Graydon Head

Blog: Jack "Out of the Box"

Welcome to Jack "Out of the Box." This is a spin-off of the Firm's InfoLaw Newsletter, much like "CSI: Miami" is a spin-off from "CSI." Except without all the corpses. I plan to update the blog at least weekly. Really. It's not like when I used to promise my mom to clean my room once a week. I'm more mature now. And of course, the InfoLaw Newsletter will continue every two weeks. The blog will feature shorter pieces, and ideally, reader feedback. Should be fun. Oh yeah, and informative.
  • CheeriOMG

    Apr 18, 2014

    Remember all the good buzz that General Mills got for those awesome Cheerios commercials featuring the interracial family?  That may soon all be forgotten with the release of news that the company is quietly inserting forced arbitration provisions in a number of interactions with its customers. Take a look at the link, but very briefly, General Mills is inserting language on its Web site to the effect that by downloading coupons, “joining” the company on online communities like Facebook, or entering a company-sponsored sweepstakes or contest forfeit their right to sue the company, and instead, “agree” to arbitrate any disputes. 

    I put the agree in quotation marks, because the average consumer is unlikely to see the term. It resides in the Legal Terms section of the Web site. And it is pretty one sided. The terms stipulate that “all disputes or claims arising out of this Agreement or your purchase or use of any General Mills product or service for personal or household use” must be arbitrated or resolved in a small claims court. So no jury trials or class actions allowed. The arbitration is required to be confidential, which means no disclosing the “existence” or “result” of the arbitration.

    And you may ask why is General Mills taking this heavy handed approach? Probably because it can. The U.S. Supreme Court decided a case a few years back that said companies could enforce contractual provisions that required its customers to waive their rights to proceed in a class action. That case – in which AT&T enforced a term in its contract with a mobile phone customer -- arose in a more traditional contract setting.  We’ll see if General Mills’ efforts to expand that case into the social media realm succeeds.

    The question will likely come down to how effectively General Mills conveyed its new terms. If consumers are able to show that they reasonably missed this change, it’s unlikely a court would uphold the provision. On the other hand, if General Mills can show that it alerted consumers to the new terms, courts may very well enforce them.

    Of course, that analysis doesn’t take into account the customer relations issue. But I suppose General Mills decided the legal savings will make up for any public relations hit it takes. I’m curious if my readers agree. Let me know.

    And many thanks to my friend Nick Vehr for the heads up on this one.


    Go comment!
  • Good F#%*ing News for Twibel Defendant

    Apr 17, 2014
    A recent decision from a federal court in Massachusetts is the latest word on “twibel.” Twibel is made up word to describe “Twitter libel.” It is similar, I guess the term “framily” which is the subject of those incredibly bizarre Sprint commercials that seemed to run every 5 minutes during the NCAA tournament. I have a hard time fathoming how a commercial like that makes it to the airwaves. I mean some creative type at an ad agency had to conceive it, then some supervisor there had to green light it, and then I assume at least a few folks at Sprint had to approve it. I can’t believe someone in that chain didn’t say “this is the dumbest piece of crap I’ve ever seen.” Did I mention I hate it?

    But I digress. Mara Feld apparently arranged for her horse “Munition” to be shipped to a horse farm. Somehow, Munition wound up being sold at a horse auction and possibly slaughtered in Canada. These events became the subject of conversation on social media, culminating in a tweet from a woman named Crystal Conway that said “Mara Feld aka Gina Holt – you are f***ing crazy” (except it was the unedited version). Crazy or not, Ms. Feld filed a libel suit. She claimed that the tweet defamed her because it constituted “an unexplained indictment of [her] sanity.”

    But Ms. Feld’s case met a fate similar to Munition’s – the court dismissed it at the earliest possible stage. The court ruled Ms. Feld could not establish libel because, in the context of the social media conversation, it was clear Conway’s comment was not a serious diagnosis of mental illness. It was, what we media lawyers like to call, hyperbole. In other words, the statement (and especially this one when taken in context) is so over the top it’s not intended that anyone take it literally. The lesson here? Sometimes in libel the best advice is “go big or go home.”

    And the case points once more to the fact that new technology doesn’t necessarily mean new law. The notion that hyperbolic speech isn’t libel was around when a tweet was nothing more than a sound a bird made. In other words, the fact that Conway made her statement in less than 140 characters really isn’t all that relevant here. She’d have probably gotten the same result if she’d written it the sky.  
    Go comment!
  • It's All In The Wrists

    Apr 14, 2014

    A federal court in New York recently denied a summary judgment motion in a workplace injury case that once more highlights how social media can play a role in all sorts of litigation. Kerwin Vasquez worked for the Metro-North Commuter Railroad. He apparently injured his wrist while on the job. Upon his return to work, he claims his supervisor negligently directed him to perform tasks that made his wrist injury worse.

    And that may be the case. But Vasquez didn’t help his cause much when he posted pictures on Facebook during the same time period showing him weightlifting and using his wrists to support himself. Metro-North argued this evidence required the court to award it summary judgment on Vasquez’s claims. 

    The court denied the motion, apparently adopting Vasquez’s argument that even though he was able to engage in the activities shown on Facebook, he was still in pain. And I suppose his willingness to adopt a “no pain no gain” attitude in the gym doesn’t give his employer the right to make him do activities that worsen his condition at work. Still.

    The judge’s ruling means only that a jury will hear Vazquez’s claim. And I bet those Facebook photos will be a big part of Metro-North’s evidence. And Kerwin may want to familiarize himself with Facebook’s privacy settings.

    Go comment!
  • Who's The Jerk Now?

    Apr 10, 2014

    Just to be clear, I am not talking about the classic 1979 Steve Martin film.  And as an aside, if you want to check out another side of Steve Martin’s talent, I cannot recommend this CD enough. He is a fantastic banjo player.

    But back to my blog. The Jerk to which I am referring is a Web site, that is now the subject of a Federal Trade Commission administrative complaint. “Jerk” operated under any number of names –, and among others. Interesting business model. It held itself out as a site where folks could post a photo of themselves (or someone else) and ask visitors to vote on whether or not the photo subject was indeed a jerk. Voters could also post comments such as “OMG I hate this kid he’s such a loser.” I’m not kidding. This was evidently a money making operation.

    According to the FTC, between 2009 and 2013, the site contained between 73.4 and 81.6 million unique consumer profiles. So a lot of people took the time to nominate potential jerks. Or maybe not. And that’s part of the reason for the complaint. It seems that the Jerk operators obtained photos and profile information directly from Facebook (in violation of Facebook’s terms and conditions) and in fact did not receive them from actual users. On top of that, according to the FTC, the Jerk operators ignored and/or bypassed privacy settings and posted in some cases intimate photos which were supposed to be protected by Facebook privacy settings.

    And to top it off, Jerk offered a $30 “membership” that it implied would give profile subjects a means to remove the content. And as far as the FTC is concerned, the key verb in the previous sentence is “implied.” Judging from the complaint, a lot of “members” never got removed. And this all constitutes “deceptive practices” which is prohibited by Section 5 of the Federal Trade Commission Act. 

    The FTC just recently filed the complaint, and the hearing isn’t until January, 2015.  But included in the complaint is a proposed order to resolve the matter. That order includes a permanent injunction limiting Jerk’s use of customer data, and FTC monitoring for 10 years. 

    The lesson? Don’t jerk the FTC around. Obviously.

    Go comment!
  • "Pinned" - New Meaning, New Exposure

    Apr 09, 2014

    There was a time, back around the Kennedy administration, when the term “pinned” meant that a guy and a gal were “going steady.” For additional information, see this sequence from the film version of “Bye Bye Birdie.” So the guy would attach his pin (probably from a fraternity) on his best girl’s sweater, and next thing you knew, they had an exclusive dating relationship. Not exactly the same thing as “hooking up.”

    But these are different times. Now, “pin” is what a Pinterest user does. So a user “pins” content to the Pinterest site, which means the public can browse that content, which often consists of photos. And that is on my mind today because of a recent FTC letter ruling finding that the Cole Haan shoe company’s “Wandering Sole” contest on Pinterest may have violated the Federal Trade Commission’s guidelines on endorsements.

    Here’s how the FTC described the contest:

    The contest rules instructed contestants to create Pinterest boards titled "Wandering Sole." The contest rules further required that a board include five shoe images from Cole Haan's Wandering Sole Pinterest Board as well as five images of the contestants' "favorite places to wander." Finally, contestants were instructed to use "#WanderingSole" in each pin description. Cole Haan promised to award a $1,000 shopping spree to the contestant with the most creative entry.

    Sounds innocent enough. So why does the FTC care? Because the aforementioned (I like to throw in a lawyer word occasionally) endorsement guidelines require disclosure of a material connection between a marketer and an endorser when their relationship is not otherwise apparent from the context of the communication that contains the endorsement.” The highlighted words are courtesy of the FTC. And all it means is that if I’m posting content touting a product and being compensated for it, I need to let readers know that fact. [Editor’s note – I have never endorsed a product on this blog for compensation. But I’m open to offers. Call me.]

    In the FTC’s view, the prospect of being compensated is apparently sufficient to trigger the need to disclose the deal. Keep that in mind if you are planning a contest on social media. And that is indeed the “story, morning glory.”

    Go comment!
  • Lanham Act Tent Gets A Little Bigger

    Apr 02, 2014

    The Supreme Court just last week issued a decision that will allow more businesses to sue under the federal Lanham Act. And while that is good news for lawyers, it raises some interesting questions about just how far the decision will stretch. 

    The Lanham Act is a federal statute that prohibits false or misleading advertising. In that respect, it’s easy to see how a direct competitor would have a claim. Imagine a commercial for a print cartridge made by Company A that implies to customers that only Company A can refill that cartridge. Assuming that’s false, Company B – a direct competitor – clearly has a Lanham Act claim. 

    But what about Company C, which makes technology for actually executing the refill for Company B?  Does Company C have a claim? It’s not a direct competitor, but isn’t it affected just as much by Company A’s misleading advertising?

    That was nearly the precise question for the Supreme Court. The plaintiff in the case was a company called Static Control. The defendant was a company called Lexmark. According to the Court, Lexmark sells the only style of toner cartridges that work with Lexmark laser printers. But given American ingenuity, some after-market players were able to acquire and refurbish used Lexmark cartridges to sell in competition with Lexmark’s own new and refurbished ones.

    Using its own ingenuity, Lexmark developed a “Prebate” pro¬≠gram. Under that program, Lexmark customers got a discount on new cartridges if they agreed to return empty cartridges to Lexmark. Lexmark inserted a microchip in each Prebate cartridge that disabled the empty cartridge unless Lexmark re¬≠placed the chip.

    Static Control, developed a microchip that mimicked the Lexmark chip (this is starting to sound like the arms race) which would allow the after-market sellers back in the game. When Lexmark sued Static for copyright infringement, Static countersued on a Lanham Act claim, alleging that Lexmark deceived its Prebate customers by making them believe they were legally bound to allow only Lexmark to refill the cartridges. The trial court dismissed Static’s Lanham Act claim, on the grounds that it was not a direct competitor and therefore couldn’t bring a Lanham Act claim. The Sixth Circuit Court of Appeals, however, reversed. The Supreme Court accepted the appeal because the various federal appellate courts were split on the issue.

    In a decision authored by Justice Scalia, the Supreme Court ruled that the “direct competitor” analysis was too confining. In its view, any entity able to allege damage to reputation or sales resulting from the Lanham Act violation can bring a claim. In the Lexmark case, there was no mention of Static in any of the Lexmark advertising. So it’s not like Lexmark disparaged Static, or made a false comparison. But that ultimately didn’t matter. Lexmark allegedly made false representations that reduced Static’s sales. And that’s apparently enough. 

    The Lexmark decision certainly means more Lanham Act plaintiffs (and conversely more Lanham Act defendants – I told you this would make lawyers happy) but it’s hard to say exactly how far this plays out. It seems to me that the affected supplier has to be somewhat captive. That is, if Walmart makes a misleading claim about Kroger, that means that less people will go to Kroger’s and buy Coke. And so, in that respect, Coke a Kroger supplier is harmed. But presumably, those people who stop shopping “Krogering” (it’s from an old commercial) will still buy Coke. So, no harm there. But if some supplier only supplies to Kroger that might be a different story. 

    The point here is I think that if you’re thinking about getting aggressive with your advertising, just know that there may be more plaintiffs besides direct competitors lurking out there.       

    Go comment!
  • Social Media Tips For Lawyers

    Apr 01, 2014

    The New York State Bar Association recently put out guidelines to assist lawyers navigate the social media landscape.  While the guidelines aren’t binding outside of New York (and as “guidelines” they’re not really binding in New York for that matter) they do provide some worthwhile suggestions for any lawyers crazy enough to, I don’t know, maintain a blog. 

    The table of contents for the Guidelines provide an overview of the risks that lawyers face when they use social media.   There are five primary areas – advertising, furnishing legal advice, reviewing and using evidence gathered from social media, communicating with clients and non-clients via social media and using social media to research jurors or prospective jurors. 

    For purposes of advertising, the New York guidelines draw a distinction between a social media profile that’s used strictly for personal use and one that’s used for business.  The former isn’t subject to rules about advertising and solicitation, the latter is.  Your best bet may be to keep a pretty rigid line here just to be safe.  And under the New York guidelines, better be careful about using the term “specialist’ in a profile.  Most states have specific rules for when lawyers are in fact “specialists.”  If you don’t qualify as one, better not use that term in a profile.  And the guidelines say you may have a duty to remove posts other people post about you.  So even if a third party unilaterally refers to you as a specialist, you may need to ask them to remove it. 

    On the subject of providing legal advice, it is okay under the New York guidelines to speak generally about a legal topic and even provide general answers to general legal questions. But be careful if that advice gets too specific, or too personal.  And the guidelines frown on “real time”  solicitation of business like via instant messaging or even participation in a chat room. 

    Lawyers are allowed to conduct research by viewing publicly available portions of anyone’s social media profile.  The Guidelines note, though that the person who is the subject of the research may see who was doing the research.  Be careful if that discloses a confidential relationship.  And don’t sneak into protected portions of a profile by deception or by encouraging someone with access to check it out for you.  If you actually use social media to make contact with another person, it matters if they are represented by counsel. If not, you need to disclose your actual identity. If the person is represented you need to get express consent before you can contact them.

    A lawyer can counsel a client to remove content from a site so long as doing so does not constitute spoliation of evidence.  Once a duty to preserve kicks in, the content can’t be removed.  You can also advise a client to post new material as long as that information isn’t false or misleading.  And you can view another person’s protected material that your client provides so long as you didn’t encourage the client to obtain the material improperly.

    And lawyers can use publicly available social media to research prospective jurors or sitting jurors, so long as there is no communication with the juror.  A lawyer may even view publicly available social media of jurors during the trial, but if the lawyer discovers any misconduct, she must promptly bring it to the court’s attention. 

    The guidelines are clearly written and filled with common sense. Well worth a look.  

    Go comment!
  • Penalty Flag On Heisman Pose Photo

    Mar 25, 2014

    As readers of my blog know by now, I am a Notre Dame football fan. That carries with it some character traits. For example, I don’t like the University of Michigan. At all.  And while Brian Kelly can claim Notre Dame’s true rival is USC all he wants, I always took more pleasure in beating the boys from Ann Arbor than I did the Trojans. It may have something to do with the fact that my first football season in South Bend was the year Harry Oliver kicked the improbable field goal to beat them. The fact that Michigan rejected me for its law school has nothing to do with it. That would be petty. And I’m not like that. Usually.

    But despite my disdain for the Maize and Blue, I always kind of liked Desmond Howard’s Heisman pose in a 1991 game against Ohio State. Had he done it against the Irish, I would have considered it bush league. Against OSU, however, I found it awesome. The fact that he did it after returning a punt for 93 yards for touchdown was pretty spectacular.

    Now that iconic photo is in the middle of a copyright lawsuit in a federal court in Michigan. A freelance photographer named Brian Masck snapped the shot. Sports Illustrated used it on its cover in 1991, and paid him $500. But since then the photo has shown up in lots of places that Mack never authorized. And the folks who used the photos didn’t pay him. Hence, the lawsuit.  

    But Masck may have a problem with a legal concept called “laches.”  Laches is the legal equivalent of a late whistle. If a party waits too long before enforcing his rights, he may forfeit them. That is likely to be the defendants’ primary defense here. Masck apparently didn’t register the copyright, or do much of anything else to defend his position until fairly recently. And that may cost him. The case was only recently filed, so it’s hard to predict the outcome with any certainty.

    But the lesson is clear. If you’ve created a work, especially one with a such high profile, you might want to register the copyright and keep an eye out for infringement. In the legal world “delay of game” can come with a sizable penalty.

    Go comment!
  • Jury's Out On Social Media Use

    Mar 18, 2014
    I’ve linked on several occasions to fellow blogger/lawyer Brian Wassom. I could point out that he’s never linked to me, but that would be petty. In any event, here I go again. Brian’s got an interesting piece on a study on juror use of social media. I’ve posted about the topic as well. The interesting thing about the study is that it not only compiles data on the abuses and misuses, it proposes some ways to address the problem. All in all, worth a read.
    Go comment!
  • Even The CDA Has Limits Apparently

    Mar 14, 2014

    The Communications Decency Act is either the best or worst piece of legislation ever passed by the United States Congress, depending on your point of view. Web site operators, who received broad immunity for the content of third party postings, would no doubt count themselves as part of the “best” voting bloc. People who have been the subject of third party postings, and whose only remedy is an action against the anonymous and penniless poster, presumably count themselves among the “worst” group.   

    On balance, courts have applied the CDA broadly, and in most cases have let Web site operators off the hook in cases based on third party posts. But not always. And a recent decision from a federal district court in Massachusetts is one of those occasions where a court pulled on the CDA leash. 

    The case arose from the apparently fiercely competitive world of movers. The plaintiffs were a collection of moving companies who alleged that a competitor -- Xpress Movers – set up a Web site that provided reviews of local moving companies.  According to the complaint, Xpress had an interesting editing style.  It deleted positive reviews about the plaintiffs, along with negative reviews concerning Xpress.  

    In reaction to the lawsuit, Xpress argued that the CDA compelled the court to dismiss the complaint. Xpress argued that the gist of the complaint centered on third party content – the reviews that Xpress actually allowed to remain on the site. And even though Xpress selectively cut certain reviews, that didn’t make Xpress the content creator.   

    But the court didn’t see it that way. It determined that the complaint was not based on information provided by another content provider. Rather, in the court’s view, the claim centered on Xpress’s “Ill-intentioned deletion[s]” coupled with representations on the Web site that the site offered “accurate” data and is “serious about reviews quality.”  According to the court, that combination made the site a developer of the alleged misinformation. 

    The court also ruled that the portion of the CDA that provides immunity to the site operator for action “voluntarily taken in good faith to restrict access to... material” didn’t apply because Xpress didn’t edit in good faith. 

    I’m not sure where this holding will lead. The theory of the CDA is that if a third party posts actionable content the site host isn’t responsible.  Here, none of the specific content is actionable. That is, there doesn’t appear to be any allegation that any one posts defamed the plaintiffs. Instead, the theory seems to be, that Xpress edited the site in a way that created an inaccurate impression overall. And in doing so, Xpress didn’t live up to its promise to maintain an “accurate” review site. 

    But does the site’s promise about “accuracy” create a duty to the plaintiffs? Typically such promises don’t. I can’t sue a TV station because I got caught in an unforecasted thunder storm, even if the station says it has the most accurate weather forecast. And what if Xpress took down the positive competitor reviews because it suspected those reviews weren’t on the up and up? This decision was in response to a motion to dismiss – so the case is in its infancy. But even though these aren’t the most sympathetic defendants, I’m not sure the court got this one right.          

    Go comment!
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