Internet Law

A few days ago I recieved an e-mail about a class action lawsuit, today I recieved two mailings about it one addressed to me, the other one of my LLCs. Since it appears any US resident/company advertising on Yahoo Search Marketing has recieved this, I am going to comment on it.

The search engines are feeling a lot of pressure over click fraud right now. Its a multi-billion dollar industry so obviously it is going to attract trial lawyers. Last week Google released a report refuting many of the click fraud claims that click auditing companies, such as Adwatcher have made. (For the record, I use Adwatcher, and I have recieved refunds from PPC companies based on the data it has collected.)

Since Google has been the main target it is not suprising that Yahoo has now also come under the crosshairs in this Checkmate vs Yahoo! Inc suit filed in California (by a Florida corporation against a Delaware corporation.. interesting.)

I was reading over the papers and found this very interesting:

“..including improperly collecting revenue by charging and/or overcharging Class Persons for clicks that were click fraud, click through fraud, fraudulent clicks, click spam, invalid clicks, unwanted clicks, unqualified clicks, improper clicks, non-converting clicks, inadequately converting clicks, clicks that were not reasonably expected by Class Persons or otherwise claimed by Class Persons as clicks for which Class Persons should not have been charged, and improperly collecting revenue by charging and/or overcharging Class Persons for clicks where users did not actively choose the Class Persons’ listings”

May be I’ve been in the dark, but since when is “unqualified clicks, improper clicks, non-converting clicks, or inadequately converting clicks click fraud?

I was thinking about this and I may have an explanation. One thing I have noticed with Yahoo Search Marketing is they like to change your ad copy for you. I have had both title and description mysteriously turn in to something I did not submit nor approve — and I have heard others say the same.

As usual, this just looks like a case to make some trial lawyers millionaires and hand out the actual plantiffs a couple of dollars (or coupons.) I’m not participating.

Last year I was curious about how the Weblogs Inc network of blogs (Engadget, Autoblog, Luxist, etc.) recieved permission to use other people’s images on every one of thousands of blog posts. Certainly they did not have time to request and wait for permission from every single web site?

Looking for an answer I sent an e-mail to Shawn Gold at Weblogs Inc (who left AOL in February of this year.):

“I’m curious about the legal issues with the images used in Weblogs Inc’s blogs. I notice that nearly all images are hyperlinked to their original source. Do the bloggers ask permission to use each individual photo, or is there some kind of fair use issue going on here?”

The reply from Shawn came back 2 days later:

“Hi Andrew;
There are fair use issues with images…we do it like google, use a smaller image than the origianl and link to the original source.Don’t have the time to ask permission for every image. You can google fair use on images or even search googles image practices and you will get the skinny.”

I was correct, they were using the fair use defense.

Far from being a lawyer, I am not 100% certain this would hold up. First of all, the images are big. Google Images max out at 124 pixels wide, Google News at like 79 pixels. These are thumbnails. Weblog Inc’s 425 pixels wide might be a bit of a “stretch” for fair use… considering that image fair use has been called in to question over mobile right use, things are even greyer.

Typically companies like Weblogs Inc get away with this because #1 with the exception of very dumb companies, everyone loves free traffic, especially from a huge and influencial site like Endgadget. #2, very few companies register the copyright of an images, which costs $30 a pop. Thats right, you can register the copyright of an entire book for the same cost as a single photograph.

Considering many photographers would be lucky to average $30 for every image they take, registering the copyright would send them in to bankruptcy. If the copyright is not registered, infringement damages are greatly reduced meaning a hiring a lawyer results in an even bigger loss.

I am not writing this to attack Weblogs Inc or anyone at AOL. Rather, that the legal system is a complete mess. These issues create a minefield for internet publishers who want to play the whitehat game without hiring very expensive lawyers.

EFF, where are you?

If you have been an active reader of my blog, I alerted you about this bill back in May.

On Thursday the US House of Representatives passed a law the Deleting Online Predators Act 410-15. As I speculated earlier, and CNET confirms, the wording of this law effectively bans any site where a user can publish and/or communicate with others from being accessed in schools and libraries. Adults can ask permission to use them. The law targets Myspace and chatrooms, but loops in everything including forums, Amazon.com, blogs, and the list goes on.

All of this talk about the digital divide may come true after all.

From a reasonable perspective this law will probably just be struck down as unconstitutional. Being that an election is approaching rapidly this was expected. It is unfortunate that the people who represent us neither read the bills or have any understanding of what they are regulating.

From the UPI — “The bill terms a social-network Web site as one that allows users to create Web pages or profiles about themselves as well as offers communications including a forum, chat room, e-mail or instant messenger.”

A vBulletin forum is simply a forum, but it also allows users to create a profile page about themselves. Several plug-ins are available that renders this profile page virtually identical in form & function to Myspace.

Other bloggers have pointed out that this could also include everything from blogs to photo-sharing sites such as Flickr.

Cnet’s News.com reports that this bill is part of a drive by Republicans to capture the interests of suburban voters in preparation for the fall election.

If you read my post on a New Jersey bill that would have made anonymous forum posting illegal, there is good news:

“We veered out of our comfort zone with this one,” Ross said. “We’re usually open space, quality-of-life kind of guys. We veered into technology and we were pretty much taken off guard when got hit with a couple hundred e-mails last week.” …Biondi is anticipating a legal opinion from his state legislature’s nonpartisan research division by the end of this week.

If you didn’t care about affiliates losing money from accidental DMCAs by Perfect 10, this story might catch your attention. The holder of the trademark “Sweet Pea” is sueing 51 users of CafePress for infrindging on their trademark. The defendants have the option of handing over $5,000 or going to court and risk a multi-million dollar judgement.

Unlike Google’s lawsuit, this lawsuit is in fact quite legitimate. Trademarking phrases for use on clothing is not uncommon. Remember the story aboutParis Hilton trademarking the phrase “Thats hot”? (may be this CafePress user should be worried.)

In fact, unless a trademark holder enforces their mark they could lose it. Thats too bad for the CafePress affiliate who sold a $5 item and is convinced trademarking two words isn’t possible.

Warning, links in this story lead to adult content

As I reported earlier, a Judge a has ruled Google infringed on Perfect 10′s copyright through Google Images. Here is DMCA notice Perfect 10 sent Google listing sites to remove from Google Images along with the search terms.

Although the news stories made it appear that these websites were directly stealing Perfect 10′s copyrighted images, after reviewing the DMCA notice and reading complaints on several webmaster forums I have learned otherwise. In fact, many of these websites were using content given by Photographer’s website affiliate programs to program their program. Apparently, these photographers have shot content for Perfect 10 at some point in the past.

I do not see how Perfect 10 could have spent perhaps hundreds of thousands of dollars sueing Google and not have known these photographers had their own premium internet sites.

In fact, it gets worse. A specific site owner claims that they were approached by Perfect 10 who requested specific models and specific images.

Based on what I have read from site owners, I am of the opinion that the following happened:

In my opinion, Perfect 10 purchased the rights to specific images that were ranking on Google, with the intention to sue Google, and possibly even the affiliates who were using these images; affiliates who had no reason at all to believe they were infringing on anyone’s copyright.

A individual representing another affiliate program stated that Perfect 10, in December, approached them to purchase specific images. Not only did Perfect10′s DMCA request include that program’s affiliates, but also the website of the affiliate program itself! Here is the direct quote made on a public adult webmaster board (warning, adult content on link)

Perfect10 makes the big mistake of including 105 of our affiliates in their DMCA notification to Google: http://www.chillingeffects.org/notice.cgi?sID=898. They even listed our own affiliate program domain as a copyright infringer : http://www.newnudecash.com/ . Google’s reaction was to randomly block some of the sites listed, and therefor some of you have lost your sites main page listing at Google.

If what is stated is true, and these images were simply “licensed” to Prefect 10, rather than the copyright being sold, they are not even in legal a position to issue a DMCA request!

I did not create this blog to cover the adult industry, However, I believe this story is extremely important for two reasons. First, mainstream or adult, how can affiliates know what an affiliate program owner is doing won’t cause them legal problems or hurt their business? (while the affiliates themselves were not sued, many did lose lots of money due to loss of search engine traffic, my understanding is that for a time entire domains were banned.) Second, this appears to be a case of a company specificly laying a trap in order to sue Google, in a case which could have dramatic implications to fair use on the internet.

From Reuters UK:

A group representing global newspaper publishers has launched a lobbying campaign to challenge search engines like Google that aggregate news content…The Paris-based World Association of Newspapers, whose members include dozens of national newspaper trade bodies, said it is exploring ways to “challenge the exploitation of content by search engines without fair compensation to copyright owners.” Web sites like Google and its specialised Google News service automatically pull in headlines, photos and short excerpts of articles from thousands of news sources, linking back to the publishers’ own site. Google News does not currently carry advertising.

I guess free traffic isn’t good enough compensation?

When Microsoft and Yahoo complied with the DoJ’s request for search data they did not turn over any personally identifiable data, so they claim.

“Google’s acceding to the request would suggest it is willing to reveal information about those who use its services,” Ashok Ramani, a lawyer representing Google, said in a letter to the Justice Department. “This is not a perception that Google can accept.”

The move to web-based applications and centralised information storage has raised many concerns not only with privacy advocates, but those concerned with security. Phising and hacking are already big threats to online users. Un-warrented Government intrusions simply add to the mess.

Forget search history, Google is already storing massive levels of e-mail data on their servers. Its not inconceivable that every e-mail you send and recieve in your whole life could be stored in a centralized location. Thats a goldmine not only for criminal investigators but also civil suits and hackers.

I believe the solution is a user-side encryption key, perhaps a USB stick, that allow users to store their online data using high-level encryption. Yet even this raises problems. Google likes to read their data. Terabytes upon terabytes of information allows for deep data mining and the ability to extract all kinds of statistics to help make their company more profitable.

Whatever the future holds for Google and the other search engines, consumers are going to demand security as we move to a global desktop. Too bad there are probably hundreds of patent holders ready to sue the first company that actually brings a workable solution to consumers.

I was hoping for some good news on my return, but unfortunately have come home to this: the Department of Justice subpoenaing Google, not in a criminal investigation, but in order to support a law that was already struck down by the US Supreme Court as unconstitutional. Worse, MSN, Yahoo, and AOL complied with the original request without hesitation — records for all search results in a one week period.

Here is were things really get messy. Yesterday the Wall Street Journal had an article on new internets created by other countries seeking more independance. If you have been following the news over the past few months, there had been a move, which was rejected, to ceed control of the Internet primarily from US hands to the United Nations.

I wish I had this article in front of me but I don’t right now. The best I can remember it, the Wall Street Journal article had quoted a US government official as saying one of the best reasons that the United States should keep control of the internet is because of freedom of speech and lax regulations which have allowed the internet to grow very rapidly. Many other countries, such as China, don’t take this same viewpoint.

No one wants China or any other country that suppresses free speech to have a say in how the Internet, world wide, is run. I believe that this move by the Department of Justice is purely political. Remember, this law was already struck down as unconstitutional. However, continued pressure will cast serious doubt on the United State’s ability to continue to allow for a free and open internet.

Read more about this over at Boing Boing.