Monthly Archives: August 2012

Linking To Pirated Content: Is It Allowed?

linking to pirated contentIs linking to pirated content legal? Can you be successfully sued over it? Let’s take a quick look at the issue.

Man Jailed For Linking To Pirated Content

A UK court handed down a 4-year prison sentence sentenced to the creator of surfthechannel.com – a search engine for pirated and illegal streaming content. After an 8-week trial, he was found guilty on 2 counts of conspiracy to facilitate copyright infringement. He could have received up to ten years in the slammer, but walked away with four.

Surfthechannel.com was similar to many modern-day filing sharing sites, in that it doesn’t actually host any files; instead, it linked to both legal and copyrighted material. Launched in 2007, analysts estimated that Surfthechannel.com was netting $55,000 a month.

Pleased with the verdict, prosecutors explained:

“This case conclusively shows that running a website that deliberately sets out to direct users to illegal copies of films and TV shows will result in a criminal conviction and a long jail sentence.”

Law Enforcement Went Full-Spy To Catch Torrent Robin Hood

If you think officials aren’t eager to catch copyright violators, think again. According to reports, an “elaborate sting operation” fueled the conviction. Aided by the Federation Against Copyright Theft, one investigator posed as a potential home buyer and shot surveillance video during a real estate open house at his home. Prosecutors also obtained bank information and telephone records of him, his parents, and wife.

A File Sharing Company’s Stance On Linking To Pirated Content

In 2012, a RapidShare lawyer attended the Technology Policy Institute Forum. A man with a purpose, he was there to convince attendees that file sharing sites are not an online copyright problem; instead, sites linking to pirated content (i.e., The Pirate Bay) are the true Blue Meanies.

His two main talking points:

  1. RapidShare is offering a technology, not facilitating piracy, and thus should not be unfairly chastised for others’ wrongdoings; and
  2. Blame the people who link to infringed copy, not the innovators with compliant file sharing sites.

In the company’s exact parlance:

“Rather than enacting legislation that could stifle innovation in the cloud, the U.S. government should crack down on this critical part of the online piracy network.”

In a statement, RapidShare drove home the “linkers-are-evil” trope by explaining:

“These very sophisticated websites, often featuring advertising, facilitate the mass indiscriminate distribution of copyrighted content on the Internet and should be the focus of US intellectual property enforcement efforts.”

It’s difficult to disagree with RapidShare’s point. If you Google “Download The Avengers 2012 Movie,” the sites that pop up in the SERPs are pirated content search sites, not the actual RapidShare page on which the file sits.

UPDATE: Google implemented a new anti-piracy update that incorporates DMCA takedown requests into the algorithm. The more a site gets, the further down the SERPs they’re pushed – a move praised by the RIAA, MPAA and from the sounds of it, sites like RapidShare that are angling to put a compliant face on file sharing.

Play It Safe By Following These Two Simple Rules

This online copyright case invited more turmoil than just a jail sentence. In addition to spending four years behind bars, the convicted pirate-enabler has also declared bankruptcy; plus, according to reports, the incident may have helped wreck his marriage.

Ask yourself: do you want to suffer the same fate? No? Then here are two pointers to avoid an Internet copyright lawsuit:

  1. Quit It: Clearly, the best defense is innocence. If you’re engaged in any type of illegal downloading, stop. Yes, the price of entertainment has arguably gotten out of hand, but if you want to cover your butt, don’t illegally downloaded pirated content.
  2. Don’t Even Link: True of false: linking to pirated content is a legal way to circumvent statutes. FALSE! WRONG! Over the past year, several people have been penalized for linking to infringed content.

A Lot Of Innocent People Are Accused Of Illegal Downloading

Not everybody accused of illegal downloading and piracy is guilty. In fact, the less technologically savvy among us find themselves staring down a legal summons for something they didn’t do. One insecure wireless account, or errant click on a deceptive pop-up ad can cause online copyright legal problems for an unsuspecting, law-abiding citizen.

Online Copyright Attorney, At Your Service

Need help with a n issues related to linking to pirated content — or another online copyright challenge? Get in touch.

Internet Gambling Case Study: NY Judge Says Bluffing Takes Skill

Internet gambling case studyPoker is a game of skill, not chance — so said a New York judge, and the ruling could have huge implications for Internet gambling.

Judge Makes Surprising Ruling In Online Poker Case

The conviction of a New Yorker running a poker club got tossed out thanks to Federal District Court Judge Jack Weinstein who decided that poker is a game of skill and not a game of chance.

In a 120-page opinion, Weinstein wrote:

“In poker, increased proficiency boosts a player’s chance of winning and affects the outcome of individual hands as well as a series of hands.  Expert poker players draw on an array of talents, including facility with numbers, knowledge of human psychology, and powers of observation and deception.”

Teeming with charts and other stats, the opinion explained that skills, like bluffing, could help players win. Additionally, since the gamers in the case were not betting against the house (which can manipulate the odds and chances of winning), but instead against each other, it couldn’t be considered gambling.

“We have patiently waited for the right opportunity to raise the issue in federal court,” said John Pappas, executive director of the Poker Players Alliance, according to NBC News.

Will This Ruling Change Internet Gambling Rules?

The federal court ruling is a “winning hand” for the millions of people who enjoy Internet gambling. While federal laws concerning online gaming have not changed, this decision  may pave the way for regulation changes.

Judge Weinstein also noted that federal prosecutors could still use racketeering laws to mitigate organized crime poker rings and certain Internet gambling operations

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Online Copyright Case Study: NLA vs. Media Monitoring Agencies

Online Copyright Case Study

Online Copyright Case Study: The Meltwater Media Clipping Crisis

Between 2010 and 2014 a seminal online copyright case occupied European courts — and the outcome proved globally significant. The case involved the Newspaper Licensing Agency (NLA) – a UK news consortium established in 1998 to oversee “the granting of blanket licenses to the copyright of newspapers.”

Online Copyright Case Study: NLA v. Meltwater

Mostly used by public relations firms, media monitoring services provide regularly scheduled press clippings. Yes, Google arguably rendered the NLA irrelevant – but that didn’t stop the service from trying to collect receivables!

When it became apparent that search engines provided the same services for free, most media monitors chuffed but continued to play along with the NLA and paid the “Web licensing” fee. Meltwater News, however, said, “Thanks, but no thanks.” To test the legal waters, the NLA decided to sue Meltwater. At first, Meltwater won, but by 2014, a high court had reversed the decision.

Online Copyright Case Study: Lower Courts Side With NLA

What were the lower court’s reasons for siding with the NLA? Well, they decided that a headline, alone, can be copyrighted. Many writers would likely agree with that sentiment, but the legal ramifications would have unintended, disastrous effects.

Why? Well, first consider that every time you pull up a website, you’re technically making a copy of that webpage. The reason why it’s not considered copyright infringement is because nearly all jurisdictions – both domestic and international – accept that by creating a website, the operator is giving users an implicit license to make a transient copy of the page, for viewing. Moreover, the advent of search-blocking technologies, like password-protected sites and robots.txt files, makes it that much clearer as to whether or not an operator’s intention is for the page to be public or private. Plus, under the Copyright, Designs and Patents Act, the only mandatory provision is that fees should not be charged in cases where an act is “carried out for the sole purpose of enabling… a lawful use of a work.”

Online Copyright Case Study: Unintended Consequences Led To Ruling Reversal

The NLA said its only intention was to enforce fees on MM services, but the precedence left the door open for a slew of Internet law lawsuits, and in 2014, the UK Supreme Court reversed the decision, declaring that Meltwater’s clients didn’t need licenses to view collated copyright material online. Why?

  1. “Article 5.1 [of the European Directive Directive 2001/29/EC which covers “temporary copies”[1]:item 9,11] is an exception to the copyright owner’s right to control the reproduction of his work. It necessarily operates to authorize certain copying which would otherwise be an infringement of the copyright owner’s rights.”[1]:item 36
  2. “[I]t has never been an infringement, in either English or EU law, for a person merely to view or read an infringing article in physical form. This state of affairs, which is recognised in the enumeration of the copyright owner’s rights in articles 2, 3 and 4 of the Directive, has never been thought inconsistent with a high level of protection for intellectual property.”[1]:item 36 (Also noted was that to prohibit mere viewing would make infringers of millions of people who would be unaware or unable to prevent themselves from being shown, or temporary automated copies made, of such material, insofar as almost all online content is some person’s copyright.)
  3. The court noted in its ruling, that earlier rulings were made without the benefit or citation of recent crucial cases such as Football Association Premier League Ltd v QC Leisure and Others (C-403/08, F.S.R. 495), Karen Murphy v Media Protection Services Ltd (‘Premier League’) (C-429/08, 1 CMLR 769), and Infopaq International A/S v. Danske Dagblades Forening (‘Infopaq II’) (Case C-302/10), which strongly informed the outcome.[1]:item 10

Source

Parallel U.S. Online Copyright Case Study: Associated Press v. Meltwater

Around the same time, Meltwater was also battling it out with the Associated Press in U.S. courts over the same issue. Unlike the U.K. Supreme Court, however, the AP ultimately won because the compilation of facts is protectable intellectual property under U.S. law. Plus, judges determined that Meltwater failed to present a solid fair use claim.

In the end, however, both sides opted to drop claims and work together to develop new products. How’s that for a happy ending, eh?

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Mobile Payment Processor Legal Issues

mobile payment processor patentsYou’ve developed an innovative new checkout platform for cell phones, “Huzzah!” But before sharing your masterpiece with the world, it’s important to determine if your mobile payment processor complies with the law.

The main questions:

  • “Does this new method comply with the Gramm-Leach Bliley Act?”
  • Does this new mobile payment method protect our customers’ confidential financial information?
  • Do customers have the ability to opt-out of information sharing?
  • Does our processor include safeguards for consumer privacy?

Can Mobile Payment Processors Be Patented?

After consulting with a mobile law attorney, you’ve established that your system is legally compliant, but can it be patented?

First: be aware of the ditches on both sides of the road to patent-dom. Don’t vaguely present your payment processing method, nor as a process of mental aptitude. Instead, detail exactly what your new payment processing methodology is, how it works for online or mobile applications, and prove your business was first to come up with this idea / methodology.

What if Someone Challenges The validity of my patent?

Beginning in September, 2012, two new patent legitimacy test went into effect as a result of the America Invents Act.

If your business has developed the next, best mobile payment processor, get a patent! Intellectual property is a valuable asset, do what you can to protect it with the help of an attorney who’s experienced in intellectual property law, business law, and e-commerce law.

Get in touch today.

Online Behavioral Marketing: A Legal Primer For Internet Advertisers

online behavioral marketing
Can websites track you and your behavior? Sure can.

Online behavioral marketing (OBM) is commonplace, and most people now understand how cookies track Web activity.

But increased use of OBM has also piqued consumer concerns. Who is doing the tracking? What information is being collected? How it is being stored? Let’s explore.

How Many Tracking Cookies Do Popular Websites Use — On Average?

How pervasive is the practice? According to The Wall Street Journal, the world’s top 50 websites deploy over 60 pieces of tracking technology per user, which has led to questions about online privacy and individual rights.

The Federal Trade Commission’s Online Behavioral Marketing Stance

The Dot Com Disclosures Is The Starting Point For FTC Compliance

The Federal Trade Commission – the quasi-governmental United States’ consumer protection agency – advises Internet marketers to follow guidelines delineated in the Dot Com Disclosures. If a marketing campaign uses cross-site tracking techniques, the FTC expects you to provide notice and choice.

According to the FTC, What Is An Adequate “Marketing Notice”?

What constitutes notice? In the U.S., notice is an easy-to-find disclosure statement. International requirements, however, vary – which we’ll get to in a second.

If a third party is serving ads to your website, you MAY not have to provide a disclosure, so long as the party serving the ads includes a statement link within the advertisements.

Mobile Behavioral Marketing Considerations

In addition to current and future FTC guidelines, mobile online behavioral marketers should adhere to the Mobile Application Privacy Policy — a set of behavioral marketing standards developed by the Mobile Marketing Association.

The MMA says mobile marketers should include the following information in online behavioral marketing disclosures:

  • Type of information being collected;
  • How the information will be used;
  • Type of information shared;
  • How information is shared ;
  • How information is kept secure;
  • Explanation of policy change notifications; and
  • COPPA requirements, if it’s an app that targets or attracts kids.

What About Foreign Online Behavioral Marketing Standards? Do I have to Follow the Stricter EU Rules If I’m Based In The US?

Since political boundaries are constantly crossed online, nearly every “wired” country has debated the effects of OBM on their citizenry, but the solutions look different from region to region.

Asia Online Behavioral Marketing

Some Asian countries took an authoritarian route: the government censors and monitors web activity. For example, in South Korea, every citizen is given an “Internet ID number,” which must be used to access online content.

Canada Online Behavioral Marketing

The Privacy Commissioner of Canada released an online behavioral advertising framework, which states that organizations must alert consumers about OBM technologies in a clear and understandable way, plus provide an easy opt-out mechanism.

UK Online Behavioral Marketing

People doing business with UK consumers must comply with the nation’s “cookie law.

If you market to French citizens, know that the country’s guidelines don’t deem browser-default cookie acceptance as valid consent.

At the time of this (original) writing, the United States has yet to pass a universal online privacy bill. Currently, the industry is largely self-regulated.

U.S. Federal Privacy Law?

Most Americans (without the last name Kardashian) value privacy, so it may be surprising to learn that the U.S. doesn’t have a federal online privacy law — save for a handful of financial, health, and age-specific electronic privacy data laws. But it’s not for lack of trying; the past three presidential administrations have tried – and failed – to pass a universal Internet privacy act.

Why Can’t The United States Pass A Universal Online Privacy Law?

Why is it so difficult to push a national Internet privacy law through? Per usual, the bottle neck is largely a result of opposing views among powerful and partisan factions. Established online businesses, marketers, social media companies, and startups firmly believe that the best way to standardize online privacy is self-regulation, while various consumer protection groups are pushing for a codified statute.

There Is An Industry-Wide, Online Behavioral Marketing Self-Regulatory Standard, Which You CAN Be Fined For Breaking

In 2009, the industry adopted a self-regulatory program. The Online Internet-Based Advertising Accountability Program – a division of the Council of Better Business Bureaus – was appointed as the enforcement agency. In 2011, it was announced that six companies had been censured for not complying with industry benchmarks:

  • Forbes Media Extension (FMX) was found to have an opt-out that expired in less than six months;
  • Martini Media was found to have an opt-out that expired in less than six months;
  • PredictAd was found to have an opt-out that expired in less than one month;
  • QuinStreet was found to have an opt-out system that didn’t function properly;
  • Reedge was found to have an opt-out that expired in one year;
  • Vertura was found to have an opt-out system that didn’t function properly.

All the companies named above agreed to change their procedures and worked closely with the council to ensure all measures were correctly implemented.

A Note About Flash Cookies

Several companies that use flash cookies have faced class action lawsuits because of failure to prove sufficient notice and choice. Considered an unfair and deceptive practice, flash cookie lawsuits are often filed in state courts since many of them allow for private action; in fact, one suit was settled for $2.4 million.

Contact Online Behavioral Marketing Attorney

If you’re considering using online behavioral marketing techniques, it’s a good idea to consult with an Internet lawyer who can examine your campaign and point out any non-compliant aspects. Those who engage in international e-commerce are particularly vulnerable, since laws vary by country (even by state.) Get in touch today; we’ll asses your procedures and help make sure you’re operating in the clear.

Is An Ex-RIAA Lobbyist-Turned-Judge Sympathetic to Copyright Trolls?

copyright troll issuesIs an ex-RIAA lobbyist-turned-judge being too easy on a copyright troll?

Who Is This Pro-Copyright Troll Judge Of Which You Speak?

No stranger to the nuances of online copyright issues, Judge Beryl A. Howell has helped draft several significant Internet intellectual property regulations, including the CALEA, the No Electronic Theft Act (NET Act), the DMCA, in addition to the Digital Theft Deterrence and Copyright Damages Deterrence Acts. From there, Howell ostensibly sought greener pastures and hitched her wagon to the RIAA’s star, where she lobbied – nearly exclusively –  from 2004 to 2009. Now, Howell is a judge in Washington, D.C.

Why Did A Judge Wave Through A Copyright Troll Case?

Like the majority of copyright troll cases, this one involves an adult entertainment company – AF Holdings – that is looking to extract funds from 1,058 people who allegedly took part in peer-2-peer sharing of the movie “Popular Demand” – a p-rn flick copyrighted by Heartbreaker Digital LLC.

Sticking close to the “anatomy of a copyright troll” script, AF Holdings first gathered the IP addresses of a “torrent swarm” – a process that relies on imperfect software. Having only the numerical IPs, the group then subpoenaed the ISPs of each address. In response, the IPs argued it was improper to file a single John Doe lawsuit against more than a thousand people. Moreover, the Internet service provider pointed out that a fair percentage of the IPs on the subpoena list were outside the acting court’s jurisdiction, and shouldn’t be included in the lawsuit anyway.

Judge Howell, however, scoffed at the service provider’s arguments and concluded that “the ISPs’ objections to the plaintiff’s subpoenas have no merits.” In response to the question of jurisdiction, Howell reasoned:

“[A] [j]oinder at this stage in the proceedings is the single, most efficient mechanism available for the plaintiff to obtain information to identify those allegedly illegally downloading and distributing its movie. Severing the Doe defendants would essentially require the plaintiff to file 1,058 separate cases, pay separate filing fees, and obtain 1,058 separate subpoenas for each of the Listed IP Addresses. This burden for the plaintiff—not to mention the judicial system—would significantly frustrate the plaintiff’s efforts to identify and seek a remedy from those engaging in the alleged infringing activity.”

It’s unclear if Howell understands that some copyright trolls game the system by filing mass John Doe joinders to reduce court fees and extort citizens, who are sometimes innocent.

Howell also dismissed the ISPs’ assertion that AF Holdings should have used geolocation software to weed out defendants outside of the court’s jurisdiction. Her reasoning being that programs used to establish locality were only 95% accurate. She failed to acknowledge, however, that the software used to sniff out IP addresses – which is arguably the foundation of AF Holding’s case – is just as faulty as the geolocation programs.

The Problem With Torrent Swarms As Legal Proof

One of the oft-used arguments by defendants in copyright troll cases is that it’s impossible to tell if two IP addresses were participating in the same swarm at the same time. If it can be proved that any two of the IPs never participated in the same swarm group, then the joinder can, theoretically, be declared invalid, as the conspiratorial link between the defending parties cannot be demonstrated. Howell, however, rejects that notion. She reasons:

“Although some IP addresses listed in the Complaint are identified as infringing the plaintiff’s copyright four months apart, at this stage there is no basis to rebut the plaintiff’s claims that the Listed IP Addresses were, at least potentially, part of the same swarm and provided or shared pieces of the plaintiff’s copyrighted work.” “If the plaintiff chooses to proceed against those allegedly infringing its copyright after it obtains identifying information, the named defendants may be able to rebut these allegations.”

So basically, Howell is arguing that given the hitherto available information, it’s impossible to prove whether or not the listed IPs were joined in the same swarm at the same time, but there is enough evidence to demonstrate that all the IPs listed may have infringed in some manner. She goes on to say that defendants can raise objections and defenses once the lawsuit has been filed against them:

“Upon receipt of the identifying information sought in the subpoenas, the plaintiff is entitled to seek settlement with these individuals, or decide that pursuing a lawsuit against particular defendants is no longer feasible or cost-effective,” she wrote. “Either course selected by the plaintiff would give the copyright owner the opportunity to effectuate its statutorily protected rights and thereby serves our system of justice.”

Judge Beryl A. Howell’s decision comes at a time when it seemed judges were waking up to the extortive nature of copyright trolls. Interestingly, however, she authorized an immediate appeal.

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Kelly / Warner is top-rated firm that handles all manners of Internet law and online intellectual property issues. Click here to learn more about us and our practice.

Defamation Showdown: Sir Elton John v. Rupert Murdoch (Sorta)

Elton John Defamation
Elton John works hard to protect his reputation, and according to reports, the UK-based performer’s latest face-saving mission is a defamation lawsuit against The Times of London (a Rupert Murdoch production). What has Elton’s keys out of tune? Well, Mr. John feels the paper unfairly linked him to an accountant allegedly associated with an organization known for its tax “restructuring” acumen.

Sir Elton John Wasn’t Happy About Some Tax Inuendos

The article with witch Sir Elton took offense was an expose on “the secrets of tax avoiders,” published on June 21st of this year, and the reporter identified Patrick McKenna as the celebrated singer’s former accountant. The singer was aghast (aghast I tell you!). Apparently, in Elton’s opinion, being linked with McKenna – in even the most tertiary of ways – was the same as saying that Elton John avoided taxes.

The Newspaper Clarifies Its Position

The next day, The Times published a clarification. It read:

“We have been asked to make clear that the film finance partnerships arranged by Ingenious Media, whose CEO is Patrick McKenna, do not offer schemes of this type and they have not been involved in moving money offshore to avoid tax.”

On the same day, the paper also published a retraction saying that McKenna had never been Sir Elton’s accountant.

Sir Elton Didn’t Seem To Accept The Paper’s Apology

Regardless, Mr. John feels The Time’s attempts at mollification were “wholly inadequate.” His lawyer, William McCormick, explained that the “allegations are particularly damaging to the claimant’s reputation in the sphere of charity fundraising.” McCormick further argued that since the stories were prominently placed, the “severe damage to [Elton John’s] reputation” was compounded – not to mention the “personal distress and embarrassment” he suffered over the incident.

At the moment (and for some time), defamation standards in the UK favor the plaintiff more so than they do in the United States, because the UK standard amounts to “the sense of insult and injury.” As such, the country has earned the reputation for being the “libel tourism capitol of the world.” [2016 Update: Several years ago, the Brits shed the moniker as they enacted new defamation standards].

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Interested in international law? Check out our International defamation law database. In need of an international defamation law attorney, contact Aaron Kelly of Kelly / Warner Law.

Linking To Defamatory Content Is A-OK In PA

linking to defamatory content
Back in 2012, the 3rd US District Court of Appeals ruled that the Philadelphia Inquirer wasn’t liable for linking to defamatory content.  More than just an Internet defamation ruling, the case also highlighted how bankruptcy and statute of limitations can affect the outcome of online defamation lawsuits.

Charter School Sues Newspaper For Defamation

Originally filed in 2009 by Chester Community Charter School and CEO Vahan H. Gureghian, the suit alleged that the media outlet published “false, defamatory and misleading” statements about him on account of a failed business deal with one of the paper’s employees.

Should A Website Be Punished For Linking to Defamatory Content?

The Inquirer filed for bankruptcy and the lawsuit ultimately flat lined. Unsatisfied with the outcome, Gureghian waited until the bankruptcy proceedings wrapped up, and then filed another lawsuit. This time around, the CEO claimed that a link to the original article on the Inquirer’s website constituted “republishing.”

Since Pennsylvania libel law adheres to a single publication rule – which means a party cannot be sued for multiple instances of libel over a single work – the bench came down in favor of the defendant, in large part because the material wasn’t “substantially repacked and reissued.” Via this ruling, the Pennsylvania bench made it clear that linking to defamatory content doesn’t qualify as “substantially repacked and reissued.”

The court explained that if the plaintiff won this case, “a publisher would remain subject to suit for statements made many years prior and ultimately could be sued repeatedly for a single (harmful) act.”

An Important Pennsylvania Online Defamation Case

The ruling is significant as it firmly establishes legal precedence in Pennsylvania regarding linking to defamatory content and the single publication rule. Moreover, it makes clear that officials in the state require a significant content change for a “republishing” libel case to hold up against PA’s one-year defamation statute of limitations.

The United States has a federal defamation law, but each state’s regulations vary slightly. To learn about jurisdiction regulations, visit our United States Defamation Law Database.

Talk To A Defamation Attorney

If you’re looking to speak with a defamation attorney, contact us. We have significant online defamation litigation experience and have helped hundreds with their slander and libel law needs.