law bookstore
Bookstore
cyber law updates
Cyberlaw News
Mishpat Legal Information Discuss law
Discuss Law
updated legal news
Legal News


cyberlaw informer #51

Welcome to the 51st issue of the Mishpat Cyberlaw Informer - 
Law on the net newsletter from http://mishpat.net

This newsletter is sent only to subscribers. If you no longer 
wish to receive the Cyberlaw Informer, follow the unsubscribe 
instructions at the bottom of this newsletter.

--------------------------------------------------------
 
In this issue:

1. Introduction
2. Deep linking
3. Encryption and the Freedom of Speech 
4. Cyberlaw resource of the week


--------------------------------------------------------

################
1. Introduction
################

I would like to welcome the new subscribers who joined the Cyberlaw
Informer since the previous issue. 
 
As promised in the previous issue, sent out just a couple of days ago,
this issue contains two articles and a resource review.

Both articles take a look at recent decisions by U.S. courts. 
The first article reviews a ruling in the TicketMaster v. Tickets.com
case, concerning deep linking, which is the practice of linking to
interior pages instead of linking to the homepage of the linked site.
The second article is a summary of the Junger case, in which a U.S.
appeals court ruled for the second time that encryption software code is
protected free speech.

The resource reviewed in this issue is the TechnoLawyer community at
http://www.technolawyer.com which a think many of you will find to be a
helpful and resourceful community.

This newsletter has almost 1,900 readers, and I hope to reach 2,000
subscribers during June. You can help reaching that goal by forwarding
this newsletter to your friends and colleagues and asking them to
subscribe by visiting http://CyberlawInformer.com

In the previous issue I forgot to add the link to the Sony v. Connectix
reverse engineering ruling. The article about the case was published in
Cyberlaw Informer #45 and is available at
http://mishpat.net/cyberlaw/archive/informer45.shtml

I want to thank Al Montero who recently published two of my articles in
the ZeroCost Digest. To subscribe to the ZeroCost Digest visit
http://www.zerocost.com


I hope you enjoy reading the newsletter. Comments, tips, and articles
are always welcome. Send them to mailto:editor@mishpat.net

The Mishpat Cyberlaw Informer Archive (issues 1-48) is located at:
http://mishpat.net/cyberlaw/archive

Feel free to use any of the material, or forward the newsletter to a
friend. Just don't forget to mention that they can subscribe to the
Cyberlaw Informer by visiting http://CyberlawInformer.com



--------- sponsor message ----------

FreeShop

FreeShop is the starting point for online shopping, featuring  
thousands of free and trial offers. Free samples, trial issues,  
demos, coupons, catalogs, trial periods, and  product information.

FreeShop.com is a leading online direct marketing network. Learn about
or try new products, and choose from a variety of free, trial and
promotional offers from hundreds of well-known companies.

http://mishpat.net/ads/freeshop

--------- sponsor message ----------




##############
2. Deep Linking
##############

In a closely watched cyberlaw case, U.S. District Judge Harry Hupp ruled
that web sites can legally provide links to any pages on all other
sites. 

Tickets.com won the ruling in a case filed by TicketMaster that alleged
that deep linking should be banned. Deep links bypass the front page of
a website, thus allowing visitors to skip over the prime-area
advertising that is typically placed on a website's home page and go
directly to specific information found on one of the interior pages.

This isn't the first time TicketMaster has tried to legally ban deep
linking. In April 1997 the company filed a lawsuit against Microsoft to
stop Seattle Sidewalk, Microsoft's service (no longer operational), from
linking to TicketMaster's website. The case was settled when the two
companies worked out an agreement to license TicketMaster's content. 


* Factual Background *

TicketMaster's web sites allows customers to purchase tickets to various
events (concerts, ball games, etc.) online. On the TicketMaster home
page, there are instructions and a directory to subsequent pages (one
per event). The event pages provide basic information (short description
of the event, date, time, place, and price) and a description of how to
order tickets by either internet response, telephone, mail, or in
person. 
The home page also contains "terms and conditions" which proscribe,
among other things, copying for commercial use. However, the customer
need not view the terms and conditions to proceed straight to the event
page which interests him. 
TicketMaster has exclusive agreements with the events it carries on its
web pages so that tickets are not generally available to those events
except through TicketMaster.

Tickets operates a web site at Tickets.Com performs a different
ticketing service. While Tickets does sell some tickets to certain
events on its own, it also provides information as to where and how
tickets which it does not sell may be purchased. Where Tickets does not
itself sell the tickets, a place is given the customers co click for a
reference to another ticket broker. 

Where the exclusive ticket broker is TicketMaster, and the customer
clicks on "Buy this ticket from another on-line ticketing company", the
customer is transferred to the interior web page of TicketMaster for the
particular event (bypassing the home page), where the customer may buy
the tickets from TicketMaster. The interior web page contains the
TicketMaster logo and the customer must know he is dealing with
TicketMaster, not Tickets.

Tickets provides its visitors with the following explanation:
"These tickets are sold by another ticketing company. Although we can't
sell them to you, the link above will take you directly to the other
company's web site where you can purchase them." 

In order to obtain the basic information on TicketMaster events, Tickets
is alleged to copy the interior web pages and extract the basic
information (event, place, time, date and price) using automatic
software ('spider' or 'crawler') that scan TicketMaster's site. That
information is then placed in Tickets' format on its own interior web
pages. The suit also accused Tickets.com of publishing false and
misleading information about Ticketmaster's ticket availability. 


* The complaint *
TicketMaster said that Tickets.com's deep linking was wrong and harmful
for several reasons. 
First, it claimed that the practice violated key sections of its "terms
and conditions". 
In addition, TicketMaster contended that deep linking interfered with
its economic relationships with advertisers, who paid handsomely to
advertise on the site's home page. 
Finally, the company said that Tickets.com was guilty of "passing off"
because consumers might confusingly conclude that TicketMaster and
Tickets.com were affiliated. 

In response, Tickets.com denied any wrongdoing and filed a motion to
dismiss all 10 of Ticketmaster's legal claims, which addressed linking
and non-linking conduct.
It was in the context of ruling on the preliminary "motion to dismiss"
that Judge Hupp issued his order last week, allowing some claims to
proceed and dismissed others. 


* The ruling *

A copyright may not be claimed to protect factual data. While the
expression, organization, placement, etc., of the factual data may be
protected, Tickets.com is not alleged to have copied the method of
presentation, but rather to have extracted the factual data and
presented it in its own format. Thus, the court rejects Ticketmaster's
basic contention that it is copyright infringement to take basic facts
from its publicly available web pages and use those facts. 

As to the practice of deep linking, which lies at the core of this
dispute, Judge Hupp states that:
"Hyperlinking does not itself involve a violation of the Copyright Act
since no copying is involved. The customer is automatically transferred
to the particular genuine web page of the original author. There is no
deception in what is happening. This is analogous to using a library's
card index to get reference to particular items, albeit faster and more
efficiently."


TicketMaster's breach of contract claim is founded on the "terms and
conditions" set forth on its home page. In defending this claim,
TicketMaster made reference to the "shrink-wrap license" cases, where
the packing on the outside of the CD stated that opening the package
constitutes adherence to the license agreement contained therein.
Jude Hupp rejected that claim and noted that this case was different
because the "shrink-wrap license agreement" is open and obvious and in
fact hard to miss. Many web sites make you click on "agree" to the terms
and conditions before going on, but TicketMaster does not. Further, the
terms and conditions are set forth so that the customer needs to scroll
down the home page to find and read them. Many customers instead are
likely to proceed to the event page of interest rather than reading the
"small print." It cannot be said that merely putting the terms and
conditions in this fashion necessarily creates a contract with anyone
using the web site. 


TicketMaster's complaint also alleges that Tickets.com falsely suggested
or implied an association with TicketMaster, by giving misleading
information about phone numbers, and unauthorized control over event
pages of TicketMaster. The complaint also alleges deep linking as an
example of unfair competition, but the court concluded that deep linking
by itself (i.e., without confusion of source) does not necessarily
involve unfair competition. 


However, Judge Hupp allowed a few claims that attack deep linking to
proceed. For example, he allowed the passing-off and reverse-passing-off
claims to remain, as well as the interference claim. And although he
dismissed the breach of contract claim, he granted TicketMaster
permission to file an amended complaint with facts showing that its
"terms and conditions" created an enforceable contract, seen and agreed
to by Tickets.com. 
This means that the linking controversy continues. 



* Personal comments * 

I think that Judge Hupp missed a few important factors that work in
favor of Tickets.com.

1. Advertisers usually pay per ad impression (for example 35$ for every
1,000 visitors who view the ad). This means that advertising on the home
page is usually not more expensive per impression, it is more expensive
because the home page is usually viewed by more visitors, thus creating
more impressions. Theoretically, if no visitors visit the home page, but
the same number of page views are generated by interior pages,
TicketMaster wouldn't lose any advertising revenue.

2. In fact, TicketMaster might be making higher profits thanks to
Tickets.com. Tickets.com sends visitors to TicketMaster, thus creating
more advertising impressions and selling more tickets.

3. The reason TicketMaster is going after Tickets.com is probably that
in the long run TicketMaster wants visitors to come directly to
TicketMaster, and not go through Tickets.com. The reason is simple: if
Tickets.com has a limited inventory (can't offer TicketMaster tickets)
people will not visit it, and go directly to another site with a larger
tickets database, namely to TicketMaster.com. Under that scenario,
TicketMaster will also sell at least some of the tickets currently sold
directly by Tickets.com.

4. The above points might explain why TicketMaster is not going after
search engines who use "spidering" techniques, and index interior pages.
The search engines are not potential competitors, so when they bring
visitors to interior pages, it serves TicketMaster's interests.
TicketMaster has no problem with AltaVista or Google crawling its site,
since they don't compete in selling tickets. So TicketMaster isn't
against deep linking, only against a specific deep linker.


The full text of TicketMaster Corp. v. Tickets.Com, Inc.
http://www.gigalaw.com/library/ticketmaster-tickets-2000-03-27.html



--------- sponsor message ----------

FreeShop

FreeShop is the starting point for online shopping, featuring  
thousands of free and trial offers. Free samples, trial issues,  
demos, coupons, catalogs, trial periods, and  product information.

FreeShop.com is a leading online direct marketing network. Learn about
or try new products, and choose from a variety of free, trial and
promotional offers from hundreds of well-known companies.

http://mishpat.net/ads/freeshop

--------- sponsor message ----------



##################################
3. Encryption and the Freedom of Speech
##################################

A federal appeals cleared the way for Peter Junger, a law professor, to
post previously banned encryption software on the Internet, finding that
computer code qualifies as speech protected by the First Amendment. The
court ordered that the case be sent back to the trial court for
reconsideration. 


* Encryption *

Encryption is the process of converting a message from its original form
(plaintext) into a scrambled form (ciphertext). Most encryption today
uses an algorithm, a mathematical
transformation from plain text to ciphertext, and a key that acts as a
password. Generally, the security of the message depends on the strength
of both the algorithm and the key.

Encryption has long been a tool in the conduct of military and foreign
affairs. Encryption has many civil applications, including protecting
communication and data sent over the Internet, such as secure credit
card transactions in the popular SSL (Secure Socket Layers) protocol
used in most e-commerce sites. 
As technology has progressed, the methods of encryption have changed
from purely mechanical processes, such as the Enigma machines of Nazi
Germany, to modern electronic processes. Today, messages can be
encrypted through dedicated electronic hardware and also through
general-purpose computers with the aid of encryption software.

For a general-purpose computer to encrypt data, it must use encryption
software that instructs the computer's circuitry to execute the encoding
process. Encryption software, like all computer software, can be in one
of two forms: object code or source code. Object code represents
computer instructions as a sequence of binary digits (0s and 1s) that
can be directly executed by a computer's microprocessor. Source code
represents the same instructions in a specialized programming language,
such as BASIC, C, or Java. Individuals familiar with a particular
computer programming language can read and understand source code.
Source code, however, must be compiled (converted) into object code
before a computer will execute the software's instructions. This
conversion is conducted by compiler software. 


* Export regulations *
The U.S. Export Administration Regulations create a comprehensive
licensing scheme to control the export of non-military technology,
software, and commodities. The Regulations are structured around the
Commodity Control List, which lists items subject to export control.
Each item on the List is given an Export Control Classification
Number that designates the category of the controlled item and the
reasons why the government controls the item's export. The reasons for
control affect the nature and scope of the export controls. 

Encryption software, including both source code and object code, is
regulated under classification 5D002 Export Control for national
security reasons. Generally, the Regulations require a license for the
export of all encryption items to all foreign destinations, except
Canada. 
For encryption software, the definition of "export" also includes
publication of the software on the Internet, unless steps are taken to
restrict foreign access to the Internet site. 


* Background *
Peter Junger is a professor at the Case Western University School of
Law. Junger maintains web sites that include information about courses
that he teaches, including a computers and the law course. Junger wishes
to post encryption source code that he has written, to demonstrate how
computers work. Such a posting is defined as an export under the
Regulations.

On June 12, 1997, Junger submitted three applications to the Commerce
Department, requesting determinations of commodity classifications for
encryption software programs and other items. On July 4, the Export
Administration told Junger that although it found that four programs
were subject to the Regulations, the Export Administration found that
the first chapter of Junger's textbook, Computers and the Law, was an
allowable unlicensed export. Though deciding that the printed book
chapter containing encryption code could be exported, the Export
Administration stated that export of the book in electronic form would
require a license if the text contained 5D002 software. Since receiving
the classification determination, Junger has not applied for a license
to export his classified encryption source code. 

Junger filed this action to make a facial challenge to the Regulations
on First Amendment grounds (freedom of speech), seeking declaratory and
injunctive relief that would permit him to engage in the unrestricted
distribution of encryption software through his web site. 

The district court granted summary judgment in favor of the government,
holding that encryption source code is not protected speech under the
First Amendment, that the Regulations are permissible content-neutral
regulations.


* The appeal *

Chief Judge Boyce F. Martin delivered the opinion of the appeals court.
Judge Martin noted that the issue of whether or not the First Amendment
protects encryption source code is a difficult one because source code
has both an expressive feature and a functional feature. Much like a
mathematical or scientific formula, one can describe the function and
design of encryption software by a prose explanation; however, for
individuals fluent in a computer programming language, source code is
the most efficient and precise means by which to communicate ideas about
cryptography.

The U.S. Supreme Court explained that "all ideas having even the
slightest redeeming social importance," including those concerning "the
advancement of truth, science, morality, and arts" have the full
protection of the First Amendment. 

A musical score cannot be read by the majority of the public but can be
used as a means of communication among musicians. Likewise, computer
source code, though unintelligible to many, is the preferred method of
communication among computer programmers. 
Because computer source code is an expressive means for the exchange of
information and ideas about computer programming, Judge Martin ruled
that it is protected by the First Amendment. 

The functional capabilities of source code, and particularly those of
encryption source code, should be considered when analyzing the
governmental interest in regulating the exchange of this form of speech. 
Judge Martin noted that national security interests can outweigh the
interests of protected speech and require the regulation of speech. In
the present case, the record does not resolve whether the exercise of
power in furtherance of national security interests should overrule the
interests in allowing the free exchange of encryption source code.

In light of the recent amendments to the Export Administration
Regulations, Judge Martin remanded the case to the district court, in
order to examine the new regulations and determine if Junger can bring a
facial challenge. 

The full text of the ruling can be found at:
http://pacer.ca6.uscourts.gov/cgi-bin/getopn.pl?OPINION=00a0117p.06



--------- sponsor message ----------

LegalSeeker

In a single search, you can combine the knowledge base of 
40 Legal search engines with the popular Web search 
engines - pinpointing the exact info you need with LegalSeeker.
 
Designed for Internet users who desire to run highly 
comprehensive searches that combine the results of multiple 
search engines, LegalSeeker delivers a clean list of results 
that can be saved, viewed offline, easily organized, and 
updated automatically.

Get you free trial (full price $99.95) Windows only.
http://mishpat.net/ads/legalseeker


--------- sponsor message ----------



#######################
4. Resource of the week
#######################

This week's resource is the TechnoLawyer Discussion List at
http://www.technolawyer.com

The TechnoLawyer Community is a free email community for lawyers and
others in the legal profession who help law firms and/or legal
departments make wise business and technology decisions. 
Members of the TechnoLawyer Community share their experiences and
knowledge with their peers in a carefully controlled format, thanks to
the community moderators.

There are two main topics of discussion:
* Technology assisting legal professionals such as case management
software, effective communication systems, legal word processing,
electronic filing, Internet legal resources and more. 
* Various technology law issues. For example, recent discussion topics
include business model patents and the Microsoft remedy.

You can join the TechnoLawyer Community by filling in the form at:
http://www.technolawyer.com


If you would like to recommend an Internet legal resource, please send
the details to mailto:editor@mishpat.net Full credit is given to
contributors.
You can also recommend resources at the online bulletin board
http://mishpat.net/cgi-bin/bbs/UltraBoard.pl



That is all for this week,
Yedidya (Didi) M. Melchior 
Editor 


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 
If you have enjoyed reading this newsletter and have found 
useful information in it, we'd appreciate your help in 
spreading the word about it. You can do this by forwarding 
a copy to your friends and telling them about it. 
  

To subscribe, please visit 
http://CyberlawInformer.com

To unsubscribe, please go to 
http://mishpat.net/cyberlaw/unsubscribe.shtml

Information on how to sponsor Mishpat Cyberlaw Informer 
mailto:advertising@mishpat.net

Send suggestions and comments to 
mailto:editor@mishpat.net

If you wish to contribute an article 
mailto:editor@mishpat.net

Online archives
http://mishpat.net/cyberlaw/archive

Copyright 1999-2000 Mishpat.Net Internet Legal Information

The Cyberlaw Informer

Your E-mail Address



Back to Mishpat-Update archive



law bar



| Home | About | Comments | Advertise With Us | Bookstore | Legal News | Add a Resource |

| Discuss Law | Recommend this site | Advanced Search | What's New |

| Israeli Lawyers | Directory | Privacy Policy | Disclaimer |



Copyright © Mishpat-Net 1998-2004