FatWallet Challenges Abusive DMCA Claims and Protects Users’ Privacy Rights

Contact: Megan E. Gray, 202-265-2738
Deirdre K. Mulligan, Samuelson Law Dir., 510-642-0499
Tim Storm, 815-623-3750 x202
Erin Campbell, Communications Dept., 510-643-8010, ecampbell@law.berkeley.edu

Berkeley, CA – In a blatant misuse of the Digital Millennium Copyright Act, over the past two weeks, a group of national retailers forced FatWallet.com to remove Day After Thanksgiving sales information from its site. In letters sent to FatWallet, each retailer claimed that the Copyright Act gives it a monopoly over this price data. Today, FatWallet.com challenges those letters as abuses of federal law, insists on damages, and refuses to disclose identifying information on the individuals who posted the sales information.

FatWallet.com is a venue for consumer-to-consumer communication as well as business-to-consumer marketing. FatWallet is represented by Megan E. Gray, of Gray Matters, and Deirdre K. Mulligan and Jennifer Urban, of the Samuelson Law, Technology & Public Policy Clinic at the University of California, Berkeley, School of Law (Boalt Hall).

FatWallet’s site allows individuals to post information about sales prices, store reviews, and shopping tips. In the last two weeks, several individuals anonymously posted information about the upcoming Day After Thanksgiving sales. Wal-Mart, Kmart, Jo-Ann Stores, and other retailers immediately sent letters to FatWallet.com claiming, under penalty of perjury, that each owned a protectible copyright in this pricing information.

FatWallet reluctantly deleted this allegedly infringing information to avoid potential liability, but FatWallet now demands that the retailers justify their actions. Tim Storm, President and Founder of FatWallet, remarked, “The saying used to be that the customer is always right – our feeling is that customers have rights, and we are not going to let frivolous DMCA claims interfere with a consumer’s ability to share information about retailers.”

Today, FatWallet sent each retailer a letter contesting its frivolous copyright assertion and demanding payment, under Section 512(f) of the DMCA, for all damages, including costs and attorneys’ fees, incurred by FatWallet in addressing the knowing and material misrepresentations of copyright protection. According to Megan E. Gray, “As the retailers well know, simple sales prices are not protected by copyright. Copyright only covers the expression of ideas, not facts.” Deirdre K. Mulligan noted, “This is an example of corporations using allegations of copyright infringement to silence speech.”

Wal-Mart went further than the other retailers, filing, under penalty of perjury, a declaration with federal court in Illinois and obtaining a subpoena under Section 512(h) of the DMCA that ordered FatWallet to identify the individual who posted Wal-Mart sales information. Deirdre K. Mulligan said, “This is an outrageous example of a corporation contorting copyright law and attempting to use the DMCA to out the identity of an individual sharing factual information. The DMCA’s subpoena provision, which allows an entity to demand the identity of an alleged infringer from an Internet service provider prior to filing a lawsuit, is controversial to begin with. Behavior like this shows how susceptible it is to abuse.”

FatWallet has demanded that Wal-Mart immediately withdraw that subpoena or face a Motion to Quash proceeding in federal court. Wal-Mart is expected to make a decision on Tuesday, December 3 about whether to withdraw the subpoena.

Tim Storm, of FatWallet, said, “Wal-Mart’s subpoena gave us no choice but to fight back. Unless a court rules otherwise, we’re not going to give up personal information about our users when the underlying copyright claim is baseless.”

Megan E. Gray is a principle in the law firm Gray Matters in Washington, DC. She represents many clients in connection with intellectual property matters, internet issues, online privacy, anonymous speech, and related issues. More information about Gray Matters can be found at www.megangray.com.

The Samuelson Law, Technology & Public Policy Clinic at Boalt Hall represents individuals and non-profits on privacy, copyright, and First Amendment issues relating to the Internet and other advanced technology. More information about the Samuelson Clinic can be found at http://samuelsonclinic.org.


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