Here is the webinar I gave last week entitled, "Affiliate Marketing - Do It Right to Avoid Legal Liability."  The webinar is divided into two parts, both of which are below.

You can find these (and other Technology Law-related videos by me) at www.YouTube.com/technologylaw

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Yesterday, a federal appeals court dealt a (legal) lethal blow to the FCC's effort to establish so-called "Net Neutrality" rules for the Internet. 

What does this mean for you? 

Well, on the positive side it means that the federal court stopped the overreaching efforts of the FCC (which loves to overreach).  On the negative side, it may soon cost you a few more bucks to access your favorite content on the Internet. 

All in all, it's not only a correct decision, its a darn good decision.  Why?  Because there is no statute, law, rule or regulation that permits the FCC to regulate how Internet service providers charge their customers for broadband service.  Simply put: the FCC can't (and shouldn't try to) regulate things that it's not authorized to regulate. 

Want some history?  Read on....

It all started back in 2007, when subscribers to Comcast's high-speed Internet service suspected that Comcast was downgrading the amount of broadband service it made available to users of peer-to-peer applications.  (What's a peer-to-peer application?  Think, Napster.  BitTorrent.  Windows Meeting Space. Gnutella.)

At first, Comcast denied the issue entirely.  Later, after reality set in and Comcast couldn't deny it any longer, Comcast confessed to the activity but defended its actions as necessary to manage its scare network capacity.

Enter the FCC.  The FCC claimed that Comcast's activity violated the FCC's Internet Policy Statement, which had been issued approximately two years earlier, and which stated that "consumers are entitled to access the lawful Internet of their choice . . . [and] to run applications and use services of their choice."

        [Editor's Note / Opinion]: Did Comcast's activity actually violate the FCC's 
                                                   Internet Policy Statement?  I didn't think so... but they're
                                                   the FCC, and I'm not.  But I digress....let's continue....

The FCC invited the public to chime in and give its thoughts on the issue.  By and large the public overwhelmingly supported the FCC's position.  Both print and electronic news organizations heavily peppered their coverage of the issue with the mantra of "net neutrality".  Whenever the issue came up, it was almost always framed as the "big bad cable companies" vs. middle or urban America.  (It really wasn't a fair way to frame the issue, but it made the whole thing sound ripe with controversy, and it definitely helped sell newspapers....)

Eventually, the FCC issued a formal order that (i) the FCC had the right to opine on the issue and sanction Comcast, and (ii) Comcast's activity violated the FCC's Internet Policy Statement.

Comcast appealed the FCC's order, claiming that the FCC had absolutely no right to meddle in Comcast's network management practices.

The result?  The United States Court of Appeals for the District of Columbia Circuit agreed with Comcast, and struck down the FCC's attempt to control how Comcast handled its customer broadband issues.  You can read the decision HERE.

In sum, the Court reiterated the age-old rule of law that administrative agencies, such as the FCC, can act only pursuant to authority delegated to them by Congress.  Since Congress never granted the FCC the right to interfere in Comcast's network management practices, the Court found that the FCC should have stayed out of the issue altogether. 

CHUTZPA  ALERT:  Want to laugh?  Here's the ultimate chutzpa by the FCC: realizing that it had no statutory authority to do what it did, the FCC tried to argue that "congressional policy by itself creates 'statutorily mandated responsibilities' sufficient to support" the FCC's actions.

What the heck does that mean in everyday, non-lawyer English?  Here's the translation:  "Judge, we're the FCC.  We do so much stuff with regard to the Internet, we should be allowed to do this too.  Never mind the fact that we have no authority to do this.  Don't think about that.  Think Government.  Think Regulation. (Cue the patriotic music here.)  Did we mention that we're the FCC???"

For now, the case is closed—unless, of course, the Supreme Court elects to hear the case on appeal.  (But it won't, so don't hold your breath waiting for that to happen....) 

A final thought: despite my lambasting of the FCC, I think that Net Neutrality is a good thing, and should be implemented by ISPs.  It's good for communities, large and small, wealthy and poor.  Net neutrality can help poorer areas leverage the power of the Internet.  Net neutrality helps foster innovation and competition online. 

But if you want true net neutrality, it has to be implemented (i) by the ISPs themselves, letting market forces determine the outcome of it all, or (ii) by federal law, which currently doesn't exist in this area.  Any other attempt to force net neutrality on ISPs is simply wrong. 

      

Are you sharing your customers' information with your company's affiliates? 

Are you sure you know what an "affiliate" is?  Watch the video, and keep your company out of court!!





(Text):  Hi, and welcome to the Business Technology Law video-blog update for the week of March 21, 2010. You know, a lot of comppanies are out there sharing their customers' information with their so-called "affiliates". Today ... << MORE >>

The next time you casually click that "I Accept" button online, you may be biting off more legal liability than you ever thought you'd have to chew.  Such was the case for Flowbee, the maker of the famous vacuum haircutting device, when its lawsuit against Google got bounced out of court because of four seemingly innocuous words tucked neatly into a forum selection provision in a Google adword contract.     

Now, we've seen (and discussed) lots of forum selection cases before.  But what makes the Flowbee case so special is the fact that the issues in Flowbee's lawsuit had nothing to do with the Google adword agreement!  Instead, it was four simple words, stashed in the middle of a forum selection clause, that caused the court to apply the terms of the adword contract to other (unrelated!) matters between the parties.  Read on....

Flowbee, maker of the famous vacuum haircutting device, had a problem: Google was allowing Flowbee’s competitors to purchase the word “Flowbee” as a Google adword.  This meant that when a person performed a Google search for the word “Flowbee”, Flowbee’s competitors’ sites would appear on the screen.  Not a good thing—if you’re Flowbee.

Then, two important things occurred…now follow me here because it gets confusing.  First, Flowbee demanded that Google stop allowing others to purchase the word “Flowbee” as a Google adword—a  request that was flatly refused by Google.  Second, Flowbee entered into its own adword program agreement with Google (presumably under the theory of “if you can’t beat ‘em, join ‘em").

Ok, here’s where it gets riveting (at least it does for me): the adword agreement between Flowbee and Google had a forum selection clause that said, “All claims arising out of or relating to this agreement or the Google Program(s) shall be litigated exclusively in . . . California.” 

Why is that riveting?  Hang on….

Flowbee then sued Google in Texas for trademark infringement, based on Google’s sale of the adword “Flowbee” to Flowbee's competitors.  Google asked the court to dismiss the case, and the court pleadings went something like this:

Google: “Hey Judge, Flowbee has to come to California because that’s what the forum selection clause says in the adword agreement.  See, it says right here, 'All claims must be settled in California.' ”

Flowbee: "Judge, the forum selection clause has nothing to do with this dispute.  We are suing over trademark infringement for things that pre-date the adword agreement.  Google's act of selling the word 'Flowbee' to our competitors is unrelated to our side advertising deal with Google." 

The court's ruling went something like this:

Court:  "Google wins.  Even though the forum selection clause was in the Google adword agreement, it specifically says that it applies to the adword agreement AND any other dispute that Flowbee has with Google." 

Hold the phone!!  Can that be true?  Can a provision in an agreement bind the parties on issues that are unrelated to that agreement?  Answer: YES!

Now let’s take a closer look at that forum selection clause.  Remember it said, "All claims arising out of or relating to this agreement or the Google Program(s) shall be litigated exclusively in . . . California."  See the words in bold print (which, of course, were not in bold print when Flowbee inked its deal with Google)?

In plain English, the words in bold print cause the entire provision to mean, "If you want to sue Google over this agreement or any other issue that concerns Google, you need to come to California to do it."

Sneaky draftsmanship?  Perhaps.  But enforceable nonetheless.

So what's lesson of the Flowbee case?  It is simply this: be careful of the "fine print" in boilerplate-type provisions such as forum selection clauses.  If a contract provision refers to another unrelated document or issue, then ask questions before signing (or clicking, as the case may be) on the dotted line.

 

      

Six years ago, a series of decisions, called the "Zubulake decisions" were handed down by Judge Scheindlin of the Federal Court for the Southern District of New York. No decisions have ever been more important and relevant to what companies can and can not do with electronic documents in the context of litigation. That is, until now.

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If you've been keeping up with the No Fault Found Syndrome that I've written about many times in the past, then there's a video out there you should see....more on that in a moment.

(If you haven't read my prior blog entries about No Fault Found, feel free to read them HERE.) 

Briefly, No Fault Found ("NFF") occurs when (according to Wikipedia) "an originally reported mode of ... << MORE >>

Ever wonder if you can get pulled into court in a foreign state or locale based on something that occurs through your company's website? 

Short answer: you can.... sometimes.

But now I'm going to give you, my faithful readers, the opportunity to "make the call" on this issue. What follows are real facts, from a real case that was just handed down by a federal court. 

You be the judge, and let me know (by commenting ...

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Two cases involving click-wrap agreements were decided in the past few weeks—with very different outcomes. Both cases involved Web-based purchases in which consumers agreed to certain online "terms and conditions."  In both cases, the online terms of sale contained forum selection provisions (a/k/a "if you sue us, you need to sue us in our state and you must do it our way" clauses).

But in one case, a court refused to ...

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For the first time, the Supreme Court of the United States will consider how much Constitutional protection text messages are entitled to receive. And thank goodness for that, since the Ninth Circuit just handed down a ruling that is not only wrong, but calls into question 25 years of case law. << MORE >>

Comcast has agreed to pay $16 million to settle a peer-to-peer "throttling" lawsuit. The lawsuit was one of seven suits filed against Comcast, all of which alleged that Comcast slowed or impeded peer-to-peer (a/k/a "P2P") transmissions sent using Comcast's broadband high-speed Internet service without telling its subscribers—despite the fact that Comcast advertised "unfettered" access to P2P networks.<< MORE >>