.
This case fills an important gap in our precedent. In the context of this case, it squarely anchors website liability for user-caused trademark infringements in a notice-and-takedown regime not dissimilar to the RTC v. Netcom copyright ruling from 1995 (which provided the basis for the DMCA notice-and-takedown system). Because it's not statutory, this court doesn't prescribe the specific contours of a sufficient takedown notice. At the same time, it rejects any generalized knowledge of future infringements as being sufficient--and most specifically, it declares as insufficient a trademark owner's C&D letter demanding that the website prospectively police its premises to prospectively prevent any future infringements. (Cite to, and endorsement, of the Ninth Circuit's 1999 Lockheed v. NSI case). It also says that failing to prospectively look for infringement does not equal willfully turning a blind eye.
While this is good news, I remain uncertain how generalizable this ruling is. So much of the court's discussion is deeply linked to eBay's specific situation--both the fact that it allows users to sell legitimate Tiffany goods, as well as the many efforts that eBay made to prospectively accommodate the interests of IP owners, which eBay can afford to do but many other websites can't. Personally, I think a notice-and-takedown scheme is the most probable solution to a website's liability for user-caused trademark infringements, and I hope this ruling moves us more clearly in that direction. However, we'll have to see how much future courts limits this case's holdings to eBay's unique attributes.
An interesting side note: the judge blessed eBay's tiered efforts to punish users whose listings were the subject of a NOCI. In some cases, eBay had a one-strike rule; but in other cases, especially when dealing with a known and trusted user who might be trying to earn a livelihood through the site, eBay had a three-strikes rule. The court endorses this practice, and specifically says that it was OK for eBay not to adopt a universal one-strike rule.
The Nominative Use Defense
With respect to Tiffany's trademark infringement claim, the court largely skipped over the use in commerce and likelihood of consumer confusion discussion and instead focused on the nominative use defense. Per the nominative use defense, eBay is free to tell the world that legitimate Tiffany goods are available through eBay. From my perspective, eBay made a quintessential "commercial referential trademark use" that I have elsewhere argued is outside the scope of trademark law. The court doesn't use that term; in fact, it sloppily uses the term "descriptive use" which superficially made it look like it was confusing this doctrine with the statutory descriptive fair use. Nevertheless, it fully and clearly gets the point that Tiffany was trying to suppress legitimate competitive after-market sales by circumscribing the use of the term "Tiffany," and the court adopts the nominative use defense to give eBay the necessary breathing room.
While the court is right about this, the court does not acknowledge the limitations of the nominative use defense. Just last month, a online retailer reselling legitimate goods lost the nominative use defense because of an implied endorsement. See the uncited Standard Process v. Total Health Discount. I think this court got it right and the Standard Process case got it wrong, but I wonder which path future courts will follow.
eBay's Keyword Advertising Blessed
eBay has received some notoriety for its Google AdSense spam, where it automatically manufactures lots of AdSense ad copy using all kinds of nouns, including third party trademarks, and buys the noun/trademark as the triggering keyword. eBay did this with the Tiffany trademark. Because this court is in the Second Circuit, this judge joins the prevailing caselaw that buying "Tiffany" as the keyword trigger for ads doesn't constitute a trademark use in commerce. However, before eBay disabled the Tiffany term, eBay's spam ads also displayed the term "Tiffany" in the ad copy, and the court (following the directly-on-point Hamzik opinion) says that the ad copy display of the trademark constitute a trademark use in commerce. Nevertheless, because eBay actually sells legitimate Tiffany goods, the ad copy display qualifies as a nominative use. This conclusion directly conflicts with the Standard Process v. Total Health Discount case.
eBay Didn't Engage in False Advertising
Tiffany argued that eBay falsely advertised by implying that it offered legitimate Tiffany goods when, in fact, many goods were infringing. The court rejects this argument, although I fear the court may have cut some corners here. First, the court says that eBay is protected by the nominative use defense. I'd have to do some research, but I can’t recall another case where nominative use was a defense to false advertising. Also the court says that if eBay's advertising is false, it's the users' fault, not eBay's. While I agree with this sentiment, Judge Patel partially rejected this argument in the uncited Mazur v. eBay case.
No Dilution
The court says that a junior user cannot commit blurring when it's making a referential use to the trademark owner. Further, eBay can't be tarnishing the trademark by helping sell counterfeit goods when it takes down all counterfeit auctions it knows of.
The Future
I've read a number of press reports today indicating that Tiffany is likely to appeal to the Second Circuit. Given the amount of time and money they have already invested in this litigation, that's a logical decision. However, I thought this opinion was almost uniformly thoughtful, thorough, well-written and well-researched, with usually multiple alternative bases for its conclusions. It looks like the judge intentionally wrote it to be as appeal-proof as possible. Clearly Tiffany will have an uphill battle on appeal.
If Tiffany loses on appeal, I wouldn't be a bit surprised if the battle moves to Congress. I suspect the various pro-IP bar associations will be itching to mobilize the troops over this ruling.
Other Perspectives
* Michael Kwun at the EFF
* Wendy Seltzer
* Jason Schultz
(Wendy and Jason are ex-EFFers. Looks like a lot of EFF folks are interested in this case!)
Posted by Eric at 06:55 PM | Derivative Liability , Trademark | TrackBack
eBay Wins Huge Ruling in Tiffany Case
By Eric Goldman
Tiffany (NJ) Inc. v. eBay Inc., No 04 Civ. 4607 (RJS) (SDNY July 14, 2008)
In a 66 page ruling that I haven't had time to digest, the judge appears to have completely accepted eBay's arguments in the Tiffany v. eBay lawsuit over sales of counterfeit Tiffany goods on eBay, issuing a clean sweep for eBay and dismissing the case in its entirety. The most interesting parts from the introduction:
* "the Court finds that eBay’s use of Tiffany’s trademarks in its advertising, on its homepage, and in sponsored links purchased through Yahoo! and Google, is a protected, nominative fair use of the marks."
* on the contributory liability question, the court reiterates that the standard is "whether eBay continued to supply its services to sellers when it knew or had reason to know of infringement by those sellers." eBay's response to take down notices satisfied this standard. "The law does not impose liability for contributory trademark infringement on eBay for its refusal to take such preemptive steps in light of eBay’s “reasonable anticipation” or generalized knowledge that counterfeit goods might be sold on its website. Quite simply, the law demands more specific knowledge as to which items are infringing and which seller is listing those items before requiring eBay to take action." The court brushed aside Tiffany's complaints about the policing costs it had to bear.
* The court rejects dilution because Tiffany hasn't shown a likelihood of dilution; and even if it did, eBay's use would be protected as a nominative use.
I need to read this ruling with more care, especially the judge's interesting reliance on the shaky nominative use doctrine. I'll try to update this post after I do. For now, this is a major win for eBay specifically, but it's also a win generally for online service providers who have been receiving trademark takedown notices and haven't known what to do about them. Unfortunately, a nice clean win like this also invites a challenge, and I'd be surprised if this ruling were the end of it. Instead, the battleground might just shift to the Second Circuit or Congress.
UPDATE: I have posted a comprehensive critique of the case here.
Posted by Eric at 10:11 AM | Derivative Liability , Trademark | TrackBack
State of the Net West 2008, August 6, SCU
By Eric Goldman
I would like to invite you to attend State of the Net West 2008, co-sponsored by the Advisory Committee to the Congressional Internet Caucus and the High Tech Law Institute. This event is a complement to the very popular State of the Net event in DC held each January, which has become the "must attend" event for technology policy wonks and lobbyists. See my recap of this year's event. On August 6 at Santa Clara University, we'll have a West Coast version of the DC event, with three members of Congress guiding our discussion on cutting-edge policy issues related to Internet content protections. As usual, registration is free, so submit your RSVP here. I look forward to seeing you there!
__________
The full description:
In August The Congressional Internet Caucus Advisory Committee in collaboration with the High Tech Law Institute at Santa Clara School of Law cordially invites you to attend the 2nd Annual State of the Net West Conference on Wednesday, August 6th, 2008, in the California Room at the Benson Center of the Santa Clara University School of Law, from 8:30 a.m. to 2:30 p.m. The discussion will feature leaders of the Congressional Internet Caucus, including Congresswoman Zoe Lofgren, Congressman Mike Honda, and Congressman Bob Goodlatte. Other participants will include West Coast academic scholars, public interest advocates, and industry executives during a series of discussions on current, important technology policy issues. State of the Net West is designed to channel West Coast thought leadership from the academic community and private sector to help inform the technology policy issues being debated in Washington.
The State of the Net West Conference allows for bicoastal networking and dialogue on key policy issues to take place in the heart of Silicon Valley. Participate in lively debates exploring the following topics:
"Will Our Reputations and Privacy Survive the Age of Social Networking?"
"Can ISP Immunity Survive the Onslaught of Web 2.0"
"The Movement of Information from the Crowd to the Cloud"
The Congressional Internet Caucus Advisory Committee hosts the annual "State of the Net Conference" in Washington to frame many of the technology policy debates that Congress grapples with throughout the year. State of the Net has grown into the largest and most influential information technology policy conference in the country to discuss technology trends and the enormous challenges that lawmakers, industry leaders, and citizens must confront and resolve. While the State of the Net Conference has been an unmitigated success at framing the debate in Washington, an infusion of intellectual capital from the West Coast significantly enhances the State of the Net discussions.
Posted by Eric at 03:24 AM | General | TrackBack
July 11, 2008
The Sex Tape Problem...and a Possible Legislative Solution?
By Eric Goldman
An inescapable fact of the digital era is that people will be depicted in digitized sex videos ("sex tapes") that they wish did not exist. Sex tapes can be classified into a variety of types:
* sex tapes of non-consensual sex. The taping may exacerbate the harm to the victim, but the non-consensual sex is already criminal--and the sex tape could provide valuable evidence to the prosecution to help convict the criminal. The consent issue gets trickier when dealing with underage participants who are legally incapable of consenting to sex, such as two underage teens who might jointly decide to tape their sexual encounter.
* sex tapes of consensual sex where one of the parties didn't consent to the taping.
* sex tapes where both the sex and the taping were fully consensual, but one of the parties exceeds the scope of consent about subsequent use or disclosure. Ex 1: sex partner keeps and watches sex tape after breakup in contravention of other party's wishes. Ex 2: sex partner distributes the tape to third parties who the other party didn't contemplate would see the video. In the most egregious case, the sex partner publicly distributes the tape via the Internet when the other party intended the video to remain private.
* sex tapes where the sex, taping, and further use or distribution are fully consensual among all depicted parties. I believe this describes some of the publicity hounds that deliberately leak sex tapes as a type of marketing for the depicted individual(s) (unfortunately, another seemingly inescapable fact of our lives), even if the depicted individual lightly protests about the distribution to increase the scandal factor. These don't raise a lot of interesting legal issues.
Public distributions of sex tapes are surprisingly common. Check out the long list of celebrity sex tapes at Wikipedia. A Westlaw search for the term "sex tape" in all state/federal cases yields 29 lawsuits reported in Westlaw (I'm sure there are synonyms that would reveal more litigation that has made it into Westlaw, and of course Westlaw covers only a small fraction of the cases).
From a legal standpoint, it's easy to offer some proactive suggestions for people creating a sex tape. One, don't make a sex tape unless you can fully control it technologically (or you don't mind if the tape becomes the most-downloaded video on the Internet). Of course, perfect technological control over digital bits may be impossible nowadays; for example, some of the celebrity sex tapes were allegedly leaked by computer repair personnel. Two, if you make a sex tape and don't fully control it technologically, clearly delineate with the other party/parties the disposition of the sex tape in various circumstances, such as breakup. From a lawyer's standpoint, a written contract would be nice.
(This last paragraph demonstrates a third immutable truth that I'm not oblivious to: proactive guidance about the production, control or distribution of sex tapes from a law professor is not that useful. But I digress...).
Unfortunately, once lawyers are brought in to deal with the non-consensual creation, use or distribution of a sex tape, they may not be able to do much to help the non-consenting party. Simply put, existing law provides poor controls for a non-consenting party. There is a long list of torts and crimes that MIGHT provide some control to the non-consenting party depending on the precise facts of the specific situation, including privacy rights (such as public disclosure of private facts), anti-child porn laws, obscenity, ECPA/wiretapping, copyright infringement, breach of contract, intentional infliction of emotional distress, cyberbullying or cyber-harassment and extortion (if the tape possessor makes a "do X or the tape goes up on YouPorn" type threat).
At the same, depending on the precise facts, it is also possible that the non-consenting party could have no effective recourse against a non-consensual public distribution of a sex tape. First, the laws simply may not fit the facts. Second, even if they do, some of the legal doctrines (such as privacy rights violations) are so "squishy" that they can be hard to enforce, and any criminal prosecution requires a prosecutor to actually take the case. Third, and most problematically, a sex tape posted online might quickly be reposted on multiple servers, including some overseas, exponentially increasing the costs, and substantially decreasing the likelihood, of successfully purging the tape from public view.
Meanwhile, the harm to the non-consenting party can be substantial. The sex tape be profoundly embarrassing to the party (even if the person didn't actually do anything "embarrassing"). The sex tape might provide forensic evidence of illicit adultery/cheating, and that could irreparably change social relationships. Finally, the tape can change the way people perceive the person. For example, a person may have economic or social prospects predicated on a wholesome image, such as beauty pageant contestants, in which case the tape can undermine that image and destroy economic prospects or social relationships.
I was recently discussing this issue with a colleague over lunch and we started kicking around the idea that maybe the sex tape problem would benefit from legislative intervention. Yes, in this limited circumstance for this specific problem, even I am willing to acknowledge that a new law might be worth considering. Our discussion covered two interrelated ideas:
1) It should be impermissible for someone to distribute a sex tape online without all depicted individuals having consented to the distribution. (We could easily extend that to offline distributions as well, but I'm just focusing on the problems of Internet publication now).
2) Intermediary online publishers should be subject to a DMCA-style notice-and-takedown scheme where a non-consenting party can provide suitably rigorous notice that the tape was distributed without his/her consent, in which case the intermediary has some time post-notification to remove the tape before facing further consequences. The notice-and-takedown scheme should also provide the poster with a counter-notification process that shifts the legal liability back to the poster and off the intermediary. Obviously, this requirement would need to override 47 USC 230. However, the notice-and-takedown scheme is essential to give the non-consenting party some effective recourse against the quick proliferation of a video to multiple sites.
I know these suggestion aren't perfect. Some of the obvious deficiencies:
* the definition of a sex tape. It's easy to define the paradigmatic situation, but there are a lot of edge cases that might be hard to resolve in a statutory definition.
* defining consent. Would written consent be required? If oral consent is enough, doesn't that open the door to lots of irresolute and time-consuming he-said/she-said factual disputes?
* the level of validation required for the takedown notice. We could just allow a person to claim identity and lack of consent, or we could require the person to go through some hoops before their takedown notice is effective.
* Constitutional considerations. Personally, I don't think these are especially problematic here, but they are always a consideration when regulating sexual material.
Finally, the most obvious problem is that this would proliferate yet another limited privacy law as a point solution to a specific problem instead of providing a more comprehensive omnibus privacy regulatory scheme preferred by privacy advocates. This would definitely be true, but the limited nature of the regulation and the remedies is a part of why this proposal appeals to me. If we are dealing only with sex tapes, and only requiring consent of the depicted individuals, the risks of plaintiff litigation frenzies, takedown spam and collateral content censorship goes way down, but still a particularly pernicious problem becomes much easier to solve.
So, what do you think? Comments are still down, but feel free to leave a trackback or email me and let me know if I can append your comment to this post.
COMMENTS:
From Colette (7/11):
I would advocate that the new law not only apply to on-line. The sort of law should cover dissemination of sex tapes (however defined) in any format (though the on-line medium is of course much worse because of the viral distribution options).
To the list of possible claims, in some circumstances you might have a defamation claim (e.g. if the sex tape editor/poster refers to the person depicted in the tape as a "porn star", but the person is not).
For the "getting/proving consent" (or perhaps the opposite: expressly stating non-consent) problem, the participants may fairly easily put their consent on the video itself. For most of the cases, that may work in place of a paper agreement re: consent. (One obvious problem of putting the consent on the tape itself, is make sure both (or all) parties have a copy of the tape, including the part of the tape that deals with the consent issue. In the real world, I can imagine that the party who is harmed may not keep a copy of the tape (it's old, from a long time ago, lost in moves, deliberately thrown out because s/he wants to put the incidence behind them). The other party who has it, could easily discard/delete the part of the tape where the "non-consent" is stated. Even if the harmed party expressly stated on the tape that s/he does not consent to distribution, that party would have no proof. Ahhh. This is why we lawyers wold prefer a written agreement. Much easier to track that down if it exists!
[Eric's response: I love it! From a legal perspective, it would be better if before the parties got frisky, they both looked into the camera and expressed their consent. Maybe something like "I consent to this video being posted to the web. Now, show me your &^%$!" Then again, this type of videoed consent to being videoed was instrumental in squelching Ashley Dupre's lawsuit against Girls Gone Wild.]
Posted by Eric at 10:38 AM | Content Regulation , Publicity/Privacy Rights | TrackBack
July 10, 2008
eBay Not Bound By Robinson-Patman Act--Windsor Auctions v. eBay
By Eric Goldman
Windsor Auctions, Inc. v. eBay, Inc., 2008 WL 2622791 (N.D. Cal. July 1, 2008)
The Robinson-Patman Act is a Depression-era law designed to reduce the ability of manufacturers to engage in price discrimination. At the time, large buyers (such as newly emerging chain retailers) were consolidating so much buying power that they were able to strongarm manufacturers into deals that were arguably unfair to the manufacturers and competitive but smaller retailers. The Robinson-Patman Act putatively tries to prevent these buyers from engaging in "predatory" buying prices by forcing the manufacturer to sell its goods at the same price to all similarly situated buyers. Prof. Paul Stancil published a nice summary of the law in Business Law Today in 2004.
I'm skeptical about the justifications for this law in the context of the Depression, but I'm crystal-clear about its validity today. In the modern age, the law has become farcically anachronistic, and I'm not sure I've ever met a single person who thinks the law is still a good idea. In practice, the Robinson-Patman Act is one of those obscure laws that typically arises only as a "gotcha" claim against defendants who don't know better or inadvertently run afoul of its technical provisions while engaged in normal commercial decision-making. There's certainly little evidence that the law actually improves competition or the marketplace.
In the case du jour, the plaintiff sells jewelry through eBay's live auction. (It looks like Live Auction is turning into quite the lawsuit trap for eBay; see my most recent blog post about it). Windsor sold nearly $1.5M in merchandise through the site in 2005 and 2006. Windsor thought sales would double in 2007 but instead realized that its sales were decreasing. Windsor alleges that eBay gave a competitive jewelry vendor, Molayem, better listing tools than provided to Windsor, and these tools allowed Molayem's listings to get more prominent placement in eBay's interfaces than Windsor's listings. Windsor claims that eBay's differential treatment between Windsor and Molayem violated, among other things, the Robinson-Patman Act.
The court dismisses the Robinson-Patman Act claim because eBay is not providing "commodities" under the act. The act, like many others, distinguishes between goods (covered) and services (not covered). At its core, eBay's relationship with its sellers is a service relationship of providing promotional/advertising services. Windsor tries to get around this by arguing that the software tools eBay provides its sellers ("Mr. Lister"/"Turbo Lister" and the "Batch Uploading Tool") and its documentation manuals are goods. This argument is not totally ridiculous; indeed, software is routinely treated as a "good" for purposes of UCC Article 2. However, even if true, the software is just a bit part of an overall service relationship, so the court rightly rejects the Robinson-Patman Act without leave to amend. However, the case isn't entirely over, as the court left open a claim for breach of the implied covenant of good faith and fair dealing.
I think this case is closely related to the search engine bias cases such as KinderStart v. Google. A website/search engine's decisions about what content to highlight (and, by implication, what not to showcase) can have dramatic effects on both consumers and vendors--to the tune of $1.5M in perceived foregone revenues in Windsor's case. The Robinson-Patman Act was a pretty feeble legal tool to challenge a website's interface decisions, but given the cash and emotions at stake, I'm sure plaintiffs will think creatively about other legal doctrines in their quest for recourse.
Posted by Eric at 03:00 PM | E-Commerce , Licensing/Contracts | TrackBack
July 05, 2008
Two Regressive Search Engine Advertising Rulings--Standard Process v. Total Health and Finance Express v. Nowcom
By Eric Goldman
It's not uncommon for courts to make judgments based on outdated understandings of precedent and technology, especially when dealing with dynamically evolving areas like Internet trademark law. Nevertheless, it can be a little dispiriting to read opinions that ignore modern sensibilities and look like they could have been written years ago. Two such cases came out in June:
Standard Process, Inc. v. Total Health Discount, Inc., 2008 WL 2337279 (E.D. Wis. June 6, 2008)
This is yet another case involving channel leakage leading to unauthorized Internet sales of legitimate goods. I've blogged about this issue several times, including:
* Australian Gold v. Hatfield (10th Cir 2006)
* S&L Vitamins v. Australian Gold (EDNY 2007)
* Standard Process v. Banks (E.D. Wis. 2008) [yes, same court and same plaintiff]
* Designer Skin v. S&L Vitamins (D. Ariz. 2008)
The last two cases were largely favorable for the Internet retailer. Unfortunately, this latest ruling barely acknowledges the S&L case (and ignores the Standard Process case altogether) and jumps back to the pro-plaintiff (and doctrinally corrupt) Australian Gold precedent as if it were the only relevant ruling. What happened?
The court says that the Internet retailer may be communicating implied sponsorship/favoritism of the trademark owner by (1) using the "we" and "our" pronouns to describe the product on its website, apparently creating an overly familiar discourse, and (2) buying keyword advertising triggered by the trademark and ranking well for it. This implied sponsorship/favoritism costs the Internet retailer both a first sale defense and a nominative use defense. No SJ for the Internet retailer on trademark infringement.
The court's emphasis on first-person pronouns is ticky-tack at best. I'd sure love to see some consumer survey evidence to show that the usage actually led consumers to make some association between the retailer and the manufacturer. I'd be really surprised if consumers drew any of the inferences made by the courts.
Similarly, thinking that consumers assume that high ad placement for the trademark implies sponsorship by the trademark owner is SO five years ago. Though this issue has come up in a few prior cases (for example, an analogous issue was central to the Playboy v. Netscape case from 2004), I've never seen any empirical evidence validating this assumption, and I am fairly confident that a reliable survey conducted today would thoroughly destroy this line of thinking.
In any case, the breezy way that the court tossed aside the nominative use defense highlights that the defense isn't all that useful to Internet trademark defendants. For this reason, I continue to believe that we need the trademark use doctrine (which, I understand, wasn't at issue here) to screen out cases before defendants have to rely on such a flimsy doctrine like nominative use.
The case also discusses whether the Internet retailer committed false advertising by saying that it bought from authorized sources. Rebecca parses this issue.
Finance Express LLC v. Nowcom Corp., 2008 WL 2477430 (C.D. Cal. June 18, 2008)
Finance Express and Nowcom are competitive providers of "software to automate and facilitate credit relationships between used automobile dealers and lenders." Finance Express acquired some software and tried to migrate users of that software to its standard platform. This transition appeared to trigger a scramble for customers in transition, and Nowcom launched a self-acknowledged "aggressive" marketing campaign for those customers that included the following features:
* registering several domain names containing Finance Express trademarks
* posting a self-laudatory press release at those domain names urging customers to transition to it. Oddly, this press release contained an "About Finance Express" section that the court said made it look like a joint press release between Nowcom and Finance Express.
* including Finance Express' trademarks in the metatags, which the court describes using the archaic term "keyword stuffing."
* "keying" (another archaic term) by buying Finance Express' trademarks as keyword triggers at the search engines to trigger banner ads. The court expressly refers to banner ads, but in the discussion it's clear that Newcom bought typical text ads.
If Nowcom's marketing campaign had only 1 of these features, a court might have been more willing to give it a free pass. But the overall package of competitive features was clearly overwhelming to the court. It was easy for the court to see competitive trademark references plus a perceived injury (Finance Express had transitioned only 250 dealers when it projected it would transfer 850) and blame the technology.
The court goes through numerous gyrations to find potential trademark liability here. For example, Finance Express has a number of weak descriptive trademarks, but the court circularly uses the fact that Nowcom targeted the trademarks as evidence that the descriptive trademarks had derived secondary meaning. The court also struggles with the Ninth Circuit's ambiguous caselaw on whether metatags and "keying" constitutes a use in commerce, but the court says that it sees lots of commercial activity on Nowcom's part, so it must qualify. (Cite to two 2006 cases Edina Realty and Humble Abode--hey judge, there have been just a few use in commerce cases since 2006!). And finally on the likelihood of consumer confusion question, the court uses the initial interest confusion doctrine as a crutch (extensive cites to Brookfield). Overall, this analysis reads more like a ruling from 1999 than 2008. Preliminary injunction for Finance Express.
Unfortunately, I'm not sure how many practical lessons we can learn from this case.
* The domain names. I don't know many trademark lawyers who would greenlight one competitor's purchase of domain names containing the trademarks of a competitor, and it's a little unsettling to see Nowcom use the technique in 2007. Indeed, the court finds the practice completely meritless, concluding "the only purpose Nowcom could have had in registering Finance Express' domain name was to direct potential consumers of Finance Express' products to Nowcom's website."
* Metatags/Keyword Stuffing. I have argued against including competitive trademarks in keyword metatags on a straight cost-benefit basis because they are relatively ineffectual from an SEO standpoint but courts--like this one--are easily spooked by them and exaggerate their technological power.
* Keying. The court reflects the overall confusion about "keying" in the Ninth Circuit, but the fact that the court doesn't even understand the difference between banner ads and text ads undercuts this ruling's credibility.
Posted by Eric at 09:09 PM | Search Engines , Trademark | TrackBack
July 01, 2008
June 2008 Quick Links
By Eric Goldman
Trademarks/Domain Names
* Utah Lighthouse Ministry v. Foundation for Apologetic Information and Research, 2008 WL 22043807 (10th Cir. May 29, 2008). CMLP writeup. Nice 10th Circuit win for a gripe site against trademark infringement and cybersquatting. This case, plus the SKI VAIL case, indicate that the 10th circuit is making progress undoing the harm it created in the Australian Gold v. Hatfield case.
* Georgia has a new anti-phishing law (16-9-109.1) that acts as a para-trademark law. See my comments on the analogous California anti-phishing law.
* After initiating a trademark lawsuit against a consumer review site and soundly losing in court, Lifestyle Lift paid $17,500 to settle its own lawsuit and avoid claims for legal fees under Rule 11 and the Lanham Act.
* Marty reports on a German case saying that white-text-on-a-white-background is a trademark use.
* Update on the battle over the trademark registration for "SEO."
* Will TLD proliferation lead to a new open era in domain name administration, or will the resulting anarchy just reinforce that top search engine placement is the really important online real estate? It seems like the currently limited number of TLDs has some benefits from a bounded rationality standpoint, and those benefits will be lost in a cacophony of unknown TLDs.
Patents
* My colleague Colleen Chien has posted "Patently Protectionist? An Empirical Analysis of Patent Cases at the International Trade Commission" (forthcoming William & Mary Law Review). She empirically demonstrates that the ITC mostly involves disputes between two domestic litigants, making it a redundant battleground with federal district court but nevertheless an attractive venue for plaintiffs due to a number of procedural advantages. She makes a number of recommendations to eliminate the litigation gamesmanship offered by having parallel venues. Check it out.
Search Engines
* Udi Manber, chief algorithm keeper for Google, reiterates why it's silly for lawyers and judges to put too much legal emphasis on the relative placement of search engine results, saying "it's definitely the case that if you do the same search on a different cluster, you may get slightly different results at a given time. It's also the case that if you do the same search on different days you may get different results, because some of the results are things we indexed five minutes ago."
(Over)Regulation
* In response to an enforcement effort by the NY AG's office, several Internet access providers have blocked access to newsgroups that are putatively sources of child pornography. See the NYT story and the NY AG press release. In practice, this means wholesale takedowns of newsgroups that may have nothing to do with child porn. For example, Verizon is killing all USENET hierarchies except comp.*, misc.*, news.*, rec.*, sci.*, soc.*, and talk.*. Wired suggests this is the death of online intermediary freedom as conceptualized in 47 USC 230. Of course, 230 never protected intermediaries from criminal exposure for child porn, and this isn't the first time that an access provider has knuckled under to the NY AG's office. See the BuffNet enforcement action from 2001.
* Ohm, Paul. The myth of the superuser: fear, risk, and harm online. 41 UC Davis L. Rev. 1327-1402 (2008). A neat article on how regulators manufacture a fake bogeyman, the unbeatable "superuser," as a justification for expansive regulatory power.
* No evidence that data breach disclosure laws actually help reduce identity theft. Surprised?
* The FTC wants civil enforcement authority for spyware actions. Haven't they heard that the adware battle is already over...and they won?
Contracts
* Mark Radcliffe expresses concern about the ALI's proposed software licensing project on open source licenses.
* Sarah Bird on a messy contract lawsuit involving an SEO contractor.
Anonymity
* Tendler v. www.jewishsurvivors.blogspot.com, 2008 WL 2352497 (Cal. App. Ct. June 10, 2008). A subpoena request to identify a blogger doesn't support an anti-SLAPP cause of action.
* In the AutoAdmit lawsuit, Doe 21's motions to squash the subpoena and proceed anonymously were both denied. David Hoffman provides an update on the case.
Event Tickets
* Chicago has moved against eBay for reselling tickets in violation of its amusement tax law.
* The Ticketmaster v. RMG case ended with a default judgment granting a permanent injunction and $18.2M in damages.
General
* Vanity Fair: How the Web Was Won.
* Paul Levy blogs about a plaintiff's effort to bypass 230 by suing the authors of complaints about the vendor and then joining the consumer complaint site as a necessary party as a cost-increasing tactic.
* BusinessWeek on emerging technological tools to protect workers' attention against unwanted/untimely interruptions.
* Text message-savvy kids educate the North Carolina DMV about the meaning of the term "WTF," which was used on a license plate example on the DMV's website.
* I have one free pass to OMMA Behavioral in San Francisco July 21. First person to send me an email asking for the pass gets it.
Posted by Eric at 12:32 PM | Adware/Spyware , Content Regulation , Derivative Liability , Domain Names , E-Commerce , Internet History , Licensing/Contracts , Marketing , Patents , Privacy/Security , Search Engines , Trademark | TrackBack