Legal Pad

Facebook GC Cleans Up Nice, Talks About Online Privacy

Famous general counsel gathered to discuss the issues of the day at GC West at the Fairmont Hotel, an event put on by our beneficent corporate parent ALM. Relatively new Facebook GC and former Bush White House lawyer Ted Ullyot, looking remarkably un-Facebooky in a crisp jacket shirt and tie and impeccably combed hair, was there to talk about Internet privacy. Facebook, of course has faced its share of privacy “challenges,” including the infamous targeted advertising program Beacon that creeped everyone out and led to litigation and a settlement.

But Ullyot said that non-Internet companies are more likely to get in trouble with privacy these days. He spoke at length about the FTC case against Sears (yes, the company that sells you washing machines) for spying on customers' Internet surfing with a software download. Ullyot explained that although users agreed to the terms and conditions, the box where they could be read was only big enough for 10 lines and the clause about spying was somewhere around line 73.

At this point, James Basile, a fellow panelist and former colleague of Ullyot’s at Kirkland & Ellis, jumped in to say that although the Sears case was widely publicized, the FTC is actually quite active in cracking down on companies that are invading the privacy of web surfers. Comparing the FTC to Tony Soprano, who quietly comes around demanding payment, he said these enforcement efforts rarely reach the public.

— Zusha Elinson

Anything You Tweet Can Be Held Against You In Court ...

Should lawyers be able to gather ammunition for litigation from social networking sites?

In one case cited by organizers of a social networking conference at the Samuelson Law, Technology & Public Policy Clinic at UC-Berkeley last Friday, a judge cracked down on a drunk driver whose passenger died in a crash after the woman’s MySpace page featured pictures of her in an outfit with shot glasses and an ad for booze. The judge sentenced the woman to five years in prison, saying the pictures showed she wasn’t remorseful, according to her lawyer.

To the surprise of some of the academics at the conference, Santa Clara Superior Court Judge Kurt Kumli said he and others on his panel came to the general consensus that the criminal justice system at the state and federal levels admits social networking evidence.

Restraining orders: No coming within 500 pixels of my Facebook wall ... after the jump.

Sheriff's Craigslist Smut Suit Snuffed

Law-and-order Midwestern sheriff Tom Dart thinks the Internet is to blame for prostitution,* so he sued Craigslist to halt its flesh-peddling “erotic services” ads. But as we so sagely predicted, the earnest peace officer’s lawsuit had a snowball’s chance in hell of surviving the scrutiny of any self-respecting judge who knows that Web sites aren’t liable for what their users post online. And indeed, Illinois Judge John Grady was the warm hell to Dart’s snowball of a lawsuit, as he dismissed the case on summary judgment Tuesday. Judge Grady said that Sheriff Dart really can't hold Craigslist responsible for the ads, comparing it to a case decided by the Seventh Circuit, Chicago Lawyers' Committee for Civil Rights Under Law Inc. v. Craigslist Inc., which found Craigslist wasn't liable for housing ads that discriminated against minorities:

Sheriff Dart’s lengthy complaint relies heavily on a few conclusory allegations to support the contention that Craigslist induces users to post ads for illegal services. Even at this stage of the case we are not required to accept those allegations at face value, and they are not meaningfully different from the allegations that our Court of Appeals rejected just last year. The complaint’s remaining allegations plainly treat Craigslist as the publisher or speaker of information created by its users. Like the plaintiff in Chicago Lawyers, Sheriff Dart may continue to use Craigslist’s website to identify and pursue individuals who post allegedly unlawful content.

Although the good sheriff lost the legal battle, he did get Craigslist to scale back its rampant sale of sex just a little. Next project: End old age by suing the AARP.

— Zusha Elinson

* Does that mean Al Gore invented hookers?

EFF Fights Google Book Plan Over Privacy, Not Antitrust

While most people chiming in on the Google Books settlement by the Tuesday deadline are concerned the Google’s potential dominance in digital books, a handful of organizations have launched an attack on the Internet giant’s handling of privacy for readers of its digitized books. Basically they say readers won’t have any.

Google says in its recently released privacy policy that it can use cookies, IP addresses, software or hardware to track what people read, how long they read it for, and where they read it, all to better target advertising to them.

The Electronic Frontier Foundation filed an objection (Download EFF's objection) Tuesday to the settlement on behalf of authors who write about non-mainstream topics like drug legalization, homosexuality, erotica or overthrowing governments.

“A digital books future where readers are going to be tracked is a digital books future where people will be afraid to read books on sensitive subjects,” said the EFF’s legal director Cindy Cohn.

Chill with us, after the jump.

Amazon.com wins ironic patent lawsuit against Cordance

Last month, we wrote about how Amazon was defending itself against a patent on one-click ordering (click here once —  oh no are we infringing too? —– to read the story). It was funny because ten years ago Amazon had threatened the world with its own patent on one-click ordering. The tech world was pissed because they said clicking once to order a damn book didn’t really count as an invention. And it so outraged everyone when they sued Barnes & Noble with their one-click patent in 1999 that a tech industry guru put a bounty on the one-click patent’s head if someone could invalidate it.

So everyone had a laugh when Amazon got a little patent karma with Cordance’s lawsuit. But look who’s laughing now: Amazon’s lawyer Fenwick & West partner Lynn Passahow convinced a Delaware jury earlier this week that Amazon didn’t infringe on Cordance’s one-click patent, Bloomberg reported. Cordance had been looking for more than $84 million in damages. Bloomberg reports that Passahow argued that “one of the patents wasn’t infringed because Amazon uses one-click ordering, while the patent is for a system involving two clicks.” Looks like the Fenwick lawyer clicked with the jury.

— Zusha Elinson

Apple Board Shakeup Surprises Someone, but Not Lawyers

So when is Parker Brothers going to rename Park Place Google Place, and Boardwalk Applewalk, right?

In your latest Silicon Valley monopoly update, Google CEO Eric Schmidt steps off the Apple board under heat from antitrust regulators. The FTC had been probing whether Schmidt’s role on the board violated the rarely-enforced section 8 of the Clayton Act, which prohibits competitors from sitting on each other’s boards. That’s to prevent them from fixing prices or dividing up the market.

At first Schmidt was defiant, saying Google and Apple’s products didn’t overlap enough for the two to be competitors. But with the introduction of Chrome OS, Google’s new operating system, the two now compete on phones (iPhone and Google Android) on browsers (Chrome and Safari) and operating systems.

Legal Pad called up Sam Miller, the veteran antitrust lawyer at Sidley Austin, to get his take. The only thing that surprised Miller about the resignation was that it didn’t come sooner.

We are shocked, shocked to find the appearance of conflict … after the jump.

Antitrust Problems For Microhoo? Either Way, Google Says 'Bring it On'

Yahoo and Microsoft finally hooked up, like two aging singles after years of on-again off-again flirting. They announced a 10-year search and online ad deal this morning.

The question for armchair lawyers is: Will the government's more trigger-happy antitrust regulators do anything to stop it?

Legal Pad called up Bob Lande, the co-founder of the American Antitrust Institute. Lande said that normally when the second and third leading players in an industry combine like this, regulators jump on the deal. But because both Yahoo and Microsoft are so far behind the top dog, Google, in search advertising, Lande said it shouldn't be a big issue.

"Their basic argument — letting two little guys compete with Google — is a good one," said Lande, who often urges regulators to scrutinize deals. "Normally number two and three cannot merge unless you’re facing a colossus like this one."

Others beg to differ, after the jump.

Google: We Are So Not Antitrusty, Dude.

Dana Wagner, Google’s most antitrustworthy lawyer.

There’s an interesting debate going on between the editor of Wired and Google’s top antitrust lawyer on this question: is free an antitrust problem?

Wired’s Chris Anderson wrote a column saying that all those things Google gives away for free — search, gmail, maps, directory assistance, new cars — should raise antitrust concerns. How’s that? Anderson argues that because of Google’s dominance in the search advertising market, it can subsidize other products and drive competitors out of the market by offering them for free. It’s like the predatory pricing of the big bad Japanese chipmakers in the days of yore, he writes:

The analogy is something like the semiconductor battles of the 1980s, when Japanese companies were accused of "dumping" (selling for under cost) memory chips in the U.S. market to drive out U.S. competitors.

Google’s antitrust gunslinger responds, then we go to a neutral expert.

Facebook CEO Spied With 'Patent Vampire'

The patent paparazzi have arrived!

Silicon Valley gossip rag Valleywag got a nice picture of bratty Facebook CEO Mark Zuckerberg being chatted up by what it refers to as a "patent vampire" — Nathan Myhrvold, he of the ominous and secretive patent-hoarding company Intellectual Ventures.

Feared in Silicon Valley (and not just because his name sounds like he’s a Harry Potter villain), Myhrvold’s company has extracted huge licensing deals from tech companies, including this $120 million one from Intuit in May. So what’re Myhrvold and Zuckerberg up to, besides smiling and oddly sipping on Diet Cokes? We’re guessing that Myhvold has a few patents that the Zuckster's company infringes on …is he making an offer that the Facebook Kid can’t refuse?

— Zusha Elinson

DOJ Quietly Turns Its Eye Toward Google's Books Thingy

Dana Wagner, Google's top antitrust lawyer.

In case you missed it Thursday as you hurried out of the office to purchase your illegal fireworks, the Department of Justice finally confirmed that it’s probing the Google books settlement.

In a letter to New York Judge Denny Chin, the DOJ wrote that it has reviewed public complaints that a settlement allowing Google to digitize millions of books gives the search engine a monopoly on so-called “orphan works.” Those are the books where the copyright owners can’t be found or died a sad, childless death. Even though they obviously weren’t at the table, they were included in the $125 million settlement in the copyright infringement lawsuit filed by authors and publishers against Google. Critics like San Francisco’s own Internet Archive raised a stink earlier this year, pointing out that Google’s unique immunity from any potential lawsuits from the owners of orphan works is a barrier to entry for any other Web site that might want to digitize orphan works.

Google's antitrust chessmaster versus orphans, after the jump.