In what is being described as “the first settlement to deem such sales illegally deceptive,” New York Attorney General Letitia James has entered into a settlement with a company that had been selling fake followers, likes and views on several social media platforms. Read how much revenue the sales were generating for the
Finding that President Trump’s Twitter feed constitutes a public forum, a federal judge in New York City held that it’s a First Amendment violation when the President or one of his assistants blocks a Twitter user from viewing or responding to one of the President’s tweets. As the New York Times points out, the decision…
A recent German Federal Court of Justice decision may have a significant impact on content providers’ business models. Offering software that allows users to block advertising does not constitute an unfair commercial practice. Even providing advertisers with the option to pay for showing certain ads—a practice known as whitelisting—does not violate the unfair competition rules.
Issued on April 19, the decision involved a legal dispute between the ad blocking software provider Eyeo GmbH and the online-content provider Axel Springer (which also happens to be Germany’s largest publishing house). The decision overruled the Higher Regional Court of Cologne’s previous decision, which, like the Federal Court of Justice, did not categorize Eyeo’s offer of its ad blocking product as an unfair competition practice, but did categorize paid whitelisting as unlawful.
Axel Springer is now left with the final option of taking the case to the Federal Constitutional Court.
Background and core arguments of the parties
Eyeo, a German software company, offers the product AdBlock Plus, which allows Internet users to block ads online. The product became the most popular ad blocking software in Germany and abroad, with over 500 million downloads and 100 million users worldwide.
In 2011, the company started to monetize its product by offering a whitelisting service that gives advertisers the option to pay to show their ads. To get on Eyeo’s list of companies whose ads are not blocked, advertisers have to comply with Eyeo’s “acceptable advertising” conditions and share their ad revenue with the company. The conditions dictate the advertising’s features such as its placement, size, and—in the case of text advertising—color.…
Continue Reading German Federal Court: Unfair Competition Law No Basis to Ban Ad Blocking and Whitelisting
As Socially Aware readers know, social media is transforming the way companies interact with consumers. Learn how to make the most of these online opportunities while minimizing your company’s legal risks at Practising Law Institute’s (PLI) 2018 Social Media conference, to be held in San Francisco on Thursday, February 1st, and in New…
Happy 2018 to our readers! It has become a Socially Aware tradition to start the New Year with some predictions from our editors and contributors. With smart contracts on the horizon, the Internet of Things and cryptocurrencies in the spotlight, and a number of closely watched lawsuits moving toward resolution, 2018 promises to be an exciting year in the world of emerging technology and Internet law.
Here are some of our predictions regarding tech-related legal developments over the next twelve months. As always, the views expressed are not to be attributed to Morrison & Foerster or its clients.
From John Delaney, Co-Founder and Co-Editor, Socially Aware, and Partner at Morrison & Foerster:
Regarding Web Scraping
Web scraping is an increasingly common activity among businesses (by one estimate, web-scraping bots account for as much as 46% of Internet traffic), and is helping to fuel the “Big Data” revolution. Despite the growing popularity of web scraping, courts have been generally unsympathetic to web scrapers. Last August, however, web scrapers finally received a huge victory, as the U.S. District Court for the Northern District of California enjoined LinkedIn from blocking hiQ Labs’ scraping of publicly available user profiles from the LinkedIn website in the hiQ Labs, Inc. v. LinkedIn Corp. litigation. The case is now on appeal to the Ninth Circuit; although my sense is that the Ninth Circuit will reject the broad scope and rationale of the lower court’s ruling, if the Ninth Circuit nevertheless ultimately sides with hiQ Labs, the web scraper, the decision could be a game changer, bringing online scraping out of the shadows and perhaps spurring more aggressive uses of scraping tools and scraped data. On the other hand, if the Ninth Circuit reverses, we may see companies reexamining and perhaps curtailing their scraping initiatives. Either way, 2018 promises to bring greater clarity to this murky area of the law.
Regarding the Growing Challenges for Social Media Platforms
2017 was a tough year for social media platforms. After years of positive press, immense consumer goodwill and a generally “hands off” attitude from regulators, last year saw a growing backlash against social media due to a number of reasons: the continued rise of trolling creating an ever-more toxic online environment; criticism of social media’s role in the dissemination of fake news; the growing concern over social media “filter bubbles” and “echo chambers”; and worries about the potential societal impact of social media’s algorithm-driven effectiveness in attracting and keeping a grip on our attention. Expect to see in 2018 further efforts by social media companies to get out ahead of most if not all of these issues, in the hopes of winning over critics and discouraging greater governmental regulation.
Regarding the DMCA Safe Harbor for Hosting of User-Generated Content
The backlash against social media noted in my prior item may also be reflected to some extent in several 2017 court decisions regarding the DMCA safe harbor shielding website operators and other online service providers from copyright damages in connection with user-generated content (and perhaps in the CDA Section 230 case law discussed by Aaron Rubin below). After nearly two decades of court decisions generally taking an ever more expansive approach to this particular DMCA safe harbor, the pendulum begun to swing in the other direction in 2016, and this trend picked up steam in 2017, culminating in the Ninth Circuit’s Mavrix decision, which found an social media platform provider’s use of volunteer curators to review user posts to deprive the provider of DMCA safe harbor protection. Expect to see the pendulum continue to swing in favor of copyright owners in DMCA safe harbor decisions over the coming year.
Regarding Smart Contracts
Expect to see broader, mainstream adoption of “smart contracts,” especially in the B2B context—and perhaps litigation over smart contracts in 2019 . . . .
From Aaron Rubin, Co-Editor, Socially Aware, and Partner at Morrison & Foerster:
Regarding the CDA Section 230 Safe Harbor
We noted previously that 2016 was a particularly rough year for Section 230 of the Communications Decency Act and the immunity that the statute provides website operators against liability arising from third-party or user-generated content. Now that 2017 is in the rear view mirror, Section 230 is still standing but its future remains imperiled. We have seen evidence of Section 230’s resiliency in recent cases where courts rejected plaintiffs’ creative attempts to find chinks in the immunity’s armor by arguing, for example, that websites lose immunity when they use data analytics to direct users to content, or when they fail to warn users of potential dangers, or when they share ad revenue with content developers. Nonetheless, it is clear that the knives are still out for Section 230, including in Congress, where a number of bills are under consideration that would significantly limit the safe harbor in the name of combatting sex trafficking. I predict that 2018 will only see these efforts to rein in Section 230 increase. …
Continue Reading 2018: Predictions From Socially Aware’s Editors and Contributors
With much fanfare, the Federal Trade Commission (FTC) continues to take actions relating to so-called “social media influencers” who allegedly fail to disclose material connections to the products or brands they endorse. Recurring enforcement actions and guidance—and the FTC’s ongoing promotion of its own efforts, such as through Twitter chats—make it clear that the FTC believes that its message has still not been heard by all of the players in this advertising ecosystem, including influencers themselves.
In short, any endorsements in any medium where the endorser has a material connection of any kind to the endorsed advertiser must be disclosed.
The most recent developments include an enforcement action against a company—and two of its officers—in connection with endorsements of the company made by the officers in YouTube videos and in social media. Before turning to this case, however, we provide a brief overview of how the FTC has gotten here. …
Continue Reading Brands Beware: FTC Continues Campaign on Social Media Influencer Disclosures
In 2016, brands spent $570 million on social influencer endorsements on Instagram alone. This recode article takes a looks at how much influencers with certain followings can command, and whether they’re worth the investment.
And don’t overlook the legal issues associated with the use of social media influencers; the FTC just settled its first…
Instagram is now allowing a limited number of users to identify branded content with a “paid partnership” subhead instead of using hashtags like #ad and #sponsored to identify sponsored posts. The platform says it plans to police paid sponsors’ disclosure obligations eventually, but—for now—educating and gathering feedback from Instagram’s community and launch partners is all…
Since YouTube resolved to give brands greater control over the kind of content that their ads appear alongside, many of the…
A nice overview of the rules on researching jurors’ social media accounts in various jurisdictions from Law.com.
The importance of appearing at the top of Google search results, especially on mobile devices, is driving retailers to spend more and more on the search engine’s product listing ads, which include not just text but…