Dozier Internet Law, by John W. Dozier

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Dozier Internet Law Review of Recent Legal Developments, by John W. Dozier

November 27, 2007

Dozier Internet Law is continuing to monitor proactively legal developments in the US and in other countries. In France, the 19% Value Added Tax for delivery by foreign (yes, US) businesses supplying software updates, electronic data, distance learning, online subscriptions, and other electronic services to French citizens, even if the US business has no other connection to the country, is authorized and supported by an EU directive. Also, an agreement has been reached between the French government, ISPs, and film and music rights owners that will punish illegal downloaders of copyright protected music and films by cutting off their internet access. "The Internet must not become a high-tech Far West, a lawless zone where outlaws can pillage works with abandon or, worse, trade in them in total impunity. And on whose backs? On artists' backs," the French President stated upon announcing the new anti-piracy program.

In Canada, on the tail of proposed legislation that could create a Canadian DMCA-like copyright infringement take-down notice tool, a defamation judgment has been entered against the director of the Canadian Association for Free Expression in the sum of $20,000 in compensatory damages and $10,000 in punitive damages for nine defamatory postings.

In the EU, and Antigua and Barbuda, sanctions are on the way against the US for banning online gambling in apparent violation of the World Trade Organization Treaty in which each member pledges not to institute a law or policy that would have a materially adverse economic impact on other members. Antigua and Barbuda claim that a huge percentage of their Gross National Product is generated from online gambling, which is illegal in the US and subject to stepped up enforcement measures here.

And in the US, the State of Pennsylvania is now requiring third party sellers on e-Bay to get auctioneers' licenses, and this requirement is not necessarily limited to in-state sellers. In Missouri, a town ordinance has been passed prohibiting cyberbullying after the suicide of a 13 year old after receipt of intentionally hurtful messages on MySpace. Expect this to be the first of many efforts at the local, state and federal level to address this perversion of free speech, and expect to see the ACLU, Public Citizen, and other "consumer rights" organizations attack the laws through lobbying and lawsuits. And in California, the use of another party's name in a chatroom to identify the "poster" almost resulted in criminal indictments after an FBI investigation. This form of "online identity theft" in chat rooms (and by implication in blogs, forums and websites) can result in criminal liability for impersonating another person under either forgery, fraud, or identity theft common law.

Dozier Internet Law continues to monitor and evaluate developments in the law of the web. Right now it looks like the laws and decisions are continuing to catch up with the "Wild West" mentality that is so prevalent among the "scofflaws" of the web. It's good to remember that some pioneers get arrows in their backs, I guess.

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Copyright Rights and Free Speech, by John W. Dozier

January 29, 2008

Some get it. Some don't. And some simply don't want to, or can't. I guess that is a fair assessment of the comments about our recent Press Release on the US District Court holding that copyright rights can arise in a lawyer cease and desist letter. As we reported, the Court confirmed the issuance of a subpoena aimed at identifying the poster, and found on a prima facie basis that copyright rights existed in the demand letter. Considering the fact that just months before Public Citizen had attacked our firm for asserting such ownership rights, and created a firestorm of comments attacking the very concept of a cease and desist letter being subject to copyright protection, it seemed appropriate to comment on the decision. It still does. The Press Release is accurate, but some of the blogosphere took the release, added words and associated meanings to the non-existent words, and then explained why what I had not said was incorrect. Others simply attacked the judge for erroneous logic and purported errors of law.

Okay, so here we go again. Let me explain the decision in plain terms. The Court found that a lawyer or client can have copyright protection in a Cease and Desist. First Amendment and Fair Use defenses were raised by the defendant, and despite such defenses the Court approved the subpoena. Some will argue he never considered those defenses, some will argue he did consider them and rejected them as not persuasive, and some will argue that it does not make any difference since such defenses are case specific and fact sensitive to each situation.

The impact of this decision is that the first requirement for establishing a copyright infringement claim against a party posting a lawyer cease and desist is supported. Many free speech commentators attacked this belief previously. Of course, those commentators are some of the same ones who claimed you had to have a registered copyright to assert copyright rights, and when they learned that was wrong then they fell back to the position this US District Court has now rejected. So, they now fall even farther back to the "fair use" defense. Get any idea in which direction this is going? Not much left after that to fall back on, frankly.

Some commentators have praised this decision. Others have attacked it. Others have attacked our interpretation of it, focusing on the "fair use" argument. I really get a bit of a chuckle out of the liberal "free speech" types who have never spent a day in their life in a business setting, never attended a board meeting, never had to make payroll for employees, and cannot tell you the difference between an income statement and a balance sheet. They couldn't see things from the eyes of businesses no matter what the situation. They can come up with all kinds of arguments and purported authority for the proposition that if you receive a cease and demand letter you can post it online without risk. They tell the blogosphere that it can do something that could lead to an award against them for $150,000 in statutory damages plus much more in attorney fees; do something that could lead to financial ruin for the gullible netizen and his family for the remainder of their lives. What they do not tell you is that asserting a fair use defense is going to be fact and case sensitive; in some matters you may succeed, in some matters you may not succeed, and that the Courts are still dealing with many of these issues for the first time.

Do the free speech groups really believe in free speech? No. Just speech they agree with. Free speech is a noble concept in their minds, but their minds are clouded by a bias and prejudice against businesses. Consider the irony of FREE SPEECH GROUPS PROTECTING TACTICS USED TO SILENCE CRITICISM. That is what their "fair use" defense does. Let's walk through this for a moment.

Your business is attacked viciously online with damaging lies. If your business lawyer criticizes the blogger, and demands a retraction, you know that there is a real possibility this blogger could publish your letter and create a "mobosphere" attack on your business that would far outweigh the damage to date. Your business is inhibited from voicing your criticism because of the fear of reprisal, and the primary fuel for this reprisal is the threat of publication of your criticism. Free speech groups actually encourage their constituents to post these demand letters, providing further high profile attention to the issue and participating in the "mobosphere" attack. Why are the letters published? To discourage businesses from voicing their criticism of the blogger criticizing the company. Since when did free speech protections not apply to businesses?

And so, from free speech comes a claim of "fair use". Is it fair use to publish a lawyer demand letter, even when the recipient is free to comment on the letter and issues surrounding it, and can likely even publish insubstantial parts of it? No, it is not. The "fair use" argument is a red herring, repeated so often that those who argue its applicability actually believe it. Let's not ignore the reason for the publication. It is not to inform the public. That can be done through comment and criticism. The first intended use is for it to chill the rights of businesses to speak without fear of a mob attack. It is often published to incite an overwhelming force to attack a business in many ways, both legal and illegal, and to intimidate businesses into submission. The publication itself, in this context, is an attack on our free speech rights. Chilling effect is an understatement.

The second is even more obvious. If the business decides to move forward, the recipient uses the threat of posting it to gain an advantage in the legal dispute. The threat is not one founded upon the public's right to know. It is founded upon a belief that the threat of publication of the cease and desist letter will get the recipient a better "financial settlement", which is often a nice way of saying that "if you pay me off I will stop the attacks and remove the postings about your company, and if not, well, you'll have to suffer the consequences ". That, my friends, smells of extortion. But it happens every day. These public interest and free speech groups know it, and I suspect they greatly appreciate the generous donations coming in. How important are donations? Reportedly important enough for Public Citizen to "fire" Ralph Nader when donations dropped after his presidential bid. Many suggest it has been slipping into mediocrity and irrelevance ever since, and Public Citizen is scrambling to keep the contributions coming in.

The equities weigh in favor of not recognizing "fair use" as a defense to this copyright infringement claim. The applicability of the First Amendment isn't limited to members of Public Citizen, the ACLU, or the Electronic Frontier Foundation. The most important aspect of free speech this issue implicates is the chilling effect visited upon businesses from the threat of a mobosphere attack. The lawlessness of the web is a big enough problem without having public interest groups pushing a self serving agenda that protects the scofflaws of the web.

Coming Up Soon: We're working on a piece that lays out the organization and dynamics at play in a "mobosphere" attack. You won't be surprised, unfortunately, to find out who is providing the legal support, on many different fronts, for these attacks, and we'll get into how the payoffs are solicited, who gets paid first, and how the bounty is shared among the participants. Fair Use? You be the judge.

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Dozier Internet Law on The Scary and Unknown Weapon of Contributory Copyright Infringement, by John W. Dozier

April 30, 2008

Dozier Internet Law handles alot of e-commerce and website legal audits. That means that we review a website and e-commerce business and "get it legal". That is becoming more and more difficult because we have to look into the future and figure out where legal doctrines are headed and what the popular lawsuits will be about in two or three years. Because, as our clients learn, what they do today may not have an impact on them for years. It would be a shame to be doing something today that you learn three years from now was illegal.

And to do this effectively Dozier Internet Law, as a litigation law firm, often sees the evolving issues very early on. Our Dozier Internet Law Federal Court Report serves as a monitor and advance early warning avoidance system, in a sense, for web businesses to understand what will get you sued. But you really have to live the law of the web day in and day out, have a firm grasp of technology, be intimately familiar with the business of the web, and have a great imagination to see the future. We don't claim to be perfect, but here is some food for thought on a legal risk that could lead to your company being sued for copyright infringement.

Under Section 512 "safe harbor" protection, a business can avoid copyright infringement liability if you do certain things at certain times. So, if you have a music site, and you follow the Digital Millennium Copyright Act provisions, you likely won't be sued or have liability unless your site is reliant in some material respect on the copyright infringement occurring. Under the doctrine of "contributory copyright infringement", liability for copyright infringement extends to business partners who are intentionally inducing or encouraging the direct infringement. So, if you know or should know of the infringing conduct, are advertising on a site that is carrying copyright infringing materials, you are providing services and support for the infringing site, you are a payment processor or even a web host or web developer, or you are somehow monetarily benefiting from the traffic at the site, you may be asked in a not so gracious way to assist the courts in defining who is liable as a contributory copyright infringer in the online world. And these lawsuits will be filed against individuals even though the small business is a corporation. That's a pretty scary possibility. But that is where I see things headed, and the only issue will be where the courts will draw the line of liability...what concepts, doctrines and rules of law will be adopted from the case law to apply to an online business world operating in an entirely new way? No one knows. But we can make an educated and informed guess. And that is what we at Dozier Internet Law do just about every day.

Sure, it's guesswork. If you can't see the trees because of the forest, this arena is not a place for you as a business person. As Internet lawyers we have to not only see the trees, but the saplings that will become the forest. And sometimes we have to see the seeds that will become the saplings that will become the trees that will become the forest.

If you want to avoid liability for contributory copyright infringement you need to know a lot about the business practices of your customers, business partners, and affiliate marketers. Pleading ignorance may be a successful defense, and I am sure one that will be used in virtually every case by the defendants. If you have a six figure legal budget to fight the lawsuit you may like your chances. But the smart thing to do is to make an informed decision. We help with that.

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MySpace Hacking Indictment Well Supported, by John W. Dozier

May 17, 2008

The federal prosecutors in California obviously did their legal research before asking the grand jury to indict under the Computer Fraud and Abuse Act in the myspace.com suicide case. I don't like the statute's seemingly over-broad reach. I've criticized the statute in the past for the very same reasons some of the free speech liberal commentators object all over the airwaves today. The difference, however, is that I don't pretend to make the law mean what I would like for it to mean. It is what it is. And, as it is written, the prosecutors believe they are right, I think they are right, and the 9th Circuit does too!

Wonder if the prosecutors read my blog entry from last June about Dozier Internet Law and our view on the law of hacking? And I wonder how many of these law professors and talking heads on TV have ever tried a hacking or unauthorized access case? Maybe the prosecutors are new to this, maybe they aren't. But at least they did their legal research. Commentators, particularly the "free speechers" expressing outrage over the indictment, should be so diligent. There's at least one law professor so outraged he is offering his legal services for free. A little research, Mr. Professor, may be in order. Here's why:

California is in the 9th Circuit. I suggest anyone interested in commenting on the case who also wants to sound somewhat knowledgeable read the Middleton v. US case decided by the 9th Circuit. I suspect the prosecutors will use this case to argue that unauthorized access causing damage or loss has already been recognized as a crime in the 9th Circuit. Lay on top of that decision another 9th Circuit case, Creative Computing v. Getloaded.com, which Dozier Internet Law argued before the 9th Circuit, and you can see that the rationale the prosecutors are using has already been established in the 9th Circuit Court of Appeals in a couple of decisions. The trial court HAS TO follow this case law from the 9th Circuit Court of Appeals! Anywhere else in the country and they would not have a trial court bound by this precedent. Smart prosecutors, I would say.

Visit the Dozier Internet Law Hacking page on our site and you can see that our interpretation has always been that such access in violation of a user agreement or terms of use violates not only the CFAA but also many, many state computer crime laws. For those who think that the CFAA applies only to damage to a computer, read the code sections again. And for those who believe that a damage or loss could not include personal injury or death, view the expansive definition of "loss". How could this statute evolve since its passage in the late 1990s to be so inclusive today? 9/11 and the Patriot Act, frankly. You can research the changes that were made to the law, review the legislative history, and read the Computer Fraud and Abuse Act from top to bottom. You may even want to re-read the Dozier Internet Law Hacker Blog Entry from last June in which I made the same points the prosecutor will likely be relying upon, and described a criminal hacking trial for which I was lead counsel in which the Judge also found that violating a terms of use is unauthorized access (won on other grounds).

No, this is not an unprecedented case. The FBI and Department of Justice recently raided our client's offices in Florida based on an alleged website user agreement violation. Another FBI investigation targeted a client for doing the same thing in Northern California. The concepts may seem novel or unique to those feigning expertise in this area of the law. But, the indictment is likely well grounded in law, and I am not surprised at all that the prosecutors brought charges under the CFAA. Particularly in California and the 9th Circuit.

The lesson, of course, is that those contracts you agree to online are binding, and those abusing a website and joining the world of online scofflaws had better watch out. I still don't like the statutes that associate hackers with non-malicious unauthorized access. But, no matter how hard the left wing, free speech commentators try, they can't change the law. They see it as they want it to be. We see it as it is. And it is what it is! Ask the 9th Circuit.

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November 1 Drop Dead Date for Compliance with New FTC ID Theft Rules, by John W. Dozier

July 16, 2008

Dozier Internet Law today issued a special advisory notice relating to the new Federal Trade Commission requirements for creditors set to go into effect on November 1, 2008. This is the date of compliance-which means that if you are an online business extending credit you may be covered under the law.

These new rules mandate the development and implementation of a written program that identifies and detects "red flags" of identity theft. The program must also describe appropriate responses that would prevent or mitigate the crime and detail a plan to update the program, must be managed by senior employees, and must include oversight provisions for contractors and third party service providers. The program documentation and business process needs to be reasonable given the nature of an online business, but this is an objective reasonableness. In other words, a small business owner's subjective thoughts of what is reasonable is not the measure of adequacy or compliance.

Dozier Internet Law provides coverage advice and assists in the drafting, documentation, and implementation of the processes required by these new rules. It is essential that if your online business takes credit card payments or otherwise extends, renews, continues, or receives through assignment credit commitments you have a qualified attorney determine if your business is covered by these "Red Flag" rules. While many of the indications of identity theft are already used by businesses to avoid credit losses, the key to compliance with the Federal Trade Commission rules, and avoiding prosecution, civil fines, and potentially devastating publicity that cuts to the core of a small business' customer relationships, is to document reasonable processes in a formalized manner.

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Hackers Hack Away at DefCon Annual Convention, by John W. Dozier

August 19, 2008



Defcon, the annual convention in Las Vegas, began August 8 and it looks like the hackers sitting in the audience and participating in the hacking competitions spent two days trying to hack into the Dozier Internet Law website using SQL Injection Attacks, Mambo Exploits, encoded cross site scripting attempts, shared ciphers overflow attempts, and the like. The frustrated perpetrators (they never got access) were sitting in the Riviera Hotel ballrooms, I suspect, listening to the presentations, and participating in the now infamous "free for all" where the attendees hack into systems in an "Olympian-like" competition to gain bragging rights. The attempts likely came through "backdoor" exploits of webservers around the globe. The favorite and most common ISP access was from Vietnam and China, with Beijing the host and doorway of the Olympic Games as well as many, many hackers.

The Electronic Frontier Foundation staffed a booth full of lawyers to help hackers deal with "bogus legal threats" (the EFF's own words). While attending to their session presentations, offering advice, and driving the underworld of the web to the annual EFF fundraiser, they were losing big time in Court. Then the EFF filed legal documents, released press releases, and held news conferences in which they claimed DefCon attendees are akin to "security researchers" that are gathered in Vegas to listen to presentations involving security.

That's absurd. The graph above shows what these hackers do. They come to Vegas to learn how to hack into systems and create havoc. Going after law firm websites and administration areas that contain attorney/client protected communications and documentation, and even court ordered "sealed" files, is a direct attack on the integrity of the judicial process and the judiciary. And our experience at Dozier Internet Law is just the tip of the iceberg.

This convention wouldn't even exist if the FBI, CIA, Department of Justice, and the National Security Agency and others weren't so anxious to infiltrate it every year for intelligence. Think about it. Hackers from around the world come together once a year and learn how to hack better. Those that support and encourage and facilitate these hackers cannot hide behind the "I didn't know they were hacking while I spoke" defense. Yes, there are researchers and intellectuals and law students and college professors in attendance. But, for the most part, there are hackers learning and improving their trade. And despite EFF's absurd contentions otherwise, the Computer Fraud and Abuse Act, as well as many state computer crime statutes, can and should be used to prevent the aiding and abetting that is the core benefit seen by most attendees.

"SECURITY RESEARCHERS"? Give me a break, Electronic Frontier Foundation. While your lawyers call the hacking laws "bogus", and tell hackers how they can ignore the "bogus" laws, all of the scofflaws are being emboldened by your advice and guidance. The only reason there isn't a round up and indictments for hacking, conspiracy and aiding and abetting is because your annual conference is infiltrated so extensively by the government that it provides a honeypot of intelligence. And adding some professors and other intellectuals to the mixing pot won't clean things up.

Notice to EFF: DefCon is for hackers. Many attendees commit criminal acts while in attendance in organized war games. Others commit criminal acts as they learn the tools of the trade in the very ballroom during speaker presentations. They hack into banks, into personal computers, into businesses, into government agencies, and steal private information, cost businesses billions of dollars annually, and ruin the financial well-being and impair the emotional stability of individuals all across our country. This is the mob of the 21st century; this is the mobosphere. They are hoodlums, thieves, scoundrels, and all too often already convicted felons after the next easy mark.

The only "security researchers" in attendance, I suspect, are the good guys. But then again, they don't need legal advice from EFF, do they?

8/26/08 Update: There have been some of the 9,000 attendees who have blogged this and defended DefCom by pointing out that there are bad eggs everywhere, and most of the attendees are "good guys".

Anyone can attend, unless, as real life experience tells us, you are a SPEAKER arrested by the Feds, a REPORTER "outed" by the Conference management and pursued by a mob of attendees, or a registrant intercepted at our border before getting into the US. Couple that with the session this year on how to hack a Boston public transit system and get "free fares for life" (interrupted appropriately by a Federal Court lawsuit and injunction), and the MSBlast Worm and Virus fiasco of several years ago where the Department of Homeland Security had to issue a global alert the day before the conference, and the many, many other incidents that are recorded for posterity online. And then lay on top of that the Electronic Frontier Foundation's prominent and high profile attendance and involvement at the conference attacking our computer crime laws as "absurd"...laws passed and strengthened post 9/11 by the US Congress.

Are the "good guy" attendees naive? Are they in a state of denial? Are they willing to overlook the "open access" problem in order to keep their employer picking up the tab for three days of partying, fun, gambling etc. in Vegas? Or are they enjoying the short time they have each year being exposed to the "dark side"?

So, here I am, getting feedback from those in the know that I "got it right on". And yes, I agree with some of the feedback I have received...the irony is not lost on me...supposed security professionals operating in an insecure and uncontrollable environment and unable, or unwilling, to recognize a huge and pervasive security risk.

Here are some suggestions: Establish some meaningful vetting of attendees, require full disclosure and contractual commitments, screen out the presentations that rely upon illegal hacking for the subject matter, get rid of the "aliases" used by attendees to hide identities, and act responsibly.

What happens in Vegas, stays in Vegas? If only that were true.

[admin]

New Affiliate Marketing Laws Go Into Effect October 1, 2008, by John W. Dozier

August 21, 2008

The affiliate marketing provisions of the Fair and Accurate Credit Transactions Act ("FACTA") go into effect October 1, 2008. Dozier Internet Law has added the compliance analysis to our legal audits. In a nutshell (it is really quite complicated) an affiliate marketer transferring leads or personally identifiable information to its advertiser requires advance notice to a consumer and an effective 30 day opt-out option.

Penalties? Up to $1,000 per violation (per each solicitation attempt), plus punitive damages and attorneys' fees. In other words, violations will likely bring class action lawsuits and create exposure that is enormous for affiliate marketers.

Dozier Internet Law recommends:

First: Every affiliate marketer consider its particular information-sharing and marketing practices, today and in the future, to determine whether a notice and opt-out opportunity must be given.

Second: Affiliates should consider whether Advertisers are categorizing the affiliate as subject to the Act, and if so determine whether Affiliate Marketing Agreements require compliance in the contract, even if the Affiliate Marketer is operating outside the scope of the Federal Law definition.

Third: Merchants, Advertisers, and Affiliate Managers should review their Affiliate Marketing Agreements to make sure this new law is taken into account in the contract, and then implement appropriate performance standards, creatives, and the like for affiliates.

Fourth: Everyone should get ready to be compliant by October 1, and be prepared to assure and prove compliance with both internal and external facing performance standards.

Fifth: Check and see if there were state laws that mandated certain disclosures and affirmative permission from a consumer that now may be PREEMPTED by this federal law. Yes, there is a preemption provision effectively invalidating state laws that purport to regulate the marketing activities now covered by this Federal law. That could be a good thing for affiliates and merchants and everyone else involved.

Sixth: Keep in mind that there is a work-around for the much talked about 30 day opt-out provision.

Dozier Internet Law offers compliance services in a broad range of online legal areas, with a strong emphasis on affiliate marketing. Whether you use our firm, or someone else, really consider getting some help in this area. One wrong step can have enormous and adverse consequences. And, keep in mind that things are not going to get any easier. There is a lot of proposed legislation and proposed rules that will continue to impact the affiliate marketing community.

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Dozier Internet Law Federal Court Report, by John W. Dozier

September 04, 2008

At Dozier Internet Law we monitor the Federal Courts everyday and once a month prepare summaries of the most important and interesting lawsuits filed. You can imagine the number of lawsuits I personally go through each month. It's enlightening to see what the trends and latest and greatest theories of recovery are in the Federal Court.

You can get the complete lawsuit off of the Pacer system. But, we do not provide copies of the lawsuits to third parties. At Dozier Internet Law we'll give you a heads up, and I spend a lot of time each month authoring the Dozier Internet Law Federal Court Report. One day all of the state courts will be online and we'll be able to add the lawsuits filed around the country in the state court systems to our report.

The Ronald J. Riley lawsuit will be available online shortly.

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Ronald J. Riley and Inventored.org Sued, by John W. Dozier

September 05, 2008

Dozier Internet Law has filed a lawsuit in the Circuit Court of the County of Henrico, Virginia against Ronald J. Riley and a total of eleven of his businesses and fictitious names. In response to recent legal action by this law firm against Riley, he is attempting to convince the blogosphere that this lawsuit is an attack on his free speech rights. Just the opposite is true. Ronald J. Riley's misconduct includes his attacking bloggers and blog and forum moderators with threats of getting IP addresses of anonymous bloggers and then tracking them down. Ronald J. Riley is not at all what he seems to be.

The Dozier Internet Law lawsuit resulted from a year long investigation of Ronald J. Riley and took us from interviews with Harvard Law School to Nobel Prize Winners. The discoveries about Mr. Riley along the way are troubling, and as he attempts to continue his attacks on his critics, a well rounded understanding of who Mr. Riley is and how he operates will be profoundly revealing and educational.

Update: The Dozier Internet Law lawsuit is available online now. You may also be interested in the blogosphere's take on Ronald J. Riley and news coverage of Ronald J. Riley from the hometown of the Nobel Prize Winner referenced in the lawsuit.

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$400,000 Judgment For Using Competitor Name, by John W. Dozier

September 18, 2008

Dozier Internet Law often deals with situations in which a competitor is using another competitor's name, and while this area of law is clearly evolving, the Courts are beginning to understand the nuances associated with the power of this practice for SEO purposes, and reacting appropriately.

An excellent court decision crossed my desk about the August 28, 2008 First Circuit Court of Appeals opinion confirming a judgment for over $400,000 against a small business. The "offense"? Trademark infringement. In particular, the defendant used a competitor's name in its "metatags", and in the content of the site in white lettering with a white background, obviously for SEO purposes. And that is all that was proven. Both the US District Court that awarded the judgment and the First Circuit agreed that both uses infringed on the plaintiff's trademarks.

My guess is that the defendant took the advice of some of the commentators you see online and I suspect, given the other facts of how the case was handled, assumed the Court would conclude there was no trademark infringement. The end result was a judgment for all of the net profits of the Defendant's entire business for the last three and a half years, which was $230,339, plus attorney fees of $188,583, and to add insult to injury, another $7,500 in costs.

Eric Goldman blogs about how "wrong" this decision is. He claims that "metatags don't matter from a technology perspective", citing to his own blog post in which he claims, well..."metatags don't matter". Dozier Internet Law and the Courts, on the other hand, know they do. But this case was also about using a competitor's name in the content, something Goldman missed, I guess.

First, metatag descriptions are used by Google and Yahoo and most search engines. Metatag keywords are used by meta search engines, and other search engines. Anyone with even a passing understanding of search engine optimization would understand that Goldman's off base here and he really does not seem to grasp how SEO and the algorithms of search engines function.

Now, with respect to using competing trademarks in your content, the search engines use those terms to decide when to return a result. So, if someone is searching for Sears, and Walmart repeatedly, and with search engine optimization principles in mind, uses the Sears name on a page of its site, Walmart will come up in the search results when someone is looking for Sears. And thus the problem. If Walmart uses the Sears trademark in the coded title of the page, in an HTML header, repeats it three times, and uses anchored hypertext links with the name to mislead the search engines into believing that a Walmart page is a Sears page, then it becomes more and more apparent what is going on, and the Walmart result will move higher in searches seeking "Sears". There are many other SEO techniques surrounding the Sears name that could be employed, which I won't discuss here. Suffice it to say that the Courts, both the US District Court and Circuit Court, got it right.

By the way, I use Sears and Walmart as an example only. I don't know of any information that suggests either one of these companies is doing this...for what should be obvious reasons to everyone who REALLY understands the law and business of the web.

Obvious, according to the Court decision, even to the Defendant in this case...the Courts found that the defendant "admittedly took these actions because he had heard that Venture's marks would attract people using internet search engines to the McGills website."