Justia Internet Law Opinion Summaries

Defendants, who operated what purported to be online pharmacies, were convicted on a 42-count indictment alleging crimes arising from a multi-national, internet-based, controlled-substance-distribution scheme. They have appealed multiple decisions of the trial court and appealed their conviction. The Third Circuit affirmed. Among other challenges, the court rejected arguments: that the money-laundering convictions impermissibly merge with underlying predicate felonies; that the district court should have suppressed evidence from untimely-sealed surveillance records; that the indictment, evidence, and jury instructions were insufficient to sustain a Continuing Criminal Enterprise conviction; and that the court erred in calculating sentences; the the alleged conduct, distribution of controlled substances via the internet, was not illegal at the time charged; that the money laundered was obtained by lawful means; and that certain convictions were misdemeanors, not felonies. View "United States v. Mullinix" on Justia Law

Plaintiff and defendant, both women, met in 2005 through a chatroom connected with a television series. Defendant, in Illinois, used her own name and aliases to communicate with plaintiff, in Los Angeles. One alias was that of a man, and a romantic relationship developed through the Internet, telephone, and mail. Defendant disguised her female identity using a voice-altering device. Plaintiff purchased airline tickets for a meeting in Denver, but her new “boyfriend” cancelled the plans. Plaintiff was informed that he had attempted suicide. In 2006 the two planned to live together in Colorado, but defendant subsequently informed plaintiff, using another alias, that the man had died of cancer. The deception continued for seven more months until plaintiff’s real friends confronted defendant and obtained a videotaped admission as to what had occurred. Plaintiff’s third amended complaint, alleging fraudulent misrepresentation and seeking damages for the cost of a therapist, lost earnings, and emotional distress, was dismissed. The appellate court affirmed, holding that claims made in the previous complaint, but not incorporated into the third amended complaint, had been abandoned. The supreme court affirmed, holding that a claim for fraudulent misrepresentation does not apply to a personal relationship with no commercial component. View "Bonhomme v. St. James" on Justia Law

Apple claimed that Samsung smartphones, the Galaxy S and the Infuse, and its Galaxy Tab 10.1 tablet infringed four Apple patents. Apple sought a preliminary injunction to block importation and U.S. sales. The district court denied the motion with respect to each device and all asserted patents. As to one patent, the court found that Apple failed to show likelihood of success on the merits because the patented design did not cover functional features and the design aspect was likely anticipated. As to others, the court held that Apple failed to show that it would likely suffer irreparable harm from continuing infringement while the case was pending, rejecting a claim of erosion of design distinctiveness. The court concluded that the absence of a nexus between the claimed design and the loss of market share, coupled with delay in seeking an injunction, undercut a claim of irreparable harm. With respect to a patent for the tablet computer, the court found that the design was not dictated by functionality and may have been obvious. The Federal Circuit affirmed with respect to three patents. With respect to the fourth, the court vacated, holding that the district court erred in its validity analysis. View "Apple, Inc. v. Samsung Elec. Co., Ltd." on Justia Law

EPIC filed a Freedom of Information Act (FOIA), 5 U.S.C. 552, request with the NSA seeking disclosure of any communications between NSA and Google regarding encryption and cyber security. EPIC's FOIA request arose out of a January 2010 cyber attack on Google that primarily targeted the Gmail accounts of human rights activists. The court held that any response to EPIC's FOIA request might reveal whether NSA did or did not consider a particular cyber security incident, or the security settings in particular commercial technologies, to be a potential threat to U.S. Government information systems. Any such threat assessment, as well as any ensuing action or inaction, implicated an undisputed NSA "function" and thus fell within the broad ambit of Section 6 of the National Security Agency Act, Pub. L. No 86-36, section 6(a), 73 Stat. 63. Accordingly, the court affirmed the judgment. View "Electronic Privacy Info. Center v. National Security Agency" on Justia Law

Leader, a software company, owns the 761 patent, which discloses a system that manages data that may be accessed and created by multiple users over a network. The patent improves upon conventional systems by associating data "with an individual, group of individuals, and topical content, and not simply with a folder, as in traditional systems." The system achieves this improvement by having users collaborate and communicate through boards that are accessible through an Internet browser and appear as a webpage. To facilitate those user-facing functions, the data management system employs metadata, tagged to data being created, to capture the association between the data and its context. As users create and change their contexts, the data (files) and applications automatically follow. Prior to filing the 761 application in 2003, Leader developed Leader2Leader.® Facebook claimed that the earlier product, publicly used and on sale prior to December 10, 2002 fell within the scope of the asserted claims of the 761 patent, rendering them invalid under 35 U.S.C. 102(b). The district court ruled in favor of Facebook. The Federal Circuit affirmed, finding the verdict supported by substantial evidence. View "Leader Tech., Inc. v. Facebook, Inc." on Justia Law

Defendant, a computer programmer employed by Goldman Sachs & Co., appealed his conviction for stealing and transferring proprietary computer source code of Goldman's high frequency trading system in violation of the National Stolen Property Act (NSPA), 18 U.S.C. 2314, and the Economic Espionage Act of 1996 (EEA), 18 U.S.C. 1832. Defendant argued, inter alia, that his conduct did not constitute an offense under either statute because: (1) the source code was not a "stolen" "good" within the meaning of the NSPA, and (2) the source code was not "related" to a product "produced for or placed in interstate or foreign commerce" within the meaning of the EEA. The court agreed and concluded that defendant's conduct did not constitute an offense under either the NSPA or the EEA, and that the indictment was therefore legally insufficient. Accordingly, the court reversed the judgment of the district court. View "United States v. Aleynikov" on Justia Law

This post-trial opinion determined the voting membership of GnB, LLC, a Delaware limited liability company. The parties disputed whether Firehouse Gallery, LLC, a Florida limited liability company, was a voting member of GnB. The parties also disputed whether GnB possessed an exclusive license to use the first-tier, generic domain name candles.com; held an option to purchase candles.com; and owned other assorted domain names relating to the candles business. The court held that Firehouse and plaintiff, who controlled GnB, each held a 50% voting membership interest; GnB owned the exclusive license and option to purchase candles.com and the other domain names; and plaintiff and defendant, the current principal of Firehouse, each breached their fiduciary duty of loyalty to GnB and must account for the profits and personal benefits they received. The court held that defendant was not otherwise liable to GnB or plaintiff. Because all of the litigants engaged in misconduct that could support fee-shifting, the doctrine of unclean hands applied with particular salience. Accordingly, the court held that all parties would bear their own fees and costs.View "Phillips v. Hove, et al." on Justia Law

The U.S. Court of Appeals for the Seventh Circuit, considering a suit by the city to collect taxes from a ticket reseller, requested a determination of whether municipalities may require electronic intermediaries to collect and remit amusement taxes on resold tickets. The Illinois Supreme Court held that state law preempts such a tax. The state has a long history of protecting consumers and has regulated auctioneers for more than 10 years and ticket resales for 20 years; it has regulated scalping in some form since 1923. The statutory scheme, and the debates which produced the Ticket Sale and Resale Act (720 ILCS 375/0.01) evince an intent to allow internet auction listing services to opt out of any obligation regarding local tax collection. The city overstepped its home rule authority. View "City of Chicago v. Stubhub" on Justia Law

Rosetta Stone appealed from an order granting summary judgment in favor of Google for Rosetta Stone's trademark infringement, contributory and vicarious trademark infringement, and trademark dilution claims. Rosetta Stone also appealed from an order dismissing its unjust enrichment claim under Virginia Law. Rosetta Stone contended that Google's policies concerning the use of trademarks as keywords and in ad text created not only a likelihood of confusion but also actual confusion, as well as misleading Internet users in purchasing counterfeit Rosetta Stone software. The court affirmed the district court's order with respect to the vicarious infringement claim and the unjust enrichment claims. The court vacated, however, the district court's order with respect to Rosetta Stone's direct infringement claim after addressing the likelihood of confusion and the functionality doctrine; contributory infringement claim where the evidence recited by the district court was sufficient to establish a question of fact as to whether Google continued to supply its services to known infringers; and dilution claim where the district court erred by omitting the question of good faith and collapsing the fair-use defense into one question. The court remanded the case for further proceedings. View "Rosetta Stone Ltd. v. Google, Inc." on Justia Law

The 435 patent relates to an automated financial accounting system that allows a user to connect to the computers of companies with which the user conducts business for transmission of financial information . Plaintiff asserted that Quicken and QuickBooks products infringed claims that contain an "access means" limitation. The parties agree that this is a means-plus-function limitation performed by a processor. As such, the specification of the 435 patent must contain an algorithm to perform the function associated with the "access mean"” limitation, or the limitation is indefinite. The district court entered summary judgment of invalidity. The Federal Circuit affirmed, holding that the "access means" limitation is indefinite. View "Noah Systems, Inc. v. Intuit, Inc." on Justia Law