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Facebook, Inc. V. Power Ventures, Inc. 1 Facebook, Inc Facebook, Inc. v. Power Ventures, Inc. 1 Facebook, Inc. v. Power Ventures, Inc. Facebook, Inc. v. Power Ventures, Inc. United States District Court for the Northern District of California Date decided May 11, 2009 Citations 91 U.S.P.Q.2d 1430 Judge sitting Jeremy D. Fogel Case holding Case Pending; Defendant's Motion to Dismiss Denied; Defendant's Motion for a more definite statement Granted in Part, Denied in Part. Keywords Copyright, DMCA, Lanham Act, Trademark, Unfair Competition Facebook, Inc. v. Power Ventures, Inc. is a lawsuit brought by Facebook in the United States District Court for the Northern District of California alleging that Power.com [1], a third-party platform, collected user information from Facebook and displayed it on their own website. Facebook claimed violations of the CAN-SPAM Act, the Computer Fraud and Abuse Act ("CFAA"), and the California Comprehensive Computer Data Access and Fraud Act.[2] According to Facebook, Power.com made copies of Facebook’s website during the process of extracting user information. Facebook argued that this process causes both direct and indirect copyright infringement. In addition, Facebook alleged this process constitutes a violation of the Digital Millennium Copyright Act ("DMCA"). Finally, Facebook also asserted claims of both state and federal trademark infringement, as well as a claim under California's Unfair Competition Law ("UCL"). Power.com filed a motion to dismiss the case (or in the alternative, a motion for a more definite statement), but Judge Fogel denied the motion. In a counter-claim, Power.com alleged that Facebook engaged in monopolistic and anti-competitive behavior by placing restraints on Power.com's ability to manipulate users' Facebook data even when their consent was given.[3] Background Power Ventures operates Power.com, a website that enables its users to aggregate data about themselves that is otherwise spread across various social networking sites and messaging services, including LinkedIn, twitter, Myspace, and AOL or Yahoo instant messaging. This aggregation method is embodied in its motto: "all your friends in just one place."[4] Power wanted to provide a single site for its customers to see all of their friends, to view their status updates or profile pages, and to send messages to multiple friends on multiple sites. Power intended and planned to enable users to access Facebook profile data on the Power site.[5] Facebook allows third parties to create applications that interact with Facebook’s services, as long as these applications follow a standardized set of protocols and procedures. Third-party developers must agree to Facebook’s Developer Terms of Service, the Terms of Use, and other applicable policies.[6] Also, "if third party websites use the Facebook Connect service, which enables users to 'connect' their Facebook identity, friends and privacy to those Facebook, Inc. v. Power Ventures, Inc. 2 third-party websites, they are allowed exchange of proprietary data with third party websites."[7] The litigation focuses on Power.com's alleged "scraping" of content for and from users on Facebook into Power.com's interface. Facebook sued claiming violations of copyright, DMCA, CAN-SPAM, and CFFA.[7] [8] Power.com and Facebook tried unsuccessfully to work out a deal that allowed Power to access Facebook’s site, through Facebook Connect. In late December 2008, Power.com informed Facebook that it would continue to operate without using Facebook Connect. Power.com allegedly continued to "scrape" Facebook’s website, despite technological security measures to block such access.[7] Power.com subsequently signed up for its own Facebook account, agreeing to Facebook’s terms of service, then asked its members who were Facebook users to provide their username and password for the limited purpose of gaining access to their profile information and "scraping" their profile data off Facebook. Power.com allegedly used this scraped information to solicit other Facebook users to join Power.com. While Facebook has copyright claims to the proprietary content and design of the website, it does not own a copyright in its users’ profile data.[5] Opinion of the Court Facebook Inc. sued Power Ventures Inc. in the Northern District of California. The court's ruling addressed a motion to dismiss the copyright, DMCA, trademark, and UCL claims. Legal Standard When a court considers a motion to dismiss, it must take the allegations in the Plaintiff's complaint as true and construe the Complaint in a manner that is favorable to the Plaintiff. Thus, for a motion to dismiss to succeed, the complaint must lack either a cognizable legal theory or sufficient facts to support the legal theory.[9] Copyright Infringement To state a claim for copyright infringement, a plaintiff need only allege 1. ownership of a valid copyright and 2. copying of original elements of the work.[7] The First Amended Complaint ("FAC") alleged that Power.com accessed Facebook's website and made unauthorized "cache" copies of it or created derivative works derived from the Facebook website. However, Power.com contended that Facebook’s copyright allegations are deficient because it is unclear which portions of Facebook's website are alleged to have been copied. Facebook argued that it need not define the exact contours of the protected material because copyright claims do not require particularized allegations. Since Facebook owns the copyright to any page within its system (including the material located on those pages besides user content, such as graphics, video and sound files), Power.com only has to access and copy one page to commit copyright infringement.[7] Facebook conceded that it did not have any proprietary rights in its users' information. Power.com users, who own the rights to the information sought, have expressly given Power.com permission to gather this information.[7] [8] Judge Fogel’s reasoned that MAI Systems Corp. v. Peak Computer, Inc. and Ticketmaster LLC v. RMG Techs. Inc. indicated that the scraping of a webpage inherently involves the copying of that webpage into a computer’s memory in order to extract the underlying information contained therein. Even though this "copying" is ephemeral and momentary, that it is enough to constitute a "copy" under § 106 of the Copyright Act and therefore infringement.[10] Since Facebook’s Terms of Service prohibit scraping (and thus, Facebook has not given any license to third parties or users to do so), the copying happens without permission.[8] Facebook, Inc. v. Power Ventures, Inc. 3 MAI Systems Corp. v. Peak Computer, Inc. In the MAI case, the Court granted summary judgment in favor of MAI on its claims of copyright infringement and issued a permanent injunction against Peak. The alleged copyright violations included: 1. Peak's running of MAI software licensed to Peak customers; 2. Peak's use of unlicensed software at its headquarters; and, 3. Peak's loaning of MAI computers and software to its customers.[11] Ticketmaster LLC v. RMG Techs. Inc. In this particular case, the Court held that Ticketmaster LLC ("Ticketmaster") was likely to prevail on claims of direct and contributory copyright infringement as a result of defendant RMG Technologies Inc. ("RMG") distribution of a software application that permitted its clients to circumvent Ticketmaster.com’s CAPTCHA access controls, and use Ticketmaster’s copyrighted website in a manner that violated the site’s Terms of Use. The Court held that RMG was likely to be found guilty of direct copyright infringement because when RMG viewed the site to create and test its product, it made unauthorized copies of Ticketmaster’s site in its computer’s RAM.[12] In the instant case, the Court followed Ticketmaster to determine that Power.com's 'scraping' made an actionable "cache" copy of a Facebook profile page each time it accessed a user's profile page.[7] Digital Millennium Copyright Act The elements necessary to state a claim under the DMCA are 1. ownership of a valid copyright; 2. circumvention of a technological measure designed to protect the copyrighted material; 3. unauthorized access by third parties; 4. infringement because of the circumvention; and 5. the circumvention was achieved through software that the defendant either 1. designed or produced primarily for circumvention; 2. made available despite only limited commercial significance other than circumvention; or 3. marketed for use in circumvention of the controlling technological measure.[7] Power.com argued that Facebook’s DMCA claim was insufficient using the same arguments listed above. They also argued that the unauthorized use requirement was not met because the users are controlling the access (via Power.com) to their own content on the Facebook website. However, the Terms of Use negate this argument because users are barred from using automated programs to access the Facebook website. While users may have the copyright rights in their own content, Facebook placed conditions on that access. After Power.com informed Facebook that Power.com intended to continue their service without using Facebook Connect, Facebook implemented specific technical measures to block Power.com's access. Power.com then attempted to circumvent those technological measures. As all of the elements of a DMCA claim had been correctly pleaded and supported in the FAC, the motion to dismiss the DMCA claim was denied.[7] Facebook, Inc. v. Power Ventures, Inc. 4 Trademark Infringement Federal The Lanham Act imposes liability upon any person who 1. uses an infringing mark in interstate commerce, 2. in connection with the sale or advertising of goods or services, and 3. such use is likely to cause confusion or mislead consumers.[7] [13] Facebook stated that they were the registered owner of the FACEBOOK mark since 2004. Furthermore, they alleged that Power.com used the mark in connection with Power.com's business. Facebook never authorized or consented to Power.com's use of the mark.
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