Internet & Online Law
This article provides a synopsis of the dynamic body of Internet and online law. The overview provides an introduction to the components of intellectual property law that have been most challenged by the rise of Internet usage, including copyright law, patent law and trademarks and domain names. This article examines central issues in Internet and online law, including questions surrounding the right to privacy, freedom of speech and transmission of spam. In addition, this article describes some of the factors affecting commerce conducted over the Internet, including contract formation, electronic signatures and taxation. Finally, brief examinations of areas emerging in Internet and online law are provided, including sections on pharmaceutical sales over the Internet, Internet voting systems and the electronic distribution and promotion of securities-related materials.
Keywords Click-wrap Agreement; Cookies; Copyright; Domain Name; Electronic Signature; Encryption; Shrink-wrap Agreement; Spam; Trademark
The world of Internet and online law is dynamic, expanding and increasingly important. As emerging technologies push the boundaries of the current legal landscape, courts and lawmakers are forced to consider the implications that arise from the intersection of laws and cyberspace, both in interpreting current laws and in drafting new laws and judicial decisions. Email and a virtual presence enables businesses of almost any size to compete in the global economy. However, these same capabilities raise questions about how commerce and information exchange over the Internet can effectively be regulated by law and the appropriate body of law that should regulate the online environment, especially when the reach of cyberspace crosses the traditional physical boundaries that divide nations, states and cities.
Today, lawmakers and the courts continually attempt to answer the difficult questions that frequently arise in the area of Internet and online law. But even as solutions to some questions are formulated, technological advances continue to generate even more difficult issues that will need to be addressed. The pace at which our current legal framework must be developed and adapted to new technological capabilities and business, scientific and medical possibilities is unmatched in the history of the world. However, by continuously looking to the basic constitutional rights and liberties that have remained a part of the U.S. legal system, courts and lawmakers have been able to create a body of Internet and online law that largely tracks the existing legal framework. Thus, a body of electronic law has evolved out of traditional legal principles that courts and lawmakers have extracted from legal precedents and applied to the issues raised by the Internet and online environment. The body of Internet and online law that has been created is well-integrated into the legal framework that has governed the U.S. since its inception.
The following sections provide a more in-depth explanation of these concepts.
Intellectual Property in the Online Environment
The major forms of intellectual property are trademarks, patents and copyrights.
- A trademark is a symbol, figure, name or mark that manufacturers and merchants use to designate their goods and distinguish them similar or competitive products.
- A patent is the exclusive right that an inventor may apply for and the government may grant so that inventors may manufacture, use or sell a product or process that they have invented for a certain number of years without the risk of a competitor copying their invention and profiting from it.
- Copyright is the legal right that the government grants to an author, composer or publisher to exclusive publication, production, sale or distribution of a literary, musical, dramatic or artistic work.
Intellectual property is protected on the Internet and in the online environment by a number of laws, some of which have been adapted from existing laws while others have been drafted exclusively to govern intellectual property issues in cyberspace. The following sections describe the copyright, patent and trademark protections that regulate the Internet and online environments.
Copyright laws protects a wide range of original works of authorship. While copyright law has long been associated with the protection of written words, such as books, magazine articles and poetry, copyright law also protects written words in the electronic environment, such as those that appear on websites and in software programs. In addition to written words, copyright laws also protect visual images such as photographs, pictures in digital formats (such as jpeg and gif) and art created with software programs. Finally, copyright law protects sheet music, recorded music on albums and compact discs as well as digital music files, such as mp3 formats.
A copyright is traditionally understood to mean that it is illegal to duplicate copyright-protected work without permission. However, copyright law provides many additional protections. The U.S. Copyright Act also gives the copyright holder the exclusive right to reproduce or perform the copyrighted work publicly or distribute copies of the work by sale, lease, lending or some other transfer of ownership. In addition, the copyright owner may also prevent others from doing any of these things. If the copyright protection is violated, the copyright owner may take legal action against the violator for copyright infringement.
Copyright infringement occurs whenever an idea or expression is copied, reproduced or distributed without the permission of the copyright holder. Copyright protections automatically arise under U.S. law when a work is created and fixed in a tangible medium, so the creator of an original work is not required to apply for a copyright to obtain legal protections. However, many authors and creators do file for copyright protections because the process establishes a public record of the copyright claim. In addition, an author or creator must generally obtain a copyright for original works before filing a copyright infringement lawsuit in court.
Digital Millennium Copyright Act
In the electronic environment, the Digital Millennium Copyright Act of 1998 (“DMCA”) established civil and criminal repercussions for those who bypass encryption software and various technological antipiracy protections. In 2000, a federal district court held that efforts to decrypting the encryption technology that has been created to protect digital creations such as movies, music and videos from illegal duplication or distribution violate the DMCA. Based on this ruling, record labels and other manufacturers and producers began to take more aggressive steps to prevent individuals from illegally copying or downloading digital and music files, including filing legal actions for injunctions and damages. In 2010 a series of exemptions were issued relating to some film DVDs, computer programs, video games, and e-books.
Digital Rights Management
Copyright protections on the Internet and online sites have also been enforced using various types of restrictive technologies. Digital rights management ("DRM") is an umbrella term that refers to technologies that companies or copyright owners install on electronic devices sold to the public that prevent certain access or misuse of the devices or digital data installed on it. However, DRM technologies have not been approved by the government for copyright protection purposes, and some DRM technologies may actually interfere with a user's ability to make certain legally permitted duplications of protected materials such as recording television programs or creating remixes of clips of songs and movies for personal consumption. Because DRM technologies often fall within the scope of the protections provided by the DMCA, individuals who take steps to circumvent DRM technologies even for permissible uses of electronic devices or digital files may still be in jeopardy of violating the DMCA. Courts and lawmakers are continuing to work with consumer groups, publishers and manufacturers to try to reach a better consensus on enforcing copyright protections while permitting fair use of new technologies.
A patent is essentially a contract between an inventor and the U.S. government, whereby the government agrees to prosecute infringements of the patent in exchange for inventors bringing new products to the American consumers. If inventors did not feel that their inventions would be protected and their investment in their efforts able to be recouped through profits from the sale of the product, investors would have fewer incentives to create exciting and innovative new products. Unlike a copyright or trademark, however, patent rights do not automatically arise upon creation of the underlying invention. Patent rights are only created if a patent application is filed with the U.S. Patent and Trademark Office and the application is ultimately granted.
Patent law has become increasingly significant with the rise of the Internet. For instance, both software and certain business methods may be protected by patents in the U.S. While software is also generally protectable by copyright law, there are differences between these two forms of protection. Copyright law requires that the protected subject matter be original, while patent law requires that it be novel and neither obvious nor an obvious variation of a prior patent.
Business-method patents are becoming increasingly used by Internet companies to protect innovative sales or service processes that are unique to a company or product. For instance, Amazon obtained a patent for its "1-click" payment process, whereby consumers may store payment, billing and shipping information on its database so that consumers only have to make one click on the appropriate hyperlink to complete a sales transaction rather than having to re-enter this information.
Because a patent only gives its owner the right to forbid others from making, using or selling the covered invention, owning a patent does not maximize the profits that inventors can recover from widespread distribution of their invention. Thus, many patent owners license the patent to others for a fee for permissible use of the invention in addition to enforcing the patent against misuse by suing violators for patent infringement. Because of these options, patent law in the online environment has become a very complex area for courts, lawmakers, companies and inventors. Patent infringement on the Internet is often costly to detect and prosecute. As a result, patent holders often opt to sell a license to individuals, competitors or even patent infringers for fair use of the patented design or product rather than litigating the dispute.
A trademark includes any word, name, symbol and/or device that is implemented by an individual to find and categorize his or her goods from those assembled and exchanged by others. Trademark infringement may occur online if an existing trademark is used on a competitor's products or website without permission. Because trademarks can be copied with ease using electronic files, trademark infringement can be more widespread and difficult to detect in cyberspace. In addition to trademark infringement, another abuse of trademark law in the online environment is trademark dilution, which occurs when a known trademark is placed on unauthorized goods and services, regardless of whether consumers would be confused by the misuse of the trademark. In 1995, Congress passed the Federal Trademark Dilution Act, which expanded the existing trademark protections by creating a federal cause of action for trademark dilution. Thus, holders of trademarks may use the federal court system to enforce their rights and intellectual property protections.
Not every word, name, symbol or device can function as a trademark, and some trademarks are stronger than others. There are generally five categories of trademarks that are separated by strength and uniqueness of the mark: "Fanciful, arbitrary, suggestive, descriptive and generic" (Kaufman, n.d., ¶13).
- "A fanciful trademark is one that is created for the sole purpose of functioning as a trademark, such as Xerox for reprographic supplies and Kodak for photographic supplies. Fanciful trademarks are the strongest trademarks because they are words that were invented to market a product and few competitors make a claim to the same trademark for their products" (Kaufman, n.d., ¶14).
- "Arbitrary marks are words that have some relevance to consumers but are not immediately associated with the products and are still generally strong trademarks. For instance, V-8 for vegetable juice, and Snickers for candy bars are arbitrary marks" (Kaufman, n.d., ¶15).
- "A weaker type of mark is known as the suggestive trademark. These trademarks generally describe or suggest some quality or character of the product they represent, such as Chicken of the Sea for tuna fish or Greyhound for transportation services. While suggestive marks are protectable as trademarks, descriptive marks generally are not protectable and thus are not enforceable against third parties" (Kaufman, n.d., ¶16).
- "Descriptive trademarks are those which describe some aspect, characteristic or quality of the products on which they are used, such as raisin-bran for bran cereal with raisins and yellow pages for organized telephone number listings" (Kauman, n.d., ¶17).
- "The final category of marks, namely generic terms, cannot constitute trademarks. The name of a product or service itself can never function as a trademark" (Kaufman, n.d., ¶19).
In the online environment, domain name violations now comprise a significant portion of trademark infringement cases. Domain names function similarly to trademarks in that domain names represent a product, company or service by providing an electronic address whereby online users may access information about the product, company or mirrors a corporate name or well known individual or organization for the purposes of later selling rights to the domain name at an inflated price, is probably the most prominent form of trademark violation on the Internet.
In deciding trademark infringement cases based in cyberspace, courts consider a number of factors, including the strength of the trademark, the similarity of the trademark to the domain name, the degree of actual confusion and the intent of the domain name registrant in choosing the domain name. However, these factors are open to interpretation and often there are no clear cut answers to alleged trademark violations in cyberspace. Courts are still struggling with how to apply traditional trademark infringement law in the context of the Internet and online environment.
Key Issues in Internet
The exponential growth of the Internet for personal correspondence, electronic commerce, marketing and networking has given rise to growing concerns about the rights to privacy for the millions of individuals who access and use the World Wide Web. Every time a user visits a Web site, an electronic trail is created that includes personal demographic information about the user and the computer used to access the Internet. Some businesses gather and track this information using computer files called cookies, which are portions of text delivered by a server to an Internet browser and then given back untouched by the browser every time it approaches the server. This capacity to track Internet usage has raised concerns that businesses will compile and use the information for commercial purposes without the consent of individuals.
Privacy policies for online services such as Google and social networks like Facebook have come under increasing scrutiny in the 2000s for issues such as search history, e-mail privacy, user information, and targeted advertizing. Issues with online privacy increasingly relate to things like cyberstalking, identity theft, social profiling, and location disclosure. The US government and the National Security Advisory (NSA) under President Barack Obama even made news for data spying in 2012 and 2013.
Although privacy is generally regarded as an important interest, both in the online environments and as an individual right, the United States Constitution does not contain an express or enumerated right to privacy. Thus, current privacy protections have been derived from implied rights...
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