JOLT Digest

By Matthew Becker
Edited by Matt Gelfand
Editorial Policy

The application of copyright in the space of virtual worlds has been a subject of increasing consideration in the legal community over the past few years.[i] Literature on this subject has often centered on two focal points: the existing laws and approaches that are likely to produce successful litigation in this evolving arena; and the idea that the best approach to settling copyright disputes might be to try to find recourse through the entity that owns and operates the virtual world, rather than through litigation. Less common, however, is a substantive analysis of why the existing copyright regime generally fails to provide a suitable venue for addressing grievances, and how it could be reformed to better suit the virtual context. The purpose of this article is to foster such a discussion by exploring the disconnect between the copyright regime in the United States, which has evolved in a physical environment, and the distinct problems and requirements that arise in a virtual environment. In the process, this article will explore three options for ameliorating the situation – two that are legal in nature, and one that is extra-legal. (more…)

By Alea Mitchell
Edited by Cary Mayberger
Editorial Policy

Innovative hosting of user-generated content on the Internet, and a subsequent increase in unauthorized copyrighted material among this content, means reimagining copyright jurisprudence. The issue of how we protect an owner’s “exclusive” right to reproduce, distribute, and publicly perform his or her work, while not stifling advances in global communication and technology, underlies the concern in recent infringement suits brought against online hosts like YouTube, eBay, Hi5, and Veoh. See 17 U.S.C. § 106(1), (3), (4) (1976). But while the legal system has risen to the challenge with reinterpreted rules and legislation, Facebook continues to defy categorization.

This comment attempts to demonstrate the difficulty in categorizing certain service providers by looking at Facebook in the wake of the Viacom International v. YouTube, Inc. decision, No. 07 CIV. 2103, 2010 WL 2532404, at *8-9 (S.D.N.Y. June 23, 2010), of which Facebook filed a joint amicus brief in support of the defendants. Part I of the comment presents a brief overview of the Viacom court’s interpretation of “safe harbors” provided under the Digital Millennium Copyright Act (“DMCA”) and Facebook’s amicus brief. Part II explores whether certain activities on Facebook constitute copyright infringement. Finally, Part III pools these two together and examines why the DMCA “notice-and-takedown” process, as articulated in Viacom, may not be a workable copyright protection scheme for Facebook. Ultimately, I suggest that Facebook’s blurred private/public structure makes it unlikely that the DMCA notice-and-takedown scheme can adequately protect copyrights infringed by Facebook users. (more…)

The Digest will be taking a short break from our regular coverage over the coming weeks as our Staff Writers finish fall examinations and go on holiday.

While we take our hiatus from regular coverage, we have the pleasure of re-introducing our Comments feature. Comments are longer opinion pieces on especially significant issues. These pieces are written entirely by members of our staff, on topics they believe warrant closer examination and study. From now until mid-January, we will publish one Comment every week. We have great pieces this year and we hope you enjoy them!

We’ll be back sometime in January with our usual coverage.

We sincerely hope you’ve enjoyed our work this year!

- The Digest Staff

District Court Looks Unfavorably Toward Unilateral Contract Amendments through Web Page Updates
By Katie Booth – Edited by Esther Kang

Roling v. E*Trade Securities, LLC, No. 10-0488  (N.D. Cal. Nov. 11, 2010)
Slip Opinion hosted by Scribd.com

The U.S. District Court for the Northern District of California held that plaintiffs’ claim that E*TRADE’s brokerage agreement was unconscionable was sufficient to survive a motion to dismiss. E*TRADE could change the terms of the brokerage agreement by posting revised terms on its website. According to Judge Marilyn Patel, plaintiffs’ allegations that E*TRADE’s brokerage agreement was both unilateral and did not provide for adequate notice of changes to consumers  were sufficient to allege a claim for unjust enrichment based on unenforceability.

Eric Goldman comments on the decision. He particularly notes that agreements like E*TRADE’s brokerage agreement, which allow companies to make unilateral modifications to contract terms by posting changes on the their websites, pose great risks that courts will find these provisions unconscionable and ultimately invalidate the entire contract. (more…)

By Emily Hootkins

FTC Proposes ‘Do Not Track’ System for the Web

CNET reports that the Federal Trade Commission is endorsing a “Do Not Track” mechanism for the web, reminiscent of its popular “Do Not Call” list. David Vladeck, director of the FTC’s Bureau of Consumer Protection, envisions the concept as “a setting similar to a persistent cookie” that would signal whether the consumer is willing to be tracked or receive targeted advertisements. PC Magazine highlights some potential technical difficulties of such a proposal, such as the absence of a persistent, individualized identifier: unlike telephone numbers, a person’s IP address can change, and computers are often operated by multiple users. The FTC is currently asking stakeholders to submit comments on this proposal.

Federal Authorities Drop Charges in Xbox-Modding Suit

PCWorld reports that the first criminal trial for game-console modding has been dismissed. The prosecution dropped the case “based on fairness and justice,” after conceding its error in not disclosing to the defense important facts that would be presented in the first witness’ testimony. As Wired reports, federal authorities charged Matthew Crippen with modifying Xboxes to enable them to play pirated games. Crippen was prosecuted under untested provisions of the Digital Millennium Copyright Act; it remains to be seen whether the government will make another attempt at pursuing criminal charges for game-console modding.

Congress Approves Legislation to Regulate Sound Volume of Television Advertisements

The Wall Street Journal reports that Congress has approved legislation prohibiting television advertisements from being played at volumes louder than regular television programming. The bill, known as the Commercial Advertising Loudness Migration (CALM) Act, will require advertisers to adopt industry technology that modulates sound levels. Ars Technica notes that loud commercials are consistently one of the most common consumer FCC complaints about television. If President Obama signs the bill into law, advertisers will have one year to come into compliance with the Act.

Senate Judiciary Committee Passes Fashion Design Protection Bill

The Wall Street Journal reports that the Senate Judiciary Committee has unanimously passed the Innovative Design Protection and Piracy Prohibition Act. If enacted, this bill will give clothing designers intellectual property rights in their fashion designs. The bill provides a three-year term of protection for designs that demonstrate novelty and originality. According to Reuters, the bill contains important exceptions that address controversial aspects of previous bills providing for fashion copyrights. There is an “independent creation” defense, which a designer can assert if an independently-created design happens to overlap with a copyrighted design. The bill also includes a home sewing exception, and establishes a strict standard that requires designs to be “substantially identical” to support claims of infringement.