RECENT DEVELOPMENTS IN INTERNET LAW IN THE USA Presentation to the Israeli Internet Association 6 th...

RECENT DEVELOPMENTS IN INTERNET LAW IN THE

USA

Presentation to the Israeli Internet Association

6th Annual ConferenceRamat Gan, Israel

Presented by Mordechai Chirnomas, Adv., Patent Attorney

Shiboleth Yisraeli Roberts Zisman & Co.

18.02.2002 Copyright by Mordechai Chirnomas. All Rights Reserved

A Website generally may be considered as having two main characteristics;

it is functional

and it is a publication.


Applicable areas of law:

Functional/utilitarian aspects invoke law of:

patent trademark trade secret

Publication aspect invokes law of:

copyright trade dress


Defensive Steps

Check to make sure no one claims the exclusive rights to what you want to do or to what you want to allow others to do where you are acting as a host.

Know the competition


Searching

Patent search:

www.uspto.gov; http://gb.espacenet.com/; www.delphion.com; http://www.questel.orbit.com/patents/; and your friendly patent attorney


Searching

Trademark search:

http://www.uspto.gov/teas/index.html; http://www.saegis.com; http://www.thomson-thomson.com/; CompuMark, etc.


Host or ISP liability: Amazon.com Immune from suit for third

party book reviews. Schneider v. Amazon.com, No.

46791-3-I (Wash. Ct. App. 17 Sept., 2001). This is the first case to make clear that the protection afforded to ISPs by the Communications Decency Act also extends to web site operators.

Ebay Not Liable For Sale of Counterfeit Movies Listed On Auction Site. Hendrickson v. Ebay, No. CV-01-0495 RJK (C.D. Cal. Sept. 4, 2001).


Offensive steps

Build your own fences using:

patent applications; trademark registrations; copyright notices; and trade secret.


YOU WANT TO RELY ON TRADE SECRET? Here is what you need to be prepared:1. own competitively advantageous information not generally

known to the public.2. Take steps to maintain the information as trade secret. NDA

and invention-assignment agreements for all employees, contract workers, and NDAs with consultants, vendors and other outsiders.

3. Limit access to work areas, put warning notices on documents, take computer security measures, interview entering and exiting employees, monitor company Website content and make sure Internet and Intranet traffic are isolated from one another.

4. When an employee leaves, remind him of his obligations and write a letter to his new employer of those obligations.

Cont’d


More Trade Secret5. Teach employees to beware of how they use e-mail. 6. Discovery of electronic forms of information storage in the US of

your business representative or subsidiary there can be expensive and extensive.

7. To avoid accusation of trade secret misappropriation from bringing in a former employee of a company working in similar technology areas. Make sure to warn the employee that he must bring nothing with him from the former job. Anything found should be confiscated and returned.

8. Consider new idea proposals from customers or outsiders under NDA or agreement only.

Failure to require confidentiality agreements for employees or tell them that the company machines were secret undermined trade secret protection claim, (Zemco Manufacturing Inc. v. Navistar International Transportation Corp., IN Ct. Of App.)

Recent Cases and News


Patents British Telecom Claims Patent on Hyperlinks

British Telecommunications claimed in federal court last Monday that it owns the patent on Internet hyperlinks and should get paid for their daily use by millions of people. (British Telecommunications PLC v. Prodigy Communications Corp., S.D.N.Y., No. 00-9451, argument held 2/11/02)


Internet Treaty 'Internet' Treaty to Enter Into Force The accession by Gabon means that the

WCT will enter into force on March 6, 2002. The WIPO Performances and Phonograms Treaty (WPPT) is also expected to enter into force in the near future, the U.N. agency said, when 30 countries have become party to it (the number stands at 28 to date).


Jurisdiction In Rem Jurisdiction Provisions of

Anticybersquatting Act Withstand Constitutional Challenge

Cable News Network L.P. v. Cnnews.com, No. 00-2022-A (E.D. Va. Sept. 18, 2001). The action was brought by Cable News Network to adjudicate the rights to the cnnews.com domain name.


DOMAIN NAME REGISTRATION & OWNERSHIP - CYBERSQUATTING

An Internet registry is not subject to anticybersquatting liability when it accepts domain name registrations, the U.S. District Court for the Northern District of Texas holds in "Lockheed Martin Corp. v. Network Solutions Inc. "


Despite that… Amicus Brief in 'Kremen v. Cohen, et.

al. and Network Solutions, Inc.' Nos. 01-15899 & 01-15886 U.S. COURT OF APPEALS, 9th CIRCUIT

In the American Internet Registrants Association's brief in support of reversing the district court's summary judgment in favor of Network Solutions, Inc., the AIRA supports Gary Kremen's claims for conversion, negligence and breach of contract based on NSI's alleged mishandling of the domain name "sex.com."


Don’t! Registering domain names that are

intentional misspellings of distinctive or famous trademarks constitutes unlawful conduct under the Anticybersquatting Consumer Protection Act (Shields v. Zuccarini, 3rd Cir., No. 00-2236, 6/15/01).


Thumbnails of Copyrighted Web Photos Are Fair Use, Full Size Aren't

Search engines can display "thumbnails," but not full-sized images of copyrighted works on their Web sites (Kelly v. Arriba Soft Corp. (now Ditto.com), 00-5521, 9th U.S. Circuit Court of Appeals, 6th February, 2002). Reproducing photographs to create thumbnail images is a fair use of the material, but displaying full-sized images violates the copyright owner's exclusive right to publicly display his works.


Something You Can Do (But Probably Shouldn't) Unseen Programming Code Containing

Mark Is Not Actionable 'Commercial Use' of Mark

The creation of an unseen, programmatic link to a trademark owner's Web site was not a "commercial use" or a use "in connection with goods or services" of the mark actionable as dilution or infringement under the Lanham Act (Ford Motor Co. v. 2600 Enterprises, E.D. Mich., No. 01-CV-71685-DT, 12/20/01).

The court accordingly declined to issue a preliminary injunction barring the use of Ford Motor Co.'s mark to create a hidden, but automatic link between "f*ckgeneralmotors.com" and Ford's official Web site.


DOMAIN NAME IS A CONTRACT RIGHT, NOT A PROPERTY RIGHT, ABSENT TRADEMARK RIGHT.

Zurakov v. Register.com Inc., N.Y. Sup. Ct., N.Y. Cty., No. 600703/01, 7/25/01). Plaintiff Michael Zurakov, registered the domain name Laborzionist.org with defendant

Register.com Inc. and entered into a service contract for that name. Prior to Zurakov's construction of his Web site corresponding to his domain name, Register linked the domain name to a site containing a "Coming Soon Page." Zurakov sued Register, claiming that the linking of his domain name to Register's "Coming Soon Page" violated the implied covenant of good faith and fair dealing, as well as state business law statutes. Zurakov alleged that his registration of the domain name gave him an exclusive property right in the name, thus giving him exclusive control over it as well.

In Network Solutions Inc. v. Umbro International Inc., 529 S.E. 2d 80, 54 USPQ2d 1150 (Va. 2000) (59 PTCJ 879, 4/28/00), the court said, "a domain name registrant acquires the contractual right to use a domain name for a specified period of time." In Dorer v. Arel, F. Supp.2d 558 (E.D. Va. 1999) (58 PTCJ 605, 9/23/99), the court said that "a domain name that is not a trademark arguably carries with it only contract, not property, rights." The Dorer court distinguished domain names from patents and trademarks, noting that "a domain name is a valueless address with potential to become valuable depending on its use."


Limitation of Liability Contained in Clickwrap License Enforceable Under Article 2 of UCC

A clickwrap license, limiting a software manufacturer's damages liability to a licensee for license fees paid to use the software, is an enforceable agreement under the Uniform Commercial Code (i.LAN Systems Inc. v. NetScout Service Level Corp., D. Mass., No. 00-11489-WGY, 1/2/02).

The court held that clickwrap licenses are enforceable under Article 2 of the UCC, and that the defendant expressly agreed to the clickwrap license when it clicked "I agree" upon installation of the disputed software. The court also found the clickwrap licenses enforceable under ProCD Inc. v. Zeidenberg which relied on the implicit assent to a shrinkwrap license.


SEX Zoning Law Regulating Operation of Adult Entertainment

Not Applicable To Internet Dissemination of Live Video A web site providing live video of adult activities taking place in

a residence in Tampa, Florida, does not violate the city's zoning prohibition against the operation of "adult entertainment establishments" in a residential zone. Voyeur Dorm, L.C. v. City of Tampa, No. 00-16346 (11th Cir. Sept. 21, 2001). The web site enables subscribers to view the activities of young women in all areas of the residence. The court held that the operation of the service does not fall within the prohibition of the zoning ordinance because the public does not "physically attend" the premises. The court concluded that the "offering" of the entertainment "occurs when the videotaped images are dispersed over the internet and into the public eye for consumption."


More Sex Once a Bunny, Always A Bunny

Playboy Enterprises cannot stop a former bunny from referring to herself on the Internet as a former Playboy Playmate of the Year. A federal appellate court in California ruled on Feb. 4 that Terri Welles may continue to refer to herself as "Playboy Playmate of the Year for 1981" on her Web site because it accurately identifies her as a former Playboy Playmate of the Year.

Thank You

Presented by Mordechai Chirnomas, Israeli Adv. and US Patent Lawyer

Shiboleth Yisraeli Roberts Zisman & [email protected]

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