e-Commerce Docket Sheet

Sale of Data Not Third-Party License or Sublicense

A licensor's use of a licensed technology to internally generate data that is then provided to third parties does not constitute an unauthorized license or sublicense of the technology. Digital Envoy, Inc. v. Google, Inc., 370 F. Supp. 2d 1025 (N.D. Cal. 2005). The court noted that the participants in the Google AdSense program were “provided only with the results of Google's internal use of Digital's geo-targeting method” and were not granted the right to access or use Digital's proprietary data. The court ruled that Digital had failed to show undisputed facts supporting the conclusion that Google had licensed or sublicensed Digital's technology in violation of the parties' agreement, so Digital was not entitled to summary judgment on that issue.

A cosmetic company's revocation of its prior oral approval of a distributor's Web site and usage of its trademarks did not constitute tortious interference with the distributor's contracts with Web site subscribers who were also distributors of the company's products. Via the Web Designs, L.L.C. v. BeautiControl Cosmetics, Inc., No. 04-1247 (6th Cir. Sep. 7, 2005) (unpublished). The court noted that there was no binding agreement by which the company granted the distributor the right to create and market a Web site using its trademark, or any agreement limiting the company's right to create and market a competing Web site. The court ruled that the company's letters to the subscribers who were also its distributors directing them not to use the plaintiff's Web site, constituted valid contractual control over its distributors.

A plaintiff's 5-year delay in filing suit challenging a junior user's registration of an allegedly infringing domain name raises a triable issue of fact with respect to the doctrine of “progressive encroachment” and whether it overcomes a defense of laches. Ameripay LLC v. Ameripay Payroll, Ltd, 2005 U.S. Dist. LEXIS 20453 (N.D. Ill. Sep. 16, 2005). In response to defendant's motion for summary judgment based on the defense of laches, the court ruled that aggressive Internet marketing by the junior user via an interactive Web site that more directly competed with the plaintiff raised a factual question concerning the applicability of the doctrine of “progressive encroachment.” Under that doctrine, the court explained, a trademark owner is entitled to tolerate minor infringements without losing the right to take enforcement action when a junior user's activity threatens more serious harm. The court concluded that a reasonable jury could find that the plaintiff was justified in delaying legal action until the junior user's Internet marketing placed it more squarely in competition with the plaintiff.

A car retailer whose online database was accessed without authorization by a competitor cannot obtain relief under the federal Computer Fraud and Abuse Act (CFAA) for lost profits allegedly resulting from the “unfair competitive edge” gained by the competitor and the retailer's “wasted investment” in its database. Civic Center Motors, Ltd., v. Mason Street Import Cars, Ltd., 2005 U.S. Dist. LEXIS 19941 (S.D.N.Y. Sep. 6, 2005). The court dismissed the plaintiff's complaint, concluding that losses under the CFAA are compensable only when they result from damage to or inoperability of a computer system.

The use of an automatic dialing system to send messages to cellular telephones in the Short Messaging Service (SMS) format constitutes a “call” that violates the Telephone Consumer Protection Act (TCPA). Joffe v. Acacia Mortgage Corp., 2005 Ariz. App. LEXIS 124 (Ariz. Ct. App., Sep. 20, 2005). The appeals court ruled that the prohibition in the TCPA against the use of automatic dialing systems to make “any call” to a telephone number assigned to a cellular telephone service was not limited to two-way real-time voice intercommunications. The court noted that its interpretation of the term “call” was consistent with other provisions of the TCPA that prohibit making a call to a cellular or residential telephone number using an artificial or prerecorded voice, a form of call that “has no potential for a real time voice intercommunication.”

In an enforcement action brought by the Federal Trade Commission (FTC) against various defendants engaged in distributing “spyware,” a federal district court may exercise personal jurisdiction over a party that claims he is no longer engaged in the business sought to be enjoined. Federal Trade Commission v. Seismic Entertainment Productions, Inc., 2005 U.S. Dist. LEXIS 21899 (D. N.H. Sep. 22, 2005). The court ruled that assessing the validity of personal jurisdiction in an FTC enforcement action requires only whether there is a “likelihood” that jurisdictional facts exist. The court found that the FTC had provided a sufficient basis to support its reasonable belief that, absent an injunction, the defendant would again pursue activities in violation of the Federal Trade Commission Act. The court also noted that personal jurisdiction under the FTC Act extends to defendants who have sufficient minimum contacts with the United States, and is not limited to those who have minimum contacts with the forum state.

Sale of Data Not Third-Party License or Sublicense

A licensor's use of a licensed technology to internally generate data that is then provided to third parties does not constitute an unauthorized license or sublicense of the technology. Digital Envoy, Inc. v. Google, Inc. , 370 F. Supp. 2d 1025 (N.D. Cal. 2005). The court noted that the participants in the Google AdSense program were “provided only with the results of Google's internal use of Digital's geo-targeting method” and were not granted the right to access or use Digital's proprietary data. The court ruled that Digital had failed to show undisputed facts supporting the conclusion that Google had licensed or sublicensed Digital's technology in violation of the parties' agreement, so Digital was not entitled to summary judgment on that issue.

A cosmetic company's revocation of its prior oral approval of a distributor's Web site and usage of its trademarks did not constitute tortious interference with the distributor's contracts with Web site subscribers who were also distributors of the company's products. Via the Web Designs, L.L.C. v. BeautiControl Cosmetics, Inc., No. 04-1247 (6th Cir. Sep. 7, 2005) (unpublished). The court noted that there was no binding agreement by which the company granted the distributor the right to create and market a Web site using its trademark, or any agreement limiting the company's right to create and market a competing Web site. The court ruled that the company's letters to the subscribers who were also its distributors directing them not to use the plaintiff's Web site, constituted valid contractual control over its distributors.

A plaintiff's 5-year delay in filing suit challenging a junior user's registration of an allegedly infringing domain name raises a triable issue of fact with respect to the doctrine of “progressive encroachment” and whether it overcomes a defense of laches. Ameripay LLC v. Ameripay Payroll, Ltd, 2005 U.S. Dist. LEXIS 20453 (N.D. Ill. Sep. 16, 2005). In response to defendant's motion for summary judgment based on the defense of laches, the court ruled that aggressive Internet marketing by the junior user via an interactive Web site that more directly competed with the plaintiff raised a factual question concerning the applicability of the doctrine of “progressive encroachment.” Under that doctrine, the court explained, a trademark owner is entitled to tolerate minor infringements without losing the right to take enforcement action when a junior user's activity threatens more serious harm. The court concluded that a reasonable jury could find that the plaintiff was justified in delaying legal action until the junior user's Internet marketing placed it more squarely in competition with the plaintiff.

A car retailer whose online database was accessed without authorization by a competitor cannot obtain relief under the federal Computer Fraud and Abuse Act (CFAA) for lost profits allegedly resulting from the “unfair competitive edge” gained by the competitor and the retailer's “wasted investment” in its database. Civic Center Motors, Ltd., v. Mason Street Import Cars, Ltd., 2005 U.S. Dist. LEXIS 19941 (S.D.N.Y. Sep. 6, 2005). The court dismissed the plaintiff's complaint, concluding that losses under the CFAA are compensable only when they result from damage to or inoperability of a computer system.

The use of an automatic dialing system to send messages to cellular telephones in the Short Messaging Service (SMS) format constitutes a “call” that violates the Telephone Consumer Protection Act (TCPA). Joffe v. Acacia Mortgage Corp., 2005 Ariz. App. LEXIS 124 (Ariz. Ct. App., Sep. 20, 2005). The appeals court ruled that the prohibition in the TCPA against the use of automatic dialing systems to make “any call” to a telephone number assigned to a cellular telephone service was not limited to two-way real-time voice intercommunications. The court noted that its interpretation of the term “call” was consistent with other provisions of the TCPA that prohibit making a call to a cellular or residential telephone number using an artificial or prerecorded voice, a form of call that “has no potential for a real time voice intercommunication.”

In an enforcement action brought by the Federal Trade Commission (FTC) against various defendants engaged in distributing “spyware,” a federal district court may exercise personal jurisdiction over a party that claims he is no longer engaged in the business sought to be enjoined. Federal Trade Commission v. Seismic Entertainment Productions, Inc., 2005 U.S. Dist. LEXIS 21899 (D. N.H. Sep. 22, 2005). The court ruled that assessing the validity of personal jurisdiction in an FTC enforcement action requires only whether there is a “likelihood” that jurisdictional facts exist. The court found that the FTC had provided a sufficient basis to support its reasonable belief that, absent an injunction, the defendant would again pursue activities in violation of the Federal Trade Commission Act. The court also noted that personal jurisdiction under the FTC Act extends to defendants who have sufficient minimum contacts with the United States, and is not limited to those who have minimum contacts with the forum state.