Information Today
Volume 19, Issue 3 — March 2002
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• Legal Issues •
Circumvention, Cybersquatting, and Groucho
Here's an update on some recent court rulings and pending legislation
by Stephanie C. Ardito

From time to time, I think it's important to provide a digest of noteworthy legal cases and legislation that have the potential to alter the way the information industry conducts its business. In this column, I'll furnish updates of the Sklyarov and American Library Association (ALA)/American Civil Liberties Union (ACLU) litigation, summarize a recent domain name adjudication, outline the draft of European Union legislation limiting the use of cookies to track Internet users, and convey a story about a "supposed" trademark infringement lawsuit from the 1940s.
 

Circumvention Technology
In the November 2001 issue of Information Today (p. 24 or http://www.infotoday.com/it/nov01/ardito.htm), I reported on the Dmitry Sklyarov case. Sklyarov, a Russian computer programmer, had been arrested by the FBI for developing software that circumvents encryption coding in the Adobe PDF and Adobe Acrobat eBook Reader software programs. On December 13, 2001, the U.S. Attorney's Office for the Northern District of California announced that Sklyarov would be released from custody, that all charges against him would be dismissed, and that he could return home. In exchange, Sklyarov "will be required to appear at trial and testify truthfully" in the ongoing prosecution of his employer, ElcomSoft (http://www.usdoj.gov/usao/can/press/html/2001_12_13_sklyarov.html).

In a press conference shortly after his release, Sklyarov told reporters that he still planned to work for ElcomSoft, contradicting information in the Northern District of California's press release that referred to ElcomSoft as Sklyarov's former employer. Hearings on various motions are scheduled for March 4 and April 1.

Ironically, within a few days of Sklyarov's release, Adobe Systems itself was charged with a software copyright infringement suit. The company was ordered by a U.S. District Court judge in Los Angeles to stop selling InDesign and other software owned by Trio Systems, LLC. Trio alleged that various Adobe software programs contain Trio software code, a violation of a licensing agreement between the two companies. Trio sought $10 million in damages, but within 2 days of the judge's order the case was settled out of court. Adobe is now permitted to sell products with Trio code.

Last month, my Legal Issues co-columnist George H. Pike reported on a related case (Universal City Studios, Inc., et al. v. Corley) in which various motion picture studios sought to ban software that circumvents DVD coding (p. 15). In that lawsuit, the court ruled that 2600 Magazine was prevented from publishing and linking to DeCSS, a free program that permits DVD viewing on players not approved by the film industry. The three-judge panel "rejected pleas [to dismiss the case] from 46 intellectual property professors, 17 top computer scientists, 8 top computer security experts, the Association for Computing Machinery, the American Library Association, the ACLU, and the Reporters Committee for Freedom of the Press, among many others" (http://www.eff.org/IP/Video/MPAA_DVD_cases/20020114_ny_eff_pr.html). 2600 Magazine is appealing the decision, and will base its continuing arguments on First Amendment free speech rights and protection.

Other circumvention cases are also being adjudicated. For example, the DVD Copy Control Association (DVD CCA), a nonprofit corporation that licenses a Content Scramble System (CSS) to DVD hardware and disk manufacturers, sued many individuals, including then-college-student Matthew Pavlovich for publishing DVD-decoding software. Pavlovich filed a motion with the California Sixth Appellate District to dismiss the case, arguing that his former residence in Indiana and current residence in Texas should excuse him from having to defend himself in California. The court denied the motion, maintaining that Pavlovich knew the movie business is located in California and that his decoding activities subject him to adjudication there.

A press release issued by the Electronic Frontier Foundation stated: "The U.S. Constitution's due process clause limits a state court's ability to assert power over out-of-state defendants who have no connection with that state. The Pavlovich case has already gone to the California Supreme Court once before; the Court sent the matter back to the Appellate Court to explain why it believed Pavlovich could be required to come to California. The Appellate Court again held that Pavlovich is required to defend himself in California. 'The lower court'sruling means that a person would be subject to jurisdiction everywhere the Internet reaches,' said Allonn Levy, who represents Pavlovich. 'It means that movie industry moguls can drag web publishers from anywhere in the world to defend themselves here in California'" (http://www.eff.org/IP/Video/DVDCCA_case/20020115_eff_pr.html).

In early January, Virginia congressman Rick Boucher announced his intention to introduce a bill that would eliminate the Digital Millennium Copyright Act's anti-circumvention clause (http://www.forbes.com/newswire/2002/01/07/rtr472387.html). Considering the power of the music, movie,and publishing industries, this is a development well worth watching.
 

Lawsuits Against CIPA
In the June 2001 issue (p. 14), I wrote about the Children's Internet Protection Act (CIPA) and the lawsuits filed against it by the ALA and ACLU. If CIPA is upheld in court, school and public libraries that refuse to institute Internet safety policies or install filtering technology risk losing federal funding. Last July, in response to a government motion to dismiss the lawsuit, ALA successfully defended its position to have its case heard (http://www.ala.org/cipa/alacipabrief.pdf). Although both cases have been consolidated and will be tried together, each organization will retain separate counsel. Originally scheduled for hearing on February 14, after a motion by the federal government the case was granted an extension to March 25.
 

Cybersquatting
Many of us are aware of individuals who register domain names in the hope of selling them for large amounts of money to companies that own the trademarks. In one case, Ford Motor Co. sued Great Domains (http://www.greatdomains.com), a company that auctions Internet domain names, and individuals who had registered such names as jaguarcenter.com and jaguarenthusiastsclub.com. jaguarcenter.com was developed by a 13-year-old British girl with a passion for the large cats, and jaguarenthusiastsclub.com is a site for car fans and hobbyists. Citing the 1999 Anticybersquatting Consumer Protection Act (ACPA), the Lanham Act (specifically sections regarding trademark infringement and unfair competition), and the Federal Trademark Dilution Act of 1995, Ford accused Great Domains and the individuals of trademark cyber-piracy.

On December 20, 2001, the U.S. District Court for the Eastern District of Michigan Southern Division "conclude(d) that neither registering, nor warehousing, nor trafficking in a domain name that incorporates a protected trademark is alone sufficient to support claims of trademark infringement or dilution. Both causes of action require use of a trademark in connection with goods or services, which, in the cybersquatting context, generally will require evidence that the domain was used to host a website from which goods or services have been offered over the Internet.... While Ford's ACPA claim may proceed, its infringement, unfair competition, and dilution claims must be dismissed" (http://www.mied.uscourts.gov/_opinions/cleland.htm). The court also rejected Ford's in rem claims of jurisdiction, in which the company attempted to try individuals living outside the U.S. in Michigan.
 

Cookies
Cookies are typically used by companies to track consumer preferences and advertising effectiveness. Consumers like cookies when they can utilize them to personalize Web pages and avoid registering to sites each time they're accessed. However, opponents of cookies fear that individuals' privacy is at risk when consumers haven't given explicit permission to allow their online movements to be tracked.

Late last year, the European Parliament, a legislative body empowered to create laws for the European Union, voted to draft legislation that would reduce spam and restrict cookies. In part, those responsible for the draft recognized that cookies "can be a legitimate and useful tool, for example, in analysing the effectiveness of web-site design and advertising, and in verifying the identity of users engaged in on-line transactions. Where such devices, for instance so-called cookies, are intended for a legitimate purpose, such as to facilitate the provision of information society services, their use should be allowed on condition that clear and precise prior information about the purposes of cookies or similar devices is provided by the operator of a website sending such devices or allowing third parties to send them via his website. The website operator should also give users the opportunity to accept or refuse that a cookie or similar device is stored on their terminal equipment. The modalities for giving information and requesting consent or offering a right to refuse should be as user friendly as possible. Access to specific website content may still be made conditional on the well-informed acceptance of a cookie or similar device, if it is used for a legitimate purpose" (http://register.consilium.eu.int/pdf/en/01/st14/14631en1.pdf).

Each member country of the European Union will have the option of enacting the legislation. Many analysts are convinced that country-by-country approval is years away, as lobbying activities by advertising groups and companies that rely on Internet advertising will delay implementation.
 

Marx Brothers v. Warner Brothers
In a slight departure from this column's emphasis on current legal issues, I'd like to pay a small tribute to my mother, Roberta Ardito. She was a voracious reader, clipping copyright and intellectual property articles and editorials that might warrant a more in-depth analysis or opinion. I would receive these newsworthy items in all kinds of disarray, as my mother was not a neat article clipper, and she had to be regularly reminded to include complete citations. She often encouraged me to write a lengthy piece about the comical aspects of copyright. For now, I'd like to share a favorite case of ours from the 1940s.

In 1946, when the Marx Brothers decided to film A Night in Casablanca, Warner Brothers (the producer of the 1942 Humphrey Bogart/Ingrid Bergman movie Casablanca) allegedly threatened to sue the Marx Brothers' studio for using the word "Casablanca" in the movie's title. There's controversy about whether Warner Brothers actually claimed trademark ownership of "Casablanca," or if Groucho Marx fabricated the confrontation between the two studios as a publicity stunt to stimulate interest in the Marx Brothers' movie. Whatever the truth, documented proof exists that the Warner Brothers' legal department was genuinely concerned about the content of A Night in Casablanca, worrying that it would parody the classic film and cause confusion among the viewing public. In response to inquiries by Warner Brothers, Groucho wrote a letter, which reads in part:

Apparently there is more than one way of conquering a city and holding it as your own. For example, up to the time that we contemplated making this picture, I had no idea that the city of Casablanca belonged exclusively to Warner Brothers. However, it was only a few days after our announcement appeared that we received your long, ominous legal document warning us not to use the name Casablanca.

It seems that in 1471, Ferdinand Balboa Warner, your great-great-grandfather, while looking for a shortcut to the city of Burbank, had stumbled on the shores of Africa and, raising his alpenstock (which he later turned in for a hundred shares of the common), named it Casablanca.

I just don't understand your attitude. Even if you plan on re-releasing your picture, I am sure that the average movie fan could learn in time to distinguish between Ingrid Bergman and Harpo. I don't know whether I could, but I certainly would like to try.

You claim you own Casablanca and that no one else can use that namewithout your permission. What about 'Warner Brothers'? Do you own that, too? You probably have the right to use the name Warner, but what about Brothers? Professionally, we were brothers long before you were. We were touring the sticks as the Marx Brothers when Vitaphone was still a gleam in the inventor's eye, and even before us there had been other brothers—the Smith Brothers; the Brothers Karamazov; Dan Brothers, an outfielder with Detroit; and 'Brother, Can You Spare a Dime?' (This was originally 'Brothers, Can You Spare a Dime?' but this was spreading a dime pretty thin, so they threw out one brother, gave all the money to the other one and whittled it down to, 'Brother, Can You Spare a Dime?').

Now Jack, how about you? Do you maintain that yours is an original name? Well, it's not. It was used long before you were born. Offhand, I can think of two Jacks—there was Jack of 'Jack and the Beanstalk,' and Jack the Ripper, who cut quite a figure in his day....

I have a hunch that this attempt to prevent us from using the title is the brainchild of some ferret-faced shyster, serving a brief apprenticeship in your legal department. I know the type well—hot out of law school, hungry for success and too ambitious to follow the natural laws of promotion. This bar sinister probably needled your attorneys ... into attempting to enjoin us. Well, he won't get away with it! We'll fight him to the highest court! No pasty-faced legal adventurer is going to cause bad blood between the Warners and the Marxes. We are all brothers under the skin and we'll remain friends till the last reel of 'A Night in Casablanca' goes tumbling over the spool (http://www.snopes2.com/movies/films/anightin.htm; http://www.progressive-options.com/humor/groucho.htm).
 
 

Stephanie C. Ardito is the principal of Ardito Information & Research, Inc., a full-service information firm based in Wilmington, Delaware. Her e-mail address is sardito@ardito.com.

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