IP Law Blog

By Jeffrey Pietsch

Google may soon be facing an expensive and damaging class action lawsuit. A federal court ruled last month that Google can be sued for its role in serving ads on websites that use domain names that violate trademark and cybersquatting laws. This case is significant because Google is not the owner or user of the infringing domain names. Google is simply providing advertising services to these domain names. Google, seeking dismissal of the case, argued along these lines. The court, however, held that Google may be liable for cybersquatting.

By Dale C. Campbell

Lawyers can’t turn around without being bombarded with CLE brochures announcing yet another e-discovery workshop. Electronic discovery is a new medium for storing information, but the time-tested rules concerning an attorney’s ethical duty to the court and opposing counsel in connection with discovery have not changed. On January 7, 2008, Magistrate Judge Barbara L. Major on the United States District Court, Southern District of California, issued an order granting sanctions against Qualcomm Incorporated and several of its attorneys in connection with discovery abuses. (See Qualcomm Incorporated v. Broadcom Corporation, U.S.D.C., S.D. Cal. Case No. 05-CV-1958-B (BLM). The Qualcomm decision commands the attention of all corporate counsel and litigators involved in the discovery process. As stated by Magistrate Judge Major, the decision “provide[s] a roadmap to assist counsel and corporate clients in complying with their ethical and discovery obligations and conducting the requisite ‘reasonable inquiry.’”

By Scott Hervey

Just how valuable are baseball statistics? Apparently very valuable. In fact, baseball statistics are so valuable that CBC Distribution and Marketing, which has run the CDM Fantasy Sports leagues since 1992, sued Major League Baseball and challenged its ownership claim over player statistics.   In a matter which rose all the way to the United States Court of Appeals for the 8^th Circuit, CBC agued that baseball statistics become historical facts as soon as a game is over, and that it shouldn’t have to pay for the right to use them. Major League Baseball claimed that the right of publicity belonging to major league baseball players makes it illegal for fantasy leagues to commercially exploit the statistical profiles of its players.

By Scott Cameron

Has eBay become so powerful that it can successfully claim to be the only “Bay” on the Internet? That’s what it argued in a recent Ninth Circuit Court of Appeals trademark infringement case. In that case, Perfumebay.com, Inc. v. eBay, Inc., - - - F.3d - - - (9^th Cir. November 5, 2007), the court upheld a federal district court decision from the Central District of California which ruled that the term “PerfumeBay” and “perfumebay.com” infringed the mark of Internet giant eBay. 

By Jeff Pietsch

Earlier this month, a California district court certified a class on behalf of blind internet users against Target.com under the American Disabilities Act and California law. National Federation of the Blind v. Target Corp. (N.D. Cal. Sept. 28, 2007). The class claims that the Target.com website is inaccessible to the blind and therefore violates federal and state laws prohibiting discrimination against the disabled. This ruling should give notice to website owners that websites, especially those available in California, should be made to be accessible to the blind.

By Scott Hervey

It's not uncommon for companies to change or modify the terms under which they provide services to consumers. This is true whether the company is a traditional brick and mortar company or Internet based.   When traditional companies make a change to service terms they usually send some type of written notice to the consumer. But for some reason this never caught on for Internet based companies. Often the Internet based Company would merely make changes to its terms of use (the contract which governs the consumers’ use of the relevant website and its services) and post the revised terms of use on its website.  In most instances, unless the user reviewed the terms of use frequently and compared the current version to the version that was posted at the time the consumer became a user of the site, the user would be unaware of any changes.

By Jeff Pietsch

On May 15, 2007, the 9^th U.S. Circuit Court of Appeals created a significant exception to the immunity granted to a website operator under 47 U.S.C. § 230 “The Communications Decency Act” (“CDA”). The court held that Roommate.com can be held liable for publishing content from member questionnaires created by using drop-down menus and distributing member profiles, but is immune from liability for publishing users’ responses to open-ended fields or questions. (Fair Housing Council of San Fernando Valley v. Roommate.com, LLC, 2007 WL 1412650 (9th Cir.). With this recent ruling, website operators will need to determine when the protection provided by the CDA for Internet services applies to its site.

By Scott Hervey

The United States District Court for the Southern District of New York rules that the downloading of a digital music file embodying a particular song does not constitute a "public performance" of that song within the meaning of the Copyright Act.  Thus, on-line music retailers need not negotiate a license with performance rights organizations like ASCAP and BMI in order to offer downloadable music files to consumers.

The opinion is available here

By James Kachmar

On March 29, 2007, the Ninth Circuit issued its opinion in the case Perfect 10, Inc. v. CCBill LLC, et al. in which it attempted to clarify when immunity is available to internet service providers for copyright infringement under the Digital Millennium Copyright Act (“the DMCA”), 17 U.S.C §512. Perfect 10, the publisher of an adult magazine and a related subscription website, brought a lawsuit claiming that CCBill and CWIE violated copyright laws by providing services to other websites that posted images stolen from Perfect 10’s magazine and website. CWIE provides web hosting and related internet connectivity services to the owners of various websites. CCBill allows customers to use credit cards or checks to pay for subscriptions or memberships to various websites. The U.S. District Court granted summary judgment in favor of CCBill and CWIE as to the copyright claims finding that they qualified for the “safe harbor” provisions from copyright infringement liability under the DMCA. 

By Dale Campbell

When can you knowingly republish defamatory statements without risk of liability? When you do so on the Internet. 

The California Supreme Court, in Barrett v. Rosenthal (November 2006) 40 Cal.App.4^th 33, followed the line of federal cases interpreting the Communications Decency Act of 1996 (CDA) to find broad immunity for both Internet service providers and users of an interactive computer service for republishing defamatory statements. 

By Jeff Pietsch

Last week Keith Urban, the Grammy nominated country singer from Australia, sued Keith Urban, a New Jersey painter, for use of the website www.keithurban.com. The suit filed in federal court alleges that Keith Urban, the painter, is infringing on the singer’s trademark rights by misleading internet users into believing that the website is owned by the singer. The website, which has been owned and registered by the painter since 1999, sells oil paintings through the website. Upon entering the site users see the following: “You have reached the site of Keith Urban. To those who don’t know, oil painting is one of my hobbies.” Users are then directed to a link which displays several paintings. The singer claims this use infringes on the Keith Urban trademark by violating the Anticybersquatting Consumer Protection Act, the Federal Trademark Dilution Act, and federal unfair competition laws. This article will examine the claims against the painter under the Anticybersquatting Consumer Protection Act.

By Jeffrey Pietsch

In 2006, Federal District Courts throughout the country were asked to decide if purchasing and using trademark-protected keywords to trigger internet advertising constitute trademark violations as contemplated by the Lanham Act. Unfortunately for advertisers, these rulings were inconsistent. In 2007, this trend continues with the Eastern District of Pennsylvania ruling in J.G. Wentworth v. Settlement Funding, LLC, No. 06-0597 (E.D. Pa. Jan. 4, 2007). In J.G. Wentworth, the court siding with advertisers, ruled that using trademark-protected words to trigger internet advertising does not violate trademark law.

By James Kachmar

          A California appellate court affirmed last month that an employer is entitled to immunity from tort liability for threatening emails sent on or through the employer’s internet/email system by one of its employees. On December 14, 2006, the Sixth Appellate District in the case Delfino v. Agilent Technologies, Inc., 2006 WL3635399, affirmed summary judgment in Agilent’s favor finding that Agilent, as an employer, was immune from tort liability under the Communications Decency Act of 1996 (“CDA”) for threatening emails sent and posted by one of its employees. This case, apparently one of first impression, extended the immunity protections of the CDA to cover corporate employers who provide their employees with internet access through internal computer systems. Employers thus have additional protection from claims that their employees have used the employer’s computer system to commit torts against third persons.

By April Hiroshima Gatling

          This month, a United States District Court ruled that retailer Land’s End will get a trial in a case where defendant website owners are accused of profiting from the company’s online affiliate program through a scheme that gave “typosquatting” a new twist.

          “Typosquatting” is a form of cybersquatting that relies on typographical mistakes made by Internet users when inputting a website address into a web browser. Most typosquatters are either in the practice of tricking or diverting Internet users to alternative websites or attempting to sell the domain name back to the trademark owner.         In this case, however, defendants directed Internet users to the Land’s End’s website, but only after channeling them through “affiliate” sites owned by defendants, who in turn received commissions associated with subsequent purchases.

By Scott Hervey

On June 27, 2005, the United States Supreme Court handed down its decision in MGM v. Grokster.#160 That case involved an appeal from the Ninth Circuit by MGM, various record labels and other content owners of an adverse decision in their attempt to hold Grokster and other peer-to-peer network companies liable for copyright infringement.#160 MGM and the other content owners had initially filed a lawsuit against Grokster and other peer-to-peer network technology companies to hold them liable for damages resulting from their supplying the technology that enabled users to trade online copyrighted works.#160 The Ninth Circuit, upholding the District Court's finding, held that the technology companies could not be held either vicariously liable or liable for contributory copyright infringement.#160 In coming to its conclusion, the Ninth Circuit interpreted the Sony v. Betamax case in holding that the distribution of a commercial product capable of substantial noninfringing uses could not give rise to contributory liability for infringement unless the distributor had actual knowledge of specific instances of infringement and failed to act on that knowledge.#160 Because the Ninth Circuit found the technology company's software to be capable of substantial noninfringing uses and because respondents had no actual knowledge of infringement resulting from the software's decentralized architecture, the court held that they were not liable.#160 (The architecture of the defendant's file trading network is an open network.#160 That is, it does not have a central server like the old Napster network but rather uses nodes and supernodes; computer systems that are owned by users of the software and have no relationship to the defendants.)#160 The Ninth Circuit also held that the defendants did not materially contribute to their user's infringement because the users themselves searched for, retrieved and stored the infringing files, with no involvement by respondents beyond providing the software in the first place.#160 Finally, the court held that the defendants could not be held liable under a vicarious infringement theory because the defendants did not monitor or control the software use and had no agreed upon right or current ability to supervise its use and had no independent duty to police infringement

The United States Supreme Court held on Monday that Internet file-sharing services will be liable for copyright infringement if they intend for their customers to use their software primarily to engage in illegal downloading.

Read the full opinion here:#160 Download grokst1.pdf

By Scott Hervey

Podcasting is a way of publishing sound files to the Internet, and delivering the files to users who subscribe to a feed.#160 Podcasting uses a distinct content delivery protocal that has enabled many producers to create self-published "radio shows" that users can subscribe to and have delivered directly to their computer via one of a number of content aggregators.#160

Podcasts are technologically unlike webcasting or streaming. Webcasting is an Internet stream of a live broadcast, or an online simulcast of a broadcast signal.#160 Streaming is a technological means for accessing a stream of electronic information at the same time it is delivered to a user's computer.#160 Neither webcasting nor streaming result in the creation of an audio file on the Internet user's computer.#160 Podcasting however, involves the downloading of a single complete audio file to a user's computer to be listened to at a later time.

Like blogs, podcasting has been adopted both by amatures who want to host their own "radio show" and by professionals who see podcasting as an inexpensive way to distribute content.#160 Podcasting is not the realm of techno geeks or Internet extremists.#160 Mainstream broadcasting and media companies have realized the benefit of podcasting.#160 National Public Radio offers podcasts of most of its shows, and Infinity broadcasting network announced plans to launch a pure podcast radio station.#160 ABC is even offering podcasts of Nightline and Good Morning America.#160 Despite Corporate America quickly embracing this new technology, the majority of podcasts being offered today are from individuals and small businesses.

One of the quickest ways for a podcaster to get into hot water is to infringe a third party's copyright.#160 #160A number of music podcasts are produced by DJ's or independent record labels that use their podcast programs as a means of promoting other artists.#160 Most of these podcasts have a "mixed tape" quality to them, especially in the dance, hip-hop and rap genres.#160 Other podcasts are produced by music fans who may be interested in a certain style or type of music.#160 For example, one more popular podcast, Coverville, focuses entirely on covers songs.#160 If a podcast includes music and the podcaster has not obtained all the necessary rights, copyright infringement will result.#160 The real problem is for podcasters who want to stay out of the RIAA's crosshairs, determining exactly what type of license to get can be challenging.

Copyright law implications in music can become very confusing, very quickly.#160 Copyright law provides the copyright owner with the following rights:#160 the right to control the public performance of its copyrighted work; the right to control the production and distribution of a sound recording embodying a copyrighted work; and the right to create a copy of a sound recording.#160 Each of these rights may be implicated in podcasting.#160

Performance right organizations (PRO), such as BMI, ASCAP and SESAC license the public performance of copyrighted work.#160 Usually a license from all three is recommended because each organization represents different publishers of musical works.#160 #160Performance rights organizations have staked a claim to the right to license music for podcasting.#160 On its website, BMI claims that it has "been licensing podcasters for nearly a year covering the public performance rights to the BMI repertoire" and lists Coverville as one of its licensees.

The right to produce and distribute a sound recording which embodies a copyrighted composition is controlled by music publishers, who have abdicated the responsibility to the Harry Fox Agency.#160 HFA collects mechanical license fees (a mechanical license covers the right to reproduce and distribute copyrighted musical compositions [i.e. songs], including uses on CDs, records, tapes, and certain digital configurations) on behalf of publishers.#160 This includes full permanent downloads, whether or not charged for.#160 Since podcasting technology results in the creation of a single digital audio file to a user's computer, HFA could rightfully claim that it is the proper agency to control licensing for podcasts.#160 While HFA has yet to make this claim, given what occurred when PROs and HFA were trying to determine who controlled the right to issue licenses for webcasting and streaming, it is only a matter of time.

It is important to note that HFA licenses cover the right to make and distribute recordings of musical compositions, and not the use of existing sound recordings.#160 In order to clear those rights, a podcaster would have to obtain permission from the owners of each sound recording, which in most cases are record labels.#160

In 1995 and again in 1999, the Copyright Act was amended to create a statutory license mechanism for the digital transmission of sound recordings and musical works.#160 The 1995 legislation covered uses like the commercial sale of MP3s, while the 1999 amendment covered webcasting and streaming.#160 The 1999 amendments allowed webcasters the right to webcast or stream copyrighted music, and required them to pay certain pre-set royalties to SoundExchange, a performance rights organization that was designated by the U.S. Copyright Office to collect and distribute statutory royalties.#160

The 1999 amendments to the Copyright Act do not provide coverage for podcasting because the statutory license only covers the transmission of a sound recording, not the distribution of a copy of it.#160 Podcasting involves the reproduction of a sound recording and results in the creation of an audio file on a user's computer.#160 As stated above, clearing the right to create a reproduction of a sound recording, not just the musical composition, necessitates approval from the record label that owns the sound recording.#160

Although BMI and ASCAP are offering performance licenses, podcasters who want to remain on the right side of the law may also need to clear rights from other parties.#160 Because there is no industry wide standard and no central clearance mechanism like SoundExchange, clearing rights to the sound recording can be rather expensive and time consuming.#160 The music industry and our lawmakers need to devise a mechanism that allows podcasters to easily comply with the law and a licensing scheme that is not financially daunting.#160 Most non-corporate podcasters, such as Coverville, fund their operation entirely out of their own pocket, or by donations from listeners.#160 There is a desire for this type of alternative music programming; a desire that is not being fulfilled by commercial radio.#160 It would be shame if red tape and licensing costs silenced these unique and interesting programs emanating from the left of the radio dial.

By Scott Hervey

Wired reports that the French judiciary has been issuing lenient sentences and penalties to individuals involved in criminal proceedings involving illegal file trading.#160 The president of the French magistrate union, Judge Dominique Barella, has openly taken the position that the harsh criminal penalties imposed under French copyright law are inappropriate under the circumstances.#160 Wired reports#160 the Barella has insisted that a more appropriate policy needs to be adopted in France and in Europe that protects what he says are mostly young people of the MP3 generation who are weak targets against the machinations of the entertainment industry's legal agenda.

The French entertainment industry is not taking Barella's position lightly.#160 In a letter to the French Minister of Justice, representatives of France's entertainment, film, music associations stated "[w]e are surprised and shocked that the president of the magistrates union, given the level of influence he has on his colleagues, can publish in the press a call to not criminally sanction criminal acts, which contradicts the intentions of government bodies."

Barella defends his position, stating that the government's resources would be better spent focusing on large scale, international counterfeiting rings instead of targeting young Parisians who just want fill their ipod.

By Scott Hervey

If consumers in Ontario, Canada purchase goods from you over your website, you have until July 30, 2005 to prepare to for compliance with Ontario's Consumer Protection Act of 2002 (CPA 2002).#160 The CPA 2002 has a very long reach, similar to California's Data Security Law (See Business Data Management Practices - Fertile Ground For Liability).#160 The CPA 2002 applies to both companies located within Ontario and companies engaging in a transaction with a resident of Ontario.

Under the CPA 2002, U.S. companies conducting business with an Ontario resident over the Internet will have to provide its name and any other name it uses to conduct business, its address, and telephone number.#160 #160The company will also have to describe the goods in a fair and accurate manner, and provide a detailed breakdown on the price charged to the consumer (cost of goods, freight, tax, etc.) and fully explain payment terms.#160 #160

Under the CPA 2002, U.S. Companies will also have to provide the Ontario resident with a copy the agreement between the parties (e.g., a purchase agreement) within 15 days and provide the purchaser with opportunity to accept or decline and to correct any errors in the agreement.

If after July 30, a U.S. company fails to comply with the CPA 2002, the Ontario purchaser will have the right to cancel the transaction within 7 days after receiving a copy of the agreement.#160 If the Ontario purchaser never receives a copy of the agreement, the purchaser then has the right to cancel the transaction within 30 days after entering into agreement.#160