GoDaddy’s user agreement has suffered a loss at the hands of a U.S. District Court Judge in Arizona. A client sued the domain registration company over its practice of “parking”– the directing of undeveloped domains to GoDaddy-created advertisements. Those advertisements…

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Technologist Stephanie Rabiner

Last year, we wrote about a ridiculous situation in which the Association for Information Media and Equipment (AIME) threatened UCLA, after discovering that the school had set up an online video service, that let UCLA professors put up legally licensed video clips so that students could watch them from their computers. AIME claimed that UCLA’s license did not allow for such uses. UCLA claimed this was fair use. After initially taking down the videos, UCLA decided this was worth fighting over and put the videos back up last March. At the time, we thought a lawsuit from AIME would come quickly, but apparently it took until December. UCLA recently filed a motion to dismiss the lawsuit, setting up a few reasons why — including the claim that, as a state university, it has sovereign immunity from copyright lawsuits and, also, that AIME is not the copyright holder in question, and thus has no standing.

However, as Kevin Smith (not the filmmaker we’ve been talking about recently, but rather someone at the Duke University Library) notes in the post above, there is an interesting claim in the motion, where UCLA suggests that the breach of contract claim (which comes under a state law) is preempted by federal copyright law. If I remember the details correctly (and you copyright lawyers out there, feel free to correct me), with the Copyright Act of 1976, that law basically superseded any state laws that covered the same grounds. Mostly, people have thought this meant that state copyright laws effectively were wiped out (though, as we’ve seen, some awful remnants of those laws remain).

However, what UCLA seems to be arguing, is that federal Copyright Law could also wipe out portions of state contract law as well, if those aspects are covered by copyright. It’s a creative way of saying that you can’t contractually give up aspects of copyright, such as fair use. Now, there are some areas where it’s known you can’t give up what copyright says via contract. You can’t, for example, contractually give up your termination rights (which let you take back a copyright you assigned to someone decades later). Also, it’s not quite the same thing, but the recent ruling in the Augusto case has suggested that there are situations where you don’t give up copyright exceptions (in that case, first sale) — but it’s distinguished by the fact that the court effectively said there was no license on promotional CDs (despite a stamped on “license” text).

So rather than relying on something like that, UCLA seems to be relying on preemption of state contract law, to say that even if you signed a license agreement, fair use rights can still apply. It’s an interesting point. I’m of a mixed opinion on whether or not it’s a good thing, however. I am a fan of such copyright exceptions, and would be worried if we started to see fair use “licensed away” in more situations. However, would that also mean that we couldn’t license away other aspects of copyright law? Would that cause trouble for certain types of licenses, like Creative Commons licenses?

I’m guessing that the court may skip over this issue entirely, in that it can just hand UCLA a victory on the sovereign immunity or lack of standing claims and just move on without addressing this issue. However, I do expect that it will show up again in other lawsuits at some point.

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Techdirt Mike Masnick

Okay, maybe I’m being a bit sarcastic with the title.  But according to a recent article and study (i.e., the Sophos Security Threat Report), spam, phishing, and malware attacks on social networking sites doubled from 2009 to 2010.  Not surprisingly, identity theft and third party use of personal information were primary goals of cybercriminals.

This is hardly shocking and it wouldn’t be surprising if these numbers doubled again from 2010 to 2011 given the increasing importance of social media—for better or worse—in our personal and business lives.  But what do people really expect?  Criminals go where the people are and when Facebook has 600 million users, that’s a big crowd to fleece.  And criminals can do so in the comfort of their own homes and in foreign countries knowing full well that their chances of getting nabbed are about as likely as Apple stopping production of the iPhone.  What do they really have to lose?

Not surprisingly according to the article, users want sites like Facebook to take stronger security measures.  And while sites can certainly do so in some instances voluntarily, it may take a court ruling (as it often does) to force a company to implement more substantive protections. But first you have to get past those nasty contractual disclaimers that we lawyers put into practically all user agreements about not holding the site liable for almost anything that happens on it:  “Identity theft be damned—so sorry, but it’s just not our problem!” 

Remember when you clicked “I AGREE” on that user agreement?  You can be sure Facebook does, because that’s an enforceable contract in most instances.  (No need to thank us, by the way—the public’s opinion of lawyers is thanks enough!)  Very tough to challenge, but not impossible if the right facts present themselves.  Combined with the right judge, of course.  Sometimes the lottery’s easier to win though.

The fact is that while social media sites have to do more, especially those that operate on the massive scale Facebook does, we have ourselves to blame also.  How much personal information do we really need to disclose about ourselves?  I’ve always believed that less is usually more, but perhaps because I’m over 40 (which is 95 in cyberyears), many young ’uns believe that more is more.  And that even more is still not enough.  I forget:  Does TMI stand for “Too Much Information” or “Too Many Idiots” when we  ”overshare?”  Because cybercriminals count on both meanings to do their dirty work.

Do we really need to tell everyone when we won’t be home, thereby inadvertently notifying criminals when the best time to rob us is?  Or are we so egotistical that we have to “friend” a ton of people so we can brag about how big our network is, only to unwittingly let in unsavory characters? Or to post a lot of personal details until the inevitable privacy breach thereby exposing all of that information to the world—and to sophisticated criminals who can then make use of it in all sorts of ways that decent law-abiding people have never thought of.

I often wonder where the proper practical balance is.  Because if you’re expecting the law to catch up to address some of these informational privacy and security issues, we’ll be on Web 5.0 at that point … and on Cybercriminal 7.0.  And do you really want to be the “test case” anyway?

(U.S.S.C., Commercial Law, Intellectual Property, Patent) In a patent application seeking protection for a claimed invention explaining how commodities buyers and sellers in the energy market could protect, or hedge, against the risk of price changes, the denial of the application is affirmed where: 1) the machine-or-transformation test is not the sole test for patent eligibility under 35 U.S.C. section 101; 2) Section 101 precluded a reading of the term “process” that would categorically exclude business methods; and 3) even though petitioners’ application was not categorically outside of section 101 under the two atextual approaches the Court rejected today, that did not mean it was a “process” under section 101.

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(U.S. Fed. Cir., Insurance Law, Intellectual Property, Patent) In a suit for patent infringement, related to computerized methods for administering variable annuity plans, district court’s denial of defendants’ motion for summary judgment as a matter of law that it does not infringe the claims at issue of the ’201 patent is reversed and remanded where: 1) the district court erred in denying defendants’ motion for JMOL of noninfringement as the evidence on the record does not support jury’s verdict of infringement; and 2) because defendant did not infringe, its argument that the district court abused its discretion by refusing to grant it leave to amend its complaint to assert a claim for invalidity under 35 U.S.C. section 101 need not be addressed.

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(U.S. D.C. Cir., Administrative Law, Copyright, Entertainment Law, Intellectual Property, Media Law) In the Recording Industry Association of America’s petition for review of the Copyright Royalty Board’s decision instituting a 1.5 percent per month late fee for late royalty payments, and implementing a penny-rate royalty structure for cell phone ringtones (under which copyright owners received 24 cents for every ringtone sold using their copyrighted work), the petition is denied where: 1) the Board appropriately took market evidence into account when imposing a late fee; 2) a copyright owner’s ability to terminate a section 115 license in no way barred the imposition of a late fee; and 3) even if it were true that divided interests in a copyright made it difficult to make timely payments to each copyright owner, that fact would in no way counsel against the imposition of a late fee.

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(U.S. 10th Cir., Constitutional Law, Copyright, Intellectual Property, International Law) In an action challenging the constitutionality of Section 514 of the Uruguay Round Agreements Act (URAA), which granted copyright protection to various foreign works that were previously in the public domain in the U.S., summary judgment for plaintiffs is reversed where: 1) the government’s interest in securing protections abroad for American copyright holders satisfied this substantial government interest standard; 2) Congress had substantial evidence from which it could reasonably conclude that the ongoing harms to American authors were real and not merely conjectural; and 3) there was substantial evidence from which Congress could conclude that Section 514 would alleviate these harms to American copyright holders.

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(U.S. Fed. Cir., Intellectual Property, Patent) In a patent infringement suit by Encyclopedia Britannica against various defendants, involving patents relating to a multimedia database search system for retrieving textual and graphical information, district court’s grant of summary judgment in favor of defendants in declaring the patents invalid as anticipated by foreign patent application is affirmed as section 120 requires each application in the chain of priority to refer to the prior applications, and here, the patents in suit cannot claim priority as the ’955 application failed to specifically reference the earlier filed ’917 application and did not claim priority to the ’917 application.

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(U.S. Fed. Cir., Corporation & Enterprise Law, Evidence, Intellectual Property, Patent) In a patent infringement suit against defendant and its two employees, related to patents involving technology for automated duplication of compact discs, district court’s judgment is affirmed in part, reversed in part and remanded where: 1) district court’s denial of defendants’ Rule 59(a) motion is reversed and remanded as the jury’s verdict of the two employees’ individual liability of direct infringement, despite the lack of instructions on defendant’s existence or piercing its corporate veil, was plain error that requires a new trial; 2)jury verdict of individual liability for inducement is reversed as it involved a mistake of law; 3) district court’s legal error in presenting the contributory infringement issue with respect to individual liability of the two employees to the jury requires a new trial; 4) because the verdict was clearly not supported by the evidence and was based on only speculation or guesswork, district court’s denial of defendants’ Rule 59(a) motion is reversed and remanded for a new trial on damages; and 5) the district court did not abuse its discretion by denying defendants’ motion for leave to amend.

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(U.S. 2d Cir., Civil Procedure, Copyright, Intellectual Property) In a copyright infringement action in which the district court dismissed the action for lack of personal jurisdiction, the Second Circuit certifies the following question to the New York Court of Appeals: In copyright infringement cases, is the situs of injury for purposes of determining long-arm jurisdiction under N.Y. C.P.L.R. section 302(a)(3)(ii) the location of the infringing action or the residence or location of the principal place of business of the copyright holder?

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