IP Law Chat

Jury Awards $28.1 Million to Retired NFL Players

sl@hllaw.com (Stacia Lay) — Thu, 13 Nov 2008 11:13:17 -0800

On November 10, 2008, a jury awarded a $28.1 million verdict ($7.1 million in damages and $21 million in punitive damages) against the National Football League Players Association and Players Inc. in a class action suit brought by retired NFL players.

In the suit, retired football players (including the named-plaintiffs Bernard Paul Parrish, Herbert Anthony Adderley and Walter Roberts, III) alleged various claims against the NFLPA in connection with "Group Licensing Agreements" or "Group Licensing Authorizations" ("GLAs"). Pursuant to these GLAs, the NFLPA obtained the (allegedly) non-exclusive right to market retired players' names, numbers, likenesses, voices, facsimile signatures, photographs, and biographical information with respect to licensed products such as trading cards, video games, and personal appearances and events. The money generated by such licensing was to be "divided between the player and an escrow account for all eligible NFLPA members who have signed a group licensing authorization form."

But the plaintiffs alleged that the NFLPA failed to comply with this revenue-sharing obligation and thereby violated the GLAs as well as fiduciary obligations owed to the retired football players. You can read a copy of the (heavily-redacted) Third Amended Complaint, without exhibits, here.

The jury found for the retired football players on both claims but only awarded damages ($7.1 million) on the breach of fiduciary claim plus the $21 million in punitive damages.

The case cite is Adderley, et al. v. National Football League Players Association, et al., No. C 07-00943 WHA (N.D. Cal.).

Ninth Circuit Upholds First Amendment Defense to Strip Club's Trademark Claims

sl@hllaw.com (Stacia Lay) — Fri, 07 Nov 2008 11:38:04 -0800

In E.S.S. Entertainment 2000, Inc. v. Rock Star Videos, Inc., the Ninth Circuit addressed the question of whether the producer of the video game "Grand Theft Auto: San Andreas" had a defense under the First Amendment to the claim of trademark infringement brought by the operator of a strip club in downtown Los Angeles called the Play Pen Gentlemen's Club.

In "Grand Theft Auto: San Andreas," the game depicts, in the words of the Ninth Circuit, "one or more dystopic, cartoonish cities" modeled after American urban areas including, as relevant to this case, Los Angeles. The game's version of Los Angeles, called "Los Santos," depicts various businesses such as liquor stores, ammunition dealers, bars and strip clubs, which were inspired, at least in part, from photographs of actual businesses in Los Angeles, including the Play Pen. The strip club in the game, however, was named the "Pig Pen" and lacked some of the characteristics of the Play Pen building.

Nonetheless, the operator of the Play Pen sued the producer of the game for trade dress infringement, unfair competition and trademark infringement under the Lanham Act and unfair competition under California state law claiming that the game "used Play Pen's distinctive logo and trade dress without its authorization and has created a likelihood of confusion among consumers as to whether [the plaintiff] has endorsed, or is associated with, the video depiction."

The producer of the game moved for summary judgment arguing the affirmative defenses of nominative fair use and the First Amendment. The District Court (Judge Margaret M. Morrow, who wrote a very thorough 55-page opinion containing a wealth of authority) rejected the nominative fair use defense but granted summary judgment to the game producer based on the First Amendment defense.

The Ninth Circuit agreed with the District Court, concluding that because the game's "Pig Pen" strip club did not use the actual trademarked Play Pen logo, the nominative fair use defense did not apply.

Applying the Second Circuit's test from Rogers v. Grimaldi, the Ninth Circuit also upheld the defendants' First Amendment defense to the strip club's trademark claims. Although traditionally, the test had been applied to uses of a trademark in the title of an artistic work (such as the song "Barbie Girl" in the Mattel, Inc. v. MCA Records, Inc. case), the Ninth Circuit concluded that it should also apply to the use of a mark in the body of the work, such as the "Pig Pen" strip club in the video game. Other than this clarification, the Ninth Circuit's application of the Rogers test was straightforward: the use of the mark had some artistic relevance to the work ("some" meaning the level of relevance must merely be more than zero); and the use of the mark did not explicitly mislead as to the source or content of the work. As to the latter point, the Ninth Circuit described its conclusion in creative fashion:

Both San Andreas and the Play Pen offer a form of low-brow entertainment; besides this general similarity, they have nothing in common. The San Andreas Game is not complementary to the Play Pen; video games and strip clubs do not go together like a horse and carriage or, perish the thought, love and marriage.

You can read the Ninth Circuit's opinion here (PDF, 11 pages).

NIKE Sues Wal-Mart for Patent Infringement

sl@hllaw.com (Stacia Lay) — Thu, 16 Oct 2008 10:41:17 -0800

NIKE has sued Wal-Mart in the Northern District of Illinois claiming that Wal-Mart infringed NIKE's design patents in its "NIKE SHOX" shoes. You can find a copy of the complaint, filed Monday, including pictures of the shoes sold by Wal-Mart, here (PDF,17 pages).

California Court Rejects Trial Court's Gag Order on Newspaper's Reporting of Trial Testimony

sl@hllaw.com (Stacia Lay) — Tue, 30 Sep 2008 12:06:09 -0800

In a strongly-worded opinion, a California appellate court directed the trial court to vacate an order--issued sua sponte--enjoining a newspaper, The Orange County Register, from reporting on the trial testimony of any witness in a wage-and-hour class action in which the newspaper was a defendant. Characterizing the order as "censorship", the appellate court readily concluded that the danger sought to be averted by the gag order--the risk that witnesses might be influenced by reading news reports of the testimony of other witnesses--could not possibly justify such a prior restraint.

You can find a copy of the court's opinion in Freedom Communications, Inc. v. Superior Court of Orange County here (PDF, 5 pages).

False Endorsement and "the Voice of God"

sl@hllaw.com (Stacia Lay) — Thu, 11 Sep 2008 15:54:35 -0800

John Facenda won national acclaim for his work on various NFL Films becoming known to some football fans as "the Voice of God" because of the special qualities of his voice. For decades, Mr. Facenda did worked on these films under an oral agreement, receiving a per-program fee. But not long before he died of cancer in 1984, Mr. Facenda signed a standard release contract that stated that NFL Films enjoys "the unequivocal rights to use the audio and visual film sequences recorded of me, or any part of them . . . in perpetuity and by whatever media or manner NFL Films . . . sees fit, provided, however, such use does not constitute an endorsement of any product or service."

In 2005, NFL Films produced "The Making of Madden NFL 06," a 22-minute long production that was shown on the NFL Network eight times in a three-day span leading up to the release of the video game. The program included three sentences read by Mr. Facenda that were taken from earlier NFL Films' productions (although they were apparently digitally altered to make them sound more like the synthesized speech from a computer) that totaled 13 seconds of the program.

Mr. Facenda's estate sued the NFL for false endorsement under Section 43(a) of the Lanham Act and for unauthorized use of name or likeness under Pennsylvania state law. Specifically, as to the former claim, the Estate alleged that the use of the sound recordings of Mr. Facenda's voice falsely implied that the Estate had agreed to endorse the video game. The case was split into liability and damages phases and, upon cross-motions for summary judgment on liability, the District Court granted summary judgment to the Estate on both claims.

In a 60-page opinion, the Third Circuit reversed the grant of summary judgment on the Lanham Act false endorsement claim and remanded for trial but affirmed the grant of summary judgment to the Estate on the state law right of publicity claim.

As to the Lanham Act claim, the Third Circuit first rejected the NFL's First Amendment defense, concluding that the production was commercial speech and therefore declining to reach the issue of whether the Court would adopt the Rogers balancing test that weighs the public interest in avoiding consumer confusion against the public interest in free expression (in other words, it addresses the collision of the Lanham Act with the First Amendment).

Turning to the substance of the Lanham Act claim, the only prong at issue was the "likely to cause confusion" prong as the NFL did not contest that Mr. Facenda's voice could be protected as an unregistered mark and that the Estate owned the "mark."

The Third Circuit, however, was exploring new territory as it had yet to announce the legal standard applying to false endorsement claims under Section 43(a). The District Court had used the traditional 10-factor test from Section 43(a)(1)(A) cases as modified for false endorsement cases used by the Ninth Circuit. With some modifications, the Third Circuit agreed with the District Court's use of these modified factors in false endorsement cases. The Third Circuit also rejected the NFL's contention that claims under Section 43(a)(1)(A) required proof of actual confusion distinguishing between claims brought under that section versus those brought under Section 43(a)(1)(B) for false advertising. Ultimately, the Third Circuit concluded that there were issues of fact (such as whether the NFL intended to profit unjustly from the use of Mr. Facenda's voice in the program) that precluded summary judgment.

As to the state law right of publicity claim, the Third Circuit readily agreed with the District Court's grant of summary judgment to the Estate. The Court then turned to what appears to have been the NFL's primary argument, namely, that copyright law preempts the Estate's right of publicity claim.

The Third Circuit found no express preemption under Section 301(a) of the Copyright Act, in part because Pennsylvania's right of publicity statute required an additional element beyond what is required for a copyright infringement claim, specifically, that Mr. Facenda's voice have "commercial value."

The Court then went on to discuss--at some length--whether the right of publicity claim was impliedly preempted by copyright law because it clashed with the NFL's right to exploit its copyright. As with the NFL's First Amendment argument, the commercial nature of the program was its downfall. Relying on the premise that rights of publicity claims involving use of the work "for the purposes of trade" such as in an advertisement should not be preempted (as compared to claims involving expressive works), the Third Circuit concluded that the nature of the NFL program (which it characterized as a promotional piece) suggested that implied preemption was inappropriate.

The Third Circuit next turned to the release Mr. Facenda signed concluding that it did not support a finding of preemption. The question in cases involving a contract and advertising was whether the plaintiff collaborated in the creation of a copyrighted advertising product. If the plaintiff did, allowing the plaintiff to assert a right of publicity claim for use of its likeness in advertising would conflict with the copyright holder's rights. But such was not the case here, the Third Circuit concluded. To the contrary, Mr. Facenda participated in creating films documenting NFL games (presumably expressive works), not an advertisement for a football video game and the release he signed specifically preserved his right of publicity with respect to endorsements. Thus, no implied preemption and summary judgment on this claim was affirmed.

Garlic and the First Amendment

sl@hllaw.com (Stacia Lay) — Tue, 09 Sep 2008 15:49:17 -0800

In July 2000, George Villegas and several other plaintiffs, all of whom are members of the Top Hatters Motorcycle Club, attempted to attend the Gilroy Garlic Festival wearing vests that included an image of a skull with wings and a top hat with "Top Hatters" written above the hat and "Hollister" written below. Pursuant to an unwritten dress code of the Gilroy Garlic Festival Association, a private non-profit corporation, prohibiting "gang colors or other demonstrative insignia, including motorcycle club insignia, an on-duty Gilroy police officer was asked by the festival's chair of security (an off-duty Gilroy police officer) to remove the Top Hatters from the festival.

The Top Hatters then sued the City of Gilroy, the Gilroy Garlic Festival Association and the individual police officer under Section 1983 for violation of their civil rights. The District Court granted summary judgment in favor of the City and the Festival Association, concluding that wearing the Top Hatters vests was neither expressive conduct nor expressive association protected under the First Amendment and that the Festival Association was not a state actor. A three-judge panel of the Ninth Circuit affirmed, concluding that wearing the Top Hatters vests was subject to expressive conduct analysis but found no First Amendment violation. The panel did not reach the state action issue.

The Ninth Circuit then ordered the case to be heard en banc.

This time around, the Ninth Circuit again affirmed the grant of summary judgment but did so on the ground that the Festival Association was not a state actor and that "[b]ecause there is no constitutional violation, there can be no municipal liability." Unfortunately, the Ninth Circuit did not reach the question of whether wearing the Top Hatters vests and insignia constituted expressive conduct (and the three-judge panel's decision addressing that issue was withdrawn and designated non-precedential and non-citable).

You can find the Ninth Circuit's opinion, including two dissents, here.

Copyright Owners Must Consider Fair Use in Connection With DMCA Notices

sl@hllaw.com (Stacia Lay) — Thu, 21 Aug 2008 11:56:22 -0800

In February 2007, Stephanie Lenz videotaped her young children dancing in the family's kitchen while a song, "Let's Go Crazy" by Prince, played in the background. Lenz uploaded the 29 second video to YouTube. (Although the song purportedly can be heard for about 20 seconds of the video, I have to admit that I could hear very little of it because of the admittedly "poor sound quality" and the sounds the children were making as they pushed toys around the family's kitchen.)

Universal then sent a takedown notice pursuant to Section 512 of the DMCA to YouTube, which stated in part that Universal had a "good faith belief" that the video "is not authorized by the copyright owner, its agent, or the law." In response, YouTube took down the video although it was re-posted approximately six weeks later after Lenz sent a DMCA counter-notification.

Lenz then sued Universal for several claims, two of which were dismissed upon Universal's first motion to dismiss. Lenz then filed an amended complaint that asserted a single claim under Section 512(f) of the DMCA that Universal "knowingly materially misrepresent[ed]" that the home video of her dancing children infringed Universal's copyright in the Prince composition. Specifically, Lenz asserted that her use of the song was a "self-evident non-infringing fair use" under the Copyright Act and that Universal's DMCA notice stating to the contrary was an actionable misrepresentation under Section 512(f) of the DMCA.

Although Universal claimed that "it [was] time for this case to be over," the Court apparently did not agree and denied Universal's motion to dismiss the amended complaint.

Essentially, Universal argued that (1) it did not send a DMCA notice because, although it was sent to the email address dedicated to such notices and contained all the necessary elements of a DMCA notice, Universal apparently "does not agree that YouTube is eligible for protection under the DMCA's 'safe harbors,'"; (2) there was no knowing misrepresentation because fair use is an affirmative defense to otherwise infringing conduct; (3) fair use is never "self-evident" because of its "fact-specific, equitable nature"; and (4) as a fact-specific matter, Lenz's use was not "self-evidently" a fair use. (As a side-note, it seems problematic for Universal to be claiming that it can and does make legal and factual conclusions about whether YouTube is "eligible for protection under the DMCA's 'safe harbors'" but cannot be expected to consider the fair use doctrine.)

Stating as a fact that Universal did send a DMCA notice to YouTube, the Court characterized the issue before it as follows: "whether 17 U.S.C. [Section] 512(c)(3)(A)(v) requires a copyright owner to consider the fair use doctrine in formulating a good faith belief that 'use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law.'" Noting that the Copyright Act expressly provides that "fair use of a copyrighted work . . . is not an infringement of copyright," the Court concluded that the copyright owner must consider the fair use doctrine in evaluating its "good faith belief that use of the material in the manner complained of is not authorized by . . . the law." Thus, the Court concluded that an allegation that the copyright owner acted in bad faith by issuing a takedown notice without consideration of the fair use doctrine is sufficient to state a misrepresentation claim under Section 512(f) of the DMCA.

You can find the Court's opinion here (PDF, 10 pages), and for an interesting read, the parties' lengthy briefing on the motion here (PDF, 24 pages), here (PDF, 28 pages) and here (PDF, 18 pages).

First Circuit finds "duck tours" generic for, well, duck tours

sl@hllaw.com (Stacia Lay) — Thu, 14 Aug 2008 16:34:21 -0800

In a remarkably lengthy decision, the First Circuit reversed the grant of a preliminary injunction in a trademark case concluding that the phrase "duck tour" was generic for the parties' services and that the District Court's conclusion to the contrary was clear error.

The case pitted the plaintiff--Boston Duck Tours--against its competitor Super Duck Tours. On Boston Duck Tours' motion for a preliminary injunction, the District Court concluded that the phrase "duck tours" was non-generic based entirely on a dictionary definition of "duck" that did not include any reference to DUKWs (amphibious army vehicles used in World War II) or amphibious vehicles. The District Court thus enjoined Super Duck Tours from using the phrase "duck tours" or a cartoon duck (both parties used a cartoon duck in water as part of their design marks) as a trademark in connection with its tour service in the greater Boston area.

The First Circuit reversed the grant of a preliminary injunction based largely on its conclusion that the District Court erred in finding the phrase "duck tours" to be non-generic. In reaching this conclusion, the First Circuit looked to evidence overlooked by the District Court, including third-party sources that used the phrase "duck tours" generically to refer to amphibious sightseeing tours and Boston Duck Tours' own generic use of the phrase "duck tour." The First Circuit also considered the widespread use of "duck" and "duck tours" by companies around the country that provide the same amphibious sight-seeing services (32 of the 36 tours described in the record used the term "duck" and more than 10 used both "duck" and "tour(s)").

You can find the First Circuit's opinion, including concurring opinion, here (PDF, 74 pages).

Fantasy Baseball, Publicity Rights and the First Amendment

sl@hllaw.com (Stacia Lay) — Tue, 12 Aug 2008 13:14:35 -0800

[Editor's Note: Following is a guest post by Katherine Hendricks, a partner at Hendricks & Lewis.]

With the Supreme Court's denial of the petition for a writ of certiorari in June 2008, the Eighth Circuit's opinion in perhaps the most-watched right of publicity case in 2007 in C.B.C. Distribution & Marketing, Inc. v. Major League Baseball Advanced Media, L.P., will stand.

Fantasy sports operator, C.B.C. Distribution and Marketing, Inc. ("C.B.C."), brought a declaratory judgment action against the Internet arm of Major League Baseball, Major League Baseball Advanced Media, L.P. ("Advanced Media") to establish C.B.C.'s right to use--without license--major league baseball players' names and performance statistics in fantasy baseball.

In fantasy baseball, participants form fantasy teams by "drafting" players from major league teams before the season begins each spring. Participants compete against other fantasy baseball "owners" who have put together their own teams. Participants' success and that of their fantasy teams depend on the performance of the individual players on their actual teams during the major league season. Participants pay fees to play and additional fees to trade players during the season. (According to the Fantasy Sports Trade Association, the fantasy sports business is a $1.5 billion industry with 19.4 million players in the United States and Canada. Bob Van Voris and Jeff St. Onge, Fantasy Sports Win Right to Player Names, Statistics (Update 5), bloomberg.com, October 16, 2007.)

From July 1995 through December 2004, C.B.C. had a license from the Major League Baseball Players Association ("MLBPA") to use the names, nicknames, likenesses, signatures, pictures, playing records and biographical data of each player as well as the logo, name and symbol of the MLBPA. The license expired and was not successfully renegotiated with Advanced Media, the entity that had acquired all of the players' rights. Fearful that Advanced Media would sue C.B.C. for continuing to operate its fantasy sports games without a license, C.B.C. sought declaratory relief in the Eastern District of Missouri.

The district court granted summary judgment to C.B.C., holding that it was not infringing any state-law rights of publicity but that even if publicity rights were implicated, the First Amendment trumped those rights. The district court also addressed the question whether the players' rights of publicity claims would be preempted by copyright law, finding that the players' records were mere facts which did not involve the sine qua non of copyright: originality. Because the players' names and playing records were not copyrightable, copyright preemption did not apply.

The Eighth Circuit concluded that the identities of major league players were being used for commercial advantage without their consent and thus, that they made out a cause of action for violation of their rights of publicity. Nonetheless, these rights were outweighed by the First Amendment. Because the court held that C.B.C.'s First Amendment rights in offering fantasy baseball products superseded players' rights of publicity, it did not reach the copyright preemption issue.

Weighing rights of publicity against First Amendment considerations is nothing new. See, e.g., Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562 (1977). Usually, courts conduct a fact-specific balancing test that compares the competing interest of the person's right of publicity with the public's right to be informed. The outcome typically depends upon where the use falls on the continuum ranging form "news" (e.g., current events and political commentary) and "public interest" (e.g., fiction or satire), to "commercial speech" (like advertising). See, e.g., Cardtoons, L.C. v. Major League Baseball Players Ass'n, 95 F.3d 959 (10th Cir. 1996) (a set of collectible trading cards with parody cartoons of major league baseball players accompanied by humorous text); Elvis Presley Enterprises, Inc. v. Capece, 950 F. Supp. 783 (S.D. Tex. 1996) (use of the trade name "The Velvet Elvis" by a nightclub, and its selling of frozen drinks called "Love Me Blenders" and a food item named "Your Football Hound Dog"); New Kids On The Block v. News America Pub. Inc., 745 F. Supp. 1540 (C.D. Cal. 1990), aff'd, 971 F.2d 302 (9th Cir. 1992) (the use by a newspaper and magazine of the "New Kids On The Block" trademark in connection with a "900-number" phone service to conduct polls regarding readers' favorite and "sexiest" members of the musical group).

The Eighth Circuit concluded that C.B.C.'s fantasy sports use falls within the "public interest" portion of that continuum. Because baseball is "the national pastime" and the public has an "enduring fascination" with baseball's records and statistics, that data is due "substantial constitutional protection." But perhaps more importantly, the information in question is "readily available in the public domain, and it would be strange law that a person would not have a first amendment right to use information that is available to everyone."

Although the court agreed the players' "identities are being used for commercial advantage," it concluded that the interests fulfilled by a right of publicity (namely, the right of an individual to reap the rewards of his or her endeavors and to earn a living) are "barely" implicated because major league baseball players are already "handsomely" rewarded and also have the opportunity to earn additional large sums from endorsements and sponsorships.

While one might initially and reasonably conclude that publicity rights are outweighed by the First Amendment, the rationale that rights of publicity are "barely" implicated if the holders of those rights already make lots of money is of little use as a general principle within the context of adjudicating publicity rights because those rights are generally most important to celebrities with real star power who more often than not find themselves "handsomely rewarded" for their endeavors. It might have been preferable to conclude that the public's constitutional free speech interest in using publicly-available facts outweighs any player's individual monetary interest.

Summary Judgment Granted to Talk-Radio Host in Abu Ghraib Defamation Case

sl@hllaw.com (Stacia Lay) — Fri, 08 Aug 2008 14:14:57 -0800

In 2005, CACI Premier Technology, Inc. and CACI International Inc. ("CACI")--a U.S. government contractor that provides intelligence services to the military and which, beginning in 2003, provided civilian interrogators for the U.S. Army's military intelligence brigade at the Abu Ghraib prison--sued talk-radio host Randi Rhodes and others for defamation for statements Rhodes made on The Randi Rhodes Show. Specifically, CACI claimed that Rhodes accused it of, among other things, torture, rape and murder at the Abu Ghraib prison.

The district court granted summary judgment to the defendants, finding that each of Rhodes's statements were not demonstrably false, were non-actionable hyperbole or were not made with actual malice, the applicable standard in the case as it was undisputed that CACI was a public figure. In a lengthy decision addressing each of the challenged statements in some detail, the Fourth Circuit agreed and affirmed the grant of summary judgment. You can find the Fourth Circuit's opinion in CACI Premier Tech., Inc. v. Rhodes, here (WARNING: the opinion contains descriptions of some of the detainee abuse at Abu Ghraib).

Copyright Infringement in the Virtual World -- Update

sl@hllaw.com (Stacia Lay) — Thu, 07 Aug 2008 15:52:11 -0800

UPDATE: And since I'm on the subject of updates, in another "virtual world" case, a consent judgment recently was entered in the case of Eros, LLC v. Leatherwood, in which the plaintiff claimed that the defendant violated the Lanham Act and committed copyright infringement within the virtual world Second Life. A copy of the Consent Judgment can be found here (PDF, 2 pages) and my earlier discussion of the case, including a copy of the plaintiff's complaint, here.

WoW "Gold Farming" Class Action Update

sl@hllaw.com (Stacia Lay) — Thu, 07 Aug 2008 15:14:52 -0800

UPDATE: Although I would've liked to see more of this case (just so I could work in "For the Horde" in a blog entry but somehow I just did), it appears there has been a settlement in the case filed by a player of Blizzard's World of Warcraft against so-called "gold farmers," who generate ("farm") virtual gold in-game to sell to players for "real world" money. It looks like the case is not over yet though as the plaintiff moved for leave to file a motion to enforce the settlement under seal (which was only granted in part, see the Court's order here PDF, 4 pages). As a side note, even though the motion to file under seal was unopposed, it was comforting to have the Court seriously consider the public's interest in having access to judicial records and to limit the parties' right to file documents under seal.

For my earlier discussion of the case (Hernandez v. IGE U.S. LLC, Case No. 07-21403-CIV-COHN (S.D. Fla.)) and the amended complaint filed in the case, see here.

Class Action Complaint Filed Over Virtual World "Gold Farming"

sl@hllaw.com (Stacia Lay) — Tue, 08 Apr 2008 14:56:42 -0800

Being a bit of a WoW aficionado, I can't pass up a story where the virtual and legal worlds collide. Marty Schwimmer at The Trademark Blog has just such a story with the news that a player of Blizzard Entertainment's enormously-successful MMORPG (massively multiplayer online role-playing game) World of Warcraft, has filed a class action complaint in federal court in Florida against alleged so-called "gold farmers," who generate virtual gold and sell it to players for "real life" money.

The plaintiff has asserted, among other claims, causes of action for breach of third party beneficiary contract (the End User License Agreement and Terms of Use Agreement), violation of the Computer Fraud and Abuse Act, violation of state consumer protection acts and conspiracy.

You can find the amended complaint here (PDF, 48 pages) and answer here (PDF, 19 pages).

Teacher's Blog Entries Do Not Meet "Public Concern" Test

sl@hllaw.com (Stacia Lay) — Mon, 07 Apr 2008 10:39:30 -0800

In May 2007, Tara Richerson was transferred to a new position with the Kitsap County School District that included responsibilities with a new instructional coaching model where she would work with teachers to enhance their professional development. The coach's role was to be a mentor and develop a "trusting" and "confidential" relationship with the classroom teachers.

Ms. Richerson also maintained a blog in which she recounted her observations as an employee of the school district. In one entry, she commented as follows on the person hired to replace her when she was assigned to her new position:

Save us White Boy!
I met with the new me today: the person who will take my summer work and make it a full-time year-round position. I was on the interview committee for this job and this guy was my third choice . . . and a reluctant one at that. I truly hope that I have to eat my words about this guy. . . . But after spending time with this guy today, I think Boss Lady 2.0 made the wrong call in hiring him. . . He comes across as a smug know-it-all creep. And that's probably the nicest way I can describe him. ... He has a reputation of cra**ing on secretaries and not being able to finish tasks on his own. ... And he's white. And male. I know he can't help that, but I think the District would have done well to recruit someone who has other connections to the community. ... Mighty White Boy looks like he's going to crash and burn.

When the school district learned of the blog entry, Ms. Richerson was verbally reprimanded for violating the confidentiality required of a member of an employee interview team and a confirming letter was placed in her personnel file.

At some point, the school district also received a complaint from a district teacher and lead union negotiator about another entry on Ms. Richerson's blog, which the teacher construed as a personal attack on her. The entry apparently included the statement, "What I wouldn't give to draw a little Hitler mustache on the chief negotiator." The school district then advised Ms. Richerson that she was being involuntarily reassigned from her new position to that of a classroom teacher.

Ms. Richerson then brought suit in the Western District of Washington claiming that the school district had violated her civil rights by reassigning her in retaliation for the exercise of her First Amendment free speech rights.

On cross-motions for summary judgment, the District Court disagreed, concluding that Ms. Richerson's speech did not meet the "public concern" test and was therefore not protected. The District Court noted that the government has a "freer hand" in regulating the speech of its employees and concluded that the proposed mentoring relationship between Ms. Richerson and other teachers envisioned in her new position would have faced "severe difficulties" had she not been reassigned following her blog entries. In concluding that Ms. Richerson's speech on her blog did not meet the public concern test, the District Court also noted that "it was racist, sexist, and bordered on vulgar" and characterized her behavior, in part, as "salacious" and "mean spirited."

You can read the District Court's full opinion here and the complaint and answer here and here.

CDA Immunity Decision from the Ninth Circuit

sl@hllaw.com (Stacia Lay) — Fri, 04 Apr 2008 18:15:56 -0800

UPDATE:

On Thursday, the Ninth Circuit issued its en banc opinion in the case, again written by Judge Kozinski, which affirmed that Roommates.com, LLC enjoys some limited immunity for the content on its website under Section 230 of the CDA.

There's plenty of discussion of the opinion to keep you busy. Following are links to a few:

Technology & Marketing Law Blog
Internet Cases
Decision of the Day
The Volokh Conspiracy

And feel free to click through to see the original posting on the case.

In a rather fractured opinion, the Ninth Circuit denied immunity under the Communications Decency Act, 47 U.S.C. § 230(c), to Roommates.com, LLC, concluding that, at least in regard to some of the website content, Roommates.com was an "information content provider" and therefore may be subject to liability for publishing materials on the website.

The case, Fair Housing Council of San Fernando Valley, et al. v. Roommates.com, LLC, began when two housing councils sued Roommates.com for allegedly violating the Fair Housing Act and various state laws. The District Court found that the housing councils' Fair Housing Act claim was barred by the CDA but the Ninth Circuit disagreed, at least in part, in a lead opinion written by Judge Alex Kozinski.

The Ninth Circuit characterized the question before it as whether Roommates.com was "responsible, in whole or in part, for creating or developing the information" on the website, in which case it would become a "content provider" and would not be entitled to CDA immunity. The Court apparently had no problem concluding that Roommates.com was a content provider in connection with the questionnaires it asked users to complete because it created or developed the forms and answer choices.

The Court then turned to "the more difficult question" of whether Roommates.com was also a content provider subject to liability "for publishing and distributing its members' profiles, which it generates from their answers to the form questionnaires." Given this characterization of the question, it is probably not surprising that the Court concluded that Roommates.com was also a content provider in this context because it "categoriz[ed], channel[ed] and limit[ed] the distribution of user's profiles," thereby providing "an additional layer of information that it is 'responsible' at least 'in part' for creating or developing."

Finally, the Court concluded that Roommates.com was entitled to CDA immunity for publishing the content provided by its members in the "Additional Comments" portion of the profiles because that portion posed only an "open-ended question" that suggested "no particular information that is to be provided by members." In a separate opinion, Judge Reinhardt dissented from this portion of Judge Kozinski's opinion, arguing that Roommates.com was not entitled to CDA immunity for publishing this content. Judge Reinhardt expressed a fairly unfavorable opinion of the "Additional Comments" portion of the website, stating that from "a subjective perspective, Roommate's site is designed so that users will express illicit preferences in their 'Additional Comments.'"

Judge Ikuta also weighed in with a separate opinion expressing disagreement with one portion of the Court's lead opinion specifically as it related to binding Ninth Circuit precedent which she stated resulted in "robust immunity under section 230(c)."

With three opinions, the case offers a lot to mull over. For more commentary on and analysis of the Ninth Circuit's opinion, see Decision of the Day, The Volokh Conspiracy and the Technology & Marketing Law Blog.

Worlds collide -- The Doors and insurance

sl@hllaw.com (Stacia Lay) — Wed, 26 Mar 2008 15:27:19 -0800

When is an opinion about insurance coverage interesting? Answer: When it involves The Doors.

Lincoln and Copyrights -- The Real History

sl@hllaw.com (Stacia Lay) — Thu, 13 Mar 2008 13:38:35 -0800

William Patry at The Patry Copyright Blog sets the record straight on the history of copyright at the time of Lincoln. The history buff in me says kudos for the fascinating history lesson.

Publication of SSN on Court Website Does Not Violate Right of Privacy

sl@hllaw.com (Stacia Lay) — Wed, 27 Feb 2008 17:54:54 -0800

In 2003, Cynthia Lambert had the misfortune of getting a speeding citation. To her further misfortune, she later learned that the traffic citation--which included personal identifying information such as her driver's license number and Social Security number--had been published on the County Clerk of Courts' public website. Lambert learned this fact after she was contacted by two stores who reported suspicious purchases made in her name by a person who used a driver's license that displayed her name, home address, birth date, driver's license number and Social Security number. The stores suggested that the identity thief may have obtained Lambert's personal information from the County Clerk's website. Indeed, when Lambert examined the citation on the website, she discovered that it, like the fake ID used by the identity thief, contained a driver's license number that was wrong by one digit. Lambert--not unreasonably--asked that the information be removed from the website but the County Clerk's office refused, stating that removing the records "would require vast amounts of manpower."

So, Lambert filed suit, claiming, in part, that the publication of the citation violated her constitutional right to privacy under the Fourteenth Amendment. Notably, by the time she filed suit, the police had apprehended a group of individuals who had used the personal information from the County Clerk's website to commit identity theft, including a woman who admitted that she had stolen Lambert's identity from the website.

Unfortunately for Lambert though, the District Court concluded that she had failed to state a claim because her claimed privacy interest was not "of a constitutional dimension." While obviously sympathetic to Lambert's situation, the Sixth Circuit agreed with the District Court, concluding that she had not shown an infringement of a right that is "fundamental or implicit in the concept of ordered liberty," as required by Sixth Circuit precedent.

But the news wasn't all bad. According to the Sixth Circuit (which characterized the decision to provide unfettered internet access to Social Security numbers "unwise"), the County Clerk "removed the citations in question" from the website and changed the local rules to protect sensitive personal information.

You can read the full opinion here.

A Story About Coincidence

sl@hllaw.com (Stacia Lay) — Thu, 14 Feb 2008 14:31:05 -0800

Many times, I find cases more interesting for the stories they tell than the thorny legal issues they may (or may not) present. American Express Co. v. Goetz out of the Second Circuit is one of those cases and it tells a story of remarkable coincidence.

In the summer of 2004, the defendant, Stephen Goetz developed the idea of allowing credit card customers to personalize their cards by choosing a photo to be printed on the card. As part of his pitch for this idea, Goetz used the slogan "My Life, My Card" because he thought the phrase "would perfectly embody what card consumers sought." On July 30, 2004, Goetz mailed a proposal to American Express that included the slogan. He also created an Internet-based demonstration of his concept which prominently displayed the slogan. And on September 7, 2004, he registered the domain name www.mylife-mycard.com and filed a trademark registration application for the slogan with the PTO the next day.

As it happens, also in the summer of 2004, American Express hired an advertising agency to develop a new global campaign for its products. On July 22, 2004, the agency proposed a campaign to American Express featuring the MY LIFE. MY CARD. slogan. After American Express expressed interest in the campaign, the agency's outside counsel conducted a preliminary trademark search for the availability of the slogan as a service mark on July 29, followed by a full trademark search on July 31, which was two days before the scheduled delivery date of Goetz's proposal to American Express. American Express decided to proceed with the MY LIFE. MY CARD. campaign and therefore registered the domain name www.mylifemycard.com on September 1, 2004, and filed an ITU application with the PTO on September 15.

As I said, remarkable coincidence.

As for the legal issue--this is after all a legal blog--American Express won on summary judgment and Goetz's counterclaims were dismissed because both the District Court and the Second Circuit concluded that he did not use the slogan as a trademark.

Virtual world goods have real world value

sl@hllaw.com (Stacia Lay) — Thu, 03 Jan 2008 09:12:58 -0800

The valuation of virtual goods continues to be of interest to both attorneys and gamers--the two of course not being mutually exclusive--and the Law of the Game has an interesting tidbit about a virtual "seizure" of such goods.