A group of broadcast companies worked together to hamper Aereo’s ability to sell its assets at auction after it declared bankruptcy, the now-defunct streaming TV service said in a complaint filed in U.S. Bankruptcy Court in New York Monday. ABC, CBS, Univision, WNET and numerous other broadcasters argued in a series of court filings that Aereo’s network of antennas and other equipment could only be used to infringe broadcast copyrights, the complaint said. The broadcasters ran a "concerted campaign of tortious conduct" that had a “substantial chilling effect” on the sale of those assets in February, the complaint said. During the lead-up to the auction, several prospective purchasers “expressed concern regarding the consequences of purchasing the Debtor’s content-delivery assets given the Broadcasters’ conduct,” Aereo said. Instead of Aereo’s technology being bought by an online video distributor service that could have made use of it, Aereo’s tech was sold “piecemeal” the complaint said. “The Debtor’s patents were sold to RPX Corp., a company specializing in defensive patent acquisitions, for $225,000; the Debtor’s trademarks, domain names and customer lists were sold to TiVo Inc. for $1,000,000; and portions of Aereo’s equipment was sold to Alliance Technology Solutions, Inc. for $320,000.” The value of Aereo’s patents “is highest when owned by an entity actually practicing the technology disclosed in those patents,” the complaint said. The piecemeal sale “forced by the lack of bidders, severely reduced their overall value,” said Aereo. The defunct company is seeking damages to be determined at trial, the complaint said. The Supreme Court found against Aereo in a case concerning its right to retransmit broadcast content, prompting its shutdown and bankruptcy filing (see 1406260071). Several broadcasters contacted for comment on the Aereo complaint declined to respond. NAB declined comment on the complaint.
The “underlying dispute” in Direct Marketing Association v. Brohl -- “whether Colorado’s remote sales tax reporting law violated both the U.S. and Colorado Constitutions” -- was remanded to the 10th U.S. Circuit Court of Appeals, eBay said in a blog post Thursday. “This case remains important to internet-enabled sellers because any final court ruling could serve as a litmus test for other state legislatures that are looking to require out of state businesses to collect and remit sales taxes on purchases made by their residents.” The Supreme Court ruled in favor of DMA's case against Colorado (see 1503030061). In the unanimous decision released Tuesday, the court said interstate and remote merchants can challenge state tax issues in federal court, overturning a previous 10th Circuit ruling (see 1411250042).
Prominent communications and tech companies were among the dozens of firms in a diversity of industries signing off on an amicus brief in favor of “marriage equality” as the Supreme Court prepares to hear Obergefell v. Hodges. Among those adding their names to thee brief were Amazon, Apple, AT&T, Broadcom, Cablevision, Cisco, Comcast, DirecTV, Disney, eBay, Facebook, Google, Hewlett-Packard, Intel, Microsoft, Qualcomm, Twitter and Verizon. The companies said they do business in states that both allow and prohibit same-sex marriage. “It creates legal uncertainty and imposes unnecessary costs and administrative complexities on employers, and requires differential employer treatment of employees who are similarly situated save for the state where they reside,” the brief said. The case examines whether the 14th Amendment requires a state to license a marriage between two people of the same sex or recognize such a marriage that is lawfully licensed and performed in another state. Justices will hear the case April 28.
The Supreme Court ruled in favor of the Direct Marketing Association in its case against Colorado. In the unanimous decision released Tuesday, the court said interstate and remote merchants can challenge state tax issues in federal court, overturning a previous ruling by the 10th U.S. Circuit Court of Appeals in DMA v. Brohl (see 1411250042). DMA CEO Thomas Benton called the ruling a “landmark victory.” The ruling “protects marketers and all businesses from the overreach of state laws,” he said in a statement. “DMA believes national businesses having access to a neutral, federal forum is a critical aspect of our judicial system.” Legal experts told us last year that the case hinged on the high court’s interpretation of the Tax Injunction Act, which says “district courts shall not enjoin, suspend or restrain the assessment, levy or collection of any tax under State law where a plain, speedy and efficient remedy may be had in the courts of such State.” The "terms ‘assessment,’ ‘levy,’ and ‘collection’ do not encompass Colorado’s enforcement of its notice and reporting requirements,” Justice Clarence Thomas said in the opinion. “These terms … refer to discrete phases of the taxation process that do not include informational notices or private reports of information relevant to tax liability,” he said. “Information gathering has long been treated as a phase of tax administration that occurs before assessment, levy, or collection.”
The 3rd U.S. Circuit Court of Appeals will hear oral argument in the FTC v. Wyndham case Tuesday. Wyndham questions whether the FTC has the authority to regulate data security standards of commercial entities (see 1407160030). In June 2012 the FTC filed a complaint against Wyndham and three of its subsidiaries (see 1206270089), alleging Wyndham’s “privacy policy misrepresented the security measures that the company and its subsidiaries took to protect consumers’ personal information” and “failed to safeguard personal information,” which caused “substantial consumer injury” and violated the FTC Act. The U.S. District Court for New Jersey ruled in favor of the FTC. Wyndham appealed and was supported by the American Hotel & Lodging Association, the Electronic Transactions Association and the U.S. Chamber of Commerce. The FTC is supported by the Center for Digital Democracy, Consumer Action, Center for Democracy & Technology and the Electronic Frontier Foundation, Electronic Privacy Information Center and Public Citizen.
Apple was ordered to pay $532.9 million because its iTunes software infringed three patents owned by Smartflash, said a verdict from U.S. District Court in Tyler, Texas. The case, filed in May 2013, alleged that Apple’s software infringed three patents held by Smartflash and originally Patrick Racz and Herman-ard Hulst, who signed the patents over to the company in 2002. The jury ruled Apple’s software infringed on those patents, and did so willfully. Apple said it refuses to pay another company for its own ideas and has been left with no choice but to take the fight up through the court system, in a statement Wednesday. It said Smartflash "makes no products, has no employees, creates no jobs, has no U.S. presence, and is exploiting our patent system to seek royalties for technology Apple invented." The patents covered a portable data carrier for storing data and managing access to the data via payment information and/or use status rules, court documents said. They also cover a computer network that serves data and manages access to data by, for example, validating payment information. The complaint said the parts that infringe on Smartflash’s patents include the software components responsible for buying digital content or applications from iTunes, the software components responsible for providing digital content or apps upon payment validation, the software components that provide in-app payment functionality, the software components that provide in-app advertising functionality, the software components that store payment distribution information indicating to whom payments should be made for purchased digital content or apps, and the software components that install, on a computer or server, any version of iTunes that can access the iTunes Store, any version of the App Store app, or any version of the Mac App Store. A lawyer for Smartflash didn't comment.
Blog writer Jessica Bennett alleges violations of California privacy laws and of federal wiretap statutes, in a complaint against Lenovo for installing Superfish software on a Lenovo Yoga 2 convertible laptop she bought late in 2014. The complaint, filed Thursday in U.S. District Court in San Diego, seeks class-action status and unspecified statutory damages against Lenovo and Superfish, which also was named as a defendant. Lenovo shipped products that included Superfish software between September and December, but the software has been disabled since January, the company said in a statement last week (see 1502190046). Superfish lets consumers view more advertisements, but some privacy advocates consider the software a security threat. Soon after buying the Lenovo product, Bennett "was writing a blog post for a client when she noticed spam advertisements involving scantily clad women appearing on her client’s website," the complaint said. "A few hours later, Plaintiff was doing research for a different client when she saw the same block of advertisements intruding on a different, very well known site. It was then that Plaintiff knew that her computer was infected with Spyware." Lenovo didn't comment.
The Electronic Frontier Foundation asked a U.S. District Court in Newark, New Jersey, to invalidate what the digital rights group calls a "junk patent," said an EFF news release. It said EFF partnered with Durie Tangri to defend Bytephoto.com from what EFF described as an “outrageous patent suit from a company that claims to hold the rights to online competitions on social networks where users vote for the winner.” Bytephoto.com has hosted user-submitted photos and competitions for best photo since 2003, EFF said. In 2007, Garfum.com applied for a patent on the “method of sharing multi-media content among users in a global computer network,” and filed an infringement lawsuit against Bytephoto.com in September 2014. EFF argued that “this kind of abstract idea using generic computer technology cannot be patented” and asked that the patent be declared invalid, in a motion to dismiss, the release said. "It's part of our job to identify stupid patents and to try to get rid of them, and this is one of the silliest I have ever seen," said EFF Staff Attorney Daniel Nazer. "Our client has been running 'vote-for-your-favorite-photo' polls for years, just for fun and the love of photography,” said Nazer, who's also EFF's Mark Cuban chair to eliminate stupid patents. “The idea that you could patent this abstract idea -- and then demand a settlement to go away -- goes against both patent law and common sense," he said. "Patents like this improperly interfere with the ability of people to use the Internet to do things they've been doing in the analog world for generations,” said EFF staff attorney Vera Ranieri. This patent is “interfering with the age-old tradition of like-minded enthusiasts getting together to celebrate their hobbies," Ranieri said: "Demanding a payout for infringement on an obviously bad patent like this one isn't just unfair,” it also is “a chilling effect against those who would want to use the Internet to expand their community." Garfum.com didn't comment.
Two separate Alliance of Artists and Recording Companies (AARC) lawsuits alleging several automakers violated the Audio Home Recording Act (AHRA) were consolidated into one in an order signed Monday by U.S. District Judge Ketanji Brown Jackson. Ford and General Motors and their respective suppliers Clarion and Denso violated the AHRA because they shipped vehicles with CD-copying hard drives without building the Serial Copy Management System into the devices or paying the Copyright Office the required royalties on the hardware's wholesale price, AARC alleged in a July lawsuit (see 1410140084). AARC filed a second complaint in November repeating many of the same allegations against Chrysler and its supplier Mitsubishi. In consolidating the two cases, Brown did so “without prejudice to any future motion to bifurcate proceedings for the purpose of trial,” her order said. Lawyers for Chrysler and Mitsubishi argued the two cases involve "common issues of fact and common questions of law." Brown asked all sides to show cause why the cases shouldn't be combined, and no one objected (see 1501280047).
The Internet Commerce Coalition filed a brief on behalf of Google's case against Mississippi Attorney General Jim Hood (see 1502020047). Google filed a lawsuit in December against Hood, alleging he tried to censor the Internet in an administrative subpoena he filed against the company in October (see 1412190045). Online free speech proponents have argued that MPAA’s alleged involvement in Hood’s subpoena proves the entertainment industry is pursuing alternative strategies to the failed Stop Online Piracy Act and Protect IP Act. Hood’s supporters have asked why a state attorney general shouldn’t be allowed to investigate a company for possible consumer violations and condemned Google’s use of stolen documents in the Sony Entertainment Pictures data breach in the case (see 1412170050). ICC argued in its filing that Hood stepped outside his legal jurisdiction. “Congress has determined that all legal claims involving the right to copy, disseminate, sell, and download works within the subject matter of copyright should be determined solely through a copyright infringement action in federal court,” it said. “State consumer protection laws, such as the Mississippi Consumer Protection Act ('MCPA') which provides the authority for the Attorney General’s Subpoena, are completely preempted in such circumstances.”