Court declines expanding reach of antitrust laws to cover DSL and telephone services

The U.S. District Court for the Southern District of New York has granted defendant Verizon’s motion to dismiss in the case of Greco v. Verizon Commumications, Inc., holding that the effect of the antitrust laws should not be expanded to prohibit Verizon from refusing to provide DSL service to customers of competing local telephone providers.

Upset that Verizon offered its DSL service only to customers who also purchased its local phone service, Plaintiff Greco filed a class action antitrust lawsuit. Greco claimed, among other things, that this conduct of Verizon violated §2 of the Sherman Act by monopolizing local phone service. Verizon moved to dismiss, and the court granted the motion.

At issue was whether the court should extend the reach of the antitrust laws to force a “telecommunications monopolist” such as Verizon to deal with certain customers. The analysis relied heavily on a previous case involving Verizon, the 2004 Supreme Court decision of Verizon Communications, Inc. v. Law Offices of Curtis V. Trinko, LLP, (540 U.S. 398, 406 (2004) (“Trinko” ).

The Trinko case had dealt with the question of whether Verizon had violated §2 of the Sherman Act where it had allegedly discouraged customers from dealing with its rivals through various means. In that case, the court declined to apply §2, “because of the uncertain virtue of forced sharing and the difficulty of identifying and remedying anticompetitive conduct by a single firm.” The Trinko court considered four factors, which the court also considered in the present case: (1) the costs versus benefits of antitrust intervention; for example, whether judicial intervention would risk distorting investment, (2) whether the requested relief would require a court to assume a role for which it is “ill-suited,” i.e., to thrust it into the role of a “central planner,” (3) whether remediation would require “continuing supervision of a highly detailed decree,” and (4) whether there exists a “regulatory structure designed to deter and remedy anticompetitive harm.”

In declining to expand the reach of the antitrust laws in the present case, the court focused on how daunting it would be to figure the amount of damages to which the plaintiff would be entitled. For example, the court would have to consider such details as what amounts had been spent on running wires to a customer’s home (including securing rights of way, digging trenches or placing poles, and running wire underground or along poles), and how such costs should bee allocated among unbundled services. The court noted that such allocation of costs is a highly complex and hotly contested issue, and that it was thus ill-suited to redress the alleged injuries.

Greco v. Verizon Comm., Inc. (2005 WL 659200 (S.D.N.Y., March 22, 2005)

Willful copyright infringement constitutes “purposeful direction” in personal jurisdiction analysis

The U.S. District Court for the Northern District of California has confirmed that a defendant subjects itself to specific personal jurisdiction in a forum when it (1) willfully infringes the copyright of a resident of that forum, and (2) knows the plaintiff’s principal place of business is in that forum.

Brayton Purcell LLP, a California law firm, sued Recordon & Recordon, another California law firm, for copyright infringement in the Northern District of California after discovering that Recordon & Recordon had allegedly copied several pages of Brayton Purcell’s website and posted them on its own site. Brayton Purcell is located in the Northern District of California, while Recordon & Recordon is located in the Southern District.

Recordon & Recordon moved to dismiss for lack of personal jurisdiction. Because defendant is a resident of the forum state, the court noted that (a la Pennoyer v. Neff) personal jurisdiction was not at issue, but construed defendant’s motion as one challenging venue. Acting under Ninth Circuit authority interpreting the venue provision for copyright matters (28 U.S.C. §1400(a)), the court applied a personal jurisdiction analysis to answer the question of whether venue was proper in the Northern District.

The analysis eventually became one of whether the court could exercise specific personal jurisdiction over the defendant. One of the elements that must be proven to substantiate specific personal jurisdiction in a copyright infringement action is that the defendant purposefully directed activities to the forum. Proof of such “purposeful direction” satisfies the “effects test” set forth in Calder v. Jones, 465 U.S. 783 (1983). In this case, the court applied the powerful jurisdictional holding of Columbia Pictures Television v. Krypton Broadcasting of Birmingham, Inc., 106 F.3d 284 (9th Cir. 1997) to conclude that defendant had made such a purposeful direction of activity.

In the Columbia Pictures case, the Ninth Circuit held that the defendant subjected itself to personal jurisdiction in another state where it had “willfully infringed copyrights owned by Columbia, which as [the defendant] knew, had is principal place of business in [the forum district].” The court in this case concluded that Columbia Pictures was directly on point, and that Brayton Purcell had satisfied the effects/purposeful direction test by making a prima facie showing that Recordon & Recordon willfully infringed Brayton Purcell’s copyrights and by alleging without dispute that Recordon & Recordon knew Brayton Purcell’s principal place of business was in the Northern District of California.

Brayton Purcell LLP v. Recordon & Recordon, — F.Supp.2d —, 2005 WL 639706 (March 18, 2005).

Internet access during trial provides unfair advantage

The New York Workers’ Compensation Board allowed the State Insurance Fund to install a wireless network in the Syracuse office of the Board, enabling the Fund’s attorneys to access their files during proceedings before the Board. Other attorneys appearing before the Board were denied wireless Internet access. The Central New York Workers’ Compensation Bar Association, as well as a couple individual plaintiffs, filed suit against the Board, alleging that its policy to allow the Fund but not other attorneys access to a wireless network was arbitrary and capricious. The trial court agreed, and the decision was affirmed on appeal.

The court held that although the fund is an agency of the State, in litigation it is considered to be a separate entity. Thus, it is of the same status as any other litigant appearing in proceedings before the Board, and not entitled to special treatment.

In affirming that the Board had acted arbitrarily and capriciously by allowing Internet access to the Fund’s attorneys, the court found that:

“The wireless access sought by the Fund provides the Fund an unfair competitive advantage in litigated matters as the installed hardware permits only the Fund’s attorneys access to their case files in the heat of litigation, putting at their fingertips volumes of meaningful exhibits, legal research and other information, with no similar provision for claimants and the myriad of other insurance carriers whose representatives appear before the Board.”

Matter of Central New York Workers’ Comp. Bar Assn. v. State of New York Workers’ Compensation Bd., 2005 N.Y. App. Div. LEXIS 2877 (March 18, 2005).

Time Warner ordered to identify sender of offensive e-mail

In the case of Fitch v. Doe, the Supreme Court of Maine has held that while the Cable Communications Policy Act of 1984 generally prohibits a cable operator’s disclosure of subscriber information, an exception provided in the Act allows disclosure to nongovernmental entities pursuant to court order, so long as the subscriber has received notification thereof.

On Christmas Eve 2003, an anonymous person sent an email under Plaintiff Fitch’s name with a derogatory cartoon attached. Fitch filed suit in Maine state court against the unknown sender of the email (John or Jane Doe). Fitch then sought an order directing Time Warner (the ISP of the account from which the message was sent) to disclose Doe’s identity. Doe’s counsel objected to the disclosure, arguing that the disclosure was forbidden by the Cable Communications Policy Act of 1984, 47 U.S.C.A. § 551 (the “Act”), and that Doe did not consent to allow Time Warner to disclose his identity. The trial court ordered disclosure, finding that Doe’s agreement with Time Warner provided such consent.

Doe appealed to the Maine Supreme Court, but the lower court’s decision to order disclosure was affirmed. Although the court concluded that the lower court erred in determining Doe had consented to disclosure, such disclosure was authorized under an exception found in the Act.

The Act restricts cable providers from releasing information about their subscribers without the consent of the subscriber concerned. Section 551(c)(2)(B) of the Act authorizes disclosure of personally identifiable information if the disclosure is, “subject to subsection (h) of [Section 551], made pursuant to a court order authorizing such disclosure, if the subscriber is notified of such order by the person to whom the order is directed.”

Section 551(h) provides that when a governmental entity is seeking disclosure, it must show by clear and convincing evidence that criminal activity is reasonably suspected. Doe had argued that the reference to Section 551(h) served to “meld” the entire exception into one applicable only when the government seeks information about a subscriber. Because Fitch was not a governmental entity, Doe argued that the exception to the restriction of disclosure should not apply.

The court disagreed, and held that 511(h) served merely to impose a higher standard when the government seeks disclosure of information about a cable subscriber. Because Fitch was not a governmental entity, Time Warner was permitted to release the information in response to a valid court order, so long as it had given notice to Doe. The record established that Doe had received such notice, thus the Act did not bar Fitch’s access to the requested information.

Fitch v. Doe, — A.2d —-, 2005 WL 627569 (S.Ct. Me., March 18, 2005). Podcast — March 18, 2005

This week’s podcast discusses the recent case of Roskowski v. Corvallis Police Officers’ Association, coming to us from the federal district court in Oregon. Here are some links to items mentioned in the podcast:

Download the Podcast
(Approximately 3 minutes, 22 seconds; 1.5 MB)

NYJETS.COM for aircraft leasing doesn’t fly with WIPO panel

An administrative panel of the World Intellectual Property Organization (“WIPO”) has ordered the transfer of the domain name “” to the owner of the New York Jets football team. The panel determined, among other things, that the registrant’s unsupported assertions of plans to use the name for an aircraft leasing business did not prove it had rights or legitimate interests in the name.

NFL Properties LLC and New York Jets LLC brought this WIPO action under the Uniform Domain Name Dispute Resolution Policy, seeking a transfer of from Link Commercial Corp., a company located in the Bahamas. The Complainants argued that (1) the domain name was confusingly similar to the NEW YORK JETS and NY JETS trademarks, (2) the registrant had no rights or legitimate interests with respect to the domain name, and (3) the domain name had been registered and used in bad faith.

The panel awarded a transfer of the domain name. The transfer was ordered, however, only to the New York Jets and not NFL Properties, because the record showed that NFL Properties was merely a representative of the New York Jets regarding licensing and protection of trademark rights. The panel held that “[a]ppointment as a representative to exploit property does not necessarily confer rights in that property on the representative.”

The panel determined that the domain name was confusingly similar to the registered mark NEW YORK JETS. If further determined that Link had not proven it had rights or legitimate interests to use the domain name for an aircraft leasing business. The first mention of one “Norman Yacopino Jets” at came after the NFL and the New York Jets had challenged Link’s ownership of the name. Link had made “unsubstantiated assertions” that its preparation to use the name for this business pre-dated being contacted by the Complainants. The panel determined, however, that such assertions “[did] not constitute evidence of demonstrable preparations.”

In determining that Link had registered and used the name in bad faith, the panel looked to the elevated price Link at which it had offered the name for sale (no less than $2,000), and the fact that Link had a history of registering other domain names in bad faith.

NFL Prop. LLC v. Link Commercial Corp., Case No. D2004-1087 (March 10, 2005).

California court upholds medical board’s authority to post physician disciplinary information

The California Court of Appeal has upheld a trial court’s denial of a petition for writ of mandamus which would have ordered the board to remove from its website information about the plaintiff physician’s past disciplinary record. The physician had argued that certain California statutes (Bus. & Prof. Code §§ 803.1 and 2027) did not permit the board to post information on its website pertaining to the plaintiff’s completion of a probation period. The court held that the plain meaning of the statutes demonstrate that the board is specifically required to post on the Internet information about a physician’s disciplinary history. Furthermore, despite an apparent drafting error in the enacted version of §2027, the court held that a review of the legislative intent also supported the conclusion that posting the disciplinary history was mandatory.

Szold v. Medical Bd. Of California, — Cal.Rptr.3d —, 2005 WL 589433 (Cal.App. 4 Dist., March 15, 2005).

Communications Decency Act provides shield from liability for posting critical e-mail

In the case of Roskowski v. Corvallis Police Officers’ Association, the U.S. District Court for the District of Oregon has awarded summary judgment in favor of defendant, holding that a provision of the Communications Decency Act of 1996 provides immunity to the defendant for the posting of allegedly defamatory email online.

After plaintiff Roskowski resigned from her position as chief of police of Corvallis, Oregon, she filed suit against the Corvallis Police Officers’ Association for defamation. Roskowski claimed that she was damaged by certain anonymous email messages critical of her that were posted on a website that was established by the Association.

The Association moved for summary judgment, which the court granted. It held that Section 230(c) of the Communications Decency Act of 1996, 47 U.S.C. §230(c) provided immunity to the Association. This section of the Act provides, in relevant part, that “no provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”

In awarding summary judgment, the court held that (1) by merely providing a website the Association qualified as a provider of an “interactive computer service,” (2) the website was merely a vehicle for others to post or present their ideas, thus the Association did not control in any way the information provided, and (3) the Association was not a publisher of information as alleged by Roskowski.

Roskowski v. Corvallis Police Officers’ Association, 2005 WL 555398 (D.Or., March 9, 2005)

See also the discussion on of the recent New Jersey case of Donato v. Moldow, 2005 WL 201121 (Ct. App. N.J., January 31, 2005).