Court gags on Utah’s ag-gag law

Animal Legal Defense
Fund v. Herbert, No. 13-cv-00679 (D. Utah Jul. 7, 2017)
The court strikes
down Utah’s ag-gag law, relying on Alvarez,
Reed, and the idea that not all access procured by lying is “trespass”
or “harmful.” H/T James Grimmelmann, who thinks the reasoning doesn’t quite
work, perhaps because of the court’s reluctance to rely on the legislature’s
obvious speech-suppressive intent.
A series of
high-profile investigations into agricultural facilities in the mid- to late
2000s spurred a new round of ag-gag laws. While one might once have thought
that film of workers jabbing sick cows in the eye, grinding up live chicks, and
skinning calves alive might have led to increased protections against animal
abuse, it instead mostly led to increased protections against investigation of
agricultural facilities. (One wonders what Upton Sinclair would have thought:
the animal rights organizations aimed for the heart, and apparently hit the
public in the eye.) Utah’s law was introduced, according to its sponsor,
because of “a trend nationally of some propaganda groups . . . with a stated
objective of undoing animal agriculture in the United States.” Another
representative, a farmer, stated that the bill was targeted at “a group of
people that want to put us out of business,” and noted that farmers “don’t want
some jack wagon coming in taking a picture of them.” The sponsor of the Senate
bill said that the bill was meant to address the “vegetarian people that [are]
trying to kill the animal industry” by “hiding cameras and trying to . . .
modify the films and stuff like that.”
Utah’s law
criminalized “obtain[ing] access to an agricultural operation under false
pretenses,” as well as (1) bugging an agricultural operation; (2) filming an
agricultural operation after applying for a position with the intent to film;
and (3) filming an agricultural operation while trespassing.
In 2013, Amy Meyer
became the first person to be charged under the law—apparently the only person
ever charged under an ag-gag law nationwide. She was arrested while filming
what appeared to be a bulldozer moving a sick cow at a slaughterhouse, though
she was on public property at the time and thus not subject to the law. She was
actually charged, though the State dismissed the case without prejudice (!).
This is an interesting case study not of chilling effects (of which more below)
but of licensing effects—the police, whose acts are likely to be far more
important than those of prosecutors, and harder to constrain, felt empowered to
suppress her recording because they had a general sense that some kinds of
recording were illegal, and prosecutors backed them up.
Meyer, joined by
ALDF and PETA, sued. The state challenged their standing. Allegations of
subjective chill aren’t injury in fact, but “a plaintiff need not expose
himself to actual arrest or prosecution to be entitled to challenge a statute.”
In the Tenth Circuit, standing requires (1) that in the past, the plaintiff
engaged in the kind of speech implicated by the statute; (2) that the plaintiff
has a desire, but no specific plans, to engage in the speech; and (3) that the
plaintiff presently has no intention of engaging in the speech because of a
credible threat the statute will be enforced. 
This test was satisfied by all three plaintiffs.  No concrete plans to violate the law were
required.
The state argued
that lying and recording without permission weren’t protected by the First
Amendment at all.  Starting with lying:
lying is speech, but some speech is outside the First Amendment
categorically.  Alvarez, however, says that “lies are not categorically
unprotectable by the First Amendment,” though lies that cause “legally cognizable
harm” are outside of First Amendment protection.  Do the lies targeted here—“obtain[ing] access
to an agricultural operation under false pretenses”—cause legally cognizable
harm?
The state identified
two kinds of harm from such lies: (1) danger to animals and employees, and (2)
trespass. The first is (no pun intended) bullshit.  There was no evidence of it, and no evidence
that it motivated the law’s enactment.  Plus, even though some lies could endanger
animals or employees, not all would, e.g., “the applicant who says he has
always dreamed of working at a slaughterhouse, that he doesn’t mind commuting,
that the hiring manager has a nice tie.”  These are interesting examples because they’re
all, in some way, unfalsifiable.  There
are falsifiable lies that also wouldn’t inherently pose dangers, though they
might be somewhat more correlated with various risks—e.g., the applicant who
claims to have a college degree but doesn’t; the applicant who fails to report
a conviction twenty years ago; and so on. 
Query what the fate of a more specific law targeted at lying about
qualifications ought to be where the job itself doesn’t actually require a
particular qualification.
On to trespass: the
state argued that access to private property procured through misrepresentation
is trespassing, and trespassing is inherently legally cognizable harm.  But misrepresentation doesn’t always negate
consent, and with consent there is no trespass. 
Courts to consider the issue have concluded that it depends on the type
of harm, if any, the liar causes. “[I]f the person causes harm of the type the
tort of trespass seeks to protect—interference with ownership or possession of
the land—then her consent to enter becomes invalid, and from that point on she
is not merely a liar, but a trespasser as well.”  This is where James Grimmelmann objects, as I
understand it; trespass can also be about interference with the right to
exclude, which is why we teach Jacque v.
Steenberg Homes
, and that is inherent in the tort.  But there is still physical trespass that
harms only dignitary interests—as in Jacque—and
dignitary interests have at best a mixed track record against First Amendment
interests (note that I am doing the usual slip/slide between coverage and
protection here, sorry).  Anyway, without
interference with ownership or possession, the consent given to the liar
remains valid even if procured through misrepresentation. 
“Thus, a competitor
who enters a business to steal secrets while posing as a customer is a
trespasser, as is the man who is invited into a home while posing as a
repairman, but is in fact just a busybody looking to snoop around (because both
have interfered with ownership or possession of the property).” 
Okay, that’s a
little harder to explain, because the secret-stealer may cause economic harm,
but not to the land, and the busybody
may not cause any economic harm (and we may have to default to the concept of
high-risk categories, since someone who will lie to get into your house poses
obvious dangers to you and your property). 
Contrast those people with the court’s examples of liars who don’t cause
trespass-type harm: “the restaurant critic who conceals his identity, the
dinner guest who falsely claims to admire his host, or the job applicant whose
resume falsely represents an interest in volunteering.”  These seem to be, respectively, socially
productive, social, and hard-to-see-how-a-jury-could-judge-harm lies.  It’s not clear to me that the concept of
“possession” helps much here in figuring out the difference between lies that
are generally recognized as causing more harm than they’re worth and lies that
aren’t.  It seems that trespass doctrine
itself may encode the same “lies that cause harm” category as Alvarez, with all the resulting
questions about when the inquiry should be retail or wholesale.  I can’t say that feels wrong to me, but it
does expose the structure of Alvarez’s
consequentialism. 
Back to the court’s
reasoning: “the Act here is immune from First Amendment scrutiny under the
State’s trespass theory only if those who gain access to an agricultural
operation under false pretenses subsequently cause trespass-type harm.”  Because such people don’t necessarily cause harm, and the law
sweeps in trivial, harmless lies—“an applicant’s false statement during a job
interview that he is a born-again Christian, that he is married with kids, that
he is a fan of the local sports team,” or the use of a local address for an
applicant who’s out of town—the law is subject to First Amendment scrutiny.
The state argued
that the court should construe “false pretenses” to exclude harmless white lies
and cover only lies material to a person’s access.  That had vagueness implications, and might
cover the applicant who’s really a fan of the crosstown rival rather than the
local team, but regardless, the lie’s materiality to the owner does not itself
make a liar into a trespasser, as several cases about undercover investigations
have held.  So when is an invited guest a
trespasser? The court offered the example of a landscaper who gets a contract
by misrepresenting his previous experience, then does a great job—has he
committed a trespass?  The court found
the “trespass-type harm” standard to be the most persuasive.  The materiality of the lie might render it
harmful, but not in a legally cognizable way. 
Ultimately, absent a further showing of harm, at least some of the lies
criminalized by the law were protected by the First Amendment.
The state then
argued that obtaining a job under false pretenses causes legally cognizable
harm.  Alvarez says: “Where false claims are made to effect a fraud or
secure moneys or other valuable considerations, say offers of employment, it is
well established that the Government may restrict speech without affronting the
First Amendment.” This might work if the law were limited to obtaining
employment under false pretenses, but instead it covered “access,” which would
include “lying about wanting to take a tour, lying about an interest in acquiring
the facility, or lying about wanting to write an article about the facility for
Modern Farmer.”
The First Amendment
also applied to the recording provisions, even though the state argued that the
act of recording wasn’t speech.  But we know that
speech-suppressive laws can operate at different points in the speech
process.  The government can’t circumvent
the right to disseminate a video by regulating the making of that recording
instead.  The state can regulate the act
of recording, but the regulation must be justified and tailored appropriately.
Finally, the state
argued that the First Amendment wasn’t implicated because the law applied only
to speech on private property, to which the First Amendment didn’t apply. The
state’s argument conflated “a landowner’s ability to exclude from her property
someone who wishes to speak” with “the government’s ability to jail the person
for that speech.” The First Amendment is not itself a license to trespass on
private property, or a defense to a private trespass claim.  (But isn’t that exactly what it is here, run
through a concept of consent?  After all,
the state is involved in the enforcement of the private trespass claim, as it
was in NYT v. Sullivan.  One way to think about it, tentatively: what
we are really talking about is the idea of consent, and how some lies don’t
vitiate consent; it might be a different question if the state explicitly
legislated to make clear that a particular lie vitiated consent, but absent
that there is a common-law background against which relevant harm is
defined.  Framed like that, this
implicates the question of standing/legislative competence to identify harm,
but at least provides a roadmap for how one might alter the definition of harm
by finding something new and cognizable.) 
Generally, a
landowner can remove someone from her land even when that person wishes to
exercise First Amendment rights. But the question here was whether the state
could prosecute a person based on her speech on private property, without even
justifying or tailoring the law.  It
can’t.  The state certainly couldn’t
criminalize any criticism of the government on private property.  (Could it criminalize political discussions
without the consent of the property owner on whose property the discussions
were held?  This hypothetical has some
relevance to various proposals about whether, for example, Delaware ought to change its corporate law so that shareholders should
have to affirmatively vote to allow corporations to give political donations.)
What level of
scrutiny applies?  Under Reed, a law is content-based “if
determining whether someone violated the law requires looking at what was said.”
 Still, it’s not entirely clear what
level of scrutiny is applied to anti-lying laws after Alvarez, in which a plurality applied strict scrutiny and two other
Justices applied “proportionality review,” seemingly a variant of intermediate
scrutiny.  The court wasn’t sure what the
“narrowest” ground in Alvarez was,
because it characterized the disagreement among justices as “one of kind—whether
to apply strict or proportional scrutiny—not of breadth.”  That seems odd to me; ordinarily we’d say
intermediate scrutiny was the narrower ground, but in any event, lower courts
have generally applied strict scrutiny to laws implicating lies post-Alvarez.
Here’s where
everything would be much simpler if we just admitted this was a viewpoint-based
law; there’s a reason they’re called “ag-gag” laws.  But instead, the court reasoned that the law
was content-based because determining whether there’s been a lie requires
scrutinizing what the person said.  The
state argued that an anti-lying provision is content-neutral because it barred
all persons, regardless of the message they intend to disseminate, from lying
to gain access to agricultural operations. 
But that’s not the test under Reed.  As for the recording provisions, the question
was whether criminalizing the recording of a particular location was a
content-based restriction.  It was,
because the law criminalizes the recording “of” the operation, not merely any
recording “at” the operation.  “[A]
person standing on agricultural operation property who films a passing flock of
geese is certainly at an agricultural operation, but nobody watching the film
would contend it was a recording ‘of an agricultural operation.’ … In short, if
a person walks off an agricultural facility with a recording, the only way to
know whether she is criminally liable under the Act is to view the recording.”  That’s content-based.
The court’s reading
of Reed is readily defensible (though
it doesn’t address the internal contradictions of Reed, as it has no reason to do
so).  Essentially, at least outside of
commercial speech, only time/place/manner restrictions are exempt from strict
scrutiny.  One might wonder what is left
for the concept of viewpoint-based laws. 
In a pre-Reed world where
content-based meant “not time, place and manner, but covering broad categories
in some way that doesn’t inherently suggest that a government attempt to distort
debate is afoot,” the concept of viewpoint-based regulation did useful work in
identifying government attempts to distort debate that would get scrutiny that
was strict in theory and fatal in fact. 
Post-Reed, who knows?
Unsurprisingly, the
law didn’t survive strict scrutiny.  The
court didn’t have to wade too far into “complex policy questions” because of
the breadth of the law.  The government
identified four allegedly compelling interests: (1) the law protects animals
from diseases brought into the facility by workers; (2) it protects animals
from injury resulting from unqualified or inattentive workers; (3) it protects
workers from exposure to zoonotic diseases; and (4) it protects workers from
injury resulting from unqualified or inattentive workers. The state explicitly
disclaimed reliance on privacy or property interests.  As the court noted, there’s no mention of
worker or animal safety in the legislative history, which was instead “rife with
discussion of the need to address harm caused by ‘national propaganda groups,’
and by ‘the vegetarian people’ who are ‘trying to kill the animal industry.”
Even assuming that
animal and worker safety were actually the reasons for the law, there was no
evidence that the law advanced those interests. 
The targeted harm was entirely speculative, and that can’t establish a
compelling state interest. 
At most, there was “some
evidence in the record of Plaintiffs’ undercover operatives perhaps prolonging
suffering of animals by not reporting abuse in a timely manner.” The state
didn’t claim that the law furthered the interest of quickly addressing animal
abuse by agricultural operations, but even had it done so, the law wasn’t
“remotely” tailored to that goal. 
Several states require employees who record abuse to turn over the
recording to authorities within a certain time period.  While not opining on the constitutionality of
such a provision, that would be both more narrowly tailored to and more
effective at addressing delays in reporting animal abuse.
Even if the state
had shown a compelling interest in animal and employee safety, it hadn’t shown
narrow tailoring.  Narrow tailoring
requires that a law be “actually necessary” to achieve the state’s interests,
and may not be over or underinclusive.  The record didn’t show necessity, and was both
hugely overinclusive, criminalizing “the most diligent well-trained undercover
employees, and underinclusive because “it does nothing to address the exact
same allegedly harmful conduct when undertaken by anyone other than an
undercover investigator.”  What the law was perfectly tailored to do was
preventing undercover investigators from exposing agricultural facility abuses.
ß We are
apparently having a general debate over whether, or in what circumstances, courts
can look at what the government officials responsible for a policy were
actually trying to do, based both on what they said and on what they wrote into
the policy.  If you think that the
analysis above was too much work for an obvious conclusion, or that it may have
unintended consequences for much less pernicious laws, as I do, then it may be
useful to rely more heavily on the objectively manifested indicia of intent:
who was targeted?  There’s often no
separate need to ask “why.”

Anyway, as the state
didn’t contend that preventing such exposure was a compelling state interest,
that was the end of the analysis, and of the law.

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Documents from my ICE suit

Available here, via Public Citizen. From what we have, I think it’s fair to say that most seizures are legitimate counterfeits, so to speak.  That doesn’t excuse ICE or the brand owners who supply them with information from the obligation to comply with the law, of course, especially when the exceptions are particularly likely to serve free speech values.  But it’s much better than the alternative.

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Another thought on ICE’s statements

This isn’t
specifically IP-related, but I’m pondering the part of my FOIA suit requesting
training materials for ICE agents relying on case law, etc.  Initially, the ICE spokesperson who responded
to my inquiry said that ICE based its seizure decisions on consultation with
agency and Department of Justice attorneys, including consideration of
“potential fair use provisions and federal circuit-specific case law.”  When ICE didn’t produce any documents
relating to any of that, we used the initial statement as evidence that ICE
hadn’t met its FOIA obligations.  The
court found it perfectly plausible that all ICE used to determine counterfeit
status were manufacturers’ guides, rather than materials of its own.

Now, I will admit
that I too suspected that the initial claims were bullshit,
in the specific sense of being made with complete indifference to their truth
or falsity in order to achieve a non-truth-related conversational aim, that of
getting me to shut up and go away.  (That
worked really well, as you can see.)  But
it’s depressing—I wish I could say extraordinary—that the court didn’t even
count that statement as evidence that such guidance existed.  What does it mean for a democracy when a
court tells us we shouldn’t take official statements seriously, even—maybe especially—statements
made at such a low level about matters that are relatively low-stakes?  Is government only to be trusted when it’s under oath?

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Today in likely unlicensed goods

These Joker fireworks:

And just because the typo is awesome–not a portmanteau word you see that often, or usually want to have go together:

“open cap to explose the fuse”

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NFL is advising ICE to seize obvious parodies, my FOIA suit reveals

When last I reported on this, the judge had ordered ICE to unredact materials showing company advice to ICE to seize parody merchandise, since such merchandise wasn’t counterfeit and there could be no legitimate law enforcement interest in keeping this advice from the public.  Indeed, ICE’s subsequent production showed that, like the NHL, the NFL has instructed ICE that obvious parodies/nonconfusing uses are counterfeit:

From NFL manual: Dallas Sucks shirt is counterfeit because “NFL licensed merchandise will never favor one Club over another or make derogatory use of another Club’s marks”

Another supposedly counterfeit shirt showing Minnesota player urinating on Green Bay Packers logo inside outline of Wisconsin

So, what do we know?  (1) Despite ICE’s initial claims to me via its spokesperson and a lawyer, ICE relies only on industry guides to identify counterfeits, not on any independent sources.  (2) Those industry guides identify what they don’t like, not what is within the scope of counterfeit goods.  (3) Most of what ICE seizes is truly counterfeit, but when it seizes parody merchandise, it implicates First Amendment interests in free speech.

What next?  (1) ICE should improve its guidance to agents, though I’m not sure how that is best to be accomplished.  (2) Industry guides should limit themselves to true counterfeits.  I will note that thus far it doesn’t seem that clothing brands, which also provided guides to ICE, overreached in the same way, so it can be done.  Calling the NFL/NHL!

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NFL is advising ICE to seize obvious parodies, my FOIA suit reveals

When last I reported on this, the judge had ordered ICE to unredact materials showing company advice to ICE to seize parody merchandise, since such merchandise wasn’t counterfeit and there could be no legitimate law enforcement interest in keeping this advice from the public.  Indeed, ICE’s subsequent production showed that, like the NHL, the NFL has instructed ICE that obvious parodies/nonconfusing uses are counterfeit:

From NFL manual: Dallas Sucks shirt is counterfeit because “NFL licensed merchandise will never favor one Club over another or make derogatory use of another Club’s marks”

Another supposedly counterfeit shirt showing Minnesota player urinating on Green Bay Packers logo inside outline of Wisconsin

So, what do we know?  (1) Despite ICE’s initial claims to me via its spokesperson and a lawyer, ICE relies only on industry guides to identify counterfeits, not on any independent sources.  (2) Those industry guides identify what they don’t like, not what is within the scope of counterfeit goods.  (3) Most of what ICE seizes is truly counterfeit, but when it seizes parody merchandise, it implicates First Amendment interests in free speech.

What next?  (1) ICE should improve its guidance to agents, though I’m not sure how that is best to be accomplished.  (2) Industry guides should limit themselves to true counterfeits.  I will note that thus far it doesn’t seem that clothing brands, which also provided guides to ICE, overreached in the same way, so it can be done.  Calling the NFL/NHL!

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a few misrepresentations aren’t commercial advertising or promotion

Solmetex, LLC v. Dental
Recycling, Inc., No. 17-cv-860, 2017 WL 2840282 (S.D.N.Y. Jun. 26, 2017)
The parties compete
in the market for devices for removing particulate from dental office
wastewater. (Did I mention how much I love learning about market niches I never
even considered? This job is the best job.) The court here dismisses defendant
DR’s amended counterclaims against Solmetex. 
In 2009, DR entered into an exclusive marketing contract and licensing
agreement with the Michigan Dental Association and its subsidiary; MDA agreed
to promote DR’s product to its members. Solmetex, upon learning of a 2017
promotion, allegedly made two kinds of misrepresentations about DR’s product to
MDA and another third party.  Solmetex
allegedly told representatives from MDA that DR’s product hadn’t been tested by
a relevant organization, wasn’t compliant with safety standards, and couldn’t
replace Solmetex’s product, and repeated these statements in a C&D to MDA.  DR alleged that these statements were false,
but MDA nonetheless terminated its marketing and licensing agreements with DR
as a result.  Solmetex also allegedly contacted
an unknown representative of the dental distributor Henry Schein and stated
that DR’s devices “were not approved by the EPA …, and infringed a patent.”
In reality, the relevant EPA rule had been put “on hold” by the Trump
administration, and Solmetex had no patents on its devices, but DR lost at
least one sale as a result.
Solmetex sued DR for
allegedly unlawfully marketing its device as equivalent to Solmetex’s product, which
among other things produced counterclaims and then amended counterclaims.  The court found that DR didn’t sufficiently
allege “commercial advertising or promotion” for its Lanham Act claim—it didn’t
plausibly allege that Solmetex’s isolated misrepresentations were disseminated
to the wider purchasing public. Though DR alleged that Solmetex requested that
MDA disseminate the alleged misrepresentations to its members, it didn’t allege
that this actually happened.  So too with
similar allegations about Schein. 
Although DR could plead based on information and belief, “such
allegations must be accompanied by a statement of the facts upon which the
belief is founded.” DR’s sole factual support for alleging that the statements
were widely disseminated is that a single representative from Schein told a
single member of the purchasing public that DR’s product was not EPA-approved
and had infringed upon a patent. Even assuming that Solmetex was plausibly the
source of Schein’s misrepresentation, this allegation didn’t support the
inference that Solmetex conducted “a wide-reaching false advertising campaign
disseminated to the wider purchasing public,” as required.
The common law
unfair competition counterclaim also failed. 
In New York, that’s misappropriation. 
Product disparagement generally involves no misappropriation and
therefore must be plead as a claim for trade libel, which it was not here.  Alleged violations of Delaware and
Massachusetts consumer protection statutes also failed. Delaware’s Deceptive
Trade Practices Act required a “pattern [ ] of deceptive conduct,” not alleged
here; two instances of deceptive conduct weren’t enough.  Massachusetts Gen. Laws c. 93A requires that
the conduct “(1) fall within at least the penumbra of some common-law,
statutory, or other established concept of unfairness, (2) it must be unethical
or unscrupulous, and (3) it must cause substantial injury to a consumer or
another businessman.” But DR didn’t get past the first element because it hadn’t
successfully alleged another wrong.
Tortious interference:
DR alleged that Solmetex’s false representations caused MDA to terminate its
marketing and licensing agreements with DR, but didn’t allege that MDA breached
a contract by doing so. DR also failed to plead that Solmetex acted solely out of malice, or used dishonest,
unfair, or improper means, as required for a tortious interference claim. While
misrepresentations can constitute dishonest, unfair, or improper means, they
must rise to the level of an independent tort to do so.

Trade libel/slander:
disparaging DR’s product allowed only a claim for trade libel, not
slander.  The trade libel claim failed on
the merits.  Trade libel requires both
malice and special damages.  Special
damages requires the victim to name the individuals “who ceased to be
customers, or who refused to purchase,” and itemize “the exact damages.” The
counterclaims itemized damages only with regard to one lost sale as a result of
misrepresentations by Schein. Assuming that Solmetex was the source of these
false statements, DR didn’t plead allegations that the unnamed Solmetex
representative knew the statements were false, entertained serious doubts as to
the statements’ truth, or spoke solely out of spite or ill will, as required
for malice. DR admitted that the representation that its device was not
EPA-approved was true (albeit misleading), and didn’t allege that Solmetex’s
employees were generally familiar with the company’s patents (or lack thereof).
(An interesting variation on corporate knowledge or the lack thereof, since a
corporation can only act through its agents; if the right hand doesn’t know
what the left hand has patented, then apparently there can’t be malice.)

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FilmOn’s chutzpah doesn’t pay off; labeling it a site of (c) infringement is protected by anti-SLAPP law

FilmOn.com v.
DoubleVerify, Inc., 2017 WL 2807911, No. B264074 (Cal. Ct. App. Jun. 29, 2017)
FilmOn, an
Internet-based entertainment media provider, sued DoubleVerify, a provider of
authentication services to online advertisers, for trade libel and related
claims for falsely classifying FilmOn’s websites under the categories
“Copyright Infringement-File Sharing” and “Adult Content” in confidential
reports to certain clients that subsequently cancelled advertising agreements
with FilmOn. The court of appeals affirmed the grant of DoubleVerify’s
anti-SLAPP motion.  DoubleVerify was
engaged in conduct in furtherance of its constitutional right of free speech in
connection with an issue of public interest, even though its information was
provided confidentially and not disseminated.
DoubleVerify argued that
its reports concerned matters of public interest because the prevalence of
adult content and copyright infringement online had received attention from
both the public and government regulatory agencies. DoubleVerify submitted,
among other things, press reports concerning numerous lawsuits filed by media
production companies against FilmOn, as well as complaints filed and
injunctions entered in a number of federal district courts against FilmOn for
copyright infringement.
The trial court
analogized DoubleVerify’s reports to more public media advisory efforts,
observing it was “not any different, really, than the Motion Picture
Association putting ratings on movies.”  Because of the “massive amount of attention”
paid to FilmOn’s relationship to copyright infringement, DoubleVerify’s reports
clearly concerned a matter of interest to the public. On the merits, the trial court
found FilmOn failed to establish a probability of success because the
undisputed evidence showed DoubleVerify’s statements were essentially true and
DoubleVerify did not make the statements with the intention to harm FilmOn’s
business.
On appeal, FilmOn
argued the statements at issue didn’t concern “a public issue” or “an issue of
public interest,” because (1) the reports contained only “[b]asic
classification and certification decisions” with “little to no analysis or
opinion”; and (2) the reports were made “entirely in private, to individual
companies that subscribe to [DoubleVerify’s] services.”  The anti-SLAPP statute doesn’t define the key
terms, but it should be construed broadly to protect free speech.  Thus, an issue of public interest is any
issue in which the public is interested, though mere curiosity isn’t
enough.  Moreover, the breadth of the
statute means that it covers even private communications about a public issue.
As for the claim
“[b]asic classification and certification decisions that contain little to no
analysis or opinion are not constitutionally protected activity within the ambit
of the anti-SLAPP statute,” the court of appeals examined All One God Faith,
Inc. v. Organic & Sustainable Industry Standards, Inc. (2010) 183
Cal.App.4th 1186 (OASIS).  In that case, a
commercial trade association sought to develop an “organic” certification for
use by its members with their personal care products. A nonmember competitor
sued, arguing the certification was contrary to federal standards for the term
“organic,” and thus using an “ ‘OASIS Organic’ ” seal would be false advertising.
The court of appeals affirmed the denial of an anti-SLAPP motion, reasoning
that the association wasn’t being sued for its opinion about what made a
personal care product “organic,” but for authorizing its members to use the
seal on their products in the market. While the former might be a matter of
public concern, “certification of commercial products—the activities that [the
plaintiff] seeks to enjoin”—didn’t further such speech, because the protected
conduct, articulating a standard, would be complete before any authorization
occurred.  Thus, the act of placing a
seal on a member product communicated nothing about the proper standards for
labeling a personal care product organic. 
However, FilmOn’s business tort and trade libel claims were based
entirely upon the message communicated by DoubleVerify’s “tags.” And
advertisers only abandoned FilmOn based on the tags because they believed that
the public would be interested in whether adult content or copyright infringing
material appears on a website. Thus, the claims were based on conduct in
furtherance of speech.
Also, the conduct
concerned issues of interest to the public. DoubleVerify showed that the
presence of adult content on the Internet generally, as well as copyright
infringing content on FilmOn’s websites specifically, had been the subject of
numerous press reports, regulatory actions, and federal lawsuits. The public
debate over legislation to curb children’s exposure to adult and sexually
explicit media content also showed that DoubleVerify’s reports identifying such
content on FilmOn’s websites concerned an issue of public interest.  Common sense also supported this conclusion.
Nor did the private
nature of the communications matter. 
It’s just not true that to qualify as speech in connection with an issue
of public interest, “the statement must itself contribute to the public
debate.”

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9th Circuit upholds SF ordinance targeting false advertising by pregnancy centers

First Resort, Inc.
v. Herrera, 2017 WL 2766094, — F.3d –, No. 15-15434 (9th Cir. Jun. 27, 2017)
First Resort, a
nonprofit providing free pregnancy-related services, challenged San Francisco’s
Pregnancy Information Disclosure and Protection Ordinance, which targeted false
or misleading advertising by limited services pregnancy centers (LSPCs). The
court of appeals affirmed the district court’s ruling that the Ordinance was
constitutional and not preempted by state law.
First Resort’s
target clients are “women who are unsure how to proceed with unplanned
pregnancies, including women considering abortion.” It bought keywords such as
“abortion” and “emergency contraception”; its advertising competes with abortion
providers for viewers’ attention. 
Online, it advertised itself “as an unbiased and neutral organization
that provided ‘abortion information, resources, and compassionate support for
women’ with ‘unintended pregnancies’ who are ‘considering abortion,’” promised
to “equip [women] with the resources [they] need to make a well-informed
decision about [their] options,” and offered information about abortion
procedures and costs. “Notably, the website and advertising materials did not
mention First Resort’s anti-abortion stance or that it did not provide
referrals for abortions.”
Further background:
false and misleading advertising by pregnancy clinics is a well-documented
problem.  Some such clinics “frequently
fail to provide medically accurate information” and “the vast majority of
pregnancy centers” contacted during a federal investigation misrepresented the
medical consequences of abortion.  San
Francisco’s City Attorney sent First Resort a letter in 201 expressing his
“serious concerns” about First Resort’s misleading advertisements and asking
First Resort to “correct” its advertising “to clarify that the clinic does not
offer or make referrals for abortion services.”
The city’s ordinance
defined a “[p]regnancy services center” as “a facility, licenced or otherwise
… the primary purpose of which is to provide services to women who are or may
be pregnant, that either (1) offers obstetric ultrasounds, obstetric sonograms
or prenatal care to pregnant women, or (2) has the appearance of a medical
facility.” A limited services pregnancy center (LSPC) is a pregnancy services
center that doesn’t directly provide or provide referrals to clients for abortions
or emergency contraception.”
Under the ordinance,
(a) It is unlawful for any [LSPC], with intent directly or indirectly
to perform pregnancy-related services (professional or otherwise), to make or
disseminate or cause to be made or disseminated before the public …, in any
newspaper or other publication, or any advertising device or in any other
manner or means whatever, … any statement, concerning those services,
professional or otherwise, or concerning any circumstance or matter of fact
connected with the proposed performance or disposition thereof, which is untrue
or misleading, whether by statement or omission, that the [LSPC] knows or which
by the exercise of reasonable care should know to be untrue or misleading.
(b) It is unlawful for any [LSPC], with intent directly or indirectly
to perform pregnancy-related services (professional or otherwise), to make or
disseminate or cause to be so made or disseminated any such statement
identified in subsection (a) as part of a plan or scheme with the intent not to
perform the services expressly or impliedly offered, as advertised.
Before filing an
action, the City Attorney must provide the LSPC with written notice of the
violation and indicate that the LSPC has ten days to cure the violation.  If it doesn’t, the City Attorney can sue,
with penalties from $50-500 per violation.
First, the court of
appeals found that the ordinance was facially valid; it had a constitutional
application and it was not unconstitutionally overbroad or vague, but regulated
only unprotected false or misleading commercial speech.  (I might have gone with “apparent
professional speech” to bolster the commercial speech analysis; whether or not
the centers provide medical services in the ordinary sense, they seem to be
offering medical advice—at least in the limited way targeted by the ordinance.  The professional speech consideration is at
least implicit in the discussion of the services and marketplace at issue.)
First Resort argued
that the Ordinance regulated all advertising, not only false or misleading
advertising, and also that it regulated only noncommercial speech. First, the
Ordinance clearly limited itself to false or misleading speech.  As for commercial speech, “[w]here the facts
present a close question, ‘strong support’ that the speech should be
characterized as commercial speech is found where the speech is an
advertisement, the speech refers to a particular product, and the speaker has
an economic motivation.” These factors are not individually necessary,
however.  In American Academy of Pain
Management v. Joseph, 353 F.3d 1099 (9th Cir. 2004), the court of appeals held
that advertisements for paid medical services constituted commercial speech, as
to a California state law prohibiting doctors from advertising they were “board
certified” in certain circumstances.  The
advertising at issue related to a specific product, medical services, and the
advertiser had an economic motive: to solicit a patient base.
Here, the
ordinance’s purpose was similarly to regulate advertising related to medical
services, and the LSPCs had  “at least
one similar economic motive for engaging in false advertising: to solicit a
patient base.”  However, in American Academy, the patients were
paying clients, and here they were not. The court of appeals declined to limit American Academy to “circumstances where
clients pay for services.”  In this case,
soliciting patients “directly relates to an LSPC’s ability to fundraise and, in
turn, to buy more advertisements.” The joint statement of undisputed facts
included: “First Resort’s employees are encouraged to share client stories because
they are useful in fundraising,” and “[a] majority of First Resort’s
fundraising communications reference the benefit of its services to clients and
often include client stories.” Furthermore, successful advertising directly
affects First Resort’s employees’ compensation, as “[m]embers of First Resort’s
senior management team are eligible to receive bonuses based on criteria which
may include … the number of new clients.” Thus, LSPCs had an economic
motivation for advertising their services.
Moreover, an
economic motive for speech is not absolutely required to make the speech
commercial. The court of appeals pointed to Fargo Women’s Health Org., Inc. v.
Larson, 381 N.W.2d 176 (N.D. 1986), which upheld a preliminary injunction
preventing a “pro-life” pregnancy clinic from engaging in “false and deceptive
advertising and related activity [that] misleads persons into believing that
abortions are conducted at the clinic with the intent of deceptively luring
those persons to the clinic to unwittingly receive anti-abortion propaganda.” Even
though clients didn’t pay for services, the court explained that, “[m]ore
importantly, the Help Clinic’s advertisements are placed in a commercial
context and are directed at the providing of services rather than toward an
exchange of ideas.”  
So too here: the
ordinance is limited to “the pregnancy-related services an LSPC offers in a marketplace
for those services.” Indeed, the record indicated that First Resort viewed
itself as “advertising and participating in a competitive marketplace for
commercially valuable services.” The undisputed facts included First Resort’s
admission that it “views its online advertising as competing with that of
abortion providers for the attention of online viewers,” and that “[t]he
medical services offered by First Resort, such as pregnancy testing,
ultrasounds, and nursing consultations have monetary value.”
Nor was the
Ordinance void for vagueness.  (If it had
been, how could general prohibitions on false or misleading ads have
survived?)  The Ordinance specified that
its purpose was to prevent false or misleading ads about the nature of the
counseling and services provided by LSPCs. A person of ordinary intelligence
could understand what’s prohibited.
For basically the
same reasons, the Ordinance was valid as applied to First Resort.  First Resort’s regulated speech wasn’t
inextricably intertwined with its fully protected speech. First Resort’s
commercial speech about the limited medical services it provides can easily be separated
from its fully protected speech, that containing truthful information about
pregnancy, on its website.  As the City
Attorney’s letter explained, the clinic’s website included “detailed
information about abortion procedures offered at outpatient medical clinics”
and “implie[d] on its ‘Abortion Procedures’ page that First Resort perform[ed]
pregnancy tests and ultrasounds as a prelude to offering abortion as an
outpatient procedure, or referring clients to a provider who performs
abortions.” The Ordinance regulated only misleading aspects of the website,
which could easily be separated from other portions of the website, such as:
“If you have missed at least one period, you may be pregnant …. The only sure
way to know is by having a pregnancy test or pelvic exam.”
Nor did the
Ordinance discriminate based on viewpoint. Whether the Ordinance applies
depends on the services offered, not on the particular views espoused or held
by a clinic. Even if an LSPC chooses not to offer abortions or abortion
referrals for reasons that have nothing to do with their views on abortion,
such as financial or logistical reasons, it’s covered.  Further, the Ordinance regulates LSPCs “because
they engage in false or misleading speech, irrespective of their viewpoints.”  Applying only to the service providers that
presented this “grave threat to women’s health” wasn’t viewpoint-based and
didn’t restrict them from expressing their views.  The motivation
for LSPCs’ false or misleading advertising might be anti-abortion views, but
the Ordinance didn’t target the motivation, only the threat to women’s
health.  Similarly, there was no equal
protection problem based on the Ordinance’s use of a classification based on
the speaker’s identity; rational basis review applied and was satisfied.
Separately, the
Ordinance wasn’t preempted by California’s FAL (a matter that one of the
judges, concurring, would have certified to the California Supreme Court).  “[A]bsent a clear indication of preemptive
intent from the Legislature,” California courts presume that a local law in an
area of traditional local concern “is not preempted by state statute.” However,
preemption applies “if the local law ‘duplicates, contradicts, or enters an
area fully occupied by general law, either expressly or by legislative
implication.’ ” “Local legislation is ‘duplicative’ of general law when it is
coextensive therewith.”  But California
courts have mostly confined duplication preemption to penal ordinances, because
when local and state offenses are duplicative, “a conviction under the [local]
ordinance will operate to bar prosecution under state law for the same
offense.”
The Ordinance here
was civil and created no double-jeopardy bar to a state criminal prosecution for
the same false advertising, and First Resort failed to show that the Ordinance
would interfere with the enforcement of state law.  At least, the lack of a penal component
weighed against finding preemption. 
Also, the laws didn’t bar “precisely the same acts.” The Ordinance,
which only applies to LSPCs and to statements about pregnancy-related services,
was narrower in scope than the FAL in both covered parties and topics.  But First Resort didn’t show that the FAL
covered all acts barred by the
Ordinance—the Ordinance barred untrue or misleading statements whether through
affirmative statements or by omission, while the FAL’s text didn’t mention
omissions.  The Ordinance also regulated
services “expressly or impliedly offered,” while the FAL didn’t mention implied
offers. In addition, the Ordinance barred LSPCs from makng untrue or misleading
statements about pregnancy-related services with the “intent not to perform”
those services “as advertised.” By contrast, the FAL barred untrue or
misleading statements about property or services with “the intent not to sell” them
as advertised. Thus, the Ordinance covered false advertising concerning the
performance of services, regardless of whether those services were  offered for sale.  The enforcement schemes were also entirely
different, with the Ordinance lacking a criminal component that the FAL has.
Judge Tashima’s
concurrence pointed out that many of the things the majority opinion said about
the FAL weren’t really true—for example, the FAL covers omissions where affirmative
statements become misleading because of the omission, which is pretty obviously
the situation targeted by the Ordinance.

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Reading list: unregistered marks in the EU

Verena von Bomhard & Artur Geier, Unregistered Trademarks in EU Trademark Law, Trademark Reporter, May-June, 2017 Vol. 107 No. 3

Abstract: The European Union (“EU”) trademark system is based on registration. Nevertheless, the laws of the EU Member States also protect unregistered rights, and these can be held against the use and registration of later EU trademarks. The article provides an introduction to unregistered trademarks in the EU and their enforcement in proceedings before the EU Intellectual Property Office. 

Excerpt: “[T]he law relating to unregistered trademarks is vastly different from one Member State to another. Some Member States do not recognize unregistered marks at all (beyond Article 6bis Paris Convention); others require varying degrees of market recognition or goodwill to protect trademarks based on use, while Denmark alone within the EU provides protection based on simple use.”

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