Yelp Goes on Offense in Suit Against Law Firm

After some recent defensive victories that tested the limits of its immunity under the Communications Decency Act, the popular review site Yelp has gone on offense, suing a law firm for using its employees to post fake reviews on Yelp’s sites. 

The lawsuit alleges that Yelp checked court records to confirm that the posters were not clients of McMillan Law Group as they claimed.  Moreover, Yelp alleges that the posts were created from an IP address linked to the law firm and that, in addition to posting its own fake reviews, the firm “participated in a circle of San Diego lawyers who trade positive reviews.” 

One might then ask why Yelp targeted this particular law firm.  The firm suspects that the suit was in retaliation for its own recent victory in a small claims lawsuit against Yelp, which reportedly alleged that Yelp failed to deliver the results it promised when the firm agreed to purchase advertising.   The small claims court’s ruling was later vacated (days after Yelp sued the law firm) because the matter should have been arbitrated. 

Regardless of its motives, and even assuming its Terms of Service create an enforceable contract, or that Yelp has standing to allege unfair competition claims, Yelp may face an uphill battle establishing that it suffered damages as a result of the law firm’s alleged conduct. 

Although it is uncertain whether Yelp will continue this practice of suing posters suspected of abusing their account privileges, posters of false Yelp reviews also risk being sued for defamation.  A recent appellate court opinion from California in the case Sanders v. Walsh affirmed a judgment in favor of Cheryl Sanders, daughter of Barbara Sanders, a cancer patient who had returned a wig she bought from Walsh’s company, Wiggin Out Salons.  Continue reading

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Appellate Court Allows Google Street View Class Action to Proceed

A federal appellate court declined to dismiss a class action lawsuit against Google alleging that it violated the Federal Wiretap Act and similar state laws by collecting unencrypted Wi-Fi data while gathering images for Street View.

Between 2007 and 2010, Google’s Street View cars used sensors to record Wi-Fi networks’ activity in order to enhance its “location-based” services, but also picked up personal data transmitted over unencrypted networks, including emails and passwords.  Google later issued an apology.

The appellate court in Joffe v. Google, Inc., however, agreed with the lower court that Google’s defenses applied to radio communications – meaning auditory broadcasts – and not to data transmitted over a Wi-Fi network.  Further, the intercepted data was not “readily accessible to the general public” as required to be exempt under the Act.

Although class members might have trouble quantifying damages suffered as a result of Google’s Street View-ing, the Wiretap Act allows for statutory damages, which could stack up considering the number of people affected.  The appellate court’s opinion – and the settlement that it may bring about – is likely to embolden potential plaintiffs to pursue claims based on novel privacy issues that do not fit neatly into boxes created by pre-Internet laws.

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State AGs Seek to Limit Online Immunity

Citing concerns about sex trafficking, Attorneys General from 47 states (all minus Virginia, Wisconsin, and Connecticut) have signed a letter asking Congress to amend Section 230 of the Communications Decency Act, which immunizes websites from liability for content posted by third parties.  Attempts to hold websites like craigslist liable for hosting solicitations for prostitution have previously failed under Section 230 (although craigslist eventually voluntarily took down its Adult Services section).

While Section 230 currently exempts certain federal laws from its immunity, the proposed amendment would provide that Section 230 “shall not be construed to impair the enforcement of . . . any . .  . Federal or State criminal statute.”   Since service providers cannot customize their content to each state in which someone might access the Internet, this could essentially make the laws of the most restrictive state the law of the land.  This is not to mention the sheer number of state laws out there.

Moreover, the proposed amendment is not limited to state laws regarding sex trafficking.  Many states, for example, have laws on the books criminalizing libel (although they are rarely enforced).  Anyone who has read an anonymous reader comment thread can imagine the implications if news outlets were liable for every defamatory comment posted by a third party.  Contrary to current law, review sites like Yelp could be responsible for verifying the accuracy of reviewers’ critical statements.       Continue reading

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Feds Struggle to Define Journalism

The Electronic Frontier Foundation (EFF) notes that the Department of Justice’s recent guidelines for investigations involving the news media may signal a trend towards limiting protections afforded to journalists to exclude many bloggers.

The DOJ’s Domestic Investigation and Operations Guide limits the instances in which the Department will issue search warrants or subpoenas to journalists.  The guidelines, however, exclude those who merely “post information or opinion on the Internet in blogs, chat rooms or social networking sites, such as YouTube, Facebook, or MySpace” unless they otherwise fit the definition of “news media.”

Although MySpace users are honored to even get a mention, other social media users have expressed concern.  The definition goes on to exclude “persons and entities that simply make information available” as opposed to one who “gathers information of potential interest to a segment of the general public, uses editorial skills to turn raw materials into a distinct work, and distributes that work to an audience, as a journalism professional.”  It further notes that “businesses, law firms, and trade associations offer newsletters or have websites; these are not considered news media.”

The EFF compares the guidelines with recent federal shield bills that limit coverage to persons “regularly” engaging in journalism for “financial gain and livelihood.”  Continue reading

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Two Setbacks for Online Review Victims

Faced with a unjustifiably hostile online review, the first impulse of many small businesses is to sue either the author or the website for defamation or some similar tort.  Two recent court decisions, however, demonstrate just how difficult it may be to recover against either class of defendant.

In Brompton Building, LLC v. Yelp!, Inc., an Illinois property manager subpoenaed Yelp to determine the identity of the author of a review under the name “Diana Z.”  Diana’s review claimed, among other things, that the manager was not responsive to maintenance requests and “illegally charge[s] tenants late fees for their rent” and concluded with the observation that, after her interactions with the landlord, “contracting herpes doesn’t seem as horrible.”    Continue reading

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Instagram Reverses Revised Privacy Policy; Court Sides With Twitpic Photog

The Chicago Sun-Times explains Instagram’s recent revisions to its privacy policy, which the popular photo-sharing service scaled back after last month’s changes led to user backlash, prominently featuring Kim Kardashian and her loyal followers.  After Instagram was acquired by Facebook, it changed its policy to allow Instagram or its advertisers to display users’ content and information without consent or compensation.  In the wake of complaints, the current policy reads, in relevant part:

We may share User Content and your information (including but not limited to, information from cookies, log files, device identifiers, location data, and usage data) with businesses that are legally part of the same group of companies that Instagram is part of, or that become part of that group (“Affiliates”). Affiliates may use this information to help provide, understand, and improve the Service (including by providing analytics) and Affiliates’ own services (including by providing you with better and more relevant experiences). But these Affiliates will honor the choices you make about who can see your photos. Continue reading

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Court Orders Customer to Stop Yelping

A Virginia judge has issued an injunction ordering a woman to stop posting critical reviews on websites Yelp and Angie’s List regarding a contractor’s work on her home.

The customer, Jane Perez, allegedly failed to pay the company, Dietz Development, LLC, for the work it performed and demanded that the company perform additional work for free.  When the company declined to do so, she posted that they had damaged her house, stolen her jewelry, performed shoddy work, and falsified her bills, among other accusations, and stated that she had prevailed in defending a lawsuit by the company.  The court reportedly required her to delete posts regarding the jewelry theft and lawsuit and prohibited her from repeating them.

The plaintiffs argued that their odds of prevailing in their defamation suit were strong, and that they would be irreparably harmed without the injunction.  In non-speech cases, such findings might suffice to justify an injunction against conduct but the First Amendment bars prohibitions on future speech – or “prior restraints” – absent extraordinary circumstances, e.g., imminent threats to national security (if leaking of the Pentagon Papers did not justify a court-ordered prior restraint it is difficult to argue that a Yelp review would qualify).  The accepted remedy is to sue for monetary damages after the fact rather than employ courts as censors.   Continue reading

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Texting’s 20th Birthday: Time to Update your Company’s Policies?

When Canadian engineer Neil Papworth sent the first text message 20 years ago, he had no way of knowing that texting would evolve into one of the world’s most prominent means of communication.  He also had no way of knowing that it would become a major cause of automobile accidents.  FVLD Members Damon Dunn and Jon Vegosen have written extensively for Bloomberg Law Reports and other publications about companies’ liability risks when their employees text and drive.  State legislators continue to propose bills to enact or strengthen legislation to punish texting while driving.

Employers should consider celebrating the birthday of the text message by revisiting their policies and practices on texting while driving.

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NLRB: Nice Companies Finish Last

The National Labor Relations Board (NLRB) has decided that a policy encouraging employees of an Illinois BMW dealership to be courteous to one another violated the National Labor Relations Act (NLRA).  The NLRA prohibits punishing employees for discussing working conditions and, according to the NLRB, the policy did not make clear enough that it did not cover such discussions.

An employee of Karl Knauz Motors who was fired for a Facebook post challenged the handbook rule, which stated that “Courtesy is the responsibility of every employee.  Everyone is expected to be courteous, polite, and friendly to our customers, vendors and suppliers, as well as to their fellow employees.  No one should be disrespectful or use profanity or any other language which injures the image or reputation of the dealership.”

The NLRB’s primary objection was to the last sentence prohibiting language that would injure the dealership’s reputation.

A reasonable employee who wishes to avoid discipline or discharge will surely pay careful attention and exercise caution when he is told what lines he may not safely cross at work . . . Reasonable employees would believe that even “courteous, polite, and friendly” expressions of disagreement with the Respondent’s employment practices or terms and conditions of employment risk being deemed “disrespectful” or damaging to the Respondent’s image or reputation.

Continue reading

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Plug or Perish

For FVLD’s September Legal Update, Jon Vegosen writes about the NLRB’s controversial stance on some common social media policies.  As Jon explains, these developments raise concerns for employers.

For example, many employers have trade secrets and other confidential and proprietary information. Often such information is restricted to a small group of employees, and for good reason. Yet, the NLRB has flagged as unlawful a social media policy prohibiting the sharing of confidential or proprietary information with coworkers unless they need the information to do their jobs. Likewise, doctors and lawyers owe confidentiality obligations to their patients and clients. Moreover, employers have confidentiality obligations concerning their employees when it comes to laws like the Americans with Disabilities Act. Nevertheless, these important obligations are threatened by the breadth of the NLRB’s pronouncements. Federal law gives companies rights to limit the use of logos and trademarks by third parties. Yet, the NLRB would deny a company this right when a company employee uses his employer’s logo or trademark for “non-commercial use” in connection with protected activities.

Click here to read the Update.

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Lawsuit: Smartphone and Memory Card Seized from Man Recording Police

A Washington D.C. man has sued two police officers for seizing his smartphone with which he photographed a police officer engaging in allegedly “aggressive conduct toward members of the public” after another officer hit a man on a motorbike with a squad car.  His smartphone eventually was returned, but was allegedly missing its memory card.

“Citizen journalism” is on the rise due to easy access to recording equipment afforded by smartphones combined with the ability to instantly broadcast observations via social media.  Courts have recognized this trend and protected individuals’ rights to record matters of public interests like law enforcement officers in action.  Still, those attending protests or other events where they are likely to record police officers should take precautions.  Particularly during mass arrests, officers may not be able to separate bystanders and journalists from rioters.  Some helpful measures include backing up the phone’s memory and labeling phones and memory cards with the owner’s name and contact information and, if applicable, an indication that the owner is a member of the media.   Continue reading

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Online Discussion Sites as Public Forums

Two recent cases deal with whether online discussion sites constitute “public forums” qualifying for additional speech protections.

In Backlund v. Stone, Stone, a website host, first allegedly posted lewd pictures of a teenage girl who he falsely claimed was Backlund.  Later, he tweeted a threat to Backlund (by then an adult) to post actual nude photos of her if she continued talking to a friend of his.  She sued him, and his defense that the lawsuit was a Strategic Lawsuit Against Public Participation (“SLAPP”) failed because California’s anti-SLAPP lawsuit “does not apply to indisputably illegal communications” like child pornography.

He then filed a cross-complaint for defamation based on comments Backlund made to an online magazine about the experience.  Continue reading

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New Illinois Laws Affect Online Privacy

Recently enacted Illinois laws are intended to protect the online privacy of both public and private employees in the state.

The Judicial Privacy Improvement Act (JPIA) is a legislative response to the 2005 shootings of relatives of a federal judge based in Illinois.  Authorities believe that the shooter was seeking revenge after the judge dismissed a lawsuit.   The statute allows judges to request that their personal information – defined as home addresses, telephone numbers, personal email addresses, Social Security numbers, federal tax identification numbers, checking and savings account numbers, credit card numbers, marital status and the identification of minor children – be removed from websites and public documents.   Those who fail to comply with such requests are subject to civil and criminal penalties.  The statute also exempts such information from disclosure under the Freedom of Information Act.

Statutes restricting the publication of information regarding public figures always raise First Amendment concerns. Continue reading

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Music Publisher Seeks Removal of Campaign Ads

Music publisher BMG Rights Management has reportedly filed a notice under the Digital Millennium Copyright Act (DMCA) leading YouTube to remove video of a Mitt Romney campaign ad featuring President Obama’s rendition of Al Green’s “Let’s Stay Together”.  BMG is also seeking removal of other clips of Obama singing the 1972 hit.

The Romney campaign has reportedly re-posted the ad to YouTube competitor Vimeo.

The ad features Obama’s singing in the background while displaying headlines from articles alleging that he “stayed together” with campaign contributors by rewarding them once in office.

As Ars Technica notes, the ad’s use of the song is likely a “fair use” exempt from liability under the Copyright Act.  The political ad uses only the small part of the tune that Obama famously sang during a speech earlier this year and is highly unlikely to affect the market for Green’s original recording.   Continue reading

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IL High Court Shoots Down “Deadwood” Fraud Claim Based on Chat Room Romance

A woman who frequented a chat room devoted to the HBO show Deadwood claimed she found herself caught up in her own fictional western drama when another female fan drew her into a long distance relationship while posing as a man named Jesse James and a cast of several other fake acquaintances of Jesse who corroborated “his” story.  The Illinois Supreme Court, however, recently held that the woman could not recover damages suffered from the alleged “fraud”.

The ordeal allegedly led to significant distress, particularly when a “friend” of Jesse told the woman, Paula Bonhomme, that Jesse had attempted suicide and then that Jesse had died of cancer, halting her plans to move in with Jesse in his supposed Colorado home.  After that, Bonhomme visited Jesse’s friend (actually Jesse under her real name, Janna) in Colorado to see Jesse’s favorite sites, followed by a return visit to Bonhomme’s home.

Expenses allegedly incurred by Bonhomme include thousands of dollars in therapist bills, gifts for Jesse and friends, and expenses related to making her home handicap-accessible for Janna’s visit.  The relationship and particularly Jesse’s tragic death – complete with a final love letter to Bonhomme – also led to Bonhomme’s severe depression.

As we previously discussed, the Illinois appellate court upheld Bonhomme’s claim against “Calamity” Janna for fraudulent misrepresentation. The appellate judges debated whether reliance on a chat room user’s representations regarding her identity can be justifiable (justifiable reliance is a key element of the tort) with the majority holding that Bonhomme was entitled to rely on Jesse’s elaborate story.

The reprieve was short lived, however, because the Supreme Court sent the case on to the last roundup. Continue reading

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