Monthly Archives: December 2013

StarCraft: South Korea’s Public Enemy #1?

Forget Justin Bieber, in South Korea, StarCraft superstars reign supreme in the eyes of tweens. Don’t believe me? Behold:

But now the South Korean government wants to go all Susan Powter and stop the insanity. That’s right. Officials believe 125,000 of their countrymen are suffering from serious gaming addictions, so authorities are screaming for Regulations! Rehab! Revenue!

The Doctor Evil-esque plan to curb gaming in South Korea

  • Step One: Declare video gaming an “antisocial addiction” on par with drugs, alcohol, and gambling.
  • Step Two: Start a “just say no [insert video game]” campaign while simultaneously limiting the amount of advertising (a la Joe Camel in the U.S.).
  • Step Three: Collect 1% of revenue from gaming companies; use funds to pay for a government-run, “Gaming is Gambling!” campaign.

Oh My Gosh! REALLY!?

Why do South Korean authorities think gaming is in need of taming? In 2011, a man and wife killed their baby because of a gaming addiction. The parents only fed the child once a day, and the infant died of malnutrition. Shockingly, the couple neglected their baby because they spent all day raising a virtual baby in an online game. Since the incident, people have been calling for gaming restrictions.

Parents Are The Same No Matter Time Nor Place

Ninety percent of AARP-eligible (and adjacent) South Koreans are all, “Hell Yeah!” about the proposed gaming sanctions. “We need to create a clean Korea free from the four addictions [drugs, gambling, alcohol and gaming],” opined lawmaker Hwang-yea. And weighing in for Team Mom was Kim Min-Sun, who champions gaming restrictions because, “without online games, kids would talk to their mother and play.”

“We’re Not Drug Makers, Mmmmmmk.”

The rest of the population – especially “Internet-lifers” – aren’t stoked about the crackdown. A spokesperson from the Korea Internet and Digital Entertainment Association succinctly quipped, “The 10,000 people employed in the game industry are not drug makers.”

Why Are Video Games So Popular In South Korea?

Why is video gaming so popular in South Korea? Some people point to the lack of leisure opportunities for teenagers. Other people blame the country’s insanely competitive school system, arguing video games are the best way to unwind after a grueling day at school.

South Korean Officials Love Game Regulations

This is not the first time the South Korean government has tried to regulate online gaming activity. Back in 2011, officials passed a law banning gaming between midnight and dawn for people under 16. Somewhat of a legislative bomb, the law is currently on appeal in Korea’s Constitutional Court.

Assistant’s Defamation Lawsuit Against Maria Menounos

A celebrity entertainment television personality won a defamation lawsuit against her ex-stylist after losing an anti-SLAPP motion.
A celebrity entertainment television personality won a defamation lawsuit against her ex-stylist after losing an anti-SLAPP motion.

Extra host Maria Menounos won’t have to pay her ex-stylist defamation damages. We’re blogging about the case because it proves a win is possible after a failed anti-SLAPP motion.

Menounos Confronts Her Ex-Stylist At An MTV Party About Missing Dolce and Gabbana

Menounos’ defamation woes began in June 2011 at an MTV party in Hollywood. While schmoozing, Maria spotted her ex-stylist, *Alicia*(not real name). Apparently, Menounos and Alicia parted ways awhile back; but at the party, Menounos approached Alicia and loudly declared, “Dolce & Gabbana won’t lend to me anymore because they said you never returned anything!”

[DUN, DUN, DUN!]

Assistant: “You Called Me A Thief! I’m Suing You!”

Outraged over the finger-pointing, the stylist filed a defamation lawsuit.

Menounos tried to shut down the claim by filing an anti-SLAPP motion, but the judge said (I’m paraphrasing here), “Nah ah. Alicia has a right to plead her case because the average person wouldn’t have reason to know or care about [Alicia’s] life.”

Why Does The Stylists’ Celebrity Status Matter For A Defamation Lawsuit?

U.S. defamation law differentiates between public and private citizens. In most cases, if a public personality is the plaintiff, and the issue at hand is a matter of public interest, the defendant will win the defamation suit. (Not always.) To learn more about the higher preponderance of evidence standard for public figure plaintiffs in defamation claims, go here and here.

Uh Oh. Somebody’s Past Caught Up With Her In The Courtroom

So, off to trial court the two parties went. During discovery, Menounos’ lawyers used the age-old defense for defamation, truth. Confident in its findings, Menounos’ team had unearthed dirt about Alicia involving a grand theft conviction circa 2000 and a past job termination, allegedly linked to theft.

Eventually, the plaintiff settled. Judging from reports, it doesn’t appear that Alicia walked away with anything.

The lesson: truth is a strong defense against defamation. Even if a statement causes you severe embarrassment, it may not be defamatory. Every defamation case is different. It’s best to consult a defamation attorney before deciding whether or not to file a lawsuit. He or she can give you a good idea about your chances of winning.

Revenge Porn: The End of Days?

Is revenge porn on its way out the door?

Are we living in the end days of “revenge-ography.” Last week alone saw the arrest of a website proprietor and the introduction of a new revenge porn law in Pennsylvania.

California Man Arrested and Charged For Running a Website Racket

A California man may spend 2 years behind bars thanks to an extortion racket. His dastardly business plan involved two websites, ugotposted.com and changemyreputation.com. On ugotposted.com he solicited compromising pictures of women from disgruntled ex-lovers. Disturbingly, “content providers” included victims’ full names, locations, ages, and Facebook Profiles. On changemyreputation.com, he charged the women hundreds of dollars to remove pictures and information. According to the police, the operation made tens of thousands of dollars.

How Is revenge Porn Legal and Will It Be Stopped Anytime Soon?

Simply stated, Revenge porn is childish. And in a country that loses their collective mind over a nipple slip at a half-time show, the fact that revenge porn is, technically, legal in many states has a lot of people wringing their hands and asking, “WHY!?” The answer: property and copyright laws.

It’s Only Legal If The Victim Originally Sent or agreed to the Picture or Video Being Used

Revenge porn is only legal if the victim originally gave or consented to the material. For example: if somebody let his or her lover take a nudie pic or sex tape, or if somebody sent a selfie to another person. Revenge porn is NOT legal if the person wasn’t aware you were recording/photographing them.

States Are Eagerly Drafting and Passing Revenge Porn Laws

Recognizing its harmful effect on victims, many states are now passing laws illegalizing revenge porn – even when the victim had originally sent or gave permission for the pics. Maryland, New York and more than a handful of other states are in the process of passing revenge porn laws. In fact, just last week, Pennsylvania legislators introduced a bill that would make “revenge porn-ing” a second-degree misdemeanor that carries a 2-year prison sentence and a fine of up to $5,000.

In other words, the days of revenge porn website may soon be over.

Lawyer For Revenge Porn Lawsuits

Do you have a revenge porn issue? Do you want to consult a lawyer about the matter? Contact Kelly Warner Law. We’ve handled several revenge porn cases and understand the expediency and confidentiality required. Think of us as revenge porn doctors – we’ve seen it all and nothing shocks us; we’re just here to help make the damage go away.

Payday Loan Law: Sen. Markey and FTC On The Hunt

payday loan legalitiesSenator Ed Markey of Massachusetts asked the FTC to snoop around payday loan lead generators. If you run a lead generator website for payday loan programs, consider an audit for your operation.

Sen. Markey Pushes To Investigate

On December 4, 2013, Markey sent a letter to FTC Chairwoman Helen Ramirez. In it, he urged the agency to explore privacy issues related to payday loan companies. Basically, he suspects rampant and egregious violations of Section 5 of the FTC Act, which governs “unfair and deceptive marketing.”

In his missive, Markey relayed the story of a reporter who gave information to a payday loan site. According to the Senator’s letter, the reporter was “bombarded” with multiple loan agent introductions within minutes. The journalist hadn’t authorized distribution.

“These business practices raise a number of concerns about what these lead generator websites do with consumers’ personal information, whether they store and secure it and whether these websites sell this personal information without consumers’ knowledge of consent,” opined Markey.

Not only is Markey concerned about possible privacy breaching aspects of payday loan generation, but he also isn’t thrilled about the sensitive nature of collected information, like social security numbers and bank account routing codes.

“I believe an investigation of this (payday lender) practice would fall within the FTC’s mandate as stipulated in Section 5 of the Federal Trade Commission Act with respect to protecting Americans from ‘unfair and deceptive acts or practices,’” concluded Markay.

Markey Spearheaded The FTC Data Broker Probe, Too

This is not the first time the Massachusetts senator has taken up arms for consumers when it comes to online privacy issues. Last year, at almost exactly this time of year, Markey sent a similar letter to the FTC regarding data brokers. And yes, the commission did look into the matter and came down hard on some data brokers. So, if you operate a payday loan generation website, it’s time to be vigilant and review your procedures to ensure you’re operating on the right side of the law.

Payday Loan Industry Lawyer

Need a lawyer with payday loan business experience? Contact Aaron Kelly. He has tons of experience with the issues short-term loan operators face.

Marketing Class Action Lawsuits: Legal Steps

marketing class action lawsuit guide

Class Action Lawsuits Part I: History

History of Class Action Litigation

Class action litigation dates all the way back to medieval England. Thanks to treacherous roads and equine-powered vehicles, it was difficult for Kings, Queens, and henchmen to travel from village to village dispensing justice. As such, dealing with legal conflicts en masse became the norm.

But things improved in jolly old England. Roads became less death-trapy; horse-and-buggy technology blew up; travel became safer and smoother. The improvements affected politics, culture, and justice. At the time, individual litigation usurped group trials.

By 1850, Parliament had enacted several statutes that took a bite out of group litigation. But at around the same time, in the United States, group litigation lived on, albeit oddly, in large part due to Supreme Court Justice, Joseph Story.

Class Action Law in the United States

Equity Rule 48 is the legal seed of modern U.S. class action litigation. Back in the day, though, 48 was largely ineffective because it didn’t allow “suits to bind similarly situated absent parties.”

Over time, Equity Rule 48 effectively became Equity Rule 38.

In 1966, class action litigation underwent another major change in the United States. The opt-out process became standard and Equity Rule 38 became Rule 23 of the Federal Rules of Civil Procedure.

Today, Class action laws in the U.S. are defined in Rule 23 of the Federal Rules of Civil Procedure and Title 28, section 1332(d) of the annotated United States Code.

For several decades, the 1966 standard remained the status quo for class action litigation.

However, things changed in the 1990s when the SCOTUS ruled in favor of bilateral arbitration over class action litigation. Capitalizing on the high court’s sentiments, in 1999, a national arbitration advocacy association launched a campaign encouraging businesses to include “collective action waivers.”

Class Actions as an Alternative to Government Finance Regulation?

Back in 1941, two well-known free market proponents — Harry Kalven, Jr. and Maurice Rosenfeld — promoted the idea that class action litigation could replace “direct government regulation” in the market.  It never worked out to the extent the pair hoped.

Class Action Lawsuits Part II: The Anatomy of A Class Action Claim

We’ve discussed the history of class action law, from its beginnings in Medieval England to its current form under U.S. statutes. Now let’s examine the administrative aspects and legal elements of a marketing class action lawsuit.

Jurisdiction and Class Action Lawsuits

Most state class action laws look a lot like the federal ones; but, inter-state differences do exist. For example: California has four different class action categories. Virginia doesn’t allow any class action suits. New York limits the types of cases that can be brought via the class action process.

Federal Class Action Eligibility

Class actions can be filed in federal court if the prevailing issue is a matter of federal law. Additionally, federal district courts may have jurisdiction is the potential damages exceed $75,000, or if a member of the class is from a different jurisdiction than the defendant.

State Class Action Eligibility

Class actions can also be brought under state law. Common wisdom says federal courts are more favorable to defendants, while plaintiffs tend to fare better in state courts.

The Class Action Fairness Act of 2005

In 2005, federal officials passed the Class Action Fairness Act (U.S.C. Sections 1332(d), 1453 and 1711-1715). A statute meant to modernize class action litigation, the law increased federal jurisdiction over class and mass action lawsuits. It also directed courts to better scrutinize the efficacy of settlements.

Like most federal statutes, The Class Action Fairness Act had its supporters and detractors. The “yay” vote appreciates the reduction of “forum shopping.” The “nay” group thinks the Class Action Fairness Act doesn’t bring balance, but instead makes it harder to bring class action lawsuits — and therefore benefits large corporations over average citizens.

Basic Timeline of a Class Action Lawsuit

You may be thinking: how does a marketing class action lawsuit actually play out? Here’s a rough timeline for a typical case:

  1. Finding and Filing a Case: Sometimes a plaintiff approaches a law firm about a potential class action lawsuit. Other times, a law firm approaches a potential client about being a named/lead plaintiff on a case.
  2. Certification: Once the case is filed, it needs to be certified as a class action lawsuit. Specifically, the parameters of the class need to be drawn, and a judge must determine if the case qualifies for group litigation. Discovery may be necessary during the class certification process.
  3. Let the Objections Begin: Once the class is certified, the defendants can voice their objections. Common arguments during this stage include:
    • Objection to the validity and feasibility of a class action to resolve the particular legal conflict at hand;
    • The appropriateness of the named plaintiff as a representative of the group;
    • The preparedness of the law firm representing the plaintiffs; and
    • The soundness of using class action litigation to rectify the legal questions at hand.
  4. Hear Ye, Hear Ye: Once objections have been made, dealt with, and the class is certified, it’s time for broadcasts. After all, you can’t very well have a class action lawsuit without a sizable class of potentially damaged victims. The first announcement announces the class and usually gives instructions on how potential members can opt out. Why would anybody want to opt out? In most cases, because an individual wants to pursue his or her own legal action against the defendant(s). If the named plaintiff, defendants and attorneys can hammer out a settlement before the case is heard by a judge or jury, a settlement notice must also be published to the public.
  5. Kumbaya Achieved: If a settlement is immediately proposed, accepted and approved, then the class action is essentially over and the parties execute their portion of the settlement agreement. In these instances, the class members can collect whatever reward at his point. If a settlement is not proposed, accepted and approved, the case may go to trial – which could take years. Eventually, a judge rules and the resulting orders carried out as prescribed by the ruling.

CAN’T Principle: The Four Pillars Of A Class Action Claim

When describing class action lawsuits, the acronym “CAN’T” is used to remember the aspects of a class action lawsuit.

Commonality: In order for an action to move forward, the members of a given class must have the same legal issue with the same set of defendants. Moreover, the common issue must usurp any singular issues any individual class member may have with the defendant(s).

Adequacy: A certified class largely depends on the preparedness of the plaintiffs’ law firm. The courts won’t let just any attorney handle a class action case, as group litigation requires significant resources and knowledge of class action proceedings. Same goes for the other side.

Numbers: Size matters in class action lawsuits. For a case to be green lit, the number of people in the class must be large enough that litigating each case separately would be unreasonable.

Typicality: Like any lawsuit, class action cases must use laws and arguments relevant to the issue(s) at hand.

Advantages of a Class Action Lawsuit

  1. Can increase efficiency of legal process;
  2. Can lower litigation costs;
  3. Eliminates redundant trials;
  4. The structure of a class action creates a worthwhile opportunity to hold a company accountable;
  5. Disallows early-filing plaintiffs from “raiding the fund” in “limited fund” cases;
  6. Can mitigate legal confusion, as there is less opportunity for incompatible standards.

Disadvantages of Class Action Lawsuits

  1. In certain circumstances, class actions have the potential to harm class members with legitimate claims;
  2. Class actions have the potential to adversely affect interstate commerce;
  3. Have the potential to undermine the public’s respect for the judicial system;
  4. The notification system is often confusing and inefficient;
  5. If the stars are aligned, participants in competing cases can orchestrate collusive settlement discussions.

Class Action Lawsuits Part III: Marketing Class Action Lawsuit Briefs

SunRun Class Action Lawsuit

In January 2013, California resident Shawn Reed filed a lawsuit against SunRun, a solar panel company. Reed alleged deceptive marketing, citing inaccurate information allegedly conveyed by both the company’s marketing materials and a sales representative. Specifically, Reed “understood from SunRun that increases in electricity prices would result in the cost advantage of the SunRun system.”

Reed was skeptical of the claims and researched the issue. His findings meshed with SunRun’s. Specifically, Reed concluded that while electricity rates were on the rise, they were increasing at the rate SunRun said.

But the discrepancy in electricity rates was the only problem Reed had with SunRun. He also took issue with the termination clause in the contract that said consumers could cancel without penalty if they move. Yet, further down the contract, it says customers must pay the remainder of the lease if the contract is terminated. The contradiction bothered Reed because, in his opinion, it was “unnecessarily confusing to the average consumer” and “likely to deceive” customers. Firm in his convictions, Reed launched a lawsuit.

In their defense, SunRun argued lack of intent, reasoning that the company wasn’t “intentionally deceptive” – a requirement for a successful false advertising action.

Reed won the first round and a judge certified his proposed class: anyone who entered into a contract with SunRun before February 2012.

The case is currently ongoing. Reed v. SunRun Inc., Case No. BC498002, California Superior, County of Los Angeles

Kodak Class Action

Printer companies seem especially vulnerable to marketing class actions. Take Kodak.

Consumers realized that printing black and white documents used up a significant amount of color ink, which ranslated into extra costs for the consumer. As a result, affected parties launched a class action; lead plaintiff: Daniela Apostol.

The process started in Sept 2011. The class alleged violations of the Consumers Legal Remedies Act and unfair competition laws, in addition to false advertising and unjust enrichment. The lawsuit states: “Kodak represents that its 10B black inkjet print cartridges will yield approximately 425 pages, but Kodak does not advertise that to print 425 pages of black text and graphics, a significant and a substantial amount of color will also be used…”

The proposed member class is anyone in the United States who owns a Kodak color inkjet printer and has printed black text or images using that printer between January 26, 2010 and September 23, 2011. At the time of this writing, the case is still pending.

HP and Epson are facing similar lawsuits.

Webloyalty Class Action Case

The Webloyalty class action lawsuit deals with unauthorized credit card charges. Plaintiffs in the case allege deceptive Internet marketing and selling strategies.

It all started in 2006. Webloyalty was running a fee-based travel membership club called “Reservation Rewards” that conferred discounts on participants. The problem (according to plaintiffs)? Webloyalty allegedly enrolled people without their knowledge, didn’t honor cancellation requests, and unlawfully obtained consumers’ billing information.

A judge certified the class membership and the class won. The order allowed affected parties to recover up to 100% of unauthorized charges for enrollment in any Webloyalty membership programs. In addition, Webloyalty had to make significant changes to its disclosures and post-enrollment notifications. The court’s order went into effect on august 14, 2009.

Target Class Action

The Target screen-reader lawsuit centers on website accessibility.

In 2006, Bruce Sexton, Jr. – a blind student at the University at California-Berkeley – in association with the National Federation of the Blind – filed a lawsuit against Target stores because the company’s corporate website used image maps and was, therefore, inaccessible to blind people, thus violating the American’s with Disabilities Act. In addition, the plaintiffs argued violations of California’s Unruh Civil Rights Act and the California Disabled Persons Act. The addition of the California-specific claims gave plaintiffs more wiggle room: if the case didn’t fly on the federal level, it had a shot on the state level.

A California court certified the class as “all blind internet users throughout the United States who have tried without success to access Target’s website.” The judge also certified a second class: blind Californians who have tried without success to access Target.com.

When the Target caught wind of the class action, it acted quickly to change its site. But, the case moved forward anyway. In the end, the plaintiffs won.

Payment Card Interchange Fee Merchant Discount Antitrust Litigation

A 2005 class action lawsuit examined price fixing and other anti-competitive practices in the credit card industry. A complex case, its been chugging on for over 7 years. And it’s no wonder this class action is moving at a snail’s pace; Visa, Mastercard and most of the large credit-card issuing banks like JPMorgan Chase, BOA, CitiBank, Wells Fargo, and Capital One are involved.

So what’s the central issue of this seemingly never-ending case? The plaintiffs contend the defendants (credit card companies and other financial institutions) conspired to fix swipe fees for credit and other types of money cards. The plaintiffs argue that doing such hindered their ability to promote alternative payment methods (cash, checks, lower-cost cards).

After considerable litigation, attorneys for the two sides struck a deal: the card companies would reduce the swipe fee charges by 0.1% for 8 months. The reduction would translate to a $7.25 billion settlement if all class members accepted. In addition, the settlement draft gave vendors permission to pass the cost to consumers by charging a fee to buyers as a way to recoup swipe fees. Many of the larger retailers, like Target and Walmart, however, didn’t implement the consumer surcharges, fearing a PR backlash.

After reviewing the settlement offer, the National Association of Convenience Stores and the National Retail Federation came out against the deal. One of the main complaints is that consumers, not the stores,  pay the price under the proposed settlement.

Several larger retailers (Walgreens, Kroger, and Safeway) reached a separate agreement with the defendants regarding this matter.

Lane v. Facebook Class Action

Lane v. Facebook deals with Internet privacy and social media advertising.

It all began in December 2007. Facebook unleashed Beacon – an advertising plugin deployed on all user accounts. A disaster from day one, Beacon broadcasted purchases to users’ contact lists. Unfortunately for Lane, his engagement ring purchase blasted to his girlfriend. Needless to say, Beacon effectively ruined the surprise. Many other people were similarly betrayed by Beacon, and within ten days of launching, Moveon.org had gathered over 50,000 signatures from Facebook users.

Within days, Facebook terminated Beacon, but the damage was done. In short order, Lane fronted a class action lawsuit against the social networking company. The certified class: “All Facebook users that had been affected by this service and used it without their knowledge between November and December 2007.”

Specifically, the plaintiffs alleged violations of the Electronic Communications Privacy Act, Video Privacy protection Act, California Consumer Legal Remedies Act, California Computer Crime Law and Computer Fraud and Abuse Act.

In the end, the court sided with the class. The ruling, however, proved controversial because some people felt Facebook got off too easily. The court ordered the social media behemoth to put $9.5 million towards a privacy and security research project – a project from which Facebook arguably benefited — but the users got zilch.

Swift v. Zynga

In 2009, an important online advertising class action lawsuit formed. Zynga, a developer of online games like Farmville, Mafia wars, YoVille!, and ZyngaPoker, ran ads on Facebook. Since many of their games use virtual currency, some Zynga ads promoted a game currency offer.

But according to Rebecca Swift, an avid Zynga player, the gaming company was not playing fair when it came to their advertising. When Swift provided her cell phone number in response to an ad she saw on Facebook offering YoVille! cash, she was charged $9.99 without her knowledge or consent. In the same year, Swift also signed up for another Zynga-related offer for “risk-free Green Tea Purity Trial.” As Swift understood the deal, she would receive YoCash in exchange for participating in a risk-free trial. According to the ad, she could cancel in 15 days without penalty. So Swift gave her debit card information and agreed to a shipping and handling charge. After she received the Green Tea and pills, 10 days in, she sent an email asking to cancel her subscription.

But apparently her attempt to cancel the membership didn’t work. On July 4, Swift got a message that said she would be charged $79.95 for the package of teas and pills. The notification did not include contact information for someone she could talk to about her cancellation. On July 6th, Swift was billed $79.95, in addition to a foreign transaction fee. On July 20th, without warning, she was once again billed $79.95, for a total of 176.56.

In November 2009, a class sued Zynga, Zynga’s partner Adknowledge, and Facebook; Swift, the lead plaintiff. The suit alleged violations of the unfair competition law and consumer legal remedies act plus unjust enrichment. According to the claim, the defendants purposefully created and distributed “highly misleading ads.”

When word of the lawsuit broke, pundits assumed that Facebook and Zynga would probably enjoy immunity. Swift took notice of the criticisms and removed the two companies from the suit, but without prejudice.

While Swift and company were busy planning their strategies, Zynga and Adknowledge separately tried to get the case dismissed on Section 230 grounds, but the courts denied the requests, evoking the Roomates.com ruling. Ultimately the judges determined that Swift’s allegations could support the conclusion that Adknowledge was responsible for creating or developing the content and Zynga further contributed to their development by specifying the design, layout, and format of the offers.

In the end, despite pulling all its “offer” based advertising in 2009, Zynga promptly reinstated the practice in 2010.

At the time of this writing, litigation is still ongoing.

Fraley, et al. v. Facebook, Inc., et al class action

Another marketing class action lawsuit out of California, Fraley, et al. v. Facebook dealt with alleged “misappropriation” of Facebook users’ names and images in “sponsored story” advertisements. Plaintiffs first filed the case in March 2011. Judge Lucy H. Koh presided.

Judge Koh eventually granted Facebook’s motion, but only in part; the plaintiffs continued. Miraculously, however, in May 2012, right before the certification hearing and just after Facebook went public, the two parties reached a settlement: 10 non-profits would get $10 million to establish a “privacy in advertising” research project. Facebook also agreed gave users more control over their appearances in advertisements.

Interestingly, Koh recused herself from the case one day before the settlement was scheduled. Richard G. Seeborg assumed the case. He ultimately denied settlement, taking issue with the “propriety of a settlement that provides no monetary relief directly to class members.” He also didn’t understand how the parties arrived at the $10M figure. Moreover, the “clear sailing” proposal that would allow attorneys to collect $10M from the court, unopposed, didn’t sit well with Seeborg.

Upon the judge’s rejection, lawyers went back to the drawing board. As the judge strongly suggested, they removed the “clear sailing” provision. In addition, lawyers beefed up the language involving minors’ ability to control their likeness in advertisements. By December 2012, the preliminary settlement was amended, approved, and the class membership defined as:

All persons in the United States who have or have had a Facebook account at any time and had their names, nicknames, pseudonyms, profile pictures, photographs, likenesses, or identities displayed in a Sponsored Story at any time on or before the date of entry of the Preliminary Approval Order.

Additionally, a Minor Subclass defined as:

All persons in the Class who additionally have or have had a Facebook account at any time and had their names, nicknames, pseudonyms, profile pictures, photographs, likenesses, or identities displayed in a Sponsored Story, while under eighteen (18) years of age, or under any other applicable age of majority, at any time on or before the date of entry of the Preliminary Approval Order.

Recently, a proposed settlement called for a $20M fund. A fairness hearing was held in San Francisco on June 28, 2013. At the time of this writing, Seeborg is expected to approve the settlement.

Qihoo v. Tencent: China’s Big Internet Law Battle

picture of Chinese cell phone apps to accompany post about Qihoo v. Tencent legal sagaA high-profile Internet law case is hogging headlines in China. Qihoo 360 Technology Co. Ltd (“Qihoo”) and Tencent, the world’s 3rd largest Internet company behind Amazon and Google, have been entangled in a longtime legal battle. Think of Qihoo v. Tencent as the Google antitrust saga – Eastern Hemisphere edition.

About Tencent

Arguably the Google of China, Tencent has its tentacles in nearly every facet of Internet business. Valued at US$101B in 2013, the ISP handles approximately 90% of China’s instant messaging traffic. The company’s mascot — a penguin with a red scarf — is as ubiquitous in China as the Nike swoosh is in the United States.

2010: Qihoo v. Tencent, Rivalry Origins

In September 2010 Qihoo sued Tencent for allegedly breaching users’ privacy via QQ Doctor – a Tencent security packet for the company’s popular IM service. Qihoo insists Tencent used QQ Doctor to scan and monitor users’ personal data.

Pundits quickly commented on the timing of the lawsuit, which coincided with the launch of Qihoo’s Koukou Guard, a security package meant to compete with QQ Doctor.

In the wake of the claim — in the name of “users’ rights” — Tencent shut down its instant messaging app on computers running Quihoo’s security package.

From that point, it was game on between Tencent and Qihoo. At one point, the Ministry of Industry and Information Technology warned both sides to curb the antics, or else.

And they complied. Things  quieted down, for a bit.

But when Qihoo released Koukou Guard, Tencent released a provocative statement, insinuating that Qihoo’s new security product would break Tencent products. Qihoo swears it lost $135 million on account of the statement.

2012: Let The Qihoo v. Tencent Battle Continue!

About Qihoo 360

Founded in 2005, and a fierce competitor of Tencent, Qihoo is another Chinese ISP that runs a Web browser and several popular apps.

Fast Forward to November 2012, Qihoo, revived its legal beef with Tencent, over the same issue.

This time, Qihoo accused Tencent of abusing its market position with the Koukou Guard announcement. Unfortunately for Qihoo, the Guangdong High People’s Court rejected the case.

Undeterred, Qihoo turned to the Supreme People’s Court. At the beginning of this month, both sides made arguments. Now, the Supreme People’s justices must deliberate and ultimately rule on the definition of “Internet Marketplace.”

One of The First Big Monopoly Lawsuits Since China’s 2008 Anti-Monopoly Law

The Qihoo versus Tencent showdown is significant for two reasons. First, the impact it could have on international Internet law is huge. Secondly, it’s one of the first major online monopoly cases heard since China passed its 2008 anti-trust law.

A law Professor at Peking University explained that Chinese anti-trust law considers 3 elements whether or not:

  1. An entity is unfairly blocking competitors;
  2. Government intervention is a factor;
  3. An industry’s barriers to entry are low.

If Qihoo v. Tencent resolves like the Google monopoly investigation, Tencent will suffer a slap on the wrist and a stern warning. If the Supreme People’s Court sides with Qihoo, perhaps Chinese technology companies will start seeking greener pastures to grow.

Blogger Defamation: Help! I Can’t Afford A Lawyer!

blogger defamationAccording to the Media Law Resource Center, courts have handed down $17.4 to plaintiffs defamed by bloggers, over the past several years. As a blogger, you may be thinking: “I’m being sued for blogger defamation, but I don’t have the money to defend myself. Do I have options?” Let’s discuss.

Represent Yourself In A Blogger Defamation Case

If you can’t afford an attorney, you can always represent yourself (pro se). If you go this route consider this link, this link, and this link.

When you represent yourself, it’s not a bad idea to consult an attorney before heading into court. An hour consultation won’t break the bank, and it could save you from losing over a simple error.

Check If Your Insurance Covers Legal Fees

Believe it or not, some insurance policies cover lawyers’ fees. Typically, standard homeowner’s insurance packages don’t cover blogger defamation lawsuit costs, but “excess liability” packages often do.

Additionally, some insurance providers will cover legal costs via homeowner’s insurance if the insured party pays an additional $200 to $350 annually. Check with your provider to see if it offers such a deal.

Another caveat enforced by some insurance companies: No coverage for intentional acts or business websites.

Many bloggers procure affordable legal insurance through blogging associations. If you belong to one, inquire. If you don’t belong to one, consider doing so.

You May Be Able To Afford Legal Counsel

Don’t underestimate your ability to afford an attorney. For starters, your situation may not require lots of litigation. In fact, a simple letter may do the trick – and that won’t cost you much. Moreover, if you have a “can’t lose” case, your opponent could very well be ordered to pay your legal fees.

If you want to consult a blogger defamation lawyer, contact Aaron Kelly.

UK Online Defamation Notice and Takedown Rules

UK online defamation notice and takedown procedureBelow is a “just the facts” rundown of the UK online defamation notice and takedown procedure.

2013 UK Online Defamation Law: The Website Operator Defense

Section 5 of the 2013 UK defamation law outlines a defense for website operators similar to safe harbor protections afforded under United States Section 230 of the Communications Decency Act.

The UK Section 5 defense can be defeated if:

  1. The website operator can’t prove who posted the offending statement; or
  2. The website operator fails to follow notice and takedown procedure.

Below is a step-by-step outline of the UK online defamation notice and takedown procedure.

UK Online Defamation Notice and Takedown Procedure Step #1: Sending A Complaint & Notifying The Poster

A takedown complainant must include the following information:

  1. Name and email address;
  2. Statement in question and why its defamatory;
  3. Explanation of the meaning the claimant derives from statement;
  4. Explanation of the exact unsupported false statements of fact or opinion;
  5. Where statement is posted;
  6. Explanation of why the claimant can’t contact the poster directly;
  7. Statement of whether or not the claimant consents to his or her name and email being released to the poster.

Incomplete Complaint Notices

If a website operator receives an inaccurate or incomplete notice of complaint, he or she must still treat it like a valid notice. Additionally, website operators only have 48 hours to inform the complainant that his or her notice is insufficient and why.

Defense Busting Opportunity: Failed To Respond In A Timely Manner

If the complainant mounts a defense against a website operator for not complying with the notice and takedown system, the complainant must prove the website operator didn’t respond in a sufficient amount of time.

UK Online Defamation Notice and Takedown Procedure Step #2: Website Operator Alerts Poster of the Complaint

Operators have 48 business hours to inform posters of a complaint. However, courts have the authority to say whether or not a notification was executed in an adequate time frame.

If the website operator can’t contact the poster, he or she must remove the material in question. Additionally, the operator must notify the complainant within 48 hours that the material was removed because the poster couldn’t be reached.

If the poster can be reached, the operator has 48 hours to:

  1. Alert the poster by sending a modified version of the notice, which redacts the name and email of the complainant if the complaint indicated that they did not want to be known to the poster.
  2. Inform poster of the 5-day deadline for response and warn of removal if he or she doesn’t reply. The website operator must also explain that the poster has two options:
    • Consent to removal; or
    • Object to removal, in which case the poster must provide a name and postal address, regardless of whether or not he or she consents to having their contact information passed on to the complainant.
  3. Write a statement indicating that he or she will not reveal the poster’s contact information unless the poster consented to do so or court ordered.
  4. Send the complainant a written acknowledgement explaining:
    • If the statement was taken down;
    • How the complaint was communicated to the poster

Defense Busting Opportunity: Failed To Collect Poster’s Contact Information

Perhaps the most dubious aspect of the UK online defamation notice and takedown system is the user contact requirement. If a website operator doesn’t maintain proper records, so to speak, the “bad books” become grounds for invalidating the operator’s defense.

UK Online Defamation Notice and Takedown Procedure Step #3: Poster Tells Website Operator To Keep or Remove Statement

Posters have until midnight at the end of the day specified in the notification to respond, “which must be the 5th day after the notification is sent.” The five-day period does include weekend and bank holidays.

When contacted by a website operator, the original poster has three options:

  1. Ignore;
  2. Instruct the website operator to remove the offending statement;
  3. Instruct the website operator to keep the statement up.

If the poster ignores the notice, the website operator must remove the material. If the poster instructs the website operator not to remove the statement, but refuses to reveal his or her contact information to the website operator, then the website operator must remove the material.

UK Online Defamation Notice and Takedown Procedure Step #4: Website Operator Analyzes Poster Response and Notifies Claimant

If the poster doesn’t provide the proper information, or “the operator believes [the information provided] is obviously false,” the operator must take down statements and notify the claimant within 48 hours.

If the poster agrees to take down statements, but the claimant wants to pursue action, the claimant must apply for a court order to get the poster’s contact information from the website operator. The website operator is required to have the information on hand, but they are not required to hand it over unless a court so orders.

If the poster says, “keep it up,” then the operator must hand over the poster’s contact information if he or she consented to its release. If the poster refuses to reveal their identity to the claimant, the claimant must obtain a court order if he or she wants to pursue the matter.

UK Online Defamation Notice and Takedown Procedure Step #5: Actions For Repeat Offenders

If the same poster makes similar comments on the same website repeatedly, and one round of takedown request has already occurred, then the website operator must remove the comments – regardless of whether or not a formal complaint is sent – within 48 hours.

If all goes according to plan, under the new UK defamation law, the longest a potentially defamatory statement can remain online is nine days.

India’s Big Political Defamation Case

An online defamation lawsuit out of India is making international headlines.
An online defamation lawsuit out of India is making international headlines.

Our discussions about international defamation cases usually revolve around the United Kingdom and Canada. But today we’re taking a quick trip to another part of the Commonwealth, India.

A political defamation saga with online implications, the case between the Aam Aadmi Party and two media outlets – India TV and Media Sarkar – is making headlines. (Rob Ford who!?)

Sting Operation Video Results In Defamation Lawsuit

The defamation debacle started when Media Sarkar (think The Huffington Post of India) orchestrated a sting operation against the  AAP party. If you believe Media Sarkar, the video showed an AAP member knowingly accepting “black money” as a campaign contribution.

Needless to say, Media Sarkar posted the footage online and India TV aired it.

WHAT IS BLACK MONEY?

“Black money” is money made on the black market. Since it’s not procured legally, it’s also not taxed. Black money is a big problem in India. It’s estimated that Indian citizens have a cumulative $2 billion in black money currently being held in Swiss bank accounts.

A he-said, she-said hubbub soon followed. Representatives from the AAP insisted the copy of the hidden camera video provided by the Election Commission was different from the one that aired on India TV. In other words, the AAP swears the media outlets altered the footage, and that the video did not “depict the AAP or its candidate indulging in any kind of illegal activities.”

So now the AAP is suing Media Sarkar and India TV. To make matters more complicated, the head of Media Sarkar filed a defamation counterclaim against the AAP over disparaging SMS comments made by party supporters.

Yes sir-e, a defamation stew is surely a’brewing. We’ll be keeping our eyes on this one.

More International Defamation Law

If you want to learn more about international defamation laws, click on over to our International Defamation Law Database. If you need an international defamation law attorney, get in touch.

Arizona’s AG Sued Citizens: Deserved or Dumb Move?

Arizona Seal
Arizona’s AG is on a defamation warpath.

Arizona Attorney General Tom Horne is crying defamation. The state’s polarizing legal chief filed an action against the Arizona Public Integrity Alliance (AZPIA) – a watchdog organization – over an advertisement on the group’s Facebook page. In the ad, AZPIA claimed Horne was under investigation by the FBI. It also highlighted Horne’s alleged failure to remunerate a $400,000 fine handed down for inappropriate campaign fundraising.

Horne insists, however, that the group has their facts wrong. The attorney general points out that, technically, he is no longer the subject of an FBI investigation. As a result, he’s suing for defamation.

Questionably, Horne filed as a private citizen despite being a public official. Can he do that? Yes, he can. But the question is: will it work?

Horne Is An Attorney General; Can He Claim To Be A Private Person For The Purposes of This Defamation Suit?

Under Arizona defamation law, the standard for defamation is different for public and private figures. In short, public figures (celebrities, elected officials, high-ranking government executives, etc.) must satisfy the actual malice standard to win defamation suits – meaning the “famous” plaintiff must prove the defendant knowingly lied or acted with reckless disregard for the truth.

The criticism under review, however, was about Horne’s tenure as attorney general. So, the court may not accept him filing as a private figure.

In the United States, political heckling is practically a national sport; heck, a national solemnity. As such, it’s tough to see how a judge will allow Horne to present his case as a private citizen.

Can Horne Win This Defamation Case?

If a judge doesn’t dismiss the case, does Horne have a shot at winning? It’s iffy. If he can prove material loss that resulted directly from a false statement of fact made in the ad, then sure, he’s got a shot. That said, the statement under review must be materially false, not just a small error. Also dampening the AG’s chances is the fact that Horne tangled with FBI at one point. Moreover, AZPIA did make an effort to remove the material in question after Horne contacted the group and explained the error.

But, you never know. We’ve not been able to read the actual filing, so it’s impossible to weigh in on the merits of Horne’s case. But judging from available media reports, this one may be an uphill battle for the plaintiff.

Update: The case went nowhere. Apparently, Horne dropped it.