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Bragg CaptionI’m going to track this case somewhat more closely going forward as the discovery process is about to get underway.

Taking a close look at court filings is a new feature for VB, and regular readers will notice that these posts contain only a tiny bit of opinion and not much personality at all. That’s because I am an attorney, and I need to be able to take positions in the future that are in my clients’ best interests on both sides of disputes like those that are likely to come up here. If I plastered this blog with my personal opinions about discovery disputes, motion practice, and judges’ likely reaction to various tactics, I would probably end up seeing those words in a filing against my future clients at some point, and that’s not fair to them (or very good for business).

I will call readers’ attention to things that most litigators would notice as anomalous (one of those is going to come up today, actually) and I will highlight excerpts from the filings that will be interesting to readers, but I’m not going to make broad predictions or generally critique the filings.

Enough lawyer words. Let’s get to it.

Yesterday, Defendants filed a Report pursuant to Federal Rule of Civil Procedure 26(f), and Bragg filed a motion to strike and/or amend this Report.

The relevant rule here is FRCP 26(f). It requires that the parties nail down what are basically “ground rules” for the discovery process before it gets started (for non-litigators, “discovery” is the required exchange of relevant information — in this case, it will largely consist of information kept by the parties about Bragg’s transactions, and about Linden Lab’s decision to terminate his account). Some of these “ground rules” include electronic discovery procedures, the treatment of confidential information, whether special procedures will be needed for certain kinds of discovery, and what general topics the parties will want discovery into. Typically, parties meet and confer and produce a single document that contains both parties’ positions, outlining areas of agreement where possible, and areas of dispute where agreement cannot be reached.

It appears that process broke down in this case, and as a result, Linden Lab submitted a Report that was not signed by Bragg (actually, his attorney would have been the person who signed it, but I’ll use plaintiff’s and defendants’ names for clarity) entitled “JOINT REPORT OF THE PARTIES PURSUANT TO FEDERAL RULE OF CIVIL PROCEDURE 26(F) – SIGNED BY DEFENDANTS ONLY.” This is atypical. Usually, even if the parties disagree about the content of a Rule 26(f) Report, they still produce a single Report that they both sign identifying the disagreements.

Bragg claims that Linden Lab refused to include several statements he wanted included in the Report, and has moved to strike and/or amend the Report. Linden Lab will presumably respond to this accusation when it files its Response to Bragg’s Motion.

Below are a excerpts from the documents that readers may find interesting.


Defendants represented that to the extent they exist, records of Plaintiff’s online chats with other Second Life users regarding the alleged auction scheme would be produced in hard copy form.

The parties could not agree to the number of depositions sought in this matter. Plaintiff currently believes based upon the Rule 26(a)(1) disclosures that he may seek more than ten (10)depositions. Defendants stated that they would object should Plaintiff seek to take more than ten (10) depositions absent a showing of good cause.

Defendants proposed that the parties enter into a stipulation and order governing confidentiality to protect the privacy of personal information of individuals (including third-party Second Life users) and confidential business, financial, or trade secret information that may be subject to disclosure or discovery. Plaintiff indicated his willingness to consider a confidentiality agreement to cover specific trade secrets and believes that any such information should be considered on a case-by-case basis.

It is Plaintiff’s position that the Answer of Defendants admits that Defendants are engaged in a false and misleading advertising campaign generally with regard to consumers and,
further, that Defendants are now contesting their representations of ownership. As such, Plaintiff believes that it is necessary for this Court to promptly address such issues to prevent further harm to the public from the false and deceptive advertising campaign and denial of ownership. Plaintiff may file a new Motion for Preliminary Injunction with regard to such specific issues.

Defendants agree with Plaintiff that that the relief sought in Plaintiff’s pending motion for preliminary injunction should be consolidated with the trial on the merits. However, given that Defendants anticipate that Plaintiff’s claims will be substantially limited as a result of motions for judgment on the pleadings or summary judgment, and given the issues presented by Linden’s counterclaims against Plaintiff, Defendants do not believe it would be practical or serve judicial economy to advance the trial on the merits for consolidation with the pending motion for preliminary injunction pursuant to Rule 65(a)(2).

Defendants will seek discovery with regard to the following issues, among others that may arise depending on the admissions and denials and defenses presented by Plaintiff in his answer to Linden’s counterclaim:
• Support for Plaintiff’s allegations in the pleadings;
• The specific representations on which Plaintiff claims he relied, and in what way they were materially false or misleading;
• Plaintiff’s motivation, purpose, or intent in registering for and using the Second Life service;
• Plaintiff’s knowledge of the Second Life Terms of Service and other provisions governing his usage of Second Life;
• Plaintiff’s communications with third party Second Life users in connection with the alleged auction scheme;
• Plaintiff’s assertion that his allegedly fraudulent activities were condoned by Defendants;
• Plaintiff’s activities in furtherance of the alleged auction scheme;
• Plaintiff’s alleged economic relationships with third parties with which Plaintiff contends Defendants interfered;
• Plaintiff’s claims for damages.

Plaintiff’s subjects of discovery include: the allegations and claims set forth in the complaint; representations/communications with third parties by Defendants; the statements, allegations, and admissions made in Defendants’ answer/counterclaims; the use of metaphors in communications by Defendants with third parties including consumers, venture capitalists and other investors; Defendants’ procedures and information surrounding the land auctions in Second Life; the sale of virtual land and the representations made about such sales; the revenue and/or profits obtained from land sales and taxes on such land sales; the drafting of the Terms of Service (“TOS”) Agreement; and, Defendants’ alleged counter claims. Plaintiff also indicated that discovery is needed to determine whether additional parties will need to be joined as Defendants.

Although the parties have exchanged and commented on a number of drafts of this statement, defendants’ counsel did not receive from plaintiff’s counsel either comments on this version or approval to file in this form by close of business Pacific Time this date. Thus although defendants believe this report fairly sets forth plaintiff’s positions, it is only signed by defendants’ counsel.


[In regard to the lack of Plaintiff’s signature on the Joint Rule 26(f) statement] [t]he cited paragraph should read, ‘although Defense counsel refused to include Plaintiff’s positions in the Rule 26 (f) report, rather than not file the report, Defense counsel refused to agree to include Plaintiff’s positions all day until he could unilaterally file the report after the close of business Eastern Time so as to mislead this Court.’

Defendants stated that while there was a general business practice of preservation of material, there have been changes made to the websites at issue and that electronic material such as chat logs, land auctions, etc. may have been deleted in the ordinary course of business.

Plaintiff opposes a blanket confidentiality agreement and that the scope of any proposed confidentiality agreement was unclear to Plaintiff. No such proposed confidentiality agreement has ever been provided to Plaintiff. Plaintiff indicated his willingness to consider a confidentiality agreement to cover specific trade secrets and believes that any such information should be considered on a case-by- case basis. It is Plaintiff s position that confidentiality is particularly inappropriate given that the Defendants sought to obtain confidentiality through their arbitration clause, and that such clause was deemed unconscionable.

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7 Responses to “Bragg v. Linden Lab Update – FRCP 26(f) Report and Plaintiff’s Motion to Strike and/or Amend”

  1. on 17 Jul 2007 at 12:54 pmcsven

    Thanks for the update. I’m finding the confidentially issue particularly interesting.

  2. on 17 Jul 2007 at 4:06 pmBenjamin Duranske

    Csven – I think it’s interesting too, but it might not be as much an issue of Linden Lab trying to hide the ball as it initially appears. Agreements to protect third party information (typically in the form of “Stipulated Protective Orders”) are almost standard issue in litigation involving big companies, simply because there has to be some way for the company to stamp documents that it is producing that are covered by agreements with third parties where they’ve promised to protect the data.

    Here, Linden Lab is going to have to give up documents that are protected by confidentiality agreements it has with third parties (probably including Second Life users other than Bragg, though I’d need to go back and read the Second Life TOS and privacy policy to make sure that’s true, but certainly including other companies like payment processing companies, etc.)

    It will need to stamp those docs “Highly Confidential – Attorney Eyes Only” or something along those lines so that they can’t be attached to filings that aren’t sealed. The court will typically have a clear procedure for filing documents that contain confidential information, and the parties are, in my experience, typically expected to execute some kind of agreement to make this happen in accordance with the Court’s rules.

  3. on 17 Jul 2007 at 4:51 pmAble Whitman

    I am most interested in the implications that Linden Lab keeps logs of resident communications, like chat and IMs. In particular, this quote from the 26(f) caught my eye:

    “Defendants represented that to the extent they exist, records of Plaintiff’s online chats with other Second Life users regarding the alleged auction scheme would be produced in hard copy form.”

    And in the plaintiff’s motion, the assertion that “there was a general business practice of preservation of material” is somewhat troubling. Of course such logging on the service side is technically possible, but it’s my expectation as a user that my conversations inworld are ethereal; that LL is not keeping a persistent log of my chat and my IMs.

    Of course such logging is available on the client, but it’s not the same thing. I can choose to disable my client’s logs, and I can choose to communicate only with friends I trust not to be logging our conversations (or with whom I’ve comfortable with logging them). And at least I can restrict what information I tell other residents, regardless of whether I trust them or not.

    But communication logging on the service side is entirely different. It would be entirely unavoidable since inworld communication relies on the service and cannot function without it.

    I know that LL’s TOS prohibit posting of other peoples’ chat logs, but I’m not sure what their stated policy is (if indeed there is one) regarding communication data retention. To be fair, I checked the privacy policies for MSN Messenger ( and for Google Talk ( and neither of them mentions a policy regarding service-side logging, either.

    I’m curious to find out more as discovery proceeds about what kind of data LL retains and for how long. Is it likely that such chat logs would fall under a confidentiality agreement, or would they be part of the public record? And even if they are deemed confidential, what kind of information could we expect to learn about LL’s methodology of data retention?

  4. on 17 Jul 2007 at 6:57 pmTateru Nino

    Every simulator retains a record of every interaction for something like 90 days, if I recall LL’s statements on this correctly. That’s object and script interactions, lines of chat, IMs, everything. Apparently not everyone at LL has access to those logs, and they are used only for debugging and verification of incidents in abuse reports. There was a post on the Linden blog about it somewhere.

  5. on 17 Jul 2007 at 7:10 pmNobody Fugazi

    Looks like jockeying for position, plain and simple. I am interested most in the misleading advertising allegation; if a court ruling came on that it would certainly be a precedent.

    If the court says, yes, the ‘ownership’ issue is misleading – whereas Linden Lab has publicly stated that now it is a service… well, that is certainly more representative than ‘own your own land’. ‘Owned by residents’ – really?

    If the court sets that precedent, then Linden Lab becomes a service provider and even a publisher (related to ‘broadly offensive’, et al). Personally, I think this would be the intuitive way to proceed – but then, I think Lessig should have won with Eldritch, so who knows.

    What Bragg is doing here is actually probably beneficial in the greater community in this aspect. Linden Lab has been pretty fluid with how it defines itself, and hasn’t been very transparent in how they handle violations of Terms of Service and Community Standards. Getting them to define themselves, or, have the Court define them in the context of this case is probably the most important legal issue for Linden Lab. You can’t be everything to everyone.

  6. [...] The parties also filed a joint Rule 26 statement on July 20 (signed by both, this time). It appears designed to replace the one that Defendants filed on their own after negotiations broke down over the contents of the report three weeks ago. There only two changes between the two reports. Here they are: [...]

  7. [...] Recently, VB began a new feature: closely examining filings in cases related to virtual law. Regular readers will notice that these posts contain only a tiny bit of opinion and not much personality at all. As I pointed out when I first ran one of these, there’s an important reason for that. Since these posts are such a departure from my usual style, however, I am going to repeat that reason now in a standalone post so that I can permanently link to it in the sidebar. Along with that, I’ll touch on the difference between VB’s commentary on gray areas in the law and issues that are more settled. [...]

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