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March 2012 Archives

March 1, 2012

Amazon.com Seeking Associate General Counsel

Amazon.com is looking for an Associate General Counsel (AGC) of Music Licensing to significantly contribute to the further expansion of our products, services and geographical reach. Working closely with the business leaders of the Digital Music team and Amazon's legal team, the AGC will be responsible for structuring, drafting, negotiating and closing strategic licensing transactions and providing support, as required, on related commercial, intellectual property and regulatory issues.

With the recent release of our Cloud Player and Kindle Fire products, Amazon is uniquely positioned to introduce unprecedented functionality and virtual music experiences. The AGC, Music Licensing will assist in forming and executing our strategy to deliver more robust digital music offerings to our consumer base. This leader is expected to be a creative visionary in a rapidly evolving industry.

A J.D. from a top school, experience in licensing digital content or software IP and membership in good standing in at least one state bar are required. This role is based in Seattle , WA . Please send your resume to Karen Bertiger at bertiger@amazon.com

March 4, 2012

Weekly Issues in the News

By Geisa Balla

White v. West Publishing
Edward L. White, an Oklahoma attorney, and Kenneth Elan, a New York attorney, filed a class action copyright infringement lawsuit against West Publishing Corp. and Lexis Nexis in the United States District Court, Southern District of New York on February 22, 2012. The complaint alleges that the Plaintiffs and all class members own the copyrights to their legal work product, such as pleadings and memoranda of law. It further asserts that the Defendants infringe on the Plaintiffs' copyrights by willfully copying and distributing such works in their databases. The Class is defined as "all attorneys and law firms . . . through which attorneys are authorized to practice law in the United States, and its states and territories that authored works (including but not limited to, legal briefs, motions memoranda and other legal documents) that are contained in Defendants' searchable databases."


Google's Privacy Policy and the European Union
Google's new privacy policy potentially violates European Union law. The European Commission asked the French privacy agency, the National Commission for Computing and Civic Liberties (CNIL), to conduct an initial assessment of Google's privacy changes. After its investigation, CNIL wrote a letter to Larry Page, Google's co-founder, expressing its concerns that Google's privacy policy was unclear: "Our preliminary investigation shows that it is extremely difficult to know exactly which data is combined between which services for which purposes, even for trained privacy professionals." CNIL has stated that it would send Google a full questionnaire about its privacy policies by mid-March. CNIL has the power to fine companies up to $400,000 for privacy breaches in France.


Shepard Fairey
Shepard Fairey, the Los Angeles street artist who became widely known in the 2008 U.S. presidential election for the Barack Obama "Hope" poster, pleaded guilty in New York to one count of criminal contempt for destroying documents, manufacturing evidence and other misconduct in his case involving his "Hope" poster. The charges stem from his civil lawsuit with the Associated Press. The Associated Press had claimed that Fairey used a copyrighted photo to create his "Hope" poster, while Fairey claimed that his work was protected under the fair-use doctrine. Fairey admitted in 2009 that he destroyed documents and submitted false images during the lawsuit, which was settled in 2011. A sentencing date has been set for July 16, 2012. Fairey could face a maximum fine of $5,000, a maximum prison sentence of six months, and a maximum term of supervised release of one year.


Harper Collins v. Open Road
On February 16, 2012, Open Road Integrated Media (Open Road) answered the complaint filed by HarperCollins Publishers (HarperCollins) in the United States District Court, Southern District of New York. HarperCollins filed a copyright infringement lawsuit against Open Road on December 23, 2011, regarding Open Road's publication of an e-book edition of the book Julie of the Wolves, by author Jean Craighead George. The lawsuit alleged that HarperCollins had a contract with the author, signed in 1971, giving it the right to publish the book "in book form," including via "computer, computer-stored, mechanical or other electronic means now known or hereafter invented." Open Road released the following statement: "We are confident that we have secured all necessary eBook rights from the author Jean Craighead George and that we will prevail. HarperCollins' claim is nothing but an attempt to seize rights that were never granted to it and to change the existing law with respect to eBook rights." Author Jean Craighead George added: "I have asked to intervene in this action to protect my rights under copyright and under my original contract with HarperCollins. When I signed that contract in 1971, eBooks did not exist so I could not have granted those rights. I am with Open Road all the way."


Hathi Trust
The Authors Guild filed a Motion for Partial Judgment on the Pleadings on February 28, 2012, in its lawsuit against HathiTrust. HathiTrust is a digitization initiative of over 60 partners and university libraries, including content digitized via the Google Books project. The Authors Guild filed a copyright infringement lawsuit against HathiTrust in the United States District Court, Southern District of New York, in November 2011, claiming that HathiTrust's scanning program constituted copyright infringement. HathiTrust answered the complaint in December 2011. The Author's Guild Motion for Partial Judgment argues that HathiTrust admitted to most of the allegations, and the Court should hold that HathiTrust's digitization projects are "not protected by any defense recognized by copyright law."


Urban Outfitters and the Navajo Nation
The Navajo Nation filed a complaint against Urban Outfitters Inc., on February 28, 2012, in the United States District Court for the District of New Mexico, alleging trademark infringement and violations of the federal Indian Arts and Crafts Act. The dispute began in 2011, when Urban Outfitters began selling a line of Navajo-branded products, particularly underwear and liquor flasks. The Navajo Nation sent a cease-and-desist letter to Urban Outfitters, demanding it pull the name "Navajo" from these products. The Navajo Nation claimed that the use of "Navajo" was "derogatory and scandalous," and Urban Outfitters removed the product names from its website. The lawsuit claims that Urban Outfitters is still selling "Navajo" branded items through its other company brands, in catalogs, and in retail stores. The Navajo Nation, which has 10 registered trademarks of the Navajo name, alleges in its lawsuit that the "fame and reputation of the Navajo name and marks is such that, when defendant uses the 'Navajo' or 'Navaho" marks with its goods and services, a connection with the Navajo Nation is falsely presumed."


Interpol has arrested 25 suspected members of the hacker group Anonymous in Europe and South America with the help of local law enforcement agencies. Those arrested are suspected of planning coordinate cyber-attacks against institutions such as Columbia's defense ministry and presidential websites, Chile's Endesa electricity company and national library. Among those arrested were four individuals who are suspected to have attacked Spanish political party web sites. These four are suspected of publishing information about police assigned to the royal palace. As authorities have made arrests of Anonymous members, Anonymous has made increasing attacks on law enforcement and military targets.


Madonna allegedly changed the title of her new single her upcoming album MDNA from "Girls Gone Wild" to "Girl Gone Wild" to avoid legal action from "Girls Gone Wild" founder Joe Francis. Mr. Francis claims that he threatened legal action against Interscope Records if the single was released with the original title. In a statement, he claims that the change from "Girls Gone Wild" to "Girl Gone Wild" was "an immediate solution form to thwart any injunctive relief." "Clearly her label was trying to avoid legal action surrounding the song," "[b]ut this is still infringement as far as the law is concerned and we have been in touch with Madonna's representatives in an effort to resolve this issue." Madonna's manager Guy Oseary claims that Francis had no impact on the name change as the song titles have been in constant flux for weeks, and that Madonna does not even know that Joe Francis exists.


On March 1, 2012, multiple television networks filed two separate lawsuits against start-up company Aero for wanting to broadcast without having "licensed this television programming from those who own it." Aereo is a small company that plans to launch its services on March 14, 2012, providing live streaming of major networks to mobile devices for a monthly fee. The first lawsuit, filed in the Southern District of New York by networks including Fox, Univision and PBS, claims that Aereo's planned re-transmittal is unlicensed and without consent. The complaint lists three causes of action: copyright infringement of the public performance right under 17 U.S.C. §§ 106(4), 501, copyright infringement of the reproduction right under 17 U.S.C. §§ 106(1) 501, and unfair competition under New York common law.


March 5, 2012

From Prospect to Pro: A Legal Primer on Recruitment of Professional Athletes Including Foreign Players

Thursday, March 8, 2012 from 6:00pm - 8:00pm

- Location -
Benjamin N. Cardozo School of Law
Room 424
55 5th Avenue
New York, NY 10003

The Entertainment, Arts and Sports Law Section and the Metropolitan Black Bar Association, Benjamin N. Cardozo School of Law Black Law Student Association and the Minority Law Student Association will cover key issues affecting the recruitment or professional players, including the regulation of agents, NCAA rules, the NBA categorization of prospects, dealing with foreign agents and players, including immigration aspects.

The speakers include Jared Bartie, Esq., Arent Fox, who has counseled sports clients on a variety of matters; Colleen Caden, Esq., Pryor Cashman, LLP, who represents many professional players and professional teams on immigration issues; Professor Mark Conrad, Associate Professor of Law and Ethics at Fordham University's Gabelli School of Business and its Graduate School of Business Administration; Brooks Meek, NBA, VP - Basketball Operations, International;; and Sunny Shah, CEO of 320 Sports Inc. and NFLPA Certified Contract Advisor.

EASL & MBBA Members: $25 (MBBA Members please call 518-487-5674 to register)
Non-Members: $50
Law Students: $15
Cardozo Law Students: Free with ID (Please call 518-487-5674 to register)
For more information, contact: bgould@nysba.org

Google Books Case Developments: Google Responds to ASMP and Authors Guild

By Mary Rasenberger

In the Google Books case, Google filed its responses on February 17, 2012 to the American Society of Media Photographers' (ASMP) and the Authors Guild's oppositions to Google's motions to dismiss ASMP and the Authors Guild for lack of standing. (See What Your Trade Association Can Do For You, http://nysbar.com/blogs/EASL/2012/02/what_your_trade_association_ca.html). Google took issue with the Plaintiffs' assertions, in their oppositions, that the third prong of the Hunt test for association standing is merely a prudential consideration that the Southern District need not apply rigidly. See Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 343 (1977). The Supreme Court in Hunt set out a three-part test for determining whether an association has standing to bring a claim on behalf of its members; the third prong at issue in Google's motions is a requirement that neither the claim asserted nor the relief requested requires the participation of the individual members in the lawsuit.

Google's Response

Google first argues that the requirements in Hunt are an important limitation on federal jurisdiction; whereas ASMP and the Authors Guild had argued that the third prong is instead a discretional consideration concerned with administrative convenience.
While Google concedes that the Supreme Court in United Food & Workers Union Local 751 v. Brown Group, Inc., 517 U.S. 544, 556-57 (1996), held that this third Hunt prong was not a "constitutional necessity," it argues that the Court still considers the prong to be an important limit on federal jurisdiction, rather than an optional inquiry for a court to simply disregard: "To see Hunt's third prong as resting on less than constitutional necessity is not, of course, to rob it of its value." 517 U.S. at 556. Thus, Google argues that, although the prong may be a prudential rule of self-governance susceptible to Congressional abrogation, the prong is nonetheless a rule that courts are not entitled to overlook.

The third prong of the Hunt test for associational standing requires that neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. Under Google's strict reading of this prong, it argues that the associations' copyright claims, and Google's fair use defense, require the participation of each individual ASMP and Authors Guild member because the injuries suffered by each association member is particular to the individual, requiring individualized proof in analyzing the copyright claims and fair use defenses.

First, Google argues that the copyright claims need to be analyzed on a case-by-case basis, particularly the issue of copyright ownership, as there are factual issues surrounding copyright ownership of the works, including whether they were "works for hire." Additionally, Google maintains that individual inquiries are relevant in analyzing its fair use defense. Three of the four fair use factors set out in Section 107 of the Copyright Act require in an inquiry that will vary from book to book. These three factors are: (i) the nature of the copyrighted work; (ii) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (iii) the effect of the use upon the potential market for or value of the original work. (17 U.S.C. §107 (2)-(4).) Google argues that because the facts differ from book to book, these inquiries require analysis of individualized evidence. In other words, it states that its fair use defense cannot be assessed in a collective manner.

Google distinguishes the cases that the associations rely on in support of the proposition that association standing is permissible in copyright cases similar to the Google Books case, including Itar-Tass Russian News Agency v. Russian Kurier, No. 95 Civ. 2144 (JGK), 1997 WL 109481 (S.D.N.Y. Mar. 10, 1997), rev'd in part, 153 F.3d 82 (2d Cir. 1998). ASMP had argued that Itar-Tass in particular is "most pertinent to this Court's analysis." In Itar-Tass, the district court held that an association of Russian journalists had associational standing to bring copyright infringement claims on behalf of its members. Google distinguishes Itar-Tass on the grounds that the factual issues regarding ownership in that case did not vary among the works at issue, and the case did not involve fair use.

The Second Circuit's Decision may have Important Implications for Associational Standing

As discussed above, courts have in some cases found associational standing to be appropriate in the context of copyright litigation. Questions remain, however, regarding how broad a trade association's right is to adjudicate copyright claims involving issues of ownership and fair use on behalf of its members. Judge Chin's decision on these motions thus likely will set important precedent in determining what the limits are on a trade association's associational standing in fair use cases.

Putting the Motions in the Context of the Litigation on the Merits

The positions taken by Google in its motions and responses are also interesting for what they say about Google's strategy in the case on the merits. Will it continue to assert on the merits, as it claims here, that individualized inquiry need be made with respect to ownership of each work and fair use need be analyzed on a work by work basis? Will it request discovery on a case-by-case basis in an attempt to drag the case on indefinitely? There are millions of works at issue in the case. The idea of the court's analyzing each work on a case by case basis is, of course, absurd - all the more absurd given that Google claimed fair use for its scanning and fragment use on an across-the-board basis, with no consideration of individual factors.

Scheduling Dispute Regarding ASMP's Request to Brief Fair Use before Class Certification

ASMP and Google filed letters with the court on February 17th and 22nd, respectively, regarding an expedited discovery and briefing schedule on the issue of fair use. ASMP proposed that any motions for summary judgment as to infringement or fair use be filed on an expedited schedule, before a decision on class certification. Google states that this proposal "is both unworkable and unjust," and that resolving the merits before considering the question of class certification is appropriate only "where the merits of the plaintiffs' claims can be readily resolved on summary judgment, where the defendant seeks an early disposition of those claims, and where the plaintiffs are not prejudiced thereby."

March 7, 2012

Madoff Trustee Wins Partial Summary Judgment in Suit Against Mets Owners; Jury to Hear Remaining Claims

By Pamela R. Shisler

Mets fans have dealt with a slew of bad news recently. On the field, promising young first baseman Ike Davis was diagnosed with a likely case of Valley Fever, and beloved third baseman David Wright was placed out indefinitely with a rib-cage injury. On Monday, off the field, S.D.N.Y. Judge Jed Rakoff dealt the beleaguered fan base another blow in the form of a four-page order in the high-profile suit by Madoff bankruptcy trustee Irving Picard against New York Mets owners Fred Wilpon and Saul Katz (Picard v. Katz, No. 11 Civ. 3605).

Judge Rakoff characterized the brief order as a set of "bottom line" rulings on the parties' summary judgment motions, indicating that a full opinion is still to come. In the order, which followed full discovery, the court granted the trustee's motion for partial summary judgment, holding that the trustee was summarily entitled to recover up to $83 million from the defendants. The $83 million represents the net profits beyond their principal investment that the defendants had received from the Madoff fund during the applicable two-year look-back period. In an earlier opinion dated September 27, 2011, the court ruled that federal bankruptcy law entitled the trustee to "avoid" or claw back any of the net profits paid out by the fund within two years prior to the bankruptcy filing, unless the defendants could show that the profits were received "for value". In Monday's order, Judge Rakoff held that the "value" the defendants gave to the Madoff fund was limited to the amount of their principal investment. Thus, the trustee was entitled to recover up to the $83 million in profits that were paid to the defendants. The exact amount recoverable by the trustee and the apportionment of that amount among the various defendants will be determined in a subsequent order.

The court also denied the defendants' motion to dismiss the trustee's remaining claims to recover the amount of principal investment that was returned to the defendants during the two-year look-back period, approximately $303 million. In his earlier opinion, Judge Rakoff had ruled that the trustee could only succeed on these claims by showing that the defendants had invested the principal with Madoff in bad faith. Rejecting the more lenient "inquiry notice" standard advanced by the trustee, the court had ruled that the trustee could only rebut the defendants' presumption of good faith by showing that the defendants had been "willfully blind" to the Madoff fraud. In Monday's order, Judge Rakoff held that the trustee had presented enough evidence to allow the issue of the defendants' good faith to proceed as a question of fact for the jury at trial. However, in the brusque language that has come to characterize Judge Rakoff's opinions in this case, he stated in no uncertain terms that he remained skeptical of the trustee's ability to ultimately succeed on the issue. Mets fans might see a silver lining in Judge Rakoff's stated concern that much of the trustee's evidence of bad faith presented during summary judgment proceedings may not be admissible at trial under the Federal Rules of Evidence. "Nevertheless," he wrote, "there remains a residue of disputed factual assertions from which a jury could infer either good or bad faith depending on which assertions are credited."

As the case proceeds to trial, the principal issue to be resolved will be the question of the defendants' good faith in making their investments with the Madoff fund, which will determine whether the trustee can claw back the $303 million principal investment, in addition to the $83 million in profits. Judge Rakoff's order stressed, as he has in past rulings, that the trial date in the case remains firmly fixed for March 19th, so any delay in the start of the trial seems unlikely. Coincidentally, March 19th is also one of the few off days in the Mets' spring training schedule, so expect all Mets-interested eyes to be on the courtroom that day, instead of on the field.

March 9, 2012

Weekly Issues in the News

By Geisa Balla


The Justice Department has warned six of the biggest U.S. publishers that it plans to file an antitrust lawsuit against them for colluding to raise the price of electronic books. The publishers facing this potential suit are Apple Inc., Simon & Schuster Inc., Hachette Book Group, Penguin Group, Macmillan and Harper Collins Publishers Inc. The parties have reportedly held settlement talks to avoid litigation. The potential lawsuit stems from Apple's move to change how publishers charge for e-books. Traditionally, under the "wholesale model," publishers sold books to retailers for half of the recommended cover price, and retailers could then price the books for less than the cover price if they wished to do so. When Apple launched its first iPad in 2010, Steve Jobs suggested moving to an "agency model," under which the publishers would set the price of the book and Apple would take a 30% cut. "We told the publishers, 'We'll go to the agency model, where you set the price, and we get our 30%, and yes, the customer pays a little more, but that's what you want anyway,'" Mr. Jobs was quoted as saying by his biographer, Walter Isaacson. The Justice Department now believes that Apple acted in concert with other publishers to raise book prices across the industry, in violation of federal antitrust laws.


Alexander Wang Lawsuit

A $50 million lawsuit was filed on March 6, 2012, against designer Alexander Wang in Queens Supreme Court, alleging wage and hour violations. The lawsuit was filed by Wenyu Lu, a 56 year-old former employee of Wang, who accuses Wang of running a sweatshop in Chinatown. The lawsuit alleges that workers were forced to work 16 hours a day or longer, without overtime. Lu claims to have been hospitalized because he was forced to work 25 hours without a break, under the threat of being fired. Wang has yet to be served with the lawsuit, but a spokesperson released the following statement to Women's Wear Daily: "The company takes its obligations to comply with the law very seriously, including the relevant wage and hour regulations, the payment of overtime to eligible employees and having a safe working environment for all of our employees. We will vehemently defend any allegations to the contrary."

Louis Vuitton

Louis Vuitton threatened the University of Pennsylvania Law School with trademark infringement lawsuit after a student group parodied the LV monogram on a poster for a fashion law symposium. Luis Vuitton sent a cease and desist letter to the school, stating "This egregious action is not only a serious willful infringement and knowingly dilutes the LV Trademarks, but also may mislead others into thinking this type of unlawful activity is somehow 'legal' or constitutes 'fair use' because the Penn Intellectual Property Group is sponsoring a seminar on fashion law and 'must be experts'. . . I would have thought the Penn Intellectual Property Group, and its faculty advisors, would understand the basics of intellectual property law." In a reply the school's general counsel denied that the poster infringes on LV's trademarks, describing the laws that establish the public right to parody, especially for educational purposes. He also invited LV's attorney to attend the symposium to learn more about intellectual property.

Elite Model Management

The 2008 winner of the TV show "Holland's Next Top Model" won her lawsuit against Elite Model Management in the Amsterdam District court on March 7, 2012. As a winner of the TV show competition, Ananda Marchildon won a three-year contract with Elite, worth about $98,500. Yet she was dismissed from Elite after $13,000 worth of work because she did not lose enough weight. Specifically, Elite asked Marchildon to lose nine centimeters off her hip measurements, from 98 to centimeters to 90. An e-mail from an Elite representative to Marchildon read: "We agreed that you would come by us every two weeks for an evaluation, how it's going with your diet and exercise and losing weight. We're going to keep measuring you." The court awarded Marhcildon $85,000 in damages, plus interest and legal fees.


Apple and Android Applications Access Private Data

By Leila A. Amineddoleh

Earlier this year, bloggers published findings that some of Apple's most popular applications could access private address book data without user consent. An Apple spokesman stated that "Apps that collect or transmit a user's contact data without their prior permission are in violation of our guidelines. We're working to make this even better for our customers, and as we have done with location services, any app wishing to access contact data will require explicit user approval in a future software release." (Perlroth, Nicole and Nick Bilton, "Mobile Apps Take Data Without Permission," Feb. 15, 2012, available at http://bits.blogs.nytimes.com/2012/02/15/google-and-mobile-apps-take-data-books-without-permission/) This statement elicited concern from two House Representatives, Democrats Henry Waxman and G.K. Butterfield. The legislators asked Apple to clarify its developer guidelines and security measures to protect users' information.

On February 16th, in response to the attention from the public and U.S. legislators, Apple stated that it will begin to require iPhone and iPad apps to obtain "explicit approval" in user prompts before accessing users' address book data. (Shih, Gerry, "Apple tweaks apps policy under lawmaker pressure," Feb. 15, 20120, available at http://www.reuters.com/article/2012/02/15/us-apple-privacy-idUSTRE81E1W520120215)

However, a test run by the New York Times questions the veracity of that assertion. To test security measures taken by Apple, the New York Times enlisted a developer to create a test app that requires permission to use a device's location and thus gain access to the phone's photos. The decoy app, PhotoSpy, asked for access to location data when it was opened. Once that information was provided, the app took photos and data location and sent it to a remote server. In essence, a third-party app could copy a user's private content, without gaining additional consent and without providing the user with further notification. A similar test was done with an Android developer, and the Android test app also gained access to users' photos.

In the case of Apple, if customers allow the application to access location data used for GPS-based applications, they also allow access to the users' photo and video files that can be uploaded to outside servers. For Android-based applications, the user only needs to allow the application to use Internet services as part of the app for third parties to gain access to photo albums.

David Jacobs, a fellow at the Electronic Privacy Information Center, criticized Apple for not protecting its customers' privacy. "Apple has a tremendous responsibility as the gatekeeper to the App Store and the apps people put on their phone to police the apps," he said. "It is pretty obvious that they aren't doing a good enough job of that." (Wolfe, Bryan M., "Another iOS Privacy Issue unfolding, This Time Concerning Your Photos," Feb. 28, 2012, available at http://appadvice.com/appnn/2012/02/another-ios-privacy-issue-unfolding-this-time-concerning-your-photos)

The Internet has been abuzz with these findings since the New York Times experiment was disclosed last week. On Sunday, U.S. Senator Chuck Schumer's office released a statement that called on the Federal Trade Commission (FTC) to launch an investigation into reports that Apple applications and Android platforms access users' personal photos and address books. Schumer stated: "When someone takes a private photo, on a private cell phone, it should remain just that: private." (Carew, Sinead, "Senator Schumer asks FTC to prove Apple, Android," March 4, 2012, available at http://www.newsdaily.com/stories/tre8230wz-us-apple-google-ftc/)

The Senator argued that the distribution of information to third parties reaches beyond a "reasonable" user's understanding of the scope of dissemination of information. Schumer opined that "smartphone makers should be required to put in place safety measures to ensure third party applications are not able to violate a user's personal privacy by stealing photographs or data that the user did not consciously decide to make public." (Id.)

The White House has also taken steps to protect privacy. Examination of the Obama Administration's Consumer Privacy Bill of Rights indicates the Administration's interest in protecting user privacy, by limiting not only the use of private information, but also the collection of it. The bill provides users with the right to "exercise control over what personal data companies collect from them and how they use it." (http://epic.org/privacy/consumer/Commercial_Privacy_Bill_of_Rights_Text.pdf)

The bill gives users the right to have their personal data held securely, control data collected and the way that it is shared, and avoid the dissemination of data used for another purpose. In addition, it calls for accountability and transparency by providing users with information as to the identity of companies misusing their personal data.

The Code will be enforced by the FTC, but Congress will also be developing legislation providing the FTC and State Attorneys General authority to enforce the Act. Privacy experts have asked whether federal regulation will hinder technological and communicative developments. However, the better question is whether legislation can keep up with the fast pace of technology innovation. Is it possible for the government to effectively regulate new means of communications that are being developed at breakneck speeds? Do enforcement authorities actually have the ability to police the vast exchange of information over the virtual marketplace? The Act leaves many questions unanswered; in particular, it does not provide a clear mechanism for policing service providers.

Access to the text of the Consumer Privacy Bill of Rights is available at: http://epic.org/privacy/consumer/Commercial_Privacy_Bill_of_Rights_Text.pdf

March 23, 2012

Weekly Issues In the News

By Geisa Balla

American Apparel

New York Supreme Court Justice Bernadette Bayne dismissed the Irene Morales lawsuit against Dov Charney, CEO of American Apparel, on March 22, 2012. Morales, a former American Apparel employee, filed the lawsuit against Charney in March 2011, alleging that Charney began sexually harassing her when she was 17 years old. Her lawsuit alleged that on her 18th birthday, Charney invited her to his apartment, held her prisoner and sexually abused her for hours. Morales eventually quit her job and suffered psychological trauma. Her lawsuit sought damages of $260 million. Charney's defense in this lawsuit was that when Morales left the company, she signed an agreement stating that she had no claims against the company, and that any future claims would be arbitrated. The court agreed with the defense, dismissing the case after a California court had ordered the same case into arbitration. Morales' attorney said that he would appeal the decision. "The California case and the New York case are separate," he said. "The California case involves a blog impersonation and the New York case involves sexual harassment."


A class action complaint was filed against Google Inc. in the Southern District of New York on March 20, 2012, alleging that Google's new privacy policy is deceptive and violates the privacy of consumers. At issue is Google's new privacy policy, whereby Google collects consumer information through each of its services, but does not allow consumers to keep such information separate. The causes of action alleged are violations of the Federal Wiretap Act, Violations of the Stored Electronic Communications Act, Violations of the Computer Fraud Abuse Act, Common Law Intrusion Upon Seclusion, Common Law Trespass to Chattels, Unjust Enrichment, Common Law Commercial Misappropriation, and Violation of Section 349 of New York General Business Law.
The class is defined as "All persons and entities in the United States that maintained a Google account from August 19, 2004 to February 29, 2012, and continued to maintain that Google account on or after March 1, 2012, when Google's current privacy policy became effective."


Former users of the file-sharing site Megaupload have received fake settlement letters asking for monetary settlement. Megaupload was shut down by the Department of Justice and Federal Bureau of Investigations in January 2012. Now, former users are receiving settlement offers from a fake German firm "Dr. Kroner & Kollegen of Munich," claiming to act on behalf of Universal, Sony, EMI Paramount, Warner Brothers and Dreamworks. The letters do not list the actual downloaded files, and do not contain the typical "cease and desist" language. The letters inform the infringers that they are now liable for fines of 10,000 Euros, but they can settle the claim for 147 Euros. The infringers are instructed to wire the money to an address in Slovakia, not Germany.

Alexander Wang

The sweatshop allegation lawsuit against Alexander Wang has been temporarily discontinued. Earlier this year, a lawsuit was filed against Wang by a former employee of Wang, claiming that employees were forced to work in sweatshop conditions in Chinatown. The plaintiff's attorney, Ming Hai, filed a motion to discontinue the case without prejudice, claiming that he has relinquished the case to another attorney who will re-file the case in federal court. Wang's attorney, Hugh Mo, says the case is so flawed that it should be dismissed with prejudice. The change in attorneys might have something to do with an unrelated dispute between attorneys Hai and Mo. Hai issued a $5,000 fine and a court-ordered apology letter to Mo for misconduct in an entirely different case. Once Hai filed his motion for discontinuance on the Wang case, Mo sent Hai a letter threatening to take legal action against him unless he discontinued the case with prejudice. Yet Hai claims he was not fired, but recommended that the plaintiffs move the case to federal court and hire attorneys who specialize in federal labor laws.

Desperate Housewives v ABC

Nicollete Sheridan's lawsuit against ABC has resulted in a mistrial. Sheridan, who starred on the show, filed a lawsuit against ABC and the show's creator Marc Cherry, claiming that she argued with Cherry over a script, and he allegedly hit Sheridan in the head, then killed her character, eliminating her acting job. Sheridan sought $5.7 million in back pay from ABC. The jury was deadlocked at 8-4 in favor of the actress, and nine jurors needed to agree on a verdict. The jurors deliberated for three days, citing credibility of witnesses as the reason for their prolonged deliberations.


March 29, 2012

NFL Bounty Scandal

By Thomas Grove

Last week, NFL Commissioner Roger Goodell issued severe penalties against the New Orleans Saints, its general manager, and members of its coaching staff for running a bounty program. Under the program, money was given to players for targeting players on other teams and injuring them. As a result of the program, Saints head coach Sean Payton was suspended for a year without pay, former Saints defensive coordinator and current Rams defensive coordinator Gregg Williams was suspendedindefinitely without pay, general manager Mickey Loomis was suspended eight games without pay, assistant head coach Joe Vitt was suspended six games without pay, the Saints forfeited a 2012 second-round draft pick and a 2013 second-round draft pick, and were fined $500,000.

An NFL investigation uncovered evidence of a bounty program during the 2009, 2010, and 2011 seasons. The pot was mostly funded by players who would then be awarded for "knock-outs" and "cart-offs", which are words typically associated with injuries. Specific players were also targeted, namely Brett Favre, Kurt Warner, Cam Newton, and Aaron Rodgers. (Id.)

Head coach Sean Payton denied the allegations in 2012 and said to his assistants, "let's make sure our ducks are in a row", when investigators began pressing for information. Payton is obligated under the NFL Constitution and Bylaws to "communicate openly and candidly with the principal owner and/or his designated representative to ensure that club ownership is informed on a complete and timely basis of all matters affecting the club's operations; and to avoid actions that undermine or damage the club's reputation or operating success". He has a similar obligation under the standard coaching agreement he signed with the Saints. (Id.)

Commissioner Goodell issued a statement detailing how this situation was "particularly unusual and egregious." He stated, "when there is targeting of players for injury and cash rewards over a three-year period, the involvement of the coaching staff, and three years of denials and willful disrespect of the rules, a strong and lasting message must be sent that such conduct is totally unacceptable and has no place in the game." He added "there is no place in the NFL for deliberately seeking to injure another player, let alone offering a reward for doing so. Any form of bounty is incompatible with our commitment to create a culture of sportsmanship, fairness, and safety. Programs of this kind have no place in our game and we are determined that bounties will no longer be a part of the NFL." (Id.)

The coaches and general manager can appeal their suspensions, but the appeal process returns to Commissioner Goodell. If they appeal, the coaches can continue to work for their teams, but Goodell has stated that any decision would be expedited. Further, appeals go straight back to the man who handed down the sentence, and league counsel Jeff Pash said, "we are comfortable with the sanctions."
(King, Peter, "Bounty Saga Still Dominating League Landscape at Owners Meetings," Mar. 26, 2012, available at http://sportsillustrated.cnn.com/2012/writers/peter_king/03/26/meetings/index.html)

One remaining issueyet to be decided is the penalty for the players who took part in the program. Currently, the Commissioner's Office and the NFLPA are working on proper punishments for the players. Commissioner Goodell could suspend and/or fine any player that has been deemed to have taken any part in bounties. Currently, Jonathan Vilma has been named as personally offering $10,000 to any Saints player who knocked Brett Favre out of the 2010 NFC Championship Game.

Aside from league penalties, players and coaches could face criminal charges for their role in the program. Under Louisiana law, "battery is the intentional use of force or violence upon the person of another." Although players assume the risk of getting injured when they play football, they do not assume the risk of another player purposefully attempting to injure them. This could also apply to second-degree battery, which carries a more severe penalty under Louisiana law. Second-degree battery "is a battery when the offender intentionally inflicts serious bodily injury" and serious bodily injury is defined as "bodily injury which involves unconsciousness, extreme physical pain or protracted and obvious disfigurement, or protracted loss or impairment of the function of a bodily member, organ, or mental faculty, or a substantial risk of death." A player who inflicted a "knock out" hit could arguably have inflicted serious bodily injury under this statute.
(McCann, Michael, "Breaking Down the Potential Legal Fallout of Saints' Bounty System," Mar. 3, 2012, available at http://sportsillustrated.cnn.com/2012/writers/michael_mccann/03/03/saints.bounty.system/index.html)

The government could also get involved in this scandal. Taxes are as American as football and the IRS has reportedly begun "poking around" the bounty program for potential tax evasion charges.Pay for performance programs are outlawed in the NFL and any player receiving extra money would have to report it as taxable income. Furthermore, Senator Dick Durbin from Illinois requested a hearing by the Judiciary Committee to explore the bounties. The government has recently held hearings dealing with NFL issues, including the lockout, performance-enhancing drugs, player safety, and the television blackout policy, so this comes as no surprise.
(Pasquarelli, Len, "IRS Among Federal Agencies 'Poking Around' in 'Bountygate,'" Mar. 26, 2012, available at http://www.cbssports.com/nfl/story/18059904/irs-among-federal-agencies-poking-around-in-bountygate)

Participating in a bounty program raises serious issues of a player's integrity, especially with the recent rise of player safety. The Saints may seek to terminate a player's contract "for cause" because bounties are criminal in nature. Terminating "for cause" would relieve the Saints of that player's financial obligations for the remainder of his contract. The Saints could also seek to void the contract under the morals clause, as this type of behavior raises serious issues relating to a player's integrity.

March 30, 2012

Weekly Issues in the News

By Geisa Balla


Facebook Inc. moved to dismiss Paul Ceglia's complaint on March 26, 2012. Paul Ceglia filed a lawsuit against Mark Zuckerberg and Facebook in 2010, claiming that pursuant to a contractual agreement with Zuckerberg, he owns 50 percent of the social media site. In his complaint Ceglia had attached documents, now at issue, to show that this agreement existed. In its motion to dismiss, Facebook called the claims a "fraud and a lie", and depicted Ceglia as desperate for cash. The motion discusses the results of months-long investigations and forensic analysis of emails from Zuckerberg's college days. This investigation, according to Facebook, showed that Mr. Ceglia forged the contract and then attempted to cover his tracks with fake emails. Facebook claims that the second page of the contract produced by Ceglia does in fact contain Zuckerberg's signature, but the contract that Zuckerberg singed had a different first page. Facebook alleged that Mr. Ceglia baked the contract in the sun so the ink would appear aged and could not be tested by experts. Facebook also claimed that none of the emails in Mr. Ceglia's complaint showed in its search of Harvard's servers.


Nike v Reebok

Southern District of New York judge Kevin Castel issued an order on March 28, 2012 in favor of Nike Inc., blocking Reebok International from selling New York Jets apparel featuring the name of Tim Tebow. Nike filed a licensing dispute lawsuit against Reebok on March 27, 2012. The Denver Broncos traded Tebow to the Jets on March 21st. The order prevents Reebok from manufacturing, selling and shipping the alleged unauthorized apparel for the NFL team and bearing Tebow's name. The order also requires Reebok to offer to buy back any such apparel from retailers and recall products from shipping channels. The court denied Nike's demand to destroy any unauthorized Tebow products. Nike's complaint alleged that Nike will begin an exclusive five-year contract with the NFL to sell uniforms and related apparel for all 32 NFL teams on April 1, 2012. Nike claims that Reebok has no current agreement to sell Tebow/Jets products and that Reebok's licensing agreement with the NFL expired prior to this month. Nike's lawsuit does not concern Broncos products, or those made before March 1, 2012. A hearing is set for April 4, 2012, to decide whether the ban should be extended.

Gucci v. Guess

Gucci's trademark infringement trial against Guess in the Southern District of New York began on March 28, 2012. Gucci first filed a trademark infringement lawsuit against Guess in 2009, claiming that Guess was selling items with logos that are "studied imitations of the Gucci trademark." The trademarks in questions are a green and red stripe design, a square G, the designer's name in flowing script and a diamond pattern with repeating interlocking G's. Gucci claims that Guess knocked off over $221 million in Gucci products. Guess had argued in court filings that Gucci cannot claim infringement because it sat on its rights for at least seven years before taking action against Guess. In his opening argument, Guess attorney Daniel Petrocelli also argued that the two brands are different, that Guess had no reason and did not scheme to be like Gucci, and while Gucci uses leather, Guess uses plastic. He noted that Guess products are less than $100 and are geared toward women who cannot afford luxury goods like Gucci. Gucci is seeking damages of more than $124 million. The trial is expected to last two weeks.

Dolce & Gabbana

Dolce & Gabanna filed a lawsuit in the South African Western Cape High Court against gift shop Dolce & Banana. The lawsuit demands Dolce & Banana to change its name, and accuses Dolce & Banana of "objectionable conduct and of "diluting" the luxury brand's name. Shop owner Mijou Beller promptly changed the name of the shop to " ... & Banana."


Gagosian Gallery Trials and Tribulations

By Gergana Miteva

Gagosian Gallery e-mails reveal the "behind the scenes" of the litigated sale of Girl in Mirror. (http://www.nytimes.com/2012/03/27/arts/design/revealing-e-mails-by-gagosian-gallery-in-lichtenstein-suit.html)

Recently, the embattled Gagosian Gallery suffered another legal setback. New e-mails have come to light, suggesting that in his negotiations to sell a painting, Larry Gagosian, the owner of the Gagosian Gallery, ardently solicited a "low ball" bid from a buyer. In January, Jan Cowles, a prominent New York art collector, filed a lawsuit against Gagosian and his gallery for conversion, fraud, breach of fiduciary duty, and unjust enrichment over the sale of a painting from her collection. The piece in question is Roy Lichtenstein's 1964 Girl in Mirror, which is one of a series of eight pieces in epoxy enamel on metal. In her complaint, Mrs. Cowles alleged that in the fall of 2008, Mr. Gagosian struck a deal with her son, without her knowledge or consent, to sell the painting on consignment for $3 million and retain half a million dollars as commission. The plaintiff maintains that the piece's market value at the time had been $4.5 million. Mrs. Cowles further alleged that her son, who had been an art dealer for many years, had no authority to sell the painting and acted without her knowledge only because he was in a "desperate financial condition." (See Jan Cowles' complaint, available at (http://www.courthousenews.com/2012/01/20/Gagosian.pdf).

Mr. Gagosian eventually sold the piece for $2 million and retained a $1 million commission. The plaintiff claimed that Mr. Gagosian induced her son to accept the "below market sales price" by falsely representing that the painting was badly damaged. She argued that if there had been any damage to the work, Gagosian Gallery's staff would have documented it before accepting the painting on consignment, which is a customary practice in the industry to avoid subsequent disputes about the value and condition of the artwork. Mrs. Cowles further implies that at the time of the sale of the painting, the Gagosian Gallery had a second piece from the Girl in Mirror series that may have been damaged. Her theory is that Gagosian sold the damaged painting for $2 million while her painting may still be in Gagosian's possession. If Mrs. Cowles is able to back up this admittedly cinematic hypothesis, she would provide a plausible explanation of the sold painting's condition report, which describes the damage as "numerous dark inclusions and small pits in the yellow field," "three areas of discoloration," "altered texture" and "noticeable prior restoration."

As The New York Times reported, the latest papers filed by Mrs. Cowles' attorney reveal the e-mail negotiations between Mr. Gagosian and the art collector who eventually bought the painting. Apparently, Gagosian represented that the seller of the work was "in terrible straits and needs cash" and invited the art dealer to make "a cruel and offensive offer" for the painting. This new evidence, coupled with Mrs. Cowles' theory that the piece had been swapped with a damaged one, may account for why it was sold for less than half of its claimed market value at the time. (Randy Kennedy, Frank E-Mails Reveal Negotiations at Art Gallery, N.Y. TIMES, March 26, 2012, http://www.nytimes.com/2012/03/27/arts/design/revealing-e-mails-by-gagosian-gallery-in-lichtenstein-suit.html)

This is not the first time Mr. Gagosian and his gallery have been sued over the sale of a painting from Mrs. Cowles collection. Last year, Mrs. Cowles filed a lawsuit in Federal court for the gallery's sale of The Innocent Eye Test by Mark Tansey, another piece her son had put up for sale. Apparently, she had donated 31 percent of her interest in the painting to the Metropolitan Museum of Art, where the painting was on display for many years, with the intention of eventually transferring her entire interest in the work to the museum. Mrs. Cowles sued Gagosian for the return of the painting and the British collector who purchased it sued him for fraud. The case was settled for $4.4 million after the piece was returned to Mrs. Cowles, who then donated it to the museum. This prior implicit victory for Mrs. Cowles adds more ammunition to the merits of her case in the current dispute with Gagosian. (Randy Kennedy, Collector Sues Gagosian Gallery for Selling Him a Painting Partially Owned by Met, N.Y. TIMES, March 11, 2011, http://artsbeat.blogs.nytimes.com/2011/03/11/collector-sues-gagogosian-gallery-for-selling-him-a-painting-partially-owned-by-met/).

Mrs. Cowles is seeking $4.5 million in compensatory damages and $10 million in punitive damages for the Girl in Mirror sale.

About March 2012

This page contains all entries posted to The Entertainment, Arts and Sports Law Blog in March 2012. They are listed from oldest to newest.

February 2012 is the previous archive.

April 2012 is the next archive.

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