On May 8, 2012, the New York Court of Appeals issued a ruling that merely viewing child pornography on the internet is not a criminal act under the New York Penal Code. The People v. James D. Kent, Index 70, NYLJ 1202552838004, at *1 (Ct. of App., Decided May 8, 2012). The rationale behind the decision of the state’s highest court bears discussion on a much broader scale due to its potential bearing on the legal definitions of procurement, possession and control of digital property.

The key question under consideration was the evidentiary significance of temporary internet files (or cache files) that are automatically created and stored on a the hard drive of a computer while the user is browsing the internet. The Appellate Court concluded that the act of viewing a web image alone does not, absent other proof, constitute either possession or procurement.

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Trade dress insurance coverage is alive and well. At least in Wisconsin. In Acuity v. Ross Glove Company, 2012 WL 1109035 (Wis. Ct. App. April 4, 2012), the Wisconsin Court of Appeals held that an insurer’s duty to defend was triggered under advertising injury liability coverage where the underlying complaint set forth allegations of trade dress infringement.

In the Acuity case, Ross Glove purchased a commercial general liability policy from Acuity, which included advertising injury liability coverage. The policy at issue defined “advertising injury”, in part, as “infringing upon another‘s copyright, trade dress or slogan in your advertisement.”

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So, you think that a corporate cyberattack has nothing to do with you? If so, think again. Indeed, to the extent you own stock or securities, the value of your holdings could be at risk in the event of a cyberattack. I’ve said it before and I’ll say it again: Cybersecurity is an economic issue. See here.

Take, for example, Intel (INTC). In the “Risks” section of its 2009 10-K, the company disclosed in a tersely worded statement that its networks had been the victims of “sophisticated” attacks. Kudos to Intel for making this disclosure, which predated the October 2011 publication of the SEC Guidance addressing public companies’ cyber risks and exposures (discussed here and elsewhere, including in the March 2012 edition of the Advisen Cyber Journal. Please feel free to contact me for details on how to obtain this must-read issue and subscribe. Advisen has done a masterful job, as it does with all of its publications). As will be discussed in my next post, a significant number of public companies still have not complied with their cyber risk and cyber exposure reporting “obligations” under the SEC Guidance.

As to Intel, the subject 10-K listed several noteworthy risks. The most intriguing stated that “We may be subject to intellectual property theft or misuse, which could result in third-party claims and harm our business and results of operations.” Intel’s disclosure continued that “[w]e regularly face attempts by others to gain unauthorized access through the Internet to our information technology systems by, for example, masquerading as authorized users or surreptitious introduction of software….These attempts, which might be the result of industrial or other espionage, or actions by hackers seeking to harm the company, its products, or end users, are sometimes successful.”

The adverse economic impact of a cyber-related disclosure is not theoretical, either. Indeed, in the immediate wake of the News Corp./News of the World cell phone hacking scandal in mid-2011, News Corp’s market cap reportedly fell by over 15%, valued at approximately $7 billion, in less than a week. Not surprisingly, News Corp was sued shortly thereafter in a series of securities fraud class actions, which remain pending.

While cyber risks and exposures may or may not have an impact on a stock’s trading price, their potential impact can not be ignored. Google (GOOG) is another example. As previously discussed here, Google has been the subject of cyberattacks which it claims were precipitated by the Chinese government. The import of this development can not be understated, as it created tensions between the U.S. and Chinese governments and even made it into Intel’s SEC filing. For private citizens, however, perhaps the greatest implication of the Google cyberintrusions is the arguable effect that they had on Google’s price per share. On January 12, 2010, when the intrusion was publicly disclosed, Google shares fell 1.7% to $590.48. By April 25, 2010 Google’s shares were trading at $544.99, another roughly 8% price drop. Can these losses be directly linked to the breach of Google’s security systems? Put differently, can a possible link be dismissed? That’s for shareholders and others to decide.

So, what does this all mean? At a minimum, it suggests that the economic implications of a cyber event can be wide ranging, from the simple cost of fixing a security gap to a major hit to a brands’ reputation (remember News of the World? After 168 years of tremendous success globally, it ceased publishing on July 10, 2011 as a direct result of the hacking scandal), all the way to claims arising from the theft of consumer’s personal and financial information. Such an intrusion into the systems of retailer T.J. Maxx (TJX) lead TJX to settle with regulators, states, consumers and others and set a settlement/remediation reserve of over $100 million.

In the end, it is clear that just as consumers need to be vigilant about monitoring their personal and financial information to protect themselves from identity theft and the like, investors too must regularly track their holdings to protect their portfolios and assets. As to the companies whose information and systems are at risk, the need for both D&O and cyber insurance is patently obvious, and is as important as the protection of their intellectual property, consumer information and other non-public data. Risk management, information protection and insurance go hand in hand. And we’re here to make sure everyone recognizes the correlation.

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The following article was co-written by my Health Care Department colleagues Sal Rotella and Bill Conaboy. Thanks guys!

Rick

On March 13, 2012 – almost 30 months after becoming one of the first entities to self-report a breach under the Health Information Technology for Economic and Clinical Health (HITECH) Act – BlueCross BlueShield of Tennessee (BCBST) agreed to pay the Department of Health and Human Services (HHS) a record setting $1.5 million civil monetary penalty (CMP) for failing to safeguard protected health information (PHI).

The HITECH Act and HIPAA Enforcement

HHS adopted the interim final rule for HITECH’s breach notification requirement only a few weeks before the BCBST breach. The final rule requires covered entities to notify HHS following a breach of unsecured PHI. If a breach affects 500 or more individuals, the covered entity must report the breach electronically “without reasonable delay and in no case later than 60 days from discovery of the breach.”

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The following article was first published by our colleague Michael Schmidt on his blog, Social Media Employment Law Blog. It is part of our continuing effort to keep Cyberinquirer readers on top of decisions relevant to Social Media in the context of litigation. Thanks for the reprint, Mike.

Two weeks ago, I discussed the California case of PhoneDog v. Kravitz, where an employee, who used a company Twitter account as part of his job duties, left the company and continued to use the same Twitter account and tweet to the same followers. The (former) employee claimed that he had the right to continue tweeting, and PhoneDog responded that he was barking up the wrong tree (best I could do at the moment). As I mentioned in my last post, the court had denied the employee’s attempt to dismiss the entire case at inception, and allowed the company to amend its complaint to provide more specificity on some of its claims. Time for an update.

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The following article, written by my colleague Nicole Moody, first appeared in the Chicago Daily Law Bulletin. Thanks to Nicole for allowing us to republish it here.

Rick Bortnick

Many of us have been there. Sipping our morning coffee, signing into our Facebook accounts, waiting to see what notifications will greet us. We are intrigued to see that we have a friend request.  Who could it be? An acquaintance from the past? A new colleague who we met at work? Whoever it is, we know that by accepting the request we will be granted access into this individual’s life and will know more about them in five minutes than we would know in a lifetime of small talk.

Due to the use of usernames and passwords, there is a belief that information shared on Facebook is confidential unless publicly shared. However, courts around the country are now addressing just how private this information really is.

In cases nationwide, litigants are asking courts to grant unfettered access to other parties’ Facebook or other social media accounts. Inevitably, in the age of status updates and hashtags, poking and friending, the lines between public and private information have become blurred. This trend has become increasingly prevalent in the insurance industry as insurance companies have realized the usefulness of social media in litigation. 

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The following article was first published by our colleague Michael Schmidt on his blog, Social Media Employment Law Blog. It is part of our continuing effort to keep Cyberinquirer readers on top of decisions relevant to Social Media in the context of litigation. Thanks for the reprint, Mike.

What would you do if your employee continued to use your company’s Twitter account after he stopped working for you?

What if your (former) employee claimed that he, not your company, actually owned the rights to the Twitter followers?

Ever thought about it?

I have posted several times about how social media has not created new causes of action, but rather has provided a new application for traditional claims. One of the areas that I surmised would develop in time was the interplay between social media and post-employment competition and trade secret rights. According to two new decisions, that time has apparently come.

In PhoneDog v. Kravitz (Northern District of California), the company gave its employee (Kravitz) use of a Twitter account as part of his employment. Kravitz tweeted information to promote the company’s services, and generated approximately 17,000 followers. Kravitz left the company, and, while he changed the account “handle”, he continued to use the same account to tweet to the same followers. PhoneDog sued Kravitz for continuing to use the Twitter account, claiming that the “compilation of subscribers and the password used to access the account” constituted company trade secrets. Valuing each of the 17,000 followers at $2.50, the company sought damages of $340,000 for “stealing” each of those followers for 8 months.

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The following article first appeared on Mike Schmidt’s Cozen O’Connor blog, socialmediaemploymentlawblog.com. Thanks to Mike for allowing us to republish it as a follow-up to our December 2, 2011 post, Keep Your Friends Close, But Your Facebook Posts Closer, which addresses a Pennsylvania trial court’s ruling that ”plaintiff’s Facebook information is discoverable, provided the defendant has a good faith basis for seeking the material,” and our October 16, 2011 post, Facebook: Everything You Want to Know and More… Just a Discovery Request Away, where we comment on how easy it actually is to obtain information posted on Facebook.

Needless to say, the discoverability of social media posts is an important issue for litigants on both sides of the “v” and will continue to be the subject of fiercely-litigated motion practice. We will monitor the issue and post updates as courts across the country rule on this imporant, oftentimes substantively dispositive, issue.

Rick Bortnick

One of the high-profile battles being fought in the social media world continues to be over the ability of one party in a lawsuit to compel the other party to produce messages, posts, pictures, and other “private” things done over a social networking site like Facebook.   The trend continues to reveal that courts are willing to compel disclosure in the right circumstances, and the most recent decision issued by a New York appellate court is no different.

In Patterson v. Turner Construction Company (New York Supreme Court, Appellate Division, First Department, October 27, 2011), the plaintiff sued for personal injury damages that included physical and psychological injuries that he claims to have suffered.   During the lawsuit, the defendant asked the court to direct the plaintiff to provide an authorization allowing defendant to obtain “all of plaintiff’s Facebook records compiled after the incident alleged in the complaint, including any records previously deleted or archived[.]”   The plaintiff, obviously, fought that request.

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As regular Cyberinquirer readers know, on October 12, 2011, the SEC’s Division of Corporate Finance published “suggested” Guidance on public companies’ disclosures of their cyber risks and exposures. I published a personal perspective on the implications of the Guidance in an October 29, 2011 post (here). Since then, our friend John Doernberg of William Gallagher Associates in Boston has written an excellent, thoughtful article which adopts a more technical approach. As many of you may know, John is a Vice President at William Gallagher and focuses on privacy, information security and risk management issues. Before becoming an insurance broker in 1995, John practiced law at leading firms in New York and Boston. The following article first appeared at John’s own site, http://blog.wgains.com/?s=Doernberg, and is being republished here with his permission. Thanks John!

Rick Bortnick

Increased corporate reliance on computer networks and electronic data has brought a corresponding increase in risks associated with breaches of their security. Such breaches have become more frequent and severe. With these Guidelines, the Division has indicated that public companies and their advisors should focus greater attention on how disclosure obligations under the federal securities laws may be affected by the potential financial and operational impact of cybersecurity breaches.

The Guidelines note that cybersecurity breaches (generically referred to as cyber incidents) can be malicious (cyber-attacks) or unintentional. The Guidelines provide something of a rogue’s gallery of cyber malice: the gaining of unauthorized access to steal or corrupt sensitive data or to disrupt operations, denial of service attacks, sophisticated electronic circumvention of network security, and social engineering techniques such as phishing to extract passwords or other information that will enable the gaining of access.

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“Facebook helps you connect and share with the people in your life.” That is the Facebook mantra, as displayed on its homepage, and the opening line of a recent – and extremely thorough! – Pennsylvania trial court decision regarding the discoverability of a plaintiff’s relevant Facebook information. The court’s conclusion: a plaintiff’s Facebook information is discoverable, provided the defendant has a good faith basis for seeking the material, because there is no confidential social networking privilege under Pennsylvania law and because the Stored Communications Act only applies to internet service providers. The take-away for Facebook users: be careful what you post – it’s not as “private” as you think!

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Its not often that worlds collide or that interests converge into one amorphous epiphany. But that’s exactly what happened to me recently, when the Division of Corporate Finance (DCF) of the U.S. Securities and Exchange Commission (SEC) issued a Disclosure Guidance identifying the types of information public companies should consider disclosing about cyber risks and events that could impact their financial statements. Now, the DCF has cautioned that the Disclosure Guidance only represents its own views and “is not a rule, regulation, or statement of the Securities and Exchange Commission.” The DCF also emphasizes right up front that ”the Commission has neither approved nor disapproved its content.” Yeah, right. YOU be an officer or director or officer of a company that does not “comply” with the DCF’s  ”recommendations.”

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Businesses that necessarily require their customers to disclose credit card and personal information, beware.   Just five days ago, the United States Court of Appeals for the First Circuit held that claims by class action plaintiffs for ”mitigation damages” arising from alleged negligence and breach of contract were viable.  Anderson v. Hannaford Brothers Co., Nos. 10–2384, 10–2450, 2011 U.S. App. LEXIS 21239 (1st Cir. Oct. 20, 2011). 

In Anderson, the electronic payment processing  system of a national grocery chain, Hannaford Brothers Co., was breached by hackers in 2007. This resulted in the dissemination of as many as 4.2 million credit card and debit card numbers, expiration dates, and security codes.  Hannaford Brothers was not notified of the breach until February 27, 2008 and subsequently contained the breach on March 10, 2008.  A week later, Hannaford released a statement regarding the breach and announced that over 1,800 cases of fraud resulting from the theft already had been reported. 

Following Hannaford’s announcement, several financial institutions immediately cancelled customers’ debit and credit cards.  Some financial institutions, which refrained from immediately canceling the credit card, monitored the accounts for unusual activity, cancelling the cards, in many cases, without notifying the customer.  Customers who asked that their cards be cancelled incurred fees from issuing banks for the replacement cards. 

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On October 17, 2011, the U.S. Court of Appeals for the Tenth Circuit issued a much-anticipated decision addressing the scope of “Advertising Injury” (“AI”) coverage for patent infringement claims.  Dish Network Corp. v. Arch Specialty Ins. Co., No. 10-1445, __ F.3d __ , 2011 U.S. App. LEXIS 20955 (10th Cir. 2011), rev’g, 734 F. Supp. 2d 1173 (D. Colo. 2010).  The court, applying Colorado law, reversed a decision from the District of Colorado in which that court granted summary judgment to the insurers.  In the underlying action, the plaintiff alleged that Dish Network Corp. (“Dish”) had infringed one or more of twenty-three patents by “making, using, offering to sell, and/or selling . . . automated telephone systems, including . . . the Dish Network customer service telephone system, that allow[s] Dish’s customers to perform pay-per-view ordering and customer service functions over the telephone.”  The Tenth Circuit concluded that the record was unclear about how Dish actually used the technologies at issue, but that some of the patent-holder’s most well-known innovations involved interactive call processing. 

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I recently attended a CLE that had a panel of social media experts who were discussing the role of Facebook, Twitter and MySpace in litigation. During a lull in the question and answer session, the Facebook attorney quipped: “you know, Facebook has already given you everything that you’ve ask for…” Immediately, the audience lifted their heads from their Blackberries and newspapers and started paying attention after this cryptic remark.

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I. Overview

Canada’s privacy regime can be described as a web of legislation at both the federal and provincial/territorial level. Some commentators express concern that this web has become tangled, lacks uniformity and actually undermines the predictability and consistency that, in their view, would exist under a single (federal) privacy regime. Canada has two primary privacy statutes: the Privacy Act and the Personal Information Protection and Electronic Documents Act (“PIPEDA”). The Privacy Act, R.S.C. 1985, c. P-21 (Can.), took effect on July 1, 1983, and imposed certain privacy rights obligations on approximately 250 federal government departments and agencies by limiting the use and disclosure of personal information. The Privacy Act also gives individuals the right to access and, if necessary, correct personal information held by governmental organizations subject to the Act.

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I.                    Introduction

The Internet facilitates the widespread and instantaneous flow of information across international borders.  While the advent of this method of transnational communication has truly created a “global economy,” at the same time, it has engendered problems for companies and their insurers which seek to assess risk and implement information safeguards, particularly in the face of divergent data privacy laws which vary from region to region or may not even exist in certain jurisdictions.  The Asia-Pacific region typifies such a lack of uniformity.  At the same time, the emerging economies in this rapidly growing part of the world have generated promising targets for computer hackers. 

75% of Asia-Pacific enterprises have experienced cyber attacks in the past 12 months.  Perhaps not surprisingly, a 2010 study by Symantec reported that almost half of all Asia-Pacific-based businesses (and 67% in Singapore) ranked cyber risk and information security as their top concern—more so than natural disasters, terrorism, and traditional crime combined.  Cyber attacks and data breaches are on the radar of CEOs and risk managers for good reason: the average cost for a large company to remediate a data breach in Australia increased to nearly $2 million in 2010, which is slightly up from 2009.  See Ponemon Institute/Symantec 2010 Annual Study: Australian Cost of a Data Breach (May 2011).  Notwithstanding the prevalence of such attacks, it is far more likely that a cyber security program is managed as a part of a company’s traditional business risks, with traditional coverages being contorted to cover various components of cyber risk (i.e. property loss, liability to third-parties, business interruption, etc.), rather than by way of a dedicated cyber-specific insurance program.  Still, in light of recent developments, it is virtually certain that companies soon will begin looking to transfer such risk via more efficient and targeted technology insurance forms and policies.   

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First published on September 22, 2011 at e-Discovery Law Review
Monetary sanctions, attorneys fees, and adverse inference jury instructions are the more common type of sanctions imposed on litigants for the spoliation of evidence, or not producing relevant documents. Recently, however, a court has increased the severity and impact of sanctions by applying them not only to current litigation, but also to a party’s future litigation, with the effects lingering for years to come.

The Underlying Suit

“Any competent electronic discovery effort would have located this email.” These words were written in an opinion by a United States District Judge in the Eastern District of Texas in Green v. Blitz U.S.A., Inc., No. 2:07-CV-372 (E.D. Tex., Mar. 1, 2011) Green involved a product liability suit in which the requirement of a flame arrester was in dispute. The jury returned a defense verdict, and the plaintiff collected a low settlement amount as part of a high-low settlement agreement. During discovery in a subsequent case with the same defendant and plaintiff’s counsel, counsel learned of documents that were not produced in Green. The plaintiff then filed a motion for sanctions against the defendant in Green and a motion to re-open the Green case. While the court denied the motion to re-open because the statute of limitations had expired, the court did impose sanctions for the discovery abuse.

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The protracted copyright infringement class action by freelance writers seeking compensation for pieces published without authorization in various online databases has hit another roadblock.

In re Literary Works in Electronic Databases Copyright Litigation involves claims for infringement of works as to some of which the copyrights are registered and the vast majority are unregistered. This detail – the registered/non-registered distinction – keeps stymieing resolution of the case. In 2007, after the parties had spent years negotiating a settlement and gaining district court approval, the Second Circuit threw out the settlement, holding that the district court lacked subject matter jurisdiction to approve the settlement because many of the claims to be resolved were based on unregistered works, and registration is a jurisdictional predicate to a copyright infringement suit. The Supreme Court finally reversed in 2010, and the parties went back to the district court and again gained approval of the settlement.

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The ABA has issued a formal ethics opinion that provides guidance to lawyers whose clients use an employer’s email account to send or receive email from counsel.  In Formal Opinion 11-459, the Standing Committee on Ethics and Professional Responsibility urges lawyers to warn their clients that the confidentiality of electronic communications may be jeopardized if the employer or other third party, such as a hotel or library, has the potential to access email or other correspondence hosted on the third party’s computer system.

When clients use an employer’s computer, smartphone or other telecommunications device, or an employer’s email account, the employer may be able to obtain access to the communications and take advantage of that opportunity in various contexts, such as when the client is engaged in an employment dispute or when the employer is responding to a subpoena or document discovery in litigation.

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A recent Ninth Circuit opinion on class certification demonstrates both the potentially fact-intensive nature of class action “typicality” issues and the importance of substantive law in determining whether common issues predominate over individual issues.

In Stearns v. Ticketmaster Corp., the Ninth Circuit Court of Appeals reviewed several decisions denying class certification to various plaintiffs challenging an allegedly deceptive internet scheme involving Ticketmaster and its one-time affiliate, Entertainment Publications, Inc. (“EPI”). At issue is a link on Ticketmaster’s website to EPI’s Entertainment Rewards program, which allows members paying a monthly fee to download printable coupons.

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The following article was published in the September 1, 2011 edition of National Underwriter’s Property Casualty 360 website. 

I.     Introduction: Insurance Products for Cyber Risks

Increasing reports of cyber intrusions, data theft and computer system malfunctions have led a rapidly-growing number of companies to purchase insurance coverage to protect themselves from technology and cyber privacy risks. Indeed, as our technology-driven economy continues to evolve and businesses become more reliant on electronic communication and data storage, they are developing a heightened awareness that an unauthorized intrusion could endanger their tangible and intangible assets (including their intellectual property) and, in many cases, their reputations and abilities to conduct business. As such, prospective policyholders are becoming more cognizant of the necessity for insurance covering such growing exposures.

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The Clerk for the U.S. District Court for the Eastern District of Pennsylvania recently ruled that there is a heavy presumption that prevailing parties may recover certain e-discovery costs under 28 U.S.C. § 1920. Federal Rule of Civil Procedure 54(d)(1) allows prevailing parties to submit bills of costs for certain expenses, enumerated in 28 U.S.C. § 1920, for taxation by the Clerk against the non-prevailing parties. For example, that statute provides for the taxation of costs related to obtaining copies of transcripts and printing. More significantly, the statute provides for the taxation of “[f]ees for exemplification and the cost of making copies of any materials where the copies are necessarily obtained for use in the case.” 28 U.S.C. § 1920(4). While the term “exemplification” is undefined, federal district clerks have traditionally awarded, as exemplification and copying costs, those costs related to the production of paper documents, photographs, models, maps, blow-ups, charts, and diagrams.

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In a recent decision, a Pennsylvania trial court concluded that no privilege exists to prevent access to non-public social website information of personal injury claimants. Rather, the “paramount ideal” of pursuing truth favors liberal discovery of relevant information on social media sites.

In Zimmerman v. Weis Markets, No. CV-09-1535 (C.P. Northumberland Cty., May 19, 2011), the court rejected a personal injury plaintiff’s objections to providing non-public portions of plaintiff’s Facebook and MySpace pages, after the defendant demonstrated that the public portions of those pages included recent photographs and comments that appeared to contradict the plaintiff’s claims of physical and emotional distress. The court agreed with the rationale stated in other recent cases holding that an individual who voluntarily posts photos and information on social networking sites does so with the intention of sharing, and thus cannot later claim any expectation of privacy. The court noted that the privacy policies of Facebook and MySpace disclose that any information posted may become publicly available at the user’s own risk.

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Just as lawyers now routinely conduct due diligence on opposing parties’ social media pages. some lawyers also are monitoring postings by jurors on social media sites.

In a recent ethics opinion issued by the New York County Lawyers’ Association Committee on Professional Ethics (No. 743, 5/18/11), the committee concluded that an attorney may review jurors’ postings on publicly available social networking sites during trial. But they must not “friend” or “tweet” jurors, subscribe to their Twitter accounts, or otherwise contact them, either directly or through others.

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Well, this result seemed almost inevitable.  After all, who gets away with misleading a court?  Right?  But is the amount of the sanction sufficient?  Righthaven was ordered to pay a measly $5,000.  Is that amount really going to punish Righthaven in any significant way?

Righthaven LLC is a copyright holding company, founded in March 2010, which acquires the rights to newspaper content from its partner newspapers (most notably, Stephens Media, which owns the Las Vegas Review Journal). Upon finding that content has been copied to online sites without permission, Righthaven initiates litigation against the site owners, alleging copyright infringement.
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In addition to being a trademark geek, I could be accurately accused of also being a tech geek. A “geek” is someone who loves using, and helping other people use, technology to help simplify his or her life. Best Buy, capitalizing on this endearing term for electronic lovers, created the Geek Squad, a tech support service. Their distinctive orange and black cars marked with their trademarked logo can be called out to provide in-home support or they are just a phone call away to help you with your technological needs.

There’s not too many other words other than geek that convey the nerdy type of people who love technology, but Best Buy is taking action against others who use “geek” for this purpose in their slogans.  In a recent lawsuit against Newegg.com, Best Buy claimed trademark infringement over Newegg’s slogan “Geek On,” saying that the similarity between the motto, in addition to using orange and black in their logo, breaches their rights.  And this is neither the first, nor the last, time that Best Buy will sue companies over this issue.

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It has become common practice for lawyers to mine social media pages of parties and witnesses for discovery purposes. The posts and photos may show a party to be lying about the extent of his or her claimed injury or disability, or they could undermine or support other claims. Facebook and other social media sites also have become fertile ground for cutting edge ethical questions posed to state Bar ethics committees.

In a recent ethics opinion issued by the San Diego County Bar Association, a lawyer asked if it was proper to “friend” request high-ranking employees of a company the lawyer was suing on behalf of a former employee pursuing a wrongful discharge case. The lawyer believed that these high-ranking employees were dissatisfied with the company and likely had been posting negative information on their social media pages that were accessible only to those persons who had been accepted as “friends”.

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During the last decade, individuals and business have changed the way they manage their data by moving this data management offsite – otherwise known as cloud computing. This differs from the old model of information management that, more or less, mirrored the pre-computing era, meaning that an employee’s file might be kept in a cabinet in a Human Resources (“HR”) office or stored on a company’s in-house server. With cloud computing, however, that same employee file may be stored hundreds or thousands of miles away from the HR officer who needs to review it – or the IT officer tasked with preserving that data for potential litigation.

As discussed more fully in Rick Bortnick’s prior posts (here and here), cloud computing outsources data and software management, migrating it from the local to the global by providing instant access over the internet. According to the National Institute of Standards and Technology, cloud computing has five primary characteristics: (1) “on-demand self-service,” or the ability to call up stored data or capabilities as needed; (2) broad network access through a variety of platforms; (3) pooling resources providing “location independence”; (4) “rapid elasticity” in the distribution of computing capabilities, and (5) “measured service,” or service-appropriate control and optimization by the cloud system manager rather than the local user. It is the pooling of resources and the measured service managed by third-parties that pose the greatest risks during e-discovery.
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It seems Righthaven hasn’t been able to catch a break since my December 2010 post.  Righthaven LLC is a copyright holding company founded in early 2010, which acquires newspaper content from its partner newspapers after finding that the content has been copied to online sites without permission, in order to engage in litigation against the site owners for copyright infringement. 

Just last week, in a suit filed against Democratic Underground (“D.U.”), Righthaven sought damages because D.U. used four paragraphs of a 34 paragraph Las Vegas Review Journal article (recall that the Journal and its contents belong to Stephens Media).  The post included a link to the full article, as well as citing the Journal. 

U.S. District Court Judge Roger Hunt dismissed the lawsuit, holding that a “copyright owner [here, Stephens Media] could not assign a bare right to sue.”  In addition, the court came down hard on Righthaven because it failed to advise, as required by law, that Stephens Media had a pecuniary interest in the lawsuits (Righthaven and Stephens Media were sharing the profits received from these lawsuits).  Judge Hunt seemed disgusted with Righthaven’s behavior and gave Righthaven two weeks “to show cause … why [Righthaven] should not be sanctioned for this flagrant misrepresentation to the court.”  Judge Hunt accused Righthaven of trying to “manufacture standing” in all of its cases.  (Click here for the Court’s full decision.) Read the rest of this entry »

Following the publication of our original post on the implications of a cyber attack on investors’ securities portfolios (see here), we have been asked by scores of readers whether securities fraud litigation arising from cyber crime has ensued. Not surprisingly, the answer is “yes.”

Indeed, we have located at least two such cases, one a putative securities fraud class action against a payment processing company and the second an SEC initiated action against a private investor. The results may (or may not) surprise you, depending on your perspective of trial courts’ levels of judicial activism and willingness to render substantive decisions at early stages of litigation.

 In re: Heartland Payment Systems, No. 09-1043 (D.N.J. Dec. 07, 2009) remains the paradigm for such litigation. To facilitate its payment processing services, Heartland Payment Systems (“Heartland”) stored millions of credit and debit card numbers on its internal computer network. In December 2007, hackers launched a Structured Query Language Attack (“SQL attack”) on Heartland’s payroll management system. To its credit, Heartland was able to successfully avert the attack before any personally identifiable information was stolen. At the same time, however, the company failed to detect malicious software (“malware”) which had been placed on the network by the SQL attack.  The malware infected Heartland’s payment processing system, ultimately enabling the hackers to steal 130 million consumer credit and debit card numbers.  Heartland did not discover the breach until January 2009, at which time it notified government authorities and publicly disclosed the event.  Over the course of the following month, Heartland’s stock price dropped over $15 per share. Perhaps not surprisingly, shareholder class actions ensued.

In their complaint, plaintiffs alleged that Heartland and its officers and directors had made material misrepresentations and omissions about the December 2007 SQL attack. Specifically, plaintiffs claimed that the defendants concealed the SQL attack and misrepresented the general state of Heartland’s data security.  Plaintiffs further alleged that the defendants’ conduct was fraudulent because they were aware that Heartland’s network had been breached, yet they had not fully remedied the problem Read the rest of this entry »

On January 20, 2011, a federal class action lawsuit was filed against MySpace in the United States District Court for the Eastern District of New York. If successful, this new lawsuit could have dramatic implications for social networking sites and their users. Either way, it provides another opportunity to make a couple of privacy-related points for employers.

The MySpace lawsuit was filed on behalf of all former and current users of MySpace, who seek damages for the alleged improper and voluntary disclosure of personal and private information and data in response to foreign court search warrants without the knowledge or authorization of the MySpace users. The class alleges that search warrants issued by state judges for certain information have no force and effect when they are issued to MySpace’s California headquarters from other states, but that MySpace nevertheless provided responsive information and data voluntarily.

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Whether you own a website where you allow blogs and comments to be posted, or if you are the blogger/poster, listen up. 

For those of you who haven’t heard of Righthaven LLC, they are to the blogging world what editors are to the Law Review world…cite-checking and anti-plagiarism “proponents” (let’s call ‘em that, for argument’s sake).  Righthaven’s been making quite a splash and has gained popularity among news chains since its coming into existence in the spring of 2010.  According to David Kravets’ article, “Righthaven Expands Troll Operation With Newspaper Giant”[1], Righthaven has filed over 180 lawsuits and has settled over 70 of them already.  Its major suppliers of copyrighted material include Stephens Media (owners of Las Vegas Review-Journal), MediaNews Group (owners of San Jose Mercury News and the Denver Post), and WEHCO Media (owners of Arkansas Democrat-Gazette and Chattanooga Times Free Fress), to name a few.[2] Owned by Net Sortie Systems LLC and SI Content Monitor LLC, Righthaven is the brain-child of Las Vegas-based IP attorney, Steven Gibson.[3] Righthaven’s clients assign their rights in the content to Righthaven, who then sues for copyright infringement.[4] 

In order to analyze the problems faced by the parties to such lawsuits, we’ll have to discuss the U.S. Copyright Act, as well as the Digital Millennium Copyright Act (“DMCA”).

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We wrote to Google and asked what information was required to subpoena Gmail in order to determine the identity of an email customer. Google’s response is below:

Dear Ms. Pengelley:

The information requested relates to services offered by Google Inc., a U.S. company organized and operating in the U.S., and governed by U.S. laws.  As such, we ask that your request be directed to Google Inc. – Attn: Legal Department, and communicated through the proper legal channel.  Please direct further communications to Google Inc. – Attn: Legal Department – at 1600 Amphitheatre Parkway, Mountain View, California, 94043, US, Fax: + 1 650.469.0622, or by email at lis-global@google.com.

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We have all heard a story about some unfortunate personal injury lawyer who forgot to remind his client that ‘what happens in Vegas stays on YouTube’. Personal injury and family lawyers are becoming highly attuned to the crucial role that social media websites can play in civil litigation.

Yet when it comes to cases involving property damage, it appears that lawyers and other subrogation professionals have overlooked the potential utility of these sites in advancing their case. This post highlights some important ways in which YouTube can play a role in a subrogated claim for property damage.

1.   A Search Engine for Video Evidence

YouTube is the second largest search engine in the world. As of March, 2010, twenty-four hours of video was being uploaded to YouTube every minute. To put this in perspective, consider that more video is uploaded to YouTube in 60 days than all three major news networks have created in 60 years. [1] What does this mean? If you have a property damage claim, stop for a minute and think about whether it was an event that was likely to warrant a second glance. Were there flames? An explosion? Did a massive wall of water sweep over the property, obliterating all before it? In that case, it is likely that someone not only had taken that second glance, but pulled out his or her cell phone, recorded a video clip, and posted it on YouTube. Check it out. Simply enter the loss date, location and a one-word description into YouTube’s search engine and you may discover valuable evidence that can provide crucial insights into the loss.

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A “trend” is generally defined as a general course, drift or prevailing tendency.   In the battle between the potential privacy rights of a social networking site user and the desire of a lawsuit party to have full access to the private portions of that user’s profile, the trend favoring full and unfettered access has become clearer with a decision just issued by the Pennsylvania Court of Common Pleas in the case of McMillen v. Hummingbird Speedway, Inc.

In McMillen, the plaintiff was injured during a stock car race, and sued for damages after being rear-ended during a cooling down lap.   He alleged significant physical injuries and overall loss of general health and vitality, as well as an “inability to enjoy certain pleasures of life.” During the lawsuit, the defendants requested that plaintiff identify the name of all sites to which he belonged, and to identify his user name(s), login name(s), and passwords. Plaintiff responded by stating that he belonged to Facebook and MySpace, but he refused to give the other requested information based on confidentiality and privacy grounds.

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This is a story about Beverly Stayart and her efforts to sue Yahoo! and other search engines for linking her name to online content that she felt was offensive.

 Although this lawsuit is rather striking, the case record does not reveal any particularly striking or unusual facts about Beverly, herself.

She is not a celebrity, or at least, was not one when she started this litigation. She has an M.B.A. from the University of Chicago, she has written a few papers about genealogy research that appear on the internet, and she is passionate about the environment. She is interested in the plight of wild horses, wolves and baby seals and has vigorously protested against their mistreatment. She has published two poems about baby seals on a Danish website.

Like many people, Beverly was curious about what she would find when she put her name into Yahoo’s search engine. To her chagrin, upon running a search of her name in 2008, she discovered that in addition to the expected search results, Yahoo! returned results that linked her name to online pharmaceutical companies promoting sexual dysfunction drugs Viagra, Cialis and Levitra, pornographic websites that contained spyware, and links that directed her to other websites promoting “sexual escapades”.

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One of the difficult things to predict with regard to the use of social media in the employment setting continues to be the extent to which traditional legal claims apply equally to new social media outlets.   We continue to advise employers that it is imperative to ensure that care is also taken to create policies and train employees on the use of social media in and out of the office setting, and not to let the informality and ease of the Internet lull employers into a false sense of security.   On July 22, 2010, a New York Supreme Court Judge applied the tort of defamation to statements on Facebook in a case that offers an important message to employers.

The case of Finkel v. Dauber (New York Supreme Court, Nassau County) centered on statements posted by a Facebook group known as “90 Cents Short of a Dollar.” Plaintiff alleged that she was defamed by the group’s postings that stated “unbeknownst to many, [plaintiff] acquired AIDS while on a cruise to Africa” and then “persisted to screw a baboon which caused the epidemic to spread.”   The postings further defamed plaintiff, she alleged, by stating “[w]hile in Africa she was seen fucking a horse.”   And other intelligent banter.

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On July 23, 2010, the United States Court of Appeals for the Eighth Circuit issued an important decision in Eyeblaster, Inc. v. Federal Ins. Co., 2010, U.S. App. LEXIS 15152, No. Civ. A. 08-3640, finding concurrent coverage under both a General Liability (“CGL”) insurance policy and a separate Information and Network Technology Errors and Omissions Liability (“E&O”) policy in circumstances where an online marketing company installed software on a consumer’s computer system, allegedly corrupting the computer’s software operating system.

Eyeblaster Inc. (“Eyeblaster”), the policyholder, is a company that creates, delivers and manages online interactive advertising. For the period December 5, 2006, to December 5, 2007, it was insured under two concurrent policies issued by Federal Insurance Company (“Federal”): (1) a CGL policy covering occurrences which cause damage to tangible property, and (2) an E&O policy which covered claims for financial loss caused by a wrongful act in connection with a product’s failure to perform its intended function or serve its intended purpose, resulting in damage to intangible property. As to the latter policy, intangible property included software, data and other electronic information. Both policies were “duty to defend” forms.

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“A lawyer is never entirely comfortable with a friendly divorce, anymore than a good mortician wants to finish his job and then have the patient sit up on the table.”  Jean Kerr

A new company out of Dallas, DivorceApps.com, is selling applications aimed at helping people navigate the legal waters of divorce. A Texas family lawyer, Michelle May O’Neil, started the company in March of this year. Two apps currently are for sale on iphones at a cost of $9.99 USD.  Applications that are currently available online are described as follows:

(1) Cost and Prep Application: A system that 1) tracks the information that will be required either by legal counsel or the other side of the case and 2) helps the user track the costs of divorce. For example, the “Divorce Cost” portion of the application provides a scroll down list of categories that enables the user to gain a better understanding of the costs of divorce. The “Scroll Down” component of the application allows the user to scroll through the categories of information to determine the documents and information that will be applicable to their case.

(2) Estate Divider Application: The “Estate Divider” is a system that purports to allow a user to work through the overall division of their Estate. The user can:

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Apparently feeling that they’ve resolved the longstanding issue of illegal immigration and can move on to the next crisis, Immigration and Customs Enforcement (“ICE”) and the U.S. Justice Department have identified a new enemy in their ongoing stuggle to protect truth, justice and the American way: Internet sites that sell counterfeit goods and pirated movies.

Indeed, just this month, government officials announced that they have shut down nine websites as part of their newly announced initiative, “Operation In Our Sites,” which is intended to protect Hollywood’s intellectual property. Officials estimated that nearly 7 million pirated movies and shows per month were downloaded from the offending websites.

The announcement was held on a soundstage at The Walt Disney Studios in Burbank, CA. Neither Johnny Depp nor Captain Hook reportedly was present.

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I was recently introduced to a great new Scrabble word: “meme”. According to wikipedia, my source for all things “e-”, a meme, in reference to the Internet, is ‘the propagation of a digital file or hyperlink’ that contains content consisting of a saying or joke, a rumor, an altered or original image, a complete website, a video clip or animation, or an offbeat news story, among many other possibilities. In other words, an Internet meme is an inside joke that is shared between a large number of Internet users.

Internet memes have a tendency to evolve and spread extremely swiftly, sometimes going in and out of popularity in just days. They are spread organically, voluntarily, and peer to peer, rather than by compulsion, predetermined path, or completely automated means. The term ‘meme’ can refer to the content that spreads from user to user, the idea behind the content, or the phenomenon of its spread.

Ally McBeal fans may now appreciate the reference to the dancing ‘oogachucka’  baby. In an effort to be a bit more up-to-date in my meme references, I’ve embedded some of them, below.  If you’re seeing them for the first time, you may experience the ‘lightbulb effect’ – that is, you’ll actually get the joke behind certain late night comedy skits that just didn’t seem all that funny.

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His name is Ghyslain Raza, but you may know of him as “Star Wars Kid”, a portly 15-year-old student at a Quebec private high school who had filmed himself wielding a mock light saber, pretending to be a Star Wars character in combat. The two-minute video was supposed to be private, but he left it lying around at his school where three students, who did not know the teenager, came across the video, posted it on the Internet on April 14, 2003, adding a message inviting people to make insulting remarks about the clip.

Unfortunately for him, it wasn’t just his friends who found the footage so amusing. The video went ‘viral’. One Web log that posted the video was allegedly downloaded 1.1 million times, and by October 2004 one Internet site dedicated to the video had recorded 76 million visits. According to UK marketing firm The Viral Factory, it became the most downloaded video of 2006. So mortified was the teenager that he dropped out of school and finished the semester at a psychiatric ward. According to the student, “It was simply unbearable, totally. It was impossible to attend class.”  More than 35 other revised versions of the video clip, created by other people, have found their way to the Internet, with additional sound and visual effects.

This is an extreme but far from unique example of the devastation wrought by cyber-bullying, the term given to internet conduct in which students harass other students by e-mail and on the internet. Given the potentially devastating consequences of cyberbullying, should schools have the power to discipline their students engaging in this form of harmful conduct?

A major issue confronting school boards is that cyberbullying usually does not take place at school, although its effects can later reverberate among students during school hours. Students may post offensive material from home, or other times outside of school hours, but the targets are fellow classmates. Is it appropriate for a school board to discipline a student for posting such material simply because the postings are being accessed by other students at school or target other students?  At the same time, with power comes responsibility – if school boards have the power to discipline students for their behavior outside of school, are schools then to be mandated with the responsibility to essentially monitor and censor the world-wide web? Just how far should a school board’s jurisdiction extend regarding inappropriate off-school student e-conduct?

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Odd as it may seem to those of us who live and breathe cyber, tech and privacy insurance, I have heard anecdotally of municipal authorities who profess that their cities and towns do not need to incur the expense of buying these products. “Why do we need them? We don’t operate on the internet,” they reportedly have said.

Well, my response is “why don’t you think you need them?” Do you maintain a bank account? Do you store personally identifiable information about private citizens, whether in your property records, police files, tax databases or otherwise? Are your employees able to access your municipality’s computer systems remotely? Is it really possible that every single piece of information you maintain is recorded on paper and nothing is stored on a mainframe, whether located on- or off-site? Come on. Its 2010. That’s virtually impossible, isn’t it? Haven’t you read my December 23, 2009 post “No One is Immune. Even Government Entities Need Cyber/Tech Insurance?”

Since that posting, additional municipalities have suffered cyber attacks and been the subject of cyber lawsuits.

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This topic angers me.  Fines for infringement under the Copyright Act range from $750 to $150,000 per infringement.  That’s a wide spectrum!  More disturbing is that the Act leaves the pricing decision in the hands of the judge, without any real guidelines for them to follow.

This week, a judge ordered Whitney Harper to pay $27,500 for illegally downloading 37 songs…I’ll do the math for you – that’s $750 a song, i.e., the minimum allowed.  Earlier this year, Joel Tenenbaum was held liable for $675,000 for file sharing 30 songs – that’s $22,500 per song.  It gets better.  Nearly a year ago, Jammie Thomas-Rasset was ordered to pay $1.92 million by a jury for downloading 24 songs…$80,000 per download!  How does the court conclude how much to, for lack of a better word, charge per song?  Is it based on the popularity of the song?  Does Lady Gaga or Jay-Z rank higher than Skid Row or Journey because the former are currently more mainstream?

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Jurors are not supposed to look at media coverage of the case during a trial since their verdicts are supposed to based on the evidence presented in a trial, rather than media reports. But can they really resist taking a sneak peek on the Internet?

In February of 2010, the U.K.’s Ministry of Justice released a very interesting report, titled “Are Juries Fair?“, by Professor Cheryl Thomas.  Among other things, the study examined jurors’ use of the Internet to look up information about their cases in both long, high profile cases and standard cases lasting less than two weeks, with little media coverage. The report found:

• All jurors who looked for information about their case during the trial looked for it on the Internet, as opposed to television, newspapers or some other source. (Well, okay, so this one wasn’t exactly a big surprise…).

• More jurors said they “saw” information on the Internet than admitted to “looking for it” on the Internet. Since they were doing something that a  judge should have told them that they were not supposed to do, this may explain why jurors were more likely to say the saw reports on the Internet than said they looked for it. (See? Lawyers aren’t the only people in the courtroom who resort to semantics….). But just what are the figures?

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Pamela Pengelley, our resident expert on Facebook, is now internationally recognized for her expertise. 

Most recently, Pamela was quoted in an article published by Law 360 entitled “Poking Around Facebook Could Win Your Case.” According to Pamela, “‘Lawyers are realizing [Facebook] is a gold mine of information…it’s pretty much standard that you subpoena Facebook when you get a personal injury action. It’s not a substitute for having a private investigator, but people will put up incriminating photos online without realizing that there can be consequences in a lawsuit.’”

Pamela further observed that Facebook is “most effective in lawsuits where plaintiffs are claiming an injury, such as when their health or ability to work has allegedly been impaired”.

Kudos to Pamela. Where will her sage words of wisdom appear next?

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Never underestimate the value of a good domain name! As any website owner will tell you, http://www.rose.com, by any other name, is likely to lose customers.

About a week ago, my colleague’s nephew, Kevin Bortnick, found himself in a domain name predicament. His plight is interesting and he has graciously permitted us to blog about his situation, which provides some useful context for a discussion about domain name disputes.   

Kevin is a talented website developer who used the name “KBortnick” or “KB” for his internet business. In November of 2005, he registered the domain name kbortnick.com for a period of four years, at a cost of about $10 per year. Although the domain name expired in November, 2009, he explained that “I was moving out & had a bit of a money crunch, so I figured I’d renew it in about a month, because it really wasn’t worth anything & I figured it would be fine….”   

A couple of weeks ago, he attempted to re-register the name, only to discover that someone else had purchased it. That unknown ‘someone’ had immediately put it up for sale on a website that auctions off domain names, http://seto.com, subject to a minimum bid of $480. As you can imagine, Kevin was livid. “The highest I’ve ever seen my domain name appraised at was about $30”, he exclaimed, “and most places didn’t even give it that!”   

(I empathized with Kevin’s situation. Over Canadian Thanksgiving, while I was sitting before the computer in a state of turkey-induced lethargy, I was suddenly roused from my stupor by the discovery that the domain name “pamelapengelley.com” could be registered for the low, low price of just $10 a year. I may soon write a post that is entitled “How I learned the hard way that just because you can make a hideously tacky personal flash website dedicated to your glorious self doesn’t mean that you should make one.” But I digress…)   

Kevin’s dilemma got me thinking –  is this what is known as “cybersquatting”?  Is there any remedy for this sort of thing? Does Kevin have any recourse?

In fact, there are a couple of different mechanisms for resolving a cybersquatting dispute, and my understanding of them was greatly assisted by some basic knowledge about the development of the Internet and some tech-related acronyms like “DNS”, “IP” and “ccTLD”. If these terms are unfamiliar to you, then I ask for your indulgence while I lay out some of the basic IT background. It’s a bit lengthy so if you are computer-savvy, you may just want to skip part 1. Read the rest of this entry »

With the report of another data security-related lawsuit involving online banking (another 2009 lawsuit referenced here involved an alleged loss of over $500,000), and a recent victory for a plaintiff on a summary judgment motion in a similar online banking data security breach case, the question arises whether online banking breaches will yield some substantive case law on the issue of “reasonable” security procedures as a matter of law. 

Ironically, this question may be answered by reference to a 20 year old model code (UCC 4A) originally drafted to address technological advances from that era. This post explores two complaints recently filed against banks for online banking  (Patco Construction Co. v. People’s United Bank (“PATCO”) and JM Test Systems, Inc. v. Capital One Bank (“JMT”)) and a court’s ruling on a motion for summary judgment in similar lawsuit (Shames-Yeakel v. Citizens Bank Memo and Memo Order on Motion for Summary Judgment – “Shames-Yeakel” case).  In short, since the Shames-Yeakel case proceeded past the “damages” pleading phase, it (and possibly these other online breach suits) reveals how some courts view security “standards” and approach the question of whether a company has achieved “reasonable security.”  I also believe they demonstrate the difficulty defendants face if they have to defend their security measures in a litigation context after a security breach.

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Let us say, speaking hypothetically, that a grossly negligent individual (who, since we are speaking hypothetically, is named…”Mr. X”) has accidentally uninstalled my favorite computer game, “Sid Meyers Civilization IV” (for which, by the way, I paid good money and patiently waited three whole hypothetical hours to legally download onto my computer).

 Let us further hypothesize that I was twelve hours into a very successful game which has now gone the way of the passenger pigeon. Is the loss of my computer software considered “damage to property” for the purpose of a negligence action, or is it just a form of pure economic loss? “Of course it’s property damage!” I thought to myself, “and a most egregious form at that!”

Yet, in law, as in life, few things are certain. I was compelled to learn more, and so I conducted a brief review of the case law from Canada, the United States and Australia to satisfy my curiosity. What I have learned is that, notwithstanding that we live in the age of the internet, it is far from clear whether we can sue for the loss of electronic data in a negligence action.

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We all know that it’s illegal to download and distribute copyrighted digital music without paying for it. But can this sort of file sharing ever constitute “Fair Use”? Why or why not?

Last Monday, as part of our feature on the Top 10 Cyber Law Cases Pending Before Courts Today, we discussed The File Sharing Trials. We mentioned that on December 7, 2009, Judge Gertner of the District Court of Massachusetts issued a decision in Sony BMG Music v. Tenenbaum which considered whether a college student’s sharing of digital music for the personal enjoyment of himself and his friends constituted “fair use” of the copyrighted songs. The decision can be viewed Here.

Here’s a quick recap of the facts:  the defendant, Joel Tenenbaum, was a college sophomore who was accused of using file-sharing programs like KaZaA to download and distribute 30 copyrighted songs. Tenenbaum’s file sharing was not for profit; it was for his own private enjoyment and that of his friends. He had downloaded songs, but not entire albums of music, and he did not make any changes to the music (i.e., turn them into his own creative work). Unfortunately, he had continued to file share notwithstanding changes in the case law which made it clear that his conduct was not protected, and after digital music was lawfully available (the iTunes Music Store debuted in April 2003, approximately 15 months before Tenenbaum’s computer was detected on the Kazaa network). Justice Gertner concluded that “fair use” was not a defence. Here’s why.

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