<-- The Filter --> September 2000

September 8, 2000
No. 3.6  .  The Filter  .  9.08.00

Your regular dose of public interest Internet news and commentary from
the Berkman Center for Internet & Society at Harvard Law School


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> The (Music Industry) Empire Strikes Back: Not long ago, MP3.com CEO Michael Robertson was making headlines with his firmly defiant stance toward a copyright infringement suit brought against the company by the Recording Industry Association of America. "Your argument is that technology companies cannot facilitate [fair] use," wrote Robertson in an open letter to RIAA head Hilary Rosen, "[...] you apparently believe that you have the right to control the content even after the user buys it. We disagree." When MP3.com was subsequently found liable by Judge Jed Rakoff for infringement, however, a chastened Robertson was quick to pursue licensing agreements with the RIAA-associated corporate plaintiffs, and he succeeded in striking deals with all but one: Seagram's Universal Music Group. Now, after finding that MP3.com willfully infringed copyright by copying CDs to its online my.mp3.com "lockers," Judge Rakoff has levied fines of $25,000 per CD in damages to UMG—a ruling that could cost MP3.com an estimated $118 million. "Some companies operating in the area of the Internet may have a misconception that, because their technology is somewhat novel, they are somehow immune from the ordinary applications of laws of the United States, including copyright law," said Judge Rakoff. "They need to understand that the law's domain knows no such limits."



> Don't Get Mad, Get Lawyers: The next legal battle in the ongoing war between the film and music industries and Internet companies that provide peer-to-peer file-swapping services may be over before it reaches the courts. Napster-like Scour Inc., hit two months ago with a copyright infringement suit by a group of industry organizations including the Motion Picture Association of America, announced last week the layoff of fully two-thirds of its staff. The company, whose backers include former Disney executive Michael Ovitz, failed to attract additional funding in the face of escalating legal expenses—including fees for a defense "dream team" that counts among its members Berkman Center Co-Director Arthur Miller. (Miller has in the past represented publishing interests, as in his amicus brief in the Eldred v. Reno case.) While Scour remains optimistic about its future, investors are likely to steer clear of the company until they're reasonably certain it will survive litigation—something that, particularly in light of this week's MP3.com ruling, is increasingly difficult to gauge.

      http://n ews.cnet.com/news/0-1005-200-2686570.html


> To Innovate or to Litigate, That is the Question: With the recent spate of court victories maintaining a profitable status quo for the film and music industries, do they have a motive to adapt rather than stamp out new technologies? Follow the link below for an insightful New York Times article on the traditional response by established industries to technological innovation—and how that response plays out over time.

      http://www .nytimes.com/library/tech/00/09/biztech/articles/02napster.html

> Online Privacy—Going Once, Going Twice: When bankrupt e-tailer ToysMart.com took steps in June to sell off personal data it collected from Internet users under a privacy policy stating that the information would "never" be shared or sold, the ensuing public outcry resulted in swift action by the Federal Trade Commission. Slapped with a suit alleging unfair and deceptive business practices, ToysMart worked with the FTC to reach an out-of-court settlement, finally agreeing not to transfer the data in question to another company unless the company operated under ToysMart's original privacy policy. Now, in the wake of a decision by the Massachusetts Bankruptcy Court overseeing the ToysMart case not to consider its agreement with the FTC in the absence of a buyer for ToysMart's assets, leading e-tailer Amazon.com has introduced modifications to its privacy policy making it clear that Amazon customers' personal data is considered a company asset and can therefore legitimately be shared with Amazon's growing cadre of corporate partners—or, if need be, be sold.

      http://dailynews.y ahoo.com/h/ap/20000901/tc/amazon_privacy_2.html

      http://www.techweb.com/wire/story /TWB20000903S0001

      http://www.ny times.com/library/tech/00/08/biztech/articles/18toys.html

In addition to alerting customers to the fact that their data is a company asset, Amazon removed from its policy the option for customers to opt out entirely of sharing their data with a third party—although they can still opt out of uses that fall outside the broad categories Amazon's policy outlines. Despite raising a red flag for privacy advocates, the move is perfectly legal. "The core of our case in ToysMart was their privacy policy," FTC spokesman Eric London told the Associated Press. "The deception arose from the fact that their privacy policy said they would never share the information."

***EXTRA: As this issue of The Filter was prepared for release, both House and Senate committees held hearings to debate privacy legislation, with Internet pioneer Vint Cerf and others stepping forward to testify. We would like to hear from you. Should Congress enact federal legislation to establish a baseline legal standard for how Internet users' personal data is handled? Write a letter to the editor at filter-editor@cyber.harvard.edu and let us know what you think. We will publish readers' responses in a forthcoming release.

> Simon Says Award Me $ 26.8 Million: Much ado in recent months has been made of trademark disputes over domain names, with decisions made by the World Intellectual Property Organization under ICANN's Uniform Dispute Resolution Policy coming under attack by public interest groups for favoring corporate trademark holders. Now—giving new meaning to the phrase "rooting for the home team"—a jury verdict in Indianapolis, IN awarded local shopping mall developer Simon Property Group $26.8 million in damages as part of a trademark infringement lawsuit against mySimon.com, a provider of online comparison shopping services. "Unless Simon can point to shopping malls failing as a result or millions in Internet revenue lost, I can't see that standing up," says Berkman Fellow Diane Cabell, who sees the verdict as a preemptive "bricks against clicks" strike. "I think an appeals court would look at that very, very, very closely."

      http://www.computeruser.com/ne ws/00/09/04/news11.html

      http://www.starnews.com/bus iness/articles/simon0902.html

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This week we're featuring "The Heavenly Jukebox," a thoughtful Atlantic Monthly piece exploring the impact of emerging digital distribution technologies on the music industry:

      http://www.theatlantic.com/issues /2000/09/mann.htm

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> Berkman Center Opens Clinical Program in Cyberlaw: Operating in conjunction with Internet-related courses taught by Berkman Center-affiliated faculty, the Berkman Center's newly-established clinical program will offer practical experience to second-and third-year Harvard Law School students. In addition to supporting both virtual and physical externships, it will include a Cyberlaw Research Bureau, where students can opt for short-term placement on specific tasks, such as the preparation of an amicus brief.

We're also testing a mentor component of the program, inviting skilled practitioners who wish to learn more about the novel Internet issues in their area of susbstantive expertise to team up with a student in Professor Jonathan Zittrain's "Internet & Society 2000" course. In exchange for auditing the class via the Internet for free, mentors will act as an advisor on his/her student's required course paper. Both student and mentor stand to benefit considerably.

Click on the links below to learn more about the program and to visit Professor Zittrain's "Internet & Society 2000" course site:



> Get Ready for eDevelopment: The Berkman Center, the Center for International Development at Harvard's Kennedy School of Government, and the Media Lab at MIT are proud to announce "eDevelopment," an upcoming conference to address issues surrounding the digital divide from a multidisciplinary perspective. What technologies should be prioritized by transitional economies, and what costs are reasonable? Mark your calendars for the Friday, October 20 session, which is free and open to the public and will be held in Ames Courtroom in Austin Hall on the Harvard Law School campus in Cambridge. Futher details—including how to access the live webcast—will follow in Filter 3.7.

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* Opt Out—Get Off the Lists


The Center for Democracy & Technology's one-stop resource site to enable Internet users to opt out of online profiling.

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"We will develop technology that transcends the individual user. We will firewall Napster at source—we will block it at your cable company, we will block it at your phone company, we will block it at your [Internet-service provider]. We will firewall it at your PC."

—Steve Heckler, senior vice president of Sony Pictures Entertainment, Inc., threatening firewalls and brimstone for Napster users during a recent conference in Long Beach, California.

      http://www.uwiretoday.com/computin g081700001.html

"By this letter, we ask you to also promptly ban access by your community to Napster. Even without the threat of litigation from artists and other copyright owners, I believe that you can easily recognize the irony of encouraging your students to matriculate in the creative arts, while engaging in behavior which, if unchecked, will make it impossible for those students to earn an income from their future creative efforts. Put simply, we believe that Harvard has a moral, ethical and legal obligation to take appropriate steps to assure that it is not a willing participant in and an enabler of the theft of intellectual property through Napster."

—Excerpt from a letter to Harvard president Neil Rudenstine from Howard King, lawyer for Napster-foes Metallica and Dr. Dre.


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Comments? Questions? Opinions? Submissions? Send a letter to the editor at filter-editor@cyber.law.ha rvar d.edu

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Last updated

January 15, 2008