1. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-1 The Legal Environment of Business A Critical Thinking Approach 5 th Edition Nancy K. Kubasek Bartley A. Brennan M. Neil Browne

2. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-2 -2 CHAPTER 6 Cyberlaw and Business THE LEGAL ENVIRONMENT OF BUSINESS

3. © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-3 -3 Cyberlaw and Business How is the law changing to meet the demands of new business and social issues generated by the use of computer technology?

4. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-4 -4 Unresolved Issues  Free speech vs. intellectual property rights  Computer security vs. system efficiency  Are jurisdictional boundaries obsolete?  Will cyberspace facilitate free trade?  How should the legal system respond?

5. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-5 -5 Jurisdiction  Mere presence of website not sufficient  The “Sliding Scale” of Zippo:  Sales of goods take place via website  Information is exchanged via website  Information is provided, passively, via website More Interactivity jurisdiction more likely

6. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-6 -6 ACLU v. CDA  The Court applied the “Strict Scrutiny” standard  “Dial-a-porn” case used as precedent  Statute not “narrowly tailored” to accomplish legitimate purposes Ruling: U.S. Supreme Court finds the Communications Decency Act unconstitutional

7. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-7 -7 The Right to Choose Upheld Playboy Channel –  Blocking/scrambling technology required  Restrictive hours imposed The U.S. Supreme Court finds the Telecommunications Act of 1996 overbroad

8. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-8 -8 State Regulations  States’ attempts to regulate sales and practices conducted via Internet are increasingly challenged.  Orders are placed and shipped across state, even national borders.  State interest in regulation of selected products (alcohol, medicines) becoming irrelevant, impossible?

9. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-9 -9 Intellectual Property Issues  Patents  Trademarks and Keywording  Copyrights and Websites

10. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-10 -10 Patents  Product, process, invention, machine, or plant  20-year duration  Protected via infringement actions

11. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-11 -11 Trademarks  Usual Ruling: Courts find a way to rule in favor of trademark holder  Basis: there is bad faith in these cases  New Law: Anticybersquatting Consumer Protection Act 1999 Cybersquatting: The squatter registers the domain name before the trademark owner can—then attempts to sell the domain name to the owner of the trademark

12. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-12 -12 Trademarks  Not created in bad faith  Not illegal, but future legislation expected Warehousing: compilation of prospective business domain names for sale

13. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-13 -13 Copyrights  Creates rights in expression of creative ideas  Books, music, film, plays, computer programs  Copyrights and Websites  Sharing Data  Contributory Copyright Infringement  Linking and Framing

14. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-14 -14 Copyright Issues Sharing Software  The Napster Case  Contributory Copyright Infringement  Enterprise liability  Intellectual Reserve v. Utah Lighthouse

15. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-15 -15 Infringement Examples  Linking and Deep Linking  Framing  Sticky Websites

16. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-16 -16  Unfair competition  False advertising  False representation  False designation of origin  Trademark dilution and infringement Other Causes of Action

17. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-17 -17 E-Commerce Issues PrivacyPrivacy MarketingMarketing CybersignaturesCybersignatures HarassmentHarassment

18. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-18 -18 Privacy  Fear of misuse of personal information  Fear of surveillance Responses:  Public Sector  Private Sector

19. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-19 -19 Federal Statutes  Privacy Act of 1974  Electronic Communications Privacy Act of 1986  Children’s Online Privacy Protection Act of 1988  Financial Services Modernization Act of 1999

20. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-20 -20 State Law  Tort Law  Contract Law  Unfair trade practices and fraud theories Common law rights to privacy

21. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-21 -21 Online Marketing Issues Concerns:  Deception and fraud  Criminal activity  Direct-to-consumer sales— bypassing regulations intended to protect consumers

22. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-22 -22 Cybersignatures  Electronic  Electronic Signatures in Global and National Commerce Act 2000 (E-SIGN)  Allows  Allows creation of valid and enforceable contracts online

23. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-23 -23 Employment Law Issues  Privacy rights of employees  Online harassment  Vicarious liability of employer for defamation  Definition of “workplace”  ISP liability for content of messages

24. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-24 -24 The War Against Cybercrime Hacking: Denial of Service Attacks Insider Trading Internet Gambling SpamSpam Identity Theft

25. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-25 -25 Summary  Technology is leading the law to new areas  Intellectual property law is evolving  E-commerce issues are emerging  Government is combating cybercrime

26. THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 6-26 -26 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2009 Pearson Education, Inc. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall