Advanced Copyright Issues on the Internet - Fenwick & West LLP

3. The MetroGuide LitigationIn January 2003, MetroGuide.com sued Hotels.com in Florida for violations of copyrightand unfair competition laws for its practice of causing pop-up ads for Hotels.com to appear overMetroGuide’s web sites. The complaint alleges that the pop-up ads obscured theplaintiff439brand and content underneath them, enticing customers to book rooms directly withHotels.com. 23404. The D Squared LitigationIn Oct. 2003, the Federal Trade Commission instituted litigation against D SquaredSolutions in federal district court in Maryland. 2341 D Squared co-opted a network administrationfeature of Microsoft Windows known as “Messenger Service,” which was designed to enablecomputer network administrators to provide instant information to network users such as theneed to log off, to send a stream of repeated pop-up advertisements that appeared on the screensof computer users connected to the Internet at 10- to 30-minute intervals. The pop-up messagesinstructed consumers to visit one of the defendants’ web sites to purchase software that wouldcause the pop-up ads to stop. 2342 The FTC sued D Squared, alleging that its business methodsconstituted unfair competition, and secured a temporary restraining order against thedefendants. 2343On Dec. 16, 2003, the court, after a hearing on an order to show cause why the courtshould not enter a preliminary injunction, denied the FTC’s request for a preliminary injunction,vacated the temporary restraining order, and directed counsel to commence discoveryimmediately. A non-jury trial was calendared for Mar. 8-10, 2004. Because the court renderedits ruling on the record, no opinion was issued giving the court’s reasons. However, the courtapparently noted that it was unclear whether the pop-up ads had caused substantial injury toconsumers. 2344 As of the writing of this paper, the litigation was ongoing.5. International DecisionsIn March of 2004, a the Court of First Instance in Cologne, Germany, issued apreliminary injunction against Claria (formerly known as Gator) that prohibited the company’s2340 “MetroGuide.com Sues Hotels.com; Seeks Damages for <strong>Copyright</strong> Infringement and Predatory Advertising”(Jan. 27, 2003), available as of Jan. 28, 2003 at www.businesswire.com/cgibin/f_headline.cgi?bw.012703/230272653.2341 Complaint, Federal Trade Commission v. D Squared Solutions, LLC, 03 CV 31 08 (D. Md. Oct. 30, 2003),available as of Jan. 17, 2004 at www.ftc.gov/os/2003/11/0323223comp.pdf.2342 Id. 9-10.2343 The temporary restraining order was available as of Jan. 17, 2004 at www.ftc.gov/os/2003/11/0323223tro.pdf.2344 “FTC Denied Injunction Against Software Firm’s Intrusive Pop-Up Ads” (Dec. 15, 2003), available as of Jan.17, 2004 at http://24hour.startribune.com/24hour/technology/story/1089101p-7607955c.html.- 510 -