California Business Litigation Blog

Although Twitter may have started out as a social networking tool, more and more businesses are using it as a marketing tool. A lot of people have Twitter accounts that they think of as a tool to promote their own careers. Sometimes, in the process of promoting their careers, they may do a little cross-promotion for their employer. After all, if it’s good for the company, it’s good for the employee, usually. “A rising tide lifts all boats,” to quote John F. Kennedy. But if you use your Twitter account to promote your company as well as yourself, then who owns the account?

A current legal case filed with the US District Court in the Northern District of California involving a private individual who used his Twitter account to boost his employer seeks to answer this question. PhoneDog, a mobile products website, is suing its former employee, Noah Kravitz, for $340,000.

PhoneDog says that Kravitz was “given use of” a Twitter account while he worked there, and that he continued to use the account after he left the firm, constituting theft of trade secrets and damage to the PhoneDog’s “business, goodwill, and reputation.”

PhoneDog says that the Twitter account @PhoneDog_Noah was used by Kravitz to “disseminate information and promote PhoneDog's services on behalf of PhoneDog." Kravitz counters that he created the account, linked it to his email address and used it to tweet the things that mattered to him personally, including tweets related to his career and PhoneDog, as well as sports and food, among other subjects.

In fact, says Kravitz, the account wouldn’t work as well if it didn’t combine both personal and career elements. "It's this melding of personal and professional which is why I've gained a modest following," he said in an interview, "Because it's not just the dry headline and link to something."

PhoneDog claims in the lawsuit that it asked Kravitz to drop the account when he left the company. Instead, it claims, he kept the account but changed the handle. Kravitz tells a different story. He says PhoneDog didn’t ask any such thing. Instead, he says, it gave him a green light to keep using the account and even to mention the company. "At no point until July of this year, a good 8 months after we parted ways, did they ask for the twitter account or claim in was their property."

In the lawsuit, PhoneDog claims that Kravitz’ post-employment use of the account is an attempt “…to discredit PhoneDog and destroy the confidence that PhoneDog's users have in PhoneDog."

According to Henry J. Cittone, an intellectual property attorney, the crucial question is going to be whether Kravitz was paid to create the account and to send Tweets. “They said they hired him to create this feed for them. That is the way the company could dislodge a Twitter feed from its owner."

Continue reading "Who Owns Your Twitter Account?" »

According to a study conducted by Plymouth University, teachers in the UK are increasingly becoming the target of cyber bullying at the hands of students and parents. Andy Phippen, who authored the study, questioned nearly 400 teachers earlier this year about their experiences with cyber bullying. He discovered that 35 percent of the teachers in his sample said that they or a colleague had been the victim of cyber bullying perpetrated by students or their parents.

In an interview, Phippen stated, “Everyone acknowledges this is a problem and something needs to be done about it, but schools lack support. It is a sticky area as some of the things posted may not be considered illegal." Furthermore, British schools have not shown much support for teachers who have been targeted. "I heard of one case where a teacher told his employers about the bullying and not only did they tell other members to staff to ignore this teacher, they also suspended him. Their reasoning was ‘there is no smoke without fire’.”

The study's participants reported incidents of cyber bullying ranging from Facebook postings to abusive Tweets. Phippen was particularly disturbed to discover that 26 percent of the bullying was actually committed by parents. One educator who participated in the study had what she called a "mini breakdown" after a year-long campaign of abuse by a parent. “The parental statistics were particularly surprising," said Phippen. "Schools are definitely playing down the severity of the issue, whether it’s because they just don’t realize, or because they don’t know how to deal with it.”

Phippen wants to change that and thinks Britain needs a nationwide support network to address the problem. Although I am not aware of any similar study in the US, it's (unfortunately) a safe bet that it's happening here. In recent years American courts have heard several cases in which students were suing over punishments meted out by schools for mocking or insulting posts made outside of school.

A federal appeals court has refused to order the reinstatement of a student suspended for cyber bullying. Kara Kowalski was a senior at Musselman High School in West Virginia when she launched her vicious attack against a classmate. Kara’s weapon of destruction was a personalized MySpace page entitled “S.A.S.H.”

At subsequent court hearings, Kara stated that S.A.S.H was an acronym for “Students Against Sluts Herpes.” She went on to allege that another student started a false rumor that the title really represented “Students Against Shay’s Herpes.”

Nonetheless, numerous youth immediately posted images of Shay on S.A.S.H. All of the intentionally altered pictures suggested that Shay had a venereal disease. Shay suffered severe harassment and ostracism as a direct and proximate cause thereof.

When Shay’s parents complained to authorities about this offensive content, school administrator deemed that S.A.S.H. was indeed a “hate website.” Official school policy prohibits cyber bullying. Accordingly, Kara received a five-day disciplinary suspension.

The ensuing litigation posited that this punishment violated Kara’s constitutional rights to due process and free speech.

The court rejected those claims, however. The sole purpose of S.A.S.H. as a forum for defamatory publication and derogatory depictions seems to have been the underlying rationale.

Thus, the Fourth Circuit jurists ruled that school officials did not usurp their legal authority by suspending Kara. Judge Paul V. Neimeyer penned the majority view. In it, he opined that school officials acted appropriately by taking Kara’s callous disregard for a fellow student very seriously.

In addition to being suspended, Kara was prohibited from crowning her successor to the “Queen of Charm” throne. She also lost a cheerleading post.

Ironically, Kara also claimed to have suffered severe depression and social isolation as collateral consequences. The court was apathetic to those assertions, however.

This is a great example of school authorities doing the right thing for the right reasons.

The last paragraph of the Court’s decision says it best: “Rather than respond constructively to the school’s efforts to bring order and provide a lesson following the incident, Kowalski has rejected those efforts and sued school authorities for damages and other relief. Regretfully, she yet fails to see that such harassment and bullying is inappropriate and hurtful and that it must be taken seriously by school administrators in order to preserve an appropriate pedagogical environment. Indeed, school administrators are becoming increasingly alarmed by the phenomenon, and the events in this case are but one example of such bullying and school administrators’ efforts to contain it. Suffice it to hold here that, where such speech has a sufficient nexus with the school, the Constitution is not written to hinder school administrators’ good faith efforts to address the problem."

The entire decision may be viewed HERE.

Continue reading "Federal Appeals Court Rules Against High School Cyberbully" »

Another chapter recently opened in the Facebook lawsuit chronicle. The plot of this latest litigious episode pits the popular social media site against a large class of angry litigants.

A comprehensive research study is the apparent catalyst of controversy. Authored by Tilburg University researcher Arnold Roosendaal, the report revealed that Facebook uses its famous “Like” button to track unsuspecting web surfers’ online activity. CLICK HERE to download report.

The piece also posited that Facebook discerns member identities via cookies that are covertly installed while users visit sites that display the “Like” icon. IP addresses thereby obtained are purportedly used to track Facebook members’ online activity.

Further research disclosed that similar cookies are also installed on non-members’ computers by sites that feature the “Facebook Connect” login platform. Intercepted data is then used to track subsequent visits to participating sites.

Personal privacy is the crux of the most recent Facebook litigation. The plaintiffs (California residents Ryan Ung, Chi Cheng and Alice Rosen ) assert that Facebook violated the reasonable expectation of privacy in one’s personal web-browsing history.

Another Facebook lawsuit was recently dismissed with leave to refile. The suit alleged that Facebook surreptitiously transmitted users’ personal data to online marketers via embedded header codes. Virtual advertisers obtained Facebook users’ names, ages, gender, and other personal data without prior user consent. This practice was in clear violation of Facebook’s stated privacy rules.

Yet another case in the long line of social media lawsuits against Facebook is on appeal to the Ninth Circuit. The Plaintiff-appellants are protesting a Facebook lawsuit settlement stemming from Facebook’s unauthorized dissemination of members’ e-commerce transactions.

According to the Wall Street Journal, Twitter and Google also admit to tracking web users’ surfing activities without the prior activation of a widget or icon. Google and Facebook both claimed to “anonymize” such compiled data, however.

Such assertions are akin to a former President’s admission of having smoked marijuana without inhaling. Why would social network sites expend considerable resources to furtively capture personal identifying data - to accomplishing nothing except its nullification by “anonymization?“

The online community must actively oppose practices that compromise personal security through pervasive invasions of individual privacy. Given the overall litigious climate in contemporary American society, social media lawsuits may be the most effective ammunition in the battle against Big Brother.

Indisputably, the internet’s vast commercial and informational capabilities serve many beneficial functions. Effective checks and balances are essential, however. Moderation is the best means of maintaining the best balance between personal and pecuniary freedoms.

Continue reading "Facebook Lawsuit Forces Fans to Face the Facts " »

Of late, fifteen-year-old Phoebe Prince has been an American media icon. The Massachusetts high school student recently committed suicide following a relentless campaign of malicious bullying by ruthless classmates. Her story has served to prompt parents and other concerned parties to ponder the prevention of similar future teen tragedies.

Overall public response has been a veritable rush on government. In response, Massachusetts legislators hurriedly enacted anti-bullying statutes. The new law designates the fourth Wednesday in each January as “No Name-Calling Day” in the Commonwealth.

Touted as the most comprehensive anti-bullying statute in the entire nation, the law goes much further than mere establishment of establishing an official day of anti-bullying observance. It also mandates annual training and mandatory harassment reporting by school personnel.

A prominent query currently on many minds is the likelihood of the law having any real long-term positive impact. Unfortunately, any affect will probably be minimal.

Local authorities made further attempts to deter future bully malfeasance by initiating criminal prosecution against Phoebe’s tormentors. Their sentences to community service with probation led to widespread outrage in many circles. A perceived failure of the criminal justice system was the primary cause of such vehement criticism.

Other commentators have proposed civil suits as the best antidote to the alarming recent rise in harmful teen taunting. Attorney Wendy Murphy publicly promoted federal civil rights litigation by Phoebe’s parents against the school district. Murphy suggested this approach as a strong economic incentive for education officials’ strict adherence to anti-bullying laws..

The sad fact is that virtually every facet of modern society is saturated with bully ented propaganda. From political candidates’ derogatory public statements to primetime television airings right beneath our own roofs, the problem is pervasive.

Sadly, Phoebe’s story is reminiscent of an ancient anecdote about a busy father, his young son, and a magazine. To keep his son sufficiently distracted while he worked, the man tears the page into dozens of pieces and instructs the boy to reassemble them. One side of the page featured a man’s face while the other displayed a globe.

Within moments, the boy returned with the reconstructed picture. When asked how he had accomplished the task so quickly, the child responded that it was easy. It seems that once the man was back together, the whole world also fell right into sync.

Likewise, the most effective anti-bullying approach starts with wholesome adult who examples. Exhibiting courtesy and respect in all interpersonal interactions is the permanent best cure. In the long run, it portends much more effectiveness than mere “Band-aid” solutions of lawsuits and legislation.

In February and March we posted about the webcam spying lawsuits filed against the Lower Merion (PA) School District. In an effort to move on with the business of education, the school district settled the lawsuits for $610,000.

Blake Robbins, filed a lawsuit in February claiming that the school district used then 15, charged in an explosive civil-rights lawsuit filed in February that the district used its remote tracking technology to spy on him inside his home. Evidence uncovered in the case showed that he was photographed 400 times, sometimes as he slept.

A second student, Jalil Hassan also filed suit.

Federal prosecutors investigated whether the district broke any criminal wiretap laws, but declined to bring any charges.

The terms of the settlement require $175,000 to be placed in a trust for Robbins and $10,000 for the second student Hassan. Additionally, their lawyer will get $425,000 for his work on the case.

The district's insurance carrier, Graphic Arts Mutual Insurance Company has agreed to pay $1.2 million on behalf of the district toward legal and settlement costs.

The district is no longer using the remote tracking program on the 2300 laptops issued to students.

Last month, the Ninth Circuit Court of Appeals ruled that an automobile broker’s use of the following five letters “Lexus” was not trademark infringement. It stated that it was actually a “lawful nominative fair use”.

Farzad and Lisa Tabari are independent, online auto brokers in Southern California who formerly used the domain names “buy-a-lexus.com” and “buyorleaselexus.com”. Toyota Motor Sales USA filed a trademark infringement lawsuit against the Tabaris. Toyota also sought an injunction to prevent use of the Lexus mark.

The District Court concluded that the brokers had infringed Toyota's mark. That court enjoined use of the Lexus mark in any domain name or metatag. The Tabaris appealed these decisions.
On appeal, the Ninth Circuit reversed the lower court’s decisions. The appellate court stated that consumers looking for a Lexus online are sophisticated enough to know an official Lexus website from the Tabaris sites. The court also affirmed that internet searchers are used to trial and error searches, and as such would not be confused.

Lacking any affirmative suggestion of affiliation or sponsorship, the Ninth Circuit reasoned, simple use of the mark in the domain name would not cause Internet users to believe there is sponsorship or affiliation with Toyota/Lexus.

Quoted from the Ninth Circuit decision, which may be viewed HERE : “The Tabaris are using the term Lexus to describe their business of brokering Lexus automobiles; when they say Lexus, they mean Lexus. We’ve long held that such use of the trademark is a fair use, namely nominative fair use. And fair use is, by definition, not infringement.”

Continue reading "Ninth Circuit Rules in Favor of Defendants' Use of Lexus Name" »

When Craig Kleffman received 11 email messages offering broadband phone services from Vonage and noticed that they came from a variety of domain names, he found a lawyer and filed a lawsuit. Kleffman felt that these emails were spam (also known as junk emails) and as such a violation of a California spam law that prohibits marketers from sending messages with misleading headers.

While the emails might be annoying, the California Supreme Court ruled this week that they were not spam, and did not violate California law.

Justice Ming W. Chin wrote on behalf of a unanimous court: "We find that a single e-mail with an accurate and traceable domain name neither contains nor is accompanied by 'misrepresented … header information' ... merely because its domain name ... is 'random,' 'varied,' 'garbled' and 'nonsensical' when viewed in conjunction with domain names used in other e-mails.”

He continued: "An e-mail with an accurate and traceable domain name, makes no affirmative representation or statement of fact that is false."

And concluded: “…we hold that, on the undisputed facts of this case, sending commercial e-mail advertisements from multiple domain names for the purpose of bypassing spam filters is not unlawful under section 17529.5(a)(2).”

The ruling (which may be viewed HERE) will likely make it more difficult for internet users to sue email marketers in California, which has an anti-spam law that is broader than the federal Can-Spam law. Generally, the federal law (which bars individuals from suing for spam violations) overrules most state spam laws. There's an exception for state laws to be used when dealing with fraud.

Continue reading "CA Supreme Court Rules in Favor of Vonage in Spam Lawsuit" »

Last month we wrote a post about a lawsuit filed in Pennsylvania alleging that school laptop computer cameras were being remotely activated while in students’ homes.

The most recent update in the case is that numerous parents in the school districts named in the lawsuit have filed documents in federal court opposing the lawsuit and asking to intervene.

Parents objecting to the lawsuit state that they are angry about the unauthorized use of webcams in students’ homes, but are more concerned about the financial impact of a class action lawsuit. Approximately 500 parents have signed a petition opposing the lawsuit which is seeking class action status.

One parent, Larry Silver, stated "We see no benefit to the school district or to the students if a large damage award is gained by the plaintiffs. We want a positive resolution to this matter. We want them (school districts) to get back to their educational mission."

Our original post is available HERE.

An extremely detailed (lengthy) account of events leading to the lawsuit is available on Philly.com.

Continue reading "UPDATE: Parents Oppose Webcam Lawsuit Against School District" »

Facebook, the social networking website has won an award of $711 million in damages. The damages awarded from Sanford Wallace who is a prolific spammer and social network scammer, reports state. The man was banned from accessing Facebook as well, as punishment for bombarding Facebook users with spam. The lawsuit, filed by Facebook in early 2009, names Wallace, Adam Arzoomanian and Scott Shaw, all accused of accessing accounts of users without permission to do so and sending spam emails and making posts to public message walls of users.

Facebook has a long list of victories over spammers, including one in 2008 for some $873 million against Adam Guerbuez and Atlantis Blue Capital. In this ruling, the three men violated the Computer Fraud and Abuse Act, the California Anti Phishing Act and the Controlling the Assault of Non Solicited Pornography and Marketing Act.

However, experts believe that Facebook will not see the judgement awarded. In fact, Wallace and his partner, Walter Rines, were fined some $230 million in May of 2008 in a case involving MySpace. In that case, the accused tricked users into providing login information through phishing scams. Then, as they accessed the accounts of users, they sent more than 730,000 messages with links to gambling, porn and ringtone websites. The two made more than half a million though their MySpace violations only.

It is unlikely that Facebook will receive much of the judgment, but that is not what Facebook is hoping for. They are using the case as a ploy to show other pro spammers what can happen to them for violating the rules. However, experts state that pro spammers already know what to expect and they do not see it as a deterrent. In fact, whenever these pros lose, they simply disappear for some time and emerge as a different entity somewhere else, rarely paying any of the fees they owe.

Ninety-Five percent of all email is spam, says Jamie De Guerre, who is chief technology officer at Cloudmark. De Guerre also stated that while the industry is doing well to fight spam, the spammers are doing well to find new ways to continue the process. The problem, and perhaps the solution, lies in the hands of consumers and legitimate organizations, who may wish to take more conservative communication efforts, such as avoiding any type of URLs in email communications. The problem is worldwide, and is even more common in other countries. In Russia, for example, even legitimate, respectable companies use spam.

Continue reading "Facebook Unlikely to Collect $711 Million Spam Award" »

Microsoft has returned virtually all Sidekick user data, including contact information and other personal data to users. Nevertheless, there are likely to be pending lawsuits filed against the company.

On Saturday, Microsoft informed users that it had lost all data and backup systems in a system wide crash. The company now says that it has restored that data, but it appeared to be weary of issuing such a message early on.

Microsoft vice president Roz Ho provided an open letter to customers of the Sidekick stating that only a small number of users are still without their personal data. However, such a warning may not be enough to keep customers. In recent conversations at T-Mobile's website, talk was about leaving the company. Users seemed to be interested in filing a class action lawsuit against Sidekick and owner Microsoft.

More so, there was evidence that some of the messages posted on the website from Sidekick users unhappy with the company were deleted or moved in some fashion after mention of the lawsuit.

The social media outlets are teaming with information. On Twitter, the micro blogging website, mention of Sidekick lawsuits was the talk of the day, including mention of several pending lawsuits in California and in Washington. One such case filed in California, was filed by a mother whose teen daughter lost photos and song lyrics in the loss of data.

Another lawsuit was filed in Atlanta, by a woman, Maureen Thompson, says that the companies she named (including T-Mobile, Microsoft and Danger the manufacturer of the device) were negligent and failed to meet advertised promises to customers. Attorney John Jablonski, speaking about the case, said that it was likely that such cases would lose merit, since the data was restored.

T-Mobile employees are not speaking of the case and claim they have no comment in regards to the online complaints from customers. The company does seem to have kept customers informed and on Monday, temporarily halted all sales of the Sidekick smartphones. In addition, the company offered affected customers one month free service from the company, plus a $100 T Mobile gift card.

It is not clear how many Sidekick users have filed or plan to file lawsuits against the company, nor how many people may still be affected by a loss of data. You may view the California lawsuit HERE, compliments of SeattlePI.com.

The American Civil Liberties Union has been called on by a school librarian and two high school students in Tennessee. The students believe that the school's blocking of lesbian, gay, bisexual and transgender (commonly called LGBT) issues is particularly troublesome because it does not allow students to gain information from both sides of issues, as well as limits their rights to obtain needed information.

In Tennessee, some 107 school districts have an Internet filtering software program that stops LGBT content from being displayed on school computers. This software, called Educational Networks of America filters content according to the settings selected by the district.

Because of the filtering, high quality and nationally established websites including the Gay and Lesbian Alliance Against Defamation, Human Rights Campaign and the Parents, Families and Friends of Lesbians and Gay's websites cannot be accessed.

Enter a school librarian named Karyn Storts Brinks from Fulton High School. She tried to improve the situation and change the rules, to no avail. The problem with the software is that it only allows students to get one side of the story even though the contents are in the public forum now. While it does not allow students to visit these websites, considered legitimate resources, it does allow for students to visit websites encouraging reparative therapy which has been labeled dangerous by the American Medical and Psychiatric Associations.

One student tried to access information for LGBT students on scholarships available. Others have used it to research current debates in the public venue. There is no law, federal or state wide that requires such a block. The state law does require the blocking of material deemed obscene or harmful to minors.

The hope is that with the aid of the American Civil Liberties Union, there will be a solution put in place to aid these students.

Cyperbullying is the act of threatening individuals in some manner through electronic means. Bullying in general is something that many students have faced over their school life and now, it has moved to the Internet. A good example of what is happening is with the website Facebook, a very popular, social network geared towards connected people.

Facebook users can create "hate groups" in which some students are using to mock, harass or otherwise harm users. This has lead to situations in which students are bullying other students not on school grounds, but through the Interent. The problem here is that there is no one group that is considered ultimately responsible for fixing this form of bullying.

The State of California passed Assembly Bill 86, which defines cyberbullying, but some believe it does not go far enough. Should police be involved in the situation, to handle these types of situations? Or, should the school be responsible? In some cases expressing cyberbullying, schools are often unable to monitor children off school grounds and yet try to stop cyberbullying anyway.

Some parents disagree with this. They do not want schools monitoring their children's computers or interacting with children outside of the classroom atmosphere. Parents themselves are often unable to monitor children close enough due to groups like Facebook, which makes it very easy for kids to come together online without their parent's knowing. Take this a step farther and some could blame social groups like Facebook, which does not have stricter requirements. Should the website stop kids from cyberbullying? They often do not realize such groups exist until it is brought to their attention, which rarely happens soon enough.

An example of this happened in California's Palo Alto school where a group of kids created a Facebook group that was called "I Hate Tyler" which was specifically targeted towards a student at Jordan Middle School. Over 100 members joined the group, which was created after the boy posted a video of himself singing on another popular site YouTube.

The question remains. Who is responsible for policing children who participate in cyberbullying?

Continue reading "Cyberbullying: Schools, Websites, and Parents Go Head To Head" »

Internet giant Google has been sued by Aaron and Christine Boring for taking photographs of their property for Google Maps Street View feature. The problem is that the photos were taken from a private road.

For those who have not yet experienced Google Street View it is a feature of Google maps that allows users to actually “visit” the street via the internet through photographs providing a 360 degree view.

Not all cities have this Google feature available yet, but the Boring’s property was included last year. The images are captured by a car similar to the one seen above with an array of cameras mounted to its roof.

Google spokesperson Larry Yu said that the company has a policy of only taking photos from public streets. He also said that concerned citizens can contact the company if they want a photo taken down. Yu added “"We absolutely respect that people may not be comfortable with some of the imagery on the site. We actually make it pretty easy for people to submit a request to us to remove the imagery."

In this case, damages may be difficult to prove since Google is not the only place on the web showing an image of the Boring’s home. The Allegheny County real estate Web site has a photo, a description of the home and the couple's name. The site contains similar information, including pictures, of nearly every property in the county.

The Smoking Gun has a copy of the photos (which are no longer on Google Streetview), a copy of the lawsuit (including the Boring’s home address) and a photo from the Allegheny County website.

Continue reading "Google Sued by the Borings for Invasion of Privacy" »

Most of us have seen the LifeLock advertisement in which company CEO Todd Davis reveals his Social Security number and then speaks about the effectiveness of the company’s protections. Experian’s lawsuit claims that LifeLock’s ads are fraudulent and misleading. Experian also claims that LifeLock’s primary means of protecting its 600,000 clients is filing a fraud alert every 90 days for each LifeLock client.

A fraud alert is a notice/flag put on your credit report through the consumer reporting agencies. This flag establishes that as part of any credit approval process, you need to be notified.

Experian claims LifeLock’s practice of filing fraud alerts on behalf of clients is illegal because, under the Fair Credit Reporting Act, “fraud alerts can only be requested by the individual consumer or an individual acting on behalf of the consumer."

Further the lawsuit claims, adding four alerts per year for 600,000 LifeLock members to Experian’s database will degrade the effectiveness of legitimate fraud alerts over time. Credit grantors could lose the ability to distinguish between fraud alerts added by consumers who legitimately believe that identity theft is imminent and those added by LifeLock. The complaint alleges that credit grantors will have reason to doubt the credibility of all fraud alerts and their effectiveness for consumers legitimately impacted by fraud and identity theft will be severely compromised.

The complaint against LifeLock was filed by Experian in the U.S. District Court for the Central District of California.

Lisa Krinsky was formerly president and CEO of SFBC International in Florida. On a financial message board hosted by Yahoo, Krinsky was the target of some very negative, crude and vulgar comments. Krinsky filed suit against 10 pseudonymous posters for libel and interference with contractual/business relationships.

The problem was that she had to identify the people she was suing. Krinsky attempted to discover the defendants’ identities by serving a subpoena on Yahoo. Yahoo notified Doe 6 that it would comply with the subpoena in 15 days unless a motion to quash or other legal objection was filed.

Doe 6 then moved in superior court to quash the subpoena on the grounds that (1) plaintiff had failed to state a claim sufficient to overcome his First Amendment rights for either defamation or interference with a contractual or business relationship, and (2) plaintiff's request for injunctive relief was an invalid prior restraint.

Santa Clara Superior Court Judge Socrates P. Manoukian concluded that the totality of circumstances justified the relief Krinsky was seeking, and denied Doe 6’s motion to quash.

Doe 6 appealed.

On appeal, Justice Franklin D. Elia wrote for the court that posters to Internet message boards had a First Amendment right to shield their identity, and that this right could only be overcome if Krinsky could make a prima facie showing that a case for defamation existed.

Directly from the opinion, which can be found HERE “We thus conclude that Doe 6's online messages, while unquestionably offensive and demeaning to plaintiff, did not constitute assertions of actual fact and therefore were not actionable under Florida's defamation law. Because plaintiff stated no viable cause of action that overcame Doe 6's First Amendment right to speak anonymously, the subpoena to discover his identity should have been quashed.”

While we in no way condone the vulgarity and crudeness used by Doe 6 (as quoted in the opinion), we commend the California Court of Appeals for protecting our free speech rights related to the Internet.

In a David v. Goliath story with a surprise ending, Transmeta and Intel have settled their mutually opposing patent infringement lawsuits. Intel will pay Transmeta a total of $250 Million; $150 Million now plus $20 Million a year for the next 5 years.

In addition to all pending lawsuits being settled, Intel will receive non exclusive rights to Transmeta’s entire patent portfolio (press release here). Transmeta gets an influx of cash and a guaranteed income for 5 years which will allow further research & development. Additionally, Transmeta can proceed without the threat of any additional patent lawsuits from Intel.

So who won? While it may be a little early to speculate, Transmeta is clearly better off than it was before the lawsuits were filed. Prior to this settlement, Transmeta’s market value was slightly over $40 Million. They have pretty much guaranteed their future for at least 5 years. In all likelihood, Intel will parlay their “investment” in Transmeta’s patent portfolio into profits which will exceed their cash outlay.

This is a textbook example of a settlement in a business lawsuit which not only stands to benefit both parties, but consumers as well.

One final note. Transmeta has 2 attorneys on it’s in house legal team while Intel’s in house legal team has over 200. I have long believed that in law, smaller is better because it allows much greater flexibility in litigation.

It’s nice to see that David won even if Goliath didn’t lose!

Continue reading "Intel and Transmeta End Patent Lawsuits With Intriguing Settlement" »

By the time you read this, there will likely be at least one more lawsuit filed against Apple and AT&T over the iPhone. While I believe that all lawyers are good and some are better, it is times like these that make me question some in the legal profession.

When lawyers take on a lawsuit where the plaintiffs are suing because the iPhone will do everything it was promised to do, but won’t allow use on other networks or with third party application software....it just ticks me off!

Good lawyers DO NOT accept meritless lawsuits!

In case you don’t know, the Apple iPhone has been sold to only work on the AT&T network. There were never any other promises in any advertising or on the website. If you visit the Apple iPhone questions and answers web page you will find the following:

Can I “unlock” iPhone and use it with another wireless carrier?
AT&T is the exclusive wireless carrier for iPhone in the United States. If you currently use another wireless carrier, you can choose to transfer your number when you activate your AT&T account.

One of the toughest aspects of my practice is meeting with people who think they have a case and telling them they don’t. Countless times during an initial consultation with a prospective client, I have to tell them honestly that they have little or no chance of coming out ahead in a lawsuit. Most people appreciate our integrity.

Knowing where you stand before signing a retainer agreement or writing a check means that both you and your lawyer have a better chance of reaching a favorable result in your legal matter. This is one of the reasons for success on our clients’ behalf.

If your iPhone won’t fly a kite or will not do anything else it was not intended to do…call someone else. But if you want an honest appraisal of your current legal issue (always at no charge), call me today at 818-461-8500.

Richard Oppenheim

PS Additional helpful information may be found in questions 5 and 6 in our resource document “Eleven Questions to Ask BEFORE Hiring a Business Attorney”. You will find it on our website Home page.

The RIAA (Record Industry Association of America) has filed an estimated 20,000 lawsuits in the last 3 years against people (many of them unnamed “John Does”) for downloading music on P2P networks. One such lawsuit was filed against siblings Michelle and Robert Santangelo who have filed a motion to add AOL and Sharman Networks/KaZaa as third party defendants.

In this legal strategy, the Santangelos are demanding approximately $3.9 million each from AOL & Sharman. Their claim is that AOL did not take any actions to block file sharing and did not warn Michelle and Robert about consequences. The revised Complaint also blames KaZaa for designing software which automatically shares downloaded files. It also alleges that both AOL and Sharman failed to pass on RIAA warnings related to the legality and consequences of file sharing.

If the Santangelos are successful other P2P defendants in RIAA suits would likely sue their internet service and file sharing network providers for damages. Further, it could lead to file sharing software providers and ISP’s changing how they handle file downloading and uploading on the internet.

The strategy of adding other parties (especially larger companies with deeper pockets) to business lawsuits has been around a long time. It requires a special set of conditions...

Continue reading "AOL & KaZaa Could be Added to RIAA v. Santangelo Lawsuit" »

We regularly receive requests to explain the process of litigation, which we always communicate (using dialog NOT monologue) to prospective clients during our initial consultation. We hope you will find our lawsuit synopsis helpful. Feel free to forward it to others and remember to contact us with any questions about any business or employment lawsuit.

The litigation process generally involves four (4) phases. The length of each phase varies with the legal and factual complexities of each case.

The initial phase takes place before anything is filed in court. The attorney meets with the client to determine the facts of the claim being advanced by the client or the client's defense to a claim brought by another. In either case, it is essential that the client meet with the attorney at the earliest opportunity as valuable rights may be lost by delay. Once the attorney meets with the client, the attorney will review any documents relevant to the matter, research the applicable law and possibly speak to witnesses in order to chart a course which is in the best interest of the client.

The next phase involves the filing of an initial pleading in court. Typically, this is the filing of a Complaint or an Answer to a Complaint. The discovery process begins, which may include serving the other side with written questions, called Interrogatories, obtaining evidence which may be in the possession of the adversary or some other party and taking depositions, the oral questioning of parties and witnesses.

Once this phase has been completed, the case is ready to be tried. A trial may be in front of a Jury or a Judge and can vary in length depending upon the number of witnesses and quantity of exhibits offered. Under our system of jurisprudence, the plaintiff has the burden of proof. The plaintiff's case goes first. The defendant then has an opportunity to respond to the plaintiff's case with witnesses and evidence to support the defense. If the defendant has brought a Cross-Complaint, it is tried in the same manner. Otherwise, the plaintiff has an opportunity to put on a rebuttal case to counter the evidence offered by the defendant and, on occasion, a defendant may offer a sur-rebuttal to reply to the evidence offered by plaintiff in the rebuttal case.

The final phase of litigation involves the post-trial matters including motions to vacate or correct the judgment, appeals and efforts to collect on the judgment.

Can a social networking site like MySpace.com prevent its users from posting links to other competing social networking websites? According to U.S. District Court Judge A. Howard Matz, it can. In his ruling Judge Matz threw out the antitrust claim against MySpace.com declaring that the social networking site isn't required to display competitors' Web page links.

According to court documents, LiveUniverse alleges that MySpace prevents users from watching vidiLife videos that they or other users previously loaded onto their MySpace webpage, deletes references to vidiLife.com on MySpace and prevents MySpace users from mentioning “vidiLife.com.”

This may be the first antitrust case to address whether a social networking site can prevent its users from posting certain links. Representing MySpace, attorney Richard Stone stated ”MySpace doesn't prevent anyone from going to their competitors' sites, but, we have no responsibility to build a moving walkway to a competitor's store." Stone continued “And by including those links, MySpace would be risking exposure if sites such as vidiLife had any inappropriate content. “

LiveUniverse, owner of vidiLife.com was founded by Brad Greenspan. Mr. Greenspan was the founder eUniverse the company that created MySpace.com which was sold to Rupert Murdoch’s News Corp for $580 Million. According to Business Week, in that transaction Greenspan pocketed more than $47 Million.

Another VERY important aspect of this lawsuit is the lawsuit timeline.

The suit was filed on November 2, 2006. On November 22 MySpace filed a motion to dismiss LiveUniverse’s complaint. The court held a hearing on December 18 in which it granted that motion, but gave LiveUniverse an opportunity to clarify one premise of the complaint.

On January 16, 2007 LiveUniverse filed a First Amended Complaint (FAC). On February 5, MySpace filed the motion to dismiss the FAC.

The court held a hearing on March 5 and presented its decision on June 4, 2007.
In only seven months, this lawsuit went from initial complaint to resolution. Lawsuits do not have to drag on for years while depleting the assets of both parties. As was done here, good lawyers look for, create and act on opportunities to move toward resolution.

Continue reading "VidiLife.com (LiveUniverse) Loses Antitrust Case Against MySpace.com" »

Last month final approval was given for a class action settlement involving “click fraud” that has Yahoo paying nearly $5 million in attorney fees and giving full credits to advertisers dating back to 2004.

The judge's action on Monday settles claims by Checkmate Strategic Group that Yahoo charged advertisers for clicks on online ads that were done in bad faith or fraudulent.

Although preliminary approval was given last summer, final approval for this settlement was held up by attorneys representing parties in a similar (Google) lawsuit in Arkansas. The California settlement releases Yahoo from all similar click fraud claims against it in other actions in all other states. That’s an offer Yahoo couldn’t refuse.

Reggie Davis, Yahoo's new vice president of marketplace quality stated “Final approval of the settlement validates the strength of Yahoo's click-through protection systems, and our commitment to delivering a quality experience to both our advertisers and our consumers. Our commitment does not stop here. Quality is a top priority for Yahoo, and we have a clear road map for how we're going to create the highest-quality search-advertising network in the industry."

Additionally, in my opinion final approval of this settlement allows Yahoo to put this resource draining litigation behind them, allowing Yahoo to focus on the future of the internet search business.

Putting litigation behind you is often a wise strategy in business.

Continue reading "California Judge Gives Final OK to Yahoo Click Fraud Settlement" »

In a case that closely mirrors a 2004 California lawsuit, New Hampshire has a law requiring anyone or any business running real estate ads on the web for New Hampshire homes to be a real estate broker. An internet listing service ZeroBrokerFees.com sued the New Hampshire Real Estate Commission and the state attorney general last year challenging the constitutionality of the law.

The Real Estate Commission failed in their attempt to have the suit dismissed. U.S. District Court Magistrate Judge James Muirhead ruled on Tuesday March 13 that the lawsuit presents important free speech questions that can and should be resolved in court.

ZeroBrokerFees.com argued that it provides advertising services similar to newspapers that publish Real Estate ads online and in print.

In late 2004, California lost a similar case when Sacramento U.S. District Court Judge Morrison C. England Jr. ruled that ForSaleByOwner.com did not need a RE Broker’s license to publish paid ads listing properties for sale any more than any print publication.

In my opinion, it seems that a great deal of taxpayer money is being wasted making sure that internet companies enjoy the same free speech rights as newspapers.