Q2 2014 Quick Links, Part 3 (Privacy, Marketing, E-Commerce & More)

Privacy

* Snapchat’s basic value proposition (“Disappearing digital photos”) has been deceptive from the beginning. The FTC busted them for it. (I saw James Grimmelmann added this to his Internet Law casebook. We’ve also added it to our Advertising Law casebook, coming out shortly).

* European Court of Justice rules that the European Data Retention Directive is invalid.

* Dark Reading: Recent breaches of retail and credit card data are making customers think twice about where they shop and how they pay, researchers say

* Sutter Health v. Superior Court, C072591 (Cal. App. Ct. July 21, 2014). In lawsuit over data security breach of medical records, “No breach of confidentiality takes place until an unauthorized person views the medical information.”

* Seyfarth Shaw: Social Media Privacy Legislation state-by-state summary

* K.W. v. Holtzapple (M.D. Pa. July 10, 2014). College students can’t sue pseudonymously to keep discipline for drug possession from appearing in web searches.

* Scott J. Savage & Donald M. Waldman, The Value of Online Privacy:

the representative consumer is willing to make a one-time payment for each app of $2.28 to conceal their browser history, $4.05 to conceal their list of contacts, $1.19 to conceal their location, $1.75 to conceal their phone’s identification number, and $3.58 to conceal the contents of their text messages. The consumer is also willing to pay $2.12 to eliminate advertising. Valuations for concealing contact lists and text messages for “more experienced” consumers are also larger than those for “less experienced” consumers. Given the typical app in the marketplace has advertising, requires the consumer to reveal their location and their phone’s identification number, the benefit from consuming this app must be at least $5.06.

Marketing

* WSJ on a Dollar Store promotion for diapers that ended up causing big problems for Walmart’s and Target’s price-matching policies.

* New Wikimedia policy against paid editing:

These Terms of Use prohibit engaging in deceptive activities, including misrepresentation of affiliation, impersonation, and fraud. As part of these obligations, you must disclose your employer, client, and affiliation with respect to any contribution for which you receive, or expect to receive, compensation. You must make that disclosure in at least one of the following ways:

a statement on your user page,
a statement on the talk page accompanying any paid contributions, or
a statement in the edit summary accompanying any paid contributions.

Also, MIT Technology Review: The Decline of Wikipedia

My article on these topics.

The Internet Industry

* Bloomberg: Go Easy on Silicon Valley’s Nerds

* NY Times: “Thanks to the high hopes and deep pockets of tech investors, a host of high-profile tech firms are now offering incredible business and consumer services at impossibly low prices.”

E-Commerce

* About the new EU Consumer Rights Directive:

3) Banning pre-ticked boxes on websites: When shopping online – for example when buying a plane ticket – you may be offered additional options during the purchase process, such as travel insurance or car rental. These additional services may be offered through so-called pre-ticked boxes. Consumers are currently often forced to untick those boxes if they do not want these extra services. With the new Directive, pre-ticked boxes will be banned across the European Union.

* Starkey v. Gap Adventures, Inc., 2014 WL 1271233 (S.D.N.Y. March 27, 2014)

Starkey contends that there is no legal precedent to support the proposition that a hyperlink is a reasonable form of communicating the “Terms and Conditions” of a contract. Instead, Starkey argues that Gap Adventures should have included the text of the “Terms and Conditions” in the body of the three relevant communications—the confirmation email, the confirmation invoice, and the service voucher. However, this court has already decided that a hyperlink is a reasonable form of communicating the “Terms and Conditions” of a contract. See Fteja v. Facebook, Inc., 841 F.Supp.2d 829, 839 (S.D.N.Y.2012)…In this case, Starkey acknowledges that she received the confirmation email, confirmation invoice, and service voucher. These three communications stated that in purchasing her ticket, Starkey read, understood, and agreed to the “Terms and Conditions” of her contract with Gap Adventures. Each communication provided a link that Starkey could click on to review the “Terms and Conditions.” However, Starkey chose not to click on any of the links and review the contract.

* Associated Press: Clothing resale sites boom as more shoppers buy with reselling in mind. First sale FTW!

Jurisdiction

* AF Holdings v. Does 1-1058, 12-7135 (D.C. Cir. May 27, 2014):

AF Holdings has made absolutely no effort to limit its suit or its discovery efforts to those defendants who might live or have downloaded Popular Demand in the District of Columbia. Instead, it sought to subpoena Internet service providers that provide no service at all in the District. As Duffy reluctantly conceded at oral argument, AF Holdings could have no legitimate reason for objecting to the court’s quashing the subpoenas directed at these providers. Oral Arg. Rec. 33:00–04. Even for those providers that do serve the District of Columbia, AF Holdings’s discovery demands were overbroad because it made no attempt to limit its inquiry to those subscribers who might actually be located in the District. It could have easily done so using what are known as geolocation services, which enable anyone to estimate the location of Internet users based on their IP addresses. Such services cost very little or are even free. See Amicus Br. of Electronic Frontier Foundation, et al. 24 (observing that “Neustar IP Intelligence . . . provides on-demand geolocation services for $8 per 1,000 addresses); see also http://freegeoip.net (last visited May 22, 2014) (providing this service for free). While perhaps not precise enough to identify an Internet user’s street address, these services “can be accurate,” as Duffy acknowledged at oral argument, Oral Arg. Rec. 23:58–24:01—certainly sufficiently accurate to provide at least some basis for determining whether a particular subscriber might live in the District of Columbia rather than, say, Oregon

Does this suggest the failure to use geo-location will be imputed against Internet defendants in other cases?

* Telemedicine Solutions LLC v. WoundRight Technologies, LLC (N.D. Ill. March 14, 2014). Denying personal jurisdiction when:

None of Defendant’s alleged contacts—its website, Facebook page, Twitter feed, and conference-based marketing efforts—was targeted or aimed at Illinois, or prompted any more than happenstance interactions with Illinois residents

* Advanced Tactical Ordnance Systems, LLC v. Real Action Paintball, Inc. (7th Cir. May 9, 2014):

As a practical matter, email does not exist in any location at all; it bounces from one server to another, it starts wherever the account-holder is sitting when she clicks the “send” button, and it winds up wherever the recipient happens to be at that instant. The connection between the place where an email is opened and a lawsuit is entirely fortuitous. We note as well that it is exceedingly common in today’s world for a company to allow consumers to sign up for an email list. We are not prepared to hold that this alone demonstrates that a defendant made a substantial connection to each state (or country) associated with those persons’ “snail mail” addresses.” Cf. Burger King, 471 U.S. at 478 (contracting with an out-of-state party alone cannot establish automatically sufficient minimum contacts in the other party’s home forum.). It may be different if there were evidence that a defendant in some way targeted residents of a specific state, perhaps through geographically-restricted online ads. But in such a case the focus would not be on the users who signed up, but instead on the deliberate actions by the defendant to target or direct itself toward the forum state. Advanced Tactical introduced no such evidence in the district court and makes no such argument on appeal.