Category: Miscellaneous

“Information superhighway” may one day surpass the preeminence of the phone book.

When it printed an edition of the Evansville, Indiana Metropolitan Area Yellow Pages, Ameritech Publishing accidentally left out Robert Pigman’s name from his law firm’s ad. Pigman filed suit against Ameritech, seeking damages from the business he lost due to the omission. Ameritech moved for summary judgment.

Citing to an “exculpatory clause” in the advertising contract, which limited Ameritech’s liability to the price Pigman’s firm paid for the ad, the trial court granted Ameritech’s motion. Pigman appealed, asserting that the exculpatory clause was unconscionable and void as against public policy.

The appellate court agreed with Pigman and reinstated his lawsuit against Ameritech. Applying “greater judicial scrutiny” because of the nexus between Yellow Pages advertising and the regulated public telephone service, the court held that the advertising contract was a “contract of adhesion.”

Because of the overwhelming pervasiveness of the Yellow Pages, Pigman had been left with no other meaningful choice but to accept the unreasonable limitation of liability clause. The clause was, after all, nothing more than an illusory promise, since it only required Ameritech to return money it hadn’t actually earned.

The most interesting part of the opinion, however, comes at footnote 6, where, in discussing the great importance of Yellow Pages advertising, the court takes a moment to prophesy about the future of the Internet as a medium of commerce:

We observe that sometime in the not very distant future, when every home and business is online, people may do their shopping for goods and services through the Internet. When that occurs, the printed Yellow Pages directory will no longer enjoy the unique market penetration which it does today. Then, the print medium will be preempted by the information superhighway, and the printed Yellow Pages will no longer enjoy preeminence. Today, when an error is made, the error persists for a full year until the next edition is published. When the Yellow Pages is on the Internet, errors in advertising copy will be corrected with a few keystrokes, and such instant mitigation may well obviate a claim for damages of the kind presented in this case.

Are we there yet?

Pigman v. Ameritech Publishing, Inc., 641 N.E.2d 1026 (Ct. App. Ind. 1994).

Plaintiff ShopLocal sued defendant Cairo, its competitor in the online advertising industry. ShopLocal accused Cairo of unauthorized use of a content scraper, whereby Cairo accessed and republished advertisements created by ShopLocal. [Read about other litigation involving Cairo.]

In addition to claims under the Computer Fraud and Abuse Act [18 U.S.C. 1030 et seq.] and for common law trespass to chattel, ShopLocal asserted claims for breach of contract and unjust enrichment. Cairo moved to dismiss the unjust enrichment claim, asserting that ShopLocal should not be permitted to recover for both breach of contract and unjust enrichment in the same action. Because ShopLocal had not pled unjust enrichment as an alternative cause of action, Cairo argued, ShopLocal had failed to allege a claim upon which relief could be granted.

The U.S. District Court for the Northern District of Illinois rejected Cairo’s argument, and denied the motion to dismiss. The court held that under Illinois law, an unjust enrichment claim may be predicated on either a contract or tort theory. Because ShopLocal’s unjust enrichment claim was based in tort, it could stand alone without being pled in the alternative.

ShopLocal LLC v. Cairo, Inc., (Slip. Op.) 2006 WL 495942 (N.D. Ill., February 27, 2006).

There was some buzz this past week with the announcement that Skype and Google have both put their support behind the startup known as FON. Simply stated, FON provides the means for broadband subscribers to share their Internet connections with others through wi-fi hotspots. It’s a good idea in principle, but as this article from Forbes.com points out, the endeavor is not without its potential legal obstacles.

As the Forbes.com article observes, FON is cavalierly moving forward even though many broadband users’ agreements with their ISPs prohibit the sharing of accounts. Aside from these contract issues, some other possible questions concerning individual liability for FON users remain.

For example, what if a user sharing a connection distributed infringing content through that connection? Would the primary subscriber be considered an online “service provider” as that term is used in the safe harbor provisions of Section 512 of the Digital Millennium Copyright Act? Perhaps, but that’s probably not what members of Congress had in mind nearly a decade ago when they drafted the DMCA.

What about liability for making defamatory statements through a shared connection? Would the primary subscriber be immune from liability as a publisher under Section 230 of the Communications Decency Act? Once again, although there’s a good chance that the subscriber would find immunity under statute, the situation is quite different than that contemplated by the drafters of the legislation being applied. [More on Section 230 immunity]

Finally, what about distribution of obscene or illegal content? The average Internet user might be a bit uneasy about his or her IP address being associated with illegal pornography or the “chatter” of terrorists.

FON’s FAQ page states unambiguously that users would not be responsible for “illicit” activities of others conducted through a shared Internet connection. Perhaps that’s true, but a wise consumer should question whether the answer is as clear as FON would like it to be.

Technorati:
FON
Law
Copyright
DMCA
Defamation
Wi-Fi

The end of the year is quickly approaching, and in the spirit of retrospective reflection that accompanies the season, I have compiled this list of intriguing court decisions relating to the Internet handed down during 2005. It’s not a compilation of cases that are necessarily important to the overall development of this area of law (for example MGM v. Grokster is not on the list), but is merely a list of cases that have either off-the-wall facts or surprising/provocative outcomes. Think of the list both as a way to look back on the year, and as a little holiday gift to the loyal readers of this weblog (a group now measured in the several hundreds – thanks for your support!)

The comments for this post are open, so I invite you to note other Internet-related decisions you’ve found notable during the past year which I have not put on this list.

1. O’Brien v. O’Brien, 899 So.2d 1133 (Fla.App., Feb. 11, 2005)

Evidence obtained through use of spyware not admissible

2. Central New York Workers’ Comp. Bar Assn. v. New York Workers’ Compensation Bd., 16 A.D.3d 1066 (App.Div., March 18, 2005)

Internet access to only one party during trial provides unfair advantage

3. Vogel v. Felice, 127 Cal.App.4th 1006 (Cal.App. 6th Dist., March 24, 2005)

“Dumb Ass” is not a defamatory term

4. Liebert Corp. v. Mazur, 827 N.E.2d 909 (Ill.App. 1st Dist., April 5, 2005)

Password protection is not enough to protect trade secrets

5. State v Velardi, 612 S.E.2d 447 (N.C.App., April 5, 2005)

Court upholds admissibility of weblog evidencae used to convict

6. People v. Earle, (Not Reported in N.W.2d), 2005 WL 1224611 (Mich.App., May 24, 2005)

Escort’s website relevant evidence for truthfulness

7. Munster v. Groce, 829 N.E.2d 52, at n. 3 (Ind.App., June 8, 2005)

Even the courts know the Internet is the first place to turn for information

8. Freedman v. America Online, 2005 WL 1899381 (D.Conn., August 9, 2005)

No reasonable expectation of privacy in Internet subscriber information

9. Doe v. Cahill, 884 A.2d 451 (Del., October 5, 2005)

Delaware decision defines standards for protecting anonymous Internet speech

10. Commonwealth v. [___________], — A.2d —, 2005 WL 3196556 (Pa.Super., November 30, 2005)

Criminal record expunged for school librarian arrested for selling discarded copies of National Geographic on eBay

Technorati:
Law
Year in Review

Record expunged for librarian arrested after selling back copies of National Geographic to buy school computers.

Defendant (whose name I’m withholding in this entry in the event anyone does an Internet search for his name someday), a 24-year-old school librarian, rescued some of his library’s back issues of National Geographic from the trash can and sold them on eBay. He used the proceeds from the sale, along with $300 of his own money, to buy six computers for the school. Despite these generous and creative efforts, the school system complained to the district attorney’s office, and defendant was arrested for library theft.

In return for defendant resigning his position as librarian, the district attorney’s office withdrew the charges. Defendant then filed a motion to have the record of his arrest expunged. After the trial court denied the motion, defendant sought review. On appeal, the court held that the trial court applied the wrong burden of proof on the question of expungement, and that the prosecution failed to show why the arrest record should not be expunged.

The appellate court applied the four factors set out in the Pennsylvania Supreme Court case of Commonwealth v. Wexler, 431 A.2d 877 (Pa. 1981), to determine that the trial court abused its discretion in not ordering the arrest record expunged. The court commented on defendant’s motives: “Although perhaps hasty and not ‘cleared’ sufficiently through the proper channels, we believe [defendant’s] actions demonstrate the creativity and altruism so vital to our public schools.”

Commonwealth v. [___________], — A.2d —, 2005 WL 3196556 (Pa.Super., November 30, 2005).

Plaintiff Hammer, a self-published author of books on handwriting analysis and hypnosis, sued Amazon.com, alleging causes of action for defamation, copyright infringement, breach of contract, violation of the First Amendment right to free speech, discriminatory business practices, and conversion. As characterized by the court, the plaintiff essentially claimed that Amazon had unlawfully colluded with an individual who posted several negative reviews of plaintiff’s books. The plaintiff also claimed that Amazon acted unlawfully by removing plaintiff’s books from its listings.

Amazon moved to dismiss the plaintiff’s claims pursuant to Fed. R. Civ. P. 12(b)(6), and the court granted the motion. It held that the allegations of defamation could not stand, as the negative reviews could not be construed as anything other than opinion. The claim of copyright infringement failed because the complaint contained no allegations that Amazon had copied the plaintiff’s work. There could not be any breach of contract, as Amazon was clearly within its rights to terminate its contract with the plaintiff after providing advance notice (which Amazon did). The First Amendment claim failed as a matter of law because Amazon was not a state actor. The discriminatory business practices claim was dismissed because Amazon had the right to independently choose not to do business with the plaintiff. Finally, the court dismissed the conversion claim because the plaintiff had merely re-styled a contract claim, thus that count was preempted.

In addition to dismissing the plaintiff’s complaint in its entirety, the court entered a permanent injunction, enjoining the plaintiff from commencing any subsequent action relating to book reviews on Amazon.com or Amazon’s refusal to do business with him.

Hammer v. Amazon.com, — F.Supp.2d —, 2005 WL 2467046 (E.D.N.Y., Sept. 27, 2005).

I’ll leave it to the likes of Chuck Schumer, Ted Kennedy and Russ Feingold to complain incessantly over the next few weeks about not knowing enough about Harriet Miers, President Bush’s most recent nominee to the Supreme Court.

A look over the cases in which Miers has been involved as an attorney is scant on the topic of the law as it relates to technology. However, a quick search reveals that Miers and her Dallas firm Locke Liddel & Sapp have represented such heavyweights as Microsoft and RealNetworks. Notable decisions in cases where Miers was among the counsel of record include:

Microsoft Corp. v. Manning, 914 S.W.2d 602 (Tex.App. 1995) – Microsoft lost an appeal of the lower court’s grant of class certification in an action alleging breach of warranty, unjust enrichment, violations of the Magnuson-Moss Act, and violations of the Washington Consumer Protection Act. The underlying action dealt with issues surrounding disk compression technology embodied in Microsoft’s 1993 release of MS-DOS 6.0.

Shaw v. Broadcast.com, Inc. 2005 WL 2095770 (N.D. Tex., August 30, 2005) – Defendants Broadcast.com, Inc., Realnetworks, Inc. and Microsoft (represented by, among others, Miers) were awarded summary judgment in a patent infringement lawsuit brought by owners of a patent dealing with efficient transmission of streaming media.

Plaintiff-appellant Brennan filed suit against the Giles County Board of Education after it refused his request under Tennessee’s Public Records Act to inspect data on certain computers owned by the school system. Brennan’s request included all e-mail sent and received with the computers, as well as all websites visited with them.

The lower court held an in camera review of the requested information and concluded that the Act did not require it be made available for public inspection. Brennan sought review in the Tennessee Court of Appeals, which affirmed the lower court’s decision.

Brennan had asked the court to develop a per se rule under the Public Records Act which would automatically render data stored on school-owned computers subject to public inspection. The court declined to draw such a bright line, holding that the legislature did not intend for all such records to be subject to “public perusal.”

The court relied heavily on the Florida case of Times Publishing Co. v. City of Clearwater, 830 So.2d 844 (Fla.App.2002), which interpreted Florida’s nearly-identical statute on the issue. The court held that the language of the Tennessee statute, which provides for inspection of documents “made or received pursuant to law or ordinance or in connection with the transaction of official business by any governmental agency,” precludes inspection of private or personal communications.

Instead of developing a per se rule for the conditions under which documents on school-owned computers become subject to inspection, the court held that such matters should be reviewed on a case-by-case basis. Accordingly, the lower court was correct in conducting the in camera review.

Brennan v. Giles County Bd. of Education, 2005 WL 1996625 (Tenn.Ct.App., August 18, 2005).

Court holds that CIA violated provision of Energy Policy Act, ordering publication of information regarding acquisition of alternative fuel vehicles.

The Energy Policy Act of 1992, 42 U.S.C. §13211 et seq., requires federal agencies to purchase a minimum number of alternative fuel vehicles (“AFVs”) when adding to their fleets of automobiles. To ensure compliance with this environmentally-friendly requirement, 42 U.S.C. §13218 calls for federal agencies to prepare annual reports to Congress summarizing their compliance with the AFV purchasing requirements. These annual reports must be posted “on a publicly available website on the Internet.” 42 U.S.C. 13218(b)(3).

For the past six years, the CIA has apparently been too busy with the war on terror and other pressing matters to concern itself with the reporting requirements of the Energy Policy Act. Certain environmental groups noticed this, and filed suit in federal court in California, claiming that the agency (and 12 other agencies as well) had failed to properly make the AFV compliance information available online.

The plaintiffs filed a motion for summary judgment, claiming that there was no genuine issue of material fact regarding the failure of the various agencies to meet the reporting requirements. Although the court denied the motion as to the other 12 agencies (their reporting was at least somewhat sufficient), the court found that the CIA “essentially conceded that it failed to prepare or publish any compliance reports required under the [Energy Policy] Act.”

Accordingly, the court held that the CIA had not met its reporting obligations under the Act, and ordered it to publish on the Internet no later than January 31, 2006 information regarding its acquisition of AFVs during the past six years.

Center for Biological Diversity v. U.S. Dept. of Energy et al., 2005 WL 1656881 (N.D. Cal., July 14, 2005).