Briefly, Section 230(c)(1) provides immunity from liability for providers and users of an interactive computer service who publish information provided by others:
No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.

In order to use this provision, there are three elements:

1. The defendant must be a provider or user of an interactive computer service.
2. The cause of action asserted by the plaintiff must treat the defendant as the publisher or speaker of the published information at issue.
3. The information must be provided by another information content provider, i.e., the defendant must not be the information content provider of the published information at issue.

Section 230 does not protect providers or users from all harms, for example it would not protect the provider or user from criminal copyright infringement, or from violating fair housing laws, etc. Still, the fact that it works as it does provides us with the modern internet we know today.

Why I'm thankful for Section 230 is a post from: Cyberlaw Central

The matter was remanded by the Federal Circuit to the District Court, and, as we blogged in December, several additional pre-trial rulings again favored the JMRI project, including a ruling on the eligibility of software code that is distributed for free for copyright infringement damages. The settlement was reached with a trial date on the not-too-distant horizon.

With the settlement, the Federal Circuit and District Court rulings will not be subject to direct appeal. Given the rarity of litigation over open source software, it seems unlikely that the reasoning of these two rulings will be questioned judicially in any other open source litigation for some time.

The settlement agreement is here, and the permanent injunction is here.

The explanation of the settlement on the JMRI site indicates that the proprietary software company has agreed, among other things, not to misuse the JMRI software at issue, or to register any domain names incorporating certain terms attributable to the JMRI project, and will make a payment of $100,000. Future disputes will be settled by mediation or arbitration.

In a post on the declining revenues of the record business, progressive blogger Matt Yglesias wrote last week, "It is, of course, possible that at some point the digital music situation will start imperiling the ability of consumers to enjoy music. The purpose of intellectual property law is to prevent that from happening, and if it does come to pass we'll need to think seriously about rejiggering things."

Is that the purpose of copyright law? Sonny Bunch at America's Future Foundation didn't think so, but his debate with Yglesias turned out to be much more than one of the numerous daily spats that make up life in the blogosphere. Instead, it went to very nature of a crucial institution like copyrightand it asks whether that institution exists to help the creators or society at large.

It's worth thinking about the answers.

I will do a more comprehensive year in review for Cyberlaw generally, but I thought it would be fun to take a close look at how 47 USC 230 fared in 2009. This is the first full calendar year following the Ninth Circuit's en banc Roommates.com opinion, and many of us initially feared that the case would create a huge hole in 230's otherwise solid immunity. As it turns out, those concerns have not come to pass. If anything, 2009 shows us just how strong the immunity remains.

I blogged on a total of 22 cases issued in 2009 that discussed the statute. (I blog on every case I see that substantively discusses 47 USC 230). I blogged on other cases in 2009 that were decided before 2009, such as the Woodhull v. Meinel case from October 2008 and DC v. Harvard-Westlake, a 2007 arbitrator's dismissal that came to light in 2009.

Of the 22 calendar year 2009 cases, I would classify 14 of them (63%) as easy defense wins, frequently on a 12(b)(6) motion to dismiss or state law equivalent. Even many of the remaining 8 cases contained good news for defendants. For example, in Shiamili, the defense inexplicably lost at the district court level but got an easy reversal on appeal. The Stayart court granted Yahoo an easy defense win, although co-defendant Various didn't get the 230 ruling. Similarly, the Barnes case granted the defense an easy 230 win on one theory (negligent undertaking) but denied 230 for a different one (promissory estoppel). The Certain Approval Process case said 230 did not prevent the plaintiff from amending the complaint to add a cause of action, but once added, the court instantly zapped the claim on other grounds.

This leaves four unambiguous 230 defense losses in 2009. The leading 230 defense loss was the Tenth Circuit FTC v. Accusearch case, which held a retailer liable for reselling illicit phone records. The other major 230 defense loss was the NPS v. StubHub case, which held that 230 may not apply to a lawsuit over the alleged illegal ticket scalping by StubHub's sellers. Both of these cases involve the retailing of illegal items, suggesting that 230's boundaries may not reach that far.

The other two defense losses are less consequential. The Project Playlist held that 230 does not preempt state IP law claims, a conclusion that deserves note only because the Ninth Circuit held otherwise in the 2007 ccBill case. I believe that no other courts will follow the Ninth Circuit's rule that 230 preempts state IP laws, making the Project Playlist ruling unsurprising.

In People v. Gourlay, a web host was denied a 230 defense to a criminal prosecution for child molestation- and child pornography-related claims. This case turns mostly on the web host's active role creating the child pornography (as well as the host's molestation of the child actor); with that context, this case may have little influence on other cases. Indeed, the court made clear that web hosts providing standard web hosting services could fully qualify for 230 protection against a state criminal prosecution of child pornography dissemination.

In reverse chronological order, a brief overview of the 230 cases from 2009:

Nemet Chevrolet v. ConsumerAffairs.com (4th Cir. Dec. 29, 2009). One of three federal appellate court 230(c)(1) rulings in 2009 (Barnes and Accusearch are the others). A solid defense win for a consumer review website. The plaintiff's claims that the website contributed to the reviews' development and fabricated reviews were tossed on a 12(b)(6) motion to dismiss.

Shiamili v. Real Estate Group (N.Y. App. Div. Dec. 17, 2009). In an unpublicized January 2009 decision, the trial court denied a website's 230 dismissal request for claims based on user-supplied comments. In December, this error was fixed on appeal despite allegations that the website chooses and administers the user content.

Dart v. Craigslist (N.D. Ill. Oct. 20, 2009). Craigslist got a big win in its ongoing battles with various government agencies over prostitution ads on Craigslist when the court held it wasn't liable for those ads.

Riggs v. MySpace (C.D. Cal. Sept. 17, 2009). A goofy case. The court holds that MySpace's deletion of Riggs' account was protected by 230(c)(1) on the apparent theory that Riggs (the plaintiff) was the third party supplier of the deleted content. This case would make more sense as a 230(c)(2) case.

Finkel v. Facebook (N.Y. Sup. Ct. Sept. 15, 2009). Facebook wasn't liable for the contents of a user's private group even though Facebook placed a copyright notice on the page.

Intellect Art v. Milewski (N.Y. Sup. Ct. Sept. 15, 2009). Ripoff Report wins again.

Stayart v. Yahoo (E.D. Wis. Aug. 28, 2009). An convoluted, and possibly confused, ruling that Yahoo wasn't liable for search results snippets. However, Various was denied 230 because it may have originated the content in question.

Cornelius v. DeLuca (E.D. Mo. Aug. 18, 2009). An online retailer wasn't liable for user-supplied comments despite a conspiracy allegation.

Goddard v. Google (N.D. Cal. July 30, 2009). This is a follow-on ruling to an important December 2008 ruling in this case, which dismissed the plaintiff's complaints but gave the plaintiffs another chance. The December 2008 ruling is one of the most interesting and important decisions interpreting Roommates.com. In the July ruling, the judge again found that 230 insulates Google from liability due to allegedly fraudulent ads run through its network and granted a final dismissal.

Doe II v. MySpace (Cal. App. Ct. June 30, 2009). MySpace isn't liable for users' sexual assaults on other users.

FTC v. Accusearch (10th Cir. June 29, 2009). The second of three federal appellate court rulings on 230(c)(1). The defendant was an online retailer of illegal phone records. The retailer claimed that the phone records came from third party suppliers and therefore 230 immunized the retailer from liability associated with the records. The court echoed the Ninth Circuit's Roommates.com decision, effectively extending that case to the Tenth Circuit, and said that the retailer was responsible for selling the illicit phone records despite 230.

Zango v. Kaspersky (9th Cir. June 25, 2009). This is the only 2009 ruling addressing 47 USC 230(c)(2), the overshadowed and frequently overlooked sibling of 230(c)(1). Despite the rarity of 230(c)(2) cases, this case could be fairly influential. The Ninth Circuit held that 230(c)(2) protected an anti-spyware software vendor's decision to classify software as a threat. If you missed it, you might want to take a look at my presentation slides on 230(c)(2), which distill my deep look at 230(c)(2) this summer.

Gibson v. Craigslist (S.D.N.Y. June 15, 2009). Craigslist isn't liable for physical injury caused by a gun purchased via a Craigslist ad.

Doe IX v. MySpace (E.D. Tex. May 22, 2009). MySpace isn't liable for users' sexual assaults on other users.

Barnes v. Yahoo (9th Cir. May 7, 2009; amended opinion June 22, 2009). The third of three federal appellate court opinions on 230(c)(1). The Ninth Circuit held that 230 preempted a claim against a service provider for negligently delaying the removal of user content (essentially, Zeran redux), but 230 did not preempt a promissory estoppel claim based on promises the service provider made to the person requesting takedown. The initial Ninth Circuit opinion had two other unfortunate digressions: (1) it said that 230 was an affirmative defense that did not support a 12(b)(6) motion to dismiss, and (2) the opinion had ambiguous language implying that 230 preempted only state claims, not federal claims. The amended opinion helpfully eliminated both digressions.

Atlantic Records v. Project Playlist (S.D.N.Y. March 25, 2009). 230 does not preempt a state IP claimin this case, a violation of state copyright law for pre-1972 sound recordings.

Joyner v. Lazzareschi (Cal. App. Ct. March 18, 2009). A message board operator wasn't liable for user posts.

Raggi v. Las Vegas Police (D. Nev. March 10, 2009). A union wasn't liable for messages that union members posted on the union-operated message board.

Certain Approval Programs v. Xcentric Ventures (D. Ariz. March 9, 2009). 230 did not bar amending a complaint to add a new cause of action when the plaintiff also adequately alleged that the Ripoff Report contributed to the creation and development of the content at issue.

People v. Gourlay (Mich. App. Ct. March 3, 2009). This case involves the prosecution of a pornographic web host who also molested the child actor. The web host asserted a 230 defense in trying to overturn the conviction for the charges related to pornography dissemination. Although 230 can preempt state criminal prosecutions, and web hosts are protected by 230 for their ordinary web hosting activities, this web host actively participated in the site's development and therefore lost 230's protection.

NPS v. StubHub (Mass. Super. Ct. Jan. 26, 2009). In a long-running battle between the New England Patriots and season ticketholders who want to resell their tickets via StubHub, StubHub was denied summary judgment on 230 grounds. The court cites Roommates.com in saying that StubHub may have contributed to illegal ticket scalping sufficient to potentially disqualify it for 230 protection.

GW Equity v. Xcentric Ventures (N.D. Tex. Jan. 9, 2009). Ripoff Report is protected by 230 even though it offers pull-down menus and manipulates user-submitted reports.

FRANK SINATRA

May 4, 1976

Mr. Mike Royko
"Chicago Daily News"
401 No. Wabash Avenue
Chicago, Illinois 60611

Let me start this note by saying, I don't know you and you don't know me. I believe if you knew me:

First, you would find immediately that I do not have an army of flunkies.

Secondly, neither myself, nor my secretary, nor my security man put in the request for police protection. It is something that's far from necessary.

It's quite obvious that your source of information stinks, but that never surprises me about people who write in newspapers for a living. They rarely get their facts straight. If the police decided that they wanted to be generous to me, I appreciate it. If you have any beefs with the Chicago Police Force, why not take it out on them instead of me, or is that too big a job for you?

And thirdly, who the hell gives you the right to decide how disliked I am if you know nothing about me. The only honest thing I read in your piece is the fact that you admitted you are disliked, and by the way you write I can understand it. Quite frankly, I don't understand why people don't spit in your eye three or four times a day.

Regarding my "tough reputation" you and no one else can prove that allegation. You and millions of other gullible Americans read that kind of crap written by the same female gossip columnists that you are so gallantly trying to protect; the garbage dealers I call hookers, and there's no doubt that is exactly what they are, which makes you a pimp, because you are using people to make money just as they are.

Lastly, certainly not the least, if you are a gambling man:

a) You prove, without a doubt, that I have ever punched an elderly drunk or elderly anybody, you can pick up $100,000.

b) I will allow you to pull my "hairpiece"; if it moves, I will give you another $100,000; if it does not, I punch you in the mouth. How about it?

(Signed, 'Sinatra')

cc: The Honorable Richard J. Daley
Supt. James Rochford

Mr. Marshall Field, Publisher
Mr. Charles D. Fegert, Vice Pres.

FS:d

This material has been copyrighted may not be reproduced unless used in its entirety and sets forth the following copyright notice:

(c) Frank Sinatra 1976

With the new FTC guidelines for bloggers and other new media types taking effect December 1, 2009 it is a perfect time to point out why this is a good thing for bloggers. Bloggers have had the opportunity to grow unrestricted for years. These guidelines should allow bloggers, hobbyists and professionals alike, not to be pushed up against a wall.

Copyright attorney and intellectual property rights expert Evan Brown said in a recent interview, The new guidelines play the important role of showing participants in the marketplace how the FTC will enforce the laws that help consumers have a better understand what they're seeing or hearing when they view an advertisement or promotion.

Here are five more reasons that it is important

1. Bloggers were the first in this new media push to be paid for their work, community and influence.

2. Without a clear disclosure guideline within the professional blogger community between agencies, brands and individual bloggers much if not all disclosure fell through the cracks

3. With a clearer disclosure guideline structure in place from the FTC it is now understood that this space will be regulated . . . meaning it is a business.

4. To continue being a professional, one must be paid for their skills. If guidelines and or enforcement of those guidelines weren't a reality many businesses that have been looking at this space would withdraw and turn back to traditional media for their buys. Lippe Taylor's SVP of Digital Marketing, Matthew Snodgrass agrees, The blogosphere seems to be forgetting that advertisers are also on the hook with these new guidelines. It will be in the advertiser's best interest to only deal with blogs that will also be adhering to these guidelines.

5. It puts a new emphasis on transparency in new media communications that can only help improve the culture of paid endorsements and the material connections that the FTC monitors to protect the public interest.

DISCLOSURE OF MATERIAL CONNECTION: http://cmp.ly/0

Post from: TechStartups.com

Ownership matters, because otherwise Blizzard and other software vendors can wipe away important consumer rights with legalese contained in license agreements. For example, in Section 117 of the Copyright Act, Congress gave owners of computer software the right to use their legitimately purchased software without having to rely on permissions in license agreements. Blizzard and other software vendors are arguing that customers are not owners, but mere licensees, in an effort to eliminate our rights under Section 117.

This "owner-versus-licensee" trick is not just an end-run on Section 117, it's inconsistent with the law in other areas--the courts and Congress have long rejected efforts by copyright and patent owners to impose all kinds of post-sale use restrictions on books, patented machines, and compact discs. Why should software be different? Just as with those other copyrighted works, if you bought the disc that the software comes on outright (as opposed to leasing it, for example), you should get the privileges of an owner (i.e., the right to resell and the right to make copies and adaptations as necessary to use software).

In short, Blizzard's legal arguments here are all about using copyright law to take away consumers' rights in the software they purchased.

eBay may have sold the majority of Skype earlier this month, but that may not matter if the two original founders of Skype get their way. They have just sued eBay and Skype's new investors for damages that they estimate total a rate of more than $75 million daily.

The case pits eBay against Joltid, which is owned by Skype's founders Janus Friis and Niklas Zennstrom. The issue is around a core piece of peer-to-peer technology utilized in Skype. Joltid seems to have the rights to it and has been seeking to yank the code since at least March. Now, they have filed an injunction and are seeking damages in U.S. District Court.

The lawsuit cites eBay, Silver Lake Partners, and its investment partners, who combined own the popular peer-to-peer calling service. The potential damages cited by the lawsuit are stunning, though. They claim that eBay's altering and misuse of their code could total to more than $75 million per day in damages, as each download of Skype is considered by them to be copyright infringement. If you do the math, that's over $27 billion per year. How they came up with that extraordinary number we cannot even begin to comprehend.

Apparently this is not all that unusual for the Skype founders, according to The New York Times, who reports that they've developed a reputation for litigation, stemming from three lawsuits they filed against an investment banker who represented them in the original Skype sale to eBay.

Tags: ebay, Skype

Beverly Stayart searched her own name and didn't like the results. She got links to pornographic websites, online pharmacies promoting sexual dysfunction drugs, and an adult-oriented online dating service. She sued Yahoo! and other defendants, including the operator of AdultFriendFinder, for false endorsement under the Lanham Act and state-law privacy violations. The court dismissed the Lanham Act claim and surrendered jurisdiction over the state law claims.

Stayart lives in Wisconsin and was previously employed by several major financial institutions in Chicago, attaining the position of Vice President. She's involved in animal protection and genealogy research throughout the world. This includes an internet presence; her periodic posts on one genealogical website have generated almost 17,000 hits during the past three years. (Okay, I'm sorry, but: on the internet as a whole, that's tiny. My stats look more impressive than thatif you've never seen any others.) And two of her poems appear on two Danish websites (they support the preservation of baby seals).

Stayart alleged that she was the only Beverly/Bev Stayart on the internet, and that she had never engaged in a promiscuous lifestyle, or other overt sexual activities, which are repugnant to her and her community. She alleged that her name had commercial value because of her humanitarian endeavors, positive and wholesome image, and the popularity of her scholarly posts on the Internet. The search engine defendants, she alleged, knowingly used her name on false snippets in results by (1) repeatedly linking Plaintiff to the advertising of Cialis by an online pharmacy; (2) repeatedly linking Plaintiff to six separate websites playing pornographic videos containing computer spy ware; and (3) repeatedly linking Plaintiff to a website captioned Free Streaming Porn--HOTTEST DAILY PORN' displaying 27 hardcore pornographic photos. She asked Yahoo! to stop linking her name to these search results. Yahoo! replied: We do not aim to judge web content for appropriateness or censor materials that we find offensive or inappropriate. Instead, we present information as it is reflected on the Web, allowing you to draw your own informed conclusions about what you see.

Stayart also alleged that Various (which operates AdultFriendFinder) used her name on a website advertising its service. She typed her name into altavista.com and got, among the results, jewellery-makin-doorway.orge.pl/bev-stayart.html. This went to an Under Construction site that stated Meet AdultFriendFinder members near Janesville [Wisconsin]-- Over 20 Million Members and displayed five graphic images of fully or partially nude women, accompanied by the age, nickname and city of residence of the women.

Under Iqbal, though a court must accept all well-pleaded facts as true, the claim must still have facial plausibility. And a plaintiff can plead herself out of court, which was what the court determined had occurred here.

False endorsement means that consumers are likely to be misled about a person's sponsorship or approval of a product or service.

In order to have prudential standing under the Lanham Act, Stayart needed to allege at least an existing intent to commercialize her identity. This she didn't do. Though she alleged that her name has commercial value, her complaint is really about distasteful associations. That emotional desire to prevent others from using her name doesn't create Lanham Act standing. Her correspondence with Yahoo!, attached to the complaint, further indicates that her concerns are with privacy and reputation, defamation and demeaning associations. But the Lanham Act does not create a false light tort claim, absent commercialization.

Stayart relied on Doe v. Friendfinder, which refused to dismiss a false endorsement claim against AdultFriendFinder. But Doe didn't address prudential standing in its decision.

The court went on to reach an independent ground for dismissal, lack of likely confusion as a matter of law. [A] commonsense reading of the complaint demonstrates that there could be no likelihood of confusion. The complaint explicitly disavows any association with pornographic materials, sexual dysfunction drugs, or sexually-oriented dating services. This contravenes likelihood of confusion, so Stayart pleaded herself out of court. (Query: before 1999, would Bob Dole have had a claim? He'd never previously been associated with sexual dysfunction drugs, so wouldn't it have been just as implausible that he'd be a pitchman for them?) No one who accessed these links could reasonably conclude that Bev Stayart endorsed the products at issue.

Stayart argued initial interest confusion against AdultFriendFinder. But on the internet, initial interest confusion depends on relatedness of goods and a consumer's level of care. Given that Stayart's identity is completely unrelated to AdultFriendFinder's services, initial confusion won't facilitate free riding on another mark's goodwill. Without a meaningful effect on the market, confusion is of little or no consequence under the Lanham Act. The type of person looking for information about Bev Stayart would not be fooled into using an online adult-oriented dating website. (I'd add in to find her at the end of that; the court might be surprised to find outjust as Stayart might bethe non-Stayart-related interests of the type of people looking for information about Stayart. I'd be willing to bet that even genealogists and animal rescuers sometimes like to meet adult friends!)

Next, a puzzling CDA discussion. The court commented that if Stayart successfully stated a false endorsement claim under the Lanham Act, it would probably fall under the CDA's intellectual property exclusion. But, it continued, one of the fatal flaws of that claim is that Yahoo! didn't use Stayart's name in connection with its own goods or services. It just included snippets from third-party websites and didn't create the content of which Stayart complained. So the proper analysis is vicarious liability/contributory infringement under the Lanham Act.

Under settled doctrine, Yahoo! can't be held liable for failing to remove the search results even after Stayart complained. It didn't control the third-party websites, which fact defeated both contributory and vicarious liability. (That's a shortcut on contributory liability analysis, but not particularly troubling under the circumstances.) The only way Yahoo! could control the results would be to change its algorithm, which goes to the heart of Yahoo!'s role as an interactive computer service. Because ordinary search engines play no part in developing any unlawful searches, 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! doesn't contravene the CDA's IP exclusion because Stayart doesn't have a valid IP claim.

Comment: oh, my. Look, I like CDA immunity generally. But what's weird here is not the court's willingness to use CDA reasoning on an IP claim despite the IP exclusion; what's weird is the court's failure to notice that IP secondary liability doctrine itself incorporates the tech-promoting rationales underlying the CDA. Well, trademark does much more than copyright, these daysbut it's trademark doctrine that's at issue here! There's no need to bring in the CDA! And that last bitthis analysis only applies because Stayart doesn't have a valid IP claimmakes this whole excursion even more obviously useless.

The court then said that matters were less clear with respect to AdultFriendFinder. The site is in some ways interactive, but Stayart's complaint relates to the banner ad associated with the bev-stayart.html URL. AdultFriendFinder's role in the creation of the banner ad content was unclear, so the court couldn't grant it immunity at this stage.

The only claims that remained were state-law claims. Given that the dismissal was on the pleadings, ordinarily a federal court should relinquish jurisdiction, unless it is so obvious how the claims should be decided that the plaintiff should be put out of her misery rather than involving state-court resources. Defendants argued that Wisconsin requires a name to have commercial value in order to maintain a right of publicity claim. But some variations of the appropriation tort, which Wisconsin may recognize, require only commercial use plus bruised feelings. (Doesn't Yahoo! get out of this even if AdultFriendFinder has to proceed in state court? Under what theory is Yahoo!'s use commercial? If it's using snippets from other sites, how can it possibly be distinguished from the New York Times using Stayart's name in a story?)

The distinction between appropriation and the right to publicity (based on commercial damage) is also relevant to CDA immunity. The latter is an IP claim. (Implicit holding: to the extent Stayart is bringing an appropriation claim, Yahoo! is immune.) Plus there's the Perfect 10 versus Friendfinder split over whether state IP claims are preempted by the CDA. Since this is an unsettled issue of federal law, the court couldn't conclude that there was an obvious resolution of the state law claims. Even though the Court already held that Yahoo! was entitled to CDA immunity, the Court cannot say with certainty that a potential right to publicity claim under Wisconsin law is without merit, meaning that the intellectual property exception could save Stayart's claims. Also, AdultFriendFinder's CDA status is unclear, leaving it potentially vulnerable under either a misappropriation or right of publicity claim.

Jammie Thomas-Rasset

Much of Jammie Thomas-Rasset's legal arguments following this summer's $1.92 million Recording Industry Association of America file sharing jury verdict against her don't have much weight or precedent.

Clearly, that a jury in June ordered her to pay $80,000 for each of the 24 music tracks she infringed on Kazaa is outrageous and shocks the conscience and there's no rational relationship between the amount of harm suffered by the recording industry and the award granted.

Thomas-Rasset wass the nation's first sharing defendant to go before a jury. The RIAA has filed more than 30,000 lawsuits targeting individuals, and most have settled out of court.

That said, in their latest court papers, (.pdf) Thomas-Rasset's legal team again is sticking to the argument that the whopping jury award is a due process violation all in a bid perhaps to secure a third trial. (The first ended in a $222,000 judgment against the Minnesota woman, but a mistrial was declared after the judge conceded he gave faulty jury instructions)

Still, it is true that the U.S. Supreme Court and the lower courts have repeatedly reduced lofty jury awards based on so-called due process breached. But those were punitive damages awards, not statutory damages awards.

Those punitive damage reductions, including the Exxon Valdez oil spill disaster, do not apply to Thomas-Rasset's case although Thomas-Rasset's defense team suggests there's always a first.

Punitive damages are the amount a jury awards to punish conduct of an offender. Up until recently, there generally has been no limit. But the Supreme Court has suggested that punitive damages should be limited to about no more than 10 times the amount of actual damages a jury awards.

Higher ratios, the courts have said, are due process breaches because defendants have no notice ahead of time about the lofty financial consequences of their actions.

But the law is crystal clear when it comes to the Copyright Act, the law under which the RIAA sued Thomas-Rasset. Juries can award up to $150,000 per violation. Punitive damages do not fall under the Copyright Act.

One of the only points in Thomas-Rasset's brief that makes a compelling argument is that the Copyright Act, when amended in 1999, didn't conceive of non-commercial cases the RIAA has been bringing the past six years.

The notion that Congress decided that the award of statutory damages in this case was somehow appropriate or tailored to ensure deterrence is a fiction that the plaintiffs would have this court adopt. The Congress that enacted the statutory-damages provision of the Copyright Act could not have had the kinds of illegal but non-commercial music downloading here at issue in mind, defense attorney K.A.D. Camara argues in recent briefs.

It's true: There's no doubt that a $1.92 judgment over $24 worth of music provides the clearest example yet of the abuses made possible by the 1976 Copyright Act, which Congress modified in 1999, at the behest of Hollywood and the recording industry, to carry a maximum penalty for a single infringement of up to $150,000.

That statutory penalty was intended to bankrupt large-scale commercial pirating operations, like organized DVD and CD bootleggers not to put individuals like Thomas-Rasset in debt for the rest of their lives.

Still, the RIAA is crying foul.

After Thomas-Rasset refused to settle out of court, the industry is now demanding that Thomas-Rasset pay up. The RIAA is also seeking U.S. District Judge Michael Davis to issue an injunction barring her from future file sharing.

Plaintiffs' evidence showed that defendant knew what she was doing was wrong, that she did it anyway, and then lied about it for years. Through two trials, defendant still shows no remorse whatsoever for her actions and has made it clear that she has no intention of ever satisfying any portion of the judgment against her, Timothy Reynolds, the RIAA's attorney, wrote (.pdf) Davis.

Judge Davis of Minnesota could rule on the retrial and injunction issue any time.

See Also:

• Jury in RIAA Trial Slaps $2 Million Fine on Jammie Thomas
• Feds Support $1.92 Million RIAA File Sharing Verdict
• Will File-Sharing Case Spawn a Copyright Reform Movement?
• Thomas Seeks New RIAA Trial; Says $1.92 Million Verdict Monstrous
• File Sharing Lawsuits at a Crossroads, After 5 Years of RIAA
• Jury Dings File Sharer $675000, RIAA Prevails Update

• Taylor Lautner - 2009 Teen Choice Awards (socialitelife.celebuzz.com)

Copyright Litigation Handbook (West 4th Ed. 2009) by Raymond J. Dowd

I have posted my syllabus for this semester's Cyberspace Law course. This blog post describes the changes from my 2008 course reader. For more on my pedagogical approaches to the course, see my Teaching Cyberlaw article.

Trademark

* Deleted the Tiffany v. eBay case. This is a really rich and fascinating case, but it is really long and I ran out of time to cover it last year. Also, it will be mooted in the not-too-distant future by a Second Circuit opinion.

* Replaced the Playboy v. Netscape and FragranceNet keyword advertising cases with Hearts on Fire v. Blue Nile. The Hearts on Fire case isn't a perfect teaching case, but it discusses use in commerce, likelihood of consumer confusion/initial interest confusion, and a bit of the policy issues. I suspect a number of my Cyberlaw colleagues are teaching the Rescuecom case, but I chose not to. First, it is doctrinally narrow. Second, it is a confusing opinion. Third, I tried to teach it as a last-minute substitution in my IP survey course last semester and was not satisfied with the results. Finally, it involves the less common fact pattern of keyword sales rather than keyword purchases. So I decided that this year the Hearts on Fire case could cover all the necessary issues adequately.

An interesting note: this is the first time in 15 years that I am not teaching a Playboy case in Cyberlaw. Frankly, I had expected to teach at least one Playboy case in Cyberlaw forevermore!

* Added Google's trademark policy. I'm a little surprised it never occurred to me before to include this in my reader.

* Updated my all-new keyword advertising slides from my May presentation.

Copyright

* Deleted the Perfect 10 v. ccBill and Perfect 10 v. Visa cases. I have been struggling with how to teach the Ninth Circuit's Perfect 10 troika of cases for the last couple of years. The troika was over 100 pages of reading that nevertheless left students befuddled after all that work. But I felt constrained because the troika is the most definitive statement of Ninth Circuit law, and it is insightful to see the cases evolve. Nevertheless, I decided that the Amazon case was the most doctrinally significant, so I kept that and ditched the other 2.

* Added Io v. Veoh. To make up for taking out the Perfect 10 cases, I've added this case, which I think is a very clear exposition of a DMCA online safe harbor case.

* Added Parker v. Yahoo. I think this will be a good case to tie together some copyright doctrinal threads as well as provide a nice compare/contrast with the Ticketmaster v. RMG case.

Trespass to Chattels

* Replaced the Computer Fraud & Abuse Act statute with the most recently amended version.

* Included a slide that synthesizes the various trespass to chattel doctrines into a summary format.

Contracts

* Added the Harris v. Blockbuster case. It's a short case that efficiently makes several powerful pedagogical points--including perhaps most importantly, the perils of robo-drafting by copying language from other people's agreements.

Blogs and Social Networking Sites

* Replaced my old materials on blog law and social networking sites law with my most recent talk on both from February.

* Added my Third Wave of Internet Exceptionalism article

* Added the Moreno v. Hanford Sentinel case as an end-of-the-semester review case. As I said when I first blogged on the case, I think "this is one of the most interesting cases I've seen in a while," and I'm really excited about teaching it. I think it will be an excellent issue-spotting opportunity for students as well as a powerful reminder of the power of published words (and how those words can unintentionally affect the people we love).

Change to the Grading Options

My other big change this year is that I am giving students the option to write a wiki entry on a cyberlaw topic as part of their grade. This was inspired by my forthcoming paper on Wikipedia (which you'll hear more about soon). In connection with that paper, I was researching alternative labor sources that could power Wikipedia, and students working as part of a class assignment was one option I explore in the paper (with some reservations). As part of "eating my own dog food" (a terrible idiom that seems to be prevalent in the Silicon Valley), I figured I should give it a try myself. As you can see, the wiki-drafting is optional, not mandatory, so I'll be interested to see how many students choose the option. I'll also be interested to see what happens when the students actually try to submit their work to Wikipedia. I have a mental image of a massive buzzsaw, but perhaps I'm being too cynical.

In a cease-and-desist letter Williams sent to Hachette Book Group, he provided comparisons from the two books of a wedding, a sex-on-the-beach episode and a passage where a human-turned-vampire describes the wrenching change.

As another instance of similarities, Williams pointed out that characters in both books call their wives "love."

"I think the fans have to read both books and make up their own mind, like a judge is going to have to," Williams said.

I am genuinely baffled by the journalistic ethics debate over TechCrunch's decision to publish Twitter corporate documents that were apparently obtained through "hacking" and then forwarded to the Silicon Valley business blog.

TechCrunch appears to have played no role whatsoever in the alleged hacking. According to TechCrunch, it was simply sent 310 documents, unsolicited. It then decided to print "financial projections, product plans and notes from executive strategy meetings," as well as "the original pitch document for the Twitter TV show that hit the news in May." Why? "[M]ostly because it's awesome." TechCrunch voluntarily refrained from publishing other information contained in the documents, including "floorplans and security passcodes to get into the Twitter offices." According to the NY Times, TechCrunch's founder Michael Arrington (a fellow OMM alum) "is working closely with Twitter as it determines which pieces of information to publish," though "[h]e is protecting the identity of his source."

Here's what I don't get: why the ethical hand-wringing here? Why was TechCrunch's decision to publish some of the hacked documents any different from what mainstream publications like the Times and Wall Street Journal do countless times every day: print information and documents leaked from employees to reporters, without company permission? Every company I've ever heard of prefers to keep its business information confidential. Often, they have formal confidentiality policies, or even require employees (and contractors) to enter into strict nondisclosure agreements. Of course business reporters know this. And yet, without giving it a second thought, they ask employees to violate their duties to their employers, and leak confidential documents and spill the beans on company secrets. And their editors don't wring their hands; they praise their reporters for their scoops.

In some ways, what typical reporters do in soliciting confidential documents is ethically worse than what TechCrunch did. Reporters typically ask sources to give them confidential documents knowing full well that the employee is breaking company policy, and possibly civil or even criminal laws (e.g., conversion or theft of trade secrets). But TechCrunch did no such thing; by its account, the hacked documents just showed up unsolicited in its inbox. And assuming that's accurate, I think TechCrunch faces no significant legal risk from publishing the material. See Bartnicki v. Vopper, 532 U.S. 514 (2001) (radio host not liable under wiretapping statutes for broadcasting illegally intercepted conversations, where he played no role in illegal interception).

The hand-wringers can't have it both ways. Either TechCrunch's decision to print was perfectly legitimate journalism or what business reporters do every single day is even more unethical. Am I missing some distinction?

Sony was supposed to win this. The company made magnetic tape out of like paper and mud back in the 1940s, turned out a "pocketable" transistor radio in the 1950s, and invented the "portable" television by 1960. They had their first video tape recorder by 1963. They weren't the only ones, but they were among the first and best.

The so-called VTR business had a rocky start. The things were hulking bastards, with huge price tags and poor recording capability.

A company called Ampex put out the first "home entertainment" VTR in 1963, only it cost $30,000 in the Neiman Marcus Christmas catalog, and was nicknamed Grant's Tomb because the product manager who thought it up was going to be shoved inside by the company's accountants. (He would have fit, too, the thing was so big.) Sony comes along in the middle of that decade and puts out a $1,200 "portable" VTR that came with a leatherette case and its own TV. It still weighed 65 pounds.

The worst part about these 1960s VTRs was that they were basically reel-to-reelyou had to thread your own 1-inch videotape through spools and stuff, and by the end of the decade, a one-hour spool of tape was like 8 inches in diameter. Can you imagine your TiVo needing 180 spools of videotape to get the job done?

As Sony toiled on the videotape problem, Matsushitawho we now call Panasonicand its independent subsidiary JVC weren't really standing out in the VTR business. Let's say this: Nobody would have guessed they'd be able to overthrow Sony and kick mecha ass within the decade.

However, these guys were among the biggest manufacturers, dwarfing Sony many times over. Matsushita, known for efficiency, not innovation, tended to focus on big boring appliancesTVs, refrigerators, air conditionerswith a smaller team, branded Technics, devoted to dominating the hi-fi realm. JVC was all about TVs and audio gear, and had decent video know-how.

It was Sony who solved the reel-to-reel problem withta daaa!a video cassette. It was called U-Matic, and at 3/4" thick, it was smaller than the earlier formats, but still a bit of a chunkster. Since video was a bit of a Wild West, Sony felt like it needed partners to firmly establish a format, and to avoid a format war. It asked Matsushita and JVC, who said "yes" as long as Sony adopted some changes. They key here: The partnership included a deal where everybody shared all the patents. Turns out, probably not the smartest move by Sony.

Sony was right to form a posse, though. Every single electronics maker in Japan, Europe and America was trying to build a video recorder. Some American firms were obsessed with lasers (though ironically it would later be the Dutch and Japanese firms who actually put lasers to good use); other American firms were jazzed about microfilm...for video. None of them had success. Before we get on with the story, here's a list of totally failed video players and recorders:

Matsushita VX-100 and VX-2000
Matsushita AutoVision
Toshiba/Sanyo V-Cord
Ampex InstaVision
MCA DiscoVision/Magnavox Magnavision
CBS Electronic Video Recording
RCA HoloTape
Sears/Cartridge Television Cartrivision

See what I mean? A friggin' mess it was.

Part of the problem was the message. Nobody knew what the hell this was all about. Sony wasn't just a pioneer in the technology, they thought hard about how to explain why you totally desperately want something bad. At one point, Sony hired Bela Lugosi to dress up one last time as Dracula, and explain that, since he worked nights, he needed to catch up on primetime shows when he got home. Get it? Vampiresthey're out killing people when Barney Miller is playing! It was a good bit, and there were a lot more like it. Little by little, the public caught on to what VCRs were for.

Anyway, U-Matic, launched in 1971, wasn't a runaway success, either, but it was the bestselling video recorder to date, and the first successful VCR. In the realm of pro video, it was hot. Sony cashed in by steering from the home market to the businesses but JVC, who kept trying to pitch it for home use, got hosed. Like villains in some Shakespearean play, Matsushita and JVC kinda lurked in the background, planning for the next round when they might one-up that little charmer, Sony. The name of their plot? Video Home System, which you and I call VHS.

Sony was naive. Like, crazy naive. In 1974, it asked Matsushita and JVC to partner up again, this time on a fully baked format called Betamax. They weren't asking for intellectual collaboration, just a deal to make and sell the things. It was a nice system, with really small tapes, but the problem was, the tapes only recorded for an hour. Sony was like, "That's not a problem," but everyone else was like, "Yes, it is." The would-be partners dragged their heels suspiciously, not signing any deals. Sony kinda thought that was weird, but went ahead and launched the one-hour Betamax box in 1975.

Big mistake.

Not long after Sony went into wide release with the one-hour Betamax, JVC pulled a two-hour VHS out of its butt. And in time for Christmas 1976 no less. Sony had another flash of naivete when it pressed on with the one-hour system for a while, even though it had a two-hour system in the works. In that gap, JVC and its big poppa Matsushita scored sales and recognition.

Some people say Betamax was "better" but that depends on many factors, and could very well be an urban myth. The technologies were so close Sony's own chairman called VHS a copy of Betamax. What may have looked good in one system with certain settings might not look as good on another with different settings. And by some accounts, Betamax's more moving parts meant they were more expensive to manufacture and more costly to maintain and repair. It's not an open-and-shut case of quantity vs. quality. Either way you look at it, there are compromises.

By this point, it wasn't just some anything-goes contest with a million formats. By 1976, all those above had died or were dying. In Japan, there were just two choices. The Japanese government told everyone to sort it out. Hitachi, Mitsubishi and Sharp joined Team VHS, but didn't really move forward.

In February 1977, Sony grabbed Toshiba and Sanyo, and then signed the American powerhouse brand Zenith up for an order of Sony-made Betamaxes with the Zenith name on them. Was it going to happen for Betamax after all? Seemed like they'd finally drawn at least a few good cards from the deck.

Sony might not have been totally screwed at that moment, but there were two American powerhouses, and the other one, RCA, was undecided. Ironically, the fate of the Japanese VCR industry relied on how well it could handle the most American of sports: Football. In other words, now that both players could manage two hours of recording time, what RCA wanted was enough recording time to capture a gamethree hours would do.

What transpired next is unclear. Even though, at the time, both technologies were limited to two-hour capacity, Matsushita pledged to make RCA tape machines that could record for four hours.

Was this a lie? Was it vaporware? Whatever the deal, JVC engineers pulled off a four-hour capacity six weeks later, and RCA agreed to buy 55,000 machines that year, and up to a million more in the next three years. Better yet, RCA's SelectaVision VHS decks would cost $300 less than the two-hour Betamaxes, at $1000 a pop.

Although Betamax hung on for a bit longer, that, boys and girls, was the end of the competition. In 1979, Sony market share tilted downward, and by 1980, the jig was up for those poor bastards.

Note: I recognize that there are other issues that might have come into play here, including Universal's lawsuit of Sony, which lead to today's Supreme Court definition of fair-use copyright law, and the fact that some studios, including Warner, began squeezing movies onto videotape early, with varying degrees of success. However, I contend that none of that changed the outcomethe war above was fought between Sony and Matsushita, and Matsushita won.

SOURCES:
Fast Forward: Hollywood, The Japanese, and the VCR Wars - James Lardner (Special thanks to you, Jim, for chatting me through some of this)
Sony - John Nathan
The History of Television - Albert Abramson
Sony History - Sony Global Website
Made in Japan - Akio Morita
Quest for Prosperity - Konosuke Matsushita
[PDF] Case Report on Betamax - Verardi et al
"Why VHS was better than Betamax" - Guardian UK - Jack Schofield

Gizmodo '79 is a week-long celebration of gadgets and geekdom 30 years ago, as the analog age gave way to the digital, and most of our favorite toys were just being born.

Back in June 2008, I wrote Hey AP! How About Running A Real News Web Site?, which in the wake of AP making noise about fair use guidelines examined how the organization failed to provide any central article that anyone could point at. A key part of my article:

To get back to the bloggers, let me point out a key problem you have. Your stories appear everywhere, like weeds. Then they die, unlike weeds. Like they disappear after roughly 30 days. This was an issue I pointed out when the Google deal was struck.

Now skip ahead to this past May. In writing Do Newspapers Owe Google Fair Share Fees For Researching Stories?, I said:

Let's consider last week's wonderful story from the AP about how old Japanese maps on Google Earth are causing problems with some in that country. Given that news stories have a tendency to disappear, I'm going to link to the story using its entire headline: Old Japanese maps on Google Earth unveil secrets. Now if the story should move for some reason, as least with the headline, there's a chance of locating it in some new location.

Try to go to that story today, where I linked to it at, and you get a 404 error:

The page you've requested does not exist at this address.

Nice. As Jean commented, you can still find the article over at the Huffington Post. Perhaps HuffPo's deal with the AP allows stories to be up longer than 30 days. Certainly the Seattle Times still has it, also. But the copy over at Yahoo is dead, meaning all that Digg love it had generated is now going to waste.

If people wonder why I might seem so hostile to newspapers screaming about how badly they're being done by Google, bloggers and aggregators, it's stuff like this that does it. This is lunacy. It doesn't engender respect or a believe that the AP or other organizations really understand the world they're operating in.

I linked to the article the AP itself had put out on its own web site. They kill it. Links from Digg that would generate thousands of visits are allowed to die. Duplicate content across the web isn't regulated by the AP itself there's no instructions for publications to block that content from search engines; no thought about consolidating links; no thought about how no one can tell what's the authorative piece that they should link to.

And yet the AP and others yap that they don't get credit enough, that people rip them off, that Google should somehow have supernatural abilities to make up for the mess they contribute to. Please.

But hey, it's all going to be better now. AP proposes new article formatting for the Web from the Associated Press itself tells us of a new standard (write that headline down, so you can find the article in 30 days when it dies). It involves meta tagging articles, which will:

The tag[s] identifying usage rights could allow Web sites that aggregate content to automatically sort articles by copyright terms and let publishers more easily track how their stories are being used, said Srinandan Kasi, AP's general counsel.

If you want to know more about the system, visit the Value Added News site. Don't worry as you're told:

Adding semantic value to your news is not rocket science. It doesn't even require serious plumbing in the depths of your database.

Then scroll down after that intro, and your head will hurt. Like if I use the microformat for Daily News, which Daily News is that? Because there's a number of them out there. The tech specs don't help.

As for the AP already using this, when I looked, I didn't see tags on some selected articles I examined. I certainly didn't see them on AP content being redistributed by AP members. I even wonder if the tags will carry over across the various content management systems out there, once they leap forth from the AP.

But wait, there's more. What about ACAP? That's supposed to be a shining star in the rights management area that AP signed on to ages ago. ACAP, which is being positioned (see also here) to European legislators as part of a solution to protect newspapers and publishers from those evil aggregators.

So now AP is going to use a second system in addition to ACAP? And yet meanwhile fail to follow the most important system, basic SEO?

Sigh. Maybe later I'll ask the AP about it. Maybe they'll even decide that someone from the AP can speak to me, unlike earlier this year. Believe it or not, I'd like to see them succeed. I only wish it were less talk, less smoke-and-mirrors, less we can't unless and more action with what they really can do now, in an action that technically makes sense.

Because news spreads faster we're supposed to give newspapers a monopoly on the news? That's crazy.

Jarvis makes a compelling point which lawyers advising newspapers ought to think about when counseling newspaper clients.

Schultz and the Marbergers complain about what they call the free-riding' of aggregators, et al. But they simply don't understand the economics of the internet. It's the newspapers that are free-riding, getting the benefit of links.
The framers of our Constitution, including the First Amendment, intended it to endure and cope with the effects of the anticipated changes of our nation.

Things have changed - changed quickly. But let's be careful when thinking of following lawyers and Judges who may not understand the nature of the change.

I understand his view, although I am not sure it is the best decision from a policy stand point. It is important not to lose site of the fact that copyright holders with content on the internet still have significant protection. Direct copying of the stories is already protected by copyright law, especially if a paper registers its copyrights and can get statutory damages. Of course, as I pointed out Friday, it is hard to police the use of facts from news stories. So, it will be difficult to make an infringement case when someone truly summarizes a news story. But I can see the value in incentivizing traditional news media to continue spending on reporters and reporting. For example, a system of paying newspapers, and other content providers that would choose to opt into the system, a nominal fee for click-throughs on links from your site to a current news story. To me that seems like a reasonable compromise which would not cost most websites much, but could provide real economic benefit to news websites, thereby maintaining reporting staffs. Of course, newspapers could accomplish something similar and maybe even economically better by shifting to subscription-based sites, which has been received with mixed reactions and effects previously.

But more important than which position is correct, is the discussion. While the Constitution does give Congress the power to protect copyrights, it says little about how to protect them. That is left to Congress, which enacts copyright laws based upon the technology available when the law is drafted and some limited vision of technology to come. As a result, it is difficult to effectively apply the Copyright Act of 1976, even with more recent amendments and additions, to every aspect of the internet world. So, in light of the fast pace of technological change over the last ten to twenty years, an open dialogue about how to make the copyright laws adequately protect authors and the public is very important. And as O'Keefe and Jarvis point out, it is a dialogue that requires more than just lawyers, who understand the legal issues, but artists, newspapers, media consumers and many other copyright stakeholders.

I stand by what I said. They did copy my song but I don't think they did it on purpose. I can understand why they got so upset because they probably don't even realise they have done it. It happens all the time. I have even copied myself without knowing I have done it. I'll write down what I think is a new melody and then listen back to it and realise it's the same as something I have already done. It's just one of those things and I don't want them to think I'm angry with them. I'd love to sit down and have a cup of tea with them and let them know it's ok.

Blaise Alleyne is an expert at the Insight Community. To get insight and analysis from Blaise Alleyne and other experts on challenges your company faces, click here.

As copyright was originally enacted, it was next to impossible to accidentally infringe. In the good old days in order to infringe on a copyright you had to physically publish a song or a book without permission by printing it onto paper via a printing press. There was no other way to copy or infringe on a song or a book and there was no such thing as a performance right protected by copyright.

Nowadays we infringe copyrights numerous times throughout the day without even thinking about it. Watching an unauthorized SNL clip on YouTube. Playing the radio in the background at work where customers can hear. Loaning a copy of your Finding Nemo DVD to play at your kids' daycare. Downloading clip art to use in a personal scrapbook. Scanning your own wedding photos. Forwarding a funny photograph to a friend. Loaning a co-worker some software. Etc., etc., etc...

Copyright laws are so utterly pervasive in our lives that we simply cannot reasonably function without at least some innocent infringement. I personally think it'd be easier to avoid jaywalking and speeding than it would be to avoid infringing. So my question to you guys and gals, how long do you think you could last without infringing a copyright?

Conwell v. Gray Loon Outdoor Marketing Group, Inc., 82S04-0806-CV-00309 (Ind. Sup. Ct. May 19, 2009)

This is a classic cautionary tale about interactions between a web developer/host and a customer. The customer retained the web developer to develop a website. The paperwork between the parties was not a model of clarity. Later, the customer orally asked the developer to modify the site; this time, there is only garbled conversations and no paperwork. The developer modified the site but the customer changed its mind and asked the developer to roll back to the earlier version. But the developer could not do so because it didn't keep a copy of the earlier version (what???), The customer stiffed the developer and the developer took the website offline. The developer sued for non-payment; the customer cross-sued for conversion on the theory that it had paid for the site and had been deprived of its property.

The Indiana Supreme Court wrestles with several questions, concluding that:

1) The relationship was governed by common law principles applicable to services, not the UCC Article 2 applicable to goods. This is a tricky area of the law, but I think this may be the more logical result for a combination web developer/host, especially one who never actually delivers any code to the customer.

2) Was there an enforceable agreement to amend? The trial court said yes, and the Supreme Court saw no reason to override that factual finding.

3) Did the developer convert the code/website by erasing the old version? The application of ancient doctrines of "conversion" to intangible bits always makes me queasy, and it's led to some confused jurisprudence. In this case, the court sidesteps all of that doctrinal messiness for the simple reason that the customer never obtained ownership of the code. This is really basic copyright law. Customers who want ownership of the work done by vendors need to spell that out in a written agreement. No written agreement specifying customer ownership, no customer ownership--it's that simple. The court says the customer didn't properly obtain ownership in the written customer-vendor agreement, so the vendor had retained copyright title to its developed code all along, and the customer never had title to be converted.

As usual, so many problems are completely avoidable through proper communication through written agreements and amendments between customers and vendors. Some other obvious observations here:

* it's hard to imagine many web development disputes that are worth taking to a state supreme court, especially one where the outstanding bill was about $5k.
* if you are a web developer's customer and you want to own the developed code, you have to say so in a written agreement
* and, if you want a copy of your website's code, make sure you say so in the contract AND actually get a copy!
* if you are a web developer, you might keep customers happier if you keep every version of their website's code instead of tossing old versions.
* this dispute would have be governed by UCC 2B or UCITA if either were the law of Indiana. I wonder to what extent the new ALI Principles on the Law of Software Contracts (acknowledged in the opinion) will help resolve future disputes like this.

This case reminded me a little of the New Mexico v. Kirby case from a couple years ago, where a customer's failure to pay its website developer while keeping the developed code led to an unexpected jail sentence. I offer more lessons about web developer-customer relationships in that blog post.

While the customer lost the battle here, the issue of when electronic records are subject to conversion doctrines is hardly going away. This court reaches the sensible result that a putative owner gets no protection from conversion unless he/she actually has title to the asset. Read literally, though, I wonder if this ruling could undercut claims over conversion of virtual world assets? After all, a virtual world asset holder may rarely have clear title to the asset; certainly the holder won't be the copyright owner of the asset. Perhaps the analysis will be different in situations where a third party (the virtual world operator) allocates "title" within its own titling system to users--it might still be possible to deprive an asset holder of "title" within that asset system even if the asset holder would have no conversion claim against the virtual world operator if the operator takes the exact same steps to deprive the asset holder.

Other comments about this case:
* Juliet Moringiello
* Eugene Volokh

On Tuesday, President Barack Obama nominated Sotomayor, a judge in the 2nd U.S. Circuit Court of Appeals, to the replace the retiring Justice David Souter. The former private IP lawyer's cyberlaw decisions ranged from copyrights in a digitized world to warrantless computer searches, so-called click-wrap agreements and the Patriot Act .

In 2002, Sotomayor wrote a decision (.pdf) nullifying Netscape's online click-wrap agreement, which demanded binding arbitration of disputes between Netscape and its customers. The free download button for Netscape's browser software was high on the web page, with the user-agreement well below.

We conclude that in circumstances such as these, where consumers are urged to download free software at the immediate click of a button, a reference to the existence of license terms on a submerged screen is not sufficient to place consumers on inquiry or constructive notice of those terms, Sotomayor wrote.

Consumers sued Netscape claiming browser cookies amounted to illegal eavesdropping. Netscape claimed the click-wrap agreement demanded out-of-court arbitration. As we all know, it turned out that cookies are lawful and mostly harmless.

In a December case, Sotomayor joined in a unanimous appellate decision on the 2001 Patriot Act. The ruling limited the application of the automatic gag orders that bind ISPs that receive an FBI national security letter a type of self-issued subpoena demanding information on a customer.

If confirmed, she will be the first justice who has written cyberlaw-related opinions before joining the court, the TechLaw blog wrote.

As a New York District Court judge in 2007, the nominee ruled that The New York Times could digitize and sell freelancers' work, despite the writers' claims of copyright infringement. The Supreme Court reversed her decision. The court is current set to hear that case again, and Sotomayor would likely have to recuse herself from the rehearing.

In 2001, as an appellate judge, she upheld (.pdf) the warrantless search of a New York Department of Transportation computer. The accountant was suspected of neglecting his duties and the government searched his computer without a warrant, leading to his job loss. The authorities found unauthorized accounting software on Gary Leventhal's computer, which was believed to be used for his private accounting practice.

The searches, Sotomayor wrote, were reasonable in light of the DOT's need to investigate the allegations of Levanthal's misconduct as balanced against the modest intrusion caused by the searches.

See Also:

• Free-Lancers Have Just Begun to Fight
• Court Narrows National Security Secrecy, Limits Oversight

The essence of the dispute is that Power Ventures, instead of developing its interface through the Facebook Connect developer program, created a Facebook user account and accessed Facebook content through that account. Facebook alleged that the creation and use of that account was in violation of the Facebook Terms of Use. Facebook Complaint 24, 41. The complaint also alleges that Power Ventures used the interface that it created to induce Facebook users to share their usernames and passwords, and then utilized that information to access Facebook servers via its interface in a manner that violated the Facebook ToU.

The complaint alleges that the ToU prohibits a variety of activities, including, among other things, solicitation of passwords or personally identifying information for commercial or unlawful purposes; using or attempting to use the account of another user or creating a false identity; using automated scripts; impersonating another person or entity; sending junk mail or spam; harvesting e-mail addresses; registering for more than one account; and using Facebook's website for commercial use without the express permission of Facebook. The ToU also provides that the limited license granted to access and use the site terminates when the site is used other than as specifically authorized herein.

The copyright claim alleges that in violation of the ToU, Power Ventures used its account to access and copy the Facebook Web site, including the Facebook home page for which Facebook has obtained a copyright registration. Complaint 31, 70. Judge Fogel concluded that the allegations of the complaint made out a sufficient claim of copyright infringement because Power Ventures need only access and copy one page to commit copyright infringement. The court also found that the ToU prohibited downloading, scraping or distributing content from the Facebook Web site content except that belonging to the user, and that in any event, using automated methods, i.e., data mining, robots, scraping, or similar data gathering or extraction methods to access any content were also prohibited by the ToU. Thus, the court found that the allegation that Power Ventures accessed Facebook via automated means constituted made out a claim of direct copyright infringement, while the allegation that Facebook users utilized the Power.com interface to access their own profile pages made out claim of secondary copyright infringement.

Judge Fogel also declined to dismiss Facebook's claim that the use of automated scripts to access Facebook copyrighted content bypassed specific technical measures designed to block such access and thus violated the DMCA. The trademark infringement claims were sustained based upon the inclusion in the complaint of a screenshot illustrating the use of the Facebook mark on an e-mail sent by Power Ventures to Facebook users. The court did order Facebook to file a short statement clarifying the basis for its California unfair competition claim.

The complaint also alleges a federal CAN-SPAM claim stemming from the transmission of e-mails to other Facebook users encouraging them to use the Power.com interface. According to the opinion, Power Ventures abandoned its challenge to the sufficiency of the CAN-SPAM claim, as well as its challenge to the sufficiency of the complaint under the CFAA. The CFAA claim also is grounded on the allegation that Power Ventures's access to Facebook's computers was unauthorized because it was in violation of the Facebook ToU.

The court's refusal to dismiss Facebook's claims demonstrates that careful drafting of a Web site terms of use is essential to obtaining legal redress for unauthorized access, particularly unauthorized access by competitors and others for commercial purposes. Access that violates the clear proscriptions of a ToU can form the basis for a multiplicity of legal claims, thereby maximizing the chances of a successful challenge to unwanted access.

The lawsuit was filed on behalf of the FSF by attorneys for the Software Freedom Law Center. The SFLC is the "enforcement arm" of the FSF, a law firm formed for the specific purpose of providing legal services for open source developers seeking to enforce the provisions of open source licenses. Prof. Eben Moglen is the chairman and one of the directors of the firm.

This was not the first lawsuit filed by the SFLC, but it is notable in that some of the underlying code which is alleged to have been infringed was authored by none other than Richard Stallman, the founder of the Free Software Foundation and a first-line mover and shaker in the open source movement. According to the Copyright Office public catalog, Stallman is an author of code covered by registration No. TX 2-084-819, one of the registrations enumerated in the complaint against Cisco. The record shows that the copyright was assigned to the Free Software Foundation.

There has as yet been no announcement of the settlement from the FSF or the SFLC, and the docket in the district court does not reveal the terms of the settlement, only an order dismissing the action with prejudice and without costs. Some past settlements of similar actions announced by the SFLC have included not only an agreement on the part of the defendant to provide the source code as required by the GNU GPL, but also an agreement to appoint an Open Source Compliance Officer to monitor compliance with GPL licenses, an agreement to undertake "substantial efforts" to notify those to whom products were distributed of their right to receive the source code, and payment of undisclosed financial consideration.

The pro se attorney plaintiff in Burcham v. Expedia brought suit against the travel site under Missouri consumer law, claiming that Expedia knowingly misrepresented the hotel amenities for a room that he booked on the site. He sought $5 million in damages and class certification.

It didn't help the court's view of the case that the room was booked for a hotel in Missouri in November, and one of the amenities that Burcham claimed was absent when he and his children arrived at the hotel was an outdoor swimming pool. Fair enough, Burcham also claimed that the hotel lacked an indoor swimming pool, conference room, restaurant and bar/lounge. But the court pointed out that Burcham's complaint did not allege that he or his children wished to use any of the absent amenities.

Burcham was off to a bad start.

Expedia moved to dismiss Burcham's complaint, relying on the forum selection provision that specified Kings County, Washington as the proper venue. Expedia submitted evidence showing multiple versions of its terms of use, including the current and past versions, which the court concluded contained the same material terms.

Expedia also established by affidavit that Burcham's booking had been made by a process under which the user was presented with a legend stating: "By continuing on you agree to the following terms and conditions." Beneath the legend, the full text of the terms and conditions was displayed. In order to book a room, the user was required to click on the "continue" button.

Confronted with this evidence, Burcham argued that he simply did not remember seeing the terms and conditions when he used the Expedia site. He suggested that he may have used the site from a shared computer at his law office without checking to see if the prior user of the computer was already logged onto the site. Thus, he argued, the prior user may have clicked past the terms and conditions, but they were never presented to him.

The court briefly reviewed the relevant case law (e.g., Specht v. Netscape, Register.com v. Verio, ProCD v. Zeidenberg) and the distinctions between clickwrap, shrinkwrap and browsewrap agreements, and quickly concluded that Expedia had an "enforceable online clickwrap agreement" with Burcham. Burcham's argument that he never saw the terms and conditions was dismissed both on the facts and the law.

On the facts, the court found, Burcham offered no evidence to support his "clever theory" that someone else clicked past the terms and conditions, and the undisputed facts showed that the user account created at the time the terms and conditions were assented to was associated with Burcham's own e-mail address. On the law, the court concluded that if Burcham in fact had accessed the Web site under someone else's account, he was still bound by the terms and conditions to which that user had assented, citing, e.g., Motise v. America Online, Inc., 346 F.Supp. 2d 563 (S.D.N.Y. 2004) (individual using the online account of another user bound by the same terms and conditions as the account owner).

Burcham also tripped over the evidence he himself submitted to the court along with his brief. The court noted that the Expedia Web pages Burcham submitted as exhibits contained a hyperlink at the bottom to the full text of the Expedia terms and conditions. The court noted that the terms and conditions stated that users of the site consent to be bound by those terms and conditions by accessing and using the Web site. Thus, the court concluded, even if Burcham wasn't clickwrapped, he was browsewrapped.

Finally, the court quickly dismissed Burcham's arguments that the forum selection provision was unreasonable and in contravention of Missouri public policy and that the contract as a whole was one of adhesion.

The ruling in Burcham v. Expedia is a win for the enforceability of online agreements, and another loss for pro se attorney plaintiffs for whom courts seem to have little sympathy. See, e.g., Field v. Google, 412 F.Supp. 2d 1106 (D. Nev. 2006) (rejecting pro se attorney plaintiff's "manufactured" copyright infringement claim based on Google Web crawling and caching).

Burcham v. Expedia, Inc., 2009 U.S. Dist. LEXIS 17104 (E.D. Mo. Mar. 6, 2009)

The Scranton Times, LP v. Wilkes-Barre Publishing Co., 3:08-cv-02135-ARC (M.D. Pa. March 6, 2009)

Oh man, how bad is it in the newspaper business? Rather than investing in building new and sustainable business models and relationships with their subscribers, newspapers are like dinosaurs trying to eat each other while the temperature rises. However, instead of eating each other, the dinosaurs are suing each other, squandering their valuable capital on low-merit newspaper v. newspaper lawsuits, such as the GateHouse v. NYT lawsuit over the republication of headlines.

Today's lawsuit is even more scoffable. The Scranton Times is suing the Wilkes-Barre newspaper for republishing obituary notices in its Scranton edition that were initially published in the Scranton Times. But the Scranton Times has a problem--funeral homes typically write and submit the obituary notices, so the Scranton Times has no copyright interest in the notices. Undeterred, the Scranton Times sued the Wilkes-Barre paper for a bunch of junky unfair competition-style claims in Pennsylvania state court.

This ruling deals with the Wilkes-Barre defendant trying to remove the case to federal court by showing that there is a federal question of whether the junky claims are preempted by federal copyright law.

The most interesting discussion relates to the hot news misappropriation doctrine. I just discussed the doctrine last month in the AP v. All Headlines News case, where the SDNY said that the AP's hot news claim against an online aggregator/syndicator survived a motion to dismiss. I've seen some breathy law firm announcements that this ruling revitalized the hot news doctrine, but not so fast, guys. Here, the court says that the obituary notices fail to qualify as hot news, and therefore the misappropriation claim is preempted by copyright law.

In particular, the court says that obituary notices can qualify as time-sensitive information, such as timing of memorial services. Further, even though the newspaper doesn't write the obituary notices, the court says that the newspaper bore all of the costs of collecting and distributing the notices, and the rival paper free-rode on those investments. However, the court said that the Scranton Times had failed to show that the free-riding would threaten the Scranton Times' publication of obituary notices. Thus, the hot news claim failed.

The court looks at the copyright preemption of other junky unfair competition claims, holding that the unfair competition claim was really a reverse passing off claim, which was preempted, as was the tortious interference and unjust enrichment claims. Oddly, the court said that the conversion claim wasn't preempted by copyright law, even though the only "converted" assets would be copyrighted intangible material (the obituary notices).

So a few of the junky claims survive the copyright preemption analysis, but there isn't much hope for this lawsuit. Then again, unless the Scranton Times realizes that fighting a rear-guard action against its competition does nothing to improve its future business prospects in a market disintegrating around it, there isn't much hope for the paper either.

HT: Tom O'Toole

In Williamson v. Delsener, NY Slip Op 01333 (1st Dept. 2009), the Appellate Division, First Department held, in a dispute over the terms of a settlement, that e-mails exhanged between counsel, which contained their printed names at the end, constitute signed writings (CPLR 2104) within the meaning of the statute of frauds (citations omitted) and entitle plaintiff to judgment (CPLR 5003-a[e]).

Therefore, if you, in a legal context, agree to something in an email which you send with your standard, printed signature at its end, courts will consider the agreement to have been reduced to writing, and it may well be viewed as part of an enforceable contract. So, add this to the myriad reasons why you must be careful before pressing your send button.

Richter v. INSTAR Enterprises Int'l, Inc., No. 08 C 50026, Slip Op. (N.D. Ill. Jan. 23, 2009) (Kapala, J.).

Judge Kapala granted defendant INSTAR's Fed. R. Civ. P. 12(b)(2) motion to dismiss plaintiff's copyright infringement claims for lack of personal jurisdiction. INSTAR did not have sufficient contacts with Illinois for general jurisdiction. INSTAR did not maintain offices or otherwise regularly do business in Illinois. Its contacts with Illinois were: 1) its interactive website; and 2) INSTAR's customer's resale of its products within Illinois. Additionally, INSTAR produced undisputed evidence that less than .1% of its business came from Illinois and that none of the accused products were sold directly into Illinois.

Similarly, the Court lacked specific jurisdiction. While plaintiff was allegedly harmed in Illinois, the effects doctrine was not satisfied because INSTAR was not charged with an intentional tort and INSTAR's unrefuted evidence showed that it did not intend to infringe plaintiff's copyrights. INSTAR's website did not create specific jurisdiction either. There was no evidence that INSTAR made any sales into Illinois from its website. And the only evidence of anyone from Illinois accessing the website was based upon plaintiff's representatives accessing the site. Finally, the entry of INSTAR's products into the stream of commerce did not create specific jurisdiction because there was no evidence that INSTAR knew or expected that the stream of commerce would take its products into Illinois.

John McCain says he was a puppet for the Republican National Committee and therefore should not be held accountable for a presidential campaign commercial that used the popular song "Running on Empty" by Jackson Browne without permission.

But the Los Angeles federal judge presiding over the copyright-infringement case was not buying it. The judge refused late Friday to remove the Arizona senator from the lawsuit in which he and the Republican National Committee are accused of violating the rights to Browne's 1977 hit.

Here's what McCain told the judge (.pdf)handling the case:

I was not involved at all in any way in the writing, creation, production, distribution or dissemination of the video, nor do I have any knowledge whatsoever of how this video was written, created, produced or disseminated or who was involved in any aspect of the writing, creation, production, distribution or dissemination of the video. I was completely unaware that this video even existed until I was informed of it after this lawsuit was filed.

Despite McCain's claims of being a hapless dupe for his party, U.S. District Judge R. Gary Klausner said (.pdf) the RNC and McCain's relationship were so intertwined what the judge called an "agency relationship" that McCain stays in the case. The judge wrote that, even if McCain's statement were true, "once an agency relationship is established, the principal is liable for the acts of her agent, even if the principal does not expressly authorize or instruct her agent to take any action."

The judge also did not agree with the Republicans and McCain that Browne's lawsuit was bogus. Among other things, the judge kept the lawsuit alive to give the defendants a chance to demonstrate how using about 20 seconds of the song in the commercial was a fair use.

The August commercial was broadcast on YouTube and cable television. It played Browne's music in a McCain commercial criticizing Barack Obama's energy policy. The song was purchased on iTunes.

Browne claims that the commercial falsely suggested he endorsed McCain and the Republican Party. "Nothing could be further from the truth," Browne said.

The judge scheduled an April 20 hearing to determine how to proceed with Browne's lawsuit. The ad initially ran in Ohio, but the Ohio Republican Party was removed from the case.

See Also:

• Stifled by Copyright, McCain Asks YouTube to Consider Fair Use ...
• McCain Campaign Yanks 'Obama Love' Web Video
• YouTube to McCain: You Made Your DMCA Bed, Lie in It
• McCain Uses Walter Reed Middle School, Not Army Hospital, as ...
• McCain's Disputed Fox Debate Clip a Viral Hit Online
• Meet the Latest Copyright Scofflaw -- Meet the GOP
• Parody of News Team Deliberations Over Alleged McCain Outburst ...
• John McCain Campaign Takes a +3 Vorpal Blade to Dungeons & Dragons ...

• Metafilter comment from January 6
• User Friendly from January 12

• Metafilter comment from January 26
• User Friendly from February 16

• Metafilter comment from January 26
• User Friendly from February 13

• Metafilter comment from February 8
• User Friendly from February 12

• Metafilter comment from January 21
• User Friendly from January 27

This is wonderful.

The statement calls for the end of paper versions of the journals, not merely supplementing them with electronic versions, because printing them costs so much and is bad for the environment. I don't know if the drafters of the Statement were also thinking that going purely digital would help force a change in mindsets, but I suspect that that would be one of the most important consequences.

[Tags: open_access law_school law_journals publishing media scholarship copyright copyleft everything_is_miscellaneous ]

Associated Press v. All Headline News Corp., 08 Civ 323 (SDNY Feb. 17, 2009)

We've seen a lot of ruffled feathers over Internet republication of news headlines, ledes and snippets--the most recent being the GateHouse lawsuit and settlement, but we can easily go back at least a dozen years to the old Shetland Times lawsuit to find similar issues. Some of the teeth gnashing is due in part to the ambiguity and paucity of directly applicable law, so any new judicial ruling, even an opinion on a motion to dismiss, is noteworthy..

According to the opinion (which is a little cryptic), All Headline News either rewrites AP stories or copies stories in full, strips out the source identification in some cases, and republishes its version of the stories to a network of paying customers. To the extent All Headline News is a syndication service of real-time news, it appears to be at least a partial competitor of AP. AP alleged a number of claims against All Headline News, and this ruling addresses All Headline News' motion to dismiss the following complaints:

* Hot News. After concluding that All Headline News was subject to NY's law, it held that a hot news claim was properly pled. This makes sense in light of both the original INS v. AP case from 1918 (which addressed a not-dissimilar set of facts) and the more recent 1997 2nd Circuit Motorola case, which held that sports scores might be protectable under a hot news doctrine. While we have not seen a lot of viable hot news claims in the past dozen years, the hot news doctrine remains important because it exists independent of copyright. Accordingly, the republication of headlines and ledes could be a hot news misappropriation even if it isn't a copyright infringement. Because of the early procedural posture, the hot news claim might still fail, but the hot news doctrine's survival of the motion to dismiss isn't a favorable development for news aggregators and republishers.

* Copyright Management Information (17 USC 1202). We haven't seen much action under this portion of the DMCA, which protects against the removal or modification of "copyright management information" (such as a byline) from copyrighted works. It hasn't been extensively litigated, and the courts have interpreted the statute narrowly. Despite that, the court does not dismiss the claim. It will be interested to see if the AP can have any success with this claim given the narrow precedent supporting it.

* Trademark Infringement. The court dismisses the trademark infringement claim. The AP's pleading of both CMI violations and trademark infringement points to an interesting conundrum for content publishers/aggregators. Remove the source attribution and you create a potential 1202 problem. Preserve the source attribution and you might be committing trademark infringement. The court overcomes the damned-if-you-do/damned-if-you-don't situation by implying that citing your sources can't be a trademark infringement.

* Unfair Competition. The court dismisses the 43(a) false advertising claims but preserves the common law unfair competition claim.

Implications. if, in fact, All Headline News is paraphrasing or plagiarising AP stories to operate a competing business, this is a materially different factual scenario than the aggregation and republication of headlines/ledes/snippets that has been the primary focus of Internet legal angst for the past few years. Nevertheless, revitalized doctrines of hot news and 1202 copyright management information both pose significant risks to these aggregation and republication activities independent of the copyright analysis. At minimum, this is a good reminder that focusing purely on copyright infringement claims misses other important considerations.

HT: Marty Schwimmer