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Managing the Risks of User-Generated Content

This presentation provides an overview of the legal and reputation risks that website operators and intermediaries face when hosting User-Generated Content (UGC) in Canada and the U.S.

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Managing the Risks of User-Generated Content

  1. 1. Managing the Legal Risks of User Generated Content . Maanit Zemel, Esq. Lawyer & Founder MTZ Law Professional Corporation Federated Press 6th Social Media Risks Toronto, May 5 & 6, 2015
  2. 2. Overview  User Generated Content  Defamation risks  Intellectual property risks  Privacy risks  Advertising & marketing risks  Miscellaneous risks
  3. 3. What is User Generated Content (UGC)?  According to Wikipedia*, UGC is defined as: “…any form of content such as blogs, wikis, discussion forums, posts, chats, tweets, podcasting, pins, digital images, video, audio files, and other forms of media that was created by users of an online system or service, often made available via social media websites“. * Citing: Chua, Tat-Seng; Juanzi, Li; Moens, Marie-Francine (2014); Mining user generated content. Chapman and Hall/CRC. p. 7
  4. 4. Common Examples of UGC  Blogs  Content uploaded to social media (e.g. tweets; Facebook status, comments & likes; Linkedin posts)  Videos and photos uploaded / “pinned”/ tagged on content sharing sites (e.g., YouTube, Flickr, Instagram, Pinterest etc.)  Information / content uploaded to information websites (e.g., Wikis)  Online reviews (e.g., TripAdvisor; Yelp; Amazon, etc.)  Comments posted by users / readers / customers / followers on organizations’ websites
  5. 5. Some Statistics* (or - how can this lecture get any more interesting?!)  Number of pieces of content shared by Facebook users per minute?  Answer: 684,478  Annual revenue of Facebook from UGC?  1.86 Billion (2010)  Annual revenue of YouTube through UGC (2010)?  $945 million  Number of monthly active Instagram users (Dec. 2014)?  300 million * Courtesy of: http://www.statista.com/topics/1716/user-generated-content/. The author has no knowledge of, and makes no comment on, the accuracy and/or reliability of the information
  6. 6. Advantages of UGC  Engaging with customers and increasing loyalty  Attracting new customers  Increasing website traffic and search engine optimization  Brand and reputation promotion through positive reviews  Creating sense of openness and transparency  Marketing and advertising (e.g., contests)
  7. 7. Risks / Disadvantages of UGC  Legal liability of hosts / website operators / intermediaries for:  Defamation  Copyright infringement  Trademark infringement  Privacy infringement  Criminal offences  False advertising and marketing claims  Reputational / brand risks (e.g. negative review)
  8. 8. Liability of Website Operators for UGC  U.S.:  Section 230 of federal Communications Decency Act – grants website operators complete statutory immunity from liability for all claims, with the exception of intellectual property claims  Canada:  No statutory immunity  Liability would depend on the subject-matter of the claim  Liability may be imputed to websites operators / intermediaries – depending on circumstances
  9. 9. Defamation Risks  Canada:  Website operator / intermediary may be held liable for publishing online defamation  Baglow v. Smith (Ont. S.C.J., 2015)  Hyperlinking may be insufficient to raise liability (Newton v. Crookes SCC)  U.S.  Complete statutory immunity (s. 230)  SPEEACH Act
  10. 10. Defamation Take Down Notices / Requests  Canada:  If website operator / intermediary receives notice and does not take content down – increases likelihood of liability  Negative reviews are not necessarily defamatory  Recommendations:  Monitor and moderate website regularly for content that is clearly defamatory or offensive  If you receive take down notice – take it down  Consult with legal counsel when in doubt  U.S.:  Compliance is voluntary  Consider how your response may impact your brand / reputation  Consider ethical / moral obligations of not taking it down
  11. 11. Copyright Risks  Canada (Copyright Act) & U.S. (DMCA):  Online posting of copyrighted material without consent is prohibited  Website operators / intermediaries may be liable for copyright infringement if UGC contains copyrighted material
  12. 12. Copyright Risks & Take Down Notices  Canada (recent amendments to Copyright Act):  “Notice and Notice” regime – if ISP receives notice in prescribed format, must forward it to the alleged infringing subscriber. If does not follow specific notice requirements – may face liability for infringement  Liability of ISP capped  Unclear whether applies to website operators
  13. 13. Canadian Copyright Risks (Cont’d)  Exceptions / Defences: 1. “Non-Commercial User-Generated Content” exception If specific requirements are met, website operator / intermediary can rely on exception UGC must be used solely for non-commercial purposes (unlikely when the host / operator / intermediary is a commercial entity) 2. “Fair Dealing” defense available when UGC is used for specific purposes (e.g., research, news reporting, satire, parody, education etc.) Specific legal test must be met
  14. 14. U.S. Copyright Risks  U.S. (DMCA):  No liability to ISP / intermediaries / website operators so long as they have no knowledge of the infringing material & receive no financial benefit (“safe harbour” provisions)  Once placed on notice - must remove or face potential liability  Specific notice and take down requirements must be followed (including notifying alleged infringer)
  15. 15. Copyright Risks (Cont’d)  Some Recommendations:  Include clear prohibitions against copyright infringement in terms of use  Designate a copyright / DMCA agent  Provide clear guidelines and easy access for take down notices  Promptly comply with take down requests  If website is used for non-commercial purposes – consider relying on the exception  When in doubt – consult with legal counsel
  16. 16. Trademark Risks  Similar to copyright. Canada and U.S. law protects registered trademark owners  The posting of a registered trademark in UGC may give rise to liability in Canada and U.S. for trademark infringement  Website operators / intermediaries may also be liable:  Recommendations:  Monitor / moderate UGC for clear trademark infringement  Consult with legal counsel upon receipt of notice
  17. 17. Privacy Risks  Canada:  PIPEDA and other provincial statutes  Prohibition against collection, disclosure and use of personal information without knowledge & consent (e.g., name, address, email address, gender, employment, etc.)  Email harvesting prohibited (CASL)  Privacy statutes do not apply to individuals – website operators may not be liable for UGC containing personal info posted by individual (ex., personal blog)  Common law – Intrusion Upon Seclusion claim
  18. 18. Privacy Risks (Cont’d)  U.S.:  No comprehensive federal privacy regime  Regulates use of private information in advertising and marketing (Federal Trade Commission)  Recommendations:  Develop, implement and publish clear and detailed privacy policies  If receive notice, consult with legal counsel
  19. 19. Advertising & Marketing Risks  Canada (Competition Act) & U.S. (Lanham Act):  Prohibitions against false / misleading online advertising & marketing practices and representations (Competition Act)  Examples in the UGC context:  False / misleading reviews / testimonials / comments  Online contests (e.g., Subway v Quiznos case)  Inaccurate / misleading endorsements (e.g., on Linkedin)  Recommendations:  Do not post false / misleading reviews / testimonials  Prohibit employees from posing as consumers to post reviews / testimonials  Set clear guidelines for reviewers / commentators / contest participants  Consult with legal counsel
  20. 20. Criminal / Regulatory Offences  Website Operators / Intermediaries may face criminal liability in Canada & U.S.:  Example Includes  Cyberbullying laws (Canada)  Hate Speech laws (Canada)  Child pornography laws (Canada)  Criminal defamation laws (Canada)  Protection of Canada from Terrorists Act (Canada – not yet in force)  Criminal copyright infringement (U.S.)  Illegal gaming (international)
  21. 21. QUESTIONS? Maanit Zemel, MTZ Law mzemel@casllaw.ca / @maanitzemel / www.casllaw.ca Disclaimer: This presentation is provided as an information service and is a summary of current legal issues. The information is not meant as legal opinion or advice and viewers are cautioned not to act on information provided in this publication without seeking specific legal advice with respect to their unique circumstances. © All rights reserved. This presentation may not be reproduced and redistributed without the prior written consent of the author.

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This presentation provides an overview of the legal and reputation risks that website operators and intermediaries face when hosting User-Generated Content (UGC) in Canada and the U.S.

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