The Fed, Treasury Department Release Joint Final Rule Implementing UIGEA
By Linda Tieh – Edited by Dmitriy Tishyevich

Federal Reserve Board
Department of the Treasury 
Federal Register Notice

On November 12, 2008, the Department of Treasury and the Federal Reserve Board, in consultation with the Department of Justice, jointly published final rule 12 C.F.R. Part 233, implementing the Unlawful Internet Gambling Enforcement Act (“UIGEA”) of 2006.   The UIGEA prohibits gambling businesses from knowingly accepting payments in connection with unlawful Internet gambling, including payments made through credit cards, electronic transfers, and checks.  The final rule requires U.S. financial firms participating in certain payment systems to establish and implement written due diligence policies and procedures that are reasonably designed to prevent transactions in connection with unlawful Internet gambling.  The Treasury Department has said that “unlawful Internet gambling” generally covers making a bet that involves use of the Internet and is unlawful under applicable federal or state laws in the jurisdiction where the bet is initiated, received, or otherwise made.  The rule is effective as of January 19, 2009, and compliance by companies is required by December 1, 2009.

The Department of the Treasury has issued a press report on the final rule. 

Reuters suggests that Republican lawmakers, who controlled Congress in 2006, passed the UIGEA in hopes of having a rule issued before Bush leaves office in January, and notes that its passage cost Europe’s online gambling companies billions in lost market value as they had to withdraw from providing service to the U.S., one of their most lucrative markets. The Associated Press reports that the final regulation drew criticism from Democrats who believe financial services companies will be burdened. 

Poker News Daily likewise criticizes the regulations as “midnight rule-making” by the Bush Administration, arguing that the final rule leaves unclear which gaming activities are legal and which are not. The Poker Players Allinace (PPA), a poker grassroots advocacy group, agrees the rule failed to clarify the differences between legal and illegal gambling activities. 

(more…)

Supreme Court Rules for Navy in Use of Sonar in Training Exercises
By Jared Frisch – Edited by Dmitriy Tishyevich
Winter v. Natural Resources Defense Council, Inc.
Supreme Court of the United States, November 12, 2008, No. 07-1239
Slip Opinion

The Supreme Court reversed a decision by the U.S. Court of Appeals for the Ninth Circuit and vacated in part a preliminary injunction that had restricted sonar training operations by the US Navy. The training operations were alleged to damage marine life in violation of the National Environmental Policy Act of 1969 (“NEPA”). The Court applied an equitable balancing test, determining that the likelihood of irreparable injury to the environment was outweighed by the public interest and the Navy’s interest in “effective, realistic training of its sailors.”

Mainstream reporting on the Supreme Court decision can be found at New York Times and the Associated Press.  Further commentary following the case is available at Slashdot and ScotusBlog.

(more…)

Harry Potter Lexicon Defendant Files Notice of Appeal
Notice of Appeal (hosted by Justia)

On November 7, 2008, defendant RDR Books filed a notice of appeal to the Second Circuit from the September 9, 2008 decision of the S.D.N.Y., which permanently enjoined its publication of the Harry Potter Lexicon book and awarded plaintiffs Warner Brothers and J.K. Rowling statutory damages of $6,750.

Previously: Harry Potter Lexicon Found to Infringe J.K. Rowling’s Copyright

Court Declares “Grand Theft” Crime Free
By Briahna Gray – Edited by Miriam Weiler

E.S.S. Entertainment 2000, Inc., v. Rock Star Videos, Inc., November 5 2008, No. 06-56237
Slip Opinion

On November 5, 2008 the Ninth Circuit Court of Appeals upheld a Central California District Court summary judgment ruling to dismiss the case brought by the operators of a Los Angeles strip club (“E.S.S.”) against Rock Star Videos (“Rockstar”), the manufacturer of the Grand Theft Auto video games, for trademark infringement and unfair competition under the Lanham Act, California Business and Professions Code § 14320 and § 17200 and California common law.

E.E.S. had argued that Rockstar’s imitation of the strip club’s logo within the virtual world of Grand Theft Auto: San Andreas had no artistic relevance and would mislead consumers, confusing them as to whether EES had endorsed or associated itself with the digital rendition. In resolving this claim, the court applied a balancing test to weigh Trademark interests against First Amendment rights, stating that the Lanham Act applies to artistic works “only where the public interest in avoiding consumer confusion outweighs the public interest in free expression” Rogers v. Grimaldi, 875 F.2d 994, 999 (2d Cir. 1989) (emphasis in the original).

The ruling affirming summary judgment in favor of the popular game has drawn attention from a number of commentators. The authors at Techdirt.com applaud the decision. Coverage is also offered by Gamastura.com, Techdirt.com and Filewrapper.com summarize the case. RealDealDocs.com lists other legal challenges Grand Theft Auto has faced in the past six years.

(more…)

Australia Poised to Begin Internet Filtering Program Unprecedented in Scope for Modern Democracy
By Debbie Rosenbaum
Editorial Policy 

If the presumption that democracy depends upon the widest possible access to uncensored ideas, data, and opinions is true, then there is cause for great alarm as one of our nation’s closest democratic allies moves to drastically curtail this foundational freedom within its boarders. The Australian government will likely enact legislation that will make sweeping, compulsory Internet censorship a startling reality for all Australian citizens. Spearheaded by the Minister for Broadband, Communications and Digital Economy, Senator Stephen Conroy, and backed by $44.2 million from the government’s $125.8 million Plan for Cyber-Safety budget, the planned filter (part of the NetAlert program) will render Internet access in Australia similar to that in Iran or China.

Australia’s Federal Government announced its ambitious web censorship plan in December 2007. The goal of the program is seemingly well intentioned: to shield children from violent and pornographic sites. (See the Australian government’s “Children Are Sacred” report, which discusses instances of child sexual abuse in the Northern Territories). The Family First Party, a relatively minor party with only one Member of Parliament, originally championed the filter, also known as the “clean feed” policy. The Party’s proposal has earned wider support from both Senator Conroy and the Rudd-Labor Government. Senator Conroy is expected to call for bids from Australian software makers, and reportedly wants to begin live trials by the end of the year.

(more…)