Technology Continues to Test The Bounds of Copyright Law

The Internet is an unprecedented source of disruption. From retail services (e.g. Amazon) to media and entertainment, almost every industry has been forced to rethink its business model due to the accessibility, ubiquity and democratizing force of the Internet. Aereo was positioned to disrupt the traditional media distribution model by giving consumers greater control over what were otherwise “free” over-the-air transmissions.

The Aereo service was premised on the idea that consumers should be able to watch and record over-the-air broadcast television programming via the Internet. Major broadcast networks that owned the content made accessible through Aereo challenged the model on the grounds that Aereo was violating the exclusive “public performance” right guaranteed by the Copyright Act.

Copyright law provides copyright owners six exclusive rights. One of those rights is the exclusive right to publicly perform the copyrighted work. Because this right is a statutory construct, one must look to the statute to determine its meaning. To “perform” and to perform “publicly” means “to transmit or otherwise communicate a performance or display the work to a place … or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times.”

While many reacted by asking whether the case would stifle innovation and have a chilling effect on start-ups, this case does highlight the increasing tension between technological advances and copyright law.

From a practical standpoint, one need not be alarmed about the impact of the decision on most types of innovation. For one thing, the Court went to some lengths to craft a reasonably narrow decision, which applies only to broadcast TV retransmitted over the Internet.

As with any type of innovation, there are different types of risk. On the one hand, there is technology risk: the risk that whatever technology is necessary for some business plan simply won’t work. On the other hand, there is legal risk, highlighted by the Aereo decision: the risk that the entrepreneur’s interpretation of some act or case law won’t ultimately prevail. That’s what happened to Aereo.

As an IP lawyer, I am somewhat perplexed. It is hard for me to understand why Aereo made such a bold move. However, at least the district court agreed with Aereo’s interpretation.

Do you work with start-up companies and need a basic understanding of the various intellectual property issues that can arise?

I will be co-presenting in this online seminar that will help you:

  • understand the trademark and copyright problems your client may encounter with branding;
  • learn how to protect your client’s branding once established;
  • familiarize your practice with patents, including what they protect, timing, and strategies to prevent inadvertent loss of patent rights before filing the application;
  • understand trade secrets and the importance of non-disclosure and confidentiality agreements;
  • recognize intellectual property issues relating to technology, including open source code and the cloud;
  • establish a proactive approach toward intellectual property ownership between cofounders, employees, and vendors; understand business names, domain names, promotional issues, and website content concerns.

The program qualifies for 1.5 hours MCLE credit.

I would like to personally invite you to attend the upcoming Law Ed program titled, “Identifying Intellectual Property Issues in Start-Ups,” which I will be co-presenting via live webcast on Tuesday, May 27th.

Presented by the ISBA Business Advice and Financial Planning Section

Co-Sponsored by the ISBA Intellectual Property Section

A presentation on what goes into creating original designs and how these differ from copycats.

WHERE: Decoration & Design Building, J. Robert Scott Showroom, Suite 220

WHEN: Wednesday, October 2,2013 !2 p.m.

WHAT: From film to fashion, creative industries are taking steps to protect and promote original work. Designers and manufacturers need to know what steps they can take to protect their designs, their businesses, and their profits. The discussion will address issues related to how to protect original design (copyright & design patent) and the manufacturers (trademark, unfair competition).

WHO:

INTERIORS Magazine Editorial Director Michael Wollaeger

J. Robert Scott Founder Sally Sirkin Lewis

Designer Laura Kirar [Web Site]

Intellectual Property lawyer David Adler

Showroom reception to follow.

 

Download the full Fall Decoration & Design Building Market Brochure Here.

Norway a Hard Place for Tech Startups
Wall Street Journal (blog)
And there are other reasons why Norway is inhospitable to tech startups, according to Lasse Andresen, the chief technology officer of ForgeRock, an online identity management company that shifted its headquarters from Norway to San Francisco last year.

South Korea to launch new stock market to support fund-raising for startups
Washington Post
SEOUL, South Korea — South Korea’s bourse operator says it is opening a new stock market to help startups raise money. Korea Exchange Vice Chairman Choi Hong-sik said Friday the July launch of the KONEX market is intended to incubate small businesses.

Galvanize, Denver Startup Week Win Plaudits from Denver’s Old Guard
Xconomy
Galvanize, the coworking space that’s quickly become the hub for Denver’s top tech startups, and Denver Startup Week both received awards from the Downtown Denver Partnership, one of Colorado’s largest economic vitality groups.

Online education startup EduKart raises $500K in seed funding
VC Circle
The startup was founded by Ishan Gupta (CEO) and Mayank Gupta (COO) (they are not related) in 2011. Ishan had earlier worked with companies like One97 Mobility Fund, Facebook, Helion Venture Partners, Quantum Hi-Tech and Appin Knowledge.

Canada Startup of the Week – Brightsquid
Calgary Herald
Lloyed Lobo covers Calgary’s tech startup community. He is a Partner at Boast Capital and the VP of Community Evangelism at Startup Calgary. If you are working on something that could potentially change the world, we’d like to hear about it.

Life in a chocolate factory versus life in a startup
Boing Boing
Elaine Wherry took a break from working in San Francisco high-tech startups to work at Dandelion Chocolate, the chocolate maker/cafe that her husband co-founded. She calls her tenure at the chocolate factory her life as “an Oompa Loompa.”

Incubator NEST Investments Wants To Help Hong Kong’s Fledgling Startup Industry
TechCrunch
Though Hong Kong is one of the world’s leading financial hubs, its startup industry is still embryonic. Incubator NEST Investments hopes to change that by helping tech companies take advantage of the region’s wealth and resources as they work toward entering the mainland Chinese market.

Canadian Tech Startups More Focused on Revenue than a Big Exit

Techvibes (blog)
According to a PwC report released last week, fewer Canadian tech startups are looking for buyers in order to exit the market, choosing instead to find ways to reach their next growth stage and generate revenue in Canada.

Ben Franklin Technology Partners helps startups arrive.

Lehigh Valley Business
CyOptics, once a startup that received funding and help from Ben Franklin, is just one success story, according to Laura S. Eppler, director of marketing for Ben Franklin Northeastern Pennsylvania.

7 startup lessons from the film industry

Ventureburn
At first glance you might not think there is much in common between the film industry and tech startups. I’m here to tell you differently. Both industries have their own set of challenges, whether you’re starting out, or refining your craft/company.

Database Startup Clustrix Builds Up its Bankroll

Wall Street Journal (blog)
Tech watchers once considered the database market pretty stagnant, at least in terms of new technology and new entrants. Suddenly it is anything but that, with Clustrix a prime example.

1871 anniversary spotlights Chicago startup growth

Techli
Leaders of the Chicago startup community released figures Friday regarding the city’s start-up growth coinciding with the first anniversary of 1871, one of the city’s start-up incubators. “Over the last year, the tech community has really come together.

Biz Stone’s new mystery startup Jelly nabs ex-Twitter veteran Kevin Thau

The Next Web
Rumors about the move have been circulating since late last month and follows the announcement that Ben Finkel is also involved at Jelly as Christopher Isaac “Biz” Stone’s fellow co-founder and Chief Technology Officer.

A start-up’s cool solution to manage heat – The Business Times

Business Times (subscription)
Thermal management solutions for lithium-ion batteries are also exactly what Gcorelab, a local clean tech startup, specialises in. Gcorelab is developing what it calls a “small liquid-based thermal management system” for electric vehicles.

Bowei Gai: A Worldwide Crusade to Connect the Global Startup Community

Tech in Asia
Gai When you’ve been co-founder and CEO of Snapture Labs, held the same titles at CardMunch, Inc. and are currently founder and chief ambassador at World Startup Report, you tend to attract attention when you enter the tech and startup community.

Tech Startup Develops Two-Click Checkout. – Yahoo! Finance

Finance: ALBUQUERQUE, N.M., May 2, 2013 /PRNewswire/ — Tech start-up @ Pay released its first public Application Programming Interface (API) today.

Silicon Valley based high tech start up in the Golf business, developing a cool product, is looking to expand its team in different disciplines including R&D.

Image representing CloudFlare as depicted in C...

Image via CrunchBase

I just returned from RSAConference 2013 where I had the privilege and honor of giving a presentation of the legal risks caused by social media in the workplace. As a speaker-attendee, I had the priceless benefit of access to all the other speakers and programs held during the conference.

One such program I attended was “We Were Hacked: Here’s What You Should Know”. The speakers, Matthew Prince (@eastdakota) CEO of CloudFlare, and Mat Honan (@mat) writer for Wired Magazine, shared their common experience as targets of high profile hacks. Hearing the details from them first hand, including information from interviews with the hackers themselves, I learned how easy it is to be the victim of hacking and how it’s the little things that create exploitable seams in our information security barriers.

Rather than rewrite their stories, I thought I would share three simple lessons I learned that I’ve already implemented and you should too. Besides, Matt does a better job telling his own story which can be found here.

Here are the three things I learned about how you can protect yourself and others in your organization.

First, security attacks go after the “low hanging fruit” and that often means figuring out a way to exploit your personal email address. With so many web-based services and so much login information to remember, many of us use our personal email as our username for everything from the web sites on which we comment, to our online photo gallery, to our online banking service. Unfortunately, this is probably the address we use for password recovery if we forget. Given that our digital lives are easily mapped, hackers already have one piece of the two-piece login puzzle: they know your user name.

TIP NO. 1: Use a private, obscure email address for your more sensitive information.

Second, once a hacker has accessed your accounts, your computer and your files, the fun has just begun for them. As Matt Honan described, these often adolescent script kiddies simply don’t understand the value of your stored memories and other information. In his case, all the photos of his children were permanently deleted. Regardless of a hacker attack, stuff happens and you don’t want to lose everything because you we’re too lazy to back up.

TIP NO. 2: Back Up your digital life, early and often.

Third, today’s’ Internet is an interdependent ecosystem. Just because you or your organization takes security seriously, doesn’t mean that other do as well. Your internal systems are not enough. Like it or not, the seams of your security perimeter are intertwined and permeated by the services and systems of customers and vendors. For most consumers, the there is a Hobbesian choice of Security v. Convenience. Multiple login usernames and super long passwords are difficult to remember and tedious to use. As a result, most people choose the least secure means of authentication on the assumption that using astringent password is enough. Unfortunately, some people don’t even bothers with that. A recent ZoneAlarm study found that “password” was the fourth most commonly used password by consumers.

Google, Facebook and others have started using two-factor authentication. Two-factor authentication requires that one enter a code after entering the username/password combo. The code is sent via, text message, voice call or email. This greatly reduces the chances of unauthorized access because hackers would need to have your phone, in addition to your username/password combo.

TIP NO. 3: Whenever possible enable two-factor authentication.

Please understand that there is no “magic bullet” when it comes to Cybersecurity. Taking these precautions does not guarantee that you won’t be attached or that your account information won’t be accessed. However, these are important and easy steps that you can take to improve your personal data security.

Please comment and follow!

 

Entertainment Law News & Events

Entertainment Law Initiative Luncheon Set For Feb. 8 | GRAMMY.com
The GRAMMY Foundation announced today that the keynote discussion at the 15th Annual Entertainment Law Initiative Luncheon & Scholarship Presentation

Colorado IP and entertainment lawyer David Ratner forms ‘Creative …
‘Creative Law Network,’ a Denver-based law firm, will focus on small to mid-size businesses and artists.

Florida Bar Hosts Entertainment Law Event | Billboard
NEW YORK–The Florida Bar Assn.’s Entertainment Arts and Sports Law Section will host its sixth annual legal symposium on music, film and TV on March 26.

UNH Law to debut sports and entertainment law institute
Concord Monitor
The University of New Hampshire’s School of Law will open a Sports and Entertainment Law Institute next fall, giving students the opportunity to focus their studies for a law career in either field.

Entertainment lawyer Mike Novak dies
The Macomb Daily
For nearly three decades, Mike Novak’s name was synonymous with entertainment in the Detroit area. During his career the Troy-based attorney, a resident of Grosse Pointe Shores, represented the likes of artists such as Bob Seger and Kid Rock.

Use a Law Degree to Enter Environmental or Entertainment Fields
U.S. News & World Report (blog)
If you have a question about law school, E-mail me for a chance to be featured next month. This week, I will address questions from readers about pursuing environmental and entertainment law.

Fashion Law News

Minnetonka’s Trademark Suit Against Target Tip-Toes Away http://t.co/sF6vtszP via @FemmeLegale

VIDEO: First Ever Northern California Fashion Law Panel Produced …
First Ever Northern California Fashion Law Panel

Following the Dress Code: Fundamentals of Fashion Law with BK
February 13th – 6:00-8:00pm 2 MCLE Credits (Professional Practice) 123 Remsen Street, BrooklyModerator: Allegra Selvaggio, Esq.

About The Author

David M. Adler, Esq. is a 2012 Illinois SuperLawyer, author, educator, entrepreneur and partner with Leavens, Strand, Glover & Adler, LLC, a boutique law firm in Chicago, Illinois created with a specific mission: provide businesses with a competitive advantage by enabling them to leverage their intangible assets and creative content in order to drive innovation and increase overall business value.

As a result of the rapid shift in marketing from unilateral one-to-many communications, to the multilateral, many-to-many or many-to-one conversations enabled by Social Media, employees and employers are struggling to manage accounts that are used for both work and personal purposes.

This new phenomenon has benefits, but it also creates a number of legal challenges. For employees, it may result in greater efficiency, more opportunities for authentic customers engagement and the ability to stay on top of the most current grands and business issues. For employers, it presents opportunity to reap substantial benefits from lower communications and customer support costs. For in-house counsel, it raises a host of legal and practical issues with few easy solutions and significant liability and regulatory risks.

First, there are hardware issues. Smartphones, tablets and other personal electronics often have social networking capabilities built in. in addition, they contain contain both personal and business data. Because these devices are always on and always connected, they are more than just personal property. They have become essential business tools. For both sides of the workplace equation, employers and employees must understand where the privacy lines fall between personal versus work-related information.

Second, there are data issues. Employers must balance their needs to monitor employee usage, employees’ privacy concerns, and the risk of liability for theft or exposure of data if a device is lost or stolen, or from lack of proper safeguards on account usage. For in-house counsel tasked with drafting policies to address these risks, , Prior to implementation of any policy, the legal team needs to educate front line employees and management on reasonable expectations of privacy and security and the harms that the organization seeks to prevent.

Lastly, recent cases such as the Cristou v. Beatport litigation, highlight the struggle to define and control the beginning and end of employee social media accounts, ownership and protection of intellectual property and the post termination risks that arise from the absence of appropriate policies.

As we prepare to start a new year, the time is ripe to establish security and privacy policies governing creation, maintenance and use of employees’ social media accounts for work functions. In-house counsel must lead the charge to educate, inform and train employees about privacy, security and evidence-recovery implications associated with use of social media.

Company Sanctioned for ” History Sniffing”

FTC Settlement Puts an End to “History Sniffing” by Online Advertising Network Charged With Deceptively Gathering Data on Consumers

You know the old adage, the Internet is forever. Well, so is your browsing history, apparently. On December 5, 2012, the FTC announced that an online advertising company agreed to settle Federal Trade Commission charges that it used “history sniffing” to secretly and illegally gather data from millions of consumers about their interest in sensitive medical and financial issues ranging from fertility and incontinence to debt relief and personal bankruptcy.

“Consumers searching the Internet shouldn’t have to worry about whether someone is going to go sniffing through the sensitive, personal details of their browsing history without their knowledge,” said FTC Chairman Jon Leibowitz. “This type of unscrupulous behavior undermines consumers’ confidence, and we won’t tolerate it.”

The defendant, Epic Marketplace shared information with a large advertising network that has a presence on 45,000 websites. Consumers who visited any of the network’s sites received a cookie, which stored information about their online practices including sites they visited and the ads they viewed. The cookies allowed Epic to serve consumers ads targeted to their interests, a practice known as online behavioral advertising.

Mobile Applications (Apps) Continue to Threaten Childrens’ Privacy

Kids’ Data Still Collected, Shared without Parents’ Knowledge, Consent

The Federal Trade Commission issued a new staff report, “Mobile Apps for Kids: Disclosures Still Not Making the Grade,” [PDF here ] examining the privacy disclosures and practices of apps offered for children in the Google Play and Apple App stores. The report details the results of the FTC’s second survey of kids’ mobile apps.

The FTC first surveyed kids’ mobile apps in 2011. Since then there has been little progress toward giving parents the information they need to determine what data is being collected from their children, how it is being shared, or who will have access to it. Many any of the apps examined included interactive features, such as connecting to social media, and sent information from the mobile device to ad networks, analytics companies, or other third parties, without disclosing these practices to parents.

Disturbingly, the shared information included login information across multiple sites, GPs location information and device ID information.

website is down

website is down (Photo credit: Sean MacEntee)

In today’s business world, web sites are no longer simply a static online presence. Today’s web sites are highly interactive and often make use of content (photos, text, images, videos, etc.) that have bee uploaded by visitors and registered users. With the speed of search engines, social networking platforms and mobile computing technologies, any online problem can quickly have far reaching effects well beyond the initial issue.

In order to ensure that web site operators may make as broad a use of this content as possible and that these web sites do not violate the rights of those whose content has been uploaded, many web site have Terms of Use that contain intellectual property licenses, assignments and indemnifications.

A recent federal District Court in Maryland examined whether the mere act of uploading photographs to a website met the requirements of forming a valid electronic contract sufficient to assign copyrights in the photographs under Section 204(a) of the Copyright Act, which requires assignments to be in writing and signed by the assignor.

In Metro. Reg’l Info. Sys., Inc. v. Am. Home Realty Network, Inc., No. 12-cv-00954 (D. Md. Nov. 13, 2012) the defendant argued plaintiff could not state a claim for infringement on the photographs because the assignments of these photographs to plaintiff were void. Defendant argued that the web site Terms of Use Agreement (“TOU”) and the electronic process in which subscribers assigned copyrights in the photographs to plaintiff did not comply with Section 204(a) of the Copyright Act. The Court disagreed.

The Court first looked at Section 204(a). That section provides that “[a] transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.” 17 U.S.C. § 204(a). The Court then turned to the Electronic Signatures in Global and National Commerce Act (“E-SIGN”), 15 U.S.C. §§ 7001 et seq., to reject defendant’s argument that the assignments were invalid. E-SIGN provides, in relevant part:

“[n]otwithstanding any statute, regulation, or other rule of law . . . with respect to any transaction in or affecting interstate or foreign commerce–
(1) a signature, contract, or other record relating to such transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and

(2) a contract relating to such transaction may not be denied legal effect, validity, or enforceability solely because an electronic signature or electronic record was used in its formation.

15 U.S.C. § 7001(a).

“The term ‘electronic signature’ means an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.” Id. § 7006(5). The Court concluded that the  TOU was clear in its terms and that the electronic process by which  subscribers assigned the copyrights in the photographs met E-SIGN and Section 204(a) requirements. Accordingly, the Court held that the assignments were not invalid as a matter of law.

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