Laws of .com

Volume V, Issue 15: September 27, 2007

SCO Group, Thorn to Linux, Seeks Bankruptcy Protection

Facebook Alleged to Cost Economy Millions

Class Action Suit Alleges that Cable Channel Bundling Violates Antitrust Laws

US Copyright Action Launched Over Open Source Breach

Chinese Woman Faces Legal Action From .eu Authorities

Man Faces 20-Year Imprisonment for False Threats Over Domain Names

New 'Open Access' Policy Introduced for Published Health Research

Google Accused of Misleading Web Users About Sponsored Links

Belgium Gaming Commission Files Complaint Against Online Political Gambling

SCO Group, Thorn to Linux, Seeks Bankruptcy Protection

SCO Group, formerly SCO, has filed for voluntary bankruptcy protection. SCO Group had claimed in various suits that it was the owner of copyright in UNIX operating system code and that significant portions of that code were improperly included in the widely distributed Linux operating system. SCO claimed billions from IBM and others, demanding that Linux users pay it royalties. Some, including Microsoft, signed up with SCO. However, Novell denied SCO was the copyright owner and claimed it owned the UNIX code. SCO sued its fellow Utah company Novell for slander of title. An August 2007 pre-trial ruling of the Utah District Court in the SCO v. Novell suit sided with Novell’s ownership claim and dealt a severe blow to SCO’s Linux infringement and royalty claims.

The court’s ruling means SCO Group now owes royalty payments to Novell.

For additional information, visit:
http://www.nytimes.com/2007/09/15/technology/15sco.html

For a copy of the Order, visit:
http://www.sco.com/scoip/lawsuits/novell/novell_377.pdf

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Facebook Alleged to Cost Economy Millions

A recent study conducted by the UK employment law firm Peninsula indicates that the British economy loses more than 233 million person hours per month due to the use of online social networking sites, such as Facebook and MySpace. The conclusion is that employers need to crack down on this new habit, as it allegedly costs the economy more than £130 million per day.

One argument against this analysis is that social networking sites could actually prove to be a benefit for certain types of employers. For a person whose job entails networking with clients and potential clients, there could be an upside to allowing employees access to such sites.

In any event, these staggering figures do not address the question of whether time being spent on social networking sites constitutes time that workers would otherwise spend doing their jobs. It may simply be that the novelty of online social networking provides a new way for employees to waste time, taking away from old fashioned dalliances, like reading the news or talking on the phone.

For additional information, visit:
http://news.bbc.co.uk/2/hi/technology/6989100.stm

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Class Action Suit Alleges that Cable Channel Bundling Violates Antitrust Laws

A class action lawsuit filed on September 20, 2007 in the U.S. District Court for the Central District of California against the major U.S. television broadcasting and cable companies alleges that the practice of offering consumers only prepackaged tiers of bundled channels and refusing to offer cable programming on an “à la carte” basis violates U.S. antitrust laws. The complaint alleges that each of the programming providers named as defendants (including NBC, Viacom, Disney, Fox and Time Warner) requires all of its broadcast and cable channels to be purchased as a package by cable and satellite television providers, in a practice known as “block booking” or “tying”. The cable and satellite providers in turn repackage these offerings and distribute them to consumers in bundled tiers of channels. The complaint alleges that the contracts between the programming providers and the cable and satellite companies constitute a combination which unreasonably restrains trade and commerce in the relevant product market, causing consumers to pay inflated prices for cable television and to pay for channels they do not want and do not watch. The complaint refers to a recent Federal Communications Commission study that concluded that many consumers would be better off under an “à la carte” model of television channel distribution. A recent article quotes plaintiffs’ lawyer Maxwell Blecher as stating that the toughest part of the litigation will be obtaining certification, given that most of the contracts between cable companies and consumers have arbitration clauses.

In Canada, cable companies likewise do not permit consumers to subscribe to channels on an “à la carte” basis, in accordance with Canadian Radio-television and Telecommunications Commission (CRTC) tiering and linkage rules which impose certain requirements on the packaging of channels. A report released by the CRTC earlier this month includes several recommendations to eliminate many of these rules and to permit increased scope for market forces and consumer demand in the packaging of cable services.

For a copy of the complaint, visit:
http://www.blechercollins.com/media/cable.pdf

For a copy of the CRTC report, visit:
http://www.crtc.gc.ca/eng/publications/reports/dunbarleblanc.htm

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US Copyright Action Launched Over Open Source Breach

The Software Freedom Law Center has filed a copyright action for infringement of the GNU General Public License (“GPL”).

The lawsuit involves a set of UNIX utilities called “BusyBox”, which is open source software licenced under the GPL. The GPL requires that redistributors of licenced software (in either original or modified form) ensure that every downstream recipient of the software has access to the corresponding source code.

The lawsuit was filed on behalf of BusyBox’s principal developers against Monsoon Multimedia, whose products apparently contain BusyBox, but which does not provide access to its source code.

The Software Freedom Law Center says that this is the first such lawsuit to enforce an open source licence. The case, if it goes forward, could therefore be precedent-setting.

For a copy of the complaint, visit:
http://www.softwarefreedom.org/news/2007/sep/20/busybox/complaint.pdf

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Chinese Woman Faces Legal Action From .eu Authorities

EURid, the registry organization responsible for the .eu domain, has frozen more than 10,000 domain names registered to a Chinese woman, Zheng Qingyin, and has filed a lawsuit requesting that the registration of the domain names be removed. In response, Qingyin has retaliated by bringing her own legal complaint against the Belgium-based organization, objecting to the suspension of the domain names.

EURid’s suit is based on alleged misrepresentation to the organization, as the organization does not have standing to argue cybersquatting. According to EURid’s legal adviser, Herman Sobrie, Qingyin, "is not really living where she says she is (London) so there is a question about the paperwork she has filed”. While EURid has the right to strip the ownership of the domain names, they have indicated a preference for the court to rule on this matter, which may take more than a year. By contrast, the action to release the domain names has been fast-tracked, and is expected to be heard next month.

This lawsuit by EURid follows last year’s suspension of more than 74,000 domain names and lawsuits against over 400 registrars for breach of contract relating to re-selling of domain names. The .eu domain was launched in December 2005 and has so far registered more than 2.5 million names.

For additional information, visit:
http://www.theregister.co.uk/2007/09/10/eu_domain_cybersquatting_allegation/

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Man Faces 20-Year Imprisonment for False Threats Over Domain Names

David Scali, a Las Vegas resident, faces a potential U.S. federal prison term of 20-years after agreeing to plead guilty to wire fraud. The FBI alleges that Mr. Scali impersonated an intellectual property lawyer and threatened to file $100,000 trade-mark infringement lawsuits against owners of typo-based Internet domain names unless they forfeited their domain name registrations within two days.

Typo-based domain names contain nomenclatures similar to popular websites and can, for example, result in profitable web traffic for their owners by virtue of people mistyping domain names, finding themselves on typo-based websites, and clicking on revenue generating ads found on such sites. In Mr. Scali’s situation, the wire fraud charge is based on a registrant who surrendered a typo-based domain name similar to the domain name, citysearch.com. While a plea agreement could substantially reduce Mr. Scali’s sentence from 20-years, his fate will ultimately rest with the sentencing judge.

For additional information, visit:
http://www.networkworld.com/community/node/19284

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New 'Open Access' Policy Introduced for Published Health Research

Through a recent ‘open access’ policy, the federal government’s Canadian Institutes of Health Research (CIHR) has set a new bar for health research. Starting in 2008, the CIHR will require all recipients of its research grants to ensure that their research publications are freely accessible through the publisher’s website or an online repository within six months of publication.

Although the new policy is said to be an important step towards the ‘open access movement’ in Canada, critics point out that the policy leaves room for improvement. A last-minute change to the policy now provides that publication in an online repository is conditional on publisher permission. Researchers may therefore avoid posting their work if the publisher denies them permission to do so. The Association of American Publishers has also claimed that open access is a threat to independent research and is a form of government censorship.

Despite the above criticisms, it is believed that CIHR’s new policy is likely to place new pressure on other federal major granting councils including the Natural Sciences and Engineering Research Council (NSERC) and the Social Sciences and Humanities Research Council (SSHRC).

For additional information, visit:
http://www.michaelgeist.ca/content/view/2223/159/

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Google Accused of Misleading Web Users About Sponsored Links

The Australian Competition and Consumer Commission (ACCC) has launched an action in Australia’s Federal Court against Google Inc., Google Ireland Ltd., Google Australia Pty Ltd. and a private classified magazine, “Trading Post”.

The ACCC alleges that Google’s failure to differentiate between paid advertisements and “organic” results generated by Google’s search engine misidentifies sponsored links and has resulted in web users being misled. Central to the ACCC’s accusation is an argument that web users mistakenly believe that Google’s search results are listed in order of relevance to the user’s query since there is no mention that sponsored hyperlinks may be embedded in such results.

The ACCC has pointed to a specific incident in 2005 when Google’s search engine listed two car dealerships from the New South Wales city of Newcastle as sponsored links but they actually lead to Trading Post’s website, which is a rival of the two car dealerships.

Analysts have theorized that the outcome of the Australian lawsuit will have a major impact on the global IT industry.

For additional information, visit:
http://tinyurl.com/2b3ra9

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Belgium Gaming Commission Files Complaint Against Online Political Gambling

Belgium’s Gaming Commission recently filed a complaint in the Brussels prosecutor’s office against Unibet.com, a Malta-based international gambling website, for allowing gamblers to bet on when the country will resolve its current political deadlock and form a new government. The commission is claiming that such betting is illegal under Belgium law. Unibet, on the other hand, claims to be doing nothing wrong under Belgian or European Union regulations. Unibet has also listed bets on elections in Poland and Norway, as well as which Democratic or Republican candidates would win the primaries in the United States.

For additional information, visit:
http://www.independent.com.mt/news.asp?newsitemid=57821

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