flickr user ricksask

On the other hand, college students are also proving increasingly adept in using social media to torment and manipulate their peers, and more of these situations are resulting in discipline.  The entire world is now familiar with the story of Rutgers student Tyler Clementi, who jumped to his death in 2010 after roommate Dharun Ravi surreptitiously used a webcam and iChat to broadcast Clementi’s sexual encounters online.  Earlier this year, sports media got caught up in the “catfishing” scam that fooled college football player Manti Te-o into thinking he had an online girlfriend.

Around the same time that Te-o was in the midst of this scam, two students at Ball State University were actively carrying out a similar plot against a former roommate of theirs at the school.  In the fall of 2011, they created a fictional high school sophomore named “Ashley,” through which they initiated an online relationship with the student (who would come to be referred to only as “Target” in subsequent litigation.)  The plot was so elaborate that the students–Messrs. Zimmerman and Sumwalt–even enlisted the help of an actual teen girl to text with the Target.

Zimmerman and Sumwalt eventually arranged for Target to meet “Ashley” at a movie theater.   But when he showed up, they were waiting for him with a video phone, which they used to record and post the encounter to YouTube with the title “[Target] is a pedophile.”

Target reported the harrassment–which also included on-campus physical pranks–to university authorities, which eventually led to disciplinary action under the school’s Code of Conduct.  Zimmerman and Sumwalt admitted that their actions violated the Code, but later brought suit challenging the university’s right to discipline them.

In April 2013, the US District Court for the Southern District of Indiana rejected their claims and upheld the punishment.  Although universities are not governed by the same First Amendment balancing test that the Supreme Court laid out for public K-12 schools in Tinker–in which schools may punish student expression if it threatens a substantial disruption of the learning environment–the Indiana state statute governing universities’ disciplinary power used similar language.   Specifically, it enabled universities “to prevent unlawful or objectionable acts that … violate the reasonable rules and standards of the state educational institution designed to protect the academic community from unlawful conduct or conduct presenting a serious threat to person or property of the academic community.”

Not only did Zimmerman and Sumwalt maintain that their catfishing scheme was First Amendment-shielded expression, they also argued that it wasn’t “objectionable” under the statute.  The court didn’t buy it.  To the contrary:

The Court fails to see how their actions could not be considered objectionable. Further, it appears from the sequence of events that at least part of the Students’ goal was to “trap” the Target into facing criminal consequences for communicating with someone they wanted him to think was an underage female. Even throughout the disciplinary process, the Students were encouraging Ball State to investigate the Target for criminal behavior, going so far as to state that the Target “has committed a felony of child solicitation…,” and to assert that “[w]e are concerned that the persons involved seem to be expressing indifference to criminal behavior and sheltering the accused.” The Court finds that no reasonable jury could conclude that the Students’ entire scheme, culminating in videotaping the Target at the movie theater and posting the video on YouTube, was not objectionable.

Few reasonable minds could disagree with this conclusion.  As the Court recognized, however, its ruling may stand in opposition to the direction society is moving on this issue.  It took note that the term “catfishing,” which had only been coined in 2010, had already spawned an MTV reality show of the same name, and had become a sufficiently popular source of entertainment that it “ may cause viewers to lose that connection to it being a real event that left people feeling violated and hurt.”

All of this portends that the Ball State incident is highly unlikely to be the last catfishing scheme that school administrators at both the college and K-12 levels will be forced to deal with.

Of course, it also means that the field of available, catchy marks is filling up, which will inevitably lead to disputes between rights holders and trademark infringement litigation.

But for now, I’m just interested in taking note of the various commercial identities that different people and companies are staking out by way of applications and registrations with the U.S. Patent and Trademark Office.  Below are some of the more intriguing and perhaps unexpected examples that I’ve discovered:

MARK: FIELD GLASSES

Description: Downloadable software in the nature of a mobile application for displaying augmented reality information.

App. S/N 85818263

Filed: January 8, 2013

Owner: Civil War Preservation Trust

Mark: CYBERCODE

Description: computer software embedded in smart phones, tablet personal computers and video game players which enables users thereof to use camera devices in such units to read symbols which provide augmented reality of the digital content associated with said symbols.

No: Reg. No. 4314961

Filed: April 4, 2011

Owner: Sony

Mark:  ZOMBIE SLASHER

Description (excerpt): Providing online augmented reality games.

No: 4305868

Filed: June 1, 2011

Owner: Iconosys, Inc.

Mark: 

Description (excerpt):  Computer programming services for creating augmented reality videos and games

Reg No: 4224049

Filed: Apr. 15, 2011

Owner: Liu Qiu Yan

Mark ARBALL

Description:  Computer application software for mobile phones, namely, software for use in playing augmented reality games.

Reg No: May 29, 2012

Owner: Augaroo, Inc.

Mark:   SIGHTSPACE

Description (excerpt): computer hardware and software for displaying augmented reality and virtual reality imagery, and component parts; computer programs, namely, augmented reality programs for commercial and industrial use

Reg No: 4131585

Filed: Aug. 22, 2011

Owner: Limitless Computing Inc.

Mark:  LETTERS ALIVE

Description: Educational software featuring interactive augmented reality platforms to provide instruction in reading.

Reg No: 4032741

Filed: Nov. 11, 2010

Owner:  Logical Choice Technologies, Inc.

Mark: WAAR

Description:  Printed pieces of paper featuring markings in the nature of augmented reality markers for use with software applications; computer game instruction manuals

Reg. No. 4329971

Filing Date: Feb. 11, 2012

Owner: Sony

Mark: 

Description:  Computer software for enabling image recognition and/or augmented reality technology on mobile phones, tablets, and handheld gaming devices; computer software using image recognition and/or augmented reality technology for browsing, searching and delivery of advertising information and entertainment content for use with mobile phones, tablets and handheld gaming devices

Reg No: 4252059

Filed: Sept. 13, 2011

Owner: Zappar Ltd Limited Company

Mark: THART

Description: Entertainment services, namely, production of multimedia augmented reality experiences for entertainment purposes that allow for audience participation available both via the Internet and at live show performances

Reg No: 3344096

Filed: July 1, 2006

Owner: Blanksby, Catherine

Mark: DEADLY TRAINING SCENARIOS… WITHOUT DEADLY CONSEQUENCES

Description: Technical consultation and engineering services in the field of augmented reality

Reg No: 2988623

Filed: Mar. 19, 2004

Owner: Harmless Hazards Training, LLC

And of course, the one closest to my heart:

Mark: AUGMENTED LEGALITY

Description: On-line journals, namely, blogs featuring commentary and information in the field of augmented reality, especially from a legal perspective.

Reg No: 4093521

Filed: May 28, 2011

Owner: Wassom, Brian D.

Ditto, a company of 15, launched just over a year ago.  Its site features sharply executed, webcam-based augmented reality interactivity that shows users what they’d look like wearing any number of frames.

This apparently caught the attention of its more-established competitor, 1-800-Contacts.  According to the EFF, “1-800-Contacts’ CEO went onto Ditto’s website the very day it launched, presumably to investigate the upstart competitor’s new technology. Having seen Ditto’s product, 1-800-Contacts then went out and purchased a patent from a defunct company that claims to cover selling eyeglasses over a network using a 3D model of a user’s face.”  To date, 1-800-Contacts still doesn’t offer a competing service, but it says that it intends to launch one soon on its Glasses.com site.

What angers the EFF even more is the apparent strategy behind the lawsuit.  Rather than seeking a royalty from Ditto, 1-800-Contacts “seems determined to put Ditto out of business. Period.”  Adding insult to injury, 1-800-Contacts chose to file its complaint in Utah, rather than in Ditto’s home state of California or the patent infringement hotbeds of Delaware or Texas.  All of this has the EFF, the fashion press, and even Congress asking whether litigation like this and the patents underlying them threaten to squelch innovation in software development.

With the broader augmented reality industry just beginning to come into its own, now is the right time to be asking these questions.

1-800 Contacts v. DITTO Technologies

(c) flickr user marchange – CC licensed

Now Lennon is at it again with another seven, nearly identical lawsuits filed last month in the U.S. District Court for the Eastern District of Texas.  (Both this court and the one in Delaware are hotbeds for this sort of litigation.)  These lawsuits name Macys Inc., Bloomingdales, Ditto Technologies Inc., Fraimz LLC, Lumondi Inc., Luxottica Retail North America Inc.,  Safilo America Inc., and Tacori Enterprises.  Again, the allegations revolve around “virtual try-on” and “magic dressing room” technology used by these retailers to give customers at home a chance to see on their computers in three dimensions what a product would look like on them.

Just as happened after the prior round of lawsuits, the defendants appear to have deactivated the features on their websites as a precaution.  Whether they launch again will likely depend on how the lawsuits resolve.

This sort of litigation activity is worrisome for the nascent augmented reality industry, which is still made of almost exclusively of small, ambitious start-ups.  ”Magic mirror” and “virtual dressing room” technology has been a staple of early AR innovations, and (as these lawsuits demonstrate) has really begun to catch on with retailers and customers alike.  On the other hand, it isn’t like we didn’t see this coming, either.  As AR starts to attract real money, we can expect it to give rise to at least as many patent fights as the mobile phone industry is currently dealing with.

Let’s just hope that litigation like this doesn’t unnecessarily deter developers from pushing AR technology forward.  The industry has only barely begun to scratch the surface of this technology’s potential.

Click here to read month-by-month summaries of all substantive copyright decisions by federal courts in Michigan, Ohio, Kentucky and Tennessee through March 2013.

I commend the International Association of Speakers Bureaus (IASB) for recognizing the significance of this issue for their members.  The correlation between public speakers and the Federal Trade Commission’s rules for fair online advertising is not an obvious one.  In recent years, FTC has brought a lot of attention to the subject of sponsored celebrity tweets and free gifts given to bloggers in exchange for positive reviews.  By far, however, the focus here has been on the endorsements of consumer products.  Think Kim Kardashian’s promotion of Carl’s Jr. burgers, for example, or the fictional movie star JuliStarz’s endorsement of weight loss pills–the case study used by the FTC itself in its most recent guidance on the subject.

That said, when the FTC uses the term “product,” it actually means “any product, service, company or industry.”  (16 CFR 255.0(d).)  And the principles that the FTC enforces–those of honesty, fairness, and full disclosure–apply to all forms of advertising and subject matter being advertised.

One thing is certain: social media has become a crucial and commonplace element of public speakers’ contracts.  For example, Jenise Fryatt, co-owner/marketing director for Icon Presentations AV for events, wrote that when she was hired to speak at a conference last year, she was asked to:

• record a 60-90 second promotional YouTube video to be posted on the conference site.
• tweet about my specific session and the conference in general at least twice monthly using the event hashtag.
• join the organization’s discussion group on LinkedIn.
• join existing conversations on the discussion group and share details of my session.
• add the event as an one I’m attending and share my participation with my connections on LinkedIn.
• promote my attendance/session on my blog and in my newsletters.

My anecdotal conversations with other bureau representatives confirms that they’re seeing similar terms in other speaker contracts.

Now, there’s nothing wrong with these requirements.  Indeed, they’re a logical attempt by conference organizers to squeeze all the return they can get out of the fees they pay for the speakers’ services.  But in carrying out this social promotion, organizers, speakers, and bureaus alike should be careful not to run afoul of the principles governing social media advertising as articulated by the FTC.

The primary concern in this context is the rule requiring disclosure of “material connections.” Section 255.5 of the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising provides:

When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.

In practical terms, this usually means that an endorser (usually a celebrity or a blogger) must disclose when they have received any form of consideration from the company being reviewed that might suggest any sort of bias on the endorser’s part.  For example, Ann Taylor was investigated by the FTC in 2010 for inviting bloggers to a conference and giving them free gift cards in exchange for online reviews, without disclosing that the bloggers had received these perks.  Hyundai, Nordstrom and other companies have received scrutiny for similar promotions.

Applying these examples to public speakers, we can see that whether or not a post violates these rules will very much depend on the content and context of the message.  The sample tweet from Jenise Fryatt above, for example, does not seem likely to be problematic.  That’s because, instead of making factual representations about the conference, its organizers, or its content, she simply reveals the fact that she’s speaking there, and asks her friends to join her.  Although the tweet doesn’t specifically reveal that she’s being paid to speak, it’s probably safe to assume that readers will usually assume that the speaker is being compensated.

What’s less clear, however, is whether most readers will assume that the tweet stems from a contractual obligation rather than from her unprompted enthusiasm or desire for self-promotion.  It’s equally unclear whether anyone would feel differently about her message if they knew the whole story.  But as the content of the message gets more promotional and less transparent, the risk of liability grows.  So, for example, a speaker who is being paid to post about the conference and does not reveal any connection between himself and the event runs a much larger risk of being investigated or fined.

The safest approach is to always disclose the fact that the speaker is being paid to publish the message.  And to that end, the FTC has clarified the manner of appropriate disclosures.  As the JuliStarz example cited above shows–and contrary to prior understandings–abbreviated hashtags like “#Spon” no longer pass muster; the FTC has made clear that it “prefers” the full word “Sponsored.”  And it has given what appears to be blanket approval for tweets that begin with the word “Ad.”  Hyperlinks to disclosures on separate web pages are not sufficient; the disclosure must be made in direct proximity to the message itself.  And of course, while longer, narrative explanations might be preferable, they are impractical for use on Twitter and other space-constricted social media.

Who bears the risk here?  The FTC continues to make clear that it will focus its limited enforcement resources on the companies behind the advertisements, rather than individual bloggers.  This is logical, because it gets to the source of deceptive messages, and therefore presumably deters other bloggers posting on behalf of the same advertiser.  The FTC is not the only entity that can enforce fair advertising laws, however; state agencies and private competitors can as well.  Moreover, in the case of public speakers, there may be many instances in which the speakers themselves–just like other celebrity spokespeople–carry more commercial cache than the organizers of the individual conferences at which they appear.  And speakers bureaus themselves likewise play an indispensable role in securing engagements and negotiating the terms of speakers’ contracts.

All players in public speaking engagements, therefore have a stake in ensuring that social media promotions of their events stay within the bounds of fair advertising regulations.

In case you were wondering, although I did receive accommodations from IASB for speaking at its conference, it did not ask me to publish this blog post or anything else, and did not compensate me for doing so.

Let me be clear–I’m an enthusiast of these and other “augmented reality” technologies.  I applied to be a Google “Glass Explorer” myself, and I’m still bummed that I wasn’t chosen.  I accept as given the fact that “AR” and other wearable computing devices will soon be ubiquitous throughout society, and in many respects that’s exciting.  But one reason I wanted a Glass headset of my own was to help people start coming to grips with the fact that we are going to have to have serious conversations about when and where devices like this should be regulated.  And one context that calls for examination is in the workplace.

The primary concern stems from the device’s ability to record the user’s surroundings in real time, both in audio and video.    Wearable computing pioneer Steve Mann has coined the word “sousveillance” to describe such “recording of activity by a participant in the activity,” or “inverse surveillance.”  Federal and state law, however, have other words that users and employers alike should be more concerned about, such as “eavesdropping,” “invasion of privacy,” and even “corporate espionage.”

Let’s start with video recording.  One of the selling points of digital eyewear (and of similar devices already on the market, such as the Looxcie bluetooth headset) is that they can be “always on,” capturing video of whatever the user is looking at so that those unrepeatable experiences won’t be missed by fumbling around for a video camera.  Both devices also have a “broadcast” feature (Looxice via Facebook, Glass via Google Hangouts) that allows others in remote location to see what the user sees in real time.

But some people who have no problem with you looking at them will object to you recording them.  For example, some of the first establishments to already ban Glass have been strip clubs.  Even workplaces that aren’t clothing-optional have plenty of places in which individuals expect privacy–such as bathrooms, corporate meetings, and closed-door offices.  Recording someone in a place where they have a reasonable expectation of privacy is called “eavesdropping,” which is punishable as a felony in many jurisdictions, and can create civil liability for invasion of privacy in any court.

Also a concern are the documents and computer screens that employees look at every day.  Merely by glancing at confidential documents, an employee wearing a sousveillance device could inadvertently braodcast its contents to the world.

Then there’s the audio component.  The human ear has a marvelous ability to pick one voice out of a crowd and focus on it, ignoring all other conversations.  Recording devices don’t do that.  They pick up everything within earshot, even the confidential conversations that someone wearing a recording device may not even realize they’re hearing.

In addition to their use as recording devices, digital eyewear poses serious concerns as a source for employee distraction.  The reflexive reaction of many employers in the first wave of social media policies was to ban access to Facebook and other social sites for exactly this reason, out of fear that workers would lose all productivity and simply be sucked into reading status updates all day.  This remains a valid concern, even though most workplaces have begun to tolerate limited social media use in the same way that their forefathers learned to cope with personal telephone calls.  But having attractive content in a browser tab on your computer monitor is one thing.  Having that content constantly dangling in your field of vision (as happens with Glass and other digital eyewear), is another thing entirely.  Employees could sit in on meetings and be on Facebook the entire time, literally without anyone else knowing.  (Or worse; a significant percentage of people discussing Glass online today are those who can;t wait to watch porn 24/7.  Some of those people will be in the workplace, which will further test workplace policies against the consumption of such content on the premises.)

So what can employers do?  It seems inevitable that the overwhelming majority of employers will begin by banning digital eyewear in the workplace, just like they did with Facebook before it.  The Joy of Tech comic strip captured all of the foregoing analysis in four simple frames (called “The reality of Google Glass“) not long ago.  It depicted a workplace abuzz over a co-worker’s new Google Glass headset.  By Day Two, the excitement had waned, however, and on Day Three the employee asks, “Why are you all avoiding me?”  A co-workers responds from his cubicle: “We don’t want our pictures and everything we do uploaded to the ‘Net all the time”  Another says: “Besides, you don’t work anymore! All you do is stare into space and grunt!”  By Day Four, the employer has posted a sign banning Glass from the workplace.

There are even handy signs already available under Creative Commons license available for download informing employees and patrons that Glass is banned from the premises.  But it won’t be that simple for long.  Exactly like cell phones and social media websites, it will not be long before AR glasses mature from consumer novelty into enterprise solution.  Developers have long touted digital eyewear for use in architecture, assembly line manufacturing, auto repair, and more.  It may not be long before your employees rely on three-dimensional digital displays rather than instruction manuals to learn and perform their daily jobs.  Commercial drivers already rely on GPS devices for navigation; heads-up display of Google Maps is already a feature of the Glass prototype.  The privacy and other concerns that come with sousveillance devices may soon become yet another inevitable and manageable risk of going to work.

But these issues are upon us, here and now.  Corporate counsel: it may be time to dust off the social media policy and insert a section on “sousveillance devices.”  [Incidentally, the Model Social Media Policy that my firm offers its clients addresses these issues.]

On Tuesday, April 2, 2013, the Securities and Exchange Commission (SEC) posted Release No. 69279 concerning the SEC’s investigation of Reed Hastings, CEO of Netflix.  In December 2012, the SEC had issued a “Wells Notice“ when Hastings had disclosed material company-related information on his personal Facebook page.  Due to the tight restrictions on how and when company “insiders” can release information, the post created a mini-firestorm for Mr. Hastings and Netflix.  That storm seems to have now subsided, however, as the SEC announced it would not take enforcement action against Mr. Hastings and that his post was not in violation of SEC regulations.

For many industry observers (and Reed Hastings himself), this was overdue and welcome news that the SEC was recognizing the influence of social media and that CEO’s are “now free to tweet.”  However, is this Release really guidance or encouragement at all?  The SEC has stated that it is trying to “encourage companies to seek out new forms of communication to better connect with shareholders” but this Release did not give concrete, clear evidence of how to use social media to disclose information.  Therefore, CEO’s might want to sit tight before they post information to any social media account.

For background purposes, the SEC promulgated Regulation Fair Disclosure (“Reg FD”) in 2000.  Reg FD mandates that public companies (“issuers”) make “simultaneous” disclosure of material information to certain groups of people in the investment marketplace.  (17 C.F.R. § 243.100, 17 CFR § 243.100(b)(1))  Information is material if “it is reasonably foreseeable that [the recipient] will trade on the basis of the information.”  If it is material, “[the issuer] must distribute that information in a manner reasonably designed to achieve effective broad and non-exclusionary distribution to the public.” (17 C.F.R. § 243.100. Final Rule: Selective Disclosure and Insider Trading, Exchange Act, Release No. 34-43154, 65 Fed. Reg. 51,716 (Aug. 15, 2000) (the “Adopting Release”)).  If the distribution is “intentional, distribution of the same information to the public must be made simultaneously” to recipients.  The Wall Street Journal also has a wonderfully concise background on the development of the modern disclosure regime.

The question in the Netflix case was whether or not Mr. Hastings’ material company-related statement on his personal Facebook page, relating to how many hours of content the company streamed in a month, was a release of material information to a subset of investors in piecemeal manner.  If it was not simultaneous, broad and non-exclusionary distribution, Mr. Hastings would have violated the law and the SEC would have taken enforcement action. The SEC concluded, however, that Mr. Hastings was not in violation of current SEC guidance and the media cheered the SEC’s embrace of social media.

One big caveat can be found in the text of the Release; by noting that they “remind issuers that the analysis of whether [rules were] violated is always a facts-and-circumstances analysis based on the specific context presented.”  This makes clear that while similar situations might seem innocuous on their face, the SEC is saying “we reserve all rights to backtrack in the future, if necessary.”

While the SEC has “long recognized the vital role of the Internet and electronic communications in modernizing the disclosure system under the federal securities laws and in promoting transparency, liquidity and efficiency in our trading markets,” this Release did not signal the clear embrace telegraphed by pundits. (Commission Guidance on the Use of Company Web Sites, Release No. 34-58288 (Aug. 7, 2008) (“2008 Guidance”). at 10.)  Because the specifics of Mr. Hastings situation are unique and likely the only pre-Release case the SEC will investigate, the conclusions of the Release should be restricted to the specific facts of the Netflix case.  Further, the ease with which information can be released through social media does not lower the bar for Reg FD compliance analysis; the Release notes that “issuer communications through social media channels require careful Regulation FD analysis comparable to communications through more traditional channels” so CEO’s should not feel free to post or tweet away.

This Release coupled with the ease of social media use should not provide a false sense of comfort.  Just because tweets and Facebook posts are inherently unlike voluminous SEC or comparable public disclosures does not mean that issuers can release information without taking affirmative steps.  The Release notes that the SEC “encourage[s] companies to seek out new forms of communication to better connect with shareholders.” However, with respect to social media posts, issuers need to take “steps to alert the market about which forms of communication a company intends to use for the dissemination of material, non-public information, including the social media channels that may be used and the types of information that may be disclosed through these channels.”  The issuer must take those steps in order to ensure “the fair and efficient disclosure of information.”  Basically, you need to say what information will be released and through which channels because “[w]ithout such notice, the investing public would be forced to keep pace with a changing and expanding universe of potential disclosure channels, a virtually impossible task.”

Oddly enough,  the SEC gave Mr Hastings a free pass even though it does not appear that he or Netflix pre-announced the disclosure of this information. In the Release, however, the SEC cautions that “even if the individual in question has a large number of subscribers, friends, or other social media contacts, such that the information is likely to reach a broader audience over time,” the issuer must have given prior notice or else they risk running afoul of Reg FD mandates.  So it appears there is a rule, but it is unclear how it will be applied.

The Netflix case and Mr. Hastings’ release of information was curious.  It clearly caught the SEC off guard and touched on an inherently unclear area of the law surrounding public disclosures.  As Dan Primack noted, was ignorance a defense in this case?  This may explain why the guidance differs from the facts.  However, the SEC did take meaningful steps to try and clarify the law around intentional public disclosures of material information through a social media channel.

The question at the end of the day is whether the steps to clarify the law were helpful.  The Wall Street Journal asks what it means for investors and companies but there is not enough information to guess with any precision because of the wording of the Release. Ultimately, until further clarification is released, appropriately heightened levels of caution should be used when interacting with the investing public as some of the media coverage does not necessarily match the tone of SEC Release  No. 69279.

This content has been added to Wassom on Social Media Law, my ever-evolving e-treatise on the law of social media.

SOURCES:

http://finance.fortune.cnn.com/2013/04/02/secs-social-media-policy-falls-short/?iid=SF_TS_Lead (April 4, 2013- Why the SEC Policy/Release is not enough)

http://finance.fortune.cnn.com/2012/12/07/netflix-hastings-sec/ (December 7, 2012- Wells Notice information)

http://blogs.wsj.com/corporate-intelligence/2013/04/02/faq-the-sec-and-social-media-disclosure/ (April 2, 2013- WSJ review of the SEC Release)

http://online.wsj.com/article/SB10001424127887324020504578399121651488166.html?mod=WSJ_hp_LEFTWhatsNewsCollection (April 2, 2013- WSJ review of disclosure rules)

http://dealbook.nytimes.com/2013/04/03/c-e-o-s-now-free-to-tweet/ & http://dealbook.nytimes.com/2013/04/02/s-e-c-clears-social-media-for-corporate-announcements/  (April 2/3, 2013- NYT on CEO’s new freedom to tweet)

As with most legal questions about augmented reality (or “AR”), we can’t answer definitively, because no court has yet considered the issue.  But with consumer-level digital eyewear just around the corner, we will soon be faced with questions just like this.  So we’d better start thinking about them.

More specifically, the question I want to consider is: can an owner of something tangible (be it real property, goods, billboards, or even a person) stop me from creating an augmented layer associating digital content with that tangible thing?  Commentators have already analyzed this question from the perspective of “virtual property rights.”  But as I’ve written (here and here), I see that phrase as a misnomer. Although AR creates the illusion that digital data occupies physical space, it’s not really there.  Property law is about the right to exclude others from physical space.  But an infinite number of people can each create their own AR layer superimposing digital data over the same physical space without impeding anyone else’s ability to do so, and without invading the rights of the real property owner.  Therefore, property law doesn’t help us think accurately about the AR experience.

Rather, when my digital device recognizes a person, place or thing and is triggered to augment my view of it with digital information, the experience is much more like clicking a hyperlink on a web page–except that the “web page” is the physical world around me, and the hyperlinked “text” is the person, place or thing that triggered the display.  And just as with a web page, there is someone responsible for writing the short piece of link code and for choosing to associate it with that person, place or thing in the program being run by the digital eyewear.   I want to consider the possibility that this coder’s choice to associate digital content with a tangible object is itself speech protected by the First Amendment‘s prohibition of laws that “abridg[e] … the freedom of speech, or of the press.”

We can get a sense of how courts will answer this question by thinking like judges do–in analogies.  When courts encounter unique factual circumstances (what they call “cases of first impression”), they draw from cases dealing with the most analogous facts they can find.  As I’ve suggested, the best way to understand the three-dimensional “clickable world” is by analogy to the two-dimensional World Wide Web we interact with every day.

The United States Supreme Court has long recognized the Internet as a “dynamic, multifaceted [medium] of communication.”  Its 1997 decision Reno v. ACLU struck down part of the Communications Decency Act of 1996 for infringing online free speech rights.  The Court drew its own analogy to underscore the importance of online speech when it observed that, online, “any person … can become a town crier with a voice that resonates farther than it could from any soapbox.  Through the use of Web pages, mail exploders, and newsgroups, the same individual can become a pamphleteer.”  Soapboxes and pamphlets are historic forms of political expression that were sacrosanct to those who wrote the First Amendment.  The Court’s use of these analogies  conveyed its conviction that there digital speech should receive just as much protection as any form of communication.

Hyperlinks are a key mechanism by which Internet users convey information.  Where an activist 250 years ago would have stood at the street corner handing out written pamphlets, today’s activist conveys his message by posting a tweet containing a hyperlink to a page with more information. By pointing internet users to another publication, a hyperlink says, “look here for evidence that supports what I’m saying.”  It is little wonder, then, that people have long viewed hyperlinks as key tools for expression.  Tim Berners-Lee, the father of the Internet, said it best in 1997: “[t]he ability to refer to a document (or a person or any thing else) is in general a fundamental right of free speech to the same extent that speech is free. Making the reference with a hypertext link is more efficient but changes nothing else.”

The form of augmented reality I’m considering in this article–in which viewing certain people, places or things triggers the display of pre-determined digital content–is little more than a system of three-dimensional hyperlinks–the World Wide Web stretched into genuinely worldwide webbing.  How a user will “click” on these links will vary.  Today’s smartphone-based AR apps often use QR codes as the physical “markers” that trigger the automatic display of digital content.  Google recently made news by obtaining a patent describing a method for doing something similar through AR eyewear.  One example given in that patent was a QR code that presented the user with an option to do something  when he viewed the QR code through AR eyewear.  But the same patent also posits doing the same thing by looking at pre-determined physical objects such as a refrigerator.  Even today’s AR technology no longer relies solely on QR codes; “markerless AR” looks for any pre-programmed shape or pattern and displays the appropriate digital content when it recognizes the object.  Visions of an AR-infused world have long included scenes in which one can walk down the street wearing AR eyewear and seeing digital objects blended into the real world just by looking around.

Exactly like with two-dimensional hyperlinks, however, what a user sees through her AR eyewear when looking at a physical “trigger” depends entirely on the coder’s choice of digital information with which to “link” it.  In most conceivable circumstances, that choice will involve some level of expressive “speech”–especially because the person writing the code can choose from literally any content in the world when making that connection.  In many, if not most instances, the coder will intend to communicate some sort of message through his choice of digital content and in his choice of who or what to associate that content with.  For example, as part of their 2011 Re+Public collaboration, the Heavy Projects and the PublicAdCampaign used AR to ”filter” outdoor advertising and replace it with original street art.  Looking through an AR app, outdoor commercial advertisements were overlaid with political or artistic messages.  One such pointed message caused the image of “Captain Barbossa” in the poster for Pirates of the Caribbean 4 to morph before a user’s eyes into the face of Goldman Sachs CEO Lloyd Blankfein–conveying the artist’s message that he is the “real pirate.”  Similar projects have superimposed digital content onto public murals in a form of augmented graffiti.  Unlike traditional graffiti, however, the art did nothing to impinge upon the “property” rights of those who owned the physical surfaces, and any other artist could come along and “link” entirely different content to the same physical space, viewable through a different app.

Of course,  this technology could (and will) be implemented in creepy, offensive and invasive ways, as well.  For example, popular illustrations of our augmented future have shown facial recognition technology and AR being used to convey messages about people such as “Don’t trust this guy!” or “Slutty Ex-Girlfriend.”  A scene from Daniel Suarez’s novel Freedom(TM) has characters using AR glasses to see credit scores and banking information floating over the heads of everyone around them.  Others have depicted geotags used by thieves to indicate when residents are away from home or have just purchased something worth stealing.

But this is why the courts have never applied the First Amendment’s command that there be “no law” abridging the freedom of speech in an absolutely literal way.  The law has continued to regulate expressive activity that goes beyond the bounds of what we recognize as “free speech,” including defamation, false advertising, criminal conspiracy, and infringement of intellectual property rights.  The same legal boundaries that have governed speech in pamphlets and Twitter feeds will continue to apply in the augmented space.

So to answer the question of whether the First Amendment will protect the right to augment reality, the answer must be “yes–to the same extent that it protects speech in any other format.”  In order to make sure we use the right legal principles and afford the proper level of protection to augmented content, however, it will be important to think clearly about that content and recognize it for what it is: speech.

(c) Flickr user Ninanord, CC BY-SA 2.0 license

The most recent example comes from Gatto v. United Air Lines, Inc., decided on March 25, 2013 by the U.S. District Court in New Jersey.  The plaintiff there, Frank Gatto, was a ground operations supervisor for Jet Blue Airways.  He claims that, while he was unloading bags from an airplane, a nearby United plane bumped a staircase into him, causing him a number of injuries.  As in virtually every personal injury case these days. defense counsel very quickly sought production of Gatto’s social media information, looking for posts that were inconsistent with his alleged injuries.  That was in July 2011.

Gatto signed releases allowing United’s lawyers to get his data from all sorts of websites–even PayPal–but not Facebook.  This, of course, piqued the lawyers’ interest even further, and there was additional motion practice designed to force disclosure of the account.  On December 5, 2011, Gatto changed his Facebook password and gave it to the lawyers so that they could access his account.  One of the defense lawyers used the password and managed to see part of the account, but the other defendant did not.  This caused Facebook to send Gatto a security alert that his account had been accessed by an unfamiliar IP address.  Apparently, Gatto responded by deactivating the account.   On January 20, 2012, his lawyer notified the defense counsel that the account no longer existed and could not be retrieved.

A motion for spoliation sanctions followed.  There was some debate as to whether Gatto affirmatively deleted the accout, or merely deactivated and failed to reactivate it.  The court was even willing to give Gatto the benefit of the doubt on this point, and therefore declined to punish him with monetary sanctions.  Nevertheless, the court agreed to give the jury an “adverse inference” instruction, which permits a jury to infer from that the fact that a document was not produced or destroyed that Gatto withheld it “out of the well-founded fear that the contents would harm him.”  In other words, that the evidence would have contradicted his physical injury claims.  After all, Gatto knew for at least five months that opposing counsel wanted the information.  The account was under his control and “clearly relevant” to the litigation.  Therefore, regardless of Gatto’s intent in destroying the data, he bore responsibility for doing so.

(C) flickr user a4gpa, CC BY-SA 2.0 license

An even worse example of spoliation comes from the case Allied Concrete Co. v. Lester (Vir. Supreme Ct. Jan. 10, 2013).  This was also an injury case, except it was filed by a man, Isaiah Lester, whose wife Jessica was killed in an auto accident.  So  the information on his Facebook page certainly did not contradict the nature of the injuries that he claimed.  They did, however–at least in the judgment of his attorney–cast him in a less-than-sympathetic light in the jury’s eyes.  Specifically, his Facebook account included a photo of Lester “holding a beer can while wearing a T-shirt emblazoned with ‘I ♥ hot moms.’”

Sensitive to the use of social media evidence to discredit litigants, Lester’s attorney told him the next day to “clean up” his Facebook and MySpace accounts by deleting these and other pictures, because ”we don’t want any blow-ups of this stuff at trial.”  Lester deleted the accounts, and his attorney’s office then signed discovery responses denying that he had any such accounts.

After all of this came out during depositions, the Court gave the jury an adverse inference instruction.  Given the obviously willful nature of the destruction, moreover, the court imposed whopping monetary sanctions–$180,000 against Lester personally and $542,000 against his attorney.

These cases are stark warnings of the consequences for deleting social media evidence that may be relevant to litigation. The exact boundaries around what needs to be preserved, and when, will need to be fleshed out by future cases.  For example, both of these cases were fairly extreme instances of parties deleting entire accounts when they obviously should have known better.  What about deleting specific posts or pictures?  What about deleting it before a lawsuit is filed?  These sorts of questions will need to be answered case by case, although there is plenty of precedent from cases in other contexts that can provide guidance.

But one thing is certain: now that courts are savvy to the importance of this evidence, parties will not be able to get away with claiming that they deleted the accounts out of ignorance.

This content has been added to Chapter 20.A of Wassom on Social Media Law, my ever-evolving e-treatise on the law of social media.