Attorney Evan Brown

December 31, 2006 Right of Publicity

Publication of photo on website not a “continuing violation” in right of publicity case

This post is by Greg Smith, a contributor to Internet Cases. [Bio]

In Blair v. Nevada Landing Partnership, a casino worker sued his former employer, claiming that the casino used a photograph of him in various marketing materials and later, without authorization, on the casino’s website. Although the plaintiff consented to the photograph when it was taken, he complained about its use after he quit his job.

The plaintiff claimed that the casino misappropriated his likeness, and filed an action in Illinois state court, alleging violations of the state’s Right of Publicity Act. The trial court dismissed the action as time-barred, and the plaintiff sought review. The Appellate Court affirmed.

The court began by analyzing when the limitations began to run. Said another way, it looked to determine when the cause of action “accrued.” The photograph was taken in 1994, and about six months later, it appeared on various flyers and brochures, signs and billboards, casino restaurant menus, and calendars and postcards for sale in the casino gift shop. Some time later, the photo appeared on the casino’s website. The plaintiff did not file suit until September 2004.

The court noted that in tort cases, the limitations period begins to run when the plaintiff can first file the lawsuit. Conduct of a defendant falling under the “continuing violation” exception, however, can toll (i.e., delay) the time when the limitations period begins. If there is a continuing violation, the statute of limitations does not begin to run until the tortious acts cease. But the continuing violation exception does not apply if the alleged conduct stems from a “single overt act.” In such cases, the statute begins to run on the date of the single act.

The court declined to apply to continuing violation exception:

We do not believe that the defendants’ act of publishing the plaintiff’s picture in various mediums around the casino falls under the continuing violation exception. Rather, we believe that the use of the plaintiff’s picture in different means such as on the billboard in the casino pavilion, in the casino’s restaurant menu, and on the defendants’ website, constituted a single overt act.

The court cautioned that application of this so-called “first publication rule” is not without its limitations. “[A] republication of the plaintiff’s likeness can constitute a new cause of action if the publication is altered so as to reach a new audience or promote a different product.” Lehman v. Discovery Communications, Inc., 332 F.Supp.2d 534, 539 (E.D.N.Y.2004).

But in this case, even though the casino used the plaintiff’s photograph in different formats over time, it committed only a single overt act for statute of limitations purposes. The uses were all made with the same goal, namely, to attract customers to the casino. Accordingly, a suit filed nearly a decade after the photo was first used was clearly time-barred.

Blair v. Nevada Landing Partnership, — N.E.2d —-, 2006 WL 3594284 (Ill. App. 2 Dist., December 8, 2006)

December 28, 2006 Cybersquatting

Court shuts down unauthorized “e-Certificate” site

Ex parte temporary restraining order issued against operator of northwestdiscountcoupons.com

Northwest Airlines gives away “e-Certificates” to passengers who experience flight delays, cancellations, or other inconveniences. These e-Certificates are redeemable for significant discounts on future ticket purchases. Passengers redeem e-Certificates by visiting Northwest’s website and entering the unique coupon number appearing on the face of each e-Certificate. Until recently, passengers were allowed to give away their e-Certificates to others, but were not permitted to sell them.

In the course of investigating the unauthorized sale of e-Certificates on sites like eBay and Craigslist, a Northwest employee discovered the site northwestdiscountcoupons.com, allegedly operated by one Mike Bauer. To confirm its suspicions, Northwest had one of its interns purchase a number of e-Certificates from the site.

Northwest filed suit against Bauer alleging a number of causes of action, including false advertising, tortious interference, cybersquatting, and trademark infringement. It sought an ex parte temporary restraining order against Bauer. The U.S. District Court for the District of North Dakota granted the motion.

Northwest asserted that two independent causes of action entitled it to injunctive relief. First, it argued that Bauer’s misleading use of the NORTHWEST mark violated the Lanham Act and caused continual and irreparable damage to the value and trust Northwest had cultivated in its name and mark. Second, Northwest argued that Bauer’s alleged illegal and fraudulent sale of e-Certificates to unknown and unsuspecting customers was a violation of public trust that could not be permitted to continue under North Dakota law.

The court went no further than analyzing the alleged violations of the Lanham Act to determine that the temporary retraining order was warranted.

It held that Northwest was likely to succeed on its trademark infringement claim, where, among other things, the defendant was alleged to have registered a domain name that was identical or confusingly similar to Northwest’s distinctive mark. On this point, the court cited to Green Products Co. v. Independence Corn By-Products Co., 992 F.Supp. 1070, 1076-77 (8th Cir.1997) and Faegre & Benson, LLP, v. Purdy, No. Civ. 03-6472 (MJD/JGL), 2004 WL 167570 (Jan. 5, 2004, D.Minn).

Further, citing to Coca-Cola Co. v. Purdy, [No. 02-1782 ADM/JGL, 2005 WL 212797 (Jan. 28, 2005, D.Minn)] the court found that “the nature of the Internet makes if unlikely that consumers can avoid confusion through the exercise of due care.”

Northwest Airlines, Inc. v. Bauer, (Slip Op.) 2006 WL 3733295 (D.N.D., December 15, 2006)

December 22, 2006 Copyright

Enthusiast website owner enjoined from streaming webcasts of racing events

The RIAA and the MPAA aren’t the only ones out there suing their fans for copyright infringement. Live Nation Motor Sports, Inc. (formerly known as SFX Motor Sports) has convinced a federal judge in Texas to enjoin fan-site owner Robert Davis from streaming live webcasts of racing events through his site supercrosslive.com.

It appears that Davis was simply running the live ClearChannel webcast of Supercross racing events through his own website. According to papers filed by the plaintiff, Davis was “transferring” the webcasts to his own website and thereby displaying or performing them in real time. It doesn’t look like there was any copying of the sound recording — instead, Davis was broadcasting or performing the “same audio web cast.”

The court granted the plaintiff’s motion for a preliminary injunction, finding that the plaintiff would likely succeed on its claim that defendant’s actions constituted copyright infringement.

In concluding that the “transfer” of the audio webcast to the supercross.com website was likely an infringement, the court cited to National Football League v. PrimeTime 24 Joint Venture, 211 F.3d 10 (2d Cir.2000) in which the Second Circuit upheld a permanent injunction against a defendant accused of providing unauthorized satellite transmissions of NFL games to viewers in Canada. In that case, the court held that the process of uplinking the NFL’s original signal to a satellite was an unauthorized public performance of the broadcast.

Perhaps the court would have come to a different conclusion on the question of whether the defendant’s “transfer” of the audio webcast was a public performance had it compared it instead to in-line linking. This concept was discussed earlier this year in Perfect 10 v. Google, Inc., 416 F.Supp.2d 828 (C.D. Cal. 2006). In-line linking is the process where a web developer shows an image on his or her website by providing a path in the <img> tag to a file residing on another server.

In the Perfect 10 v. Google case, the court concluded that Google did not itself display or distribute images to which it in-line linked. [More] It applied the “server test” (as opposed to an “incorporation test”) to conclude that “the website on which content is stored and by which it is served directly to a user, not the website that in-line links to it, is the website that ‘displays’ the content.” It found that in aggregating images from other sites, the Google image search engine was not in the process of storing or serving content. “Rather, [users’] computers have engaged in a direct connection with third-party websites, which are themselves responsible for transferring content.”

Live Nation Motor Sports, Inc. v. Davis, (Slip Op.) 2006 WL 3616983 (N.D.Tex., December 11, 2006).

December 19, 2006 Employment

Employer immune under Section 230 in suit over employee conduct

In 2002, an employee of Agilent Technologies named Moore used his computer at work to send a number of e-mail messages and make postings to a Yahoo! group which were threatening in nature. Plaintiffs Delfino and Day were on the receiving end of this rough treatment, and filed suit against Agilent for, among other things, intentional infliction of emotional distress, for allowing Moore to use the system in the manner he had.

At the trial court level, Agilent moved for summary judgment, on grounds that the Communications Decency Act at 47 U.S.C. §230 shielded it from liability. The trial court granted the motion, and plaintiffs sought review. The California Court of Appeal affirmed, holding that §230 immunity barred the action.

To evaluate Agilent’s claim of immunity under §230, the court applied the three elements parsed out of §230(c)(1) in the case of Gentry v. eBay, 99 Cal.App.4th 684 (2002). That test provides that a defendant is immune where (1) it is a provider or user of an interactive computer service, (2) the cause of action treats the defendant as a publisher or speaker of information, and (3) the information at issue is provided by another information content provider.

The court observed that there were no other published decisions in which a corporate employer had been held to be a provider of interactive computer services. But it cited to a couple of law review articles in which commentators had concluded that an employer could meet the §230 provider criterion, and also observed that the evidence on file showed that Agilent’s servers were the means of access to the Internet by thousands of its employees across the country. That commentary and those facts led the court to conclude that the first element in the §230 immunity test had been met.

Next the court considered whether the plaintiffs’ cause of action sought to treat Aglient as a publisher or speaker of information. In addressing this point, the court did not clearly set forth any basis by which the plaintiffs sought to allege that Agilent was the one speaking or publishing the content giving rise to the alleged infliction of emotional distress. Instead, the court looked to the robust history of other cases addressing §230 immunity, noting the varieties of causes of action that had been held barred. Among those causes of action were defamation, nuisance and premises liability, invasion of privacy, misappropriation of right of publicity, and negligent failure to control. With these cases supporting a broad scope of immunity, the court held that the second element in the test for §230 immunity had likewise been met.

Finally, the court easily dispensed with the third element of the test, noting that the record was devoid of any allegations or evidence that anyone other than Moore was responsible for generating the offending content.

[Also covered at IP Law Observer]

Delfino v. Agilent Technologies, Inc., No. 1-03-CV-001573 (Cal. Ct. App. 6th Dist., December 14, 2006)

December 17, 2006 Copyright

Big time blogger faces big time copyright suit

Case promises fair use showdown in blogging context.

[Thanks to Venkat for alerting me to this case.]

The widely-read Los Angeles-based gossip blogger Perez Hilton, whose blog features all sorts of tabloid-like commentary on Hollywood culture, has been sued by X17, a photo agency known for collecting images of celebrities in sometimes not-so-flattering situations. X17 is claiming copyright infringement, and, according to this article from the Boston Herald, the claimed damages are quite substantial (about $7.5 million).

X17 says that Hilton has used its images of celebrities without permission, but Hilton is claiming fair use. And this presents and interesting question. The plaintiff is characterized as a paparazzi agency by this L.A. Times article. It looks like Hilton simply appropriates the images of others, and, using photo editing software, scrawls handwritten messages upon the images. He then posts them with commentary and reports of the celebrities’ goings on.

So will Hilton’s fair use argument get him off the hook? The Copyright Act provides that a defendant’s use of a work is fair if, among other things, the use was made “for purposes such as criticism, comment, [and] news reporting.” Hilton’s lawyer says that the use in this case is fair commentary and a transformation of the original works.

With the dispute framed this way, we’re presented with the question of what are the purpose and character of original paparazzi photos? Are they made for purposes of poking fun and fostering gossip or are they made for some other reason? That “some other reason” seems like it could be elusive. In any event, we’re likely to see X17 make some distinction between serious paparazzi efforts and the efforts of Hilton to make his commentary.

December 14, 2006 Fraud/Misrepresentation

Atkins diet website gets First Amendment protection from negligent misrepresentation claim

In the Spring of 2001, Plaintiff Gorran decided to go on the wildly popular low-carbohydrate Atkins Diet. His cholesterol skyrocketed by almost a hundred points within the first two months, but he stayed on the diet anyway until 2003. After he experienced chest pains, he underwent an angioplasty to unclog an artery.

So Gorran sued Atkins Nutritionals and some other parties, claiming, among other things, that the information on the Atkins website about the diet constituted negligent misrepresentation. The defendants moved for judgment on the pleadings, and the U.S. District Court for the Southern District of New York granted the motion.

The court held that the content on the Atkins website that Gorran complained of could not be the source of any negligent misrepresentation, as it was fully protected by the First Amendment. Gorran had argued that the website functioned “as an electronic store to promote various [D]iet-related food products” and contained, therefore, commercial speech.

The court saw it differently. Indeed the site contained some commercial content (e.g., products for sale). But the content that Gorran alleged was negligent misrepresentations was merely general advice pertaining to the diet. That content was non-commercial. Accordingly, the information was “afforded full First Amendment protection,” and the claim was dismissed.

Gorran v. Atkins Nutritionals, Inc., — F.Supp.2d —-, 2006 WL 3586267 (S.D.N.Y., December 11, 2006).

Interesting Japanese file-sharing case

[Hat tip to Colette for alerting me to this case.]

From Japan, there are reports of a recent decision in a criminal prosecution against the creator of the file-sharing software Winny. From this article we learn that Isamu Kaneko has been ordered to pay 1.5 million yen (almost $13,000 USD) as a fine for creating the software, even though “the court acknowledged that [Kaneko] did not actively encourage copyright infringements over the Internet.”

A holding like this is likely to elicit comparisons between Japan’s framework for secondarily liability and that of the United States, where the law of the land under the Grokster holding calls for liability when one distributes “a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement.”

December 6, 2006 Podcasts

Colette Vogele on Podcast 411

Colette Vogele, a talented San Francisco lawyer and expert on all things legal as they relate to podcasting, was recently interviewed on Podcast 411. [Listen here (about 27 MB)] She covers some interesting topics such as obtaining releases from podcast guests, copyright issues relating to Creative Commons, and some of the intricacies of music licensing.

We also learn from the interview that Colette will soon be launching her own podcast called Rules For the Revolution. I’m looking forward to that.

November 27, 2006 First Amendment

Seventh Circuit: explicit video game law unconstitutional

Ban of sale to minors and labeling requirements not narrowly tailored to meet compelling state interest.

In August 2005, the Illinois State Legislature enacted the Sexually Explicit Video Game Law (“SEVGL”), which criminalized the sale of “sexually explicit” video games to minors, and required purveyors of such games to conspicuously label any sexually explicit game with a four square inch label reading “18”, and provide relevant signage within the stores where games are sold.

The Entertainment Software Association, among others, filed suit against the State of Illinois the day after the SEVGL was enacted, claiming that the law violated the First Amendment. The district court permanently enjoined enforcement of the law, and the State of Illinois sought review. On appeal, the Seventh Circuit affirmed the lower court’s holding that the statue was not narrowly tailored.

An integral part of the court’s analysis was its concern that the statute would criminalize the sale of material “without concern for the game considered in its entirety or for the game’s social value for minors.” As a case in point, the court looked to the game God of War, which tracks the Homeric epic Odyssey in content and theme. Although that game shows exposed breasts, the court held that “there is serious reason to believe that a statute sweeps too broadly when it prohibits a game that is essentially an interactive, digital version of the Odyssey.”

As for the unconsitutionality of the labeling and signage requirement, the court similarly held that such a requirement was not narrowly tailored. The government had not shown that an educational campaign about the video game rating system would not have been just as effective as labeling. The requirement of a sticker that covers a substantial portion of the box was also unjustified.

Entertainment Software Association v. Blagojevich, No. 06-1012, — F.3d —-, (7th Cir., November 27, 2006).

November 27, 2006 Contracts

Terms of e-commerce agreement not part of previous franchise agreement

Arbitration provision in later agreement not applicable to previous agreement, where contracts independent, collateral, and not inconsistent with one another.

Defendant AMF, the well-known manufacturer of bowling and billiards equipment, entered into an oral franchise agreement with plaintiff Suburban Leisure Center, whereby Suburban would sell AMF’s products in the St. Louis area. Later, the parties entered into a written “e-commerce” agreement, whereby Suburban agreed to service products in its geographic area that were sold through AMF’s website.

After AMF sought to terminate the oral franchise agreement, Suburban filed suit, claiming, among other things, that AMF had not provided the proper notice of termination under Missouri law. AMF moved to dismiss Suburban’s claim, arguing that under the terms of the e-commerce agreement, the exclusive method of dispute resolution between the parties was through arbitration. The district court denied the motion to dismiss, and AMF sought review. On appeal, the Eighth Circuit affirmed.

AMF had argued that the e-commerce agreement (which contained the arbitration provision) fully set forth the terms of the contract. AMF pointed to a “merger clause” (also known as an “integration clause” or “entire agreement” clause) in the agreement. Because of this clause, AMF contended, the parol evidence rule prohibited considering the terms of the oral franchise agreement, which contained no mention of arbitration.

The court disagreed, however. Applying Virginia law as required by the choice of law provision in the e-commerce agreement, the court examined the “collateral contract doctrine.” It noted that the oral franchise agreement addressed a contractual relationship between the parties that was not covered in any manner by the e-commerce agreement. As a result, the oral franchise agreement was “independent of, collateral to, and not inconsistent with” the e-commerce agreement. Examination of parol evidence, namely, the terms of the oral agreement, was therefore proper.

Because the agreements were independent of each other, the e-commerce agreement’s arbitration language could not be attributed to the oral franchise agreement. After all, the dispute was over the termination of the franchise, not the agreement to service products that had been sold through AMF’s website. The oral franchise agreement did not provide for arbitration. Because a “party cannot be required to submit to arbitration any dispute which he has not agreed so to submit,” the matter was properly before the court, and the lower court’s denial of the motion to dismiss was proper.

Suburban Leisure Center, Inc. v. AMF Bowling Products, Inc., — F.3d —-, No. 06-1865, 2006 WL 3332965 (8th Cir., November 17, 2006).