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Whatz Gnu? Rimon Teleseminar: Facebook Personalized URLs: Titanic Brand Opportunity or Tip of an Iceberg?

Last week, Facebook announced the availability of a personalized Facebook URLs. This latest offering from Facebook raises serious issues—issues that are typically encountered when technology collides with traditional intellectual property laws intended to protect trademarks and brand names. Much like the confusion and abuse that proliferated when cybersquatting became rampant over the ownership and administration of domain names, we now have social networks and service providers allowing users to generate content and offering customized URLs within their domains in a digital and borderless world. Significantly, the promotional momentum created by Facebook’s offer has caused every astute brand and trademark owner to ponder whether they should be in a rush to register their personalized URL on Facebook, or let it ride and deal with potential infringements when—and if—they occur! You need practical guidance and insightful approaches to these problems.

The Media & Entertainment Industry Team and the Advertising Technology & Media Law Group at Rimon have put together an informative one-hour teleseminar entitled “Facebook Personalized URLs: Titanic Brand Opportunity or Tip of an Iceberg?” airing on Tuesday, June 23 at 12 p.m. EDT with partners Doug Wood and Joe Rosenbaum, to help you understand the issues, formulate an approach and make informed decisions and you are invited to participate. Participation is free, although long-distance telephone charges apply outside of the United States, the UK, France, and Germany, where 800 numbers are used. Don’t miss this call!

Call-in ports are limited, so please click here to register or contact Anna Kazachkov at akazachkov@rimonlaw.com no later than Monday, June 22, to receive a dial-in number and a passcode. If you require additional information, you can contact Anna by telephone directly at +1.212.702.1399.

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Facebook Adds Personalization & a (Brand) New Dimension?

On Tuesday, June 9, the popular social networking website, Facebook, announced that on Saturday, June 13 at 12:01 a.m. U.S. EDT, it will allow its registered users, subject to certain criteria and qualifications, to create personalized URLs for profiles and pages on Facebook (e.g., http://www.Facebook.com/insertyournamehere.   Currently, a user’s Facebook URL consists of the Facebook.com URL followed by numbers (e.g., http://www.facebook.com/profiles.Php?349485).

Allowing users to register personalized names on the web raises, among other things, infringement issues under federal and state trademark and related intellectual property laws, particularly for owners of well-known brands. Any registration process creates fears of cyber squatting and other attempts to hijack trademarks and brand names. Sometimes these fears are well founded; other times they are not. You may have already received bulletins from law firms and bloggers eager to alert you to the fact that Facebook has also announced it has created an online submission form that allows owners of registered trademarks to notify them of their IP rights. Ostensibly, Facebook intends to use the information submitted to preclude others from attempting to use registered marks in personalizing their URLs on Facebook.

While we applaud advising clients and friends of this development, we believe the matter is considerably more complicated than previous briefs and hasty reports may indicate. As is so often the case, the devil is in the detail, and the information below will give you a deeper look at the issues before racing to submit notifications of your IP rights to Facebook.

Continue reading “Facebook Adds Personalization & a (Brand) New Dimension?”

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Employees Off-Work, But Online

This post was written by E. David Krulewicz and Cindy Schmitt Minniti.

Facebook, MySpace and Twitter have become household names, a ubiquitous part of the daily lives of many and often a tool for keeping in touch with friends and family. These websites are increasingly being used by individuals to document their daily lives and activities, voice their concerns and post their opinions for the world to read and to respond. The business community has also turned to these “social media” websites as means for marketing their brands and, in some instances, for obtaining information about current employees and prospective job applicants. A series of recent cases reminds us there are significant risks related to the posting and/or use of information discovered on “social media” websites.

For example, in Pietrylo and Marino v. Hillstone Restaurant Group, a case pending in the Unites States District Court for the District of New Jersey, two individuals sued their former employer after they were terminated for posting complaints about their workplace on an invitation-only discussion forum on MySpace.com. Much to the employees’ surprise, managers from Hillstone Restaurant Group were able to access this discussion board (although the parties dispute whether the managers had a right to do so) and were less than pleased with what they read. The employees were quickly terminated and a lawsuit followed. 

In their complaint, the former employees assert their employer not only violated state and federal Wiretap and Stored Communications Acts by accessing the invitation-only forum, but wrongfully terminated them in violation of New Jersey’s public policy favoring free expression and privacy as embodied in the U.S. and the New Jersey Constitutions. Their employer has denied the claims and asserts the plaintiffs were “at-will” employees who could be terminated for any reason or no reason at all.

Ultimately, the question of liability may hinge upon whether the employees had a right to privacy for statements made online and whether the employer has a right to make disciplinary decisions based on an employee’s off-duty conduct.

Although legal commentators and privacy advocates debate how the trial will unfold when the case goes to trial later this summer, they all agree the case highlights real- world issues that can follow an individual’s seemingly innocent decision to post his or her thoughts on a social networking website. This is far from an isolated incident – indeed, the sports media recently reported a similar incident involving the Philadelphia Eagles’ termination of a long-time employee for disparaging the team’s management and its decision to release a prominent player on his Facebook page.  

While it is unclear if any of the companies in the cases above had a policy or provided instruction to their employees on these issues, it should not surprise you that increasingly business employers are finding they must do so. Clearly, before making decisions or taking action against employees for online, but off-duty conduct, employers should seek legal counsel from lawyers who understand these issues and can guide you in this dynamically evolving environment – where federal and state (and sometimes municipal or local) law may apply and little, if any, precedent currently exists. Worried? Need help? Need to understand more? Contact E. David Krulewicz or Cindy Schmitt Minniti or the Rimon lawyer with whom you work. 

Update:  Today, May 20th, after this story was posted, the U.S. House of Representatives also approved the bill regulating some common credit card and gift card industry practices. It is likely President Obama will sign the bill once it arrives on his desk.

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Better to Lose Face Than Facebook

Facebook, the very informal and ostensibly open social network, hinting at an apology for what its CEO acknowledged were “overly formal and protective” Terms of Service, did an abrupt about-face recently, retracting them and reverting to its old Terms of Service—presumably reacting to a sea of complaints from just about everyone. Complaints? Over legal terms—does anyone still read them? Well, they do, and they didn’t like what they read—particularly the part that claimed unrestricted, perpetual ownership of your personal data, even if you decide to delete your entire account and go away. 

While we respect Facebook’s right to better manage, control, and disclose to consumers how and for what purpose it treats and handles personal data, it highlights a number of things the online world continues to teach us. First, don’t assume those innocuous changes buried somewhere in terms of service, terms of use, privacy policies, codes of conduct, rules of the road, or whatever you choose to call them, aren’t being scrutinized—by consumers, by your customers, by the media and, lest we forget, by regulators and legislators. While Facebook has not admitted it was caught a bit red-faced, it is taking your feedback in a “Facebook Bill of Rights and Responsibilities” group to which you can contribute your thoughts. For those in the know, Facebook’s population has grown to more than 175 million users—does that make it the sixth-largest country in the world? Hmm, I wonder if that country has a growing budget deficit too; we’ll have to wait for the State of the Reunion speech, when results are posted, to find out.

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Dazed & Confused, Not Shock and Awe

For 2009, here are my predictions:

The economy and strife, regulation and surveillance will dominate the agenda, with the burden of paying for everything from wars to bailouts right in the crosshairs: watch those advertising budgets boys and girls, the taxman cometh.

Privacy and advertising, long separated by passive print, television and radio, will continue to collide—Congress will either pass ineffective and inappropriate legislation because it’s too busy to pay attention, or will defer legislation another year because it’s too busy to pay attention.

Wireless and mobile technology will continue to make us say “wow” and will continue to miniaturize our lives, putting not just communication, but also our wallets, calendars, purchasing, entertainment and working tool kits in our hands, not our laps.

The use of wireless and additional licenses, spectrum and bandwidth will bring the FCC and the FTC colliding in their zeal to regulate, and they will either cooperate because they are too busy to fight or fight because they are too busy to cooperate. In either case, regulation, re-regulation and self-regulation will continue to increase, unregulated.

Marketing, promotions, new media, digital content and distribution platforms will transform gaming and interactive play into entertainment, education and information—giving us more choices, but continuing to blur the lines between advertising, entertainment and information.

Continue reading “Dazed & Confused, Not Shock and Awe”

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Red Faced or Saving Face. Facebook Faces the Music!

Facebook has built a highly popular business, but it turns out making that popularity profitable appears to depend, in large measure, on advertising. Sound familiar? So Facebook announced a new program, Beacon, an online tracking tool. No, online tracking certainly isn’t new: companies track where your browser has been and your online activity, and routinely serve up ads based on “preferences”—where you have been, what you look for, and what you purchase. But that takes place behind the scenes—you just see the results: relevant, targeted advertising.

Facebook has taken online tracking one step farther: Beacon sends messages telling your Facebook buddies what you are buying and, in some cases, what you are doing. So don’t plan that surprise trip to Puerto Rico just yet—buying a ticket might ruin the surprise. In fact, don’t come back from the trip and rate the hotel—your friends who weren’t invited will know you’ve been there.

Facebook faced criticism last year when its “News Feed” function came under fire. Media and industry pundits and Facebook executives note often schizophrenic and hypocritical marketplace attitudes. Indeed, there is some irony to be considered when the generation that posts profiles, adding everything from drinking, sexual preferences, and religious affiliations, to family videos, in blatantly public web-spaces, complains about privacy. But consumers still distinguish between their choice to share, and allowing a host to decide what, when, where and how to share information about them, or whether to characterize activities as some form of an “endorsement without consent” to their friends.

As usual, privacy and consumer advocacy groups were poised to file complaints with the FTC, right on the heels of investigations already launched by several Attorneys General into Facebook’s privacy practices. The New York Attorney General has issued a subpoena to Facebook for copies of complaints about “inappropriate solicitation of underage users and inappropriate content on the site.” As innovators have learned, success shines a spotlight that creates a glow—and discloses warts; let’s see if they can keep Facebook blemish-free.

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Content is King, but the Medium Is Still the Message

Recently lawyers have begun to debate the question of just how much control advertisers can exert when paying for product placements or branded entertainment before the line between First Amendment expression by the creative staff putting together the program and the financial subsidies from advertisers is crossed. Now, the Ninth Circuit has dealt with a similar question relating to the immunity that interactive computer service providers have typically enjoyed under the Communications Decency Act (the “CDA”). The CDA insulates service providers from liability so long as the service provider remains a publisher of information and content of others (there are exceptions, so the immunity is not blanket and you should always consult legal advice for specifics that apply to your situation). That said, a company that operates an online web service that specializes in matching roommates based on their preferences has been held in violation of the Fair Housing Act because a questionnaire put together by the company asks for certain demographic information that, when posted on the website, could be used by users and site visitors to discriminate against others. The company, Roommates.com, asked users to disclose information, among other things, about roommate preferences such as age, sex, children, etc. The Ninth Circuit held that although Roommates.com was immune as long as it was simply enabling the distribution or display of information provided by its members, when it became an information content provider, it lost immunity with respect to that activity and information. And by putting together the questionnaires and soliciting their preferences in response, Roommates.com was not simply posting content authored by users, but rather was eliciting specific information that could be abused and that might or might not have been voluntarily posted or disclosed absent the questionnaires.

Hmmmm…user profiles, play lists, segmented marketing, asking consumers to participate in promotions…this is an interesting test of the limitations of the CDA to protect and insulate interactive online service providers from liability. As social networks, virtual worlds and other digital arenas that don’t simply enable but also solicit or encourage certain information to be provided, and as web services become more targeted, focused and segmented to match consumer preferences, the immunity is likely to be tested further. Stay tuned.

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User-Generated Content

User-generated content (“UGC”) on the Web is serious business and becoming more so by the day. While many know UGC as a challenge to IP rights, eMarketer is predicting advertising spending on social networking, photo sharing, gaming and amateur video websites to reach $4.3 billion by 2011—compared with the $450 million in advertising revenue they reported in 2006. That means companies are going to have to figure out how to differentiate themselves and maintain positioning in the face of increased competition. The ease of creation, coupled with technology—whether embedded players, gadgets and widgets, or more sophisticated interactive game sites—means that millions of users can create, post and “snag” user-generated content, and the trend shows no sign of diminishing. Social networking companies are significant sources of advertising revenue and are growing targets for investors seeking to build market share or obtain a piece of the transactional pie. Increasingly, mobile marketing and messaging companies are building the wireless and global brands, and are increasingly monetizing their social networking and messaging capabilities.

Legislators and regulators are noticing the exuberant success and popularity these services enjoy and, with a demographic skewed to a younger portion of the population, there is no question these services, the advertising they carry, and the content available on their sites, will continue to draw scrutiny in the months and years ahead. Rimon represents social networking companies, advertising agencies, and advertisers and media companies around the world. When you think of legal issues surrounding user-generated content—standards, copyright protection, digital rights management, filtering, viral or buzz marketing and so much more—please think of our Advertising Technology & Media Law practice group.

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Parallel Universe Spawns Parallel Legal Woes

You knew it had to happen, but are still surprised when it does. In what may be a first-ever, a lawsuit has been filed against a defendant that doesn’t really exist, over a non-existent furniture line. Yes, you guessed it, a bed with special embedded animations that allow participants in Second Life, the virtual reality world established by Linden Labs, to essentially recreate an adult film with their virtual persona—avatars.

For the past few years, Second Life’s approach to IP protection has been to allow players to keep rights to programs, animations and objects they create—although many of the tools (programming scripts, etc.) are Linden’s and are provided to enable players to build things in this virtual world. Much like user-generated content in the world of multimedia audio-visual works, creativity and innovation is creating virtual content by the boatload and creating virtual objects and businesses is not simply a recreational pastime, but also a source of entrepreneurial glee and money for many. Clothing, real estate, automobiles, virtually (pardon the pun) anything, becomes the object of virtual purchases, sales and licensing.

Well, the law has caught up with reality. One player, whose avatar is selling virtual items under the brand “SexGen” bed, is suing another avatar for selling fakes for less—undermining the business. Since you have no obligation to disclose your true identity in Second Life, who do you sue? Well, first you try to get information from Linden, presumably because their computers house the underlying registration and information that would disclose who is behind the knock-offs. But, if the alleged infringer has not registered a real name, credit card or other “real world” items to enable identification, you might only get an IP address.

So we’ll keep you posted on developments, but who knows where this will go. Will a court entertain the case? Will they discover the identity of the alleged infringer? Will copyright infringement principles apply in a virtual world? Perhaps the plaintiff will try to enjoin Linden from allowing or enabling the fake products, or send them a virtual Digital Millennium Copyright Act (“DMCA”) “take-down” notice.

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Don’t Like Pop-Ups or Banners? Try a Widget

Studies now show that marketing professionals looking to attract today’s generation of social networking, mobile messaging, interactive gaming young people might well experiment with more digital features that one can play and interact with on the Internet. If you responded to last month’s Legal Bytes “Useless But Compelling Facts” (or you peeked at the answer below), you know that a widget refers to a computer program that allows Web pages to be sophisticated and interactive—using graphics, animation, audio-visual effects and user-generated content. While advertisers lose control over where these little widgets are placed (e.g., next to a competitor’s widget), giving consumers—especially young people (another issue for marketing to children?)—a premium or incentive is more likely to get them to put advertising content on their pages. It appears, at least according to one study, that when kids are given a choice of what they want to appear on their pages, especially when some “goodie” is part of the offering (a game, free download, coupon, etc.), they are more likely to choose to use advertisers’ content, than if it is “pushed” to them.

Although using widgets as a promotional tool doesn’t guarantee a successful advertising campaign, especially if the product or service isn’t up to par, widgets represent another arrow in the quiver of advertising and marketing professionals to personalize and target audiences. Some social networking sites block users from putting up widgets, or selectively enable widgets based on endorsements or the protection of intellectual property rights. Widgets also represent another challenge to traditional advertising economics. Since users choose when and where to post the widget applications, the widget creator—generally a hosting, server or similar technology or digital graphics firm—is the only entity getting paid, and beyond that, advertising (and thus advertising revenue) is not tracked.