Ramsey v. Harman, — S.E.2d —-, 2008 WL 2415127 (N.C.App. June 17, 2008)

Defendant Harman maintained a blog on which she put up some posts accusing plaintiff Ramsey’s daughter of being a bully. Harman also posted this:

With all the bulling [sic] and harassing that goes on in our school system. Then the trouble that went on Friday at Madison Middle. The first student in that age group that came to mind was [plaintiff]’s daughter. Wasn’t this the student that harassed the Cantrell child? And we wonder why some kids hate to go to school…..

Ramsey apparently took great offense, filing suit against Harman for “stalking” under North Carolina law, and sought a “civil no-contact order” (like a restraining order) against Harman. The trial court granted the no-contact order and Harman sought review with the state appellate court. On appeal, the court reversed.

Harman argued that the lower court erred in finding that she had violated the state’s anti-stalking law (N.C. Gen. Stat. §50C-1(6)). She also argued the order violated her First Amendment rights. Because the court found there was insufficient evidence to support a violation of the statute, it did not need to rule on the constitutional issue.

The main question before the court was whether Harman’s blog posts were intended to cause, and indeed did cause, “substantial emotional distress” to Ramsey and her daughter. The court found there was no such showing. There were no threats of physical harm, and the only evidence as to the effect on the plaintiff’s daughter was that she was “embarrassed” when teachers at school were reading the blog posts. But there was evidence that the school had blocked access to the website, making the claim implausible to begin with. There were no communications directly between the defendant and the plaintiff, and the plaintiff’s daughter’s name was never mentioned. Moreover, there was evidence that the posts were made in retaliation over a disagreement between the Harman and Ramsey which had taken place on a political website, and over an alleged threatening phone call Harman had gotten from some of Ramsey’s family members.

Ruiz v. Gap, Inc., 540 F.Supp.2d 1121 (N.D. Cal. March 24, 2008)

In 2006, Ruiz applied for a job at the Gap and was required to provide his Social Security number. A vendor hired by the Gap for recruiting stored Ruiz’s information on a laptop which, as luck would have it, was stolen.

Though he was not (at least yet) the victim of identity theft, Ruiz sued the Gap for negligence. The Gap moved for judgment on the pleadings which the court also treated as a motion to dismiss for failure to state a claim. The court denied the motion to dismiss as to negligence (and granted the motion as to claims for bailment, unfair competition and violation of the California constitutional right to privacy). But Ruiz’s standing to bring the claim was tenuous.

The Gap had argued that Ruiz lacked standing. His only alleged harm was that he was at an increased risk for identity theft. The court’s analysis of the Gap’s objection to standing focused on the first element of the Lujan test (Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992)), namely, whether Ruiz’s alleged injury was “concrete and particularized.”

The Ninth Circuit has held for allegations of future harm to confer standing, the threat must be credible, and the plaintiff must show that there is a “significant possibility” that future harm will ensue. The Lujan case (which is the leading Supreme Court authority on standing) essentially creates a “benefit of the doubt” for plaintiffs at the pleading stage — a court is to presume that general allegations embrace those specific allegations that are necessary to show a particularized injury. Ruiz’s general allegations of the threat of future harm were thus sufficient to confer standing.

But the court gave a warning to Ruiz that the threshold of standing does not apply only to pleadings, but is an indispensable part of a plaintiff’s case throughout. In other words, he’ll have to come up with more later to keep the case in court.

So in denying the motion to dismiss the negligence claim, the court incorporated its standing analysis. The only issue on the point of negligence was whether Ruiz had suffered an injury. Ruiz’s general allegations were sufficient.

Saturday, April 26, 2008 marks the ninth annual World Intellectual Property Day. Begun in 2000 by the World Intellectual Property Organization, World IP Day aims to illustrate the benefits of and cultivate respect for IP. WIPO’s Director highlights this in a message noting that IP development and protection contributes to new technologies and an overall richer human experience for everything from the means to tackle global warming to watching the world wide broadcast of the Olympic games, and that IP nurtures human creativity, while fostering cultural, economic, and social development. From the telegraph to the Internet, IP increasingly connects the world.

Each country celebrates World IP Day in its own way, and a list of scheduled activities can be found here; a list of suggested activities such as concerts, essay-writing contests, and general awareness-building activities can be found here. A gallery of past and present artwork celebrating World IP Day is available here (this year’s poster here).

…check out page 54 of the November 2007 issue.

Update: Here’s a link

I’m in this week’s episode of Viral on Veoh, talking about the right of publicity. Check it out below (or click through if it’s not showing up the RSS feed):

Online Videos by Veoh.com

Frees, Inc. v. McMillian, No. 05-1979, 2007 WL 2264457 (W.D. La. August 6, 2007)

Plaintiff Frees, Inc. filed suit against two of its former employees, McMillan and Pierceall for, among other things, violation of the Computer Fraud and Abuse Act (”CFAA”), 18 U.S.C. 1030. Frees alleged that McMillian and Pierceall loaded Frees proprietary data onto their new employer’s computers, which they then used to develop and market products in competition with Frees. Frees also alleged that McMillian deleted data from the Frees computers before he left its employment. This alleged conduct resulted in Frees expending more than $16,000 to various consultants and forensics investigators. Frees did not suffer any interruption of service.

McMillan and Pierceall moved for partial summary judgment. They argued that Frees had not alleged “loss” as defined under the CFAA, and in the alternative, that Frees could not recover lost profits absent an interruption of service. The court denied the motion.

“Loss” under the CFAA

Frees had argued that the “loss” it suffered was the fees it paid the consultants and forensics investigators it had to hire because of the deletion of data from its computer systems. The defendants argued that these expenditures were not cognizable as “loss” under the statute. The court rejected that argument, citing to a number of cases from around the country holding that the costs associated with investigating possible damage to a computer system are considered “loss.” Citing to E.F. Cultural Travel BV v. Explorica, Inc., 274 F.3d 577, 585 (1st Cir.2001) the court observed that a finding of “loss” is not lessened simply because no damage occurred.

No interruption of service

The defendants contended that lost revenues were not compensable damages in the case because there was not an interruption of computer service. They argued that the phrase “any revenue lost, cost incurred, or other consequential damages incurred because of interruption of service” was not only a jurisdictional threshold, but also a limitation on the types of recoverable damages. 18 U.S.C. § 1030(e)(11). Frees rejected that contention, arguing that a plaintiff is entitled to recover ordinary “compensatory damages” once the jurisdictional threshold has been met.

Recognizing that the federal circuits are split on this issue, the court sided with Frees. The court found that the terms “damage” and “loss,” appearing in the CFAA, are terms of art used to define a jurisdictional threshold. They do not control or limit what damages are available in a civil action if the substantive and threshold standards are not met. Rather, the court found, Congress used the terms “compensatory damages” and “economic damages” in the CFAA to define the scope of recovery.

Merle Norman Cosmetics, Inc. v. Labarbera, No. 07-60811, 2007 WL 2254932 (S.D.Fla. August 03, 2007)

Cosmetics purveyor Merle Norman sued defendant Labarbera in a Florida federal court, alleging state law claims for tortious interference with contract, civil conspiracy, and deceptive and unfair trade practices. Merle Norman alleged that Labarbera worked in conjunction with an authorized Merle Norman studio owner to obtain cosmetics which she later resold on eBay.

Labarbera moved to dismiss under FRCP 12(b)(6), arguing that the “first sale doctrine” protected her right to resell products she had lawfully acquired in the stream of commerce. Merle Norman responded that the first sale doctrine should not apply, as the doctrine only protects defendants for claims of intellectual property infringement. In this case, Merle Norman argued, the defendant was not merely reselling the products, but was engaged in tortious conduct with the authorized studio owner.

The court agreed with Merle Norman and denied the motion to dismiss. Quoting Bulova Corp. v. Bulova Do Brasil Com. Rep. Imp. & Exp. Ltd., 144 F.Supp.2d 1329, 1331-1332 (S.D.Fla.2001), it observed that “[c]ourts have limited this doctrine to cases where there is no other conduct of infringement or where the defendant is not culpable for anything more than mere reselling of a product.” The court went on to observe that “the point at this early stage of this litigation is that the First Sale Doctrine has not been accepted as a complete defense to tortious interference and civil conspiracy claims.”

View the opinion below (or click through if it’s not showing up in the RSS feed):

Last week’s rumors are confirmed — Google is in the closing stages of a $100 million deal to purchase Feedburner. What great news for this terrific Chicago company. And congratulations to my friend Rick Klau, who has been on board with Feedburner for a couple years as VP of Publisher Services, and who no doubt has been an instrumental force in the company’s success. Wow.

Earlier today I spoke on the topic of YouTube and copyright at a conference on intellectual property law at Chicago’s John Marshall Law School. Here are my materials available for download: [handout materials] and [PowerPoint slides]. For convenience, I’ve converted both of the files to PDF.