e-commerce LAW & STRATEGY - Heymann & Partner, Rechtsanwälte

LAW JOURNAL 

NEWSLETTERS 

On the Razr’s 

Edge: Mobile 

Marketing 

Be Careful to Whom, 

And How, Your Mobile 

Campaign Is Directed 

By Luis Salazar 

You can see it and read about 

it everywhere: mobile-phone ad 

campaigns are the new frontier 

in marketing. 

Mobile marketing offers the 

best in advertising — a direct, 

personal, measurable and dynamic 

means of engaging, informing, 

and entertaining consumers. In 

fact, there are more than 2.4 billion 

mobile-phone subscribers 

worldwide exchanging over 350 

billion text messages each month, 

with an estimated 15% of those 

classified as commercial or marketing 

messages. 

But this mobile advertising 

frontier is hardly the Wild West. 

Plenty of federal and state laws 

regulate this direct-marketing 

vehicle. More than that, various 

industry groups — most notably 

the Mobile Marketing Association 

(“MMA”) — have developed best 

practices designed to maximize 

advertising impact while minimizing 

potential legal entanglements. 

While the rewards of mobilephone 

campaigns can be rich, 

it’s important not to lose sight of 

these restrictions. 

This article reviews some of 

the critical legal issues marketers 

should be aware of, and reviews 

the industry’s best practices. 

continued on page 6 

e -commerce 

L A W & S T R A T E G Y ® 

Sale of Used Software Licenses in Germany 

Federal Court Expected to Decide a Hot Issue Soon 

That Will Affect Europe 

By Dr. Katharina Scheja 

Volume 24, Number 2 • June 2007 

Once in a while, something known as “new distribution forms” of software 

catch the attention of people in the tech market in Germany. But standard 

license agreements and provisions of German copyright law do not always 

match perfectly, and these discrepancies give rise to gaps and misunderstandings 

that courts must ultimately settle. 

Accordingly, a couple of landmark decisions have come down from the 

Bundesgerichtshof (“German Federal Court”) over the last few years. While the German 

Federal Court has refused to accept the once famous original equipment manufacturer 

(“OEM”) clause that set forth restriction of stand-alone sale of software without hardware 

in 1999 (BGH, July 6, 2000, File Number I ZR 244/97 (OEM)), it has decided, on 

the other hand, that network licenses must be accepted as a permissible use of software 

licenses (BGH Oct. 24, 2002, File Number I ZR 3/00 (CPU)). Even though these license 

forms have been subject to Federal Court evaluation, other concepts to circumvent 

software-licensing restrictions have come up, and have yet to be decided. 

RESELLING USED SOFTWARE LICENSES 

A hot topic in such licensing restrictions concerns the resale of “used” licenses. 

Since the Federal Court has decided that the stamped restriction on a Microsoft OEM 

product “for sale with a new PC only” is void under German law, the sale of fullpackaged 

software products cannot be made subject to usage restrictions if contractual 

provisions between customer and licensor have been put in place that aren’t 

valid (which is not typical). Such restrictions are not in line with the exhaustion 

principle as defined in §69 c Urhebergesetz (German Copyright Act) — a provision 

incorporated from the EU Software Directive (Directive 91/250/EWG) and is in force 

throughout Europe. The prohibition of distribution restrictions, however, once a 

work has been released to the market, applies only to physical incorporations of 

the work, according to the law’s literal wording. The question arises, though: Does 


In This Issue 

Sale of Used Software 

Licenses in Germany .1 

On the Razr’s Edge: 

Mobile Marketing . . .1 

When the CEO 

Wants His ‘Hotmail’ . .3 

Internet Expands 

Trademark 

Infringement . . . . . . .7 

e-Commerce 

Docket Sheet . . . . . .10 

Movers & Shakers . .11

Used Licenses 

continued from page 1 

this principle also apply, if for example, 

rights, but not products, are 

being sold? 

Yes is the answer, and some distributors 

have started to distribute 

freely defined numbers of application 

licenses purchased from a bulk 

of volume license agreements that 

their resellers (the first users) purchased 

from software manufacturers 

such as Microsoft and Oracle, but 

allegedly no longer need. 

An approach some others take is 

to “transfer” replication rights for 

software that the first customer was 

offered via download, has used, and 

then deletes and issues a sales document 

to the distributor — who then 

resells the “license.” Apparently, this 

approach makes use of some significant 

price deviations between fullpackaged 

product and software 

licenses that are priced more favorably 

as part of either volume license 

agreements or download offers. In 

the end, software manufacturers 

haven’t left the issue unattended, and 

have begun involving the courts, 

which have had to deal with this 

business model and have come to 

different conclusions. One can 

expect, then, that the Federal Court 

will have to decide the question. This 

article provides an overview of 

German precedents in the matter. 

ORACLE V. USEDSOFT GMBH 

Last year, the Munich Court of 

First Instance (Landgericht München, 

Jan. 1, 2006, File Number 7 0 

23237/05) and the Appellate Court 

(Oberlandesgericht München, Aug. 3, 

Dr. Katharina Scheja is a partner 

in the IT/IP Services Department 

of Heymann & Partner, Frankfurt, 

Germany. Dr. Scheja specializes in 

large IT transactions such as software 

and telecom projects, development, 

distribution and licensing contracts and 

outsourcing. She has also been active 

in anti-piracy. Among her memberships, 

Dr. Scheja counts the German 

Association for Computer Law and the 

German Association on IP Law. She 

joins the e-Commerce Law & Strategy’s 

Board of Editors with this issue. Reach 

her at k.scheja@heylaw.de. 

2 

2006, File Number 6 U 1818/06) decided 

a case brought by Oracle against 

software reseller usedSoft GmbH 

(“usedSoft”). The case dealt with software 

that Oracle offered via the 

Internet by download to its customers. 

usedSoft sold “used licenses” of this 

software to customers who had physical 

copies of the software and intended 

to enlarge their license portfolio, 

with the “licenses” having been purchased 

by the first customers who had 

downloaded the software from the 

Internet. The “transfer of license 

rights” was documented in a certified 

brief issued by a German notary public 

who verified having checked the 

delivery papers of the original license 

owner and the delivery to usedSoft, 

and confirmed that the original license 

owner had obtained the licenses legally, 

and did not continue to use them. 

Oracle argued that this offer of 

“used licenses” was infringing its 

copyright because Oracle hadn’t 

agreed to the transfer. Oracle 

applied for a preliminary injunction 

to cease and desist, and further 

refrain from, this offer. The Munich 

Court of First Instance granted the 

preliminary injunction, with the 

Appellate Court in Munich affirming 

the ruling. After that, in accordance 

with provisions of German 

Procedural Law, Oracle had to initiate 

main proceedings in which the 

legal issues would be checked thoroughly, 

and subject to collection and 

discussion of further facts and evidence. 

The Landgericht München 

this year upheld its earlier decision 

(see, Landgericht München, March 

15, 2007, File Number 7 O 7061/06). 

In their decisions, both Munich 

courts asserted that the exhaustion 

principle could not be applied to the 

resale of licenses and, accordingly, 

such resale needed the consent of 

the software manufacturer to be 

valid. In accordance with the wording 

of the law, both Munich courts 

clearly stated that the principle of 

exhaustion applies only to physical 

incorporation of protected works. 

These decisions have received 

enormous attention and been subject 

to intense discussion in the 

legal community. One of the most 

intensely discussed topics in German 


e-Commerce Law & Strategy ❖ www.ljnonline.com/alm?ecomm 

e-commerce 

LAW & STRATEGY ® 

EDITOR-IN-CHIEF . . . . . . . . . .Michael Lear-Olimpi 

EDITORIAL DIRECTOR . . . . . .Wendy Kaplan Ampolsk 

MANAGING EDITOR . . . . . . . .Steven Salkin, Esq. 

MARKETING DIRECTOR . . . . .Jeannine Kennedy 

MARKETING 

COORDINATOR . . . . . . . . . . . .Beth Ann Montemurro 

GRAPHIC DESIGNER . . . . . . . .Louis F. Bartella 

BOARD OF EDITORS 

RICHARD BUCHBAND . . . .Juno Online Services Inc. 

New York 

JEFFREY P. CUNARD . . . . . .Debevoise & Plimpton 

Washington, DC 

WALTER A. EFFROSS . . . . . .American University 


D. REED FREEMAN JR. . . . .Claria Corp. 


ELIZABETH A. GAUDIO . . .Nat’l Federation of Ind. Bus. 

Legal Foundation 


PAUL R. GUPTA . . . . . . . . . .Mayer, Brown, Rowe & Maw 

New York 

THOMAS HEYMANN . . . . . .Heymann & Partner 

Frankfurt, Germany 

STANLEY P. JASKIEWICZ . . .Spector Gadon & Rosen, P.C. 

Philadelphia 

PHILIPPA LAWSON. . . . . . .Canadian Internet Policy and 

Public Interest Clinic 

Ottawa 

EMILE LOZA . . . . . . . . . . . .Technology Law Group 

Boise, ID 

RONALD J. MANN . . . . . . .Mitts Milavec 

Philadelphia 

JULIAN S. MILLSTEIN. . . . . Thelen Reid Brown Raysman 

& Steiner LLP 

New York 

JEFFREY D. NEUBURGER. . .Thelen Reid Brown Raysman 

& Steiner LLP 

New York 

EDWARD A. PISACRETA. . . .Thelen Reid Brown Raysman 

& Steiner LLP 

New York 

LUIS SALAZAR . . . . . . . . . .Greenberg Traurig LLP 

Miami 

DR. KATHARINA SCHEJA . . .Heymann & Partner 

Frankfurt, Germany 

J.T. WESTERMEIER, JR. . . . .DLA Piper Rudnick Gray Cary 

Northern Virginia 

JOSEPH P. ZAMMIT . . . . . . .Fulbright & Jaworski 

New York 

e-Commerce Law & Strategy® (ISSN 0747-8933) is published 

by Law Journal Newsletters, a division of ALM. 

© 2007 ALM Properties, Inc. All rights reserved. No reproduction 

of any portion of this issue is allowed without written permission 

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Circulation e-mail: almcirc@alm.com 

The publisher of this newsletter is not engaged in rendering 

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professional services, and this publication is not meant to 

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services of a competent professional person should be sought. 

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www.ljnonline.com 

June 2007

When the CEO 

Wants His ‘Hotmail’ 

Don’t Treat Your Business 

Records Like Presidential 

Correspondence 

By Stanley Jaskiewicz 

Many businesses today are conducted 

entirely by e-mail, sometimes 

through employees’ individual e-mail 

accounts. 

And you’ve most likely been in this 

spot: Often, the only place to find correspondence, 

contracts and other 

business records is in the electronic 

inboxes of everyone who works for a 

company. 

This is certainly convenient, 

because it lets all employees who 

need materials in their inboxes keep 

working, wherever they may be, without 

being tethered to a particular 

office and or cabinet full of paper files. 

But despite the convenience of 

working online, wouldn’t it be nice to 

have the luxury of an old-fashioned 

secretary to clean up your firm’s 

inboxes? Someone would maintain the 

traditional files, to store all messages 

arranged by client, subject and date. 

When something is needed, whether 

because a question arose about what 

a contract requires, a request is 

received to produce documents in ediscovery, 

or a copy of the latest or 

final draft of a contract is needed, 

it would be a simple matter of 

asking the secretary to assemble messages 

from that neatly sorted file. 

(Sophisticated document-management 

systems purport to create this result, 

but they are only as good as the documents 

that make it into the system. 

For reasons discussed in this article, 

many documents and e-mail messages 

might never make it there.) When all 

Stanley P. Jaskiewicz, a business 

lawyer, helps clients solve e-commerce, 

corporate contract and technology-law 

problems, and is a member 

of e-Commerce Law & Strategy’s 

Board of Editors. He can be reached 

at the Philadelphia law firm of 

Spector Gadon & Rosen P.C., at sjaskiewicz@lawsgr.com. 

business correspondence took place 

on paper, in a 9-to-5 work world, that 

system made perfect sense. 

Unfortunately, that world (and its 

secretaries) hasn’t existed for many 

years. Not only do most of us not 

have a secretary tidying up our email 

inbox each evening, but we also 

have many alternative inboxes for 

our business correspondence. For 

work, a busy executive may have an 

office e-mail account, a Blackberry 

for around-the-clock access and an 

online mail account (such as through 

Gmail, Hotmail or Yahoo!) for convenience 

when traveling. He or she 

probably also has a personal account 

for non-business e-mail that must be 

kept out of the firm’s accounts. 

Going through “the file” has become 

an exercise not only in finding the 

appropriate messages and attachments, 

but in simply identifying all 

places and accounts where “the file” 

might exist. Indeed, multiple accounts 

often are created by employees to 

bypass the hassles of security measures 

and record-retention policies 

diligently created by IT departments 

who often diligently enforce these 

polices and whose employees read 

and apply the information in publications 

like this one. (My IT staff 

would call those hassles “necessary 

inconveniences” to comply with the 

rules that lawyers perpetrate.) If the 

most convenient e-mail device — 

typically the Blackberry — is supplied 

by the employee herself, or by 

a third party, then the IT department 

might not know about all the 

accounts on which it is used, much 

less be able to monitor them, or 

apply the firm’s retention or other 

policies. 

Yet the rabbit-like multiplication of 

e-mail accounts has grave implications, 

not only for business, but, as 

we have seen in recent news, for 

anyone who uses e-mail — including 

even our government leaders. The 

pitfalls recently encountered by the 

politicos who apparently tried to 

keep secret their machinations about 

the replacement of various U.S. 

Attorneys, and dealings with lobbyists, 

by using private Republican 

National Committee (“RNC”) 

accounts, rather than White House 

e-mail accounts — with all their 

monitoring, recordkeeping and other 

oversight — mirror the risks businesses 

run when they allow employees, 

especially key employees, to 

bypass the company e-mail system. 

(See, http://online.wsj.com/article/ 

SB117651545625969906.html?mod= 

googlenews_wsj; http://online.wsj. 

com/article/SB117615846511864432search.html?KEYWORDS=congress+f 

ollows+e-mail+trail&COLLEC- 

TION=wsjie/6month; and www.salon 

.com/opinion/blumenthal/2007/03 

/29/attorney_firings/.) The RNC’s email 

pratfalls provide an instructive 

lesson on what not to do when private 

businesses allow (or tolerate) an 

employee’s alternative online account, 

rather than the “official” employersanctioned 

one. 

RECENT DEVELOMENTS 

Even worse, consider how the 

White House’s and RNC’s problems 

with outside e-mail — and their 

staffers’ actual quotes about it — 

would appear if the situation involved 

your company, or a client’s, and you 

had to read about your employees 

and IT department defending your 

company’s e-mail snafus, using the 

same language as the widely reported 

actual quotes cited below. How it 

would play in the press and the concerns 

of unhappy clients would be 

the least of your worries, particularly 

compared to your legal headaches. 

You could have to give explanations 

to opposing counsel conducting discovery 

(and feeling misled by your 

formal responses), or worst of all, 

respond to subpoenas if the “alternative” 

e-mails trigger a regulatory 

investigation. (The following quotes 

all are actual statements reported in 

the press, but any of them could easily 

have come from well-meaning and 

bottom-line oriented employees — or 

IT staff who simply have not had adequate 

training on legal issues in 

records management, particularly as it 

applies to electronic records.) 

For example, an assistant to presidential 

advisor Karl Rove said in an 

e-mail (that was widely quoted in 

The Wall Street Journal, and other 

publications): “I now have an 

RNC blackberry which you can use 


June 2007 e-Commerce Law & Strategy ❖ www.ljnonline.com/alm?ecomm 

3

‘Hotmail’ 


to e-mail me at any time. No security 

issues like my WH (White House) email.” 

Would your IT department tolerate 

that attitude from a staffer 

unhappy with the rules of your 

record-retention program or acceptable-use 

policy? Certainly not, since 

the reaction of opposing discovery 

counsel, or a court, might mirror that 

of the legislators who investigated 

the RNC, such as Rep. Henry 

Waxman (D-CA), who bluntly (but 

accurately) described the behavior of 

the White House staffers as “using 

the nongovernmental accounts 

specifically to avoid creating a record 

of the communications.” He also 

cited an instance in which a lobbyist 

had warned against using the “official” 

White House e-mail system, 

because “to put this stuff in writing in 

their e-mail system ... might actually 

limit what they can do to help us.” A 

Clinton-era staffer with similar clarity 

labeled this behavior as “operating 

official business off the official systems” 

— the very risk run by private 

firms that allow use of personal email 

accounts for business. From a 

practical perspective, you would be 

lucky if an opposing counsel finding 

any of these land mines in discovery 

gave you a chance to call your carrier 

to discuss settlement before seeking 

sanctions from the court. 

HOW ‘CONVENIENCE’ 

CAN CAUSE PROBLEMS 

In an era when firms adopt carefully 

drafted record-retention policies, 

and e-mail and Internet-usage, 

policies to protect the firm against 

improper use of those resources by a 

rogue employee, allowing your 

firm’s staffers and executives alike to 

bypass those protections, like the 

White House officials, would make it 

hard to persuade a court to grant 

your firm the benefits of those policies. 

After all, the White House and 

RNC had to cope only with the 

requirements of the 1978 Presidential 

Records Act, which requires that sufficient 

records be kept “to assure that 

the activities, deliberations, decisions, 

and policies that reflect the 

performance of (the President’s) con- 

4 

stitutional, statutory, or other official 

or ceremonial duties are adequately 

documented and that such records 

are maintained” (www.archives.gov/ 

about/laws/presidential-records. 

html). 

Private businesses, in contrast, 

must adhere to the stringent 

demands of Sarbanes Oxley and 

other regulatory acts — not to mention 

the after-the-fact scrutiny of the 

class-action plaintiffs’ bar. 

In particular, the recently adopted 

amendments to the Federal Rules of 

Civil Procedure (“FRCP”) impose 

strict standards for the storage and 

destruction of e-mail, and duties to 

produce it in litigation. With all of 

this alternative e-mail, it is fortunate, 

on the one hand, that the rules do 

not impose a duty to locate every 

possible electronic record, such as a 

critical e-mail that is not on the firm’s 

own system. “A party need not provide 

discovery of electronically 

stored information from sources that 

the party identifies as not reasonably 

accessible because of undue burden 

or cost.” On the other hand, however, 

the rules’ protection for those 

unable to produce relevant information, 

particularly that which has been 

destroyed or which is not maintained, 

do not provide a defense for 

casual failure to maintain records. 

“Absent exceptional circumstances, a 

court may not impose sanctions 

under these rules on a party for failing 

to provide electronically stored 

information lost as a result of the 

routine, good-faith operation of an 

electronic information system.” 

(Emphasis added.) If a firm knowingly 

permits those generating potential 

evidence — that is, everyone in 

the business who uses e-mail — to 

avoid the firm’s own systems for 

assembling that evidence, whether 

intentionally or not, then those 

defenses might be unavailable. The 

oversight might have been what 

many people responding to inquiries 

about the oversight would call “routine,” 

but almost certainly not “good 

faith operation.” No one wants to fall 

into such a fact-specific question as 

to whether the cost of not requiring 

every employee to adhere to a 

record-retention policy requiring use 


of the company’s own e-mail system 

was an “undue burden.” 

In fact, beyond the impact of the 

new rules, consider the practical burdens 

on an IT department facing a 

discovery demand, if use of the firm’s 

information-management software, 

systems and procedures is “optional” 

for those who prefer not to deal with 

it, and instead choose to use a 

personal e-mail address outside 

the system for their business correspondence. 

As mentioned above, 

responding to discovery requests 

might require assembling information 

from outside providers, either 

voluntarily (such as by requiring the 

employee to back up everything 

from the outside system into the document-management 

system), or by 

subpoena to a third party (at an 

unnecessary expense). Busy employees 

might not even keep copies of 

recent e-mail, much less of older correspondence. 

Implementation of a 

retention policy cannot be handled 

on a single server, as the IT staff may 

prefer, but will require them, at a 

minimum, to clean manually the 

memory of each affected user’s computer 

to eliminate records of saved 

mail. Of course, that work won’t 

purge anything from the service 

provider’s own servers and stored email 

— all of which an adverse party 

can obtain with relative ease — or 

from employees’ home computers or 

laptops that haven’t been synchronized 

with the system. 

THINGS CAN GO 

BUMP IN THE NIGHT 

IT management also becomes a 

nightmare. Monitoring employees’ 

communications for objectionable 

content or activity, or for unauthorized 

transmission of proprietary 

information, becomes something like 

trying to catch raindrops with a sieve. 

Restoring data after a disaster, or 

locating the work of an employee 

who maybe left the firm before data 

was needed for litigation, becomes 

problematic. Data restoration assumes 

that the IT department can reconstruct 

all of the third party e-mail 

sources that the departed staffer 

used (whether or not the former 

employee shared that information, 


June 2007

‘Hotmail’ 


and passwords, with tech support), 

and obtain access to them (perhaps 

without passwords or subscriber 

IDs). Even scrupulous staffers who 

keep different accounts to separate 

work and personal e-mail may err at 

times, and use the personal account 

for business (and provide an opening 

for opposing counsel’s discovery 

fishing expedition). 

In fact, even so-called normal business 

can be compromised when 

employees rely on alternative e-mail 

services, whether an online one, or 

private accounts such as an AOL 

address. Such services often have limits 

on the size and types of messages 

that can be transmitted; a company 

account can also have limits, but at 

least the company can set them to 

permit the size and type of messages 

typically encountered in the business. 

While normal text messages would 

rarely be blocked for exceeding the 

permitted limits, attachments of the 

size common today — such as multimedia 

or .PDF files — may well be 

prohibited. While these limits can be 

worked around by breaking the file 

into smaller chunks, it is certainly less 

convenient. Worse, a critical message 

might be delayed or bounced unexpectedly. 

At best, time may be lost 

until the sender gets the error message, 

and arranges another way of 

sending it; at worst, business opportunities 

may be lost, or key dates 

missed. 

Another problem could occur when 

the company loses control of critical 

business information because that 

information is outside the company’s 

records and control. Channeling all 

work through a company-controlled 

account at least preserves the firm’s 

access to critical information, such as 

contact data for those with whom the 

employee — and her successors — 

must correspond. Customers and vendors 

might send business-related messages 

— or orders — to an employee’s 

own address, which the company 

might never see if the employee 

leaves, or chooses not to forward 

back to her former employer. Worse 

yet, those messages might be formal 

notices given under a contract — 

rarely a harbinger of good news — 

that require immediate action, which 

never comes because no one saw the 

message. The inability to monitor 

employee e-mail could be a particular 

concern with a disloyal employee, 

who might be contemplating leaving 

for a competitor because confidential 

information could go out the door 

unrestricted by any oversight software 

the company might have in place. 

(Again, alternative e-mail might be 

only the tip of the iceberg in protecting 

electronic assets — a determined 

thief could do the same damage with 

a $10 flash drive, or an omnipresent 

iPod holding business data rather than 

music on its massive hard drive.) At a 

minimum, using a “company” address 

for all formal notices, rather than an 

employee’s home address, could prevent 

some of these problems (as long 

as someone is checking the “notice” 

e-mail inbox regularly). 

INVENTION CAN BE THE 

MOTHER OF NECESSITY 

Yet there might be legitimate reasons 

for employees to occasionally 

use outside e-mail accounts for business, 

or at least to have them available 

as needed. During potential outages 

of the firm’s servers, whether 

due to technical bugs or natural 

problems (such as storm or power 

outage), an alternative e-mail 

account (despite the possible costs it 

may create for IT management and in 

litigation) is a much cheaper backup 

system than paying the certain costs 

of maintaining a full-blown backup 

capability 24/7. Traveling employees 

might find it easier to connect in 

public places or hotspots to an 

online account than to find an 

Internet provider capable of allowing 

access to the firm’s secure network 

through a protected connection 

(especially when traveling in remote 

areas where any Internet connection 

is welcome). Some employees might 

not have sufficient hardware or 

bandwidth to access the company email 

from home, so online accounts 

let them work during evenings and 

weekends despite those limitations. 

Of course, these arguments can be 

nothing but rationalizations — in the 

RNC case, the White House claimed 

that the RNC accounts had been created 

“to avoid using government 

resources for political purposes,” 

while its Democratic opposition saw 

the only purpose of the accounts as 

“an attempt to avoid scrutiny” when 

employees were discussing matters 

such as the firing of U.S. Attorneys. 

Also, just announcing a policy 

requiring that all e-mail be done 

through an account provided by the 

firm might not be enough to dissuade 

the CEO who really wants his 

or her Hotmail. For example, in the 

RNC case, the existence of a federal 

law, and oversight by the lawyers 

employed by the White House, was 

not enough to stop the human 

instinct to get business done in the 

easiest, cheapest, way, and the way 

that appears to be least regulated. It 

is human nature to do what must be 

done today — using a non-company 

e-mail account — and sort out the 

ramifications later. 

Similarly, even with policies in 

place to direct messages into the 

“official” e-mail, those who really 

want to avoid creating a record can 

simply turn to the “traditional” lowtech 

ways of avoiding leaving a trail 

of their activity. Crooks have always 

known to hold live conversations, 

face to face, rather than put something 

in writing (including an e-mail) 

or to speak on a phone (or leaving a 

voice-mail message) that might be 

recorded. (Voice-mail discovery itself 

has become a rapidly emerging discipline.) 

Policies against online 

accounts, then, simply become a way 

to educate unsophisticated employees 

who don’t know the problems 

created by the convenience of not 

using the firm’s systems, and to discourage 

them from such activity. 

WHEN IN DOUBT, 

JUST DON’T DO IT 

The RNC’s problems also highlight 

the importance, in an era of virtually 

perpetual storage of electronic 

communications and enhanced discovery 

rights under the recently 

revised federal rules, of simply not 

creating unnecessary documents: Just 

because it might be easier to e-mail 

someone, it may nonetheless not be 

wise, especially if a phone call will 



5

Used Licenses 


copyright law is whether the distinction 

between physical incorporations 

and rights can still be upheld, and 

whether such a decision is justified in 

light of technical progress and the 

economic interests of consumers and 

businesses. In its thoroughly reasoned 

decision this year, the Munich 

Court of First Instance deals with 

these arguments in detail and says 

that the right-holders’ interests, for 

several reasons, can be properly protected 

only if physical works are 

treated differently from how license 

rights are treated, with one of these 

reasons being not only legitimate 

financial interests, but also necessary 

protection from pirated copies. 

Again, the judgment of the Munich 

Court of First Instance has been 

appealed, and once more it is up to 

the Oberlandesgericht to re-evaluate 

its earlier findings. It would be more 

than a surprise, however, if the 

Appellate Court deviates from its first 

decision and then — economic interests 

apparently being strong on both 

sides — the case certainly will go to 

the Federal Court and be decided 

soon, particularly as in Germany’s 

northern territories, courts have 

shown a partly different view. 

HAMBURG COURT DECISIONS 

ON AD FOR USED LICENSES 

While the Munich decisions rendered 

support to the software manufacturers’ 

position regarding transfer 

of software licenses, they suffered 

a setback in Hamburg. The First 

Instance Court in Hamburg 

(Landgericht Hamburg, June 29, 2006, 

Mobile Marketing 


IS IT E-MAIL OR A CALL? 

Two different regulatory structures 

apply to mobile-marketing campaigns, 

depending on whether the 

campaign emphasizes phone or email 

messages. If your marketing message’s 

destination is an e-mail address 

— the traditional @ with a domain 

name — then treat it as an e-mail; but 

if a telephone number is the destination, 

then consider it a phone call. 

6 

File Number 315 O 343/06) had to 

decide on a case that a software dealer 

for Microsoft products brought 

against usedSoft (same defendant as 

in the Munich case). The plaintiff 

apparently felt pressured economically 

by usedSoft’s aggressive advertisement 

for the business model of used 

licenses, and filed for a preliminary 

injunction to prohibit this advertisement, 

which allegedly promoted a 

prohibited business. Microsoft was 

not a party to the case. 

In light of the Munich decisions, the 

Hamburg Court of First Instance surprisingly 

rejected the application and 

held that the business model of resale 

of “used” licenses does not infringe 

provisions of the copyright act. The 

Hamburg court applied the exhaustion 

principle and found that the resale of 

such licenses could not be restricted 

and does not require Microsoft’s consent. 

Advertisement for this business 

model, then, was not considered to be 

promoting illegal activity. 

The decision was confirmed by the 

Appellate Court (Hanseatisches 

Oberlandesgericht, Feb. 2, 2007, File 

Number 5 U 140/06), but the Court 

moved away from the application of 

the exhaustion principle and 

declared (probably in an attempt to 

avoid open collision with the Munich 

Court of Appeals) that the case needed 

only application of the provisions 

of fair advertisement in the law on 

unfair competition. Considering 

these provisions, advertisement for a 

business model could not be objected 

to if it fairly mentioned the legal 

dispute so that customers knew the 

potential risks. This declaration is in 

principle fully in line with the gener- 

If it’s an e-mail, then your campaign 

will be governed by the Controlling the 

Assault of Non-Solicited Porno- graphy 

and Marketing Act, (“CAN-SPAM”) (15 

U.S.C. §7701-7713) and the Federal 

Communications Commission’s Wireless 

E-mail Rule (64 C.F.R. §64.3100). 

If it’s a telephone call, then it will 

be governed by the Telemarketing 

and Consumer Fraud and Abuse 

Prevention Act (“TCFAP”) (15 U.S.C. 

§6101-6108), the Telephone Consumer 

Protection Act (“TCPA”) (47 U.S.C. 

§227) and, of course, the Tele- 


al requirements of advertisement 

law, but it is highly doubtful whether 

usedSoft has really mentioned the 

legal disputes (at all) and in a way 

that informs customers about the critical 

issue — whether purchasing 

such licenses means obtaining anything 

at all. If the Munich decisions 

should be upheld, all such “used” 

license transactions are void, if the 

consent of the rightholders cannot be 

established. In such a case, customers 

would be left with a compensation 

claim against usedSoft but 

could be subject to prosecution by 

software manufacturers. 

CONCLUSION 

The Hamburg decisions and their 

contradiction of the Munich courts’ 

view will require the Federal Court to 

decide quickly, once the Munich 

case is handed over to the Federal 

Court. The legal community and the 

market participants eagerly await the 

decision. It will likely be a landmark 

decision on the exhaustion principle 

as laid down in the Software 

Directive. But there are more questions 

in the package, such as the crucial 

question of under which conditions 

the consent of software manufacturers 

to such transfer of license 

has to be declared — a subject that 

will depend on a competition-law 

evaluation of fair and equal treatment 

of applicants, as well as of 

requirements of transparency in 

license contracts. 

It’s not a certainty that the Federal 

Court will answer all these questions, 

but it is a certainty that the decision will 

receive interest throughout Europe. 

—❖— 

marketing Sales Rule (“TSR”) (16 CFR 

§310.1 et seq.), along with the Do 

Not Call Registry that the Federal 

Trade Commission (“FTC”) maintains 

and the Federal Communications 

Commission (“FCC”) enforces. 

E-MAIL REGULATIONS 

As with e-mails more generally, 

CAN-SPAM will govern text, or SMS 

(short message service) messages, 

and MMS (multi-media messaging 

services), which typically contain 

graphics, video or an audio 


June 2007

Internet Expands 

Trademark 

Infringement 

Novel Trademark Claims 

Spring from e-Commerce 

By Jonathan Bick 

It should strike no one as a surprise 

that the fluidity of using trademarks 

on the Internet expands the 

incidence of trademark-infringement 

claims and lawsuits. And along those 

lines, novel Internet trademark 

claims spring from the innovative but 

unlawful use of trademarks in e-commerce. 

Logically, then, it follows that 

Internet domain names, hyperlinks, 

meta tags and framing marks enlarge 

the number of trademark-infringement 

opportunities. 

While it’s true that as an information 

conduit, the Internet reduces the 

likelihood of confusion by allowing 

the buyer to approach an online purchase 

with more sophistication, the 

technology also bolsters the likelihood 

of confusion among consumers 

using the Internet by allowing new, 

unlawful uses of trademarks. Also, 

the traditional use of a mark on the 

Internet (to identify the source of 

goods) is likely to amplify certain 

trademark characteristics, including: 

• The strength of a mark; 

• The proximity of the products or 

services to a geographical location; 

and 

• Actual confusion. 

TRADEMARK PARTICULARS 

Trademarks connect a name or 

symbol with a good or service. They 

benefit owners by allowing them to 

profit from the goodwill associated 

with the mark. On the other side of 

the potential or actual transaction, 

trademarks benefit consumers by 

Jonathan Bick is of counsel to 

WolfBlock Brach Eichler of Roseland, 

NJ, and is an adjunct professor of 

Internet law at Pace Law School and 

Rutgers Law School. He is also the 

author of 101 Things You Need To 

Know About Internet Law (Random 

House 2000). He can be reached at 

bickj@bicklaw.com. 

memorializing a level of quality. U.S. 

trademark law is designed to prevent 

confusion in the marketplace and is 

enforced by preventing fraud 

through deception. 

The elements necessary to prove 

trademark infringement are well 

established under federal and state 

case law. These elements apply to 

Internet and traditional trademark 

infringement. A plaintiff in a trademark-infringement 

matter has the 

burden of proving that the defendant’s 

use of a mark has created a 

likelihood of confusion about the origin 

of the defendant’s goods or services. 

This proof is achieved by the 

plaintiff first showing that it has 

developed a trademark right worthy 

of protection, and then showing that 

the defendant is using a confusingly 

similar mark in such a way that it creates 

a likelihood of confusion, mistake 

or deception — or a combination 

of these misapplications — 

among the consuming public. 

Poloroid Corp. v. Polorad Elec. 

Corp., 287 F.2d 492 (2d Cir. 1961), 

details eight factors that a court must 

evaluate prior to finding that an entity 

has used a trademark in such a 

way that would result in a likelihood 

of confusion in the mind of a consumer 

regarding the source of a 

product. They are: 

1. The strength of the plaintiff’s mark; 

2. The degree of similarity between 

the plaintiff’s mark and defendant’s 

mark; 

3. The proximity of the products or 

services; 

4. The likelihood that the plaintiff 

will bridge the gap; 

5. Evidence of actual confusion; 

6. The defendant’s good faith in 

adopting the mark; 

7. The quality of defendant’s product 

or service; and 

8. The sophistication of the buyers. 

The Lanham Act (Federal 

Trademark Act of 1946) also provides 

rights for the trademark holder. In 

particular, the Act allows mark holders 

to take action to end deceitful 

practices in interstate commerce 

involving the misuse of trademarks. 

Marks, for instance, gain rights 

when used. The Internet allows 

marks to be used in nontraditional 

ways that expand the use of the 

marks as well as the likelihood of 

confusion and, along with that 

increased or actual likelihood of confusion, 

an increase in infringement 

claims. The use of trademarks on the 

Internet has four major forms of 

alternative use besides their traditional 

form of use as a publication: 

1. Domain names; 

2. Meta tags; 

3. Hyperlinks; and 

4. Framing marks. 

MAJOR INTERNET ALTERNATIVE 

TRADEMARK USES 

Domain Names 

A domain name, of course, is the 

registered identifier that generally 

replicates a firm name, product or 

phrase. To acquire an Internet 

address, an entity need only pay a 

nominal fee to an Internet registrar, 

such as Network Solutions Inc., and 

file for a name not previously registered. 

Due to the ease with which 

domains can be registered, many 

trademarked domain names were initially 

registered by enterprising entities 

known as cybersquatters who 

knowingly reserved a trademark as a 

domain name merely to sell it for 

profit. 

Typo-squatting is another form of 

cybersquatting that relies on erroneous 

user input. Typo-squatting 

occurs when an entity registers a 

famous mark with misspellings, 

reversed letters or other common 

typos built into the domain name in 

an attempt to redirect an Internet 

user to the cybersquatter’s own Web 

site. Alternatively, a cybersquatter 

might try to get the famous mark’s 

owner to pay to redirect the 

mistyped Web address to the mark 

owner’s Web address. 

Another potential trademark issue 

involving domain names is those 

names that more than one person or 

entity could claim. In Nissan Motor 

Co. v. Nissan Computer Corp., 89 F. 

Supp. 2d 1154 (C.D. Cal. 2000), the 

Nissan car company (which was first 

to register its trademark) brought suit 

against the Nissan computer company 

(dubbed after the owner’s surname) 

for trademark infringement 

after the computer firm registered 



7

Trademark 


domain names using the word 

Nissan. The court found that the 

computer firm’s registration resulted 

in consumer confusion for several 

reasons, including initial interest confusion 

and actual confusion. 

The court found initial interest 

confusion because the Nissan name 

might have led a consumer to believe 

that it was a Web site for Nissan cars, 

and that alone is enough to find consumer 

confusion. The court also 

found actual confusion because nearly 

all the computer company’s revenue 

stemmed from visitors to the 

Web site clicking on automobile 

advertisements displayed on it. 

Despite this, the court was careful to 

point out that there is a “judicial 

reluctance to enjoin use of a personal 

name” even when it apparently 

infringes on a trademark, but that it 

was still possible to limit the use with 

a “carefully tailored injunction.” 

This case and others resulted in the 

enactment of the Anti-Cybersquatting 

Consumer Protection Act. 

Additionally, the Internet Corporation 

for Assigned Names and Numbers 

(“ICANN”) adopted its Uniform 

Domain Name Dispute Resolution 

Policy to provide an alternative to litigation 

in dealing with abusive 

domain-name registrations. 

Meta Tags 

The second trademark infringement 

issue unique to the Internet 

entails meta tags, which provide 

Internet page-setting information that 

is normally invisible to a user. Meta 

tags are commonly used by search 

engines, such as Google, to index site 

content. The content of meta tags, 

when properly used, gives content 

some context. Four types of content 

are often used as a part of meta tags: 

• Resource type; 

• Key word; 

• Description; and 

• Distribution. 

The unauthorized use of another’s 

mark as an element of meta-tag content 

could result in infringement. 

The use of registered marks as part 

of a meta tag might result in consumer 

confusion and, as such, could 

8 

be a basis for infringement litigation; 

for example, the use of various 

“Playboy” trademarks in meta-tag 

lines. (See, Playboy Enter., Inc. v. 

Calvin Designer Label, 985 F. Supp. 

1220 (N.D. Cal. 1997) and Playboy 

Enter., Inc. v. Torri Welles, 7 F. Supp. 

2d 1098 (S.D. Cal. 1998)). 

The Seventh and Ninth District 

courts have ruled that meta-tag use 

might infringe on famous marks. 

(See, Promatek Indus. v. Equitrak 

Corp., 300 F.3d 808 (7th Cir. 2002); 

and Brookfield Communications v. 

West Coast Entertainment, 174 F.3d 

1036 (9th Cir. 1999)). Both courts 

have followed the same line of reasoning, 

holding that the “initial interest 

confusion” that consumers experience, 

regardless of whether it 

results in actual confusion once they 

are viewing the Web site, is adequate 

for the imposition of trademarkinfringement 

liability. It should be 

noted that the Promatek decision 

was amended to state that meta-tag 

usage by a defendant come into play 

only when the infringing company is 

actually using the trademark to 

deceive consumers. 

Hyperlinks 

Hyperlinks are the third trademarkinfringement 

issue unique to the 

Internet. A hyperlink is an element of 

an electronic document that links to 

another place in the same document 

or to an entirely different document. 

Users typically click on the hyperlink 

to follow the link to the document to 

which it is connected. Hyperlinks are 

an indispensable constituent of all 

hypertext systems, such as the World 

Wide Web. Hyperlink use, however, 

has the potential for trademark 

infringement, and allegations have 

been made that hyperlinks can cause 

trademark-infringement problems in 

the form of passing off, reverse passing 

off, and false advertising. 

Framing 

Framing is the fourth way that a 

trademark can be violated on the 

Internet. Framing occurs when one 

Internet site displaces another site’s 

content by surrounding or framing it 

with a portion of its own site. In the 

case of TotalNews (The Washington 

Post v. TotalNews, Southern District 

of New York, Civil Action Number 


97-1190), the Washington Post and 

other newspaper publishers brought 

suit against an Internet news site for 

using framing technology to display 

the news organizations’ information 

on the TotalNews site and surrounding 

the other content with its own 

advertising. This practice was found 

to be tantamount to trademark dilution 

because the framing practice 

was likely to confuse users in that 

they would be led to believe that the 

source of these advertisements was 

the plaintiffs’ newspapers. 

DOUBLE JEOPARDY 

The special trademark-infringement 

problems that the Internet presents 

(domain names, hyperlinks, 

meta tags and framing) are in addition 

to the amplification of traditional 

trademark infringement that results 

from the worldwide use of the 

Internet. Consider the international 

trademark-infringement difficulties 

faced by Playboy Enterprises. In 

Playboy Enter., Inc. v. Chuckleberry 

Publ’g, Inc., 687 F.2d 563 (2d Cir. 

1982), the Second Circuit Court of 

Appeals had granted an injunction, 

enjoining Chuckleberry from using 

the confusingly similar mark 

Playmen for the distribution of 

Chuckleberry’s Italy-based magazine. 

Despite this judicial result in a parallel 

suit brought to enjoin 

Chuckleberry’s use in Italy, the 

Italian court upheld the use of the 

Playmen mark. 

Subsequently, in Playboy Enter., 

Inc. v. Chuckleberry Publ’g Inc., 939 

F. Supp 1032 (S.D.N.Y. 1996), when 

Chuckleberry published an Internet 

Web site for its magazine, again 

using the mark Playmen, based in 

Italy, Playboy brought suit for a violation 

of the injunctive order granted 

in the prior Playboy v. Chuckleberry 

case, citing that the worldwide 


LAW JOURNAL NEWSLETTERS 

REPRINT SERVICE 

Promotional article reprints of this article or any 

other published by LAW JOURNAL NEWSLETTERS 

are available. 

Call Matt Solomon at 212-545-6289 or 

e-mail msolomon@alm.com 

for a free quote. 

Reprints are available in paper and PDF format. 

June 2007

Mobile Marketing 


component. If the primary purpose of 

the message is commercial, then SMS 

and MMS messages will fall under the 

FCC’s Mobile Service Commercial 

Message (“MSCM”) definition. 

In fact, wireless service providers 

have established specific domains for 

sending and receiving “mobile service 

messages,” pursuant to CAN-SPAM. 

They are all listed on the FCC’s 

Wireless Domain Name Download 

Registry (www.fcc.gov/cgb/policy/ 

DomainNameDownload.html). While 

CAN-SPAM does not prohibit transactional 

or relationship messages, it 

does otherwise prohibit messages to 

mobile devices — hence, the domains 

on the registry — absent “express 

prior authorization.” That authorization 

can be written — meaning via 

actual paper, an e-mail or a SMS message 

— or it can be oral; but in each 

case, the authorization is subject to 

sender verification. 

TELEPHONE REGULATIONS 

SMS and voice messages are covered 

by the TCPA and TSR. The TCPA 

prohibits calls to mobile devices 

(where the receiving party is 

charged) using an automatic telephone-dialing 

system, artificial and 

pre-recorded messages, or both of 

the last two. Florida has a similar law. 

The TCFAP empowered the FTC to 

issue the Telemarketing Sales Rule, 

which generally prohibits telemarketers 

from engaging in certain 

deceptive acts or practices. But it is 

more generally known for establishing 

the National Do Not Call Registry. 

If a wireless number is listed on that 

registry, then a marketer is barred 

from calling that number unless it 

has an “established business relationship 

with the consumer.” That is, a 

relationship based on: 

• “The consumer’s purchase, 

rental, or lease of the seller’s 

Luis Salazar is a shareholder with 

Greenberg Traurig, in Miami, and a 

member of the firm’s Privacy and 

Data Security Task Force. A member 

of e-Commerce Law & Strategy’s 

Board of Editors, Salazar can be 

reached at salazarl@gtlaw.com. 

goods or services or a financial 

transaction between the consumer 

and seller, within the 

eighteen (18) months immediately 

preceding the date of the telemarketing 

call”; or 

•“The consumer’s inquiry or application 

regarding a product or 

service offered by the seller, 

within three months immediately 

preceding the date of a telemarketing 

call.” 

Telemarketers must scrub their lists 

against the registry every 31 days. 

OTHER RESTRICTIONS 

A variety of other federal laws 

might also apply, depending on 

the type of marketing campaign 

undertaken. For example, if marketers 

are targeting children under 13, then 

the Children Online Protection Act 

(“COPA”) will control the manner and 

type of personal information collected. 

As another example, the FTC may 

bring an enforcement action against a 

mobile marketer if the Commission 

believes the marketer’s actions are 

unfair or deceptive. 

Likewise, a number of state laws 

can apply to mobile-marketing campaigns, 

including state Do Not Call, 

SPAM and unfair trade-practice 

statutes. 

BEST PRACTICES, BEST RESULTS 

Despite these regulations, there’s 

plenty of room for missteps and 

abuses in what is largely uncharted 

and self-policed territory. In an 

attempt to lead the industry, the 

MMA has developed an industry 

code of conduct and best practices 

that it has broken into six categories: 

1. Choice; 

2. Control; 

3. Customization; 

4. Consideration; 

5. Constraint; and 

6. Confidentiality. 

The categories are outlined below. 

Choice 

Consumers must opt in to a specific 

mobile-messaging program, either 

by text messaging, calling a voiceresponse 

unit, via a Web site or 

through a paper-based method. For 

premium services through which 

charges can accrue rapidly, double 

and even triple opt-in requirements 

are the norm. 

Control 

Customers must have the power to 

opt out of or terminate participation 

in programs. 

Customization 

Because mobile-messaging campaigns 

are most effective when 

appropriately targeted, consumers 

should be asked to volunteer demographic, 

preference and other information. 

This allows messages to the 

opt-in consumer to be what the consumer 

wants, and when he or she 

wants it. 

Consideration 

The MMA is advocating specific 

trust provisions on not renting, selling 

or sharing personal information 

with other people or non-affiliated 

companies, except to provide the 

product or services requested. But 

aggregate, non-personally identifiable 

information may be shared with 

partners for research purposes. 

Constraint 

Marketers should implement a 

global throttling mechanism that controls 

the number of marketing messages 

directed to one consumer, even 

from different marketing campaigns. 

Optimally, the limit should default to 

two new campaigns per week. 

Confidentiality 

The MMA urges marketers to adopt 

Web-site privacy and online publicinterest 

watchdog firm TRUSTe’s specific 

provisions on not renting or sharing 

personal customer information, 

and establishing clear privacy policies 

that comport with TRUSTe’s standards. 

CONCLUSION 

As with any unexplored electronic 

frontier, mobile marketing presents 

entrepreneurs with apparently endless 

opportunities to stake new territory 

and find riches. At the same 

time, “lawless” behavior in any frontier 

can rouse government attention 

or, perhaps worse, drive the public to 

exact its own rough justice — by 

avoiding your products or services. 

So, it pays to mind the applicable 

laws and regulations, and to pursue 

best practices to ensure that you get 

the best return on your mobile-marketing 

investment. 

—❖— 


9

FCC ORDER PREEMPTING 

STATE REGULATION 

OF VOIP IS UPHELD 

The determination of the Federal 

Communications Commission (“FCC”) 

determination that state regulation of 

VoIP services is preempted under federal 

law because it is currently impossible 

to separate the interstate and 

intrastate aspects of VoIP service was 

not arbitrary or capricious. Minnesota 

Public Utilities Commission v. Federal 

Communication Commission, 2007 

U.S. App. LEXIS 6448 (8th Cir. Mar. 21, 

2007). In upholding the agency’s 

order and denying various state regulatory 

agency petitions for review, the 

court ruled that the FCC could preempt 

state regulation of VoIP after 

determining it would be impractical to 

separate the intrastate portions of 

VoIP service from the interstate portions, 

particularly given the practical 

difficulties with determining the geographic 

location of “nomadic” VoIP 

phone calls (i.e., VoIP service via any 

available broadband connection) versus 

“fixed” VoIP service (i.e., service 

from a fixed location, such as home 

cable-TV equipment). Referencing the 

FCC’s previous E911 Order, which 

required VoIP providers to ensure that 

customers using VoIP have 911 emergency 

service, the court commented 

that the current preemption order had 

a potentially limited temporal scope, 

because it could be lifted if technology 

is developed to identify the geographic 

location of nomadic VoIP 

communications. 

USE OF PREVIOUSLY LICENSED 

PICTURES FOR ONLINE 

SELF-PROMOTION DISPLAY 

IS NOT FAIR USE 

A marketing agency’s inclusion of 

a brochure containing a previously 

licensed photograph in an online 

portfolio that promoted past advertising 

campaigns is not protected by 

the copyright fair-use doctrine. 

Straus v. DVC Worldwide, Inc., 2007 

U.S. Dist. LEXIS 20907 (S.D. Tex. Mar. 

23, 2007). In denying the agency’s 

motion for partial summary judg- 

10 

e-Commerce DOCKET SHEET 

ment, the court rejected the argument 

that posting past advertising 

materials containing copyrighted 

images for promotional purposes satisfies 

the criteria for fair use. The 

court found, among other things, that 

the defendant’s “transformative” use 

of the photo as commentary on its 

own advertising practice was “slight 

to non-existent” given that the use of 

the entire photograph was wholly for 

private commercial gain and outside 

the terms of the original license 

agreement. The court also declined 

to grant summary judgment in the 

agency’s favor on the theory that use 

of the photograph was subject to an 

implied license based on advertisingindustry 

custom, finding that the 

copyright owner’s expressed disapproval 

of the use of the photograph 

prior to the filing of the lawsuit created 

an issue of fact that could not be 

resolved on summary judgment. 

COMMERCIAL E-MAIL CONFORMS 

TO STATE SPAM LAW, EVEN 

THOUGH RECIPIENT CAN’T REPLY 

A commercial e-mail that otherwise 

conforms to the Washington state 

anti-spam law by providing accurate 

transmission path information and 

unsubscribe links is not in violation of 

the law simply because the e-mail 

recipient is unable to send a reply email 

to the sender. Benson v. Oregon 

Processing Service, Inc., No. 34195-6- 

II, 2007 Wash. App. LEXIS 31 (Wash. 

Ct. App. Jan. 9, 2007). The court 

noted that the plaintiff elected not to 

click on the “unsubscribe” links provided 

in the e-mails, nor use the physical 

address or phone number provided 

in the e-mails to unsubscribe. The 

appellate court affirmed the lower 

court’s dismissal of the plaintiff’s 

claim, finding that the defendant’s failure 

to provide “reply” functionality to 

the commercial e-mail did not “misrepresent” 

or “obscure” the point of 

origin or transmission path of the 

message. The appellate court concluded 

that the statute says nothing 

about how useful a commercial email’s 

point of origin or transmission 

path must be, does not require a com- 


mercial e-mail sender to acknowledge 

or respond to a recipient’s reply email, 

and does not require that e-mail 

replies be deliverable. 

U.S. COURT CAN 

PERMANENTLY ENJOIN 

RESIDENT FROM BUSINESS 

A federal district court did not 

abuse its discretion in giving the 

Lanham Act extraterritorial effect by 

permanently enjoining a U.S. resident 

from using the “Versace” name 

to sell commercial goods anywhere 

in the world or over the Internet. 

Gianni Versace, S.P.A. v. Alfredo 

Versace, 2007 U.S. App. LEXIS 705 

(2d Cir. Jan. 10, 2007). In rejecting 

the defendant’s argument that the 

district court failed to consider that 

he is a U.S. resident and not a citizen, 

the appellate court pointed to the 

defendant’s 40 years of residence 

and business activity in the United 

States, coupled with the lack of conflict 

with foreign law and “the existence 

of a substantial effect on commerce.” 

The court also noted the 

defendant’s violations of prior injunctions, 

which supported the district 

court’s refusal to permit the defendant 

to use the “Versace” name 

accompanied by a disclaimer. 

SUCCESSFUL DEFENDANT 

DENIED ATTORNEY’S FEES 

IN CAN-SPAM CASE 

A defendant in a CAN-SPAM Act 

case who won a motion to dismiss 

for lack of personal jurisdiction is not 

entitled to an award of attorney’s 

fees when there is no evidence of 

bad intentions or frivolousness on 

the plaintiff’s part, and when such an 

award would not be consistent with 

the purposes of the act. Phillips v. 

Worldwide Internet Solutions, 2007 

U.S. Dist. LEXIS 4974 (N.D. Cal. Jan. 

22, 2007). In adopting and affirming 

the magistrate judge’s recommendation, 

the court denied the defendant’s 


The publisher of this newsletter is not engaged in rendering 

legal, accounting, financial, investment advisory or other 

professional services, and this publication is not meant to 

constitute legal, accounting, financial, investment advisory or 

other professional advice. If legal, financial, investment 

advisory or other professional assistance is required, the 

services of a competent professional person should be sought. 

June 2007

M OVERS & SHAKERS 

PHILLY E-COMMERCE LAWYER 

QUOTED IN COPA ARTICLE 

The Christian Science Monitor 

recently featured comments by Carl 

Solano, a partner in the Philadelphia 

office of Schnader Harrison Segal & 

Lewis, on the Third Circuit’s decision 

on the Child Online Protection Act 

(“COPA”). The article, “Internet 

Filters Block Porn, But Not Savvy 

Kids,” quoted Solano, who practices 

e-commerce law and makes a specialty 

of First Amendment and appellate 

matters, as saying: “Just because 

you want to protect kids doesn’t 

mean you can ban the information 

from adults.” 

Solano has been counsel for 

domain-name registrars in litigation 

over the ownership and control of 

domain names, and has advised 

Internet publishers on regulating 

online content. He has also been an 

adjunct professor on e-commerce 

and computer issues the Villanova 

University School of Law. 

FINNEGAN HENDERSON 

LAWYER NAMED TO TECH 

ASSOCIATION BOARD 

Finnegan Henderson Farabow 

Garrett & Dunner partner Lawrence 

R. Robins was recently elected to 

the International Technology Law 

Association (“ITechLaw”) board. 

Robins, of the firm’s Cambridge, MA, 

Docket Sheet 


motion for attorney’s fees, finding no 

evidence that the plaintiff’s suit was 

“frivolous” or “objectively unreasonable,” 

in the factual and legal components 

of the case. The court found that 

an award of attorney’s fees in this case 

would not be consistent with the 

purposes of the CAN-SPAM Act, name- 

e-Commerce Docket Sheet was written 

by Julian S. Millstein, Edward A. 

Pisacreta and Jeffrey D. Neuburger, 

partners in the New York office of 

Thelen Reid Brown Raysman & 

Steiner LLP (www.thelen.com). 

office, handles intellectual-property 

issues, with a focus on strategic development 

of trademark portfolio, 

according to Finnegan Henderson. 

He’s also active in matters concerning 

management and protection of the 

portfolios, trademark litigation, copyright 

disputes, and computer and technology 

legal issues. The ITechLaw 

board is working on educating professionals 

on established and emerging 

worldwide technology markets. 

PITTSBURGH DIVERSITY 

ATTORNEYS MOVE ON 

Carl Cooper, one of the first chief 

diversity officers of any large firm 

when he took the position at K&L 

Gates in January 2003, has left the 

firm to start his own consultancy, 

working with other firms on similar 

issues. 

Cathy Bissoon has left Reed 

Smith’s Pittsburgh office for Cohen & 

Grigsby. She’d been director of diversity 

since 2001. Reed Smith said last 

month that it has appointed 

Washington, DC-based partner Tyree 

P. Jones Jr. as its new director of 

diversity. 

TEXAS LAWYER NAMED 

SOCIAL JUSTICE CRUSADER 

Kathleen J. Wu, a partner with 

Andrews Kurth LLP in Dallas, has 

been designated a “Women of Spirit” 

ly to “protect the convenience and 

efficiency of e-mail” and to “prevent 

time and monetary losses to individuals 

and internet service providers.” 

PROVIDER OF ANTI-SPAM 

OPEN RELAY DATABASE 

GETS CDA IMMUNITY 

A Web site owner who created a 

spam “block list” that identified 

open-relay servers useful to spammers 

is immune from liability under 

the “Good Samaritan” provision of 

the Communications Decency Act 

(“CDA”) for incorrectly listing the 

plaintiff’s IP address on the block list. 

Pallorium, Inc. v. Jared, 2007 Cal. 

App. Unpub. LEXIS 241 (Cal. Ct. 

award recipient by the American 

Jewish Congress Southwest Region. 

Women judged to have been diligent 

and spirited pursuing social justice 

are eligible for the award. 

“I’m humbled to be in such great 

company, and I deeply appreciate 

this recognition from the American 

Jewish Congress,” Wu said in an 

Andrews Kurth news release posted 

on the firm’s Web site. 

Wu writes a column dealing with 

issues women face in the legal profession 

for our ALM affiliate newspaper 

Texas Lawyer. She often speaks 

about how diversity benefits the 

workplace. 

MORRISON MAKES SOME 

CHAIRPERSON CHANGES 

Steven Kaufmann, a partner in the 

Denver office of Morrison & Foerster 

who has been with the firm for more 

than 20 years, was recently named the 

new chair of Morrison & Foerster’s litigation 

department. He leads a group 

of 490 attorneys in 18 offices in 

the United States, Europe and 

Asia. Kaufmann takes over from 

San Francisco-based partner Lori 

Schechter, who had been practice 

chair since 2003. Schechter continues 

her own active case work in consumer 

class actions and antitrust matters. 


App. Jan. 11, 2007) (unpublished). 

The appellate court upheld a trialcourt 

judgment finding the owner 

immune under Section 230(c)(2)(B) 

as a “provider” of an “interactive 

computer service” who made available 

“technical means” to restrict 

access to material that the provider 

thought was “harassing or otherwise 

objectionable.” The court also found 

that the fact that the owner’s block 

list might have been over-inclusive 

was irrelevant so long as the owner 

deemed the material he sought to 

block (i.e., offensive spam e-mails) 

as harassing and objectionable. 

—❖— 


11

Movers & Shakers 


THELEN CONTINUES BUILDING 

CONSTRUCTION PROFILE 

Thelen Reid Brown Raysman & 

Steiner LLP has been named the 

2007 “Global Construction Law Firm 

of the Year” by Who’s Who Legal, the 

firm reported on its Web site. 

The annual Law Firm of the Year 

awards are determined based on 

nominations made by clients of the 

firm and fellow professionals. Only 

the most exceptional performance 

receives this distinction in each of 27 

practice areas. 

“For many years, our firm has been 

recognized as having the ‘preeminent 

Construction Law Practice in the 

‘Hotmail’ 


do. One must assume that anything, 

and everything, created will eventually 

be discovered, and disclosed to 

the public, whether that was the 

intention of the person who wrote it 

or not. As Sen. Patrick Leahy (D-VT), 

chairman of the Senate Judiciary 

Committee, noted in connection 

with its investigation of the RNC fiasco, 

“You can’t erase e-mails, not 

today. They’ve gone through too 

Trademark 


nature of access to Internet Web sites 

was a violation of the court 

order. The court agreed, stating that 

the Web site was the same as the circulation 

of a magazine (a “use”) 

within U.S. territory and ordered 

Chuckleberry to block U.S. access to 

the Web site. 

12 

For even FASTER service, call: 

1-877-ALM-CIRC 

United States,’” Thelen Construction 

Chair John Heisse said. “This distinction 

shows that the industry is aware 

of our continued growth and now 

sees us as a global leader.” 

SIMPSON THACHER 

LAWYER NAMED AS 

TOP WOMAN LITIGATOR 

Simpson Thacher litigation associate 

Deborah Stein was recently named 

one of the Top 75 Women Litigators in 

California by the Daily Journal, 

according to a news release on the 

law firm’s Web site. The firm provided 

the following description. The award 

honors women who have litigated a 

major victory in the last year, set 

records in the legal community, play a 

prominent role in their practice area, 

many servers. Those e-mails are 

there – they just don’t want to produce 

them. It’s like the infamous 18 

minute gap in the Nixon White 

House tapes.” 

From that perspective — that anything 

created will be found — perhaps 

the best way to maintain the 

controls required by the developing 

laws of e-commerce and e-discovery 

is to eliminate the incentives to 

bypass those controls. Instead, firms 

should encourage use of their systems 

by designing them to be so 

OTHER CASES APPLY 

Other cases have similarly expanded 

the application of U.S. trademark 

law involving the Internet. In the 

case of Levi Strauss & Co. v. Sunrise 

Int’l Trading Inc., 51 F.3d 982, 984 

(11th Cir. 1995), for instance, a confusingly 

similar product to that of 

Levi Strauss’ was sold from China, 

though never actually within the 

United States. Based on the fact that 

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and are generally involved in the legal 

community. Stein, based in the firm’s 

Los Angeles office, was selected based 

on her lead role in two significant 

cases: CalPERS v. Banc of America 

Securities LLC, et al., a suit brought by 

the largest pension fund in the United 

States arising out of the collapse of 

Enron, and Insurance Company of the 

State of Pennsylvania v. Central 

Garden & Pet Company, et al., a case 

in which a federal court in California 

squarely held on cross-motions for 

summary judgment that the firm’s 

client was entitled to withdraw from 

the defense of ongoing claims and 

was also entitled to reimbursement of 

defense costs. 

—❖— 

user-friendly that online accounts 

and other alternatives do not provide 

any real conveniences to attract 

the casual user. That way, when the 

CEO demands, “I want my Hotmail,” 

IT can respond, paraphrasing singersongwriter 

Mark Knopfler, founder 

of the band Dire Straits, that using 

the company account is so easy that 

it “ain’t workin’, that’s the way you 

do it.” 

—❖— 

the quality of these goods could 

reflect poorly on the mark owner, the 

court applied the Lanham Act 

extraterritorially. 

e-Commerce enterprises are well 

advised to have their counsel pay the 

closest attention to how trademarks 

might be used online — other companies’ 

and their own. 

—❖— 

On the Web at: 

www.ljnonline.com 

*Offer valid to new subscribers only 

Publisher’s Guarantee! You may cancel your subscription at any time, for any reason, and receive a full refund for all unmailed issues. 

3038-2007 

June 2007

e-commerce LAW & STRATEGY - Heymann & Partner, Rechtsanwälte

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