Austin Technology Law Blog

What Are Patent Trolls and Why Is President Obama Saying All Those Terrible Things About Them?

Paul Stanfield — Wed, 05 Jun 2013 14:30:01 -0600

Patent: an intellectual property right granted by the Government of the United States of America to an inventor “to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States” for a limited time in exchange for public disclosure of the invention when the patent is granted. USPTO Website

Troll: a dwarf or giant in Scandinavian folklore inhabiting caves or hills. Merriam-Webster Dictionary

Patent Troll: (Patent Assertion Entities, also known as PAEs) or "companies that don’t actually produce anything themselves and essentially leverage and hijack somebody else’s idea and see if they can extort some money out of them". President Obama

Patent trolls accounted for more than half of the patent suits filed this year. The President issued executive orders today that, inter alia, asks Congress to pass laws to: (i) require disclosure of the real party in interest (not just the Patent Assertion Entity that merely holds patents, but doesn't practice any of them); (ii) remove consumers that are using the affected products in the manner intended from the effects of the lawsuits; and (iii) provide for the awarding of attorneys fees and costs to defendants in "abusive" lawsuits.

Now, given the speed in which Congress acts (Hey, the House has already repealed Obamacare 37 times), it is likely that this will not have any near term effect. Some large patent holders, that are not PAEs, have expressed concern that laws such as those suggested by the President could have unintended consequences and make it harder for non-trolls to protect their patents.

Given that it is possible that facts will surface that indicate that the IRS has engaged in the targeting of trolls, that trolls could have prevented the tragedy at Benghazi or that trolls were the AP sources that the Justice Department was looking for, this could get folded into the other "scandals" and fail to get any legislative traction. Or, it could just not get any legislative traction, like almost everything else. It's now up to Congress.

UPDATE: Circuit Court of Appeals Reverses Decision That Use of Rutgers Quarterback's Likeness Was "Transformative". Mr. Hart Is Back "In The Game".

Paul Stanfield — Wed, 29 May 2013 14:57:33 -0600

We noted back in October of 2011 that a District Court in New Jersey had granted EA Sport's motion for summary judgment in a suit brought by Ryan Hart, a former quarterback at Rutgers. EA Sports had used as a basis for its motion that even though the video game used Mr. Hart's likeness, including his height, weight, home town and commonly worn visor and arm bands that the mechanism of the video game allowed users to change these and as such was "transformative". If a use is found to be transformative, usually the courts will find that the user's First Amendment rights prevail over the subject's privacy rights. The District Court so found in this case and granted defendant's motion. An appeal ensued.

The Circuit Court of Appeals reversed. In a 2 to 1 decision, the Circuit Court rejected the idea that the ability to change the player's characteristics by the user rose to the level of transformative use. In fact, the appellant court held that the presence of interactivity, the ability to change the characteristics of the subject (the court noted that the player's unaltered image was the default image) and the presence of other creative elements did not tip the "balance" in favor of the First Amendment.

Thus, the granting of the motion for summary judgment was reversed and remanded for further hearings. Mr. Hart is back "In The Game".

It's also nice to finally see someone from Rutgers win something.

A. C.ritical R.eview O.f N.ames Y.ou M.ight S.horten. "ACRONYMS" See What I Did There?

Paul Stanfield — Tue, 28 May 2013 12:53:38 -0600

For the tens and tens of you that read this little blog, this has very little application. This is written for people that regularly create contracts and for my clients that regularly send me their writings to review. I review a lot of descriptions of work that are usually contained in Statements of Work that describe the services that my clients intend to perform for their customers. Since almost all of my practice centers around technology contracts, I get to review things like the following:

"Vendor will provide technical resources on a time and material basis within the following business process areas for the Implementation:

• ECC 6.0, EHP4
• SAP SCM 7.0
• SAP Solution Manager
• Netweaver Stack
• BOBJ Data Services version 7.0
• BI 7.0
• Business Objects 3.10
• GRC"

Now, there was no question in the mind of the author as to what was intended. He or she had a perfect idea of what the tasks would entail. The problem is that if there were ever a need to interpret this, principally by a trier of fact, and probably 4 or 5 years in the future, it quickly becomes ambiguous. For example, the acronym "GRC" probably in this context means "governance, risk and compliance" but AcronymFinder lists well over 250 other possibilities.

So, for all people that write contracts, review contracts or read them for pleasure (sick), a basic rule for contract construction is to define the acronyms. Why leave it up to someone who is not an expert to try and guess what you were thinking? TLA ("Three Letter Acronyms") do not add to the understanding of an agreement unless they are adequately defined. As further illustration, I once represented an electric utility that operated a nuclear powered generating facility. I was discussing an issue regarding some faulty equipment with the engineers on site and they kept referring to a "BRT". After several uses of the acronym I inquired as to its meaning. They motioned toward the giant hyperbolic cooling towers next to the reactor containment buildings and said, without a hint that they were being jocular, "Oh, that's those Big Round Things."

eFax Scam - Look For This In Your Inbox.

Paul Stanfield — Fri, 17 May 2013 11:16:21 -0600

From time to time we try to alert you to scams. This morning I received an e-mail that looked like this:

Fax Message [Caller-ID: 310-293-1860]

You have received a 2 pages fax at 2013-05-17 10:09:12 .

* The reference number for this fax is min1_did71-9694455268-1026725108-89.

View this fax using your PDF reader.

Click here to view this message

Please visit www.eFax.com/en/efax/twa/page/help if you have any questions regarding this message or your service.

Thank you for using the eFax service!

Home Contact Login

2013 j2 Global Communications, Inc. All rights reserved.
eFax is a registered trademark of j2 Global Communications, Inc.

This account is subject to the terms listed in the eFax Customer Agreement.

This is a phishing expedition. See here and here. Since we use an online faxing services here at the firm, and this looks really real, I was ready to click on the link. In addition, eFax is a legitimate faxing service. Thankfully, our friends at McAfee warned me off of this. Apparently, going to the link would load malware or a virus on your system. Be careful.

Texas Uniform Trade Secrets Act ("TUTSA") Becomes Effective September 1, 2013.

Paul Stanfield — Mon, 13 May 2013 15:55:59 -0600

Texas has become the 48th state to adopt a uniform trade secrets act. This legislation was signed by Governor Perry and will become effective September 1, 2013. A text of the act as passed may be found here.

Notable provisions of TUTSA include the following:

The Act permits "reverse engineering" unless "prohibited", which prohibition presumably can be accomplished by contractual prohibitions.
"Reasonable" efforts must be made to keep the information secret in order that it may be treated as a trade secret. See our immediately preceding post. Yeah, the one with the monkey and the assault rifle.
An injunction may be ordered in the event of actual or threatened misappropriation. In addition, "affirmative acts" may be ordered to protect a trade secret. This codifies a court's authority to compel both the prohibition of an act or the commission of an act to protect a trade secret.
In addition to injunctive or affirmative relief, damages can be awarded, which can be based on actual loss, unjust enrichment or a reasonable royalty.
If "wilful and malicious" actions are proven by "clear and convincing" evidence, punitive damages may be awarded up to two time direct damages.
Attorney's fees may be awarded to the prevailing party if a claim of misappropriation is made in bad faith, a motion to terminate an injunction is made or resisted in bad faith or wilful and malicious misappropriation exists.
Lists of actual or potential customers or suppliers are explicitly mentioned as possible trade secrets.

This Act codifies what was covered under case law before and should help in the preservation of the trade secrets of Texas businesses.

Failure To Do The "Trade Secret Dance" Causes Company To Lose Control Of Its Processes.

Paul Stanfield — Tue, 07 May 2013 13:12:44 -0600

As we all know, most intellectual property is protected by patent, copyright or trade secret or some combination of the three. Because of the expense and long lead time for patents, a lot of companies (tech and otherwise) rely on trade secret protection for the "crown jewels" of their business.

Also, as we all know, in order to have a court treat your crown jewels as trade secrets, you have to show that you treated them as such. In court speak, you have to make "reasonable efforts" to preserve the secrecy of the information. If you haven't taken such efforts, then you can't get a court to treat them as secrets. The processes that are used to document "reasonable efforts" are referred to by some as the "trade secret dance". In other words, you have to take steps to behave in a way that demonstrates your "reasonable efforts" to maintain secrecy. We have discussed this before (see here and here).

A court in Connecticut reaffirmed this requirement recently in the aerospace industry when it found that a company had not taken such reasonable efforts to protect its rubber injection molds, the injection apparatus and the company's prices and hence, could not get an injunction against a competitor to prohibit such competitor from using similar information.

The court cited the company's practice of conducting tours of the facility for the public and even competitors in which the participants in the tours were afforded unrestricted views of the molds and the machines from as close as six feet. The process was explained and at no time were the participants in the tours notified that anything they saw was confidential nor were they obligated to sign any confidentiality agreements. It was apparently also common practice for the company to quote prices for their products to anybody that asked without any indication that the prices were confidential.

For this and other reasons, the court found that the company had not taken reasonable efforts and declined to grant an injunction in their favor. This was most unfortunate for the company as it was in bankruptcy, which it claimed was due in large part to its loss of the trade secrets.

This is not a groundbreaking or shocking opinion and is in line with established trade secret law but it does reaffirm for all of us that are counting on trade secret law to protect our stuff, we better make sure that we keep our stuff secret. This starts with doing an intellectual property inventory and continues through the establishment of a intellectual property protection program that must include as a very important component, a trace secret protection process (i.e. the dance).

Court Becomes "Particular" About First Sale Doctrine and Therefore You Can Never Resell Your Digital Music.

Paul Stanfield — Thu, 25 Apr 2013 15:13:10 -0600

I'm an old guy. One of the first musical purchases I ever made was a 45 rpm (that's revolutions per minute for those of you that have never seen a phonograph) recording of Bobby Vee's "The Night Has A Thousand Eyes". If I still had that physical record, I could sell it to you without fear of violating anyone's copyright because of a little something called the "first sale" doctrine. We have mentioned that several times in this blog (see here, here and here). The first sale doctrine says that after the first sale of a copyrighted work, the copyright holder loses its right to restrict further sales. This is the reason that stores that sell used books, records, CDs, DVDs, etc. can exist.

Now, if I could find that particular song on ITunes, I could buy it, download it to my computer or MP3 player and listen to it all I want. If I tired of that, I could use the services of a company called ReDigi. In doing that, I would download an application called Media Manager and then use that to upload the digital file of the recording to ReDigi's remote server in Arizona, which they call the "Cloud Locker". Media Manager then prowls the hard drive of my computer and connected devices to determine if I have retained a copy. If it detects one, it prompts me to delete it. When that happens, only one copy of this particular recording exists and it exists only on the Cloud Locker. I then can either continue to listen to it from the Cloud Locker or I can opt to sell it. If I opt to sell it, ReDigi makes it impossible for me to continue to listen to it. So, now I can use ReDigi to sell that particular recording to you. The exchange is made for credits that you can get by uploading other music. When it is transferred to you (automatically, without human intervention by ReDigi), you can store it, stream it, sell it or download it to one of your devices to listen to it.

In both instances, the result is the same. I bought a copy of "The Night Has A Thousand Eyes" legally. I have transferred it to you. I no longer have a copy. I can't sell it again.

Cool, right? Everybody's happy. I can buy more music with my credits. You are in possession of a great piece of nostalgia and I have no more copies to sell to undercut the copyright holder's income stream. The Southern District of New York says: "Not so fast, my friend".

In a case styled Capitol Records, LLC v. ReDigi Inc., the court held that the first sale doctrine can not apply to non-physical (i.e. digital) recordings.

The First Sale Doctrine is codified in Section 109(a) of the Copyright Act and states in pertinent part: "...the owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord."

The Court held that ReDigi had several problems under this provision. First, it said that ReDigi had violated Capitol's reproduction rights (another right under the Copyright Act), therefore it was not "lawfully made under this title". The Court also said that the Act only protects distribution by the owner of a particular copy or phonorecord...of that copy or phonorecord". (Emphasis added by Court). So, the transfer of the files requires copying on ReDigi's server, which violates the reproduction rights and because the sale is not a sale of that particular copy, the first sale doctrine does not provide a defense. The Court specifically said that the first sale defense is limited to "physical" items. To comply with this, you would have to sell and transfer your computer or MP3 player with the file on it.

This ruling was part of an opinion resulting from Capitol's Motion For Summary Judgment and other matters still remain to be decided, but the Court left little doubt about where it stood on this issue.

New Location. Same Great Service.

Paul Stanfield — Sat, 16 Feb 2013 12:59:56 -0600

The War Over "App Store" Continues. Amazon Wins One of the Battles.

Paul Stanfield — Fri, 18 Jan 2013 12:48:52 -0600

We have previously written about the contentious nature of the battle among Apple, Amazon, Microsoft and others in regard to the use of the term "App Store". See here and here.

One of the salvos launched by Apple in its suit against Amazon involved a claim for false advertising. Amazon moved for summary judgment on this claim and on the first business day of the new year, the United States District Court for the Northern District of California granted Amazon partial summary judgment.

The Court found "..Apple has failed to establish that Amazon made any false statement (express or implied) of fact that actually deceived or had the tendency to deceive a substantial segment of its audience. The mere use of “Appstore” by Amazon to designate a site for viewing and downloading/purchasing apps cannot be construed as a representation that the nature, characteristics, or quality of the Amazon Appstore is the same as that of the Apple APP STORE."

The Court held that "...if an advertisement is not false on its face (i.e., if there is no express or explicit false statement), the plaintiff must produce evidence, usually in the form of market research or consumer surveys,showing exactly what message was conveyed that was sufficient to constitute false advertising." Apple failed to do so in this case. Round one to Amazon.

Bill Introduced In Texas Legislature To Prohibit Employer From Asking You About Your Social Media Password.

Paul Stanfield — Thu, 17 Jan 2013 12:40:21 -0600

Having solved all the other problems in Texas, including the problem of gun violence (prayer) and the problem of uninsured citizens (cutting Medicaid) the Texas legislature has turned to the burning issue of employers requiring employees to provide access information to employee's private social media accounts.

House Bill 318 has been introduced to make it an "unfair employment practice" if an employer "...requires or requests that an employee or applicant for employment disclose a user name, password, or other means for accessing a personal account of the employee or applicant, including a personal e-mail account or a social networking website account or profile, through an electronic communication device."

This bill still allows "monitoring" employee usage of employer provided media and also allows employer policies prohibiting use of company provided resources for personal use. It doesn't provide for a specific remedy or a damages cap and it will likely be amended substantially before it passes, if it passes at all. This would make Texas one of a handful of states that has jumped on this burning issue. Crisis averted.

We Are In The Midst Of a Hot Cyberwar, Make No Mistake About It. Iran Fires The Latest Salvo (That We Know Of).

Paul Stanfield — Wed, 09 Jan 2013 16:32:12 -0600

In December of last year, several banks' (Bank of America, Citigroup, Wells Fargo, U.S. Bancorp, PNC, Capital One, Fifth Third Bank, BB&T and HSBC) websites were inundated by DDoS (distributed denial of service) attacks. DDoS attacks generally do not seek to penetrate the sites or to obtain information or steal anything but try to overwhelm the capacity of the website to respond to the traffic directed toward them. The attacks in December were launched by an entity that had access to multiple computers, such as in a data center, and exceeded the capabilities usually found in your standard run of the mill hackers.

Today, the New York Times ran an article that lays the attacks at the doorstep of Iran. An independent hacker group called Izz ad-Din al-Qassam Cyber Fighters has tried to take credit for the attack, saying it was retaliation for the anti-Muslim movie that prompted riots throughout the Muslim world and which was involved in the Benghazi consulate attack. Izz ad-Din al-Qassam called it Operation Ababil, referring to Allah sending birds to drop bricks on elephants sent by the King of Yemen to Mecca. However, U.S. officials think it is the work of Iran and is in retaliation for economic sanctions and the release by the U.S. and/or Israel of the Stuxnet, Flame and DuQu malware.

Whatever it is, the DDoS attacks spewed 70 gigabits per second at the sites, which included a new wrinkle involving requests for encryption, and which adversely affected the sites' performance. The attacks used a readily available malware toolkit called Itsoknoproblemobro.

It is certain that the attacks that we have heard of are only the tip of the malware iceberg and it is probably as certain that these attacks and counterattacks will continue to escalate. Warriors on the front lines of these wars will be keyboard commandos and may someday sport the malware marksman ribbon on their dress uniforms. This is war.

FTC Concludes Investigation Into Google's Search Practices, Finds Nothing Much Wrong There. Hey, Google It If You Don't Believe It!

Paul Stanfield — Mon, 07 Jan 2013 12:11:42 -0600

The Federal Trade Commission has been investigating Google's practices in regard to patent licensing, search results and other matters for about two years. The FTC sought to determine if Google's practices in these regards were anti-competitive. The FTC ended their investigation the first week of this year and entered into an agreement with Google in exchange for the FTC agreeing not to pursue the matter further.

Part of the analysis by the FTC was a investigation into whether Google manipulated its search algorithms such that websites that competed with Google's "vertical" results (i.e. sponsored Google sites) were moved down in the search results with concomitant damages to the click through rate to such competing sites. The FTC found that even though "...some of Google’s rivals may have lost sales due to an improvement (sic) in Google’s product...(t)he totality of the evidence indicates that, in the main, Google adopted the design changes that the Commission investigated to improve the quality of its search results, and that any negative impact on actual or potential competitors was incidental to that purpose." The Commission went on to say "...these changes to Google’s search algorithm could reasonably be viewed as improving the overall quality of Google’s search results because the first search page now presented the user with a greater diversity of websites."

Needless to say, not all were enamored with the FTC's actions. Microsoft, having been kicked around by the FTC for years, bemoaned the actions as "weak". Others found it to be totally justified.

Whatever your view, this is a win for Google and clears up their docket to proceed with their pursuit of world domination. Not that there's anything wrong with that.

Are Confidentiality Provisions and I.P. Assignment Clauses In Employee Agreements To Be Treated Like Non-Compete Provisions? South Carolina Supreme Court Says No.

Paul Stanfield — Thu, 03 Jan 2013 14:18:38 -0600

Almost every technology company of any variety has a couple of standard provisions in the documents that their employees sign as part of the employment on-boarding process. Those are, of course, provisions that require the employee not to divulge certain information that they learn as a result of their employment and that provide that any intellectual property developed by the employee during the employment (and often for a period thereafter) and based on information provided by the employer, belongs to the employer. Some agreements also contain non-compete provisions, which purport to prohibit the employee from engaging in certain kinds of employment activity after the present gig ends.

Mr. Morin went to work for Milliken & Company in South Carolina as a research physicist and worked for Milliken for nine years developing fibers. Apparently, Mr. Morin began to make plans for his own company prior to leaving the employee of Milliken and filed for a patent on a new fiber within a few months after resigning from Milliken. Milliken thought such behavior was untoward and filed a suit against Mr. Morin for breach of the confidentiality provisions and the breach of invention assignment provisions in his employee contract, among other things.

The appeal of this case recently found its way to the Supreme Court of South Carolina. One of Mr. Morin's principal arguments was that the confidentiality provisions and the assignment of inventions provision were restraints of trade and as such, should be reviewed under the same standard as a non-compete provision, i.e. not favored by the courts and construed against the employer unless certain very stringent requirement were met.

The South Carolina Supreme Court disagreed with Mr. Morin and found that such provisions (confidentiality and invention assignment) were not restraints of trade and as such, were to be reviewed under the reasonableness standard, i.e. to be enforced as an ordinary contract provision unless the provisions exceeded what was necessary to protect the legitimate interests of the employer. The court held: "We therefore hold confidentiality and invention assignment clauses are not in restraint of trade and should not be strictly construed in favor of the employee."

This confirms what most of us in this industry believed to be the law and should make it easier for well crafted provisions of this nature to be enforced in the future.

USPTO Comes Down Squarely Somewhere On the Sliding Scale of Scandoulousity. Why Is C**ksucker More "Scandalous" Than Big P*cker?

Paul Stanfield — Wed, 02 Jan 2013 13:24:03 -0600

Section 15 U.S.C. § 1052(a) prohibits the registration of a trademark that is "...immoral, deceptive, or scandalous".

In September of 2001, Ms. Marsha Fox, an enterprising marketeer, applied for a trade mark for "Cock Sucker" accompanied with a picture of a male chicken. This mark was to be applied to a chocolate candy sucker shaped like a rooster. The target market was likely followers of college teams with Game Cocks as a mascot, such as the University of South Carolina, who have displayed a consistent fetish with double entendres relating to the work "cock" even though the original reference was to a Revolutionary War hero, Thomas Sumter, for his small size and fierce attitude.

The USPTO rejected the application by finding that it was scandalous or vulgar. The USPTO recognized that there was a non-vulgar meaning to the phrase but that the vulgar meaning was so egregious that it overrode the right of the applicant to register the mark. This was true even though the USPTO has allowed such marks as "Big Pecker", "Tits", "Big Cock Ranch" and "Cock Rub". The Court neglected to consider that an alternate meaning to Cock Sucker might be to refer to the people who shell out good money to purchase such a confection, although I am sure they are preferred party favors at fraternity parties all over Columbia.

Right before the holidays, the Court of Appeals for the Federal Circuit upheld the USPTO's rejection, including rejecting a First Amendment argument because the court reasoned that the applicant could still use the mark, she just couldn't register and protect it.

So, where does this leave the aspiring applicant of a killer mark that has both a scandalous and non-scandalous meaning? Good question. If you can make a distinction on any of these, it would seem that if it is listed in the Urban Dictionary as a sex act, it is in peril. If it is only a reference to a body part, maybe a little safer. The USPTO will let you know when they see it.

UPDATE: Ownership of Company's Twitter Account: Company vs. Employee

Paul Stanfield — Tue, 11 Dec 2012 14:42:38 -0600

Almost a year ago, we mentioned the unusual case of PhoneDog v. Kravitz, where a former employee was sued by his former employer for $340,000, which amounted to $2.50 per Twitter follower that the employee took when he left the company.

We indicated that this was a gray area and developing. So, how did PhoneDog v. Kravitz enlighten us on the rules for this situation? Exactly none. Mashable reports that the parties have settled after months of mediation. Settlement terms are confidential but apparently Mr. Kravitz retained the Twitter followers and there was no indication of money changing hands.

Where does this leave us? Back at square one but with some lessons learned. For example, if ownership and control of Twitter accounts is important to your business, state in the employment contract or the employee manual that such accounts belong to the company. Eliminate any drama by addressing the issue head on. #commonsense

In Your Face, Privacy!

Stuart Hiserodt — Fri, 14 Sep 2012 12:42:38 -0600

I'm lazy. That's the only answer I can come up with. There are coupon, discount, and "my awesome deal" websites cluttering my inbox every morning, and for the life of me I can't seem to remember or care enough to take advantage of all this free money. I'm not a technophobe - far from it. I've used Google deals, Facebook deals, aDealio, and Groupon when I'm getting a massage, sometimes a car wash, or when I'm all out of ideas for lunch. But with all the deals out there part of me has given up and decided it's easier to pay the extra 15% rather than wade through all those sites.

Enter my savings savior, Red Pepper and their new facial recognition software, Facedeals. Facedeals, proposes to assist with my Facebook check-ins by performing a facial recognition match by way of their fancy, magic camera box. Through this facial sorcery, I'm automatically checked in and then I'm sent a text with the available deals. Fantastic! Right?!

With the exception of the two weeks of SXSW, I can never muster the strength of summoning Foursquare or Facebook to let my friends know where I am or what deals might be around the corner. Finally, I can end the torture that is unlocking my iphone, finding the check-in app, finding the right location, and thinking of something witty to say ... then doing it all over again with my deal app. Yes, this type of laziness falls under the first world problem category, but the thing is, that's probably what it's going to take for me to actually redeem that coupon for 10% off all fish taco appetizers (on every 3rd Tuesday).

My first thought as an attorney was ... hurry up and change your name before Facebook sues you! See other Facebook victims here, here, and here. Fortunately, they recently posted a statement indicating no affiliation with Facebook and that they are changing their product's name. Well done, Red Pepper, well done. I hope that's enough golden fleece to cover the dragon's eyes.

My next thought was ... isn't there some type of privacy concern here? There's a video camera outside of each bar checking me in? What exactly is that little wizard camera box doing? As I would expect, Facedeals states that it is opt in procedure, meaning permission must be granted before Facedeals blabs about you going into a bar at an inappropriate time and/or with inappropriate frequency. Anyone who has signed up for Spotify can attest to the difficulty in broadcasting their listening habits to their friend circle.

So are they violating our privacy? Ultimately, the Constitution and case law provide us with our basis for privacy law, but each state maintains privacy statutes that fine tune the proper interactions with those rights. For example, think of recording conversations, state laws differ on whether both parties to a recorded conversation must be aware of the recording. Therefore, an overgeneralization is difficult, but the "dangerously close to malpractice" take on this is that if you don't have an expectation of privacy then there is no privacy. When you're in public walking on a public street you can't expect that information to be protected by law, as opposed to being in your house with the shades drawn or in private establishment whispering to your friend.

The Facedeals program doesn't seem to record sound and faces the street, so it appears to coincide with the legal expectation of privacy, but how will people react? My thought would be that the reaction will be predicated on what the program does and how it is used. The basic premise is great and handy, but will this start the slippery slope to a continued monitoring of our actions? What if someone hacks into the system like some Ocean's 14 plot? I watched the Wire, don't we already have cameras on every block?

Although I'm a bigger fan of privacy than I am a cheap steak bite, I could see myself using the app when walking around a new area ... as long as I can edit my notifications to "Only Me". The lazy guy who wants help checking in is interested to see how well the facial recognition software works and the lawyer in me wants to find out what the program is doing once it scans my face (even if I haven't signed up).

Having An Open WiFi Does Not Ipso Facto Make You Liable For Negligent Infringement.

Paul Stanfield — Thu, 13 Sep 2012 16:11:26 -0600

Here's the scenario: You have an open WiFi (i.e. no password required), someone (maybe you, maybe not), uses that IP address to download a copyright work, someone (probably a copyright troll) sends a subpoena to your internet service provider and finds that this happened, you receive a letter from a copyright troll attorney that says in basic terms: "You are a horrible person. A copyright protected work was illegally downloaded using your IP address. It was entitled something that included "hot", "wet" and a bodily orifice in the title. You should be ashamed and if you pay me $3,000 now, it will all go away and your wife/girlfriend/scout troop/sunday school class will never know. Otherwise, we can sue you for negligence because your WiFi was not protected and we don't even have to prove you did the download."

Maybe this comes as a huge surprise to you, maybe it doesn't. However, will the negligence claim fly and allow the trolls to tag you with liability even if they can't prove you actually did it? A couple of courts have said no. Last week the U.S. District Court for Northern California in a case styled AF Holdings LLC v. John Doe and Josh Hatfield held that the mere inaction of not protecting your WiFi was not negligence because the defendant did not owe a duty to the plaintiff to take an affirmative action to protect the plaintiff's intellectual property. In addition, the court held that this was still a copyright case and state law of negligence was preempted by the federal copyright statute. And to further make a point, the court found immunity for the defendant under Section 230 of the Communications Decency Act.

So, it seems to be the trending opinion that you aren't strictly liable for contributory infringement for just leaving your WiFi open. Seems right to me.

We're Back After The Hack.

Paul Stanfield — Wed, 12 Sep 2012 14:48:16 -0600

Regular readers of this blog (Mom and that other guy) have noticed recently that we have not had any posts of late. One of the reasons (in addition to inertia and inherent laziness) was that we were visited by hackers. One day we opened the site and in place of our erudite post about the color of a baseball glove giving rise to trademark infringement we found a notice telling us we had been hacked.

This notice was from some one professing to be a representative of an organization supporting the superiority of a particular race. We also had a symbol that we couldn't decipher accompanied by the playing of old German marching songs.

All in all, very festive but disconcerting. So, we're back and committed to offering you the excellence in writing to which you have become accustomed.

Good to see you again.

Lewis Vuitton Loses One, Louis Vuitton Wins One.

Paul Stanfield — Mon, 16 Jul 2012 12:16:06 -0600

We all know that Louis Vuitton is very aggressive in protecting their intellectual property. We noted that they were successful in obtaining a large judgment from the operators of a San Antonio flea market for contributory infringement.

They have continued their protective efforts unabated and two recent decisions provided them with mixed (although perhaps justified) results.

First the victory. Louis Vuitton had filed a case against in Federal District Court in Nevada against 182 websites and 1,000 "John Does" for infringement of Vuitton's rights by manufacture, advertising and sale of Vuitton knock offs. The Court granted Vuitton a temporary restraining order against a number of the defendants, finding a strong likelihood of success at trial by Vuitton and that immediate and irreparable harm would accrue to Vuitton without the TRO. Louis Vuitton Malletier, S.A. v. 1854louisvuitton.com, et al., 2012 WL 2576216, (D.Nev., July 3, 2012)

Now the loss. In Louis Vuitton Malletier S.A. v. Warner Brothers Entertainment Inc., 2012 WL 2248593 (S.D.N.Y. 2012) a New York court ruled that Vuitton's reach had exceeded its grasp when it sued Warner Bros. for referring to a knock off in The Hangover II, even though Zack Galifianakis referred to it as a "Lewis" Vuitton and it was on the screen for less than 30 seconds. The Court found that the use in this case was protected by the first amendment and was unlikely to cause any confusion.

By the way, "malletier" is french for luggage maker. I had no idea.

New Top Level Domain Names. Coming Soon To A Browser Near You.

Paul Stanfield — Wed, 13 Jun 2012 14:39:37 -0600

We have discussed before the new ICANN Top Level Domain scheme, whereby the initial regimen of .com, .net, .edu, etc. could be supplemented by any word to which an approved registrar gets the rights. We joked that we were going to apply for the .law domain. We came up a little short on our aluminum can drive to get the $185,000 necessary for the application but obviously someone is reading our blog because ICANN released a list of the applications today and six entities have applied for the .law domain name. If that wasn't enough, there were two applications for .lawyer, two for .legal, one for .esq, one for .attorney and one for .abogado.

A review of the proposed strings probably provides a commentary on contemporary society, but you can make that evaluation. The following are some of the applications and the number of applicants for such strings:

13 applications for .app
1 application for .bible, but none for .koran, although there is 1 for .catholic and 1 for .islam
The applications are as divided as the country with 1 application for .democrat and 1 for .republican
In the organized entity arena, there were 10 applications for .inc, 9 for .llc, 4 for .llp, 4 for .gmhd and 7 for .ltd
There were 6 applications for .tech, 7 for .web and 7 for .cloud
On the family front there were 3 applications for .mom and only 1 for .dad. That sounds about right.
For all the adults, there was 1 application for .porn (there already is a .xxx domain), 2 for .sex and 1 for .sexy
There was 1 application for .gay and no applications for .straight
There were numerous applications by corporations for the corporate extension, like .canon, .dell, .firestone and .csc
And in the "I've got $185,000, I don't need right now" category, there was 1 application for .wtf and 1 for .unicorn.

There now follows a 60 day comment period and a 7 month window for filing an objection to any application. Anyone want to oppose .cialis? You can only do that after 4 hours.