Technology & Marketing Law Blog: Publicity/Privacy Rights Archives

Technology & Marketing Law Blog

May 03, 2013

Recap of Washington State’s Employer Social Media Password Bill

SB 5211 (passed by Senate April 27, 2013)

Both chambers of the Washington legislature passed Substitute Senate Bill 5211, and it now awaits the Governor’s signature. No Washington legislators voted against it.

Here are the key provisions:

- the bill restricts employers from (1) asking for passwords; (2) engaging in shoulder-surfing; (3) asking employees to change settings; or (4) asking employees to add them as friends;

- the statute does not define it, but uses the phrase “personal social networking account” to describe what is off limits;

- the statute contains a carve-out for employer investigations, but limits this to scenarios where employers merely request information (and not passwords) in order to investigate (1) legal violations or (2) suspicion of misappropriation by employees;

- the statute excludes employer-supplied devices, as well as intranets and other platforms “that [are] intended primarily to facilitate work-related information exchange, collaboration, or communication by employees or other workers” [Twitter!];

- finally, the statute provides for a private right of action and authorizes a court to award $500 in statutory damages and attorney’s fees.

The statute tackles the social media ownership question by excluding accounts that are “provided by virtue of the employee’s employment relationship with the employer .. [or] online account[s] paid for or supplied by the employer.” Earlier versions of the statute had more specific definitions for what constitutes a social network. One iteration also limited the private right of action.

Although I acknowledge that employee social networking activity that is private should be off-limits for employers, I still think this was a solution in search of a problem. With states’ well established failings in the era of regulating the internet, I predict this will create more problems than it will solve. Among other things, it's unclear what is covered by "social media" and equally unclear when an account is "personal" or "business"-related. (In practice they often seem mixed.) Eric delves into some of these issues in taking a look at California's social media legislation in this post: "Big Problems in California's New Law Restricting Employers' Access to Employees' Online Accounts."

Two approaches legislatures should consider taking when enacting these statutes is (1) making them only apply to prospective employees; and (2) getting rid of a private right of action or, at least, including an administrative exhaustion component. The Littler law firm has a great roundup of legislation from various states as well as some of the pitfalls these statutes may present: "Social Media Password Protection and Privacy -- The Patchwork of State Laws and How it Affects Employers" [pdf].

Other coverage on employer social media bills generally:

Littler: "Social Media Password Protection and Privacy -- The Patchwork of State Laws and How it Affects Employers" [pdf]
WIlliam Carleton: "Checking in on sate social media password laws"
Eric Meyer: "Wooooo pig sooie! Arkansas gets a workplace social media privacy law"
Lexology "Three more states hop on the social media legislation bandwagon"

[image credit: shutterstock/Andre Blais "high-tech background with targeted eye-scan"]

Posted by Venkat at 10:49 AM | Privacy/Security , Publicity/Privacy Rights , Trade Secrets

April 24, 2013

Misguided Catfishing Scheme Leads to Discipline of College Students -- Zimmerman v. Ball State

[Post by Venkat Balasubramani with a comment from Eric]

Zimmerman v. Ball State Univ., et al., 12-cv-01475-JMS-DML (S.D. Ind. Apr. 15, 2013). (The complaint.)

Zimmerman and Sumwalt were students at Ball State University, a public university in Indiana. They apparently did not get along with their roommate, and they played a number of pranks on him. Once, when the roommate was away on vacation, they placed a sandwich in his bedroom, leaving it to rot and “preventing [him] from accessing his room when he returned.” Another prank involved setting up a Facebook page for a fictitious female high school sophomore named “Ashley,” and using the fake account to correspond with the (now-ex) roommate.

The two plaintiffs fostered the relationship between the fake Ashley and the ex-roommate, who ultimately suggested that he meet Ashley at a local movie theater. When the ex-roommate arrived at the movie theater’s lobby, the plaintiffs confronted him, disclosed that the Ashley profile was fake, and taped the whole thing. They then posted the recording to YouTube with the title that the former roommate “was a pedophile.”

Ball State received a complaint from the roommate and charged plaintiffs with two violations of the Conduct Code: (1) first for creating a intimidating or hostile environment; and (2) for using an audio, video, or photographic device to invade the roommate's privacy. Both students (who were represented by counsel) “accepted responsibility” for their conduct and signed documents acknowledging that they violated the provisions of the conduct code. At a later meeting, the academic review board recommended suspension for a year, as well as:

certain reflection and action to raise awareness of fellow students regarding the responsible use of social media.

At the request of the student conduct czar, the review board added additional sanctions, which included probation upon their return, and a no-contact order with the ex-roommate.

The students appealed the sanction on a variety of grounds. Their appeal within the university system was rejected. The students then sued, asserting Due Process and First Amendment violations. They also argued that the code of conduct should not be applied to regulate off-campus conduct.

Was their conduct objectionable: the plaintiffs asserted a variety of “ever-changing” arguments, as the court describes them, but one of the key arguments was that the university only had the power to regulate conduct that was “unlawful or objectionable.” The court says that both the sandwich prank and the Facebook + YouTube prank were “objectionable”. The court says that no reasonable juror would find the sandwich prank anything other than objectionable. The Facebook prank, the court says, does not even present a close question. Not only did the students engage in “catfishing,” the court says they took this one step further. They posted the video of the target’s reaction and labeled him a pedophile.

Plaintiffs’ First Amendment argument fails: Plaintiffs also raised a First Amendment argument, arguing that their Facebook communications and their YouTube video were both expressive. This argument gets little traction with the court. First, the court says that this does not absolve them of responsibility for the sandwich prank. Second, the court says that this is part of an overall scheme that the plaintiffs were disciplined for. The students tried to rely on US v. Alvarez, the Stolen Valor case where a plurality of the Court rejected Congress’ attempt to punish lying about military honors, but the court says that here the statements were made with the intent to inflict harm on the victim and actually caused such harm. In any event, the court says that the official actor defendants are entitled to qualified immunity for their decision.

What a mess.

There were a lot of reasons why this was a tough case for the students. The fact that they violated Facebook's terms of service. (CFAA violation alert!) The fact that they posted a video calling their ex-roommate a pedophile. The fact that they signed an acknowledgement that they violated the code of conduct and then tried to sue the university over it. The list goes on.

It's tempting to view the case as presenting a First Amendment conflict that threatens the ability of students to mouth off on social media, but that's a tough sell. As the court notes, there's plenty of unprotected speech that they could have (and were) been disciplined for. Any liability as a result of speech and conduct that would cause emotional distress in a reasonable person is probably acceptable from a First Amendment standpoint, particularly where a private figure is involved. At a certain point, a prohibition on "objectionable" speech that is used to squelch speech on matters of public concern could certainly present a First Amendment problem, but that wasn't the case here.

In the meantime, this case serves as a cautionary tale to remind college students that catfishing your ex-roommate and posting a video of his reaction isn't such a great idea. Then again, I guess the plaintiffs should look on the bright side that they were just disciplined, and not charged with something more serious, like a violation of the Computer Fraud and Abuse Act or for violation of an e-personation statute.

Eric's Comment: I did a search this morning in Westlaw and Lexis and, as far as I can tell, this is the first case using the term "catfishing." Citing the Urban Dictionary (!), the court defined catfishing as “[t]he phenomenon of internet predators that fabricate online identities and entire social circles to trick people into emotional/romantic relationships (over a long period of time).”

Jake's Comment: On a side note, the NFL draft is tomorrow night at and it will be interesting to see just how much the infamous catfish story degraded Manti Te'o's once-highly-touted draft status. The situation is obviously different since Te'o is a public figure, but the controversy may end up costing him millions if the he falls in the draft. Several current players have mentioned that the hoax will undoubtedly cause locker room distractions that GMs are keen to avoid.

[image credit: Shutterstock/Bigredlynx - "Catfish Fry Cook"]

Posted by Venkat at 10:30 AM | Content Regulation , Privacy/Security , Publicity/Privacy Rights

March 26, 2013

Ex-Lover Can Use Non-Disparagement Provision to Suppress Revenge Porn--Walls v. Klein

[Post by Venkat Balasubramani]

Walls v. Klein, 2013 Tex. App. LEXIS 2462 (Tx. Ct. App. 4th Dist. Mar. 13, 2013)

Walls and Klein were in a romantic relationship that soured. The parties volleyed legal threats but ultimately entered into a settlement agreement. In exchange for the payment by Klein of $30,000, the parties settled their claims and agreed to a non-disparagement and no-contact term:

The Parties agree and acknowledge that they will not disparage one another. The Parties will have no further contact with each other in any form, their respective family members and close friends relating in any way to the [claims asserted against each other or underlying factual matters] . . . .

Walls also agreed that she would not make any claims or complaints regarding Klein to any agency (e.g., the police dept.). The agreement provided that it was intended to be enforceable, including through specific performance, and that both parties had entered into it voluntarily. (They both had counsel, at least when they entered into the agreement.)

Shortly afterwards, Walls sought and obtained a TRO against Klein, allegedly because Klein continued to “stalk, harass, and humiliate” Walls (among other things, by trying to run Walls and her pets over). Klein responded with his own request for an injunction, asserting claims for defamation, breach of contract, and invasion of privacy. He alleged:

Walls was needlessly walking in front of his residence, sending threatening emails to his close friends, sending anonymous, disparaging emails to members of the religious institution he attended . . . . Klein [also] alleged Walls posted on her Facebook page that she intended to publically disparage Klein with the launch of a website containing photographs of him that Walls had taken while they were still in a relationship.

The trial court denied Walls’ request for an injunction and granted an injunction in favor of Klein. The injunction prohibited Walls from:

(1) Communicating . . . with any person, entity, organization, agency or religious institution regarding or concerning Klein . . . concerning any allegation or matter set forth in the Agreement and any exhibits attached thereto, except as may be necessary to defend herself in this action, or to respond to an investigation by a governmental agency initiated by that agency; (2) Publishing or attempting to publish on any website, including but not limited to Facebook, any fictional narrative concerning or based, in whole or in part, on Klein, without his written consent or without leave of court; (3) Publishing to any third parties in any form or fashion any photographs or depictions of Klein, without his written consent or without leave of court; (4) Interfering with Klein's personal, familial, or business relationships or the relationship between Klein and [his religious institution] by intentionally, knowingly, or recklessly making anonymous false complaints and reports to governmental, private, and religious regulatory agencies; . . . and (7) Disparaging and/or defaming Klein in any mode, form, or fashion whatsoever.

On appeal, the court affirms, although it slightly modifies the scope of the injunction.

Is the injunction a prior restraint?: Ordinarily an preliminary or temporary injunction would run into prior restraint issues, but here the court says the question is whether Walls waived her speech rights unequivocally. Based on her testimony, the fact that $30,000 changed hands, and the fact that the agreement contained language saying the parties voluntarily entered into it, the court finds waiver, and thus no prior restraint issue. The court also footnotes that this is essentially a private dispute between parties that does not implicate issues of public concern.

Is the injunction overly broad?: The court says that there is credible evidence (via a Facebook post) that Walls intended to create a website/art project sliming Klein. The project was ostensibly about a fictional narcissistic, passive-aggressive drug dealing prostitute named Samuel, but there were numerous similarities between the fictional character and Klein that made it clear it was really about Klein. The court says that this falls within the no-contact and non-disparagement provisions of the agreement. The court footnotes the question of whether Klein impliedly consented to Walls’ right to use any photographs of him after the relationship ended, but says at the preliminary injunction phase, Klein has the right to preserve the status quo. Therefore, subsections (2), (3), and (7) of the injunction are OK.

The court finds subsection (4) appropriate as well, on the basis that Walls allegedly lobbied church leadership to prohibit Klein from engaging in certain activities, alleging that he dealt drugs while his child was in the house. The court says this provision of the injunction falls within the non-contact and no-disparagement provision as well.

Finally, the court modifies the scope of subsection (1), which prohibited her from communicating with third parties regarding Klein. The court says this could be read to impermissibly prohibit her from reporting illegal conduct. The court modifies this provision to provide that she can report to law enforcement “truthful incidents of illegal conduct directed at her.”

No abuse of discretion: Finally, the court says that it was not an abuse of discretion to enter the injunction. Klein demonstrated that Walls made accusations and threats, and generally she tried to interfere with his activities at church. The court also cites to Walls’ statement of intent to publish a website containing photographs of Klein and “portraying him a disparaging light.” According to the court, Klein adequately showed that Walls’ activities posed a threat of irreparable harm.

I confess I’ve never understood non-disparagement clauses in settlements or contracts. This case illustrates that they can have broad reach if they are enforced, going well beyond merely prohibiting defamatory statements or stuff that is considered to be harassment. This case is a good illustration that you should carefully consider whether you want to agree to such a clause.

The relationship between an agreement and the prior restraint issue is also interesting. Not only will a non-disparagement clause be used to justify restriction on a far greater quantity of speech than would otherwise be possible, the court relies on the agreement to say there is no prior restraint. This is a double whammy for Walls as a speaker.

Finally, and perhaps most interestingly, it’s interesting to view this against the overall context of the revenge-porn discussion that has recently lit up the internet. (See Eric’s post at Forbes, which generated a fair amount of push back.) Although the court does not discuss the precise nature of the photos Walls plans to use, the court notes that she intended to use photos she took of him while they were in a relationship and implies they were intimate. The conventional wisdom around revenge-porn is that it’s perpetrated by men against women, and this is a counter-example. Perhaps an isolated counter-example, but it’s worth noting that taking revenge on the internet using photos collected during the course of a relationship is not exclusively the province of men.

[image credit: Shutterstock/ollyy: man telling an astonished woman some secrets]

Posted by Venkat at 01:48 PM | Content Regulation , Publicity/Privacy Rights

March 18, 2013

It's Legally Okay if Google Thinks Your Name and Erectile Dysfunction Drugs Have Something to Do With Each Other (Forbes Cross-Post)

By Eric Goldman

Stayart v. Google Inc., 2013 WL 811793 (7th Cir. March 6, 2013).

Would you be upset if people searching for your name are prompted to search for your name plus the name of an erectile dysfunction drug like Viagra or Cialis? For example, if you search for "Eric Goldman," a search engine might suggest that you search for "Eric Goldman Viagra." I suspect many of us would never discover that the search engines were doing this, and those who did would find it perplexing but amusing.

(The reasons why a search engine might make this suggestion aren't complicated or nefarious. "Sploggers" build web pages that remix content from legitimate web pages as search engine "bait" to attract searchers to pages that advertise or link to illicit goods such as pharmaceuticals that require a prescription. As a practical matter, splogged pages don't show up well in search results, but they may influence the search engine's suggestion algorithms anyway).

As it turns out, this scenario isn't hypothetical. Google suggested that searchers on "Bev Stayart" (a/k/a Beverly Stayart) search for "bev stayart levitra" (Levitra is an erectile dysfunction drug). See the recent screen shot on the right. Many of us would shrug this off; in contrast, this situation has launched Bev Stayart into a multi-year, multi-lawsuit campaign against Google and Yahoo (see this page for my chronicle of her lawsuits and related suits).

None of her lawsuits have made any progress at all. Last week, she notched yet another loss in court. The Seventh Circuit Court of Appeals dismissed her lawsuit--again--in a brief and unceremonious opinion befitting the lawsuit's lack of merit.

Stayart argued that Google's suggestions using her name violated her publicity rights under Wisconsin's publicity rights statute. There are probably a dozen reasons why this claim should fail, but the court explores only two.

First, Wisconsin's law permits the commercial use of a person's name when it's newsworthy or in the public interest. The court says that exception applies to Stayart because her ongoing litigation crusade has caused her name to be associated with erectile dysfunction drugs, and people have a legitimate right to search for court records related to her case. The fact that Bev Stayart's vanity search results now suggest erectile dysfunction pills is a predictable Streisand Effect of her litigation, but the court is uncomfortably "punishing" a plaintiff for enforcing his/her rights. Further, the court's rationale is specific to Stayart, and thus may not apply to other cases.

Second, the Wisconsin statute requires that the commercial use be "substantial" and not "incidental." In a terse and unenlightening paragraph, the court says that Stayart didn't convince the judges that Google's search results made more than an incidental commercial use of Stayart's name.

Rather than rely on these technicalities, the court should have looked to the Wisconsin Court of Appeals, which just issued an opinion in Habush v. Cannon (not cited by the 7th Circuit) that buying keyword ads on a person's name doesn't constitute a commercial "use" of the name under Wisconsin's publicity rights statute. While the Habush opinion partially relied on the invisible nature of the keyword triggering, I think its logic should broadly apply to all organic search activity. In contrast, because of the Stayart court's narrow rationales, it's unclear how the opinion will apply to other cases.

Still, I think a favorable macro-trend is emerging for Google, Yahoo, Bing and other search engines. Putting aside the legal machinations of how they get there, courts are not receptive to legal attacks on organic search operations, whether the claim is based on defamation (see, e.g., the futile lawsuit by Dr. Hingston), trademark law or publicity rights. Thus, the Stayart ruling is philosophically consistent with the recent opinion in Multi-Time Machine v. Amazon, which rejected a trademark lawsuit over Amazon's search results merchandising of other vendors' goods. These rulings reinforce that plaintiffs suing to force changes to organic search results--or the search engine's suggestions of alternatives--are almost certainly doomed to fail in court, one way or another.

[Photo Credit: Sean Nel / Shutterstock.com]

Posted by Eric at 09:55 AM | Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

March 14, 2013

Court Rejects Attempt to Hold Software Company Liable for Surveillance Conducted by Its Customer – Luis v. Zang

[Post by Venkat Balasubramani]

Luis v. Zang, 12 cv 629 (S.D. Oh. Mar. 5, 2013)

Divorces have spawned some of the most interesting privacy disputes, such as the cases involving whether GPS surveillance of a vehicle violated one spouse’s privacy rights and whether accessing webmail using a shared computer constitutes a violation of privacy laws. This particular case involved the use of “WebWatcher” software that ostensibly allows people to monitor the computer-related activities of individuals. We blogged on a separate matter involving this divorce (see “Lawyer Who Advised Brother-in-Law Regarding the Use of Spyware on His Wife Disqualified in Ensuing Privacy Dispute”), but this particular lawsuit is one of a three lawsuits spawned out of the divorce; two of which were filed by Javier Luis (against a variety of defendants) relating to the monitoring of his communications with Cathy Zang:

[a]lthough Plaintiff alleges that he has never met Cathy Zang in person, he alleges that he virtually met her, via a "Metaphysics" internet chat room, in January or February 2009 (Doc. 39, P 15). Shortly thereafter, Plaintiff alleges that he began to have "daily" communications, in the course of a "caring relationship" with Ms. Zang via the telephone and computer.

[Zang filed a separate lawsuit as well.] The key question before the court is whether Access Technologies, maker of WebWatcher, can be held liable for the monitoring activities conducted by its customer.

Whether WebWatcher ‘Intercepts” Communications: The court struggles with several semantic questions surrounding whether there has been an ‘interception’ as defined by the wiretap statute: (1) is information captured instantaneously; (2) is the information captured transmitted locally; and (3) is the information re-routed. The court rejects Access’ argument that there has been no interception, noting that the facts at this stage indicate a near-instantaneous capture and re-routing of information to a remote location.

Can Access be held liable for its customers’ conduct: Even assuming an interception occurred, the court says Luis’s claims fall short because remedies are only available against the individuals that “intercepted, disclosed, or intentionally used” communications in violation of the statute. The court says that the statute does not contemplate imposing civil liability “on software manufacturers and distributors for the activities of third parties.” While there is a provision of the statute that prohibits the "[m]anufacture, distribution, possession, and advertising [of devices” that can be used for interception]," (and imposes criminal liability for this activity) the court says that the civil remedies provision does not extend to this part of the statute.

The court also dismisses the litany of state law claims brought against Access (invasion of privacy, infliction of emotional distress, “bullying and harassment”) on the basis that Access did not have any knowledge of Mr. Zang’s use of the product and was not a party to any agreement that involved unlawful interception of communications. (The court does not mention Section 230, but that sounds like a fairly plausible basis for rejecting the state law claims as well.)
__

Although the two cases analyzed slightly different statutory provisions, this dispute is reminiscent of the SpectorSoft case, where a federal district court in Tennessee held that an ex-spouse could not assert federal or state law claims against the company that made monitoring software. In SpectorSoft, the court focused on whether the disclosure of communications was knowing or intentional. In this case, the court says there was an interception, but says that liability for the interception does not extend to third parties. Either way, the result is the same: in the garden-variety case, it's difficult to hold the software developer liable for interceptions effected by customers and clients. This decision reaffirms what is a fairly helpful result for developers of these types of software providers.

As far as derivative liability goes, both with respect to the Wiretap Act and the Computer Fraud and Abuse Act, plaintiffs have fared poorly in holding third parties liable for the actions of the people who actually did the monitoring, intercepting, or accessing. Courts have been reluctant to extend the reach of these statutes to third parties who did not directly participate in the allegedly wrongful activities themselves.

It's worth flagging that in addition to lawsuits from private parties, these software providers also have to worry about FTC actions. As noted in this 2008 Wired article, the FTC shut down the websites of a company that sold 'DIY spyware'.

[image credit -- kar/shutterstock: eyeball spy catcher]

Posted by Venkat at 10:25 PM | Adware/Spyware , E-Commerce , Privacy/Security , Publicity/Privacy Rights

March 13, 2013

Ex-Employer's Hijacking of a LinkedIn Account Is a Publicity Rights Violation--Eagle v. Morgan

[By Venkat with comments from Eric]

Eagle v. Morgan, 11-4303 (E.D. Pa. Mar. 12, 2013)

We’ve previously covered this dispute over a LinkedIn account. (See Another Set of Parties Duel Over Social Media Contacts; Battle Over LinkedIn Account Between Employer and Employee Largely Gutted.) Surprisingly, the case went to trial! Although the court finds that plaintiff adequately proved several of her claims (an impressive feat, given that she proceeded pro se), she ultimately loses the case. The court declines to award damages, finding that she did not prove any with reasonable certainty.

Background: Eagle founded Edcomm with Clifford Brody. In 2010, a company bought Edcomm. Although the purchaser retained the three founders of Edcomm, they were ultimately terminated. Screen Shot 2013-03-07 at 9.23.47 AM.jpg The present dispute focuses on Edcomm’s use of Eagle’s LinkedIn account following her termination.

The court discusses, in some detail, Edcomm’s approaches to LinkedIn accounts. During Eagle’s tenure, the company encouraged the creation and use of LinkedIn accounts. Interestingly, although the executives were aware of and discussed the ownership issues surrounding use of these accounts, Edcomm did not adopt any policy that would advise employees that LinkedIn accounts were the property of Edcomm. [The court cites to a fascinating email exchange where the principals debate the merits of the ownership arguments, and whether the company policy that it would own all data on company hardware would adequately resolve the issue of account ownership (answer: no).]

Interestingly, Eagle provided her LinkedIn password to other Edcomm employees who assisted with responding to invitation requests and maintaining the account. This came back to haunt her, as the employees who remained with the company following Eagle’s termination continued to use the account and locked her out of it. Edcomm (sans Eagle) had control of the account between June 20, 2011 (the date of Eagle’s termination) and July 6, 2011. LinkedIn then took control of the account, presumably at Eagle’s request, and she regained control of the account by July 14, 2011.

During the time period when Edcomm used the account following Eagle’s termination, it did not overtly state via the LinkedIn account that Eagle was no longer with the company. However, Edcomm swapped out the bulk of Eagle’s information for the details of Sandi Morgan, the interim CEO of Edcomm. Eagle’s custom URL remained, and the profile was accessible “via linkedin.com/in/lindaeagle.” Therefore, people who were looking for "Linda Eagle" via LinkedIn (or perhaps even a search engine) would be directed to Eagle's account which now contained largely Morgan's information.

Unauthorized use of name under 42 Pa. C.S. 8316: The court says that Eagle adequately states a claim under the Pennsylvania statute that protects a person’s commercial interest in their name or likeness. The court says that Eagle's name clearly has commercial value, given that she has wide acclaim and appears to be a thought leader in the space. The court also says that Edcomm “used” her name:

[a]n individual conducting a search . . . for Dr. Eagle . . . by typing in “Linda Eagle,” would be directed to a URL for a web page showing Sandi Morgans name, profile and affiliation with Edcomm Group Banker’s Academy. In other words, by looking for Dr. Eagle, an individual would unwaringly be put in contact with Edcomm despite the fact that Dr. Eagle was no longer affiliated with Edcomm and did not consent to Edcomm’s use of her name.

[emphasis added]

Invasion of privacy/misappropriation of identity and misappropriation of publicity: The court largely relies on similar reasoning to find that Eagle adequately states a claim for invasion of privacy by “misappropriation of identity” and for misappropriation of publicity:

[the search results] clearly provided promotional benefit for Edcomm and constitutes misappropriation of [Eagle's] name for commercial use.

Identity theft: Identify theft under the Pennsylvania statute requires “possession or use [of] identifying information or another person . . . to further any unlawful purpose.” The court says that Edcomm only used information that was publicly available. Interestingly, the court does not discuss whether use of the password constitutes identity theft. Also, the court points out that the “honors and awards” portion of Eagle’s LinkedIn page could not be identifying information. In the process, the court states:

in all logic, a person directed to [Dr. Eagle’s page] could not reasonably believe that the page was intended to identify Dr. Eagle. Rather, a reasonable individual, while perhaps confused as to how he or she arrived at this page, would have no doubt that the page belonged to Ms. Morgan and was describing Ms. Morgan’s resume.

[Every now and then I come across language that seems like it’s judicially trolling Professor Goldman. This is a prime example of this.]

Conversion: The court says that the tort of conversion is somewhat limited under Pennsylvania law when it comes to intangible property. While other courts have held that things like domain names (and even Twitter accounts) can be converted, the court says that under Pennsylvania law conversion is only available where the intangible rights are “customarily merged in, or identified with, a particular document (for example, a deed or a stock certificate).” This is not the case here. (Again, the court does not discuss the possibility of the password being converted.)

Interference with contract: The court says that Eagle has established the elements of interference with contract (the contract between her and LinkedIn). The only problem is that she fails to satisfy the element of damages. In discussing this cause of action, the court also notes that the agreement was between her in her individual capacity and LinkedIn, and not between Edcomm and LinkedIn.

Damages: After finding that Eagle adequately proved the bulk of her existing causes of action, the court concludes that she has not proven her entitlement to compensatory damages. First, the court says that she has not established damages with reasonable certainty. She relied on an interesting formula that apportioned the total (historical) revenue she generated across her LinkedIn accounts, and like the parties in the Twitter account case, came up with a per month per “connection” damage figure. However, the court says that she falls short in failing to show that she actually generated the revenues through her contacts:

Aside from her own self-serving testimony that she regularly maintained business through LinkedIn, Plaintiff failed to point to one contract, one client, one prospect, or one deal that could have been, but was not obtained during the period she did not have full access to her LinkedIn account. Indeed, the very real possibility exists that even with full access to her LinkedIn account, she would have not made any deals with any of her contacts during the time period in question.

The court says that she fails to show a reasonably fair basis for calculating her damages. She did not retain an expert, and only presented the testimony of her co-founder Clifford Brody. He admitted to “guestimating” on the damages, and more importantly “failed to connect Dr. Eagle’s successful sales with any use of LinkedIn . . . “

The court also declines to award punitive damages, saying that it was just as reasonable to conclude that Edcomm was acting to protect its property (or what it perceived as its property) rather than acting to harm plaintiff. On this basis, the court says Eagle fails to satisfy her burden on entitlement to punitives.

Edcomm’s counterclaims: The court also rejects Edcomm’s counterclaims.

First, it argued that Eagle committed misappropriation when she continued to use her account. The court says no:

Edcomm never had a policy of requiring that its employees use LinkedIn, did not dictate the precise contents of an employee's LinkedIn account, and did not pay for its employees' LinkedIn accounts. Indeed, as noted above, the LinkedIn User Agreement expressly states that Plaintiff's account is between LinkedIn and the individual user. Edcomm did not itself maintain any separate account. Moreover, Edcomm failed to put forth any evidence that Eagle's contacts list was developed and built through the investment of Edcomm time and money as opposed to Eagle's own time, money, and extensive past experience . . . .

The court also rejects its unfair competition claim, saying that apart from misappropriation (that the court rejects) Edcomm does not identify any other basis for how she unlawfully or improperly competed by using the LinkedIn account.

This is a pretty interesting end to a wide-ranging dispute that spanned several lawsuits and jurisdictions.

There is so much to take away from this dispute:

- it’s a demonstration again of the difficulty of slotting things like LinkedIn accounts into existing regimes of intellectual property.

- It’s also a good illustration of how helpful an employer's social media policy can be, although policies may not always resolve the issues.

- Personality rights and trademarks are a good hook for plaintiffs, and continuing to use the name of an ex-employee (if you are a company) or mark of a company (if you are a contractor) in an account can be risky, absent contractual authorization.

- Possession of the password is important, and password-sharing is risky activity, no matter what the context.

- Would social media password legislation have resulted in a different resolution? Tough to say, although Edcomm would likely have been reluctant to ask for and use the password post-termination.

- As Eric mentions below, identify theft statutes can be broadly worded. The court correctly rejects plaintiff's argument in this case that Edcomm violated the statute, but I expect plaintiffs will continue to rely on this argument.

I’m curious about two things factually that the court does not delve into. First, how easy would it have been for Edcomm to have changed the vanity URL? Second, I’m curious about the process through which Eagle regained control of her account.

The court’s finding that Eagle adequately asserted a publicity rights claim is interesting in that it relies on the fact that end users would be routed to her account while searching for her. On the one hand, the court says that users will be "unwaringly" directed to her profile, but on the other hand, the court says that there’s no way users will be confused, since Edcomm replaced the bulk of Eagle’s account details. The court does not cite to the recent Wisconsin decision involving keyword ads and personal names (nor does it discuss the Stayart case). The Wisconsin case is slightly distinguishable since there the name was an invisible trigger (and deals with Wisconsin’s statute, which probably differs from Pennsylvania’s), but still somewhat analogous I thought. The court could have just found that she did not state a claim to begin with, but perhaps took the “no damages” route as this rationale would better insulate the court’s decision against appellate review. Either way, the court’s ruling shows the broad reach of personality and publicity type statutes and claims and their possible applicability to these types of disputes. (See also Maremont v. Fredman Design Group.)

Above all, perhaps it's a good illustration of the fact that these lawsuits may not be worth it from an economic standpoint. The extent to which Eagle overstated the economic importance of her LinkedIn account was also interesting, almost bizarre. There is some value in being able to get in touch with someone and for a person to advise their network on what is going on with them professionally, but the likelihood of actually depending on LinkedIn and using it to generate revenue seems like a stretch to me. In any event, the court was not sold, based on the available evidence, that this was the case for Eagle's account. It's worth mentioning again that the account was under Edcomm's control for a relatively short period of time, and this could have driven the ruling on damages. It's possible the outcome may have been different if it took over and continued to use the account.

A final follow-up thought. In the old days, non-competes were a classic term that should be addressed by the parties in the context of any acquisition. I would probably add treatment of social media assets and accounts to this. I wonder if the acquisition agreement contained a non-compete agreement. I'm guessing the answer is no, given that the court did not mention it.
____

Eric's Comments

Although I have some quibbles, overall I think Judge Buckwalter did a commendable job with this case. Having recently raised some questions about a prior ruling of his, I thought he deserved props for his navigation of the issues.

Some highlights from the case:

1) One of the most shocking things I read in a judicial opinion recently: "As the CEO at the time, Brody found that "LinkedIn was awesome" for marketing, and he testified enthusiastically about it." Holy cow, someone actually found a good use for LinkedIn!!! Just kidding, I actually find LinkedIn quite useful in a number of contexts, and I certainly like it better than Facebook.

2) David Shapp, the company's senior vice president, tried to play junior lawyer and failed miserably--twice! Shapp first took the position that the company owned Eagle's LinkedIn account because it "owns all data on its hardware, including email archives." This isn't true, and it's factually inapplicable as LinkedIn is a pure cloud-based server. When Brody noted the latter point, Shapp then argued a former employee "cannot use [the LinkedIn] account because she does not own the email address that opened it." Also not true legally or factually. These kinds of mistakes are common when folks play junior lawyer. However, Shapp was closer to the truth when he says that the company can use a former employee's LinkedIn account so long as "we do not pretend to be her." Which is exactly what Edcomm did with Eagle's account when it edited the profile with Morgan's data. Whoops.

3) The judge says "the LinkedIn User Agreement clearly indicated that the individual user owned the account." In support of this, the judge cites the following language: "If you are using LinkedIn on behalf of a company or other legal entity, you are nevertheless individually bound by this Agreement even if your company has a separate agreement with us." Am I missing something? I don't see this language as saying the employee owns the account. I see it as LinkedIn trying to hold both the employee individually and the company accountable for any misuse.

4) I was pleased to see the judge reject the identity theft claim. We've previously complained about overexpansive interpretations of identity theft laws (see, e.g., Rolando S and State v. Madrigal) but the court steers clear of the pitfalls. However, the case turns on the legitimacy of Edcomm's possession of the LinkedIn log-in credentials--a potentially perennial issue under California's restriction of employers' ability to ask for employee log-in credentials.

5) I was also pleased to see the judge reject the conversion claim. We've seen other judges misunderstand the interplay between conversion, IP protection and chattels vs. intangibles, but Judge Buckwalter nails it.

6) Although the opinion doesn't say this so expressly, the opinion implicitly concludes that Dr. Eagle's LinkedIn profile is advertising for publicity rights purposes, such as that misusing the profile constitutes a commercial use of her personality. This gets into some sticky areas. For example, some state bars are taking the position that a lawyer's profile on LinkedIn is attorney advertising. If so, then the new LinkedIn feature allowing for "endorsements" of a person's "skills and expertise" could constitute unlawful attorney advertising (see this discussion from South Carolina). It's not automatic that a finding that a LinkedIn profile is advertising for publicity rights purposes means that it will be advertising under other legal doctrines, but still, that issue isn't going away any time soon.

7) We've maintained all along that litigation battles over social media accounts are economically irrational. This case provides further support for that proposition. Here, Dr. Eagle makes a prima facie showing of a publicity rights violation and still gets nothing.
____

Added: a post from Jeffrey Gross, who represented Eagle in an earlier phase of the case "Court Rules That LinkedIn Account Belongs to Employee, and not Employer"

Previous posts on this case:

Battle Over LinkedIn Account Between Employer and Employee Largely Gutted--Eagle v. Morgan
Another Set of Parties Duel Over Social Media Contacts -- Eagle v. Sawabeh

Posts on other social media ownership cases:

Employer Fails to State Stored Communications Act Claims Absent Allegations That Employees Interfered With Company Accounts – Castle Megastore v. Wilson
Facebook Posts and Twitter Invites Don't Violate Non-Solicitation Clause -- Pre-Paid Legal v. Cahill
Employee/Ex-Employer Lawsuit Over Twitter Account Settles – Phonedog v. Kravitz
Court Denies Kravitz’s Motion to Dismiss PhoneDog’s Amended Claims -- PhoneDog v. Kravitz
An Update on PhoneDog v. Kravitz, the Employee Twitter Account Case
Employee's Claims Against Employer for Unauthorized Use of Social Media Accounts Move Forward--Maremont v. SF Design Group
Courts Says Employer's Lawsuit Against Ex-Employee Over Retention and Use of Twitter Account can Proceed--PhoneDog v. Kravitz
Ex-Employee Converted Social Media/Website Passwords by Keeping Them From Her Employer--Ardis Health v. Nankivell
Court Declines to Dismiss or Transfer Lawsuit Over @OMGFacts Twitter Account -- Deck v. Spartz, Inc.
Employee's Twitter and Facebook Impersonation Claims Against Employer Move Forward -- Maremont v. Fredman Design Group
MySpace Profile and Friends List May Be Trade Secrets (?)--Christou v. Beatport

Eric’s talk notes: "Social Media and Trademark Law"

Posted by Venkat at 12:30 PM | Publicity/Privacy Rights

February 28, 2013

Buying Keyword Ads on People's Names Doesn't Violate Their Publicity Rights--Habush v. Cannon (Forbes Cross-Post)

By Eric Goldman

Habush v. Cannon, 2013 WL 627251 (Wisc. App. Ct. Feb. 21, 2013)

Can you imagine someone buying Google ($GOOG) AdWords keyword advertising triggered by your name? Most of us wouldn't dream of it, usually because our names just aren’t valuable enough for anyone to bother. In contrast, some professional service providers, such as lawyers and doctors, tout their names in expensive advertising campaigns to consumers—and have competitors who would love to piggyback on that advertising to reach the same consumers. In a novel and persuasive ruling, a Wisconsin appellate court recent rejected a professional service provider’s attempt to use publicity rights to shut down a competitive keyword advertiser.

Case Background

The case involves two high-profile personal injury law firms in Wisconsin. The defendant, Cannon & Dunphy, bought keyword advertising on the words “Habush” and “Rottier,” presumably referring to the partners at its rival law firm Habush, Habush & Rottier. As a result, searchers looking for the law firm Habush Habush & Rottier or its eponymous partners might see ads for Cannon & Dunphy.

Normally, a lawsuit like this would be brought under trademark law. Lawyers can develop trademark rights in their name, and the firm name Habush Habush & Rottier should be a trademark. However, it’s less clear if the individual partner names have achieved trademark protection, or if any trademark protection would extend to the use of just their last names.

Either way, Habush and Rottier chose to sue under Wisconsin's publicity rights law instead of trademark law. Publicity rights law protect a person’s name, image and other attributes from commercial use. The most obvious example is a commercial endorsement. An advertiser can’t use a person’s name or face in their advertising without permission.

Habush and Rottier sued Cannon & Dunphy (and some of its individual partners) in late 2009. In June 2011, the trial court rejected the claim in a messy opinion where the judge appeared overwhelmed by the case's legal and technological complexity. Because two very successful and determined litigation firms were squaring off, the judge also knew that the losing side would appeal no matter what.

In June 2012, the Wisconsin appellate court first addressed the case. In an odd ruling, the panel certified the case to the Wisconsin Supreme Court--basically, punting the case upstairs. In September 2012, the Supreme Court denied certification, effectively telling the appeals court to try again. The Wisconsin appeals court has now issued a ruling that sets up the inevitable appeal to the Wisconsin Supreme Court.

The Ruling

Interpreting the Wisconsin publicity rights statute, the court said the keyword advertiser didn’t make an actionable “use” of the names Habush or Rottier by using the names as “invisible” ad triggers. The court analogized the defendants’ keyword advertising to buying a physical-space billboard physically adjacent to the plaintiff’s offices, saying that such proximity would not constitute a “use” of the plaintiff’s personality. While normally I am troubled by physical-space analogies to online activity, I thoroughly explored—and defended—this analogy in my Brand Spillovers paper, sadly (for me) not cited by the court. Thus, because the plaintiffs failed to establish the statutory violation, Cannon & Dunphy wins.

In contrast, if the ad copy had displayed the name, this court probably would treat that as a publicity rights “use” and the defendant would have to find other grounds to defeat the lawsuit. The court also indicates that invisible uses in contexts other than keyword advertising could constitute a publicity rights “use.”

The plaintiffs correctly argued that the court’s conclusion on publicity rights “use” diverges from trademark law’s treatment of the issue. Most courts have held that buying keyword ads on a trademark constitute trademark “use” even if the trademark doesn’t appear in the ad copy, with the Second Circuit’s 2009 Rescuecom decision basically cementing that legal conclusion. (In my Deregulating Relevancy and Online Word of Mouth papers, I argued why disposing of keyword advertising cases on trademark use grounds would be a better result, but those arguments haven't carried the day). The Wisconsin appeals court says simply that the Wisconsin publicity rights statute means something different by the word “use” than trademark law does, so Rescuecom and related trademark precedents aren’t binding.

[Note: unlike Google's detailed trademark policy, Google's policy towards personal names is murky. It says in total: "We do not monitor the use of proper names in AdWords ads or keywords. Users interested in removing an advertiser's use of proper names in ads should contact our Consumer Complaints team via our complaint form."]

Implications

This is an interesting case in part due to its novelty. We’ve seen other plaintiffs unsuccessfully attempt to use the Wisconsin publicity rights statute to control Internet advertising (most obviously, the repeat litigant Bev Stayart), but this case provides the cleanest opinion to squarely address a publicity rights challenge to keyword advertising.

Three implications of this ruling:

Keyword Advertising Lawsuits Aren’t Economically Rational. These lawyers are spending a lot of time and money fighting each other in court. I hate to repeat myself, but keyword advertising lawsuits aren’t economically justified, even if the plaintiff wins. See this recap post. Then again, given how well these firms—and lawyers—know each other and how fiercely they compete, I doubt the plaintiffs brought this lawsuit solely to maximize their profits.

Keyword Advertising and Competition. The trial court opinion in this case expressly acknowledged the competitive concerns associated with keyword advertising. It’s easy to see why. Imagine an injured victim needs a personal injury lawyer and has seen Habush Habush & Rottier’s advertising. During the consumer's keyword search to find the firm, Cannon & Dunphy presents itself to the victim as a competitive alternative. This encourages the victim to investigate multiple law firms, and those firms will work harder to meet the victim’s legal needs. This is a win for the consumer, and a win for competition. The appellate court expressly sidestepped these public policy issues, but its ruling nicely advances those interests.

Why a Plaintiff Win Could Be Disastrous. I read a lot of crackpot lawsuits, often pro se, basically complaining that someone published the plaintiff’s name online (one recent example). Can you imagine what would happen if those plaintiffs can claim that any keyword advertising triggered on their last names violated their publicity rights?

Take my last name for example, Goldman. There are plenty of other Goldmans in the world, most obviously the big investment bank Goldman Sachs. How would we determine if a keyword advertiser on the word “Goldman” was advertising to compete with Goldman Sachs or violating my publicity rights? We might impose some requirement of direct competition to distinguish the Habush situation from the Eric Goldman situation, but that competitive limitation isn’t in the Wisconsin publicity rights statute, and it won’t always be easy to decide who “competes” with me.

So even if you feel some mild sympathy towards Habush Habush & Rottier because its rival is engaging in ambush marketing, recognize that subsequent publicity rights plaintiffs won’t look so sympathetic.

[Photo credit: Portrait of an invisible Man with sunglasses in business suit // ShutterStock]

Posted by Eric at 08:52 AM | Marketing , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

February 26, 2013

Lindsay Lohan Loses Publicity Rights Claim Against Pitbull Over Song Lyrics--Lohan v. Perez

By Jake McGowan [writings][LinkedIn]

Lohan v. Perez, No. 11-CV-5413 (E.D.N.Y. 2013)

Lindsay Lohan just can’t catch a break.

In 2007, after a string of unsuccessful movies and a long battle with substance abuse, Lohan found herself on probation for two drunk driving incidents. Since then she has had multiple stints in rehab, probation violations, and other legal trouble stemming from a necklace theft. Unfortunately for Ms. Lohan, it now seems she is equally unsuccessful as a plaintiff.

The former child star recently brought a publicity rights lawsuit under New York law against Miami rapper Pitbull and R&B singer Ne-Yo, along with others responsible for mentioning her name in the hit song “Give Me Everything.”

On February 21, a district court in New York dismissed the complaint and even sanctioned Lohan's attorney.

Background

The song in controversy is Pitbull’s "Give Me Everything," featuring Ne-Yo, Afrojack, and Nayer. The lyrics referencing Ms. Lohan appear about a minute into the song:

“So I'm tiptoein’ to keep blowin’/ I got it locked up, like Lindsay Lohan.”

(note: if you ever struggle in deciphering certain rap lyrics, check out the helpful and hilarious site RapGenius.com)

According to Lohan’s complaint, this subtle jab damaged her because at all relevant times, she was “a professional actor of good repute and standing in the Screen Actors Guild” (sarcastic emphasis added). She alleged that the defendants violated Sections 50 and 51 of the New York Civil Rights Law, and she also brought claims for unjust enrichment and intentional infliction of emotional distress (IIED).

Lohan’s Claim Fails to Satisfy the New York Civil Rights Law Requirements

New York does not have a common-law right of privacy, so Lohan’s only option was to try for the limited statutory protection under Sections 50 and 51 of the New York Civil Rights Law. Under Section 50, it is a misdemeanor for a person to “use[ ] for advertising purposes, or for the purposes of trade, the name, portrait or picture of any living person without having first obtained the written consent of such person."

In this case, the court found a few glaring problems with Lohan’s complaint:

(1) the First Amendment protects the song as a work of artistic expression; and
(2) Lohan’s name was not used in the song “for advertising purposes, or for the purposes of trade.”

The court referenced the 2002 New York case Hoepker v. Kruger, agreeing that the First Amendment presents a complete defense:

"'pure First Amendment speech in the form of artistic expression . . . deserves full protection, even against [another individual’s] statutorily-protected privacy interests.’”

Because music is considered artistic expression, Pitbull’s use of Lohan’s name is protected as part of “Give Me Everything,” the veritable work of art. Also, the name-dropping is so simple and isolated that the court refuses to believe that it was meant for purposes of advertisement or trade.

Lohan’s Unjust Enrichment and IIED Claims Also Fail

The court dispatched Lohan’s unjust enrichment claim quickly, suggesting that she was trying to invent a non-existent common law claim by merely recasting the statutory claim under the New York Civil Rights Law.

The IIED claim shared a similar fate:

Accepting plaintiff’s allegations as true . . . even if defendants used plaintiff’s name in one line of the Song without her consent, such conduct is insufficient to meet the threshold for extreme and outrageous conduct necessary to sustain a claim for [IIED].

______________

This is not the first time Lohan has used the legal system to vindicate her publicity rights. In 2010, she brought a similar claim against E-Trade Bank for its Super Bowl ad referencing "that milkaholic Lindsay." In that case, she asked for $100 million. It's rumored she made some money when it settled out of court.

With that in mind, it seems pretty clear that Lohan and her attorneys thought they could go back to the well with a weak lawsuit. This time, however, the meritless claims actually came back to bite Lohan's attorney.

In a strange turn of events, the court fined Lohan’s attorney Stephanie Ovadia $750--not for filing frivolous claims, but because she plagiarized “a vast majority of the Opposition . . . from other sources without any acknowledgment or identification[.]"

On the other hand, the court also took issue with defendants' counsel sitting on this information:

The Court also notes, parenthetically, that it is underwhelmed by the nature of defendants’ counsel’s conduct upon learning of plaintiff’s counsel’s plagiarism. Defendants’ counsel recognized the existence and extent of the plagiarism as early as March 9, 2012 . . . Defendants’ counsel certainly had the option of raising the issue with plaintiff’s counsel, thereby affording plaintiff’s counsel the opportunity to withdraw the Opposition and request leave from the Court to amend the opposition papers. Instead, the first time defendants’ counsel raised the issue was when they filed the fully-briefed motion to dismiss and highlighted the plagiarism as part of the reply papers.

As Marty Schwimmer points out on his blog, this raises the interesting question of whether the defendants' counsel has a duty to warn its opponent, or whether they can let their adversary shoot themselves in the foot.

Either way, it looks like the drafting was as weak as the purported basis for the complaint. These claims never stood much of a chance.

[Photo Credit: Anthony Mooney / Shutterstock.com]

Posted by JakeMcGowan at 08:30 AM | Marketing , Publicity/Privacy Rights | TrackBack

January 31, 2013

Another Employee Behaves Badly on Social Media. Really, You “Can’t Make This Up.” -- In re Palleschi

[Post by Venkat Balasubramani with a comment from Eric]

Palleschi v. Cassano, 2013 WL 322573 (N.Y. App. Div. Jan. 29, 2013). The trial court decision.

Someone calls 911 complaining of a “gynecological emergency.” A fire dept. employee, an emergency medical services supervisor, photographs the computer screen, including the complaint, along with the caller’s name, address, and telephone number. The employee uploads the image to his Facebook account with the following caption:

[c]an't make this up.

Not surprisingly, the ALJ and judge don't find his post very funny.

What you “can’t make up” is the human ingenuity and creativity when it comes to posting stuff that comes back to haunt you . . . and then complaining about it. I’m surprised the reaction of the ALJ was a one sentence denial of the claim that said only “you can’t make this up.”
____

Eric's Comment: I'm not sure how professionals in the healthcare industry interpret their confidentiality obligations, but sharing the screenshot with even one person seems like a fairly blatant violation--and sharing the screen with hundreds of folks online only magnifies the gaffe's scope. I put this incident in the same social-media-misjudgment bucket as Tatro (funeral industry), Yoder (nursing), Byrnes (nursing), CareFlite (EMT) and O'Brien (teacher). It seems like all professional schools need to be teaching their students about the proper use of social media. Apparently that's not self-evident.

[image credit: Shutterstock / Kalmatsuy Tayana -- "birthday clown holding blank board"]

Posted by Venkat at 12:46 PM | Content Regulation , Evidence/Discovery , Publicity/Privacy Rights

January 11, 2013

Virginia Supreme Court: Litigant Who “Cleans up” His Facebook Page May Be Sanctioned

[Post by Venkat Balasubramani]

Allied Concrete v. Lester, 2013 Va. LEXIS 8 (Jan. 10, 2013)

This case generated some attention at the trial court phase, but for whatever reason I didn’t have a chance to blog it.

Lester and his wife were driving on the highway and were struck by a loaded concrete truck operated by Sprouse, an employee of Allied Concrete. Lester’s wife ultimately died from the injuries she suffered, and Lester sued on his own behalf and on behalf of her estate. party pic.jpg After a three day trial, the jury awarded approximately $11 million dollars ($6.2mm on the wrongful death action; $2.3mm on his own personal injury claims; and $1mm to Jessica’s parents).

During trial, Lester sent a Facebook message to an attorney for Allied Concrete [???]. As a result, Allied was able to access Lester’s Facebook page, including a photo depicting Lester holding a can of beer and wearing a t-shirt emblazoned with “I [#x2764] hot moms”. Allied promptly sent out discovery requests seeking the contents of Lester's Facebook page. What happened next was almost comical. Murray, Lester’s lawyer, instructed his paralegal to tell Lester to “clean up” his Facebook page:

[he didn’t] want any blow-ups of this stuff at trial.

Smith followed her boss’s instructions, and told Lester in an email to “please clean up [his] facebook and myspace!”

Lester complied, and informed his lawyer that he had deleted his Facebook page. Accordingly, Lester and his lawyer got cute and responded to Allied’s discovery requests, saying that Lester did not have a Facebook page 'at the time he signed the discovery responses'. Of course, Allied had already seen a copy of Lester’s Facebook page, so it filed a motion to compel, which prompted Lester to reactivate his Facebook page and produce much of the information sought by Allied. Lester nevertheless deleted a bunch of photos from the page.

To make matters worse, in deposition, Lester denied that he ever deleted (or deactivated) his Facebook page. Allied ended up subpoenaing Facebook for this information and hiring an expert to determine that Lester had deleted photos. The photos were eventually provided to Allied.

The trial court sanctioned Lester’s lawyer in the amount of $542,000 and hit Lester with $180,000 to cover Allied’s attorney’s fees and costs in addressing the Facebook deletion issue. In addition, the court accepted an adverse inference jury instruction which was read twice to the jury (i.e., Lester deleted photographs from his FB account; one of these could not be recovered and it should be presumed to be harmful).

On appeal, Allied said it was entitled to a new trial because the trial was tainted by Lester’s dishonesty and by his lawyer’s conduct. The appeals court disagreed, saying that the trial court detailed the many instances of misconduct committed by either Lester or his lawyer as well as the steps the court took to address each instance of misconduct. Additionally, the trial court allowed an adverse inference instruction. Finally, and probably most importantly, the misconduct only resulted in the initial unavailability of evidence that Allied was ultimately allowed to present at the trial. Allied was not prejudiced in the sense that it had all the relevant evidence available even if it had to jump through a bunch of extra hoops to get it.

The trial court ended up reducing a big chunk of the wrongful death award, but for reasons that aren't relevant to the discovery issues. The Virginia Supreme Court found that this was an abuse of discretion and reinstated the full amount of the award. Separately, Allied also complained that one of the jurors was not totally forthcoming about her contacts with Lester’s counsel, but the court concluded that the contact which occurred prior to the case was incidental and did not undermine the juror’s response about not knowing any of the lawyers in the case.

Ouch.

It’s tempting for litigants and their lawyers to want to “clean up” their social media accounts, or even change the settings to an account, but as this case shows, this course of action is fraught with danger at best. I don’t know the answer to whether a change of setting would be considered a material alteration of an account. I assume the answer is no. Either way, the entire endeavor was handled rather casually in this case.

Here, the lawyer (through a paralegal) directed a party to “clean up” their account. The party complied, but then was not forthcoming about it in deposition. The cover-up is worse than the crime, as they say. The email exchanges between Lester and his legal team (that were obtained by Allied and cited by the court) were cringe-worthy. (Again, entirely understandable, but cringe-worthy nonetheless.)

Although the Facebook spoliation issue didn’t upset Lester’s case, it ended up costing him and his lawyer a pretty penny.

This case is a good reminder of something we’ve flagged before: when you delete your Facebook account, you’re not really deleting it. The underlying material is still available for an opposing party to try to obtain.

Previous posts:

"A Dark Side of Data Portability: Litigators Love It"
"Court Orders Password Turnover and In Camera Review of Social Media Accounts – EEOC v. Original Honeybaked Ham Co."
"Social Media Discovery Case Update and Tips for Those Seeking Discovery"
"Social Media Discovery Roundup"
"Court Orders Production of Five Years' Worth of Facebook and MySpace Posts – Thompson v. Autoliv"
"Court Orders Disclosure of Facebook and MySpace Passwords in Personal Injury Case -- McMillen v. Hummingbird Speedway"
"Judge Offers to Facebook 'Friend' Witnesses in Order to Resolve Discovery Dispute -- Barnes v. CUS Nashville"
"Facebook Messages/Wall Posts, Civil Discovery, and the Stored Communications Act -- Crispin v. Audigier"
"Plaintiff Can't be Forced to Accept Defense Counsel's Facebook Friend Request in Personal Injury Case -- Piccolo v. Paterson"
"Court Orders Plaintiff to Turn Over Facebook and MySpace Passwords in Discovery Dispute -- Zimmerman v. Weis Markets, Inc."

[image credit: Kzenon/Shutterstock ("Young people in club or bar drinking cocktails and having fun")]

Posted by Venkat at 08:09 AM | Evidence/Discovery , Publicity/Privacy Rights

Top Ten Internet Law Developments of 2012 (Forbes Cross-Post)

By Eric Goldman

I'm pleased to share my list of top 10 developments of 2012:

#10: The Push Towards Anti-Class Action Arbitration Clauses. In 2011, the U.S. Supreme Court ruled in AT&T Mobility v. Concepcion that businesses may be able to adopt mandatory arbitration clauses that ban customer class-action lawsuits. The ruling was hardly crystal-clear, but in its wake, many websites adopted such clauses. Nevertheless, as the Zappos decision points out, these clauses must be adopted according to the laws governing contract formation and amendment, or they will fail in court.

#9: General Patraeus/Paula Broadwell Imbroglio. On the surface, it's just your typical Washington DC sex scandal. However, it had several interesting cyberlaw angles, including the attempts to hide digital conversations and Ms. Broadwell's alleged cyberharassment of Jill Kelley. My biggest takeaway: If the CIA Director can't keep the FBI from reading his email, what chance do you or I have?

#8: Do-Not-Track Meltdown. Everyone hoped that industry would come up with a do-not-track (DNT) standard rather than kicking the issue to Congress or the FTC. Then, it all went to heck. Microsoft announced it would turn on DNT by default in its browser, which prompted Internet publishers to threaten to ignore Microsoft's DNT signal. Meanwhile, Internet publishers and others adopted a narrow definition of "do-not-track," arguing it meant no-tracking for advertising purposes, but tracking for other purposes was still OK. The effort then devolved into acrimonious recriminations and left open the possibility that government regulators will fill the gap--to everyone's detriment. (For what it's worth, I take a very dim view of technological do-not-track efforts for reasons I explain here).

#7: Social Media Exceptionalism. In 2012, regulators eagerly sought to "fix" social media through regulation, but their efforts will fail because no one can precisely define social media as a subset of Internet activity. For example, California's recent attempt to curb employers' attempts to obtain employees' social media passwords led to the astounding definition that "social media" means all digital data, whether online or off.

#6: Megaupload. The US government proudly touted its takedown of Megaupload as a victory for Internet copyright enforcement. Unfortunately, it appears that takedown involved an enforcement action where it appears the US government repeatedly ignored or broke the law.

#5: Software Patents/Smartphone Wars. The smartphone industry has ushered in a glorious era of innovation, but it's also highlighted how patents can hinder, not spur, innovation. Smartphone players have spent (wasted?) billions of dollars on patents with the hope that they can operate without restriction from other players' patents, and many tens of millions of dollars have been spent (wasted?) on legal fees as the players sue each other for patent infringement and defend against interlopers with weak/bogus patents hoping for a little taste of the action. See my essay on software patents:

#4: Europe Hates Silicon Valley. I'm surprised whenever I read about a new European ruling that's adverse to a Silicon Valley company, because at this point I assume that everything Silicon Valley companies do in Europe is already illegal. Google, Facebook and other Silicon Valley players are under constant legal attack in Europe on countless fronts. Everyone might be happier if the Silicon Valley players just got out of Europe altogether.

#3: Google and Antitrust. The FTC largely dropped its antitrust investigation against Google, and dropped it completely with respect to Google's search engine practices. (Technically the denouement rolled out on January 3, 2013, but I'm still counting it as a 2012 development). This is an important development for several reasons. First, the FTC--which makes its living by bringing enforcement actions--admitted it had no reason to complain about Google's search engine practices. Second, the scuttlebutt all throughout the investigated suggested that the FTC was committed to busting Google, and Google turned that situation around 180 degrees. Third, not intervening into the operation of Google's search algorithm is a logical decision, but one still worth celebrating. This was a great resolution for Google, a complete rejection of the concerns raised by Microsoft and other Google-haters, and due to the FTC's non-involvement, ultimately a big win for Google's users.

#2: ITU/WCIT's Attempted Internet Takeover. I really didn't understand what happened in Dubai at the ITU/WCIT meeting. All I know is that nothing good could have happened there, so preserving the status quo is a win, as ironic as that sounds.

However, there has been some teeth-gnashing that the meeting exposed looming fault lines between pro-censorship and anti-censorship governments. I don't understand that angst for at least two reasons. First, all governments are pro-censorship, and that certainly includes the United States. Indeed, the US has exhibited some awkward duality as it rails against foreign attempts to censor the Internet even as both Congress and the Obama Administration exhibit a never-ending pursuit of controlling the Internet themselves.

Second, the Internet has already fractured into multiple "Internets." The Internet in the United States increasingly bears little resemblance to the Internet in foreign countries, both because local regulators simply block certain websites and because websites localize their services to accommodate local regulation. Plus, it's been proven that countries can simply "unplug" from the Internet. Thus, we don't have a single unified Internet; we have many partially-overlapping Internets. I will say more about this in a future post.

#1: SOPA's Failure. The failure of SOPA/PIPA is not the watershed event for our republican democracy that we wished it would be. Citizen-driven rejection of special-interest Internet legislation will not happen very often. But as a David-and-Goliath story--the uncoordinated and oft-ignored Internet user community rising up against a well-oiled and undefeated copyright lobby--it doesn't get any bigger than SOPA. Also, we learned something really important: American voters will acquiesce to a lot of bad and self-interested decisions by their elected officials, but voters will grab the torches and pitchforks if they think the Internet is threatened.

Honorable Mentions

Some other developments of note:

* despite the Fourth Circuit's rekindling of the Rosetta Stone case before it settled, the decade-long keyword advertising litigation battles against Google are basically over with a big win for Google and other keyword advertising vendors. I also think we'll see trademark owner-vs-advertiser lawsuits tapering off too.

* app cloning is a big business, and we're seeing increasing lawsuits in the area, including the EA v. Zynga and TripleTown cases.

* the application of the Computer Fraud & Abuse Act is being dialed back in the employment context (see the Nosal and WEC cases).

* Oracle v. Google gave us one of the cleanest rulings to date that software APIs are not copyrightable. The case was also interesting for the judge's investigation into the paid advocacy efforts of both Oracle and Google.

* the images of Marilyn Monroe and Albert Einstein are moving closer to the public domain.

* the IB v. Facebook ruling could be a watershed decision in spurring class action lawyers to make a buck in the name of "protecting the kids" in court.

* Web publishers can improve their defamation defenses by hyperlinking to original sources.

Most Interesting Cases

I read a lot of cases in 2012, and some of the most interesting cases I saw this year:

* Erickson v. Blake. Music composers can create copyrightable compositions by equating the digits of the number "pi" (π) to musical notes, but they can't stop others from creating their own musical compositions based on pi's digits.

* Bland v. Roberts. Two government employees "liked" their boss' opponent in an upcoming election; after the boss won reelection, the employees allegedly got fired for their divided loyalties. The court (mistakenly, in my opinion) said that "liking" an item on Facebook isn't constitutionally protected speech.

* Scott v. WorldStarHipHop. A classmate posted a video of Scott fighting with an ex-girlfriend. Scott obtained the copyright to the video from his classmate and, as the new copyright owner, sent copyright takedown notices in an effort to scrub the video from the Internet. This copyright acquisition scheme basically converts copyright law into a "right to forget." In 2013, expect to see even more plaintiffs acquire copyright ownership as a way to suppress/control unflattering content about them.

* In re Heartland Payment Systems. This is a settlement of a data security breach class action lawsuit with 130M class members. The parties spent $1.5M to encourage class members to tender damage claims and another $270k to process the tendered claims. A total of 290 claims were tendered, of which 11 were valid, with a maximum payout per valid claim of $175. So the parties incurred $1.75M in transaction costs to award about $2k in damages. Interesting.

* Augstein v. Leslie. If you post a YouTube video promising $1M for the return of your laptop, you could actually owe $1M if someone returns your laptop.

* Olson v. LaBrie. Facebook should bring families closer together, but in one family, photo tagging plus a snarky comment prompted a lawsuit for a restraining order.

Lists from Previous Years

Previous top 10 lists from 2011, 2010, 2009, 2008, 2007 and 2006. Before that, John Ottaviani and I put together a list of top Internet IP cases for 2005, 2004 and 2003.

[Photo Credit: Top Ten Key // ShutterStock]

Posted by Eric at 07:25 AM | Content Regulation , Copyright , Derivative Liability , E-Commerce , Internet History , Licensing/Contracts , Marketing , Patents , Privacy/Security , Publicity/Privacy Rights , Search Engines , Trademark , Trespass to Chattels | TrackBack

January 08, 2013

Let's Stop Using the Term “Soft IP”

By Eric Goldman

You may have heard--or even used--the phrase “soft IP.” I'm not a fan of it, and I think we should retire the term.

The term "soft IP" is inherently ambiguous. Sometimes, people use "soft IP" to refer to “copyrights and trademarks;” other times, the term is intended to cover all IP other than patents--presumably publicity rights, trade secrets, etc. I especially cringe when I hear students tell me they are looking for a "soft IP" job. Typically, that's a reliable tipoff that the students don't know what kind of IP job they want; they just know they don't want to be (or aren't eligible to become) a patent prosecutor. That lack of clarity in the student's mind is rarely an asset to their job search.

I've had difficulty tracing the term's etymology. I searched several online databases looking for early uses and I found published references as far back as 1998, but my vague recollection (corroborated by others) is that the term goes back well before then.

As a term establishing a classification of IP, “soft IP” implies an antonym--presumably, “hard IP.” I don’t hear people use the term "hard IP," but given that soft IP always excludes patents, presumably patents are part of the antonym.

I can think of a few explanations for a hard/soft distinction among intellectual properties. First, patents often cover physical devices, so they often have a physical tangibility, while copyrights, trademarks and other IPs may be more intangible by comparison (even though patents protect "ideas," which is as intangible as they come).

Second, the hard/soft distinction might imply some difference in the degree of the practice's difficulty, i.e., the perception that patent law, and any associated technology, are complicated and “hard,” while other IPs are relatively easy and "soft" by comparison. People rarely articulate this relative value judgment explicitly, but I'm sure some patent practitioners believe that what they do is more challenging than the work of other IP practitioners; and I'm even more confident (because I've seen it repeatedly) that some patent practitioners feel comfortable "dabbling" in other IPs on the grounds that if they can do patents, they are well-qualified to handle other IPs.

It's true that patent prosecution requires passage of a separate bar exam, which in turn requires a technical background, so in that sense becoming a patent practitioner is "harder" than becoming an IP practitioner generally. Still, there is a certain implicit arrogance in this line of thinking.

Although I concede that patent law has plenty of arcane and baffling rules, I think patent practice is demonstrably not “harder” than other IP practices. I invite any patent practitioner--or, for that matter, any lawyer--who thinks that non-patent IP is "easy" to: walk me through 17 USC 114 (the music streaming provisions); calculate a pre-1976 copyright term duration; tell me what the term "use in commerce" means in trademark law; or walk me through the multitudinous ICANN procedures for objecting to or challenging gTLDs. And while historically the biggest bucks were in patent litigation, we're seeing big bucks across the IP spectrum, such as Oracle's $1.3B copyright damages award in the SAP case and Google's $100M+ defense costs in Viacom v. YouTube. (As I explain to my Internet Law class, $100M of legal fees is like the cost of *twenty* typical patent lawsuits!) And patent cases don't have a monopoly on hard technological questions; think about the technological sophistication to resolve Oracle v. Google, the Cablevision case or the Goforit case (just to pick three examples off the top of my head). Not only would it be condescending to say or imply that non-patent IP is "easy" or fluffy, I don't think it's remotely supportable factually.

A third hard/soft distinction is in the phrase “hard sciences,” although we rarely hear the antonym "soft sciences" (presumably social sciences). Because a technical background is required for patent prosecution, perhaps “hard IP” implicitly cross-references “hard sciences.” The thing is, there are several paths to qualify for the patent bar that don't require a “hard” science background, so that linkage would be odd.

In conclusion, I see at least three problems with the term “soft IP”:

1) It has at least two different definitions, making the term ambiguous.
2) It establishes an implicit hierarchy between different IP practices, which is potentially condescending and factually unsupportable.
3) It might imply an linkage with “hard sciences” that isn't necessarily true.

OK, so what should we use instead of the term "soft IP"? I don't have a great answer. The reality is that the IPs being lumped together under the "soft IP" appellation don't have enough commonalities to support the linkages--other than that they aren't patents. So we could use the term "non-patent IP" as the antonym to a patent practice. You probably like the term "non-patent IP" as much as I do (i.e., not much). My only other suggestion is to skip any effort to combine IPs in a single term and instead specify which IPs you are referring to. For example, if you're using "soft IP" to copyrights and trademarks, just say "copyrights and trademarks."

[I'm deliberately sidestepping the broader debate about the legitimacy of the term "IP"/"intellectual property," although I think that topic deserves additional discussion given some people's intrinsic absolutism towards "property" rights.]

Precise nomenclature is especially crucial for students in their job searches. If you aren't interested in a patent career, that's fine; but it's not a strong sales pitch to tell employers what you're *not* interested in, and the requirements and expectations of a trademark practice are quite different than a copyright practice (and different still from other IP niche practices). In reality, the best thing to students can do is to match their search criteria with the way employers structure the jobs. Few employers recruit for a "copyright" lawyer; typically, they are looking for a software licensing attorney or an entertainment attorney or an IP litigator knowledgeable in copyright law. My recommendation to students: figure out what employers are looking for, assess how the requirements of the job match against your skills and interests, and proceed accordingly. If you haven't gotten to the point where you can avoid the term "soft IP," your job search process probably still needs more cultivation, no matter how much effort you've invested in it to date.

[Photo credit: illustration depicting a sign post with directional arrows containing a choices concept // ShutterStock]

Posted by Eric at 08:51 AM | Copyright , Patents , Publicity/Privacy Rights , Trade Secrets , Trademark | TrackBack

January 07, 2013

Privacy Plaintiffs in Deep Packet Inspection Case Get No Love From the Tenth Circuit -- Kirch v. Embarq Managmenet

[Post by Venkat Balasubramani]

Kirch v. Embarq Management, No. 11-3275 (10th Cir. Dec. 28, 2012)

This is an appeal from one of the many lawsuits against IAPs for implementing the ill-fated NebuAd “deep packet inspection” system. Here’s my post on the district court grant of summary judgment in favor of Embarq: Deep Packet Inspection Lawsuits: NebuAd Partner ISP Wins Summary Judgment. Plaintiffs do not fare any better in their appeal.

On the factual side, plaintiffs were not able to develop any evidence that (1) Embarq obtained or utilized any of the data extracted by NebuAd, or (2) the flow of data through Embarq’s system differed in any way from how data typically flowed through Embarq's system (the big exception being that the data was routed in a way that allowed NebuAd to extract data regarding plaintiffs).

Canvassing the ECPA's legislative history and context, and the fact that there’s no general federal statutory liability for aiding and abetting (absent a clear Congressional directive), the court says that Embarq cannot be held liable for any alleged ECPA violations of NebuAd. Thus, the court looks to see if Embarq violated the ECPA directly.

With respect to whether Embarq itself “intercepted” plaintiffs’ communications, the court notes the clunky application of the term "intercept" to the facts. "Interception" is defined as the "acquisition" of a communication's “contents,” but the line between "access" and "acquisition" is murky at best. The court instead relies on the portion of the definition of “device” that excludes any equipment “used by a provider of wire or electronic communication services in the ordinary course of its business.” Noting there was no dispute that Embarq only acquired the same access to the data that it had as an IAP, the court concludes that Embarq falls under this exception and can't be held liable for intercepting plaintiffs' communications.

Ouch. There were some mildly favorable facts to Embarq (the fact that it was paid an absurdly small amount of money for participating in the DPI test), but I still find the emphatic defense win somewhat remarkable. Privacy plaintiffs just cannot seem to catch a break.

The lack of a derivative liability concept under the ECPA is significant, and a majority of courts have said there is no derivative liability under either the ECPA or the Computer Fraud and Abuse Act. (See also Valentine v. WideOpen West Finance (another NebuAd case) and the somewhat factually bizarre CAIR v. Gaubatz which recently came to the same conclusion on the ECPA issue; the CAIR case fell through the cracks of the blogging queue.)

Interestingly, in Valentine, the district court granted summary judgment on the basis that plaintiffs failed to adequately allege any interception but left things open as to whether plaintiffs could state a claim for "disclosure" or "use" of communications under 2511. The court directed the parties to file additional briefs on this issue.

Additional coverage:

Courthouse News: ISPs Duck Class Claims of Targeted Ad Spyware
Wendy Davis: Appeals Court Sides With Embarq in Privacy Lawsuit
InsidePrivacy: Two New Decisions on the Wiretap Act and Secondary Liability
Bloomberg/BNA: ISP Falls Beyond Reach of ECPA for Role In Transmitting User Traffic to NebuAd

[image credit: Shutterstock/lightspring - Internet privacy and spying on line with a computer laptop and the web by hacking or cyber virus that steals your technology data and follows your social media history]

Posted by Venkat at 04:26 AM | Privacy/Security , Publicity/Privacy Rights

January 02, 2013

Section 230 Still Keeping the Pro Se Plaintiffs at Bay--Klayman v. Facebook, and More

By Eric Goldman

I'm personally committed to blogging every Section 230 case I see, but I fell off the wagon in the second half of 2012. So what better way to usher out 2012 and ring in the new year than to recap some Section 230 wins from the past 6 months? The following four cases all involve pro se litigants whose unmeritorous cases got unceremoniously swept out of court, just like Baby New Year walks Father Time out the door. In 2013, I resolve to give continued thanks to Section 230 for keeping the court system relatively free of junk lawsuits like these:

Klayman v. Zuckerberg, 2012 WL 6725588 (D.D.C. December 28, 2012). Klayman is a lawyer-plaintiff. For reasons that are unclear to me, pro se lawyer-plaintiffs fail in court at about the same rate (or worse) as the typical pro se. I find this hard to comprehend; after all, shouldn't lawyers have a better sense which legal claims are worth pursuing than the average individual litigant? Presumably, the only more knowledgeable litigants are judge-plaintiffs; I don't see many of those cases, but these usually also fail in a pretty embarrassing way. This sounds like a good area for further research.

Larry Klayman is notorious enough to have his own Wikipedia page. I'm not sure how to gauge his accomplishments because the Wikipedia page only highlights his failed lawsuits--the word "unsuccessful" shows up four times on the page, not including this lawsuit.

The case involves a user-created Facebook page titled 'Third Palestinian Intifada.'" It's not clear from the opinion how this page harmed Klayman, but I guess it doesn't take much to provoke a lawyer to sue. While typing the complaint, Klayman's finger apparently got stuck on the "zero" key. He demanded $1,000,000,000.00--that's right, $1 billion--because Facebook didn't take down the page fast enough.

The court runs through the typical three-factor Section 230 analysis:

1) ICS? Facebook provides an interactive computer service because it maintains "a website that gives its users the ability to create, upload, and share various types of information, potentially with hundreds of millions of other users."

2) Publisher/Speaker Claim? Klaynan sued Facebook for assault (!) and negligence. The court says:

the defendants' alleged conduct ascribed to them the status of publishers of information, whether by "using" the website to post certain content (i.e., publishing), id. ¶ 17, "allow[ing]" certain content to be posted to the website (i.e., deciding whether to publish), id. ¶¶ 17, 19, or by "refus[ing] . . . to remove these postings," id. ¶ 19. The defendants' potential liability is thus "derive[d] from [their] status or conduct as a publisher or speaker."

Klayman belatedly attempted the Barnes promise-based workaround to Section 230 and gets mocked:

It begs credulity that the plaintiff, a "highly visible and well known lawyer," Compl. ¶ 11, would not have included a claim for breach of contract if he contemplated such a claim as a viable possibility.

3) Were the defendants the ICPs? [note: normally this is phrased as whether the content came from third party content providers, but I think this restyling is OK in this case.] The court says:

Nowhere in his complaint or in his opposition brief does the plaintiff allege that the defendants contributed to the content of the Facebook page at issue. Rather, as described above, the plaintiff focuses on the role that the defendants played in publishing the Facebook page. [FN3] The plaintiff's own allegations are inconsistent with a finding that the defendants acted as information content providers with respect to the offensive material at issue.

FN3 is interesting. Klayman argued that Facebook collects data about its users and then personalizes their site views based on this data. The court says that even if that's true, it would just represent another form of editorial control immunized by Section 230.

Having satisfied the three elements of a successful Section 230 immunity, the court grants Facebook's motion to dismiss. This is a good outcome for Facebook, but I'm not clear why Facebook didn't make an anti-SLAPP motion under D.C.'s anti-SLAPP law. That way, Klayman would have to write Facebook a tuition check for his Section 230 schooling. Even without anti-SLAPP protection, I hope Facebook seeks Rule 11 sanctions against Klayman. We haven't seen too many courts grant Rule 11 motions in Section 230 cases (I wish they did) but Klayman's lawsuit broke absolutely no new legal ground and was doomed from inception.

A Facebook spokesperson told me: "We are pleased with the court's ruling dismissing all claims with prejudice."

Merritt v. Lexis Nexis, 2012 WL 6725882 (E.D. Mich. October 23, 2012). Merritt claimed Lexis-Nexis published false information about him. The court never explicitly says the information comes from third parties, but that's the logical inference given Lexis-Nexis' business model. The court says that Lexis-Nexis qualifies for Section 230's immunity (citing the memorable Gaston case). The court then says Merritt's claims fall "squarely" in Section 230's immunity.

Nieman v. Versuslaw, Inc., 2012 WL 3201931 (C.D.Ill. August 3, 2012). See also the magistrate's report, 2012 WL 3201935 (C.D.Ill. June 13, 2012). I've held off blogging this case because the University and I have received threats from Nieman (lucky us!). So just the facts on this one.

The court summarizes Nieman's arguments:

Between January 2009 and the date of filing this action, Plaintiff applied for one or more positions of employment. Plaintiff believes that the potential employers have performed Internet browser searches by way of Google.com, Yahoo.com, or Bing.com, and found documents related to litigation against his former employer Nationwide. Plaintiff also believes that the potential employers have used this information to disqualify him from candidacy for the applied position or have shared this information with others who have done so. In other words, Plaintiff alleges he “has been effectively ‘blacklisted’ as to employment opportunities due to the ease at which these references appear pursuant to a simple name search, and due to the unlawful acts of third parties who then use such information to unlawfully disqualify” his candidacy.

He sued Microsoft, Versuslaw, Yahoo!, Google, and Joseph W. Acton for, among other claims:

* violations of Illinois' human rights law. The court rejects the claim, saying the complaint only alleged "Defendants provided access to public information that potential employers used to deny Plaintiff employment," and that doesn't suffice.

* publicity rights. The court says:

First, the exemption from liability for using a person's identity for a non-commercial purpose, including in a news or public affairs account is applicable here. Plaintiff's prior litigation is a matter of public record and public interest. Moreover, Plaintiff's identity is not being used for a “commercial purpose” as defined by the Right of Publicity Act because his name is used only to find documents related to his case, which are part of the public record. His name is not being held out or used to entice anyone to buy a product. Under Plaintiff's theory, every person who is involved in litigation who has public court documents that can be accessed for a fee on the Internet by doing a browser search or found by using Westlaw, Lexis, Versuslaw, or any other legal research site can state a claim under the Right of Publicity Act. This cannot be the case.

* 42 USC 1981. The court says he didn't allege any discrimination on improper bases.

* Lanham Act. Nieman alleged "Defendants Versuslaw and Acton are attempting to associate Plaintiff with their for-profit website. Plaintiff accuses Defendants Google, Yahoo, and Microsoft of actively participating in “these unlawful acts ... by way of their paid search ranking and/or AdWords mechanisms.”"

Citing Stayart v. Yahoo, the court says Nieman doesn't have standing because he lacks the requisite commercial interest in his name.

* Unjust enrichment. "Defendants are not “retaining a benefit” to Plaintiff's detriment just because they are selling electronic access to public information and Plaintiff does not like the information contained in those public documents."

The court also grants Microsoft and Yahoo's First Amendment and 47 USC 230 defenses. Regarding the First Amendment, the court says "all of Plaintiff's allegations rest on the premise that Defendants' websites provide links to information that is in the public record. Plaintiff cannot show he is plausibly entitled to relief." Regarding 47 USC 230, the court says that it agrees with the magistrate report that Section 230 applies, but the judge expresses uncertainty about the immunity for the trademark and publicity rights claims because they are IP claims; and also about the RICO claim as a federal crime (the court doesn't cite the several cases rejecting its line of reasoning on that point).

Getachew v. Google, Inc., 2012 WL 3217611 (10th Cir. August 9, 2012). This case is quite similar to the Nieman case. The court recaps:

Mr. Getachew alleges that when all or part of his name is entered into Google's Internet search engine, the search results yield negative information about him. For example, Mr. Getachew was previously a plaintiff in an employment action, and he alleges that the summary judgment order in that case is available when part of his name is entered into Google's search engine. He also alleges that another Google search result links his name to a "[g]raduate position available in evolutionary systems biology."

All of this, he alleges, hurt his employment prospects. The district court said that his discrimination and Title VII claims were "frivolous" and his state law claims against Google were immunized by 47 USC 230. The appeals court upholds these conclusions. With respect to 47 USC 230, the court says "Google is immune from Mr. Getachew's state-law claims under 47 U.S.C. § 230(c)(1). Under that provision, Google cannot be held liable for search results that yield content created by a third party."

[Photo Credit: Dust Bunny // ShutterStock]

Posted by Eric at 07:38 AM | Content Regulation , Derivative Liability , Privacy/Security , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

December 31, 2012

Google's Privacy Policy Integration Initially Defeats Legal Challenge -- In re Google Privacy Policy Litigation

[Post by Venkat Balasubramani with comments from Eric]

In re Google, Inc. Privacy Policy Litigation, C 12-01382 PSG (N.D. Cal.; Dec. 28, 2012)

In a decision that should be closely watched by the Instagram plaintiffs who are complaining about Instagram’s terms of use changes, Magistrate Judge Grewal initially rebuffed plaintiffs’ efforts to challenge Google’s privacy policy changes.

Plaintiffs are unhappy about Google combining its 70 odd privacy policies into a single policy, which Google explains has the following effects:

The main change is for consumers with Google Accounts . . . Our new Privacy Policy makes clear that, if you’re signed in, we may combine information that you've provided from one service with information from other services. In short, we’ll treat you as a single user across all our products, which will mean simpler, more intuitive Google experience.

The complaint alleges “violations of the Wiretap Act, 18 U.S.C. 2511 et seq., California’s Right of Publicity Statute, Cal. Civ. Code 3344, California’s Unfair Competition Law, Cal. Bus. & Prof. Code 17200 et seq., California’s Consumer Legal Remedies Act, Cal. Civ. Code 1750 et seq., common law breach of contract, common law intrusion upon seclusion, common law commercial misappropriation, and violation of consumer protection laws of the various states.”

The court does not get to the merits, and instead rebuffs plaintiffs on the basis that they do not satisfy the requisite (Article III) standards for standing.

The first argument for standing was that the privacy policy changes would force plaintiffs to replace their Android-powered devices. However, no plaintiff actually alleged that he or she actually was “forced” to replace their phone on the basis of the privacy policy changes.

Second, the court also takes issue that the combining of personal information by Google causes any (compensable) harm at all. Citing to Specific Media, a cookie case, the court says that vague ideas of “opportunity costs,” “value-for-value exchanges,” “consumer choice,” and “diminished performance,” are not enough for standing.

Finally, the court grapples with the issue of whether an alleged statutory violation is enough for standing. Although the court’s resolution of this issue is not entirely clear, the court expresses doubt regarding plaintiffs’ ability to get past a Rule 12b6 motion on at least two causes of action: the Wiretap Act and California’s right of publicity statute. The Wiretap Act claim probably fails because the definition of “device” excludes any equipment used by Google in the ordinary course of its business (and the statute contains a carve-out for interceptions by providers). The publicity rights claim fails because the plaintiffs simply do not allege any use of their “name, voice, signature, photograph, or likeness . . . .”

As I mentioned initially, Instagram plaintiffs take note! I think they will have an even harder time than the plaintiffs in this case, but they are sure to face an initial standing hurdle (regardless of how they fare on the merits).

Here is a big question that's left unaddressed, at least in the order: are Google's changes prospective only or do they apply to previously collected data. I'm guessing the answer has to be the latter, because it seems foolish to challenge a prospective-only change. A follow-up question would be whether Google gives people the ability to wipe their old data. I don't have a ton of confidence for the FTC to resolve these issues (although the confidence level is slightly higher than in the class action system), but this all makes you wonder whether these changes have to go through the FTC hoop. My understanding was that any material changes of privacy policies have to be submitted to the FTC (or something like this)?

It's interesting to see courts continue to grapple with the question of whether a statutory violation is enough to create standing.

Also interesting to see the continuing viability of the Specific Media opinion, which did a nice job of breaking down plaintiff's abstract contentions around the loss of value to personal information arguments. I wonder if other arguments will take their place (e.g., price discrimination based on tracking) but in any event, we've seen enough cases reject this argument to know its viability is seriously in doubt.
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Eric's Comments

What a fitting way to end 2012, much like it began: with yet another bogus privacy lawsuit against an Internet company being tossed from court early. I don't know whether I'm heartened by the way the judicial system has handled the onslaught of privacy lawsuits in 2012, or saddened by the fact that privacy plaintiffs lawyers don't seem to be getting the message. Maybe that horse has left the barn; perhaps for the rest of our careers, we're destined to see a never-ending flow of bottom-feeding lawsuits every time an Internet company sneezes. Oh joy.

Even though Judge Grewal properly flushes this P.O.S. down the toilet, it's not all hugs and kisses to Google, especially when he says:

The court observes that Plaintiffs have raised serious questions regarding Google’s respect for consumers’ privacy.

He's right, and we should have an intelligent and cogent discussion about that. I sometimes wonder about Google's practices myself. Still, no matter how angry you are with Google's privacy practices, you should be even angrier about junk privacy lawsuits that aren't intended to, and won't, advance our interests as consumers.

Posted by Venkat at 09:51 AM | E-Commerce , Marketing , Privacy/Security , Publicity/Privacy Rights

December 26, 2012

Lawsuit Against Instagram Over Terms of Service Changes Looks Flimsy -- Funes v. Instagram

[Venkat Balasubramani with a comment by Eric]

Funes v. Instagram, 12-6482 (N.D. Cal. complaint filed Dec. 21, 2012)

Eric and I posted about Instagram’s recent TOS rev. Neither of us were particularly enthusiastic about the changes. (See Facebook's Proposed Amended Sponsored Stories Settlement and Instagram's Revised TOS.) Not surprisingly given the privacy bar's affection for suing Internet companies, the changes sparked a lawsuit. But, the lawsuit is not a winner. In fact, it’s borderline frivolous.

The lawsuit asserts claims for breach of contract; violation of California’s publicity rights statute; breach of bailment (creative!); unfair competition. Plaintiff also asks for declaratory relief.

Courts have held that the imposition of a revised terms of service is not sufficient grounds for a lawsuit. (See Fineman v. Sony Network. Fineman is highly relevant, and involved similar arguments against a paid service.) An even bigger problem is that the revised terms are not in effect yet. Not only can the currently proposed terms be changed by Instagram (Instagram indeed made a few revisions in response to user outcry), the users can remedy any problems themselves—they can exercise self-help and leave the network before the new terms apply. In the event plaintiff does not withdraw its lawsuit (and she really should), I’m sure the many arguments will be fleshed out in Instagram’s motion to dismiss. In any event, here’s my initial summary.

Breach of contract: There’s nothing wrong with Instagram changing contractual terms on a prospective basis. To the extent plaintiff claims that the revised terms “interfere[] with and frustrate[] Plaintiff and the Class' use of the Instagram's service,” this is something Instagram is perfectly entitled to do.

Section 3344 claim: This is the personality rights statute that was at issue in Fraley. As I mentioned in my initial blog post about Instagram’s terms, I don’t believe the revisions really effected a material change. This language around sponsored stories was likely protective in nature, and brought about as a result of the Fraley settlement. In any event, Instagram’s blog post following the uproar expressly disclaimed its intent to broadly exploit user content in this manner.

Bailment: I don’t know what to make of the bailment claim. Query as to whether bailment applies to digital materials at all. [Eric's comment: it doesn't]. In any event, Instagram’s initial terms of service I’m sure allows it to retain any photographs uploaded to its service. Query as to whether Instagram can change the terms and have the terms apply to old content and not allow users to delete or disable the old content. It’s unclear as to whether Instagram allows users to delete their accounts or photos. In any event, this question is premature.

Section 17220 claim: Damages are limited under this section to money that has been paid by plaintiffs. In this case: zero dollars. Injunctive relief may be available, but again this is premature.
__

Instagram’s TOS rollout was clunky, mostly because it did not anticipate user reaction around the key question of whether users could control monetization or off-platform use of their photos. FWIW, Instagram’s various public statements still do not adequately address this issue!

As to whether the revisions warranted a lawsuit the answer is obviously no. This is a classic example of lawsuits against social networks gone completely amok. For the most part, when a change is effected prospectively, plaintiffs will be left to argue unconscionability. As numerous cases make clear, this is an extremely difficult argument to make.

As Eric noted elsewhere, Section 3344 has a mandatory fee-shift, and could result in plaintiff having to write a check to Instagram.
___

Eric's Comment I can't say I'm a fan of Instagram's recent behavior, but I'm even less of a fan of publicity-seeking throw-lots-of-garbage-into-a-complaint-and-hope-something-sticks lawsuits like this one. It's a sign of a slow news week (and a season when reporters have difficulty finding credible sources) when a bogus lawsuit like this gets any press coverage at all--other than the loud and mocking guffaw it deserves.

Posted by Venkat at 05:42 AM | Copyright , E-Commerce , Licensing/Contracts , Publicity/Privacy Rights

December 20, 2012

Facebook’s Proposed Amended Sponsored Settlement and Instagram’s TOS Revs

[Post by Venkat Balasubramani]

Fraley v. Facebook, 11-cv-196193 (N.D. Cal.) (Amended Proposed Settlement) (Motion to Approve) (Preliminary Approval) (case docs, compiled by Citizen Media)

I initially passed on blogging the amended proposed settlement agreement in Fraley v. Facebook, the Sponsored Stories class action lawsuit, but the recent changes to Instagram’s terms of service brought the issues to the fore.

The Fraley Claims: As detailed in several posts here, Fraley involved misappropriation claims based on Facebook’s Sponsored Stories initiative. Essentially, end users claimed that Facebook’s use of their posts for advertising purposes constituted an unauthorized exploitation of their publicity and personality rights. (Minors piled on separately.) Facebook couldn't easily extricate itself from the putative class action, and accordingly it settled. Its first attempt to settle the lawsuit did not meet with judicial approval—the court said that while the terms may be fair, it was not presented with sufficient information to evaluate its propriety. Facebook and the plaintiffs went back to the drawing board and made a few key changes to the proposed settlement. Not surprisingly, the second iteration met with approval.

Amended Settlement: One big change in the proposed settlement: Facebook offered up cash ($20 million settlement fund). It also supposedly offered users greater control over use of their likeness. The lawyers also made a helpful concession about the amount of requested fees that would go unchallenged.

it’s tough to assess the revised settlement in terms of the injunctive relief that it provides—it’s supposed to allow greater control over the use of end users’ likeness. However, the settlement is somewhat awkwardly worded in terms of control to end users. Facebook will create a mechanism that allows users to view their interactions that "have been" displayed in Sponsored Stories and will enable users to "control which of these interactions . . . are eligible to appear in additional Sponsored Stories." The peculiar combination of past and future tense in the phrasing should raise eyebrows. I guess a global opt-out was too much to ask for.

The Upshot: Given the majority opinion in Lane (the Beacon case), the original settlement seemed like it had a chance of being approved. As revised, I imagine it will easily receive final approval. Judge Seeborg already gave it his preliminary thumbs up.

Instagram TOS Changes: On a somewhat related note, Instagram recently unveiled changes to its terms of service. While it’s difficult to assess user reaction (Flickr was billed as the obvious beneficiary), celebrities, high profile users, and photographers all expressed their displeasure. It’s worth stopping to think about exactly what has changed. On this point, see this helpful redline from William Carleton. The big change (and one that may not be material) is the change from Instagram being able to “place . . . advertising and promotions on the Instagram Services or on, about, or in conjunction with your Content,” to the following:

You agree that a business or other entity may pay us to display your username, likeness, photos . . . and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you.

I don’t see this as a significant change to what Instagram can do with your photographs. The fact that the language of the revised terms tracks relevant language from the Amended Settlement Agreement in Fraley makes me think this is just a clean up change to bring Instagram’s terms into conformity with what is required of Facebook under the revised settlement.

Unfortunately, both the previous and current version fail to answer the key question about the scope of the license users grant: will usage only occur within the Instagram ecosystem, or can Instagram license out photos to third parties to use in other media (e.g., magazine ads or television)? Could my photo of a Seattle sunset end up in a Coca Cola ad where Instagram is paid money for usage of the photo? "Very IP" makes a persuasive case that new language around transferability or sublicensability means that Instagram can under the revised terms exploit content outside the ecosystem: "The Truth About Instagram." I'm not totally persuaded. In this litigious environment, particularly in light of Facebook's experience with Beacon and Fraley, any off-line rights would be clearly called out in its license agreement. Any other approach would just be inviting a lawsuit. In light of the (still pending) AFP v. Morel dispute (where AFP allegedly took photos from Twitpic and argued that it was entitled to a broad license to distribute content elsewhere), this clarity is important to users. I have no idea why Instagram dropped the ball on addressing this.

A day after the big online meltdown, Instagram’s founder published a post acknowledging user outcry and saying that it is committed to not “selling your photos” . . . whatever this means.

This was a classic example in how not to revise a terms of service. Instagram highlighted the revised terms clearly for users, but failed to anticipate what users would care about. Eric makes a few good points below about the terms that have me scratching my head. Did Instagram really leave in the "we can amend these terms whenever we want" provision in its revised terms? Ouch.

It's easy from our perspective to nitpick about the direction Instagram chose, but overall it feels unimaginative to me. They could have taken a variety of routes, ranging from offering users an opt-out (even a paid alternative) to granular control, to a revenue share (ad/brand marketplace?), but Instagram looks like it is doing what Facebook would do. Not surprising, but sort of a bummer for users. I guess it's a good illustration that the Fraley (and the FTC) settlement notwithstanding, Facebook is ready able and willing to override user preferences. [Query as to whether these changes in any way implicate the FTC consent decree covering Facebook, or the companies' promise to stay separate?]

Other coverage on the Instagram Issue:

EFF (Kurt O.): Instagram's New Terms of Service to Sell Your Photos
Creative Commons: Should Instagram adopt creative commons licensing?
William Carleton: Why not share the revenue?
Verge (Nilay Patel): No, Instagram can't sell your photos
Wendy Davis: User Revolt Spurs Instagram to Backtrack on New Terms of Service
Very IP: The Truth About Instagram
__________

Comments from Eric on Instagram:

1) When Facebook bought Instagram, what did Instagram users think was going to happen? Of course Facebook was going to bring its special style of management to Instagram. The revised user agreement is part of the ongoing Facebook-ization of Instagram.
2) If you run a high-profile website, you need to run any proposed user agreement changes through a user focus group before unleashing the revisions on the public. This way, you can preview the potential pitfalls better than if only lawyers and insiders read the terms. If Instagram did run its proposals through a focus group, then it needs to do a better job of that.
3) Instagram's proposed contract revisions still contain the ability of Instagram to unilaterally amend the terms without notice. After Zappos' meltdown, that's a really bad idea from a legal standpoint.
4) Although I knew what Instagram was trying to say with its provision to let them turn Instagram content into Sponsored Stories ads, the provision was clumsily worded at best and easy to misunderstand. (As Venkat points out, Instagram should have known about the risk people will think they are turning into a stock photo agency after the Twitpic debacle). People overreacted by thinking advertisers could freely recycle their photos; even if Instagram took the copyright license, if anyone appeared in the photos, the advertisers still would need a separate publicity rights consent. Sill, it was absolutely shameful for Instagram to then blame the concerns on users misunderstanding the contract provisions. Users can misunderstand even clear contract language, but this was not clear language. The fault lies with Instagram's drafters, not the users.
5) I was particularly flummoxed by the proposed provision "You acknowledge that we may not always identify paid services, sponsored content, or commercial communications as such." Can you even do this by contract? My best guess is that this provision is legally ineffective.
6) My question to all of the unhappy Instagram users: where are you going to go? All of Instagram's competitors--indeed, all free photo hosting options--are equally likely to turn on their users. Recall my dilemmas with Scribd. Moving from one free photo hosting site to another delays the problems, at best. It doesn't solve the underlying problem.
7) Overall, the biggest "problem" here is that Instagram users unrealistically expected that a free cloud service wouldn't turn on them. Every cloud service provider goes rogue on its users inevitably; and where the business' interests diverge from users, users are going to be thrown under the bus. Instagram users must have thought Instagram was the exception; and perhaps before Facebook bought it, they could have enjoyed a cloud utopia for a while longer before the collapse. But all users should have learned by now: when it comes to cloud services, you get what you get and you don't throw a fit. In light of the burgeoning number of times cloud services have quite publicly gone rogue on users, it's becoming increasingly less reasonable for users to expect anything differently. There's only one way for users to truly control the fate of their online digital assets, and that's to host all of their content on their own website. If you don't want to do that and you're looking for a free and easy option, you get what you get.

Added (comments from Venkat): In response to the feedback, Instagram founder Kevin Systrom announced in a blog post that Instagram is "reverting" the advertising language to what had been in effect from the beginning. (Here's the blog post: "Updated Terms of Service Based on Your Feedback" and here is a link to the revised terms.) The post also explains:

Going forward, rather than obtain permission from you to introduce possible advertising products we have not yet developed, we are going to take the time to complete our plans, and then come back to our users and explain how we would like for our advertising business to work.

You also had deep concerns about whether under our new terms, Instagram had any plans to sell your content. I want to be really clear: Instagram has no intention of selling your photos, and we never did. We don’t own your photos – you do.

Finally, there was also confusion about how widely shared and distributed your photos are through our service. The distribution of your content and photos is governed by our privacy policy, and always has been. We have made a small change to our terms to make that as clear as possible.

Left in is the language saying that the license to "use" user content is "transferable, sub-licensable," subject to limitations in the privacy policy. This may be protective (or clunky) drafting, but I still can't tell if Instagram intends to exploit user content outside the ecosystem. It's awkward to use privacy preferences as the limitation on how Instagram can use the photos. (For example, language in the policy says: "[o]nce you have shared User Content or made it public, that User Content may be re-shared by others," but it's not entirely clear what this means.) For public photos, it looks like the language still gives Instagram room to freely use (outside the ecosystem) content that has been designated as "public". Again, this may not be the intent, but to me, the language is not 100% clear.

Posted by Venkat at 11:19 AM | Copyright , Internet History , Licensing/Contracts , Publicity/Privacy Rights

December 04, 2012

Employee/Ex-Employer Lawsuit Over Twitter Account Settles – Phonedog v. Kravitz

[Post by Venkat Balasubramani]

PhoneDog v. Kravitz, No. C 11-03474 MEJ (N.D. Cal.)

This is one of the first cases where employee and employee (in this case contractor) battled over a Twitter account. Noah Kravitz worked for PhoneDog as a contractor.
He left and took the account with him. The parties dispute the sequence of events, but he says he changed the @PhoneDog_Noah username to "@noahkravitz" with PhoneDog's blessing. PhoneDog sued, asserting claims for conversion, misappropriation of trade secrets, and interference with economic relationships. Although they didn’t necessarily seem on solid legal ground, the court ultimately allowed these claims to proceed. (Kravitz predictably asserted counterclaims.) (Here are previous posts on the case: "Courts Says Employer's Lawsuit Against Ex-Employee Over Retention and Use of Twitter Account can Proceed"; "Court Denies Kravitz’s Motion to Dismiss PhoneDog’s Amended Claims"; and "An Update on PhoneDog v. Kravitz, the Employee Twitter Account Case".)

The lawsuit was originally filed in July 2011, and as Mashable initially reported has been finally resolved by agreement of the parties: “Writer Sued for his Twitter Followers Settles Case.” Terms of the settlement agreement do not appear to be public, but at a minimum it looks like Kravitz will be holding on to the Twitter account.

Employment disputes by nature can be emotional affairs, and when you add a social media component to it, I can see emotions running high, and decisions being made based on emotion rather than reason. It’s interesting that the parties decided to settle the case almost a year and a half after it was filed, with no significant litigation activity other than the initial denial of Kravitz’s motion to dismiss. You wonder why they didn’t resolve things easier. (This is often easier said than done, and the pure attrition of time and expenses can work wonders for the parties’ willingness to settle.)

Any useful takeaways from the dispute? The obvious is to have a written agreement in place governing employee social media accounts. The other is that social media accounts often mix the personal and the professional, so from a practical standpoint making a clean break may not be possible. In this vein, recently enacted social media legislation may also fall short of providing a clean solution. (See "Big Problems in California's New Law Restricting Employers' Access to Employees' Online Accounts"; see also the earlier point: a contractual solution is preferable.)

When all is said and done, I really wonder about the economics of the litigation. Was it worth it for PhoneDog to really chase after the account after Kravitz had removed any branding from the account. On the flip side, what would have happened if Kravitz had just abandoned the account and started fresh? Either scenario would not have been the end of the world. Ultimately, the parties were battling over "followers," who can be fickle, unpredictable, and certainly tough to place a value on.

[image credit: Shutterstock:zozian greetings .. "bluebird sticker"]

Posted by Venkat at 08:07 AM | Licensing/Contracts , Publicity/Privacy Rights , Trademark

November 28, 2012

Employee Terminated for Facebook Message Fails to State Public Policy Claim -- Barnett v. Aultman

Barnett v. Aultman Hosp., 11-CV-399 (N.D. Oh. Oct. 31, 2012)

Barnett was a nurse at Aultman Hospital. She didn’t particularly get along with her supervisor, Lisa Summer. While Barnett was on vacation, she received word that Summer had been fired.
Although this wasn’t true, she sent off an exuberant message to 14 of her Facebook friends:

Lisa got officially ax (sic) today! I am signing DING DON’T THE WITCH IS DEAD THE WICKED WITCH, DING DONG THE WICKED WITCH IS DEAD.

How poetic this comes the same day Sexton died, I would much rather get f..cked up the ass with hot pepper than endure what that souless (sic) bitch put me through for 4 years..including turning me into the board..God does grind a fine mill when revenge is taken on by him..back when I was off due to drug accusations and praying, and praying, never would I have imagined she lose (sic) her job, marriage, and family, friends all at the same time! Karma Now I should tell you how I really feel!
Love and fuzzies

The email was forwarded to Ms. Summer (duh), who forwarded the message on to the supervisor in charge of investigation and misconduct. When initially asked whether she authoried the email, Barnett predictably denied it, and started “talking about people hacking into her account.” When given a chance to explain, Barnett stuck to her story, going as far as to deliver a letter to the hospital explaining that Barnett’s account was subject to phishing and that she intended to turn over certain information to authorities to get to the bottom of everything. In the letter, she continued:

it was very offensive as well as defaming to my character to even imply that I wrote [those words]. The people who hacked in my personal account, are the people who wrote it.

Unfortunately, the employee who originally provided Summer a copy of the message also confirmed that Barnett admitted to authoring the celebratory email. Another co-worker also confirmed that Summer sent a text message along the lines of “[t]he witch is dead..Lisa got fired.”

The investigator decided that Barnett should be terminated. Separately, Barnett had requested a copy of the FMLA form, but the investigator testified that she was unaware of this. The first time the investigator found out about Barnett’s alleged medical issue is when she called Barnett to arrange a meeting at which Barnett would be fired.

The investigator told Barnett that rather than being terminated, Barnett would be given an opportunity to resign, and would even be given a neutral evaluation. Barnett nevertheless stuck to her story and stated that she resigned due to hostile working conditions and defamation of her character.

Ultimately, after she filed suit but prior to her deposition, Barnett came clean and admitted everything. For reasons the court doesn’t explain, she didn’t just drop her lawsuit (alleging that she was terminated in violation of public policy and in derogation of her FMLA rights).

Termination in violation of public policy: As to her claim that her termination was in violation of public policy, the court says that it "founders" on the first element:

[t]here is no clear public policy forbidding private actors from restricting speech.

The court says that the result is the same under either the First Amendment or Ohio law—neither form the basis for any sort of public policy exception to the at-will rule. The court, surprisingly, spends several pages coming to a conclusion that I had thought was glaringly obvious: when it comes to free speech, “the restrictions appropriately placed upon the state are not appropriately placed on private actors.”

No interference with FMLA rights: The court also grants summary judgment against her FMLA claims. She can’t show that the employer interfered with her exercise of FMLA rights because she lost any such rights when she was terminated. She argued that she was injured by the employer’s failure to provide her with notice of her FMLA rights, but it wouldn’t have mattered anyway. She also fails to make out a claim for retaliation. The decisionmakers in question were not aware that she had requested FMLA leave, and in any event, offered a non-pretextual reason for terminating her: she lied about the Facebook message and this was a violation of the employer’s handbook policies.

Moral of the story? If you don’t have anything nice to say, don’t say anything at all!

Seriously, we’re reminded time and time again that you should be careful of what you say in email, online, on Facebook etc. When confronted with a statement you’ve made, it’s probably a bad idea to deny it and then claim you’ve been hacked. It’s a modern iteration of the “dog ate my homework” that will almost always ring a little untrue.

As to the court's underlying conclusion that there's no public policy exception for a termination in this type of a case, with the disclaimer that I'm no employment law expert, that sounds eminently reasonable to me (if not obvious). NLRB overzealousness aside, it would make sense that you should be able to terminate your employees for mouthing off and bashing their supervisor, whether this takes place in a Facebook post or a private message.

[image credit: Shutterstock/Complot "man with flames leaving his mouth"]

Posted by Venkat at 08:56 AM | Content Regulation , Publicity/Privacy Rights

October 23, 2012

How Long Does a Post-Mortem Right of Publicity Last?--Hebrew University v. GM (Guest Blog Post)

by Guest Blogger Tyler Ochoa

The right of publicity is a state-law right to use one’s identity for a commercial purpose. Thus, if you want to use a celebrity’s name or image in an advertisement, you have to get his or her permission. Similarly, if you want to sell merchandise that features a celebrity, you probably have to get his or her permission. (I say “probably” because you may have a First Amendment right in some circumstances. But that’s a topic for another day.)

A long-running debate is whether and how long the right of publicity should continue after the death of the person involved. The heirs and estates of dead celebrities argue that celebrities should be able to leave their “assets” to their heirs, that consumers may think that the heirs endorsed the advertiser or the product, and that it would be unfair to allow the advertiser or the merchandiser to make money without sharing it with the celebrity’s family. Advertisers, merchandisers, and public domain advocates argue that celebrities shouldn’t be able to control how their images are used after death. Imagine, for example, how many businesses are named after or use the images of Benjamin Franklin, Abe Lincoln, and other American icons. It would be bizarre if the images of those public figures could be kept out of the public domain and controlled forever by their remote descendants.

In the 14 states that have a statutory post-mortem right of publicity, the decision is made by the legislature. Most legislatures have adopted a term of years after the death of the celebrity, ranging from 20 years (in Virginia) to 100 years (Indiana and Oklahoma). One state, Tennessee, allows the right to last indefinitely, as long as it is being exploited (see Elvis Presley). California originally adopted a term of 50 years after the celebrity’s death, a term borrowed from the 1976 Copyright Act; after the term of copyright was extended to life-plus-70 years in 1998, California extended its statutory post-mortem right of publicity as well. Two states with statutory rights of publicity (New York and Wisconsin) confine the right to “any living person,” meaning there is no post-mortem right of publicity in those two states.

In states that recognize the right of publicity as a matter of common law, the situation is far less clear. In the ten states that have addressed the issue, five have held that there is no post-mortem right of publicity at common law (although three of those states have since adopted post-mortem statutes). Five states have recognized a post-mortem right of publicity at common law, without specifying whether it has a maximum duration.

The issue was recently decided as a matter of New Jersey common law in Hebrew Univ. of Jerusalem v. General Motors, LLC, 2012 WL 4868003, 2012 U.S. Dist. LEXIS 148150 (C.D. Cal. Oct. 15, 2012). The case involved a magazine advertisement that featured the face of Albert Einstein “digitally pasted onto a muscled physique, accompanied by the written message ‘Ideas are sexy too.’” Hebrew University of Jerusalem, which owns all of Einstein’s “literary property and rights” under his will, sued GM for unauthorized use of Einstein’s likeness.

Following a series of previous cases, the district court (A. Howard Matz, District Judge) held that the issue of whether Einstein had a post-mortem right of publicity, and how long it lasts, should be determined by the law of the state of his domicile at the time of death. (For a recent application of this principle, see my commentary on the Marilyn Monroe case recently decided in the Ninth Circuit.) Einstein was a resident of Princeton, New Jersey, when he died on April 18, 1955, so the district court decided it should apply New Jersey law. But New Jersey does not have a right of publicity statute, so the issues had to be addressed and decided as a matter of New Jersey common law. (The New Jersey legislature has twice rejected a bill that would create a post-mortem right of publicity with a duration of 70 years after death.)

Whether New Jersey even recognizes a post-mortem right of publicity as a matter of common law is an open question. In Estate of Presley v. Russen, 513 F. Supp. 1339, 1355 (D.N.J. 1981), a federal district court predicted (under the Erie doctrine) that New Jersey would recognize such a right, but that decision has never been ratified by a New Jersey state court. (Ironically, the Russen court did not apply the law of the state of Presley’s domicile at the time of death, Tennessee, but instead applied the law of the state where the infringement allegedly occurred.) At the time, however, Presley had been dead for less than five years, so the court did not undertake to decide how long the right should last; although it suggested that one might look to the Copyright Act (which was then life of the author plus 50 years) for guidance. Id. at n.10.

In the Hebrew University case, the plaintiff argued for a perpetual right of publicity, or in the alternative, for a term based on the current Copyright Act (70 years after death), while the defendant argued for no post-mortem right, or in the alternative, a right limited to 50 years after the celebrity’s death. The court concluded that “[a] maximum 50-year postmortem duration here would be a reasonable middle ground that is long enough for a deceased celebrity's heirs to take advantage of and reap the benefit of the personal aspects of the right.” In so holding, the court noted that the Restatement (Third) of Unfair Competition is skeptical about the value of a post-mortem right. See § 46, cmt. h (“As a general matter, however, the dignitary and proprietary interests that support the recognition of a right of publicity become substantially attenuated after death. Postmortem uses are also less likely to create a false suggestion of endorsement or sponsorship.”). In rejecting the life-plus-70 years term, the court noted that at the time that Einstein’s rights passed to the Hebrew University in 1982, both the Russen case and the then-existing Copyright Act suggested a life-plus-50 years term, so that the University could not have had a reasonable expectation that the right would last any longer.

The district court also relied on policy considerations in choosing a life-plus-50 years term. It stated that “[a]n open-ended right of publicity, or even a postmortem duration longer than 50 years, raises considerable First Amendment concerns and creates a potentially infinite curb on expression.” The court also noted that “the dizzying explosion in the tools of communication . . . [has] caused a swift and dramatic, but still developing, impact on ordinary life,” without expressly finding that it favored a shorter right. Finally, the court noted that 50 years is both the median and the mode (most-common) duration of the 14 states that have post-mortem right of publicity statutes. It concluded that “[a] maximum duration of 50 years appropriately reflects the balance between meaningful enforcement of the right of publicity after a famous individual's death and the public's interest in free expression.” Since the advertisement appeared 55 years after Einstein’s death, the court ruled in favor of General Motors.

One might ask why the District Judge took it upon himself to decide the issue. If New Jersey’s common law is unclear, why not certify the question to the New Jersey Supreme Court? A quick look at New Jersey’s certification procedure reveals the answer. Oddly, the applicable rule allows the New Jersey Supreme Court to answer questions posed to it only by the U.S. Court of Appeals for the Third Circuit. New Jersey appears to have completely overlooked the possibility that another federal court might be faced with deciding an unsettled issue of New Jersey law.

The decision will almost certainly be appealed to the Ninth Circuit, given that the Hebrew University makes millions of dollars licensing Einstein’s image for various purposes. (Einstein was #7 on Forbes’ 2011 of top-earning dead celebrities, raking in a cool $10 million.) Given New Jersey’s odd certification rule, however, the Ninth Circuit won’t be able to ask the New Jersey Supreme Court for guidance either. If the Ninth Circuit upholds the decision on appeal, it would effectively cast Einstein’s name and image into the public domain. As with Marilyn Monroe’s right of publicity, however, that statement is subject to four important caveats:

First, although Einstein’s likeness may be in the public domain as a matter of state law, anyone wishing to reproduce a specific photograph of Einstein will still have to negotiate with the owner of the federal copyright in that work.

Second, although Einstein’s name may be in the public domain as a matter of state law, use of his name for particular goods or services may infringe one of the many registered trademarks (by Hebrew University, its licensees, and others) that use Einstein’s name as a mark.

Third, it is possible that some states with a longer post-mortem duration will apply a choice-of-law rule that looks to the state of infringement, rather than the state of the person’s domicile at the time of death. (Washington State has such a statute, for example, although a federal district has held that it is unconstitutional. See Experience Hendrix, LLC v. Hendrixlicensing.com, Ltd., 766 F. Supp. 2d 1122 (W.D. Wash. 2011).)

Fourth, as the District Judge noted, “There is nothing stopping [the plaintiff] from petitioning the New Jersey Legislature to pass a statute, with retroactive applicability, that would create a definitive postmortem right of publicity with the extended duration that [it] seeks here.” Should the plaintiff succeed in doing so, Einstein’s name and likeness will be removed from the public domain and will once again become private property.

Posted by Eric at 09:40 AM | Publicity/Privacy Rights | TrackBack

October 10, 2012

Texas Court of Appeals Rejects Privacy Claims Based on Facebook Firing – Roberts v. Careflite

[Post by Venkat Balasubramani]

Roberts v. Careflite, 2012 Tex. App. LEXIS 8371 (Tex. Ct. App.; Oct. 4, 2012)

This is a companion case to one Eric blogged about, Sumien v. Careflite. Both cases involve EMTs who were fired for making intemperate statements on Facebook. (Roberts said she wanted to “slap” a particular patient; Sumien concurred with Roberts’ statements that restraints were appropriate and suggested a “boot to the head”.) Sumien’s appeal involved his intrusion of seclusion claim based on the fact that his co-workers and bosses saw his comment to Roberts’ post. As Eric noted, Sumien loses, and his “I didn’t understand Facebook” settings argument is kicked to the curb. (“The "I Didn't Understand Facebook's Privacy Settings" Argument Isn't Persuasive to Judges--Sumien v. CareFlite.”)

Roberts’ appeal was also restricted to her intrusion of seclusion claim. Predictably, the result was the same as in Sumien. Roberts failed to make any credible argument as to why:

Roberts’s messages to Calvert or of her comments on Schoenhardt [sic] wall—comments that could be viewed by third parties—constituted an intrusion upon Roberts’s seclusion.

The court also rejects her argument that the broad construction by the NLRB of employees' rights to comment on workplace conditions or engage in concerted activity somehow affects her intrusion claim.

Eric’s comments to Sumien pretty much say it all. You should assume anything you post to an electronic network (that is not a purely private message) is public. Because it is as a practical matter, and courts will treat it as such (the shoulder surfing exception notwithstanding). Intrusion claims in particular are weak, and here the equities overwhelmingly favored Careflite. Roberts was even warned that “the public sees [her] posts,” but she nevertheless continued her rant.

The court also appropriately rejected Roberts’s argument about the NLRB rules. As to the merits of her discharge, however, it raises an interesting question. The NLRB recently issued one of its first decisions on Facebook firings and the effect of an employer’s policy. Here’s the NLRB’s release: “NLRB finds Facebook posting that caused salesman’s discharge at Chicago-area BMW dealership was not protected.” The NLRB case involved an employee at an auto dealership who was terminated for Facebook posts. The NLRB took the auto dealer-employer to task for an overly broad policy (with a dissenting opinion). Interestingly, the board found that one of the posts—that complained about the quality of food at a customer event—was protected, but a different post actually precipitated the firing. I haven't dug into the NLRB ruling, but certainly Roberts had a colorable argument that her discussion about restraints was in the ballpark.

Related posts:

[image credit: Shutterstock]

Posted by Venkat at 07:13 AM | Publicity/Privacy Rights

October 07, 2012

Battle Over LinkedIn Account Between Employer and Employee Largely Gutted--Eagle v. Morgan

[Post by Venkat Balasubramani, with comments from Eric]

Eagle v. Morgan, 2012 WL 4739436 (E.D. Pa.; Oct. 4, 2012)

We’ve repeatedly posted about employer-employee (or ex-employee) disputes involving social media accounts (PhoneDog; Maremont; Kremer; Insynq). Eagle v. Morgan is in the same line, this time involving a LinkedIn account. Here’s our prior post on this case, where the court dismissed some claims but allowed others to proceed: Another Set of Parties Duel Over Social Media Contacts -- Eagle v. Sawabeh.

As relevant to the resolution of the latest round of motions, here's the court’s description of the LinkedIn account at issue:

Eagle used her account to promote Edcomm’s banking education services; foster her reputation as a businesswoman; reconnect with family, friends, and colleagues; and build social and professional relationships. [Another employee] assisted Eagle in maintaining her LinkedIn account and had access to Dr. Eagle’s password.

After Edcomm got acquired, the new owner eventually terminated Dr. Eagle. The company immediately took over her LinkedIn account, changing the account's login credentials and substituting in the name and photo of Dr. Eagle's replacement. Unfortunately for Dr. Eagle, the court grants defendants’ motion to dismiss her federal claims based on the Computer Fraud and Abuse Act and the Lanham Act.

CFAA: On the CFAA claims Eagle alleged damages due to opportunities she missed out on because she did not have access to her LinkedIn account. The court says this type of loss isn't sufficient to satisfy the jurisdictional threshold under the CFAA. I sympathize with Morgan and her pro se status, but her evidence that she missed out contacts with people who in the past had offered “$100,000+ business opportunit[ies]” seemed flimsy at best. (Who among us hasn't received messages--on social media--that promise a $100,000+ opportunity!)

Lanham Act: Eagle’s Lanham Act claim failed because the court found that, when Edcomm terminated Eagle, it switched out Eagle’s name and photograph (which was “completely deleted” from the account).

State law claims: Defendants also asked the court to decline jurisdiction over the state law claims and dismiss those, but the court declines (and declines defendants’ summary arguments to have them dismissed on the merits). Eagle's glimmer of hope is that she still has a conversion claim which the court says will proceed to trial.

Yikes. I’m not sure where to start with this one. As with all social media disputes, I really wonder how much is at stake in terms of real dollars and cents. Interestingly, Eagle was represented by multiple lawyers, but they both exited the picture, so she’s now proceeding pro se.

So, on to the million dollar question: is the LinkedIn account a corporate asset or a personal asset? My understanding from the record was that this was a personal LinkedIn account and not a “company account”. So I’m struggling to see how it should get treated as a company account. For Dr. Eagle, it’s more like a resume. Sure, the company included declarations that said it switched out the picture and name from the account after terminating Eagle, but does this really make any sense? People are going to try to connect with a particular person, and instead they will be directed to the LinkedIn profile of someone else? (I'm surprised the court did not delve into the details of what type of account is at issue, but courts seem to have this habit.)

As with all of these disputes, control over the account itself should be separated from access to contact information or ongoing ability to contact customers, which is what the employer really cares about. I'm not suggesting she should win based on a Lanham Act claim, and don't mean to set off Eric's "initial interest confusion" radar, but it doesn't make sense from the standpoint of expectations to have the company take over someone's personal account.

There were two unusual facts in this case. First, the company said that as a matter of practice, the LinkedIn account was maintained for the company's benefit, and after employees left, the company took control over the accounts of ex-employees. Second, the employer had access to the account and the password. (In this case, it was under the auspices of helping Dr. Eagle “maintain” the account, but still.)

This leads to the second million dollar question: how would this case have fared under California’s new social media privacy law? It depends on whether this account is a “personal” account or a “business-related” account? Like most other social media accounts, this one is a mix of the two. I’m also not sure whether that law—which was intended to provide for employee privacy—could inadvertently affect ownership disputes such as this one. (See Eric’s post on the statute and its problems.)

Although the court correctly resolves the CFAA and Lanham Act claims, I lean away from letting an employer take control over Eagle's LinkedIn account if it was just her personal account. To the extent there were trade secrets at play or other legitimate competitive restrictions, it makes sense for the court to impose to restrictions and include social media contacts in any such restrictions, but it’s a bizarre result that would allow the company/employer to control her personal LinkedIn account.

Employers and employees: we appreciate the blog fodder, but for your sakes, please spell out in writing in advance who owns what accounts. It will save you a lot of hassle and lawyers’ fees.

[Image credit: Shutterstock]

_________

Eric's Comments

1) Social media services offer multiple types of accounts. On Facebook, there are personal profiles and business pages. On LinkedIn, there are completely personal accounts, accounts that might be attached to one person but really are used as corporate accounts by that person (I'm thinking of corporate recruiters with a pro account, for example), and group pages. It may not make a difference to the legal analysis, but it's crucial for courts to distinguish between the different types of accounts.

2) Even social media accounts that start out as "personal" accounts can migrate into corporate accounts by how they are used.

3) If you use your account for both company and personal uses and your employer has your social media login credentials, chances are it's become a corporate account in practice. If Dr. Eagle's account really was Edcomm's legally, kudos to them for getting the login credentials before Dr. Eagle walked out the door.

4) The fact that social media accounts come in different flavors, and they can change their character over time, reinforces how completely stupid it is that California tried to cleave "personal" social media accounts from the universe of social media accounts without expressly addressing these different scenarios. Under the statute, was Edcomm wrong for asking for Dr. Eagle's login credentials initially? I have no clue. Being unable to answer that question in a test case that comes out merely days after a newly minted law (and was ongoing while the legislature was doing its work) reminds us that the legislature did a crappy job.

5) Venkat said it, but we can't reinforce it enough: multi-round legal battles over social media accounts are a war of attrition that neither side can ever win.

Posted by Venkat at 10:52 AM | Publicity/Privacy Rights , Trademark , Trespass to Chattels

October 04, 2012

Marilyn Monroe’s Image is Cast Into the Public Domain — Sort Of (Guest Blog Post)

by Guest Blogger Tyler Ochoa [check out Prof. Ochoa's casebook on publicity rights / affiliate link]

In 2011, Marilyn Monroe was #3 on Forbes magazine’s annual list of top-earning dead celebrities, earning $27 million for her estate. Next year, however, she may be absent from the list. Why? A month ago, the Ninth Circuit affirmed a lower court ruling that stripped Monroe’s estate of her post-mortem right of publicity, potentially casting her name and likeness into the public domain. See Milton H. Greene Archives, Inc. v. Marilyn Monroe LLC, ___ F.3d ____, 2012 WL 3743100, 2012 U.S. App. LEXIS 18419 (9th Cir. Aug. 30, 2012).

The right of publicity is the right to use one’s name and likeness (or other indicia of identity) for a commercial purpose. It is an IP right of relatively recent vintage. In 1953, in a case involving baseball cards, the Second Circuit predicted that New York would recognize a transferable “right of publicity” as part of its common law. That Erie-based prediction turned out to be wrong: in 1984, the New York Court of Appeals held that the right of publicity in New York was purely statutory. Because the New York statute provides the right only for “any living person,” there is no post-mortem right of publicity under New York law.

The California legislature enacted a right of publicity for living persons in 1971; but the California Supreme Court rejected a post-mortem right of publicity under its common law in 1979. The legislature responded by enacting a statutory post-mortem right of publicity in 1984, effective January 1, 1985. At the time, the right lasted for 50 years after the celebrity’s death; it has since been extended to 70 years after the celebrity’s death. Other states have statutory rights of publicity with different durations. For example, in 1994 Indiana enacted a post-mortem right that lasts 100 years after the celebrity’s death (largely at the behest of CMG Worldwide, a celebrity marketing firm based in Indiana).

When Marilyn Monroe died on August 5, 1962, none of these states recognized a post-mortem right of publicity, so it is hardly surprising that it was not mentioned in her will. The residual clause in Monroe’s will left 25% of the remainder of her estate to her psychiatrist, Dr. Marianne Kris. The remaining 75% went to her acting teacher, Lee Strasberg. Monroe had been particularly close to Lee Strasberg and his second wife, Paula. Paula Strasberg died in 1966, however, and Lee later married his third wife, Anna. When Lee Strasberg died in 1982, Monroe’s estate passed to Anna Strasberg, a woman who never met or knew Marilyn Monroe. Anna Strasberg was named executor in 1989, and she later founded Marilyn Monroe, LLC (MMLLC), a Delaware corporation, to manage Monroe’s right of publicity.

The controversy that led to the ruling began when MMLLC and its licensee, CMG Worldwide, sued the successors to the estates of several photographers for selling copies of their photographs of Marilyn Monroe (and merchandise emblazoned with those photos) without the permission of MMLLC and CMG. The cases were filed in the Southern District of Indiana, the home district of CMG. Seeking a more appropriate venue, Milton H. Greene Archives sued MMLLC and CMG in the Central District of California, seeking a declaratory judgment that MMLLC did not own Monroe’s post-mortem right of publicity. At the same time, Sam Shaw Archives sued MMLLC and CMG for a similar declaratory judgment in the Southern District of New York. The Southern District of Indiana transferred its cases involving the parties to those districts, and the two cases proceeded on parallel paths.

Although these cases potentially raised several interesting issues (including preemption by federal copyright law), the critical issue was choice of law. If either Indiana or California law applied, Monroe had a statutory post-mortem right of publicity. If New York law applied, she did not. The relevant choice-of-law principles provided that the applicable law was the law of the state in which Monroe was domiciled at the time of her death. If that issue was litigated on a clean slate, the outcome would be far from clear. At the time of her death, Monroe owned an apartment in New York and maintained a staff there; but she also owned a house in Brentwood, California, where she resided during the last several months of her life, and where she died.

In order to avoid a trial, the plaintiffs in the Shaw Family Archives case argued that even assuming that Monroe was entitled to a post-mortem right of publicity (under either California or Indiana law), CMG and MMLLC were not the owners of that right, because that right did not exist at the time that Marilyn Monroe died, and therefore it could not have been transferred by will to her testamentary beneficiaries. Because CMG and MMLLC claimed ownership of the right by transfer from her testamentary beneficiaries, a ruling that the rights could not be transferred by will would deprive them of standing to pursue their infringement claims. Instead, the right would have vested in her statutory beneficiaries, under the law of intestate succession. Shaw Family Archives, Ltd. v. CMG Worldwide, Inc., 468 F. Supp. 2d 309 (S.D.N.Y. 2007).

Although Marilyn Monroe was married three times (including famously to New York Yankees’ Hall-of-Fame center-fielder Joe DiMaggio and playwright Arthur Miller), she was divorced at the time of her death and did not have any children. Accordingly, under the California statute, any post-mortem right of publicity would have passed to her mother, Gladys Baker (who died in 1984), and her father, Edward Mortensen (who died in 1981). Since both of her parents had died by the time California’s post-mortem right came into effect on January 1, 1985, under Shaw Family Archives, Monroe’s right of publicity terminated upon her death.

Two weeks after the ruling in Shaw Family Archives, the federal district court in California reached the same conclusion, holding that Marilyn Monroe “could not have devised a statutory right that was created only decades after her death.” Milton H. Greene Archives, Inc. v. CMG Worldwide, Inc., 568 F. Supp. 2d 1152 (C.D. Cal. 2008) (paraphrasing the court’s previous order). The twin rulings set off a flurry of lobbying activity in California and New York. In New York, MMLLC unsuccessfully attempted to get the New York legislature to enact a post-mortem right of publicity. In California, however, MMLLC met with greater success. Senate Bill 771, enacted on October 10, 2007, amended the California statute to allow for testamentary disposition of the right for celebrities who died before January 1, 1985. SB 771 also added subsection (p) to California Civil Code section 3344.1, stating: “The rights recognized by this section are expressly made retroactive, including to those deceased personalities who died before January 1, 1985.” Finally, SB 771 expressly provided: “It is the intent of the Legislature to abrogate the summary judgment orders entered in The Milton H. Greene Archives, Inc. v. CMG Worldwide, Inc., United States District Court, Central District of California, Case No. CV 05-2200 MMM (MCx), filed May 14, 2007, and in Shaw Family Archives Ltd. v. CMG Worldwide, Inc., United States District Court, Southern District of New York, Case No. 05 Civ. 3939 (CM), dated May 2, 2007.”

On January 7, 2008, the district court in the Milton H. Greene Archives case held that under the amended statute, CMG and MMLLC did have standing to pursue a claim for violation of Monroe’s statutory post-mortem right of publicity. Seven months later, however, the same court ruled that CMG and MMLLC were judicially estopped from asserting that Monroe was a California domiciliary at the time of her death. The court noted that Monroe’s estate had consistently taken the position that Monroe was domiciled in New York at the time of her death, in order to avoid California inheritance taxes; that the estate had previously submitted several sworn declarations to that effect; that CMG and MMLLC were in privity with Monroe’s estate; and that having benefited from those representations, they would obtain an unfair advantage if they were now permitted to try to establish otherwise. See Milton H. Greene Archives, Inc. v. CMG Worldwide, Inc., 568 F. Supp. 2d 1152 (C.D. Cal. 2008).

Relying on that order, the district court in New York subsequently held that CMG and MMLLC were collaterally estopped from relitigating the issue of Monroe’s domicile. See Shaw Family Archives Ltd. v. CMG Worldwide, Inc., 2008 WL 4127830 (S.D.N.Y. 2008). Although an appeal was filed in that case, in 2011 the Shaw Family Archives filed for bankruptcy protection, in part as a result of the legal fees that it had incurred. The Archives subsequently cut a deal in which MMLLC would become the exclusive licensing agent for Shaw’s photographs of Monroe in exchange for a guaranteed $3 million in royalties over the five-year term of the agreement. The settlement removed the possibility of a ruling on appeal in the New York case.

MMLLC and CMG pursued their appeal in the Milton H. Greene Archives case in the Ninth Circuit. In the recent decision, the Ninth Circuit affirmed the lower court’s ruling. It systematically reviewed all of the evidence showing that Monroe’s will was submitted for probate in New York, and that during the 40-year probate proceedings, her executors (including Anna Strasberg) had consistently represented that Monroe was domiciled in New York at the time of her death. They took the same position in litigation with the California tax authorities. They supported their position with sworn declarations from many of Monroe’s friends. Strasberg also took the position that Monroe was domiciled in New York in litigation with a purported daughter of Monroe’s, as recently as 2002. The court concluded:

This is a textbook case for applying judicial estoppel. Monroe’s representatives took one position on Monroe’s domicile at death for forty years, and then changed their position when it was to their great financial advantage; an advantage they secured years after Monroe’s death by convincing the California legislature to create rights that did not exist when Monroe died. Marilyn Monroe is often quoted as saying, “If you're going to be two-faced, at least make one of them pretty.” There is nothing pretty in Monroe LLC’s about-face on the issue of domicile. Monroe LLC is judicially estopped from taking the litigation position that Monroe died domiciled in California. Our conclusion in this regard is guided by the need to preserve the dignity of judicial proceedings that have taken place over the last forty years and to discourage litigants from “playing fast and loose with the courts.” [citation omitted]

Because Monroe died domiciled in New York, New York law applies to the question of whether Monroe LLC has the right to enforce Monroe’s posthumous right of publicity. Because no such right exists under New York law, Monroe LLC did not inherit it through the residual clause of Monroe’s will, and cannot enforce it against Milton Greene or others similarly situated.... [emphasis added]

The italicized statement is dicta, since the only party to the case other than the Milton H. Greene Archives who can directly take advantage of the decision was Tom Kelley Studios, Inc., the successor to another photographer’s copyrights in photos of Marilyn. Undoubtedly, however, any other defendant would be able to successfully invoke collateral estoppel to prevent MMLLC and CMG from continuing to litigate the issue of Monroe’s domicile at the time of her death.

As a result of this case, Marilyn Monroe does not have a post-mortem right of publicity under New York law, and her name and likeness have been cast into the public domain. That conclusion, however, is subject to four important caveats:

First, although Monroe’s likeness is now in the public domain as a matter of state law, anyone wishing to reproduce a specific photograph or motion picture of Monroe will still have to negotiate with the owner of the federal copyright in that work. Thus, the decision in the case was more of a victory for the photographers than a victory for the public domain.

Second, although Monroe’s name is now in the public domain as a matter of state law, MMLLC has registered the name “Marilyn Monroe” as a federal trademark for a wide variety of goods and services. Anyone selling similar goods and services will likely face a trademark or unfair competition claim under the Lanham Act. Indeed, if the mark “Marilyn Monroe” is deemed to be a “famous” mark, federal anti-dilution law will protect it from being used even on unrelated goods or services. Potential trademark defendants will have to rely on the descriptive fair use defense in 15 U.S.C. § 1115(b)(4), and be prepared to defend it through a likely appeal.

Third, it is perhaps not inevitable that other states will apply a choice-of-law rule that looks the law of the state where Monroe was domiciled at the time of her death. Indeed, Washington State has a right of publicity statute that purportedly applies to any exploitation of a celebrity’s image in the state of Washington, regardless of domicile. A federal district court, however, has held that the Washington law is unconstitutional. See Experience Hendrix, LLC v. Hendrixlicensing.com, Ltd., 766 F. Supp. 2d 1122 (W.D. Wash. 2011). That ruling will undoubtedly be appealed to the Ninth Circuit. Although it is a common practice to look to the law of the state where the deceased person was domiciled, it is far from clear that it should be unconstitutional for a state to apply its own law to transactions that occur inside that state.

Fourth, MMLLC and CMG continue to lobby the New York legislature to enact a post-mortem right of publicity, and to make it retroactive to celebrities who died before its enactment. Should they succeed in doing so, Marilyn Monroe’s name and likeness will be removed from the public domain and will once again become private property. If that happens, then other potential issues, such as copyright preemption, may have to be litigated in the future.

Posted by Eric at 09:08 AM | Publicity/Privacy Rights | TrackBack

September 21, 2012

Split 9th Circuit Panel Approves Facebook Beacon Settlement – Lane v. Facebook

[Post by Venkat Balasubramani]

Lane v. Facebook, 10-16380 (9th Cir. Sept. 20, 2012)

Facebook’s Beacon initiative has generated more than a few blog posts.

Judge Seeborg approved the class settlement, over the objections of several objectors, including Ginger McCall. The objectors appealed to the Ninth Circuit saying that the settlement should not have been approved. The Ninth Circuit says that approval of the settlement was not an abuse of discretion.

The terms of the settlement were that Facebook would pay $9.5M for a full release of the claims. $3 million of this amount would go to fees and costs of administration. The remaining $6.5 million would go to the “Digital Trust Foundation,” an organization run by a three-member board of directors (Larry Magid, Chris Hoofnagle, and Timothy Sparapani, Facebook’s director of public policy). The organization would also have a legal advisory board which would consist consist of class counsel and counsel for Facebook. No monetary relief would be awarded to the class members, although they could opt-out. Facebook would agree to terminate Beacon, but nothing in the agreement stopped it from re-launching a similar initiative. (Hello, Sponsored Stories 2.0!)

The majority says that appellate review is limited to determining whether there has been a “clear abuse of discretion.” It says that cy pres remedies (where there is the “next best” distribution of the settlement amount – to someone other than the class members) are allowed, and nothing in the structure of DTF causes the cy pres remedy to be improper. As long as the remedy accounts “for the nature of the . . . lawsuit, the objectives of the underlying statutes, and the interests of the silent class members,” that’s all that is necessary.

As to the second objection that focused on the value of the settlement and the district court’s failure to consider the availability of statutory damages under the VPPA, the court relies on the familiar argument that the claims, being privacy claims, are uncertain. There aren’t a long line of cases where plaintiffs have been awarded damages under the Video Privacy Protection Act, and it’s unclear that the claims could be easily brought against Facebook, rather than Blockbuster, an entity that is in a financial quagmire. [There has been a bunch of VPPA activity involving Netflix, Hulu, and Redbox, but no clear wins, and certainly no blockbuster damage awards, for plaintiffs.]

A dissenting Judge Klienfeld tees off on Facebook and on the settlement (and to some extent the class action system in general). He has a long list of problems ranging from expansion of the class to the scope of injunctive relief, to the combination of a “clear sailing” agreement as to fees coupled with no monetary relief to class members. It’s tough to do it justice by recapping it in a blog post, so I would urge readers to check it out for themselves. Here’s a key graf that summarizes his qualms:

In this case, the [class action] process has failed. The attorneys for the class have obtained a judgment for millions of dollars in fees. The defendant, Facebook, has obtained a judgment that bars claims by millions of people victimized by its conduct. So have the other companies involved in Beacon. The victims, on the other hand, have obtained nothing. Under the settlement, Facebook even preserved the right to do the same thing in the future.

Meh. This is an underwhelming result for how long it took for the court to issue its opinion.

The 9th Circuit issued recent decisions on fees (Dennis v. Kellog) and on cy pres settlements (Nachshin v. AOL) that made me think this settlement wouldn’t get its stamp of approval, so perhaps this is a surprising ruling. I wonder whether the objectors will seek re-hearing and whether Judge Kleinfield’s dissent will interest enough interest from other 9th Circuit judges to make that happen. (Judge Seeborg tentatively rejected the proposed settlement in the Sponsored Stories class action: "Judge Seeborg Rejects Sponsored Stories Settlement For Now -- Fraley v. Facebook." This ruling likely paves the way for everyone to clean up the issues he identified in his ruling, and get it approved.)

To me, what makes the settlement problematic is the toothless injunctive relief negotiated on behalf of the class. As Judge Kleinfield points out, as long as it’s called something else, there’s nothing to stop Facebook from launching Beacon 2.0. Even assuming that cy pres is appropriate and it would be impractical to distribute small amounts to class members, I don’t get the sense that this lawsuit will act as a meaningful check on Facebook’s privacy practices, either as to programs such as Beacon, or as a general matter. It’s silly to assume that a non-profit that’s funded by Facebook could achieve this result when third party organizations haven’t been able to do much. (On the other hand, maybe people don’t really care about privacy on Facebook. Although there were some quibbles about the adequacy of notice, of the 3,663,651 class members identified by Facebook, a measly 108 opted out, and 4 submitted written objections.)

See also: New Essay: The Irony of Privacy Class Action Lawsuits (Eric's essay)

Other coverage:

Facebook’s $9.5 Million ‘Beacon’ Settlement Approved (David Kravets/Wired)
Facebook Beacon settlement gets OK (San Francisco Chronicle) (with comments from Greg Beck)
Facebook's Beacon Settlement Upheld By 9th Circuit (Wendy Davis/Media Post)

Posts on Fraley v. Facebook:

Facebook "Sponsored Stories" Publicity Rights Lawsuit Survives Motion to Dismiss--Fraley v. Facebook
Judge Seeborg Rejects Sponsored Stories Settlement For Now -- Fraley v. Facebook

Posted by Venkat at 12:13 PM | E-Commerce , Privacy/Security , Publicity/Privacy Rights

September 13, 2012

Pointing Out Possible Hypocrisy by a Self-Claimed Sextortion Expert Protected by Anti-SLAPP Laws--Backlund v. Stone

[Post by Venkat Balasubramani]

Backlund v. Stone, B235173 (Ca. Ct. App.; Sept. 4, 2012)

When is it OK to tweet a threat to expose seminude photographs of a teenage girl? When you’re a law student? When you’re a self-professed expert on “sextortion”? The answer is: in neither case (if you answered “never,” you’d be right as well).

This is a crazy case involving Christopher Stone, “an aspiring lawyer in his 30’s,” and Alyssa Backlund, who in 2010 was a teenager (it also involves Gawker tangentially; we’ve posted about a few cases involving Gawker, most recently Redmond v. Gakwer).

In addition to being an aspiring lawyer, Stone claimed to be an expert on sextortion. Stone ran a website (stickydrama.com – now down) where he posted a lewd image of a minor female masturbating next to an infant. While the photo was not of Backlund, Stone posted Backlund’s contact information with the image. Separately, Backlund allegedly sent repeated messages to one of Stone’s houseguests. Stone did not take kindly to this and sent a tweet stating:

[m]essage him again, and your floppy titties are spammed all over the place. Last warning.

After Stone sent this tweet, Backlund was interviewed by Adrian Chen of Gawker. Chen’s article initially stated that Stone engaged in “sextortion” by threatening to expose a photo of the underage Backlund, but was later corrected to indicate that Backlund was 18 when the photo referenced in the tweet was taken. Chen referenced the tweet in the article, and also quoted a Fox News report featuring Stone, where Stone warned against the dangers of sextortion. [Chutzpah alert!]

Backlund’s complaint against Stone: This is not relevant to the present motion, but Backlund filed a complaint against Stone for defamation and false light. Stone moved to strike Backlund’s complaint as a SLAPP. He argued that he did not disclose any private facts by posting it. He also argued that he corrected the error in his identification of Backlund as soon as he was apprised of it. (Probably not the best choice of words, but his follow up post was titled “Alyssa Marie Buckland [sic] is Not the Most Vile Camwhore Alive.”) Anyway, the court denied Stone’s motion to strike, finding that “posting child pornography is not protected free speech.” Stone did not appeal this ruling.

Stone’s complaint against Backlund: Stone sued Backlund for defamation and intentional infliction of emotional distress. Backlund moved to strike under the anti-SLAPP statute. The trial court denied the motion, finding that the crux of Backlund’s complaint was not the “public-interest topic of ‘sextortion’,” but Backlund's own comments regarding her experience with Stone. The trial court said that Stone’s defamation complaint involves a “private controversy,” and does not implicate the anti-SLAPP statute. Backlund appealed this ruling, and the court of appeals reverses...and bench-slaps Stone in the process.

Does Stone’s complaint come within the Anti-SLAPP Statute? The appeals court looks to the anti-SLAPP statute and the two possible bases for the motion to strike: (1) the statement was made “in a place open to the public or a public forum in connection with an issue of public interest” and (2) the defamation claim is based on conduct in furtherance of Backlund's right to free speech in connection with an issue of public interest.

The court says that Gawker is a public forum, noting that it’s an internet news site and citing to Stone’s own admission that the articles about him were “viewed by thousands of people.” The key question was whether Backlund's statements were a matter of public concern. The court says yes, noting that Stone injected himself into the public consciousness on the topic of sextortion by portraying himself as an expert (by doing this, “he voluntarily subjected [himself] to inevitable public scrutiny and public ridibule by the public and the media.”). The Gawker article contributed to public discussion on the topic of sextortion and Stone’s own role as an expert. In fact:

publicity about Stone’s threats and Backlund’s resulting fear of Stone provide a cautionary lesson to the youthful readers of Gawker, who might read Chen’s article and decide not to upload nude images of themselves, lest the images fall into the wrong hands and pose the risk of public humiliation in front of countless people.

Yikes.

Does Stone demonstrate a probability of prevailing on the merits? Having concluded that Backlund satisfied the first prong of the anti-SLAPP analysis, the court shifts the burden to Stone to show that he is likely to prevail on the merits. And he fumbles. The court says that he forfeits this prong because he failed to “make [any] argument on appeal to establish that he is likely to succeed on the merits.” He submitted a declaration, but the court dings him because the declaration did not state under penalty of perjury of the laws of the State of California that its contents were true. Because he’s a public figure (in the context of the sextortion discussion), he’s required to show actual malice, and neither his unverified complaint nor his deficient declaration get him there. The court also notes that while Gawker published three separate articles about Stone, Stone chose not to sue Gawker and instead “focused on a teenager to whom he admittedly sent a threatening message. . . . Given Stone’s scurrilous and outrageous behavior toward young women, he cannot be heard to complain when confronted by one of his victims.”
__

Yowza. It’s tough to see what Stone's hook for the defamation claim would have been. He claimed that Backlund’s statements were false because (1) the topless photograph of Backlund was taken when she was 18 (and not underage); (2) his tweet did not include a link to the image of Backlund; and (3) he didn’t “continue to threaten Backlund with posting the picture,” or make similar threats against others. It’s unclear whether the age discrepancy came from Backlund or from Chen, but this isn’t really the crux of the Gawker story, which was that Stone wasn’t the credible expert protecting others against sextortion that he claimed to be: “StickyDrama’s Christopher Stone Is a ‘Sextortion’ Expert in More Ways Than One.” There’s no dispute that he tweeted the threat to expose risqué images of Backlund. Res ipsa loquitur dude.

The case is interesting for a couple of reasons.

First, it affirms that discussions taking place on blogs and online forums are public forums for purposes of the SLAPP statute. A related point is that people who inject themselves into the social sphere will have a hard time arguing non-public figure status. Both points could come in handy for defamation defendants.

Second, the bench-slap. The court is not impressed with Stone. It also drops a footnote telling him that his internet activities are “abusive, unethical, demonstrate a manifest lack of maturity, discretion and good judgment, and mandate a thorough investigation into his fitness for state bar membership.” To the extent he seeks to practice law in California, he is required to provide a copy of the opinion to the State Bar.

Finally, Stone’s poor judgment and over-reach came back to haunt him. As a self-professed expert on sextortion, he should steer clear from any activity that’s even in the same universe, much less the same ballpark. His Tweet ran afoul of this. Additionally, the fact that he didn’t go after Gawker or Chen but instead went after a hapless teenager/young adult was something the court picked up on.

Posted by Venkat at 08:02 AM | Content Regulation , Publicity/Privacy Rights

September 11, 2012

Ongoing Website Editing Doesn't Trump Single Publication Rule--Yeager v. Bowlin

By Eric Goldman

Yeager v. Bowlin, No. 10-15297 (9th Cir. Sept. 10, 2012)

The single publication rule says that the statute of limitations starts with the first publication of the work, and so long as the work doesn't change, further disseminations of that work don't restart the statute of limitations. In Internet cases, courts have consistently interpreted the single publication rule favorably for web publishers. This Ninth Circuit opinion echoes and extends the canon.

In 2008, Gen. Chuck Yeager sued a memorabilia website for publicity rights violations. The court said there was no evidence that the website had changed its references to Yeager since, at the latest, October 2003, putting the lawsuit well outside the 2 year statute of limitations. Prior cases have made it clear that continuing to host content on a website doesn't reset the statute of limitations. Yeager argued that the defendants kept editing and changing their website, even if they didn't change the parts about him, and this ongoing editing reset the statute of limitations. The court rejects the argument:

a statement on a website is not republished unless the statement itself is substantively altered or added to, or the website is directed to a new audience

The first half of the standard is quite defendant-favorable, consistent with the other single publication cases. I don't understand the other language ("directed to a new audience") and it seems like fertile ground for litigation mischief. I imagine the court meant that if the website left the tortious statement intact and changed all of the content around it to create an entirely different meaning, that would be a qualitatively different page that should reset the statute of limitations. But the court's terse statement, without any illuminating explanation, hardly makes that clear. Still, overall, this is a favorable ruling for web publishers.

[remainder of the post removed due to legal threats]

Posted by Eric at 09:00 AM | Publicity/Privacy Rights | TrackBack

August 25, 2012

Judge Seeborg Rejects Sponsored Stories Settlement For Now -- Fraley v. Facebook

[Post by Venkat Balasubramani]

Fraley v. Facebook, C 11-1726 RS (N.D. Cal.; Aug 17, 2012)

We’ve covered the Facebook Sponsored Stories litigation before. It's a putative class action arguing that Facebook improperly used the likeness and personality rights of its users to promote products and services. After extensive negotiations, the parties came to a deal, including (1) injunctive relief in the form of some changes to Facebook’s Sponsored Stories program; and (2) cy pres payment of $10 million. And of course, attorneys’ fees up to a certain amount (Facebook said it wouldn't object to any request up to $10 million). The users did not get any monetary recovery. In considering a motion for preliminary approval for the settlement, Judge Seeborg says no.

He identifies the following issues with the proposed settlement:

- It’s unclear that cy pres is appropriate because it's not clear it would be impractical to distribute the potential settlement payment. The parties argued that it would be impractical to divvy up $10 million among 70 million individuals. The court says this alone is not enough to justify a payout of zero dollars to the class. The outer range of possible class recovery is also something that should be considered, according to the court. If each plaintiff is entitled to $750 in statutory damages, the amount of available damages if the case went to trial may be much greater than the $10 million estimated by the parties.

- The court also questions whether the amount of the cy pres payment is appropriate. The court acknowledges that it’s appropriate to estimate damages and apply a discount, but the number shouldn’t be just “plucked from thin air.” A related problem is that Facebook's estimate assumes a discount based on the small number of plaintiffs who actually file claims. The court says that this gives Facebook a double discount.

- The court balks at the fees – up to $10 million.

- It’s unclear what exactly Facebook is signing up for in terms of injunctive relief. The court wants more information on this.

You don’t get the sense from the order that the settlement is dead. This is basically a warning shot from the court; maybe another way of saying that the parties should come back and dress up their settlement a little more nicely. While courts have scrutinized settlements more closely, cy press settlements are still an acceptable way of handling class action payments.

The court's statement that the lawsuit is "too big to settle" is an interesting one. It's tough to square this conclusion with the settlement number. If the possible range of damages is really that big, does it make sense for plaintiffs to agree to such a discounted amount in settlement? This brings one back to the issue of whether the settlement is in the class' interest. Because the money isn't even going to the class, that's sort of a moot point. (The number that's most important is probably the attorneys' fees figure, which makes the whole thing look like a toll that Facebook pays to plaintiffs' lawyers. Judge Seeeborg doesn't say this explicitly but he hints at it.)

There's a side-dispute about the identity of the cy pres fund recipients, and someone asked the court to expand the circle of entities who would be getting payouts but the court refused. On a related note, Eriq Gardner suggests that rejection of the proposed settlement is a victory for Hollywood because the cy pres recipient organizations are firmly in the anti-content camp: "Why Hollywood Wins in Judge's Rejection of Facebook Privacy Settlement." I think this reads a bit too much into the motivations and pliability of the cy pres recipients.

Most important I think is the scope of the injunctive relief, and this is where the settlement arguably falls short for users. As a previous post on Fraley mentioned, this lawsuit did not put a stop to Facebook's Sponsored Stories initiative. In fact, Facebook is expanding its love affair with Sponsored Stories. You would think any negotiated injunctive relief that addressed changes to this program would allow users to quickly and easily opt-out, but I don't think that's the case. Marc Rotenberg from EPIC made this point in a letter to the court--the letter is well worth reading: Fraley v. Facebook proposed settlement, No. 11-01726 (letter dated July 12, 2012).

There's a final aspect of the settlement that is worth noting: the push for confidentiality around Facebook's revenue figures. While the parties are still wrangling with the court over what exactly can be sealed (Judge Seeborg told the parties to go back to the drawing board on their initial request to seal), the revenue figures for Sponsored Stories should be made available, at least to potential class members. Of course, given the size of the potential class, that's pretty much the same as making it publicly available. It's interesting (and understandable) for Facebook to claim that it shouldn't have to disclose specifics, but people need enough information to meaningfully evaluate the settlement. It would be nice for the court to take a hard look at the parties' request to seal the financial figures.

[A final procedural note, plaintiffs in a separate class action that involved minors moved to intervene in order to object to the settlement. The court said that intervention is moot because the other plaintiffs could file an objection regardless of whether they are parties to the suit. The motion for intervention makes a few points that are worth considering but they didn't get much play in the overall discussion.]

Other coverage:

Eriq Gardner: Why Hollywood Wins in Judge's Rejection of Facebook Privacy Settlement
David Kravets: Judge Rejects Facebook ‘Sponsored Stories’ Lawsuit Settlement
Kash Hill: Judge Kicks Facebook's 'Sponsored Stories' Settlement To The Curb
Jeff John Roberts: "Judge rejects Facebook ad settlement, cites 10 million dollar payout"

Previous posts:

Facebook "Sponsored Stories" Publicity Rights Lawsuit Survives Motion to Dismiss--Fraley v. Facebook

Posted by Venkat at 07:56 AM | Publicity/Privacy Rights

August 11, 2012

Breastfeeding Mom Can Sue Video Producer Despite Signing a Blanket Release--Sahoury v. Meredith

By Eric Goldman

Sahoury v. Meredith Corp., 2:11-cv-05180-KSH-PS (D. N.J. Aug. 2, 2012)

Sahoury consented to being video-recorded while breastfeeding for inclusion in an instructional video. She claims that the video producers orally agreed to two conditions: (1) the instructional video would only be shown on cable TV and the Parents magazine website, and (2) the video would not reveal the full name of Sahoury or her baby. However, she signed a blanket written release that didn't reference either promise. She says the release was presented to her after the taping, as she was in a rush to leave. Sahoury alleges that the producers broke both oral promises by posting the video to YouTube with her full name. She then alleges that rogue actors downloaded the video from YouTube and spliced the video of her breastfeeding into pornographic videos featuring a model who looked like her; and the rogue video referenced her full name and was distributed widely, ruining her vanity search results. To combat this, she hired a reputation management service.

Frustrated by the video producers' lack of pursuit against this rogue distribution, Sahoury sued the video producers. In this ruling, the court largely upholds her lawsuit against a motion to dismiss, mostly based on Sahoury's argument that she relied on the oral promises made by the producers. However, the court dismisses her publicity rights claim because using her name in connection with a freely available instructional video doesn't have enough commerciality.

From a legal drafting standpoint, it's interesting that the signed blanket release wasn't dispositive. The release might still work later in the case, but it didn't knock out the case on a motion to dismiss. She basically gets around the release by arguing procedural defects (presented after the video was shot, as she had to leave quickly to get her kid) and the contrary oral promises. Naturally, video/photo producers should never make oral promises to the depicted people that contradict the written releases. Here, it opens the door for the judge's outrage about Sahoury's treatment.

Putting aside the legal issues for a moment, I'm confused because Sahoury's allegations all rest on a questionable factual premise. It appears she thinks that she could avoid being reidentified if only her first name was used, but obviously this is wrong. As we've seen repeatedly, she could be easily reidentified by third parties in the comments or elsewhere online--especially as facial recognition technology improves. And, the ability of pornographers to extract and remix the video was equally possible if the video was on YouTube, on Parents.com or only shown on cable. In other words, by consenting to the production and distribution of a widely available video showing her breast-feeding, she was vulnerable to the porn splicing no matter what. Finally, as we saw in the Bev Stayart cases, a person's name can be splogged into web pages with adult content even if the person has done nothing supporting that association. So from my perspective, Sahoury never had a chance of achieving her putative objectives.

In light of where she is now, what can she do? (beyond reputation management and suing the initial video producers). She could try to go after the rogue video remixer and the various porn sites distributing the video. She would have to rely on privacy claims, as she doesn't own the video's copyright (more on that in a moment). Further privacy litigation against these third parties isn't likely to be productive. The rogue video remixer and porn sites aren't likely to be easy targets--they could be overseas, they are almost certainly judgment-proof, and there are just too many targets--and the privacy claims will be partially undercut by the wide public release of the initial video.

Similarly, legal efforts against search engines to de-index the porn sites linking to her name aren't any more productive. Bev Stayart has shown this is a losing proposition, and 47 USC 230 would also apply to any privacy-based claims.

In contrast to privacy claims, copyright infringement would provide Sahoury with a real cudgel. This is why we're seeing the troubling hack (most recently blogged in Scott v. WorldStarHipHop) of a photo/video subject acquiring the copyright to the visual depiction of them and then turning into a copyright plaintiff. Something like that would be a logical approach for Sahoury here. She can settle up with the initial video producers, get the copyright to the video or at least the portion with her in it, and then send copyright takedown notices not only to the republishing websites but to the search engines as well. I can't really applaud this approach, as it relies on the unwarranted power of copyrights over other legal claims.

Posted by Eric at 10:47 AM | Copyright , Derivative Liability , Licensing/Contracts , Publicity/Privacy Rights , Search Engines | TrackBack

July 19, 2012

Judge Koh Puts the Kibosh on LinkedIn Referral ID Class Action -- Low v. LinkedIn

[Post by Venkat Balasubramani]

Low v. LinkedIn, 11-CV-01468-LHK (N.D. Cal.; July 12, 2012)

This case involves the fact that LinkedIn put users' unique identifiers into its URLs, allowing advertisers (and others) to associate that unique identifier with users--and, potentially, access the info on their profile pages--when they clicked on a link on LinkedIn. Judge Koh had previously dismissed the case with leave to amend. Low amended his complaint, and the second time around Judge Koh dismisses it with prejudice. Here’s our blog post on the initial dismissal of the lawsuit: LinkedIn Beats Referrer URL Privacy Class Action on Article III Standing Grounds--Low v. LinkedIn.

Standing: citing to Edwards v. First American Corp. and Jewel v. NSA, the court says that plaintiffs have alleged violations of statutory rights as well as (state) constitutional rights and get over the standing hurdle.

Stored Communications Act: Plaintiffs’ claims under the Stored Communications Act claims require the plaintiffs to show that LinkedIn provides either “remote computing services” or “electronic communication services.” The court also says that the analysis looks to whether LinkedIn was acting in this capacity with respect to the particular information that was allegedly wrongfully disclosed. In this case, the court concludes that the LinkedIn was not functioning as a remote computing service with respect to the LinkedIn user ID and URL of the profile pages that the user used to view third party profiles. The unique IDs are created by LinkedIn for its own purposes and are not sent to LinkedIn for storage or processing by plaintiffs.

Invasion of Privacy: The court says that invasion of privacy claims must meet “high standards” for the types of invasion that are actionable—“there must be an egregious breach of the social norms underlying the privacy right.” The court says that disclosure of the LinkedIn ID and the profile page is not the type of information that amounts to a serious invasion. Additionally, although plaintiffs claimed that the information could be used to glean plaintiffs’ browsing history and used to identify plaintiffs, there was no allegation that this actually occurred.

False advertising law: Plaintiffs failed to allege reliance on any purported misrepresentations by LinkedIn. Although one of the named plaintiffs had paid for a premium LinkedIn subscription and satisfied the monetary loss elements, the court still finds that there was no allegation that plaintiffs viewed any representations within LinkedIn’s privacy policy and made a purchasing decision based on these representations.

Breach of contract: Plaintiffs’ breach of contract claims fails because they have not alleged sufficient damages. The sole basis for damages is the loss in value to plaintiffs’ information. The court again reiterates skepticism that this has value in plaintiffs’ hands to begin with, but she says that even if it does, any sort of diminution in value would not be a cognizable form of contract damages.

Other claims: The court also dismisses the claims for conversion (browsing history and personally identifiable information is not property); unjust enrichment (no standalone claim); and negligence (no damages).
__

In his comments to the original post about this case, Eric noted that this was a “low-merit” privacy lawsuit that had little chance of success the second time around. Sure enough, Judge Koh dismantles plaintiffs’ claims and sends them packing.

It’s worth noting that the FTC’s enforcement action against MySpace involved allegations against MySpace that were somewhat similar to the plaintiffs’ allegations against LinkedIn in this case: in both situations, the companies involved allowed third parties to tie the user’s unique identifiers with their public profiles. (See Ed Felten’s blog post on the MySpace settlement--"Syncing and the FTC's MySpace Settlement"):

What made the possible syncing problematic in the case of Myspace was that (1) Myspace enabled ad networks to use Myspace’s Friend ID pseudonym to get personal information about the associated user, and (2) Myspace promised its users that it would not share that personal information with third parties.

The FTC has been increasingly aggressive in its enforcement actions around the privacy practices of online entities. While the court ruled that LinkedIn could not be held liable in a civil lawsuit brought by plaintiffs, it’s an open question as to whether these practices could land it in the crosshairs of the FTC.

Other coverage:

InsidePrivacy: Low Case Against LinkedIn Dismissed In Its Entirety
FourthAmendment.com: N.D.Cal.: LinkedIn not a remote computing service and does not provide electronic communication services, so it can't be sued under SCA

Posted by Venkat at 08:57 AM | Licensing/Contracts , Marketing , Privacy/Security , Publicity/Privacy Rights

July 06, 2012

The "I Didn't Understand Facebook's Privacy Settings" Argument Isn't Persuasive to Judges--Sumien v. CareFlite

By Eric Goldman

Sumien v. CareFlite, 2012 WL 2579525 (Tex. App. Ct. July 5, 2012). Appellate court docket.

Sumien and Roberts were CareFlite EMTs. Roberts posted on a third employee's Facebook wall how she wanted to slap a patient. Responding to pushback on that post, Roberts subsequently posted to her Facebook wall (presumably as a status update, although the court doesn't clarify that):

Yes, I DO get upset on some calls when my patient goes off in the house and I have to have a firefighter ride in with me because I fear for MY own safety. I think that is a valid excuse for wanting to use some sort of restraints. Just saying.

To which Sumien replied in a comment (thus readable to at least Roberts' friends):

"Yeah like a boot to the head.... Seriously yeah restraints or actual HELP from PD instead of the norm."

The opinion doesn't clarify exactly who was Facebook friends with each other, but at minimum Roberts and Haynes were friends, and Haynes was the sister of Calvert, CareFlite's compliance officer. The court says Haynes complained about the post. Haynes read Sumien's comment on Roberts' Facebook wall and then delivered Sumien's contents to Calvert. If Calvert and Roberts were friends (or if Roberts' wall was open to the public), Calvert also could have checked out Sumien's comments directly.

CareFlite subsequently fired both Roberts and Sumien. While Roberts' patient-slapping reference may have been troubling (it wasn't quoted in the court opinion), I don't see anything obviously problematic in Sumien's comment. The grammar makes it clear that the "boot to the head" reference was a joke (maybe not that funny, but I can see how it tried) and complaining about the workplace conditions seems like the kind of thing that the NLRB is hyper-sensitive about. I have to imagine there's a backstory to the employer's issues with Sumien. Otherwise, if this is the worst Sumien did, the employer apparently overreacted.

Sumien sued CareFlite for wrongful termination and privacy invasions. The lower court dismissed all of the claims. This ruling only addresses Sumien's appeal of his intrusion into seclusion claim (which appears to be the only issue Sumien appealed...?). The court efficiently rejected all of Sumien's arguments.

Sumien tried two arguments (his privacy interest in discussing patient issues outweighs public interest in disclosure; he can't be fired for discussing workplace issues online) that the court says are irrelevant to the intrusion into seclusion claim. Then, Sumien tries a last-ditch "I'm clueless about Facebook" argument:

Sumien contends that CareFlite intruded upon his seclusion because he did not realize that Roberts’s Facebook “friends” could view the comment that he posted on Roberts’s “wall.”

The court doesn't care, saying Sumien

did not present any evidence to show that his misunderstanding meant that CareFlite intentionally intruded upon his seclusion

Intrusion into seclusion claims are often weak, and it was a poor fit for this situation. The ruling reminded me a little of the court's rejection of Moreno's privacy claim in Moreno v. Hanford Sentinel, where Moreno posted a screed to her low-visibility MySpace page that had unrestricted public access, to which the court said that she had no privacy interest in that effectively public venue.

There are several lessons to reiterate here:

1) Not all communication platforms are equally appropriate for every discussion. If you don't understand how the communication platform works, don't use it for anything you don't want the world to know! Instead, stick to DMs or email, and recognize that even then "private" messages have a knack of leaking out to the wrong people.

2) In particular, commenting on someone else's Facebook status report is not a private communication to that person. That should be obvious to even casual Facebook users, but apparently Sumien didn't get it.

3) People in the healthcare industry (broadly conceived) should be especially careful about discussing patient-related matters in any online venue. We've seen problems with online discussions by people in the healthcare industry literally from cradle (Yoder, Byrnes) to grave (Tatro).

* Accessing an Employee's Facebook Posts by "Shoulder Surfing" a Coworker's Page States Privacy Claim -- Ehling v. Monmouth Ocean Hosp.
* Facebook "Likes" Aren't Speech Protected By the First Amendment–Bland v. Roberts
* Facebook Posts Complaining About Supervisor Conduct do Not Support Retaliation Claim – DeBord v. Mercy Health System
* Employee Wins Harassment Claim Based in Part on Co-Workers' Offsite Blog Posts
* Overreactive Guidance for Social Networking Du Jour -- NLRB Edition
* Private Employers and Employee Facebook Gaffes [Revisited] and the prior post Do Employers Really Tread a Minefield When Firing Employees for Facebook Gaffes?
* School District Didn't Violate First Amendment for Reassigning Teacher Who Blogged--Richerson v. Beckon
* Employee Blogging Risks

Posted by Eric at 11:03 AM | Content Regulation , Privacy/Security , Publicity/Privacy Rights | TrackBack

June 25, 2012

Wisconsin Appeals Court Punts on the Legality of Buying People's Names for Keyword Advertising--Habush v. Cannon

By Eric Goldman

Habush v. Cannon, 2012 WL 2345137 (Wis. App. Ct. June 21, 2012). The case record. My prior blog post on this case.

You may recall this case. Habush Habush & Rottier and Cannon & Dunphy are both leading personal injury law firms in Wisconsin. The Cannon firm bought the names "Habush" and "Rottier" as keywords for its competitive keyword ads. Habush and Rottier then sued the Cannon firm and its principals for violations of Wisconsin's publicity rights statute. To my knowledge, this is the only pending lawsuit over keyword advertising triggered by a person's name, and there's no direct precedent on point. Furthermore, the publicity rights doctrine is so under-theorized that no one really knows how to define its boundaries. Because of the doctrinal morass and the technological underpinnings, this case is giving judges fits. The lower court judge ruled for the defense but wrote an odd opinion, and basically expressed resignation knowing that he was going to be appealed no matter what he ruled.

The appeals court didn't want this case any more than the lower court judge did. This led the appeals court to do something highly unusual: instead of trying to resolve the case or even make any progress sorting through the issues, the appeals court simply punted the case to the Wisconsin Supreme Court. The procedural move is that the appeals court "certified" the issues to the Supreme Court, but let's be honest--the appeals court was so obviously flummoxed by this case that it simply kicked the case upstairs without even trying.

I've seen this procedural move before, but usually it's a federal district or appellate court certifying a question of state law to the state Supreme Court. I can't recall the last time I saw a state appellate court simply deem a case a "hot potato." On the other hand, the appellate court knew (like the lower court judge) that these litigants (being litigators, after all) were going to appeal its ruling no matter what it ruled, so this case is destined for the Wisconsin Supreme Court eventually. The appellate court's punt just speeded that denouement up.

The Supreme Court doesn't have to accept the certification; for example, the Supreme Court could tell the appeals court to try again. But assuming the Supreme Court accepts the certification, it will set up a major publicity rights showdown at the Wisconsin Supreme Court. I'd expect numerous amici would offer up some guidance to the Wisconsin Supreme Court; I probably would participate in some brief in support of the defense.

The appeals court offered four weak explanations why it thought it was better to punt the case than try to resolve it:

* "the Wisconsin Supreme Court has not yet interpreted WIS. STAT. § 995.50 in any context even generally resembling this one, much less addressed specific features of § 995.50(2)(b) in the context of now pervasive Internet search engines"
* "until recently, the following activity did not exist: keyword-triggered advertising that uses “sponsored” web page links to draw the potential attention of millions of Internet users who navigate from search-engine results to web pages"
* "“Developing” a “common law of privacy” is not the primary function of the court of appeals." [Seriously???]
* "any decision on these issues may have widespread and significant ramifications for many individuals and businesses in Wisconsin and beyond its borders"

Frankly, I thought the appellate court made good arguments why it should have ruled on the case on its docket, not punted it.

Posted by Eric at 08:44 AM | Publicity/Privacy Rights , Search Engines | TrackBack

June 04, 2012

"Hot Topics in Internet Law" Talk Slides

By Eric Goldman

This weekend I presented on "Hot Topics in Internet Law" at the San Francisco IP Law Association's Spring Seminar in Healdsburg. My talk slides. A few photos from the trip. As I've mentioned before, I find "hot topics" talks unusually challenging to prepare--they take much more time than normal talks, they are hard to organize, and they have a high risk of preemption by prior speakers. In addition to quick coverage of a number of topics, I focused on 5 broader topics (I only addressed 3 in the time I had):

* intermediary deputization
* consumer reviews
* social media account disputes
* trolling
* new gTLDs

Posted by Eric at 02:24 PM | Copyright , Derivative Liability , Domain Names , Publicity/Privacy Rights , Trade Secrets , Trademark | TrackBack

May 14, 2012

The Dangerous Meme That Won't Go Away: Using Copyright Assignments to Suppress Unwanted Content--Scott v. WorldStarHipHop

By Eric Goldman

Scott v. WorldStarHipHop, Inc., 2012 WL 1592229 (S.D.N.Y. May 3, 2012)

Copyright law wasn't designed as a privacy enhancing doctrine, but sometimes plaintiffs try to repurpose copyright law anyway. This case is an interesting illustration of how copyright law might be used to reverse-engineer a right to forget, using legal tactics not dissimilar to those advocated (and later renounced) by Medical Justice. As such, this case provides an early warning sign of an emerging attack on publicly available truthful information using copyright law chicanery.

In November 2010, Scott's girlfriend and ex-girlfriend got into fisticuffs in a classroom. Scott joined in the melee and hit his ex-girlfriend multiple times. A classmate, Seymour, videotaped the altercation. Seymour then sent the video to the WorldStar website, which posted the video as "Disgraceful: College Fight In NYC Breaks Out Between A Guy, His Girl & Another Girl In Class! (Man Strong Arm's The Student. Hitting Her With Body Shots)." Unfortunately, the opinion is cryptic about whether Seymour posted the video directly or submitted the video to WorldStar for their posting--it would make a difference to the copyright analysis. The video appears to be offline now.

Then, things get really interesting. In December 2010, Seymour assigned the video's copyright to Scott. The opinion doesn't say why. It could be that Scott paid Seymour for this assignment as a cheap way to get legal control over the video; or it could be that Scott coerced Seymour into transferring the copyright to settle a lawsuit threat. Once armed with the copyright, Scott sent 512(c)(3) takedown notices to the websites hosting or linking to the video. See, e.g., this one to Twitter. Scott sent a defective takedown notice to WorldStar, which didn't respond in 12 days, at which point Scott sued. WorldStar brought a 12(b)(6) motion to dismiss. The court rejects the dismissal motion for the copyright claim and grants it for the publicity rights claim.

Copyright. WorldStar argued that Seymour granted it a license to the video before Seymour's copyright transfer to Scott, and thus Scott's acquisition of the video was subject to the then-existing license. The court rejects this argument because WorldStar didn't adequately show it had the required written license (required by 17 USC 205(e) necessary to withstand a subsequent acquisition).

This reinforces the importance of the facts around how WorldStar obtained the video. The opinion doesn't indicate if Seymour clicked through a mandatory non-leaky clickthrough agreement. If WorldStar used a mandatory non-leaky clickthrough agreement, then I'd argue (per UETA/E-Sign) that in fact there was a written license agreement in effect before the Seymour-Scott transaction. However, for WorldStar's argument to work, the license would need to be irrevocable. Otherwise, even if the license survived the acquisition, Scott can simply revoke the license post-acquisition. So while I think most UGC websites will have a "written" license sufficient to withstand the 205(e) attack, I think most UGC websites also don't have strong enough EULA provisions about retaining UGC once posted to avoid this attack. Note that users' rights to remove the videos they uploaded might be located in either the EULA or privacy policy, so both documents would need to be reviewed to reach a conclusion.

WorldStar also argued that Scott sent a defective 512(c)(3) takedown notice, and thus it never got the requisite knowledge of infringement. However, WorldStar didn't argue that it requested Scott resubmit a compliant notice as possibly required by 512(c) (given the nature of the alleged notice defects), and thus WorldStar can't get a 12(b)(6) dismissal on this point.

Publicity Rights. Scott's New York state publicity rights claim fails because Scott didn't allege WorldStar used the video for advertising purposes, and WorldStar's other activities were protected under the state law's newsworthiness exception. While dismissal is the right outcome, relying on the newsworthiness exception is a little disquieting. The newsworthiness exception applies often in content lawsuits (see, e.g., Parisi v. Sinclair and the trademark case BidZirk v. Smith) but not always. See Fraley v. Facebook as an example of how the newsworthiness exception has its limits. A much better grounds for dismissal would be the lack of commerciality in the video; Seymour had no obvious commercial interest in the video, and WorldStar had no more commercial interest in the video's "editorial content" than an ad-supported newspaper has a commercial interest in its editorial content.

Implications. This lawsuit provides a protocol for folks trying to suppress truthful negative information--acquire the copyrights to the content containing the unwanted information, and then use the newly created threat of copyright infringement to force that information off the Internet. While this is a disconcerting protocol, it probably won't work in all circumstances. For example, the protocol probably works better for visual/aural content than purely textual content because (a) people need to see/hear some things with their own eyes/ears, and (b) it's much easier for others to extract and repeat textual information without running afoul of copyrights. Nevertheless, the post-publication acquisition protocol works even better than Medical Justice's now-retired pre-publication acquisition approach because it doesn't rely on legally dubious pre-assignments of not-yet-extant works, plus it can be activated only in response to specific problematic content. Thus, we need to vigilantly monitor the ecosystem for potential abuses of this protocol.

UGC sites (and especially review sites) could undercut the protocol by restricting users' ability to take down content in response to legal duress. Ripoff Report famously provides its authors with no power to delete their reviews, an aggressive and sometimes questionable move that does avoid the problems identified here. If a blanket restriction on users' editing/deleting of their own content is too strong, UGC sites could limit this attack by restricting editing/deleting if the author assigns/transfers the copyright in the work, i.e., a kind of springing conditional irrevocability to the user's license to the UGC site if the user transfers the copyright. I doubt many UGC sites will undertake such an effort now, but if we see widespread misuse of the protocol, UGC sites should undertake more drastic measures to preserve their sites' integrity.

For more on the social values that this protocol threatens, see my essay on the Regulation of Reputational Information.

UPDATE: The Katz v. Google lawsuit appears to be in the same genre.

Posted by Eric at 09:15 AM | Content Regulation , Copyright , Derivative Liability , Licensing/Contracts , Publicity/Privacy Rights | TrackBack

April 25, 2012

Misuse of Family Photograph by Photo Studio Supports Misappropriation Claim--Lee v. Picture People

[Post by Venkat Balasubramani]

Lee v. The Picture People, Inc., K10C-07-002 (RBY) (Del. Sup. Ct.; Mar. 19, 2012)

Plaintiffs had their two year old’s picture taken at The Picture People, a store engaged in the business of family photography. At checkout, the photographer asked plaintiffs if they would consent to use of one of the pictures in a contest the photographer intended to enter. Plaintiffs said no, and declined to execute the consent form that they were presented with. Although this was an in-person transaction, The Picture People’s website had a privacy policy that said The Picture People would keep any information provided by customers in connection with their use of online services secure. About a year later, plaintiffs discovered that The Picture People provided one of the pictures to their child’s day car center for advertising purposes. After plaintiffs complained, The Picture People confirmed that it did not obtain consent to use the picture and advised that it would erase all of the images from its system. Plaintiffs brought suit, alleging a potpourri of claims, on their own behalf as well as on behalf of their child. The Picture People moved for summary judgment on all claims.

Privacy claims: The court denies summary judgment as to the child’s misappropriation claim. The basic elements of appropriation without consent were satisfied. Interestingly, there is no evidence that the daycare center actually utilized the images, and the court focuses on The Picture People’s allegedly improper “distribution” of the images. The court dismisses the child’s intrusion claim, finding that the child (through the parents) consented to be photographed. In any event, the court says that use of the pictures in this manner would not be offensive to the reasonable person. (??) The court also dismisses the false light claim, finding that there was nothing false about the use of the photos. Finally, the court grants summary judgment on the parents’ own tort claim, finding that they cannot directly assert the claims of their child (whose claims proceed anyway), nor could they assert a claim for emotional distress absent physical harm, or a showing that there were in the “zone of danger.” Bottom line: the child’s publicity-rights claims go forward, and the remaining claims, including the parents’ claims in their own right, are dismissed.

IIED claim: The court dismisses the intentional infliction of emotional distress claim, finding that (1) the conduct would not be viewed as outrageous by the reasonable person and (2) in any event, plaintiffs failed to satisfy the pleading requirements for emotional damages from torts (they did not suffer injury and were not in the “zone of danger”).

Warranty claims: The court dismisses plaintiffs’ warranty claims. With respect to express warranties, the court finds that any statements on The Picture People website and in its privacy policy did not relate to the “goods” in question. The court also finds that there is no breach of implied warranties because the implied warranties, if any, relate to the quality of the products (the photographs) and do not impose a warranty regarding the use or misuse of the photographs. Plaintiffs also sought to tack on a breach of the duty of good faith but the court says this does not support an independent cause of action. Plaintiffs’ claims sound more in tort than in contract so the warranty claims fail. The court also dismisses plaintiffs’ claims under Delaware consumer fraud act and a statute that prohibits the knowing or reckless distortion of the terms of a contract. The court says that there is no evidence that The Picture People engaged in any sort of deception, or attempted to obscure or distort the terms of a consumer contract. The Picture People may have misused the photograph, but it didn’t make any representation to plaintiffs otherwise (i.e., there was no deception involved). Neither the privacy policy (which clearly did not speak to use of the photograph) nor the request that plaintiffs sign a consent form turned The Picture People’s alleged misuse of the photograph into a fraudulent or misleading act.

A reminder to parents: when you have photographs of your children taken, you may be called upon to negotiate agreements with personality and publicity rights provisions. The parents in this case smartly declined to sign the waiver, although the waiver probably would not have insulated The Picture People’s alleged conduct in this case.

[Eric's comment: Good grief, you can't even go to the mall anymore without fretting about IP rights.]

Plaintiffs made a valiant effort to rope in The Picture People's privacy policy to bolster their contract and warranty causes of action, but this ended up being a bust. In the online ad-tracking and the Facebook cases, the applicable privacy policies end up being relevant because they arguably covered the information collection and use in question; they may also provide the basis for consent. Neither was the case here. Nevertheless, it’s interesting to see this lawsuit play out similarly to other privacy lawsuits. Publicity rights violations seem to be the most viable cause of action. (See, for example, Fraley v. Facebook, discussed in Eric's blog post here: "Facebook "Sponsored Stories" Publicity Rights Lawsuit Survives Motion to Dismiss--Fraley v. Facebook.") Here, if the evidence ultimately shows that the daycare center never actually used images the question, plaintiffs' claims will get kicked. The remaining causes of action are fairly anemic at best, and in this case ended up being dismissed altogether.

Posted by Venkat at 09:07 AM | Licensing/Contracts , Publicity/Privacy Rights

April 16, 2012

Terminating an NFL Player's Endorsement Agreement for Polemic Tweets May Be Contract Breach--Mendenhall v. Hanes

[Post by Venkat Balasubramani, with comments from Eric]

Mendenhall v. Hanesbrands, 2012 WL 1230743 (M.D.N.C.; Apr. 12, 2012)

This case has it all: Twitter, a pro football player, terrorism, Osama bin Laden and contract law geekiness!

Background: Rashard Mendenhall plays professional football as a running back for the Pittsburgh Steelers. Mendenhall entered into an endorsement contract with Hanesbrands, which owns the Champion brand. The agreement between Hanesbrands and Mendenhall had a “morals clause,” which originally said that Hanesbrands could terminate the agreement if Mendenhall was arrested, charged with, or indicted for a felony or a crime involving moral turpitude. This clause was later amended to provide that Hanesbrands could terminate the agreement if, in addition to being charged with or indicted for a crime, Mendenhall:

[Became] involved in any situation or occurrence . . . tending to bring Mendenhall into public disrepute, contempt, scandal, or ridicule, or tending to shock, insult, or offend the majority of the consuming public . . . . [Hanesbrands’] decision on all matters arising under [this section] shall be conclusive.

Mendenhall’s Tweets: Mendenhall is an avid user of Twitter (@R_Mendenhall) and describes himself as a “Conversationalist and Professional Athlete.” [Eric's note: sadly, the conversation stopped pretty much right after Mendelhall sued Hanes; his last post is from July.] In the wake of President Obama’s announcement of Osama bin Laden’s assassination, Mendenhall posted a series of Tweets decrying the joy that people expressed about this incident (a link to the first tweet in the series):

What kind of person celebrates death? It’s amazing how people can HATE a man they never even heard speak. We’ve only heard one side . . .

I only believe in God. I believe we’re ALL his children. And I believe HE is the ONE and ONLY judge.

Those who judge others, will also be judged themselves.

For those of you who said we want to see Bin Laden burn in hell and piss on his ashes, I ask how would God feel about your heart.

There is not an ignorant bone in my body. I just encourage you to #think [nice touch on the hashtag here]

Not surprisingly, Mendenhall’s tweets generated a negative reaction. Mendenhall issued an explanation, saying that he was encouraging people to think; his tweets were meant to “generate conversation.”

Hanesbrands issued a public statement to ESPN distancing itself from Mendenhall’s statements and saying that his statements were inconsistent with the Champion brand. It said it was terminating the endorsement contract. Mendenhall sued, asserting that Hanesbrands’ termination was a breach.

The Court’s analysis: Hanesbrands says the contract vested it with discretion to terminate the agreement, and this decision shouldn’t be second guessed by the court. The court disagrees and says that this discretion is constrained by Hanesbrand’s duty of good faith and fair dealing. (The court doesn’t explicitly say that the contract would suffer from illusoriness if Hanesbrand could terminate it for any reason, but this is the same reasoning we’ve seen in other agreements that give one party a free hand to alter the terms.)

Does Mendenhall get past the good faith hurdle—can he show that Hanesbrands’ actions were unreasonable or in bad faith? At the pleading stage, the court says yes: and points to Hanesbrands initial public statement said that it “disagreed” with Mendenhall’s statements. In contrast, the agreement requires that Mendenhall make a statement that brings him into disrepute or shocks the majority of consuming public.

Hanesbrands responded that there was no dispute Mendenhall’s statements caused a public outcry and this backlash justified its termination of the agreement. The court says there is a factual dispute about the extent of the backlash. Mendenhall submitted evidence that although many people freaked out, he received supportive tweets and some people even changed their minds, thanking Mendenhall for making them think about the situation.

Celebrities and athletes getting into hot water over incendiary tweets that are sent in the heat of the moment. Sound familiar?

I do think there’s more to the story here, though. I don’t deal with morals clauses with much frequency, but it’s interesting to see that even a morals clause has to be constrained by some standard. If the brand reserves for itself the right to freely terminate the contract any time the endorser says something the brand disagrees with, this raises the problem of the contract being illusory.

Unlike the government, which has to comply with First Amendment constraints, private employers and brands can freely restrict the speech of their employees or endorsers. (Employers have to deal with NLRB guidelines, but those were not implicated here.) The challenge is to come up with a standard that doesn’t tie the hands of the brand but at the same time provides some metric that is not totally subjective and does not give the brand unbridled discretion.

Mendenhall’s path to victory will not be an easy one. He has a pretty tough hurdle to prove that either (1) Hanesbrands tolerated his own previous statements and this established some sort of course-of-dealing, or (2) Hanesbrands tolerated similar statements of other endorsers. As to the underlying issue of whether his tweets were offensive to a large segment of the population, the parties will probably both present competing evidence, but Hanesbrands probably has a lot to drawn on from an evidentiary standpoint here. (It's unclear as to whether use of the term "majority" in the agreement will come back to haunt Hanesbrands.)

In the meantime, Tweeters beware. We don't need another cautionary tale to remind us that the ability to instantly publish our often emotional reactions to the current goings on is a double edged sword, but regardless of how it plays out, this case serves that purpose.
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Eric's Comments

I love love LOVE this case! It's an instant Contract Law classic. I could see the opinion, or its facts, appearing in Contract Law casebooks and courses throughout the country. In addition to the star power/pro sports angle, it's a rich springboard for intellectual pursuits:

* the value of endorsement contracts. There is significant literature questioning whether endorsement contracts are profitable for advertisers. See, e.g., AdAge, Celebrities in Advertising Are Almost Always a Big Waste of Money. When the endorsement arrangement does work out financially, I wonder if being controversial subtracts, or enhances, the endorser's value? It brings to mind the maxim "there's no such thing as bad press." Did Mendenhall's endorsement become less financially valuable after all of the press coverage he got--or more?

In Tiger Woods' case, it could be argued that Tiger Woods' brand fell so hard so fast that it instantly tainted any other brands it touched. Perhaps that's true, but his case was exceptional because he had manufactured a strong "good guy" brand before the ugly dirt got publicized. Here, I wonder if Rashard had such a strong brand that he had as far to fall...and if not, if the enhanced public recognition he got from the controversy outweighed any negative associations in consumers' minds.

* how to negotiate a morals clause in the Twitter age. When I taught 1L Contracts in 2005, I gave students a three-part skills exercise involving negotiating a morals clause. (See this page for links to the exercises and my writeups). My hypothetical was based on Tiger Woods before we learned about his sexual predilections. Tiger's ultimate fall from grace really closed the circle for those students. Thanks for the extra help with the pedagogy, Tiger!

I thought the skills exercise was effective for a number of reasons, including the fact it required students to think about how to describe normal social interactions in words. Students soon realized how our everyday foibles could have massive financial impact in the context of an endorsement agreement. I hope this lesson served them well as lawyers, because the financial downsides of our foibles applies even to us non-celebrities.

The Twitter overlay puts even more pressure on drafters of morals clauses. I love Twitter, but one of its downsides is that very smart people make ill-advised posts in the heat of the moment. (I'm not saying Rashard's posts were ill-advised--see below).

Recall, for example, how Aflac terminated Gilbert Gottfried for his tweets about the Japanese tsunami--his jokes were insensitive but timely, perhaps the most toxic brew (i.e., the same jokes told a few months later might have been less controversial, but partially because they would be divorced from the context). Or recall Ashton Kutcher's ill-timed and ill-informed remarks about the Penn State sexual abuse scandal, that were enough to temporarily kibosh Kutcher's otherwise irrepressible tweeting and induce him to get a spokesperson to handle tweeting for him.

Inevitably, celebrities' tweeting in near-real-time on current events will result in train wrecks. Without a buffer/editor to insulate the celebrity, the celebrity's direct access to his/her audience + Twitter's low-friction posting + working at Internet speed = trouble. Attorneys representing celebrities negotiating morals clauses should incorporate a "Twitter exception" to the clauses, i.e., give the celebrities a free pass for being themselves on Twitter, because that's what's going to happen no matter what the contract says. This may sound like a clause advertisers would strenuously resist, but perhaps they shouldn't. Twitter is often a big part of the celebrity's flywheel of public visibility and the value the celebrity brings to the contract, so advertisers need to give celebrities breathing room to keep tweeting to keep that flywheel turning and deliver the value sought by the advertiser.

* can endorsement contracts draft around the "implied covenant of good faith and fair dealing"? Recall that the contract clause says "[Hanesbrands’] decision on all matters arising under [this section] shall be conclusive." This raises the issue of whether the implied covenant of good faith and fair dealing can be contractually waived. (Ken Adams has covered that issue several times, somewhat inconclusively: see, e.g., 1, 2, 3). Hanes surely thought it had been waived. If Hanes lacked that unilateral discretion, the contract clause (almost certainly the product of spirited negotiation) raises some interesting evidentiary questions--most obviously, how either party could prove/disprove that Mendenhall did something "tending to shock, insult, or offend the majority of the consuming public." (Emphasis added). Does a party need to do some kind of large-scale sampling survey to establish the "majority" threshold? That sounds expensive.

[UPDATE: Frank Snyder has more to say about the lack of doctrinal novelty in this case.]

* political orthodoxy and terrorism. At the core of this case--superficially about pro football players and sports jerseys--is one of the most burning political and philosophical questions of this decade: was the United States' killing of Osama bin Laden legitimate and ethical? The government's PR machine did a wonderful job of demonizing bin Laden for a decade, so perhaps not surprisingly a consensus/orthodoxy emerged: of course it was justifiable to kill bin Laden because he was the face of evil.

To Mendenhall's credit, he challenged this orthodoxy and prompted some hard questions about the US government's own conduct and our own emotional response to bin Laden's death. One way of reading the court's opinion is that it wanted to know more about Hanes' condemnation of Mendenhall for asking tough and probing questions, however contrarian they may be.

I think it's this extra layer that makes it an especially wonderful teaching case. Getting students to question their assumptions about bin Laden's death, and its implications for an otherwise garden-variety commercial dispute, could yield some powerful pedagogical payoffs.
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Venkat's Follow-up Comments

As always, Eric's comments raise a bunch of interesting questions.

The suggestion to build in a "Twitter exception" to a morals clause is a good one, but is sure to encounter stiff resistance from any advertiser or brand. In fact, even raising the issue could send up red-flags and result in pushback. The whole point of a morals clause is for the brand to make the call when things take a short or long-term turn for the worse.

As Eric notes, Mendenhall raised questions about the orthodoxy, and did so in a pretty even-keeled way. Should he take a financial hit because people reacted negatively? For better or worse, this is what being a brand spokesperson is all about. You no longer get to weigh in freely on current affairs and have to be careful about what you say. Everyone pretty much agrees there was strong negative reaction to the tweets. I don't know that it makes much sense to have either side quantify this or conduct an expensive survey. I also don't know whether it makes sense for Hanesbrands to have to meet some numerical threshold to make its case. The tie should go to the brand, and not the athlete or celebrity. (It's worth noting that the data is readily available and it would be fairly easy to categorize every single online reaction to Mendenhall's tweets.)

Unless the trial is scheduled to take place in Berkeley (California), Mendenhall is unlikely to receive any help in front of the jury, who will be colored by their own views in determining whether Mendenhall's tweets were "shocking, insulting, or offensive to a majority of the consuming public."

I wonder what the prospects are for the parties to make up. How likely is it that we see an act of contrition on Mendenhall's part after which the parties resume their relationship? This assumes that Mendenhall is open to this, and it's quite possible that he's not willing to publicly apologize or retract his statements. Judging from his statement in the wake of the controversy, the answer may well be no. On the other hand, maybe Hanesbrands does not need a public apology. Perhaps our memories are, like our attention spans, getting shorter. It's possible that the public may have already forgotten about this incident.

Posted by Venkat at 09:09 AM | Licensing/Contracts , Marketing , Publicity/Privacy Rights , Trademark

March 29, 2012

Lawsuit Against Avvo for Lawyer's Profile Dismissed as SLAPP--Davis v. Avvo

By Eric Goldman

Davis v. Avvo, 2:11-cv-01571-RSM (W.D. Wash. March 28, 2012). Avvo's post when the lawsuit was initially filed.

Florida lawyer Larry Joe Davis, Jr. claimed that his Avvo profile misrepresented his practice. He sued Avvo in Florida for false advertising, publicity rights misappropriation and unfair trade practices. Avvo invoked the forum selection clause in its user agreement to successfully transfer the case from Florida to Washington. In this ruling, the court finds the lawsuit is a SLAPP and dismisses the case. Further, per Washington's anti-SLAPP statute, Avvo will get its attorneys' fees plus a $10k bonus. In other words, another lawyer-plaintiff will be writing a large check to the defense for a lawsuit he never should have brought.

The court first finds that a lawsuit over providing information to the public to help them choose professional service providers constitutes "an action involving public participation.” The court treats this as self-evident, but as I've documented before, California courts (for anti-SLAPP purposes) don't automatically treat consumer reviews as matters of public concern even though I think they should. It's good to see this court recognize the social importance of providing information that guides the marketplace's invisible hand.

Once Avvo made that threshold showing, the burden fell on Davis to show his prima facie case, which he failed to do. On the crucial question of whether Avvo's allegedly wrongful activities occurred in "trade or commerce," the court says Avvo's ad-supported listings are not sufficiently commercial, citing Avvo's 2007 win in the similar Browne case.

The key to this ruling is that Washington's anti-SLAPP law is more robust that Florida's mostly toothless anti-SLAPP protection. Had Avvo not been able to transfer the case to Washington and get its choice-of-law provision enforced, it probably still would be litigating the case and burning its cash. This story turned out well for Avvo, but the case nevertheless highlights the potential deficiencies of some states' anti-SLAPP laws. This is another reason why we need federal anti-SLAPP protection.

Posted by Eric at 08:16 AM | Content Regulation , Marketing , Publicity/Privacy Rights | TrackBack

March 16, 2012

Facebook's "Browsewrap" Enforced Against Kids--EKD v. Facebook

By Eric Goldman

E.K.D. v. Facebook, Inc., 3:12-cv-01216-JCS (S.D. Ill. March 8, 2012). The complaint.

This opinion reaches two interesting conclusions. First, it says children-users can't disaffirm Facebook's terms of service (TOS) so long as they keep using the site. Second, it says the children-users are bound to Facebook's TOS even though the court thinks it's a browsewrap. Neither ruling is unprecedented, but both rulings represent a very favorable bounce for Facebook. Yet, for reasons I'll address in a moment, I'm not 100% clear why Facebook wanted this outcome.

Background. This is one of at least three publicity rights lawsuits brought over Facebook's Sponsored Stories. EKD was filed in the Southern District of Illinois. The other two I know of are JN v. Facebook (in EDNY) and Fraley v. Facebook (in N.D. Cal.). JN and EKD both involved children-users of Facebook as plaintiffs. The JN case was voluntarily dismissed last August. A related case, Cohen v. Facebook, related to Facebook's use of users' names/photos in Facebook's "friend finder" service. In October, Facebook won the Cohen case for lack of cognizable injury. In contrast, in December, in Fraley v. Facebook, the plaintiffs made substantial headway by surviving Facebook's motion to dismiss on Article III, 47 USC 230 and other grounds. [An update on the Fraley case: the court granted Fraley's request to drop out of the case. See 2012 U.S. Dist. LEXIS 34477 (N.D. Cal. March 13, 2012)].

In the EKD/Dawes case, Facebook sought to transfer the venue from S.D. Ill. to N.D. Cal. To do so, it needed the court to uphold the venue selection clause in its user agreement/TOS.

Disaffirmance. The court first addresses whether kids can be bound by Facebook's TOS under any circumstance due to the infancy doctrine, which says contracts with kids are generally voidable by the kids. The court says that kids can't have it both ways--either the contract applies in total or they must disaffirm it in total. Here, the kids haven't disaffirmed it totally because:

Plaintiffs have used and continue to use facebook.com. The Court concludes that Plaintiffs cannot disaffirm the forum-selection clause in Facebook’s TOS, although Plaintiffs were minors when they entered the agreement containing the clause.

This brings to mind the uncited AV v. iParadigms case, the leading kids-and-online-contract case to date. That case involved the plagiarism detection service Turnitin, whose contract with students purportedly let Turnitin retain copies of kids' papers in its database for future precedent checks. The court there said that the kids had received the "benefit" of Turnitin's service (i.e., it had already completed the plagiarism detection on their papers), so there was no way for kids subsequently to unwind the contract completely.

The EKD case differs because the court leaves open the possibility that the kids could void the contract by deleting their Facebook accounts. At the same time, deleting the account wouldn't help these particular plaintiffs because then Facebook would stop showing their names and photos in Sponsored Stories. It remains to be seen if other minor plaintiffs can take advantage of the hole this case doesn't address.

FWIW, kids and online contracts is a hot topic in the academic literature. See, e.g., From the Mouths of Babes: Protecting Child Authors from Themselves by Julie Cromer Young and CyberInfants by Cheryl Preston. I believe Farnaz Alemi has a forthcoming paper on the topic too. The authors of these papers can rest easy about any possible preemption from the opinion; I can't imagine this opinion resolves the issue dispositively.

Binding Nature of the TOS. Having established that the kids are capable of being bound to the Facebook TOS, the court then turns to whether the plaintiffs in fact assented to the TOS. The judge really makes a hash here. The court makes the unqualified statement that "Facebook’s TOS, including the forum-selection clause at issue, are contained in a so-called 'browsewrap agreement.'" This is just an unmitigated misunderstanding of what constitutes a browsewrap, reminding us of the intractable semantic ambiguity of that phrase. See the effectively identical error made in the uncited Fteja v. Facebook ruling from a couple months ago. Indeed, the court proves it knows that Facebook's TOS isn't a browsewrap. Later, the opinion says "persons wishing to join facebook.com must attest that they have read Facebook’s TOS, which are made available through a hyperlink." JUDGES: PLEASE PLEASE PLEASE RETIRE THE PHRASE BROWSEWRAP PERMANENTLY. It's not helping your analysis one bit.

Having made the factual error of calling the TOS a browsewrap, the judge makes a doctrinal error to cover up the factual error by concluding that browsewraps are enforceable. UGH. The court says "the validity of a browsewrap contract hinges on whether the website provided reasonable notice of the terms of the contract," which Facebook did by presenting the TOS as a clickthrough (the language quoted above) and because the TOS is linked in Facebook's footer on every page. Whether or not the users actually read the TOS becomes irrelevant because they had constructive notice.

After it determined the agreement is enforceable, the court says the venue selection clause is reasonable. Get this: the court then chides the plaintiffs for bitching about the venue selection clause's reasonableness because the "time for Plaintiffs to have considered whether the forum-selection clause in Facebook’s TOS would terribly disadvantage them was when they agreed to the TOS."

WHAT? First, the plaintiffs are minors, so by definition they lack legal sophistication to understand and then negotiate a standard form contract with a company that basically never replies to individual emails. Second, the court just said it was a browsewrap, which by definition means that they never "agreed" to it. COME ON.

Don't get me wrong, the judge got to the right policy result. Facebook shouldn't be dragged all over the country by lawsuits from minors. But the judge's doctrinal contortions to reach this result are painful.

Venue Transfer. Having concluded that the venue selection clause is valid and enforceable, the court then effectuates its provisions by transferring the case to Facebook's home court as the clause specifies.

Implications of the Transfer. Hey litigator friends, I could use your help assessing Facebook's move here. (I did ask Facebook for comments, but it declined). Facebook already had an adverse ruling in the highly similar Fraley case. Yet, instead of trying to get a more favorable result in a different circuit with potentially different law, Facebook has transferred this case into the same district where it suffered the interlocutory loss. Is this a good move or a puzzling one? On the one hand, by putting both cases in the same circuit, it increases the likelihood that a win in one will knock out the other (even if that win has to occur on appeal). On the other hand, it took the case out of a venue with uncertain outcome and put it into a venue where it knows it has a fight on its hands. So, litigator friends, does it make sense for Facebook to put all of the eggs in one basket, or should it have diversified its risks? If you email me, let me know if I can quote your email in an update to this post.

A timing note: Facebook filed the venue transfer motion a few weeks before the Fraley decision came out. However, surely it could have withdrawn the motion after that point if it had wanted to, and I doubt EKD would have resisted.

In an email, Venkat responded to my question:

Northern District of California judges see a ton of disputes involving Facebook, and they're probably viewed as somewhat more sophisticated in dealing with Facebook terms and privacy/publicity issues. Also, from an administrative/housekeeping standpoint, Facebook must feel more comfortable there so this may slightly weigh in favor of trying to proceed in California. From a substantive standpoint I can't think of any compelling reason to go there after getting bad precedent in a similar case. (I wonder how the statutes vary as far as the scope of substantive rights they provide. It's surprising this wasn't a bigger issue in the transfer discussion. I realize the classes may be sliced up depending on the type of rights they assert, but CA law provides for more favorable publicity rights in general?).

UPDATE: Rebecca emailed me: "Isn't the incredibly broad scope of Illinois RoP law of importance in the venue, even with a favorable choice of law clause substantively? I'd expect Illinois courts to be more RoP-friendly."

Posted by Eric at 01:38 PM | Licensing/Contracts , Publicity/Privacy Rights | TrackBack

February 28, 2012

Reidentification Theory Doesn't Save Privacy Lawsuit--Steinberg v. CVS Caremark

By Eric Goldman

Steinberg v. CVS Caremark Corp., 2012 WL 507807 (E.D. Pa. Feb. 16, 2012)

CVS Caremark provided consumer data to pharma companies and data brokers. The plaintiffs alleged that the data transfers violated CVS's privacy policies, but CVS apparently disclosed only "de-identified" data as contemplated by HIPAA. Plaintiffs couldn't sue under HIPAA, both because CVS complied with HIPAA and because HIPAA doesn't enable a private cause of action for these violations. Although these facts implicate Sorrell v. IMS, that case didn't come up because the plaintiffs didn't sue under an analogous statute specifically pharmaceutical data transfers.

Instead, the plaintiffs sued under Pennsylvania's consumer protection act, claiming that CVS made material misrepresentations in its privacy policies about its data handling. The court dismisses the suit--with prejudice!--on two principal grounds.

First, it says that CVS told the truth in its privacy policies:

The plaintiffs do not allege that the defendants disclose Protected Health Information to third parties. Rather, they disclose de-identified information, which (a) federal regulations do not prohibit; and (b) is consistent with the defendants' statements that they safeguard information that "may identify" consumers.

To salvage the situation, the plaintiffs' lawyer tried to argue that the de-identified information could be re-identified by recipients, but apparently the plaintiffs' lawyer couldn't make the argument very cogently:

Although they admit that the information the defendants disclose to third parties is de-identified within the meaning of HIPAA, the plaintiffs have argued that it can be "re-identified." There is no such contention in the CAC, and plaintiffs' counsel admitted that the basis for such an argument comes from a single journal article and would take the form of expert testimony that a re-identification risk exists with respect to de-identified information generally, not as to the plaintiffs in this case.

It seems pretty clear that the lawyer didn't fully understand re-identification--at least, not well enough to explain how it might trump CVS's privacy promises. Thus, the court never really gets to the merits of the re-identification theory, but clearly it did not pique the judge's interest. Presumably the "single journal article" referenced is Paul Ohm's Broken Promises of Privacy article. Looks like Paul missed out on a potentially lucrative expert gig.

Second, the court rejects the consumer protection claim on two different standing grounds:

1) the named plaintiff didn't suffer any cognizable loss. The best the plaintiffs' lawyer could do was claim "the loss of the value of his demographic information, or the loss of an opportunity to pay less for his prescriptions with the understanding that the defendants would be profiting from the sale of his information." These types of losses have flopped repeatedly before, and they do so again (citing, among others, LaCourt, JetBlue and Low v. LinkedIn).

2) the named plaintiff didn't allege justifiably reliance on CVS's representations. To get around this specific requirement in Pennsylvania law, Plaintiffs tried to allege that CVS was a fiduciary; that goes nowhere.

The unjust enrichment claim fails because there was no expectation that the information provided to CVS would be compensated. The intrusion into seclusion claim fails because the plaintiffs voluntarily provided their data to CVS.

As we've already seen, privacy plaintiffs' lawyers are avid readers of the privacy scholarly literature, looking for new theories to help them grind their axes. Privacy scholars should be gratified by this practitioner attention. As we know, most law review articles never get read (my mom won't even read mine). As this case illustrates, privacy plaintiffs' lawyers may build their entire cases around the academic literature. Personally, I think this fact means privacy scholars need to ensure that their articles are ready for the rough-and-tumble world of profit-seeking class action litigation. It would be irresponsible for a privacy scholar to toss out a half-baked academic thought about new ways of suing over privacy, knowing that the plaintiffs' bar is looking for fresh meat--anything--to get past 12(b)(6) motions irrespective of the case's true merit. I'm not accusing Paul Ohm's article of being half-baked (far from it, it's one of the most interesting articles I've read in years); but I couldn't be as complimentary towards some of the other privacy scholarship I see, and I hope the thought of being potentially responsible for lots of wasted litigation activity will encourage all privacy scholars to honestly reflect on the social merits of their arguments.

Although the re-identification theory doesn't go anywhere in this case, arguably CVS dodged a bullet. Ever since I read Paul's paper, I have been recommending that companies stop making PII/non-PII distinctions in their privacy policies. It was instantly clear to me from reading Paul's paper that plaintiffs could attack a privacy policy's promise not to disclose "PII" using a reidentification theory because we don't reliably know which bits of data can be used to uniquely identify individuals. Indeed, the language CVS used (it wouldn't disclose information that "may identify" consumers) was especially dangerous, because any bit of information, in combination with the right set of other data, has the theoretical capacity to uniquely identify individuals. The plaintiffs' lawyer in this case was sniffing around the issue but didn't nail it; but other cases--especially after goofy rulings like Pineda treating zip codes as PII--will raise the issue better and pose significant danger to defendants. This case is a warning sign that CVS, and everyone else, should carefully reexamine the PII/non-PII distinctions in their privacy policies.

Posted by Eric at 11:57 AM | Licensing/Contracts , Privacy/Security , Publicity/Privacy Rights | TrackBack

February 14, 2012

Posting Family Photos to Facebook With Snarky Comments Isn't Harassment of Family Member -- Olson v. LaBrie

[Post by Venkat Balasubramani with comments from Eric]

Olson v. LaBrie, 2012 WL 426585 (Minn. App. Ct. Feb. 13, 2012)

This case is what happens when a headline from The Onion comes to life. Aaron Olson sought a harassment restraining order against his uncle Randall LaBrie. Olson argued that Labrie harassed Olson by...get this...posting “innocuous [but surely awkward] family photographs” to Facebook and making mean comments directed toward Olson. The photos included Olson as a child, “posing in front of a Christmas tree.” LaBrie also tagged Olson in the photos. When Olson became aware of the photos, he requested they be removed or “altered to erase” Olson. Labrie demurred, although he untagged Olson. Understandably, LaBrie told Olson that if he did not like the photos, “he should stay off Facebook.”

Olson was not “friends” (in the Facebook sense, or apparently, in any sense) with LaBrie, and accessed the photos via his mother’s Facebook account. The parties had a peripheral argument about how the photos were accessed. LaBrie said that the photos were meant for his inner circle, but Olson said they were accessibble to the general public. At the end of the day, it turns out to not matter. The court says that posting these types of photos to Facebook does not amount to harassment, and the comments offered by Olson as evidence were nothing nore than “mean, disrespectful comments,” which cannot form the basis for liability. The Minnesota anti-harassment statute is directed at:

repeated incidents of unwanted acts, words, or gestures” that have a substantial effect on the “safety, security, or privacy of another."

On appeal, Olson tried to argue that LaBrie conduct had a substantial effect on his privacy, but he did not raise that issue in the trial court and the appeals court says he waived it. Even assuming he had raised it, the court says that Minnesota law recognizes three types of common law privacy violations: intrusion, appropriation, and the publication of private facts. Minnesota law does not recognize “false light publicity.” Olson argued that one of these common law privacy violations could have supported issuance of the anti-harassment order, but the court says that the statute defines harassment, and there’s no need to look to case law for additional definitions.

Olson raised two other issues that are worth noting, and really makes me wonder whether this wasn’t some Onion editor’s attempt to generate a story. First he argued that the trial court erred in not crediting the testimony of his mother, who testified that Labrie’s conduct was offensive. Second, Olson tried to get the record sealed. Hello, Streisand Effect!

The only thing that would have kicked this opinion up a notch would have been a cite to awkwardfamilyphotos.com.

Related posts:

Private Facebook Group's Conversations Aren't Defamatory--Finkel v. Dauber
Revenge Blogger Ordered to Remove Blog--Johnson v. Arlotta (also from Minnesota--is there something in the water there?)
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Eric's Comments

This case demonstrates that the family that Facebooks together doesn't necessarily stay together. I don't understand why Olson was so concerned about the posting of old "innocuous" family photos, although I can understand why Olson might object to "mean, disrespectful comments." At the same time, I also don't understand LaBrie's response that if Olson didn't like it, he should stay off Facebook; nor does it make sense that LaBrie said he didn't intend for Olson to see the photos because they weren't Facebook friends. It seems fair for someone to object to the publication of photos even on a service the person doesn't use or can't see the photos. Obviously there's a backstory to this family squabble that got washed out in the appellate opinion. I guess it goes to show that you can pick your Facebook friends but you can't pick your family. A protip of general applicability: never allow sharp objects at family reunions.

Posted by Venkat at 08:38 PM | Content Regulation , Privacy/Security , Publicity/Privacy Rights

January 31, 2012

Court Denies Kravitz’s Motion to Dismiss PhoneDog’s Amended Claims -- PhoneDog v. Kravitz

[Post by Venkat Balasubramani]

PhoneDog v. Kravitz, 2012 U.S. Dist. LEXIS 10561 (N.D. Cal.; Jan. 30, 2012)

PhoneDog and Kravitz are fighting over ownership of the Twitter account Kravitz used while he was working for PhoneDog. In an earlier order, the court allowed several of PhoneDog’s claims to continue, although it dismissed PhoneDog’s claims for economic interference due to Kravitz’s allegedly improper taking of the Twitter account.

The court's initial order allowed PhoneDog's claims for conversion and misappropriation of trade secrets to proceed, but dismissed PhoneDog's claims for negligent and intentional interference with economic relationships. I thought PhoneDog’s claims were weak at best, and the court could have whittled down the litigation and guided the parties to their ultimate destination—settlement—by culling some of the claims, but no such luck.

With respect to intentional interference with prospective economic advantage, the court accepts PhoneDog’s theory that:

[d]ue to Kravitz’s alleged conduct, there is decreased traffic to [the] website through the [Twitter] Account, which in turn decreases the number of website pageviews and discourage advertisers from paying for ad inventory on PhoneDog’s website.

This looks like a broad theory of economic interference that would sweep up a lot of otherwise innocent conduct, but the court says that at the pleading stage, this is sufficient. The judge’s decision on economic interference seems to view traffic as an asset that can be misappropriated (even if there is no trademark claim, the economic interference claim is like a claim for diversion of traffic). The court also says that PhoneDog’s negligent interference theories also have merit at the pleading stage because “Kravitz owed a duty of care to PhoneDog as an agent of PhoneDog.”

The net result is that all of PhoneDog’s claims move forward, and Kravitz (and PhoneDog) will have to slog through some additional discovery in order to resolve PhoneDog’s claims at the summary judgment stage.

I can't think of any new lessons to draw from this ruling, except that some sympathetic judges will let claims move forward. It would have been cheaper and quicker for everyone involved to have entered into a written agreement addressing the issue, or at least to have addressed this question up front (even if informally).

Previous posts:

An Update on PhoneDog v. Kravitz, the Employee Twitter Account Case
Courts Says Employer's Lawsuit Against Ex-Employee Over Retention and Use of Twitter Account can Proceed

Posted by Venkat at 08:25 AM | Marketing , Publicity/Privacy Rights , Trespass to Chattels

December 19, 2011

Facebook "Sponsored Stories" Publicity Rights Lawsuit Survives Motion to Dismiss--Fraley v. Facebook

By Eric Goldman

Fraley v. Facebook, Inc., 2011 WL 6303898 (N.D. Cal. Dec. 16, 2012)

Because Facebook does so many things that aren't in users' interests, their "Sponsored Stories" program barely registers. Nevertheless, Sponsored Stories demonstrates why many people are burned out on Facebook. Facebook collects user preferences through its semantically ambiguous "like" button and then uses that data to show ads to the users' friends with a seeming endorsement. Using my preferences does little to advance my relationship with my friends, but the implicit endorsement is designed to get my friends to investigate the ads, increasing the advertiser's credibility and Facebook's profits. So Sponsored Stories creates a zero-sum game: I as a user probably don't get any value from the public presentation of my implicit endorsement (if anything, it might hurt my position with my friends), but Facebook and its advertisers benefit from it.

My response to Facebook's rollout of Sponsored Stories was swift and decisive: I don't "like" any businesses on Facebook or do any other activities on Facebook that I believe can trigger a Sponsored Story. (I would also categorically opt-out of being a part of Sponsored Stories if Facebook actually let me decide what I want to share with my friends, but Facebook doesn't). Instead, if I want to make a commercial recommendation to my friends--something I do occasionally--I just share it directly in my status report. That way, I control the message I deliver to my friends, instead of letting Facebook or advertisers control how they communicate my interest to my friends. And the zero-sum nature of Facebook's offering drives a deeper wedge into my relationship with Facebook, making me less willing to use Facebook generally and more receptive to alternatives.

To me, this marketplace response is adequate. To plaintiffs' lawyers, however, Sponsored Stories gives another reason for a litigation fiesta. Remarkably, unlike so many other "privacy" lawsuits against Internet companies, this lawsuit survives the motion to dismiss--dramatically increasing the odds that Facebook will be writing a check for this so-called "feature."

This is a rich and interesting opinion by Judge Koh that has something for everyone to "like" (or dislike). Some of the highlights:

Article III Standing

In a ruling that bucks a mini-trend, Judge Koh upholds the case from an Article III standing challenge. She says that violation of a statutory right (in this case, California's publicity rights statute) automatically satisfies the actual harm requirement of Article III standing. The plaintiffs also satisfied the "particularized" and "concrete" requirements of Article III by explaining how the Sponsored Stories feature used their information.

She explicitly distinguishes numerous defense-side Article III wins (including her own recent iPhone application litigation and Low v. LinkedIn decisions) by noting the particular nature of the plaintiffs' publicity rights claim. In this case, unlike the others, the plaintiffs are claiming that their endorsement had commercial value to help sell goods to others, compared to the situation in the prior cases where the commercial value of a user's data came from theoretically improved marketing to the user him/herself. She says:

Plaintiffs here do not allege that their personal browsing histories have economic value to advertisers wishing to target advertisements at Plaintiffs themselves, nor that their demographic information has economic value for general marketing and analytics purposes. Rather, they allege that their individual, personalized endorsement of products, services, and brands to their friends and acquaintances has concrete, provable value in the economy at large, which can be measured by the additional profit Facebook earns from selling Sponsored Stories compared to its sale of regular advertisements.

She says later:

Plaintiffs assert that they have a tangible property interest in their personal endorsement of Facebook advertisers’ products to their Facebook Friends, and that Facebook has been unlawfully profiting from the nonconsensual exploitation of Plaintiffs’ statutory right of publicity. Thus, in the same way that celebrities suffer economic harm when their likeness is misappropriated for another’s commercial gain without compensation, Plaintiffs allege that they have been injured by Facebook’s failure to compensate them for the use of their personal endorsements because “[i]n essence, Plaintiffs are celebrities—to their friends.”

Clearly, Judge Koh is making a tricky intellectual move, and I bet it's going to make some privacy advocates unhappy. There is unquestionably a street value to data about a person to improve the marketing to that person, just as there is unquestionably commercial value in gaining an endorsement from a consumer. It's awkward to recognize one value and not the other. (Of course, in many of the precedent cases, there was only the possibility of data leakage; there wasn't actually a showing that any marketer had bought the leaked data for commercial reuse).

However, Judge Koh's fancy footwork rips open only a very small hole in the Article III jurisprudence. Her exception only applies where there's a statutory publicity rights claim, and only when the defendant made a commercially-motivated endorsement. I'm sure we'll see plaintiffs advance claims to take advantage of this ruling, but few plaintiffs will be able to style their claims accordingly.

In another tricky intellectual move, Judge Koh distinguishes Cohen v. Facebook, which dismissed a publicity rights claim based on Facebook's "Friend Finder" service, because this case showed a more direct connection between the friend's endorsement and the commercial value derived by Facebook. She also implies the lawyers did a better job here than in Cohen. I didn't fully understand this distinction other than Judge Koh's desire to reach a different result without disturbing the Cohen precedent.

47 USC 230

Facebook's 230 defense is tricky. First, it seeks to invoke the defense against a publicity rights claim, which the 9th Circuit said was possible in Perfect 10 v. ccBill in a controversial statutory reading that has been rejected by every other court outside the Ninth Circuit. Judge Koh doesn't touch that issue.

Second, Facebook seeks 230 protection for the ad copy it created automatically. The ad is based on a user action, the "Like," plus various pieces of user content, but Facebook assembles it all into a package that the user never sees, blesses or necessarily even wants. We've had some other cases upholding 230 when a service provider is so intimately involved with creating the final content, such as the Carafano case, but Facebook is clearly playing at the edge of the statutory immunity.

Judge Koh rules that Facebook is over that line and doesn't get the immunity. Unfortunately, she does so by saying that Facebook is partially the information content provider of the ads in question. She references the dispositive allegations:

Plaintiffs allege that Facebook creates content by deceptively mistranslating members’ actions, such as clicking on a ‘Like’ button on a company’s page, into the words “Plaintiff likes [Brand],” and further combining that text with Plaintiff’s photograph, the company’s logo, and the label “Sponsored Story.” ... Plaintiffs allege that they themselves have no control over whether to post a particular company’s name or logo, and that Facebook maintains sole control over whether to display a Sponsored Story at all.

Personally, I'd be much more sympathetic to Facebook's position if users had the specific ability to "like" a business page without simultaneously authorizing the Sponsored Story. Because Facebook's controls are insufficiently granular, Facebook automatically interprets a "like" as both a statement of user attitudes and as a green light to create the Sponsored Story. In contrast, imagine that when a user "liked" a business page, Facebook prepared the ad copy for the Sponsored Story, presented it to the user, and asked the user if the user wanted to publish the ad copy to his/her friends. At this point, I would feel much more strongly that the ad copy really was the user's words. Naturally, Facebook doesn't give users this level of control over the words being put into their mouths.

On the other hand, consider an alternative example where a website both publishes UGC on its site and then syndicates the content to third party sites. It's my position that the website gets 230 for both acts of publication, even if the user never expressly green-lighted the syndication (so long as the user-to-website license permitted the syndication). See, e.g., Prickett v. infoUSA. Based on Judge Koh's explication, I'm not exactly sure why Facebook crossed the 230 line while some of these other situations probably don't.

Facebook responded that its activities didn't make it a content provider but just represented traditional editorial functions. The court rejects the argument, citing this allegation:

Plaintiffs allege not only that Facebook rearranged text and images provided by members, but moreover that by grouping such content in a particular way with third-party logos, Facebook transformed the character of Plaintiffs’ words, photographs, and actions into a commercial endorsement to which they did not consent.

In the context of this case, I see her point. Sadly, the opinion's wording will give false hope to a slew of plaintiffs who will argue that the website's presentation of third party content constituted some type of unauthorized endorsement. It will take a few cases to burst the plaintiffs' bubbles about a new exception to 230.

The Statutory Publicity Rights Claim (CA Civil Code 3344)

Facebook took a few cracks at the claim, all of which were unsuccessful:

Newsworthiness. The publicity rights statute does not restrict using someone's personality "in connection with any news." This is a backdoor First Amendment defense, as what constitutes news tracks First Amendment jurisprudence on "matters of public interest." This defense seemed like a hail-mary for Facebook--a user "liking" a page is clearly "new" information to the marketplace, but it's not "news" in either the traditional or First Amendment sense. The court seems unimpressed, saying that even if a user "liking" a commercial product is news to that user's social network, using that information commercially drops out of the exception. I wasn't persuaded by the judge's distinction here, but then again Facebook's argument about what constituted "news" was obviously tendentious.

I was a little disappointed that Judge Koh sidestepped some interesting lurking issues about what is "news" in the modern environment, where all of us are publishers to our local communities and we as publishers can have significant clout in a small community. Some academic literature in the 1990s discussed these issues in the Internet context, but it might be worth revisiting as a paper topic. Judge Koh also sidestepped the intellectually interesting issue of whether opinions about marketplace goods are "newsworthy," something that I strongly believe to be the case in the context of anti-SLAPP laws.

Consent. Facebook argued that users consented to Sponsored Stories as part of its terms of use. The plaintiffs retorted that Sponsored Stories didn't exist when they signed up, so they couldn't have consented to it. The court says there's a factual dispute which prevents a motion to dismiss.

Injury. Facebook argued that non-celebrities have to show economic injury as part of their 3344 prima facie case. The court rejects this distinction, saying "[i]n a society dominated by reality television shows, YouTube, Twitter, and online social networking sites, the distinction between a “celebrity” and a “non-celebrity” seems to be an increasingly arbitrary one." Furthermore, the plaintiffs did allege injury by showing that their endorsements were valuable to Facebook, which helps distinguish this case from the Cohen "Friend Finder" precedent. I liked this quote:

While traditionally, advertisers had little incentive to exploit a non-celebrity’s likeness because such endorsement would carry little weight in the economy at large, Plaintiffs’ allegations suggest that advertisers’ ability to conduct targeted marketing has now made friend endorsements “a valuable marketing tool,” just as celebrity endorsements have always been so considered.

For more on this point, see my Online Word of Mouth paper.

Unfair Competition Law (UCL)

Normally, we'd expect the UCL claim to be tossed because the plaintiffs can't make the required showing that they lost "money or property." Numerous Internet privacy cases have reached that conclusion. Judge Koh makes the same intellectual move she did with Article III standing, saying that publicity rights are different than other privacy torts. She says: "[t]o the extent Plaintiffs allege they can prove that their endorsement of commercial products to their Facebook Friends has concrete, quantifiable value for which they are entitled to compensation, the Court finds that Plaintiffs have properly alleged loss of money or property for purposes of establishing standing under the UCL." I wonder if plaintiffs can make that showing because there's no existing market for consumer-to-consumer endorsements, but it's enough to survive the motion to dismiss. In particular, she says California's statutory damages for publicity rights violations aren't enough to demonstrate the value of the endorsements.

Judge Koh also concludes that plaintiffs properly alleged that Facebook's activities were unlawful, unfair and fraudulent (in the latter case, because Facebook allegedly overclaimed users' abilities to opt-out of Sponsored Stories).

Unjust Enrichment

Recent caselaw makes it even clearer that there's no separate cause of action for unjust enrichment; instead, it's just a synonym for restitution. As a result, the court tosses this claim.

Conclusion

This is not a good ruling for Facebook, but I can't really feel too sorry for it. Facebook has been playing fast-and-loose with the law in many different contexts (see, e.g., its FTC bust), and Sponsored Stories is no different. Before rolling it out, Facebook surely knew that the Sponsored Stories offering was on murky legal ground. It can't be surprised that it didn't get an easy dismissal.

Even so, if it gets that far, Facebook may yet win this case. Judge Koh has made it clear that she's a tough customer, but Facebook has plenty of power to its remaining arguments. Nevertheless, I'm reasonably confident it won't get that far. Given the importance of maximizing ad revenues and its desire to clean up legal issues in advance of an IPO, it seems more likely that Facebook will cut a deal with plaintiffs' counsel. I imagine Facebook might try to do a settlement like the Facebook Beacon settlement that results in minimal restrictive covenants, a chunk of money into the lawyers' hands, and a chunk of money that doesn't get into users' hands but instead goes into something like Facebook's privacy foundation.

UPDATE: Facebook is blazing ahead with its Sponsored Stories offering, moving the Sponsored Stories module into the newsfeed instead of on the side. (And with almost-invisible disclosure that it's an ad). Surely this means Facebook plans to win this lawsuit or to settle up. I'm voting the latter.

Posted by Eric at 09:10 AM | Licensing/Contracts , Marketing , Publicity/Privacy Rights | TrackBack

December 08, 2011

Employee's Claims Against Employer for Unauthorized Use of Social Media Accounts Move Forward--Maremont v. SF Design Group

[Post by Venkat Balasubramani]

Maremont v. Susan Fredman Design Group, Ltd., et al., 10 C 7811 (N.D. Ill.; Dec. 7, 2011)

I blogged about a case earlier this year where a plaintiff sued her former employer for improperly accessing the plaintiff's social media accounts. (Here's my earlier post on the case: "Employee's Twitter and Facebook Impersonation Claims Against Employer Move Forward.") I thought the case was dismissed due to plaintiff's inaction, but it looks like the case is still trudging along.

The basic facts: Susan Maremont worked for the Susan Fredman Design Group as the director of marketing. Maremont created a blog and Facebook account for SFGD. She also created Facebook and Twitter accounts that the court says are undisputedly her personal accounts. Maremont suffered an accident. While she was in the hospital, SFDG continued to access and post from Maremont's accounts. (The court is never 100% clear on which of the two Facebook accounts SFDG posted from.) Maremont returned to work briefly on a part-time basis, and during this time she thanked her temporary replacements "for their amazing posts on [the blog] in [her] absence." Subsequently, Maremont apparently changed her mind and sued for alleged misuse of her personal accounts. [The order says that Maremont stored her account access info on the SFDG server, although the folder in which she stored this info was ‘locked’ and she never gave authority to anyone to access it. This was Maremont’s version of the facts. The order does not say exactly how SFDG got access to the passwords (SFDG could have obtained the passwords through accessing the folder on the SFDG server, or it's possible that the computer Maremont used to create the accounts--which were SFDG computers--remembered them).]

SFDG brings a motion for summary judgment, which the court largely punts for lack of evidence on damages.

Lanham Act claim: Maremont's Lanham Act claim requires her to show that she had an intent to commercialize her identity. The court says that she satisfies this requirement, noting that "it is undisputed that Maremont created a personal following on Twitter and Facebook for her own economic benefit . . . " However, Maremont also must show that she was somehow damaged by her unauthorized affiliation with SFDG. The court gives Maremont additional time to marshal evidence as to how she was damaged. Maremont tells the court that she will bring an expert to testify as to the damages issue.

Stored Communications Act claim: As to the Stored Communications Act claim (which Maremont added later on in the lawsuit) there is no dispute that SFDG accessed Maremont's accounts:

there is undisputed evidence in the record that Defendants accessed Maremont's personal Facebook account and accepted friend requests at least five times from September 23, 2009 through November 24, 2009. Moreover, evidence in the record reveals that Defendants posted seventeen Tweets to Maremont's personal Twitter account during the relevant time period.

This probably amounts to unauthorized access of "a facility through which an electronic communication service is provided." However, the court says that in order to be entitled to statutory damages under the SCA, Maremont has to show that she suffered some "actual damages." (See Van Alstyne v. Electronic Scriptorium.) Because of the dearth of evidence on the damages issue, the court declines to grant summary judgment at this juncture. (Although the court's discussion of whether the SCA requires actual damages as a prerequisite to relief is not extensive--and as Van Alstyne acknowledges, there is mixed authority on the issue--the ruling is significant in this regard.)

Right of Publicity claim: The right of publicity claim fails because SFDG did not pass itself off as Maremont, even though it posted tweets through Maremont's Twitter account. The first of the objectionable tweets explained Maremont's absence and linked to a blog post by Susan Fredman. Additionally, upon returning to work on a part-time basis, Maremont "thanked" SFDG's guest editors for their efforts. Thus, the court concludes that SFDG did not misappropriate Maremont's likeness.

Common Law Privacy claim: Maremont also brought a common law privacy claim, which appeared to be based on the "intrusion of seclusion" tort. The court says that she has to show that defendants intruded into a matter that was private and which the plaintiff attempted to keep private. The court says that Maremont cannot satisfy these elements:

there is no dispute [that] . . . the matters discussed in Maremont's Facebook and Twitter posts were not private and that Maremont did not try to keep any such facts private. In short, Maremont fails to point to any private information upon which Defendants intruded.

Cf. Moreno v. Hanford Sentinel.
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This is a messy dispute, and some of the facts don't seem clearly developed by either the court or the parties. For example, there were two Facebook accounts involved (one for SFDG and one which Maremont uses personally), but later in the discussion, the court doesn't specify which Facebook account it is talking about. Second, the court notes that "there is no evidence in the record concerning the actual Facebook postings and their content." This is a strange evidentiary omission by the plaintiff.

Then there's the issue of actual damages. Maremont has a Herculean task in proving that her affiliation with SFDG as a result of a smattering of social media posts somehow had a negative financial effect on her. How exactly was she damaged by this association? It's not as if SFDG said anything negative about her. Maremont's claim is that while she was in the hospital, SFDG continued to post and make it look (to the untrained eye) that Maremont continued to handle SFDG's social media efforts. Would a prospective client really refuse to hire Maremont because of these posts? Did this somehow diminish Maremont's earning capacity? I'm not sure what Maremont's expert is going to say, but he or she better come up with something good.

The court's analysis of the invasion of privacy issue also threw me for a loop. The court concludes that the information contained in the posts were public, so there's no violation by SFDG when it posted to Maremont's accounts, but this didn't seem to be the crux of Maremont's invasion of privacy claims. Maremont should be arguing that when SFDG accessed Maremont's accounts, SFDG could also have accessed private facts stored in the account, such as private messages, DMs, photos, and other information in the Twitter/Facebook accounts that were not public. The court's analysis makes me think that the court didn't understand that Twitter or Facebook accounts can contain other information than what's actually publicly "posted" through the account. (Of course, Maremont would have faced a challenge when it comes to damages. She may not have had a standing problem, but she would have to show that she suffered damage as a result of the intrusion, and it's fair to presume from the court's dismissal of her claim that she failed to put forth adequate evidence on this issue.)

This case, along with the PhoneDog case (and Ardis Health) highlight the inherent ambiguity in ownership over social media accounts. Property-wise, it's tough to slot the accounts in a particular box. There also seems to be differing expectations on the part of the employer and employee. The employee obviously wants to take the account with her when she leaves, but the employer would like to continue to take advantage of the goodwill built by the account. There is a solution, and that's to have a written policy in place! A policy is not a cure-all, and I think it's equally important to have a discussion up front about whose account this is and what happens when the relationship terminates. (This is a mini-version of the "blog ownership question" that Eric has harped on.)

As with the PhoneDog case, this is another dispute where the attorney's fees expended could eclipse the value of the case. If the facts as alleged are true, SFDG stepped way over the line in accessing Maremont's accounts, but Maremont's damages are probably minimal. (Ironically, I would think the invasion of privacy claim would be one of the strongest, but the court kicks this claim.)

As a final note, it's worth comparing the result in this case to In re Rolando S., the case where a California appeals court found that a juvenile violated California's identity theft statute when he took someone's Facebook account for a joyride. Here, SFDG gets dangerously close to this line, although it was not clear that the posts in question purported to be from Maremont. As I mentioned in my initial post on the case, depending on what jurisdiction you are in, meddling with someone's social media account in this context could result in e-personation liability.

Posted by Venkat at 03:45 PM | Privacy/Security , Publicity/Privacy Rights , Trademark

November 22, 2011

Court Awards Damages for Wrongful Disruption of Web Presence -- Ordonez v. Icon Sky Holdings

[Post by Venkat Balasubramani]

Ordonez v. Icon Sky Holdings LLC, 10-cv-60156-PAS (S.D. Fla. Aug. 30, 2011)

This was another dispute involving two parties who jockeyed for control of an online presence. I guess you could say that one “jacked” the other’s presence.

Elizabeth Ordonez is a dancer, model, actress, choreographer (etc.) and is known by her fans as “Elizabeth Sky.” She sued Nisha Elizabeth George and her entity Icon Sky Holdings alleging that Icon Sky wrongly obtained a trademark registration for “ELIZABETH SKY” and went on a campaign to disrupt Ordonez’s web presence. George allegedly sent letters to ModelMayhem, Twitter, MySpace, and Facebook, all of whom took down Ordonez’s content, account, or forced Ordonez to change her name.

Ownership of the mark: As far as which of the two parties should be entitled to use the ELIZABETH SKY mark, the facts were pretty unfavorable to George and Icon Sky. Ordonez had been using Elizabeth Sky as a stage name for many years, and the court described some pretty serious irregularities in George’s procurement of the trademark. George was aware of that Ordonez was the senior user, and submitted a specimen that wasn’t really a specimen (it was the exact same specimen which George submitted for another trademark application, but appeard to have been “graphically edited”).

Athough it was a default case, the court easily disposes of the trademark issue. The court finds that George was the junior user and used the ELIZABETH SKY mark in connection wich similar goods and services. This is sufficient for the court to find for plaintiff on her Lanham Act and state law unfair competition claims and this entitles Ordonez to injunctive relief as to George’s use of the ELIZABETH SKY mark.

Tortious interference: Plaintiff also prevailed on her tortious interference claims, which were premised on George’s interference with the contractual relationships between plaintiff and various social networks. The court found that (1) there was a contractual relationship, (2) George knew about this relationship (since she signed up for the services, she was aware of the applicable terms of use), (3) an intentional and unjustified interference, (4) which caused damage. In addition to the social networks, George also demanded that other website take down content which plaintiff had put up. The court found that Ordonez was damaged because her business contacts “discontinued showcasing plaintiff on their websites for fear of being sued,” and many entertainment industry professionals “stopped requesting plaintiff for jobs.”

Libel per se: Finally, plaintiff made out a claim for libel because George falsely accused plaintiff of identity theft. Since identify theft is an “infamous crime,” the court says that plaintiff satisfied the elements of libel per se and did not need to prove damages from George’s statements.

Relief: The court grants plaintiff injunctive relief with respect to the trademark issue and enjoins defendants from continuing to use the mark. Plaintiff also asked to freeze certain of George’s domain names but the court denies this relief since the complaint did not specifically allege a cause of action under the ACPA. Finally, the court awards $81,000 in damages. The bulk of the damages were for plaintiff’s tortious interference claim, and plaintiff put forth evidence that it cost her $78,000 to build her “online presence” – ten hours per week at $50 per hour (over a period of three years). She sought $243,000 in damages for performances that plaintiff’s booking company refused to book because of George’s actions, but the court found the evidence flimsy on this point (and duplicative of the $78,000 in damages it already awarded). The court awards $3000 for lost booking.
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Eric has blogged a bunch about brands dueling on social networks via takedowns. The Complexions spa case: “Business Sues Facebook to Restore Its Fan Page” and the Ozimals case “Second Life Ordered to Stop Honoring a Copyright Owner's Takedown Notices” are two recent examples. In both of those cases, the networks ended up embroiled in the dispute whereas here Ordonez went after the alleged wrongdoer directly. A user can be enjoined from sending improper takedown notices, but it’s legally questionable as to whether a court can force a network to put someone’s webpage back online (both from a First Amendment and section 230 filtering standpoint, the network should be able to keep content off-line). This particular case is a trademark case, but in the copyright context, section 512 provides some applicable rules: Wrongful takedowns can result in money damages (Lenz), Someone can be enjoined from sending bogus takedown notices (Design Furnishings v. Zen Path), and an intermediary can be enjoined from providing access to a piece of content (section 512(j)).

The interesting thing about this dispute is how the networks in question readily took down plaintiff’s webpages and content. It’s unclear as to whether George went to Facebook, Twitter, and YouTube and waved around the trademark registration—from the court’s recitation of the facts, it did not seem like George was armed with a registration when she complained to the various networks. It’s tough to draw any conclusions from this case, but my instinct is that networks are more than willing to honor takedown notices without closely scrutinizing them, although at times it seems like networks have their own (sometimes maddening) administrative mazes in place.

This is a rare ruling awarding damages to a plaintiff who is claiming tortious interference based on a wrongful takedown. Where the takedown is based on copyright ownership, there may be a preemption issue, so it’s not easy to assert a tortious interference claim based on a copyright takedown notice. (See the Ozimals ruling, “17 USC 512(f) Preempts State Law Claims Over Bogus Copyright Takedown Notices” but see the Smith v. Summit Entertainment case: “17 USC 512(f) Claim Against 'Twilight' Studio Survives Motion to Dismiss” and Rossi v. MPAA. Where a copyright takedown is involved, a plaintiff is better off proceeding under section 512(f).)

Since this case was resolved on a default motion, it’s unclear as to whether in a contested case damages are viable. At any rate, this is one additional datapoint that people who submit takedowns want to keep mind. You can be liable under section 512 if you send a wrongful DMCA takedown, but you may also face liability for tortious interference for causing a network to take someone’s web presence off-line.

Posted by Venkat at 09:39 AM | Publicity/Privacy Rights , Trademark

October 29, 2011

Publicity Rights Class Action Against Facebook Over Promotion of 'Friend Finder' Service Dismissed -- Cohen v. Facebook

[Post by Venkat Balasubramani]

Cohen v. Facebook, Inc., C10-5282, 2011 U.S. Dist. LEXIS 124506 (N.D. Cal. Oct. 27, 2011)

This is a putative class action against Facebook for "promoting its 'friend finder' feature by disclosing to users that their Facebook 'friends' have used that function." The first time around, the court dismissed the claims, but granted leave to amend. ("Court Dismisses Misappropriation Claims Against Facebook Over Its Friend Finder Service.")

This time around, the court's order focused on the issue of whether plaintiffs adequately alleged injury. Facebook argued in its earlier motion that the claims were undermined by Facebook's terms of service, but the court says this issue is not amenable to resolution at the motion to dismiss stage, and Facebook does not bring this argument up again. The court previously ruled that plaintiffs are not automatically entitled to relief under California's publicity rights statute and that plaintiffs can recover non-economic damages if they suffer emotional harm.

In the amended complaint, plaintiffs did not take the route of claiming emotional distress damages. They alleged instead that their names and likeness had economic value to Facebook. The court says that the allegations are insufficient, noting that plaintiffs did not allege that they were entertainers or models, or some other category of individuals who had "an obvious economic interest in [their] likenesses." The court also says that Facebook is using the likeness in a context where it already appeared:

the names and likenesses were merely displayed on the pages of other users who were already plaintiffs' Facebook "friends" and who would regularly see, or at least have access to, those names and likeness in the ordinary course of using their Facebook accounts.

The court says anyone who alleges some cognizable injury under the publicity rights statute can recover statutory damages, but plaintiffs failed to allege the minimum necessary. The court dismisses the case with prejudice.
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It's possible that judges in the Northern District of California are getting sick of privacy class actions, because lately they have been pretty harsh on them. I don't think it's necessarily a bad thing, but it seems like courts are scrutinizing these complaints very closely. The iPhone class action, where the court shreds the complaint, was the most recent example before this one: "iPhone Privacy Class Action Dismissed for Lack of Standing."

Plaintiffs face the challenge that they have to tailor their complaints to suit a class, but they do not do a good job of coming out and arguing what exactly the harm is or where exactly the misappropriation occurred. Was this simply a case of Facebook disclosing to your friends that you had used the 'friend finder' service and showing your profile picture when they did this? Or was there something more? (This is a publicity rights and not a privacy lawsuit, but am I missing something, and is Facebook's 'friend finder' some sort of super secret risque alternative dating service?) If there was more to this, it did not come through in the court's order, and maybe plaintiffs just didn't do a great job of making sufficient allegations of nefarious conduct on the part of Facebook.

Plaintiffs tend to rely on this argument that the information or likeness has value, because it has value to Facebook (it must have value, because Facebook is exploiting it). But courts are not buying this argument. Facebook may or may not be exploiting your personal information or likeness, but you have to be able to articulate some value to it independent of the fact that Facebook is exploiting it. As we've seen in several cases, this is often a challenge.

The court dismisses on the basis that plaintiffs have not suffered cognizable injury under the statute, but in a footnote alludes that Article III standing would be a problem anyway. It's not clear as to whether alleging a statutory violation is sufficient to confer standing, or whether plaintiffs have to independently satisfy Article III standing requirements. A case pending before the United States Supreme Court raises this issue with respect to a federal statute; Facebook, Yahoo! and others have weighed in with a friend of the court brief. (See "'Sleeper' Case Asks Whether Plaintiffs Can Sue Without An Injury.") If there's an independent Article III standing requirement, can plaintiffs proceed in state court?

These lawsuits don't leave us with much clarity. Is Facebook engaging in some edgy practices to exploit users' likenesses and information? It's possible, but the best you can say after this case is that plaintiffs' allegations were muddled and the judge threw them out.

Previous post:

"Court Dismisses Misappropriation Claims Against Facebook Over Its Friend Finder Service -- Cohen v. Facebook"

Posted by Venkat at 07:50 AM | Publicity/Privacy Rights

September 24, 2011

Gilbert Arenas' Tweets Sinks His Motion to Enjoin "The Basketball Wives" -- Arenas v. Shed Media

[Post by Venkat Balasubramani]

Arenas v. Shed Media, CV 11-05279 (C.D. Cal.; Aug 22, 2011)

Arenas is a basketball player for the Orlando Magic. He goes by various nicknames, including "Agent Zero, Agent Arenas, and Hibachi." Arenas and Laura Govan were once in a relationship and have four children together. Shed Media produces the "Basketball Wives" television series, which centers around a cast of women, "most of whom have or have had a romantic relationship with a professional basketball player." Govan was set to appear in "Basketball Wives: Los Angeles," a spinoff of "Basketball Wives." Arenas moved to enjoin the broadcast and publicity around Basketball Wives: Los Angeles. He principally brought claims under the Lanham Act and under California's publicity statute.

Publicity Rights

The court notes that it's unclear as to whether the show will use and appropriate Arenas' identity. Arenas conceded that Shed Media "[took] care to avoid explicit reference to [Arenas'] name in the advertisements." Shed Media tried to argue that there's no publicity rights issue because the show would not discuss Arenas by name and any reference would be in reference to Govan's relationship with a certain unnamed basketball player. The court rejects Shed Media's argument, finding that it's inevitable that Arenas would come up in the show, either by name or by implication. The court then moves on to the two available affirmative defenses: (1) transformative use and (2) the "public interest" defense.

The court finds that Shed Media is likely to succeed on its transformative use defense. According to the court, the focus of the show is on "women who have or have had relationships with basketball players" rather than "the players themselves." The show is not using Arena's likeness to sell or endorse unrelated products or services.

The court also found that Shed Media would be likely to prevail on the "public interest" defense. This turned on whether Arenas' life is a matter of "public concern," and Arenas argued that his personal life and relationships were not a matter of public concern. The court disagrees, pointing to Arenas' Twitter feed for the proposition that Arenas has himself publicized many mundane details about his life (e.g., "dont u hate waking up doing the same thing..wash face..brush teeth..pee..take shower (well sum of us)...put on clothes...eat...etc.").

Trademark claim

The court characterizes Arenas' trademark claim as "muddled." (The court doesn't discuss the issue of whether Arenas' name, as a personal name, is entitled to trademark protection at all.) There's no possible confusion between the title of the show and any of Arenas' marks. Arenas also argued that Shed Media's use of his name in the show itself constitutes infringement. The court disagrees, saying that Shed Media would readily have a "nominative fair use" defense available (citing to Toyota Motor Sales v. Tabari). It would be virtually impossible for the show to refer to Arenas without actually mentioning his name. Additionally, any discussions Arenas' ex would have in the press would not necessarily suggest endorsement: "common sense suggests that a celebrity may not agree with his ex-girlfriend's opinion of him."

Irreparable harm

Having found that Arenas is unlikely to prevail on his claims, the court does not need to address the issue of whether he will be irreparable harm, but it touches on this issue anyway. Arenas argued that the show is one that "prides itself on its coarse brand of drama" featuring "cat fights" and "infidelity issues," and the association between the show and Arenas' brand would lessen his reputation. The court disagrees, again turning to Arenas' Twitter feed and his own statements:

Shed Media provides a treasure trove of newspaper articles about and tweets by Arenas that, taken as a whole, convince the Court that Plaintiff's reputation will suffer no serious blow if BWLA airs as scheduled. For example, to paraphrase Shed Media, it is difficult to see how an association with 'cat fights' will tarnish Arenas' reputation when he has been publicly associated with potential gunfights. [Ouch!] Arenas made national headlines at the beginning of 2010 over an incident in the Washington Wizards locker room in which he drew a gun on a teammate during a dispute over a gambling debt, and ultimately pled guilty to carrying a pistol without a license. Arenas has publicized on Twitter his views of women and other groups--opinions that would be characterized by many, if not most, people as crude and offensive.

Moreover, Arenas has already associated himself with the show by tweeting directly or indirectly about Govan's appearance on it. In these tweets, Arenas expresses his opinion that he "doesn't care what Govan does" because "if she gets a job he pays less money to her." According to Arenas, most basketball players do not know that (1) "they" (presumably ex-wives and ex-girlfriends) cannot lie about basketball players on television because the players can sue the show; and (2) the basketball players pay less money if "they" have a job.

Then there's my personal favorite of Arenas' comments:

Arenas opines that he 'care[s] more about [watching people] plank [i.e., lie prone] th[a]n my ex on tv.'

Ultimately, the court blocks Arenas' attempts to shut down the show. To add insult to injury, the court grants Shed Media's anti-SLAPP motion.

The court's ruling paves the way for the show to discuss aspects of Arenas' life as they relate to Govan. The tenor of the ruling is that, in this day and age of hyper-focused attention on the lives of celebrities, some discussion of this nature has to be tolerated and the fact that a reality show may seize on this is not something a celebrity can prevent by asserting his or her personality rights. Arenas' trademark claims seemed fairly weak, and while it's not quite on par with the 1-800 GET THIN v. Hiltzik case which Eric blogged about last month, the court makes clear that the show has some breathing room to refer to Arenas without running the risk of consumer confusion. Finally, we're left with the classic situation of a modern litigant making an argument that's inconsistent with statements he or she said online.

NB: this isn't the only dispute around Basketball Wives, Los Angeles. Chris Bosh sued Allison Mathis, his former paramour and the mother of his children to block her appearance on the same show. The court (same judge) granted Mathis' motion to dismiss for lack of personal jurisdiction. You can access that order here.

Additional coverage:
THR (Eriq Gardner): Judge Rejects Gilbert Arenas' Attempts to Block VH1's 'Basketball Wives' (Exclusive)

Posted by Venkat at 10:12 AM | Publicity/Privacy Rights

September 06, 2011

Marijuana Activist Can't Change His Name to "NJWeedman.com" -- In re Forchion

[Post by Venkat Balasubramani with additional comments by guest blogger Laura Heymann and Eric]

[Eric's note: this may be our first post with *three* different bloggers covering the same case! Venkat starts us off:]

In re Robert Edward Forchion, Jr., 2011 WL 3834929 (Ca. Ct. App. Aug 31, 2011)

Robert Edward Forchion, Jr. filed a petition to have his name changed legally to "NJWeedman.com." The trial court denied the request, and the appeals court affirms.

Background: As the court describes him, Forchion:

is a resident of New Jersey. Since 2009, he has managed a Rastafarian temple in Los Angeles and has operated a medical marijuana dispensary that he claims is lawful under the Compassion Use Act of 1996. . . . He has devoted his adult life to promoting the legalization of marijuana and, in 2000, was convicted in New Jersey of marijuana offenses. Forchion is currently facing trial in New Jersey on marijuana charges arising out of an arrest on April 1, 2010. He is free on bail.

Forchion has a national reputation as a marijuana advocate and is popularly known as NJweedman. He operates a Web site, "NJweedman.com," which discusses his efforts to legalize the drug. In 2001, Forchion unsuccesfully petitioned the New Jersey state courts to change his name to "NJWeedman.com."

Discussion:

Forchion's life: The court spends approximately 20 pages recounting the details of Forchion's life, including his protests, and brushes with the law. (These facts were apparently taken from Forchion's website.) For example, the court notes that he "smoked his first marijuana cigarette and 'was immediately impressed by its medical healing powers, in regard to his asthma' . . . . [b]y age 18 he was a regular user . . . and dismissed the Surgeon General's claims of its harms as 'propaganda and Christian superstitions.'" He enlisted in the United States Marine Corps where he continued to use marijuana, despite the government's prohibition. He became a coast-to-coast trucker in 1994. In 1995 he "became a practicing Rastafarian."

In 2008, he apparently fled to California, "seeking asylum, leaving the garden state for the pot friendly environs of Los Angeles." In 2009 he opened a "Rastafarian Temple" on Hollywood Boulevard. The temple was named "Liberty Temple II, after a series of protests he held at the Liberty Bell in Philadelphia." He then became a "Hollywood persona," and opened a "party promotions company called "NJweedmanPromotions." In 2010, he penned his biography, which was titled "Public Enemy #420." None of this is particularly relevant to Forchion's name change petition, but the court walks through the facts in some detail and they were strangely interesting. (All of this just gets to page 6 of the court's recitation of facts.)

Name changes generally: The court notes that people who wish to change their names have two different options. They can take the route of a "common law change of name," and simply start referring to themselves as something else (as long as their purpose is not to "defraud or intentionally confuse"). They can also formally change their names pursuant to statute. The statutory route offers certain advantages, namely the change of name is "definitely and specifically established and easily proved." In contrast:

[a] common law name change . . . carries with it no mandate to those with whom one comes in contact to accept at face value the nexus between the new name and the individual who assumes it.

In any event, the court concludes that while there must be a "substantial" reason for denial of a request to change one's name, the trial court is vested with discretion in ruling on a name change petition and the reasons offered in case law for refusing a name change request are not exhaustive.

Can Forchion change his name to a domain name?: The court turns to the key issue of whether Forchion can change his name to a domain name. This turns on whether Forchion is guaranteed to be able to use the NJWeedman.com domain name indefinitely. The court notes that although domain name registrants "appear to possess all [of] the component rights" of property owners, on closer examination, "it becomes apparent that a domain name is not property." The court concludes that a domain name is merely the product of an agreement for services between the registrant and the registrar. The agreement--pursuant to which a registrant secures a domain name--is not guaranteed to continue indefinitely. The registrar places numerous limitations on the registrant's use of a domain name and if the registrant breaches the domain name registration agreement in any number of ways (e.g., fails to pay fees, allows the domain name registration to lapse, uses the domain name in violation of the law), the registrar can cease providing the registration services. The court sees this as problematic because if Forchion's name change is approved, his name would "permanently" become "NJWeedman.com," but if he loses the domain name a subsequent user could end up with the rights to NJWeedman.com. In the court's eyes, the "dual use might create confusion, depending in part on what the new registrant did with NJweedman.com."

The court also notes that even if Forchion continued to pay the registration fees in perpetuity, his use of the domain name may run into problems due to a conflict with third party trademark rights. If a third party is able to assert trademark rights and successfully force Forchion to change his website or discontinue his use of the NJweedman domain name, the court says that his continued use of NJweedman.com as a personal name would be problematic. The court says it's not aware of any procedure pursuant to which a third party could force NJweedman.com (f/k/a Forchion) to change his personal name. The court says that these types of trademark considerations are not ones that the trial court should be forced to consider, when ruling on a name change. [Strangely enough, the court relies on those considerations in making its decision.] At the end of the day, the court says that domain names and personal names should remain in separate realms and the streams should not be crossed:

In sum, personal names and domain names should not overlap; they belong in distinct realms. Domain names were created for use on the Internet and should be limited to assisting a user in finding a desired Web site. By the same token, we should not treat a person as part of a domain.

As an added bonus, the court also points out that Forchion's website encourages others to break the law and is on thin legal ice. The website provides instructions on how to grow marijuana. It urges individuals to call New Jersey law enforcement and "provide false reports about the use of marijuana, hoping to send the police on wild goose chases and squander valuable resources." The court also closes the 37 page (!) order with a nod to comity principles. The court notes that while courts are "divided over res judicata applies to name changes . . . the principles that underlie the application of that doctrine are present here."

The court's opinion borders on entertaining and covers a lot of different ground. In particular, the discussion of the two types of name changes was interesting. At 37 pages, it felt a bit excessive, but I can't say I was disappointed after reading it.

I was surprised to see the court treat the domain name registration rights as a contract right, rather than a property right, given that numerous cases have discussed the issue since Kremen v. Cohen and have concluded that (at least for conversion and creditor remedies purposes) domain names are considered property and not a contract right. (See, for example: Eysoldt v. ProScan and CRS Recovery, Inc. v. Laxton.) As Eric points out, the fact that the domain name registration agreement could lapse or be terminated wasn’t a particularly persuasive basis to deny Forchion’s name change request.

I hadn't given any thought to the interplay between trademarks and personal name changes, but a quick Google search led me to a Yahoo! answers question titled "Can i legally change my name to Krispy Kreme," which in turn led to a New York Times article about a 1995 lawsuit between Coca Cola and Fredrick Koch, who wanted to change his name to "Coke-is-It." (See "Coke Settles With 'Coke-is-it.'") It looks like Coca Cola settled with Mr. Coke-is-it based in part on his agreement to not use his name commercially. To the extent the court should have even raised the issue on its own, the trademark versus personal name conflict was unrealistic in this case, given the name chosen by Forchion. I guess a lawn maintenance company in New Jersey could have a similar name and grumble, but really?

I wasn't particularly persuaded by the court's reasoning that a person should not share a personal name with a website because of the possibility of confusion between the two. Is there a realistic possibility that someone would look at Forchion post-name change and equate him with a website found on the internet? Even to the extent there is confusion, would this really result from the addition of .com to NJweedman? Courts and the PTO have long recognized the lack of trademark significance of a .com, and the court's conclusion seems to presume that Forchion's use of a dot com for his personal name would somehow be the basis for confusion.

I didn't have any immediate plans to change my name to balasubramani.com, but at least in California it looks like this wouldn't fly.

Other coverage:

"Court won’t let marijuana activist change his legal name to njweedman.com" (Evan Brown)

______________

Laura Heymann's Comments

[Eric's introduction: I'm pleased to include the following thoughts from Laura Heymann, the Class of 2014 Professor of Law at William & Mary Law School. Laura has been doing some excellent and thought-provoking work on the regulation of naming, and this case squarely implicates the issues she has been thinking about deeply.]

In In re Robert Edward Forchion, the California Court of Appeal affirmed a lower court decision denying Forchion the right to change his name to NJweedman.com, which also happens to be the URL for his website. Forchion is not the first individual to attempt to change his name to a URL. In 2003, animal rights activist Karin Robertson legally changed her name to GoVeg.com, the website of her employer, the People for the Ethical Treatment of Animals, in order to spark discussions about vegetarianism and animal rights; she reverted to her birth name three years later.

Forchion has apparently long advocated in favor of the legalization of marijuana, and both his advocacy and his personal experience with the drug have been the cause of a number of run-ins with the law, all of which is detailed at his website. (As Venkat notes, the California appellate court, taking “judicial notice of the content of [Forchion’s] Web site and any other Web site to which it provides a link,” quoted extensively from the website in rendering its decision.) While he was incarcerated in New Jersey, his home state, Forchion unsuccessfully petitioned the New Jersey state courts to change his name to NJWeedman.com. Forchion subsequently moved to California, where he continued his advocacy (and also operated an allegedly lawful medical marijuana dispensary). In California, Forchion tried again, petitioning a lower court to change his name to NJweedman.com, and was similarly rebuffed both there and on appeal.

As Forchion’s choice of moniker demonstrates, and as I have discussed in a recent article (Naming, Identity, and Trademark Law), personal names have at least three functions. A name is denotative, in that it refers to or identifies a person, allowing us to talk about an individual when he or she isn’t present. A name is also connotative, in that it often suggests or brings to mind a set of characteristics or attributes relating to the person to whom the name is connected. Parents typically have connotation in mind when they decide what to name their children, particularly when choosing a name that signifies a connection to a religious or ethnic heritage. And a name also has an associative function in that it signals a connection to a group or family. Indeed, the decision of Eric and his wife, Lisa, to take on a new shared surname upon their marriage is an example of, as he once wrote, establishing a “new common identity which is uniquely [theirs] as a couple.”

Our personal names also function, in a sense, like trademarks. When we write or speak or otherwise share our creativity with the world, our name is what tells people who is responsible for those thoughts and what allows us to build our reputations. And, like trademarks, we may well want to choose a name for our efforts that is itself creative – that expresses something about ourselves that our given names do not. Indeed, each time we participate in an online environment – a social network, a virtual world, a blog, or even sending e-mail – we choose a name through which we will present ourselves to the world.

Many naming choices are made informally – we ask friends and relatives to call us by a nickname or choose a pseudonym when we decide to comment on a blog post. But in an increasingly administrative world, some choose to make names “official” by petitioning the courts for a change in name. Despite the claim by many jurisdictions that this process is ministerial – simply to create an official record of the exercise of the right we have under the common law to change our name – courts will, from time to time, deny such requests on the grounds that the requested name was chosen for fraudulent or deceptive reasons, is offensive or obscene, or is otherwise objectionable. California’s name change statute has been interpreted as granting the courts discretion in deciding whether to grant a name change petition but also as providing that petitions should not be denied without some “substantial reason.” Indeed, the California courts’ own website suggests that the “main reasons” for denying a name change petition in the state are a finding that the petitioner is changing his name to commit fraud, hide from authorities, or for some other illegal reason.

So why was Forchion’s petition to change his name to NJweedman.com denied? The California appellate court offered four reasons, all of which seem somewhat curious. First, the court held that allowing Forchion to change his name to NJweedman.com ran the risk of confusing others. For example, the court noted, if Forchion ever lost the domain name for his website and someone else were to pick it up, there would now be two entities out there sharing the name NJweedman.com: Forchion and the now unrelated website. This, the court held, was untenable because “if both parties used that name to conduct business, confusion might result.” Second, even if Forchion did maintain the website, the court held, “the name might be so similar to another Web site name or trademark that the multiple usage would create confusion.” Third, the court held that the name change would encourage those who encountered Forchion to view his website, which, the court concluded, encouraged illegal activity. And, finally, the court held that given Forchion’s failed attempt to request a similar name change in New Jersey, his home state, principles of comity militated in favor of denying relief in California.

The idea that changing one’s name to that of an existing URL would create a level of confusion warranting the denial of the name change – either as between that URL or another URL or trademark – seems implausible. Naming is always contextual, and it is the rare name that isn’t also being used by someone else. We all like to think of our names as unique, but a quick Google search will often reveal at least one other person who shares our first name/last name combination. [Eric's note: recall our mockery of Bev Stayart on this point]. It’s also not uncommon for a personal name to be identical to a common word in the English (or another) language, such as the first names Hope, Faith, Hunter, and Clay. None of this presents a considerable difficulty either for the named or for those who refer to them; context will typically tell us whether the sentence “Faith is important to me” is being uttered by a congregant or by Faith’s partner. Although it has communicative components to it, a URL is ultimately an address. “Montana,” for example, has ranked among the top 1,000 girls’ names in the United States in recent years [you can do a search for Montana in NameVoyager], but no one would suggest that the existence of hundreds of little Montanas running around is going to cause travelers to have problems finding the state on a map. Nor is the potential similarity to an existing trademark problematic. A quick Internet search reveals more than fifty individuals with the given name John Deere, but it is unlikely that anyone negotiating with any of these men has been confused into thinking that they are dealing with the farm equipment manufacturer.

Comity also seems to be a curious basis for denying a name change petition. Given the mobility of individuals today and evolving family situations, it’s possible that an individual might change one’s surname upon marriage, change it back to one’s birth name upon divorce, change it again upon remarriage, and change it again for professional reasons. It would be odd to suggest that the ruling of any one state on one of these petitions would affect in any way the ability of another state to make a subsequent ruling. There may be statutory limitations on a court’s ability to render such a judgment, in that a particular state statute might require that the petitioner be a resident of the state in order to file a petition (as the appellate court suggested here). But comity doesn’t seem to be the reason to bar such requests, particularly if part of the basis for deferring to a sister state is, as the court stated here, that “the first two letters of the requested name — NJ — are not only the home state’s abbreviation but are intended to refer to that state.”

And so we come to what seems to be the primary motivation for the denial: the content of Forchion’s website. The court did not conclude that the name “NJweedman.com” was itself offensive; indeed, it noted that several New Jersey residents bear the surname Weedman. And while courts have rejected petitions to change one’s name to words that are, on their face, offensive or obscene, on the ground that the court should not be seen as stamping its imprimatur on the name choice, the name “NJweedman.com” does not seem to rise to that level. Nor should the fact that the name request is unusual be dispositive. Courts have approved name changes to single words, such as “Variable,” and to names that include punctuation marks, such as exclamation points. Not all courts have followed this path; a Pennsylvania court in 2000 affirmed a lower court’s rejection of a woman’s request to change her surname to the letter R on the ground that such a surname was “bizarre” and would therefore arouse suspicion. But even the New Jersey appellate court hearing Forchion’s previous petition noted, in its 2004 ruling, that “the name is not so bizarre as to call for denial of the request on that basis.”

But denying a name change petition on the ground that it may lead others to read about the petitioner’s views on controversial matters – even if those views can be characterized as supporting illegal activity – seems to create difficult boundary problems. A name change inspired by a reclaiming of one’s heritage, for example, may connect that individual to new or additional communities, but it would be problematic to suggest that a court’s view of that community should be the basis for rejecting the change. The fact that Forchion’s requested name change is also the URL of the site may well inspire a few who encounter Forchion to visit the site. But given Forchion’s own self-promotion efforts – and the media stories that have resulted, many of which use Forchion’s adopted name in any event – any such effect seems to be a thin justification for deeming the name change improper. Indeed, the fact that the court stated that the URL “should not also serve as Forchion’s personal name as long as he uses the Web site to encourage others to violate the law,” thus suggesting that the name would be appropriate were the content of the website to change, raises interesting First Amendment implications.

Here, the words of an Ohio appellate court seem relevant, when, in 2005, it granted a petitioner’s request to change his name to “Sacco Vandal,” after the anarchist Nicola Sacco and the Germanic tribe. “It’s a free country,” the court wrote. “The applicant is a grownup. He can change his name to anything he wants so long as the new name is not clearly improper or unreasonable . . . . If the applicant is using the name change to make a statement to society – and most applicants do – it is a subtle one.” The statement that Forchion is making by calling himself NJweedman.com may be considerably less subtle, but that does not mean it is without expressive content.
___________

Eric's comments

I agree with Laura's comments that the court's rationales for rejecting the name change are indefensible. It seems that the court implicitly--and improperly--shifted the burden onto Forchion to have a good reason for the name change, instead of retaining the burden to provide a good reason why the name change was problematic.

I was especially unpersuaded about the possibility that the NJWeedman.com domain name would end up in someone else's hands. If this is the court's concern, Forchion could have prepaid the domain name registration for the maximum length permissible, which I believe is at least a decade. That wouldn't have changed the fact that Forchion could still lose the domain name due to a breach of the registration agreement, but I believe those interventions are exceedingly rare. So the "permanence" of a domain name registration could be largely addressed through cash, and the court cut an analytical corner by treating a domain name registration as impermanent.

I'm also scratching my head because Forchion can still effectuate a common law name change, which will give him 90% of the website publicity traffic he seeks. So it's not clear how the court actually advances its policy concerns by denying the official name change.

More generally, despite Laura's scholarly work, state policies governing name spaces remain undertheorized and under-scrutinized. For example, as I blogged on my personal blog, California went decades with a facially illegal distinction in its marriage license, letting the woman take the man's name but not letting the man take the woman's name. California finally fixed this problem with a statute in 2007. For more discussion on government policies towards personal names, see these articles on marriage names and baby names). Another government-operated namespace that doesn't get much attention are vanity automobile license plates; we've seen a variety of questionable government policies emerge there without much pushback.

FWIW, because I changed my name to Eric Goldman from Eric Schlachter, the name Eric Schlachter is freely available for other takers (although, I should point out, there are a few other Eric Schlachters currently using the name). As I mentioned in this blog post, anyone else is free to adopt "Eric Goldman" too, but I plan to defend my favorable search engine placement vigorously!

Posted by Venkat at 08:41 AM | Domain Names , Publicity/Privacy Rights , Trademark

August 29, 2011

Bev Stayart Racks Up Two More Losses--Stayart v. Yahoo and Stayart v. Google

By Eric Goldman

Stayart v. Yahoo, Inc., 2011 WL 3625242 (E.D. Wis. Aug. 17, 2011)
Stayart v. Google Inc., 2:10-cv-00336-LA (E.D. Wis. Aug. 17, 2011)

Persistence is a virtue, but sometimes, enough is enough. You probably remember Bev Stayart as the woman who was upset that sploggers had built pages associating her name with the drug Levitra. In a litigation campaign now spanning 2 1/2 years, she has sued both Google and Yahoo for showing these splogged results. Her lawsuits have gotten zero traction. See the end of this post for my prior blog posts on her futile campaign.

The most recent rulings address her motions to reconsider the dismissal of her publicity rights claims, as well a dismissal in the Yahoo case for lack of subject matter jurisdiction and a motion in the Google case for attorneys' fees. Stayart avoids paying Google's fees--which I would have enthusiastically awarded against her if I had been judge--so I guess she might call that a win. She loses everything else.

The court rejects Stayart's publicity rights claim under Wisconsin's statute. It says that Stayart must establish a substantial connection between her name and advertising, not a de minimis or incidental connection. She didn't do that; her allegations only suggest that "defendant reported the results of its search of other websites." The court wraps up this point by saying:

Because it is not a misappropriation to use a person’s name primarily for the purpose of communicating information, displaying these search suggestions does not provide a basis for plaintiff’s claims.

The court doesn't cite the Habush v. Cannon ruling (also interpreting Wisconsin publicity rights law, although that case involved ads), but I think its ruling is philosophically in sync with that case.

In the Google case, Stayart pointed out that a keyword search for "bev stayart levitra" triggered ads for Levitra. The court, without using the phrase "broad matching," concludes that the logical conclusion is that the ads are based on broad-matching to Levitra. The court's discussion isn't so definitive that this language will be followed as precedent, but the court's reasoning would help defendants in keyword advertising lawsuits where broad matching is involved as well.

In the Yahoo case, the court dismisses subject matter jurisdiction because she didn't clear the $75,000 threshold. She tries to count the possibility of punitive damages towards the $75,000, but noting the Gore case, the court says:

Even assuming that punitive damages were available, such damages would necessarily be limited given the de minimis nature of the compensatory damages alleged.

The court couches the discussion in fairly turgid legal prose, but the message is clear: Bev Stayart's claims substantially overread the law, and she hasn't suffered any damage the court is going to recognize. Most plaintiffs would get the hint and cut their losses.

Among other consequences of her litigation campaign, Bev Stayart's litigation campaign has irrevocably changed the search results on her name. Instead of associating her with sexual dysfunction drugs, her search results forevermore will be associated with unmeritorious litigation. Thus, I still fail to understand why these lawsuits aren't fundamentally counterproductive to her apparent goal of improving her online reputation.
____

Prior blog posts:

* Google Not Liable for Suggested Vanity Searches--Stayart v. Google
* Seventh Circuit Tosses Beverly Stayart's False Endorsement Claims--Stayart v. Yahoo
* Beverly Stayart Strikes Again! This Time, Stayart Sues Google
* Yahoo's Search Results Snippets Aren't False Endorsement--Stayart v. Yahoo
* Yahoo/Overture Sued for Search Results Snippets Containing Plaintiff's Name--Stayart v. Yahoo

Posted by Eric at 10:12 AM | Publicity/Privacy Rights , Search Engines | TrackBack

August 05, 2011

TheDirty Defeats Publicity Rights Claims--Gauck v. Karamian

By Eric Goldman

Gauck v. Karamian, 2011 WL 3273123 (W.D.Tenn. July 29, 2011)

TheDirty.com has an increasingly active litigation docket. This case comes from Lauren Lee Gauck Giovanetti, a TV news reporter for Fox 13 in Memphis, Tennessee. She sued over two user-submitted posts to TheDirty that claimed she "used illicit drugs, was sexually promiscuous, exchanged sexual favors in return for drugs and money, and assaulted an unknown person." The posts contained photos of her and several nude photos that also claimed to be of her, but she denied that claim. As usual, Nik Richie added his terse and snarky comments to the user posts. He also watermarked the photos and covered up portions of the nude photos.

Gauck sought an injunction based on her publicity rights. The court sidesteps the obvious 47 USC 230 defense, assuming without deciding that the publicity rights claim would fit into 230's IP exception.

Instead, the court rejects the injunction request on the merits of the publicity rights claim. This is based on the specific wording of Tennessee's publicity rights statute, which applies only to advertisements or solicitations. TheDirty made a commercially motivated editorial usage of Gauck's name and image. This type of usage gives courts fits, especially when the editorial publication isn't a traditional journalistic enterprise like a print newspaper. (See more about that problem in trademark law). Even so, there was no way to interpret TheDirty's "editorial content" as an advertisement or solicitation. The court says:

Plaintiff has offered no evidence that Defendants marketed their site by emphasizing Plaintiff’s appearance on the site, used portions of the posts in teasers on other sites to draw more visitors, prominently displayed the posts regarding Plaintiff on the site, advertised Plaintiff’s appearance in connection with the sale of any of Defendants’ products, or charged higher premiums to advertisers for advertising space on the pages pertaining to Plaintiff.

The court rejects Gauck's generalized assertion that TheDirty's editorial content generates more ad money because it deals with celebrity gossip:

Plaintiff has suggested, at most, a currently unsubstantiated connection between the general use of celebrity personas on the site and an increase in traffic and/or advertising revenue.

I think that line of inquiry was irrelevant if we maintain the artificial distinction between editorial content and advertising. If the statute applies only to advertising, then it shouldn't matter if editorial content becomes more interesting because it addresses third party personalities. But the distinction truly is artificial--editorial content is its own form of marketing, i.e., more interesting editorial content naturally draws in more readers. The court didn't make a misstep here, but it could have been sharper or more succinct.

More coverage of TheDirty litigation:

* TheDirty Defeats Privacy Invasion Lawsuit--Dyer v. Dirty World
* thedirty.com's 47 USC 230 Defense Rejected on Motion to Dismiss--Jones v. Dirty World Entertainment

Posted by Eric at 11:32 AM | Derivative Liability , Publicity/Privacy Rights | TrackBack

July 29, 2011

Court Smacks Down Koch Industries' Attempt to Shut Down Satirical Website -- Koch Industries v. Does

[Post by Venkat Balasubramani]

Koch Industries, Inc. v. Does, 10CV1275DAK (D. Utah; May 9, 2011) [.pdf]

[This is one of those cases that I intended to cover when it came out, but it got lost in the shuffle. Eric talks about his 'backlog' of blog-worthy cases that he tackles from time to time. I prefer to view it as a quagmire that I wade in and out of.]

EFF, Public Citizen and other similar organizations have excellent resources for creators of parody and satire on the internet. A recent case (litigated by Public Citizen) illustrated a few pitfalls a plaintiff--who is seeking to shut down such non-commercial content--may face. A commercial motivation does not automatically doom a parody or satire defense, but the total absence of a commercial motive will neutralize a plaintiff's claims.

A group who identified themselves as "Youth for Climate Change" set up a faux website at "koch-inc.com" at which they purported to announce Koch Industries' official shift in position towards groups who undertake climate change research and advocacy. The website was announced via a press release which was mailed to news organizations. The site was up for only a few hours but drew a fair amount of media attention. The media quickly identified the site and release as a hoax. Koch sued, asserting claims under the Lanham Act, the cybersquatting statute and the Computer Fraud and Abuse Act. Koch requested and obtained the court's permission to issue subpoenas in order to determine defendants' identity. Defendants appeared, moved to quash the subpoenas and moved to dismiss. The court dismisses the lawsuit, and grants defendants' request for a protective order, keeping their identity under wraps.

Lanham Act and Cybersquatting Claims: Both the Lanham Act and ACPA claims were dead-on-arrival, since defendants' press release did not relate to any goods or services. There was no reference to Koch's products or even to any of Koch's business practices. Koch tried to argue that defendants set up the fake website to draw attention to defendants and to ultimately raise funds for defendants' activities but the court rejects this argument, noting that defendants "did not identify their website or provide a means for making a contribution to [defendants'] entity." In fact, neither the press release nor the fake website contained a link to defendants' website. Koch asserted a similar argument with respect to its ACPA claim but the court notes that since defendants set up and operated the website "completely anonymously . . . the only agenda [defendants] could have been promoting was [their] message, not any entity." Again, the court notes that defendants' anonymity made any donations impossible.

CFAA Claim: Koch also asserted a Computer Fraud and Abuse Act claim and this claim fared no better. This claim was presumably based on defendants' access of the Koch website in the course of preparing their fake press release. The court found that Koch made its website available to the general public. Although the website contained a restriction that "competitors" were not permitted to access the website, the court found that defendants did not agree to this restriction since it was "buried" at the bottom of the first page. Koch cited to Specht v. Netscape for the proposition that browsewrap agreements are normally enforceable but the court notes that this case, and others cited by Koch, were all decided in the commercial context. Koch was unable to identify "a single case imposing 'contractual' speech restrictions on noncommercial web users."

Other coverage:

"Utah Court Strikes Blow for Free Speech, Dismisses Trademark and CFAA Claims Against Political Activists" (EFF)
"Court Protects Hoax Press Release" (Bill McGeveran)
"In Which We Lose Our Funding And Are Reduced To Eating Gravel" (Popehat)
"In Koch spoof case, judge favors First Amendment" (CitizenVox)

Posted by Venkat at 10:33 AM | Publicity/Privacy Rights

July 08, 2011

NJ Appeals Court: No Privacy Violation When Spouse Uses GPS to Track Vehicle -- Villanova v. Innovative Investigations, Inc.

[Post by Venkat Balasubramani]

Villanova v. Innovative Investigations, Inc., et al., A-0654-10T2 (N.J. Ct. App. July 7, 2011)

A New Jersey appeals court decided that a wife's use of a GPS device to track her husband's movements did not violate the husband's privacy rights.

Background: The plaintiff was married, and his wife suspected him of having an affair. The wife hired an investigative firm (the defendants), who conducted a preliminary investigation. It recommended that the wife place a GPS device in the husband's car in order to better track his movements and assist with the investigation. The wife purchased the device [through the internet, of course!] and placed it in the glove compartment of the husband's Denali, where it remained for forty days. The wife sporadically checked the GPS device's movements online and passed along the information to defendants. Defendants used the information to conduct their investigation, which did not seem to yield any information that I would characterize as a blockbuster. The closest the investigators came to a confrontation with the plaintiff is when they waited outside the home of the woman the husband was suspected of having an affair with, and observed the husband and this woman in his car. The investigators followed the car, but the husband realized he was being followed.

The husband brought invasion of privacy claims against the investigative firm and its principal. (The husband waived his privacy claims against the ex-wife in the divorce settlement.)

Discussion: The court notes the four types of invasion of privacy claims under New Jersey law: (1) intrusion, (2) public disclosure of private facts, (3) false light, and (4) misappropriation. Here, plaintiff argued that his (now-ex) wife and the firm intruded upon his solitude. Intrusion requires a showing that the intrusion would have been "highly offensive to the reasonable person." A defendant is only liable if he or she "intrudes into a private place."

The court rejects the plaintiff's claims finding that:

There is nothing [in the record] to support an inference that any surveillance of plaintiff extended into private or secluded locations that were out of public view and in which plaintiff had a legitimate expectation of privacy.

Additionally, the court found that there was no evidence that the wife passed along any private location tracking information to defendants:

a factfinder might, at the very most, infer that [the wife] verbally passed on to defendants information from the GPS company's reports and that defendants used that information as a basis for proceeding on July 28, 2007 to the Heritage Road area. However, there is nothing to establish that any possible invasion of plaintiff's privacy and seclusion ever occurred. Such a finding would require that [the husband] was in a location where he had a reasonable expectation of privacy.

Based on this, the court finds that summary judgment was properly granted to defendants.
___

Divorces seem to be fertile grounds for court decisions around privacy and technology. (See, e.g., my post on Miller v. Meyers, an email access case: "Court: Husband's Access of Wife's Email to Obtain Information for Divorce Proceeding is not Outrageous.")

There was an interesting fact that didn't receive as much as attention as I thought it should: the car was jointly owned. I'm surprised the court did not discuss the fact that since the wife owned the car, she could have argued that she had the right to track its movements. (On a related note, the plaintiff, who was a police office, tried to argue that he used the car for law enforcement purposes once in awhile, but the court is extremely skeptical of this argument.) Another fact that the court did not focus on directly is whether the result would have been different if the investigative firm (rather than the wife) was the one who did the GPS tracking. Kash Hill's post makes this point.

It was also interesting that despite using a "reasonable expectation of privacy" standard, the court does not discuss the diminished expectation of privacy for the husband vis a vis his wife . . . who is trying to investigate him for having an affair. I'm not suggesting that spouses waive their privacy rights with respect to one another, but if you're having an affair, is it not reasonable to expect that your spouse may be checking up on you? In Miller v. Meyers, the email case, the court notes:

A husband prying into his wife's email, after learning that she was engaging in conversations and photo sharing, and then using damaging emails in a divorce and custody proceedings can hardly be considered "extreme and outrageous," "beyond all possible bounds of decency," or "utterly intolerable in a civilized society."

I wondered whether the same could be said of this case. Here, the wife's argument is even stronger, because she's not allegedly violating any other statutes intended to protect the privacy of electronic communications.

GPS tracking is one of those areas where technology and notions of privacy clash. The case law says that you have no expectation of privacy when you are in a public space, but a GPS device can track your every movement in a way that someone who physically followed you in a car couldn't conceivably do. The argument from privacy advocates is that GPS tracking--particularly long-term tracking--reveals more information than could be obtained if you physically followed someone. This was one of the arguments made by the federal appeals court in D.C., which held that warrantless GPS tracking caused Fourth Amendment problems because, among other things, "the sequence of a person’s movements may reveal more than the individual movements of which it is composed." (The Supreme Court accepted review of this case, as noted in this Wired article: "Supreme Court to Decide Constitutionality of Warrantless GPS Monitoring." A slew of federal appeals courts have come to the opposite conclusion that warrantless tracking of a car does not cause any Fourth Amendment problems.)

A final note is that private investigators have it tough these days. They definitely do not travel down a risk-free path in pursuing their investigations. Virtually any investigative decision would seem to cause concern that the subject will assert some sort of privacy claim. I suppose this was always true, but as technology improves, it becomes much easier to eavesdrop and track in a way that creates a greater risk of liability for the investigator.

Other coverage:

"Judges Say It’s Okay To Use GPS To Track a Cheating Spouse" (Kash Hill)

Posted by Venkat at 09:00 AM | Publicity/Privacy Rights

June 29, 2011

Court Dismisses Misappropriation Claims Against Facebook Over Its Friend Finder Service -- Cohen v. Facebook

[Post by Venkat Balasubramani]

Cohen v. Facebook, C 10-5282 RS (N.D. Cal. June 28, 2011)

There are a slew of publicity rights lawsuits pending against Facebook. This one alleged that Facebook misappropriated the names and likenesses of Facebook users by suggesting to Facebook users that their friends had utilized the "Friend Finder" service. (Ironically, Facebook's friend finder service looks similar to the service Power.com offered and which Facebook is trying to shut down.) Plaintiff brought a putative class action, alleging state law misappropriation, Lanham Act, and unfair competition claims.

Facebook's user agreement: Facebook argued that the consent contained in Facebook's terms of use barred plaintiff's claims. Facebook argued that its terms contained a broad license that was limited only by privacy settings for particular types of content:

For content that is covered by intellectual property rights, like photos and videos ('IP content'), you specifically give us the following permission, subject to your privacy and application settings: you grant us a non-exclusive, transferable, sub-licensable, royalty-free license to use any IP content that you post on or in connection with Facebook ("IP License").

According to Facebook, an end user's name and profile picture have no privacy settings and therefore there were no limitations on the clause quoted above (i.e., no limitations on Facebook's right to use end user photos and user names). Judge Seeborg, disagreed, noting that:

a more natural reading of the provision is that it gives Facebook a worldwide license to reproduce any pictures or text posted by a user, subject to any privacy settings, that would insulate it from any copyright claims by the user, whether or not the reproduction was made on 'Facebook'.

Facebook also argued that its users had no expectation of privacy in their name or profile picture, but the court notes that this does not bar a user claim for publicity rights. It's one thing to disclose a person's name and it's another to use it for endorsement purposes. Although the discussion is slightly confusing, the court's conclusion was that it's not totally clear that Facebook's terms freely allow Facebook to exploit a user's publicity or personality rights in this manner. The court also noted that there was nothing in the terms which ostensibly allowed Facebook to disclose to other users what services a particular user utilized. [Ouch! I think the conclusion is debatable, and despite Facebook's clunky user agreements, the quoted language is broad. To be on the safe side, if I were Facebook, I would expressly reference publicity and personality rights.]

Plaintiff did not sufficiently allege injury: In order to make out a claim for misappropriation of publicity rights, the plaintiff has to allege injury. Although plaintiff included a conclusory allegation in the complaint that she "suffered injury-in-fact," plaintiff did not allege any harm whatsoever. Injury to feelings is sufficient to assert a publicity rights claim, but plaintiff failed to allege this. Plaintiff argued that she was entitled to statutory damages even absent a showing of harm, but the court disagreed. Under the case law, a plaintiff who suffers no economic loss but suffers emotional harm may be entitled to the minimum damages amount, but plaintiff failed to allege that she suffered any "mental anguish" as a result of Facebook's alleged misappropriation.

Plaintiff's lack of commercial interest in her name undermines Lanham Claim: With respect to the Lanham Act claim, the court held that plaintiff had to allege some "commercial interest" in his or her name in order to assert a Lanham Act Claim. While the plaintiff need not be in "actual competition" with Facebook, the plaintiff had to have some "economic interest" in her name "akin to that of a trademark holder." Plaintiff argued that she had a commercial interest (at least within the group of her Facebook friends) but the court rejects this argument.

Unfair competition: Plaintiff's unfair competition claims was derivative of her publicity rights claims and therefore were dismissed. The court also adds that apart from the injury issue, plaintiff is not likely to be able to show that she has lost "money or other property." The remedies available via a section 17200 action have been sharply limited in recent years, and if a plaintiff cannot show that Facebook wrongly took money or property belonging to plaintiff, he or she will be out of luck. The fact that Facebook offers a free service to end users makes section 17200 claims useless for anything other than prospective injunctive relief. (One or two cases have recognized that personal information can constitute "property," but the court does not discuss that possibility here. See "Judge Recognizes Loss of Value to PII as Basis of Standing for Data Breach Plaintiff".)
__

I'd characterize this as a partial win for both sides. Judge Seeborg's view that the Facebook end user agreement did not bar the misappropriation claims has to make Facebook nervous. On the other hand, if plaintiffs are going to have to show that they suffered "mental anguish" as a result of Facebook's use of their names and profile photos and they have an economic interest in their names, these present obvious barriers. [I can just imagine Facebook's investigators trolling the internet for examples of use by plaintiffs of their own photos and names on other sites or on Facebook, to show that plaintiffs did not really exert any control over use of their names and photos by third party websites.]

Facebook may also have an opportunity to argue that the claims are not amenable to resolution on a class-wide basis, given that individual facts may affect the determination of whether a particular user suffered "mental anguish" as a result of Facebook's use of plaintiffs' photos and user names.

Of course, the reality is that this is a cobbled together class action based on allegations of harm that are tenuous at best. The result may be different if plaintiff alleged that Facebook used plaintiff's name and likeness to advertise third party products or services or even promote something outside the Facebook ecosystem, but telling someone's Facebook's friends that they used the "friend finder" services sounds like a weak publicity rights claim at best.

Plaintiff may be able to amend and get past another motion to dismiss, but this lawsuit will probably be shuttled to the dustbin of internet privacy lawsuits in short order.

Posted by Venkat at 03:14 PM | Licensing/Contracts , Marketing , Publicity/Privacy Rights

June 09, 2011

Buying Personal Names for Keyword Ads Isn't a Publicity Rights Violation--Habush v. Cannon

By Eric Goldman

Habush v. Cannon, 09-CV-18149 (Wis. Cir. Ct. June 8, 2011). The June 2010 denial of the motion to dismiss. A good overview article from when the complaint was filed.

Introduction

A Wisconsin court has said that a keyword advertiser didn't violate publicity rights by buying a person’s name for keyword advertising. Although the propriety of keyword advertising on a third party trademark has been hotly contested since at least 2004, I believe this is the first ruling addressing the publicity rights issue.

The legal novelty of the ruling makes it an important early precedent, but the opinion is not especially persuasive. To me, the judge seemed overwhelmed by both the challenging legal doctrines and technology at issue in this case. In response, the judge issued one of the most citation-free opinions of its length that I have ever seen. This is not a scholarly opinion, and that makes less likely to influence other courts. It also means that an appellate court will likely give this opinion relatively low deference.

The fact that the court dismissed the lawsuit is, on its face, good news for both search engines and advertisers. However, I thought the judge's arguments were questionable and, at least at one crucial juncture, internally inconsistent. The ruling turned on a specific word in the Wisconsin publicity rights statute, and courts applying other statutes can easily distinguish this opinion if they want to rule for the plaintiffs. Therefore, this ruling could morph from a defense win into a plaintiff's friend depending on how future courts rely on and interpret it.

Facts

The case involves two of the highest profile and most successful personal injury law firms in Wisconsin. The defendants bought two of their competitors' last names ("Habush" and "Rottier") for keyword ads at Google, Bing and Yahoo, in some cases bidding enough to ensure the first ad position. The ad copy didn't display those last names.

The plaintiffs sought an injunction. However, in that sense, the plaintiffs may have gotten a de facto extrajudicial win. It appears the defendants have stopped the ad campaign. Neither the court nor I could replicate the ads any more.

The Prima Facie Case

The court holds that the keyword ad buys satisfied the prima facie elements of a publicity rights claim but one. Among other arguments, the defendants argued it didn’t "use" the name "for advertising purposes or purposes of trade." This argument recalls the old and loquacious trademark battles over what constitutes a "use in commerce." The non-"use" defense doesn't get any more traction here than it did in the trademark cases. The court thinks it’s irrelevant that the "use" is invisible to consumers: "the simple, plain English meaning of the word ‘use’ certainly includes the purchase of a name to trigger results from a computer algorithm." Thus, the court concludes:

the defendants used plaintiffs‘ names for advertising and trade purposes without the plaintiffs‘ consent. Thus, plaintiffs have established that, under Wis. Stat. § 995.50, defendants invaded their privacy.

"Unreasonably"

It looks like the plaintiffs are home free. But then, the court says that the plaintiffs must also show that the defendant's use was "unreasonable." This appears to have been a contentious battle over the prima facie requirements; see lengthy FN9 and this transcript from March 2010.

The court then explains why a "privacy invasion" by buying keywords ads was reasonable in this case, including:

* positioning keyword ads by organic results is analogous to competitive adjacencies, such as competitors locating their stores next to each other and advertisers bidding against each other for prime positions in Yellow Pages. In the trademark context, I thoroughly examined these arguments in my uncited Brand Spillovers article. The judge sees the defendant lawyers' ad buys as "energetic business competition." Kudos to the judge for recognizing that keyword ads are usurping lawyers' Yellow Pages ads.

* the specific names here (Habush and Rottier) are part of their law firm's name, and the court says their publicity rights effectively merge with the firm's trademark. In other words, a person searching for "Habush" might be looking for the firm, not the lawyer, and it's impossible to separate those searcher motivations.

* users aren't confused by keyword ads (nor did the plaintiffs show any confused consumers), consumers scan the results page to find what they are looking for, and any confusion they experience will be brief (no acknowledgement of the abominable initial interest confusion doctrine). Further, "Internet users, and consumers in general, have learned to be skeptical about the first impression they may receive from a web page or commercial advertisement." If only that were unequivocally true!

* search engines are evolving, and the court can't figure out what an injunction would look like given how search engine user interfaces might change.

* no attorney ethics rules have banned these keyword advertising practice.

All of these are interesting and meritorious public policy considerations. None of them got any meaningful empirical or legal precedent support for the judge's arguments. An appeals court will feel free to substitute their own considerations for the judge’s proffered rationales.

Also, notice the problem with this court's solution. Other publicity rights statutes may not have the word "unreasonable" in their statutory language, and common law publicity rights doctrines may not require "unreasonableness" either. As a result, where the publicity rights doctrine doesn’t require defendants to engage in “unreasonable” usage, this ruling says pretty clearly that competitively buying a person's name is a publicity rights violation—in other words, what could be a clean win for the plaintiffs. I don't think this judge intends that result, but it’s the implications of the judge’s doctrinal solution.

Defenses

The court rejected the unclean hands defense. It appears that the plaintiffs' firm had bought category ads in some Yellow Pages sites, which caused their ads to show up on the defendants' firm listings in those categories. The court logically distinguishes category ads from keyword ads, though the 9th Circuit's Playboy v. Netscape panel treated them as equivalent.

The court also rejected a First Amendment defense because buying keyword ads is conduct, not speech: "This lawsuit involves the hidden process which causes the link to appear at all. That process is content neutral. It is not information; nor is it a message of any sort. It is not speech, commercial or otherwise."

What??? First, the court ahistorically ignores the 1990s-era rulings about encryption software and the First Amendment. Second, I believe this is internally inconsistent with the court's conclusion that the publicity rights statute applies to invisible activity (i.e., a use of a person’s name that a consumer never sees). The court seems to be saying that conduct without speech can constitute a publicity rights violation, and I don't see how that's possible. My position is that publicity rights violations necessarily require the defendant to engage in speech; so conduct without speech can never satisfy the statutory requirements.

Implications

This opinion got to the right result, but its reasoning is shaky and the opinion was poorly constructed and inadequately cited. The plaintiffs have already vowed to appeal—a fact the judge anticipated as you can see in the March 10, 2010 transcript. (After all, litigators litigate—and good litigators savor the challenge). Given the opinion’s weakness, I would be surprised if the appellate court relied very heavily on this opinion's analysis. However, I hope the appellate court recognizes that the judge's policy concerns were spot-on and finds a way to respect those concerns.

I can't take the lead on an amicus brief in the appeal, but I would be interested in actively supporting the effort. Contact me if you would be interested in working together on one.

Irrespective of what happens on appeal, I can't imagine this opinion will be the last word on publicity rights and keyword advertising. If you are looking for a paper topic, I think that issue offers a few promising angles to explore.

Finally, this opinion complements the uncited Stayart v. Google, which also involved alleged violations of Wisconsin's publicity rights statute and ended in favor of the defense. The Stayart v. Yahoo 7th Circuit opinion turned on the Lanham Act, but it too is relevant. I don’t have a good explanation why Wisconsans are trail-blazing litigation over search engine use of their names.

Posted by Eric at 07:04 AM | Marketing , Publicity/Privacy Rights , Search Engines | TrackBack

June 06, 2011

April-May 2011 Quick Links, Part 3

By Eric Goldman

Search Engines

* Google is working on a deal with the DOJ over illegal pharmaceutical ads and has set aside $500M for fines. Some background on the problem. Google isn’t the only search engine with problematic pharmaceutical ads. Will the other companies be getting the DOJ’s call too?

* Kevin Kelly: "This is the great gift of the free web. It has made some goods so cheap to acquire -- like answers, encyclopedia facts, directions, weather reports, recommendations -- that we generate entirely new realms of activity by doing far more of them. More is different. We ask so many more questions than before that this ask-and-answer is something new. Have you ever wondered where all our questions were before search engines? We didn't even bother to ask them."

* Vitaly Borker, who tried to game Google’s algorithm by seeking out bad consumer reviews, will be going to prison.

* Google won ALM's Best Legal Department in 2011. This article has a great inside look at Google’s legal department and how it makes decisions.

* More winners and losers from Google's algorithmic update.

* Latest antitrust enforcement challenge for Google: South Korea.

* More search censorship in Argentina. The ruling in Spanish.

* Yahoo changed its search log retention period from 3 months to 18.

* Market America is appealing its court loss to Google to the Third Circuit. Most recent blog post.

* Apple jiggers with the ranking algorithm for apps in its app store.

* CNET: “Bing head says 'traditional search' is dying.”

* Realcomp II, Ltd v. FTC, 11a0084p.06 (6th Cir. April 6, 2011). A monopolistic real estate electronic network violated antitrust laws when it provided only limited syndication of real estate listings subject to non-standard brokerage fee arrangements. Implications for Google?

* JC Penney’s 90 day timeout from Google for black hat SEO appears to be over.

* Gord Hotchkiss: “Why Results Quality Is So Important to Search Engines”

Privacy and Security

* Facebook tried to conduct a whisper campaign to bash Google on privacy. That backfired. Steven Levy: “Facebook’s Stealth Attack on Google Exposes Its Own Privacy Problem.” Danny Sullivan: “How Facebook Enables The Google Social “Scraping” It’s Upset About.”

* Not everyone loves the WSJ “What They Know” series.

* Kate Kaye of ClickZ on which of the half-dozen Congressional privacy bills the ad industry should favor.

* WSJ: Schmidt: Google Trying to Simplify Privacy Policies, but Lawyers Get In the Way.

* Less than 1% of Firefox users are using Do Not Track TPLs.

* Third party misuse of an open wifi leads to an unhappy wake-up call for the wifi owner.

* FTC gets $3M settlement from Playdom for COPPA violations. Among other purported defects, Playdom asked kids their ages and purported to bounce underage kids, but gave those kids the option to proceed just by checking a box rather than obtaining verifiable parental consent.

* An IP address can now pin down your location to within a half mile.

* The Sony Playstation hack of 70M member records will probably make my year-end list of top 10 Internet law developments. This event will be horking the law for the better part of a decade.

* EFF on how the Kerry-McCain privacy bill would preempt state law.

* Apple tried to squash the Mac Defender malware in its latest operating system release, but didn't get very far. Microsoft has made such benevolent dictatorship decisions before as well.

Publicity Rights and Trade Secrets

* Reality TV show participants were sued for prematurely revealing the show's outcome (in a lawsuit over the show's alleged failure to pay). See my first year Contract Law problem on maintaining secrecy in reality TV shows.

* Stars on the red carpet grant an implied license to their publicity rights in photos taken there.

* Basketball player Chris Bosh sues the mother of his child to prevent her from appearing in a reality TV show “Basketball Wives.”

* Larry Montz v. Pilgrim Film and Television, 08-56954 (9th Cir. May 4, 2011). In an idea submission case, “We again hold that copyright law does not preempt a contract claim where plaintiff alleges a bilateral expectation that he would be compensated for use of the idea, the essential element of a Desny claim that separates it from preempted claims for the use of copyrighted material.” The panel also reversed the district court conclusion that a “breach of confidence” claim was preempted.

* Many publicity rights complaints over Facebook's "Sponsored Stories": Fraley v. Facebook; JN v Facebook; and EKD v. Facebook. Filings in the Cohen v. Facebook case: motion to dismiss and supplemental brief on 47 USC 230.

* Litigation over Donald Trump’s licensing of his name to home developers. Interesting issues about a trademark licensor’s liability for a licensee’s activity and liability by endorsers for bum offerings.

* MGA spent $130M in its legal battle with Mattel.

Posted by Eric at 07:19 AM | Privacy/Security , Publicity/Privacy Rights , Search Engines , Trade Secrets | TrackBack

June 04, 2011

TheDirty Defeats Privacy Invasion Lawsuit--Dyer v. Dirty World

By Eric Goldman

Dyer v. Dirty World LLC, 2011 WL 2173900 (D. Ariz. June 2, 2011). The summary judgment motion, Dyer's opposition and thedirty's reply.

An ex-boyfriend submitted to thedirty.com 2 photos of Dyer in a bikini and a comment that Dyer gave him and a buddy an STD. Nik of thedirty posted, in response to his standard "Would You?" question, "No it looks like she just had a baby, and if a girl is willing to take 2 guys on then I suggest you use a rubber." Dyer sued thedirty for public disclosure of private facts and false light. For reasons that aren't explained, Dyer didn't sue for copyright infringement for the republished photos (although I vaguely remember these may be self-portraits) or defamation (even though the complaint repeatedly alleges that the statements are false); nor does it seem that she sued the ex-boyfriend either.

Another oddity: the final posting on thedirty had three disparate information pieces--the photos, the submitted comments, and Nik's comments--but the court appears only to evaluate Nik's comments, which are characteristically acerbic but comparatively innocuous. Nik only advanced two statements: an opinion about Dyer's looks and a recommendation for safe sex practices when engaging multiple sex partners. As a result, the court says that Nik didn't make any statements of fact. The court concludes "the Court finds that the general tenor of Defendant’s website makes clear that the two statements at issue represent Mr. Ritchie’s personal viewpoint, rather than an assertion of fact."

However, the court doesn't explain why it effectively ignores thedirty's republication of the photos and the submitted comments. In FN2, the court says it's not relying on 47 USC 230, but if that were really true, it seems that the court should have considered all three information pieces, not just Nik's own words. So it appears that this is a 47 USC 230 case where the court denies it's relying on 47 USC 230.

Prior coverage of a different thedirty case: "thedirty.com's 47 USC 230 Defense Rejected on Motion to Dismiss--Jones v. Dirty World Entertainment"

Posted by Eric at 09:43 AM | Derivative Liability , Publicity/Privacy Rights | TrackBack

May 25, 2011

Ohio Appeals Court: GoDaddy can be Held Liable for Wrongly Transferring Control Over Domain Name and Email Accounts -- Eysoldt v. ProScan

[Post by Venkat Balasubramani]

Eysoldt v. GoDaddy, et al., C-100528 (Ohio Ct. App.; May 18, 2011)

Actions against registrars for allowing domain names to be wrongly transferred have been relatively rare. Members of the Eysoldt family brought claims against GoDaddy alleging these types of claims. A jury ruled in their favor and the Ohio Court of Appeals declined to set aside the verdict.

Jeff Eysoldt registered Eysoldt.com through GoDaddy. He used this account for personal purposes--he stored photos and used it for email, and he allowed other family members to do so. He also registered and managed a domain name for his sister's business through this account. Separately, he entered into a business arrangement with ProScan, and the parties sought to build out a website which would promote cosmetic surgery centers. As part of this project with ProScan, he registered Myrejuvenate.com and placed this domain name in the same GoDaddy account as his personal domain name and his sister's domain name.

The relationship between Eysoldt and ProScan soured, and ProScan sought control of the domain name and the website. One of the ProScan executives called GoDaddy directly. GoDaddy's customer service representative saw that the domain name was registered under Eysoldt's name but "verified" the account information with the ProScan executive by confirming the method of payment and account number used to pay.

GoDaddy gave ProScan control over the Myrejuvenate.com domain name. Unfortunately, it also gave ProScan control over the other domain names and associated email accounts in Eysoldt's GoDaddy account. Eysoldt contacted GoDaddy to fix the problem, but he was told he had to fill out a verification form and fax this along with his drivers license. He did this, but GoDaddy responded to him that his face was not legible in the copy of the drivers license. The ProScan executive also contacted GoDaddy and asked that the domain names other than Myrejuvenate.com be transferred back to Eysoldt, but this too was unsuccessful.

Ultimately, Eysoldt sued GoDaddy. He sued ProScan as well but settled with them. The jury ruled in favor of the Eysoldt and awarded him $50,000 ($20,000 for invasion of privacy and $30,000 for conversion). Two other Eysoldt family members were awarded $10,000 each ($7,000 for invasion of privacy and $3,000 for conversion). (Here is a link to the verdict form.)

GoDaddy made several technical arguments on appeal and the court rejects them all.

Economic Loss doctrine: GoDaddy argued that Eysoldt's claims were barred by the economic loss rule, but the court says that this rule only applies to negligence claims and not to intentional torts.

Conversion: GoDaddy argued that a domain name cannot form the basis for a conversion action because it is intangible property. The court says (citing to CRS Recovery, Inc. v. Claxton) that times have changed. A domain name is readily identifiable and can be converted. GoDaddy also argued that the family members could not assert conversion claims because they testified that they lacked any ownership interest in the accounts. On this point, the court ruled that there was sufficient evidence from which a jury could conclude that GoDaddy converted the "conditional email and private communications [of the family members] that were contained in the GoDaddy account."

Invasion of Privacy: Finally, GoDaddy argued that there was insufficient evidence to support an invasion of privacy claim because there was no evidence that GoDaddy accessed the email accounts. The court rejects this argument also, noting that Eysoldt testified that someone had accessed the emails. According to the court, the harm flowed from the disclosure and not the misuse of the emails. In any event, the court cites to the fact that GoDaddy took control of personal emails, websites, and communications and just handed them over to a third party.

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GoDaddy had a pretty tough argument here given the facts. To treat a domain name as anything other than valuable third party property would be a mistake by registrars. There was some confusion early on as to whether domain names are contract rights (which do not support conversion claims) instead of property, but courts have long moved on from this question. (See Kremen v. Cohen, CRS v. Claxton, Office Depot v. Zuccarini, Bosh v. Zavala, etc.) I'm surprised GoDaddy didn't raise an argument based on waivers or limitations of liability contained in its end user agreement, but the opinion does not discuss them.

The court's conclusion regarding the invasion of privacy claim is worth noting because the court did not take the approach numerous courts have taken in data breach cases and require any showing of out-of-pocket loss. The likely explanation for this is that the plaintiff here asserted claims under the "intrusion" theory, where the harm flows from the mere disclosure, rather than the misuse, of data, but this should require a showing that the accounts contained information that was of an intimate nature. The court alludes to this in describing what type of information was contained in these email accounts, but does not come out and explicitly state this or cite to any specific information which would support a claim of intrusion.

The court's conclusion that the other family members could recover for conversion also glosses over a few nuances. The sister had a domain name registered through GoDaddy, but the court does not connect the dots on how giving Proscan control over the GoDaddy account translates into a conversion claim for the other family members. The court instead focuses on the email accounts and notes:

[w]hile Jill and Mark [the other family members] acknowledged that the account was registered to Jeff, the evidence showed that each of them had email accounts set up within Jeff's account. Additionally, Jeff and Jill had created content for Jill's website for her business, Good Karma Cookies. When Go Daddy gave control of the account to Wallace and ProScan, Jill could not access her website. Likewise, Jill and Mark could not access their email accounts. Thus, as the trial court stated, 'there was sufficient evidence produced at trial that would support the jury finding that GoDaddy converted the conditional and private email communications of Mark and Jill Eysoldt that were contained in the GoDaddy account.'

The court's focus on control over email accounts and content does not square well with the cases which say that domain names can be converted because they are freely transferable and can be bought and sold. Under the court's approach, a registrar could be found liable for terminating access to an email or hosting account, and this sounds problematic.

[Eric's comment: indeed, I read this opinion as hinting that any cloud service provider could "convert" a user account's to the extent that service provider "wrongfully" "cuts off" the user's access to his/her own intangible files. I don't think the court means to go there, but holding that GoDaddy converted the emails (as opposed to the domain names) naturally leads to a very dark place.]

It's clear that courts are not reluctant to impose some sort of obligation on the part of registrars to guard against identity theft. Registrars may need to adopt authentication procedures as rigorous as the procedures that banks use to authenticate bank accounts. Of course, even this approach is not infallible, and not easy to implement, given that much of the customer service interaction between a registrar takes place over the phone. Another suggestion is for registrars to respond promptly to any claims by customers of domain name theft. Sending a canned response from customer service when a customer frantically emails saying that his or her domain name has been stolen is not going to look good in the eyes of the fact-finder.

I'm struck at how often people register business and personal domain names in the same account, and how often the web-person ends up registering the domain name for a project in his or her account, rather than in the name of the entity, or a separate account which both joint ventures have control over. The domain name as a bank account analogy is useful here, and if you are part of a joint venture, think about whether you would want to give your co-venturers sole control over the bank account.

Posted by Venkat at 09:20 AM | Domain Names , Internet History , Licensing/Contracts , Publicity/Privacy Rights

May 20, 2011

Court Allows Fair Credit Reporting Act Claims Against Spokeo to Move Forward -- Robins v. Spokeo

[Post by Venkat Balasubramani with comments from Eric]

Robins v. Spokeo, No. CV10 05306 ODW (AGRx) (C.D. Cal.; May 11, 2011)

I previously blogged about Spokeo, which is being sued for disseminating reports which allegedly contain inaccurate information about plaintiff. The court initially dismissed the lawsuit without prejudice due to plaintiff's failure to allege actual harm.

Plaintiff refiled its lawsuit and alleges harm sufficient to satisfy the court:

the court finds that plaintiff has alleged sufficient facts to confer Article III standing. Specifically, Plaintiff has alleged an injury in fact - the "marketing of inaccurate consumer reporting information about plaintiff" - that is fairly traceable to defendant's conduct - alleged FCRA violations - and that is likely to be redressed by a favorable decision from this court.

This just sounds like a formulaic recitation of harm, but it's good enough for the court. To allege standing under certain statutes you, just have to allege a violation of the statute. In other cases, you have to allege actual harm.

Apart from lack of standing, Spokeo argued that it is not a "consumer reporting agency" under the Fair Credit Reporting Act. Spokeo pointed its disclaimers which stated that the reports furnished by Spokeo "cannot be used for FCRA purposes." The court is not swayed by this argument and points to plaintiff's allegations that Spokeo marketed its reports to "HR professionals and potential employers." Plaintiff presented the court with some typical gotcha website copy that easily made the case at the pleading stage that regardless of what the disclaimers said, Spokeo intended the reports to be used for employment and credit verification purposes.

Spokeo also argued that it was entitled to protection under Section 230. The court punts on the Section 230 issue. The court's discussion of this issue is somewhat disappointing in that it gives the parties very little to work with as far as how the court will ultimately deal with the issue. The details around how the collection and dissemination of information occur could end up being important to the Section 230 analysis. (Prof. Goldman's post on Accusearch discusses this: "Roommates.com Infects the Tenth Circuit--FTC v. Accusearch.") Spokeo should be able to take in information from various agencies, aggregate it, and redistribute it without losing Section 230 protection. (See, e.g., AOL v. Drudge.) To the extent Spokeo is just taking in reports that third parties already create, it should be difficult for plaintiff to argue that Spokeo falls under the Ninth Circuit's Roommates decision and somehow plays a role in the creation of the content. It's also worth separating the "score" assigned by Spokeo, with respect to which Spokeo will likely be able to argue some First Amendment protection (see Brown v. Avvo), from the information that is taken in from third parties and disseminated. Maybe the pleadings and the briefing didn't highlight what exactly whether plaintiff was complaining about the information that came from third parties or the "score" assigned by Spokeo, but these seem like issues the court could have delved into in order to provide some clarity to the parties.

The court also dismisses plaintiff's claims under California's unfair competition statute on the basis that the plaintiff did not allege that he "lost money or property" as a result of the unfair competition. Here the court finds that the plaintiff's conclusory allegations of lost income from continued unemployment are insufficient.

Previous post: "Court Dismisses Class Action Against Spokeo for Lack of Standing"
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Eric's comments

The court's 47 USC 230 discussion is terse. The entire substantive discussion:

Defendant asserts that it is immune under the CDA because it is an “interactive computer service” that “passively displays content that is created entirely by third parties.” Plaintiff, however, alleges that CDA immunity does not apply to Defendant because unlike information content providers that simply reorganize information obtained from other content providers, “Defendant develops original content based on information obtained from a variety of sources and posts it online[.]” Accordingly, application of the immunity is not clear at this time and the Court declines to dismiss the Complaint on this basis.

This could be another example of a judge being too cautious to use 230 on a motion to dismiss. The court appears to have allowed the bald assertion that Spokeo "develops" content to survive the dismissal motion. As Venkat says, what the judge should have done is require the plaintiff to be more specific about exactly what Spokeo did to develop the content.

We've seen a couple other recent examples where courts have let bald assertions like this survive a 230 dismissal, only to come to its senses at the summary judgment stage and decide 230 applied after all. (See the Kruska and Smith cases). My guess is that something similar will happen here too, with the twist that anything Spokeo actually develops will be its protected opinion (much like the Avvo case, as Venkat notes). A late 230 defense is better than no 230 defense, but it still incurs a lot of needless costs and wasted motion. It's unfortunate this judge wasn't more aggressive at policing the obvious 230 issue at the pleading stage.

Posted by Venkat at 08:08 AM | Derivative Liability , Publicity/Privacy Rights

May 19, 2011

Plaintiff Can't be Forced to Accept Defense Counsel's Facebook Friend Request in Personal Injury Case -- Piccolo v. Paterson

[Post by Venkat Balasubramani]

Piccolo v. Paterson, No. 2009-04979 (Pa. Ct of Common Pleas; May 5, 2011) [.pdf]

In addition to cases dealing with whether Facebook posts are discoverable in civil cases, courts and litigants continue to grapple with the logistical issues of how a party seeking such evidence can get access to it, or make arguments about whether or not they are entitled to access certain information contained in the profile.

Piccolo v. Paterson was a personal injury case where the plaintiff claimed she suffered lacerations to her face from the impact of an air bag. In her deposition, she was asked whether she posted pictures to Facebook and she said yes. Defense counsel asked if Piccolo would accept a "neutral" friend request from defense counsel so defense counsel could view the pictures. Piccolo later demurred, stating that the "materiality and importance of the evidence ... is outweighed by the annoyance, embarrassment, oppression and burden ...." Defense counsel brought a motion to compel. Defendant cited to McMillen v. Hummingbird Speedway, where the court ordered the plaintiff to provide his Facebook password to defense counsel.

The court rejected defendant's arguments, noting that defendant had already been provided an accurate photographic representation of the relevant evidence. As the Legal Intelligencer notes:

Piccolo [the plaintiff] allowed the insurer to come to her home in 2008 and take photographs of her face. She also gave the defense 20 photos of her face from the week following the accident as well as five photos from the months just before the accident. She allowed the defense to take more pictures at the September 2010 deposition.

Plaintiff's counsel argued that there was no showing from the defendant that plaintiff had posted photos which were inconsistent with what she alleged in the lawsuit, or that any of the other material in plaintiff's Facebook profile was in any way relevant to the case. The court granted plaintiff's motion in a brief one paragraph order which did not contain any reasoning, so it's tough to tell the precise basis for the court's decision.

It looks like litigants (or their lawyers) are overreaching when they seek social media evidence, and at least some courts are pushing back. (Plaintiff's lawyers are also starting to advise their clients as to the dangers of using social networking sites, at least during the pendency of ligitation. See "Social Networking Warning Letter Form for Clients.") In this case, there was little justification to force plaintiff to "friend" defense counsel and give defense counsel access to personal details that only plaintiff's Facebook friends would be privy to. There was some confusion as to whether plaintiff's profile was "public," so it's unclear as to whether defense counsel truly would be privy to information that only a select group of individuals would have access to. Regardless, given that defense counsel had access to ample photos of plaintiff's face from shortly after the incident, and was provided photos later, and could evaluate plaintiff's injuries contemporaneously, defendant didn't have a credible argument for rooting around in plaintiff's Facebook profile. As a Facebook friend, defense counsel would be exposed to information, including personal details about the plaintiff's life, that would not be relevant to the case.

I blogged about McMillen v. Hummingbird Speedway and had some qualms with the court's approach of forcing a litigant to turn over their Facebook password. Among other things, there is no way that all of the information in a profile could be relevant:

for starters, the court totally glosses over the relevance analysis. There is no way that all of the information in the plaintiff's social networking site can be relevant to the dispute, and the court's decision grants defendant access to both relevant and irrelevant information.

It looks like the court took the correct approach here.

In another decision addressing a similar issue, the court ordered the litigants to both friend the judge so the court could review the materials and address the question of relevance. ("Judge Offers to Facebook 'Friend' Witnesses in Order to Resolve Discovery Dispute.") That was a wacky approach to say the least, but it looked like the court did not even need to consider it in this case, given the lack of relevance of the materials which defense counsel was seeking.

Social networking evidence is generally viewed as an evidentiary treasure trove for lawyers, but as is becoming increasingly clear, it's easier said than done to get access to it. Statutes such as the Stored Communications Act restrict the networks' ability to disclose private communications, which may or may not include wall posts, in response a civil subpoena. An alternative is to get the information directly from the party in question, but if the party seeking the information doesn't know exactly what is in the profile, they will have a tough time articulating relevance.

As a final note, I wonder if there are any ethical issues lurking in the background for a lawyer who "friends" a party in order to gain access to evidence (even when there is no deception involved in the friending process).

Other coverage:
Legal Intelligencer: "Facebook Postings Barred From Discovery in Accident Case"
The Employer Handbook: "Court bars Facebook "friending" in discovery"

Previous posts:
"Court Orders Disclosure of Facebook and MySpace Passwords in Personal Injury Case -- McMillen v. Hummingbird Speedway"
"Judge Offers to Facebook 'Friend' Witnesses in Order to Resolve Discovery Dispute -- Barnes v. CUS Nashville"
"Facebook Messages/Wall Posts, Civil Discovery, and the Stored Communications Act -- Crispin v. Audigier"

Posted by Venkat at 08:30 AM | Evidence/Discovery , Publicity/Privacy Rights

March 28, 2011

Website Privacy Policy Supports Pseudonymous Poster's Expectation of Privacy -- Cornelius v. Deluca

[Post by Venkat Balasubramani]

Cornelius v. Deluca, 10-Cv-027-BLW (D.Id.; Mar. 15, 2011)

A district court judge in Idaho denied a request to unmask the identity of a pseudonymous forum poster. In support of its decision, the court looked to the website's privacy policy to find an expectation of privacy.

The case revolved around comments made on bodybuilding.com which Cornelius and his company are not happy about. The lawsuit has spanned two jurisdictions (Idaho and Missouri) and spawned two rulings mentioned on this blog. Professor Goldman's initial post describes the situation as follows:

DeLuca runs bodybuilding.com, a fitness website and online retailer. The plaintiffs sell dietary supplements ("syntrax," whatever that is). The plaintiffs allege that their competitors posted shill reviews to bodybuilding.com designed to harm the plaintiffs' business. The plaintiffs sued both bodybuilding.com and the putative shillers.

The first time around, the Missouri judge awarded bodybuilding.com an easy Section 230 win to the extent plaintiff tried to hold it liable for posts made by third parties. ("Online Retailer Isn't Liable for User Comments.") In a second ruling (after the dispute moved to Idaho), the court strayed from the Section 230 path and said that bodybuilding.com could be held liable for posts made by "moderators." ("Troubling Ruling About 47 USC 230 and Moderators.") In response to this ruling, plaintiff tried to find out the identity of a pseudonymous poster named "INGENIUM," who posted the following:

despite S103's constant matrix pimping in CASEIN threads, matrix is not a micellar casein product.

[I'm not even sure what the products in question are, and what claims are being made about them, but the extensive litigation activity in this case makes me think that they must be useful in some way.]

After a November 2010 hearing, the court allowed plaintiff to discover INGENIUM's identity, based in part on defense counsel's purported concession that bodybuilding.com did not object to disclosure of INGENIUM's identity. The court's earlier decision was also based on the court's conclusion - relying on a recent Ninth Circuit case (In re Anonymous Online Speakers) - that the statement in question was commercial speech. Bodybuilding.com complained, saying that counsel was not authorized to make this concession, and requested that the court reconsider its prior ruling. Also, in between the court's earlier ruling and its reconsideration of the order, the Ninth Circuit withdrew its opinion in In re Anonymous Online Speakers and left the opinion intact, except for the language that characterized the speech as commercial speech versus core political speech.

Anonymity v. Disclosure of INGENIUM's identity: The court decides that INGENIUM's speech is neither purely commercial nor core political speech, and it then looks to the question of whether plaintiffs' need for INGENIUM's identity outweigh INGENIUM's right to speak anonymously. Without deciding the appropriate test in this context, the court looks to previous cases and settles on five relevant factors (citing Sony Music v. Does, Dendrite, 2TheMart): the plaintiff's ability to establish a prima facie case; the specificity of the discovery request; the availability of alternate means to obtain the information; the need for discovery to advance plaintiff's claim; and defendant's (or the speaker's) expectation of privacy.

The court reverses itself and finds that plaintiffs could advance their claim without obtaining INGENIUM's identity - i.e., this information was not central to plaintiffs' claims. Noting that an 'extra-high hurdle' exists when a non-party's information is involved, the court finds that plaintiffs failed to clear that hurdle here. In particular plaintiffs sought to identify the precise nature of the relationship between bodybuilding.com and INGENIUM, but plaintiffs hadn't conducted any discovery directed to bodybuilding.com on this issue. Bodybuilding.com submitted a declaration setting forth its relationship with INGENIUM (that INGENIUM was a community-elected volunteer), but plaintiffs did not bother deposing the individual who submitted the declaration. Thus, there was no need for plaintiffs to unmask INGENIUM to obtain this information, at least not at this stage.

The privacy policy: The court also added that:

INGENIUM has an expectation of privacy based on bodybuilding.com's terms of service and privacy policy. Bodybuilding.com's terms of service state that no poster may make any post that would infringe on another poster's right to privacy. Bodybuilding.com's privacy policy also states that protecting users' privacy is a top priority, and bodybuilding.com has taken reasonable measures to protect users' private information.

Ultimately, the court concludes that plaintiff's attempt to discover INGENIUM's identity "is a fishing expedition based on speculation that INGENIUM was or is an agent or representative of bodybuilding.com."
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There have been a couple of cases dealing with website privacy policies and their effect on whether a user should be unmasked. I blogged about Sedersten v. Taylor, where the court held that language in the policy providing that the site could freely use user information did not result in a waiver of the right to post anonymously. ("Online Commenter Did Not Waive Right to Anonymity by Agreeing to News Website's Privacy Policy.") In McVicker v. King, the court held - as the court did in this case - that language in the policy created an expectation of privacy. (Here's Tom O'Toole's post on that case: "Newspaper Website's Privacy Policy Creates Expectation of Privacy for Commenters?")

The expectation of privacy that is derived from a site or service's terms is something that courts have looked to in the Fourth Amendment context, in dealing with questions of privilege or whether an employer has the right to access employee communications, and whether disclosure of a person's social networking profile and communications is appropriate in civil litigation. But thus far, it has not made an appearance in anonymity cases. There are a couple of questions or concerns that this approach raises: (1) whether looking to terms in privacy policies would leave anonymous users at the whim of website terms (which may change from time to time based on business considerations), and (2) whether it makes sense to impute the expectation of privacy on users based on policies that they don't necessarily read or digest? (See Chris Soghoian's post the Twitter/Wikileaks disclosure order on the second point: "Federal judge in Twitter/Wikileaks case rules that consumers read privacy policies.") The First Amendment cases dealing with online anonymity do not discuss whether the poster had a "reasonable expectation" of privacy, and looking to the online terms and privacy policy will just muddy the analysis. While it bolsters the poster's privacy in this case, it may leave online posters in general worse off. Also, in many instances it will not be determinative because sites tend to include wiggle room in their policies so they can disclose user information if it's in their interest to do so.

Interestingly, the issue is in front of the court only because of its ruling that bodybuilding.com could be held liable if INGENIUM is found to be an "agent or representative of bodybuilding.com." See Professor Goldman's skepticism about this conclusion in his earlier post on the case: "Troubling Ruling About 47 USC 230 and Moderators."

Posted by Venkat at 12:55 PM | Derivative Liability , Evidence/Discovery , Privacy/Security , Publicity/Privacy Rights

March 17, 2011

Employee's Twitter and Facebook Impersonation Claims Against Employer Move Forward -- Maremont v. Fredman Design Group

[Post by Venkat Balasubramani]

Maremont v. Susan Fredman Design Group, 2011 U.S. Dist. LEXIS 26441 (N.D. Ill.; March 15, 2011)

As alleged in the complaint, Fredman is a prominent interior designer who runs the Susan Fredman Design Group (SFDG). SFDG also has an internet presence. Maremont is an interior designer that started working at SFDG in October 2005 (as SFDG's Director of Marketing, Public Relations, and e-commerce).

Maremont was active in the online community and created "a popular personal following" on Twitter and Facebook. Maremont also created a SFDG blog entitled "Designer Diaries: Tales from the Interior" ("Designer Diaries") that is hosted on SFDG's blog." Maremont's likeness was tied to her online activities:

she authored frequent Posts and Tweets to her personal Facebook and Twitter accounts, along with the material for the Defendants' "Designer Diaries" blog. Maremont's image appeared on each personal Post and Tweet, which unmistakably distinguished her likeness.

In September 2009, Maremont was injured in an accident and was in the hospital for an extended period of time. While Maremont was at the hospital, Fredman and another SFDG employee visited Maremont and asked Maremont about various work projects. Meanwhile, one of Maremont's visitors at the hospital advised that Fredman and SFDG was impersonating Maremont by:

impersonating her by authoring Posts and Tweets to her personal Facebook and Twitter followers promoting SFDG . . . each Post and Tweet displayed Maremont's name and image giving followers the appearance that [Maremont] was the author.

Maremont then asked Fredman and SFDG to stop this practice. Apparently, the practice continued, but in December 2009, Maremont's husband read some of the posts which Fredmand and SFDG authored and published via Maremont's account and this caused Maremont to suffer distress. Maremont and her husband changed the passwords to her personal Facebook and Twitter accounts.

Maremont ultimately returned to work at SFDG on a part-time basis in February 2010 but found that she got a chilly reception at work. In May, Fredman expressed misgivings about Maremont's part-time schedule and that SFDG was having cash flow problems. In response to the perceived hostility towards her, Maremont quit, and brought claims against SFDG and Fredman.

Lanham Act Claim: Maremont brought a Lanham Act claim for "false endorsement". In order to bring a claim, she should show that she has commercialized her name or likeness. (See Stayart v. Yahoo, discussed by Eric here: "Seventh Circuit Tosses Beverly Stayart's False Endorsement Claims.") The court says that she has commercialized her name:

Maremont has . . . alleged that - as a professional interior designer - she became well-known in the Chicago design community allowing her to create a popular following on Facebook and Twitter. Maremont also alleges that her Tweets and Posts relate to her work in a commercial context, namely, as a professional interior designer and employee of SFDG.

The court did not discuss whether Maremont's online activity inured to the defendants' benefit since Maremont was posting and built up her following while she was an employee of SFDG. It's unclear whether defendants made this argument, but even if they did, given how egregious the facts were alleged to be, it would not be a surprise for it to have fallen on deaf ears. That said, given that Maremont was an employee and clearly posted on behalf of SFDG, SFDG had a possible argument that any copyright or trademark rights accrued to SFDG's benefit and not to Maremont. Also, given that some of Maremont's followers were following because of her official employment status, and assume that some of the posts related to her job. Shouldn't SFDG have an argument here that it should be able to keep up with its audience via the accounts in question?

Right of Publicity: The right of publicity claim requires Maremont to show that her identity was used for "commercial purposes . . . without [her] . . . written consent." Defendants did not argue that Maremont failed to satisfy this claim. Instead, defendants argued that the claim was barred by the statute of limitations since it first accrued in September 2009, "the approximate date of defendants' first Tweet impersonating Maremont." The court rejects this argument, citing to the "continuing violation rule." Defendants allegedly continued to exploit Maremont's publicity rights, despite Maremont's instructions to the contrary. No luck for defendants here.

Privacy Claim: Maremont also brought a common law privacy claim based on misappropriation of her likeness. Defendants argued that the Illinois publicity statute replaced the common law tort of misappropriation of likeness. In response, Maremont argued that she could also state claims for intrusion into seclusion and false light. With respect to her false light claim the court says she failed to allege actual malice. With respect to her claim that defendants "intruded into her personal 'digital life'" the court finds that she failed to develop this argument fully. The court dismisses these claims without prejudice and gives her a chance to replead.
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I'm not sure what SFDG was thinking, but its head was not on straight when it accessed and continued to post from its hospitalized employee's Twitter and Facebook accounts. This pretty much fails every common sense test there is out there. But employers seem to want to access employee accounts (see, e.g., "Pure Power Boot Camp v. Warrior Fitness Boot Camp - Ex-Employees Awarded $4,000 for Email Snooping by Employer"). Maybe employers think that they own the accounts since they are employee accounts, but this is not the case. For some reason, employers seem slow to realize this.

In accessing the accounts, SFDG potentially incurred liability under the Stored Communications Act as well. Illinois does not seem to have an online impersonation statute, but if Maremont was in California, she could have thrown in this argument as well.

The case highlights the importance of having a social media policy, which should at a minimum designate "official" employer accounts and specify when an employee's Twitter/Facebook posts are their own vs. the employers. The case also brings up the question of who owns a company's Facebook fans and Twitter followers. Given the value companies are placing on their Facebook and Twitter presences, litigation over this issue is likely to increase. Professor Goldman recently posted about a case where two companies were fighting over their Facebook fan page: "Business Sues Facebook to Restore Its Fan Page--Complexions v. Complexions Day Spa." We can expect to see more of this litigation activity in the future.

Posted by Venkat at 10:11 AM | Marketing , Publicity/Privacy Rights

March 10, 2011

Google Not Liable for Suggested Vanity Searches--Stayart v. Google

By Eric Goldman

Stayart v. Google, Inc., 2011 WL 855316 (E.D. Wis. March 8, 2011)

Beverly Stayart (a/k/a Bev Stayart) has graced these pages so many times, I feel a little silly recapping her story yet again. The short story behind this case: In the course of doing vanity searches, Bev Stayart discovered that Google suggested her name plus the name of a sexual dysfunction drug ("bev stayart levitra"). Rather than ignoring these search results, as almost all of us would do, she boldly clicked on the results and decided they were worth a lawsuit because these searches degrade her sterling reputation and generate profits for Google.

She brought a similar lawsuit against Yahoo and lost. Now, she racks up a loss against Google. Her litigation quest has unquestionably helped define her reputation in the Internet law community, but perhaps not in the way she might desire.

This opinion is relatively brief and breezy, befitting a case so devoid of merit. The court references 47 USC 230 (which should have worked, as it did in her suit against Yahoo) but sidesteps it, instead granting a 12(b)(6) motion to dismiss on the elements themselves. The court rejects Stayart's publicity rights claim because she didn't show her name has any commercial value or that Google made any use of it (commercial or not). Instead, "Google enables internet users to access publically available materials connected to plaintiff’s name." The court also says Google isn't impermissibly selling the phrase "bev stayart levitra" because clearly any resulting ads are broad-matched to "levitra."

The Seventh Circuit already has had one chance to mock Stayart (in the Yahoo lawsuit). I wonder if she will give them a second mocking opportunity.

UPDATE: On the same day, the court also dismissed Stayart's latest foray against Yahoo on less substantive grounds.

Prior blog posts on Beverly Stayart's litigation:

* Seventh Circuit Tosses Beverly Stayart's False Endorsement Claims--Stayart v. Yahoo
* Beverly Stayart Strikes Again! This Time, Stayart Sues Google
* Yahoo's Search Results Snippets Aren't False Endorsement--Stayart v. Yahoo
* Yahoo/Overture Sued for Search Results Snippets Containing Plaintiff's Name--Stayart v. Yahoo

Posted by Eric at 10:02 AM | Publicity/Privacy Rights , Search Engines | TrackBack

February 12, 2011

Debt Collection Text May Result in Liability under the Telephone Consumer Protection Act -- Gutierrez v. Barclays Group

[Post by Venkat Balasubramani]

Gutierrez v. Barclays Group, Case No. 10cv1012 DMS (BGS) (S.D. Cal.; Feb. 9, 2011)

The Telephone Consumer Protection Act is a big stick. And it's being wielded against debt collectors.

Plaintiffs (a husband and wife) applied for a credit card. On the application, the husband listed his work number and his wife's cell phone number. Credit cards were issued to both the husband and the wife. At some point, when the couple were delinquent on their payments, Barclays began making collection calls to both numbers. It also sent text messages to the numbers. In response to one of the text messages, the husband asked (via text message) to cease further text messages. Although the court doesn't explicitly say this, presumably, the messages from Barclays continued. Plaintiffs filed claims under the TCPA.

Defendants argued that plaintiffs consented to the text message by listing their number on the credit application, and sought to dismiss the claims against the wife on the grounds that she was not the "called party." The court denies defendants' request for summary judgment.

Consent: The first question was whether the wife consented to listing her telephone number and provided the "prior express consent" that would allow defendants to argue that the communications fell under this exception to the TCPA. Defendants pointed to an FCC Report and Order which stated that calls made by a creditor to a debtor to the number which the debtor provided in the credit application fall under the "prior express consent" exception. However, the wife argued that since she did not fill out the application in question, she could not have consented. The court found that there was little case law on the issue of how this type of consent must be expressed. The court looked to the criminal context and found that courts find consent to a search by the defendant, but also by a third party who possessed "common authority over or other sufficient relationship to the premises or effects" in question. Defendants put forth evidence that the husband possessed "common authority" over the phone because he freely used it. On this basis, the court finds that the wife effectively gave prior express consent to receiving the calls.

Revocation of consent: Unfortunately for defendants, that was not the end of the story. Plaintiffs argued that they revoked the consent via text message. Defendants argued that the revocation had to be in writing, but the court disagrees, noting that if consent could be provided by telephone or other means, it would be odd to require a revocation to be in writing. Ouch!

Whether the wife was the proper plaintiff: Defendants finally tried to get the wife's claims dismissed on the basis that since she did not receive the texts in question, she was not the "called party" for purposes of the TCPA. The court looked to mixed rulings on the issue of who could sue for a TCPA violation. One case held that unintended and incidental recipients could not sue. At least one case held to the contrary that any recipient could sue. The court takes a different approach and rules that only the subscriber has a cause of action to sue under the TCPA.

The TCPA is a tough statute for people who send unsolicited text messages. Third party consent is unreliable in the marketing context (see "Ninth Circuit Revives TCPA Claim--Satterfield v. Simon & Schuster"), but it looks unreliable in general. When you add the fact that consent can be revoked by text message or orally, people who send unsolicited text messages are not left with much comfort. I think that's worth remembering is that unlike spam, it does not matter whether an unsolicited text message as sent for advertising purposes. It is also no defense that the recipient was not "separately charged" for the call. Debt collection text messages can violate the statute, absent consent (which can be easily revoked).

Unsolicited text message litigation has followed almost the opposite trajectory to spam litigation. Defendants just can't seem to get a break. Some of this is a result of the overzealous plaintiffs involved in spam litigation. Some of it is also the structure of the respective statutes. The TCPA is just much more of a plaintiff friendly animal.

Posted by Venkat at 11:16 AM | Publicity/Privacy Rights , Spam

December 24, 2010

Deep Packet Inspection (NebuAd) Litigation: Court Dismisses ECPA Claim but CFAA Claim Continues

[Post by Venkat with comments by Eric]

Mortensen v. Bresnan Comm., CV 10-13-BLG-RFC (D. Mont. Dec. 13, 2010)

A district court in Montana hearing one of the many NebuAd "deep packet inspection" lawsuits partially granted a defendant's motion to dismiss. This lawsuit arises out of NebuAd's alleged attempt to monitor and use an end user's internet activity for advertisement targeting purposes - i.e., not using cookies or other tracking, but actually routing the communications themselves through NebuAd's "appliance." There have been a slew of lawsuits out of this practice; this lawsuit involved claims against Bresnan Communications, an Internet access provider, who is accused of letting NebuAd install the appliance for its profit.

Electronic Communication Privacy Act Claims: Bresnan first argued that it did not engage in any interception itself, so it could not be held liable under the ECPA. The court rejects this argument on the basis of plaintiff's allegation that Bresnan "allowed" NebuAd to install its device on Bresnan's network, and but for the appliance, the monitoring would not have occurred.

However, the court accepts Bresnan's argument that the plaintiffs agreed to the interception based on disclosures in the terms of service and elsewhere. The court quotes from Bresnan's "Online Privacy Notice," which says:

the equipment used to provide the service collects information . . . [including] information about . . . 'electronic browsing,' and the text of email or other electronic communications the [users] send or receive using [the] services.

The notice also references that the information that is collected will be disclosed to third parties. Bresnan's "Online Subscriber Agreement" contained similar disclosures. Finally, the court notes that Bresnan alleges that it provided customers "specific notice" and a link to opt-out from information collections.

Shockingly, plaintiffs did not contest that "they agreed, by way of Bresnan's Privacy Notice and Subscriber Agreement to the interception." (??) Instead, plaintiffs quibble with the scope of the documents in question and argued that Bresnan construes plaintiffs' consent "cavalierly." The court rejects plaintiffs' argument, and grants Bresnan's motion to dismiss the ECPA claim on the basis of consent.

Invasion of Privacy Claims: Plaintiffs brought a common law invasion of privacy claim. The court finds that the notice and disclosure (discussed above) undermines any expectation of privacy plaintiffs had in their use of the service. This ends the court's discussion.

Computer Fraud and Abuse Act Claims: Although the court rejects plaintiffs ECPA claim, the court allows plaintiffs' Computer Fraud and Abuse Claim to go forward. The court concludes (based on Bresnan's disclosures to its customers) that Bresnan's access of plaintiffs' computers had some authorization. Nevertheless, the court finds that Bresnan may have exceeded the authorization that was initially granted. The court bases this conclusion on the fact that the notices provided by Bresnan did not clearly apprise plaintiffs that "their computer settings were to be actively altered or tampered with by Bresnan." The court concludes that for purposes of surviving a motion to dismiss, plaintiffs have sufficiently alleged that:

Bresnan's act of tampering with the security and privacy protocols exceeded any authorization that Plaintiffs may have given.

The court also addresses the jurisdictional damage requirement, under which a CFAA plaintiff must show that the unauthorized access caused $5,000+ in damages. The court notes that plaintiffs' allegations of emotional distress are not compensable, since only economic losses are recoverable under the CFAA. However, the court finds that plaintiffs satisfy the jurisdictional damage threshold since they allege they were "forced to mitigate Bresnan's invasive actions by expending time, money and resources to investigate and repair their personal computer's diminished performance."

Trespass to Chattels: Finally, the court allows plaintiffs' trespass to chattel claims to go forward. With respect to the trespass claim, the court says that the plaintiffs sufficiently alleged an interference with their chattel (their computers).
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Venkat's Comments:

This is one of many privacy lawsuits that are percolating through the courts right now. I think this one differs qualitatively from many of the others in that here, there is an allegation of improper monitoring of the contents of the plaintiffs' communications. It's one thing to surreptitiously find out what websites someone has been visiting or leak someone's unique user ID. It's another thing entirely to read their email and the contents of what they access while browsing. This is an important distinction to keep in mind. I don't think you can necessarily extrapolate a tentative result in the other cases based on this result. Apart from the damages issue (discussed below) a key unknown in the pending cases is to what extent the information that is captured or disclosed are covered by the statutes in question.

I was somewhat surprised to see little or no discussion from the court on whether the policies were presented in a "leak proof" manner, or whether the disclosure satisfied FTC standards. Was there evidence that plaintiffs could not access the service without encountering the policy? (See Prof. Goldman's post on that topic: "Clickthrough Agreement With Acknowledgement Checkbox Enforced.")

The court's conclusion on the consent issue is also somewhat perplexing, in light of the exact same judge's earlier order denying Bresnan's request to compel arbitration, which you can access here. BNA recaps the decision denying Bresnan's request to subject the claims to arbitration as follows: "A mandatory arbitration clause in an internet service provider's terms of service—which was presented in capitalized text in the ninth paragraph of the unsigned document—was an inconspicuous part of a contract of adhesion and unenforceable under Montana law."

On the other hand, if plaintiffs conceded the consent/disclosure issue, then the court did not need to get into it. [What were the plaintiffs thinking, conceding this? If you are bringing this type of a lawsuit, you have to be able to put together enough allegations of no-consent to get past the motion to dismiss stage.]

At the end of the day, if consent is going to be the basis to defend against these types of privacy claims, defendants would be well advised to really be thorough in procuring this consent. In fact, I'm surprised that Bresnan - given that it is an IAP allegedly engaging in gray area practices - didn't just secure written consent at the time it first provided the service.

I'm also surprised at the court's conclusion on the Computer Fraud and Abuse Act damage issue, given its conclusion on the ECPA issue. If it was going to split hairs on the notice and consent (as it did with respect to the CFAA claims), it could have probably done so on the ECPA claims as well. Courts often keep in claims they may otherwise dismiss if they decided that some claims are going to survive. Also, some cases construe the CFAA narrowly as requiring damage to the protected computer (or an interruption in data). It's conceivable that plaintiffs could have suffered the requisite loss (which can be aggregated in the class action context), but the court's discussion of plaintiffs' allegations made the damage allegations seem awfully light. (Two posts from Nick Akerman look at some recent CFAA dismissals and discuss the restrictive approach taken by some courts with respect to the CFAA's jurisdictional damage requirement: "Dismissal of CFAA Claim for Lack of Jurisdiction" and "Why Two District Courts Dismissed Valid Computer Fraud and Abuse Claims for Lack of Jurisdiction.")

The dismissal of the ECPA claim as opposed to the CFAA claim could have some ramifications on the damages front. Statutory damages are available under the ECPA, but not under the CFAA. For what it's worth, there's conflicting authority on the issue of whether non-economic damages are recoverable under the CFAA. (See Garland-Sash v. Lewis, 348 Fed. Appx. 639 (2d Cir. 2009) (construing the phrase "compensatory damages" - which was added to a provision of the CFAA after the DoubleClick case came down - to include damages for pain, suffering, and other emotional harms").) Even if for some reason the court decides that plaintiffs are entitled to non-economic damages, it will be interesting to see how plaintiffs prove up these damages.

The trespass claim is a bonus claim, but again, the court doesn't dig in to the damage issue with respect to common law trespass. Although the court cites to California law, the court does not discuss damage or slowdown to the machine in question as articulated by the California Supreme Court in Intel v. Hamidi (an email bombardment case) or as interpreted by the Fourth Circuit in the Omega v. Mummagraphics case.

I'm not sure how much light this ruling will shed on the many pending privacy lawsuits that involve things like surreptitious tracking, sniffing, and leakage of personal information. Damages issues aside, the ruling may highlight the importance of choice, consent, and the requirement that any disclosures or disclaimers be conspicuous, all issues the FTC seems to frequently opine on and issue reports about.

(h/t Wendy Davis)
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Eric's Comments:

As Venkat notes, this ruling is an inconsistent mix of formalism and realism. In light of the judge's ruling last month that Bresnan made inadequate disclosures to uphold an arbitration clause, it's odd for the judge to now find that Bresnan made adequate disclosures to wipe away the ECPA and privacy invasion claims via dense/buried EULA language plus an opt-out notice; while that same consent wasn't good enough to wipe away the CFAA and Trespass to Chattels claim. The CFAA ruling on damages was also oddly formalist given the consent ruling. I respect formalist judges for being careful and methodical, but it would have been nice if this judge had been a little more aggressive about calling a spade a spade.

I am not a fan of deep packet inspection (DPI) by IAPs done on anything but an opt-in basis. We're basically back to the old battles about unwanted adware/spyware getting onto users' hard drives as part of some bundle. Sure, the adware vendors could claim user consent through a formalist reading of the contracts, but there wasn't true consumer consent, and we all knew it. I'm reminded a little of the FTC's bust of Sears for its trackware installations--Sears paid people for the installation, but the software did things far beyond anything users might have expected, even though these attributes were putatively explained deep in the EULA. If you're an IAP trying to implement DPI on an opt-out basis, bonne chance, and don't expect a lot of friends to rally around your cause.

At the same time, I'll be interested to see if the plaintiffs can marshal any true evidence of harm. If the plaintiffs are advancing a recycled version of the old, tired and completely laughable arguments that installing cookies on a user's computer creates cognizable harm, I hope this judge will quickly give them the boot they deserve. In that respect, I'm disappointed the judge didn't more aggressively police the trespass to chattels claim on the harm requirement per Hamidi. Personally, I think these plaintiffs should have been forced to put-up-or-shut-up on the harm issue early. Then again, this case came out the day before the Ninth Circuit's recent Starbucks case, but perhaps it's consistent with it.

Overall, this ruling is just another small data point in a much larger struggle over targetable consumer data. My Coasean Analysis of Marketing article doesn't directly address DPI by IAPs, but the article tells the story of how different intermediaries are fighting with each other to capture better datasets of targetable consumer behavior. After the flameout of the early 2000s model of adware, IAPs are trying to squeeze into the middle by using their more favorable position (compared to websites) to see more complete consumer data. Similarly, Facebook is trying to use tools like Beacon nee Instant Personalization to sweep up targetable consumer data from throughout the web, not just the smaller dataset it can capture at facebook.com. Meanwhile, Google is trying to move onto the desktop (the toolbar, Desktop, Chrome and its various OSes) to let it get closer to the honeypot of consumer data residing there, rather than just rely on the data it can get at google.com properties. Adware circa 2005 may be dead, but battles between different intermediaries fighting to get the good stuff is a perennial. For more, see my posts Adware is Dead and Relevancy Trumps Creepiness.

Posted by Venkat at 09:00 AM | Derivative Liability , Licensing/Contracts , Privacy/Security , Publicity/Privacy Rights , Spam , Trespass to Chattels

October 06, 2010

Tip for Clean Living: Don't Use a 14 Year Old's Self-Portrait in Advertising for Porn--Lara Jade Coton v. TVX

By Eric Goldman

Coton v. Televised Visual X-ography, Inc., 2010 WL 3768039 (M.D. Fla. Sept. 16, 2010). The initial complaint. Lara Jade's blog post on the court victory. Comprehensive recap from Plagiarism Today, who has been tracking the case all along.

Lara Jade Coton is a precocious photography talent. When she was 14, she took a self-portrait photo dressed up in a top hat and black strapless dress. The photo has no nudity and really isn't all that salacious. Coton posted the photo to a website called deviantArt, which describes itself as "the largest online social network for artists and art enthusiasts." Her account page.

The case involves a pornographic film "Body Magic," redistributed by TVX/Burge. The IMDB page. A contractor, Cohen, copied the photo from deviantArt (or some third party site that had picked up the photo) to use in Body Magic's marketing collateral, including on the DVD package's cover and as the image on the disc itself.

Obviously, this was a poorly considered decision. First, this decision appears to reflect the misapprehension that any photos on the Internet are free to reuse. Second, the decision appears to ignore the overlaps between copyright and publicity rights. We've seen this issue arise from time to time with Flickr photos and Creative Commons licenses; even if a Flickr photo can be freely republished due to a permissive CC license, the photo can't be used for advertising purposes if a person is identifiably depicted in the photo without obtaining that person's publicity consent. As part of our forthcoming casebook on Advertising and Marketing Law, I took a deeper look at publicity rights in advertising, and the case law is horrible for defendants--courts adopt very broad views of what constitutes advertising and identifiability in the advertising even when faces aren't shown. Every principal case we've included in the draft chapter is a defendant loss. Basically, if you're going to show or reference people in advertising, you need their permission.

After Coton discovered that her photo was being used, Coton contacted Burge and entered an email exchange rife with grammar and spelling errors. In one email, Burge replied:

Not only will you not be compensated for your photo we have turned this problem over to our attorney it seems the company my graphic company got the photo from on the internet is a public domain operation. You knew this when you originally sent us your scheming letter. Nice try toots.

Bonus tip for clean living: don't use the word "toots" in any responses to cease-and-desist letters.

After promising to remove Coton's photo, Burge further replied:

I'M SURE BY THE END OF THE MONTH YOUR FACE WILL BE HIS TORY. WE HAVS TOPPED SELLING THE DVD UNTIL COVER IS REPLACED. WE HAVE FURTHER CHECKED OUT YOUR NAME AND ITS NOT LIKE IT'S A HOUSE WHOLE NAME. ACTUALLY, REMOVING YOUR IMAGE WILL HELP IMPROVE THE SELL OF THE DVD ..... SO FAR IT BOMBED.

In retrospect, it is awkward for the film distributor to blame a 14 year old for not selling more copies of a pornographic video.

Coton sued a number of parties; all of them settled except for TVX/Burge, who defaulted on liability but contested damages. At issue were damages for three successful claims: direct copyright infringement, statutory misappropriation of her image, and defamation by implication.

Copyright Infringement. Coton didn't have a timely registration to qualify for statutory damages or attorney's fees. Without those, the damages are pretty low. As a professional photographer, the court accepts her asserted licensing fee of ~$3k. With low sales and a low retail price, the distributor's profits are ~$1k, for a total copyright damages award of a little over $4k.

As we've discussed so many times before (see, e.g., this post), timely copyright registration can mean the difference between a big payday and an uneconomic case. If Coton had made the timely registration, she would have likely gotten a larger damages award than $4k, and this court probably would have awarded attorneys fees of many tens of thousands of dollars.

(Note: at the time she posted the photo to deviantArt, she was an amateur photographer in Britain, so it's not surprising she didn't make a timely copyright registration. I'm sure she registers her photos early and often now).

The court rejects her claims for contributory copyright infringement for the distributor's liability for the retailers' activity, both because the distributor didn't know it was infringing the photo and because a separate damages award for contributory infringement would be double-counting.

Florida Publicity Rights (a/k/a "misappropriation"). The court denied Coton's statutory damages request for the misappropriation, treating it as a double-recovery with the copyright license award. To me, this seems like a clear error. Typically, a photo used in advertising will require separate copyright license and publicity rights license fees. In this case, it just so happened that Coton was both the photographer and the photo subject, but that shouldn't affect the respective license fees. However, Coton requested only $770, so the court's apparent error isn't a big financial deal.

The court accepts Coton's request for $25k compensatory damages for reputational harm but rejects the request for punitive damages because TVX/Burge didn't know of the misappropriation (Cohen made the error) and remediated it quickly following notice. The court also rejects any separate damages under common law misappropriation (not preempted by Florida statutory law; see the Almeida case) as double-dipping with the statute-based damages.

Defamation by Implication. Coton argued that using her self-portrait on a porn DVD false implied her participation in or support of the porn industry. The court accepts Coton's request for $100k compensatory damages "for the humiliation and mental anguish caused by the defendants' defamatory use of her self-portrait" but denies punitive damages for the same reason it denied punitive damages for misappropriation.

Net Effect. Coton won this ruling, but I would characterize it as a small win, not a big one. She had so many factors in her favor: copyright infringement, defaults by defendants, sloppy business practices by the defendants and the overall unsavoriness of the tort (associating a 14 year old with porn). At the case outset, if I knew Coton was going to win on liability, I would have estimated a higher case value than $130k. (I presume she got cash from some of her settlements, so the total payday is likely more). Factoring in attorneys' fees and the fact she will still have to work hard to get the defendants to pay the judgment, this result isn't very lucrative for her or her attorney.

From the defendants' perspective, they probably feel a little relief being on the hook for "only" $130k. Nevertheless, it's an expensive penalty for their sloppiness. The defendants sold less than 200 disks, so they are paying nearly $700 per disk. Worse, all of this was completely avoidable through industry standard rights clearance procedures. It's especially surprising to see a mistake like this by a porn company, who should already be accustomed to processing 18 USC 2257 model releases.

This case reinforces some lessons I think we already knew:

* copyright owners who want sizable damages need a timely copyright registrations
* just because a photo is available on the Internet--even on a site that represents itself as a collection of public domain images--does not mean it's free to use as a copyright matter
* even if the proper copyright license is obtained, a separate publicity rights license/consent may be required for using the photo in advertising. Watch out for being lulled into complacency by favorable Creative Commons licenses, which only address the copyrights and not the publicity rights.
* verify the age of all models used in porn ads if they aren't the actors in the film. Even if not legally required to use overage models, nothing good can come from showing an under-age model in an advertisement for porn.
* don't use the phrase "toots" in business correspondence (or, really, ever).

Lara Jade's blog post adds two tips for photographers: "Remember to be wise about where you upload your images [and] the size you upload them."

Posted by Eric at 01:22 PM | Copyright , Licensing/Contracts , Publicity/Privacy Rights | TrackBack

October 01, 2010

Seventh Circuit Tosses Beverly Stayart's False Endorsement Claims--Stayart v. Yahoo

By Eric Goldman

Stayart v. Yahoo! Inc., 2010 WL 3785147 (7th Cir. Sept. 30, 2010).

I have previously blogged about Beverly Stayart's lawsuits against Yahoo and Google for apparently sploggy (and possibly cloaked) objectionable search results delivered when she searched on her name. Whatever sympathy I might otherwise feel for her is overridden by the lawsuits' complete lack of merit.

Yesterday, the Seventh Circuit affirmed the dismissal of her false endorsement claims against Yahoo. My prior posts on the district court opinion and her initial complaint. The court efficiently points out that she has not made a use in commerce of her name sufficient to trigger Lanham Act protection, and therefore she lacks standing for a false endorsement claim.

Stayart argued that her humanitarian/charitable work satisfies the Lanham Act commerciality requirement. This is a nonsense argument that the court easily rejects: "While Stayart’s goals may be passionate and well-intentioned, they are not commercial. And the good name that a person garners in such altruistic feats is not what § 43 of the Lanham Act protects." The Lanham Act's false endorsement provisions are not a general purpose publicity right.

The district court cited two other reasons (beyond standing) to dismiss the case, including an analytically confused 47 USC 230 defense. The Seventh Circuit opinion did not address the 230 issue at all.

While this *should* be the end of Stayart's litigation, it probably won't be. She can refile her state law claims against Yahoo in state court. She also still has a pending lawsuit against Google.

An aside: It's been a busy Cyberlaw week at the Seventh Circuit, including uBID v. GoDaddy, Chicago v. Craigslist and now this opinion.

Posted by Eric at 01:02 PM | Derivative Liability , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

July 07, 2010

Scribd Can't Shake Copyright and Publicity Rights Lawsuit on Motion to Dismiss--Williams v. Scribd

By Eric Goldman

Williams v. Scribd, 3:09-cv-01836-LAB -BGS (S.D. Cal. June 23, 2010).

Larry Williams has written several books on commodities trading (their titles suggest they fit into the "Make Money Fast" genre). He alleges that rogue Scribd users, including the alias “GalaxiaMia Guy” [is it this user?], have repeatedly posted his books to Scribd. Williams sued Scribd for direct, contributory and vicarious copyright infringement and publicity rights misappropriation. The first amended complaint.

Scribd moved to dismiss but ran into a judge who appears to be a stickler about letting unmeritorious cases survive to summary judgment rather than crunching them quickly on 12(b)(6). The judge does nix the direct copyright infringement claim against Scribd. The judge notes Williams' only argument in support of direct infringement is that GalaxiaMia Guy is “friends” on Scribd with Scribd's CEO Trip Adler. Williams seems to think they are in cahoots with each other, but the judge rejects this ill-formed suspicion.

Along the way, the judge snarkily laments: "it’s no secret that the ‘friend’ label means less in cyberspace than it does in the neighborhood, or in the workplace, or on the schoolyard, or anywhere else that humans interact as real people." Ouch! I'm guessing the judge isn't a power Facebook user.

Then again, I don't understand the "friend" vernacular on Scribd. Scribd allows people to "subscribe" to each other's feeds--like a “follow” on Twitter, it isn't mandatorily reciprocal like a Facebook “friend.” Trip Adler has over a half-million subscribers on Scribd, so if GalaxiaMia Guy was one of those half-million, that doesn't mean anything. No matter what, the judge repeatedly says the "friends" argument is altogether irrelevant.

[This may be a good time to mention that I have been regularly using Scribd to post source materials. I often don't blog about what I post; in some cases, I don't even announce the posting to Twitter. So if you want to see everything I'm posting to Scribd, you can subscribe at Scribd.]

The court rejects Scribd’s motion to dismiss the contributory and vicarious infringement claims as well as Scribd’s 512 defense, all on the same basis that a 12(b)(6) is too early to make a decisive call. For example, regarding the 512 safe harbor, the court says that's properly awarded on a 12(b)(6) only "where the answer to the question is nearly obvious," which apparently isn't the case here. The court also breezes through a 47 USC 230 defense to the publicity rights claim, rejecting the immunity on a motion to dismiss "[b]ecause there are open questions in this case about the extent to which Scribd participated in the alleged infringement." Of course, many cases have granted 230 immunity on a motion to dismiss, but I'm guessing none of those were in front of Judge Burns.

Although Williams' complaint lives to see another day, it’s also clear that Williams will ultimately lose. The judge disparages the complaint (the complaint "isn’t a model of lucidity"), criticizes plaintiff's counsel for various factual omissions in the complaint (which "risks denting his credibility"), calls the remaining copyright claims "thin" and invites Scribd to seek summary judgment ("Scribd seems to have all of its arguments for summary judgment already teed up"). The judge continues:

Based on the evidence and the pleadings, the Court is inclined to say that it appears Scribd has the better arguments in this case; Scribd’s motion to dismiss is largely denied only because it is too early to raise those arguments. Williams should give serious consideration to whether he sincerely believes Scribd does not qualify for the safe harbor protections of the DMCA, as well as whether Scribd did not act as expeditiously as possible to remove Williams’s copyrighted works from its website as soon as it was asked to do so.

With a warning to the plaintiff like that, this case is an excellent candidate for a fee award to Scribd under 17 USC 505 when Scribd wins. I'll be interested to see if the judge remains irascible when it comes time to penalize Williams for wasting everyone's time.

Ben Sheffner has also blogged the case.

BONUS Blog Coverage! (kind of like a hidden track on a record album)

This is also an opportune time to note a recent ruling in Perfect 10 v. RapidShare, another opinion involving secondary copyright infringement also from the S.D. Cal. (in front of Judge Huff instead of Judge Burns). Like Scribd, RapidShare is a UGC web host that's agnostic about the types of content users publish; like Williams, Perfect 10 is a wild-eyed plaintiff.

However, unlike Scribd, RapidShare isn't eligible for the 512 safe harbors because it has not made the requisite Copyright Office filing. RapidShare is also unusual because it lacks any internal search functionality or navigation structure. Instead, each user self-publicizes the file's URL.

Procedurally, Perfect 10 faced a higher burden of proof than Williams because Perfect 10 requested a preliminary injunction, which requires the court to consider Perfect 10's likelihood of success.

Perfect 10's direct copyright infringement claim, based on a 106(3) distribution, isn't likely to succeed because RapidShare never indexes the file itself. The court also rejects an inducement claim.

Regarding contributory infringement, without 512 eligibility, Perfect 10 does not need to send 512(c)(3) notices. Instead, per Perfect 10's typical modus operandi, Perfect 10 simply sent a disk containing its copyrighted photos and basically told RapidShare to block those photos. The court says the disk delivery gave RapidShare actual knowledge of infringement. Wow. I miss 512(c)(3) after all!

Nevertheless, RapidShare does not make a material contribution because "RapidShare does not provide an integrated service that allows users to locate and download infringing files." Further, even though Perfect 10 didn't identify infringing URLs, RapidShare's other remediation efforts led the court to conclude that "RapidShare is using information provided by Plaintiff to locate and remove infringing materials, and is also taking independent steps to identify, locate, and remove infringing files." Therefore, "RapidShare is [not] failing to take simple measures to prevent further damage to Plaintiff’s copyrighted works."

Following this ruling, RapidShare countersued Perfect 10 for being a "copyright troll." I'm not sure about the legal merits of RapidShare's countersuit, but I heartily applaud its sentiments!

Posted by Eric at 08:31 AM | Copyright , Derivative Liability , Publicity/Privacy Rights | TrackBack

June 20, 2010

No Wrath in this Quon--Ontario v. Quon

The Supreme Court passes on almost every issue before it in City of Ontario v. Quon.

By Ethan Ackerman (with comments from Eric below)

On Thursday, the U.S. Supreme Court released its opinion in City of Ontario v. Quon, a Fourth Amendment case over the privacy government employees, and those who communicate with them, have in their workplace communications.

I noted with some surprise in December 2009 when the Court granted certiorari, and wondered whether this was a good or bad thing for online privacy. The glass half-full or half-empty quandary remains after the court's narrow opinion. The result for officer Quon and his text message recipients is a loss, but only because the Court found the city's search sufficiently narrow to pass muster even assuming he was entitled to all the possible Fourth Amendment protections, even while the Court declined to conclude whether or not he did actually have those protections. Everyone else will have to await the further development of Fourth Amendment case law, as Justice Kennedy's opinion for the unanimous Court said that "Prudence counsels caution before the facts in the instant case are used to establish far-reaching premises that define the existence, and extent, of privacy expectations enjoyed by employees when using employer-provided communications devices."

There is more insightful commentary than this brief note at Scotusblog.
_____________

Eric's comments: after seeing the opinions, it remains baffling why the court granted cert in this case. The only obvious reason is that the Supreme Court felt like it had to fix the 9th Circuit’s mistakes, as it yet again reversed the 9th Circuit (like that wasn’t entirely predictable). Otherwise, the opinions are so limited to the facts of the case that they provide almost no value to anyone other than the litigants. That seems like a real lost opportunity for an appellate court with discretionary appeals. Even so, it's better than dealing with a Supreme Court screwup that could have easily occurred given the messy facts in this case.

I had a chance to moot the case earlier in Spring, so I read the litigants' SCOTUS briefs. By far the most compelling fact in that massive stack of paper was that Quon was a SWAT team member who was texting on the job using a government-issued device. The on-the-job conduct of SWAT team officers is especially likely to be subject to investigation/discovery requests if/when something goes wrong, so it makes total sense to narrowly circumscribe the privacy afforded to SWAT team members’ text messages. I would feel differently about the privacy rights of other government employees whose minute-by-minute choices don’t have the same instantaneous life-and-death consequences. I don't see how this case's outcome has any implications for private-sector employees or employers.

Posted by Ethan Ackerman at 07:21 PM | Publicity/Privacy Rights | TrackBack

June 19, 2010

MySpace Photo and Internet Gang Roster Evidence Improperly Admitted -- People v. Beckley

[Post by Venkat]

People v. Beckley, Case No. B212529 (Cal. Ct. App. June 9, 2010)

Two defendants were convicted of a gang-related homicide in this case.

MySpace Photos: The girlfriend of one of the defendants offered an alibi that one of the defendants was babysitting her child at the time of the shooting. She also testified that the defendant ceased gang involvement (at her request) after the two became involved. In order to rebut the gang affiliation testimony, the prosecution offered a photograph of the girlfriend flashing a gang sign - the photograph was downloaded from the MySpace page of one of the defendants. The prosecution relied on the testimony of the detective who downloaded the photograph.

The court of appeals held that admission of the photograph was error (unfortunately for the defendants, the court held that this error was harmless). The court noted that there are two methods for authenticating a photograph: (1) testimony of a person who was present when the photograph was taken and (2) expert testimony that the photograph is not "a composite and had not been faked," along with foundational testimony. Here, neither method of authentication was used. The court urged particular caution when it came to digital photos and photos found on the internet:

Although defendants conceded that the face in the MySpace photograph was Fulmore's, neither method of authentication recognized in Bowley qualified the photo for admission as accurately depicting that Fulmore had assumed the pose shown in the photograph. [The detective] could not testify from his personal knowledge that the photograph truthfully portrayed Fulmore flashing the gang sign and . . . no expert testified that the picture was not a "'composite' or 'faked'" photograph. Such expert testimony is even more critical today to prevent the admission of manipulated images than it was when Doggett and Bowley were decided. Recent experience shows that digital photographs can be changed to produce false images. (See e.g. U. S. v. Newsome (3d Cir. 2006) 439 F.3d 181, 183 [digital photographs used to make fake identification cards].)
. . . .
Indeed, with the advent of computer software programs such as Adobe Photoshop "it does not always take skill, experience, or even cognizance to alter a digital photo." (Parry, Digital Manipulation and Photographic Evidence: Defrauding The Courts One Thousand Words At A Time (2009) 2009 J. L. Tech. & Pol'y 175, 183.) Even the Attorney General recognizes the untrustworthiness of images downloaded from the internet, quoting the court's warning in St. Clair v. Johnny's Oyster & Shrimp, Inc. (S.D. Tex 1999) 76 F. Supp.2d 773, 775 that "'[a]nyone can put anything on the Internet. No web-site is monitored for accuracy and nothing contained therein is under oath or even subject to independent verification absent underlying documentation. Moreover, the Court holds no illusions that hackers can adulterate the content of any web-site from any location at any time.'"

Online Gang Roster: The prosecution also sought to show that defendants belonged to a gang (the Southside Compton Crips) and as evidence offered a roster which appeared on a web page.

The court found that this evidence was also improperly admitted. The detective admitted that "he did not know who authored the roster." Although the detective claimed that "they themselves put [the list] together," he did not explain the basis for this assertion. The court noted that the issue with respect to authenticity was not "whether the computer's printer could be trusted to reliably print out what was . . . stored on some site but whether the content of what was on the site was reliable."

Unfortunately for defendants, the court held that admission of this evidence was also harmless error. This is not the first time a court has found that MySpace gang affiliation evidence was improperly admitted but that the admission was harmless.

Additional Coverage: "'Unauthenticated' Photo From Website Held Inadmissible" (Metropolitan News-Enterprise)

Posted by Venkat at 11:25 AM | Evidence/Discovery , Publicity/Privacy Rights

May 09, 2010

Updates to the Outed Judge-Commenter's Lawsuit Against the Plain Dealer -- Saffold v. Plain Dealer

[Post by Venkat]

I posted a while ago on the lawsuit brought by Judge Saffold against the Plain Dealer newspaper where she alleges the newspaper improperly outed her as a commenter in breach of its privacy policy.

A few updates:

1. Judge Saffold Removed: Judge Saffold was presiding over a serial murder case, and among other things, she was accused of making comments about case on the Plain Dealer's website. At the defendant's request, she was removed from the case.

2. Comments by "lawmiss" on Other Sites: The Plain Dealer reports (in a detailed article) that a commenter with the same username as Judge Saffold ("lawmiss") made comments on other sites, including those that allegedly "target Arabs, Asians, others."

3. A Second Username for Judge Saffold?: The Plain Dealer (again) reports that "other commenters on cleveland.com have noted a similarity between the lawmiss comments and postings under the username 'governmentwatcher.'"

4. Judge Saffold's Unpaid Parking Tickets: The Plain Dealer also reports that Judge Saffold has over $1000 in "fines and late fees for city of Cleveland traffic and parking tickets." (via Volokh Conspiracy)

5. Judge Saffold's Work Computers Removed: The Plain Dealer subpoenaed Judge Saffold's work computers which were removed from her chambers.
___

The Plain Dealer, which reported on all of these stories, seems to be engaged in a media war against the judge. To me, this just highlights the tricky situation the Plain Dealer was in in the first place, by having access to Judge Saffold's account particulars. To the extent they as a media entity have access to information, the temptation to use it will be strong, and tough to resist. Also, the Plain Dealer is providing Judge Saffold ample ammunition to argue that the Plain Dealer was being vindictive, and if it's found to be liable, this may not help the damage calculus. (They're certainly not abiding by the "less is more" rule.) On the other hand, a plaintiff who brings claims revolving around his or her reputation can expect to have everything in his or her background dredged to the surface. If Judge Saffold is found to have been the prolific online commenter that the Plain Dealer says she is, this is not going to do wonders for her reputation, which has probably already suffered some damage following the lawsuit.

Two other posts that I came across that are worth checking out: (1) "Judge Suing Newspaper for Breach of Web Privacy Agreement Over Being Outed as Author of Anonymous Comments" (this post by Professor Volokh and the comments to the post highlight the fact that there's no clear answer under the policy) and (2) "Unmasking a Judge’s Anonymity: Saffold v. Plain Dealer Publishing Co" (this post by Professor Solove discusses the various legal claims, and also points in the direction of no clear answer, at least on the privacy policy issue).

Finally, Professor Goldman was on a Berkman Center panel that briefly discussed this case, along with a host of other issues faced by those who build and maintain online communities [YouTube link]: "Building and Managing Online Communities: Anonymity, Defamation and Privacy, Oh My!" The panel is well worth checking out.

Posted by Venkat at 10:39 PM | Publicity/Privacy Rights

April 23, 2010

Beverly Stayart Strikes Again! This Time, Stayart Sues Google

By Eric Goldman

Stayart v. Google, Inc., 2:10-cv-00336-LA (E.D. Wis. complaint filed April 20, 2010)

I've previously blogged about Beverly Stayart (a/k/a Bev Stayart) and her mockable lawsuit against Yahoo. She has repeatedly declared that she is the only Beverly Stayart / Bev Stayart in the world and that her name--due to the cachet she has built up from being a quality human being--is being used to peddle sex-related pharmaceuticals. She lost her first foray against Yahoo on 47 USC 230 grounds but nevertheless is trying again.

Now, she has launched another effort to defend her name—this time she is suing Google for similar concerns. (Like we couldn't see that coming!). She objects to the fact that Google Suggest prompts searchers on "bev stayart" to search for "bev stayart levitra." (para. 13). Anticipating a 47 USC 230 defense, she argues (para. 15) that Google Suggest represents first party editorial content that drops out of 230 coverage. The complaint also seems to raise the question of whether selling a personal name as a keyword trigger constitutes a publicity rights violation; but the complaint does not appear to evidence any understanding of broad matching, i.e., that a search for "bev stayart levitra" will deliver Levitra-related broad-matched ads for reasons having nothing to do with Bev Stayart. (See this recurring defect in paras. 90-109).

(Note: this prompted me to check out a search for "eric goldman levitra." My first result, from www.hosmersoda.com, looks pretty sploggy to me, but there's no way I'm going to click on these links!!!)

Some unsolicited advice for Bev Stayart: stop suing search engines, and stop running vanity searches on the search engines. Life is too short to fret about sploggers!

Two final notes: Bev's attorney is, once again, Gregory A. Stayart, her employer and presumably a family relation. Also, searches for "Bev Stayart" and "Beverly Stayart" are worth a look—I can’t recall other search results quite like that.

Posted by Eric at 09:29 AM | Derivative Liability , Publicity/Privacy Rights , Search Engines , Spam | TrackBack

April 13, 2010

Google Sued for Publishing Home Address--Harris v. Google

By Eric Goldman

Harris v. Google, Inc., 1:10-cv-21119-AJ (complaint removed to S.D. Fla. April 8, 2010). The original complaint filed in state court. Google's removal to federal court.

Jonathon Harris sells rare coins. His business office is in Stuart, Florida, and he lives in Jupiter, Florida. As gold prices soared, Harris claimed a heightened fear of being robbed; and to the extent his home address was publicly known, he feared that criminals would seek him out there.

Searches for Harris' business in Google Phonebook pointed potential customers to his home address in Jupiter, not his business address in Stuart. Google Phonebook provides a takedown procedure that promises a "permanent" fix within 48 hours. Harris claims that he made a takedown submission and Google initially honored it; but subsequently his home address showed up again, and Google then ignored multiple takedown requests. He sued in state court for public disclosure of private facts and intentional infliction of emotional distress. Google has removed the complaint to federal court.

On its face, I am skeptical that publication of Harris' home address was sufficiently "outrageous" to satisfy the prima facie elements of either of his claim. But even if it does, Google ought to be protected by 47 USC 230. It appears that Google Phonebook is provided by a third party provider, so it should qualify as third party content to Google, and the types of claims Harris makes are squarely covered by 230. Compare, e.g., the Doe v. MySpace cases, where the victims actually experienced physical harm; here, Harris just raises the possibility of prospective harm.

While this looks like an easy 230 case, I wonder if this case implicates some of the interstices of the Barnes v. Yahoo ruling. At its core, Harris isn't complaining just about the publication of his home address; he is also complaining that Google Phonebook's promised a fix and didn't deliver. Per Barnes, any negligence-style claim for failure to remove should be preempted; but did the website disclosures provide Harris with sufficient grounds for a promissory estoppel claim? (Note he didn't make a promissory estoppel claim per se, but it is perhaps implicit in the claims he did make). Ultimately, even if he tries to push the promissory estoppel angle, Harris may have difficulty establishing sufficient reliance on the Google Phonebook disclosures.

I am a little confused why Harris' court filings didn't redact his home address. As is so common for plaintiffs bringing privacy invasion lawsuits, Harris' lawsuit may have been counterproductive at trying to keep the world from knowing his home address. In this respect, I'm reminded a little of the Boring v. Google lawsuit; like the Borings, perhaps Harris is unusually sensitive about his home privacy, and a public lawsuit is an ineffectual method of preserving that. Then again, I bet Harris' lawsuit would not have even materialized if he hadn't felt that Google was such a black box when he repeatedly complained.

Posted by Eric at 09:01 AM | Derivative Liability , Publicity/Privacy Rights | TrackBack

April 08, 2010

Unmasked Judge/Commenter Sues Newspaper for $50mm -- Saffold v. Plain Dealer

[Post by Venkat]

Saffold v. Plain Dealer Publishing Co., Cuyahoga County Court of Common Pleas (filed April 7, 2010) [scribd]

A judge/commenter who was unmasked by the Cleveland Plain Dealer is reportedly suing the newspaper for 50 million dollars. (h/t ABA Journal) There are plenty of bad facts to go around, but I see an uphill battle for the plaintiff.

Background: Cuyahoga County Common Pleas Judge Shirley Strickland Saffold (or someone with access to her email, commenting as "lawmiss") allegedly left some eighty plus comments on the website of the Cleveland Plain Dealer (at cleveland.com). Some of the comments included:

All of these criminals committing crimes against women must stop. None of them should get out of prison, EVER.

Rufus Sims (lawyer of Sowell and of a bus driver convicted of vehicular homicide) did a disservice to his client. If only he could shut his Amos and Andy style mouth ... This was not a tough case, folks. She should've hired a lawyer with the experience to truly handle her needs. Amos and Andy, shuffling around, did not do it.

I'm confused. There's three stories. The first accuses Saffold of being a bully and demeaning the presence of this reporter for no reason. The second indicates that she refused to allow the Plain Dealer reporters to view the proceedings today, and the last indicates that the defense attorneys and the prosecutors agreed that the court needed to find out who the leak was, but they disagreed about the leaking spoiling the pool. What did Saffold do that was wrong??

The Plain Dealer decided to "unilaterally . . . unmask" Judge Saffold and wrote an article about the unmasking. The Plain Dealer and Judge Saffold were not on the best of terms prior to this incident. While Judge Saffold allegedly commented on pending capital murder cases, her comment dealing with the mental health of a relative of Jim Ewinger, a Plain Dealer reporter, supposedly led to the unmasking. (Wendy Davis covered this in an article here: "Cleveland Paper Unmasks Judge As Commenter".)

The Complaint: The Complaint asserts various claims based on the privacy policy (including a promissory estoppel claim), a claim for fraud, a claim for invasion of privacy/false light, and a claim for defamation.

Privacy Policy: The privacy policy claim is tough. For starters, the privacy policy is not clear that it guarantees anonymity. Second, claims for damages based on a breach of privacy policy are not very easy to make. Many recent cases rejected privacy policy-based claims for lack of actual damages (and some jurisdictions have a rule that precludes recovery for emotional damages unless a physical injury is involved). (See, for example, Pinero v. Jackson Hewitt; Bell v. Acxiom; Pisciotta v. Old National Bancorp [pdf].) There's even a case which expressly rejects a claim based on the disclosure of an email address in violation of a privacy policy. (Cherney v Emigrant Bank) Of course, all of these cases are based on the view that disclosure in itself does not cause damage, and Judge Saffold's case presents different facts. She will probably get past the damages hurdle, but she will have to deal with any provisions in the terms of service that the paper could use to undercut her claims or at least limit damages (disclaimers of warranty, limitations of liability, etc.). Her bigger challenge is to prove that the privacy policy actually guaranteed anonymity, and as Wendy's article points out, the policy envisions that the newspaper would use personal information in a variety of scenarios, including for the newspaper's own benefit.

Invasion of Privacy: The invasion of privacy claim is similarly tough because it will probably turn on whether plaintiff reasonably expected that her comments would remain anonymous. Anyone using the internet will tell you that there's no guarantee of anonymity, and in addition to the ambiguity of any guarantee in the policy, the paper will likely argue that the policy made clear that there are a variety of circumstances in which any user's personal information would be disclosed. Disclosure in response to a subpoena is obviously the classic example. Use of personal information for business purposes is another example.

First Amendment/Media Privilege Defense: At the end of the day, plaintiff will have a challenge proving that she reasonably expected some guarantee of anonymity, and even if the court finds that there was a guarantee, the newspaper could also try to invoke some sort of First Amendment/media privilege defense. It's certainly newsworthy for a judge to have commented on pending cases. While this wasn't what prompted the newspaper's unmasking of the plaintiff, this could bolster the newsworthiness argument. The fact that the judge used the same online profile to supposedly comment on a case she was presiding over (!) is extremely problematic and will cut against the expectation of anonymity. A litigant in that case certainly has a shot at discovering the identity of the commenter in order to support a recusal motion, and once the litigant figures out the judge's identity, the cat is out of the bag. The lawyers litigating the serial murder case Judge Saffold was presiding over (and allegedly commented on) are actually making this argument. ("After Web Post About Serial Murder Case, Judge Should Step Down, Lawyer Says"; "‘Lawmiss’ Comment on Accused Serial Killer Is Linked to Judge Overseeing His Case") This makes the Judge's expectation of anonymity argument that much harder. Had the newspaper found this information out from another source, the First Amendment argument would probably be a fairly strong one. However, given that the Plain Dealer doesn't seem to have the cleanest hands, I'm not sure how much mileage this will get here.
__

There are two strong facts on the other side, in the plaintiff's favor. First, the paper seems to have been engaged in a feud with her, and the reporter may have had his own personal score to settle. This will not look good for the paper. Second, media entities can't pick and choose. It certainly is arbitrary for a paper to say "we have a privacy policy and will protect your anonymity . . . except when your identity as a commenter is newsworthy, in which case we'll exploit that to our benefit." Newspapers are in a tricky position as far as commenter anonymity, and no one will reasonably think that media can have it both ways, which is what they'll have to end up arguing. Finally, while the newspaper could have disclosed the Judge's identity in response to a subpoena, that doesn't mean the paper should voluntarily disclose it in order to publish something it thinks is newsworthy (or to settle a score).

The key question here, is how, why, and when the newspaper decided to check out the real identity of "lawmiss."

When all is said and done, plaintiff will finally have to actually prove damages, and suffer the additional embarrassment of a very public dispute around her comments on a newspaper website. Discovery sure is not going to be pretty. (Interestingly, the complaint cites to many public statements made by the Plain Dealer. The Plain Dealer should have adhered to the "less is more rule," when making statements about potential disputes.) Regardless of how the dispute plays out, I guess it illustrates that when interacting online, people need to keep common sense at the forefront. To the extent the she commented on a serial murder case she was presiding over, what was she thinking? On the other hand, what was the newspaper thinking when it decided to "check out the identity of a commenter?"

The case raises the issue of the ethical quandary inherent when a newspaper is the custodian of anonymity. To the extent the newspaper has access to the identity of commenters, there will always be the temptation to check out who particular commenters are. The newspaper in many situations ends up making the call on when to release the identity of the commenter, when to publicize it, and when to fight for anonymity. There will always be conflicting considerations and ethical issues present here.

A final note. Whether someone had the expectation of privacy when dealing with a website or social network is becoming an increasingly litigated issue. I question how useful it is to use the actual language of a privacy policy to determine the expectation of privacy. These are clunky documents that no one ever reads, much less understands. I cringe every time a court wades through a privacy policy, picking and choosing among language it thinks supports or detracts from an expectation of privacy. I blogged about a recent case where a court held that a newspaper website commenter did not waive the expectation of privacy based on language of a policy: Sedersten v. Taylor. Tom O'Toole makes a similar point in a post about another recent case, McVicker v. King: "Newspaper Website's Privacy Policy Creates Expectation of Privacy for Commenters?"

Update: I've added a few additional links below, and clarified that the comments were left with someone who shares the same email address as Judge Saffold. (Judge Saffold's daughter is taking credit for the comments, or at least some of them.) The Plain Dealer reported that someone with the same email address as Judge Saffold left the comments, and verified some of the information behind its reporting through a public records request. It reported that its public records request revealed that someone used Judge Saffold's work computer to access the paper's website at the same exact time as when someone left some of the comments.

Additional Coverage:

Courthouse News has a post which provides some good factual background: "Judge Demands $50 Million From Plain Dealer"

ABC News has a post which also contains some interesting background facts: "Judge Saffold Files $50M Suit Against Cleveland Newspaper Over Online Comments" (It looks like the Judge's daughter who is or was a law student says she was the one who made some of the comments! An Ohio law professor is also quoted as saying it would have been a "major ethics violation" for the judge to have commented on pending cases.)

Cleveland Plain Dealer: "Cuyahoga County Judge Shirley Strickland Saffold files $50 million lawsuit against The Plain Dealer and others"

Gawker: "Can Anonymous Commenters Be Outed if They Do Something Newsworthy?"

The Newsroom Law Blog had a good post about the ethics of the unmasking: "Cleveland Newspaper Unmasks Anonymous Commenter" The post makes a good point about what this may mean for future anonymity arguments asserted by the Plain Dealer on behalf of anonymous commenters. [The Plain Dealer's John Kroll comments on the post . . . fodder for discovery?]

Posted by Venkat at 08:36 AM | Privacy/Security , Publicity/Privacy Rights

February 01, 2010

Google Street View Lawsuit Revived, But Only on Trespass Grounds--Boring v. Google

By Eric Goldman

Boring v. Google Inc., 2010 WL 318281 (3rd Cir. Jan. 28, 2010).

You may recall the book project A Day in the Life of America [Amazon affiliates link], which published what 200 photojournalists saw on May 2, 1986. The book provided a great snapshot of Americana, both sensational and banal. As a dataset, Google's Street View reminds me a lot of that book. The Google camera cars automatically capture whatever they see, which in some cases can lead to unintentionally amusing results. See, for example, this list of 20 crimes captured on Google Street View and the Huffington Post's list of "Craziest Google Street View Shots OF ALL TIME."

Inevitably, some people are going to be unhappy with whatever Google's camera cars indiscriminately captured and published. The plaintiffs in this case, Aaron and Christine Boring, are Pennsylvania homeowners with a reclusive streak. The Google camera car drove down the Borings' private driveway (allegedly ignoring the Borings' signage), took pictures of their house and published the photos through Google Street View.

The Borings were not satisfied with exercising Google's opt-out mechanism and instead made a federal case out of Google's transgressions. However, the district court was not impressed and kicked the Borings out of court.

The Borings appealed to the Third Circuit, which rewarded them with a small window of opportunity. The district court had rejected the Borings' trespass claims because they had not adequately alleged damage from the trespass. The appellate court reversed this point, saying a real property owner does not need to allege damage in order to state a valid trespass claim. As the court says, "Here, the Borings have alleged that Google entered upon their property without permission. If proven, that is a trespass, pure and simple." I'm not a real property expert, but this sounds right to me. The district court cited an 1899 case in support of its ruling, but the appellate court said that precedent was inapplicable.

Thus, the trespass claim survives a 12(b)(6) motion to dismiss, and the case gets sent back to the district court. While the appellate court expressly didn't tell the judge what to do, it's pretty clear that the appellate court doubts that the Borings will be able to assert any cognizable damage. As the court says, "it may well be that, when it comes to proving damages from the alleged trespass, the Borings are left to collect one dollar and whatever sense of vindication that may bring." My guess is that's the best possible outcome for the Borings.

In my opinion, the court's rejection of the Borings' privacy claims is the more interesting cyberlaw development. The court sensibly concludes that any violation suffered by the Borings would not highly offend a reasonable person. In other words, the Borings overreacted in a way the law does not recognize.

Given that the Borings weren't depicted in the photos, the court's ruling suggests that publishing online photos of private property categorically can't qualify as a privacy violation, whether the photos are taken on public or private property. The court's ruling, however, leaves open the possibility that depicting people in the photos might still be actionable--a question not before the court.

While the case has been revived, it's entirely clear to me that the Borings will not find much success on remand. Nevertheless, to save the litigation costs, Google ought to write a small check to settle the case, and the Borings would be prudent to take it rather than wait for the inevitable judicial denouement. To avoid further unwanted intrusions, they should use their settlement money to buy a gate for their driveway.

Posted by Eric at 06:43 AM | Publicity/Privacy Rights , Search Engines | TrackBack

January 31, 2010

January 2010 Quick Links

By Eric Goldman

Copyright

* An English translation of Google's December loss in France on a Google Book Search lawsuit.

* Ed Felten reports on a survey of files available via BitTorrent. Acknowledging some methodological limits, he estimates ~99% were likely copyright infringing.

* Elsevier B.V. v. UnitedHealth Group, Inc., 2010 WL 150167 (S.D.N.Y. Jan 14, 2010). Denying copyright statutory damages and attorneys' fees to unregistered foreign works is constitutional because the Berne Convention (which Elsevier argued prohibits the statutory formalities) is not self-executing.

* Techdirt: Singapore Court Rules That Online DVR Is Infringing...While Noting How Copyright Law Isn't Really Set Up For This

* Techdirt: If Banning The Internet For Sex Offenders Is Unfair, Is Banning The Internet For Copyright Infringers Fair?

* The Copyright Office issued new regulations on the deposit of online-only works: “The regulation establishes that online–only works are exempt from mandatory deposit until a demand for deposit of copies or phonorecords of such works is issued by the Copyright Office.”

Trademark/Publicity Rights

* American Airlines v. Yahoo settled. Previous coverage:
- Yahoo Subpoenas Expedia in American Airlines Lawsuit
- Fifth Circuit Denies Yahoo's Jurisdictional Appeal in American Airlines Case
- American Airlines v. Yahoo Venue Transfer Denied
- Yahoo Countersues American Airlines for Declaratory Judgment
- American Airlines Sues Yahoo for Selling Keyword Advertising

* Duplicity alert! Rescuecom is in court defending its keyword ads triggered by competitor Best Buy's TMs.

* Bev Stayart sues Yahoo again over publicity rights. My September 2009 blog post on her prior loss against Yahoo.

Pornography

* Clark v. Commonwealth, 2009 WL 5125009 (Ky. App. Ct. Dec. 30, 2009). Upholding a conviction when "Clark knowingly used a computer for the purpose of getting a minor, or a peace officer whom Clark believed was a minor, to take a sexually explicit photograph of herself."

* Am. Booksellers Found. for Free Expression v. Cordray, Slip Opinion No. 2010-Ohio-149 (Jan. 27, 2010). Ohio's Supreme Court partially upholds its state law restricting Internet distribution of harmful to juveniles material to juveniles when the communications are to recipients known or believed to be juveniles.

Spam

* United States v. Zein (E.D. Mich. 2009). Posting an ad on Craigslist constituted a "mass marketing" activity sufficient to trigger a 2 level sentencing enhancement.

* Comcast and e360 settled their lawsuit. Previous blog coverage.

Blogs/Social Networking Sites

* Sieber v. Brownstone Publishing Company, 2007 CA 002549 B (D.C. Superior Ct. Dec. 23, 2009). A building contractor sued Angie's List and other people over consumer reviews. My prior mention of the case. After 2 years of litigation, a DC trial judge dismissed all defendants on summary judgment and awarded one defendant-counterclaimant $18k+. The entire text of the memo opinion:

MEMORANDUM OPINION AND ORDER GRANTING MOTIONS FOR SUMMARY JUDGMENT OF ALL DEFENDANTS, DENYING PLAINTIFFS' MOTIONS FOR SUMMARY JUDGMENT, and GRANTING POOLE'S MOTION FOR SUMMARY JUDGMENT ON HIS COUNTERCLAIM signed by Judge Long, efiled, eserved, and docketed in chambers on December 23, 2009. It is ORDERED that the Motions for Summary Judgment of Brownstone Publishing Co., the Washington Post Company, John Kelly, and John W. Poole are granted; and it is FURTHER ORDERED that the Motions for Summary Judgment filed on behalf of the plaintiffs are denied; and it is FURTHER ORDERED that judgment shall be entered in favor of all defendants against the plaintiffs as to all claims in the Second Amended Complaint; and it is FURTHER ORDERED that judgment shall be entered in favor of defendant Poole and against plaintiff SCS Contracting Group LP as to Poole's Counterclaim against plaintiff SCS Contracting Group for $18,300 plus 6% (six percent) per annum interest, and a separate money judgment for this sum shall be docketed. Court Jacket not in chambers.

* FINRA Regulatory Notice 10-06: Guidance on Blogs and Social Networking Web Sites.

* Duer v. Henderson, 2009-Ohio-6815 (Ohio App. Ct. Dec. 23, 2009). A web publication telling a ghost story and describing the location of purportedly paranormal phenomenon on private property is not liable for any resulting trespass to real property.

* The “moldy tweet” lawsuit was dismissed.

* Two lawsuits holding that bloggers aren't subject to jurisdiction in the plaintiff's home court:
- Silver v. Brown, 2009 WL 5220297 (D. N.M. Nov. 30, 2009).
- Workman Sec. Corp. v. Phillip Roy Financial Services, LLC, 2010 WL 155525 (D. Minn. Jan 11, 2010)

* BBC: France ponders a right-to-forget law.

E-commerce

* Appliance Zone, LLC v. NexTag Inc., No:4-09-cv-0089-SEB-WGH (S.D. Indiana Dec. 22, 2009). Upholding NextTag's clickthrough-formed advertiser agreement. Mehmet Munur’s comments.

* Edward A. Zelinsky, “New York’s 'Amazon Law': Constitutional But Unwise.”

* Largo Cargo v. Google, a new complaint over allegedly mismanaged AdWord bids. This is the latest incarnation of the Almeida case. I think Largo Cargo’s complaint is still a no go.

* The NYT catalogs an impressive roster of futility for US dot coms trying to compete in China.

Miscellaneous

* Gmail will consult the user's prior emails to pick an ad if a particular email doesn't lend itself to a good ad.

* Illustrating the divergence between the open source community and the Wikipedia community, APC reports that 75% of Linux code is now written by paid developers.

* Oddee: 15 Funny Facebook Fails.

* I expect to be in the Netherlands May 23-30. Let me know if you would like to meet up there.

Posted by Eric at 01:19 PM | Content Regulation , Copyright , Derivative Liability , E-Commerce , Licensing/Contracts , Marketing , Publicity/Privacy Rights , Search Engines , Spam , Trademark | TrackBack

January 11, 2010

Top Cyberlaw Developments of 2009 (Eric's List)

By Eric Goldman

Guest blogger John Ottaviani recently dropped by to offer his perspectives on 2009’s top Cyberlaw developments. While I like his list a lot, I independently developed my own top 10 list that has a different emphasis. You might enjoy the contrasts. My list:

#10: Louis Vuitton v. Akanoc. After the judge ordered a web host to stand trial, a jury awarded the trademark owner $32 million due to the web host’s contributions to trademark infringement by its customers. This case stands out for the big damages award and as a rare example where an online provider was held liable under a contributory trademark liability theory. Many trademark practitioners are scratching their heads trying to figure out the import of this case, however. Does this case represent a dangerous new frontier of online liability? Was this a bad jury verdict fueled by poor defense lawyering? Or was this an appropriate outcome because the web host actually engaged in bad behavior that distinguishes it from most “legitimate” web hosts? 2010 may help us understand if this case is part of a new trend or an aberration.

#9: Gordon v. Virtumundo. We’ve seen a lot of silly anti-spam litigation, including the emergence of an entirely new group of entrepreneurs called “spam litigation entrepreneurs” who try to make a living on anti-spam lawsuits. These folks have a true love-hate relationship with spam; they hate it so much that they devote their lives to fighting it, but they love getting spam because each one is a potential revenue source. In general, judges hate spam a lot too, so over the years we have seen a number of doctrinally unsupportable results where judges bent the law to make sure spammers lost.

However, the judicial pendulum has swung in the opposite direction, and in Gordon v. Virtumundo, the Ninth Circuit destroyed a serial anti-spam plaintiff’s entrepreneurial business in a doctrinally questionable but strongly worded opinion. In short order, a number of other spam litigation entrepreneurs have seen their lawsuits shut down with emphasis. Due to this ruling, the era of anti-spammers partying in courts may be on the wane.

#8: Zango v. Kaspersky. The question raised in this issue is simple to state but hard to answer: who should decide what constitutes spam, spyware or a virus? Vendors of software designed to curb these threats would like unfettered discretion to make their classifications; businesses who are classified as a threat would like judges to overturn adverse decisions. As it turns out, in a relatively obscure provision (47 USC 230(c)(2)), in 1996 Congress said that software vendors get to make classifications decisions and unhappy businesses can’t complain about them. In June, the Ninth Circuit upheld Kaspersky’s decision to classify Zango’s software as a threat and rejected Zango’s efforts to take the classification decision out of Kaspersky’s hands. This ruling gives enormous freedom to vendors of anti-spam/anti-spyware/anti-virus software to do their best to keep us safe.

#7: Columbia Pictures v. Fung. This case came out just before the Christmas holiday, so it got lost in the holiday hoopla a bit, but it’s a case of potentially significant import. First, it held that the specific torrent sites at issue induced copyright infringement. Second, the court denied the torrent sites’ eligibility for the DMCA online safe harbors. In part, the court said that an inducing website was categorically disqualified from the DMCA online safe harbors. Like the Akanoc case, it’s not entirely clear if this result was a legal aberration or an appropriate reaction to the defendants’ poor choices. Either way, it is possible that more “legitimate” websites may change their behavior to minimize their exposure based on the legal precedents in this case. If they do, this case could have a major impact on UGC websites.

#6: Lori Drew’s acquittal. Megan Maier’s suicide remains a heartbreaking tragedy, but unfortunately, overzealous prosecutors compounded the tragedy by prosecuting Lori Drew using bogus legal doctrines. The tragic facts got a jury to convict Drew of some misdemeanor crimes. Fortunately, the judge recognized the legal errors of the prosecution’s theory and the jury’s conclusions and granted Drew an acquittal despite the jury findings. The judge finally got to the right result as a matter of Cyberlaw, but the case remains a chilling testament to prosecutorial power.

#5: Harris v. Blockbuster. The rule is really clear. Service providers can't amend online user agreements in the provider’s sole discretion without notice. As the Ninth Circuit informed us in 2007, those contracts don’t fare well in court. So although these provisions are in just about every online user agreement, they don’t work--as Blockbuster found out the hard way.

As part of the litigation detritus from the Facebook Beacon experiment, users sued Blockbuster for sharing their rental transactions with Facebook and all of their friends, allegedly in violation of the Video Privacy Protection Act. Blockbuster tried to bust the class action by invoking the contract’s arbitration clause. Instead, because Blockbuster had the impermissible amendment provision in its user agreement, the court said the contract was illusory and refused to send the case to arbitration.

This case should signal the end of the ridiculous amendment clauses. We’ll see how long it takes the lawyers to give the provisions up.

#4: Battles Over the First Sale Doctrine. We have seen numerous legal battles this year over the First Sale defenses in both copyright and trademark law.

Copyright owners try to engage in price discrimination by carving up the world into geographic territories with different prices for the same product. If they can use copyright law to keep the cheap products from entering the other geographic market, this keeps the product from effectively price-competing with itself.

This year, two cases involved European textbooks which were functionally equivalent to the textbooks being sold in the United States at higher prices. Entrepreneurs were buying the cheap European texts, shipping them to the US and then selling them online. The entrepreneurs invoked the First Sale doctrine, which says that copyright law can’t prohibit the legitimate purchaser of a tangible copyrighted item from reselling the item to whomever they want at whatever price they want.

However, copyright law has another provision that allows copyright owners to block the importation of copyrighted works into the United States. In the 1998 Quality King case, the US Supreme Court said that the First Sale doctrine trumped the importation right when the goods were manufactured in the US, sold overseas, and then imported back to the US. However, in Pearson v. Liu and John Wiley & Sons v. Kirtsaeng, the judges said that the importation right trumps the First Sale doctrine when the goods were initially manufactured overseas. This issue is ripe for further adjudication, though. A similar importation case, Costco v. Omega, is pending before the US Supreme Court, which is deciding whether or not it wants to hear the case. If it does, we may get clearer instructions about the interplay between the First Sale doctrine and the copyright importation right.

Copyright’s First Sale doctrine was also at issue in Vernor v. Autodesk, where the purchaser of a software disk wanted to resell the disk on eBay despite restrictions in the software licensing agreement barring such resales. The court held that the First Sale doctrine applied and allowed the resale. There are other cases percolating through the court system involving the resale of tangible media contained copyrighted material despite contractual restrictions on resale, so this issue remains a hot one.

Trademark owners also try to prevent competition with their products that leak out of their official channels of distribution. eBay has been the site of a couple battles over the First Sale doctrine in trademark law. In Mary Kay v. Weber, the court held that the trademark First Sale doctrine may not permit the eBay resale of expired cosmetics by a Mary Kay independent beauty consultant. In Beltronics v. Midwest, a trademark owner shut down the eBay resale of radar detectors that had leaked out of the manufacturer’s channel and were being sold (at a cheaper price) without the manufacturer’s warranty.

Clearly, the First Sale doctrine matters a lot to eBay and other consumer-to-consumer e-commerce websites. With a possible pending Supreme Court case and lots of IP owners looking to stifle competition from goods they have already profited from, expect the First Sale doctrines to get lots of attention in 2010.

#3: 47 USC 230. In my opinion, 47 USC 230 is the most important Cyberlaw statute, so new 230 developments will make my top 10 list for the foreseeable future. This year, there were three federal appellate court rulings interpreting 47 USC 230(c)(1):

* in Barnes v. Yahoo, the Ninth Circuit held that 230 protected a website’s negligent delay in removing user content. However, if the website had promised removal to the user, the user could have a viable claim for promissory estoppel that would not be preempted by 230.
* in FTC v. Accusearch, the Tenth Circuit held that a website’s resale of pretexted phone records—even if those records were supplied by third party suppliers—did not qualify for 47 USC 230 protection because of their illegality.
* in Nemet Chevrolet v. ConsumerAffairs.com, the Fourth Circuit held that a consumer review website was not liable for user-supplied reviews, even when the website worked with the user to submit the review, and despite the plaintiff’s unsubstantiated claims that the website had fabricated the reviews itself.

Really, the big 47 USC 230 news in 2009 is the absence of big news. Specifically, 2009 reinforced that the Ninth Circuit’s 2008 Roommates.com decision—one of the most significant defense losses under 47 USC 230—did not rip open a major hole in the statutory protection of websites. Of the 13 cases that I have seen that have cited the Roommates.com en banc opinion, eleven have cited the case in favor of the defense. (See the list here). The two exceptions are the Accusearch case, mentioned above, and the New England Patriots’ lawsuit against StubHub over season ticket resales, an odd opinion that may not have much influence. Therefore, despite our fears about Roommates.com, the 47 USC 230 immunity remained healthy and vibrant in 2009. For more on this topic, see my special recap of 47 USC 230's year-in-review for 2009.

#2: Keyword Advertising Battles. Keyword advertising battles are another perennial topic on these year-in-review lists. A multi-billion dollar a year industry has sprung up around the sale of keyword-triggered advertising, including some keywords that may be third party trademarks, and trademark owners don’t like it at all. This has led to a multi-front battle between trademark owners, keyword advertising sellers (such as Google), and keyword advertising buyers.

One of the biggest Cyberlaw cases of the year was the Second Circuit’s ruling in Rescuecom v. Google. In the district court in 2006, Google won an easy victory against a trademark owner because the court said that Google did not make the requisite “use in commerce” of the trademark. The Second Circuit reversed the district court, sending the case back for further proceedings. The reversal does not ensure Google’s defeat; Google will now litigate other legal doctrines and might very well win on one of those. However, the Second Circuit’s opinion largely spells the end of any “use in commerce” defense by either keyword advertising sellers or buyers.

Because of the “use in commerce” defense’s demise, keyword advertising cases will now likely turn on whether the advertisements create a likelihood of consumer confusion. One case, Hearts on Fire v. Blue Nile, offered up a new and complicated test for gauging consumer confusion. If other courts adopt this test, keyword advertising cases will get even more expensive and complicated—highlighting how important it was that the Rescuecom case eliminated an easy way to end these lawsuits early.

Meanwhile, despite the fact that keyword advertising battles have been taking place for at least a decade, we have not heard what a jury thinks about the practice—until the November jury ruling in Fair Isaac v. Experian. In that case, the jury found for the defense that the keyword-triggered ads did not create the requisite likelihood of consumer confusion. It remains to be seen if other juries reach the same conclusion. If they do, keyword advertising lawsuits should slowly fade away over time because the trademark owners can’t win in the end.

As for now, keyword litigation is going strong and hardly fading away. In Spring, Google made two changes to its trademark policies where it voluntarily agrees to take down certain types of ads at the trademark owner’s request. In May, Google extended its more liberal US-based policy to nearly 200 other countries, replacing the more restrictive policies it had in place there. Shortly thereafter, Google modified its US policy to do less for trademark owners in situations involving product resales, review websites and sales of complementary/replacement parts. Trademark owners were none too pleased with these changes. In response to these changes and the door opened by the Second Circuit Rescuecom decision, Google got hit with about a dozen new lawsuits, including some class action lawsuits, of which I believe 10 are currently still active.

Finally, all of the wrangling in court and over voluntary trademark policies could be mooted by legislative action, and for the third time, the Utah state legislature considered resolving the keyword advertising issue itself. A law regulating keyword advertising passed the Utah house but died in the Utah senate. Expect the pro-regulatory forces to round up the troops for a fourth try in 2010.

#1: FTC Endorsement Guidelines for Bloggers. The Obama administration has breathed new life into a pro-regulatory FTC, and the FTC sure is interested in all things Internet. The FTC has been nosing around Internet privacy and Internet marketing practices pretty carefully, and I expect 2010 to bring more FTC pronouncements designed to tackle the Internet.

But nothing stirred up a hornet’s nest of confusion and anger in 2009 like the FTC’s Endorsement and Testimonials Guidelines. I think it’s fair to say that the FTC’s guidelines rollout was a complete failure. As usual, the FTC’s guidelines were mealy-mouthed and filled with conditional statements (the FTC hates to lay out bright line rules that might constrain their future discretion). However, the FTC’s general gist was clear: bloggers should disclose when they receive financial or other consideration for their blog posts.

Unfortunately, this general principle leaves open some fairly fundamental questions, like when is disclosure required in situations less clear than straight cash-for-posting, and where should disclosure be made, especially in space-constrained media like Twitter. Needless to say, unhappy bloggers can be very noisy, so blogger response to the FTC’s announcement was loud and vituperative. The FTC tried to backpedal a little by saying that it did not intend to pursue individual bloggers, but this announcement only reinforced that bloggers do not understand what the FTC wants from them.

Meanwhile, the FTC’s proposed guidelines also took an interesting position about an advertiser’s liability for rogue blogger’s posts. This position is generally consistent with government enforcement agencies’ views that commercial players can be legally responsible for content they endorse or link to (see, e.g., my comments on the SEC’s liability-for-linking policy), but this position runs directly contrary to 47 USC 230’s provisions that say A isn’t liable for B’s online content. As a result, I believe that part of the FTC’s proposed guidelines violate 47 USC 230 and would not survive a court challenge.

Overall, the firestorm over the FTC’s Endorsement and Testimonials guidelines is a small part of a larger effort to regulatorily separate advertising from content. The Internet has collapsed those distinctions, perhaps irreparably, so regulators may be trying to accomplish the impossible. Nevertheless, the FTC seems determined to prop up the distinction, and I expect 2010 will bring more FTC efforts on this front.

* * * * *

While that concludes my top 10 list, there were a number of other interesting developments in 2009 that are worth a brief note:

* Moreno v. Hanford Sentinel. A woman trashed her hometown in an obscure but public MySpace posting and learned there is no “do-over” for Internet content publication. My vote for the most factually interesting Cyberlaw case of 2009.

* Google’s keyword metatag announcement. Courts generally treat the inclusion of third party trademarks in keyword metatags as per se trademark infringement. But Google has confirmed that it ignores keyword metatags. Will courts get the message?

* Google Book Search settlement. If the Google Book Search settlement ever gets approved, it may reshape the book industry, redefine libraries, and make all kinds of other socially significant changes. But the list of opponents to the settlement is long and growing. Professor James Grimmelmann of New York Law School is our community’s maven for all things “GBS.”

* Kindle book deletion. The Kindle store sold e-books it didn’t have the right to sell, so it took them back. Users learned of a key factual difference between physical books and e-books—the vendor can remotely make e-books go poof.

* States’ efforts to impose sales tax efforts based on marketing affiliates. For years, states have been looking for ways to make online retailers collect sales tax for them. They are generally stopped by Supreme Court precedent, but in 2008 New York finally figured out a workaround. The New York statute said that marketing affiliates were like traveling salespeople and thus created the physical nexus required for a state to impose sales tax collection obligations. The New York statute survived its first legal challenge, which opened the floodgates of other states passing similar laws hoping to get their piece of the action. Meanwhile, online retailers aren’t just rolling over; instead, they are threatening to cut off (or actually cutting off) marketing affiliates in states that enact these laws—thus potentially costing the states income tax from the marketing affiliates’ revenue, and creating the potential for the entire affiliate industry to be torn apart.

* Maine kids privacy law. Maine thought it could pass a law banning marketing to kids. It was wrong. The state had to withdraw the law and go back to the drawing board.

* UMG v. Veoh. Veoh won another nice DMCA online safe harbor victory.

* US v. Kilbride. The Ninth Circuit says that online obscenity prosecutions need to evaluate national attitudes towards obscene content, not local community standards.

* Kentucky domain name seizure. Kentucky tried to grab 141 domain names that enabled Kentucky residents to engage in illegal gambling. But those domain names also serviced customers for whom the gambling was completely legal, so the Kentucky courts are rethinking the grab.

* FTC v. Sears. As another example of the new pro-regulatory winds blowing through the FTC, the FTC cracked down on Sears for installing spyware on users’ computers that looked at the users’ hard drives, even though Sears paid the users for the installation and disclosed the spyware’s snooping in the user agreement (though in an inconspicuous manner). This case has made a lot of lawyers concerned that adverse disclosures in user agreements won’t satisfy the FTC.

* Facebook the Drama Queen. Ah, Facebook. Love it. Hate it. Facebook is a pretty nifty site and part of my daily routine, but boy, they sure do have a knack for stirring up trouble.

- In February, they made a relatively modest change to their user agreement that caused people to freak out.
- In response to this, Facebook took the provocative step towards user self-governance. Facebook let users vote on some choices and promised to be bound by the results, but with an asterisk: Facebook decided what options users could vote on, and Facebook would honor those choices only if a prohibitively large number of users exercised their franchise. Still, it was a nice gesture towards cyberspace community self-governance.
- In summer, they tried to settle their Beacon litigation, but that also reminded folks of how much Beacon irritated them in the first place.
- Summer also brought allegations of click fraud on Facebook, and lawsuits followed.
- Finally, in Thanksgiving, Facebook rolled out some changes to its privacy options that it pitched as giving users more choices, but it also took away some choices and defaulted users into some options that surprised them.

Given this track record, is it unrealistic to expect more Facebook drama in 2010?

* Estavillo v. Sony. Speaking of self-governance, virtual world enthusiasts would love to establish the legal proposition that virtual worlds are legally equivalent to governments and therefore obligated to restrain their actions just like governments are. One virtual world enthusiast sued Sony for kicking him off the network, claiming that Sony was legally governed as a “company town” and therefore lacked the discretion to kick him off. WRONG (and it wasn’t even close).

* Wikipedia's policy change. In August, the English-language Wikipedia announced that it was going to tighten up its editorial policies, and people Freaked Out. (In fact, I have predicted that Wikipedia cannot avoid increased editorial restrictions over time, so this change should not have been surprising). However, it turns out that everyone got it wrong, and Wikipedia’s editorial changes are far less dramatic (and consequential) than initially reported. I will post a separate recap on Wikipedia shortly.

If you would like a stroll down memory lane, you can see my previous top 10 lists from 2008, 2007 and 2006. Before that, John Ottaviani and I put together a list of top Internet IP cases for 2005, 2004 and 2003.

Posted by Eric at 10:46 AM | Content Regulation , Copyright , Derivative Liability , Domain Names , E-Commerce , Internet History , Licensing/Contracts , Marketing , Publicity/Privacy Rights , Search Engines , Spam , Trademark , Virtual Worlds | TrackBack

December 26, 2009

November-December 2009 Quick Links, Part 1

By Eric Goldman

Trademarks/Domain Names

* Yahoo and Mary Kay settled Mary Kay's trademark lawsuit over Yahoo's email shortcuts.

* uBID Inc. v. The GoDaddy Group Inc., No. 09-cv-2123 (N.D. Ill. Nov. 5, 2009). uBid’s anti-domain name parking lawsuit failed on jurisdictional grounds. Tom O'Toole explains why this is an unusual jurisdictional ruling.

* Trademark Blog: “Sellify, operator of ONEQUALITY.COM, sues Amazon over Amazon affiliates' alleged misuse of ONEQUALITY.COM as Google keywords.”

* In an unenlightening memo opinion, Second Circuit affirms the Cintas v. Unite Here opinion involving union activists’ web activities using a target company’s trademark. My initial blog post on the case.

* Bloomberg: Buyers of counterfeit luxury goods understand they are getting counterfeits, and many of them upgrade to the real thing eventually.

* Transamerica v. Moniker Online Services, 2009 WL 4715853 (S.D. Fla. Dec. 4, 2009). Domain name registrar does not qualify for ACPA's registrar safe harbor when: "Transamerica alleges that Oversee and the Moniker Defendants, together with the ostensible registrants-the John Doe Defendants-are the de facto registrants of the domain names in question. Transamerica claims that Moniker was not merely acting as a registrant in providing registration services to the John Doe Defendants for the infringing domain names, but instead was part of a scheme to profit from the use of the infringing names. As Transamerica points out, Moniker receives a fee each time an internet user clicks on one of the links attached to the infringing domain sites; such payment establishes at least partial ownership in the domain name." Troubling ruling.

* SafeWorks, LLC v. Spydercrane.com, LLC (W.D. Wash. Dec. 7, 2009). A trademark owner's preemptive registration of domain names containing typographical errors of the registrant's trademarks does not infringe a third party trademarks.

Marketing and Advertising

* In re Gemtronics (FTC ALJ decision Sept 16, 2009). A dietary supplement seller wasn't liable for comments on a website that it didn't own or control but (among other things) it had linked to. While this is great, I still believe the FTC needs to rethink its entire liability scheme of online content endorsement or adoption due to 47 USC 230. See 1, 2.

* Avvo settles Florida bar lawsuit and gets Florida to admit that client testimonials on Avvo aren't lawyer advertising. Rebecca explains why an analogous South Carolina regulation violates 47 USC 230.

* After the FDA spooked pharmaceutical companies to stop engaging in search advertising, the FDA held hearings on Internet pharmaceutical marketing. The Arnold & Porter recap. Ironically, BusinessWeek ran a story wondering if pharmaceutical ads reduce consumer demand.

* The FTC cracks down on online negative option/"continuity plan" offerings.

* In re Miva Inc. Securities Litigation, 2009 WL 3821146 (M.D. Fla. Nov. 16, 2009). The court dismissed a securities class action lawsuit over Miva's/FindWhat's investor disclosures relating to click fraud and spyware. My initial blog post on the case.

* NYT: False advertising litigation is a growth industry.

Search Engines

* A Milwaukee lawyer has alleged that another lawyer buying keyword advertising triggered by his name violates his publicity rights. I’ve posted the complaint to Scribd.

* Google is now personalizing search results for everyone, not just logged-in users. In 2006, I wrote about how universal personalization would affect SEO and concerns about search engine bias. Danny Sullivan believes Google’s change deserves "extraordinary attention."

* Google took out an ad from itself to explain why its image search results for Michelle Obama contained an offensive result. This is after it first tried to remove the image on the pretext that the website was hosting malware.

* Danny Sullivan asks some good questions about Google's integration of Twitter into its search database.

* BusinessWeek: Matt Cutts, Google’s search engine anti-spam superstar, talks about his job. He doesn't sound like the most fun person to travel with

* Rose Hagan, Google's chief trademark counsel, is retiring after 7 years at Google. She leaves behind big shoes to fill.

Posted by Eric at 02:59 PM | Adware/Spyware , Derivative Liability , Domain Names , Licensing/Contracts , Marketing , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

December 18, 2009

Top Cyberlaw Developments of 2009

By John E. Ottaviani

(Thanks to Eric for letting me post this list here!)

[Eric's note: some of you may recall John, a regular blog guest contributor from 2005-07. It's great to have another contribution from him.]

Eric will post his own list later, but I thought we could start off the holiday season with one person’s view of the top Cyberlaw developments of 2009. It was an interesting year. While intellectual property issues continue to dominate, and we continue to see plaintiffs and their attorneys running smack into Section 230 of the Communications Decency Act, we’ve also seen developments in the areas of Constitutional law, criminal law, and state and federal regulation. So, let’s recap 2009. Unlike David Letterman’s lists, this list is in no particular order of importance.

1. File Sharing Decisions.

After years of lawsuits against file sharers, we finally have two trial decisions. Both held against the peer-to-peer file sharers. Jammie Thomas managed to turn a 2007 verdict of $222,000 (which was later thrown out due to a mistrial) into a 2009 verdict of $1.29 Million. Her motion to reduce the award is pending.

Joel Tenenbaum received more favorable treatment and was subjected to only a $675,000 jury verdict after he admitted liability and his fair use defense was rejected by Judge Gertner. His motion to appeal/reduce the award is due to be filed in early January. Judge Gertner wrote a compelling decision urging Congress to modify the strict liability consequences of new technologies such as peer-to -peer file sharing. In her decision rejecting the fair use defense, Judge Gertner implored Congress “to amend the [Copyright Act] to reflect the realities of file sharing. There is something wrong with a law that routinely threatens teenagers and students with astronomical penalties for an activity whose implications they may not have fully understood. The injury to the copyright holder may be real, and even substantial, but, under the statute, the record companies do not even have to prove actual damages.” We’ll see if Congress listens.

2. Rise of Copyright First Sale Doctrine.

There were several decisions that turned on applications of the copyright “first sale” doctrine to new online situations. Section 209(a) of the Copyright Act permits the owner of a lawfully made copy of a work to sell or dispose of that copy without the consent of the copyright owner.

First, the held that resales of the AutoCAD software were permitted under the first sale limitations in Section 109(a). The court found that although the underlying documents were styled as “licenses,” the fact that the licensee was entitled to perpetual possession of the copies was the key fact.

We also had two cases (John Wiley & Sons; Pearson Education v. Liu) dealing with the importation of copyrighted works (mostly textbooks) printed abroad and then imported into the United States for sale. Two courts said these transactions are not protected by the first sale doctrine because of the importation provision in Section 602. The courts so far have been following dicta in the Supreme Court’s 1998 Quality King case that goods manufactured overseas and then imported are not protected by the first sale right, despite their reluctance to do so. We may get a resolution of this issue in 2010. The U.S. Supreme Court has invited the Solicitor General to file a brief in the Costco Wholesale Corporation v. Omega, which is on a petition for certiorari to the Ninth Circuit Court of Appeals.

A third entry is Apple v. Psystar. Psystar specialized in creating copies of Apple’s Macintosh OS-X operating System and loading them onto Mac “clones.” The court rejected the first-sale doctrine defense because Psystar’s copies of the Macintosh OS-X operating system were not “lawfully made” within the meaning of Section 109. The parties subsequently settled all claims except for copyright infringement, and Apple obtained a permanent injunction against Psystar.

3. Demise of “Use in Commerce” Defense in Keyword Cases.

In Rescuecom v. Google, the Second Circuit reversed the district court and said that Google’s sale of trademarked keywords as ad triggers constitute a “use in commerce.” This probably is the end of the “use in commerce” defense in keyword advertising cases, which will now turn more on likelihood of confusion (or initial interest confusion) factors.

4. Internet Gambling.

Internet gambling continues to be regulated by a tangle of federal laws ill-adapted for the purpose. Some of the laws date back to the 1961 adoption of the federal Wire Act. This is an areas where Congress should really clean things up, especially with criminal liability sometimes at stake.

Proponents of online gambling took a couple of hits in 2009. In Interactive Media Entertainment and Gaming Association v. Holder, the Third Circuit upheld challenges to the Unlawful Intent Gambling Enforcement Act (UIGEA) on Constitutional grounds. The UIGEA does not prohibit Internet gambling, but does prohibit gambling businesses from accepting financial payments in connection with bets that are illegal under any federal or state law. (This Act has effectively forced legitimate offshore gambling sites to stop taking bets from the United States). The Third Circuit held that the phrase “unlawful Internet gambling” is not vague, and that there is no Constitutionally protected privacy right to gamble in one’s home.

Earlier in the year, the Department of Justice ordered four banks to freeze over $34 million in payments owed to about 27,000 poker players. Although the legality of online poker in the United States is a gray area, the DOJ takes the position that online poker games are prohibited by the federal Wire Act. The DOJ position runs counter to several court decisions that have refused to apply the Wire Act to non-sports related Internet gambling. After the funds were seized, the affected poker sites reportedly reimbursed the players the money that was seized.

5. State Attempts to Regulate the Internet.

This trend, a favorite target of Eric’s ire, continued in 2009. Some more notable attempts include Maine’s passage of a little COPPA Act, banning the use of personal information about minors for marketing purposes (which the Maine Attorney General then refused to enforce), Kentucky’s seizing of domain names associated with alleged gambling websites (the legality of which is pending before the Kentucky Supreme Court), and Utah and other state’s attempts to put sex offender information online or require sex offenders to register websites to which they belong and their passwords.

6. Attempts to Criminalize Breaches of Terms of Use.

Lori Drew created a fake MySpace profile to humiliate a 13-year-old neighbor girl and was subsequently blamed for the girl’s suicide death. Drew was convicted of three misdemeanor counts of unauthorized access to computers under the federal Computer Fraud and Abuse Act for violating MySpace’s terms of service. In United States v. Drew, the court dismissed Lori Drew’s conviction, concluding that MySpace’s terms of service were Constitutionally vague. The result is not surprising, because terms of service are not generally written with criminal prosecution in mind. The MySpace terms at issue prohibited a wide variety of conduct but did not explain what activities would make a user’s access “unauthorized”. The user’s conduct was reprehensible, but not criminal.

7. Online Endorsements.

In October, for the first time since 1980, the Federal Trade commission updated its guidelines for advertisers on how to keep their endorsements and testimonial advertisements in line with the FTC laws. The new guidelines explicitly target online endorsements by bloggers and others who receive cash or in-kind payments to review a product. Bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. While the new guidelines caused a stir among bloggers, they seem to be a reasonable extension of the FTC’s disclosure guidelines in other contexts

8. DMCA Take-Down Notices.

In UMG Recordings v. Veoh Networks, we received some further guidance on what constitutes a proper take-down notice. Here, the court said the copyright owner has the burden of identifying “potentially infringing materials.” A letter merely listing recording artists whose works were allegedly infringing did not give the Internet Service Provider actual knowledge of infringement because the letter does not comply with the DMCA requirements. The court also said that the ISP was not on general notice of copyright infringement just because the website allows users to post music files, which are frequently infringing content.

9. Section 230 of the Communications Decency Act.

There are too many cases to list here, and I am sure Eric has done (or will do) his own exhaustive compilation. The courts clearly expanded the scope of the Section 230 defense in various Craigslist cases (no liability for advertisements for guns or prostitution).

Barnes v. Yahoo showed us that service providers should not make statements and then not follow though. In that case, the plaintiff’s ex-boyfirend created fake personal ads for her on Yahoo and impersonated her in various online forums. She asked Yahoo to take the information down,. A Yahoo employee told her that Yahoo would take the profile down, but Yahoo did not do so until after the complaint was filed.. The Ninth Circuit upheld Yahoo’s Section 230 defenses for claims that Yahoo had an obligation to take the fake profiles down, and that Yahoo did not try to remove some objectionable material. But the court did permit the plaintiff’s claim to go forward that Yahoo had breached its oral contract with her to take the material down, which the Court held amounted to a modification of the “baseline” Section 230 rule.

10. Right to Privacy.

When someone publishes something on a MySpace website without her full name, and then deletes the post, does she have an expectation of privacy? In Moreno v. Hanford Sentinel, Inc., the California Court of Appeals said no. Here, the plaintiff posted an essay that was derogatory of her home town on her MySpace page and then deleted it six days later. In the meantime, the principal at the local high school saw the posting and submitted the poem to a local paper, where the editor (a friend of the principal) published the poem in the Letters to the Editor column and signed the plaintiff’s full name to it. The author and her family received death threats and her father had to close a 20-year old family business. However, the California Court of Appeals ruled that the principal did not invade the author’s privacy by handing the posting to the editor, and further held that the editor did not violate the author’s rights when it published her full name. (The case was remanded in order to address a claim of intentional infliction of emotional stress.)

Let’s hope 2010 brings even more exciting Cyberlaw developments. We have the potential for two Supreme Court rulings, in the Costco case (discussed above) and the Bilski case, which may address the validity of business method patents.

Posted by John Ottaviani at 07:04 AM | Content Regulation , Copyright , Derivative Liability , Domain Names , E-Commerce , Licensing/Contracts , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

December 11, 2009

Denver University “Cyber Civil Rights” Symposium Recap

By Eric Goldman

The week before Thanksgiving, I attended an unusual symposium sponsored by the University of Denver Law Review entitled “Cyber Civil Rights: New Challenges for Civil Rights and Civil Liberties in our Networked Age.” The symposium covered standard Cyberlaw topics, but the raison d'être was University of Maryland law professor Danielle Citron’s two recent articles on online harassment of women: "Law's Expressive Value in Combating Cyber Gender Harassment" (Michigan Law Review) and "Cyber Civil Rights" (Boston University Law Review). It is unusual for a law school to celebrate another school’s professor and her research, especially when the professor is fairly junior. Nevertheless, Danielle’s participation brought together academics from both the Cyberlaw and civil rights communities, which provided a rare and interesting mix of folks..

First Panel

Danielle Citron started off by recapping her two papers. Online participation, such as blogging, is essential to professional standing, and employers are reviewing online profiles of prospective employees as part of their hiring considerations. However, women are being targeted for abuse online. These attacks are harming women by changing their online and offline activities, reducing their job opportunities, and causing women to change their gender representations online. Further, folks are trivializing these problems. Women are underreporting the attacks, and law enforcement only intervenes when there are offline harms. New laws can serve an expressive function to communicate that online attacks against women are socially unacceptable. The new laws can validate women’s feelings that they have been harmed and encourage law enforcement to pursue more cases.

Commenting on the papers, Robert Kaczorowski of Fordham Law (and Danielle’s stepdad) made an extended analogy between the Ku Klux Klan and cybermobs.

Wendy Seltzer asked if we could deemphasize the effect of words rather than prohibit them. Danielle responded that we don’t know how seriously to take any particular threat.

An audience member asked if is there a difference between mobs and individual actors who are just taking advantage of being anonymous. Danielle answered that groups can become more extreme online. I think this point deserves more exploration: a series of uncoordinated individual decisions to “pile on” to an attack can look like a coordinated attack to the victim. This is part of why I thought the KKK references were puzzling—KKK activities are clearly coordinated, while online attacks against women can succeed without any coordination or ongoing connection between the attackers.

Paul Ohm argued that that legal solutions are better for cyber civil rights problems than technological solutions. Paul discussed what he labeled “Felten’s Third Law.” (He doesn’t know of two earlier laws named for Ed Felten; he just assumes they exist given Ed’s impressive and influential oeuvre). As articulated by Paul, Felten’s Third Law is that in Cyberlaw conflicts, lawyers love technical solutions and technologists love legal solutions. In other words, we love the solution we don’t know because we assume it has to be better than the one we do. As both a law professor and technologist, Paul picks law over technology for these problems.

Paul categorically rejects any technical solution that would create a “fully identified Internet.” For example, we should not mandate server log retention because we know the logs will be co-opted to regulate other forms of unwanted content, not just online harassment.

Wendy Seltzer discussed the unintended consequences of legal intervention. For example, mandatory Internet filtering in school libraries hasn’t stopped kids from bypassing the filters, but it has facilitated a marketplace for improving filtering technologies that has benefited repressive regimes. Another example: anti-circumvention technology fails to restrict copying but has reduced innovation around DRMed content. Wendy also noted how norms can help curb abuses. For example, while there are online cesspools, she praised Wikipedia’s evolving guidelines for living people’s biographies.

In response, Danielle admitted that her solutions need to be more surgical. She said she might consider moving from a notice-and-takedown model to a notice-and-preserve model for intermediaries.

Second Panel

This panel was composed of three women academics from the civil rights community, so it was a noticeable shift from the typical Cyberlaw academic discussion.

Mary Anne Franks is a University of Chicago Bigelow Fellow and soon-to-be full-time law professor. She expresses our collective disappointment that cyberspace isn’t a utopia that allows people to escape offline discrimination and harassment. She laments that women can lose control of their identities online, such as when someone creates a fake online profile in their names.

She then addressed how cyberspace is unique/special/different with respect to gender harassment. Many commentators try to duck cyberspace exceptionalism, so it was refreshing to see her tackle the issue squarely. Existing offline discrimination/harassment laws assume interactions between repeat players at work and school; online harassment can be divorced totally from any existing social networks. However, because the online activities still harm targeted individuals at work and school, we should treat the harms the same. Offline, there are switching costs to changing jobs or school; online, search engines’ consolidation of results for search on a person’s name creates a different type of switching cost. In terms of supervisory power, she thinks web operators have analogous control to employers or school administrators. Thus, when web operators receive notice of online harassment, they should have a duty to do something about it. Offline, employers can develop a variety of responses and policies to combat workplace harassment. Web operators should have similar latitude; for example, they can delete offending posts or suspend/ban accounts.

Helen Norton, a University of Colorado law professor, did not share Danielle’s optimism (expressed in her first article) that existing discrimination laws can curb online harassment. Instead, Helen thinks a new civil rights statute is needed, but she might limit its remedies to exclude money damages. Helen is pessimistic that there will be regulation any time soon, noting that it can take years to enact civil rights legislation. Helen would also like to see more precise definitions of the exact harms that women are experiencing only online.

Nancy Ehrenreich, a Denver University law professor, began her talk by saying that we should not overstate the Internet’s benefits. She then clarified that we should not assume that disadvantaged folks can overcome barriers online. For example, we impose cultural categories on people in every interaction, so even if people try to mask their identity online, they can’t really escape. She wondered why we aren’t talking about an anti-discrimination law for the web. Her concern is that discrimination denies individuals access to the Internet.

In Q&A, Paul Ohm observed that civil rights scholars often invoke free speech as the countervailing concern to their desired regulations, but Cyberlaw scholars are often more interested in other “generative” effects of the Internet, such as new business models, new labor models and new modes of production.

Panel 3

James Grimmelmann (see his slides) started with the Skanks in NYC case. In that case, the defendant criticized someone else in her social network on a blog, calling the plaintiff (among other unflattering things) a “skank.” The plaintiff sued to obtain the blogger’s identity. After a successful unmasking, the plaintiff dropped the lawsuit, having successfully publicly shamed the blogger.

James hypothesized that this unmasking and shaming was an appropriate remedy—the blogger got shamed (like “an eye for an eye”), and unmasking is a better outcome than other legal remedies like damage suits. James then posited a thought exercise that provided plaintiffs with an expedited unmasking procedure if they drop any damages claim. This would have a number of benefits. Unmasking curbs online harassment is especially effective at busting online mobs. Also, an unmasking remedy avoids messy debates over the First Amendment’s scope, and it may be more desirable than trying to hold online providers liable.

Having advanced his own strawman, James then cut it down. In some cases, defamation remedies may be more desirable, and plaintiffs may not know that until they learn the putative wrongdoer’s identity. In other cases, plaintiffs who just want unmasking would appreciate a lower legal hurdle. Also, we provide legal protection for anonymity for good reasons.

James’ lessons from the thought exercise: we should consider ways to decouple an unmasking remedy from litigation. At the same time, we need to protect defendants from pretextual unmasking; in some cases, retaliation is a big concern, and we should incorporate this concern into the unmasking decision.

From Chris Wolf’s talk (see his full remarks), the most interesting thing I learned is that 18 states have laws banning wearing masks in public, enacted to suppress KKK activities. This was the second speaker’s KKK reference of the day, and it made me wonder if we were experiencing some variation of Godwin’s Law.

Panel 4

Viva Moffat observed that secondary liability issues generate the most heat in online harassment discussions. She expressed concern that imposing legal duties on third parties may not help law’s norm-shaping effect, and it’s not appropriate to impose liability just because the provider has deeper pockets or the direct actor can’t be found. She also suggested that imposing liability on third parties creates a greater risk of collateral damage than direct liability. [Note: I would like to know more about this last assertion. I suspect we cannot make a utilitarian calculation a priori]. As a result, she favors focusing more efforts on sharpening direct liability.

Ed Felten talked about identifying and anonymizing online activity. He explained the usual sequence of events in chasing bad online content:

log file => IP address => identity => justice

But the IP address => identity step breaks down when users use an anonymizing proxy or the user’s network uses network address translation (used by home wireless routers or in coffee shops) and all connected devices’ requests share a single IP address. He said that a majority of Internet connections use NAT.

Because IP address tracebacks can dead-end at the intermediary, an IP address can reveal too little information. However, even when users aren’t investigatory targets, IP addresses can reveal too much information, such as geolocation. This paradox—IP addresses simultaneously reveal both too much and too little information—reflects that the IP address system was built for routing, not identification. So could we design a better authenticating technology?

He then conducted a “semi-realistic” thought experiment of a new technological “tag” that could be used instead of IP addresses. This tag could have the following attributes:

* can be placed by any intermediary
* conveys no information about the sender unless unwrapped by the intermediary (presumably for good legal cause)
* unwrapping the tag yields the best identity information the intermediary has
* the tag’s use is voluntary as a technical matter
* the tag is removable as a technical matter

I then batted clean-up. A summary of my remarks:

Today’s conversation has revisited long-standing Cyberlaw issues, such as:

* anonymity v. accountability, and who should be responsible for online content and actions
* cyberspace as a physical place. See, e.g., Noah v. AOL (an online discrimination case), National Federation of the Blind v. Target (also an online discrimination case) and Estavillo v. Sony
* cyberspace exceptionalism and cyberspace utopianism (on the latter point, see my article on search engine utopianism)
* when is the optimal time to regulate rapidly evolving technology? Early, when the technology is still in its infancy, or later, when market forces and new technological evolutions may have cured the early problems?

Danielle’s articles convinced me that women are experiencing serious harms online that men—including me—could easily trivialize. Danielle’s articles also convinced me that online harassment has strong parallels to the 1970s legal evolution of workplace harassment doctrines, where a big part of the battle was to get people to take the harms seriously.

While I find a lot of descriptive value in Danielle’s work, the normative implications are not as clear. As usual with attempts to regulate rapidly evolving technology, there are many important but overwhelmingly hard definitional challenges, such as who is an “intermediary,” what are “online mobs” and what constitutes online “harassment.” For example, I do not think the Skanks in NYC incident is an online harassment case or an “attack,” but James Grimmelmann’s talk assumed those characterizations.

While we can debate what should be the right level of regulatory intervention, we should not overlook that Congress already enacted a law squarely governing intermediary liability for online harassment: 47 USC 230. The angst that prompted this conference—bad behavior online—is the logical consequences of 230’s broad immunity. The statute enables websites to adopt policies that they will not police user content or retain server logs of user activity. These choices aren’t a surprise or a per se abuse of the immunity; instead, they are the unavoidable implications of Congress’ action.

We might question Congress’ wisdom in adopting 230, but we should not diminish its potential importance to the Internet as we know it. [In Q&A, Chris Wolf asked about the comparative experience in countries that don’t have such broad immunity. In those countries, we know that websites take down user content much more freely, and I believe that the most interesting UGC innovations are all taking place here in the US, not countries with more restrictive UGC liability.] I can, at most, only prove correlation and not causation, but I believe 230 is one of the main causal reasons why the Internet has succeeded so well.

When I speak around the country about 230, I often encounter folks who generally accept 230’s immunity scope but want just one new exception, i.e., their pet topic. If everyone got their “just one” exception, the law would be eviscerated. (I said it would be Swiss-cheesed to death; maybe I should have said it would be overcome by a thousand duck bites). I’m not rejecting new exceptions categorically (they should be each considered on their own merits), but in aggregate 230’s immunization benefits are actually quite precarious. I believe 230 works precisely because of its strength and simplicity, so adding more exceptions could significantly reduce its efficacy.

I concluded my remarks by observing that online harassment is a subspecies of bullying and incivil behavior in our society. While we can and should work to curb online harassment, I am more interested in addressing bullying and incivility in all its forms, wherever it takes place.

In this regard, I have been impressed by how my son’s school is proactively addressing bullying. See more about this effort, called Project Cornerstone. The school is teaching kids not to bully or to tolerate being bullied, and the project gives bullied kids tools to go on the offensive against bullies. There’s no guarantee that anti-bullying programs will work in the short or long run, but I remain hopeful that online harassment today partially reflects that many current Internet users never got any anti-bullying education. Perhaps, then, online harassment issues will naturally abate (without any regulatory intervention) as new generation of Internet users, better educated about bullying, come onto the Internet.

Following my remarks, we had more Q&A.

Paul Ohm Q: Some cyber folks argue against secondary liability because they believe that a victim can pursue a direct action, but Ed’s talk suggests that user anonymity will continue to be possible.

Mary Anne Franks: civil rights isn’t about individual claims because victims have to bear too high a burden to pursue claims. Instead, civil rights are about changing large-scale social norms. The goal is to achieve anti-discrimination by any means necessary. Thus, civil rights scholars have already discussed and concluded that it’s appropriate to impose liability on intermediaries like employers and schools.

Danielle: intermediaries are the lowest cost avoiders.

James Grimmelmann: no, the harassers are the lowest cost avoiders. Civil rights folks would get more support from the Cyberlaw crowd if they focused their regulatory desires towards intermediaries who are in active concert with the bad actors.

Danielle's Wrap-Up

We all agree that:

* education can make a big difference
* online communities need to self-police
* there are numerous limits to using the law as a solution, including that lawsuits don’t make sense and 230’s immunity.

We don’t agree on what to do next. There are First Amendment limits, and technology doesn’t offer any panaceas.

Posted by Eric at 07:12 AM | Content Regulation , Derivative Liability , Internet History , Publicity/Privacy Rights | TrackBack

December 02, 2009

Case Western “Signifiers in Cyberspace” Conference Recap

By Eric Goldman

In mid-November, I attended a conference at Case Western Reserve University School of Law in Cleveland, Ohio entitled “Signifiers in Cyberspace: Domain Names & Online Trademarks.” My notes:

David Fewer spoke about Canada’s WHOIS policy. The old Canadian registry policy published registrant information without restriction. Then, the registry proposed a new policy not to publish personal information in the WHOIS database for individual registrants and for organizations that can show harm from publication. To reveal registrant information in those situations, a warrant would be required. That policy got amended to allow warrantless access for cybercrime enforcement, registered IP infringement and ID theft. Fewer argued that the amended policy violates Canadian privacy laws (PIPEDA) because consumers are not given adequate disclosures, the exclusions from the privacy policy are arbitrary, and consumers aren’t given the required option not to participate.

Corynne McSherry of EFF discussed how TM owners are bypassing direct challenges against gripers and instead putting pressure on domain name registrars. She focused on the Yes Man spoof website of the New York Times, which included a parody ad of the De Beers diamond manufacturer. Humorless De Beers sought relief from Joker.com, the parodist’s registrar. EFF has responded to De Beers that the parody is legitimate because it has no commercial aspect, it’s nominative use, and the First Amendment applies. The EFF is also encouraging Joker.com to ignore De Beers because it (as the registrar) can’t be liable for the registered domain name. So why is Joker.com even entertaining De Beers’ complaint? Corynne notes the registrar’s revenue from any single domain name registration is less than legal cost of investigating and responding. Corynne discussed how parodists and gripers can minimize their legal risk (I blogged on these recommendations in May).

I remain very interested in situations where domain name registrars apply their own takedown policies to their customers. For example, I’ve previously mentioned GoDaddy’s “itchy trigger finger” when it comes to intervening with its registrants. I suspect there is significant heterogeneity among registrars’ interventionist tendencies. I think this is an area worth exploring. If you have other examples of domain name registrar intervention in its customers' content, please share them.

Stacey Dogan spoke about the aftermath of the Rescuecom ruling. Stacey is disappointed that courts aren't adopting her arguments to use the “trademark use in commerce” doctrine to insulate intermediaries (she calls it her “biggest failure in life”). She described three post-Rescuecom uncertainties: (1) what acts by intermediaries constitute TM infringement? (2) on what doctrinal basis? (direct v. contributory), and (3) what remedies do the intermediaries face?

Stacey thinks courts need to be more precise about the nexus between defendant behavior and TM owner harm. This should lead to better distinctions between direct and contributory infringement.

She offered a taxonomy of claims against intermediaries:

* General confusion = when the intermediary creates confusion through the blurring of ads and editorial content. Stacey thinks these aren’t TM issues. But if commingling is the problem, then the remedy should be an injunction requiring the intermediary to label the ads.

* Strict liability = when the search engine is automatically on the hook for its involvement with the ads. Stacey says courts should reject this approach due to the search engines' lack of proximate causation for consumer confusion. If a search engine faces any liability, it should be solely on the basis of contributory infringement (with its higher scienter bar).

* Failure to act = when the search engine fails to respond to TM owner’s takedown notice. She said we don’t see this in search engine cases [a point I disagree with given that the TM owner vs. search engine lawsuits all represent a failing of the search engines’ voluntary TM policies]; instead, she was thinking of the Tiffany case. Stacey thinks the failure of act prong is where the legal action should be. She wants courts to map out appropriate scienter levels. General knowledge of infringement isn’t enough, and courts should let defendants make reasonable judgments about whether the advertiser will qualify for any trademark defenses. If the advertiser is obviously infringing, and intermediary gets notice and fails to act, she thinks contributory liability could be appropriate.

Graeme Dinwoodie believes the ECJ will not follow the Advocate General’s opinion in the Google case. He explored two parallels between the AG’s opinion and Rescuecom: Both get away from trademark use of commerce, and both consider underlying policy values. Graeme thinks search engine defendants should move away from disputing the lack of harm to the trademark owner; instead, he thinks they will get more traction by showing the countervailing benefits of their advertising. For example, he thinks they should be showing how keyword advertising can facilitate investment and innovation.

Jeffrey Samuels shared his perspectives as a panelist in 200 UDRP proceedings. Since the UDRP’s implementation, there have been about 25,000 UDRP decisions. 40% are US registrations. 75% involve .com. 75% are defaults.

The UDRP isn’t designed to solve all domain name disputes. He gave an example of a domain name registration containing a celebrity child’s name. The UDRP isn't helpful because a 2 week old kid doesn’t have protectable trademark rights.

“The UDRP is hardly a model of clarity.” All cases are fact-dependent. If a UDRP proceeding has unusual facts, he recommends requesting a 3 member panel--these proceedings get more carefully evaluated opinions and minimize the effects of any one panelist’s idiosyncratic views.

Some issues that regularly arise in UDRP proceedings:

* What the TM owner has to do to establish its rights. The majority view is that a registration anywhere in the world suffices. Common law rights generally require presenting sufficient evidence validating the rights.
* There remains a split of authority on “sucks” sites.
* In the early days, panelists used to run through the multi-factor likelihood of confusion factors. That’s rarely done today. Now, most panelists just make sight and sound comparison.

Karl Auerbach discussed two interrelated issues: (1) ICANN lacks any political authority for its “Internet governance” role, and (2) technology does not require that ICANN monopolize DNS root services. He argues that we would benefit from competition among DNS root services. His argument reminds me a bit of the net neutrality debate. We can hypothesize many possible net neutrality problems, but most of them go away with vigorous competition. Similarly, ICANN’s often-ridiculous shenanigans would be less vexing in the face of bona fide competition for DNS root services.

Dan Hunter spoke about a new paper he’s writing with Mark McKenna. Their target is the fundamental trademark principle that trademark law protects against consumer confusion. They think consumer confusion is an imperfect proxy for our normative goal of protecting consumers. Some confusion is endemic in a complex society; and some methods of communication, like humor, require confusion to work. Therefore, they want to move away from trying to block consumer confusion and instead refocus trademark law on reducing errors in consumer decision-making. This seems like a fruitful endeavor, but they are also taking a swipe against the consumer search cost justification for trademark law, a move I didn't follow.

Bill McGeveran recapped his recent work on social networking sites and gave a preview of his next article. His target is fake online profiles such as the Tony La Russa fake Twitter account. He expects to see more pressure to create IP rights in personal identities.

I spoke about trademarks and behavioral targeting, and in particular the competition among marketers for consumer preference information. For example, I believe the anti-deep packet inspection pushback wasn’t based solely on privacy concerns. Instead, destination websites fear that an IAP will disintermediate them and use its prime access to consumer preference information to steer customers to competitors. (See this blog post for more on that point). My (very brief) slides.

Posted by Eric at 07:16 AM | Derivative Liability , Domain Names , Internet History , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

November 03, 2009

Law Professor Sues Over 'Above the Law' Blog Posts--Jones v. Minkin

By Eric Goldman

Jones v. Minkin, 1:09-cv-23256-MGC (S.D. Fla. complaint filed Oct. 27, 2009). The Above the Law blog post on the lawsuit with links to the posts in question.

Given its history of provocative and occasionally aggressive blog posts, it's actually a little surprising that popular law blog Above the Law has not been sued before. A blogger's life is inherently filled with peril. We bet our houses with every blog post, and eventually the law of large numbers starts working against us. The risks are even greater for bloggers covering legal topics. By definition, we routinely cover people who are prepared to mix it up in court. As a result, it's almost inevitable that blawgers who keep at it long enough will get sued eventually.

The plaintiff in this case is University of Miami law professor D. Marvin Jones, who in 2007 was improperly detained by police for possibly racist reasons. This prompted a series of blog posts on Above the Law that included an unflattering cartoon and unfavorable characterizations. Jones now claims that the blog posts put him in a false light, invaded his privacy and constituted copyright infringement because the blog posts used the photo from his university profile page. Although the complaint uses the word "defamation" earlier in the pleading, no defamation claim was alleged. For these violations, Jones asks for tens of millions of dollars to right the alleged wrongs.

I'm skeptical about all three claims, but the copyright claim is almost unquestionably bogus. It's not properly pleaded; there's no allegation of a copyright registration. More importantly, I would be shocked if Jones owned the copyrights in the photo on his faculty page. Usually faculty photos are taken by a university photographer or a third party vendor; in either case, the photo subject normally does not obtain ownership or an exclusive license to the copyright. Perhaps Jones has managed his IP affairs better than 99+% of professors. If not, 17 USC 505, the copyright fee-shifting provision, seems like it sets up Jones to potentially write a check to the defendants. (Fair use also seems strongly possible, but we don't need to get there if the plaintiff can't establish a prima facie case of infringement).

With respect to the alleged privacy violations, there is the obvious problem that police incident reports should be public documents. However, I’m also interested Jones' faculty bio does much to trumpet his high public profile. He self-describes himself as a "public intellectual" (a fairly rare self-characterization among academics) and says he has "appeared as an expert on national and local television" and "is a sought after speaker at many universities." These self-reported assessments about his public visibility don't obviate his privacy rights, but they do suggest that a police detention--especially one with racial overtones, exactly the type of thing he discusses in these public spaces—and the associated report either don't qualify as a "private fact" or are sufficiently newsworthy to trump his privacy interests.

Ben Sheffner's post on this case makes good points about the false light claim. He says it's DOA because (1) Florida doesn't recognize the cause of action, and (2) to the extent it's based on the cartoon, the cartoon was provided by a third party and therefore 47 USC 230 preempts the claim.

This lawsuit reminded me a little of the long-running Steinbuch v. Cutler lawsuit, which also involved a law professor/plaintiff Robert Steinbuch (now at UALR) claiming privacy violations against a blogger. That legal battle hasn't turned out so well for Steinbuch. Putting aside a number of substantive losses along the way, the lawsuit has been going nearly 5 years with no clear end in sight. Some of the delay was caused by Cutler's bankruptcy, but much more of it was due to the inherent weakness of judicial proceedings as a redress for unwanted speech. And in the end, I don't think the lawsuit has done much to enhance Steinbuch's reputation as a law professor or otherwise.

Two other minor points about the lawsuit. First, the complaint repeatedly criticizes Above the Law for referring to Jones as "D. Marvin Jones" rather than some other variation of his name, alleging that the usage was designed to ensnare searchers looking for his book. Perhaps that was the intent (doubtful, but possible), but I have chosen to refer to Jones by the name he uses on his faculty profile...which is "D. Marvin Jones." Second, it was jarring to see "Barack Obama" misspelled in a complaint (especially given the plaintiff's expertise) as "Barrack Obama."

Unfortunately for Above the Law, Florida does not have a robust anti-SLAPP statute. Nevertheless, given its facial lack of merit and the possibility that Jones will want to minimize the size of the check he has to write the defendants for his ill-conceived copyright claim, I hope this lawsuit will reach a quicker resolution than the Steinbuch v. Cutler saga.

FWIW, there is an attractive free conference tomorrow afternoon in San Francisco that, quite topically, will address the unique challenges of online reporting of legal cases. (The official page is down, but this page has all the relevant details). Hope to see you there.

UPDATE: Jones has voluntarily dismissed the case within days of bringing it.

Posted by Eric at 01:57 PM | Content Regulation , Copyright , Derivative Liability , Publicity/Privacy Rights | TrackBack

October 21, 2009

Domain Names as Property Subject to Creditor Claims--Bosh v. Zavala

[Post by Venkat]

Most people take it for granted that domain names are property. As such, there shouldn't be much dispute that domain names are subject to the claims of judgment creditors. But I've seen enough resistance to this position that I thought a recent case was worth a quick mention. This recent case (Bosh v. Zavala (08-CV-04851-FMC-MANx) (C.D. Cal. Sept. 24, 2009)) also raises some interesting questions about the mechanics of trying to use a domain name to satisfy a judgment. For more perspectives, see Marc Randazza's post on this case here; see also NYT; Domain Name News; Deadspin.

Background: One of the early and often-cited cases for the proposition that a judgment creditor cannot get a domain name is Network Solutions, Inc. v. Umbro Int’l, Inc., 259 Va. 759, 770 (Va. 2000). In Umbro, the Virginia Supreme Court held that "a domain name registrant acquires the contractual right to use a unique domain name for a specified period of time...[but this] contractual right is inextricably bound to the domain name services that [Network Solutions] provides." Umbro concluded that the domain name registration agreement was a "contract for services" (which was not subject to "garnishment") rather than property. (Umbro was preceded by the Eastern District of Virginia's decision in Dorel v. Arel where the court punted on the "issue of whether a domain name is personal property subject to [a lien]" because the judgment creditor could take advantage of an easier, practical solution: "the registrar's policies.")

Kremen v. Cohen: Enter Kremen v. Cohen, decided by the Ninth Circuit in 2003. Kremen cast a shadow over Umbro. Kremen involved an action for conversion where the underlying property was a domain name. One of the big questions in front of the court was whether a domain name was property which could support a claim for conversion. The court pretty definitively answered that a domain name was property and therefore could support a claim for conversion. Following Kremen, courts started to realize that since domain names are property, they should be subject to the claims of judgment creditors. (See Office Depot, Inc. v. Zuccarini, 621 F. Supp. 2d 773 (N.D. Cal. 2007).) More recently, in Bosh, Judge Florence Marie-Cooper of the Central District of California allowed Toronto Raptors basketball player Christopher Bosh to seize a slew of domain names held by Luis Zavala, based on a cybersquatting judgment obtained by Bosh.

The key conceptual question to resolve is whether domain names are freely transferable, or whether domain name registration services are contracts personal to the registrant. Given the emergence of the flourishing secondary domain name market, you would think there would be no dispute as a practical matter as to whether domain names are freely transferrable. But it's not as hard you may think to encounter people who argue that domain names are just personal contract rights. For example, in 2009, Network Solutions took this position in the Kentucky domain name case where the Kentucky AG tried to seize numerous domain names based on the fact that they were "gambling devices" used in contravention of Kentucky law. (See pages 7 through 11 of their amicus brief filed in Kentucky: [pdf].) The Kentucky AG's decision was on questionable legal grounds for a variety of reasons, but I was surprised to see Network Solutions' reliance in its amicus brief on Umbro.

From a practical standpoint, the big question is whether a judgment debtor has assets that can be sold to satisfy a judgment. If there are such assets (whether in the form of domain names or otherwise), most courts are going to find a way to let the judgment creditor get at them. There may be tweaks around whether the particular statute in question covers a certain type of property (see, e.g., Palacio Del Mar Homeowner's Association, Inc. v. McMahon, 174 Cal. App. 4th 1386 (2009) (domain names are not subject to "turnover order," coincidentally, the same type of order Bosh obtained)), but it's a mistake to see these cases as somehow rejecting the theory domain names are properly subject to the claims of creditors. One caveat: even if domain name registration services are not contracts personal to the registrant, not every domain name can be easily bought and sold. As discussed in a moment, certain types of domain names - including potentially those involved in Bosh - are tougher to monetize without stepping on the toes of third parties.

Process Questions: In Bosh, the domain names all related to the names of famous athletes and celebrities and were ordered "turned over" to Bosh. Bosh plans on distributing them to other athletes whose names the defendant was squatting on. (Bosh plays for the Toronto Raptors and the defendant squatted on the names of Bosh and many other athletes.) Bosh is somewhat atypical since Bosh didn't really care about satisfying the judgment he obtained and probably will not undertake further efforts to collect. But one of the problems with Bosh is that it doesn't set any sort of process to value the domain names. Is the defendant's judgment satisfied based on the turnover? Who is to say? A turnover to Bosh is sort of an awkward result, and seemingly precluded by the statute (see McMahon), but Zavala was not around to contest the issues, so it is what it is.

A related problem is that Bosh would have a tough time selling the domain names, given that there would be little guarantee that any purchaser would steer clear of engaging in the same conduct that the defendant did in Bosh. The court in Zuccarini alludes to this. (See Zuccarini, 621 F. Supp. 2d at 778, fn. 7.) It's unlikely a court would ever conclude this, but if Bosh decided to auction off the names that were turned over, would he be treading close to the cybersquatting line?

Back to the typical case. Some would argue there's some sort of non-infringing use for all domain names, and that it's up to the purchaser to figure out non-infringing uses. There are plenty of established auction houses that regularly deal in domain names (e.g., Moniker; Sedo). The best bet is to sell a domain name through a court-blessed third party auction. Theoretically, the market price at an auction will accurately reflect the assessment of purchasers as to how the domain name can be used. I guess a very rough analogy is that real property is freely exchangeable, but you can only use it without injuring the rights of your neighbors. No one argues based on the hypothetical nuisance claims of neighbors that real property is not freely exchangeable and therefore not subject to the rights of creditors.

At the end of the day, there are plenty of issues around the fringes, but domain names are likely not off limits for judgment debtors based on the theory that domain names are not "property". Most courts will find a way to let judgment creditors get at domain names. That's not to say that the process of seizing the names and disposing of them does not raise thorny issues.

Posted by Venkat at 10:02 AM | Domain Names , Licensing/Contracts , Publicity/Privacy Rights , Trademark

October 15, 2009

Q3 2009 Quick Links, Part 2

By Eric Goldman

Trademark

* Venkat: Twitter makes the dictionary.

* Federal Circuit says Hotels.com is generic.

* Steve Madden sues eBay for trademark infringement. Marty's coverage. Justia page. I found the fifth cause of action, "trademark delusion," a surprisingly apt malapropism.

* Yahoo! Inc. v. Ashantiplc Limited. Yahoo is suing over Flicker.com.

* Lots of action involving Mary Kay.

- Mary Kay sued Yahoo for its shortcuts being triggered by the Mary Kay trademark. The Justia page.

- Mary Kay brought another lawsuit to shut down aftermarket resales.

- The Mary Kay v. Weber case has reached a conclusion. See my initial blog post on the case. In March, Mary Kay won a jury verdict against Weber. In August, the district court judge denied Weber post-trial relief. Mary Kay v. Weber, 2009 WL 2569070 (N.D. Tex. Aug. 14, 2009). On Sept. 29, the judge awarded Mary Kay $1.1M, computed as “the defendants' pre-tax net profit for the years 2005 through 2008.”

* I hate greeting card IP cases...especially when they involve Paris Hilton. See the Ninth Circuit opinion.

* Rebecca on a complicated trademark and false advertising case involving cell phone reflashing.

* Third Educ. Group, Inc. v. Phelps, 2009 WL 2029758 (E.D. Wis. July 10, 2009). An oblique nod to a co-blogging situation:

It is possible to have a situation in which a voluntary association develops out of a preexisting creation of an individual (take, for example, a blog created, named, and operated entirely by a single individual that then expands into a voluntary association as it includes more collaborative members but continues to utilize the original name). Under such circumstances, the founding individual might register the name of the voluntary association as a trademark solely in his own name and then license it to the voluntary association because he has used the trademark separate from the voluntary association. However, that did not occur here.

* CollegeSource, Inc. v. AcademyOne, Inc., 2009 WL 2705426 (S.D. Cal. Aug. 24, 2009): "Plaintiff argues for personal jurisdiction on the grounds that Defendant purchased two of Plaintiff's trademarks from internet search engines, so that those engines would display Defendant's advertisements when Plaintiff's word marks were searched….Defendant's uncontroverted affidavit avers that its Adwords were selected by the search engines and were purchased before Defendant knew Plaintiff was located in California.…Accordingly, even if Defendant intentionally infringed Plaintiff's marks, there is no showing that act was “expressly aimed at the forum state” or that it caused “harm that the defendant knows is likely to be suffered in the forum state.”"

* GMA Accessories, Inc. v. BOP, 2009 WL 2634771 (S.D.N.Y. Aug. 25, 2009). A really interesting and confusing lawsuit that says (I think) that electronic usage of third party trademarks does not qualify as a use in commerce and may not constitute contributory trademark infringement, with obvious implications for the search engine keyword advertising cases:

Electric Wonderland's second alleged meritorious defense is that it did not use the CHARLOTTE or CHARLOTTE SOLNICKI marks....Electric Wonderland's President described its business as follows:

Electric Wonderland brokers and/or processes orders from wholesale purchasers for fulfillment by clients of Electric Wonderland. Electric Wonderland does not directly sell its clients [sic] products, does not fulfill orders, does not acquire or maintain any inventory for sale, and does not purchase products from its clients for resale. Electric Wonderland does receive commissions on sales it brokers....

According to the Flack Declaration, these were the services Electric Wonderland provided to Charlotte Solnicki. (Flack Decl. P 3.) "Electric Wonderland did not directly sell Charlotte Solnicki products, did not fulfill orders, did not acquire or maintain any inventory of such products for sale, and did not purchase such products from Charlotte Solnicki for resale." (Flack Decl. P 3.) If this were the extent of Electric Wonderland's role, a fact-finder could find that Electric Wonderland did not "use" the CHARLOTTE or CHARLOTTE SOLNICKI marks, because it did not place the marks on any goods. Likewise, a reasonable fact-finder could determine that Electric Wonderland never used the marks to sell or advertise any of the services Electric Wonderland rendered. Thus, Electric Wonderland would not be liable for direct trademark infringement.

...Electric Wonderland's president claims that "[a]t no time while Charlotte Solnicki was a client of Electric Wonderland was Electric Wonderland aware of GMA's 'Charlotte' products nor of any possibility that the Charlotte Solnicki products were potentially infringing any third party's trademark rights." (Flack Decl. P 5.) If true, a reasonable fact-finder could find that Electric Wonderland neither knew, nor had reason to know of the alleged infringement during the period in question.

In addition, the Second Circuit has not decided whether contributory infringement applies to entities like Electric Wonderland, which provide services instead of products....Thus, Electric Wonderland, as a matter of law, may have a complete defense to contributory infringement liability, a matter which this Court need not decide at this juncture.

* Dan Burk and Brett McDonnell, Trademarks and the Boundaries of the Firm. Interesting discussion (among other things) on how an entrepreneur's/employee's personal reputation and corporate reputation can be interlinked.

Domain Names

* The Eleventh Circuit affirmed the defense win in the domain name case of Southern Grouts & Mortars v. 3M, 2009 WL 2182605 (11th Cir. July 23, 2009). See my initial blog post on the case.

* John Levine: What are TLDs Good For? Bringing to mind the famous Edwin Starr song (I think the answer is the same!).

* ICANN claims it has killed domain name tasting.

Posted by Eric at 09:53 AM | Derivative Liability , Domain Names , E-Commerce , Marketing , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

September 08, 2009

Yahoo's Search Results Snippets Aren't False Endorsement--Stayart v. Yahoo

By Eric Goldman

Stayart v. Yahoo! Inc., 2009 WL 2840478 (E.D. Wis. Aug. 28, 2009)

Earlier this year, I blogged about Beverly Stayart's quixotic lawsuit against Yahoo and others for showing search results snippets that contained her name adjacent to spammy porn and adult content links. Last month, the court efficiently dismissed her federal Lanham Act "false endorsement" claims and then dismissed the remainder of her lawsuit on procedural grounds, allowing Stayart to refile those claims in state court if she chooses. (She shouldn't but she probably will). The court rejected Stayart's Lanham Act false endorsement claim on three different grounds.

Commerciality

The court says that Stayart has not made adequate efforts to commercialize her name sufficient to give her standing for a Lanham Act claim. I agree with the court's factual assessment. Although Stayart alleged that she has been an active participant in online communities, she hasn't done anything to commercialize her name. Stated differently, if Stayart has standing under the Lanham Act's false endorsement provisions, then just about everyone in the world would.

Confusion

The court rejects any likelihood of consumer confusion. I don't particularly like the court's reasoning, which seems to be that since Stayart has lived a squeaky clean life, no one would believe that she could be associated with the seedier activity promoted in the spammy links. This reasoning seems completely inconsistent with the nature of gossip. Nevertheless, the court is completely right when it says "No one who accessed these [spammy] links could reasonably conclude that Bev Stayart endorsed the products at issue." I think this is true because the spammy links lack internal credibility enough for anyone to believe them at all.

With respect to Various, the defendant whose adult website was advertised at some of the spammy links, Stayart argued initial interest confusion because people interested in her might be induced to click on the spammy links. The court rejects the argument by saying "The type of person looking for information about Bev Stayart would not be fooled into using an online adult-oriented dating website." I'm not sure why the court thinks this is true; people have all sorts of “hidden interests.” Nevertheless, I'd like to think no prudent person would be fooled into clicking on spammy porn links in a search engine, even if it referenced Stayart's name.

47 USC 230

The court's discussion up to this point has some odd reasoning, but the 47 USC 230 discussion is quite bizarre. The court's conclusion is that "Yahoo! should be entitled to immunity because it acted as an interactive computer service, even though Stayart’s claims are nominal intellectual property claims....Immunizing Yahoo! from Stayart’s claims would not limit the laws pertaining to intellectual property because Stayart does not state a valid intellectual property claim."

What? Is the court saying that it doesn't need to discuss 230 because Stayart failed to state a valid IP claim, or is the court saying that Yahoo qualifies for the 230 immunity because doing so would be consistent with 230's policies--even if the court has to ignore 230's statutory exclusion for IP claims? The court could have found a role for 230 by concluding that the Lanham Act false endorsement claim wasn't really an IP claim at all, any more than a Lanham Act false advertising claim is an IP claim, but I don't think the court said that.

So I'm not sure what the 230 references means, and I personally think the court would have been better off not discussing 230 at all. (As Rebecca writes, the whole 230 digression was "obviously useless.") At minimum, I don’t think it would be accurate to say that this court found a 230 defense to a federal IP claim. As a result, I’m filing this case in the bucket of “not very interesting” 230 cases.

Note: we already knew that 230 protects search engines from liability for their search results snippets when IP claims aren’t involved. See, e.g., Maughan v. Google and Murawski v. Pataki. A British court also reached the same result on common law grounds. See the Metropolitan International Schools case.

Conclusion

The court denies Various' 230 defense because its association with the banner ad was unclear. Having dismissed the federal Lanham Act claims completely, the court then declines supplemental jurisdiction over the state law claims. The court also rejects Stayart's guffaw-inducing request for sanctions against the defendants for having the temerity of moving to dismiss her complaint.

I'm glad to see Stayart's lawsuit quickly dismissed. It was a ridiculous lawsuit from inception. At the same time, the court's corner-cutting leaves me lamenting the absence of better doctrines to deter junk lawsuits like this in the first place. It's actually can be tricky to say that any trademark complaint is "wrong" given how much doctrinal contortions some courts have indulged in--even when lawsuits like this are so clearly wrong.

More comments on the case: Rebecca Tushnet, Mike Masnick (who has had first-hand dealings with Stayart) and Ars Technica

Posted by Eric at 03:05 PM | Derivative Liability , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

July 07, 2009

June 2009 Quick Links, Part 2

By Eric Goldman

State Regulation of the Internet

* iAWFUL, the Internet Advocates Watchlist for Ugly Laws

* Texas HB 2003. Part of the anti-cyber-harassment mania. Very broad statute with lots of room for prosecutorial mischief.

* BNA (BNA subscription required): "State Legislatures Consider Criminal, Civil Restrictions on Ticket Purchasing Software": "At least six state legislative bodies are considering bills this session that would place restrictions on the use of “ticket bots.""

* Because states are embracing the Amazon affiliate tax, the online affiliate industry is shrinking as we speak (1, 2, 3). But in one of his rare good moves, Schwarzenegger has vetoed CA's attempt to impose the Amazon tax.

* Clive Thompson in Wired: "By severing the link between location and geography, the internet turned everything upside down. Now mobile phones are inverting everything again, in the other direction — because your location becomes most important thing about you. So how is the return of geography going to change our lives?" My previous commentary on geolocation and the law.

Blogs/Social Networking Sites

* Yath v. Fairview Clinic, 2009 WL 1751767 (Minn. App. Ct. June 23, 2009). Posting illegitimately obtained health information to a MySpace page qualified as “publicity” for purposes of an invasion of privacy claim. The court says: “Yath's private information was posted on a public MySpace.com webpage for anyone to view. This Internet communication is materially similar in nature to a newspaper publication or a radio broadcast because upon release it is available to the public at large.” As a result, the publication qualified as “publicity” even if the material was posted for less than 48 hours and the plaintiff could only prove that a small number of folks actually saw it. Compare the Moreno v. Hanford Sentinel case, where republication of information the plaintiff voluntarily published on her MySpace page could not support an invasion of privacy claim.

Nevertheless, the defendants were excused because they had not created the MySpace page, even though they had supplied the information republished on the MySpace page.

* Richerson v. Beckon. Ninth Circuit upheld reassignment of teacher-mentor based on negative blog comments. My blog post on the district court opinion.

* Kaufman v. Islamic Soc. of Arlington, -2009 WL 1815641 (Tex. App. Ct. June 25, 2009). An online-only journalist qualified as a "member of the electronic or print media" for purposes of an interlocutory appeal statute.

* After von Brunn committed his hate crime outside the US Holocaust Museum, a bunch of his digital trails went dark as websites newly realized his vitriol was posted there.

* If you're looking for a paper topic, here's one: the use of MySpace, Facebook and other social networking sites in family law disputes, especially over child custody. I'm seeing cases every week where social networking site postings are being introduced to corroborate or contradict testimony about a parent's fitness.

Security

* FTC v. Pricewert. The FTC takes down an allegedly rogue Internet access provider. To the extent that the IAP is engaged in criminal activities, no problem; but it's less clear to me if the FTC can get a civil injunction under its Sec. 5 authority to stop the IAP from serving its putatively illegal customers. Such an action could be preempted by 47 USC 230. The FTC, in its brief, says the IAP fits into a Roommates.com exception, an argument presumably bolstered by their 10th Circuit win in FTC v. Accusearch.

* Johnson v. Microsoft Corp., 2009 WL 1794400 (W.D. Wash. June 23, 2009). This is a putative class action over Microsoft’s use of Windows Genuine Advantage (WGA) to validate copies of Windows XP. In this ruling, Microsoft gets SJ on the claim alleging that the contract prevented Microsoft from doing WGA validation. Especially interesting is the court’s conclusion that IP addresses are not personally identifiable information.

* Microsoft v. Lam. Microsoft brings a lawsuit against alleged click fraudders who caused Microsoft to issue $1.5M in credits to advertisers. The NYT article.

* EFF on the most recent amendments to the Computer Fraud & Abuse Act.

Miscellaneous

* Expedia tagged for $184M in damages for improperly marking up its service fees.

* In re Jamster Mktg. Litig., 2009 U.S. Dist. LEXIS 43592 (S.D. Cal. May 22, 2009). Wireless carriers aren’t liable under RICO and false advertising laws for various deceptive practices by wireless content providers.

* New unmeritorious patent lawsuit trend: lawsuits over patent markings for expired patents.

* NYT: Investing in Lawsuits, for a Share of the Awards

* Oddee: 15 geekiest license plates:

Posted by Eric at 09:18 PM | Content Regulation , Derivative Liability , E-Commerce , Licensing/Contracts , Marketing , Patents , Privacy/Security , Publicity/Privacy Rights , Search Engines | TrackBack

June 09, 2009

May 2009 Quick Links Part 2

By Eric Goldman

Blogs and Boards

* WSJ: Bloggers, Beware: What You Write Can Get You Sued

* j2 Global Communications v. Zilker Ventures, CV 08-07470 SJO (AJWx) (C.D. Cal. April 22, 2009). A consumer review website can putatively qualify for anti-SLAPP protection, but not in this case because the plaintiff established its prima facie case.

* Biggs Cardosa Associates Inc. v. Bradbury, 2009 WL 1508703 (Cal. App. Ct. May 29, 2009). Here's another one for all of you Rip-off Report fans. A former employee lost a jury trial (and was hit with over $100,000 of damages) for breaching a "non-disparagement" clause in his separation agreement by posting negative comments about his former employer and colleagues on a variety of online fora, including numerous posts on the Rip-off Report.

* Houston Chronicle article on a lawsuit against a website operator for a user post saying that a woman has herpes when she, in fact, does have herpes. She is claiming public disclosure of private facts. [Stupid Houston Chronicle expired the article and moved it to its archives, breaking a number of links throughout the web. Here's a short recap of the article.]

* Stengle v. Office of Dispute Resolution, 2009 WL 1138119 (M.D. Pa. April 27, 2009). The contract of an independent contractor government "hearing officer" was non-renewed because she blogged on the topics of her hearings, raising questions about her impartiality. As the court says in dismissing the resulting lawsuit from the hearing officer:

To reiterate, this Court fully recognizes the cherished right of free speech, as well as the commendable goals of the RA. But these cannot wash away the bona fide concerns that arise when a judicial officer elects to disseminate her opinions in cyberspace with little or no restraint. Because of her position, Plaintiff's attempts to qualify her stances as solely her own were entirely ineffectual. With particular jobs come certain precise responsibilities. In Plaintiff's case, one of these included avoiding even the appearance of bias via extra-judicial comments. Plaintiff's deep concerns about the special education issues and the resulting creation of her blog ultimately caused her to face a dilemma that she alone created. The choices she freely made thereafter led to her non-renewal, and as aforestated we do not find any of the Defendants' conduct actionable under the circumstances.

This case reminded me some of Richerson v. Beckon from last year.

* JuicyCampus redux: People's Dirt. Let the angst over anonymous online forums begin anew.

* Doe v. Ciolli, 2009 WL 1204361 (D. Conn. April 30, 2009). In the AutoAdmit lawsuit, the court rejected Matthew Ryan's (aka ":D") motion to dismiss for lack of jurisdiction.

* Facebook v. Power Ventures, Inc., 2009 WL 1299698 (N.D. Cal. May 11, 2009). Largely following the troublesome Ticketmaster v. RMG case, Power Ventures' motion to dismiss Facebook's copyright and DMCA claims was denied. (Other claims survived too). Comments from Jeff Neuburger and Tom O'Toole.

Miscellaneous

* Colleen Chien, Of Trolls, Davids, Goliaths, and Kings: Narratives and Evidence in the Litigation of High-Tech Patents, North Carolina Law Review, Vol. 87, 2009

* Mazur v. eBay Inc., 2009 WL 1203937 (N.D. Cal. May 5, 2009) Class certification denied. My blog post on this case’s more troubling ruling about 47 USC 230.

* Riggs v. MySpace, Inc., 2009 WL 1203365 (W.D. Pa. May 1, 2009). Venue selection clause in MySpace user agreement upheld.

* Salter v. State, 2009 WL 1409484 (Ind. App. Ct. May 20, 2009). Saving pornographic photos of a minor to a CD does not constitute the "creation" of child porn, even though a new "copy" has been created.

* State v. Bell, 2009 WL 1395857 (Ohio App. Ct. May 18, 2009). MySpace chat sessions aren't MySpace "business records" for hearsay purposes.

* Forbes: the Hidden Costs of Privacy. This article has been written, and written again, many times in the last decade; yet the regulatory dynamics have not improved.

Posted by Eric at 10:35 AM | Content Regulation , Copyright , Derivative Liability , Patents , Privacy/Security , Publicity/Privacy Rights | TrackBack

April 21, 2009

Certain Approval Program v. Rip-off Report Update: Misappropriation Claim Dismissed

By Eric Goldman

Certain Approval Programs, L.L.C. v. XCentric Ventures L.L.C., CV08-1608-PHX-NVW (D. Ariz. April 13, 2009).

Yet another update on Rip-off Report litigation. In March, a ruling in Certain Approval Program v. Xcentric caused a minor stir. The plaintiff sought to amend its complaint against the Rip-off Report to add a claim for "misappropriation of name or likeness." Rip-off Report defended that the new claim was futile due to 47 USC 230. The court allowed the amendment, saying that the complaint had alleged enough facts that Rip-off Report was involved in the requisite activity to overcome 47 USC 230. Based on the plaintiff's allegations in its complaint, this was the correct ruling on a 12(b)(6) motion to dismiss, yet some commentators seemed to think this was a crack in Rip-off Report's litigation armor. I didn't see that ruling as a big deal. Instead, I wrote "This is not the first time that plaintiffs' allegations against Rip-off Report have survived the equivalent of a motion to dismiss, but getting further into the litigation process has proven difficult for plaintiffs."

Indeed, after allowing the claim, the court immediately granted Rip-off Report's 12(b)(6) motion to dismiss, saying that:

While the alleged conduct may or may not be immune from defamation liability, the necessary use of Plaintiffs’ names to identify them fails to state a claim upon which relief can be granted for misappropriation. No one could possibly think that Plaintiffs are somehow endorsing Defendants, and the count adds nothing to Plaintiffs’ defamation claims.

I'd like to think that this may provide a significant new defense against publicity rights claims when websites are making "commercial referential uses" of an individual's name, but a laconic ruling like this isn't likely to have much precedential weight.

Posted by Eric at 02:59 PM | Derivative Liability , Publicity/Privacy Rights | TrackBack

April 09, 2009

Boring v. Google Reconsideration Motion Denied

By Eric Goldman

Boring v. Google Inc., 2009 WL 931181 (W.D. Pa. April 6, 2009)

[I'm not quite sure why so many people are interested in this lawsuit. Maybe it's because of the oddly (and aptly?) named plaintiffs; or because Google is a defendant; or because Google Street View raises some interesting privacy issues. Whatever the case, this reconsideration ruling isn't all that interesting or significant, but I recap it here for completeness.]

You recall the Borings, a Pennsylvania couple that sued Google because Google's Street View captured and published their private driveway. In an opinion that showed zero sympathy for the plaintiffs, the district court judge dismissed the lawsuit back in February. Undeterred by the adverse ruling, the plaintiff asked the judge for reconsideration. Not surprisingly given the tenor of the initial opinion, the judge said no.

The plaintiffs appear to have abandoned their privacy and negligence claims. They asked the judge to reconsider their trespass to real property claim, arguing that a trespass claim does not require damages. The judge agrees with that proposition but rejects the reconsideration on a technicality (the Borings did not plead nominal damages in their complaint). The plaintiffs also asked for reconsideration of their unjust enrichment claim, but the judge rejected that as well because apparently they didn't point to any errors.

As a result, the case remains dismissed. Nevertheless, I suspect we haven't heard the last of this lawsuit.

Posted by Eric at 09:18 AM | Publicity/Privacy Rights , Search Engines | TrackBack

April 04, 2009

Republishing MySpace Post in Local Paper Might Be Intentional Infliction of Emotional Distress--Moreno v. Hanford Sentinel

By Eric Goldman

Moreno v. Hanford Sentinel, Inc., 2009 WL 866795 (Cal. App. Ct. April 2, 2009)

This is one of the most interesting cases I've seen in a while. Moreno was a UC Berkeley undergraduate who grew up in Coalinga, a small town in California's Central Valley whose attractions include a prison, a mental health institution and Harris Ranch, one of the most odoriferous spots on Highway 5. (Coalinga was also the site of a big quake in 1983). After revisiting her hometown, Moreno posted an essay, "An Ode to Coalinga," on her MySpace page. I have not seen the ode, but it was a 700 word essay that started "the older I get, the more I realize how much I despise Coalinga" and then made very negative comments about the town and its residents. Moreno apparently had a change in heart and took the essay down in 6 days. However, while it was posted, the Coalinga high school principal saw the post and submitted it to the Coalinga Record newspaper, which published it as a letter to the editor under Moreno's full name. The community response to the published essay was severe; according to the court, "Appellants received death threats and a shot was fired at the family home, forcing the family to move out of Coalinga. Due to severe losses, [the dad] closed the 20-year-old family business."

Moreno and some of her family members sued a variety of defendants for public disclosure of private facts and intentional infliction of emotional distress. The newspaper defendants were dismissed through an anti-SLAPP motion to strike, leaving the principal and the school district as the defendants.

The privacy invasion claim was easily rejected. Once Moreno posted the essay to an open-to-the-public MySpace page (even if only briefly), it was no longer private. As the court says, "the fact that Cynthia expected a limited audience does not change the above analysis. By posting the article on myspace.com, Cynthia opened the article to the public at large. Her potential audience was vast." It also did not matter that Moreno did not use her last name on her MySpace page; the court says that her identity was readily ascertainable from her MySpace page (which included a photo)..

However, the intentional infliction of emotional distress claim wasn't ready to dismiss. The jury will get to decide if the defendants' conduct was extreme and outrageous. Personally, I would like to know more why the principal did what he did.

Observations about this case:

1) According to this article, the Coalinga Record editor who republished the essay was fired.

2) Although the newspaper publishers fortunately escaped liability on anti-SLAPP grounds, if they had republished the essay only online, it should have been an easy 47 USC 230 win.

3) You know the cliche: never post anything online that you don't want repeated on the front page of the newspaper. Proven true once again.

4) And on that front, I think some folks assume that they can "take back" Internet-published content by taking it down. As this case reinforces, in some circumstances there is no "do-over." As I describe in my talks on blogs and social networking sites, every time I hit the "publish" button, I'm betting my house. In this case, Moreno effectively bet her parents' house and business when she hit the publish button.

5) The court notes that a copyright infringement claim isn't in front of it. I wonder what the publishers' copyright liability analysis would look like. I suspect the copyright damages wouldn't be great, but I still wonder why the claim wasn't apparently brought.

6) This case provides more evidence that community members don't like to see their community disparaged. I'm reminded of the recent James Andrews kerfuffle. Andrews, a PR executive at Ketchum, was on his way to Memphis to make a presentation at FedEx about using social media when he Twittered "True confession but i’m in one of those towns where I scratch my head and say “I would die if I had to live here!”" That didn't go over so well with the FedEx folks following his Twitter account.

7) Nevertheless, I wonder if the violent and ostracizing community response to Moreno's post didn't in fact validate some of her critiques.

More on this case from Law.com and the Central Valley Business Times.

SEPTEMBER 2010 UPDATE: The jury ruled that the principal's conduct was outrageous but did not cause any damages, so Moreno ended up getting nothing. The Fresno Bee posted a copy of Moreno's initial post.

Posted by Eric at 06:47 PM | Content Regulation , Derivative Liability , Publicity/Privacy Rights | TrackBack

March 12, 2009

Rip-off Report Lawsuit Updates: Certain Approval Programs and Ecommerce Innovations

By Eric Goldman

Certain Approval Program v. Xcentric

Certain Approval Programs, L.L.C. v. XCentric Ventures L.L.C., 2009 WL 596582 (D. Ariz. March 9, 2009). I previously blogged about this case in November. This ruling is in response to the plaintiff's request to file an amended complaint, which Rip-off Report resisted on several grounds. Of particular interest is the plaintiff's desire to add a claim for “misappropriation of name or likeness." Rip-off Report responded that such a claim is futile due to 47 USC 230. The court rejected the futility argument at this early procedural stage, saying

Plaintiffs have alleged enough facts regarding Defendants' “creation or development of information provided through the Internet or any other interactive computer service” to make it plausible that Defendants are an “information content provider” for some content and therefore the CDA does not completely immunize Defendants.

This is not the first time that plaintiffs' allegations against Rip-off Report have survived the equivalent of a motion to dismiss, but getting further into the litigation process has proven difficult for plaintiffs.

The court didn't reach the issue, but it's also germane to the futility argument whether a "misappropriation" claim is even preempted by 230 at all or if qualifies as an "intellectual property" claim that is excluded from the immunization. Compare ccBill and Friendfinder.

Ecommerce Innovations v Doe

Ecommerce Innovations, L.L.C. v. Does 1-10, No. MC-08-93 (D. Ariz. Feb. 10, 2009). Thanks to Jeff Neuburger for calling attention to this case. In this case, a defamation plaintiff is seeking identifying information for an anonymous Rip-off Report contributor. The Rip-off Report initially fought the request, but the district court ordered Rip-off Report to comply because the plaintiff had established a prima facie case. The Rip-off Report responded that it plans to appeal the judge's order to the Ninth Circuit, and the district court has stayed the order pending the appeal (although I can't find any evidence that the appeal has been filed yet). As Jeff points out, an appeal by Rip-off Report may prompt the Ninth Circuit to articulate its standards for when plaintiffs can unmask anonymous defendants; it also could become a backdoor way to gauge the Ninth Circuit's attitude towards Rip-off Report in light of some ambiguous language in the initial Ninth Circuit Roommates.com opinion.

Posted by Eric at 11:54 AM | Content Regulation , Derivative Liability , Privacy/Security , Publicity/Privacy Rights | TrackBack

February 26, 2009

McGeveran on Facebook Beacon and Social Media Marketing

By Eric Goldman

Bill McGeveran, a law professor at University of Minnesota, has posted Disclosure, Endorsement, and Identity in Social Marketing to SSRN. The paper walks through Facebook Beacon and marketers' other efforts to take advantage of online word of mouth through social media. It's a surprisingly complex endeavor to parse the various harms putatively experienced by consumers and applicable legal regulations protecting against those harms, and McGeveran's paper navigates through the morass in a sophisticated but easy-to-read way. Facebook Beacon may be over as a cause celebre, but for reasons that McGeveran explains, online word of mouth marketing will undoubtedly play a big role in our future.

The abstract:

"Social marketing" is among the newest advertising trends now emerging on the internet. Using online social networks such as Facebook or MySpace, marketers can send personalized promotional messages featuring an ordinary customer to that customer's friends. Because they reveal a customer's browsing and buying patterns, and because they feature implied endorsements, the messages raise significant concerns about disclosure of personal matters, information quality, and individuals' ability to control the commercial exploitation of their identity. Yet social marketing falls through the cracks between several different legal paradigms that might allow its regulation-spanning from privacy to trademark and unfair competition to consumer protection to the appropriation tort and rights of publicity. This Article examines potential concerns with social marketing and the various legal responses available. It demonstrates that none of the existing legal paradigms, which all evolved in response to particular problems, addresses the unique new challenges posed by social marketing. Even though policymakers ultimately may choose not to regulate social marketing at all, that decision cannot be made intelligently without first contemplating possible problems and solutions. The Article concludes by suggesting a legal response that draws from existing law and requires only small changes. In doing so, it provides an example for adapting existing law to new technology, and it argues that law should play a more active role in establishing best practices for emerging online trends.

Posted by Eric at 10:16 AM | Marketing , Publicity/Privacy Rights | TrackBack

February 17, 2009

Google Street View Case Dismissed--Boring v. Google

By Eric Goldman

Boring v. Google, Inc., 2:08-cv-00694-ARH (W.D. Pa. Feb. 17, 2009)

You may recall the Boring case from last Spring. A Pennsylvania couple sued because Google's camera car drove up their private driveway and the resulting pictures were posted to Google's Street View. I thought the whole lawsuit was such a silly publicity stunt that I didn't think it was blog-worthy at the time. Apparently I'm not the only person who wasn't impressed with the suit, because the court didn't give the plaintiffs any benefit of the doubt and dismissed the lawsuit handily (without leave to amend).

Some highlights from the discussion:

Intrusion Into Seclusion. The court says that the plaintiffs did not allege facts supporting that the intrusion was substantial and highly offensive. To reinforce the point that perhaps the plaintiffs didn't experience much harm, the court points out that the plaintiffs didn't take advantage of Google's opt out procedure, plus they drew public attention to themselves by suing and by not redacting or suppressing their contact info in the court filings. I was a little troubled by the latter point, which seemed circular to me--plaintiffs bringing intrusion into seclusion lawsuits unavoidably thrust themselves into the public eye, whether they want to do so or not. This is especially true for anyone suing Google. As a result, it's not fair to hold that consequence against plaintiffs. (As an example of the unwanted publicity faced by privacy rights plaintiffs, consider Robert Steinbuch's experience as a plaintiff against Jessica Cutler). The court also skips over the legal nuances regarding why Google should get a free legal pass when it offers an opt out.

Public Disclosure of Private Facts. As with the intrusion into seclusion claim, the court says that the plaintiffs have not shown the disclosures were highly offensive to reasonable people, as evidenced by the fact that other people haven't opted out of Google's Street View. (An interesting argument on a 12b6).

Common Law Negligence. The court says Google didn't have a duty to the Borings, and it isn't willing to manufacture one.

Trespass. The court says that the plaintiffs' emotional damages were not proximately caused by the trespass.

Unjust Enrichment. The court (correctly, IMO) says that this is not an independent cause of action but is just a quasi-contract remedy.

Injunctive Relief. The court says that the plaintiffs failed to plead "a plausible claim for entitlement to injunctive relief." Which, I think, is one way of saying "not interested."

A clean sweep for Google, and the end (absent an appeal) of a silly lawsuit.

Posted by Eric at 04:41 PM | Publicity/Privacy Rights , Search Engines | TrackBack

February 16, 2009

Yahoo/Overture Sued for Search Results Snippets Containing Plaintiff's Name--Stayart v. Yahoo

By Eric Goldman

Stayart v. Yahoo!, 2:2009cv00116 (E.D. Wis. complaint filed Feb. 5, 2009). The Justia page.

Bev Stayart appears to be proud of her accomplishments. As the complaint recounts her credentials, we are informed that she has an MBA in finance, was a VP at an unnamed financial institution, is passionate about animals, participates in an online discussion forum where her "scholarly" posts have generated 17,000 hits in three years, and has written two poems about protecting seals that were published on Danish websites. I'm not quite sure exactly what we are supposed to glean from these facts, but if they are designed to establish that she has had a life-well-lived, then we might extend her some kudos for that. These facts--IMO, much less compellingly--also apparently support her allegation (para. 21) that her name has commercial value because of "her humanitarian endeavors, positive and wholesome image, and the popularity of her scholarly posts on the Internet." If 17,000 hits in three years creates commercial value in the author's name, then the Internet is filled with rock stars!

Perhaps more remarkable is that Bev Stayart claims she is the only "Bev Stayart" and "Beverly Stayart" on the Internet (para. 19), and it appears that she would like to keep it that way. Thus, she is seemingly taking the position that any reference to "Bev Stayart" and "Beverly Stayart" on the Internet must be referring to her and only her. That would be a neat trick if true because it could give her exclusionary power over every Internet reference containing those names, but I would be shocked if there is and has been only one Bev/Beverly Stayart in the entire world.

It's a little unclear from the complaint exactly what's going on to make Bev Stayart unhappy, but it looks like she ran into some cloaked search engine spam pages that referenced her name. For example, she searched for "Beverly Stayart" in Yahoo and got the following search result out of a total of 7 unique search results (surprisingly small number for a person with commercial value in their name):

Pm 10 kb Loading Cialas -- Online Pharmacy

Pm 10kb loading cialas january th, at: pm hi friends i met you

in the tim horton s on bloor st a few Sundays ago I ... on february

bev stayart on march th ...

chitosan-as-a-pharmaceutical-excipient.pills-n-health.cn/...

Incredibly, she then clicked on this search result (whoa!) and was taken to a page on mysharedvideo.com which had her name centered in a darkened movie screen and ultimately played an adult video. Her Norton software went crazy on the page (surprise!), suggesting malware was on the page.

She subsequently tried the same search (in both Yahoo and AltaVista) multiple times and got the same search results each time, which took her to other similar websites that all promoted adult entertainment. She also tried some searches with her name plus an erectile dysfunction drug's brand name and got similar results. Finally, she clicked on the .cn domain name in the search result (bold!) multiple times and was apparently taken to some type of splog pages. The fact that she repeated this search and clicked on the search results many times suggests a rare combination of self-interest and amazing--and undoubtedly unwarranted--confidence in her Norton software.

(Various is a defendant because it showed up as a result in the "related searches" feature of AltaVista and apparently provided spam pages that contain her name in the page title and post-domain URL).

Based on the foregoing, she alleges that Yahoo and Overture's display of the false snippets constituted Lanham Act false endorsement and false designation of origin and violation of Wisconsin's publicity rights statute and common law privacy rights.

There are two obvious problems with the lawsuit against Yahoo and Overture. First, if there is or has been even one other Bev or Beverly Stayart in the world, the plaintiff has a real problem proving that the online references were to her and not the other person. And, with all due respect to Ms. Stayart's lifetime of accomplishments, it would be ridiculous for her to argue that her name is so well-recognized that readers would assume that the references were to her instead of other folks with a common name.

The other major problem is 47 USC 230. Per 230, Yahoo and Overture are not liable for creating snippets of third party content, even if they create a false impression. See, e.g., Maughan v. Google and Murawski v. Pataki. Nevertheless, 230 is not a perfect defense because these claims are close to being "intellectual property claims" that would drop out of 230 coverage in some places. Lanham Act trademark claims are unquestionably IP claims, although I personally think Lanham Act false advertising claims are not. See, e.g., the Kruska case. Even so, irrespective of 230, I think the recent Heartbrand Beef v. Lobel's case suggests that search engines may not be liable for false designation of origin simply by presenting third party content.

Similarly, the WI publicity rights statute might be preempted by 230 even though there is more unanimity that publicity rights are IP; compare ccBill (preempted) and Friendfinder (not preempted). The common law right of privacy claim is almost certainly preempted by 230 in all jurisdictions.

One last tidbit that may help contextualize this case. Bev Stayart appears to be "CFO and Director of Business Development" for Stayart Law Offices, and her co-worker (and family relation?) Gregory A. Stayart is the lawyer in the case. (I had difficulty finding enough info about Gregory or the Stayart Law Offices to clarify the connection; that may have something to do with the fact that Gregory isn't licensed to practice law in Wisconsin). Sorry for the snarkiness, but I guess this is one way for Ms. Stayart to develop a law firm's business, especially in a down market like this.

[A favor: please take a look at the search results for "Stayart Law Offices" and let me know what might explain the widespread redundant distribution of Bev Stayart's resume information at mulitple no-name services. Is this what a typical reputation management campaign produces?]

Posted by Eric at 01:26 PM | Publicity/Privacy Rights , Search Engines | TrackBack

February 06, 2009

2008 Cyberlaw Year-in-Review

By Eric Goldman

It's a sign of my schedule that I'm just now getting to this, and this post will be more pithy than I initially conceived. This post recaps some of the Cyberlaw highlights from last year. Frankly, the two biggest stories of 2008 were the financial markets meltdown and the ascension of President Obama, neither of which have a lot of Cyberlaw angles. In light of those big developments, Cyberlaw in 2008 was comparatively quiet. However, there is still plenty of interesting developments to revisit.

Broad Themes

A few broad themes emerged last year:

* Ludicrous trademark claims. 2008 hardly had a monopoly on dumb trademark claims; those are perennial. But 2008 certainly saw some asinine entries, including putative Cyberlawyer Eric Menhart's claim to own a trademark in the term "Cyberlaw," Jones Day's efforts to claim that a web page referencing its name as the employer of some homebuyers violated its trademark rights, and putative Cyberlawyer John Dozier's claim that if his name is used as anchor text, the link must go to his website or it violates his trademark right.

* This was a good year for expansive readings and applications of user agreements. Some examples:
- the Lori Drew prosecution, where Lori was convicted of violating an agreement that someone else clicked through.
- Jacobsen v. Katzer, where a user of copyrighted material is bound by a contract that he/she never clicked through at all.
- AV v. iParadigms, where kids were not allowed to void a user agreement despite their status as minors (and despite the fact that some of them had no meaningful choice about whether or not to consent).
- JuicyCampus enforcement action, where the New Jersey Attorney General's office tried to treat a negative user behavioral restriction in a user agreement as an affirmative marketing representation that such user behavior would not occur on the site.

* One of the long-standing Cyberlaw memes is that websites must either be passive conduits to avoid liability or active editors to manage their liability, but if a website chooses the latter, the website is liable for any editorial mistakes. That is, if the website edits its site but misses something, it's fully liable for what it missed. This simply isn't true under 47 USC 230, which allows websites to choose to be passive, active or anything in between without varying liability. In the IP context, this passive v. active meme has had more traction, but 2008 saw two solid cases suggesting that if a website tries to police its premises and fails, courts will be sympathetic and excuse any omissions. Example #1: Tiffany v. eBay, where the court gave eBay extra credit for its VeRO program as a basis to excuse any counterfeit goods that slip through. Example #2: Io v. Veoh, where the court was more willing to excuse Veoh because it had undertaken extra policing efforts than was required for the 17 USC 512 safe harbor. Finally, although not an IP case, the court in Cisneros v. Yahoo also lauded search engines for their affirmative efforts to block gambling ads, which the court acknowledged was a hard challenge.

* Despite some adverse rulings early in the year, punctuated by the Ninth Circuit's en banc ruling in Roommates.com, the 47 USC 230 immunization is still extremely robust. We saw a number of expansive and pro-defense rulings per 230 throughout the year, including Craigslist, Doe v. MySpace, Cisneros v. Yahoo and Goddard v. Google. Perhaps more importantly, in the three 230 cases I've seen since Roommates.com that cited to the opinion, all three cited the opinion in ruling for the defense.

* Battles over keyword advertising are hardly over, even though Utah officially backed off its attempt to ban them. The ABA IP Section tried to get into the act, and American Airlines sued Google, settled, and then sued Yahoo.

Top 11 Cyberlaw Developments of 2008

#11: Utah Trademark Protection Act repealed. The Utah Trademark Protection Act had the potential to throw the entire keyword advertising business into turmoil. Instead, now that it's repealed, it just remains as a dramatic reminder of the Utah legislature's incompetence regarding Internet legislation.

# 9 and 10: Fair Housing Council v. Roommates.com and Goddard v. Google. The Roommates.com en banc opinion makes the list based mostly on its potential consequences, not its actual effect. It remains one of the most significant pro-plaintiff incursions into the solidly defense-favorable interpretations of 47 USC 230, but it's so riddled with contradictory and ambiguous language that no one really knows what to do with it. I think Judge Fogel's reading of the case in Goddard v. Google has the potential to become the defining interpretation of the case, and his solidly defense-favorable reading of the precedent in excusing Google for ads placed by its advertisers may only reinforce how little Roommates.com changed the law.

#8: AV v. iParadigms. This case was a terrific win for online fair use enthusiasts because the for-profit commercialization of a database of third party copyrighted works was still deemed fair use. The upholding of the contract against the minors forced to enter into it was also significant. Before this ruling, my assumption is that any plaintiff trying to form a class action lawsuit in the face of an adverse user agreement could always form the class on behalf of any minors who had the right to void the contract. This case seems to shut down that loophole in user agreement protection.

#7: Io v. Veoh. The 17 USC 512(c) safe harbor has been law for over a decade and has produced a couple dozen rulings, but few are cleaner and more decisive for the defense than this one. It was a textbook example of a court rejecting the many different arguments plaintiffs make to kick a defendant out of the safe harbor, and as mentioned before, it was a great validation for Veoh's decision to do more than 512 required.

#6: Jacobsen v. Katzer. From a doctrinal standpoint, this case raises really difficult questions about how a copyright consumer can be bound to terms that he/she never "assented" to. Even so, this case had huge implications because it effectively validated that open source licenses can be binding on licensees, giving much more legal credibility to the entire multi-billion open source software industry. However, an odd footnote: on remand, the district court denied an injunction for the plaintiff, raising more issues about what exactly the plaintiff won at the Federal Circuit.

#5: Tiffany v. eBay. A fantastic validation of eBay's practices against a very serious and sympathetic challenger who had plenty of evidence that counterfeit goods were being sold on eBay's site. The case also shows that courts can grow tired of IP owners simply making up their own rules about how online sites should protect them and then suing the sites for breaching these artificial rules.

#4: Mazur v. eBay. A more scary case to 47 USC 230 defense enthusiasts than the Roommates.com opinion. The court says that eBay isn't protected by 230 for some of the marketing representations it makes, even if those representations are rendered untrue by third parties. While this makes a lot of doctrinal sense, it is also a green light for plaintiffs to mine a website's marketing representations as a way to bypass the otherwise-fatal consequences of 230 on a lawsuit triggered by user behavior or content.

#3: Google Book Search settlement. This makes the list for two independent reasons. First, many folks were hoping the case would establish solid precedent on online fair use, and the settlement ended that hope. Second, the proposed Book Rights Registry has the potential to reshape a number of major industries, including the book publishing business, the book retailing industry and the library industry.

#2: the Lori Drew prosecution. I think this may have been the most polarizing Cyberlaw development of 2008, exposing deep divides in people's appetite for punishing bad conduct online. It's hard to assess the overall implications of her conviction because no one rallied to praise Lori Drew's choices, and her case is still a ways from a final legal outcome. However, the possible implications of the case were so complex that it took a special three part series for me to explore its nuances (1, 2, 3).

#1: Cartoon Network v. CSC (the "Cablevision" case). Boy, the more I think about this case, the more important it becomes. The case upends our assumption that if we see it online, it's fixed, creating a new class of unfixed electronic works. Also, the court treats the users, not the service, as making the requisite copies, which reinforces the possibility that online providers can be just "dumb technology providers" for copyright law purposes and reinvigorates the possible defense that a service provider's copying is just done as a proxy for its users. However, the Supreme Court's ambiguous response to the cert petition--not yes, not no, but a request to the Solicitor General for comments--leaves this decision in a precarious position.

Other Developments of Special Note

47 USC 230

* Doe v. MySpace. The Fifth Circuit soundly rejects the argument that MySpace had an obligation to police its “premises.”

* Craigslist. Judge Easterbrook's language in Doe v. GTE had given plaintiffs some hope that the Seventh Circuit would provide a friendly venue to plaintiffs trying to overcome 47 USC 230. Judge Easterbrook may still love his language (which he quoted extensively in the Craigslist ruling), but his practical and no-nonsense ruling for the defense squelches the hope that the Seventh Circuit will become a plaintiff's haven.

* New Jersey's enforcement action against JuicyCampus. State AG offices HATE 47 USC 230.

Affiliate Liability

* Impulse Media. A jury thumped the FTC's overly expansive views of affiliate liability for spam.

* NY v. Direct Revenue. A state judge emphatically rejected the NY AG's office's expansive views of affiliate liability for adware.

Trademarks/Domain Names

* American Airlines' lawsuits against Google and Yahoo. No one I know fully understands why American Airlines sued Google for selling its trademarks for keyword ads. No one I know understands what concessions Google gave to American Airlines to settle the case. And no one I know understands why American Airlines decided to sue Yahoo after procuring the Google settlement. It's all a big mystery.

* NSI's grabbing of domain names in response to WHOIS queries. Is there any better example of ICANN's failings to police domain name retailers than to have one retailer selling a scarce good grabbing the good exclusively (blocking attempted sales by all other retailers) when a customer merely inquires about it?

* Kentucky's attempted seizure of 141 gambling-related domain names. As I wrote before, "Is a domain name property? Yes. See the Sex.com case. Can a plaintiff seize a domain name pursuant to a favorable judgment? Yes. Is it appropriate for Kentucky to seize domain names for gambling websites available in Kentucky? Of course not, because this would effectuate an extraterritorial reach by curtailing non-Kentucky residents from making possibly legal uses of the domain name."

* Eric Menhart, a lawyer who claims to practice Cyberlaw, doesn't know that Cyberlaw is a generic term.

* New gTLDs. Maybe I should reserve this development for 2009...if it happens.

Others

* McCain complains about 512(c)(3) notices taking down his YouTube videos. Surprise! 512(c)(3) notices are unforgiving. Sen. McCain, now that you've had a first-hand taste of their power, maybe you'd like to revisit the statute to see if it's producing the right incentives?

* FCC's bust of Comcast. The pro-regulatory forces were queued up to pounce on any examples where an IAP violated Net Neutrality principles, and Comcast's chicanery in forging reset packets was impossible for anyone to defend.

* NebuAd's flameout. Behavioral ad targeting is in our future unless regulators stop it. NebuAd won't be the winning provider of targeting services, but legislators will keep trying to regulate it further out of existence nonetheless.

Posted by Eric at 05:50 PM | Adware/Spyware , Copyright , Derivative Liability , Domain Names , E-Commerce , Internet History , Licensing/Contracts , Marketing , Publicity/Privacy Rights , Search Engines , Spam , Trademark | TrackBack

January 20, 2009

Outdated Whois Information Might Lead to False Light Tort--Meyerkord v. Zipatoni

By Eric Goldman

Meyerkord v. The Zipatoni Co., 2008 WL 5455718 (Mo. App. Ct. Dec. 23, 2008)

It's a late entry, but this opinion may be a dark horse candidate for the most bizarre case of 2008.

Meyerkord was a Zipatoni employee and listed as the registrant on domain names at Zipatoni's Register.com account. Meyerkord left in 2003. In 2006, Zipatoni ran an astroturfing viral campaign for Sony to promote the Play Station Portable at the domain alliwantforxmasisapsp.com. A BusinessWeek story on the campaign and the Urban Dictionary entry.

Unfortunately for Sony--and Meyerkord--the campaign did not go well. Bloggers and others got suspicious of the overly colloquial site, unmasked the astroturfing and decided to "out" the people involved. They pulled up the Whois records, saw the outdated information that Meyerkord was the registrant, and mistakenly assumed he was involved in the campaign.

The case doesn't get into the specific treatment of Meyerkord, but it seems logical to assume that he was subject to a blogger firing squad circa 2006, i.e., shoot first and ask questions later (I'd like to think the blogosphere would be a little more circumspect circa 2009, but maybe not). For example, the Consumerist has its own category tag for alliwantforxmasisapsp, and it awarded Sony the "Lucky Golden Shit" award for best "flog" of 2006. In this post, the Consumerist "outs' Meyerkord and calls him a "douchebag" (which, for reasons my aging brain can't comprehend, has become the modern derogatory term of choice) until they modified the post, striking out his name and recanting "he is an innocent bystander in this sordid affair." Oops...a little late for that, don't you think, Consumerist?

In response to this rough justice from the blogosphere, Meyerkord sued Zipatoni for the privacy tort of false light. The lower court dismissed the complaint for failure to state a claim. In this ruling, the appellate court reverses the lower court and remands the case to allow Meyerkord to file an amended complaint if he can allege that Zipatoni acted with actual malice.

While I can see why the court was sympathetic to Meyerkord for being falsely associated with an astroturfing campaign, in my opinion, Zipatoni's real negligence was its failure to keep its domain name records updated FOR THREE YEARS! I feel silly mentioning the obvious and well-known practice pointer that you should keep your Whois records up-to-date; and especially remove any former employees from Whois records. Not only does outdated Whois information pose a major security risk, but it could allow former employees to assert ownership over the domain. Now, keeping them on the record may be tortious to the former employee as well. In any case, for having a former employee listed on its domain names for three years, Zipatoni deserves whatever punishment they get.

One more oddity: alliwantforxmasisapsp.com now is a promotional site for Haagen Dazs ice cream. Huh? I presume Haagen Dazs bought the residual traffic from all of the links bashing the domain, but (1) the association between PSP and Haagen Dazs doesn't make any sense, and (2) I would have thought a big brand like Haagen Dazs wouldn't want the implicit taint of benefiting from an astroturfed website.

Posted by Eric at 07:08 AM | Domain Names , Marketing , Publicity/Privacy Rights | 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

May 07, 2008

April 2008 Quick Links

By Eric Goldman

Anti-Gaming

* Even though Ticketmaster won its lawsuit, Minnesota overreacted to the Hannah Montana ticket crush by banning software to circumvent an online ticket allocation process. See Sec. 609.806. Check out the hyperbole in this press release! What's next? Are legislators going to make SEO a crime?

* Google modified its relevancy algorithm 450 times in 2007. And yet courts still cite to Brookfield for how search engines operate!

* The UK cracks down on shill marketing online. ClickZ: "Under the new [UK] Consumer Protection from Unfair Trading regulations, it will be illegal to "Falsely claim or create the impression that the trader is not acting for purposes relating to his/her trade, business, craft or profession," or to "falsely represent oneself as a consumer."" See also AdAge.

* Speaking of SEO....the latest pathetic attempt to grab a generic term and trademark it? "SEO." Sarah Bird is on the job.

* Do student notes of a professor's lecture constitute copyright infringement? We may find out.

* Atlantic v. Howell. More on the "making available" theory of copyright infringement.

* Sarah Bird on registering copyrights in websites and blogs.

* A for-profit T-shirt listing the names of deceased Iraq soldiers sparks a publicity rights lawsuit.

General

* Bowen v. YouTube, Inc., 2008 WL 1757578 (W.D. Wash. April 15, 2008). The court upheld the forum selection clause in YouTube's user agreement.

* eBay is ending its promotion of third party live auctions. Maybe because of this loss?

* Rebecca blogs on SuccessFactors, Inc. v. Softscape, Inc., 2008 WL 906420 (N.D. Cal.), an odd case involving the Computer Fraud & Abuse Act and an "attack PowerPoint" allegedly sent by a competitor to its prospective customers.

* Kate Kaye writes about the new Internet industry lobby group, the "State Privacy and Security Coalition," designed to fight laws like the Utah Trademark Protection Act.

* Kevin Werbach, The Centripetal Network: How the Internet Holds Itself Together, and the Forces Tearing it Apart, UC Davis Law Review, Forthcoming. An interesting paper applying "network formation" theory to show how the Internet came together as a unified network and how those unifying forces are under constant stress.

Posted by Eric at 08:52 PM | Content Regulation , Copyright , Internet History , Licensing/Contracts , Marketing , Publicity/Privacy Rights , Search Engines , Trademark | TrackBack

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:

Friendfinder

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.

More discussion about this case: CMLP, Rebecca, Jeff Neuburger, John Leonard

e360Insight

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.).

iBrattleboro

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.

Posted by Eric at 10:27 AM | Derivative Liability , Publicity/Privacy Rights , Spam | TrackBack

February 25, 2008

CaféPress Denied 230 Motion to Dismiss--Curran v. Amazon

By Eric Goldman

Curran v. Amazon.com, Inc., 2008 WL 472433 (S.D. W.Va. Feb. 19, 2008)

Erik Curran was a National Guard soldier who served in "a combat zone." For reasons unclear from this opinion, he was photographed by an unspecified photographer, and the photo (or photos) of Curran became widely republished. Erik is now suing numerous defendants for violations of his publicity and privacy rights based on these republications.

CaféPress is a defendant because third party users provided Curran's photos for republication on CaféPress-produced t-shirts. CaféPress asserts a 230 defense.

Superficially, 230 looks possible. The images were provided to CaféPress by third parties, CaféPress is a website, and 230 preempts right of privacy claims. I also think 230 probably bar right of publicity claims; even if the publicity claims are IP claims, they would still be state-based IP claims that should be preempted per ccBill.

Nevertheless, I'm a little confused about CafePress' 230 defense. Even assuming 230 facially applies, it should cover only CaféPress' web-based publications and not the vending of physical goods. (As discussed in the Accusearch case, it's possible that any vending by a merchant of record is outside 230's scope, even when the vended materials are just online data). Thus, CaféPress' shipment of physical space t-shirts with an improper image could be outside 230's scope. Perhaps CaféPress believes (much like Amazon did in the Corbis v. Amazon case) that the physical space sales are made by its users, not CaféPress. I could see a judge buying that argument, but if CaféPress is integrally involved in every aspect of the physical retailing, manufacturing and shipment of the impermissible items, it's not clear CaféPress can avoid liability for the non-cyberspace activities, none of which should be covered by 230. (In this sense, I believe CaféPress provides substantially more services to its third party "merchants" than Amazon provides its zShop merchants that were at issue in the Corbis case).

The court doesn't get into this nuance here. Instead, CaféPress argued that Curran's complaint had not alleged that CaféPress had created or developed the content at issue. The court says this argument is insufficient because "CaféPress relies upon the absence of facts not pled in the complaint and seeks to place the onus on the plaintiff to plead around affirmative defenses, which it need not do." I think the court is wrong about this--many courts have granted the 230 defense on a motion to dismiss based on incomplete allegations--but this may not matter in the end. The court adds that "plaintiff faces an uphill battle given the broad grant of immunity conferred by § 230, as interpreted in the seminal case of [Zeran]." But the denial of the motion to dismiss gives Curran a fishing expedition license and some time to parse through the liability associated with vending physical items.

One other interesting note. Curran also sued Amazon for displaying a book cover (from a third party publisher) that featured Curran without his consent. Amazon defended by citing the Almeida case, which dealt with an identical issue. In Almeida, the court sidestepped Amazon's 230 defense and instead held that Amazon wasn't liable because the book cover display was just incidental to Amazon's sale of the book. This court defers the issue, refusing the motion to dismiss as too early to make that judgment.

UPDATE: Michael Erdman's comments.

Posted by Eric at 10:33 PM | Derivative Liability , Publicity/Privacy Rights | TrackBack

December 10, 2007

Yale Reputation Economies Symposium Recap

By Eric Goldman

Reputation is a hot topic in Cyberlaw circles, so the Yale ISP conference on Reputation Economies in Cyberspace came at a propitious time. Some of my meta-observations from the talks.

1) We lack a uniformly accepted definition of reputation. During the conference, it was clear that most speakers were working with their own idiosyncratic definitions. Without a standardized definition, people can easily talk past each other.

2) Reputational systems are everywhere--FICO scores, letters of recommendation, Google PageRank, product review sites like Epinions, spam filters, employee evaluations, etc. I plan to catalog them in my next big paper. For now, Jonathan Zittrain gave two interesting examples: (1) British pubs are now taking patrons’ fingerprints and publishing a blacklist of rowdy pubgoers to other pubs, and (2) websites allow angry drivers to criticize bad drivers by license plate number.

3) We often treat reputation as a monolithic assessment (good or bad), but it is granular and contextual. Reputation systems need to reflect these nuances, and we’re seeing movement in that direction. For example, eBay is considering more granular feedback scores, which might entail different scores for product description accuracy and shipping speediness. However, increased granularity is subject to the accuracy/simplicity tradeoff—increased complexity improves accuracy but makes it more costly to participate in the system.

To overcome the accuracy/simplicity tradeoff and reduce collection costs, reputational data can be collected automatically. Bill McGeveran compared Facebook’s automatic collection of recommendations through Beacon with ratemyprofessor.com (a site I’ve critiqued before--1, 2, 3), where the communication costs discourage students from providing feedback unless they hold extreme views (i.e., love it/hate it).

Jonathan Zittrain suggested that people should be able to request that some information should not become part of their reputation. He gave robots.txt as an analogy; it is a voluntary standard that web publishers can use to keep content (that might have reputational implications) out of the search engines, which in turn significantly reduces its visibility. Although robots.txt is voluntary, it is widely followed. Jonathan thinks a similar voluntary system might be helpful for reputational data.

4) As noted by several speakers, reputation has economic value that can be converted into cash. For example, spammers have better delivery success—and thus make more money—if they can work with a high-reputation email address that is less likely to be blocked/filtered, and an seller with high feedback commands premium prices for his/her auctions. These payoffs create incentives for “bad guys” to capitalize on undeserved reputation, leading to the hijacking of high-feedback accounts and feedback-inflating activity (such the serial consummation of penny auctions) that can be used for a short but intense burst of fraud.

Bill McGeveran gave Facebook’s Beacon as another example of reputation’s selling power. In that case, Facebook and marketes are engaged in “reputational piggybacking” to get extra credit from the “recommending” user’s validation.

Because reputation has economic payoffs, we are tempted to provide property-like protections for reputation. Trademark law is an example of this in the commercial context. In contrast, with respect to individuals, damaged reputations can have significant non-economic harms that are not well-handled through property systems. Discussions about legal protection for reputations can get confusing when economic protectionism are conflated with these non-economic harms.

5) No reputational system will be perfectly accurate. Any system will have Type I and Type II errors. So how accurate must a reputational system be for it to be credible? We should assess this question by comparing a reputational system’s errors against the errors from alternative systems (or the absence of the system altogether).

A reputational system might be improved through more robust error correction mechanisms. Jonathan Zittrain gave the example of the Google News feature that allows a quoted individual to add comments right below the article. This reminded me a lot of Frank Pasquale’s asterisk proposal.

6) Reputational information is time-sensitive in that more recent reputational information is more useful to assessing reputation. Jonathan Zittrain proposed a concept of “reputational bankruptcy” where "old" information could be permanently suppressed because it is not useful to make future assessments. He analogized this to the time-based degrading of eBay’s feedback score, which segregates transactional information by date (i.e., 1 month, 6 month, all time).

More resources on this topic:
* notes from my talk
* my article on the intersection between online word of mouth and trademark law
* the collection of position papers from the event
* other recaps: the conference wiki, Jenny Ambrozek, James Grimmelmann, Aldon Hynes, Greg Lastowka, Andy Oram, Frank Pasquale (1, 2), Rebecca Tushnet (1, 2, 3, 4), Michael Zimmer

Posted by Eric at 10:27 PM | E-Commerce , Publicity/Privacy Rights , Spam , Trademark | TrackBack

November 26, 2007

The Future of Reputation: Gossip, Rumor, and Privacy on the Internet: Ackerman's Review of Daniel Solove's Newest Book on Privacy and the Internet

My slightly incented [FN1] take on Dan Solove's most recent book: The Future of Reputation: Gossip, Rumor, and Privacy on the Internet.

by Ethan Ackerman

Unfortunately, I have to advise against beginning to read this book late on a Friday night on a crowded subway car full of antics-heavy party-goers if you also have a cellphone camera in your pocket. Why? It's not the locale or the company, as Dan Solove begins his compelling second exploration of privacy on a crowded subway too - on the freshly dog-poop-messed floor of a Korean subway car, to be exact. No, it's because readers that are most of the way through the book can appreciate the situation's potential much better. Fortunately for my fellow Friday night riders (especially the guy who kept trying to play the jug on an empty bottle of malt liquor) I was already into Chapter Six that night. More than 130 pages in, I'd already heard tales of funnier, sadder, and more embarrassing moments recorded for public posterity. More importantly, I'd also been exposed to a significant chunk of Solove's excellent thinking on the nuanced impact on individual privacy that comes from a massively participatory Internet - where everyone can be a content contributor, where anonymity and obscurity are likely fleeting but consequences may be lifelong, and where many users' expectations and norms are still trying to adapt to previous technologies like cameras and newsprint.

It is this aspect of Solove's book - the deep AND wide thinking about an individual's interaction with the modern Internet - that moves the book out of the one-point-rigorous-analysis of an academic article and the semi-random anecdotal topicality of a blog post and into the category of critical (in the must-read sense) literature. Where Solove's previous work tackled the pressing but somewhat solve-able problems that arose from individuals losing control of their personal information to government and commercial entities, this book tackles individuals' loss of access and control of their information at the hands of other individuals - and, increasingly, by their own hand on blogs, social networking and image sharing sites of their own.

As Solove points out, this book is much more ambiguous and less proscriptive in its conclusions than his prior work. Reading the book is the best way to understand why Solove doesn't just say "do more 'x'," or "make 'y' illegal on the Internet," or "tech people about how to do 'z'," but Solove's reasoned reluctance to throw out lots of solutions (and the nuance of the few ideas he does suggest) seem to be the main sticking point with reviewers so far. While having my own suspicions and opinions on what might and might not (and what definitely does and does not) work about modern privacy protections, I have to agree with Solove on one of his main premises - it is equal parts impossible and vital to avoid over-censorship or under-protection when trying to simultaneously protect individual autonomy, speech and privacy. I'd have to agree with what I think Solove's ultimate aim is here - informing people and getting them to think more about privacy themselves. To put words in Solove's mouth, if everyone is more informed and thinks about these issues themselves, not only will any ultimate solutions probably be better, but they will also perhaps be moot, as more people will have chosen the non-problematic action in the first place.

Chapter Three may prove particularly interesting for some of the marketing and economics-analysis readers of this blog. Despite the fact that it looks like a well-written lay discussion of just what makes communication different on the Internet (it even innocently starts out with anecdotes about the Washingtonienne scandal), Chapter Three is an excellent stealth lesson in communications theory, information theory, and even an economics lesson about reducing transactions costs and capturing the benefits and harms of previous externalities. Solove could have titled this chapter "the long tail phenomenon of online talk." Though the chapter never says so in so many words, it discusses the impact of markedly reduced transaction costs of sharing AND recalling information. It uses network theory to explain how the connectedness of an information sharer still largely dictates information flow, and it also explores how the Internet has increased both the positive and negative externalities associated with information exchange.

My biggest beef is with a topic that pops up only briefly, once at the end of Chapter Two and again briefly in the conclusion: what might the future of privacy look like? More specifically, where are important trends taking us and in what ways may we consider privacy that we don't now? Solove's work dedicates page after page to the values and desires and social benefits that form our notions of privacy, and equally numerous pages to developments that alter and possibly enhance or diminish our privacy. But how about at least exploring alternate visions of what that may look like as time progresses? (Talk about reviewers wanting to have their cake and have it fed to them too.) The last two paragraphs of Chapter Two tease the reader with the idea that privacy may not even matter to future generations, a plausible idea that finds much support in the preceding pages. Yet, this meme is basically dropped until a brief resurrection in Chapter Eight, where it serves (in "Do people want privacy anymore") as a foil for Solove's convincing later argument that yes, people want privacy and they have a nuanced, non-binary view of privacy that changes, but does not necessarily diminish, with each technological change. How about a few pages on that dys/u-topian future where privacy doesn't matter - the utopian one where social acceptance and factual accuracy negate any need to 'hide' embarrassing facts and early learning mistakes, or the dystopian one where our warts and peccadilloes are now universally surveilled and broadcast, but still have sanctions and social stigmas associated with them?

[FN1] If there is only one thing for an author worse than a poor book review, it is probably no book reviews. While this problem wouldn't apply to The Future of Reputation, Dan Solove did a rather innovative thing to insure against it anyway. He offered free review copies to any mainstream blogger who would author a review, regardless of content. This review is in response to that generous offer.

Posted by Ethan Ackerman at 11:17 AM | Publicity/Privacy Rights | TrackBack

November 21, 2007

Search Redirection Tool Could Be Trespass to Chattels--Burgess v. EForce

By Eric Goldman

Burgess v. EForce Media, Inc., 2007 WL 3355369 (W.D.N.C. Nov. 9, 2007)

Every now and then a consumer goes on a me-vs.-the-world bender and decides to unilaterally save society by suing everyone in sight. Burgess' anger over unwanted advertising may have sparked such a campaign. His previous appearance on the blog involved his pro se lawsuit against American Express and many other major brand names for unwanted pop-up ads. In that ruling, the court intimated that advertisers could be liable for contributory trespass to chattels.

In this companion action, Burgess sued a number of defendants for spam. The court rejects his CAN-SPAM claim for lack of standing (he doesn't qualify for the limited private causes of action).

Burgess also sued for the installation of search redirection client software, claiming it was a privacy invasion, trespass to chattels, and "illegal conduct." The defendants first tries to dismiss the claims as preempted by CAN-SPAM, but CAN-SPAM's preemption clause does not apply to generally applicable laws like privacy invasions and trespass to chattels. Nevertheless, the magistrate report (approved by the judge) dismisses the privacy invasion claim for failure to state a claim, saying:

While the undersigned shares in plaintiff's frustration with the internet and the unconscionable applications that interfere with one's use and enjoyment of technology--and at times display offensive websites--frustration of purpose is not an invasion of privacy. Further, the undersigned cannot find any North Carolina case recognizing a cause of action for invasion of privacy based on computer viruses that redirect internet searches or inquiries, or any cases that would suggest that similar such conduct in other fields would support such a claim.

The "illegal conduct" claim was also dismissed.

On the other hand, building on Burgess prior ruling in state court, this court refuses to dismiss the trespass to chattels claim. Citing to Sotelo and others, the court says that Burgess' "pro se pleadings are not a model of clarity but nevertheless suffice to state a claim for trespass to chattels. He sufficiently alleges actual possession of his computer and 'unauthorized, unlawful interference' with his use of this personal property." So the Sotelo precedent marches on, even though this court (as with the prior Burgess court) doesn't acknowledge Hamidi, Mummagraphics or the other cases that would put these expansive trespass to chattels rulings in serious doubt.

As a result, Burgess' case lives to see another day. I'm sure we haven't heard the last from him!

Posted by Eric at 02:32 PM | Adware/Spyware , Publicity/Privacy Rights , Search Engines , Spam , Trespass to Chattels | TrackBack

October 28, 2007

Blogger Wins Lawsuit Over Gripe Post--BidZirk v. Smith

By Eric Goldman

BidZirk, LLC v. Smith, 2007 WL 3119445 (D.S.C. Oct. 22, 2007)

I have previously blogged about BidZirk v. Smith, a flagship example of how a pernicious and misguided plaintiff with a thin skin can ruin a blogger's life. Fortunately, even though the blogger handled the case pro se, the court saw the case's lack of merit and finally ended the case.

The case started when Smith blogged a lengthy post on his negative experiences with BidZirk, an eBay drop-off company. BidZirk struck back with a lawsuit claiming defamation, privacy invasion and trademark violations. After losing its request for a preliminary injunction, BidZirk appealed to the Fourth Circuit, which denied its request. Very messy discovery followed, with both parties getting chastised for their conduct. Finally, in this ruling, the court granted Smith summary judgment, and threw in some sanctions against plaintiffs' counsel to boot.

Specifically, the court said:

* calling BidZirk's founder a "yes man" was an opinion and therefore not actionable as defamation
* South Carolina doesn't recognize the false light invasion, and even if it did, nothing portrayed the plaintiffs in a false light. Further, linking to a photo published on a third party website does not constitute a publicity rights violation
* Smith was immune from trademark claims because his reference to BidZirk was in the context of news reporting or news commentary. Though the court doesn't equate bloggers and journalists generally, it gives Smith the same protection given to journalists
* BidZirk's attorney filed a lis pendens on Smith's condo, and the court sanctioned the attorney $1,000 because the attorney had no basis to claim a right against Smith's property

As a result, BidZirk's lawsuit should be over unless it makes the unwise choice to appeal to the Fourth Circuit (a distinct possibility given its past practices). But the really unfortunate part is that the court signalled that its disinclination to support the plaintiff's claims very early in the lawsuit. A rational plaintiff would have taken the hint then. Instead, the plaintiff wasted everyone's time, money and emotional energy pursuing a fruitless case.

Meanwhile, I'm not clear what, if any, of Smith's counterclaims are still outstanding. Perhaps Smith will get some additional remedy beyond the moral vindication and $1,000 in sanctions. But even if he does, there really is no way to correct the fact that the plaintiff consumed the last year and a half of Smith's life, forcing him to defend a lawsuit that was ridiculous and ill-conceived from the outset. (The court declined to award Rule 11 sanctions, saying it was a close call).

As the court says, "In essence, this is a case in which the Plaintiffs have sued Smith because he published articles on the internet critical of the Plaintiffs' business." Thus, on the surface, this appears to a cautionary tale to all bloggers that we live in peril of being dragged into court whenever we negatively critique businesses. Yet I see this ruling as a redemption of sorts--it takes a lot of courage to blog, and it takes even more courage for bloggers to stand behind their words when challenged, but we have a responsibility to make sure we can't be bullied on either front. On behalf of bloggers everywhere, we applaud Philip Smith's courage and determination to defeat this case.

UPDATE: Comments from the defendant himself, Philip Smith, as well as Sam Bayard.

Posted by Eric at 10:57 AM | Publicity/Privacy Rights , Trademark | TrackBack

October 24, 2007

Interesting Contract Interpretations in Eighth Circuit Fantasy Baseball Case--CBC v. MLB

By Eric Goldman

CBC Distribution and Marketing, Inc., v. Major League Baseball Advanced Media, L.P., No. 06-3357/3358 (8th Cir. Oct. 16, 2007)

You've already heard about this case, which held that MLB's right of publicity claim against a fantasy baseball league provider was barred by the First Amendment. Personally, I found that ruling only mildly interesting. The First Amendment defense to ROP claims is so squirrelly that I have no idea when we'll see it again, so the precedential impact of this ruling is unfortunately low. Instead, the court should have ruled that publishing player statistics in an online commercial database isn't a commercial exploitation (i.e., lacked the requisite "commercial advantage") of any player's publicity rights any more than publishing a book compiling such statistics would be. That would have been a more sensible ruling and would have provided a lot greater certainty for the future.

In any case, I think the discussion about the expired CBC-MLB contract is way more interesting than the right of publicity discussion. The court lays waste to the standard interpretation of at least 2 very commonly used contract provisions, and this provides a cautionary tale to drafters.

Representation/Warranty of Authority

The contract said that the licensor "represents and warrants that it has the authority to grant the rights licensed herein." Normally, this R&W is made as part of a series of ownership R&Ws--typically that the licensor (1) owns its licensed stuff, (2) has the right to grant licenses to the stuff, and (3) use of the licensed stuff won't infringe any third party rights. When these R&Ws are poorly drafted, they can be effectively redundant (i.e., a third party claim of infringement triggers all three R&Ws), but #2 does pick up two additional situations compared to #1: (a) where the licensor owns the stuff but has granted an exclusive license to a third party that would conflict with the newly granted license, and (b) where the licensor itself in-licenses stuff, in which case the R&W tests if the licensor has appropriate sublicensing rights.

Here, the court rejects the licensee's argument that the Players Association (the licensor) breached the R&W because it didn't have good title (because there were no enforceable publicity rights). Instead, the court reads the R&W as an R&W of agency--that is, that the Players Association is the agent of the players.

FWIW, personally, I rarely use R&Ws of ownership. Usually, I handle infringement risks solely through an indemnity. So I would be unlikely to encounter this issue in a contract I drafted. But I have seen this language hundreds of times in other contracts, and I believe the parties have always intended to ascertain the licensor's good title. As a result, this court seems to have completely misread this provision, and its interpretation jeopardizes the interpretation of the language in the many, many other contracts where it appears.

Declaration of Ownership

The court also interprets the language that the Players Association "is the sole and exclusive holder of all right, title and interest" in and to the players' names/statistics. I call this type of provision a declaration of ownership--typically intended to clarify the respective ownership rights between the parties. Personally, I hate these provisions, especially in licenses of public domain data. What does it mean to declare the licensor the "owner" of public domain data? And I've had way too many pointless/fruitless negotiations over the ownership about user data that are unquestionably hindered by the weak grammatical structure of such a declaration.

The Eighth Circuit gives us another reason to hate the declaration of ownership clauses. They say that "quite obviously" the language is an R&W of ownership, which the Players Association breached because, in fact, it didn't have enforceable right of publicity rights. So watch out for those declaration of ownership clauses--they could become an unintended backdoor warranty of ownership!

Enforceability of Post-Termination Restrictions

The MLB contract had provisions waiving a licensee's right to challenge MLB's ownership rights (the no-challenge clause) and restricting post-termination use of the data (the no-use clause). The no-challenge clause isn't that unusual in the trademark license context, but it's extremely aggressive with respect to licenses of public domain data. (I can't recall ever seeing it in a right of publicity license). The no-use provision is very common among licenses of public domain data. Without the clause, immediately after the license, the licensee will have an electronic copy of the data and can exploit it freely without paying for it, thus undermining the licensor's business model.

The district court struck down both clauses on public policy grounds. This was a sensible approach with respect to the no-challenge clause, which has the effect of precluding judicial oversight over dubious claims of ownership. As for the no-use clause, I'm reminded of the Listerine case and the survival of confidentiality restrictions in a trade secret license even after a trade secret has lapsed in the public domain. Normally we tolerate these trade secret restrictions that make the licensee worse off than if the licensee had never signed the contract in the first place. I'm not sure it's a good policy result, but it's well-established as a legal doctrine.

Whenever I did data in-licenses, I would always contractually preserve our post-termination ability to procure replacement data from other sources for this very reason (just like I always include a provision in trade secret licenses/NDAs removing the confidentiality obligations if the trade secret is in the public domain). My guess is that MLB was a real bear about such negotiations, so they probably would have resisted the inclusion of such a provision. But without that provision, there is a risk that the court would enforce the post-termination obligation in a way that effectively made the data licensor a monopoly supplier of the data in the future.

The court sidesteps all of this by finding the declaration of ownership provision was a warranty that the licensor breached and thus released CBC from the reciprocal obligations. This sure seems like a roundabout way to reach the result that CBC isn't contractually restricted from using public domain data. It would have been cleaner if the court would have categorically restricted such clauses on public policy grounds. Instead, because the court took this convoluted process, licensees of public domain data either have to (a) include sufficient warranties (or clauses that a court will misinterpret as a warranty) that will allow the licensee to escape post-termination restrictions on public domain data, or (b) as I always do, include a post-termination right to obtain the data from other sources, which is usually painful to negotiate.

Posted by Eric at 06:13 PM | Licensing/Contracts , Publicity/Privacy Rights | TrackBack

October 06, 2007

September 2007 Quick Links Part I

By Eric Goldman

Marketing

* From the NYT: There are 200+ auto repair shops in the "Iron Triangle" area in New York, and apparently they compete fiercely with each other, shouting out price quotes as cars needing repairs drive by. But according to one business owner, "Competition is fierce, but we got ground rules here for pulling in customers...For one, you got to stand in front of your own business. You can’t come and stand in front of my shop and steal my customers."

* Cowan v. Hotwire, LASC Case No. BC328621 (Los Angeles Superior Court complaint filed Feb. 10, 2005). I just found out about this case because apparently I'm a potential class member. The gist of the lawsuit is that Hotwire overpromised the hotel quality based on the star ratings assigned to specific hotels. Whether or not this lawsuit is meritorious, it's another reminder that companies need to precisely characterize their rating systems.

* You may recall the lawsuit over James Frey's A Million Little Pieces, a non-fiction story that was a little fictional. The case settled with a class remedy of a refund for book purchasers who went through a fairly complicated process. Care to guess how many purchasers tendered claims? Try 1,345--meaning about $20,000 of actual cash will go into the hands of "harmed" class members. Transaction costs to award this $20,000 of relief? Lawyers want almost $800,000, plus the costs to communicate with the class were about $335,000--in total, about $56 for every $1 of relief.

* In this article, I discussed how intermediaries would seek to mine a person's various methods of communication as source material for ad targeting (that is, unless the law restricts the intermediaries' ability to mine such data sources). The latest example? Pudding Media, which provides free Internet-based calls for the opportunity to deliver contextually relevant ads triggered by the contents of the phone call.

* The "perfect schwag"? One obvious option that didn't make the list...slinkies!

Intellectual Property

* We usually assume that copyright owners won't license their content to critics seeking to disparage them; hence, fair use is needed to permit such critical secondary uses. But a counterexample from the NYT: Naomi Klein licensed the Canadian "National Post" to display excerpts of her book alongside a critical review. There is some evidence Klein didn't know the hatchet job was coming, but even if she did, would it have been a bad choice on Klein's part? Not necessarily. See this study showing that even a critical New York Times book review lifts sales.

* Chang v. Virgin Mobile USA (D. Tex). See the NYT article on this case. Virgin Mobile allegedly downloaded photos from Flickr to use in an advertising campaign without getting publicity consents from the individuals depicted. This is a lawsuit by one of the depicted individuals. I'm very surprised by this apparent oversight because most ad agencies are thoroughly aware of publicity rights issues. Maybe someone mistakenly thought that Flickr's Creative Commons license extended to publicity rights?

* Freecycle Network, Inc. v. Oey (9th Cir. Sept. 26, 2007). Defendant does not make a trademark "use in commerce" when his actions were not "made to promote any competing service or reap any commercial benefit whatsoever."

* WSJ: "Web-Address Theft Is Everyday Event"

* WSJ: Some franchisors are loosening restrictions on franchisees’ ability to make independent choices.

Posted by Eric at 10:10 PM | Copyright , Domain Names , Marketing , Publicity/Privacy Rights , Trademark | TrackBack

June 20, 2007

The 4th Amendment in your inbox

By Ethan Ackerman

While the 4th Amendment gets litigated more often than, say, the 10th Amendment, it is still rare when a court finds federal law unconstitutional for inadequately protecting a 4th Amendment interest in email's privacy.

Earlier this week, the 6th Circuit in Warshak v. US did just that. Largely agreeing with amici briefs filed by law professors and the Electronic Frontier Foundation, the 6th Circuit ruled that "A [government] seizure of e-mails from an ISP, without either a warrant supported by probable cause, notice to the account holder to render the intrusion the functional equivalent of a subpoena, or a showing that the user maintained no expectation of privacy in the e-mail, amounts to" a 4th Amendment violation - notwithstanding the statutory language.

The case arose out of a wire/mail fraud investigation into Warshak's personal and business activities. Federal agents obtained an order issued under the Stored Communications Act (SCA) directing Warshak's ISP to produce account information and email contents. Importantly, the order found (as the SCA required) that there were "reasonable grounds to believe" the emails were "relevant to a criminal investigation." The order was not, however, a full "probable cause" warrant.

Warshak learned of this surveillance one year later when he received the SCA-required notice letter (270 days after the SCA required it to be sent) saying his emails had been searched. Warshak promptly requested that the government stop searching his email without a warrant or notice, but the government declined to commit to stopping. As a result, Warshak sued, alleging that warrantless searches of email violated his 4th Amendment rights. The District Court and 6th Circuit largely agreed.

Having concluded that the government had mostly complied with the SCA in its searches, both the District Court and the Sixth Circuit nevertheless insisted on a 4th Amendment analysis. They had little trouble concluding that people "maintain a reasonable expectation of privacy in e-mails that are stored with, or sent or received through, a commercial ISP." This is a "well duh" conclusion to most Internet users, but interestingly, relatively few Courts of Appeal have made this Constitutional analysis. Why? It's not due to courts' laziness or aversion to Constitutional holdings, but it reflects that the federal statutes for the most part actually track Constitutional protections. So, arguably, this case reflects a rare circumstance where government searching complied with statutory law, but not the 4th Amendment.

Because the SCA protects some emails, most email cases never reach the 4th Amendment; a case can be decided based on the statute. (This is easier said than done in practice, as the SCA is a dense, detailed and specific statute.) For example, in a recent high-profile example, US v. Councilman, the 4th Amendment was effectively invisible. However, lurking in these cases is whether the 4th Amendment protection requires more than the statutory protections - especially as amendments (like the Patriot Act) have pared back the protections or standards in these statutes.

For more on the court's actual 4th Amendment analysis, read the opinion or this summary. In short, the court had to resolve whether the applicable data was (1) the type routinely disclosed to 3rd parties, in which case there was no 'reasonable expectation of privacy' and a subpoena was sufficient authorization, or (2) the contents of communications fully protected by the 4th Amendment, which requires the government to obtain a probable cause warrant. It concluded the data was the latter.

From this (wholly unbiased, disinterested, dispassionate - honest!) viewer's opinion, this case highlights the weakness of having statutory provisions attempt to protect Constitutional rights. Here, the relevant provisions were produced by political compromise, not an effort to implement the 4th Amendment. The Court of Appeals opinion subtly acknowledges this in its discussion of the Supreme Court's Berger case, pointing out that early wiretap statutes had the exact same inadequate "reasonable grounds to believe" standard that forced the Berger court to similarly overrule those statutes. It's always nice to see a rigorous analysis from an actual user's perspective.

ERIC'S ADDITIONAL COMMENT: Among other things, this case is a sobering reminder of how government actors sometimes zealously pursue their objectives without regard for appropriate safeguards. The Sixth Circuit's opinion is bristling with hostility towards the government's post hoc attempts to justify its behavior. In this respect, we're lucky that the judiciary "has our back," but it's still chilling--and sad--to consider the efforts Warshak had to go through to get very basic and rather obvious protections.

Posted by Ethan Ackerman at 06:52 AM | Publicity/Privacy Rights | TrackBack

June 12, 2007

AutoAdmit Fiasco Turns Into a Lawsuit--Doe v. Ciolli

By Eric Goldman

Doe v. Ciolli, 307CV00909 CFD (D. Conn. complaint filed June 11, 2007)

AutoAdmit is a message board for law students and related groupies. It's a relatively untamed corner of cyberspace. The site owners have espoused a relatively ideological view that they don't remove user posts, which has contributed to a rough-and-tumble site with lots of inappropriate and juvenile postings.

The site has been well-known in legal education circles for a number of years, but it crossed over to widespread national prominence with a Washington Post article in March discussing how some law students had been harmed by posts on AutoAdmit. The article starts out:

She graduated Phi Beta Kappa, has published in top legal journals and completed internships at leading institutions in her field. So when the Yale law student interviewed with 16 firms for a job this summer, she was concerned that she had only four call-backs. She was stunned when she had zero offers.

The article then points the finger at AutoAdmit, blaming it for her lack of job market success.

Things generally have gone downhill from there, contributing to the relatively unusual situation where one of the site operators had his law firm job offer revoked. But now the heat has been turned up even higher with a lawsuit against a number of the posters to the AutoAdmit site. This is a very messy situation, so let me try to offer some (I hope) relatively innocuous observations:

1) I suspect the law students whose aliases were named in the complaint had that sickening stomach-liquefying feeling when they realized they were being sued. Being sued is an expensive and scary process.

2) The facts aren't entirely clear, but I believe the plaintiffs aren't trying to hold defendants liable for postings they didn't make. Of course, 47 USC 230 would likely bar most/all of such claims (although after Roommates.com, who knows how far 230 goes?), so it appears that the plaintiffs are wisely steering away from that trap.

3) I think the plaintiffs face some very significant causation issues here, at least with respect to the defamation claims that aren't per se libelous. For example, the plaintiff with 16 interviews and zero offers will have to connect the dots to show the online postings caused or contributed to this result. This doesn't sound very easy at all, and it creates the opportunity for the defendants to pick over the plaintiff's life and qualifications with a fine-tooth comb to show that there were other explanations for her lack of success. In all likelihood, this means more embarrassing revelations for the plaintiff; compare the public disclosures that Robert Steinbuch faced by bringing his lawsuit against Jessica Cutler.

4) I wonder if the judge will consider the message board's wide-open and infantile nature when evaluating the postings. Some of the postings cited in the complaint were, in context, so over-the-top that I can't imagine any reader giving them serious credibility. For an analogous circumstance where the judge recognized the contextual silliness of some remarks, see DiMeo v. Max.

5) This lawsuit could be very divisive in the legal education community. In one corner, free speech and personal/professional autonomy; in the other corner, intolerance for harassing and discriminatory behavior (especially by professional school students, like law students) that can seriously harm the professional opportunities and personal enjoyment of other students. These conflicting norms aren't new, but they tend to divide groups into camps that have a hard time finding a middle ground.

6) Although the defamation and related claims will get most of the attention, the copyright claim seems more pernicious--the postings might be covered by fair use [update: see Rebecca's take], but otherwise the defenses against copyright infringement are narrower and less squishy than the defenses against the other personality harm claims.

HT: WSJ Law Blog.

UPDATE: Eugene has a number of interesting observations.

UPDATE 2: David Lat recaps and summarizes the discussion.

Posted by Eric at 11:57 AM | Content Regulation , Copyright , Derivative Liability , Publicity/Privacy Rights | TrackBack

June 02, 2007

Steinbuch v. Culter Update: Cox Out, Cutler Bankrupt

By Eric Goldman

Two updates in the always-interesting Steinbuch v. Cutler case.

1) Steinbuch v. Cutler, No. 05-970 (D.D.C. May 16, 2007). Ana Marie Cox, the Wonkette blogger--who was brought into the suit merely for linking to the allegedly tortious blog--was dismissed from the case on statute of limitation grounds.

2) Jessica Cutler has filed for bankruptcy. Not only has this resulted in a stay of the case, but after chasing Cutler in court for the past 2 years, Steinbuch apparently is going to learn first-hand the meaning of the term "judgment-proof defendant." The full text of the minute order:

MINUTE ORDER: In view of Defendant Jessica Cutler's notice of her Chapter 7 bankruptcy petition filing in the United States Bankruptcy Court in the Northern District of New York, this case is automatically STAYED pursuant to 11 U.S.C. Section 362. Signed by Judge Paul L. Friedman on 6/1/2007. (mm)

Posted by Eric at 02:31 PM | Derivative Liability , Publicity/Privacy Rights | TrackBack

April 18, 2007

Judge Kozinski Talks About Cyberlaw

By Eric Goldman

Last October, Judge Alex Kozinski of the Ninth Circuit chatted with me in my Cyberspace Law course for 75 minutes. If you listen to the recording, you'll hear Judge Kozinski's humorous thoughts on receiving gifts when he speaks (he auctions them on eBay), selling on eBay (he's very proud of his feedback rating), blogging (he hates bloggers--told me that right to my face at breakfast after I told him I was a blogger) and being a judicial male "superhottie," as well as a less spirited discussion about the law of virtual worlds and the Sex.com case (it's hard to pin down sitting judges on substantive legal doctrines). Hope you enjoy the interview.

Posted by Eric at 04:05 PM | Domain Names , Publicity/Privacy Rights , Virtual Worlds | TrackBack

March 01, 2007

February 2007 Quick Links

By Eric Goldman

* The California Highway Patrol (which, for reasons unclear to me, has investigatory power here) has concluded that the Angelides campaign did not break any laws when they reverse-guessed URLs on Schwarzenegger's website and found an unrestricted page with a video of the Gov wondering about Assemblywoman Bonnie Garcia's "hot'' temperament because of her mixture of "black blood'' and "Latino blood'' and referring to Assembly Republicans as a "wild bunch." The CHP did recommend that Schwarzenegger's team tighten up their website security. Silly reminder: if you really want keep information a secret, don't put it on a website without password protection.

UPDATE: Greg Haverkamp points me to this document, which explains that the CHP has enforcement power over Penal Code 502 violations involving state computers. Interesting. In my mind, I see Erik Estrada revving up his PowerBook to bust some baddies...

* Voda v. Cordis Corp., 2007 WL 269431 (Fed. Cir. Feb. 1, 2007). Patent owner can't litigate infringement of foreign patent rights in US court as part of supplemental jurisdiction over a US patent infringement claim. Patry's writeup.

* NYT on how YouTube indirectly motivates teens to deliberately do stupid things just for the opportunity to post them and perhaps get notoriety. I had a first-hand observation of this when I trolled through YouTube looking for a Listerine commercial that I might show in class while teaching a case involving Listerine. A search for the word "Listerine" in YouTube produces video after video of people doing stupid things with Listerine, like eating big stacks of their breath film or snorting the breath spray and then writhing in pain. Watching video after video of people repetitively doing stupid stunts, I felt like shouting to these people: "IF YOU'RE GOING TO DO SOMETHING STUPID ON YOUTUBE, AT LEAST BE ORIGINAL!"

* From Steve Bryant at eWeek: Shannon Stovall sues Yahoo for including her photo in Yahoo's welcome email, claiming Yahoo violated her rights of publicity/privacy to the tune of $10M compensatory damages and $10M punitive damages.

* Digg users may mark content they don't agree with as "spam." The most recent example is Danny Sullivan's post on SEO, which got Dugg and then was eliminated when anti-SEO Digg users flagged it as spam. If a website defers content grading to its users, it has to trust that they are reporting their feedback accurately. If they aren't, the whole user grading process breaks down. And speaking of breakdowns, there is an active secondary market for Digg votes--check out how Annalee Newitz bought front page placement on Digg for about $100.

* The always-colorful Chris Hoofnagle has released a new paper, "The Denialists' Deck of Cards: An Illustrated Taxonomy of Rhetoric Used to Frustrate Consumer Protection Efforts." By his standards, I suspect I've dealt a full house with some of my rhetoric! Now, I wonder if he's going to create a complementary deck for bogus rhetorical tactics used by consumer protection "advocates"?

* From the EFF: "Debbie Foster, a single mom who was improperly sued by the RIAA back in 2004 for file sharing, has won back her attorneys' fees." Capitol Records v. Foster, No. 04-1569-W (W.D. Okla. Feb. 6, 2007). Unfortunately, that hasn't stopped the plaintiff from advancing nonsense arguments in the case, including the specious argument that a computer owner is automatically responsible if third parties use the computer to infringe copyrights. Fred at the EFF rightly debunks this argument.

* Wikipedia article: "Wikipedia is Failing." Your perspective about success or failure may be influenced by the impressive traffic gains that Wikipedia is experiencing--Wikipedia is now one of the top 10 most trafficked websites. Most of that traffic is coming from Google.

* Doe v. Josef Silney & Assoc., No 07-04167CA15 (Fla. Cir. Ct. complaint dated Feb., 13, 2007). Golfer Fuzzy Zoeller sues an alleged vandal of his Wikipedia page for defamation and related torts. Fortunately, he left Wikipedia out of the suit. However, he only knows the IP address of the person who modified the page, and that IP address is registered to the defendant. Is owning the IP address enough to establish liability? Or is this like an RIAA blunderbuss sue-first, ask-questions-later approach? It seems like the lawsuit should have been against a Doe, with a subpoena to find out who actually edited the page using that IP address.

* US v. Twombly, 2007 U.S. Dist. Lexis 12664 (S.D. Cal. Feb. 22, 2007). A spammer challenges some criminal provisions of CAN-SPAM as vague and overbroad, but the judge has no problems reading the statute to facilitate sending spammers to the slammer. Venkat's writeup.

* CDT groks (and mostly bashes) a variety of online kid-protection bills proposed in Congress.

* From the NYT: Nancy Pelosi posted some videos from C-SPAN to her blog. The Republicans immediately attack her for "pirating" the videos. Turns out that those videos were actually recorded by the government, so they are in the public domain. Whoops! The Republicans had to issue a mea culpa retraction. However, Nancy did grab a C-SPAN-owned video elsewhere which she had to take down. If our legislative leaders can't figure out what video they can recycle, how in the world can less-trained lay people do so? Patry has more.

* A bearish view on domain name speculation from CircleID. I share the sentiment that domain names don't matter, so domaining and typosquatting strike me as a short-term arbitrage opportunity that inevitably will be mooted by a variety of forces. Thus, the idea of paying 40 or 60 years worth of revenue for a domain name is laugh-out-loud funny to me.

* The Long Tail notes that some brands, trying to build a more esoteric image, try to hide their ownership by mainstream mass-market brands, a phenomenon he calls "brand dis-synergy." Examples: Dagoba Organic Chocolate, Joseph Schmidt, Cacao Reserve and Scharffen Berger chocolates (all owned by Hershey) and Converse (owned by Nike).

* Veritas busted for manufacturing revenues via round-tripping with AOL (Veritas bought AOL ads and AOL bought Veritas software; each at inflated prices).

* What does "or" mean? According to the 8th Circuit, it can mean "and." Ken Adams is on the case.

* Ricky Hoggard Holman, a 18 year old high schooler in Sudbury, Canada, correctly blogged all 24 of the American Idol finalists. How? Online research, such as researching the MySpace pages of contestants and emailing their MySpace friends. He also talked to some of the booted final 40 contestants, a few of whom broke their punitive-laden confidentiality agreement to dish some dirt. Maybe he wasn't studying, but clearly he's learned a few things about the power of good old-fashioned research. (The article says he's a straight A student, so he clearly can balance many things). Nice job, Ricky!

Posted by Eric at 12:03 PM | Content Regulation , Copyright , Derivative Liability , Domain Names , Licensing/Contracts , Marketing , Patents , Privacy/Security , Publicity/Privacy Rights , Search Engines , Spam , Trademark | TrackBack

February 18, 2007

Steinbuch's Second Battlefront Against Cutler Shut Down

By Eric Goldman

Steinbuch v. Cutler, 2007 WL 486626 (E.D. Ark. Feb. 7, 2007)

Everyone's favorite blog law case, Steinbuch v. Cutler, spilled over to a second front. While the lawsuit over Cutler's blog posts continues in DC, Steinbuch initiated a lawsuit against Cutler and her publishers over the publication of her book, The Washingtonienne. Steinbuch has moved to Arkansas to take a law faculty position, so to make everyone else's life difficult, he sued for privacy violations in a federal court in Arkansas.

In this ruling, the court has little difficulty dismissing the claims for lack of jurisdiction. No one other than Steinbuch is located in Arkansas, and Steinbuch moved there after the publication date (thus, under the single publication rule, the continuing publication in Arkansas doesn't count for specific jurisdiction). Hyperion, the book's publisher, didn't make a marketing push in Arkansas, and sales--both by Hyperion and by Cutler from her website--have been anemic (see below), i.e., consistent with Asahi stream of commerce. HBO has optioned the book for a possible TV series, but they haven't committed any privacy violations yet. Plus, in all cases, the book is fictionalized, so it's not entirely clear that any Arkansan would recognize the book as a privacy violation. Finally, the corporate parents of Hyperion and HBO are too attenuated from this lawsuit simply by owning another defendant.

As a result, the court says what everyone knew all along--that the proper venue for this lawsuit is DC, where the blog-related litigation is ongoing and where all of the witnesses are located.

While this is yet another embarrassing judicial development for Steinbuch (this time, the embarrassment is seeing a law professor's motion being so soundly thumped), it's also embarrassing for Cutler and Hyperion that very few people are buying Cutler's book. As part of showing that they are not doing business in Arkansas, Cutler and Hyperion sheepishly admit that there haven't been a whole lot of sales. According to the opinion, "at least four copies of the book have been purchased here, forty-six copies were sold to retail or wholesale accounts, and two books were purchased from the internet....Arkansas has not proved to be a lucrative market for Cutler's book, and the evidence shows that the book's minimal distribution is diminishing." Let's see, 52 copies at an MSRP of $24 = less than $1,250 of gross revenue from the entire state of Arkansas. Ouch!

I'm also intrigued that HBO is thinking about developing the book into a TV series. Maybe they will call it "Sex in DCity"?

Posted by Eric at 12:50 PM | Publicity/Privacy Rights | TrackBack

November 21, 2006

Griping Blog Post Leads to Lawsuit--BidZirk v. Smith

By Eric Goldman

BidZirk, LLC v. Smith, 2006 WL 3242333 (D.S.C. Nov. 7, 2006)

Despite all of the hype about blog law, the reality is that we've had comparatively few blog-specific lawsuits. As a result, we give extra attention to the early disputes (like this one) as possible predictors of what's to come.

This case involves a classic griping blog post. The author, Smith, runs a blog called Fix Your Thinking, which purports to cover "editorial news & news commentary covering eBay & Apple drama." On Dec. 31, 2005, he ran a lengthy post entitled "Special Report: You Gotta Be Berserk To Use An eBay Listing Company! The Whole Story " In this post, he relates his unfavorable experiences with BidZirk, one of the many companies that help people resell goods on eBay. As part of this post, he used BidZirk's logos several times.

In response to this gripe post, BidZirk sued Smith for Lanham Act violations, defamation and invasion of privacy. Smith fought back with unspecified counterclaims. At a March 16 hearing, Smith promised to remove all but one of BidZirk's logos. On April 10, the judge denied BidZirk's motion for a preliminary injunction because Smith's use of the trademarks was for news reporting and commentary (which isn't actionable under trademark law). BidZirk has appealed the denial of the preliminary injunction to the Fourth Circuit Court of Appeals.

In the Nov. 7 ruling, the judge evaluates BidZirk's motion to dismiss Smith's counterclaims for lack of federal subject matter jurisdiction. Smith's counterclaims relate to his experiences with BidZirk and their dealings in litigation, neither of which the court felt were close enough to BidZirk's claims over the blog post to mandate consolidation, and there was insufficient basis to support federal jurisdiction otherwise. Presumably, Smith can reflie his claims against BidZirk in an appropriate state court.

Putting aside the procedural technicalities, I'm still stuck on why the plaintiff brought this lawsuit in the first place. Smith posted a very idiosyncratic story to a relatively low-profile blog about a small eBay reseller with 3 storefronts in South Carolina. As a result, I assume that very few people would notice the post, let alone be influenced by it. The lawsuit just escalate the attention paid to the post. Meanwhile, I haven't been able to work through all of the facts, but on its face the trademark claim appears pretty bogus, and the defamation and invasion of privacy claims could be as well. So I have an especially difficult time understanding how this lawsuit is economically rational. Finally, given the website modifications that Smith has already made, I can't figure out why BidZirk thinks that a preliminary injunction is worth pursuing all the way to the Fourth Circuit.

Of course, there is always the possibility that this lawsuit is not about the merits and instead is just an abusive effort to punish a blogger for speaking out.... In any case, the seeming illogic of this lawsuit illustrates why there are comparatively few blog-related lawsuits. Most of the time, it just doesn't make sense to sue over a blog post.

Posted by Eric at 02:11 PM | Content Regulation , E-Commerce , Publicity/Privacy Rights , Trademark | Comments (4) | TrackBack

August 01, 2006

Amazon’s Display of Book Cover Doesn’t Violate Publicity Rights—Almeida v. Amazon.com

By Eric Goldman

Almeida v. Amazon.com, Inc., 2006 U.S. APP. LEXIS 17989 (11th Cir. July 18, 2006)

Introduction

Product photos on e-commerce websites’ product pages are a notorious liability trap. During my tenure at Epinions, product page photos were the only reason why we actually got sued (twice…ugh).

Product photos can raise some pernicious copyright issues, but in this case, the plaintiff sues Amazon for publicity rights violations. Ultimately, the court rules in favor of Amazon, effectively creating a strong precedent that online booksellers are immune from right of publicity claims for displaying book covers, even if the publisher in fact violated the right of publicity. However, the court indulges in a sloppy analogy to offline bookstores that may limit the scope of this opinion to just online booksellers and perhaps a few other media vendors. The case is also noteworthy for a goofy but irresolute discussion of 47 USC 230.

Facts

A publisher published a child’s photo on the cover of a book. The publisher got the requisite publicity consent for the first edition, but there are differing views about whether the consent extended to a second edition. Amazon displayed the second edition's book cover on its product page for the book. The plaintiff sued Amazon for publicity and privacy rights violations (these ultimately merged) and civil theft.

Right of Publicity and 47 USC 230

The district court dismissed the publicity rights claim based on 47 USC 230. This was an interesting ruling because 47 USC 230 doesn’t preempt “intellectual property claims,” so the question arises—is a publicity rights claim an IP claim? A precedential case (Perfect 10 v. ccBill) expressly says yes, Black’s Law Dictionary includes publicity rights in the definition of IP, and I venture that most IP professors cover publicity rights (albeit briefly) in IP survey courses. So I think many of us have assumed/believed that 230 does not preempt publicity rights claims.

The appeals court discusses this issue in some detail but ultimately punts on the question. Instead, it explicitly says it’s not opining on the question, basing its ruling on other grounds. So a definitive resolution of 47 USC 230’s application to publicity rights claims will have to wait another day.

Along the way, the court drops some very unfortunate dicta into a footnote. Agreeing with some confusing dicta from the 7th Circuit’s Doe v. GTE case, this court says 230(c)(1) is “phrased as a definition,” even though the footnote acknowledges the extensive precedent treating it as an operative immunization. The court then continues:

there is no issue of actual or constructive knowledge because the Florida right of publicity does not impose upon interactive service providers an obligation to filter or censor content. Moreover, as a factual matter, there is no indication that Amazon had knowledge of the allegedly misappropriated image and it responded promptly to Almeida's notice by removing [the book] from its websites

This completely gratuitous language will unfortunately give plaintiffs a sense of false hope. As I’ve discussed repeatedly on this blog, actual or constructive knowledge is irrelevant to a 230 determination. See, e.g., Zeran. Yet, this court’s sloppiness will give plaintiffs more grist to try their tired and futile argument that scienter matters under 230. I’m very confident that the impending plaintiff frenzy will give the 11th Circuit the pleasure of revisiting this dicta to clarify itself.

Right of Publicity and Physical/Virtual Bookstores

Instead of 230, the court bases its dismissal on the text of the applicable publicity rights statute, which applies to using an image “for trade, commercial, or advertising purposes.” The court says that Amazon’s display of the book cover on a product page doesn’t qualify. Instead, the court analogizes the online bookseller to a physical space bookseller, where the product page is the equivalent of the bookseller placing books on its shelves:

Amazon's role as an internet bookseller closely parallels that of a traditional bookseller. Because internet customers are unable to browse through shelves of books and observe the actual book cover photos and publisher content, Amazon replicates the bookstore experience by providing its customers with online cover images and publisher book descriptions

The court also distinguished two Girls Gone Wild video cases because the defendants in those cases picked the women to showcase on the product packaging and advertising. In contrast, Amazon was reflected the book cover selected by the publisher.

The court concludes:

Amazon's use of book cover images closely simulates a customer's experience browsing book covers in a traditional book store. Thus, it is clear that Amazon's use of book cover images is not an endorsement or promotion of any product or service, but is merely incidental to, and customary for, the business of internet book sales

It’s always dicey to make analogies between physical space and online contexts, and this analogy is suspect as a factual matter. First, there is no question that Amazon’s product page plays a major role in Amazon’s marketing and sales strategy. It is designed to place well in the search engines and uses a variety of tricks to extract additional sales from the customer. So treating the product page as the equivalent of a store bookshelf is a very charitable view.

Second, and perhaps more importantly, Amazon displays book covers all over its website, not just on the product page. Amazon uses the covers on personalized recommendation pages, in search results, in merchandising emails to its customers, and in content it syndicates to its affiliates (and, I suspect, to other third parties). Basically, Amazon does a ton of marketing for itself using book covers, so Amazon absolutely uses book covers to increase its sales. This sounds a lot like advertising/commercial purposes to me.

Ultimately, as a policy result, I think the court got it right. Amazon is merely depicting the book cover chosen by the publisher, so this ought to be a “contributory” or secondary publicity rights claim—and I don’t think there should be such a doctrine (admittedly, I haven’t researched that topic).

In any case, by making its clumsy analogy to browsing an offline bookstore's shelves, the court effectively limits this precedent to websites that can analogize their pages to such shelves--online book retailers, online music sellers, maybe online poster sellers. However, I think it would be tough to stretch this analogy to, say, search engines—an issue I believe is still live in the Perfect 10 v. Google case.

Civil Theft

Finally, the plaintiff alleged civil theft, which requires knowingly obtaining/using another’s property with the intent to appropriate the property for his/her use. In the context of physical goods, this makes complete sense. In the content of intangible goods, the scope of this statute is very confusing. In copyright cases, we normally don’t have to worry about this claim because it’s preempted by federal copyright law. However, in the context of a publicity rights claim, the copyright preemption doesn’t apply. Here, the court dismisses the claim for Amazon’s lack of scienter (because it didn’t pick the book cover). Even better for Amazon, the civil theft statute has a fee-shifting provision, so the court upholds an award of attorney’s fees to Amazon.

Posted by Eric at 10:12 PM | Derivative Liability , E-Commerce , Marketing , Publicity/Privacy Rights | TrackBack

July 26, 2006

Stay at Home Mom K's Johnny Damon's Right of Publicity Claim

By John Ottaviani

Last week, ESPN.com reported yet another unsuccessful and ridiculous attempt to use trademark law to stifle negative commentary.

According to the article, Ann Sylvia, a Massachusetts mother of two children, has operated an on-line store on eBay since 2001 so she can spend more time at home with her children. The on-line store "Owen & Emma's Place," is named after her children. Among other items, the on-line store sells baby and children's clothing and maternity clothes.

Among the "Daddy's Girl" and "My Mom is Hot" baby bibs and onesies are several items that reveal Ms. Sylvia's baseball affections. The problem in this case was not the "Yucky Yankees" or "Yankees Suck" bibs. Ms. Sylvia also offers bibs and onesies with the phrase "Damon Sucks." Last month, eBay pulled the listing after The Scott Boras Corp. (the entity which acts as agent for the New York Yankee baseball player Johnny Damon) complained that these items violated Mr. Damon's right of publicity. The complaint went so far as to threaten to blemish Ms. Sylvia's eBay rating and jeopardize her "Power Seller" status.

Rather than backing down, Ms. Sylvia swung for the fence. She hit a home run when she pointed out that there were other baseball players named Damon in the major leagues, so that her bibs might not be referring to Mr. Damon at all. Ms. Sylvia eventually reached a compromise by agreeing not to use "Johnny," "Boston," "Red Sox," "New York," or "Yankees" in the listing for that particular bib.

For those who are not baseball fans, the background to this story is that Mr. Damon played baseball for the Boston Red Sox team from 2002-2005, and played a key role in Boston's 2004 World Series Championship. After the 2005 season, however, Mr. Damon elected to leave the Red Sox and signed a four year contract for a higher salary with the New York Yankees, the arch rival of the Red Sox. Many Boston fans (including my daughter) now feel that Mr. Damon is a traitor.

After Eric's commentary on the case where trademark law was used by a restaurant to try to stop a non-profit group from handing out leaflets about the restaurant's labor practices, I hope this isn't a trend. Will the entire crowd be enjoined from chanting epithets at Mr. Damon the next time he appears in Fenway Park? Outside the stadium, will all the vendors of merchandise that uses the names or likeness of Mr. Damon and his teammates in uncomplimentary ways be confiscated? There are significant First Amendment issues here. It also seems that Mr. Damon and his agent might spend their time more efficiently chasing counterfeiters, rather than those clearly commenting on his playing ability, business dealings or loyalty.

Posted by John Ottaviani at 09:21 PM | Publicity/Privacy Rights , Trademark

May 09, 2006

Ebates Sued for Trespass to Chattels--Sotelo v. Ebates

By Eric Goldman

Sotelo v. Ebates Shopping.com, No. 06C-2531 (N.D. Ill. complaint filed May 5, 2006)

The Collins Law Firm has filed a third class action lawsuit over adware, this time targeting Ebate's Moe Money Maker client software. The complaint alleges that Moe Money Maker interferes with other client-side software and that Ebates misrepresents the nature of Moe Money Maker in its marketing. Similar to the other complaints from the Collins Law Firm, this complaint alleges the following causes of action:

1) Computer Fraud & Abuse Act
2) Electronic Communications Privacy Act
3) Trespass to Chattels under common law
4) Illinois Consumer Fraud Act
5) Negligence
6) Computer Tampering
7) Invasion of Privacy under common law
8) Cal. B&P 17200 and Civ. Code 1021.5

The Chicago Tribune article on this lawsuit and Collins generally.

A status report on the other adware-related civil litigation that I know about:

* Sotelo v. DirectRevenue. Settled in March (Suzi's report on the settlement). It appears that settlement freed up Sotelo's time to become lead plaintiff again. I've recommended to David Fish that Sotelo should buy some really good anti-spyware software.
* Simios v. 180solutions. Case is in discovery.
* Michaeli v. eXact Advertising. Motion to dismiss filed Dec. 12, 2005 and still pending.
* Consumer Advocates Rights Enforcement Society v. 180solutions (a/k/a Battalgia v. DirectRevenue), No. 2:05-cv-02547-LKK-PAN (E.D. Cal). According to PACER, the last reported action was a motion to dismiss filed April 24 (principally on procedural grounds).
* Kerrins v. Intermix Media. The case appears to be proceeding. A trial date has been set for January 2007, but the parties could settle before that.

If you are aware of others that I missed, I'd love to hear about it.

Posted by Eric at 11:51 AM | Adware/Spyware , Licensing/Contracts , Publicity/Privacy Rights , Trespass to Chattels

February 15, 2006

Your License, Registration and DNA, Please?

Congress Passes, President Signs, Press ignores...
As broader nationwide DNA database becomes law, states rush to fill database with expanded collection laws of their own.

By Ethan Ackerman

The DNA Fingerprint Act of 2005, which I blogged about late last year, was signed by President Bush into law on January 5, 2006. The legislation expands federal DNA collection efforts to include some legal and illegal immigrants, and allows states to contribute DNA collected for any reason listed under state laws to the federal DNA database. The final language did not change since I first wrote about it. See also the summary here. Rather than rehashing the bill, this post will discuss (1) how the media missed this issue, (2) related state and international developments, (3) the large role individual states' policies will have on deciding just how 'invasive' this database is, and (4) some current 'DNA criminology' shortcomings that this bill may make even worse.

The Media Missed the Issue

While the initial legislative steps of the DNA Fingerprinting Act drew some attention, the media silence on its ultimate passage can be summed up in one phrase - 'buried in layers of legislation.' The DNA Fingerprinting Act was rolled into the 2005 Violence Against Women Act and 2005 DOJ Reauthorization Act, a 176 page mega-bill, which had the effect of obscuring its passage. It took several days for the press to even digest the DOJ bill's passage - its other provisions included Democrat-driven 'mail-order bride' protections and the extensively-blogged 'Cyberstalking prevention' provisions (and even that wasn’t covered in the press until a week later).

International & state developments

On the international scene, Ireland and Scotland, among others, are also expanding DNA collections. (Scotland has the unique wrinkle of being the only UK territory where evidence collected at arrest is held and destroyed if a conviction doesn't follow. Other UK regions already collect and retain DNA at the time of arrest; it is this higher threshold that is targeted for removal.) The UK DNA collection expansion is in tandem with its fingerprint collection expansion - UK police are also set to beging 'roadside' collection of fingerprints. Here again, the UK appears to be following US lead, as several jurisdictions, notably Phoenix, AZ, are already collecting 'roadside' fingerprints, initially voluntarily but now under penalty of jail, for traffic violations. The UK appears to be out in front of the US, however, with 'in the field' DNA collection, with even bus and train drivers collecting DNA of suspects - in this case 'spitting passengers.'

At the state level, legislation expanding DNA collection to suspects is racing through legislatures - apparently regardless of the political party in control. The Democratic-controlled New Mexico House recently passed legislation authorizing collection from felony suspects. The Republican-controlled Kansas legislature is apparently ready to do the same. Indiana, where different parties control the two legislative chambers, is also several steps into the legislative process of passing a similar bill. Somewhat more liberal New York is running into difficulties over Republican Governor Pataki's version of expanded collection authority, which would apply to misdemeanors and felonies, but only after conviction. While the federal DNA bill allows states to collect DNA for any purpose, under any "applicable legal authority," states so far seem focused on expanding collection from just convicted felonies to felonies AND misdemeanors, and in many cases also to criminal suspects, for now.

The pressure for a state 'race to the bottom'

A notable aspect of the piecemeal expansions occurring at the state level is the "race to the bottom" between states that appears likely. States with heightened guilt or suspicion standards (such as 'felonies only' or 'after conviction, not just arrest' states) would benefit the least from their correlatively smaller databases. A database's utility increases exponentially, not just linearly, with the number of entries it contains. Pressed to obtain the maximum value from their systems, or even just a usefulness level comparable to states that collect more DNA, each state would feel a pressure to expand its database to match or exceed other states. Institutional, and often moneyed, motivators such as political platform-staking, a drive for increased governmental efficiency and pressures to lower crime also force states to compete in expanding these DNA databases. These concentrated pressures exert much more force than the diffuse pressures of individual desires for genetic privacy - a classic economic imbalance often seen in other policy-making scenarios.

States with laws already on the books

At the time the federal DNA Fingerprinting Act passed, Virginia, Louisiana, California, Florida and Texas already had laws requiring DNA collection at the time of arrest for some or all crimes. Yet almost all of these states also have had notable instances of erroneous forensic 'mis'matches, with wrongly convicted suspects serving time before their eventual release. In Virginia, a prisoner's life sentence was commuted and he received an eventual pardon after being exonerated by conflicting crime lab tests. In Louisiana, a man served 17 years before an eventual pardon. A minor was convicted of rape and served over four years before exoneration in Texas, and a prisoner served a 17-year term before it was overturned in Florida (search for Rudolf Holton on page), for example.

DNA Database Shortcomings

Just as with any other scientific endeavor, DNA screening is plagued by errors and fraud. What makes DNA screening different is that, unlike carbon-dating trees or replicating embryonic stem cells, fraudulent DNA evidence doesn't just cause media scandals but it is used to incarcerate or execute people.

Error

Like any other human endeavor, collecting, handling, and processing DNA evidence is an error-prone process. The same characteristic that makes DNA evidence so incredibly useful - an amazingly small fragment of as little as several human cells can be used to identify its genetic source - makes it incredibly prone to contamination. Stray chromosomes from a lab worker, housecat, other evidence sample or crime scene witnesses can be misattributed to a person, and this error can be multiplied by the chemical reaction that underlies modern DNA forensics. Worse, even if scientists get the chemistry right, their assistants and prosecutors still have to get the paperwork right and not mislabel or switch results or files.

Fraud

In many cases, a desire to cover up the errors discussed above apparently leads to false or misrepresented DNA results. In other cases, a lack of impartiality - the majority of official state and local crime labs are tied directly to the local police force - is the problem. For example, in Indiana (which is also contemplating an expansion of collections), allegations that prosecutors pressured crime lab workers to alter evidence have imploded the trial of an alleged murderer.

Showing just how far one crime lab employee's evidence-concealing can go, Michigan and Chicago have both investigated the alleged concealment of exonerating DNA evidence by a Chicago crime lab worker who subsequently went to work at the Michigan state crime lab. Chicago settled over $9 million in claims from the incident.

Similarly showing how far irregularities with DNA evidence can get, questionable testimony from a Virginia crime lab was a large part of the reason the US Supreme Court stayed execution (though ultimately declined cert.) on Robin Lovitt's Virginia death row petition in 2005. Lovitt's sentence was ultimately commuted as a result of the misrepresentations. Problems, however, are not limited to state labs. The US Army's lab, which operates roughly in parallel with the FBI's national lab as a crime and records lab for the US military, stands accused of evidence fraud as well.

DNA's mythical status as irrefutable evidence compounds these shortcomings

Criminal jurors, charged with deciding facts in a trial, tend to be irreversibly swayed by DNA evidence, rightly or wrongly. Call it the "CSI effect," but DNA evidence creates an irrefutable connection in the minds of most jurors. While this can be a two-edged sword when juries expect forensic evidence prosecutors just don't have, jury allegiance to DNA evidence tends to harm defendants it is introduced against much more than it exonerates them.

DNA's genetic nature means inclusion is 'inclusion by proxy' for all your relatives, and an 'open genetic book' about personal attributes and status.

DNA, like a fingerprint, is a useful personal identifier. Indeed, there is a scientific and mathematical basis for the uniqueness and correlation of an individual to his or her DNA that is largely absent for fingerprints. DNA, however, is much more than just an individualized identifier. Much like a family tree, bank statement, dental impression or medical history file may serve to identify an individual, these records (like DNA) also contain much personal information unrelated to authenticating a person’s identity. DNA may reveal private information such as legitimacy at birth or the presence of a gender-change operation or marrow transplant. Some research suggests there are also reliable genetic markers for such traits as aggression, substance addiction, criminal tendencies and sexual orientation.

*title with apologies to James F. Van Orden, who authored an excellent, and slightly variant-titled article I discovered after writing this post.

Posted by Ethan Ackerman at 10:12 AM | Privacy/Security , Publicity/Privacy Rights

January 13, 2006

Web Term Paper Lawsuit Settles

By Eric Goldman

In September, I blogged about Macellari v. Carroll. In that case, a student sued a website that allegedly offered her term paper for sale. The case has settled under a confidentiality cloak (registration required). However, a defendant has said he is "happy with the outcome."

A quick settlement certainly seemed like a logical outcome, especially from the defendants' perspective. There was little upside to them to see this case through to a judgment. Of course, settlement also leaves open the risk of "me-too" litigation. One of the defendant's websites claims over 100,000 papers in the database--that's a lot of potential plaintiffs!

Posted by Eric at 10:00 AM | Copyright , Derivative Liability , Publicity/Privacy Rights

October 19, 2005

Latest Junk Fax Lawsuit--Adler v. Vision Lab Telecommunications

By Eric Goldman

Adler v. Vision Lab Telecommunications, Inc., 2005 WL 2621984 (D.D.C. Oct. 17, 2005).

I've set up a Westlaw alert to notify me of new TCPA cases and I'm pretty shocked by the volume of cases being reported under the law--it's way higher than I imagined. I typically get 3-5 emails from Westlaw a week with new cases interpreting the TCPA. Not surprisingly, plaintiffs seem to be loving it!

I'm blogging about this case in particular because of its direct relevance to the adware/spyware cases like Sotelo v. DirectRevenue and Simios v. 180Solutions (I know there's a third case against eXact, but I haven't had a chance to read the complaint yet).

In the Adler case, the plaintiffs brought suit over junk faxes. The defendants moved to dismiss the various claims.

Of particular interest is that the judge granted the motion to dismiss the common law negligence claim, saying that the common law claim was subsumed by the TCPA law. It appears that this specific question has created a split of precedent. The court cited both Morris v. Fax.com, Inc., No. 03-CA-1109 (D.C. Sup. Ct. June 13, 2003) allowing (reluctantly) the negligence claim to survive a motion to dismiss, and Chair King, Inc. v. GTE Mobilnet of Houston, Inc., 135 S.W.3d 365 (Tex. App. 2004), which granted the motion to dismiss.

While the Sotelo court denied the motion to dismiss the negligence claim, I think the Sotelo court ultimately will reach the same conclusion as this court that the negligence claim is subsumed in the other claims.

Also interesting is that the judge denied the motion to dismiss the common law invasion of privacy claim (raised in the Simios case but not (yet?) raised in the Sotelo case). Referring to the Restatements and a motley assortment of precedent, the court says "in extreme circumstances, sending unauthorized fax advertisements may be an intrusion upon seclusion." The court then hastened to add that "Adler may have difficulty proving that defendants' faxes were a frequent enough intrusion to be highly offensive to a reasonable person."

I'd have to research the case law more, but on the face of it, this seems like a big win for anti-fax/anti-telemarketing plaintiffs. There's an acknowledgement that with the right facts, a common law invasion of privacy claim is valid.

Does this thinking port over to the adware/spyware context? The motley precedent cited by the Adler court is heavily laced with references to telephone calls being intrusive, so as precedent this case could be easily distinguished. On the other hand, if the standard is that any marketing intrusion could constitute invasion of privacy so long as the intrusion is frequent enough, then anti-adware plaintiffs should be thrilled!

UPDATE: BNA (subscription required) reports that the case has settled.

Posted by Eric at 06:28 PM | Adware/Spyware , Marketing , Publicity/Privacy Rights

September 22, 2005

Second Anti-Adware Class Action Filed--Simios v. 180Solutions

By Eric Goldman

Simios v. 180Solutions, Inc., No. 05C 5235 (N.D. Ill. complaint filed Sept. 13, 2005). This complaint isn't "new" news; Suzi blogged about it 10 days ago.

This is the second anti-spyware class action lawsuit initiated by David Fish of Collins Law Firm. The first target was DirectRevenue; this time it's 180Solutions. I've critiqued the merits of many of the claims in my review of the judge's first substantive ruling in Sotelo v. DirectRevenue. In this post, I'm going to principally critique some of the differences between that lawsuit and this one.

Venue

In the Sotelo case, the plaintiffs sued in state court. To avoid the Class Action Fairness Act, which mandates that most class action lawsuits are heard in federal court, the plaintiffs tried two techniques: (1) the proposed class covered only Illinois residents who had DirectRevenue's software on their machines, and (2) the complaint named some Illinois-based defendants in an attempt to destroy diversity.

Those techniques failed, and the Sotelo case is in federal court. This time, the plaintiffs didn't even try any of the venue-manipulation techniques and instead originated the lawsuit in federal district court. I'm not entirely clear why being in Illinois state court was desirable, but skipping ahead to federal court seemed like a smart move to me. Among other things, it creates the opportunity to plead some new causes of action.

Defendants

In the DirectRevenue case, the plaintiffs sued DirectRevenue, its holding company, an advertiser and an ad serving network. The diversity of defendants created some complexity and increased the paperwork, as each of the defendants are in different legal positions.

This time, the plaintiffs are suing just 180Solutions. However, it's possible that additional defendants will be added. In particular, I expected the plaintiffs to name some of 180Solutions' advertisers because the DirectRevenue advertiser was not able to get out of the lawsuit on the first try.

New Cause of Action--Computer Fraud & Abuse Act

Because the Sotelo plaintiffs tried to keep their lawsuit in state court, they did not plead any federal claims. Now, freed from that restriction, the plaintiffs bring a Computer Fraud & Abuse Act claim for the first time. The CFAA is a complex law, and I'm not entirely sure that the plaintiffs can establish a prima facie violation. However, I teach my Cyberlaw students that they should always plead common law trespass to chattels and CFAA together (if they can do so within ethical constraints), so adding the CFAA claim made complete sense here.

New Cause of Action--Electronic Communication Privacy Act

Another new federal claim, this time under the ECPA. I'm pretty skeptical about the ECPA claim. The lawsuit alleges that the 180 software "intercepts" communications and "discloses" the contents to third parties. These are the appropriate words under the statute, but I'll be interested to see if the plaintiffs can marshal the right facts to support the claim.

Trespass to Chattels

The complaint has cleaned up some of the damage allegations in support of the trespass to chattels claim (see, in particular, Para. 27), so the claim has an even better chance of surviving a motion to dismiss.

The plaintiffs, however, continue to plead some damages (such as user "frustration") that a court following Intel v. Hamidi simply will ignore. The plaintiffs also kept in some of their silly damages allegations (the software "utilizes pixels and screen-space on monitors"; the software slows performance, which causes the computer to stay on longer, which results in additional electrical consumption). I think the plaintiffs do themselves a disservice by mixing some legitimate and substantive allegations with some trivial and de minimis "harms."

New Cause of Action--Invasion of Privacy

The plaintiffs allege that the software invades their privacy under the common law. I think the plaintiffs intend to fit under the "intrusion to seclusion" tort. While this appears to have been appropriately pled, it's a stretch and, I think, has a low likelihood of success.

Conclusion

I understand that some plaintiffs' lawyers like to use rhetorical tricks, but I thought calling 180Solutions' software a "virus" and referring to computers as "infected" undermined the plaintiffs' credibility. Aside from that (and some other gratuitous allegations that have zero legal significance but were apparently made simply to smear 180Solutions), this complaint is noticeably more tightly drafted than the Sotelo complaint. I expect this tighter drafting gives it even better odds of surviving a motion to dismiss. Whether the lawsuit can survive summary judgment, however, is a much different story!

Posted by Eric at 06:49 PM | Adware/Spyware , Publicity/Privacy Rights , Trespass to Chattels

September 06, 2005

More on Rappers and Car Dealers

By Mark McKenna

In the name of not being left out of the interesting discussion about Snoop Dogg's trademark lawsuit against Gary Barbera (not to be confused with Hannah Barbara, of Flintstones fame), I thought I would put in my .02.

As I said in a comment to Eric's previous post regarding 50 Cent's complaint, I think Eric is looking too hard for a specific trademark of Snoop Dogg's that the dealership is using.

From what I can tell from the complaint on The Smoking Gun (it's not the whole complaint), the plaintiff appears to be alleging both trademark infringement under Section 32 and unfair competition under Section 43(a). I don't think the trademark infringement claim is worth discussing. Like Eric, I don't see any possible basis for a claim alleging use of the SNOOP DOGG. In fact, on its own, I think asserting that claim is borderline sanctionable.

But the 43(a) claim seems to me quite plausible. As John noted below, courts have found 43(a) violations in lots of situations where it was hard to identify what "mark" the defendant was using. That's because 43(a) doesn't require that the defendant be using any mark, or even that the plaintiff have a mark. All that is required is that the defendant use something, or some combination of things, that potentially suggests sponsorship or endorsement. I don't like that rule because it seems destined to result in individuals and companies being able to prevent anyone from referring to them at all (or, as Stacey Dogan says, in having the exclusive right to evoke). It is, nevertheless, pretty clear to me that it is the rule.

So it seems to me that there are only really 2 substantive questions in Snoop's case:

1. Does this ad, as a whole, suggest that Snoop Dogg sponsors or endorses the car dealership?
2. Does Snoop's contractual relationship with Chrysler anticipate uses by the dealers?

If the contract doesn't anticipate uses by dealers or at least give Chrysler the right to sublicense (and I'd be surprised if it does), then Snoop's relationship with Chrysler probably doesn't confer any benefits on the dealer. While the dealer can legitimately claim that the suggestion that Snoop sponsors or endorses Chrysler is accurate (i.e., that the ad contains no false designation of origin because Snoop really does endorse Chrysler), I doubt that runs to the dealer. That is an interesting question though, and I am not familiar with any case dealing with that issue. Is anyone else?

UPDATE: Apparently Barbera is claiming that the 50 Cent ad is based on a radio advertisement that 50 Cent did to promote a giveaway at the dealership [I haven't seen a similar claim relating to the Snoop Dogg ad]. That adds an interesting wrinkle to the case. On the one hand, this could be seen as a simple dispute over whether the agreement between 50 Cent and the dealership relating to the radio ad gives the dealership the right to make derivative advertisements. Assuming the contract is silent on the issue, does that impicitly limit the right to use 50 Cent's name/likeness/image to the radio ad? I don't know for sure, but I'd bet that's the way the contract would be interpreted.

On a more theoretical level, however, that doesn't altogether sit well with me. If the 43(a) claim [set aside the right of publicity claim for the moment] turns on the question of whether the dealership is falsely suggesting 50 Cent's sponsorship or endorsement of the dealership, then doesn't the dealer have a pretty good argument that there's nothing false about their suggestion? Isn't there some real sense in which 50 Cent did endorse the dealership? Is this really that different than when Good Housekeeping recommends a product and the product's manufacturers reference that recommendation in an ad? Or when Terri Welles continues to say that she was "Playmate of the Year," when in fact she was?

Of course, in the long run it probably doesn't matter that much if the dealer is able to make that argument effectively because parties with bargaining power (as we might assume celebrity endorsers generally are) will simply contract around the rule by explicitly forbidding additional uses of their name/likeness/image beyond the particular ads contemplated. And the current right of publicity, which is really broad (too broad, in my opinion), surely doesn't care whether 50 Cent really did ever endorse the dealership.

Posted by Mark McKenna at 12:36 PM | Marketing , Publicity/Privacy Rights , Trademark | Comments (3)

Rappers, Car Dealers and Trademarks --- John Weighs In

By John Ottaviani

Eric and I have been debating the claims in the 50 Cent and Snoop Dogg cases, and whether there can be trademark like protection for "speech patterns." Not surprisingly, as one who likes "non-traditional" trademarks, I am coming down more strongly than he that there are potentially viable "trademark like" claims here.

I would argue that these claims are analogous to the "sound alike" body of cases, in which case this is not really a new legal frontier.

A voice is not copyrightable, because the sounds are not fixed. But courts have already recognized that speech patterns or voices acquire something like "secondary meaning" over time. The First Circuit recognized Burt Lahr's unfair competition claim when Lestoil aired a commercial using an imitation of Lahr's voice with a cartoon of a duck. (Lahr v. Adell Chemical Co., 300 F.2d 256 (1st Cir. 1962). More recently, Bette Midler successfuly argued that when her distinctive voice was deliberately imitated in a television commercial for Lincoln automobiles, it was an actionable tort under California common law for misappropriating part of her identity. Midler v. Ford Motor Company, 849 F.2d 460 (9th Cir. 1988). Tom Waits recovered $375,000 in compensatory damages and $2 million plus attorneys fees in punitive damages on theories of voice misappropriation under California common law (the same claim on which Ms. Midler was successful) and false endorsement under Section 43(a) of the Lanham Act, when Frito-Lay imitated his voice for a radio commercial. Waits v. Frito Lay, Inc., 978 F.2d 1093 (9th Cir. 1992).

So whether you call it "trademark infringement" or "unfair competition" or "voice misappropriation" or "right of publicity," the courts have recognized that there is something wrong with deliberately imitating the well-known, distinctive voice of a professional singer or actor to sell a product. It may be out there at the boundaries of "trademark" law or "unfair competition" law, but courts are using trademark-like concepts to protect the singer's or actor's right to control the placement of his/her voice. And the car dealer situation would seem to be a logical extension of radio and television advertisements to print advertisements.

Yes, in this case, the words are printed in the car dealer's advertisement rather than spoken like in a radio or television commercial. But the car dealer is using either the well-recognized exact quote (If the car is fly ...) or the well recognized speech pattern (..izzle ...) without permission to sell his cars.

The analysis in the car dealer case may be more factually intense, given that in that case there is some arguable relationship (express or implied) between the products and the spokesperson, when there was no authorization (authorization was denied, in fact) in the Waits and Midler cases.

In the end I agree with Eric on one thing ... whether or not Mr. Barbera has successful defenses, unless he likes to spend money on lawyers and spend time in depositions and court appearances, he should find other ways to promote his dealership.

Posted by John Ottaviani at 11:06 AM | Marketing , Publicity/Privacy Rights , Trademark

September 05, 2005

Rappers, Car Dealer Ads, and Expansive Interpretations of Trademark Law

By Eric Goldman

Broadus v. Gary Barbera Enterprises, Inc. (E.D. Pa. complaint filed Aug. 2005).

Ten days ago I blogged about the rapper 50 Cent's lawsuit against the Gary Barbera dealership for running a car ad that showed a picture of 50 Cent with the phrase "Just Like 50 Says." Assuming the dealership ran the ad without permission, this use looked like a textbook misappropriation of publicity rights.

However, the trademark implications were more troubling: 50 Cent does not have a trademark in his likeness but has a registered trademark in "50 Cent." Could we combine the picture plus the trademark to cover the number "50"? Perhaps, although this takes trademark law pretty far.

We get to revisit this issue with the same dealership. On the heels of the 50 Cent fracas, the Gary Barbera dealer ran two ads:

* the first shows a picture of the rapper Snoop Dogg next to the phrase "Is Bar-Bizzle the Sh-izzle? Boy I Gu-izzle."

* the second again shows the picture and uses the phrase, but adds "If the car is fly...then you must buy."

In his complaint, Broadus/Snoop says that he has a registered trademark in the phrase "Snoop Dogg." However, the dealer never used this phrase. Instead, the complaint contends that the dealer used "the distinct speech pattern employed by Broadus and associated with his professional likeness and persona and the SNOOP DOGG trademark" (Para. 12). The complaint goes on further to say that the dealer misappropriated his "speech pattern" and "distinctive manner of speech."

Let's start with the right of publicity. If the dealer does not have permission, then they have misappropriated his right of publicity by using the photo. The problem is that Snoop Dogg made a commercial for Chrysler. Presumably he granted publicity rights to Chrysler as part of that deal. The question is--does the agreement between the dealer and Chrysler sublicense those rights? If yes, then Snoop Dogg has no lawsuit. If not, the dealer is in trouble.

While the right of publicity claims seem relatively straightforward, the trademark claims are far more problematic. Unlike the 50 Cent case, where the dealer at least part of the registered trademark ("50" of the trademark "50 Cent"), here the dealer did not use any part of the registered trademark ("Snoop Dogg").

So how did the dealer infringe Snoop Dogg's trademark rights? Snoop Dogg could have trademark rights in his identity, but the portion of the complaint on the Smoking Gun site made no such allegations, and I doubt that would stick.

The dealer allegedly took his distinctive speech style of using "-izzles," although I'm inferring that Snoop Dogg never actually said "Is Bar-Bizzle the Sh-izzle? Boy I Gu-izzle" (and even if he said it, there's a big gap between saying the phrase and having a trademark in the phrase). So how can he have a trademark in the speech pattern of using "-izzles" in nonsense phrases? I would vote that he simply cannot do so. Trademark law doesn't cover speech patterns, nor could it without reaching too deeply into human communication patterns.

Apparently, Snoop Dogg did say "If the car is fly...then you must buy" in the Chrysler ads. As a result, I don't see how Snoop Dogg can enforce any rights in that phrase; the trademark rights should accrue to Chrysler. In turn, the dealer's rights also depend on the contract between the dealer and Chrysler.

So where is the dealer's trademark use/infringement of a trademark right owned by Snoop Dogg? The photo + nonsense phrases of "-izzle" = trademark infringement of the trademark "Snoop Dogg"? I don't think this is enough to support a trademark infringement claim. Snoop Dogg should win only on the right of publicity claim (or not at all).

In any case, although trademark law may not apply to its behavior, I have a tip for the Gary Barbera dealership: lay off using photos of rappers in your ads for a while. They seem to get you into trouble...and into court!

John Ottaviani's take on this matter. Mark McKenna's take on this matter.

Meanwhile, an update on an unrelated but also overreaching trademark dispute. The LA Times runs a good story about the "What happens here stays here"/"What happens in Vegas stays in Vegas" trademark dispute. While this particular phrase could conceivably infringe, in my previous blog post I reference how the trademark owner is trying to protect too many variations of that phrase.

Posted by Eric at 09:36 PM | Marketing , Publicity/Privacy Rights , Trademark

September 02, 2005

Student Sues Term Paper Website (and its Host)

Macellari v. Carroll, no. 4:05-CV-04161-JPG (S.D. Ill. complaint filed Aug. 31, 2005).

Blue Macellari, a student at Duke and Johns Hopkins, has sued a term paper vendor (Rusty Carroll/R2C2, Inc.) operating three websites (doingmyhomework.com, freeforessays.com and freefortermpapers.com) for copyright infringement, a Lanham Act violation, defamation, privacy invasion and unfair trade practices. The lawsuit also names the web host Digitalsmiths.

I'm not sure what the Lanham Act violation could be, and the defamation claim seems a little tough. The copyright infringement claim, however, seems potent. If, in fact, the term paper vendor didn't have permission, it doesn't have a lot of great defenses. I'm less clear about the web host's liability--did Blue send a 512(c)(3) notice? If not, the theory is that they shouldn't be liable, although a number of courts have bypassed that requirement.

Depending on the outcome, this case could create some real issues for Turnitin and similar services. I've never been fully clear that a court was going to bless their use of student papers for commercial benefit, and this lawsuit might expose weaknesses in their legal posture.

Another interesting angle: Blue's lawyers are doing this pro bono.

Coverage: Lawyer's press release, Chronicle of Higher Education (subscription required), Inside Higher Education, AP story

UPDATE: A copy of the complaint (thanks to John O for pulling it from PACER)

Posted by Eric at 10:47 AM | Copyright , Derivative Liability , Publicity/Privacy Rights | Comments (11)

August 26, 2005

Steinbuch v. Cutler Update--Cutler's Motion to Dismiss

You may recall Steinbuch v. Cutler, where a Washington staffer blogged about her modestly-scandalous sexual experiences with a Senator's counsel. For the voyeurs, I've uploaded Cutler's motion to dismiss the lawsuit filed last month.

The principal grounds for dismissal include the statute of limitations, the facts weren't private, Cutler had run a "private" blog, and the First Amendment. I'm not an expert in calculating the statute of limitations, but on its face this struck me as a pretty potent defense against most of the lawsuit.

As predicted, the lawsuit has some racy facts (I counted 7 references in the motion to dismiss to "spanking"), and the motion to dismiss names even more names. The various factual disclosures/reiterations in the motion to dismiss shows exactly there is a major downside to plaintiffs bringing invasion of privacy or defamation lawsuits. Talk about a relationship ending badly!

UPDATE: Wonkette rightly points out the weakness of the "I didn't understand how to use Blogger" defense.

Posted by Eric at 09:46 AM | Publicity/Privacy Rights | Comments (3)

August 24, 2005

What 50 Cent Really Said--Use the Term "50" and You'll Hear From My Lawyer

Jackson v. Gary Barbera Enterprises, Inc. (E.D. Pa. complaint filed Aug. 2005).

A car dealer in Philadelphia runs an advertisement for Dodge Magnums. Included is a picture of the popular rapper 50 Cent and the phrase "Just Like 50 Says." 50 Cent has a federal trademark registration in "50 Cent" for various categories but alleges that he is "commonly known...informally as '50.'"

On the surface, this seems like a garden-variety right of publicity violation (a cause of action apparently alleged but omitted from the Smoking Gun's papers). If this use was without permission, then I don't see much room for a strong defense.

Note, however, that the dealer is claiming that 50 Cent recorded two sound bite radio promotions for the dealer, in which case perhaps the newspaper ad really is just like 50 Cent said. If so, this may end up as a simple interpretation of the scope of the publicity consent/endorsement contract from the radio promotion, or it could turn into an extremely complicated case about the scope of "fair use" of a celebrity's personality. Consider the analogy--Oprah raves about a product on her TV show; to what extent can that product manufacturer use Oprah's quotes (attributed to Oprah) in their marketing?

However, I'm more interested in the trademark violation on a stand-alone basis. From my perspective, using the photo isn't a trademark violation. And I think it's pretty hard to extend the trademark registration in "50 Cent" to cover "50." It's possible that 50 Cent has developed common law trademark rights in the term "50," but that would require having developed secondary meaning. I know 50 Cent had some popular albums, so I'm pretty skeptical about that! I'd love to see how many people, seeing the phrase "Just Like 50 Says" without the photo, would think that the phrase referenced 50 Cent. Although I'm not the target audience, I strongly suspect the vast majority of readers would find that opaque.

In any case, I always find it interesting when trademark owners try to pluck individual letters or numbers out of the social lexicon and convert them into proprietary assets (this is hardly the first time). You might want to think twice the next time you punch in "50" into your calculator or spreadsheet.

Finally, in a partially-ironic twist, it seems like every newspaper covering this story has used it as an excuse to show more pictures of 50 Cent. Newspaper use of photo to sell newspapers = OK, car dealers use of photo to sell cars = not.

Posted by Eric at 07:32 AM | Publicity/Privacy Rights , Trademark | Comments (4)

May 18, 2005

New Lawsuit Over Blogging--Steinbuch v. Cutler

Steinbuch v. Cutler (D.C. D.C. complaint filed May 18, 2005). Interesting and risqué lawsuit for invasion of privacy and intentional infliction of emotional distress (warning: the complaint is not 100% office-safe). Jessica Cutler ran a blog under the name “Washingtonienne.” In the blog, she provided very specific details about her simultaneous sexual relationships with six different men. In particular, she identified the plaintiff by his initials “RS,” although one time she also referred to “Rob.” She also provided lots of specific details about each person and made a number of disclosures of very personal facts about RS.

Some observations about the lawsuit:
* This is not the first blog-related lawsuit, but as an early case, it has the potential to reinforce that blogs are just another publication medium that can create legal liability.
* The fact that she attempted to blog using pseudonyms may not save her from legal liability. This has direct implications for anyone who thinks it’s a good idea to blog about work situations by revealing details selectively (hint to summer associates tempted to blog about their firms—this means you!).
* This case has all the marks of a messy and titillating lawsuit, so I’m sure we’ll hear a lot more about it because it combines new technological issues with age-old voyeuristic interests in sex.

(Thanks to Daniel Solove at Prawfsblawg for the tip)

Posted by Eric at 11:02 AM | Publicity/Privacy Rights

March 16, 2005

New 47 USC 230 case--Roskowski v. Corvallis Police Officers’ Association

Roskowski v. Corvallis Police Officers’ Association, 2005 WL 555398 (D. Ore. Mar. 9, 2005). Messy disputes between the former Corvallis Chief of Police and the police officer’s association. The Association set up a website to disseminate its gripes with the chief and allowed anyone to post messages there. Unsurprisingly, some of the messages were unflattering.

The chief sued the association (and others) for the negative posts to the website under a false light/invasion of privacy claim. The association claimed 47 USC 230. The court dispatches this part of the claim fairly efficiently. The court cites Stoner and Schneider as precedent that websites are interactive computer services, and the chief used the word “publication” in her complaint, so the court applies the law to false light/invasion of privacy claims (in some sloppiness, the court references defamation here).

However, were the postings provided by “another information content provider”? This should have been an easy inquiry (there’s plenty of precedent on this point). However, the court confirms that the association wasn’t responsible for the postings because it “had no control over who posted or what was posted over the website.” Implicitly using this standard suggests that the court would have been receptive to the arguments made by the Barrett and Grace plaintiffs. Of course, some of us would take the position that the association wouldn’t be liable even if they did have “control” over the posts. See, e.g., Blumenthal v. Drudge, Ramey v. Darkside Productions.

Thanks to InternetCases.com for pointing this case out.

Posted by Eric at 01:49 PM | Derivative Liability , Publicity/Privacy Rights

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