Web Law 101An Overview of Internet Law

Presented by Andrew M. JaffeFor the Akron Bar Association

December 10, 2010

Copyright 2010 Andrew M. Jaffe

Andrew M. JaffeAttorney at Law

3359 South Smith RoadFairlawn, OH 44333

(330) 666-5026attorneyjaffe@aol.com

fax (206) 203-3649www.netlaws.us

Andy received his J.D. from the University of Akron School of Law where he served on the Law Review and has been a licensed attorney since 1977. He received his B.A. in Economics from Miami University, Oxford, Ohio, in 1973. For the past eight years he has limited his practice to Internet Law.

Mr. Jaffe has represented clients in dozens of Internet law suits. More importantly, he has kept numerous clients from creating legal problems for themselves with proactive counseling on their Internet activities.

E-Commerce Internet Marketing has become a closely regulated industry. Now every business needs an experienced attorney to guide them through the maze of this emerging legal field, and individuals need to know their rights when dealing with companies in web related transactions.

Primary Internet Legislation• The Communications Decency Act (1996) – U.S. attempt on controlling Internet

pornography which has largely been overturned by the courts. However, Section 230 of the CDA has been expanded by the courts as an important protection for online service providers and users from actions against them based on the content of third parties

• The Digital Millennium Copyright Act (DMCA) (1998) – Makes U.S. copyright law consistent with WIPO, creates Safe Harbor for website owners.

• The Internet Tax Freedom Act (1998) - Bars federal, state and local governments from taxing Internet access or from imposing discriminatory Internet-only taxes such as bandwidth taxes. This act does NOT affect sales tax.

• The Children's Online Privacy Protection Act (COPPA) (1998) – Creates strong guidelines for the online collection of personal information from children under 13 years of age.

• The Anti-Cybersquatting Consumer Protection Act (ACPA) (1999) - Protects trademark owners from acts of cyber piracy by those who have bad faith intent in using a domain name to profit from another’s trademark.

• The Can-Spam Act (2003) – Provides guidelines for the sending of Unsolicited Commercial Email.

• California Online Privacy Protection Act (2003) – In absence of a federal law, CA provided the driving force prompting firms to provide online privacy policies.

• Safe Web Act (2006) - provided the FTC with new powers to cooperate with foreign law enforcement agencies.

• Numerous FTC Guidelines – The FTC has issued many guidelines for Internet use including its guidelines for the use of Endorsements and Testimonials in Advertising (2009).

AOL Brings Phenomenal Growth to the InternetIn the late 1990’s AOL placed discs in the Sunday supplements and become the largest ISP in the country with 25 million members and then purchased Time Warner. AOL is now a 2nd rate ISP and is not likely to last into the next decade.

Internet Growth Catches Old Media By Surprise

The very newspapers who profited from delivering the AOL discs are now suffering from Internet news outlets. Over the past 5 years many newspapers have folded and most are mere images of their former selves.

This year General Electric sold NBC – Internet broadcasting is hurting television and the networks are likely to become just as antiquated as the newspapers.

It All Starts With A Web SiteWebLaw101.com

URL - Uniform Resource Locator = Domain Names

• The use of URLs is for the addresses of web pages on the World Wide Web such as http://www.WebLaw101.com. The domain name or IP address gives the destination location for the URL. The domain name = the IP address.

HOW DOES TRADEMARK LAW PROTECT DOMAIN NAMES?

• The domain name system was invented to allow internet users a way of accessing specific computers on the Internet through easily remembered names. Domain names have become a valuable property in today’s Internet economy. Consequently, trademark owners have been quick to use the courts when they feel others have taken domain names they are exclusively entitled to use.

• In addition to existing trademark legislation, in 1999, congress passed the Anti-Cybersquatting Consumer Protection Act (ACPA) to protect trademark owners from acts of cyber piracy by those who have bad faith intent in using a domain name to profit from another’s trademark.

• There is now over fifteen years of case law concerning ownership rights in domain names, much of which is extremely fact specific. It has not been easy for the court system to fit the cyber world into existing Trademark law. However, once a court found a domain name registrant was acting in bad faith they found a reason to prevent the continued use of the domain by the registrant even if they had to create new trademark law reasons.

• Recently, ICANN has developed a dispute resolution procedure as an alternative to filing suit for trademark owners. Again, whether the registrant acted in bad faith will be a large factor in the ultimate resolution.

Trademark And Domain Names• Ninth Circuit Cases Offer Guidance on Trademark Rights ... Two Very Different Rulings From

One Judge• Chief Judge Alex Kozinski held that use by a small web-based education and information

business of the name “eVisa” in a domain name was not allowed because it could dilute the value of the trademark owned by the credit card company Visa International. But less than two weeks later, the same judge held that an auto broker’s use of “Lexus” in its domain name was a permissible fair use of Toyota’s mark. A comparison of the two cases offers important guidance on the limits that apply to one’s use of a famous brand name in business.

Visa International Service Association v. JSL Corp.• The court held that the website www.evisa.com (operated by JSL, a non-competing internet-

based “multilingual education and information” company) diluted Visa International’s “Visa” trademark.

• Dilution, unlike infringement, requires proof that the mark is “famous and distinctive,” that the defendant started using the mark in commerce after the mark became famous and distinctive, and that the defendant’s use of the mark is likely to “dilute” the value of plaintiff’s mark.

Toyota Motor Sales, U.S.A., Inc. v. Tabari• Defendants sold Lexus cars online at websites they called www.buy-a-lexus.com and

www.buyorleaselexus.com. • In most cases, infringement involves a defendant who used the plaintiff’s mark in connection

with the defendant’s different (often competing) product, in a manner “likely to confuse” the public. But in this case, the Defendants used the Lexus mark only to describe the actual Lexus product, not their own competing product. (As the court noted, “when they say Lexus, they mean Lexus.”) The main issue, therefore, was whether the Defendants ’ use of the Lexus mark would “inspire a mistaken belief” by consumers that the Defendants were “sponsored or endorsed” by the trademark holder, Toyota. The Judge wisely ruled not.

TERMS OF SERVICE• Whether you name it Terms of Service (TOS), Authorized Use Policy, or Terms of Use,

they all boil down to one thing – the Terms and Conditions for the use of your web site. Properly written, the TOS becomes a contract between you and your web site visitors. Further, since you can dictate the terms on a take it or leave it basis, you are in a position to insulate yourself from most legal difficulties.

• WARNING! One of the biggest mistakes made by corporate America today is not following its own published procedures. The TOS is a contract! If you do not adhere to the terms and conditions you will be in breach of contract and the user will have an easy time of defeating you in a legal proceeding. It is imperative that you understand and abide by your own terms and conditions! If you say you are going to do something, you not only need to do it, you need to document in writing that it was done.

Click Wraps and Browser Wraps • There has been a change in the way courts view and enforce the Terms of Service (TOS) and

Privacy Policy (PP) of web sites. Previously, the courts have taken the view that a link to your PP or TOS will create an enforceable contract (called a “browser wrap” agreement.) This view was affirmed by then Judge and now Justice Sotomayor in her decision in Specht v. Netscape Communications Corp. in 2002.

• However, on September 4, 2009, Judge Sterling Johnson of the Eastern District of New York changed that view with his decision in the case of Hines v. Overstock.com. In his decision, Judge Johnson has taken the view that merely saying that by using a web site you have agreed to its terms does not mean that the user has had reasonable notice to those terms. His view was that for the PP and TOS to be enforceable, the site user needs to indicate his acceptance of these terms by a manifestation of assent. It is my belief that this decision changes the previous law of “browser wrap” to a new level, the “click wrap” (i.e. the user clicks his consent.)

• While the opinion of Judge Johnson is not binding on all courts, I am of the belief that it will be embraced throughout the court system. His decision reminds me of the decision in Parker v South Eastern Railway, an English case from 1877, which every first year lawyer learns in their Contracts class. In that case, the jury decided that it is NOT reasonable to expect people to read the “contract” on the back of a railroad ticket. This case has never been overturned and is the law in the U.S., having been used as the precedent and cited in case law to include the back of movie tickets, parking lot receipts, coat check receipts, etc. Given this old precedent, I think the Hines case will quickly become the law of the land with lawyers arguing a browser wrap contract is no different than the back of a movie ticket.

• To make sure your users have constructive notice of the terms contained in your PP and TOS I strongly recommend that you use an “I agree” click button on your web site for your PP & TOS when your users register and (if a commercial site) again during the ordering process.

Size Matters & Also Position for LinksSize Matters – Advertising is an old profession, and advertising cases have been coming before the courts for centuries. Courts have long held that hiding terms and conditions in small print renders them invalid. Please show your links to your Privacy Policy and Terms of Service in a type face no smaller than the surrounding text. The truth of the matter is that people tend to click “I Accept” and do not read the contract until they have a problem and by then it is too late to object to the terms. So, please, be proud of your Privacy Policy and Terms of Service; print both their links and the text itself in the same type face you use to promote your products and services.

Position Matters – Courts are taking the position that links “below the fold” (a term from the newspaper world) are hidden. That is courts want to see the links at the top or down the left hand side of the web site page.

In fact, the California Online Privacy Protection Act actually goes into great detail about where the links shall be, what size, what color etc.

The reality of the situation is web site owners are still placing their links at the bottom of their home pages. Whether this situation will ultimately change is not now known.

Creating Your Terms of Service

• Below are the sections recommend for your TOS. These are your terms, change them to match the terms and conditions as you want them to apply.

• Title Begin your TOS with the title and then place your company name and contact info below. If you operate under an LLC or Corporation be sure that the TOS makes that clear. Example:

Terms of ServiceWeb Law 101, LLC3359 South Smith RoadFairlawn, Ohio, 44333206-426-6905support@weblaw101.com

• Welcome (and party names):

Welcome to the web site of Web Law 101, LLC, dba weblaw101.com (hereinafter “We”, “Us”, “Our”) and thank you for considering Our products and services.

• Acceptance - The TOS is a contract, you need the visitor to accept the terms:

By checking the “I Agree” button You agree to the terms and conditions of this Agreement which, along with the consideration of the mutual promises You and We make to each other below, becomes a binding contract between You and Web Law 101, LLC, dba weblaw101.com.

Creating Your Terms of Service Pg 2• PRIVACY POLICY – Our Privacy Policy is located at (place link here) and is hereby incorporated

into this Agreement by reference. You hereby agree to abide by Our Privacy Policy at all times.

• USER NAME AND PASSWORDS - You hereby agree that you are responsible for all actions taken under Your username and password. Please remember to keep this data secure.

• USING GOOD CITIZENSHIP (IN FORUMS OR ADVERTISING, ETC.) - You understand and agree that You will not Use Our web site to post, email, upload or transmit any content that is patently offensive, vulgar, unlawful, threatening, defamatory, abusive, tortuous, obscene, libelous, illegal, hateful, harmful, harasses or advocates harassment of another person, invasive of another person’s privacy, exploitive of people in a sexual or violent manner, racially, ethnically or otherwise objectionable or promotes racism, bigotry, hatred or physical harm of any kind against any group or individual; Impersonate another person or post a photograph of another person as Your image; stalk or otherwise harass another; harm a minor in any way; promote commercial activities and/or sales such as contests, sweepstakes, barter, or advertising except as provided by the functionality of the Site; post, email, upload or transmit any unsolicited or unauthorized advertising, promotional materials, junk mail, spam, unsolicited mass mailing, chain letters, or pyramid schemes; promote an illegal or unauthorized copy of another person's copyrighted work; upload, post, email, transmit or otherwise make available any material that contains software viruses or any other computer code, files or programs designed to interrupt, destroy or limit the functionality of any computer software or hardware or telecommunications equipment; use software that automatically creates user identities; intentionally or unintentionally violate any applicable local, state, national or international law; post a review on a business You own, control or are employed by; post inaccurate or misleading information or pictures; or misrepresenting a product or service. You understand and agree that You are solely responsible for Your interactions with other visitors and that We reserve the right, but have no obligation, to monitor disputes between You and other visitors.

Creating Your Terms of Service Pg 3• REGISTRATION AND MEMBERSHIP FEE - To become a Member of our website you will be asked to fill

out a registration form. You will then be asked to pay a $97.00 registration fee online with your credit card. (A portion of your registration fee may be paid as a commission to Our marketing affiliates.) Our merchant bank will keep a copy of your credit card information on file and will bill you a $37.00 monthly Membership fee 30 days after registration and every 30 days thereafter for as long as you maintain your Membership.

• REFUND POLICY – You may terminate your Membership and receive a full refund of your registration fee at any time during the first 21 days of your Membership. Simply email support@weblaw101.com and request your refund. Thereafter you may cancel your Membership at any time for any reason, or no reason, and we will discontinue billing your monthly Membership fee. There will not be a proration of any portion of an unused month.

• TRADEMARKS - We hereby claim Web Law 101, LLCTM, and WebLaw101.comTM to be trademarks of Our company.

• COPYRIGHT – As indicated by the notice on the bottom of Our Home Page, Web Law101, LLC dba weblaw101.com claims a copyright to the content of this web site.

• ROYALTY FREE LICENSE - Web Law101, LLC., dba weblaw101.com hereby grants a royalty free license to registered Members for the following items contained on this site: 1) The Privacy Policy You generate on our site, 2) The Terms of Service sample, 3) The Uniform Affiliate Agreement, 4) The LLC Operating Agreement sample, and 5) The Case Study Kit. This Royalty Free License is granted to the registered Member and is non-transferable and is limited to web sites which do not directly compete with weblaw101.com.

Creating Your Terms of Service Pg 4DIGITAL MILLENNIUM COPYRIGHT ACT

As provided for in the Digital Millennium Copyright Act: If You feel any content on this web site violates Your copyrights please contact our designated agent: Andrew Jaffe3359 South Smith Rd.Fairlawn, OH 44333Fax: (206) 203-3649 by fax or regular U.S. mail (not by email) with the following information:

A physical or electronic signature of a person authorized to act on behalf of the owner of an exclusive right that is allegedly infringed.

Identification of the copyrighted work claimed to have been infringed, or, if multiple copyrighted works at a single online site are covered by a single notification, a representative list of such works at that site.

Identification of the material that is claimed to be infringing or to be the subject of infringing activity and that is to be removed or access to which is to be disabled, and information reasonably sufficient to permit the service provider to locate the material. Information reasonably sufficient to permit the service provider to contact You, such as an address, telephone number, and, if available, an electronic mail address at which You may be contacted.

A statement that You have a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law.

Creating Your Terms of Service Pg 5DIGITAL MILLENNIUM COPYRIGHT ACT (cont)

A statement that the information in the notification is accurate, and under penalty of perjury, that You are authorized to act on behalf of the owner of an exclusive right that is allegedly infringed. Once We have received Your complaint We will:Remove or disable the identified infringing material (but maintain a copy for later use);Promptly notify the subscriber with a copy to the complaining party that We have removed or disabled access to the material; and

We will inform the subscriber that they may submit a counter-notification regarding the claimed infringing material.

Counter Notification - To be effective under this subsection, a counter notification must be a written communication provided to the service provider's designated agent by fax or regular U.S. mail (not email) that includes substantially the following: A physical or electronic signature of the subscriber.

Identification of the material that has been removed or to which access has been disabled and the location at which the material appeared before it was removed or access to it was disabled. A statement under penalty of perjury that the subscriber has a good faith belief that the material was removed or disabled as a result of mistake or misidentification of the material to be removed or disabled.

Creating Your Terms of Service Pg 6DIGITAL MILLENNIUM COPYRIGHT ACT (cont)

The subscriber's name, address, and telephone number, and a statement that the subscriber consents to the jurisdiction of Federal District Court for the judicial district in which the subscriber’s address is located, or if the subscriber's address is outside of the United States, for any judicial district in which the service provider may be found, and that the subscriber will accept service of process from the person who provided the counter notification or an agent of such person.

Upon receipt of a counter notification We will promptly provide the complaining party with a copy of the counter notification, and inform that person that it will replace the removed material in 10 business days; and We will replace the removed material and cease disabling access to it not less than 10, nor more than 14, business days following receipt of the counter notice, unless Our designated agent first receives notice from the person who submitted the notification that such person has filed an action seeking a court order to restrain the subscriber from engaging in infringing activity relating to the material on the service provider's system or network.

Creating Your Terms of Service Pg 7WARRANTYYOU WARRANT THAT AT ALL TIMES YOU WILL BE IN COMPLIANCE WITH THIS AGREEMENT AND THAT YOUR USE OF ANY SERVICE OFFERED BY US WILL NOT VIOLATE FEDERAL OR STATE LAW. OUR SERVICE IS PROVIDED ON AN "AS IS" AND "AS AVAILABLE" BASIS. YOU EXPRESSLY AGREE THAT USE OF ANY SERVICE OFFERED BY US IS AT YOUR SOLE RISK. TO THE FULLEST EXTENT PERMISSIBLE PURSUANT TO APPLICABLE LAW, WE DISCLAIM ALL WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABLITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT. WE DO NOT MAKE ANY WARRANTY THAT OUR SERVICE WILL MEET YOUR REQUIREMENTS, OR THAT ANY SERVICE OFFERED BY US WILL BE UNINTERRUPTED, TIMELY, SECURE, OR ERROR FREE, OR THAT DEFECTS, IF ANY, WILL BE CORRECTED; NOR DO WE MAKE ANY WARRANTY AS TO THE RESULTS THAT MAY BE OBTAINED FROM THE USE OF ANY SERVICE OFFERED BY US OR AS TO THE ACCURACY OR RELIABILITY OF ANY INFORMATION OBTAINED THROUGH ANY SERVICE OFFERED BY US. YOU UNDERSTAND AND AGREE THAT ANY MATERIAL AND/OR DATA DOWNLOADED OR OTHERWISE OBTAINED THROUGH THE USE OF ANY SERVICE OFFERED BY US IS AT YOUR OWN DISCRETION AND RISK, AND THAT YOU WILL BE SOLELY RESPONSIBLE FOR ANY DAMAGE TO YOUR COMPUTER SYSTEM OR LOSS OF DATA THAT RESULTS FROM THE DOWNLOAD OF SUCH MATERIAL AND/OR DATA. WE DO NOT MAKE ANY WARRANTY REGARDING ANY GOODS OR SERVICES PURCHASED OR OBTAINED THROUGH OR FROM US OR ANY TRANSACTIONS ENTERED INTO BY USE OF OR THROUGH ANY SERVICE OFFERED BY US. NO ADVICE OR INFORMATION, WHETHER ORAL OR WRITTEN, OBTAINED BY YOU FROM US OR THROUGH ANY SERVICE OFFERED BY US SHALL CREATE ANY WARRANTY NOT EXPRESSLY MADE HEREIN. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OF CERTAIN WARRANTIES, SO SOME OF THE ABOVE EXCLUSIONS MAY NOT APPLY TO YOU.

Creating Your Terms of Service Pg 8LIMITATION OF LIABILITY UNDER NO CIRCUMSTANCES, INCLUDING, WITHOUT LIMITATION, NEGLIGENCE, SHALL WE OR OUR PARENTS, SUBSIDIARIES, AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR SUPPLIERS BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM THE USE OR THE INABILITY TO USE ANY SERVICE OFFERED BY US, OR FOR THE COST OF PROCUREMENT OF SUBSTITUTE GOODS AND SERVICES, OR RESULTING FROM ANY GOODS OR SERVICES PURCHASED OR OBTAINED, OR MESSAGES RECEIVED, OR TRANSACTIONS ENTERED INTO BY MEANS OF OR THROUGH ANY SERVICE OFFERED BY US, OR RESULTING FROM UNAUTHORIZED ACCESS TO OR ALTERATION OF YOUR TRANSMISSIONS OR DATA, OR OTHER INFORMATION THAT IS SENT OR RECEIVED OR NOT SENT OR RECEIVED, INCLUDING BUT NOT LIMITED TO, DAMAGES FOR LOSS OF PROFITS, USE, DATA, OR OTHER INTANGIBLES, EVEN IF WE HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. YOU ALSO AGREE THAT WE SHALL NOT BE RESPONSIBLE OR LIABLE TO YOU, OR TO ANYONE, FOR THE STATEMENTS OR CONDUCT OF ANY THIRD PARTY ON OR ARISING FROM USE OF ANY SERVICE OFFERED BY US. IF YOU ARE DISSATISFIED WITH ANY SERVICE OFFERED BY US YOUR EXCLUSIVE REMEDY IS TO DISCONTINUE USE OF THE SERVICE WITHOUT REFUND OF ANY KIND WHATSOEVER.

Creating Your Terms of Service Pg 9• INDEMNIFICATION

You agree to indemnify, defend, and hold Us and Our parents, subsidiaries, affiliates, officers, directors, employees, agents, and suppliers, and their respective affiliates, officers, directors, employees, and agents, harmless from any claim, action, demand, or damage, including reasonable attorney's fees, made by any third party or governmental agency arising out of or related to Your use of any service offered by Us or Your violation of this Agreement, including without limitation, claims or suits for libel, violation of rights of privacy or publicity, interference with property rights, trespass, violations of Federal or State Law, including but not limited to, Can-Spam violations or the Federal Trade Commission’s Telephone Sales, copyright infringement, trademark infringement, patent infringement or plagiarism. We may, at Our sole discretion, assume the exclusive defense and control of any matter subject to indemnification by You. The assumption of such defense or control by Us shall not excuse any of Your indemnity obligations.

• FORCE MAJEURE

Neither party shall be liable for delays or nonperformance of this Agreement caused by strike, fire or accidents, nor shall either party be liable for delay or nonperformance caused by lack of availability of materials, fuel or utilities or for any other cause beyond its control.

• ASSIGNMENT

You may not assign Your rights or obligations under this Agreement without Our prior written consent.

Creating Your Terms of Service Pg 10• RELATIONSHIP OF THE PARTIES

The parties to this Agreement are independent contracting entities and there is no partnership or agency relationship between them.

• INTENDED FOR USERS OVER 18 (13?)

Our web site is intended for use by individuals 18 years of age or older only. If You are under the age of 18 please leave this site immediately.

• TERM OF AGREEMENT

Either party may terminate this Agreement at any time, for any reason or for no reason.

• MODIFICATION

We reserve the right to modify this Agreement at any time by a conspicuous posting on Our web site or by sending You an email notification. If You do not agree with the modification to this Agreement Your sole remedy is to cease doing business with Us.

• NOTICES TO US

All notices to Us under this Agreement shall be in writing and shall be delivered: a) by express overnight courier; or c) by United States Mail, registered or certified, return receipt requested, postage prepaid to the address recorded above for Us. Notices shall be deemed received on the date of personal delivery, the date of actual receipt as indicated on the delivery notice or return receipt, or the date the receipt is refused; whichever is earlier.

• GOVERNING LAW

The parties agree that this Agreement and its terms and conditions shall be subject to and construed in accordance with the laws of the State of Ohio. The parties consent to exclusive jurisdiction and venue for any claim for enforcement of this Agreement in the state or federal courts of Summit County, Ohio.

Creating Your Terms of Service Pg 11• SEVERABILITY

If any provision, or portion thereof, of this Agreement is held by a court of competent jurisdiction to be invalid under any applicable statute or rule of law, You understand and agree that such invalidity shall not affect the validity of the remaining portions of the Agreement and understand and agree that We may substitute for the invalid provision a valid provision which most closely approximates the intent and economic effect of the invalid provisions.

• AGREEMENT

This Agreement sets forth the entire agreement between the parties. You acknowledge and agree that You have reviewed this Agreement in its entirety, and every part thereof, and that You understand the Agreement. You further acknowledge and agree that You have had the opportunity to review this Agreement and otherwise consult with Your independent counsel as to the Agreement.

• ELECTRONIC SIGNATURES

YOU HEREBY AGREE TO THE USE OF ELECTRONIC SIGNATURES, CONTRACTS, ORDERS AND OTHER RECORDS AND TO ELECTRONIC DELIVERY OF NOTICES, POLICIES AND RECORDS OF TRANSACTIONS INITIATED OR COMPLETED THROUGH THE SITE OR SERVICES OFFERED BY US. FURTHER, YOU HEREBY WAIVE ANY RIGHTS OR REQUIREMENTS UNDER ANY STATUTES, REGULATIONS, RULES, ORDINANCES OR OTHER LAWS IN ANY JURISDICTION WHICH REQUIRE AN ORIGINAL SIGNATURE OR DELIVERY OR RETENTION OF NON-ELECTRONIC RECORDS.

The Web-Site Privacy PolicyEvery web site needs a Privacy Policy describing the types of information it collects, how it is used, how it is shared, how it is stored and how it is protected. While there is currently no Federal law directly regulating the Privacy Policy, the regulations contained in other laws affect your web site and will be discussed below.

• U.S. Privacy Policy Laws

The FTC’s Fair Information Principles identify five critical issues concerning website privacy. We can expect these principles to be codified and regulations promulgated in the near future:

1. Notice and Awareness – Consumers should be given notice of an entity's information practices before any

personal information is collected from them.

2. Choice and Consent – choice means giving consumers options as to how any personal information collected from them may be used. Specifically, choice relates to secondary uses of information -- i.e., uses beyond those necessary to complete the contemplated transaction.

3. Access and Participation – an individual's ability both to access data about them (i.e., to view the data in an entity's files) and to contest that data's accuracy and completeness.

4. Integrity and Security – Security involves both managerial and technical measures to protect against loss and the unauthorized access, destruction, use, or disclosure of the data.

5. Enforcement and Redress - core principles of privacy protection can only be effective if there is a mechanism in place to enforce them.

• Recently, the FTC has been prosecuting companies who have had privacy breeches under Section 5 of FTC Act as “deceptive practices” – that is they did not guard their data security as they said they would. It is interesting to note that the complaints filed by the FTC in this area all say that the firms who had their data breeched should have had better security in place. As they are looking at the security breech in hindsight, they can list all the things the offending firm should have thought of, and because they did not, they must not have been vigilant enough. To overcome this argument, this author recommends you have written SOP’s (Standard Operating Procedures) which show the steps you have taken to secure your data, and written documents proving compliance with your SOP’s.

The Web-Site Privacy Policy cont.• While there is no Federal comprehensive Privacy Policy law, each of the following acts have

Privacy Policy implications:

• The Children's Online Privacy Protection Act (COPPA) affects websites that knowingly collect information about children under the age of 13. The COPPA regulations are incredibly complicated – if your web site is available to children under the age of 13 it is this author’s recommendation that you contact a knowledgeable attorney to review your compliance with COPPA.

• The Gramm-Leach-Bliley Act contains The Financial Privacy Rule which requires firms to provide a privacy policy which communicates the data sharing practices of the firm. It also requires an opt-out mechanism for the customer as required by the Fair Credit Reporting Act. If your firm keeps a copy of the customer’s payment information (i.e. credit card number) on file, I recommendation that you contact a knowledgeable attorney to review your compliance with this act.

• Health Insurance Portability and Accountability Act (HIPAA) establishes the rules and regulations for the storage and dissemination of Protected Health Information. If your company keeps health information on file about your customers (i.e. prescription orders) it is this author’s recommendation that you contact a knowledgeable attorney to review your compliance with HIPPA.

• Some states have passed their own privacy laws. The most significant of these is the California Online Privacy Protection Act. This law requires operators of commercial web sites or online services that collect personal information on California residents to conspicuously post a privacy policy on the site and to comply with its policy. The privacy policy must, among other things, identify the categories of personally identifiable information collected about site visitors and the categories of third parties with whom the operator may share the information.

Creating Your Privacy PolicyPRIVACY POLICY

Web Law 101, LLC3359 South Smith RoadFairlawn, Ohio, 44333206-426-6905support@weblaw101.com

Welcome to the web site of WebLaw101.com ,and thank You for considering Our products and services. Guarding Your Personal Information is very important to Us, and the following policy explains how information about You is used and protected. As stated in Our Terms of Service, Our Privacy Policy forms part of Your legal agreement with Us. Your use of this Site signifies that You agree with all terms of this Policy. Please do not use this Site if You disagree with any part of our Privacy Policy.

INFORMATION COLLECTED

Non-Personal Information

When You visit Our web site, Our servers may automatically collect certain Non-Personal Information such as: Your IP address, which web pages You visit and for how long, Your operating system or Your browser.

We may use cookies to store or retrieve information. Cookies are a small piece of text stored on Your computer by Your web browser which may allow Us to identify You upon return to the web site or to remember specific information such as the contents of Your shopping cart. Cookies are neither a virus nor spy-ware.

Creating Your Privacy Policy Pg 2Personal Information The Personal Information We may collect and store is the information that You voluntarily disclose to Us, including but not limited to; Your name, address, email address, phone number, social security number, etc. Third Party Information Our web site may contain links or display advertising from third parties. Non-Personal and Personal Information You voluntarily provide to third parties through links on Our web site may be shared with us by Our advertisers and other third parties. In addition, we may receive Personal information from co-registration partners when You have voluntary agreed to allow a third party to share their data. We have no control over the privacy practices of these third parties. Please be sure to read and accept the Privacy Policy on any web site you visit. No Information Collected from Children We do not intentionally collect Personal Information from children who are younger than age 13.

Creating Your Privacy Policy Pg 3STORAGE AND SECURITY OF PERSONAL INFORMATION We store Your Personal Information on Our computers, and We believe we have appropriate security measures in place to protect Your Personal Information. However, we cannot guarantee that our security measures will prevent Our computers from being accessed without authorization and Your Personal Information stored on them stolen, deleted or changed. We assume no responsibility for such unauthorized actions. HOW WE USE YOUR INFORMATION We may use Your Personal Information for any legal purpose in Our sole discretion, including but not limited to; membership, registration, log-in or order fulfillment purposes. We may also use Your Personal Information to contact you by phone or email. DISSEMINATION OF INDIVIDUAL INFORMATION We may transfer Personal Information to third parties for order fulfillment, to respond to Legal Processes or governmental requests for information, or for any other legal purpose.

UPDATING INDIVIDUAL INFORMATION You may request that We update Your Personal Information by contacting us at support@weblaw101.com

Creating Your Privacy Policy Pg 4DELETING INDIVIDUAL INFORMATION You may request that We delete Your Personal Information by contacting us at support@weblaw101.com Deleting your personal information may cause disruption in the use of Our site. PRIVACY POLICY UPDATES This Privacy Policy is effective as of March 5, 2010. We reserve the right to revise this policy from time to time without prior notice. You will be notified of any material changes either by email or by a conspicuous posting on our web site.

Copyright Overview A copyright is the exclusive property right granted to the author or creator of original works. Despite what some people think -- if it is posted on the Internet it already belongs to somebody.

WHAT IS A COPYRIGHT?

A copyright is the exclusive property right granted to the author or creator of original works including literary, dramatic, musical, artistic, and certain other intellectual works.

HOW ARE COPYRIGHT RIGHTS ACQUIRED?

Copyright is Secured Automatically upon Creation

The way in which copyright protection is secured is frequently misunderstood. No publication or registration or other action in the Copyright Office is required to secure copyright. There are, however, certain definite advantages to registration.

Copyright is secured automatically when the work is created, and a work is “created” when it is fixed in a copy for the first time. “Copies” are material objects from which a work can be read or visually perceived either directly or with the aid of a machine or device, such as books, manuscripts, sheet music, film, videotape, or microfilm.

WHAT WORKS ARE PROTECTED?Copyright protects “original works of authorship” that are fixed in a tangible form of expression. The fixation need not be directly perceptible so long as it may be communicated with the aid of a machine or device. Copyrightable works include the following categories: literary works, musical works, including any accompanying words, dramatic works, including any accompanying music, pictorial, graphic, and sculptural works, motion pictures and other audiovisual works, sound recordings, architectural works. These categories should be viewed broadly. For example, computer programs and most “compilations” may be registered as “literary works”; maps and architectural plans may be registered as “pictorial, graphic, and sculptural works.”

Copyright Overview contWHAT IS NOT PROTECTED BY COPYRIGHT?Several categories of material are generally not eligible for federal copyright protection. These include among others:

1. Works that have not been fixed in a tangible form of expression (for example, choreographic works that have not been notated or recorded, or improvisational speeches or performances that have not been written or recorded.)

2. Titles, names, short phrases, and slogans; familiar symbols or designs; mere variations of typographic ornamentation, lettering, or coloring; mere listings of ingredients or contents.

3. Ideas, procedures, methods, systems, processes, concepts, principles, discoveries, or devices, as distinguished from a description, explanation, or illustration.

4. Works consisting entirely of information that is common property and containing no original authorship (for example: standard calendars, height and weight charts, tape measures and rulers, and lists or tables taken from public documents or other common sources).

Copyright Overview contNOTICE OF COPYRIGHTThe use of a copyright notice is no longer required under U. S. law, although it is often beneficial. Use of the notice may be important because it informs the public that the work is protected by copyright, identifies the copyright owner, and shows the year of first publication. Furthermore, in the event that a work is infringed, if a proper notice of copyright appears on the published copy to which a defendant in a copyright infringement suit had access, then no weight shall be given to such a defendant’s interposition of a defense based on innocent infringement. Innocent infringement occurs when the infringer did not realize that the work was protected.

The use of the copyright notice is the responsibility of the copyright owner and does not require advance permission from, or registration with, the Copyright Office. The notice should contain all three of the following elements:

1. The symbol © (the letter C in a circle), or the word “Copyright,”

2. The year of first publication of the work.

3. The name of the owner of copyright in the work. Example: © 2008 John Doe

Copyright Overview contTRANSFER OF COPYRIGHT

A copyright owner’s exclusive rights may be transferred, but the transfer of exclusive rights is not valid unless that transfer is in writing and signed by the owner of the rights. Transfer of a right on a nonexclusive basis does not require a written agreement.

COPYRIGHT REGISTRATION

In general, copyright registration is a legal formality intended to make a public record of the basic facts of a particular copyright. However, registration is not a condition of copyright protection. Registration may be made at any time within the life of the copyright.

Even though registration is not a requirement for protection, the copyright law provides several inducements and advantages to encourage copyright owners to make registration. Among these advantages are the following:

1. Registration establishes a public record of the copyright claim.

2. Before an infringement suit may be filed in court, registration is necessary for works of U.S. origin.

3. If made before or within five years of publication, registration will establish prima facie evidence in court of the validity of the copyright and of the facts stated in the certificate.

4. If registration is made within three months after publication of the work or prior to an infringement of the work, statutory damages and attorney’s fees will be available to the copyright owner in court actions. Otherwise, only an award of actual damages and profits is available to the copyright owner.

5. Registration allows the owner of the copyright to record the registration with the U.S. Customs Service for protection against the importation of infringing copies.

Defamation –Libel and SlanderSection 230 of the Communications Decency Act grants you immunity for the tortuous acts of others committed on your web site. This is good news for website operators who host blogs, forums, social networking, etc. on their sites.

Defamation is a false attack on a person’s character or good name which damages their reputation. Defamation is called libel if it is in hard copy form and slander if is a result of the speaker’s oral words. The elements that must be proved to establish defamation are that the statement:

1. Was published to an outside party;

2. Is a false statement of fact;

3. Is understood to concern the defamed party and will tend to harm their reputation; and

4. Must have been made with actual malice if the defamed party is a public figure There are many affirmative defenses to an acquisition of defamation including the truth of the statement, that the statement was merely the defamer’s opinion (but merely labeling a statement as your “opinion” does not make it so - Courts look at whether a reasonable reader or listener could understand the statement as asserting a statement of verifiable fact.) Further, some jurisdictions have retraction statutes that provide protection from defamation lawsuits if the publisher retracts the allegedly defamatory statement.

Defamation –Libel and Slander Pg2Immunity Under Section 230 of the Communications Decency Act (CDA) Your Web Site’s Safe Harbor

In 1996 the U.S. Congress passed the Communications Decency Act (CDA) to regulate pornography on the Internet. An amendment to the act, called Section 230, was added in committee and passed as part of the act. Much of the CDA has been overturned since it was passed in 1996, however, Section 230 has become landmark legislation which the courts have liberally construed and upheld.

Section 230 is entitled, “Protection for “Good Samaritan” blocking and screening of offensive material” and provides that the operator of a web site is not liable for the postings of others on their sites – in effect granting immunity from any civil action. Even if the web site performs traditional editorial functions such as editing, deleting or choosing which posts are presented on the web site it is not liable for the statements of others. Caution: You can go too far; and if you are aiding and abetting the defamation you can be held liable.

Furthermore, the courts have liberally construed Section 230 and expanded the safe harbor Immunity beyond defamation to most tort causes of action. Today Section 230 of the CDA can be used as a defense to almost any tort action with a good chance of success. However, Section 230 specifically excludes the immunity for criminal prosecutions, intellectually property law, state law, or the Communications Privacy Law. You need do nothing to create your safe harbor, the immunity is granted by statute. However, beware of invalidating your Immunity by putting promises in your Terms of Service which could override Section 230. For instance, if you had a term which provided for putting a posting in suspension while you conducted an investigation, and you did nothing; while Section 230 would grant you immunity on any tort claim, you would not have immunity from a breach of contract claim.

Email Marketing Laws – The Do’s and Don’ts of Can-SpamUnder the act it is a felony punishable with jail terms, fines and forfeitures:1. To use proxies or relays to send your mail,2. To falsify your header (by definition, you are falsifying your headers if you purposely disguise

the e-mail’s origin), or3. If you falsify the registration information when buying domains or setting up e-mail accounts,

or when registering for IP addresses.The act goes on to list civil penalties unless you take the following actions to conform to the requirements of the law:4. Your header information and registration information has to be true and correct.5. You must have a valid from address, registered with true and correct information.6. You cannot use a subject line that would be likely to mislead the recipient about the contents

of the e-mail.7. You must have a conspicuous opt-out mechanism which works for 30 days after the mailing is

completed. (This can be at your website).8. You must honor your opt-outs within 10 days of request.9. Your message must have a conspicuous identification that it is an advertisement.10. The message must contain a valid physical postal address of the sender.11. You must not use recipient addresses that were obtained using an address harvester or by

means of a dictionary attack. (Triple damages apply.)12. You cannot use automated means to register for multiple e-mail addresses.13. Sexually orientated material will require special marks of content.14. Customers who know their products are being sold in violation of the act are also held to be

liable.15. There is really no way for an individual to sue a spammer under this act, only the State or the

Feds, or an ISP that has suffered a loss. The act supersedes State internet laws, but with many exceptions.

Internet Issues Affecting Employment LawEmployer Liability for the Online Conduct of Employees.I. Almost every employer provides its employees with Internet access on the job.

I. Respondeat Superior - Employers are vicariously liable for negligent acts or omissions by their employees.

II. Negligent Entrustment –An employer can be found liable for negligent hiring, retention, supervision or training even without provision of any dangerous instrumentality to the employee.

III. Importance of Authorized Use Policy.II. Potential Grounds for Employer Liability.

I. Criminal Activities.I. Transmitting or receiving child pornography.II. Sexual predators.III. Misappropriation of Confidential InformationIV. Copyright InfringementV. Employees downloading music, videos, etc.

I. P2P suits by RIAA & MPA against businessesVI. Sexual Harassment - Hostile work environment based on employees:

I. Viewing adult materials on their computers.II. Emailing inappropriate or offensive materials around the

office.III. Discrimination.IV. Defamation.V. LibelVI. Employee sabotage.

Internet Issues Affecting Employment Law Pg 2I. Duty to act if employer becomes aware of use of company technology for improper

illegal purposes.I. Doe v. XYC Corp., 382 N.J. Super 122 (App. Div. 2005).

I. Court held company had duty to investigate once it was on notice that employees were accessing porn.

II. Blakey v. Continental Airlines, Inc., 164 N.J. 38 (2000). I. Continental held liable for Electronic Bulletin Board comments by male

pilots concerning female pilots.

II. Potential immunity defense for employers via Communications Decency Act of 1996, 47 U.S.C. § 230.

I. Section 230(c) (1) – immunizes interactive service providers when information provided by another information content provider.

I. Delfino v. Agilent Technologies, Inc., 145 Cal. App. 4th 790 (2006).

I. Court granted employer’s motion for SJ on grounds that they were immune.

Internet Issues Affecting Employment Law Pg 3I. Immunity under CDA Sec. 230.

I. Statute pre-empts state and local law.

II. Covers all types of interactive computer services including blogs, forums, listservers as long as content comes from 3d parties.

III. Statute has been used primarily in defamation cases, but has been extended to protect publishers in privacy, misappropriation and even negligence suits.

I. Doe v. MySpace 474 F. Supp. 2d 843 (W.D. Tex. 2007.

I. sexual assault case that grew out of a social network contact.IV. Doesn’t cover criminal charges, intellectual property claims.

Internet Issues Affecting Employment Law Pg 4Employer Monitoring of Employees’ Online Conduct outside the Workplace.

I. Significant risks to employers for employees’ off-duty conduct on the internet.

I. Disclosure of proprietary information.

II. Damage to employer’s reputation.

III. Damage to Public image.

IV. Torts i.e. intentional interference.

V. Inappropriate relationships with competitors.

II. Risks to taking action against employees based on off-duty conduct.

I. Common law privacy.

II. Lifestyle Discrimination laws.

I. About 30 States have Lifestyle Discrimination laws.

Internet Issues Affecting Employment Law Pg 5I. Public employers must be aware of First and Fourth Amendment rights.

I. Curran v. Cousins, 509 F.3d 36 (1st Cir. 2007).

I. Freedom of speech issues by public employees.

II. Quon v. Arch Wireless, 529 F.3d 892 (9th Cir. 2008).

I. Arch Wireless sanctioned for releasing files.

II. City sanctioned for reading employee texts despite AUP authority because supervisors said City would not review.

II. Retaliation issues under certain laws, i.e. Railway Labor Act, NLRA.

I. Can’t terminate for discussing salaries & employee policies.

III. Potential protections under whistleblower laws, i.e. Sarbanes-Oxley Act.

I. Claim for termination in violation of public policy, i.e. where employee blogs regarding safety issues at work.

Internet Issues Affecting Employment Law Pg 6I. Employer Use of Social Networks, Blogs, and Other New Technologies.

I. New Media Problems.

I. Productivity drain.

II. Employers should monitor their own blogs, sites, etc. very carefully.

I. Blakey v. Continental Airlines, Inc., 164 N.J. 38 (2000).

III. Risks of Employer Use of the Internet as a Recruitment and Applicant Information Tool.

I. Limits to how employers can use the information they acquire.

1. Privacy, First/Fourth Amendment issues may equally apply to applicants.

2. Potential trouble if employers use pretext or fabricate an identity to penetrate a candidate’s social network (particularly with respect to privacy issues).

1. Becoming aware of a fact that puts an applicant in a protected class will make it difficult to prove that such information did not affect the employment decision.

2. Information found on the internet is not always accurate.

Web Law 101An Overview of Internet Law

Presented by Andrew M. JaffeFor the Akron Bar Association

December 10, 2010

Copyright 2010 Andrew M. Jaffe

Our Practice Areas include:

Terms of Service and Privacy Policies Web Site Trademark & Copyright issues Domain Disputes Defamation, Slander and Libel Issues Can-Spam Act of 2003 - Education,

Compliance and Audits Can-Spam Litigation Telemarketing Rules ISP Relationships

Andrew JaffeAttorney at Law

Practice Limited to Internet Law

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Andrew M. JaffeAttorney at Law

3359 South Smith RoadFairlawn, OH 44333

(330) 666-5026attorneyjaffe@aol.com

fax (206) 203-3649www.netlaws.us

Practice Limited to Internet Law