Web Vendor Dispute Gets Ugly–Ground Zero Museum v. Wilson

By Eric Goldman

Ground Zero Museum Workshop v. Wilson, 2011 WL 3758582 (D. Md. Aug. 24, 2011)

Disputes like these make me wonder if we can’t find some way to get along. Suson runs a non-profit museum focused on the September 11 tragedy. Wilson runs an Internet shopping cart service. Wilson offered to help Suson with the museum website by adding shopping functionality. Wilson also helped Suson get free web hosting from a third party vendor, A-1 Hosting. Then, over what seemed to be a minor thing, the relationship soured in 2009. Wilson turned off the shopping cart functionality and reverted the website back to a prior version; Suson claims Wilson also took down the museum website. Wilson subsequently complained that the museum website continued to use his IP, and he sent an ineffectual takedown notice to A-1 Hosting. Wilson also allegedly badmouthed the museum to A-1 Hosting, allegedly causing them to stop providing free hosting. Wilson also set up a quasi-gripe site, cam-scam.com (now down), and allegedly a fake MySpace page, that said or implied unflattering things about Suson.

From a relatively simple commercial dispute involving a non-profit enterprise comes a cascade of litigation, including complaints and countersuits. I could seriously write my entire Internet Law exam from this situation. It touches on almost every topic I cover in class. This isn’t the worst breakup I’ve seen, but it appears that the parties are using litigation as a sledgehammer, especially given the low dollars and stakes at issue.

1201 Circumvention. Suson claims Wilson committed a 1201 circumvention by administratively logging into the museum website and making changes in excess of his authorization. The court rejects this claim, saying “using a password or security code to access a copyrighted work, even without authorization, does not constitute ‘circumvention’ under the DMCA” and citing to several other cases (including the IMS and Egilman cases). The court also says that even though Wilson resigned his technical role, his continued login to the website was authorized until Suson changed the password. Finally, disabling the shopping cart wasn’t a circumvention because the functionality lived on Wilson’s site, not Suson’s.

Computer Fraud & Abuse Act. The CFAA claim fails on summary judgment because “Plaintiffs have produced no evidence to back up their assertion that Wilson damaged the website or that his actions caused at least $5,000 in economic damages in one year.” The only allegation of harm is that Wilson “stripped the metatags” (whatever that means) when he reverted the website back to the prior version, and the court can’t make heads or tails of that. Suson also hired an SEO to redo the metatags for $8k, but the court can’t consider this evidence either because it wasn’t properly authenticated and the payments took place over more than one year (and thus perhaps didn’t trigger the $5k/year CFAA threshold).

Trespass to Chattels. This was a very confused discussion. The court says the “chattel identified in Plaintiffs’ trespass claim is the GZM website, or alternatively specific webpages within the site. Plaintiffs contend that Wilson deprived GZM of possession of its website and damaged the chattel by inserting a redirect command.” This seems to conflate access to a virtual asset (the web page) and use of a tangible asset, the computer server. The court focuses on the virtual asset, but that should be impossible to “trespass,” or any trespass claim should be preempted by copyright law. Reinforcing the court doesn’t understand what it’s talking about by lumping together three very disparate items, the court continues:

Although websites are not tangible property in the traditional sense, courts in Maryland, New York, and elsewhere have been willing to recognize claims for conversion or trespass to chattels involving certain digital things, such as websites and domain names and computer networks.

The court then cites cases finding conversion of domain names and a “website,” plus the Cyber Promotions case where the court was clearly talking about trespass of the physical server. On this basis, the court says that copyright law doesn’t preempt the trespass to chattels claim. Too bad the court couldn’t make a more fine-grained distinction between tangible and intangible assets, because the trespass of an intangible asset claim should be preempted by copyright law.

The court then further finds a prima facie trespass to chattel because Wilson dispossessed Suson of the “current” website when he reverted to the older website version. However, whether Wilson acted with the requisite scienter has to go to the jury. Wilson’s response that he co-owed the copyright in pieces of the website isn’t availing; even if true, he can’t dispossess his co-owners of their rights.

Note the unexpected result here: the CFAA claim failed and the common law trespass to chattels claim survived. How often do you see that? But this result occurs only because the court mixes its metaphors and treats the website owner’s lack of virtual access to administrate the website as a physical dispossession.

Defamation. Because of the nature of the virtual interactions, the court struggles with deciding which law applies to the defamation claim. The court says:

Applying lex locus delicti is inconclusive because the websites Wilson created were accessible on the Internet from any location and the record on summary judgment does not identify the location of A1-Hosting or the unidentified third parties when they received the emails with alleged defamatory statements, so the exact place of publication for these statements is unknown.

The court finally decides that New York law applies because “Suson lives in New York, the museum is located there, and the bulk of Plaintiffs’ business activities take place there. In addition, the alleged defamatory statements relate to Plaintiffs’ business operations in New York. Accordingly, the brunt of the damage to Plaintiffs’ reputation or business interests will be experienced in New York, and New York has the most significant relationship to the alleged defamation.”

The court rejects defamation against all of the allegedly defamatory statements. If you’re an Internet defamation junkie, it’s worth reading the opinion.

Tortious Interference. This claim, based on Wilson’s communications to A-1 Hosting, fails because Wilson didn’t do anything improper.

512(f) Bogus Takedown Claim. Wilson didn’t violate 512(f) because his takedown notice to A-1 Hosting was ineffectual. The court doesn’t cite the Amaretto v. Ozimals opinion which reached an identical conclusion.

Copyright Co-Owner Counterclaim. The court lets Wilson plead that he made such contributions to the museum website that he became a co-owner, and therefore he is entitled to an accounting of profits. This is why you never let anyone modify your website code without a written agreement spelling out their rights.

Related Disputes. This is just the latest blog post on website co-ventures gone horribly awry. Other posts in the series:

* Holding on to a Domain Name to Gain Leverage in a Business Dispute Can Constitute Cybersquatting — DSPT Int’l v. Nahum

* Web Developer Didn’t “Convert” Website–Conwell v. Gray Loon

* Taking Intangible Electronic Files is Criminal Fraud–NM v. Kirby

* Cautionary Tale of Website Co-Ownership–Mikhlyn v. Bove

* Another Cautionary Tale of Joint Website Ownership–TEG v. Phelps

Hey people, when you have vendors help run your website, PLEASE dot your i’s and cross your t’s. When the shit hits the fan and the contract isn’t in place or clear enough, the resulting litigation fusillade can destroy your life.

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