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NBA ref sues AP reporter for libelous tweet

On April 28, 2011, in Defamation, Social Networking, United States, by Jorge Espinosa

It was only a matter of time before we started to see libel suits involving tweets.  Tweeting, which involves 140 character messages exchanged on a distributed network run by Twitter, Inc., has become a ubiquitous from of communications for many.  Once a message is twitted, others who receive it can propagate the message by “re-tweetting.”

News organizations have become frequent users of Twitter as part of their strategy to connect with the readers and to build interest in their news reports.   This has led to an interesting lawsuit for an associated press reporter.

In  Spooner v. The Associated Press et al. (U.S. Dist. Ct-Minneapolis-Court File No.0:11-cv-00642-JRT -JJK), NBA Referee Bill Spooner alleges that during a Jan. 24 game between the Timberwolves and the Houston Rockets, he called a foul on a Minnesota player.   Minnesota coach Kurt Rambis disagreed with the call and engaged in a verbal exchange with Spooner.  Spooner allegedly promised to review the call at the half, but Rambis  “asked him how he would get the points back.” According to Spooner, he did not respond to this question.   According to the complaint, however, associated press reporter Jon Krawczynski tweeted to his readers that  Spooner “ told Rambis he’d ‘get it back’ after a bad call. Then he made an even worse call on Rockets. That’s NBA officiating folks.” Spooner alleges that the tweet is defamatory and accuses him of game-fixing. He has demanded that the tweet be deleted and retracted and seeks “more than $75,000″ in damages.

Although it is not a direct issue in this suit, an interesting question is raised by the facts as to the liability which might be faced by those to “re-tweet” the original tweet.  A look on Twitter shows that Krawczynski’s tweet has been re-tweeted 29 times.  Each re-tweet is a republication of the libelous statement and could subject the re-tweeters for liability.  That, however, is a lawsuit for another day.  If you don’t want that other suit to be about you, be careful what you re-tweet.


President Obama calls for trusted online identification systems

On April 17, 2011, in Internet, Privacy, United States, by Jorge Espinosa

On Friday the Obama administration released the second draft version of the National Strategy for Trusted Identities in Cyberspace (“NSTIC”).  The trusted ID plan is part of the Obama administrations Cyberspace Policy Review, released in May 2009.  This new draft focuses the effort to create an online identification system on the private sector with the government serving in a coordinating capacity.

The press release emphasizes the importance of the Internet to commerce but also its “online fraud and identity theft, that harm consumers and cost billions of dollars each year.”  By making online transactions trustworthy “we will prevent costly crime, we will give businesses and consumers new confidence, and we will foster growth and untold innovation.”

Key elements of the trusted identification systems suggested by the strategy include the ability to opt into the system, different types of credential for different categories of access and preservation of an anonymous option.  The strategy promises benefits such as faster transaction processing, age restriction for content, easier smartphone transactions and enhance public safety.

Much criticism of the strategy has come from privacy advocates.  This latest draft emphasizes that identification systems will be optional and will not abolish anonymity.  At the announcement of the latest draft Commerce Secretary Gary Locke dismissed such worries as conspiracy theories.

Users finds no virtue in Myspace privacy

On April 16, 2011, in Litigation, Social Networking, United States, by Jorge Espinosa

Two Myspace users, Linda Virtue and Lily Castro, filed suit against Myspace in the Eastern District of New York, Virtue v. Myspace, Inc (Case No. 11-cv-1800), alleging violation of federal privacy law. The 13 count, 33 page complaint alleges breach of the Stored Data Communications Act, breach of contract, invasion of privacy and various other common law counts. The suit bases its claim on the Myspace practice of sending advertisers the user’s unique ID numbers when they click on ads. The unique ID’s can be tied to user’s personal profiles including their name, age and browsing history. The plaintiffs claim that Myspace does this after falsely assuring its users that they can restrict information disclosure.

Myspace, a social networking service operated by News Corp., was a predecessor to Facebook which has seen rapidly declining membership in recent years.

New privacy bill introduced in Congress

On April 14, 2011, in Congress, Privacy, United States, by Jorge Espinosa

Your company may soon face more regulations in how it gathers and maintains customer data online.  On Tuesday April 11, 2011, Sens. John Kerry (D) of Massachusetts and John McCain (R) of Arizona introduced a new bill titled the Commercial Privacy Bill of Rights Act of 2011.  If passed the bill would impose new responsibilities on companies to disclose what data is collected from online visitors to their sites and would entitle users to opt out.

The bill seems to be explicitly directed at re-advertisers.  It explicitly states that it will target companies that take information solely for the purpose of advertising, and will be more lenient towards companies that have “existing relationships with customers.” “The bill does not allow for the collection and sharing of private data by businesses that have no relationship to the consumer for purposes other than advertising and marketing,” McCain said in the joint statement with Kerry. “It is this practice that American consumers reject as an unreasonable invasion of privacy.”

An additional factor that is likely to be the object of scrutiny as the bill advances through congress is a requirement that data that is collected by adequately secured once it has been gathered.  The FTC would be empowered to publish rules setting forth security requirements.  This portion of the bill responds to growing consumer concerns at unauthorized personal information leaks in the news.


The Social Network settlement upheld on appeal

On April 12, 2011, in Litigation, Social Networking, United States, by Jorge Espinosa

The story of “The Social Network” jumps off the silver screen and back into the news.  On Monday April 11, 2011, a three-judge panel of the Ninth Circuit Court of Appeals ruled that the 2008 settlement deal between Mark Zuckerberg, founder of Facebook, and Olympic rowing twins Cameron and Tyler Winklevoss is valid and enforceable.

The appeal arises from a long series of events retold in the aboved named movie.  The Winklevoss twins hired Zuckerberg to help them develop a social networking site named ConnectU.  When Zuckerberg came out with Facebook the Winklevoss twins sued claiming that Zukerberg stole their idea.  In 2008, the parties agreed to a settlement whereby Facebook acquired all of the ConnectU stock in exchange for $20 million in cash and $45 million in Facebook stock, which was valued at $35.90 a share.

The Winklevosses and the third ConnectU co-founder, Divya Narendra, soon developed buyer’s remorse over the settlement and brought suit to challenge the settlement.  The challenge centered on two issues.  First, that the two page settlement agreement was not an enforceable because it is missing various terms usually and customarily found in such agreements.  Second, that Zuckerberg concealed valuation and other information necessary to properly assess the value of the settlement in violation of the Securities and Exchange Act of 1934.

After the District Court refused to throw out the settlement, Winklevosses and Narenda appealed.  On Monday the 9th Circuit Court of Appeals affirmed the lower court ruling.

In his opinion Chief Judge Alex Kozinski stated “[a]t some point, litigation must come to an end.  That point has now been reached.”  The Appellants, however, disagree and have already announced that they will file a petition for a rehearing en banc by the full 9th Circuit panel.

Does anyone else see a sequel in the making?


The Senate considers updating Internet privacy law

On April 10, 2011, in Cloud Computing, Congress, Privacy, United States, by Jorge Espinosa

On Wednesday April 6, 2011, the Senate Judiciary Committee met to discuss overhauling the Electronic Communications Privacy Act of 1986 (“ECPA”).  This law governs privacy related to data collection and electronic communications but is lacking in any provisions regarding new technologies and practices such as mobile phones, mobile hotspots, social networking and cloud computing.

At least one party opposed to changing the law is the Department of Justice. (“DOJ”)  James A. Baker, associate deputy attorney general for the DOJ, told the committee that “the government’s ability to access, review, analyze, and act promptly upon the communications of criminals that we acquire lawfully, as well as data pertaining to such communications, is vital to our mission to protect the public from terrorists, spies, organized criminals, kidnappers, and other malicious actors.”

Mr. Baker tried to persuade the panel that great government access to our private and corporate information actually provides for a more private environment.  “By authorizing law enforcement officers to obtain evidence from communications providers, ECPA enables the government to investigate and prosecute hackers, identity thieves, and other online criminals. Pursuant to ECPA, the government obtains evidence critical to prosecuting these privacy-related crimes.”

What solution does the DOJ offer?  Well, for the moment none, however, Cameron F. Kerry, general counsel for the U.S. Department of Commerce, told the committee that the departments of Commerce and the DOJ “have been working together to develop a specific set of legislative proposals.”  No suggested tie frame for these proposals was stated.

Senator Patrick Leahy, chairman of the committee, opening remarks at the hearing suggest that the committee might be deferential to the DOJ and DOC on these topics.


Money, money, money….

On April 10, 2011, in Cloud Computing, Investment, Technology, United States, by Jorge Espinosa

The money flowing into cloud computing seems to grow from year to year. This week alone several significant announcements portend substantial growth.

  • Dell, Inc., well known manufacturer and reseller of ms-dos based computers and laptops, announced that it plans to invest over $1 billion on cloud computing initiatives during the next fiscal year.  The bulk of the investment will be centered on building data centers that will provide customers with computer infrastructure services (IAAS).  Dell announced 12 new such data centers this coming year with more to follow.  The data centers will be built worldwide.  Dell will brand some of their new data centers as vStart.  vStart data centers are planned to allow customers simple virtualized system environments.  According ton Dell, up to 200 virtual machines for a single customer.  These environments will be created in cooperation with VMWare.
  • Microsoft Corporation and Toyota Media Service Co. are working together to tie your car to the Internet. The initial goal is to provide power-savings tools for hybrid cars such as tracking the best time of day to charge the car, avoiding peak hours and higher electricity costs. The remote control system might also be extended to the home allowing the user to turn on air conditioning automatically or control energy systems at home remotely. The system is expected to be controllable via smartphones.  A presenter for Toyota predicted that consumers will soon learn to demand Internet connectivity for their cards.
  • On April 6 IBM announced two new products: Smartcloud and Workload Deployer.  Smartcloud is an IBM managed online cloud infrastructure for enterprises to host environments on the Internet.  One option under Smartcloud are IBM SAP Managed Application Services which will allow cloud based SAP solutions for customers.  Workload Deployer is an appliance for developing private corporate clouds.
  • Forbes interviewed David Eiswert, manager of T.Rowe Price’s Global Technology Fund, who was quoted as staying “Intel is virtually doubling their capital expenditure this year. And they’re not doing that because PCs are flying off the shelves.”


Cloud Law

On April 4, 2011, in Cloud Computing, Internet, Social Networking, United States, by Jorge Espinosa

Welcome to LexNimbus.  It is ironic that a blog dedicated to one of the most cutting edge areas of law should be named in an ancient language.  However, the irony is not without historical justification.  This blog is about how the law faces rapidly changing paradigms.  In much the same way Rome faced such changes in paradigm over the centuries.  From republic, to empire, to christianity, to division and ultimately to transformation into the gothic kingdoms that followed.  Today the Internet is undergoing similar revolutions and changes in a matter of a few brief years.

Individuals and corporations wishing to do business on the Internet are faced with an often unpredictable and unclear legal landscape.  LexNimbus tries to shed line on this landscape in order to help you discern the direction of change.  I hope that you will find this blog useful and welcome all of your comments and suggestions.