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The Mishpat-Update #29

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

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In this issue:

1. Introduction
2. Victory for freelancers
3. NSI and ICANN reach an agreement
4. Cyberlaw resource of the week
5. Cyberlaw news and updates


1. Introduction

I would like to welcome the 22 new subscribers who joined the list this

Starting this week, Mishpat Update will feature a new regular section
called "Cyberlaw resource of the week". The new section features one
law related web site, book or Ezine every week. If you want to
recommend resources of any kind, just send an email with a short
description to

This issue has two feature articles. The first takes a look at a recent
ruling that clarifies freelance writers' rights over their work. The
second brings the background and details of a new agreement that will
shape the future of domain name registration. As usual, the last
section of this newsletter is packed with cyberlaw news and updates.

I hope you enjoy reading this newsletter, don't forget to
send your comments to

The Mishpat Update archive (issues 1-28) 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
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2. Victory for freelancers

Freelance writers whose material is republished without permission by
The New York Times and other publishers on electronic databases have
won a major victory with a ruling by the U.S. Court of Appeals for the
Second Circuit. 

The Second Circuit found in Tasini v. The New York Times Co., that the
Times and other publishers are not protected by the privilege against
copyright infringement, afforded to publishers of "collective works".

The Second Circuit U.S. Court of Appeals sided with six freelance
writers who claimed that The NY Times Co. and other major media had
infringed on their copyrighted articles by making them available on
commercial databases (such as Lexis-Nexis and CD-ROMs) without
providing additional compensation.

The newspapers had argued that they owned the copyright to the
"collective works" (the entire periodical in which the stories were
published) and, therefore, were allowed to reproduce the individual
works in a "revision" of the collective work. 

U.S. District Judge Sonia Sotomayor, of the Southern District of New
York, had agreed with the publishers. But the Second Circuit reversed. 

Chief Judge Ralph K. Winter, writing for the court, said "there is no
feature peculiar to the databases at issue in this appeal that would
cause us to view them as 'revisions.' NEXIS is a database comprising
thousands or millions of individually retrievable articles, taken from
hundreds of thousands of periodicals. It can hardly be deemed a
'revision' of each edition of every periodical that it contains." 

Judge Winter reasoned that "Even if a NEXIS user so desired, he or she
would have a hard time recapturing much of 'the material contributed by
the author of such collective work ... In this context it is
significant that neither the publishers nor NEXIS evince any intent to
compel, or even to permit, an end user to retrieve an individual work
only in connection with other works from the edition in which it ran.
Quite the contrary, The New York Times actually forbids NEXIS from
producing 'facsimile reproductions' of particular editions." 

Therefore, Judge Winter concludes, the NY Times and other newspapers
can not claim that the freelancers' work was used as part of
"collective works".

Although the ruling has widespread implications on writers' rights,
the scope of the decision is limited to the default provisions of
the U.S. copyright act. As Judge Winter wrote: "We emphasize that the
only issue we address is whether, in the absence of a transfer of
copyright or any rights thereunder, collective work authors may
re-license individual works in which they own no rights". This means
that parties can negotiate around that default provision, and decide
explicitly what rights the authors are giving the publisher and what
compensation the author will get for the permission to use his work in
other media.

The full text of the opinion is available at:

Comments and recommendations following the case, by the National
Writers Union:

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3. NSI and ICANN reach an agreement

The U.S. Department of Commerce has resolved the legal issues needed to
migrate management of the Internet domain name system from Network
Solutions Inc. (NSI), a government contractor, to the nonprofit
organization ICANN (Internet Council for assigned names and Numbers).

The Commerce Department, NSI and ICANN announced that they have reached
a series of agreements designed to privatize the registration of .com,
.net and .org domain names. The agreements are expected to be signed in
November, after ICANN's membership approves them. 

For the past six years, NSI has had an exclusive agreement with the
Commerce Department to register .com, .net and .org domain names, and
to collect fees for the use of those names. NSI also maintains a
central database of assigned names called WHOIS as the sole registrar
of domain names. 

On July 1, 1997, President Clinton issued A Framework for Global
Electronic Commerce and directed the Secretary of Commerce to privatize
the management of the domain name system (DNS) in a manner that
increases competition and facilitates international participation in
its management. On June 8, 1998,the Department of Commerce issued a
Statement of Policy entitled Management of Internet Names and Addresses
(the "White Paper"). The White Paper called upon the private sector to
create a new non profit corporation to assume responsibility, over
time, for the management of certain aspects of the domain name system. 
In November 1998, the Department of Commerce entered into a Memorandum
of Understanding with the non-profit organization ICANN, for
collaborative development and testing of the mechanisms, methods, and
procedures necessary to transition management responsibility for
specific DNS functions to the private sector.

Under the new agreement. For the first time, NSI agreed to recognize
the authority of ICANN to regulate aspects of the domain name system,
and agreed to grant public rights to certain features of its domain
name database. This was a major change in NSI strategy. 

The agreements give a boost to ICANN, which has been struggling to
create an organizational process and a steady method of funding. Upon
signing the agreement, NSI will pay ICANN 1.25 million USD towards its
share of annual registrar fees. NSI has agreed that it will approve an
ICANN registrar fee policy as long as its share of the registrar fees
does not exceed 2 million USD. 

With certain limitations, the deal guarantees public access to NSI's
Whois queries that identify the owner of a domain name, as well as bulk
access for a fee. NSI got a three year extension on the contract of
running the Whois database, and will now operate it until 2004. NSI
was also given a financial incentive to spin off its registration
business within the next 18 months. If it does so, NSI's contract to
maintain WHOIS will be extended until 2008.

NSI will also give up it's right to use the name "Internic". Within six
months, the InterNIC website (as well as the,, and domain names) will be transferred to the
Department of Commerce. Within nine months, NSI will modify all of its
registration templates and otherwise migrate from the use of the term
"InterNIC," or Internet addresses that reflect the term "InterNIC." 

For its part, NSI also won some important concessions. The company will
be paid 6 USD (down from 9 USD) for each domain name registered in the
.com, .org, and .net top-level domains.  NSI will also continue to
manage the authoritative root server in accordance with the direction
of the Department of Commerce. This management responsibility may be
transferred to ICANN at some point in the future. 

ICANN's board must approve the agreements and will take up the issue at
its next meeting on November 4. The agreements are posted for a 30 day
comment period at ICANN's site:

4. Cyberlaw resource of the week

This week Mishpat Update starts featuring selected cyberlaw and law on
the Internet resources. In each issue I will review one resource: a web
site, a book available online or an electronic magazine (Ezine).

I want this new section to be interactive, and based mostly on your
experience and knowledge. So please send any tip or recommendation to

This week we take a look at an incredible international law project.

Did you ever want to read the Chinese constitution, download Yemen's
constitution, take a look at the New Zealand Human Rights Act, or learn
about Finland's constitution?

Now all these constitutional resources, along with many other, are
available from the International Constitutional Law (ICL) project at

ICL provides English translations of world constitutions and other
textual material related to constitutional documents. It cross
references those documents for quick comparison of constitutional

For anyone involved in international comparative law, constitutional
law, or simply interested in international law and law of other
nations, this site is extremely helpful

Highly recommended:

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5. Cyberlaw news and 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.

* eBay stops marijuana auction *
Online auction giant eBay Inc. said it pulled an auction for 500
pounds of marijuana, although it had no way of knowing whether the sale
was a hoax. The auction had described the merchandise as "the best
marijuana Holland has to offer". Seven bids, for amounts as high as $10
million, had been made before the auction was canceled. Kevin
Pursglove, A spokesman for eBay, said that while it can be hard to tell
whether sellers are serious about such auctions, the company will
usually play it safe and cancel any sales involving illegal goods. 
Earlier this month, in separate incidents, eBay executives shut down
auctions that claimed to be selling a human kidney and an unborn baby.

* Maryland fights out of state alcohol sales *
A new law in Maryland (U.S.) raises the penalty from misdemeanor to
felony for any out of state liquor or wine dealer that ships alcoholic
beverages into that state. It is part of a backlash against the
escalating number of Internet and catalog merchants skirting state
beverage taxes and sales restrictions. To operate on the Internet or
via catalog, out of state liquor sellers must negotiate state by state
agreements to sell alcoholic beverages. Most hurt by these state laws
and restrictions are smaller breweries and vineyards that don't have
the resources to negotiate such agreements.

* Sony's Walkman will be able to play pirated MP3 files *
Sony Electronics announced that a new version of its popular Walkman
personal stereo will be capable of playing music distributed in the MP3
file format (a popular digital music format). Although the new product
is designed to play files coupled with piracy protection technology, it
is also capable of playing any MP3 songs, including illegally copied
tunes. The Sony device will of course be able to play illegally copied
songs by Sony Entertainment artists, a situation Sony has been trying
to avoid in lobbying for tighter controls over the distribution of
digital music.

* Hackers plead guilty *
Three hackers, involved in one of the biggest computer security
breaches ever, pleaded guilty. The group's action caused damages of
approximately 1.85 million dollars. The hackers were sentenced to 24-41
months in prison. A full report, including details about FBI tactics
was published on ZDNet:,6061,2345639-2,00.html
Thanks to Mishpat Update reader, Boaz Guttmann, for pointing out this

* Haiti shuts down largest ISP *
Telecommunications d'Haiti (Teleco) Haiti's telephone monopoly, and the
National Telecommunications Council (Conatel), the government
communications regulator, charged Alpha Communications Network (ACN),
the largest Internet service provider (ISP) in Haiti, with violating
the Teleco monopoly by selling international telephone cards and
providing international telephone service. Saying the illegal activity
cost it $5 million in revenues per month, the government regulators and
Teleco took over and closed ACN's operating center. Among customers
that found themselves without service yesterday was the Haiti

* French army v. Apple's iBook *
Researchers from France's National Center for Scientific Research
warned that French buyers of Apple's new iBook notebook computer could
be in for a nasty surprise if they use the machine's AirPort wireless
transmitter for accessing the Internet. The device uses the same 2.4
GHz wave band reserved by the French military, meaning an iBook user
surfing the Web near an army unit could end up scrambling defense force
communications, and thus risk a 29,000 euro fine and six months in
jail.  Apple France's marketing director, said that since the
transmitting range between the iBook and AirPort is only 50 meters,
there should be no trouble getting permission from the French
authorities to use that frequency.,4586,2343332,00.html

* Yahoo faces legal problems in China *
Yahoo founder Jerry Yang said that there are still a number of "gray
areas" to be worked out with the Beijing government on the legality of
the company's new Internet venture in China. Yang said Yahoo is talking
to the Ministry of Information Industry and other regulators to ensure
that its mainland based Web site complies with all regulations. 
China's laws bar foreign investment in Internet service providers
(ISP), but such investment in Internet content providers (ICP) was
regarded as a gray area until last week. Minister of Information
Industry Wu Jichuan was quoted then as saying ICP investment is also

* Utah plans access fees *
Utah and other states plan to charge access fees from companies laying
cable for Internet and other telecommunications services along
interstate highways. Utah's Rights of Way Task Force recommended a one
time 500 dollar per mile charge. But Utah governor Michael Leavitt has
rejected the recommendation and has publicly suggested an annual fee of
1,000 dollar per mile. While telecom execs view the above cost fees as
a tax, other observers believe governments should charge for the right
to use public property.,4586,2341710,00.html

* Ninth Circuit to reconsider Bernstein crypto case *
The Ninth Circuit U.S. Court of Appeals ordered that the three judge
opinion in Bernstein v. U.S. Department of Justice be reconsidered by
the 11 judges of the court. As reported in Mishpat Update #10, in May,
the panel held by a 2-1 vote that computer source code is speech
protected by the First Amendment, and thus can be posted on the
Internet without government approval. The ruling found unconstitutional
U.S. Department of Commerce regulations requiring encryption software
makers to get a license to distribute encrypted material.

* Charges against alleged net child sex offender dropped * 
California prosecutors dropped charges against an alleged Internet
child sex predator citing a "lack of sufficient evidence." According to
John Forsyth, the defense attorney in People vs. Costello, the case
involved a sting operation in which a police officer posing as a minor
agreed to meet an adult, purportedly for sex. Under a California state
law, it is illegal for a person to knowingly transmit material over the
Internet to arouse or seduce a minor. Forsyth said the decision to
drop the case underscores deep flaws not only in this case but also in
the statute under which it was brought. According to Forsyth, the law
is barred by the Commerce Clause and the First Amendment. Nancy
O'Malley, Alameda Chief Assistant District Attorney, denied that the
case had been dropped because of doubts within the office about the
validity of the law.

* Barbie manufacturer sues porn web site *
Mattel, the world's largest toy maker, is asking a federal judge in New
York to shut down the pornographic web site Mattel
is accusing the porn site of using Barbie's trademark name and damaging
her image. Mattel, the maker of the real Barbie doll said it wants to
preserve the wholesome image it has cultivated for Barbie.

* Illinois passed anti spam law *
Illinois has passed the Electronic Mail Act, aimed at fighting
unsolicited email. The act sets statutory damages at a minimum of 10
dollar per spam message received, up to a maximum of 25,00 dollars per
day. The new law also fights spamming software, the Electronic Mail Act
makes it unlawful to distribute or possess software which enables
falsification of electronic mail transmission information or other
routing information. The full text of the law s available at:

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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