Fundamentals of business law, 10e Roger leroy miller © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law, Social Media, and Privacy Chapter 6 © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

LEARNING OBJECTIVES What is cybersquatting, and when is it illegal? What steps have been taken to protect intellectual property rights in the digital age? When does the law protect a person’s electronic communications from being intercepted or accessed? © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

LEARNING OBJECTIVES (CONT’D) What law governs whether Internet service providers are liable for online defamatory statements made by users? How do online retailers track their users’ Web browsing activities? © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

introduction The Internet presents a variety of challenges for the law. Courts are often in uncharted waters when deciding disputes that involve the Internet, social media, and online privacy. New rules are evolving but often not as quickly as technology. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law Spam Spam is unsolicited junk e-mail, which accounts for about three-quarters of all e-mails and targets both businesses and individuals Laws to combat spam have been enacted by 36 states and the federal government, but the flow of spam continues. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law Domain Names A domain name is the part to the left of the period in an Internet address. The right part indicates the type of entity that operates the site. Cengage is the domain name In the Internet address, cengage.com. The Internet Corporation for Assigned Names and Numbers (ICANN) oversees the distribution of domain names and operates an online arbitration system. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law Cybersquatting Cybersquatting occurs when a person registers a domain name that is the same as, or confusingly similar to, the trademark of another and then offers to sell the domain name back to the trademark owner. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law The Anticybersquatting Consumer Protection Act (ACPA) makes cybersquatting illegal when both of the following are true: The name is identical or confusingly similar to the trademark of another. The one registering, trafficking in, or using the domain name has a “bad faith intent” to profit from that trademark. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law Meta Tags Meta tags are key words inserted into HTML code to tell Internet browsers information about a Web site. Search engines compile their results by looking through a Web site’s key words. Using another’s trademark in a meta tag without the owner’s permission normally constitutes trademark infringement. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Internet Law Trademark Dilution in the Online World Trademark dilution occurs when a trademark is used online, without authorization, in a way that diminishes the distinctive quality of the mark. Unlike trademark infringement, trademark dilution claims do not require proof that consumers are likely to be confused by a connection between the unauthorized use and the mark. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Copyrights in Digital Information Copyright law is probably the most important form of intellectual property protection on the Internet. Much of the material on the Internet (including software, music, and database information) is copyrighted. To transfer that material online, it must be “copied.” When this is done without authorization, a copyright is infringed. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Copyrights in Digital Information Digital Millennium Copyright Act DMCA gives significant protection to owners of copyrights in digital information. It establishes civil and criminal penalties for anyone who bypasses encryption software or other antipiracy technologies. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Copyrights in Digital Information The Digital Millennium Copyright Act provides exceptions for certain educational and nonprofit uses. It also limits the liability of ISPs for infringement, unless the ISP is aware of the user’s infringement and fails to take action. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Copyrights in Digital Information MP3 and File-Sharing Technology Individuals who download large data files, particularly music or movies, in violation of copyright laws are liable for infringement. Methods of file-sharing: Peer to-peer networking (P2P) Cloud computing © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Copyrights in Digital Information Companies that distribute file-sharing software or provide such services, such as Napster, Inc. and Grokster, Ltd., have been held liable for the copyright infringement of their users if the software or technology involved promoted copyright infringement. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Social media provide a means by which people can create, share, and exchange ideas and comments via the Internet. Social networking sites, such as Facebook, Google+, MySpace, LinkedIn, Pinterest, and Tumblr, have become ubiquitous. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Legal Issues Example: A firm’s intellectual property rights may be infringed if social media users post trademarked images. Example: Social media posts can be used to reduce damages awards. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Law enforcement uses social media to detect and prosecute criminals. Administrative agencies routinely use social media to detect illegal activities and conduct investigations. Employees who use social media in a way that violates their employer’s policies may be disciplined or fired. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media The Electronic Communications Privacy Act ECPA protects a person’s electronic communications from being intercepted or accessed. It also prohibits the intentional disclosure or use of the information obtained by the interception. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Exclusions from ECPA’s coverage: If a company provides an electronic device (e.g., cell phone) to an employee for business use, the company is not prohibited from intercepting business communications made on it. It does not, however, permit employers to monitor employees’ personal communications. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Protection of Social Media Passwords Private employers and schools have sometimes looked at prospective or current employees’ and students’ Facebook or other social media accounts to see their postings. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Some states have enacted legislation that protects individuals from having to divulge their social media passwords. Such laws may not be completely effective in preventing employers from rejecting applicants or terminating workers based on their social media postings. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Social Media Company Social Media Networks Many companies form their own internal social media networks through which employees can exchange work-related messages. Companies with internal social media networks often keep the data on their own servers in secure “clouds.” © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Online Defamation Cyber torts are torts that arise from online conduct. Federal and state statutes apply to certain forms of cyber torts, such as online defamation. Identifying the Author An initial issue raised by online defamation © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Online Defamation Liability of Internet Service Providers Under the federal Communications Decency Act, ISPs generally are not liable for defamatory messages posted by their subscribers. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Privacy Many Internet companies have been accused of violating users’ privacy rights. To sue for invasion of privacy, a person must have a reasonable expectation of privacy in the particular situation, but it is often difficult to determine how much privacy it is reasonable for a person to expect on the Internet. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Privacy Data Collection and Cookies Whenever a consumer makes an online purchase, the retailer collects information through “cookies.” Cookies are invisible files track a user’s Web browsing activities. Retailers have gathered large amounts of data about individuals’ shopping habits by using cookies. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Privacy Internet Companies’ Privacy Policies The Federal Trade Commission (FTC) investigates consumer complaints of privacy violations. Frequently, companies define the privacy rights of their online users. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.

Privacy Consumer Privacy Protection The Obama administration has proposed a consumer privacy Bill of Rights. Designed to ensure the privacy of personal information that is on the Internet If it passes, retailers will have to give consumers better choices about what data are collected and used for marketing. © 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.