This past November, the Virginia Supreme Court overruled a 1989 opinion on the wording of non-compete clauses.  In Home Paramount Pest Control v. Shaffer, the court held Home Paramount’s non-compete clause to be too broad, thus reversing a 22-year old decision in which the same court had upheld the same employer’s almost identical language.

Justin Shaffer, the defendant in Home Paramount Pest Control, signed an employment agreement in connection with his hiring by the pest control company in January 2009.  The agreement contained a non-competition clause forbidding Shaffer for two years from engaging in a pest control business in any area that he had worked as an employee of Home Paramount, specifically:

The employee will not engage directly or indirectly or concern himself/herself in any manner whatsoever in the carrying on or conducting the business of exterminating, pest control, termite control and/or fumigation services … in any city, cities, county or counties in the state(s) in which the Employee works and/or in which the employee was assigned during the two (2) years from and after the date upon which he/she shall cease for any reason whatsoever to be an employee of [Home Paramount].

Shaffer resigned from Home Paramount in July 2009, and soon thereafter began work at a competing pest control business.  Home Paramount then filed a complaint against Shaffer claiming he had violated his non-compete clause.  Shaffer responded by filing a plea contending that the provision was legally overbroad and therefore unenforceable.  The circuit court of Fairfax County ruled in favor of Shaffer, holding that the provision was indeed overbroad and therefore unenforceable.  On appeal, the Virginia Supreme Court affirmed. Continue reading

A recent New York Times article discussed the case of an artist was sued for copyright infringement after he created paintings and collages based on photographs without crediting or obtaining permission from the photographer.

The artist, Richard Prince, based his works on photographs from a book about Rastafarians “to create the collages and a series of paintings based on [those photographs],” reported Randy Kennedy in the Times.

Then ensued a discussion of the degree to which material must be transformed to fall under copyright law’s “fair use” protection, which would allow use of copyrighted material if, as the article explains, “the new thing ‘adds value to the original’ so that society as a whole is culturally enriched by it.”  (The reference is to a 1990 Harvard Law Review article by Federal Judge Pierre Leval.  I previously discussed fair use’s 4-prong analysis in the context of photographs and artwork, here and in mashups here.) Continue reading

Unlike traditional newsroom journalists, “citizen journalists” have no formal way to ensure that everyone maintains similar quality standards.  Which does not mean that quality standards are necessarily (or consistently) maintained at traditional newsrooms, but rather that a traditional hierarchical editorial structure imposes at least theoretical guidelines.

By definition, citizen journalism’s inherent difference from the traditional editorial process is the dispersion of responsibility for editorial choice.  Nonetheless, “trustiness” in journalism is a concept still heavily dependent on a reporter’s or editor’s reputation.  Is the New York Times trusted because it’s trustworthy?  Or is it trustworthy because it’s trusted?

The “Generated By Users” journalism blog recently reported the results of its reader poll, “Do you TRUST user generated content in news?” Continue reading

What is a “trademark use”?  This question comes up in this way: You want to use a trademarked name or brand or logo (not yours).  You want to make commentary about the trademark, or simply reference the trademark in some way.

Trademark protections give their owners the right of exclusive use to the trademark, but only when used “as a trademark”.  If the use of the mark is for any purpose not a “trademark use”, that use does not fall within the exclusive rights of the trademark owner.

The Good and The Ugly – Trademark Use Examples

Some examples illustrate the point:

1. A magazine story features a photograph of a woman wearing a tee-shirt with picture of a Marvel Comics character.  The story is about the woman and her battle with a difficult disease, having nothing to do with the Marvel trademark.  The trademark is clearly incidental to the photo and to the story.

2. A cash-for-gold jewelry dealer in Toronto (featured in a New Yorker profile this past week) promotes his business through television commercials featuring the character “Cashman” dressed in a red cape and pair of blue tights and dollar signs on his chest.  “Cashman” bursts out of telephone booths to frighten desperate Torontonians into parting with their family heirlooms.  The owner of the Superman trademarks felt compelled to ask – nicely at first, not so nicely in the subsequent lawsuit – that “Cashman” stop trading on the Superman goodwill.

Continue reading

One unintended consequence of the accelerating popularity of HTML5 for mobile app development is an ability to skate past Apple’s App Store restrictions on in-app sales.  So I put this question to Piotr Steininger of Tapangi Consulting:

There’s talk out there about being able to use HTML5 to get around Apple’s App Store ban on charging for in-app purchases.  In other words (I think), somehow HTML5 allows content producers to get around this problem by making apps (and other things) downloadable directly through web browsers.  So … how is it that HTML5 allows getting around this issue?

Some background: Apple announced a policy change earlier this year, specifically in Section 11.14 of its App Store guidelines, Continue reading

In March of this year, the U.S. District Court for the District of Maryland denied the preliminary injunction that the Pennsylvania “Field of Screams” had sought against the Maryland “Field of Screams.” Andrew Mirsky wrote about this case last fall, a trademark infringement action involving a haunted amusement house in Pennsylvania operating under the name “Field of Screams” and a Maryland operation of the same name.

The court’s opinion denying the preliminary injunction can be viewed here.  The preliminary injunction was denied on the grounds that the plaintiff was unable to show that its case was likely to succeed in court – the standard required to obtain a preliminary injunction.   Continue reading

In June of this year, Senator Al Franken (D. Minn.) introduced the “Location Privacy Protection Act of 2011” (S. 1223).  According to the bill summary available on Franken’s website, a 2010 investigation by the Wall Street Journal revealed that 47 of the top 101 mobile applications for Apple iPhones and Google Android phones disclose user location without consent of the user.

According to Franken’s bill summary, current law prevents disclosure of user location during telephone calls without user consent. Currently, no similar legislation protects user location when a user accesses information through a mobile web browser or mobile application. Franken claims that his bill will close loopholes in the Electronic Communications Privacy Act that allow for this distinction.

If S. 1223 passes, companies will be required to obtain permission not only to collect mobile user location information but also to share that information with third parties. Additionally, the bill seeks to put in place measures to prevent stalking through location information.

As of this writing, Franken’s bill has been assigned to the Senate Judiciary Committee and is being cosponsored by Sens. Blumenthal, Coons, Durbin, Menendez, and Sanders.

Original Post (published 9/8/2011)

When was the last time you read a license agreement after installing software or downloading an app on your smartphone? If you’re like most people, the answer is probably never.

According to some estimates, fewer than 8 percent of us actually read the entirety of those agreements, despite rising concerns about digital privacy and data collection. Continue reading

Sector Labs, a California company that makes a smartphone-size video projector, filed a federal trademark registration in 2003 for the name “video pod”.

Apple, Inc. challenged the registration, filing an opposition to Sector Lab’s registration with the U.S. Patent and Trademark Office.  Apple claimed (among other things) that Sector Labs’ “video pod” “is extremely similar to Apple’s [“iPod” trademarks]”, “consists in part of a significant portion of [iPod] and the entirety of POD, which consumers use as an abbreviation to identify and refer to Apple’s iPod mark and products”, and that Video Pod “covers a device that is or will be used to transmit video for entertainment and other purposes” – much like Apple’s iPod.

Apple’s legal position is that Sector Labs registration would cause source confusion, namely a likelihood of confusion among consumers as to the source of the two companies’ products, and trademark dilution.  Or in other words, “video pod” would dilute the value of Apple’s iPod franchise by reducing the exclusive association in the marketplace of “pod” with Apple and its ubiquitous iPod. Continue reading

Kate Tummarello is a Research and Social Media Intern with Mirsky & Company and a reporter at Roll Call/Congressional Quarterly.  Follow Kate on Twitter @ktummarello.  Andrew Mirsky of Mirsky & Company contributed to this post.

Gone are the days of bashing your boss in the breakroom. Now, colleagues gather online to anonymously air their grievances.  A group of disgruntled Demand Media, Inc. employees did just that with their website DemandStudiosSucks.com.  Then Demand Media struck back.

Late last month, attorneys for Demand Media, a content production company whose properties include eHow, LIVESTRONG.com, Cracked.com, typeF.com, Trails.com and GolfLink, sent a letter to DemandStudiosSucks.com asking it to remove content that had been copyrighted by Demand Media.

The media company accused the people behind this censorious website of creating and maintaining “a forum in which users can, and do, post and misuse Demand Media’s trademark, copyrighted material, including confidential and proprietary copy editing tests.”  The letter also referenced “an internal presentation regarding the company’s business plans”, published without permission on DemandStudiosSucks.com.

Immediately, of course, the letter was posted on DemandStudiosSucks.com.

The next day, a user named “Partick O’Doare,” who has posted the majority of the content on the site, published an open letter addressing the claims made by Demand Media’s attorneys.  Although the website removed the content addressed in the letter, O’Doare explained that the site’s creators had not acknowledged any infringement in removing the content.

Instead, those behind the website claimed that their use of the Demand Media content fell under fair use guidelines, specifically protections for commentary and criticism.  “Let’s be honest,” the open letter says, “if ever there was a case of unequivocal fair use, this would be it.”  A statement which should raise flags to anyone who previously felt similarly.

Fair use is a defense to a claim of copyright infringement, but not other claims.  A fair use argument cannot simply succeed on its merits where other legal rights are violated.  Context matters.  So, for example, as seen in some Facebook “suck site” cases, fair use will not protect against a claim of defamation.  Employees who publish company trade secrets and other proprietary information cannot rely on fair use to defend against claims of violations of corporate and employment law.

O’Daire’s letter proudly boasts that the voices behind DemandStudiosSucks.com were fully prepared to defend themselves, citing the fair use cases Lenz v. Universal Music Corp. and Online Policy Group v. Diebold, Inc.

Earlier this month, Dropbox spawned a new kerfuffle in internet-land with changes to its Terms of Service (TOS).

The outrage was fast and furious.  A nice deal of blog and Tumblr and other commentary zeroed in on changes Dropbox announced to its TOS before the 4^th of July holiday, and in particular how this or that provision “won’t hold up in court”.  See for example J. Daniel Sawyer’s commentary here.

Sawyer was referring to language in the TOS for cloud-server services granting ownership rights to Dropbox or other cloud services.

At least I think that’s what he was referring to, because the Dropbox TOS did not actually grant those ownership rights to Dropbox.  Dropbox’ TOS – like similar TOS for SugarSync and Box.net – granted limited use rights to enable Dropbox to actually provide the service.  Here is the offending provision:

… you grant us (and those we work with to provide the Services) worldwide, non-exclusive, royalty-free, sublicenseable rights to use, copy, distribute, prepare derivative works (such as translations or format conversions) of, perform, or publicly display that stuff to the extent we think it necessary for the Service.

To be clear, if Dropbox actually claimed ownership rights to customer files – and actually provided for the same in its TOS – there’s no particular reason such a grant “won’t hold up in court”.   There are certainly cases of unenforceable contracts – contracts that are fraudulently induced or in contravention of public policy, for example – but a fully and clearly disclosed obligation in exchange for a mutual commitment of service is enforceable. Continue reading