1. Chapter 4 Torts, Intellectual Property and Cyber Torts

2. Learning Objectives
What is a tort?
What is the purpose of tort law? What are the two basic categories of torts?
What are the four elements of negligence?
What is intellectual property?
What steps have been taken to protect intellectual property rights in the digital age?

3. Tort Law
A tort is a civil, legal injury to a person or property caused by a breach of a legal duty.
Plaintiff (the injured party) sues the Defendant (the Tortfeasor) for damages.
Three Torts:
Intentional
Unintentional (negligence-no fault)
Strict Liability (absolute liability)

4. Intentional Torts Against Persons
Assault and Battery
Assault: the reasonable apprehension or fear of immediate contact
Battery: completion (contact) of the assault.
Defenses:
Consent
Self-Defense and Others
Defense of Property

5. Intentional Torts Against Persons
False Imprisonment
Confinement or restraint of another person’s activities without justification.
Merchants can detain a suspected shoplifter as long as there is probable cause.
Infliction of Emotional Distress
Extreme and outrageous conduct.
Some courts require physical symptoms.

6. Intentional Torts Against Persons
Defamation
Publication of a false statement (oral or written) that injures a person’s good reputation.
Publication: third party must hear or see statement
Statements made on the internet may be actionable.
An individual who re-publishes the statement will be liable.
Statement must hold someone up to contempt, ridicule or hatred in the community.

7. Intentional Torts Against Persons
Defamation (cont’d)
Slander per se (no proof of damages is required):
Loathsome communicable disease
Professional impropriety
Imprisonment for a serious crime
Unmarried woman is unchaste

8. Intentional Torts Against Persons
Defamation (cont’d)
Defenses:
Truth is normally an absolute defense
Statement was Privileged:
Absolute: judicial and legislative proceedings
Qualified: good faith, limited.
Public Figures: plaintiff must show statement made with “actual malice.”

9. Intentional Torts Against Persons
Invasion of the Right to Privacy
Person has the right to solitude. Breach of that duty is a tort.
Appropriation
False Light
Public Disclosure of Private Facts
Rights of Internet users?

10. Intentional Torts Against Persons
Misrepresentation (Fraud)
Intentionally deceive another to believe in a condition that is different from the condition that already exists.
Knowing misrepresentation of fact.
Intent to induce innocent party to rely
Justifiable reliance by innocent party
Causation and Damages.
Contrast: “puffery” or statements of opinion.

11. Intentional Torts Against Persons
Wrongful Interference with Contracts
Valid, enforceable contract exists between two parties
Third party knows about contract
Third party intentionally causes either party to breach the original contract.

12. Intentional Torts Against Persons
Wrongful Interference with Business Relationship
Distinguish competition vs. predatory behavior. Predatory behavior is unlawfully driving competitors out of market.
To prevail, Plaintiff must show Defendant targeted only Plaintiff’s customers and product.
Defenses to Wrongful Interference: Interference was justified or permissible.

13. Intentional Torts Against Property
Trespass to Land
Trespass to Personal Property
Conversion
Disparagement of Property
Slander of Quality
Slander of Title

14. Unintentional Torts (Negligence)
Occurs when someone suffers injury because of the defendant’s failure to comply with a legal duty.
Defendant (tortfeasor) creates foreseeable risk of injury.
If no risk is created, there is no negligence.

15. Negligence--Analysis
Did the Defendant owe the Plaintiff a legal duty of care?
Did the Defendant breach that duty?
Did the Plaintiff suffer a legal injury?
Did the Defendant’s breach of duty cause the Plaintiff’s injury?

16. Negligence Duty of Care and Breach
Duty is based on reasonable person standard.
How would a reasonable person have acted under the circumstances?
Duty of Landowners to business invitees and tenants to keep common areas safe.
Duty of Professionals to clients (attorneys, CPA’s, doctors)

17. Negligence Injury Requirement and Damages Causation
Plaintiff must suffer a legally recognizable injury.
Not all injuries can be compensated.
Causation
Causation in Fact (“but for” test)
Proximate Cause (foreseeably strong connection)
Palsgraf (1928)

18. Negligence Defenses Assumption of the Risk
Superseding Intervening Cause
Event must be unforeseeable
Contributory Negligence (few jurisdictions)
Plaintiff recovers nothing if he is at fault.
Comparative Negligence (more common)
As long as Plaintiff is less than 50% at fault he can recover a pro-rata share of the verdict.

19. Strict Liability Does not require fault, intent or breach of duty.
Usually involves ‘abnormally dangerous’ activities and risk cannot be prevented.
Dangerous Animals.
Product Liability—manufacturers and sellers of harmful or defective products.

20. Cyber Torts Can a person be liable for a tort committed in cyberspace?
Should an Internet Service Provider (ISP) be liable for the actions of its subscriber?
Who should be liable for “spam” and computer viruses that cause injury?

21. Intellectual Property
Intellectual Property (I.P.) is any property that is the product of an individual’s mind, e.g, books, software, movies, music.
U.S. Constitution protects I.P. in Article I Section 8. Congress shall
“promote the Progress of Science and useful Arts, by securing for limited times to Authors and Inventors the exclusive right to their respective Writings and Discoveries.”
Ownership of I.P. is strategically important in the global economy.

22. Trademarks & Related Property
Distinctive motto, mark or emblem
Stamped or affixed to a product
So that it can be identified in the market.
Statutory Protection for Trademarks
Federal Lanham Act of 1946
Federal Trademark Dilution Act of 1995

23. Trademarks & Related Property
Trademark Registration
U.S. Patent and Trademark Office gives notice to 3rd parties.
A mark can be registered if in use or mark will be used within 6 months.
Trademark Infringement
Unintentional or intentional substantial copying of mark.
Strong marks vs. generic terms.

24. Trademarks & Related Property
Service Mark
Similar to trademark but used for services.
Includes characters in TV and radio.
Trade Names
Applies to a business (not a product).
Trade Dress
Image and appearance of a product or shop (Example: Starbucks coffee stores)

25. Cyber Marks Trademarks in Cyberspace Domain Names Cybersquatting
Trademarks in Cyberspace (example: Nike.com)
Conflicts—ICANN
Cybersquatting
Occurs when 3d party registers a domain name that is the same or similar to another company’s own trade name.
1999 Anticybersquatting Consumer Protection Act

26. Cyber Marks Meta Tags Online Trademark Dilution
Keywords in web pages used by internet search engines.
Playboy vs. Calvin Designer Label
Online Trademark Dilution
Trademarks can be diluted on the web.
Hasbro v. IEG (over candyland.com)

27. Patents Patent Patents for: A Government monopoly that
Gives inventor the exclusive right to
Make, use or sell and invention for 20 years.
Patents for:
Invention
Design
Process (software patent)

28. Patents Infringement Business Process Patents
Manufacture, use or sale of another’s product or design without permission (license).
Business Process Patents
1998 State Street Bank v. Signature Financial ruled that a method of doing business could be patented.
Amazon.com’s “one-click” patent.

29. Copyrights Copyright:
Intangible property right granted by federal statute to the author for life plus 70 years.
Automatic protection.
Work must be original and “fixed in a durable medium.” Ideas are not protected, but the expression of an idea is.

30. Copyrights Infringement Exception: “Fair Use”
Form or expression is copied (does not have to be in its entirety)
Penalties, damages and criminal action are possible.
Exception: “Fair Use”
Certain persons or organization can copy materials without penalty (e.g., education, news, research)

31. Copyrights in Digital Information
Digital media can easily be copied.
Copyright Act of 1976
Copy of a program into RAM is infringement.
Revision or re-sale of freelance authors works can be infringement. NY Times v. Tasini (2001).
MP3 and File-Sharing.
Napster case.

32. Trade Secrets
Trade secrets are confidential, not filed with the government.
Can be customer lists, formulas, pricing, etc.
Theft of trade secrets is now a federal crime under the Economic Espionage Act of 1996.
Cyberspace: employees can easily information to competitors.

33. Licensing
Allows a third party to lawfully use a patent, trademark, copyright or trade secret.
The licensee pays the licensor (the owner of the IP) a fee for use.
U.C.I.T.A. is a uniform code that licenses the use of software.