Technically Legal

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Fourth Circuit Takes Another Look at TrafFix

On June 25, 2014, the Fourth Circuit Court of Appeals released an opinion that provided an interesting follow-on to the 2001 Supreme Court TrafFix case.

In TrafFix, the plaintiff held patents on signs with two springs: one at each side of the display. This allowed the signs to bend in the wind, and spring back. TrafFix, the defendant, was sued for trade dress infringement. The Court held that it was the burden of the plaintiff to show that the design was non-functional, and that the presence of a utility patent was strong evidence of functionality. If a design is functional it cannot be protected by trade dress or trademark.

In this case, McAirlaids made absorbent pads with a specific “pixel” design on them. Defendant Kimberly-Clark also made absorbent pads with the same design. Kimberly-Clark argued that because McAirlaids had a utility patent on the process of making these pads, that there was strong evidence that the pads were not protected by trade dress law. The district court agreed and granted summary judgment to Kimbely-Clark.

On appeal, the Fourth Circuit vacated the case and remanded. The court noted that the patent was on the process of making the pads without the use of glue, but the precise pixel design was not part of the patent. Further weighing in McAirlaid’s favor was that McAirlaid had obtained registered trade dress on the pixel design. Once to registration is obtained, there was a presumption that the design was non-functional.

It is worth noting that the stance of this case was on appeal of a motion for summary judgment. The facts were all construed in favor of McAirlaid, and a jury may still find the design functional. The Fourth Circuit has provided some intriguing clarification into the interaction between utility patents and registered trade dress.

Posted in: Analysis by Ben Snitkoff. Tags: , ,
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Entertainment Law Update on Aereo

In addition to the cellphone opinion we already covered, on June 25th, the Supreme Court decided the Aereo case in favor of the major broadcasters.

We’ve been a little tied up, but our friends at the Entertainment Law Update did a quick podcast discussing the opinion. It’s some of the best analysis of the opinion we’ve seen. Hopefully we’ll be able to chime in with a few thoughts soon.

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Supreme Court Holds Warrantless Cell Phone Search Unconstitutional

The Supreme Court handed down an opinion in two related cases relating to searching cell phones. Both cases involved defendants who were searched incident to arrest. Those defendants had cellphones on their person, and, without first obtaining a warrant, the police officers searched the cellphones for evidence of unrelated crimes.

When someone is arrested, police may conduct a limited search of that person and the immediate surroundings for the safety of the police officer. This often includes emptying pockets, or searching the inside area of a car where the person was sitting. This kind of search is also justified due to a risk of defendants destroying evidence on their person.

The Court held that neither of these justifications come into play with a cellphone. The device is not dangerous, and there is no reason to think that, when seized by the police, there is any risk of destruction of evidence. While data on phones may be encrypted or remotely wiped, neither justifies a warrantless search of the phone. The concern about destroying evidence is typically about evidence in the possession of the defendant: that he would flush drugs down a toilet, or shred papers. The concern is not that a third party would find out about his arrest and instigate a remote wipe.

Like all cases involving the Fourth Amendment, the Court was careful to state that there may be exceptions to this rule. If, for instance, the police had specific information that data on the phone implicated public safety, or there was another pressing need (based on reliable information), the warrant requirement could be waived.

Importantly, the Court put a lot of weight on cellphones containing a large amount of personal information — information that would not otherwise be readily available to police officers. This strikes me as a solid win for digital privacy.

I leave you all with this quote from the Chief Justice’s opinion:

In 1926, Learned Hand observed . . . that it is “a totally different thing to search a man’s pockets and use against him what they contain, from ransacking his house for everything which may incriminate him.” United States v. Kirschenblatt, 16 F. 2d 202, 203 (CA2). If his pockets contain a cell phone, however, that is no longer true. Indeed, a cell phone search would typically expose to the government far more than the most exhaustive search of a house: A phone not only contains in digital form many sensitive records previously found in the home; it also contains a broad array of private information never found in a home in any form—unless the phone is.

Posted in: Analysis, Commentary by Ben Snitkoff. Tags: ,
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Alice Corp v. CLS Bank – Abstract Claims Continue to Be Like Obscene Material

Judges in the Federal Circuit and Supreme Court appear to know an abstract claim when they see it, but they don’t seem to be able to delineate any guidance for the rest of us mere mortals.

At least, that’s the feeling a lot of folks are getting from the most recent patent case out of the Supreme Court. The case, that involved structured settlements, continues to blur the line between patentable computer processes and unpatentable business methods.

The case only came out an hour ago (as of writing this). I’m sure there will be insightful analysis over time, but meanwhile many of us are feeling a bit lost.

Posted in: Commentary by Ben Snitkoff.
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Second Circuit Limits Scope of Data Retention

On June 17, 2014, the Second Circuit Court of Appeals addressed the question of:

whether the Fourth Amendment permits officials executing a warrant for the seizure of particular data on a computer to seize and indefinitely retain every file on that computer for use in future criminal investigations.

The Second Circuit held that the Fourth Amendment does not permit that conduct. The court relied on underlying principles of the Fourth Amendment in finding that the government may not seize and retain all documents, regardless of whether they were responsive to a warrant.

The Fourth Amendment requires that a warrant specify the documents and things to be seized. While modern technology allows for police officers to easily copy the entire contents of a hard drive, that does not permit them to retain those documents indefinitely, or search documents that were not covered by the warrant through which they obtained the hard drive.

In this case, the government obtained a narrow warrant in 2003. That warrant did not include certain personal records. Despite separating the personal records from the business records, the government retained the personal records until 2006. The government then obtained a second warrant, and searched those personal records, which led to the charges from which this case arose.

Because the government had no basis for retaining those personal records for so long, that they obtained a warrant several years later did not cure the underlying problem: that they still had the documents long after they should have been destroyed.

This is certainly a win for the public, albeit a limited one. We’ll continue to closely watch the development of case law surrounding the Fourth Amendment with relation to technology.

Posted in: Analysis, Commentary by Ben Snitkoff. Tags: ,
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Third Circuit Condones Warrantless Use of Directional WiFi Sniffers

In an opinion in an appeal from a criminal case, the Third Circuit Court of Appeals has held that, under the circumstances presented, a defendant had no expectation of privacy in the WiFi signal coming from his home.

The facts are these: in 2010, a police officer was conducting an investigation into the sharing of child pornography on the Gnutella network. After determining the IP address of the user sharing the materials, the officer obtained a warrant. Upon executing the warrant, the officer found no illegal materials on the target’s computers, but found an unprotected WiFi router. With permission, the office attached a computer to the router that would allow him to remotely monitor the network.

Eventually, the WiFi router was accessed, and the illegal materials were once again shared on Gnutella. Accessing the router remotely, the officer obtained the MAC address of the sharing computer. Using that MAC address, a directional antenna, and a program called MoocherHunter, the officer determined which house the signal originated from, resulting in the defendant’s arrest.

The defendant argued that this constituted an illegal warrantless search. The court disagreed, first asking:

(1) whether the individual demonstrated an actual or subjective expectation of privacy in the subject of the search or seizure; and (2) whether this expectation of privacy is objectively justifiable under the circumstances.

The defendant argued that this case was similar to Kyllo, in which police used thermal imaging to determine whether someone was using heat lamps: commonly used in the cultivation of marijuana. The court noted that here, the defendant made no attempt to keep his actions to within in home. Indeed, in order to access the unprotected router, the defendant had to send radio signals outside his home. This would have been a fine place to end the discussion however, the court continued:

Here, the presence of [the defendant's] unauthorized signal was itself “wrongful.” When [he] deliberately connected to the Neighbor’s unsecured wireless network, he essentially hijacked the Neighbor’s router, forcing it to relay data to Comcast’s modem and back to his computer, all without either the Neighbor’s or Comcast’s knowledge or consent. [The defendant] was, in effect, a virtual trespasser.

It does not appear that this particular finding was necessary to determine this case, and the idea that merely using someone else’s unprotected network without permission is unauthorized or illegal is worrying. The court stopped short of saying that “wireless mooching” is per-se illegal, but the dicta clearly shows the court’s opinion of using unprotected networks.

The court did take a moment to chide the district court for making a common mistake in Fourth Amendment analysis. The district court found that because the defendant broadcast his signal to a third party, the police did not need a warrant. This comes from a common misreading of Fourth Amendment case law, which states that you don’t have an expectation of privacy in things you willingly turn over to a third party. However, that only means that if that third party has possession of those things, the third party can feely turn them over to the police. It does not mean, as district courts often find, that police can obtain information also held by third parties by any means, regardless of the implications to the Fourth Amendment.

Overall, I think the court got this right. If I’m sending data to a neighbor’s house, and the officer, with permission from the neighbor, and readily available software and hardware, can determine where that data is coming from, he hasn’t violated the Fourth Amendment. However, predicating this finding on the access to the network being “unauthorized” or “likely illegal” seems to go too far.

Posted in: Analysis, Commentary by Ben Snitkoff. Tags: , ,
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Sixth Circuit Reaffirms Vicarious Liability for Copyright Infringement

In a terse opinion, the Sixth Circuit reaffirmed that someone who has the right and ability to supervise infringing conduct, and has a direct financial interest in that infringement, can be vicariously liable for copyright infringement, despite committing no direct acts of infringement themselves.

In this case, Roy Barr owned 95% of an LLC that ran a restaurant that offered music and dancing. Over the course of several years, BMI sent the restaurant more than twenty letters informing them of infringement and offering a license. No response was given.

Roy Barr, who represented himself, argued that because he did not perform the copyrighted music, he could not be liable. The court conducted a vicarious liability analysis and found that this case “falls within the heartland of vicarious liability,” and was essentially “the canonical illustration of the doctrine.”

This case serves as a stark reminder to owners and operators of venues that publicly perform music that the music must be properly licensed, or the owner may be liable for the infringing acts of the restaurant and its employees.

Posted in: Analysis, Commentary by Ben Snitkoff. Tags: ,
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Architect Draws on DMCA in Copyright Case

Yesterday the Second Circuit handed down an interesting opinion testing the boundaries of copyright law in protection of architectural works, with a DMCA count thrown in for good measure.

Plaintiff, an architect, sued construction companies for copying his designs for colonial homes in excess, and after the expiration of, a license granted for the use of such plans. Traditionally, works of architecture were not protected by United States Copyright Law. In 1990, after the US became signatory to the Berne Convention, Congress passed a law that added “architectural works” to those works protected by copyright.

The defendants hired additional designers to modify the plans after they were created by the plaintiff, and those modified plans were subsequently used in the construction of homes. Plaintiff alleges that the plans were copied in violation of his copyright, and that, in copying, defendants removed certain markings that constituted “copyright management information” under the DMCA.

The court quickly dealt with the DMCA argument, stating that it had not been fully developed below. “Copyright management information” is broadly defined in 17 U.S.C. 1202, and it seems like the plaintiff may have been able to make out a claim if it were properly pursued below, but it is speculative at best.

The claims of copyright infringement were the focus of the majority opinion, which was well-analyzed by the court. The analysis boiled down to this: there are certain hallmarks of a colonial design that were not original works of this plaintiff. There are other elements of architectural design that are functional and demanded by consumers: countertops on kitchen walls, a closet in each bedroom. What original elements remained, essentially small flourishes, were either not modified from the original plans, or not substantial. So, those elements that may have been copied were not protected, and those that were protected were not copied.

Somewhat surprisingly, case law on copyright in architectural design is still in its infancy, but this opinion is likely to be a guiding force in the years to come. Interestingly, the case also sets up a potential circuit split with regard to how architectural cases are considered: with the Second Circuit treating them like normal creative works, while the 11th Circuit treating them more as compilations.

Posted in: Analysis by Ben Snitkoff.
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SCOTUS Hands Down Two More Unanimous Patent Opinions

The opinions are in the hotly anticipated Akamai case, where the Court rejected the Federal Circuit’s expanded induced infringement doctrine, and in the less anticipated Nautilus case regarding certainty in patent claims. We’ve linked to some solid analysis by the folks at Patently-O, above.

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District Court Awards Fees In Patent Dispute

The blogosphere has been going a little bonkers over a recent opinion awarding legal fees to a defendant in a patent case.

I believe the opinion is the first to award fees under a new standard that the Supreme Court handed down in April. That case was not unusual in that it told the Federal Circuit that the test it was using, here to determine whether fees should be awarded, was too restrictive (a common theme in Supreme Court patent opinions).

This case is important because it has a lot of the features that people most associate with so-called patent trolls: settlement offers from plaintiff well-below the cost of litigation, limited or absent pre-suit diligence, weak infringement claims, and weak patents. This case is less important because those cases make up a relatively small percentage of patent litigation. Further, the conduct that the plaintiff engaged in was arguably independently sanctionable, even without the need of 35 U.S.C. 285 to shift fees.

Notably, nothing in this opinion reach patent trolls who send demand letters, but never file a case. If anything, this opinion will encourage trolls to send more demand letters to companies, but avoid reaching a court room.

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