Paul Jacobson

Ramble on

A complete treatment of this topic would probably take up a number of hefty volumes so this chapter is not intended to cover all aspects of doing business in South Africa. There are many brilliant, knowledgeable and expert writers and professionals in South Africa who could speak far more authoritatively on the range of topics that fall under the general header of “SA Inc and the business of doing business in South Africa”.

Instead I am going to mention two topics which I am both passionate about, regard as two very hot topics in the near future and which are, themselves, are subjects of entire books and which SA Business should bear in mind when doing business in South Africa: privacy and content licensing. These topics are going to be of interest for those businesses which are interested in or involved in the growing social media space.

While content licensing and privacy are the topics that tend to attract the most attention when I chat to business people about them, freedom of expression and unlawful competition are two topics I won’t deal with in this chapter due to space considerations in the context of this blook as a whole but which are arguably equally important. Which topics are more relevant and therefore important to you may be a matter of perspective depending on what your focus may be at a given point in time.

Privacy

Privacy has always been an issue business has had to tackle although not terribly vigorously. Privacy issues in the workplace have often included personal communications and personal relationships in the workplace and have been dealt with through internal policies on issues ranging from the acceptable use of the organisation’s IT infrastructure to policies that deal with the prickly topic of sexual harassment.

The need to give substance to the right to privacy in the Bill of Rights and the increasing amount of personal information that is becoming available both online and offline in all spheres (and the growing need to safeguard that potentially sensitive information) have given rise to draft legislation presently doing the rounds in our legislature.

This is not a new process and in many ways the draft legislation mirrors developments abroad, including in the European Union. Without going into the legislation in much detail (yet another volume in itself), it defines personal information and through a series of voluntary and mandatory mechanisms it seeks to strike a balance between the need to safeguard personal information when processed by public (for example, government bodies) and private (for example, businesses) bodies, the need to protect and give substance to the right to privacy and the desire to facilitate the appropriate flow of personal information.

I use an extract from the draft legislation in a presentation I give on these topics and in which I highlight some of the examples of personal information. Although few people can actually read the extract in the slide because the font is so small, the highlights demonstrate the fairly broad scope of the definition and highlight the need to take a more active interest in how this draft legislation may impact on South African businesses.

An unfortunate consequence of a growing complexity of issues pertinent to business is that it is necessary to introduce a range of measures to reduce and manage the risks that accompany this growing complexity. One of these measures, at least in this context, is a clear privacy policy that informs both internal stakeholders and customers what personal information the company is collecting and how that personal information is being used. These uses are guided by the draft legislation and it is vital that this information be communicated to these people.

The draft legislation also envisages imposing a series of obligations on businesses to secure their stores of personal information and to retain that personal information subject to specified guidelines. Add a range of exemptions and prohibitions to the mix and businesses are facing a far more complex privacy landscape which needs to be navigated with considerable care.

Bottom line: things are about to become really interesting in this space.

Content licensing

For the most part Business SA either doesn’t think too much about copyright or views it as a shield to protect it from the horrors that ravage the intellectual property countryside that include plagiarists and unimaginative bloggers who are too loose with the “Copy” and “Paste” commands.

Copyright certainly has a valuable place in that intellectual property countryside. One of its most important functions is to protect original content and, in the process, it encourages content creators to develop more original content. The difficulty with copyright is that, as a bundle of exclusive rights, it does not always fit in well with the growing social media trend (if you can call it that) and with consumers’ desires and habits.

One question I often ask people is how many of them tend to download or copy interesting content they see on the Web without thinking too much about little things like who owns the copyright in that content and whether consuming that content in that way is consistent with the copyright owner’s intentions and rights. At the risk of oversimplifying the issues, people want to go online and freely share what they find with their friends, family and colleagues. This act of sharing often takes the form of copied text and images being distributed by email, printed out and passed around or even incorporated into blogs and other online social media platforms.

The problem with this tendency, of course, is that many of these uses are forms of copyright infringement and while there are a number of exceptions to general copyright infringement the exceptions themselves are sometimes not terribly clear or helpful.

There is an alternative to simply relying on the protections afforded by copyright and its exceptions to copyright infringement. If your goal, as a content creator, is to ensure that your content is made available to the biggest audience possible within certain parameters which may protect your business model, the integrity of your content or ensure that any sharing perpetuates your open access ambitions then you will be thinking about some form of license for your content. The immediate challenge is how to properly license your content and make sure that the considerations that need to be addressed are, in fact addressed.

One option is to go to an attorney have have a custom made license prepared. A license will grant its user certain rights in the content concerned which, in turn, will enable the user to make use of the content in a way that would ordinarily be prohibited. This has its advantages because you will have a license that does exactly what you want it to do (that is, permit certain uses and prohibit others). The disadvantages include the costs involved and the possible inability to understand the terms of the license unless you have degrees in Latin and advanced legalese.

The second option will be far more appealing to many content creators. Creative Commons licenses are ready made content licences that permit a range of uses of content depending on the license adopted (there are six core licenses). These licenses are customisable to a degree in that you can choose which elements to include in your license to supplement elements that are built into every Creative Commons license, such as the ability to share the content privately, the requirement that authors of the content concerned be attributed properly and the perpetual term of the licenses. The rights granted by a Creative Commons license may include the ability to create a derivative work of the content (something like a remix of a song, perhaps?), the right to exploit a work commercially or perhaps the requirement that adaptations of the content be distributed under a similar Creative Commons license.

One thing for SA Business to bear in mind, especially in the push to integrate social media into an online presence, is that Creative Commons licenses can be powerful tools which can be used to help spread content as widely as possible. This makes a lot of sense where a business has a blog or otherwise publishes its content on the Web with the intention that it reach as many people as possible. Additional protocols like the recently introduced CC+ protocol enable businesses to integrate their commercial licenses into a non-commercial Cretive Commons license. One benefit of this is to present a licensed version of the content that can be freely shared while preserving a commercial model. A good example of a service that uses a similar model is the popular tutorial service, Common Craft.

What I constantly find remarkable about these legal constructs is the very real impact they can have on creative expression. Although copyright was originally intended to protect and promote creative expression, it has become almost synonymous with protectionism and restrictions on content usage. It is unfortunate but it has paved the way for tools like Creative Commons licenses and similar free content licenses to free content creators to express themselves more freely secure in the knowledge that they have struck a balance between sharing and spreading their ideas and passions and, at the same time, ensuring that their content is used in a way that best achieves that expression. Just what form that expression takes and how it manifests will vary from one content creator to another, whether that content creator be an artist, a writer or Chief Executive blogging about his hopes and dreams for his company.

Levelling off

Without a doubt privacy and content licensing are critical issues that SA Business needs to pay careful attention to, especially as more and more local businesses provide services and publish content online. Two topics I wasn’t able to deal with in this chapter introduce further dimensions of complexity and perhaps greater challenges for many businesses: freedom of expression and unlawful competition. These seemingly unrelated topics come together in a very interesting and yet somewhat disturbing way for many businesses in the context of social media in particular and also merit very careful consideration.

One message I try to communicate whenever I speak about these topics is that as much as they may complicate an already confusing landscape, the risks they represent can (and should) be managed and, in the process, reduced. Doing so requires a little research and planning but the benefits of these foundational steps will soon become apparent in a variety of ways, all of which add to the tremendous promise and potential of doing business in South Africa.

Now read the rest of the blook chapters:

Introduction
1. The new South Africa – is it real?
2. Is SA rich or poor?
3. What the world thinks of South Africa and what our global opportunities are
4. The importance of each individual’s contribution collectively
5. SA Inc and the business of doing business in SA
6. The beauty and grandeur that surrounds us
7. The importance of technology in SA’s global emergence
8. Building brand South Africa
9. Making the most of SA’s creative talents and abilities
10. Innovate for a better South Africa
11. The role of the younger generation in SA, and what we need to do to support them
12. Connecting South Africa – Communities that transcend technology
13. We are African – the role of collaboration in South Africa’s growth

Chapter 5, SA Inc and the business of doing business in SA by Paul Jacobson is licensed under a Creative Commons Attribution-Non-Commercial-No Derivative Works 2.5 South Africa License.
Based on a work at pauljacobson.org.

Technorati Tags:
content licensing, copyright, creative commons, south africa, blook, sa blook, opportunities, privacy, legislation, sa business

I gave a presentation at a Marcus Evans sponsored event called “Corporate IT Security” in Rosebank this afternoon. I spoke about new media and some of the social media and legal issues companies should bear in mind when implementing new media initiatives.

I was only at the event for the afternoon of the last day and I was told that social media was a pretty hot topic in between the pretty technical security orientated presentations. I enjoyed the presentation and had some good feedback from an audience which included delegates from other African countries. I converted my slideshow into a video if you would like to get an idea of the topics I covered:

The music is a track called “Time (Instrumental)” by Ben Riordan and is available under a Creative Commons Attribution license 2.5 from ccMixter.

This slideshow is also a nice preview of what I will be talking about at our upcoming New Media and Technology Law @ Work workshop on 30 October so if this appeals to you, why not book your place at the workshop.

Technorati Tags:
new media, corporate it security, marcus evans, presentation, social media, slides, video, technology

Matthew Buckland published a post yesterday about the domain “facebook.co.za” and how it hasn’t been registered by the real Facebook company (which is just silly given that it costs about R100 to register a co.za domain name for the first year and about R50 each year thereafter). The only thing you see when you visit the domain “facebook.co.za” in your web browser is a Google AdSense panel so the intention of the registrant of the domain, Chris Mills, is pretty obvious – make as much money as is possible from people who navigate to the page looking for the real Facebook.

Another likely reason to register the domain is to sell it at a profit to the real Facebook company on the assumption that they might want to buy the domain for their own purposes. This is where Chris is going to hit a bit of a speed bump. According to Wikipedia, cybersquatting is -

… registering, trafficking in, or using a domain name with bad-faith intent to profit from the goodwill of a trademark belonging to someone else. The cybersquatter then offers to sell the domain to the person or company who owns a trademark contained within the name at an inflated price.

Besides being so Web 1.0, it is also potentially going to be regarded as an offensive or abusive registration of a domain name which could lead to an order that the domain be transferred to the real Facebook company if contested in arbitration. Depending on how Chris uses the domain going forward, he could also expose himself to a claim for passing off which is a form of unlawful competition which also touches on our law of common law trademarks.

Matthew’s post focuses on the illegality of the site at facebook.co.za because of an apparent infringement of Google’s terms and conditions for AdSense ads and that may well play a part but it really has nothing to do with the real Facebook company and everything to do with Google and Chris. The party most likely to be offended by this act of cybersquatting is the real Facebook company who could file a dispute with a dispute resolution body accredited with the .za Domain Name Authority over the registration of the domain and could have the dispute heard by between one and three adjudicators for between R10 000 and R24 000 (in the case of SAPIIL which is an accredited alternative dispute resolution provider).

If you are interested in this sort of thing you may want to check out the first dispute decided on this issue. Bear in mind that specific facts of the Mr Plastics case distinguish it from the facebook.co.za matter.

Update:
I just noticed this clause in the Facebook terms:

32665, FACEBOOK, THE FACEBOOK, FACEBOOKHIGH, FBOOK, POKE, THE WALL and other Company graphics, logos, designs, page headers, button icons, scripts and service names are registered trademarks, trademarks or trade dress of Company in the U.S. and/or other countries. Company’s trademarks and trade dress may not be used, including as part of trademarks and/or as part of domain names, in connection with any product or service in any manner that is likely to cause confusion and may not be copied, imitated, or used, in whole or in part, without the prior written permission of the Company.

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facebook, cybersquatting, domain name, co.za, .za Domain Name Authority, offensive registration, abusive registration, adr, alternative dispute resolution

I noticed a report in ITWeb yesterday that Verizon’s Rivonia offices were sealed yesterday while a civil search and seizure order was executed on the premises and the staff in the office at the time.  According to ITWeb:

[ Johannesburg, 31 August 2006 ]  – Verizon Business’s Gallo Manor offices were sealed this morning, and all employees have been locked in, following a court search and seizure order.

“An Anton Piller order has been served on our clients by Dimension Data, trading through Internet Solutions, under the terms of which a search and seizure order has been granted by the court in order to preserve evidence,??? says Sue Hayes, attorney at Cliffe Dekker Incorporated, representing Verizon.

An Anton Piller court order provides for the right to search premises and seize evidence without prior warning. This is used to prevent the destruction of incriminating evidence, particularly in cases of alleged trademark, copyright or patent infringements.

“No staff are permitted to leave until the collection of evidence has been done – this should be by end of business today,??? adds Hayes.

Anton Piller orders are often used in unlawful competition proceedings in an effort to preserve evidence to be used in further proceedings.  The power of such an order is derived from the manner in which is obtained.  The party requiring such an order approaches a judge in chambers without notice to the other party (both aspects are highly unusual) and if that party satisfies the judge that the order is warranted, the party will be given the go ahead to effectively raid the other party by surprise and search for and seize a specified list of items.

The order can be very effective and at the same time is not to be used lightly.  What we will see are further proceedings between Dimension Data and Verizon soon.

By the way, the order takes its name from an English case which effectively gave rise to this sort of order in South Africa.

Technorati Tags: anton piller, cliffe dekker, court order, dimension data, internet solutions, sue hayes, search and seizure, verizon

Yahoo! has sued a start-up competitor, Mforma, and seven former employees for allegedly stealing confidential information from Yahoo!.  CNET News.com has reported as follows:

“A California state judge has given Yahoo its first legal win against a start-up that Yahoo sued for stealing trade secrets.

Yahoo sued San Francisco-based wireless content provider MForma earlier this week, contending that a group of former Yahoo employees left the company and took proprietary source-code and business information to their new jobs.

A judge on Wednesday granted Yahoo’s request for a temporary restraining order, barring MForma employees from using or disclosing any proprietary Yahoo information in their work.”

Yahoo!’s restraining order appears analogous to what we call an interim interdict in South Africa and which, if the procedure is similar to ours, would be a precursor to further proceedings in due course.  As distasteful as it may seem, often a company’s only feasible course of action is to launch proceedings against a competitor and even former employees if confidential information and trade secrets are misappropriated.  Another important consideration is that if a company is slow to act against such unscrupulous employees, it may become a target for similar action by future employees and even competitors.  If this has happened to you (or is happening to you), consider the total impact it may have on your business going forward and it will impact materially, seriously consider taking action as quickly as possible.

For more on this story as it develops, take a look at Google News.

(via Buys Inc)

Technorati Tags: Mforma, unlawful competition, restraining order, Yahoo!

Google has been sued a number of times for trademark infringement in the United States largely due to the way companies advertise through Google.  A recent lawsuit was brought by American Blind which has claimed that Google’s sale of terms such as “American blind” and “American blinds” to competitors of American Blind constitute an infringement on American Blind’s trademarks.  According to InternetNews:

“In an escalating legal battle with big implications for search marketing, Google has been hit with a lawsuit claiming that its sale of the terms “American blind” and “American blinds” as keywords involves trademark infringement.

American Blind and Wallpaper Factory filed a complaint against the search giant, as well as its distribution partners, AOL, Ask Jeeves and EarthLink, in a New York federal court Tuesday. The suit comes a week after AOL settled a suit with Playboy involving similar issues.

The suit claims Google’s practice of selling text ads related to keyword search terms takes advantage of American Blind’s trademarks, because competitors’ ads can appear on results pages that appear when users search for “American blinds” and “American blind.” American Blind is asking that Google be permanently stopped from selling those keywords.”

These text ads appear not only on Google’s search results pages but on websites worldwide that participate in Google’s AdSense program.

In a South African context this raises an interesting question in my mind.  Could it be argued that a similar practice of using a competitor’s trademark (or even its name) either in similar advertising or even in the metadata keywords embedded in your website’s code constitute passing-off?  So what is passing-off?  According to Amler’s Precedents of Pleadings (6th edition):

“A passing-off action protects the goodwill or reputation of a trader’s business, merchandise or services against a false representation by a competitor to the effect that the business, merchandise or service of the competitor is that of the plaintiff or that it is associated with the plaintiff.  It also provides protection against deception as to trade source or trade connection.”

Website owners have used certain keywords in the hidden code in their websites to manipulate search results on search engines like Google, Yahoo! and MSN Search for years now.  For example, you find that an airline will include the word “sex” in its website’s metadata because that term is a popular search term.  What if, instead of using popular generic terms, a company uses its competitor’s name or trademark in its metadata or buys an ad on Google using keywords relating to its competitor in an effort to ensure that even when someone searches for the competitor, that company’s results appear on the search results page?  There may well be an argument that the company is passing itself or its services off as being associated with the competitor.

The problem is nicely expressed in a quote on in the InternetNews article from a representative of American Blind:

‘”We have a federal registered trademark for American Blind and Wallpaper Factory. We do object if you go to Google and type in that exact phrase that consumers may misleadingly be directed to a competitor’s link,” Rammelt said.’ (emphasis added)

Technorati Tags: American Blind, Google, passing-off, trademark infringement