Social media sites are transforming not only the daily lives of consumers, but also how companies interact with consumers. Here at Morrison Foerster, across all of our practice groups, we are seeing complex, cutting-edge legal issues arising out of social media. As with the Internet boom during the mid-to-late 1990s, social media is generating new legal questions at a far faster pace than the law’s ability to provide answers to such questions. In an effort to stay on top of these emerging issues, and to keep our clients and friends informed of new developments, Morrison Foerster publishes this blog devoted to the law and business of social media.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.Aaron’s practice focuses on advising both established and emerging companies in a variety of data- and technology-intensive sectors, including software, SaaS, cloud-based technology, digital media (social media, AR/VR, gaming, streaming media, AdTech), AI, healthcare, consumer electronics, e-commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on branding and marketing, trademark licensing, and content-related transactions, as well as the intellectual property aspects of mergers, acquisitions, asset spin-offs, and private equity investments.He has represented clients such as Autodesk, Meta, OpenAI, Splunk, Konami, Kaiser Permanente, SoftBank, Visa, and Yahoo, among others.Aaron has been recognized by numerous publications for his work on market-defining technology transactions. He is currently ranked by Chambers USA for “Technology Transactions.”Aaron also serves as co-editor of Socially Aware, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics. Aaron is also a sought-after speaker on new and emerging areas of law, and is a frequent presenter and panelist at conferences and legal services programs. In addition to his active practice, Aaron regularly provides pro bono assistance to various nonprofit and charitable organizations such as Common Sense Media and the Starlight Children’s Foundation. He is a member of the board of directors of California Lawyers for the Arts.While in law school at the University of California, Berkeley, Boalt Hall School of Law, Aaron served as executive editor of the California Law Review and was elected to the Order of the Coif. Following law school, Aaron served as law clerk to the Honorable William H. Orrick and the Honorable Martin J. Jenkins, both United States District Judges for the Northern District of California.

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Partner

Aaron is the chair of our Technology Transactions Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals. Aaron’s practice focuses on advising both established and emerging companies in a variety of data– and technology–intensive sectors, including software, SaaS, cloud computing, AR/VR, AI, gaming, healthcare, consumer electronics, social media, e–commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on the intellectual property aspects of mergers, acquisitions, asset spin–offs, and private equity investments.

Aaron P. Rubin

Lawrence Gallick is of counsel in the firm’s Austin office and a member of the Technology Transactions Group.Lawrence focuses his practice on technology transactions and licensing matters. His diverse experience includes advising on SaaS agreements, cross-licensing agreements, research and collaboration agreements, development agreements, and distribution agreements. He counsels a broad range of companies across the software, hardware, life sciences, biotech and FinTech spaces, as well as other entities including universities.He advises clients in connection with general corporate matters including contract negotiations, and leasing and technology placement agreements.Lawrence also serves as co-editor of <a href="https://www.sociallyawareblog.com/" target="_blank">Socially Aware</a>, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics.Prior to joining the firm, Lawrence was counsel at another major law firm. Before earning his law degree, Lawrence was a web consultant, project manager, and web developer in Portland, Oregon, where he managed and consulted on projects using industry methodologies and performed custom development and integration of content management systems.Lawrence was named a Super Lawyers “Rising Star” in 2015 and 2018–2022, and is licensed in both California and New York. Lawrence earned his J.D. from the University at Buffalo School of Law, where he was the electronic systems editor for the Buffalo Law Review and awarded the ABA-BNA Award for Excellence in the Study of Intellectual Property Law.

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Of Counsel

Lawrence Gallick

Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster.Anthony advises clients on general commercial and transactional matters. He regularly advises companies on the IP aspects of their M&A transactions. His clients include technology, digital media and content for television and music, financial services, and communications companies with diverse intellectual property assets and issues.His practice focuses on the legal aspects of developing, licensing, and commercializing technology and intellectual property, as well as negotiating general commercial contracts, including outsourcing transactions, as well as content and data licenses. He regularly assists clients with legal issues relating to licensing and commercialization of digital media and content, digital content that is distributed over the Internet or streamed, mobile applications and social media, as well as the licensing of recorded music for distribution via digital platforms. Anthony is also experienced with issues relating to open-source software, software development, artificial intelligence and machine learning, cloud-based technology, and protection of proprietary information.Anthony has extensive experience working on matters involving disruptive technologies, such as blockchain. He has helped fintech clients with general intellectual property issues in connection with terms of service for online financial products and services.Anthony is an integral part of the outside pro bono legal team for nonprofit organizations based in New York, including advising clients on legal issues regarding entertainment, social media, privacy rights, and the negotiation of outsourcing and service agreements. Anthony received his J.D. from the University of Michigan Law School in 2009. He received his B.S. from Cornell University in 2004.

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Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster. He advises clients on general commercial and transactional matters. His clients include technology, media, and communications companies with considerable intellectual property assets. His practice focuses on the legal aspects of licensing and commercializing technology and intellectual property, as well as negotiating general commercial contracts. He also regularly assists clients with legal issues relating to mobile applications and social media.

Anthony M. Ramirez

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Socially Aware is devoted to the law and business of social media, proactively addressing emerging issues and keeping our clients informed of new developments. We cover fields such as artificial intelligence, privacy and data security, Section 230, intellectual property, and much more.

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Lawrence W. Gallick

Social Links: If the Suit Fits

Social Links: Age Verification, X Appeal, and the Great White North

Social Links: Fake Reviews, Real Rulings, and an Epic Fail

Lawrence W. Gallick on Toth v. Everly Well, Inc.

Social Links: Going Back to Cali

We’re happy to publish our latest infographic, which highlights key social media marketing trends for both B2B and B2C companies. Among other things, the infographic points out that, although companies continue to increase their social media marketing spend, they don’t do a particularly good job at engaging consumers through social media, and they still struggle to determine the return on their investment. Enjoy! And please feel free to share this infographic with your marketing colleagues.

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Infographic: Social Media Marketing

We’re happy to publish our latest infographic, which highlights key social media marketing trends for both B2B and B2C companies. Among other things, the infogr

Infographic: Social Media Marketing

Online sales on the Monday after Thanksgiving weekend—Cyber Monday—have <a href="http://www.statista.com/statistics/194643/us-e-commerce-spending-on-cyber-monday-since-2005/" target="_blank" rel="noopener">continued to increase</a> year over year since the <a href="http://www.tomsguide.com/us/what-is-cyber-monday,review-1953.html" target="_blank" rel="noopener">day was first christened “Cyber Monday” in 2004</a>. As social media enthusiasts, we were surprised to learn that social networks drove only 1.5% of the avalanche of online orders placed on Cyber Monday in 2014.Social media platforms, however, are poised to become much more important players in Cyber Monday 2015.Indeed, many industry experts are considering this holiday season “<a href="http://www.cnbc.com/2015/11/24/can-facebook-twitter-win-on-cyber-monday.html" target="_blank" rel="noopener">a testing ground for social commerce</a>,” as Facebook, Twitter, Pinterest and Instagram are at various stages of implementing the “buy button”—a feature that allows social media users to purchase products they see in the brand posts that appear in their feeds without even leaving the platform.Because Facebook’s buy button program is still in its early stages, only a small group of retailers are involved, and Facebook users might not even see a buy button on Monday. Pinterest’s buy button program is <a href="https://www.sociallyawareblog.com/2015/07/09/status-updates-driving-while-social-a-small-countrys-facebook-ban-and-pinterests-new-purchasing-feature/" target="_blank" rel="noopener">much further along</a>, however, and now features <a href="http://www.cnbc.com/2015/11/24/can-facebook-twitter-win-on-cyber-monday.html" target="_blank" rel="noopener">more than 10,000 businesses</a>, some of which are reaping great benefits as a result of their partnership with the online pinboard.How Monday’s buy button results will affect marketers’ social media efforts in the future remains to be seen. In the meantime, here’s a rundown of consumer behavior on Cyber Monday last year:<ul><li>U.S. online sales amounted to more than <a href="http://www.usatoday.com/story/money/business/2014/12/01/cyber-week-deals-begin/19733541/" target="_blank" rel="noopener">$2 billion</a>, up from $1.74 billion in 2013</li><li>23.9% of sales originated through email marketing</li><li>Online search results that were paid for by retailers generated 18.8% of sales</li><li>Online search results that were paid for by retailers generated 16% of sales</li><li>Average value of online purchases originating from Facebook: $123</li><li>Average value of online purchases originating from Pinterest: $97</li><li>There were <a href="http://www.forbes.com/sites/ianmorris/2014/12/01/apple-samsung-ea-and-microsoft-were-black-friday-and-cyber-monday-winners" target="_blank" rel="noopener">339,959</a> discussions about Cyber Monday on social media, a 75% increase over 2013</li><li>The brands mentioned most often were <a href="http://www.forbes.com/sites/ianmorris/2014/12/01/apple-samsung-ea-and-microsoft-were-black-friday-and-cyber-monday-winners/" target="_blank" rel="noopener">Amazon, Etsy, Motorola and EA</a></li></ul>Of course, as we noted in an <a href="https://www.sociallyawareblog.com/2015/11/24/black-friday-its-not-just-about-brick-mortar-stores-anymore/" target="_blank" rel="noopener">earlier post</a>, in recent years consumers have started their online shopping earlier in the holiday weekend. As more Americans have access to high-speed Internet connections at home, they no longer need to wait until arriving at work on the Monday after Thanksgiving to do their online binge purchasing. In fact, online sales on Black Friday—the day after Thanksgiving famous for long lines at brick & mortar retail stores—increased 26% in 2014 over 2013.So, even if social media is successful in goosing Cyber Monday sales this year, will Cyber Monday itself increasingly be viewed as a relic of an earlier age, having been pushed up to merge with Black Friday?

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Cyber Monday, Social Commerce and the End of an Era

Cyber Monday, Social Commerce and the End of an Era

Online sales on the Monday after Thanksgiving weekend—Cyber Monday—have continued to increase year over year since the day was first christened “Cyber Monday” i

Employers took note last year when the National Labor Relations Board (NLRB) <a href="https://www.nlrb.gov/case/34-CA-012915" target="_blank" rel="noopener">ruled</a> that “liking” a Facebook post can qualify as protected activity under the National Labor Relations Act (NLRA). The NLRB held that the owner of a sports bar violated Section 7 of the NLRA by firing employees for a protected Facebook discussion criticizing the owner’s tax-withholding practices. An employee who referred to the owner as an “asshole” and another employee who merely “liked” the Facebook discussion were both engaged in protected activity, according to the NLRB.Now the Second Circuit has affirmed the NLRB’s ruling. The Court rejected the argument that the employees’ Facebook discussion was unprotected because it amounted to uttering obscenities in the presence of customers. Accepting such an argument, wrote the Court, “could lead to the undesirable result of chilling virtually all employee speech online.”The Court noted that almost all Facebook posts have the potential to be viewed by customers, but in this case the discussion was protected because it was not directed at customers and did not reflect the employer’s brand.In addition, the employees’ Facebook activity did not lose protection simply because it contained obscenities viewed by customers, as such protection “accords with reality of modern-day social media use.”The Second Circuit’s decision signals significant protection of employees’ social media communications, including a Facebook “like.” However, the Court refused to publish its summary order, despite <a href="https://www.nlrb.gov/case/34-CA-012915" target="_blank" rel="noopener">urging</a> from the NLRB, so the decision has no precedential effect.Nonetheless, the takeaway is clear: “Like” it or not, employers should proceed with caution when considering whether to take action against employees for social media postings, even where obscenities are involved. Such is the reality of modern-day online speech.

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Mary Race assists clients with a wide range of challenging privacy compliance and data security matters. Her practice focuses on managing privacy risks and helping clients develop and implement comprehensive privacy programs across a variety of industries, including tech, retail, manufacturing, advertising, social media, and communications.

Mary Race

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The Second Circuit Tackles Employee Rights, Obscenities & Social Media Use

The Second Circuit Tackles Employee Rights, Obscenities & Social Media Use

Employers took note last year when the National Labor Relations Board (NLRB) ruled that “liking” a Facebook post can qualify as protected activity under the Nat

Here at Socially Aware, we’re focused on Thanksgiving dinner, but we’re well aware that the day after Thanksgiving—Black Friday—is one of the busiest shopping days of the year, and a critical sales day for brick-and-mortar retailers. So we were intrigued to stumble upon some statistics indicating that, although U.S. consumers are still interested in scoring retail bargains on Black Friday, they increasingly prefer to do it from the comfort of their living room sofas. Here, a rundown of consumer behavior on Black Friday last year:<ul><li>At U.S. brick-and-mortar stores, consumers spent just over $9 billion. That was a <a href="https://www.sociallyawareblog.com/wp-admin/52%20percent%20of%20all%20US%20internet%20traffic">7% decline</a> from 2013</li><li>Online sales amounted to $1.5 billion, <a href="http://techcrunch.com/2014/12/01/u-s-thanksgiving-black-friday-sales-break-1b-total-holiday-spend-online-will-be-89b">up 26%</a> over 2013</li><li>Due to heavy traffic, the e-commerce sites of Best Buy Co. Inc. and outdoor gear retailer Cabela’s Inc. <a href="https://www.internetretailer.com/2014/11/28/black-friday-entices-online-shoppers">both went down</a> for a while that day</li><li>Referrals from Facebook resulted in orders averaging <a href="https://www.internetretailer.com/2014/11/28/black-friday-entices-online-shoppers">$109.94</a></li><li>Referrals from Pinterest resulted in orders averaging <a href="https://www.internetretailer.com/2014/11/28/black-friday-entices-online-shoppers">$100.23</a></li></ul>In our next post, we’ll take a look at Black Friday’s hipper younger brother, <a href="http://www.ibtimes.com/where-did-black-friday-cyber-monday-come-349365" target="_blank" rel="noopener">Cyber Monday</a>.

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Black Friday: It’s Not Just About Brick & Mortar Stores Anymore

Black Friday: It’s Not Just About Brick & Mortar Stores Anymore

Here at Socially Aware, we’re focused on Thanksgiving dinner, but we’re well aware that the day after Thanksgiving—Black Friday—is one of the busiest shopping d

[Editor’s Note: At Socially Aware, we occasionally invite guest columnists to contribute pieces on cutting-edge Internet-related legal issues; today we have the pleasure of publishing a piece by noted copyright scholar <a href="http://www.law.columbia.edu/fac/Jane_Ginsburg" target="_blank" rel="noopener">Jane Ginsburg</a>, Morton L. Janklow Professor of Literary and Artistic Property Law at Columbia Law School*.]A for-profit corporation scans millions of in-copyright books and permanently stores their full contents in its database, all without seeking permission or paying the books’ authors or publishers. Over  ten years ago, when Google began its massive digitization and storage program, with the cooperation of the University of Michigan library, who supplied the books that Google scanned, not many copyright scholars would have thought that the systematic copying of immense volumes of full text for commercial purposes, without the creation of new copyrightable expression building on the copied content, could plausibly assert the mantle of fair use. By the time the Second Circuit upheld Google’s fair use defense last month, that result seemed inevitable.How did the fair use doctrine go from a safety valve to enable second authors to create new works that productively incorporate reasonable portions of prior works, to a free (in both senses of the word) pass for mass commercial digitization – at least so long as the outputs from the commercial database communicate no expression or insufficient expression to infringe? And, perhaps, so long as the compiler of that database can keep the contents safe from hacking.In this column, I will set the decision in light of its forebears, and then consider its impact on future fair use defenses.First, a summary, in the court’s words, of the Google Books holding: (1) Google’s unauthorized digitizing of copyright-protected works, creation of a search functionality, and display of snippets from those works are non-infringing fair uses. The purpose of the copying is highly transformative, the public display of text is limited, and the revelations do not provide a significant market substitute for the protected aspects of the originals. Google’s commercial nature and profit motivation do not justify denial of fair use. (2) Google’s provision of digitized copies to the libraries that supplied the books, on the understanding that the libraries will use the copies in a manner consistent with the copyright law, also does not constitute infringement. Nor, on this record, is Google a contributory infringer.This column will address only the first holding. The key determination focused on the “highly transformative” purpose of the copying. In modern fair use jurisprudence, particularly in the Second Circuit, once a court rules the “nature and purpose of the use” (statutory fair use factor (1)) to be “transformative,” a successful outcome for the defense is almost assured. In the last 20 years of fair use case law, the meaning of “transformative” has itself become transformed.In an influential article written in 1990, Judge Pierre Leval of the U.S. Court of Appeals for the Second Circuit – who also authored the Google Books opinion  – coined “transformative use” to describe what used to be called “productive uses,” through which the fair use doctrine traditionally allowed follow-on authors to bestow their intellectual labor in reworking selections from a prior work, provided the borrowings did not prejudice the profits or prospects of that work.The Supreme Court, four years later, for the first time recognizing parody as a potential fair use, adopted the label. In <a href="https://supreme.justia.com/cases/federal/us/510/569/case.html" target="_blank" rel="noopener">Campbell v. Acuff-Rose Music, Inc.</a>, the Supreme Court inquired whether the defendants’ musical parody had made a “transformative” use: not one that merely supersedes the objects of the earlier work by copying it, but one that “adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message.” In the context of the Supreme Court’s Campbell decision, the Two Live Crew rap parody “transformed” Roy Orbison’s “Pretty Woman” by creating a new (and rather raunchy) work. But courts came to interpret Campbell’s reference to “something new, with a further purpose” to encompass copying that does not add “new expression,” so long as the copying gives the prior work “new meaning.” (See, for example, <a href="http://law.justia.com/cases/federal/appellate-courts/F3/336/811/468703/" target="_blank" rel="noopener">Kelly v. Arriba Soft Corp</a>.) Fair use cases began to drift from “transformative work” to “transformative purpose,” in the latter instance, copying of an entire work, without creating a new work, could be excused, particularly if the court perceived a sufficient public benefit in the appropriation.In the initial shift from “transformative work” to “transformative purpose” the defendant had in fact created an independent work of authorship, even though that work did not significantly alter the copied work. Thus, in <a href="https://www.law.berkeley.edu/files/Bill_Graham_case.pdf" target="_blank" rel="noopener">Bill Graham Archives v. Dorling Kindersley Ltd.</a> (which did not concern digital technologies), the Second Circuit held a coffee-table-book biography’s reduced-sized complete images of posters of the legendary rock band The Grateful Dead were “transformative” because the book used the images of the posters as “historical artifacts” to document the Dead’s concerts, rather than for the posters’ original aesthetic purpose. But the documentary/aesthetic distinction also significantly expanded the application of the fair use exception to new technological uses that did not yield new works. The search engine practice of permanent storage of works for the purpose of “indexing” has been the principal digital beneficiary of the “documentary” or “new purpose” brand of transformativeness (see, as examples, <a href="http://cyber.law.harvard.edu/people/tfisher/IP/2007%20Perfect%2010%20Abridged.pdf" target="_blank" rel="noopener">Perfect 10, Inc. v. Amazon.com, Inc.</a> and <a href="http://law.justia.com/cases/federal/appellate-courts/F3/336/811/468703/">Kelly v. Arriba Soft Corp.</a>).Other applications of the aesthetic/documentary distinction – more broadly characterized as a distinction between expression and information – to the inputting of copyrighted works into databases then emerged. In <a href="https://casetext.com/case/av-ex-rel-vanderhye-v-iparadigms-llc" target="_blank" rel="noopener">A.V. ex rel. Vanderhye v. iParadigms, LLC</a>, the Fourth Circuit ruled the constitution of a commercial database of student papers by the “Turn It In” plagiarism detection services a fair use: “the archiving of plaintiffs’ papers was transformative and favored a finding of ‘fair use.’ iParadigms’ use of these works was completely unrelated to expressive content and was instead aimed at detecting and discouraging plagiarism.” In a decision that in many ways presaged Google Books, the Second Circuit in <a href="http://www.leagle.com/decision/In%20FCO%2020140610086/AUTHORS%20GUILD,%20INC.%20v.%20HATHITRUST" target="_blank" rel="noopener">Authors Guild v. HathiTrust</a>, concerning library uses of their holdings, as digitized by Google, found the scanning and permanent storage of full copies of in-copyright books to further the ‘transformative use’ of allowing “data mining” of the contents of the books. Such uses are nonexpressive in two senses: they produce no new expression by the copying and storage entities, and the ‘mining’ of the scanned book seeks not to expose its expression, but rather to extract information.In light of this progression, the decision in Google Books probably surprised no one, even though Google Books presented two ultimately nonsalient differences with HathiTrust. While the University of Michigan is a nonprofit educational institution, and (apart from a limited program for the visually impaired) it confined its use of the database to datamining so that it conveyed none of the scanned works’ contents to the public, Google is not a charitable entity, and its book search program communicated to the public “snippets” of the books. “A snippet is a horizontal segment comprising ordinarily an eighth of a page”; on a 24-line page, a snippet works out to three lines. The court accorded scant weight to the commercial nature of Google’s enterprise, stressing that the Second Circuit has “repeatedly rejected the contention that commercial motivation should outweigh a convincing transformative purpose and absence of significant substitutive competition with the original.” Distinguishing between outputs that convey information about the scanned book from outputs that convey its expression, the court ruled that neither the datamining uses nor the snippet views exploited the copied works for their expressive value.  Hence “the creation of complete digital copies of copyrighted works [results in] transformative fair uses when the copies ‘served a different function from the original.’”With respect to the datamining uses there is a powerful argument that exploiting a work for its non-expressive information (bibliographic or bean-counting – how many times and in what works a given word or phrase appears) is not even prima-facie infringing, and that the digitization of lawfully– possessed copies (loaned from the University of Michigan library) to create a database that enables nonexpressive, but progress-of-knowledge-enhancing outputs must therefore be equally free. By contrast, the snippet views did convey limited amounts of expression, but the court repeatedly emphasized the very constrained and controlled, “fragmentary and scattered,” “cumbersome, disjointed, and incomplete nature of the aggregation of snippets made available through snippet view.” As a result, “at least as presently structured by Google, the snippet view does not reveal matter that offers the marketplace a significantly competing substitute for the copyrighted work” (emphasis supplied). The court appears to be endeavoring to avoid slippery-slope expansion of the content or presentation of fair use-permissible snippets.As currently constituted, the snippet views may well provide too little copyrightable expression to substitute for purchase of the full book, or for licenses of smaller, expression-bearing, increments of the book. But, as Appendix A to the court’s decision (reproducing a snippet view of one book) demonstrates, it is not clear that the snippets in fact offer sufficient “information about” the books to perform their “transformative” fair use function of allowing the user to ascertain whether the book is relevant to her purposes. More expression might better promote that objective, but might also risk displacing the potential licensing market for expressive excerpts. The decision upholds a status quo that may in fact satisfy neither authors nor users; the slippery slope thus may yet loom.Similarly, in response to the authors’ concern that the database might be vulnerable to hacking, the court responded that “Google has documented that Google Books’ digital scans are stored on computers walled off from public Internet access and protected by the same impressive security measures used by Google to guard its own confidential information.” Less “impressive security” might doom a fair use defense, given the devastating consequences of unfettered access to reproduce and further communicate the full text of digitized works. Thus, while the court found that Google’s program did not present a sufficiently credible risk of harm, it is not clear who else’s programs could clear the decision’s high security bar.The court’s cautious circumscription thus suggests that the Google Books decision does not herald a new extension of an already-expanded fair use defense, but (at least until a competitor with equivalent resources appears) is instead sui generis. The Second Circuit’s abstention from addressing some of the district court’s fair use analyses similarly betokens the decision’s modest scope.  For example, the <a href="http://scholar.google.com/scholar_case?case=6510192672912362556&hl=en&as_sdt=6&as_vis=1&oi=scholarr" target="_blank" rel="noopener">district court embraced</a> the long-spurned argument that defendant’s copying does the plaintiff a favor by bringing the work to greater public attention (“a reasonable factfinder could only find that Google Books enhances the sales of books to the benefit of copyright holders”), but the Second Circuit’s opinion forgoes such contentious flourishes.That said, in cases involving complete copying of entire works, questions undoubtedly remain regarding the reach of the recasting of “transformative use” as a dichotomy between the provision of “information about” a copied work (likely fair use) and the communication of “expressive content” (less likely fair use, though defendant may still show that its use does not substitute for an actual or potential market for the plaintiff’s expression).  Indeed, if fair use turns on nondisclosure to the public of a digitized work’s copyrightable expression, then, if Google had scanned and stored millions of books, and used the content for internal purposes without permission but also without disclosing any outputs of any kind to the public, would its use still be “fair”?[ *Author’s Note: Many thanks to June M. Besek, Executive Director of the Kernochan Center for Law, Media & the Arts, Columbia Law School.]

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Google Books and Fair Use: From Implausible to Inevitable?

Google Books and Fair Use: From Implausible to Inevitable?

[Editor’s Note: At Socially Aware, we occasionally invite guest columnists to contribute pieces on cutting-edge Internet-related legal issues; today we have the

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Following the Wisdom of the Crowd? A Look at the SEC’s Final Crowdfunding Rules

Following the Wisdom of the Crowd? A Look at the SEC’s Final Crowdfunding Rules

This article provides a detailed overview of the final rules, Regulation Crowdfunding, which will be applicable to crowdfunding offerings conducted in reliance 

Since its launch in 2011, the social media platform <a href="https://www.snapchat.com/" target="_blank" rel="noopener">Snapchat</a> has generated its share of negative press, with most of that press in some way related to the very characteristic that, at least initially, helped Snapchat to become popular among its mostly youthful user base: its “disappearing” messages feature.Yet, despite reports that the<a href="http://bits.blogs.nytimes.com/2012/05/06/disruptions-indiscreet-photos-glimpsed-then-gone/" target="_blank" rel="noopener"> app began as</a> (and <a href="http://www.dailydot.com/technology/snapchat-sexting-reddit-porn/" target="_blank" rel="noopener">continues to be</a>) a popular sexting tool, that Snapchat’s less-than-ironclad security measures resulted in<a href="http://www.cnet.com/news/overexposed-snapchat-user-info-from-4-6m-accounts/" target="_blank" rel="noopener"> the posting of millions of the app’s users’</a> personal information, and that <a href="https://www.sociallyawareblog.com/2014/05/13/snap-judgment-ftc-alleges-snapchat-did-not-keep-its-privacy-and-security-promises-but-suggests-broad-new-duty-in-the-process/" target="_blank" rel="noopener">Snapchat inaccurately represented its privacy and security policies</a>, Snapchat was the fastest growing app in 2014 and is the third-most-popular social app among millennials.So what accounts for Snapchat’s $19 billion valuation? According to senior Fortune editor <a href="http://fortune.com/2015/02/19/snapchat-worth-19-billion-more/" target="_blank" rel="noopener">Andrew Nusca</a>, the social media company has employed a “well worn” business model: “marshal a captivated audience, sell advertisements against it, profit.”Since that sounds a lot easier said than done—especially in light of Snapchat’s public missteps—we attempted to discern exactly how the company has managed to achieve those milestones. What has it done right?There is, of course, no exact formula for success; surely the rearing of all unicorns involves some measure of magic pixie dust. But a close examination of Snapchat reveals certain strategies that tech entrepreneurs seeking to duplicate Snapchat’s success might wish to emulate.<h4>1. Identify and pioneer a highly desirable feature.</h4>Because they encourage spontaneity and reassure social network users that they’re not sacrificing long-term privacy, disappearing messaging apps have been <a href="http://www.saydaily.com/2014/09/disappearing-updates" target="_blank" rel="noopener">popping up everywhere over the last couple of years</a>. But Snapchat was one of the very first social media companies to recognize the appeal of ephemeral posts—the app was premised on the claim that photos and texts sent using Snapchat disappeared after 10 seconds—and <a href="http://www.amazon.com/Youre-Not-First-Last-Competition/dp/0470624353" target="_blank" rel="noopener">being first never hurts</a>, especially when it comes to attracting an audience.In the last couple of years, however, doubts have arisen regarding Snapchat’s “disappearing messages” claims. Most notably, a 2014 Federal Trade Commission investigation concluded that, because several work-arounds exist, <a href="http://www.techtimes.com/articles/6853/20140512/snapchat-image-sharing-images-photos-videos-fcc-privacy-online-privacy.htm" target="_blank" rel="noopener">the company’s statements about its messages being ephemeral are essentially false</a>.Surprisingly, use of the Snapchat app <a href="http://www.globalwebindex.net/blog/snapchat-was-the-fastest-growing-social-app-of-2014" target="_blank" rel="noopener">continued to increase</a> even as the scandal broke, perhaps because, by then, Snapchat had already become popular with teenagers, or because the company had already implemented even more “<a href="http://time.com/4049026/snapchat-live-stories/" target="_blank" rel="noopener">addictive</a>” features (see numbers 2 and 3, below).Nevertheless, Snapchat has since toned down its <a href="https://itunes.apple.com/us/app/snapchat/id447188370?mt=8" target="_blank" rel="noopener">description of the app in the iTunes store</a>—the description now clarifies that Snaps disappear “unless [the recipients of the Snaps] take a screenshot”—and the company is also taking steps to beef up security and convince users that it’s worthy of their trust.<h4>2. Improve on a feature that has already proven popular with social media users.</h4>Snapchat’s reputation as the first “disappearing message” app may have been responsible for marshalling its young audience, but<a href="http://www.theverge.com/2014/6/20/5827666/snapchat-stories-bigger-than-snaps-electric-daisy-carnival" target="_blank" rel="noopener"> the social media company’s innovative online video features are likely the reason that audience has stuck around</a>.As a medium that allows people to easily “<a href="http://www.theguardian.com/small-business-network/2014/jan/14/video-content-marketing-media-online" target="_blank" rel="noopener">satisfy their information and entertainment needs</a>,” online video is one of social media users’ favorite features, industry experts agree. But the video functionality of many social media platforms has left a lot to be desired, according to some social media enthusiasts. Until now.In his own <a href="http://www.pocket-lint.com/news/131313-what-s-the-point-of-snapchat-and-how-does-it-work" target="_blank" rel="noopener">video</a> explaining Snapchat’s popularity, YouTube personality <a href="https://www.youtube.com/user/caseyneistat" target="_blank" rel="noopener">Casey Neistat</a> explains what online video fans have always wanted most from social media platforms: “It’s never been about just sharing a moving image,” Neistat explains. “It’s about giving people an easy way to tell a story.”With the introduction of Snapchat Stories, a feature that allows users to stitch several photos and quick videos together throughout their day to create a narrative, Snapchat “became the first company to figure out video on mobile,” according to Neistat.Snapchat Stories also have an authentic, unedited quality that the platform’s young users really appreciate. “You can’t, like, lie,” one of the Snapchat fans in Neistat’s video explains, “It’s in the moment.”“Snapchat is about now, not about photos with pretty filters or perfectly edited videos,” Neistat said. “It’s about sharing stories of your life with people who are interested.”<h4>3. Create compelling content by leveraging human resources.</h4>Recognizing that even the most sophisticated algorithms have limitations, many tech companies are starting to rely on human curators for their content, <a href="http://time.com/3973459/tech-human-curation/" target="_blank" rel="noopener">writes</a> Time tech reporter Victor Lukerson, and Snapchat is no exception. Snapchat Live Stories, a feature Lukerson <a href="http://time.com/4049026/snapchat-live-stories/" target="_blank" rel="noopener">describes</a> as the app’s “most addictive feature,” uses teams of actual people to choose from among as many as 20,000 user content submissions for each story. The curators create montages with narrative arcs by stitching together the best of the users’ photos and short video submissions.Based on the numbers—Live Stories reportedly attract 20 million viewers in a 24-hour window—Snapchat’s use of human curators is clearly paying off.<h4> 4. Give brands a unique and attractive way to advertise.</h4>With privacy concerns at an all-time high, social media users may become less inclined to patronize sites that use personal data to serve targeted ads, predicts Forbes contributor Jayson DeMers.That works for Snapchat. In contrast to most of the top social media platforms, Snapchat “has very little information about its users,” Time’s Lukerson <a href="http://time.com/4049026/snapchat-live-stories/" target="_blank" rel="noopener">reports</a>. And Evan Spiegel, Snapchat’s CEO, has <a href="http://www.adweek.com/news-gallery/technology/heres-buyers-guide-ad-targeting-8-social-platforms-167754" target="_blank" rel="noopener">said</a> that he doesn’t want to populate his platform with “creepy” hyper-targeted ads.Snapchat’s abstention from user-info aggregation may or may not prove important to its youthful user base; the <a href="http://www.adweek.com/news-gallery/technology/heres-buyers-guide-ad-targeting-8-social-platforms-167754" target="_blank" rel="noopener">nearly 100 million daily users</a> who continue to log in despite reports about the holes in the platform’s “disappearing messages” claim apparently don’t place as much of a premium on privacy as everyone originally thought.The important part is that Snapchat has hit on another—potentially more lucrative—way to monetize its business. According to Lukerson, the company “is pitching advertisers the same way TV executives do: by touting the massive audience that can view a single piece of media at the same time.”<a href="http://adage.com/article/digital/snapchat-tweaking-story-ad-sales-strategy/298082/" target="_blank" rel="noopener">Advertisers love content that’s live</a>, and Snapchat’s Live Stories are exactly that. Snapchat’s presentation of its live content in a linear feed makes it <a href="http://adage.com/article/digital/snapchat-tweaking-story-ad-sales-strategy/298082/" target="_blank" rel="noopener">very much like live event feeds on television</a>, a medium that Snapchat’s coveted demographic is slowly but surely <a href="http://www.marketingcharts.com/television/are-young-people-watching-less-tv-24817/" target="_blank" rel="noopener">abandoning</a>.Advertising on the platform is still risky. After just three seconds, <a href="http://www.fastcompany.com/3052407/behind-the-brand/how-coca-cola-cracked-snapchat?partner=venturebeat" target="_blank" rel="noopener">60% to 70% of Snapchat’s users stopped watching ads</a> on the app. For that reason, some industry observers <a href="http://www.fastcompany.com/3052407/behind-the-brand/how-coca-cola-cracked-snapchat?partner=venturebeat" target="_blank" rel="noopener">assert</a> that Snapchat advertising is still probably best left to big brands with big advertising budgets.And a big budget they’ll need. Snapchat has been tight-lipped about exactly what it’s charging, but, according to sources familiar with the business, the platform is selling $400,000 worth of ad space for a story generating 20 million views.

Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.

Aaron Rubin

Building a Successful Social Media App: Four Lessons Learned From Snapchat