The litigation in the Yahoo! case took approximately six years and involved multiple appeals, law homework help

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Read the case study on pp. 241-244 of the textbook and answer the following questions:




Questions:

Read the case study on pp. 241-244 of the textbook and answer the following questions:

1. The ligitation in the Yahoo! case took approximately six years and involved multiple appeals and some related criminal proceedings. What does this tell us about the actual costs of complex cyber-litigation?

2. Yahoo!'s French subsidiary, and eventually Yahoo! itself, took all Nazi paraphernalia from the site, complying with French law - what does this say about the foreign court's actual power? What Yahoo! wise to do so, or should it have defied the French court's order?



Read the case study on pp. 273-274 of the textbook and answer the following questions:

3. Suppose that you were brought in to advise the Univerisity in regard to what has happened. In the process it was determined that the University did not want to file a lawsuit. What other strategies would you recommend for them to pursue?

4. With regard to the legal claims in this case, defendants were not liable; do you consider that any ethical obligations were breached?



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TAMBURO v. DWORKIN: 601 F.3d 693 (7th Cir. 2010) FACTS The plaintiff was an Illinois resident and the owner of a dog pedigree program that, after rightfully taking information from other dog pedigree websites, was the subject of retaliation against him by postings on the other company’s websites to boycott plaintiff’s program, as well as blast emails to the plaintiff. The defendants were several owners of dog pedigree websites, some from the United States, one from Canada, and one from Australia. None had any ties with Illinois. Plaintiff contended that these actions by the defendant companies were defamatory and tortiously interfered with his business. The United States District Court for the Northern District of Illinois found that the court lacked personal jurisdiction over the defendants and dismissed the case. The plaintiff appealed. JUDICIAL OPINION The Court of Appeals for the Seventh Circuit was asked to determine whether the transmission of blast emails and boycotting messages about another Internet company can subject the defendant to personal jurisdiction in the plaintiff’s state of residence. The court used the Calder v. Jones test and held that in this case, the defendants “defame[d] and tortiously generate[d] a consumer boycott against [plaintiff] knowing that he lived and operated his software business in Illinois and would be injured there.” On this basis, the court held that the federal district court could exercise personal jurisdiction over the defendants in Illinois. CASE QUESTIONS 1. What test was used in this case to determine that there was jurisdiction over the defendants in Illinois? 2. In the new technological age, there is much litigation on whether one is subject to personal jurisdiction even though he or she had never stepped foot in the jurisdiction where the court was located or, for that matter, even heard of it. What is your opinion on how cases such as this should be decided? 3. Ethical Consideration: The court held in this case that the district court in Illinois had personal jurisdiction over the defendant. Could this result be justified solely on the idea that we want to discourage people from defaming individuals and companies? The Calder and Tamburo cases demonstrate that a court’s jurisdiction can extend as far as the tortfeasor’s injury, even if that injury was caused by using electronic media. Another way that personal jurisdiction might attach is by operation of a website. In the last decade, the courts have considered various uses of websites and to what extent a website operator’s actions or the content of the website can form the basis for the court’s personal jurisdiction over the defendant. The seminal case in this area is widely considered to be Yahoo!, Inc. v. La Ligue Contre Le Racisme Et l’Antisemitisme. YAHOO!, INC. v. LA LIGUE CONTRE LE RACISME ET l’ANTISEMITISME: 433 F.3d 1199 (9th Cir. 2006) While there has been debate over the general topic of Internet jurisdiction ever since the Internet came into existence, concern over facing civil or criminal liability in foreign jurisdictions because of the content of one’s website is a relatively new issue, fostered in large part by the experiences of Yahoo! in France.18 FACTS France had enacted a law making it illegal and punishable with both civil and criminal penalties to display or sell Nazi artifacts. Nazi material was being made available through Internet Service Provider Yahoo!’s online auction service hosted out of the United States (although Yahoo! France complied with the French law). In April 2000, La Ligue Contre Le Racisme et L’Antisémitisme (“LICRA”) and L‘Union des Etudiants Juifs de France (“UEJF”)19 filed suit in a French court, claiming that Yahoo! violated the French Penal Code, which prohibits exhibition or sale of racist materials. The French court found it had jurisdiction and found Yahoo! liable. It ordered Yahoo! to use all means necessary to prevent French users from accessing its auction site. It further order Yahoo! “to remove from ‘all browser directories accessible in the territory of the French Republic’” the “negationists” heading, as well as all links “‘bringing together, equating, or presenting directly or indirectly as equivalent’ sites about the Holocaust and sites by Holocaust deniers.”20 Yahoo! then brought suit in a federal district court in California claiming, and seeking a declaration, that the French court’s order was unenforceable. The court found that it had jurisdiction over the two French organizations.21 It also decided that there was an actual controversy, which was causing a real and immediate threat to Yahoo!, and that enforcement of the French order in the United States would violate the First Amendment of the U.S. Constitution. This decision was overturned by the Court of Appeals for the Ninth Circuit, which concluded that the district court erred in finding that it had personal jurisdiction over the French organizations.22 Jurisdiction in a U.S. court could only be obtained, and Yahoo!’s First Amendment claim heard, if the French parties sought enforcement of the French judgment in the United States—and that had not yet happened. JUDICIAL OPINIONS In the first Ninth Circuit Court of Appeals decision, the three-member court panel stated the familiar test for determining whether jurisdiction existed: Exercise of jurisdiction is consistent with these requirements of “minimum contacts” and “fair play and substantial justice” where (1) the non-resident defendant has purposefully directed his activities or consummated some transaction with the forum or a resident thereof, or performed some act by which he purposefully availed himself of the privileges of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim arises out of or relates to the defendant’s forumrelated activities; and (3) the exercise of jurisdiction is reasonable.23 After applying the test, the court concluded: LICRA and UEJF took action to enforce their legal rights under French law. Yahoo! makes no allegation that could lead a court to conclude that there was anything wrongful in the organizations’ conduct. As a result, the District Court did not properly exercise personal jurisdiction over LICRA and UEJF.24 Yahoo! sought and was granted a rehearing en banc, that is, by the entire 11-member Ninth Circuit Court of Appeals. Eight judges—a majority—decided that California did have jurisdiction over the French organizations based on its actions in California, but that the case should be dismissed for other reasons. There were several opinions issued in the appeal. The Majority (Judge W.A. Fletcher, joined by Chief Judge Schroeder and Judges Hawkins, Fisher, Gould, Paez, Clifton, and Bea) A majority of eight judges concluded that the U.S. district court had properly exercised personal jurisdiction over the defendants. They reasoned that personal jurisdiction could be exercised over the defendants because the French court order required Yahoo! to take actions in California (where Yahoo! was headquartered) and the order was under threat of substantial penalty. In a specific jurisdiction inquiry, we consider the extent of the defendant’s contacts with the forum and the degree to which the plaintiff’s suit is (Ferrera 241-242) Ferrera, Gerald R., Margo E. Reder, Stephen Lichtenstein, Robert Bird, Jonathan Darrow, Jeff. CyberLaw: Text and Cases. Cengage Learning, 01/2011. VitalBook file. UNIVERSITY OF PITTSBURGH v. TOWNSEND: 2007 U.S. Dist. LEXIS 56860 (E.D. Tenn. 2007) FACTS Dr. David Townsend, along with other scientists, worked on Positron Emission Tomograph (PET) imaging at the University of Geneva. (PET imaging is a process by which diagnostic images are created based on the detection of radioactive isotopes injected into patients prior to the scan.) During this time, in 1991 Dr. Townsend conceived the idea of combining a PET scanner with a CT scanner. (CTs use special xray equipment to obtain image data from different angles, and then through computer processing, reassembles the data to show a cross-section of body tissues and organs.) In 1992, Dr. Townsend signed a consulting agreement with another of the Defendants: CTI Molecular Imaging, Inc., a manufacturer of PET scanners. In this agreement, Dr. Townsend assigned all of his intellectual property rights to CTI. The technology was not built out yet though. The University of Pittsburgh then recruited Dr. Townsend to join its faculty as an Associate Professor of Radiology and he was provided with an engagement letter along with a Faculty Handbook. The Handbook contains a section entitled “University Policy on Patents” in which it claims ownership and control of the worldwide patent rights that result from activities of its faculty. Inventors are to receive 30%, and the University is to receive 70% of the net financial returns from the sale, licensing or other transfer of such rights. Dr. Townsend also filled out conflict of interest forms in which he disclosed that he is a paid consultant with CTI, and that a patent application on the PET/CT scanner was filed by CTI. Dr. Townsend commenced work at the University; he applied for and was awarded a grant from the National Institutes of Health (NIH). The funds were to be used to research and build a prototype. Federal grant money is paid directly to the universities and disbursed from there. The prototype was completed in 1998. CTI tested it, and later CTI personnel installed and maintained it at the University. Dr. Townsend testified that there was no NIH funding for the clinical validation of the PET/CT scanner, and that NIH had specifically declined to fund the clinical portion of the process. At the end of the term of this NIH Grant in 1999, Dr. Townsend executed a Final Invention Statement and Certification, along with a report for them, certifying that the invention was “conceived and/or first actually reduced to practice during the course of work under the Grant.” Later on at the suggestion of the University’s Office of Technology Management (OTM), Dr. Townsend submitted an “Invention Disclosure Statement” for the invention, listing him and Dr Ronald Nutt of CTI as co-inventors and CTI as a potential licensee; that it was conceived in Geneva, and first operational in the U.S. in 1998, and that an NIH grant provided support. The form was incomplete; it was unsigned and did not include any statement assigning an interest to the University. [It is not uncommon in technology transfer offices to be provided with assignments at a later date, when the invention is closer to the licensing stages.] In 1999 the University’s Technology Transfer Committee approved the filing of a patent application on the invention described in Dr. Townsend’s Invention Disclosure Statement. The University’s attorneys then filed a provisional patent application for the combined PET/CT scanner listing Townsend and Nutt as co-inventors. On the third page of the application is a form entitled “Statement Claiming Small Entity Status— Independent Inventor,” and there, Dr. Townsend represented that he assigned, granted, conveyed, or licensed rights to CTI. The University evidently did not read this, and proceded under its abiding assumption that it owned the technology. The University elected title to the invention pursuant to the provisions of the Bayh-Dole Act. CTI began the commercial development of the scanner in March 2000. In 2001, University officials asked Dr. Townsend to sever his relationship with CTI and instead work with CTI’s competitor General Electric. Dr. Townsend refused and left the University faculty. Before leaving, Dr. Townsend entered into a Royalty Agreement with CTI, that in consideration of his assignment of patent rights he would receive a royalty rate of $1,500.00 per unit sold. The University claims ownership of this technology asserting that is was assigned to the school. The University alleges that Defendants subverted and misappropriated its rights and interests in valuable technology that was developed collaboratively at its campus; that the wrongful actions include breaches of and interference with the University’s contractual right to joint ownership in the technology, as well as tortious misrepresentations and misappropriation. The Plaintiffs assert that Defendants remained silent in response to the University’s repeatedly stated view that it had an ownership interest in the scanner and associated intellectual property. At no time during discussion the University argues, did any of the Defendants deny that the University had an ownership interest, nor did any of the Defendants indicate that Dr. Townsend would not be executing an assignment in favor of the University. The Defendants filed a motion for summary judgment. JUDICIAL OPINION: JUDGE SHIRLEY In the present case, the facts … are not in dispute. Further, the fact that Dr. Townsend did not assign his interest in the PET/CT scanner invention and the fact that the University was provided with a copy of the provisional patent application are also … not in dispute. The only question that remains is whether the University acted with reasonable diligence upon learning these facts. The issue of the reasonableness of the University’s actions is a question of law for the Court. In the present case, the University concedes that it was aware of the lack of assignment of Dr. Townsend’s intellectual property rights, but contends that the lack of assignment did not raise any “red flags” due to the “continuing affirmations” by the Defendants recognizing the University’s ownership interest. The University’s claim appears to the Court to be more in the nature of a claim of fraudulent concealment. The Defendants’ actions need not rise to fraud or concealment in the strictest sense, that is, with an intent to deceive; unintentional fraud or concealment is sufficient. Mere mistake, misunderstanding or lack of knowledge is not sufficient to invoke the doctrine of fraudulent concealment. The burden is on the Plaintiff to show by clear and convincing evidence that such fraud or concealment occurred. The Court finds that the University cannot carry its burden of demonstrating that the Defendants engaged in acts of fraudulent concealment as there was never an affirmative independent act of concealment upon which the Plaintiff justifiably relied. While the University points to instances where the Defendants remained silent in response to the University’s stated view of its ownership interest, the University cannot show any affirmative act or statement prior to the filing of the patent application where the Defendants made any affirmative statement or conduct re-affirming the University’s position on ownership. Upon careful consideration of the entire record, and viewing facts in the light most favorable to the Plaintiff, the Court concludes that the University reasonably should have known about the Defendants’ failure to acknowledge any ownership interest on behalf of the University as of 1999. Later too, the University received a copy of the provisional patent application, which contained the Small Entity Status—Independent Inventor form listing CTI as the assignee of the technology. This information was available, and the University could have discovered it, through the exercise of reasonable diligence. Motions for Summary Judgment GRANTED. The action is DISMISSED WITH PREJUDICE. Defendants may recover their costs of this action. CASE QUESTIONS 1. Say you were brought in to advise the university—that all of this happened, but they did not want to file a lawsuit. What other strategies do you recommend for them to pursue? 2. How would you rewrite the university’s policies to encompass situations such as this? 3. With regard to the legal claims in this case, Defendants were not liable; do you consider that any ethical obligations were breached? (Ferrera 273-275) Ferrera, Gerald R., Margo E. Reder, Stephen Lichtenstein, Robert Bird, Jonathan Darrow, Jeff. CyberLaw: Text and Cases. Cengage Learning, 01/2011. VitalBook file.
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