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Whack-a-troll Legislation

Written by Asher Lowenstein     —   Edited by Yaping Zhang

Patent assertion entities’ extensive litigation activities in different states enables to assess the efficacy of the proposed bills against legal strategies these trolls, such as MPHJ Technology, have engaged in. The legal battles confirm some of the concerns about the usefulness of proposed regulatory measures.

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3D Systems and Formlabs Settled Two-Year Patent Dispute

By Yixuan Long – Edited by Yaping Zhang

On December 1, 3D Systems and Formlabs settled their two-year legal dispute over the 520 Patent infringement. Terms of the settlement are undisclosed. The patent covered different parts of the stereolithographic three-dimensional printing process, which uses a laser to cure liquid plastic. 3D Systems was granted the ‘520 Patent in 1997. Formlabs views the settlement as enabling it to continue its expansion and keep developing new products.

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Privacy Concerns in the Sharing Economy: The Case of Uber 

By Sabreena Khalid – Edited by Insue Kim

Recent revelations about Uber’s disconcerting use of personal user information have exposed the numerous weaknesses in Uber’s Privacy Policy. The lack of regulation in the area, coupled with the sensitive nature of personal information gathered by Uber, makes the issue one requiring immediate attention of policy makers.

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San Francisco Court Considers Google’s Search and Ad Services Free Speech

By Jens Frankenreiter – Edited by Henry Thomas

A San Francisco court dismissed a lawsuit against Google, treating Google’s search and advertisement services as constitutionally protected free speech. The lawsuit alleged an antitrust violation based on unfavorable treatment of a website in Google’s search results, and on the withdrawal of third-party advertisement from the website. In throwing out the lawsuit, the court applied California’s “anti-SLAPP” law, which allows quick dismissal of lawsuits against acts protected as free speech.

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EU Unitary Patent System Challenge Unsustainable: Advocate General

By Saukshmya Trichi – Edited by Ashish Bakshi

The Advocate General of the Court of Justice of the European Union has rendered an opinion on Spain’s challenges to regulations implementing the European Unitary Patent System. The Advocate General opines that the challenges must be dismissed as the system is intended to provide genuine benefit in terms of uniformity and integration, and safeguard the principle of legal certainty, while the choice of languages reduces translation costs considerably.

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Second Circuit Holds that Goldman Sachs’s Proprietary Source Code Is Intangible Property under the NSPA
By Laura Fishwick – Edited by Lauren Henry

United States v. Aleynikov, No. 11-1126, 2012 WL 1193611 (April 11, 2012).
Slip Opinion

The Second Circuit reversed the holding of the District Court of the Southern District of New York, and found that source code is not a good, ware, or merchandise under the National Stolen Property Act (“NSPA”), a criminal statute that applies to anyone who “transports, transmits, or transfers in interstate or foreign commerce any goods, ware, merchandise, securities or money … knowing the same to be stolen, converted or taken by fraud.” 18 U.S.C. § 2314. The district court had found that because the source code was related to Goldman Sachs’s high-frequency trading (“HFT”) system, and this system contained confidential trade secrets that would be highly valuable to other firms, the source code was a “good” that was “stolen” within the meaning of the NSPA and Aleynikov had violated the statute.

Wired provides an overview of the case. While agreeing with the Second Circuit’s holding, Techdirt admonished the court for incorrectly calling the charges against Aleynikov “theft,” when should be more accurately described as “infringement.” (more…)

Posted On Apr - 19 - 2012 Comments Off READ FULL POST

Ninth Circuit Creates Circuit Split by Narrowly Construing the Computer Fraud and Abuse Act
By Abby Lauer – Edited by Charlie Stiernberg

United States v. Nosal, No. 10-10038 (9th Cir. April 10, 2012)
Slip Opinion

The Ninth Circuit affirmed the Northern District of California in an en banc decision construing the scope of the Computer Fraud and Abuse Act (“CFAA”). The court held that a person who violates an employer’s computer use policy is not criminally liable for federal penalties under the Act.

The Ninth Circuit held that the provision of the CFAA that prohibits a person from “exceed[ing] authorized access” to information on the Internet does not extend to violations of use restrictions, such as an employer’s computer use policy or a website’s terms of service. In so holding, the court applied the rule of lenity to this provision of the CFAA. The court expressed concern that adopting a broader interpretation of “exceeds authorized access,” which appears five times in the first seven subsections of the statute, would inadvertently criminalize innocuous activity that was not intended to be captured. For example, the court noted that “lying on social media websites is common,” and concluded this is not the type of behavior that Congress intended to punish by passing the CFAA.

Ars Technica provides an overview of the case. The Volokh Conspiracy provides further commentary and excerpts from Chief Judge Kozinski’s majority opinion. (more…)

Posted On Apr - 18 - 2012 1 Comment READ FULL POST

Written by Kassity Liu
Edited by Andrew Segna
Editorial Policy

Social media has taken our society by storm. From Facebook to Twitter to LinkedIn, social media has provided individuals with newer and faster ways to communicate with one another. In 2011, eBizMBA estimated that 700 million unique users visited Facebook per month, 200 million users visited Twitter, and 100 million users visited LinkedIn. These statistics are staggering. The entire population of the United States, as reported by the U.S. Census Bureau, only totals 312 million.[i]

With the growing use of social media, many businesses in the U.S. have started to use social media as a method of advertising their products to consumers. Large conglomerates such as General Electric and Procter & Gamble have incorporated social media into their advertising and promotional efforts.[ii] Companies including AT&T and Dell have used Facebook, Twitter, and YouTube to communicate with consumers and market their products.[iii] In 2010, Facebook boasted that over 1.5 million local businesses had active Facebook pages.

However, unlike these companies, pharmaceutical companies have taken a cautious approach to social media. In 2008, the U.S. pharmaceutical industry only allocated a “tiny fraction” of “less than 4% of the more than $4 billion it spent on direct-to-consumer advertising” on social media advertising.[iv] Unlike advertising in other industries, prescription drug advertising is regulated by the U.S. Food and Drug Administration (FDA). This means that drug companies are only allowed to advertise their products under a regulatory scheme that is set up by the FDA. Although some venturous drug companies have chosen to invest their dollars in social media advertising before the FDA provides the industry with clear guidance, many have been waiting for the agency to publish a guidance document on social media advertising.

With respect to social media, the FDA has only published a draft guidance on “responding to unsolicited requests for off-label information about prescription drugs and medical devices.” The fifteen-page document addresses how companies should respond to online inquiries about off-label uses of their products, but does not provide clear instructions to the industry about how to advertise their products using social media. Despite not having clear guidelines on the use of social media, pharmaceutical companies need to start exploring this evolving area of technology. Working within the current regulatory scheme, the pharmaceutical industry can use social media not only for the industry’s own benefit but also for the benefit of drug users and the medical community. Moreover, even if pharmaceutical companies choose to avoid using social media, this would not stop physicians and patients from sharing information about the companies’ products online. Therefore, in order to effectively monitor and convey reliable information about their products to consumers, companies may have to learn how to use social media sooner or later.  (more…)

Posted On Apr - 17 - 2012 1 Comment READ FULL POST

Fourth Circuit Holds Google’s Keyword Advertising May Infringe Trademark
By Michael Hoven – Edited by Abby Lauer

Rosetta Stone Ltd. v. Google, Inc., No. 10-2007 (4th Cir. Apr. 9, 2012)
Slip opinion

The Fourth Circuit affirmed in part, vacated in part, and remanded to the Eastern District of Virginia, which had granted Google summary judgment in holding that Google was not liable on all trademark infringement and trademark dilution claims brought by plaintiff Rosetta Stone in 2009.

The Fourth Circuit held that a reasonable trier of fact could find Google liable for direct infringement, contributory infringement, or dilution of trademark by allowing advertisers to bid on the trademarks of third parties. The court flatly rejected Google’s functionality defense, while affirming summary judgment for Google on vicarious infringement and affirming the dismissal of Rosetta Stone’s unjust enrichment claim. The court restored the direct infringement claim because there was a question of fact about consumer confusion. On the contributory infringement claim, the court concluded that there was a question of fact as to whether Google continued to sell keywords to advertisers it knew were engaging in trademark infringement. In so holding, the court stated that the district court had applied the wrong standard of review for summary judgment but said little about the lawfulness of keyword advertising.

MSNBC.com provides an overview of the case. On the Technology & Marketing Law Blog, Eric Goldman criticized the decision for ignoring the policy interests at stake and delaying an “inevitable” consensus that keyword advertising does not violate trademark law. (more…)

Posted On Apr - 16 - 2012 Comments Off READ FULL POST

Federal Circuit Declares Pharmaceutical Patents Unenforceable for Inequitable Conduct
By Laura Fishwick – Edited by Jennifer Wong

Aventis Pharma S.A. v. Hospira, Inc., No. 2011-1018, 2012 WL 1155716 (Fed. Cir. April 9, 2012).
Slip Opinion

The Court of Appeals for the Federal Circuit affirmed the U.S. District Court for the District of Delaware‘s holding that claim 5 of Aventis Pharma’s U.S. Patent No. 5,750,561 (filed August 4, 1993) (“the ‘561 patent”) and claim 7 of its U.S. Patent No. 5,714,512 (filed August 23, 1993) (“the ‘512 patent”) were invalid for obviousness under 35 U.S.C. § 103 and unenforceable on inequitable conduct grounds. Reviewing the district court’s factual findings for clear error and its ultimate finding of inequitable conduct for abuse of discretion, the Federal Circuit found that both patents were unenforceable for inequitable conduct, because the defendants had met their burden of showing that the withheld references were material to patentability and that the applicant intended to deceive the U.S. Patent and Trademark Office (“PTO”), primarily relying on testimony by the patents’ inventor.

PharmaPatents provides an overview of the case. Patents4Life suggests that the case may have come out differently had the inventor “professed to have no recollection” of the events which happened twenty years ago. Bloomberg Businessweek discussed the financial impact of generic drug manufacturers on Sanofi. (more…)

Posted On Apr - 14 - 2012 Comments Off READ FULL POST
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