TechLaw

Drug Marketers File Cert Petition in Ayotte Privacy Case

The SCOTUSBlog has news that a petition for certiorari was filed today in the case of IMS Health v. Ayotte. In proceedings below, the First Circuit, in a landmark privacy ruling, turned back prescription drug marketers' claim that they had a First Amendment right to distribute data that identified doctors' drug-prescribing patterns. New Hampshire law banned the distribution of this information, based on evidence that it was distorting physician drug-prescribing practices away from generic drugs and in favor of more expensive brand-name drugs. To the detriment of the state's health care budget.

A key passage in the First Circuit's opinion went like this: "The societal benefits flowing from the prohibited transactions pale in comparison to the negative externalities produced. This unusual combination of features removes the challenged portions of the statute from the proscriptions of the First Amendment.”

Similar laws are in place in Vermont and Maine.

“This is an important decision for data privacy advocates,” Sean Flynn, a professor at the Washington College of Law at American University and counsel for the public interest amici in the case, said at the time. “The ramifications of giving companies a First Amendment right to sell data on all of our purchases, travel and activities would be staggering.”

A copy of the First Circuit's ruling in IMS Health v. Ayotte, No. 07-1945 (1st Cir. Nov. 18, 2008), is available here.

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For the Record, We Have No Opinions Here

A few days ago a wrote a blog post complaining about how somebody somewhere had decided to make the U.S. Department of Justice's brief in the Tenenbaum case a litmus test on whether President Obama had the right views on copyright policy. Their argument went like this: Draconian statutory damages for copyright infringement are an injustice. President Obama couldn't possibly be in favor of injustice, could he?

And I just didn't see it that way. Statutory damages of $150,000 for willful copyright infringement may feel like an injustice to many people, especially when it comes to copying digital materials. Nevertheless, the Department of Justice -- under any administration -- has an obligation to intervene in cases raising important questions of federal law and to defend the government's interest if it can make a good legal argument for it. The DOJ does this in many cases each year. That was the point I wanted to make. I thought it was a shooting-fish-in-a-barrel effort, which I felt equipped to handle.

The post generated a lot of interest, a good thing, because this is usually a very low-traffic blog. Unfortunately, some of the interest was of the "bad" variety. Ben Sheffner wrote a supportive post at his Copyrights and Campaigns blog under the unfortunate headline "BNA debunks `RIAA' infiltration theory of DOJ's Tenenbaum intervention.

I wish Mr. Sheffner hadn't written that.

And this morning Ray Beckerman, an attorney involved in what seems like quite a few file-sharing cases against record company plaintiffs and author of the Recording Industry vs The People blog, wrote the following comment here:

Mr. O'Toole:

Thanks for your well written post.

As the Department of Justice concedes, an award of statutory damages would be subject to Due Process review for excessiveness.

So, since you quite rightly abhor "the fallacy of attacking the character/situation of the person advancing an argument instead of trying to disprove the soundness of the argument", please give us your position on:

1. whether or not an award of from 2,100 to 425,000 times the lost profit would pass constitutional muster,

2. whether it was necessary for the Government to take the position that it does, in order to defend the facial constitutionality of the statute, and if not, why, in your estimation, it did take that position,

3. whether, in determining the "law of the land", precedence is given to the Constitution or to the Copyright Act, and

4. which of the types of "argument" it was for the Justice Department to simply ignore the 6 authorities cited by the amicus curiae brief suggesting that the State Farm/Gore test would be applied to the due process assessment.

Best regards

Ray

http://recordingindustryvspeople.blogspot.com

That was unfortunate too, because I don't have a good response to Mr. Beckerman.

To Mr. Sheffner I say this:

BNA's bread and butter is objective, actionable information. We don't do advocacy journalism, and we don't do personality journalism. We try really hard to report the facts and then let our readers -- overwhelmingly attorneys, government officials, and business executives -- do the thinking for themselves. That's worked for a long time. Objectivity = Success. That's really ingrained around here.

But it doesn't work that way on the Web, does it? Everybody is vying for attention, and the way you get attention is to have a point of view, start a conversation, or engage in a conversation that is already going on. But this blog has a BNA logo on it, so I can only go so far. That seems fair. BNA is bigger than me. I shouldn't want to burden BNA with my opinions, however much I am personally fond of them.

BNA makes no money off the Techlaw blog. I do it in my spare time. Despite the hundreds of reporter/editors we have here, there is only one BNA-written blog. This one.

So I winced when I read the headline "BNA debunks." I like it when people agree with me. But we don't "debunk" at BNA. We report.

To Mr. Beckerman I say this:

I appreciate your advocacy and the energy you bring to your job. I also appreciate the generosity that is reflected in your blog. There is a lot of good information there, I read it often, I've learned from you. My father was a trial attorney for nearly 50 years. He identified with his clients in a visceral way, I think he felt it was important to believe his arguments were unassailable in order to do a good job, and he was just miserable on the eve of a trial. So I get where you are coming from.

My "position" on the legal issues you mention is that whatever outcome is reached in the Tenenbaum case, after everyone's argument has been thoroughly aired and considered, is the right outcome. Neither myself nor anyone else at BNA feels otherwise.

I'm going to pick up my ball now and walk to the next tee.

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Lawyers, Stop Winging It With ESI Keyword Searches

Apparently there is a great problem out there with lawyers writing keywords in electronic discovery requests. According to one magistrate judge, lawyers in a construction liability case submitted vague keywords that produced nearly all of the opposing side's e-mail database, redundant keywords, and keywords that were ineffective at producing discoverable information. This kind of bad lawyering put the magistrate in the position of having to design the keyword search himself, something he was neither inclined nor equipped to do.

In William A. Gross Construction Associates Inc. v. American Manufacturers Mutual Ins. Co., No. 07 Civ. 10639 (S.D.N.Y. March 19, 2009), Magistrate Judge Andrew Peck complained:

This Opinion should serve as a wake-up call to the Bar in this District about the need for careful thought, quality control, testing, and cooperation with opposing counsel in designing search terms or "keywords" to be used to produce emails or other electronically stored information ("ESI"). While this message has appeared in several cases from outside this Circuit, it appears that the message has not reached many members of our Bar.

...

Electronic discovery requires cooperation between opposing counsel and transparency in all aspects of preservation and production of ESI. Moreover, where counsel are using keyword searches for retrieval of ESI, they at a minimum must carefully craft the appropriate keywords, with input from the ESI's custodians as to the words and abbreviations they use, and the proposed methodology must be quality control tested to assure accuracy in retrieval and elimination of "false positives." It is time that the Bar -- even those lawyers who did not come of age in the computer era -- understand this.

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"DOJ Sides With RIAA" One Day Later

On most days you can learn a lot browsing the Internet. Yesterday probably wasn't one of those days. Consider the following evidence, which I turned up while trying to find out about the latest wrinkle in Sony BMG Music Entertainment v. Tenenbaum, No. 03-11661 (D. Mass.) -- the Department of Justice's just-filed amicus submission in that case.

Slashdot: Obama DOJ Sides With RIAA

CNET: Obama administration sides with RIAA in P2P suit

Wired: Obama Sides With RIAA, Supports $150,000 Fine per Music Track

Industry Standard: Obama's "pro-copyright industry" Department of Justice sides with RIAA's $150,000 per song penalty

The Register: Obama Sides With RIAA in P2P Fight

Billboard: Department of Justice Backs RIAA in P2P Suit

This nugget sums it up well:

"The Obama administration has sided with the recording industry in a copyright lawsuit against an alleged peer-to-peer pirate, a move that echoes arguments previously made by the Bush administration."

So much siding. Not only is President Obama dictating how the Department of Justice argues its cases (via his Nixonian DOJ remote control device), but he is doing so in service of the recording industry (hiss!), just like the Bush administration (hiss! hiss!!) did before him. Obama's probably got a thespian or two in the DOJ as well. Philosophers call this the argumentum ad hominem, the fallacy of attacking the character/situation of the person advancing an argument instead of trying to disprove the soundness of the argument. The argumentum ad hominem is a fallacious argument so potent that it is the only one I actually remember from philosophy class.

Reading all of this strangely uniform reporting, you'd be forgiven for thinking that the Department of Justice had decided to support tough statutory damages for copyright infringement because it was infested with entertainment industry lawyers.

I don't think this view of the world aligns well with reality.

First, the law in question, the Digital Theft Deterrence and Copyright Damages Act of 1999, is the law of the land. The statute increased the amount of statutory damages a court can award in a copyright case: up to $150,000 per violation in cases of willful infringement. It passed both the Senate and the House with nary a dissenting vote, and it was signed into law on Dec. 9, 1999, by President Bill Clinton, Democrat, sax player and all-around decent guy. It is, as they say, a done deal. If you want to learn how copyright law gets written in the United States, read Prof. Jessica Litman's Digital Copyright. If you want to change how copyright law gets written in the United States, visit Change Congress. I don't think the Department of Justice is the bogeyman here.

Second, the actual -- and really interesting -- questions that the district court in Tenenbaum wanted the Department of Justice's views on involved the constitutionality of Congress' decision to authorize such large statutory damage awards in a civil proceeding. The defendant is contending that the statutory damage provisions are so oppressive and unrelated to the amount of actual harm that they violate due process as well as the Eighth Amendment's prohibition of excessive fines.

When the Department of Justice fields questions like this, it doesn't write on a clean slate. It doesn't check the results of the most recent election, it doesn't consult the views of high-ranking appointed officials, and it doesn't in any way embark on a quest for the "right" outcome. Rather, the traditional view within the Department of Justice is that it has an obligation to defend the constitutionality of all federal laws, except in the rarest of circumstances. Former Solicitor General Seth P. Waxman (1997-2001) described the approach of the Solicitor General's Office like this:

Vigorously defending congressional legislation serves the institutional interests and constitutional judgments of all three branches. It ensures that proper respect is given to Congress's policy choices. It preserves for the courts their historic function of judicial review. And it reflects an important premise in our constitutional system - that when Congress passes a law and the President signs it, their actions reflect a shared judgment about the constitutionality of the statute. In the mine run of cases, it is fair to presume that the Congress that passed the legislation and the President who signed it were of the view that the law conformed to the Constitution as construed by the Supreme Court. In such cases, Solicitors General defer to Congress and the President's articulation of the constitutional "interests of the United States," as reflected in the enactment. They do not attempt to reach our own best view of a statute's constitutionality; rather, they try to craft a defense of the law in a manner that can best explain the basis on which the political branches' presumed constitutional judgment must have been predicated.

I've taken Waxman's remarks from his article, "Defending Congress," published at 79 N.C.L. Rev. 1073 (May 2001). Unfortunately, the article is not available on the free Web. In a subsequent passage, one that has relevance for cyberlaw followers, Waxman illustrates how making a strong argument in support of congressional lawmaking can be an uphill climb:

Let me provide an example some people chuckle to recall. In 1996, Congress passed a law known as the Communications Decency Act. The law was enacted without hearings or committee consideration. It imposed criminal penalties on anyone who made available to minors on the Internet material that was "indecent" or "patently offensive." The Act was challenged before two three-judge district courts. All six judges found the law facially unconstitutional in every respect. The Justice Department's Civil Division recommended appeal to the Supreme Court, and my predecessor as Solicitor General agreed. Having argued the case, I can confirm that there is nothing quite like standing in front of the Supreme Court to defend the constitutionality of a law that not a single judge has ever found to be constitutional in any respect. The United States did lose (although we garnered two votes for two-thirds of the statute). But our adversarial system of constitutional adjudication was served. The United States' briefs served the valuable purpose of articulating for the Supreme Court the strongest possible rationale in support of constitutionality - a much stronger case than anything that had been articulated by or to Congress. Those arguments in turn prompted the parties challenging the statute to hone and improve their own positions. And when the Court concluded that the statute should be invalidated, it did so with assurance that it had considered the very best arguments that could be made in its defense.

Most constitutional lawyers feel the same way. The Department of Justice's obligation is to defend the Copyright Act as Congress wrote it, not to re-evaluate or critique it. I am pretty sure the DOJ's submission would have looked the same, even if the office was not brimming with RIAA attorneys. You can read the DOJ's brief for yourself and decide whether you buy it. Who knows? The DOJ's arguments in Sony BMG Music Entertainment v. Tenenbaum may turn out to be losing ones, just like they were in the case Waxman alluded to above, Reno v. American Civil Liberties Union, 521 U.S. 844 (1997).

Cinderella Stories

When it comes to college sports, I always root for Michigan, I can't help it. I always pick them to win it all, even though the last time Michigan won anything was when Chris Webber was on the payroll in 1993. The fact that I am wrong, that I have been wrong for 18 years in a row, means less to me than the pleasure I get from picking Michigan to win it all.

Last night when I finally finished filling out my NCAA basketball tournament brackets (I have Michigan defeating Memphis in the title game), it occurred to me (it was late!) that the way I think about the basketball tournament -- my love of the underdog and my selective memory -- is similar to the way a lot of us view tech policymaking. And that's a bad thing. We tend to cast tech policy matters in terms of win-lose affairs, deluding ourselves into thinking that they will be close, hard-fought close contests. Emotionally, it is satisfying to entertain the idea that the underdog will win. Marketers vs. Privacy Advocates. "Innovators" vs. Telco Operators. IP Owners vs. Fair Use Advocates. But these are never close contests. The same teams always win. What a facile way to look at law.

In sports, as in much of life, we love to root for the underdog. Hoosiers, Rudy, Rocky. It's all the same. Somebody we can identify with lands the big punch, makes a long run, hits the last-second shot and in the process pulls off an improbable yet emotionally satisfying victory.

This is a psychological booby trap that can kill you at tournament time. And in handicapping politics.

That's why they call it March Madness. Delusion is a form of madness. Very few of us possess the hard data necessary to pluck out the best teams among this year's 64 entrants. We have only our emotions. When it comes to filling out our tournament brackets, the exploits of underdogs past loom large in our memories. We remember the underdogs, not the winners.

Not many people remember who won last year's tournament. But everybody remembers Davidson's Stephen Curry draining threes against Gonzaga, Georgetown, and Wisconsin, en route to a two-point loss to Kansas in the Midwest Regional Final.

In 2006, the role of Cinderella was played by George Mason, a small school just south of Washington, D.C., which made it to the Final Four that year, stunning college basketball bluebloods Michigan State, North Carolina, and Connecticut along the way.

Cherished memories of the underdog's rare victory obscures the fact that, in nearly every contest, the favorite wins. David's late, lucky shot against trash-talking Goliath has totally overshadowed the fact that the Philistines dominated the Jews for a generation before that.

The favorite always wins. Three-quarters of the time, anyhow. Perhaps you'll recognize this list of recent tournament winners: Kansas (2008), Florida (2007), Florida (2006), North Carolina (2005), Connecticut (2004), Syracuse (2003), Maryland (2002), Duke (2001), Michigan State (2000), Connecticut (1999), and Kentucky (1998). Not an underdog in the bunch.

Just for facile fun, I've made up a list of the 16 teams I'd put in a hypothetical Tech Policy Bracket. And I've ranked them -- "seeding" in tourney jargon -- according to who has the better record and best prospects for success this year. This list isn't about who I want to win but who has actually been winning these games. All games will be played in Washington, of course.

(1) AT&T. Perennial top seed. Plodding, methodical team. Likes to Big Foot opponents, offense consists mostly of dunks.

(2) IP Owners. Recruits some of the best talent in the country, players have a reputation for flopping. Always pleading with the NCAA for rule changes.

(3) Business Lobbyists. Persistent, in-your-face defensive specialists. Along with AT&T and IP Owners, among the largest donors to the Referee Retention and Retirement Fund. Tends to get the close calls.

(4) Google. Literally came out of nowhere, boasts a "Beat us if you can" attitude. Relationship with referees will be key.

(5) Amazon. Like Google, made it to the Big Dance on hustle alone. Will shoot from anywhere on the court.

(6) Online Marketers. Rarely defeated, they still play with a chip on their shoulder. They love to run up the score on inferior opponents.

(7) White House. Story here is Barack Obama. Lit it up last fall, untested on the big stage.

(8) Apple. Flashy, high-scoring, can beat you with hardware or software. Rabid fans.

(9) Free Software. Fundamentally sound. International fan base. Plays to sellout crowds, possibly due to free ticket promotions.

(10) Bloggers. Reputation for trash-talking and making long shots, players frequently play in their pajamas.

(11) Federal Trade Commission. Fundamentally sound with lots of offensive firepower, but very rarely uses it.

(12) State Legislatures. Historically a powerhouse, lately has fallen on hard times. Resourcefulness is going to be key to victory.

(13) Newspapers. Coping with deteriorating training facilities and loss of alumni support, this year's team is wearing uniforms purchased in 1989.

(14) ICANN. Getting it done with smoke and mirrors, this team often plays abroad. Spends a lot of time on public relations.

(15) Internet User Advocates. Talented but underfunded, the players on this team have not yet learned to play together.

(16) Internet. A hardy opponent, often taken for granted.

(Going to the NIT this year: Microsoft, Yahoo!, Dell, Research in Motion)

Looking to the first round games, I see AT&T (1) easily getting past Internet (16) with a combination of throttling, traffic management, and content deals. The Apple (8) - Free Software (9) matchup is too close to call, I could go either way on it, but I would love to see Apple meet AT&T in the second round. Amazon (5) is going to have a lot of trouble with State Legislatures (12), and I don't see them being able to turn back State Legislatures' need for tax revenues, especially in these tough economic times. Google (4) has been killing Newspapers (13) for years now; that should continue in this game.

The Online Marketers (6) matchup against Federal Trade Commission (11) is game you'd think would be a close one. But historically Online Marketers have won every time. I see them getting through to the next round in easy fashion. It's also a safe bet that Business Lobbyists (3) will crush ICANN (14) in what I see as a low-scoring, defensive battle. I'll be very surprised if ICANN gets makes any of its new gTLD shots.

White House (7) versus Bloggers (10). It's a shame they had to meet in the first round, since Bloggers were so instrumental in Obama's win last fall. I'm going to give this one to White House. Having the Commander in Chief on your team has got to count for something.

The final first round game, IP Owners (2) vs. Internet User Advocates (15), is shaping up to be another walkover. Internet User Advocates didn't score a single point in the Copyright Term Extension Game and scored just a handful of points in the Digital Millennium Copyright Game. No matter how much publicity is given to this game, the fact is that if it wasn't constitutionally required IP Owners and Internet User Advocates wouldn't even be on the same court together.

My Final Four is AT&T, Google, Business Lobbyists, and IP Owners. After that, I don't see Google getting past AT&T. Maybe next year. In the other semi, IP Owners' greater experience and depth, combined with an overwhelming need to win, should get them through to the final. An AT&T-IP Owner final is really too close to call. I've been hearing for years that, if they had the opportunity, they'd cut a deal and share the title. Not this year. My pick: AT&T.

Go Blue.

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Fourth Circuit Hands Down Important Privacy Decision. Ouch.

The Fourth Circuit released its opinion this morning in Van Alstyne v. Electronic Scriptorium, No. 07-1892 (4th Cir. March 18, 2009). Nutshell: Plaintiffs who sue for violations of the Stored Communications Act, 18 U.S.C. 2707(a), must prove actual damages in order to qualify for the $1,000 per violation statutory damages provided by the act. Ouch!

In a case involving an employer's intrusion into an employee's personal e-mail account, the court said that the pertinent language in the SCA ("actual damages suffered") was substantially similar to language in the Privacy Act, 5 U.S.C. 522a(g)(4)(A)("actual damages sustained"). The U.S. Supreme Court has already ruled, in Doe v. Chao, 540 U.S. 614 (2004), that statutory damages are not available under the Privacy Act without proof of actual damages. Ditto for the SCA, the Fourth Circuit decided.

Several courts have previously held that a showing of actual damages is not required to entitled plaintiffs to statutory damages under the SCA. But the Fourth Circuit made short work of these rulings, stating that they were at odds with the teaching of Doe v. Chao.

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Stanford E-Commerce Best Practices Conference

The Sixth Annual E-Commerce Best Practices Conference will take place on June 12, 2009, on the Stanford University campus. Right now, this is probably the best annual event going for learning about cyberlaw topics (in my uncompensated, unsolicited opinion).

Rick Boucher, Policy Prognosticator

The RSS feed hauled in this item from the National Journal, As Media Evolves, Hill Tries To Define It:

Speaking at a Center for Democracy and Technology gala last week, Rep. Rick Boucher, D-Va., predicted that federal shield legislation he introduced in February would pass the House and Senate this session. The bill, H.R. 985, would protect reporters from being compelled to reveal confidential sources even under subpoena.

Rep. Boucher could be right here. On the other hand, it didn't take too much digging to find this gem in the BNA archives, Rep. Boucher Predicts Speedy Success for Privacy Bill to Be Introduced Early 2002.

A new Internet privacy bill has been drafted by members of the House of Representatives Energy and Commerce Committee and is scheduled to be introduced in early 2002, according to one of its proponents, U.S. Rep. Frederick C. Boucher (D-Va.). Boucher, who spoke at the Georgetown University Law Center's “Advanced E-Commerce: New Rules, New Realities” conference Nov. 8, in Washington, D.C., said he expected that once introduced, the bill would cut a speedy path through the House and, although it might meet some resistance in the upper house, that the Senate would eventually approve the bill.

“I anticipate passage of this bill to be quite rapid,” he said.

"Rapid." Oh well, you can't be right all the time. And who can predict what shape H.R. 985 will be in, after the Department of Justice is finished with it? If Eric Holder is making predictions about H.R. 985, that's where I'd put my money.

Web Host/Kiddie Porn Impresario Isn't Entitled to CDA 230 Immunity

A very interesting case involving online publisher immunity under Section 230 of the Communications Decency Act came out of Michigan earlier this month in the case of People v. Gourlay, No. 271214 (Mich. Ct. App. March 3, 2009)(unpublished). The CDA 230 issue arose in the context of a criminal prosecution for child pornography tucked inside an ineffective assistance of counsel claim. But even at that procedural distance the court's exploration of how CDA Section 230 might apply to hosting unlawful content is worth reading.

It's a weird case, involving an underage boy who was "self-publishing" over the Internet videos of himself engaged in sexual acts. This was before he came to the attention of defendant Gourlay. After the defendant saw the videos on the Internet, he contacted the boy and together they hatched a plan to take the boy's Web site to "the next level." The defendant involved himself in the boy's activities by registering a new domain name, hosting the site, supplying some computer programming to permit the Web site to supply video streaming of the boy's activities via a premium, members-only portion of the site. The defendant also allegedly advised the boy how to use the camera and "act" for maximum effect. Together, they developed two Web sites.

The defendant was tried and convicted of three state-law child pornography offenses. On appeal, he argued that he was entitled to a new trial because his attorney had failed to request a jury instruction advising the jury that, under CDA Section 230, "an Internet service provider does not create pornography by providing bandwidth or by providing technical or artistic assistance."

The appellate court accepted the defendant's arguments that he was an interactive computer service provider for CDA Section 230 purposes, and that CDA Section 230 potentially immunized him from state-law criminal prosecution. At this point, the court could have -- but didn't -- simply ruled that the defendant was an "information content provider" not entitled to immunity because he had involved himself in the creation of the child pornography being streamed via the boy's Web site. CDA Section 230(f)(3) defines an "information content provider" as "any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet ...."

Instead, the court looked at the elements of the criminal offenses that the defendant was convicted of and compared them to the activities of a hypothetical interactive computer service provider. At least that's what I think the court was doing here. The charged offenses required proof that the defendant actively and intentionally directed the child to engage in sexual activity for the purpose of producing child pornography. Other charges for distributing or promoting child porn required proof that the defendant promoted or distributed child pornography with criminal intent. In other words, the court said, the prosecution alleged and proved that the defendant was a knowing, active participant in the creation of the two Web sites. These activities do not fit the definition of an interactive computer service provider, the court reasoned, so the defendant was not entitled to a jury instruction on CDA Section 230.

Along the way the court remarked that it could imagine a child porn prosecution in which a Web host was entitled to a CDA Section 230 defense, such as might be the case if a Web host continued to make available child porn even after it had received notice that the material was available on its network. "However," it said, "the prosecution of defendant for distributing or promoting child sexually abusive material was not based on such a theory."

Who knows what to make of this case? I don't think it stands for the proposition that a Web host distributing user-generated pornography is in danger of losing its CDA Section 230 immunity. The defendant recruited the boy to go into business with him, so he was actively involved in the creation of the unlawful material. The court made no mention of whether the defendant was making money off the site other than a hosting fee (unfortunately, though the statute seems indifferent to this fact). And, as for his claim that the programming, domain name registration, and other hosting services he offered to the boy were standard Web hosting services, the court noted that the defendant failed to present any evidence at trial that he provided similar services to other customers.

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New Domain Name Registries Feeling Heat From Trademark Owners

More than ever before, Internet intermediaries are being asked to shoulder the responsibility of policing bad actors online. With copyright owners, it's "three strikes" proposals for ISPs and legal arguments that ISP compliance with the DMCA's notice-and-takedown provisions are not enough to escape secondary liability. Online publishers are busier than ever beating back attempts to find holes in CDA Section 230's immunity from claims arising from third-party content. And social networking sites, prodded by law enforcement officials, are undertaking new obligations to keep criminals from preying on their users.

The latest online intermediaries to feel the heat are domain name registries, the companies that manage registrations in the Internet's network of top-level domains. Ever since the beginning of the commercial Internet, trademark owners have complained that domain name registries should protect mark owners against the possibility that a squatter will register their mark, or some variation of it. Two 1999 documents, the Anticybersquatting Consumer Protection Act and the Uniform Domain-Name Dispute Resolution Policy, formed the basis of an uneasy truce between trademark owners and domain name registries and registrars. Domain name companies avoided trademark liability for infringing registrations and they were not saddled with a duty to perform expensive trademark checks on registrants. Trademark owners received a new federal cause of action for cybersquatting and an in rem process to go after the domain itself, plus a quick-justice, trademark-lite claim to "recuperate" the domain under the UDRP.

As I said, it has been an uneasy truce. The Internet Corporation for Assigned Names and Numbers and the registries and registrars it represents have done well under the current arrangement, selling millions of domains through an automated, "no questions asked" registration process. UDRP dispute resolution service providers, such as the World Intellectual Property Organization, have also enjoyed a tidy business throwing out the bad fish (and some that smelled just a little) in UDRP actions. And another entirely new industry -- domaining -- flourished, financed by PPV and PPC advertising. Not to mention domains used for phishing. And, of course, all legitimate actors benefit through low-cost domains.

But trademark owners have been miserable. Now that ICANN (a magical entity that can create online real estate out of thin air) is entertaining applications for what could be a substantial number of new top-level domains, trademark owners are back, and they are looking to cut a better deal than the one they cut in 1999. I think that nearly all trademark owners, and perhaps nearly all businesses, would like to see ICANN's effort to create new top-level domains dry up and blow away. Although the new domains would create new business opportunities and new avenues of expression for some, there is nothing in ICANN's proposal for the vast majority of Internet users. And nothing but a headache for trademark owners, who will initially be forced to spend money in purely defensive registrations and, down the road, be forced to file ACPA/UDRP claims to nudge registrants off infringing domains in the new top-level domains.

I see trademark owners' revenge in a WIPO proposal released last week (WARNING: this PDF is slow to load) calling for a "post-delegation process" that would permit trademark owners to take action against any new top-level domain registry itself if the registry "turns a blind eye to systemic cybersquatting in its domain, instead of adopting appropriate mechanisms to counter such abuse." Really? WIPO's own data indicates that systemic cybersquatting is already occurring in every commercially significant top-level domain. The WIPO proposal would permit trademark owners and WIPO to have their foot on the throat of any newly created top-level domain operator. According to the WIPO proposal, remedies for "turning a blind eye" to cybersquatting would include (1) transferring, canceling or locking domain name registrations, (2) injunctive relief (such as a prohibition against registration of domain names similar or identical to the complainant's mark, (3) implementation of "appropriate" rights protection schemes, (4) termination of contracts with selected registrars, (5) temporarily restricting the registry operator's right to sell new registrations, or (6) terminating the registry operator's agreement with ICANN. (My emphasis on that last one.)

Operating a new top-level domain does not sound like such a good business to be in anymore. Would anyone care to guess what a .com domain name registration would cost if Verisign had to play under WIPO's proposed rules? Looking at it from the domain name registry's view, I imagine it would be extraordinarily difficult for a registry to engage in business planning with WIPO ever-ready to root "systemic cybersquatting" out of its operation.

All of this is in addition to the sunrise protections and UDRP obligations against cybersquatters that now come standard with new ICANN top-level domains. The letter outlining the WIPO post-delegation proposal indicates that WIPO will be offering more details and pressing its case with ICANN in the coming weeks. ICANN continues to seek public comment here. The comment period expires April 13. It will be interesting to see how all of this sorts itself out this year.

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