Monthly Archives: August 2009

Contest Submission Concerns

Intellectual Property: With the success of shows like American Idol and other reality-TV-based talent competitions, contests encouraging writers, singers, songwriters and filmmakers to submit their ideas and material in order to be “discovered” have become more prevalent. While certainly, these contests have proven to be beneficial to more than a few individuals, they are not without their obstacles.

Those interested in entering any such contest, or otherwise submitting material pursuant to a request, should be cautious as to what rights they are ceding with that submission. Quite often, the terms of the contest could grant the contest-host all of the intellectual property rights relating to the submission. In addition to preventing the original artist from continuing to utilize or promote his work, it could also mean that the company hosting the contest could pursue the project without the submitter’s consent or participation.

For example, assume that there is a film festival that is hosting a contest for unknown, independent filmmakers to win an opportunity to have their films featured at the festival. More often than not, when entering such a contest, the artist submits his materials with a signed application. This application may very well have terms and conditions that are associated with it, and to which he may unknowingly agree by just signing the application. Even when there is not a written application, there are often terms and conditions that are deemed to be “accepted” when the applicant submits his materials. These contractual terms (even though they may not “look like” a contract) could include an assignment of intellectual property to the contest host. For example, such terms often say that the submitter has no right to have the materials returned to him, and that he may grant the host company all right to the work to exploit it as it wishes. In such event, the submitter may be deemed to have abandoned his rights, and the work will no longer remain his own. Importantly, the assignment may be deemed to have been made simply by submitting the work, and the rights may be granted even if the submitter does not win the contest.

This is why it is critical to have an attorney review any and all documents before signing them. It is also important to maintain copies of any document signed. Why? Because at a later time the submitter may want to pursue the original work, and he may not know whether or not he gave up his rights. If he had kept a copy of the agreement, he could at least have an attorney review it at a future time to determine the status of his rights.

Comments/Questions: ljm@gdnlaw.com

© 2009 Nissenbaum Law Group, LLC

Consumer Reviews: A Form of Permitted Defamation?

Commentary: We regularly receive inquiries relating to postings on consumer review websites. The usual issue concerns the fact that the business owner feels that the customer’s posting is defamatory and should be removed. In such a case, there are a number of things that the “victim” business needs to keep in mind.

First, for most of these websites, the publication of customer reviews, whether positive or negative, is the nature of their business. If they were to remove negative reviews, their credibility would arguably be hurt and the website’s viability as a business model might be diminished. These sites generally need to allow the posting of negative reviews in order to survive. Accordingly, injured parties are likely to face resistance when requesting that a host website remove such content. In order to have a posting removed, additional legal action may need to be taken; more often than not, a mere demand letter will not do the trick. It is also important to keep in mind that the websites may not have incentive to cooperate with the complaining business under the law. The Communications Decency Act states that a website will generally not be liable for its posters’ speech.

The next question is what right does a business owner have to seek damages against a customer who has posted a negative review. All of the rights and remedies that may be available will vary based upon the specific information relayed in the posting and the unique context facing the victim and the speaker. This is yet another reason that it is important to seek legal counsel to evaluate a specific claim. However, for purposes of this discussion, our analysis will focus on the potential defamation claim.

It is critical that businesses understand that simply because information is negative, and even injurious, that statement may not be defamatory. The posting itself would not be a “permitted form of defamation” since if it is found to be defamatory, it would not be permitted. The question is really whether or not the statement is defamatory. Defamation law is almost always analyzed in accordance with First Amendment law. Just as a business or person has protections under the law from being defamed, so too does the speaker have a First Amendment right to speak about his experiences.

The balance therefore comes from an analysis of the speech itself. Again, the negative nature of the statement is not itself conclusive. Rather, for a defamation claim to exist, the speech must not only be damaging, but it also must be false. Thus, if the customer reports a bad encounter, but he is truthful in his recitation of the history, there is likely no claim for defamation. Similarly, opinions are protected. If a customer simply indicates that he does not like the business owner or did not like the business’s products or services, that is arguably an opinion and therefore, is not a statement that is capable of being false. It therefore cannot be defamatory. The customer has a First Amendment right to share his opinions and experiences.

Defamation law seeks to protect those who are injured by lies. If a posting is made by someone who has never been a customer of a business or by someone who falsifies facts about the business or its products and services, a viable claim for defamation may exist. Of course, the claim would rest upon the extent of the resulting money damages that could be proven.

There is a complex analysis of all statements and underlying facts to determine whether or not a claim for defamation can be made based upon a customer’s online review of a business’s products and services. It is therefore critical that all potential plaintiffs immediately consult with counsel to evaluate the statements and to review the applicable remedies that may be available.

Comments/Questions: ljm@gdnlaw.com

© 2009 Nissenbaum Law Group, LLC