Category Archives: Uncategorized

E-Mail Disclaimers

Most individuals now commonly place email signature lines at the end of their email messages. These typically contain the sender’s contact information for the sender and may contain marketing information such as an organization’s logo, slogan or URL. Most also contain some sort of confidentiality notice or disclaimer.

The use of disclaimers likely originated from those used on fax cover pages. Of course, one important distinction is that the ones found on fax cover pages would typically be seen before the attached document, in contrast to email disclaimers which are almost universally appended to the end of a message and consequently not seen until after a message has been read.

An email disclaimer may state that the message is the property of the organization. If the organization’s computer system is used to transmit the message and manage the email system then that’s probably a true statement. Such a statement may not be of much practical benefit with respect to the third party recipients but could be of use to support an argument that the user had notice that their email messages were the property of organization, who could view them from time to time and/or refuse to provide copies if the individual eventually leaves the organization.
An email disclaimer may state that the information contained in the message “may be” confidential and intended only for the use of the addressee. Sending a message with such a provision (particularly if appended to the end of an email message) to a third party that is not otherwise bound by a confidentiality obligation is not likely to create any enforceable obligation upon the recipient. On the other hand, the inclusion of a statement identifying the message as confidential may be very important if the sender’s and recipient’s respective organizations are party to a confidentiality agreement which requires confidential information to be designated as such. However, even in such cases, the use of the word “may” could create problems.

Email disclaimers used by lawyers typically contain a statement that the message “may be” legally privileged. The intent is likely to prevent the sender from accidentally waiving any rights they may have. However, the inclusion of the word “may” makes such a statement vague and if contained on every single email sent by a particular lawyer then it may be questionable whether they would be of much value in supporting an argument for privilege. If they are instead only selectively added to certain messages, particularly without the “may be” component and if placed at the start of a message, then they may be of better use for such purposes. Of course their presence on emails, if actually read by the recipient, may also be helpful in discouraging further dissemination by the recipient.

Some email disclaimers contain an explicit prohibition on certain actions being taken by the recipient. Such a provision may prohibit a recipient from forwarding, printing, copying or otherwise reproducing the message in a manner that would allow it to be viewed by someone other than any individual originally listed as a recipient. Other than the potential enforceability problem, such an obligation could hamper a legitimate action that needs to be taken in response to the information contained in the message.

Finally, some email disclaimers contain certain obligations that purport to bind any person who receives the email in error. They may instruct such a recipient that they “should” immediately notify the sender and then delete the message and/or may state that any use of, reliance on or further dissemination of the message is prohibited. Such provisions are likely not to constitute anything more than a request.

Interestingly, spammers are increasingly including such disclaimers in their emails. However, the purpose is very different. As various organizations and individuals are increasingly using filters to block unsolicited commercial emails, the inclusion of such disclaimers is intended to help make their spam messages resemble legitimate emails and bypass the filters.

Note: The above appeared as a Bits & Bytes article published by Law Times on October 18, 2004.

Search Engine Tricks and Sponsored Links

Top search rankings on major search engines such as Google, Yahoo!, Lycos, Altavista, and others have become an important objective for many online businesses. The goal is to have the name of the company appear on the first page (ideally at the top of the first page) of search results when a search is performed by someone looking for products or services of the type the company offers.

This can be accomplished in one of two ways. The first technique is to buy top placement. Overture Services, an Internet advertising company acquired by Yahoo! last year, pioneered pay¬per-click searches (the Overture service is called Precision Match). Google followed in 2002 with a similar service called Adwords, where sponsored links appear beside results when certain words are searched. In both cases, the sponsored links are sold to the highest bidder using an online bidding system.

Sponsored links have become big business and are expected to generate as much as US$4 billion annually by 2005, according to published reports. Google and others have been trying to get a piece of the action. Unfortunately for them, Overture (then known as had filed a patent on its “system and method for influencing a position on a search results list” in 1999 and had a patent issued on July 31, 2001.

A two-year-old patent infringement action against Google is still ongoing. The second technique is to use various search engine optimization techniques or “tricks” to manipulate the results. In fact, the latest thing for Internet pranksters is something called “Google bombing.” This involves using the same techniques to make your competitor’s or opponent’s name to appear when a search is conducted for negative attributes that are sought to be associated with the competitor or opponent.

The term and technique were invented last year by Stanford University student Adam Mathes who wanted to play a joke on his friend Andy Pressman. Mathes’ goal was to make Pressman’s Web site the No. l Google search result for “talentless hack.” Mathes’ method was to encourage as many people with Web sites as possible to link to Pressman’s site using those words.

Now, more than a year later, Pressman’s Web site is still Google’s No. 1 search result for that phrase.
More recently, an anti-Kerry “waffles” campaign was apparently started by a Pennsylvania law student. Typing “waffles” into Google may bring up some search results about Belgian waffles, but the top link is for the John Kerry for President Web site.

Not to be outdone, Kerry supporters have also been busy. A search on the term “miserable failure” using Google or Yahoo! brings up a link to George W. Bush’s official biography on But then, so does a search for “great president.” The trick is possible because Google indexes more than just the contents of the target Web pages. It also considers what words are used to link to a site.

Fun and games aside, these pranks can also have a sinister side. For example, searching on Google for “Jew” brings up an anti-Semitic link in top place. The same result does not occur with Yahoo!, Lycos, or MSN. While Google has elected not to remove the link or alter its placement, to their credit they have inserted a header on the search results page to explain the offensive search results.” Of course the header is a sponsored link which Google presumably bought from itself. I’d love the see the creative accounting on that transaction.

Note: The above appeared as a Bits & Bytes article published by Law Times on September 6, 2004.

Socan Ruling and E-Commerce

A recent decision of the Supreme Court of Canada will likely be music to the ears of Canadian Internet Service Providers. Society of Composers, Authors and Music Publishers of Canada v. Canadian Association of Internet Providers, 2004 SCC 45, was an appeal initiated by CAIP from a Federal Court of Appeal decision concerning a 1995 application by SOCAN to the Copyright Board for approval of Tariff 22. Tariff 22 proposed a royalty, to be paid by Canadian ISPs, as compensation for one aspect (communication to the public) of the unauthorized sharing of music on the Internet.

SOCAN is a collective society which administers in Canada the copyright in music of Canadian members and foreign members of counterpart societies. The appellants provide retail access to the Internet and include Bell’s Sympatico service and Rogers “High-Speed Internet” service. Rather than go through the more time consuming and expensive route of suing individual users or foreign websites hosting infringing copies of musical works, SOCAN sought a simpler route – the application of a royalty at the ISP level for the ISPs role in supporting the infringing activities of its users.

The FCA had upheld the Copyright Board’s determination that ISPs’ activities were excluded from liability, where they performed a pure intermediary function, under s.2.4(1)(b) of the Copyright Act which provides that persons who only supply “the means of telecommunications necessary for another person to so communicate” are not themselves to be considered parties to an infringing communication.” However, in a 2-1 majority decision, the FCA held that where an ISP in Canada creates a “cache” of Internet material, even for purely technical reasons, they no longer act as a mere intermediary and thus become a participant in the copyright infringement and are liable to that extent under Tariff 22.

When an end-user visits a Web site, the pages and other content initially come from the Internet server which hosts the site. As they pass through an ISP, a temporary copy may be made and stored on its server. If another subscriber of that ISP tries to visit the same page or download the same content shortly thereafter, the information can be fetched from this temporary cache copy rather than having to request it again from the original site for efficiency purposes and to reduce the delay. Cache copies are not retained for long periods of time since if the original files change, users will get out-of-date information. The ISP controls the existence and duration of caches on its own system, although in some cases the website or the end user’s browser may insist on content being delivered from the original Web site.

According to the SCC, the creation of a “cache” is a serendipitous consequence of improvements in Internet technology, is content neutral and, in light of section 2.4(1)(b) of the Act ought not to have any legal bearing on the communication between the content provider and the end user. “Caching” is dictated by the need to deliver faster and more economical service, and should not, when undertaken only for such technical reasons, attract copyright liability.

The SCC held that Section 2.4(1)(b) of the Copyright Act is not a loophole but is an important element of the balance struck by the statutory copyright scheme. As such, it need not be narrowly construed as an exception to copyright liability. The “means” include all software connection equipment, connectivity services, hosting and other facilities and services without which such communication would not occur. So long as an ISP does not itself engage in acts that relate to the “content” of the communications, but confines itself to provide a “conduit” for information communicated by others, then it will fall within s. 2.4(a)(b).

Mere knowledge by an ISP that someone might be using content-neutral technology to violate copyright is not necessarily sufficient to constitute authorization (and thereby incur copyright liability), which requires a demonstration that the defendant did give approval to, sanction, permit, favour, or encourage the infringing content. However, notice of infringing content, and a failure to respond by “taking down” may in some circumstances lead to a finding of “authorization.”

The SCC’s holding regarding caching is consistent with the situation in the US under the Digital Millennium Copyright Act and in the EU under their E-Commerce Directive which mandates member States to exempt ISPs from copyright liability for caching. The decision will also likely be interpreted to protect ISPs from liability for operation of UseNet servers and certain other facilities.

The majority of the SCC also held that to occur in Canada, a communication need not originate from a server located in Canada. The applicability of the Copyright Act to communications that have international participants will depend on whether there is a sufficient connection between Canada and the communications in question for Canada to apply its laws consistently with the principles of order and fairness. A real and substantial connection to Canada is sufficient to support the application of Canada’s Copyright Act to international Internet transmissions in a way that will accord with international comity. Connecting factors would include the situs of the content provider, the host server, the intermediaries and the end user. Canada’s exercise of jurisdiction on transmission originating abroad but received in Canada is consistent with Canada’s general law and also with both national and international copyright practice.

This aspect of the decision will likely provide useful guidance regarding the applicability of many other domestic laws (including consumer protection and privacy legislation) to e-commerce and other Internet-related activities between Canadian residents and foreign websites.

Note: The above appeared as a Bits & Bytes article published by Law Times on August 9, 2004.

Open Source Update

Most commercial software is developed by a single business entity and then licensed to end users subject to restrictions on use, copying and redistribution. It is commonly distributed in machine-executable, object-code form instead of a form which can be more easily interpreted and modified by humans (known as “source code” form) and in such instances the licensee is also contractually prohibited from reverse engineering the code (back into source code form). The inner workings are therefore kept secret and any changes or enhancements require the assistance of the licensor.

However, there has been a movement in recent years to develop software in a collaborate manner, with many different developers each developing pieces, with everyone sharing access to the source code and with everyone being able to obtain the benefits of any future improvements. Such software is commonly referred to as open source software.

The GNU General Public License (GPL) is the most pervasive form of license for open source software. GPL obligates parties who wish to redistribute any software licensed under it, either in original or modified form, to do so under the terms of the license pursuant to which the original software was received. So if a developer modifies open source software that was subject to a license which allowed others to use, modify or redistribute the software without needing the permission of, or having to compensate, the original developers, the modified version must also be distributed on the same basis. The best known example of open source software is Linux, an operating system which competes with Microsoft Windows and was originally modeled after another operating system called Unix.

So basically, under the GPL, the licensor permits the licensee to exercise virtually all of the rights available under copyright with the only obligation being that if the licensee wishes to distribute the software, they must agree to also distribute it under the GPL and grant similar rights to others. However, a licensee is not required to grant any rights to others if it chooses to use the modifications only for itself and to not distribute the modified code to others.

Open source provides users with a number of important advantages – including the ability to acquire programs at low or no cost and the ability to made modifications and enhancements. Unless a user wishes to further distribute the software, there is no obligation to disclose or share enhancements made for their own internal use.

The SCO Group, which acquired rights to Unix through a series of corporate transactions, has sued IBM for dumping allegedly confidential Unix code into Linux. SCO is claiming $3 billion in damages from IBM for breach of confidentiality and wrongful disclosure of Unix code it claims it owns. IBM has denied these claims and filed counterclaims against SCO alleging breach of contract, patent infringement and unfair competition.

SCO has also sued DaimlerChrysler and AutoZone for deploying Linux systems without an SCO license. With Linux becoming common on network servers of major corporations, SCO sent letters to about 1500 large companies demanding they pay per server licensing fees or face legal action

Despite repeated requests, SCO has to date refused to identify the portions of Linux that were allegedly were copied from Unix. This has let some to accuse SCO of being more interested in shaking down Linux users than protecting their copyrights. At least one law professor has also commented that SCO may have difficulty succeeding with their claim because the company has distributed Linux versions under a GPL that requires contributors to renounce their rights to any parts of the system.

The law suits have caused a concern in the open-source movement and may slow commercial acceptance of Linux which has been gaining market share at Microsoft’s expense. They have also highlighted the greater liability risk that arises from using software which contains contributions of software code from thousands of individuals, some of which may be original and some of which may have been misappropriated. They should also sound a warning bell to large companies that as users they are not immune from infringement liability and consequently the importance of negotiating sound intellectual property indemnities in respect of any third party software they license.

Note: The above appeared as an article published by The Lawyers Weekly in June , 2004.

GoogleMail and Privacy Issues

The controversy surrounding Google’s new G-mail system is truly astounding. Just in case you’ve been living under a rock for the last couple of months, here’s the deal. Google has developed a free web-based email service which allows each user to store up to 1 gigabyte of email. But as we know, nothing is truly free, so in exchange, Google would like to display targeted banner advertisements when the email is viewed on their system – similar to what’s done right now when users use the Google search engine.

However, there’s been a privacy backlash because Google’s system would scan the contents of each message for the purpose of generating context-sensitive ads to display. Reading about your cousin’s trip to Miami, well then Google might want to display a banner ad promoting a travel package to the sun spot.

Google describes the process as follows: “Google will display targeted ads and other relevant information based on the content of the email displayed. In a completely automated process, computers process the text in a message and match it to ads or related information in Google’s extensive database. No human reads your mail to target ads or other information without your consent.” This sounds similar to the process used by AOL, Yahoo, MSN and others to scan incoming email for viruses and spam. So what’s the fuss all about?

Sure, some of the provisions in Google’s Terms of Use sound scary – “[you] agree that Google may monitor, edit or disclose your personal information, including the content of your emails, if required to do so in order to comply with any valid legal process or governmental request (such as a search warrant, subpoena, statute, or court order), or as otherwise provided in these Terms of Use and the Gmail Privacy Policy.” However, is this any worst than the rights that Bell reserves in its Sympatico Terms of Use which state “you agree that Sympatico has the right to monitor the Sympatico Network electronically from time to time and to disclose any information as necessary to satisfy any law, regulation or other governmental request, to operate the Sympatico Network or any of the Services properly, or to protect itself or its users in accordance with Sympatico’s Privacy Policy”.

In their privacy policy, Google promises that they will “never share your personally identifying information with any advertiser as part of this service, unless you specifically ask us to do so”. Likewise, some of the obligations Bell agrees to assume pursuant to its privacy policy may limit some of the broad disclosure rights mentioned above when personal information is involved.

If you’re concerned about confidentiality, don’t use Google mail as your primary email service. But then, you probably wouldn’t want to use AOL, Yahoo!, MSN, Sympatico or other external email services either. However, Google mail could still be a great place to archive useful information such as articles you’ve read in online newspapers and magazines.

Hopefully all this attention on Google mail will cause the industry to re-evaulate what confidentiality obligations service providers should be assuming. In any event, there are more important privacy issues to worry about. For instance, how many professionals, including lawyers, have signed up for Blackberry or similar services based on contracts which lack a contractual obligation of confidentiality? We caution clients to sign confidentiality agreements and we spend time arguing over the contents of confidentiality obligations contained in contracts we review for them. But how many of us take steps to ensure that appropriate confidentiality obligations cover the private emails that are replicated from our law firm servers onto the externally located systems? I won’t even mention the uncapped indemnities that many service providers insert in their contracts.

Also consider how many professionals continue to exchange confidential emails without using commonly available and inexpensive public key certificates to encrypt the contents? Almost all popular email programs support a feature called S/MIME which allows the sender to digitally “sign” the messages they send using a “public key” they attach to their messages. The public key can also be used by recipients of their messages to authenticate the sender and can also be used to send them back encrypted messages which can only be decrypted using a “private key”. Private/public key combinations can be obtained from Verisign for as little as $10 per year.

And since we started with a focus on Google mail, one of Google’s other services might be a good place to end this piece. How many of us routinely use Google’s search engine to look for personal and work related information? These searches are saved by Google along with the IP address from where they originated and any associated Google cookie identifier stored on the user’s computer. This information may not necessarily be considered “personal information” because Google does not have sufficient information to tie it back to a particular person – that would require asking your ISP to match up the dynamic IP address assigned to your computer. But how dynamic is an IP address in the world of always-on DSL and cable modem broadband connections? The same IP address may be assigned to a particular home for weeks or months at a time (and most business users often have a fixed/static IP address assigned to them). Then there’s the Google cookie on your computer. Prudence dictates taking out the trash periodically – if you’re using Internet Explorer, select Tools, Internet Options and then Delete Cookies.

Note: The above appeared as a Bits & Bytes article published by Law Times on May 17, 2004.

Voice over IP (VOIP) Update

In a decision issued in February 2004, the Federal Communications Commission in the U.S. ruled that calls utilizing voice-over-IP technology, sometimes referred to as Internet telephony, made from computer to computer are free of government rules, taxes and requirements that are applied to telephone networks. In a statement accompanying the Commission’s order, Chairman Powell likened the technology to other peer-to-peer applications, such as e-mail and instant messaging and confirmed the agency’s “non-regulation” policy of the Internet. The decision, however, left unanswered the question of whether traditional phone regulations might apply to VoIP calls that interconnect with the traditional telephone system.

The recent US developments in this area have renewed calls from the Canadian industry for Ottawa to get its act together. The CRTC is currently “reviewing the facts.” Additional pressure will come from Roger’s introduction of telephone services based on VOIP which are set to be offered in Toronto in 2005. However, while there are still legal uncertainties surrounding the regulatory status of VOIP technology, that doesn’t seem to be slowing its implementation.

VOIP provides a number of significant benefits for business users. First, it eliminates the need for separate voice and data cabling as VOIP telephone sets plug into and run over network cabling. Such phones can therefore be unplugged from one network jack and plugged into another without the need to reconfigure a central telephone switch. The jack can be located in the same office or at another office, even one in another city (assuming the offices are linked through a wide area network).

The use of VOIP by residential users is expanding quickly. US-based VOIP telephone providers, such as Vonage, have been aggressively marketing local telephone phone service over broadband Internet connections. Vonage even offers 416 area code numbers. As previously mentioned, Canadian cable companies will likely utilize VOIP technology to compete with the telephone companies. Already one Canadian long distance provider, Primus, has begun offering a broadband service.

The big attraction is more features and lower rates. For example, Vonage and Primus both offer unlimited Canadian and US long distance for a flat monthly fee. Snowbirds can take their Toronto phone service to Florida for the winter. Residential VOIP service is also attractive to households that need to exceed the one or two lines which run to their house.

An interesting development has been the trend to run VOIP over wireless networks such as WiFi. A WiFi-capable VOIP handset can therefore be used to roam within the office, the employee’s home (assuming they are using a WiFi network at home) or even public “hotspots”. Telus is planning to set up wireless access points throughout Scotia Plaza and to sell VOIP and wireless Internet services to the tenants of the building.

Another recent development has been the explosive growth of “free” VOIP networks such as Free World Dialup or FWD. FWD can be used to call other FWD users or to place calls to US or UK toll free numbers. Features such as call display, call answer, 3 way calling and others are also available at no charge. FWD can also be used to receive calls from the regular telephone system although callers must dial one of a number of US numbers and then enter the user’s FWD number.

Users can access FWD using special VOIP phones, free software programs (known as SIP softphones) which can emulate a phone on a PC or hardware devices (known as terminal adapters) which can be used to connect a regular analog phone or cordless phone to a local area network (including home DSL routers or cable modems). FWD is a great tool for homes with teenagers who would otherwise tie up the phone. The ultimate setup for a “road warrior” is a SIP softphone program running on a WiFi-capable PDA.

Note: The above appeared as a Bits & Bytes article published by Law Times in 2004.

Copyright Board Update

On December 12th, 2003, the Copyright Board (Canada) issued it latest decision regarding the tariff for private copying levies. Private copying of sound recordings containing musical works is addressed under Section 80 of the Copyright Act (Canada), which creates an exception to the exclusive reproduction right; it legalizes private copying onto audio recording media. Section 83 permits a copyright society to propose and collect tariffs which are imposed on those who manufacture or import blank audio recording media. These tariffs are used to pay musicians and songwriters for revenue lost due to personal copying.

The exemption in Section 80 applies only when a copy is made for the private use of the person making it. This expressly excludes selling, renting out, exposing for trade or rental, distributing, communicating to the public by telecommunication, or performing in public the copy made. This means that providing a copy to a friend is still an infringing action, as it is not a copy for personal use.

The Decision adds a new levy of between $2 and $25 (depending on the size of the device’s internal storage capability) for digital audio recorders (better known as MP3 players) including Apple’s hot selling IPod. However, the Copyright Board declined to apply a levy on blank DVDs, removable flash memory cards and removable hard drives because, according to the Copyright Board, “evidence available at this time does not clearly demonstrate that these recording media are ordinarily used by individuals for the purpose of copying music.” One result is that internal hard drives and solid state memory contained in MP3 players are subject to a royalty but any generic expansion memory which may be utilized with such devices is not.

The Copyright Board also turned down the Canadian Private Copyright Collective’s request to significantly raise levies on media currently subject to levies (cassettes, minidisks and blank CDs) and froze the existing fees until the end of 2004.

One interesting element of the evidence presented to the Copyright Board was a survey of the private copyright habits of Canadians. In 1999, when the Copyright Board issued its first decision on the subject, more than 90 percent of copies were made onto audio cassettes. However, there has now been a significant shift to recordable and rewritable CDs which now account for more than 75% while the share of audiocassettes has fallen to less than 20%. The overwhelming majority of private copies are now made using blank CDs.

The Decision also addressed various concerns regarding CPCC’s zero-rating program which is used to exempt certain persons or organizations from paying the private copying royalty. Such entities, which may include religious organizations, broadcasters, law enforcement agencies, courts, tribunals, court reports, provincial ministers of education, the Association of Universities and Colleges of Canada, music and advertising industries may apply for a certificate number allowing them to buy covered media levy-free from specified sellers.

One effect of the Decision is that it may legitimize certain aspects of peer-to-peer networks which are now heavily used to distribute music on the Internet. The Copyright Board stated that the private copying regime does not address the source of the copy (pre-owned recording, a borrowed CD or a track downloaded from the Internet) or whether the original has to be an authorized or noninfringing version. So according to the Copyright Board, users can legally make reproductions onto covered media for personal use of music downloaded from peer-to-peer networks such as Napster, Kazaa or Morpheus.

No tariffs were requested by the CPCC for computer hard drives and according to news reports quoting Claude Majeau, secretary general of the Copyright Board, “as far as computer hard drives are concerned, we say that for the time being, it is still legal.” Simply because the Copyright Board has not been asked to certify a tariff on hard disks in personal computers does not mean that private copies made onto such media infringe copyright. However, an audio recording medium to which no tariff applies because the Copyright Board has decided is not of a kind ordinarily used by individuals for recording music (such as DVDs) is removed from the ambit of the exemption.

It should be noted that not everyone shares in the view that downloading music is legal under Canadian law and ultimately it may be Canadian courts who will decide the issue. Also, the private copying regime only addresses the reproduction right. The Decision does not affect the current proceeding by Society of Composers, Authors and Music Publishers of Canada (SOCAN) before the Supreme Court of Canada regarding a royalty sought to be imposed against Internet Service Providers in respect of the “communication to the public by telecommunication” right which may be infringed by various intermediaries involved in the distribution of music on the Internet.

Note: The above appeared as a Bits & Bytes article published by Law Times on January 26, 2004.