The adult entertainment industry is responsible for bringing many of the seminal cases that have shaped intellectual property law on the Internet, from Playboy Enterprises Inc. giving rise to the "initial interest confusion" test for trademark infringement, to Perfect 10 shaping the contours of search engine liability. And now a company named Eros LLC is seeking to join their ranks. Second Life is perhaps the most closely observed virtual world in the United States. Eros claims to be one of the most successful merchants doing business within Second Life, selling adult-themed virtual assets. In an Amended Complaint filed at the end of October in the United States District Court for the Middle District of Florida, Eros claims that the named defendant (and unnamed John Does) has been making and selling numerous unauthorized copies of the virtual assets to other Second Life residents in violation of Eros's exclusive rights under copyright. If this were the "real" world, the Eros lawsuit would be an uneventful case of software piracy and reverse passing off. But this isn't the "real" world; all of the activities giving rise to this lawsuit occurred in Second Life. As such, its implications are worth noting. The following article by Ben Mulcahy was originally published in The National Law Journal.
Can search engines and credit card companies be secondarily liable?
Two recent Ninth Circuit decisions regarding Perfect 10, Inc., a Web site that markets copyrighted images of nude models, lay bare the issues facing plaintiffs asserting third-party copyright and trademark claims, and highlight differences between how the Ninth and Second Circuits might decide these claims. The two decisions, rendered within months of one another, address liability against search engines and credit card companies.
User generated content ("UGC") is the interactive marketing and promotion industry's fixation du jour. And for good reason - UGC is being monetized on the Internet in various ways, from building multi-billion dollar valuations for social networking sites to driving consumer awareness of and enthusiasm for such products as Mentos candy and the next music single from Shakira. Other than the filters that users self-impose upon themselves, little stands in the way between users and the type of UGC that they post online in the first instance. As a result, UGC is rarely cleared for legal purposes before it is posted for the whole world to see, and a lot of UGC consists of content lifted wholesale from television shows or content that otherwise infringes upon the rights of third parties.
That reality has prompted content owners to bring several high-profile lawsuits against social networking sites and other website operators whose users have posted allegedly infringing UGC. As more websites allow users to post content to discussion boards, create assets in virtual worlds, post profiles on social networking and dating sites, or participate in UGC promotions, the number of lawsuits alleging defamation type claims and intellectual property claims (e.g., copyright, trademark, publicity, trade secrets) can be expected to multiply. Recent court decisions interpreting the Communications Decency Act ("CDA") and the Digital Millennium Copyright Act ("DMCA") are helping draw the lines between when the website operators can rest easy, and when they can't.Continue Reading...
David Carruthers, a resident of Costa Rica and England, was taken into custody this past July during a flight layover in Texas. His alleged crime? Being the CEO of BetonSports PLC, which operates BetonSports.com, an online gambling Web site based out of Costa Rica and Antigua. For that offense, a federal grand jury returned a 22-count indictment charging Mr. Carruthers, BetonSports PLC, and others with racketeering, conspiracy and fraud.
This article by Ben Mulcahy was originally published in the New York Law Journal. To read the article please click here, or visit the New Yprk Law Journal website.