Attorney Evan Brown

January 30, 2014 Copyright, Evidence, Litigation

Does publication on the web give rise to “access” in copyright infringement analysis?

Plaintiff sued defendant for copyright infringement. Defendant moved for judgment on the pleadings (which is essentially the same thing as a motion to dismiss for failure to state a claim except it is after defendant files an answer). Defendant asserted that plaintiff had not pled copyright infringement because under the Seventh Circuit’s “substantial similarity” test to demonstrate infringement, plaintiff had not pled defendant had “access” to the allegedly infringed work.

The court rejected defendant’s argument and denied the motion for judgment on the pleadings on this issue.

In some copyright infringement cases, a plaintiff may not have direct evidence that the defendant committed infringement. In those situations, a finder of fact may infer that infringement has occurred when it is shown that:

the defendant had access to the copyrighted work; and
the accused work is substantially similar to the copyrighted work.

In this case, defendant argued it never had access to plaintiff’s designs that it was alleged to have infringed. But the court considered the online publication, 11 years ago, of plaintiff’s designs, to find access for purposes of the motion for judgment on the pleadings:

With regard to online publication, in 2003, [plaintiff] first published the [allegedly infringed work] at [its website]. The Internet already was widely used and accessible at that time. Because the non-movant is entitled to reasonable favorable inferences in evaluating a motion for judgment on the pleadings, the online publication is enough to establish access for purposes of denying [defendant’s] motion for judgment on the pleadings.

The court’s decision provides no meaningful analysis as to why publication on the web gives rise to access. It states the finding above in such a conclusory manner as if to indicate it sets forth some per se rule. But one is left to wonder whether other factual nuance would change the answer to the inquiry: What if publication were in 1993 rather than 2003, at a time when many, many fewer people were on the web? What if the publication were behind a paywall for which defendant had no authorization to pass? What if defendant pled it did not utilize the web for this sort of information, or, even more compellingly, not at all?

Skyline Design, Inc. v. McGrory Glass, Inc., 2014 WL 258564 (N.D.Ill. January 23, 2014)

January 29, 2014 Computer Crime, Employment

Using new employer’s credentials to copy former employer’s technology did not violate Computer Fraud and Abuse Act

This case arose from some rather complex but interesting facts:

8e19fbd8a556c7b63610c1cfd7782f10 Defendant resigned from his job with an IT consulting firm. One of the firm’s customers hired defendant as an employee. Before the customer/new employer terminated the agreement with the IT consulting firm/former employer, defendant used the customer/new employer’s credentials to access and copy some scripts from the system. (Having the new employee and the scripts eliminated the need to have the consulting firm retained.) The firm/former employer sued under the Computer Fraud and Abuse Act. Defendants (the customer and its new employee) moved to dismiss for failure to state a claim. The court granted the motion.

It held that the complaint failed to allege “unauthorized access” within the Ninth Circuit’s interpretation of the CFAA.

The court looked to the Ninth Circuit’s holding in LVRC Holdings LLC v. Brekka, 581 F.3d 1127 (9th Cir. 2009), which provides that to access a protected computer “without authorization” is to do so “without any permission at all,” and that to “exceed authorized access” is to “access information on the computer that the person is not entitled to access.” And it looked to the more recent case of U.S. v. Nosal, 676 F.3d 854, 863 (9th Cir. 2012), which teaches that an individual does not “exceed authorized access” simply by misusing information that he or she was entitled to view for some other purpose. Under Nosal, the CFAA regulates access to data, not its use by those entitled to access it.

In this case, the court found that the complaint did not allege that defendants were unauthorized to access the scripts in question. In fact, the Statement of Work that the court reviewed specifically granted defendant’s employer and its representatives (including defendant) “sudo access” to “non-shell root commands” that included the scripts at issue.

Plaintiff argued that the access was unauthorized because it had repeatedly refused to grant defendant or his employer the authority to write or edit those scripts. But the court found that argument to address the misuse of the scripts, not unauthorized access. Under Nosal this conduct did not run afoul of the CFAA. So because the complaint failed to allege that defendant and his new employer had no access rights to the scripts, and because the documents upon which plaintiff relied revealed that defendants had certain access rights, the court dismissed the CFAA claim.

Enki Corporation v. Freedman, 2014 WL 261798 (N.D.Cal. January 23, 2014)

January 28, 2014 Copyright

Can a website be liable for linking to infringing content?

Gawker facing Grokster-like challenge in suit by Quentin Tarantino over leaked script.

gawkster The Hollywood Reporter has covered Quentin Tarantino’s copyright infringement lawsuit against Gawker for publishing links to leaked copies of the script of a yet-to-be-made Tarantino film. The complaint alleges that certain anonymous defendants are directly liable for infringement for uploading the script, and that Gawker is secondarily liable for the infringement.

Going after Gawker that way makes sense, because the site cannot be directly liable for infringement if it did not exploit any of Tarantino’s exclusive rights under Section 106 of the Copyright Act, viz.: the right to copy, distribute, publicly perform, publicly display, or make a derivative work.

None of those rights are implicated by simply publishing a link. So if Gawker is shown to be liable for copyright infringement, it will have to be derived from the direct infringement of the parties who uploaded the content, and/or the infringement occasioned by Gawker users who download the script.

These facts call for an analysis under the Supreme Court’s 2005 Grokster decision, which held that:

[O]ne who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.

The Grokster analysis gets some color in the Ninth Circuit (Tarantino’s suit is pending in federal court in California) in the 2013 case of Columbia Pictures v. Fung (the Isohunt case). In that case, the appellate court held that Isohunt was secondarily liable for the infringement occasioned by its users under the Grokster analysis. Like Gawker, Isohunt’s conduct did not implicate any of the plaintiffs’ Section 106 rights. Instead, its liability was premised on the conduct it undertook to direct users to the acquisition of infringing content.

Gawker is of course no stranger to controversy. Just last week we covered a Florida case dealing with Gawker’s First Amendment rights to publish excerpts of the Hulk Hogan sex tape. This bold move of publishing provocatively certainly continues that trend. But this time that move could face some serious Grokster-like consequences.

January 24, 2014 Computer Crime

Hunter Moore arrest reveals a certain inconsistency about the Computer Fraud and Abuse Act

The feds arrested Hunter Moore and an alleged co-conspirator on Thursday for hacking into email accounts to get nude photos Moore published on isanyoneup.com. At the heart of the prosecution is the Computer Fraud and Abuse Act, the federal statute that makes it a crime (and in some circumstances, gives rise to civil liability) for accessing a computer without authorization.

Few will come to these guys’ defense in this situation. Moore’s conduct in publishing and promoting isanyoneup.com was reprobate, and if the allegations in this criminal action prove true, that backend nefariousness will simply multiply the reasons why Moore was known as the most hated man on the internet. And because of this disdain for Moore’s conduct, most of us are happy to see the CFAA used aggressively against him.

But that’s the same statute many blame for crushing Aaron Swartz. To the extent a reasonable person may feel ill-will against Hunter Moore, he or she may feel sympathy, indeed compassion, for Aaron Swartz having had the CFAA book thrown at him. Against Moore there’s a sense of justice, against Swartz, a palpable injustice.

Isn’t it a bit mysterious how the same conduct — granted, for way different purposes and under different circumstances — can elicit such contrasting emotions?

January 23, 2014 Contracts

“Right to audit” provisions in technology services agreements can benefit both parties

About the Author: Evan Brown is a Chicago technology and intellectual property attorney. Need help? Call Evan at (630) 362-7237, send email to ebrown@internetcases.com, or follow him on Twitter @internetcases.

“Right to audit” provisions in technology services agreements are common. You’ve seen them. A typical section will read something like this:

Vendor will keep accurate and complete records and accounts pertaining to the performance of the Services. Upon no less than seven (7) days’ written notice, and no more than once per calendar year, Customer may audit, or nominate a reputable accounting firm to audit, Vendor’s records relating to its performance under this Agreement, including amounts claimed, during the term of the Agreement and for a period of three months thereafter.

These provisions often benefit the customer, to give it some transparency and assurance that the vendor is performing the services according to the agreement and that vendor is charging customer for the services appropriately.

But a right to audit provision can benefit the vendor (and go against the customer) as well. As a recent court decision shows (Carlson, Inc. v. IBM, 2013 WL 6007508 (D. Minn. November 13, 2013)), a customer’s comprehensive audit rights can preclude it from claiming that vendor owes it a fiduciary duty.

In the case, the customer sued its software vendor alleging, among other things, that the vendor breached its fiduciary duty. The customer argued that it had to essentially “hand over the keys” of its operations to the vendor. But the court ruled that vendor did not owe customer a fiduciary duty because the customer had several important rights to know about and control the vendor’s performance.

The master services agreement between the parties reserved for the customer the right to audit the vendor’s performance and challenge its pricing and delivery of services. Under the agreement, customer had:

regular and recurring access to vendor personnel;
access to complete records and supporting documentation underlying vendor’s services;
the right to conduct operational audits to examine vendor’s performance of the services;
the right to audit performance for comparison to standards in the service level agreement;
the right to financial audits to verify the accuracy and completeness of invoiced charges.

The court found that “[t]hese audit and oversight provisions [were] meaningless if [customer] was as helpless as it [claimed].”

So while vendors may find right to audit clauses to be a nuisance, they should remember that the presence of such a clause could provide an important defense in litigation over the technology agreement.

Evan Brown is a Chicago attorney helping businesses negotiate and draft technology services and development contracts. He also handles many other issues involving the internet, copyright and trademarks, and new media. Call him at (630) 362-7237 or email ebrown@internetcases.com.

January 22, 2014 First Amendment

Hulk Hogan sex tape redux: Another court holds Gawker had First Amendment right to publish video excerpts

Evan Brown is a Chicago attorney helping businesses and individuals identify and manage issues dealing with technology development, copyright, trademarks, software licensing and many other matters involving the internet and new media. Call him at (630) 362-7237 or email ebrown@internetcases.com.

As we discussed here on internetcases back in November 2012, someone surreptitiously filmed Hulk Hogan engaged in sex acts with someone other than his wife. When Gawker posted an article and video excerpts about that, Hulk sued in federal court for invasion of privacy. The federal court denied the preliminary injunction, holding that to bar Gawker from publishing the information would be an unconstitutional prior restraint on speech.

A few weeks after the federal court denied his motion for preliminary injunction, Hulk voluntarily dismissed the federal case and filed a new case in state court. Unlike the federal court, the state court granted a preliminary injunction against Gawker publishing the information and the video excerpts. Gawker sought review with the Court of Appeal of Florida. On appeal, the court reversed the lower court’s order granting the preliminary injunction.

The state appellate court’s decision closely tracked the federal court’s reasoning from 2012. The court observed that where matters of purely private significance are at issue, First Amendment protections are often less rigorous. But speech on matters of public concern is “at the heart of the First Amendment’s protection.”

The court found that the sex tape excerpts and information that Gawker published were matters of public concern. Much of this was from Hulk’s own doing — he injected himself into the public spotlight not only as a professional wrestler, but also through books detailing his sexual indiscretions, radio interviews, and other public pronouncements about his “conquests.”

In arguing that Gawker’s speech was not of public concern, Hulk looked to Michaels v. Internet Entertainment Group, Inc., 5 F.Supp.2d 823 (C.D.Cal.1998), a case that dealt with the infamous sex tape that Bret Michaels and Pamela Anderson made. In that case, the court found defendant’s redistribution of the video was not protected by the First Amendment, in part because the distribution was purely commercial. The court didn’t buy it.

But wasn’t Gawker’s use commercial as well? The court drew a distinction:

We are aware that Gawker Media is likely to profit indirectly from publishing the report with video excerpts to the extent that it increases traffic to Gawker Media’s website. However, this is distinguishable from selling the [Hulk] Sex Tape purely for commercial purposes.

So the court found that despite his brawn, Hulk failed to carry his “heavy burden” of overcoming the presumption that a preliminary injunction would violate the First Amendment in this situation.

Gawker Media, LLC v. Bollea, 2014 WL 185217 (Fla.App. 2 Dist., January 17, 2014)

January 20, 2014 Electronic Discovery

Bullied student did not have to hand over all of his social media content in lawsuit against school district

A student sued the school district in which he attended high school for failing to protect him against bullying. The school district served discovery requests on the student seeking electronic copies of everything he did on social media during the time period of the alleged bullying. When the student refused to produce all of his social media content, the school district moved to compel.

The court held that the student did not have to produce all of his social media content, but had to produce any materials that revealed, referred, or related to any “emotion, feeling, or mental state.” The court looked to the case of E.E.O.C. v. Simply Storage Management, LLC, 270 F.R.D. 430 (S.D.Ind.2010) to find that the mere fact that the student had social communications was not probative of any mental or emotional state. Rather, the school district would be entitled to discover whatever communications were relevant to the claims or defenses in the matter.

In the social media discovery context, this meant something less than the student’s entire social media history:

To be sure, anything that a person says or does might in some theoretical sense be reflective of her emotional state. But that is hardly a justification for requiring the production of every thought she may have reduced to writing or, indeed, the deposition of everyone she may have talked to.

Despite this attempt by the court at limitation, one is left to wonder whether the scope of the court’s order — requiring production of materials that revealed, referred, or related to any “emotion, feeling, or mental state” — is so vague as to be of no real help. Scarcely anyone’s casual social media content (let alone the content of the typical teenager) contains material that is void of emotion, feeling or mental state. Tweets, comments, status updates and wall postings drip with pride, humor, loneliness, angst, and the rest of the spectrum of human sentiment.

D.O.H. ex rel. Haddad v. Lake Central School Corp., 2014 WL 174675 (N.D.Ind. January 15, 2014)

January 7, 2014 Cryptocurrency, Right of Publicity, Trademarks

The trademark and right of publicity woes of having a cryptocurrency named after you

Not too surprisingly, Kanye West’s lawyers have demanded the developers of the Coinye West cryptocurrency not use his name. The somewhat obnoxious letter shows that Kanye’s lawyers are asserting, among other things, trademark infringement and right of publicity misappropriation.

Russell Brandom at the Verge observes that “[o]nce the code is public, the original coders will be unable to prevent its use, forcing West’s legal team to prosecute every instance of Coinye individually.”

That observation raises a couple of interesting points. The first one is more of a clarification — once the code is in the wild, we should assume Kanye would only care to stop the use of his name, and would not seek (nor have any basis upon which) to stop anyone from using the code.

Stopping users of a cryptocurrency from using the name of that cryptocurrency could be a bit tough. Kanye’s lawyer threatens to “purse all legal remedies against any business that accepts the purported COINYE WEST currency.”

Infringement and misappropriation both depend on a use of the offending term in a commercial way. But users of the decentralized system, and the vendors who accept that currency, are not providers of any goods or services onto which Kanye’s identity will be attached. If one is merely using the currency as a tool, it’s hard to see how that’s any different from implicating the rights of the historical figures who appear on paper currency. So might it all be about the Benjamins? Maybe not at all.

December 31, 2013 Privacy

Is the future a trade between convenience and privacy?

This TechCrunch piece talks about how (predictably) Google wants to build the “ultimate personal assistant.” With Google’s collecting user preferences cross-platform and applying algorithms to ascertain intentions, getting around in the world, purchasing things, and interacting with others could get a lot easier.

But at what cost? The success of any platform that becomes a personal assistant in the cloud would depend entirely on the collection of vast amounts of information about the individual. And since Google makes its fortunes on advertising, there is no reason to be confident that the information gathered will not be put to uses other than adding conveniences to the user’s life. Simply stated, the platform is privacy-destroying.

What if one wants to opt-out of this utopically convenient future? Might such a person be unfairly disadvantaged by, for example, choosing to undertake tasks the “old fashioned” way, unassisted by the privacy eviscerating tools? This points to larger questions about augmented reality. As a society, will we implement regulations to level the playing field among those who are not augmented versus those who are? Questions of social justice in the future may take a different tone.