The folks at Clever Zebra just announced a legal panel for the vBusiness Expo, which will be held in Second Life next week.

The panel will be Friday, April 25th at 12:00 noon, Pacific. It will focus on legal issues associated with doing business in virtual worlds, and will cover employment issues, intellectual property issues, and more, from both a U.S. and international perspective. The panel will be presented as a structured conversation, and there will be plenty of time for audience questions. I’m the moderator, and the panelists are a great group of attorneys:

• Doug Wolf – U.S. and international intellectual property law specialist.
• Dave Elchoness – Employment law specialist and CEO of VRWorkplace.
• David Naylor – Field Fisher Waterhouse (UK) partner; IP, media, and technology specialist, and president of the SL Bar Association.

I’m hoping for a really good discussion. The whole in-world four-day vBusiness Expo (April 24-27) looks like it is coming together really well. Hat tip to Nick and Caleb and the rest of the Clever Zebra folks for putting this together. If you’ve not registered yet, here’s a link to the vBusiness Expo registration page. The whole thing is free, but registrations are limited, so you should probably sign up soon if you’re planning to attend.

VB was just added to a cool web resource called Alltop for people who want to look at a lot of news feeds in one place without RSS hassles. There are a number of feeds there including “Celebrities,” “Egos,” “Design” and “Gaming,” among others. Here’s the “Virtual Worlds” news feed.

I’m not big on endorsements, and I don’t get anything for saying this, but Alltop just works for me. It’s a project of former Apple evangelist Guy Kawasaki, and it displays the clean look that you’d expect. The initial view shows only headlines; hovering your mouse over a headline pops up the first paragraph or so of the linked story. Clicking then takes you directly to the original article on the linked site. For now, at least, there aren’t any ads. Besides VB, Alltop’s virtual world news feed features over twenty sites including New World Notes, Reuters, Terra Nova, the Second Life Herald, Virtual Worlds News, and others. They add new ones with some regularity.

Alltop isn’t groundbreaking — RSS does this and gives you control over which sites you see, and there are other amalagamators out there too — but I hate how most amalgamators I’ve tried either destroy formatting or reproduce so much content that they’re basically vulturing posts from other sites, so I’ve never really gotten into them. I’ve bookmarked Alltop though, and I find myself hitting it fairly often, so I thought I’d pass it along.

Linden Lab, creator of Second Life, recently posted guidelines for protecting your copyrighted content in Second Life. The policy largely focuses on the DMCA (Digital Millennium Copyright Act). From the guidelines:

The DMCA provides a specific process for removing content that’s much faster and less expensive than a copyright lawsuit. Otherwise, courts resolve copyright claims – usually only after reviewing evidence about a work’s creation, ownership, permissions given, and defenses like fair use.

This is accurate; the DMCA is an important tool in a creator’s IP enforcement toolbox. Filing a DMCA notice is much cheaper than filing a lawsuit, and to the extent that an online service provider (which Linden Lab clearly believes it is, according to the guidelines) complies with the Act, it can be a very effective way for a creator to inexpensively police infringement. That said, it only works — and only shields the provider from liability for infringement — when both users and the provider comply with all of the requirements of the DMCA.

Commentary

There is a reasonable argument that in spite of its recent moves to make the DMCA process easier for users, Linden Lab is not complying with its obligations because it is not removing all infringing copies when DMCA notices are filed. This, arguably, opens Linden Lab to a lawsuit for vicarious or contributory copyright infringement by depriving it of the protections of the DMCA.

Let’s get this out of the way right off the bat: copyright infringement in Second Life is widespread. Some of it involves residents using the intellectual property of mainstream companies without a license (e.g. selling unlicensed Harry Potter and Star Wars products, playing streaming music in clubs without payment to the artists via ASCAP or BMI, selling unlicensed e-books, etc.) but a lot, probably the majority, involves residents selling unauthorized copies of other residents’ copyrighted creations. Because Second Life allows unfettered building and offers a fairly robust programming (“scripting”) language, users can, and have, created a number of tools that allow people to copy other people’s creations. These tools have non-infringing uses, so Linden Lab allows them, but takes action when they are used to infringe copyrights.

Linden Lab has always had a DMCA policy, but reports are mixed regarding the company’s diligence in following up. Some users have reported success, but others have said their notices are ignored.

My guess is that many of the apparently ignored requests were actually improperly formatted, though I’m sure there have been cases where properly formatted requests were overlooked. A few attorneys I’ve spoken with who represent virtual world users have said that requests filed on behalf of their clients have generally been acted on, although it often took some time. This may be because a request from a lawyer gets a bit more attention, or it may simply be that these requests are likely to include all of the required information.

As Linden Lab points out, the DMCA process is somewhat complex:

It’s important to note that the DMCA process is a legal process. The U.S. Congress created it for online service providers like Linden Lab because it’s hard for them to know whether a work is infringing without a court’s determination. So it’s critical to follow the steps in the DMCA policy. [...]

To help with information required under the DMCA, we’re also developing a new form for submitting DMCA claims. The goal of the form is to help Residents provide all the necessary DMCA information upfront and reduce the number of claims that require supplementation (which slows down the process because we need to ask the Resident who filed the claim for more information).

Streamlining the process should help users file complete notices. This makes it easier for Linden Lab to do what it is supposed to do under the DMCA.

There have also been complaints about the time it takes for Linden Lab to act on notices. If it takes eight weeks to remove infringing content (as creator ‘Cal Edman’ alleges), there is an argument that Linden Lab is not “acting expeditiously” to remove infringing copies, in violation of its DMCA obligations. The creation of the reporting tools mentioned in the guidelines, and the deployment of additional human resources to address DMCA notices (which Linden Lab also says it is now doing), should help address these concerns.

However, there is one significant criticism of the way Linden Lab handles DMCA requests that remains a serious problem: users report that Linden Lab only removes copies that are “in-world,” and does not remove copies from inventories or remove copied textures from its database. If this is true — and it appears to be given the widespread gnashing of teeth over the issue and Linden Lab’s silence on the question — there is a reasonable argument that Linden Lab is depriving itself of the “safe harbor” protection of the DMCA by not complying with its DMCA obligations.

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Virtual property company Internet Gaming Entertainment (IGE) has changed the law firm that is defending IGE (.pdf) in a Florida class action case, Hernandez v. IGE. IGE is now represented in that case by James M. Miller of Akerman Senterfitt. Prior to changing counsel, IGE was represented in the Hernandez case by several attorneys at Foley & Lardner, LLP. Neither Foley or Akerman represented either of the IGE founders in a messy California dispute that was recently, tentatively, settled.

Substitution of counsel can happen for any number of reasons including cost of representation, familiarity with local courts, and disagreements over tactics. Foley & Lardner, who formerly represented IGE in this case, is a larger firm with a stronger national presence, but Akerman is well-known in the Miami area and has a much larger footprint in southern Florida. IGE may have been hoping to find a firm with stronger ties to the local legal system, particularly in light of an announcement earlier this year that the Florida Attorney General’s office had opened an investigation into IGE’s gold farming activity, business dealings in Florida, relationship with other companies, and more. Neither the attorneys for IGE nor for Hernandez responded to emailed requests for comment.

For the background of this suit, see Virtually Blind’s complete coverage of Hernadez v. IGE. Very briefly, the suit involves an (as yet uncertified) class of users, led by Antonio Hernandez, suing virtual property dealer IGE for diminishing the World of Warcraft game experience through chat spam, gold farming, spawn camping, and other undesirable activity that arguably breaks Blizzard’s World of Warcraft Terms of Use. The legal theory behind the suit is that all World of Warcraft players are third-party beneficiaries of the Terms of Use, a contract between Blizzard and each of its players, including agents of IGE. Blizzard has publicly said it supports the suit, which could be critical in defining all players as “intended beneficiaries” of the Terms of Use, one step necessary to establish liability on the part of IGE under this theory.

Trial is currently scheduled for August 4, 2008, but the parties already appear to be behind the court’s anticipated schedule for discovery and motions, and substitution of counsel sometimes extends a case’s schedule if the new firm seeks and is granted additional time to get up to speed.