what you don’t know about the internet can hurt you

1
What You Don't Know About the Internet Can Hurt You Arnold B. Silverman Use of the Internet has been increas- ing at an exponential rate with prime focus directed toward the numerous benefits offered. Unfortunately, the fact that a work can be digitized, stored, modified, or produced easily and quick- ly and transmitted throughoutthe world within minutes in an uncontrolled and frequently untraceable manner not only provides benefits to users, but also raises some potentially serious legal questions. Whether using the Internet for e-mail communications, participation in news- groups (referred to as Usenet), or the World Wide Web, one must be careful. There are risks of violating the intellec- tualpropertyrights of another (e.g., copy- right, trade secret, and trademark rights ) as well as difficulty with other areas of the law (e.g., defamation). Also, a person must avoid undesired dissemination of his or her own proprietary information. One of the legal problems a user might easily drift into is copyright infringe- ment. There are cases holding that even the making of a temporary copy in the random-access memory of a computer can violate another's copyright. A copy- right owner in the United States has the exclusive right to reproduce the copy- righted work in copies, to distribute cop- ies of the work to the public, and, in certain works (e.g., literary, musical, dra- matic, and choreographic works and motion pictures) to publicly perform and/ or display the work. In addition, the copyright owner has the exclusive right to make derivative works, which are based upon one or more copyrighted works. A derivative work, in general, involves the making of a new work that carries with it a significant amount of the original work so as to make it recogniz- able as having been derived from the original work. In accordance with the White Paper that was issued on Septem- ber 5,1995, by President Clinton's Work- ing Group on National Information In- frastructure and Intellectual Property Rights, there is pending legislation that would make unauthorized digital trans- mission of a copyrighted work an act of copyright infringement as a violation of the distribution right. The bottom line is that someone who uses the Internet to access information that is copyrighted may run a risk of infringing a copyright. In some instances, the person placing 72 the material on the Internet will grant an express limited license to use the mate- rial or, alternatively, may require ex- press consent to the terms of an on-line license before permitting access to the material. Further, in some instances the nature of the communication (e.g., ca- sual Usenet exchanges) may imply that permission for others to use the material has been granted. Also, some uses of copyrighted material that might other- wise be deemed an infringement are permitted as fair use under the Copy- right Act. In general, use for criticism, comment, news reporting, or teaching (including multiple copies for classroom use, scholarship, or research) is permit- ted as fair use. As to works going beyond this specific list, the purpose and charac- ter of the use, the nature of the copy- righted work, the qualitative and quan- titative amounts of work that were used, and the affect of the use on the potential market for a copyrighted work are gen- erally reviewed. A person who infringes a copyrighted work can not only be liable for damages and be subject to an injunction, but can also (if the copying is willful copyright infringement for purposes of commer- cial advantage or private financial gain) face criminal penalties. In order to bring certain computer hackers within the criminal provisions of the Copyright Act, pending federal legislation would make it a crime to willfully infringe a copy- right by reproducing or distributing soft- ware having a retail value of $5,000 or more even if there is no profit motive. A person may also be liable for trade- mark or service mark infringement as a result of making unauthorized use on the Internet of a mark that is identical to or confusingly similar to one in which another has prior rights. Divulging the trade secrets of another on the Internet without authority to do so may also result in liability. Viewing the matter from the other direction, one must be careful in placing his or her own copyrighted material and confidential information on the Internet. It is important to exercise suitable pre- cautions in determining what will be placed on the Internet and to what ex- tent the information will be exposed to others. For example, a limited e-mail dissemination is very different from dis- seminating the information through a home page on the World Wide Web. Another very important consideration on the Internet is security. People often assume that Internet communications provide a high level of security. This is not necessarily so. Internet security should be considered no greater than that of a cellular phone and, perhaps, no more secure than a postcard going through the mail. Information traveling on the Internet passes through a number of host computers called message trans- fer agents (MTA). Information traveling on the Internet travels in a series of pack- ets. There are electronic eavesdropping devices such as those known as packet sniffers by which knowledgeable com- puter hackers can seize sequential pack- ets of information at an MT A and recon- struct a document. One obvious security measure is to limit the access of users within a given organization by requiring a suitable log- in name and password. Different users can be provided with different levels of access. There are also "firewalls" that filter materials and, therefore, minimize an intruder's ability to interfere with the desired secure operation of the system. Another popular approach to security is the use of encryption and decryption techniques, whereby the information is encoded and decoded, respectively, be- fore transmission and after receipt. The encryption key may be private or pub- licly available, depending on whether a large group of people would be able to encrypt information or only a limited group. The decryption key is generally private, with only a limited number of users being provided the ability to de- code a document. There are also means for applying digital signatures to a docu- mentso as to authenticate both the source of the work and the contents of the file. A system known as steganography per- mits provision of a digital fingerprint encoded in a digital message that cannot be deleted from the file. In short, Internet users must be careful to avoid the undue risk of legal prob- lems. Arnold B. Silverman is a partner with Eckert Seamans Cherin & Mellott in Pittsburgh, Pennsylvania. For more information, contact A.B. Silverman at Eckert Seamans Cherin & Mellott, 600 Grant Street, 42nd Floor, Pittsburgh, Pennsylvania 15219; (412) 566-6000; fax (412) 566-6099; e-mail [email protected]. JOM • July 1996

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Page 1: What You don’t know about the internet can hurt You

What You Don't Know About the Internet Can Hurt You Arnold B. Silverman

Use of the Internet has been increas­ing at an exponential rate with prime focus directed toward the numerous benefits offered. Unfortunately, the fact that a work can be digitized, stored, modified, or produced easily and quick­ly and transmitted throughoutthe world within minutes in an uncontrolled and frequently untraceable manner not only provides benefits to users, but also raises some potentially serious legal questions. Whether using the Internet for e-mail communications, participation in news­groups (referred to as Usenet), or the World Wide Web, one must be careful. There are risks of violating the intellec­tualpropertyrights of another (e.g., copy­right, trade secret, and trademark rights ) as well as difficulty with other areas of the law (e.g., defamation). Also, a person must avoid undesired dissemination of his or her own proprietary information.

One of the legal problems a user might easily drift into is copyright infringe­ment. There are cases holding that even the making of a temporary copy in the random-access memory of a computer can violate another's copyright. A copy­right owner in the United States has the exclusive right to reproduce the copy­righted work in copies, to distribute cop­ies of the work to the public, and, in certain works (e.g., literary, musical, dra­matic, and choreographic works and motion pictures) to publicly perform and/ or display the work. In addition, the copyright owner has the exclusive right to make derivative works, which are based upon one or more copyrighted works. A derivative work, in general, involves the making of a new work that carries with it a significant amount of the original work so as to make it recogniz­able as having been derived from the original work. In accordance with the White Paper that was issued on Septem­ber 5,1995, by President Clinton's Work­ing Group on National Information In­frastructure and Intellectual Property Rights, there is pending legislation that would make unauthorized digital trans­mission of a copyrighted work an act of copyright infringement as a violation of the distribution right.

The bottom line is that someone who uses the Internet to access information that is copyrighted may run a risk of infringing a copyright.

In some instances, the person placing

72

the material on the Internet will grant an express limited license to use the mate­rial or, alternatively, may require ex­press consent to the terms of an on-line license before permitting access to the material. Further, in some instances the nature of the communication (e.g., ca­sual Usenet exchanges) may imply that permission for others to use the material has been granted. Also, some uses of copyrighted material that might other­wise be deemed an infringement are permitted as fair use under the Copy­right Act. In general, use for criticism, comment, news reporting, or teaching (including multiple copies for classroom use, scholarship, or research) is permit­ted as fair use. As to works going beyond this specific list, the purpose and charac­ter of the use, the nature of the copy­righted work, the qualitative and quan­titative amounts of work that were used, and the affect of the use on the potential market for a copyrighted work are gen­erally reviewed.

A person who infringes a copyrighted work can not only be liable for damages and be subject to an injunction, but can also (if the copying is willful copyright infringement for purposes of commer­cial advantage or private financial gain) face criminal penalties. In order to bring certain computer hackers within the criminal provisions of the Copyright Act, pending federal legislation would make it a crime to willfully infringe a copy­right by reproducing or distributing soft­ware having a retail value of $5,000 or more even if there is no profit motive.

A person may also be liable for trade­mark or service mark infringement as a result of making unauthorized use on the Internet of a mark that is identical to or confusingly similar to one in which another has prior rights. Divulging the trade secrets of another on the Internet without authority to do so may also result in liability.

Viewing the matter from the other direction, one must be careful in placing his or her own copyrighted material and confidential information on the Internet. It is important to exercise suitable pre­cautions in determining what will be placed on the Internet and to what ex­tent the information will be exposed to others. For example, a limited e-mail dissemination is very different from dis­seminating the information through a

home page on the World Wide Web. Another very important consideration

on the Internet is security. People often assume that Internet communications provide a high level of security. This is not necessarily so. Internet security should be considered no greater than that of a cellular phone and, perhaps, no more secure than a postcard going through the mail. Information traveling on the Internet passes through a number of host computers called message trans­fer agents (MTA). Information traveling on the Internet travels in a series of pack­ets. There are electronic eavesdropping devices such as those known as packet sniffers by which knowledgeable com­puter hackers can seize sequential pack­ets of information at an MT A and recon­struct a document.

One obvious security measure is to limit the access of users within a given organization by requiring a suitable log­in name and password. Different users can be provided with different levels of access. There are also "firewalls" that filter materials and, therefore, minimize an intruder's ability to interfere with the desired secure operation of the system. Another popular approach to security is the use of encryption and decryption techniques, whereby the information is encoded and decoded, respectively, be­fore transmission and after receipt. The encryption key may be private or pub­licly available, depending on whether a large group of people would be able to encrypt information or only a limited group. The decryption key is generally private, with only a limited number of users being provided the ability to de­code a document. There are also means for applying digital signatures to a docu­mentso as to authenticate both the source of the work and the contents of the file. A system known as steganography per­mits provision of a digital fingerprint encoded in a digital message that cannot be deleted from the file.

In short, Internet users must be careful to avoid the undue risk of legal prob­lems.

Arnold B. Silverman is a partner with Eckert Seamans Cherin & Mellott in Pittsburgh, Pennsylvania.

For more information, contact A.B. Silverman at Eckert Seamans Cherin & Mellott, 600 Grant Street, 42nd Floor, Pittsburgh, Pennsylvania 15219; (412) 566-6000; fax (412) 566-6099; e-mail [email protected].

JOM • July 1996