A Bad Idea From Utah: A Ban on Comparative Advertising

Posted by Corynne McSherry

The Utah legislature has quietly passed a dangerous law allowing trademark owners to prevent their marks from being used as keywords to generate comparative ads. If this law takes effect, a company like Chevrolet couldn't purchase "sponsored link" space on the Google results page when a user types "Toyota" as part of a search query--at least if the latter term is registered in Utah as an "electronic registration mark."

As Martin Schwimmer notes, Utah's own General Counsel warned the legislature that the law was likely to be found unconstitutional given the burden it would put on interstate commerce. To comply with the law, a search engine that received a search request would have to determine whether a user was located within Utah and, if so, check the search terms against Utah's registry of trademarks to prevent the unlawful triggering of advertising. The cost to search engines would be staggeringly high: "Literally millions of search requests from locations worldwide each day would be subject to verification of location."

Aside from its constitutional flaws, the law is just bad public policy. It undermines the fundamental purpose of trademarks: to improve consumer access to accurate information about goods and services. Trademarks are just shorthand terms that designate the origin of a product. Comparative advertising uses those shorthand terms to provide more information about the trademarked product and competitive products. That's why comparative trademark use is clearly protected under federal trademark law. If it weren't, Pepsi wouldn't be able to tell consumers that more people think Pepsi tastes better than Coke, and Apple wouldn't be able to make fun of Microsoft on national television every night.

The good news is that, given the constitutional problems, the law is likely to be challenged in court. But it's too bad the Utah legislature didn't heed its own counsel's advice and save Utah taxpayers the cost of defending this anti-consumer legislation.

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Court Clarifies Service Providers' Immunity From State IP Claims

Posted by Kurt Opsahl

Section 230 of the Communications Decency Act of 1996 is an amazingly powerful federal law, protecting interactive computer services by ensuring that the soapbox is not liable for what the speaker has said. Section 230's immunity to state law claims (typically defamation, but including all other lawsuits based on state laws) allows for many of the online services you know and love, including user product reviews, online auction feedback, internet dating services, message boards, classified ads, usenet -- the list goes on and on.

But Section 230 does not provide complete protection, exempting "intellectual property" law from its reach. The term "intellectual property" was not defined, leading to the question of whether state laws that are similar to traditional intellectual property are covered. Today, the Ninth Circuit emphatically answered that question, "constru[ing] the term 'intellectual property' to mean 'federal intellectual property,'" such as copyrights, patents and federal trademarks. Perfect 10, Inc. v. CCBill, LLC, __ F.3d __ (9th Cir. 2007). The Ninth Circuit reversed the District Court's ruling on Perfect 10's right of publicity claims, reasoning that:

"Because material on a website may be viewed across the Internet, and thus in more than one state at a time, permitting the reach of any particular state's definition of intellectual property to dictate the contours of this federal immunity would be contrary to Congress's expressed goal of insulating the development of the Internet from the various state-law regimes."

This means that Section 230 can protect service providers from claims that the users of their services violated state laws, such as the right of publicity, trade secrets and state trademark laws. This is great news for service providers, and great news for free speech, since it allows service providers to provide the platform upon which others may speak, while leaving the responsibility where it properly lies -- upon the author.

As for the federal intellectual property rights, the Digital Millennium Copyright Act provides a safe harbor for copyright claims. The Ninth Circuit decision clarified a number of factors of the DMCA safe harbor, importantly noting that "[t]he DMCA notification procedures place the burden of policing copyright infringement--identifying the potentially infringing material and adequately documenting infringement--squarely on the owners of the copyright." The Court of Appeals remanded the case back to the District Court to see whether CCBill qualified.

This is not going to be the last ruling on the subject. Perfect 10 has filed numerous lawsuits trying to hold everyone from search engines to credit card companies liable for other people's use of Perfect 10's pornographic photographs.

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New USPTO file sharing report falls short on consumer protection

Posted by Seth Schoen

In a little-noticed report entitled Filesharing Programs and "Technological Features to Induce Users to Share," the U.S. Patent and Trademark Office (PTO) has decided to attack several leading P2P software applications for making user interface decisions that allegedly "dupe" users into sharing files unintentionally. In hyperbole that is all too familiar in Washington, DC, these days, the authors claim that P2P therefore contributes to terrorism, child pornography, identity theft, and (of course) copyright infringement. Its authors include Tom Sydnor, who while an aide to Sen. Orrin Hatch was widely credited with the Senator's infamous "blow up their computers" solution to P2P file-sharing, and Lee Hollaar, a professor who was a motive force behind the ill-fated INDUCE Act. So it's fair to say these gentlemen have an anti-P2P agenda and a rather one-sided view of copyright law.

But the real problem with the report is that the invective, innuendo, and misguided legal analysis obscure interesting and worthwhile empirical research about the interface decisions made by various P2P vendors at various times. There is, at the heart of the report, quite a bit that makes sense.

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EFF Presents Pioneer Awards at ETech

Posted by Derek Slater

Last night, three Internet superheroes received awards, and one even got a cape.

EFF presented the 16th annual Pioneer Awards to Bruce Schneier, Yochai Benkler, and Cory Doctorow (in cape at right, source: Scott Beale/Laughing Squid and Wired). The event was kicked off by a rousing debate between our own Fred von Lohmann and HDNet Chairman Mark Cuban on YouTube and the future of copyright. Thanks to our award winners, to Mark, to our gracious hosts at ETech, and to everyone who came out to the event!

Missed out on the fun? Then check out Wired's and Ars Technica's recaps, photos by Scott Beale and Quinn Norton, and audio from the YouTube debate as well as Cory's and Bruce's acceptance speeches. Kevin Marks has also posted video from EFF's Birds-of-a-Feather session.

Update: And you can now get video from the YouTube debate here.

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Sensible Data Retention Policies Help Prevent RIAA Harassment

Posted by Corynne McSherry

The latest development in the RIAA's long-running filesharing shakedown campaign--demanding colleges and universities forward "pre-litigation" settlement offers to their students--has placed academic institutions in an untenable position. If they don't pass on the letters or even make them available to students, they are arguably harming those students by depriving them of an opportunity to make a better deal. (Though most students are refusing that opportunity.) On the other hand, every letter passed on helps the RIAA save money on litigation costs (which can then go toward suing more people) and avoid judicial oversight of the shakedown process. If you are a university counsel who just received, say, 12 letters, you have to decide who you care about more--those 12 actual students or the hypothetical students that the RIAA will go after in the future? And if you don't pass on the letters, you can just imagine the phone call from the students' parents when their sons and daughters get hit with a lawsuit they could have avoided.

Universities are responding in a variety of ways. The University of Michigan is forwarding the letters to students, along with links to further information to help students evaluate their options and, if need be, seek legal counsel. The University of Wisconsin, by contrast, is refusing to forward the pre-litigation letters. Says Brian Rust of UW's IT department: "These settlement letters are an attempt to short circuit the legal process to rely on universities to be their legal agent." The University of Maine is trying to find some middle ground where it may not exist by choosing to be a p.o. box rather than a delivery service. The university won't forward the letters, but will notify affected students that they can come and pick up the letter at a university office. As UM spokeperson John Diamond put it, "It's not the university's role to, in effect, serve papers on our students for another party."

Perhaps the best approach is the one taken by the University of Nebraska-Lincoln. UNL won't be forwarding most of the letters. It can't, because it only retains IP address logs for a month. The school is also demanding reimbursement from the RIAA for the cost of processing the complaints.

University counsel should take heed and talk to their IT departments--perhaps a sensible limited data retention policy could provide a way out of their impossible position. Then they should talk to the RIAA about compensation for the resources that have been wasted on this shakedown campaign.

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Mossberg on the DMCA

Posted by Fred von Lohmann

I don't always agree with the Wall Street Journal's Walt Mossberg, but his latest video missive (there is a print version, too) hits the nail right on the head:

"What we need is a new law from Congress, a law written from the perspective of the consumer and the internet, rather than strictly from the perspective of the copyright holders. The copyright holders deserve protection for their intellectual property, but we deserve some clear rules that would allow us to make more use of the digital content that we legally purchase than we have now."

It's worth watching the whole video -- Mossberg makes a variety of good points about fair use and the dangers of the DMCA.

(Thanks to Alex at Public Knowledge for pointing this one out to us.)

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MoveON, BNF v. Viacom: Update

Posted by Fred von Lohmann

On behalf of MoveOn.org and Brave New Films, EFF and Stanford's Fair Use Project today filed a lawsuit against Viacom for improperly issuing a DMCA takedown notice to YouTube over "Stop the Falisiness," a humorous video built around clips from The Colbert Report.

Viacom promptly responded in a letter, saying that they have no objection to the video and that "any takedown notice most likely did not come from us." That's interesting, because (1) the YouTube page specifically says that the video was removed due to a copyright complaint from Viacom; (2) YouTube's counsel verbally confirmed that the video was removed due to the DMCA takedown from Viacom; and (3) after sending a counter-notice to YouTube, Brave New Films received an email from well-known online copyright enforcer, BayTSP, apologizing for the mistake and asking that any questions be directed to VIACOM@BayTSP.com.

So perhaps Viacom would like to recheck the "careful records" it purports to keep, and give us something more than an assurance that it "most likely" was not their DMCA notice that took the video down.

This underscores the problem: with Viacom sending more than 160,000 DMCA takedown notices, it may not even be aware which videos it told YouTube to remove. If that's right, then Viacom will inevitably end up censoring some perfectly legitimate videos - surely, the MoveOn/Brave New Films video is not the only example of a fair use that got caught in Viacom's driftnet. And not everyone has the ability to file lawsuits or publicly call Viacom out on the carpet. As MoveOn's Eli Pariser said earlier today, 'With this lawsuit, we are making clear that corporations like Viacom must not be allowed to muzzle independent video creators and censor their free speech."

Viacom has also said that it "has no problem with" the video being reposted. While that is a welcome acknowledgement of fair use, we would still prefer a world where fair uses are not taken down by improper DMCA takedown notices in the first place. After all, if Fox got The Daily Show pulled off the air for running a clip from Fox News, Viacom wouldn't be satisfied with an "oops, we didn't mean it" the next day.

Update on March 23:YouTube has reposted the video, including all the comments left about it.

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Key Internet Censorship Law Struck Down Again

Posted by Lee Tien

The ACLU, EFF, and a coalition of plaintiffs achieved a victory for online free speech today when U.S. District Court Judge Lowell Reed ruled [PDF] today that a key Web censorship law violated the First Amendment and issued an order permanently blocking its enforcement.

Passed in 1998, the Child Online Protection Act ("COPA") sought to restrict minors' online access to "harmful to minors" material -- that is, material that's sexual and inappropriate for those under the age of 17. Congress enacted COPA after the U.S. Supreme Court found its predecessor, the Communications Decency Act ("CDA"), unconstitutional.

COPA was intended to be less sweeping than the CDA by censoring only "commercial" communications on the Web, thus ignoring email and all other forms of Internet speech, and by providing liability "safe harbors" for websites that restrict access by minors.

But these limits didn't save COPA for many, many reasons. For instance, Judge Reed found that COPA by its terms includes free websites that make money via advertising or through book sales of goods -- thus affecting EFF member-plaintiff Bill Boushka, who writes about and advertises his book about gays in the military on his website.

At bottom COPA has two fundamental flaws. First, it's aimed at material that's completely legal for adults -- but as the judge found, there's no reasonable or feasible way to only restrict online access by minors without harming adult access. Second, it's less effective and more harmful to speech than parents' voluntarily managing their children's online access if necessary. That doesn't make "censorware" praiseworthy, but it does render COPA constitutionally infirm.

For more, check out ACLU's blog post on the ruling.

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miniLinks for 2007-03-21

Posted by Danny O'Brien

• Deutsche Telecom Ditches DRM
  Musicload, its European music download site says it is in
  negotiations to develop alternatives to copy restrictions
  because a whopping 75% of user complaints come from DRM!
  
• Lessig: "Make Way for Copyright Chaos"
  Is the judiciary taking too central a role in copyright
  law?
  
• The Case Against YouTube, by a Viacom Lawyer
  "And, above all, copyright law can welcome only those with
  pure motives," says a lawyer for the infamously pure
  entertainment industry.
  
• Is the Internet Killing the Piracy Business?
  Physical pirates suffer challenges to their business model
  from non-commercial infringers.
  
• FBI Had Phone Contracts With AT&T, Verizon and MCI
  FBI paid the telcos to harvest phone records from American
  citizens.
  
• Europe's Broadcast Flag: Will it Get Government Support?
  Ars Technica analyzes our report on copy controls in the
  European digital video standards.
  
• Data Retention Begins its Feature Creep
  UK plans to check stored phone records after accidents to
  detect illegal cell phone use while driving.
  
• Asus Puts the "Analog Hole" to Good Use
  Its new sound-card will play PC sound internally, and re-
  record it instantaneously.
  
• Sony Exec: DRM Should Be "Invisible"
  Like the rootkit was invisible to its unsuspecting hosts?
  
• The Smart Card Alliance Thinks Privacy Is Bunk
  "Privacy concerns are all perception and hype and no
  substance," says spokesman in response to REAL ID worries.
  Nice to see industry taking the problems so seriously.
  
• Consumer Electronics Association: DRM Is Not the Answer
  to Piracy
  The CEA's Gary Shapiro tells SXSW that "innovation is a
  tide that raises all boats."
  

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IPRED2 after the Committee

Posted by Danny O'Brien

When it was sold to politicians in Brussels, the pitch for the directive on
criminal measures aimed at enforcing IP rights in Europe (IPRED2), was all
about commercial piracy and counterfeit goods that endanger health and safety.

The reality has turned out quite different. The current draft directive —
adopted yesterday by a key European Parliament committee — will criminalize a
wide range of activity that is currently lawful and has no connection to
public health or safety. This is happening despite warnings by digital rights and
consumer groups and tech industry bodies that the existing language was overbroad.

Our summary of the continuing problems:

On Scope

The draft directive still applies to a broader range of intellectual property
infringements than commercial piracy and counterfeiting. As a result, it's
far broader than the current international standard for criminal IP
enforcement — the 1994 TRIPs agreement.

Heavy lobbying has meant that patents are now excluded. The bad news is that
many other IP and IP-like rights are not. The directive applies to "such
intellectual property rights as are provided for in Community legislation
and/or national legislation in the Member States."

What that means is unclear. It expressly includes such the rights as the "sui
generis rights of database makers." And new language adds areas that weren't
previously thought of as intellectual property at all: An amendment now implies
that conditional access regimes for pay TV (currently covered by private
contract law) might now be considered "intellectual property" across Europe.

Consumer Confusion

Individual Europeans still don't have a bright line to follow to avoid
criminal sanctions (which include substantial fines, and, in certain situations,
imprisonment). JURI rejected an amendment that would have limited the
directive to commercial activity done with the intent to earn a profit.
Instead, consumers will now have to decide if their activity is carried out
for "personal and not for profits purposes" [sic] and was done for the purpose
of obtaining "an economic advantage." Making a mistake about that could land
you under police investigation, or even in jail.

The Threat to Industry and Innovation

Many industries now face possible criminal sanctions for legitimate business
activities, thanks to an oral amendment adopted by JURI that ensures that
"aiding or abetting and inciting" intentional intellectual property
infringement must be treated as criminal offences. "Inciting" is not defined.
Like the unclear "inducement' standard introduced by the U.S. Supreme Court's
MGM v. Grokster judgment and the INDUCE bill's (failed) attempt to expand
secondary copyright liability standards, this is likely to create legal
uncertainty and to chill investment in technological innovation.

This lack of clarity is particularly disconcerting given that the directive
provides for destruction of material and equipment used for infringing and the
closure of premises used to commit an act considered an offence under the
directive.

For the full summary, FFII have listed the main text (together with the
adopted amendments shown in yellow) here.

Can IP Law Make Good Criminal Law?

Aside from the fundamental question of whether it is good policy to use the
state's policing resources to enforce what are essentially private rights, the
directive's imprecision underlines the key concerns with using the blunt
instrument of criminal sanctions to enforce the nuanced rules of copyright.

Unlike the clear, hard lines of criminal codes, copyright law is often open to
interpretation. Copyright lawyers can't agree on what are "private" and
"personal" uses of copyrighted works. Does "personal use" include sharing a mix CD?
Asking consumers to decide where that line lies in order to avoid criminal penalties
is a heavy demand.

The JURI Committee did adopt several safeguard measures yesterday, including
a provision banning misuse of threats of criminal sanctions, as well as two
exclusions on what will be considered "commercial scale" infringement subject
to criminal sanctions. But it is equally obvious
that the JURI committee had a
chance to introduce clearer limits on IPRED2's effect on law-abiding consumers
and industry and failed to do so.

There's still time for IPRED2 to be fixed. The draft directive now moves to the European
Parliament for a full plenary vote on April 24, and then to the Council. Will
Brussels listen to the hundreds of thousands of citizens this directive will
affect — or will they be content to turn EU citizens into counterfeit
copycriminals?

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