Copyright Law | Expert Legal Commentary

July 20, 2009

Facebook v. Power Ventures: Facebook Terms of Use Against Scraping

Facebook v. Power Ventures Inc.

By Tom Zuber and Ryan Smith of Zuber Lawler & Del Duca

Facebook v. Power Ventures: Facebook Terms of Use Against Scraping

A federal court looked to Facebook’s Terms of Use to determine that a third party’s access to Facebook’s user data, though authorized by the users themselves, still constituted unauthorized access. Moreover, because Facebook alleged that in accessing the data, the third party “scraped” more than just the non-proprietary user data -- instead scraping entire Facebook pages, including proprietary content -- the Court found that Facebook’s allegations of copyright infringement, among other claims, were sufficient to withstand a motion to dismiss. The court’s order on the motion to dismiss, found at Facebook v. Power Ventures Inc., ____ F. Supp. ____, 2009 WL 1299698 (May 11, 2009, N.D. Cal.), may make it very hard for networks to access data from third parties without the express consent of those parties.

BACKGROUND

Facebook developed and operates one of the most popular social networking sites. Facebook users can create profiles, join networks, and become “friends” with other users. All Facebook users must register before using the site

Power Ventures operates Power.com, a website that enables its users to aggregate data about themselves that is otherwise spread across various social networking sites and messaging services, including LinkedIn, twitter, Myspace, AOL or Yahoo instant messaging, and others – its motto: “all your friends in just one place.” The idea: Power clients could see all of their friends, view their status updates, profile pages, even send messages to multiple friends on multiple sites, all from one site. Power intended and planned to enable its users to access and include their Facebook profile data on the site.

Power.com and Facebook tried unsuccessfully to work out a deal that allowed Power to access Facebook’s site. Facebook wanted Power to use its authorized developer channels (“Facebook Connect”) to access the data – Facebook Connect (used by more than 10,000 other Web sites) provides less than full unfettered access than direct user access—but Power claims that it could not meet Facebook’s deadlines for doing so. Power let Facebook know that it intended to go forward without using Facebook Connect. Power subsequently signed up for its own Facebook account, agreeing to Facebook’s terms of service, then asked its members who were Facebook users to provide their username and password for the limited purpose of gaining access to their profile information and “scraping” its users’ profile data off Facebook. Power used the scraped information, among other things, to solicit other Facebook users to join Power. While Facebook has copyright claims to its proprietary content and design, it does not own a copyright in its users’ profile data.

Shortly after Power launched its site in December 2008, Facebook sued Power in the Northern District of California for, among other things: direct and indirect copyright and trademark infringement; unfair competition; violations of the CAN-SPAM Act, the Copyright Act, the Digital Millennium Copyright Act (“DMCA”), and the Computer Fraud and Abuse Act; and other claims. Among the damages alleged by Facebook, it claims that the password/log-in information of its users is exposed to Power.com’s allegedly less secure website.

Power moved to dismiss Counts 4 through 8 of Facebook’s complaint – the copyright infringement, DMCA, Trademark infringement, and UCL claims. The District Court denied the motion to dismiss, but granted in part Power’s motion for a more definite statement on its UCL claims. Facebook v. Power Ventures Inc., ____ F. Supp. ____, 2009 WL 1299698 (May 11, 2009, N.D. Cal.) The portion of the order regarding the copyright violation has sparked the most interest among practitioners.

Virtually any “scraping” may constitute a copyright violation

Under Federal law, a plaintiff generally does not have to be terribly specific about the facts that underlie the claims in a lawsuit, so long as the complaint contains sufficient facts to give the defendant “fair notice” of the nature of the claim and its basis. 2009 WL 1299698, at *2-3. As the Facebook court noted, motions to dismiss are not favored by the court, so perhaps it is not particularly surprising that the court denied Power’s motion to dismiss.

What is more surprising – and unsettling to many copyright practitioners – is the broad sweep the District Court made in describing what “scraping” activity may constitute copyright infringement. To reach its decision, the Court relied on Ticketmaster LLC v. RMG Techs Inc., 507 F. Supp.2d 1096, 1106 (C.D. Cal. 2007) (finding that defendant made an unauthorized copy of Ticketmaster’s site each time its automated program accessed the site) and MAI Sys. Corp. v. Peak Computer Inc., 991 F.2d 511, 519 (finding that automatic loading a copy of a web page into RAM creates an unauthorized copy), as well as Facebook’s Terms of Use, which prohibit downloading, scraping, or distributing any part of the Facebook site. While Facebook’s Terms of Use do allow a user to download his or her own content, he may not use “data mining, robots, scraping, or similar data gathering or extraction methods” to do so – those actions are explicitly identified as “unauthorized use.”

The court determined that Power’s efforts fell clearly into the categories of activities explicitly prohibited by Facebook’s terms of use, and therefore its use was unauthorized.

Power argued that users, who authorized Power, had the right to download their own content and therefore Power’s accessing of that information could not constitute copyright infringement, as Facebook had no copyright claim on that information. But Facebook argued that Power’s scraper copied the entire Facebook page on which the user data was located, including all elements of the page that to which Facebook claims a proprietary interest. Court agreed that if Power had to “make a copy of a user’s entire Facebook profile page in order to collect that user content, such action may violate Facebook’s proprietary rights.” 2009 WL 1299698, at *4. Taking Facebook’s allegations in the complaint (that this is in fact how the scraper operated) as true, the Court found that the complaint sufficiently stated a claim for direct copyright infringement and denied the motion to dismiss this claim.

The Court also determined that the complaint sufficiently stated a claim for indirect copyright infringement. The complaint indicated that, through and with the help of Power, Facebook users exceeded their own rights as set forth in Facebook’s Terms of Use. Id.

It is noteworthy that the Court also looked to Facebook’s Terms of Use to find that it sufficiently pled a claim under the DMCA. Power claimed that its use was authorized by Facebook users, who are controlling access to their own content. The Court noted that Facebook’s Terms of Use explicitly prohibited the type and scope of access used by Power, so this argument failed. The Court was further persuaded by Facebook’s allegations that it “implemented specific technical measures to block access by Power.com after Defendants informed Facebook that they intended to continue their service without using Facebook Connect, and that Defendants then attempted to circumvent those technological measures.” 2009 WL 1299698, at *5. Such circumvention is the core of a classic DMCA claim. 

Proceedings since this Order was entered

Some commentators believed that Power’s inability to get significant portions of the complaint dismissed would lead to a negotiated settlement between the parties. But Power surprised a lot of folks when, on July 10, 2009, it responded by filing a countersuit against Facebook in the same case.

In the counterclaims, Power accuses Facebook of unfair competition, restraint of trade, and creating a monopoly. It asks that Facebook be permanently enjoined from “anti-competitive practices” and sought unspecified damages and costs. Power claims that the entry of usernames and passwords to access a website through a third party is common in the industry, and that Facebook itself uses this practice on its own site to allow Facebook users to access personal data and contact information from sites like Yahoo!, AOL, Hotmail, and Gmail. The start-up asserts that Facebook is trying to stifle competition and the development of new technology that enables users to more freely access their own data and use it in a portable manner.

Of the countersuit, Power.com CEO Steve Vachani says, “Although users’ ownership of their own data seems self evident, Facebook has historically been criticized for not respecting its users’ rights regarding their own content.”

Conclusion

This ongoing case provides a couple of lessons for online networks and copyright practitioners alike. First, Facebook’s Terms of Use – its definitions of authorized and unauthorized activity – really carried the day for Facebook. Although Facebook acknowledged a user’s right to access that user’s own data, its Terms of Use put significant conditions on methods of access, likely for the specific purpose of preventing access by groups like Power. Online sites and their counsel should review Terms of Use for the site to ensure that they maximize a site’s ability to protect proprietary information and prevent undesired access by all lawful means possible.  Solid Terms of Use statements can provide a powerful tool for copyright protection, even against parties that did not read those terms.

Second, under the Court’s ruling, only a “scraping” mechanism that could cull out and copy non-copyrighted data without copying any proprietary information could arguably be lawful. Similarly, this ruling suggests that even intermediate or temporary copying of Facebook content for the sole purpose of extracting non-proprietary content may violate Facebook’s rights. Compare that holding with two previous Ninth Circuit cases holding that intermediate copying or another’s copyrighted works for the purpose of extracting non-proprietary information is fair use. See Sega v. Accolade, 977 F.2d 1510 (9th Cir. 1992); Sony v. Connectix, 203 F.3d 596 (9th Cir. 2000) (both cases find that because the ultimate end product of the copying did not infringe on copyrights and because the purpose was pro-competitive, the copying constituted fair use).  The end result: networks will find it difficult to access third party networks through channels other than those established by the third party.

The case is a bit confusing to many in the industry because the operators of most websites (such as all of the others aggregated on Power.com) likely consider Power’s service as free advertising and a way to boost their own numbers. Some sites might see Power’s effort as posing a competitive threat, but the damages articulated by Facebook in its lawsuit might ultimately be relatively small compared to the cost of the litigation. It’s difficult to look at the facts and the claims of this lawsuit and wonder whether it really is based on Facebook’s effort to stifle a perceived competitive threat.

At the same time, it’s difficult to find a lot of sympathy for Power, which deliberately rejected Facebook’s established third-party access channels and instead got its users to provide their sign-on information so Power could circumvent Facebook’s established chain and obtain unfettered access.

In the end, even if Power’s lawsuit proves unsuccessful, such claims are likely to force Facebook to find ways to make its user data more portable and accessible if Facebook wants to retain a dominant market position. Otherwise, users may shift their business to other, more accessible social networks.

LawUpdates.com will follow the developments in this case and file updates as warranted.

About the Authors

Tom Zuber is a Partner of Zuber Lawler & Del Duca, focusing on intellectual property protection and exploitation.

Image Credit: ©iStockphoto.com/mattjeacock

View a PDF of the judicial opinion

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Tom Zuber
Ryan Smith

Companies Mentioned

Facebook, Inc.

Power Ventures, Inc.

Power.com

Also See:

Seltzer v. Green Day: Ninth Circuit Upholds Green Day’s Fair Use of Street Art

Hart v. Electronic Arts, Inc.: Third Circuit: No First Amendment Protection for Using Athlete’s Likeness in Video Game

Metropolitan Regional Information Systems v. American Home Realty Network: Fourth Circuit Rules Web Site Owner Can Enforce Copyright on User-Uploaded Photos

Cariou v. Prince: Court Finds Appropriated but Altered Photos Protected under Fair Use

Golan v. Holder: Divided Supreme Court Upholds Copyright Statute Taking Works Out of the Public Domain

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Companies Mentioned

Copyright Law

The following companies are mentioned in Copyright Law Updates:

MGA Entertainment (HK) Ltd.

Mattel, Inc.

American Society of Composers, Authors, and Publishers

MGA Entertainment Inc.

UMG Recordings, Inc.

Frank Diana City Entertainment

Television Music License Committee

PC Onsite

SESAC, Inc.

RealNetworks, Inc.

AOL LLC f.k.a. America Online, Inc.

Northern Lights Products, Inc. d.b.a. GlowProducts.com

Litecubes, LLC

Poof Apparel Corp.

Derek Andrew, Inc.

Metro-Goldwyn-Mayer Pictures, Inc.

Geoffrey Productions, Inc.

Universal City Studios LLLP

Twentieth Century Fox Film Corp.

Turner Network Television LP, LLLP

Turner Network Sales, Inc.

Turner Classic Movies, LP, LLLP

Simon & Schuster, Inc.

Turner Broadcasting System, Inc.

The Cartoon Network LP, LLP

Paramount Pictures Corp.

NBC Studios, Inc.

Disney Enterprises, Inc.

Veoh Networks, Inc.

CSC Holdings, Inc.

CBS Broadcasting Inc.

Cablevision Systems Corp.

Cable News Network LP, LLLP

American Broadcasting Companies, Inc.

Kamind Associates, Inc. a.k.a. KAM Industries

Westbound Records, Inc.

All Headline News Corp.

Janice Combs Publishing, Inc. d.b.a. Justin Combs Publishing

American Software Development Company, Inc.

Bad Boy Records LLC

Affordable Video Systems, Ltd.

Bad Boy Entertainment, Inc. d.b.a. Bad Boy Records

Dream Games of Arizona, Inc.

Yahoo! Inc.

Rondor Music International, Inc.

MLE Music

American Society of Journalists and Authors

IO Group, Inc.

Metropolitan Regional Information Systems, Inc.

Julie Ann’s, Inc.

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