Legal Geek No. 169: In Kroger, the Store Shelves Shop You!

Hi, and welcome back to Legal Geek.  This week, we discuss a new technology for retailers that invokes serious privacy concerns that you should know about. 

https://archive.org/details/LegalGeekEp169 

Going back to as early as 2013, the National Retail Federation's annual trade show has featured companies developing consumer monitoring technologies to try and make brick-and-mortar retailers remain competitive with online commerce.  These technologies are based around cameras that image a consumer in a store and then offer targeted advertisements and offers based on the demographics observed of the consumer.

This branch of store technology hit another level a few weeks ago in the 2019 show, as at least one company debuted smart shelves that use camera to detect not just the age and gender of a nearby consumer, but also a mood of that consumer.  This information can be used to gauge consumer reaction to a product on the shelf or an advertisement panel on the shelf, with the end goal being delivery of tailored advertisements at the point of sale that are most effective at leading to purchases.  If this sounds like your experience online, it is because that's precisely what these companies are modeling the technology from, just in an in-person context.

Indeed, some major retailers are already testing smart camera or lenses on store shelves.  Walgreens has a handful of locations where the beverage coolers have display screens rather than glass across the front, with cameras mounted on board to detect where a consumer is directing his or her attention.  A little closer to yours truly, the grocery store chain Kroger has installed test camera units on store shelves in Seattle and Cincinnati suburbs to detect age and gender of shoppers.  So in the future, you may not only be pictured by security cameras in stores protecting against thieves, but also by targeted advertising devices trying to entice you to buy certain products based on your demographics or mood.  If that sounds a bit creepy to you, just know that most privacy law experts agree.

But the retail industry is struggling to keep up with online sellers who have the advantages of tailored ads and the Internet, and so don't be surprised if such technologies become commonplace in major retailers in the next few years.  It will be critical for retailers and shops to be open and honest about these systems as they are adopted so that consumers with privacy concerns can make an informed choice about whether they subject themselves to the new monitoring technology.  One might say it's a brave new world in retail, but we don't want to get too 1984 on you.

The Bottom Line is: just like when mega chains like Wal-Mart challenged the existence of many local mom-and-pop stores in the last couple decades, the in-person retail space is once again challenged to adapt or be left behind by online commerce.  We will see how far retailers and tech companies can go before privacy advocates and the government step in to limit invasions of consumers' privacy, and it shapes up to make a potential interesting legal battlefield for the future.  Now, excuse me while I go figure out how to invent an in-person ad blocker to contest these targeted advertising schemes. 

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Legal Geek No. 168: Comicsgate Leader Lawsuit Update

Hi, and welcome back to Legal Geek. This week, at the request of user Samdu on the reddit, we update you on the latest developments in a lawsuit we initially analyzed a few months ago, that being Richard Meyer, the leader of the Comicsgate movement, suing Mark Waid, a DC/Marvel writer for defamation and tortious interference with contract.

https://archive.org/details/LegalGeekEp168 

As you'll recall, Mark Waid and others put in calls and public pressure to a publisher named Antarctic Press to encourage the publisher to not put to print Richard Meyer's Jawbreakers comic, which was a response to what Meyer saw as progressive bias in the comics industry.  Meyer ended up having to rely on Indiegogo to publish his comic after Antarctic Press dropped him, and the public feud between these men went into court.

Six months ago the case was still early, so I analyzed the likelihood of success of the defamation and tortious interference with contract claims based on the initial pleadings of the parties. Now a few months of discovery have occurred, and most notably, the deposition of Mark Waid was published in court records a couple weeks ago. To put it mildly, the deposition was not great for Waid.

Before getting into the details of the deposition, a little explanation. In U.S. courts, fact finding is usually done by a process called discovery, in which both parties get to request information and documents from the other party while disclosing their own relevant information and documents. Both parties also usually conduct witness interviews as well, and these are known as depositions. 

It turns out that Mark Waid crumbled a bit under that pressure of questions from opposing counsel. He admitted to contacting the potential publisher to explain the controversial views of Meyer before quote "we burned the place to the ground" meaning the industry and public taking it out on Antarctic Press. He essentially admitted to using his position as a man in the industry to influence Antarctic Press to forego publishing Meyer's Jawbreakers comic. Waid simply could not explain away a lot of public audio of him admitting at comic conventions that he participated in stopping Jawbreakers from being published. 

Waid also couldn't corroborate that death threats were made against him by the Comicsgate community, a defensive contention made by Waid in this case. Plus, Waid could not explain away text messages in the record where he basically begs Antarctic Press to not hang him out to dry by saying that Waid bullied or coerced the publisher into not publishing Jawbreakers, and offers to use his industry ties and prowess to print an interview with Antarctic Press to promote their brand after they make the decision to drop Jawbreakers. These text messages all but confirm on the written record that Waid tortuously interfered with the Meyer-Antarctic contract, and Waid couldn't provide any other valid explanation in the deposition.

Thus, my initial opinion of this case has taken a strong turn, as I now think the tortious interference with contract case goes from what I thought was a toss up to clearly in Meyer's favor.  I'm still not sold that the defamation claim will work, but as long as Waid produces so much damning evidence against himself in all these texts, convention brag speeches, and depositions...even that claim may be possible for Meyer's counsel to prove. This is precisely why we have discovery to bring out all the facts available, as it can really change a case. 

We will continue to keep our eyes on this big case in the comics industry, but as of now, I expect Meyer will win on at least one of his claims.  The new Bottom Line is, while these legal claims can be difficult to prove all the elements of, the modern era where every conversation is recorded or put in discoverable writing like text messages makes it a lot easier for good attorneys to dig out the facts and evidence to prove wrongdoing did occur. And when you have a witness in a deposition like Waid who crumbles in response to pressure and questions, a hard case to make can flip very quickly into a win. 

If you want a long form explanation of the deposition transcript and recently published evidence, check out Nick Rekieta on YouTube. He's not one of my favorites, but he does a good job explaining the current status of this case for those who want more. Thanks again to the subreddit for the suggestion to revisit the ever-changing comics case. 

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Thanks for reading. Please provide feedback and legal-themed questions as segment suggestions to me on Twitter @BuckeyeFitzy

Legal Geek No. 167: Scandalous Trademarks hit Supreme Court and a Trek/Seuss Update

Welcome back to Legal Geek. This week, we update you on a case we covered over two years ago regarding a Kickstarter pulled down for a book entitled "Oh The Places You'll Boldly Go," and then turn to this week's Supreme Court oral arguments covering whether the U.S. ban on registering scandalous trademarks is constitutional.

https://archive.org/details/LegalGeekEp167 

Back at the end of 2016, authors of a parody Star Trek/Dr. Seuss mashup book "Oh The Places You'll Boldly Go" had a Kickstarter pulled down for claims of copyright and trademark infringement by Dr. Seuss Enterprises.  At the time we covered it on this segment, I opined that this book likely was fair use under copyright law, but it was a close call.  

Well, the battle over this book did end up going to court, and last month a California district court ruled that this parody mashup was protected by fair use.  The court focused in the fair use analysis on the fact that while "Boldly Go" borrows heavily from the original Seuss work, everything taken is highly adapted or transformed to fit the Trek theme, and also that this book does not appear to substantively negatively affect the market for the original Seuss book, which remains strong.  So count this as a win for creative mashup makers, although it is possible Seuss Enterprises will continue the battle with an appeal to the Ninth Circuit.  

Now we move to today's main topic, that being the oral arguments heard this week at the Supreme Court over the U.S. trademark law's ban on registering trademarks containing scandalous subject matter.  The mark at hand in this particular case is F-U-C-T, which phonetically sounds like a past participle of the well-known profane word.  According to court reporters, the justices went out of their way to avoid saying this trademark and similar examples, making for some fun leaps of language during the arguments with both sides' counsel.

You'll recall that a similar trademark law ban on disparaging marks that disparage groups of people or individuals was struck down as unconstitutional two years ago when the band The Slants took their refusal of trademark all the way to the Supreme Court.  Many trademark law experts opined that it was simply a matter of time before this similar ban on scandalous trademarks would be before the Court, and they were correct.  But the Court during arguments did not seem as eager to strike this ban down as they were to do in the disparaging ban.

One reason for this is that while the ban on disparaging trademarks was seen as viewpoint restriction, which comes with a heightened standard to be constitutional, banning vulgar language might be viewpoint neutral and thus, easier to support as constitutional.  Indeed, some of the justices questioned whether this invoked First Amendment speech protection at all.  On the other hand, the Court was very critical in its questioning of the government's attorney regarding the wildly inconsistent application of this ban on prior trademark applicants.  In one highlight example, Justice Ginsburg noted that some prior trademark applications had been refused not because of this scandalous ban but because they were too similar to other lewd terms that had previously been allowed and registered.  The Court just doesn't think this rule can be applied fairly.

The Bottom Line is, while the U.S. Trademark Office and government probably has an easier case to defend this scandalous ban than they did two years ago in the disparagement ban case, it's hard to see the Supreme Court ruling that there is enough distinction between these bans to keep one but not the other.  I expect this ruling to come in June and we will update you on it when it comes, as one of the biggest trademark decisions of this year's Court term.

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Legal Geek No. 166: Cheaters Never Prosper, even in Grand Theft Auto

Welcome back to Legal Geek. This week, we cover the wrap up to a contentious lawsuit between Take-Two Interactive Software and David Zipperer, a player accused of creating and distributing cheating software for the Grand theft Auto series.

https://archive.org/details/LegalGeekEp166 

David Zipperer agreed to settle his ongoing litigation with Take-Two this past week, essentially admitting all fault and paying an undisclosed sum of money to Take-Two for his actions.  Zipperer worked with a team in the U.S. and Europe to develop and distribute several pieces of software that allowed GTA players to cheat while playing those games, including software known as Menyoo and Absolute.

Take-Two sued Zipperer and claimed that these cheats created unauthorized derivative works of GTA, thereby making them copyright infringement.  Take-Two also claimed that Zipperer tortuously interfered with the contracts made between Take-Two and other players, while also breaching the End-User License Agreement himself.  We've discussed EULA's before on this segment and how they can be very difficult to enforce, but against egregious conduct like what was alleged here, it's still possible to use that EULA to defend a software developer's rights.

The consent agreement signed by both parties after the settlement was reached states that Zipperer agrees he committed all these acts, including copyright infringement and tortious interference with contract.  In exchange for agreeing to an injunction stopping all further development and distribution of cheat software, and the aforementioned undisclosed amount of money, Zipperer gets out of this expensive and contentious lawsuit before it goes to full trial.  So in this case, Take-Two won, but only after considerable cost and effort in court to get to this consent agreement.

One factor that probably helped lead these parties to settle was how hostile the judge had become in recent months over the conduct of both sides' attorneys.  The judge was openly critical of Take-Two asking overbroad questions in discovery and delaying the process to get to trial, alleging that Take-Two was trying to bury the defendant under an unreasonable amount of pretrial filings and discovery requests.  The judge also accused Zipperer's attorney of not dealing with some of Take-Two's discovery inquiries in good faith, calling this attorney the greater sinner in this case.

So at the end of the day, Zipperer and his legal team must have figured the potential loss was going to be worse at trial than whatever the agreement turned out to be, plus everyone including the irate judge gets to move on from this case.

The Bottom Line is, companies like Take-Two with wildly successful game lines like Grand Theft Auto have the resources needed to actually enforce EULA's against bad actors like David Zipperer.  Go figure, the maker of a game encouraging digital fantasy crime is the one to stop a developer of cheating software.

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Thanks for reading. Please provide feedback and legal-themed questions as segment suggestions to me on Twitter @BuckeyeFitzy