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The Mishpat-Update #22

Welcome to the twenty second issue of the weekly Mishpat Update, Law on
the net from

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In this issue:

1. Introduction
2. Michigan tries restricting online pornography
3. Award winners
4. Cyberlaw news and updates


1. Introduction

I would like to welcome the 25 new subscribers who joined the list this

This week's feature article takes a look at two different attempts in
Michigan, to block access to pornographic web sites. The first (which
failed) was a new Internet crime bill, that was struck down by a
federal judge. The second is an a new library policy giving an
incentive to use blocking software when surfing the web using library

July's Mishpat Award winners are announced in the third section of this
newsletter. If you run a law related web site, and would like to apply
for August's award, fill out the application form at

The Mishpat Update archive (issues 1-19) is available at:

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 by sending
a blank email to

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2. Michigan tries restricting online pornography

Judge Arthur J. Tarnow of U.S. Federal District Court in Detroit,
issued a preliminary injunction to block a new Michigan law intended to
shield children from online sexual predators. The Judge ruled that the
law was so broadly worded that it would curb legitimate speech online. 

The new law, called the Internet Crime Bill, is an amendment to an
older law used to prevent stores from selling pornographic magazines to
children. It would, with a few exceptions, make it illegal for a person
to knowingly distribute "sexually explicit matter" considered "harmful
to minors" to those under 18 years old. Penalties include prison terms
of up to two years in jail and fines of up to ,000. 

The Michigan affiliate of the American Civil Liberties Union (ACLU),
along with 10 other plaintiffs, filed suit in Detroit to stop the
measure. Plaintiffs include Internet companies and a Michigan AIDS
information group. 
The law was due to take effect August 1. Judge Tarnow's ruling
prevented implementation of the law until a full trial is held later
this year.

Judge Tarnow of Federal said the new law violated both First Amendment
free speech rights and the U.S. Constitution's Commerce Clause, which
generally bars a state from regulating commerce wholly outside its
Judge Tarnow wrote that: "Even under the guise of protecting minors,
the government may not justify the complete suppression of
constitutionally protected speech, because to do so would 'burn the
house to roast the pig,'" 

This isn't the first such law to be struck down. State laws, in New
York and New Mexico, and federal laws, like the Communications Decency
Act, have not done well in courts. Judges have so far concluded that
the laws are so sweeping that they restrict the First Amendment rights
of adults. In addition, courts have found that parental use of blocking
software is a less restrictive means to prevent children from gaining
access to online pornography. 

The ACLU's press release describing the case:

The full 31 page opinion is available (in Adobe PDF format) at:

In other, not directly connected news, unfiltered Internet access at
the Georgetown Township Library in suburban Grand Rapids, Michigan,
will cost users  per hour. The new policy, approved by the township
administration, was a reaction reacting to the new state law discussed

One of the passages in the Internet Crime Bill, says libraries may
provide filtered machines that block "matter that is harmful to
minors," provided there is also at least one unblocked computer for
adults and chaperoned minors. The new policy is a way to work around
the law, which runs counter to trustees' unanimous February decision to
install blocking software on all workstations. 
It is expected that nobody will pay the 100 hour fee to use the
unblocked computer, and in that way de-facto all the surfing will be
done on computers with blocking software.

This story comes from:

3. July Award Winners

The Mishpat Award is awarded every month to selected law related web
sites. To view previous winners visit July's
winners are:

1. Illinois State Bar Association (ISBA) web site
The site offers alot of information about law in Illinois. The ISBA
site offers rich content along with excellent graphic design. The
information on the web site includes Legislative News, continuing legal
education (CLE) programs, rulings from the 7th circuit and from
Illinois' courts, discussion groups,free email updates and much more. 
For Illinois lawyers this is a "must visit frequently" site. This site 
is also highly recommended to others, because it shows how the net can 
help keep lawyers more informed, and make legal information available 
to the public.

2. Katsuey's Legal Links
Another online directory of legal links. The information is organized
in 36 categories of legal related links including arbitration, 
bankruptcy, business and corporate, consumer resources, criminal and 
more. Site navigation would have been easier if each category was 
placed on a different web page, but this is a good selection of links 
(especially about U.S. law).

If you run a law related web site, and would like to apply for the
Mishpat Award, visit and fill in
the online application form.

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3. Cyberlaw Updates

Each week Mishpat-Update brings you the latest news about
online and computer law, with links to the full reports available
on the web.

* FTC settles first Y2K fraud case *
The U.S. Federal Trade Commission said it has settled with a Canadian
company over charges that telemarketers made false and misleading
claims about year 2000 protection services. The FTC said the company
was offering a Y2K protection package claiming to prevent Y2K related
problems by affixing adhesive stickers to credit cards. The settlement
calls for NCCP and its owner to pay ,000 to the agency and bans the
company and its owner from selling credit card protection or
registration programs in the U.S. The FTC's press release can be found

* EU members fail to implement data privacy directive *
The European Commission is proceeding with infringement proceedings
against nine member states of the European Union for failing to comply
with the data protection directive that took effect last October. The
Commission has given France, Luxembourg, the Netherlands, Germany, the
U.K., Ireland, Denmark, Spain and Austria two months to comply with the
directive. To date only Greece, Portugal, Sweden, Italy, Belgium and
Finland have fully implemented the directive.

* A uniform e-commerce bill proposed *
The U.S. National Conference of Commissioners on Uniform State Laws,
signed off on a bill designed to unify commercial laws governing the
licensing of everything from software to stock quotes. Such e-commerce
transactions frequently cross state lines, creating confusion about
what state's laws apply. The Uniform Computer Information Transaction
Act (UCITA), now heads to state legislatures, where lawmakers can vote
up or down on the measure.
UCITA has the strong backing of many large software and information
companies, such as the Business Software Alliance and the Nasdaq Stock
Market. But last April, the American Law Institute dealt a serious blow
to UCITA's predecessor when the venerable organization withdrew its
support. 24 state attorney generals already joined the opposition,
along with many consumer groups. The controversy is likely to scare
away many state lawmakers, many of whom are unfamiliar with ecommerce.
The full text of the proposed bill is available at:

* U.K. bill might place limits on encryption *
The United Kingdom's Department of Trade and Industry published a
report on Promoting Electronic Commerce, including draft legislation.
The Electronic Communications Bill, if passed into U.K. law, could
result in encryption users getting two years imprisonment for refusing
to hand over the encryption keys. The report and the legislation draft
are available (in Adobe Acrobat PDF format) at:

* Convicted hacker fights back *
The famous hacker Kevin Mitnick and his attorneys are asking a federal
judge to unseal a court filing that they claim proves the government
was guilty of misconduct while building its case against the hacker.
Mitnick claims the government manipulated the facts to allege losses
that were grossly inflated. As part of a plea settlement, Mitnick
pleaded guilty to seven felonies and admitted to penetrating computers
at such companies as Motorola and Sun Microsystems. On August 9, he's
expected to be sentenced to 46 months in prison, on top of the 22
months he received for cell phone cloning and an earlier supervised
release violation. The only sentencing issue left unresolved is the
amount of money Mitnick will owe his victims. Prosecutors are seeking
.5 million in restitution -- a modest figure compared to the more
than  million the government quoted to an appeals court last year,
when it successfully fought to hold the hacker without bail. The July
22 motion filed by Mitnick's attorney accuses the government of
coaching victim companies on how to artificially inflate their losses.,6061,2306704-2,00.html

* NSI threatens MAPS *
Mail Abuse Prevention Systems (MAPS), said in an Internet posting that
it is considering adding Network Solutions Inc. (NSI) to its real time
Black hole List following "repeated attempts to get them to stop
unsolicited bulk commercial email to all domain holders." The filter,
which lists Internet service providers and companies that permit spam
to be sent on their systems, would then be made available to network
administrators to use in blocking email from NSI and other offending
organizations. The filter is used voluntarily by at least 180 licensed
subscribers. and has been instrumental in getting Microsoft Network,
America Online, Netcom, and others to modify their email policies when
those companies temporarily were blacklisted. 
NSI, however, is not taking the threat lying down. In a letter sent
Friday, Jonathan Emery, NSI's general counsel, warned that MAPS faced
serious legal action if it prevented NSI email from reaching its
customers. Emery wrote to MAPS "You should be prepared to accept the
consequences of your actions should a company such as lose
its domain name, and thus its e-commerce business, as a result of
having its notices and invoices intercepted and destroyed." He added
that NSI's emails were "vital catalysts to free and open commerce," and
are not SPAM.
You can read NSI letter, and comments posted on the Slashdot billboard

* California adopts digital signature law *
California's Governor, Gray Davis, signed a bill into law that allows
contracts with electronic signatures to count as legal documents. The
new law will enable brokerage firms to enter contracts with their
customers through digital signatures, rather than signing papers.

* MS Word and the length of lawyers' briefs *
The U.S. 7th Circuit Court of Appeals found that Microsoft's Word 97
word processor, undercounts words in footnotes. This problem could cost
lawyers a sanction for filing a brief that exceeded the type volume
limit. The decision in Anthony Desilva, ET AL. v Joseph G.
Dileonardi, US Marshal, ETC. can be found at:

* Internet Tax proposed by U.S. senator *
The Sales Tax Safety and Teacher Funding Act, Introduced by U.S.
Senator Fritz Hollings, would use the proceeds to fund teachers'
salaries in elementary and secondary school. Hollings' proposed bill
infringes on the Internet Tax Freedom Act, enacted last October. The
Internet Tax Freedom Act imposed a three year waiting period on state
and local Internet taxes, and formed the Advisory Commission on
Electronic Commerce to study Net related taxes, tariffs and other

* Diamond and RIAA settle MP3 lawsuit *
Last October, the Recording Industry Association of America (RIAA)
filed a lawsuit against Diamond Multimedia Systems Inc., claiming that
Diamond's Rio player violated the 1992 Audio Home Recording Act. The
court found in favor of Diamond in June (that ruling was the center of
the Mishpat Update #17 feature article), yet litigation continued about
the legality of the Rio player and the openness of the digital music
download industry. 
On Wednesday, the parties dismissed their legal actions and said they
are mutually satisfied with the resolution of outstanding legal issues.
Both groups said they will now work together to focus their attention
on the Secure Digital Music Initiative (SDMI), a consortium of music
industry, electronic and multimedia firms working to combat digital
music piracy.,1087,9_174801,00.html

* Fighting alcohol online sales *
The U.S. House of Representatives passed a bill that aims to add teeth
to state alcohol laws (the bill was reported here last week). The bill
only after it was amended to clarify it is not an attack on e-commerce.
The amendment made clear that Internet providers and regional Bells
would not be held liable if violations of the law occurred over their
lines. Thirty nine states have placed outright bans or restrictions on
direct shipment of alcohol. But enforcing those state laws frequently
can be hampered when local authorities try to prosecute an out of state
offender. The new bill would allow prosecutors in all 50 states to try
offenders in federal courts, which generally have wider jurisdiction.

* ISP sues computer manufacturer *
Internet service provider EarthLink Network Inc. sued low cost PC maker Inc. for allegedly breaching a distribution agreement
between the companies. Under the terms of the pair's distribution pact,
Microworkz distributed EarthLink's Internet access software with a 
PC called the Webzter. EarthLink charged Microworkz with failing to
deliver payments that were part of the distribution agreement.
Microworkz responded today by saying it will file its own lawsuit next
week against EarthLink. Its lawsuit will accuse EarthLink of supplying
faulty software and failing to educate its technical support staff
about Microworkz's Webzter program.

* Symantec site Hacked *
Hackers broke into the servers of network security and utilities firm
Symantec Corp. defacing the company's Web site. The hackers claimed to
have infected Symantec's network two months ago with a worm (a computer
virus that infects networks automatically). The company (manufacturer
of Norton anti virus software) denied that any worm existed on its

* Colorado lawsuits to be filed over the Internet *
The state of Colorado signed a deal with a Texas company, JusticeLink,
to phase in electronic filing in district courts statewide. Officials
say that by the end of next year, if all goes well, lawyers will be
able to push a button on their computer terminals to make filings from
their offices, while judges will have the option of emailing orders
and decisions instantaneously from their chambers. The system will
expand county by county, with a statewide system in place by December
(Free registration to the NY times required)

If you know of any cyberlaw updates, please send them to

That's all for this time,
see you next week

Yedidya M. Melchior 

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