Can you agree, when you write something on a popular web site, that the site owns the copyright in your work? Indeed you can, as illustrated by an interesting case that played out recently in federal district court in Boston.
I first wrote about this case — Small Justice LLC v. Xcentric Ventures LLC — in April 2014 (Ripoff Report Has a Fight on Its Hands In Massachusetts). In summary, Richard Goren, a Boston attorney, was defamed by a litigation adversary on the Ripoff Report (a website owned by Xcentric Ventures). Consistent with its expressed policy of refusing to remove reviews, Ripoff Report refused to take down the defamatory posting.
Attorney Goren did not take Ripoff Report’s decision as the end-game – he brought suit against the poster in Massachusetts state court, where he obtained a default judgment. The state court then assigned copyright ownership in the defamatory posting to Goren (who assigned it to Small Justice, the first-named plaintiff in the upcoming federal copyright case).* Small Justice sent a DMCA takedown notice to Ripoff Report, which maintained its refusal to remove the offensive post. Small Justice filed suit in federal court in Boston, asserting copyright infringement (and other claims including, Massachusetts lawyers will not be surprised to hear, “unfair and deceptive practices” under Mass. G. L. c. 93A).
*[note]: Whether a copyright could subsist in the original poster’s review is a separate issue, but apparently everyone assumed the “review” was worthy of copyright protection.
The heart of Ripoff Report’s defense to copyright infringement was that the original poster had granted Ripoff Report and exclusive license, and therefore Small Justice could not force a takedown under the DMCA, nor could it prevail on its claim of copyright infringement. How did Ripoff Report obtain this license from the original poster? By means of an online agreement contained in Ripoff Report’s “terms of service” and accepted by the original poster:
By posting information or content to any public area of www.RipoffReport.com, you automatically grant, and you represent and warrant that you have the right to grant, to Xcentric an irrevocable, perpetual, fully-paid, worldwide exclusive license to use, copy, perform, display and distribute such information and content and to prepare derivative works of, or incorporate into other works, such information and content, and to grant and authorize sublicenses of the foregoing.
The injured attorney claimed that this license was ineffective, and in the judge’s 2014 decision the judge (Denise Casper) was not prepared to rule in Ripoff Rreport’s favor on the issue. She needed a more developed record, and by the time she wrote her most recent decision (issued March 27, 2015), she had it.
Unfortunately, my prediction a year ago (“the law and the facts in this case seem, unfortunately, to favor Xcentric”) proved accurate – Judge Casper concluded that Ripoff Report’s online agreement did grant Ripoff Report and exclusive license. She also held that under the federal Copyright Act the state court’s assignment of the copyright to Small Justice was legally ineffective under a federal statute that prohibits the involuntary transfer of a copyright by a governmental body (yes – they can take your land against your will, but not your copyright).
The decision appears to have arrived at the right conclusion, but it took the long way around getting there. While you might hope that a website would be able to get this right by now, Ripoff Report’s website displayed both an acceptance “checkbox” adjacent to a scrollbox, and separate terms and conditions containing the assignment language. This confusing presentation forced Judge Casper to spend an inordinate amount of time determining whether Ripoff Report’s online assignment was a a “clickwrap” or a ‘browsewrap” agreement, and ultimately conclude that the license fell into the category of a browsewrap:
The terms accompanying the checkbox do not state that “I agree to the terms and conditions” or other such language indicating express accord. By checking the box, the user agrees only to the terms accompanying the checkbox. This means that the terms and conditions, including the grant of an exclusive license, which is paramount to a copyright transfer, constitute a browsewrap agreement.
The court also held, as noted above, that the Massachusetts state court’s order transferring the copyright to attorney Goren was invalid – a straightforward reading of 17 U.S.C. § 201(e) (“no action by any governmental body … purporting to … transfer … any of the exclusive rights under a copyright, shall be given effect under this title”).
Further reading: Court Rejects Bizarre Attempt To Scrub Consumer Review, with comments and an in-depth discussion of the relevant caselaw, by Prof. Goldman and Venkat Balasubramani