- Clearing the air. Aereo, the startup broadcasting service that lost big in the U.S. Supreme Court last June, just lost another, and possibly its last, court battle. A U.S. district judge in the Southern District of New York, responding to a motion filed by the major broadcasting networks, granted a preliminary injunction barring Aereo from retransmitting programs to its subscribers while the programs are still being broadcast . The ruling by U.S. District Judge Alison Nathan also rejected Aereo’s argument that it should be able to take advantage of the statutory compulsory license applicable to cable systems.
- Let’s be friends. Twitter’s relationship with app developers has been somewhat strained since the microblogging platform tightened its rules on outside apps a couple years back. That’s all changing now, as Twitter convened its first mobile app-developer conference in four years. The event in San Francisco attracted 1,000 developers. At the conference, Twitter introduced Fabric, a set of developer tools that are intended to make it easier for developers to build apps and make money from them. It looks as if Twitter is taking note of the similar steps that Google, Facebook and others are taking to attract app developers.
- Sharing the wealth. A New York-based tech startup called Tsu is trying to establish a whole new business model for a social network. Tsu, which has attracted a $7 million venture capital investment from Sancus Capital, will pay users based on the advertisements that their postings attract. Tsu keeps only 10 percent of the revenue that it receives from ads, sponsorships, and third-party applications. The other 90 percent is divided into two pools of money. Half of it goes to the content creator who posted the content that attracted the ad. The other half goes to the social network that recruited that content creator.
- Time change. Until now, Twitter has made a clear distinction between people you follow and people you don’t follow: You only saw tweets from those whom you followed. Now, the service, in what it calls a “timeline experiment,” will place tweets on your timeline from select users that you are not following. Twitter is using an algorithm that determines which such tweets you will see based on the users that you do follow, the popularity of the users you do not follow, and other factors. You won’t be able to opt out of this feature and some frequent Twitter users have complained that it removes one of the factors that distinguishes Twitter from other social media platforms.
- False flag. We wrote recently about the fake Facebook account that the Drug Enforcement Administration created to gather information for a narcotics investigation. On October 17, Facebook’s chief security officer wrote a letter to DEA Administrator Michele Leonhart calling the agency’s actions a “knowing and serious breach” of Facebook’s policies. Facebook asked the DEA to confirm that it had stopped engaging in this tactic. Facebook’s letter specifically questioned the DEA’s contention that the woman who was the subject of the fake account implicitly consented to use of her personal information for such purposes when she consented to a search of her phone.
- Square deal. Foursquare has been known mostly as a check-in app – a place where you post your location but not much more. The company’s new ad campaign hopes to change that image and to position Foursquare as a food-oriented rating and recommendation network similar to Yelp and Urbanspoon. “Introducing the all-new Foursquare, which learns what you like and leads you to places you’ll love,” is the new slogan on the Foursquare website. The ad campaign will roll out in mass transit in New York and Chicago and in bike-share locations in the Windy City.
From our sister blog, MoFo Tech:
Within a decade, analysts say, the “Internet of Things” will have transformed our lives. Billions of Internet-connected devices will monitor our homes, businesses, cars, and even our bodies, using the data to manage everything from appliances to heart monitors. Companies like Google— which recently paid $3.2 billion for smart-thermostat company Nest Labs—are already racing to build the IoT. But businesses face fundamental questions regarding the ownership of data, protecting customer privacy, liability when devices fail, and more.
The IoT will connect product developers and manufacturers in countless new ways, creating uncertainty about ownership of and rights to customer data. If a company contracts with a big data vendor to store and process consumer information, for instance, each party will need to know that its partner has the legal rights to collect or share data, says Alistair Maughan, a partner in Morrison & Foerster’s London office who is co-chair of the Technology Transactions Group. Then there is the question of who owns the data. “There is a whole supply chain the law is only beginning to grapple with,” Maughan says. “Manufacturers will need to understand the risks when there aren’t clear government standards.”
An area of major interest is how companies will protect customer privacy when so much data is in play. Companies need to make sure that what they say about their use of data collected from connected devices is accurate, complete, and up to date. “There is no one-sizefits-all approach to data security,” says Morrison & Foerster partner D. Reed Freeman Jr., who specializes in privacy matters. “The burden for a company is to consider what kind of data you have and how to protect against reasonably foreseeable, unauthorized access to personal information.”
Liability, of course, is a paramount concern when connected businesses adjust their use of data for new business or consumer products, says Stephanie Sharron, a Morrison & Foerster partner and a member of the firm’s Technology Transactions Group. Using vast sets of data to find patterns and targets will leave open all sorts of possibilities for technical and human mistakes. “There are questions about who should bear responsibility for inaccurate inferences or patterns that give rise to harm,” Sharron says. “Or who is responsible if a pattern comes from inaccurate data from a malfunctioning sensor.”
Then there is the question of who will manage and monitor the electrical systems needed to operate such vast networks—traditional public utility companies, new electricity market participants, or a combination. “Customers will want more choices to accommodate the new technologies and services they get to use” in the IoT, says Robert S. Fleishman, senior of counsel for Morrison & Foerster and an expert on energy regulation law. “Generally it will be up to state public utility commissions to decide who gets to provide the traffic control function and related activities for these things to operate within the system for distributing energy.” Some state utility commissions have already started to look at reforming their regulations and policies.
- Court spanks parents. In a landmark decision, the Georgia Court of Appeals ruled in Boston v. Athearn that parents can be held responsible for the social media activities of their kids. The case involved a seventh-grade boy who, with assistance from a friend, created a fake Facebook profile for a female classmate; then, pretending to be the classmate, the boy made a series of offensive and outrageous posts, some of which falsely claimed that the classmate suffered from mental illness and took illegal drugs. Following complaints from the victim’s parents, the school suspended the boy for several days, and his parents grounded him for a week; the fake profile, however, remained on Facebook for eleven months. The victim, through her parents, ultimately sued the boy and his parents and the Georgia Court of Appeals, reversing a lower court decision to the contrary, determined that a reasonable jury could find that the boy’s parents, after learning of their son’s behavior, failed to exercise due care from that point onward by allowing the fake profile to remain on Facebook, and that such negligence proximately caused some portion of the injury sustained by the girl. With the growth of cyberbullying, and in the wake of the Boston decision, will we see more suits seeking to hold parents liable for their kids’ online misconduct?
- The oversharing economy. An Uber driver in Albuquerque, New Mexico had his driver account for the company cancelled because of what Uber called “hateful statements regarding Uber through Social Media.” Turns out that he had posted a tweet linking to an article about robberies of Uber drivers, and had included the following observation: “Driving for Uber, not much safer than driving a taxi.” The driver, Christopher Ortiz, said he was just sharing a story that was going around. Uber quickly agreed that he had done no real harm and reinstated him with an apology, calling the original decision “an error.” After all, Ortiz had a high rating from customers (4.8 out of a possible 5), and Uber’s own position is that drivers associated with the company are independent contractors, not company employees.
- What’s not to like? Copyblogger, a highly successful social media and online marketing company, has decided to ditch its Facebook presence – even though it had 38,000 fans for its Facebook page. After a good deal of thought, the company concluded that “Copyblogger’s presence on Facebook has not been beneficial for the brand or its audience.” In a detailed essay, brand marketing consultant Erika Napoletano, whom Copyblogger had brought in for the purpose of improving its Facebook presence, explained the perhaps surprising decision. One of the main reasons: the 38,000 fans didn’t really interact with the page. “The page had an overwhelming number of junk fans. These are accounts with little to no personal status update activity that just go around “Liking” Facebook pages. They’re essentially accounts tied to “click farms”—ones paid pennies for every Facebook page they Like,” Napoletano wrote. For this reason and several others, Copyblogger decided that, going forward, it would be “on the Web, just not on Facebook.”
- Doctor in the mouse. What if you could input a list of your current symptoms to Google, and quickly be connected with a doctor for a brief consultation? For a limited trial period, Google seems to have set up such a system for people who are looking for medical advice online. A lot of the details aren’t known yet, but a Google spokesperson told a Gizmodo reporter, “When you’re searching for basic health information — from conditions like insomnia or food poisoning — our goal is provide you with the most helpful information available.” The feature is part of Google’s Helpouts video-chat service.
- Just shoot me. Data mining has reached the world of selfies. Social media users may not know this, but unless they have marked their photos posted on social media sites as private, the photos can be analyzed in bulk by third parties and used for marketing purposes. Privacy advocates say people should assume that their photos, unless clearly marked as private, are being scanned by market researchers. The rules and regulations applicable to this practice, including the privacy policies of the relevant social media platforms, are not always clear. So if you’ve posted a photo of yourself wearing a particular brand of ski gear on the mountain, some company may be making marketing decisions based on your photo and thousands of others. Soon, it may be targeting ads to you on that basis as well. For our own blog post on this subject, please click here.
- Mere threats? In 2010, Anthony Elonis, a man from western Pennsylvania, made a series of rants on Facebook in the form of rap lyrics that threatened to kill his wife, an FBI agent, and children in a kindergarten class. He claimed that he never intended to kill anyone and that he was merely venting. He also claimed that his comments were protected by the First Amendment. Elonis was nonetheless charged and convicted under a federal threat statute and sentenced to 44 months in prison. The U.S. Supreme Court will hear his appeal in December. The case raises important issues, including whether statements on social media should be treated differently from statements made on the phone or in person. Elonis wrote to the Court, for example, “Modern media allow personal reflections intended for a small audience (or no audience) to be viewed widely by people who are unfamiliar with the context in which the statements were made and thus who may interpret the statements much differently than the speakers intended.”
In June of this year, we sent out an alert about the anticipated new UK copyright infringement exceptions. These exceptions were to be introduced based on the recommendations of the Hargreaves Review. Surprisingly, some of the exceptions had been dramatically pulled from the legislative slate at the last minute. However, the UK government has now upheld its subsequent promise to re-publish the statutory instruments for the infringement exceptions for (1) personal use, (2) parodies and (3) quotations, with new legislation on all three subjects that came into force on October 1, 2014.
Almost in parallel, a European ruling and an Advocate General opinion have helped to prepare for the arrival of the two statutory instruments, with commentary on (i) the scope of parody and (ii) in relation to personal use, the impact of copyright levies.
The New Legislation
Two new regulations have come into force, amending the Copyright, Designs and Patents Act 1988 (the “CDPA”) to include new exceptions for copyright infringement. The first – the Copyright and Rights in Performances (Quotation and Parody) Regulations 2014 (the “Quotation and Parody Regulations”) – extends the provisions for quotations of copyright-protected works (having previously only been available for criticism and review), and creates a new provision for parodies. The second regulation – the Copyright and Rights in Performances (Personal Copies for Private Use) Regulations 2014 (the “Personal Copies Regulations”) – concerns making copies of copyrighted works for personal use.
From October 1, 2014, the free quotation of copyright protected works is no longer limited to reporting current events or to works of criticism or review. The Quotation and Parody Regulations, inserted into the CDPA as section 30(1ZA), now permit quotation for any purpose, provided that:
- the work quoted has been made publicly available;
- the use of the quotations constitutes “fair dealing” with the work;
- the extent of a quotation is no more than is necessary for the purpose; and
- the quotation is accompanied by sufficient acknowledgment to the copyright owner (unless this is impossible).
The UK Intellectual Property Office has stated that this amendment will help to save costs on copyright clearance, support free expression and align UK law with the rest of Europe. However, as anticipated in our previous alert, the Quotation and Parody Regulations do not provide a definition of “quotation”, or guidance as to how extensive a “quotation” is allowed to be. This may place undue pressure on the meaning of “fair dealing” as UK courts seek to define the scope of the exception.
The new exception for parodies allows fair dealing with a work for the purposes of caricature, parody or pastiche (section 30A of the CDPA) and provides that fair dealing with a recording or performance (section 2A to Schedule 2 of the CDPA) for the purposes of parody does not infringe copyright conferred in the performance or recording. This change now means that the permission of the copyright holder will no longer have to be obtained, provided that the use of the original work is fair and proportionate. This is good news for British comedians and artists, it would seem, unless, of course, it is their work that is being parodied.
However, an EU court ruling on parodies in September 2014 has already placed some restrictions on the new legislation. In Deckmyn v Vandersteen C-201/13, the Court of Justice of the European Union (the “CJEU”) defined a parody as something that evokes an existing work while being noticeably different from it and constituting an expression of humour or mockery. The CJEU also stated that national courts must strike a balance between copyright owners’ interests and mimickers, and that copyright owners have a legitimate interest in disassociating their work from a parody, if the parody involves a discriminatory message.
This creates a whole new checklist for UK courts to consider, alongside the usual fair dealing test. Judges will have to also hold a view on whether the parody (i) strikes a fair balance, (ii) differs noticeably from the original work, and (iii) is sufficiently humorous. In particular, the last of these requirements may worry budding parodists, who could end up having to justify their comedy in front of a very different audience than first intended.
In a little-noticed decision, Matter of Noel v. Maria, Support Magistrate Gregory L. Gliedman—a Staten Island, New York family court official—recently permitted a father seeking to modify his child support payments to serve process on the child’s mother by sending her a digital copy of the summons and petition through her Facebook account.
Magistrate Gliedman’s decision struck us at Socially Aware—where we follow such developments closely—as a groundbreaking move. We are unaware of any published U.S. court opinion permitting a plaintiff to serve process on a domestic, U.S.-based defendant through a Facebook account.
While the same federal district court subsequently allowed the FTC to serve defendants through Facebook in FTC v. PCCare247, the service at issue in that case concerned documents other than the summons and complaint, and the defendants were two India-based entities and three India-based individuals who had already appeared through counsel and shown themselves to be on notice of the lawsuit.
Other cases authorizing service via social media have been similarly limited in scope. For example, in WhosHere v. Orun, the U.S. District Court for the Eastern District of Virginia allowed service via social media on a defendant who allegedly resided in Turkey. In Mpafe v. Mpafe, a Minnesota family court authorized the service of divorce proceedings on a defendant by “Facebook, Myspace or any other social networking site” where the defendant was believed to have left the country.
- Big and bigger. Facebook and Twitter are the leading social media networks and, according to a recent Forbes article, they have some interesting similarities and key differences. Facebook is clearly the larger and more successful platform, with over 1.3 billion monthly active users and $2.9 billion in quarterly revenue, compared to Twitter’s 271 million monthly active users and $312 million in quarterly revenue. Both rely heavily on mobile users, with 86 percent of Twitter’s traffic coming via mobile devices while 68 percent of Facebook’s traffic is through such devices. And, every minute, there are roughly 350,000 tweets and 382,000 Facebook “likes.” Not bad for a 10-year old (Facebook) and an 8-year old (Twitter).
- New media, meet old media. Can success on the ultra-popular social network YouTube translate into success in, of all things, printed books? The book publishing industry is betting that it can, and has searched the world of pop-culture personas on YouTube for people who might be able to convert their millions of online followers into book readers. Take Michelle Phan, whose YouTube channel with makeup and beauty advice has attracted more than seven million subscribers. Her new book, “Make Up,” is set for publication this month, and is generating a big buzz. One industry executive dubs the video stars-turned-authors phenomena a “book-publishing tsunami.”
- Glass pain. We’re all aware that alcohol, drugs, smoking and gambling can become dangerous addictions. Will we soon be adding wearable computers to this list? According to The Guardian, scientists have recently diagnosed and treated a man “believed to be the first patient with internet addiction disorder brought on by overuse of Google Glass.” The patient reportedly removed his Glass only to shower and sleep, and, while sleeping, viewed his dreams as if he were still wearing the device. Although being treated for Glass addiction and alcohol addiction at the same time, the patient informed his doctors that his withdrawal from Glass was more difficult than his withdrawal from alcohol.
Congratulations to Socially Aware’s London-based correspondent Sue McLean for being shortlisted for the Women in the City Woman of Achievement Awards 2014. Established in 2007, these awards recognize senior level women who are actively promoting and encouraging the progress of women within their own organizations and beyond. Winners will be announced on October 23 at a celebration evening. In addition to her many contributions to Socially Aware, Sue is of counsel in Morrison & Foerster’s Technology Transactions Group, is the founder and chair of the firm’s MoFo Women affinity group, and manages and mentors a number of lawyers in the firm. She is also a passionate advocate of gender diversity in tech. Just this week she hosted and chaired a “Women in Technology” roundtable with Harriet Minter of The Guardian newspaper. Senior women from leading companies such as VMware, Oracle, Intel, IBM, and Fujitsu, along with other representatives from across the sector, attended to discuss how we can improve gender diversity in tech. It was a great success and follow-up sessions are planned.
- Buy local. Facebook has just announced that it’s going to provide hyper-local advertising services for merchants who want to reach consumers in very specific geographic areas. This new feature reportedly will allow a business to target just those consumers who are within a mile of the physical location of such business. Facebook is able to roll out this new business because so many of Facebook’s one billion plus mobile users permit Facebook to collect their location information, or otherwise provide Facebook with the data needed to allow hyper-local ads. This new feature should launch in the United States in just a few weeks.
- Psst – wanna know a secret? Secret is a hot new social network designed to permit people to share their secrets online in a completely anonymous setting, without letting anyone know who has made the post. But how secure is it actually? According to a Wired article, not very secure. “White hat” hackers – those who try to find the vulnerabilities of a network without doing harm – have repeatedly found out people’s supposed secrets by using basic hacking techniques. The best-known hack works only one way; the hacker can find a person’s secret if the hacker knows the person’s e-mail address, but can’t tie a posted secret to any particular individual. The Wired article raises an interesting question as to whether any app or platform can be truly social and truly secret at the same time.
- Nyet. The U.S. Court of Appeals for the Second Circuit recently rejected an effort by prosecutors to use a profile page from a popular Russian social media platform, Vk.com, to link a defendant with the sending of an allegedly fake birth certificate from a particular e-mail address. The Vk.com profile page at issue included a photograph of the defendant and the name “azmadeuz,” which was part of the e-mail address in question. The trial court had admitted the page into evidence, but the Second Circuit reversed, finding that, although it doesn’t take much to authenticate evidence, the page at issue could not be authenticated. In particular, the Second Circuit found that there could be no “reasonable conclusion” that the page at issue belonged to the defendant and wasn’t bogus in some way. The truly interesting question is whether there should be a higher standard for authenticating social media and other Internet-based evidence; the Second Circuit, however, declined the opportunity to set such a higher standard; rather, the focus should remain on the specific facts surrounding the specific item of evidence to be authenticated.