• Disappearing ink. Facebook is testing, for a small group of users, a feature that will permit a user to schedule a post for automatic deletion after a specified period of time. It seems that the period can range from an hour to seven days, according to people who have seen it. It is worth noting, though, that these posts can take up to 90 days to vanish from Facebook’s servers permanently.
  • Feel free to Yelp. If you have a problem with your plumber or your car rental in California, go ahead and complain online. California Gov. Jerry Brown just signed a new bill that prohibits businesses in that state from using contracts that prohibit consumers from writing negative online reviews. Some businesses include these prohibitions, known as non-disparagement clauses, in the sometimes lengthy terms and conditions that they impose on their customers. These clauses will now be illegal in most cases in California.
  • Picture this. Just because a photo appears on a social media site doesn’t mean that it is free to use, as Agence France-Presse and Getty Images found out recently when a federal court upheld a damages award against them for infringing the copyright in photos of the Haitian earthquake that had been posted on Twitter.   The court had previously held that, although the photographer had given Twitter a license to display his photos by uploading them, he didn’t give AFP or Getty the right to use them.  In the recent ruling, the court declined to set aside the jury’s $1.5 million damages award against the defendants.
  • Lawsuit panned by Court. The popular ratings app Yelp has been cleared by a federal appeals court of allegations in a class action lawsuit that the company extorted advertising dollars from businesses by threatening to remove positive user reviews or to highlight negative ones. The U.S. Court of Appeals for the 9th Circuit, affirming a District Court ruling, found that the plaintiffs failed to present sufficient evidence that any such coercion had occurred. Yelp says it has never altered a business review for money. The appeals court said that, in any case, the conduct alleged by plaintiffs amounted only to “hard bargaining,” not to extortion under federal law.
  • Shuttered images. Not long ago, Twitpic was the best-established third-party image-sharing service on Twitter. But Twitpic just announced that it is shutting down in the wake of a drawn-out trademark battle with Twitter. Twitpic’s founder said that Twitter threatened to cut off Twitpic’s access to its application programming interface, or API, if Twitpic did not abandon its trademark. The API involves the software tools that allow developers to tap into Twitter’s platform. Twitter responded that while Twitpic could use that name, “we have to protect our brand, and that includes trademarks tied to the brand.”
  • Drinking and posting don’t mix. In St. Joseph, Missouri, the local police have informed bar owners that, under state law, not only are they prohibited from sponsoring “all-you-can-drink” specials, but they cannot advertise on social media the prices associated with drink specials. The police take the position that the applicable state law, which reportedly restricts the advertising via traditional media of the exact prices of drink specials, applies to social media as well. The bar owners have objected, and the St. Joseph city attorney is seeking clarification from the state as to the scope of the statute.

Although common law generally holds publishers responsible for the content that they publish, the Communications Decency Act (“CDA”) gives website operators broad protection from liability for content posted by users.  Courts have applied the CDA in favor of website owners in nearly 200 cases, including cases involving Google, Facebook, MySpace, and even bloggers for content posted by their co-bloggers.  Commentators hail the CDA as the legal framework that made possible the rise of social media.  CDA immunity, however, is not limitless.  For example, as the Ninth Circuit explained in Fair Housing Council  of San Fernando Valley v. Roommates.com, where “a website helps to develop unlawful content,” it loses CDA immunity “if it contributes materially to the alleged illegality of the conduct.”  Two recent cases illustrate how websites can lose CDA immunity as a result of contributing to offending content.

The district court in Levitt v. Yelp considered business owners’ claims that Yelp manipulated Yelp pages, rankings, and reviews in an extortionate manner that violated California’s unfair business practices law.  Plaintiffs alleged that Yelp threatened to, and did, take down positive reviews if plaintiffs did not buy ads, and that Yelp’s salespeople manipulated rankings on Yelp.  The court first rejected Yelp’s jurisdictional argument that the CDA prevented the court from hearing the claims.  Second, the court held the CDA did not immunize Yelp because some of the claims focused on Yelp’s sales practices, and not merely Yelp’s editing or selective display of user reviews.  The court dismissed the plaintiffs’ claims anyway— finding that they had not pleaded sufficient facts to show extortion by Yelp—but it gave the plaintiffs leave to amend.

In Hill v. StubHub a North Carolina state court considered claims that StubHub violated state anti-scalping statutes.  The court rejected StubHub’s CDA defense because StubHub’s service suggested that users input particular prices for Miley Cyrus concert tickets, and profited when they did.  That StubHub suggested the illegal prices, monitored its inventory for particular events, and only made money if sufficient tickets were sold, and even then made a percentage of the ticket price, all meant StubHub “developed” the unlawful content:  a system where users scalped tickets.  The court explained that StubHub “encouraged, materially contributed to, and made aggressive use” of the pricing content posted by users, so StubHub could not avoid liability for it.

Together, the Yelp and StubHub cases show that CDA immunity, although critical for social media operators’ use of user-generated content, is not boundless.  Sites can lose CDA immunity by directing or contributing to offending content or as a result of the actions of their salespeople.

Consumers often turn to the Internet for reviews before purchasing products or services, and companies are increasingly interested in ensuring that such reviews reflect positively and accurately on their businesses.  When patients post negative or allegedly inaccurate reviews about their doctors on the Internet, however, doctors are often prevented from responding due to ethical obligations such as patient confidentiality.  Moreover, even if such reviews were to constitute defamation, under U.S. law, Section 230 of the Communications Decency Act (“CDA”) would prevent doctors from holding the website operators liable for hosting defamatory statements posted by others, such as reviews posted by site visitors.  Doctors would thus be left with the undesirable option of pursuing action against the patients directly, which often involves additional legal proceedings to determine the authors of anonymous reviews.  As a way to obtain greater control under such circumstances, an organization known as Medical Justice has created controversy by recommending that doctors require patients to sign contracts limiting their rights to publish reviews.

Over time, these contracts have reflected different approaches.  In an earlier version, the patient agreed to “refrain from directly or indirectly publishing or airing commentary regarding Physician and his practice, expertise and/or treatment.” The doctor would presumably be able to seek an injunction against the patient for breaches of the contract, such as the publication of reviews.  The patient’s agreement to such restrictions was described as consideration for the doctor’s treatment and for the doctor’s agreement not to exploit “legal privacy loopholes” that the contract claimed would otherwise be permissible under federal privacy law.

While this initial approach would have imposed liability on the patient for publishing reviews, it would still have allowed websites to continue hosting such reviews under the protection of Section 230 of the CDA.  More recent contracts—possibly revised in response to this problem—do not directly restrain patients from posting reviews, but instead require the patient to prospectively assign to the doctor the copyright in any such reviews.  “[I]f Patient prepares such commentary for publication on web pages, blogs, and/or mass correspondence about Physician, the Patient exclusively assigns all Intellectual Property rights, including copyrights . . . ” to the physician.  If valid, such an assignment would allow doctors to send “take-down” notices under the Digital Millennium Copyright Act (“DMCA”) to websites hosting the patient reviews, thus requiring such websites to remove such reviews or face liability for copyright infringement.  Section 230 of the CDA would not protect websites that receive such DMCA take-down notices, because Section 230 expressly does not provide any defense to infringement of copyright or other intellectual property rights.

As a novel use of copyright law, the Medical Justice approach may raise more problems for doctors than it solves.  The website DoctoredReviews has identified several issues facing doctors who wish to enforce such contracts against patients or to serve take-down notices to websites hosting patient reviews.  For example, such contracts may be unconscionable under state law and thus unenforceable, given the nature of the terms and the superior bargaining power of the doctor.  Doctors may even face liability for attempting to exercise their rights under the DMCA.  For example, if a doctor knows that he has not actually received a copyright assignment from the author of the review, then the doctor is potentially liable under the DMCA for submitting a take-down notice based on misrepresented information.  Because many reviews are published anonymously, some doctors require all patients to sign the contracts, in hopes of establishing that any patient publishing a review must necessarily have assigned the copyright to the doctor.  Even if a doctor does hold copyright assignments from all of her patients, the doctor may still know or suspect that a review had been fictitiously authored by a non-patient, who would not have signed any agreement.  The publication of patient reviews may also constitute noninfringing fair use, and at least one court has found that copyright owners must consider whether fair use applies before sending DMCA take-down notices.

In addition to potential liability under the DMCA, doctors may face problems arising from the legal consideration that they offer to patients in exchange for the copyright assignments.  In certain instances, the U.S. Department of Health & Human Services has prohibited doctors from representing that a patient’s agreement is in consideration for “providing greater privacy protection than required by law” when the law does, in fact, require such greater privacy protection.  Beyond the legal issues, the use of such contracts may also violate a doctor’s ethical obligation to put the patient’s interests before the doctor’s own financial interests.

Other industries have also explored the use of prospective copyright assignments, although with different— and less ambitious—approaches than Medical Justice recommends.  The Burning Man festival, for example obtains a joint ownership interest, together with attendees, in the copyright to any photographs taken at the event.  Attendees also agree to make only “personal use” of such photographs.  The agreement clarifies that, with respect to social networks, a use is only deemed “personal” if the attendee does not upload the images “with the intent to publicly display them beyond one’s immediate network, and if one’s immediate network is not inordinately large.”  The festival’s representatives have stated that these terms are intended to protect the event from commercialization, and to protect the privacy of the attendees.  In another example, the pop singer Lady Gaga reportedly requires a copyright assignment of photographs taken at concerts as a condition to obtaining press credentials.  The photographers receive a limited license to use the photographs in connection with a specific website for a four-month period.

As user-generated review websites such as Yelp continue to grow in popularity, one can anticipate increasingly clever uses of intellectual property law by businesses intent on exercising greater control over their online personae.  Yet, as the Medical Justice situation shows, too clever by half may not be clever enough.  In the end, while social media may provide a company with the world’s largest, most cost-effective platform for promoting its goods and services, that same platform is also available to the company’s detractors.

10 Million Monsters!
Marking a truly historic social media milestone, Lady Gaga became the first Twitter user with more than 10 million followers.  According to reports, the entertainer noted this achievement with a Tweet saying “10MillionMonsters!  I’m speechless, we did it!  Its an illness how I love you.  Leaving London smiling.”

Netflix Traffic
Reports are that Netflix is now the single largest source of downstream Internet traffic, accounting for more than 20% of such traffic during peak times.  In comparison, YouTube accounts for approximately 10% of downstream traffic.

Google’s Contribution to Economic Activity
According to Google, the search giant’s programs, including AdWords and AdSense, provided $64 billion in economic activity for American companies and non -profits in 2010.  This represents an 15% increase over 2009.  Google’s home state of California is said to have benefitted the most—to the tune of $15 billion.

Facebook.com’s Integration with Microsoft’s Bing
The integration of the Facebook.com site with Microsoft’s Bing search engine, first announced in 2010, has been expanded.  Among other features, Bing will now display more data regarding search results that your Facebook friends have liked and a greater ability to share Bing search results with Facebook friends.

Facebook’s New Photo-Tagging Feature
On a somewhat related note, Facebook announced a new photo-tagging feature that allows users to tag businesses, brands, celebrities and musicians that have their own Facebook pages.  Previously, users could only tag themselves and their friends in photos.

Facebook Planting Negative Stories About Google?
Many have noted that the Facebook/ Bing integration presents a challenge to Google’s own search and social networking efforts.  In another indication of the increasingly heated competition between the Internet giants, controversy arose over allegations that Facebook hired a public relations firm to plant negative stories about Google.

Bin Laden’s Death Sets Twitter Records
Osama Bin Laden’s death set new Twitter records, becoming one of the most tweeted events ever.  According to Mashable, Twitter reached more than 5,000 Tweets per second at the beginning and end of President Obama’s speech announcing Bin Laden’s death, with a total of 27,900, 000 Tweets over a period of about two and a half hours.

Facebook Class Action
A Brooklyn man has filed a class action lawsuit against Facebook, alleging that the company’s “social ads”—which display the names and images of a user’s friends who have liked a particular brand or ad—use minors’ names and likenesses without the parental consent required under a section of New York’s civil rights law.

Social Widgets as Data Tools
“Social widgets,” those ubiquitous website buttons that allow users to “like” or “share” online articles and other content, also let their makers collect data about the websites people are visiting, potentially raising privacy concerns, according to a study prepared for The Wall Street Journal.

Google News Archive No More?
It has been reported that Google has ceased adding content to its Google News Archives, which provide free access to scanned archives of newspapers.  The existing archive remains accessible, however.

Social Networking for Children
Facebook’s founder, Mark Zuckerberg, announced recently that he would like to make the social networking site available to children, but also recognized the challenges presented by current law, particularly the Children’s Online Privacy Protection Act, which imposes strict rules regarding the collection of personal information from users under the age of thirteen.

Bad Yelp Reviews Barred from Anti-SLAPP Statute
A California court recently ordered a dentist who sued Yelp users for defamation over negative reviews to pay $80,000 in attorneys’ fees, after ruling that the dentist’s suit was barred by California’s anti-SLAPP statute.

Facebook and the ADA
A recent Ninth Circuit decision held that Facebook was not liable under the Americans with Disabilities Act when it terminated a user with bipolar disorder for terms of service violations because Facebook’s services do not have a nexus to a physical place of public accommodation that would be necessary to subject it to the ADA.

Morgan Stanley Employees on Twitter
Morgan Stanley Smith Barney has reportedly become the first major brokerage firm to allow its brokers to use Twitter.

“SB 242” Rejected
California’s Senate has rejected a bill (“SB 242”) that would require social networking sites to hide personal information about users unless they give their permission to share it.  A coalition of Web companies, including Facebook, Google, Skype, Twitter and Yahoo, had voiced opposition to the bill, arguing in a letter to Senator Ellen Corbett (D., San Leandro), who proposed SB 242, that the proposed statute “gratuitously singles out social networking sites without demonstration of any harm,” and would result in users making uninformed choices by requiring that they select privacy settings ahead of using the sites.