Monthly Archives: December 2011

Illinois Appeals Court Protects Anonymous Poster In Internet Defamation Lawsuit

Online Defamation Lawyer
Illinois court weighs in on anonymous speech in Internet defamation lawsuits.

Back in 2009, an Internet defamation fracas began in Illinois. A truly 21st century legal standoff, the cyber libel lawsuit of Stone v. Hipcheck16 involved a local election, one politically-minded parent and the arguably bawdy smack-talk of at least one teen-aged blogger.

The case was watched by many for its Internet privacy implications. And sure enough, the decision of the Illinois appeal’s court has further cemented the state’s legal standing when it comes to online anonymous speech.

How The Internet Defamation Lawsuit Began: Internet Smack Talk

It was 2009, and thanks to the Buffalo Grove Village local elections, things were heating up on the Daily Herald’s message board. Thus was the political climate when two posters, “Uncle W” and “Hipcheck16,” became embroiled in an online debate.

After some online back-and-forth, Hipcheck16 correctly guessed that Uncle W was Jed, son of Buffalo Grove Village candidate, Lisa Stone. After admitting his identity, Uncle W/Jed challenged Hipcheck16 to a face-to-face political debate, to which Hipcheck16 answered:

“Thanks for the invitation to visit you…but I’ll have to decline. Seems like you’re very willing to invite a man you only know from the Internet over to your house – have you done it before, or do they usually invite you to the house?”

Hardy, har, har. A not so clever, albeit typical, Internet message board response – right? Well, Jed’s mom wasn’t able to shake off what she interpreted as an assertion by Hipcheck16 that her son “solicited men for sex on the Internet” and decided to file an Internet defamation lawsuit on her Jed’s behalf.

The Internet Defamation Lawsuit Trial Court Ruling

In an effort to unmask Hipcheck16, Lisa Stone filed for a pre-suit subpoena which asked that Comcast, Hipcheck16’s Internet service provider, reveal Hipcheck16’s true identity. But someone at Comcast was aware of proper protocol, and instead of just handing over the information to the Stones, they alerted Hipcheck16 of the information request along with an explanation of every citizen’s right to fight these types of subpoenas. Hipcheck16 opted to fight the request on First Amendment grounds.

During the first trial court go-round, Cook County Circuit Court judge, Jeffrey Lawrence, ordered that Hipcheck16’s identity be turned over to Stone for purposes of pursuing an Internet defamation lawsuit. That being said, while the judge ostensibly ruled in Stone’s favor, he also stayed the order, thus allowing the appellate court time to consider the important Free Speech issue. In addition, the trial court also ordered Stone to identify, in particularity, Hipcheck16’s defamatory statements.

Appeals Court Ruling

When the case hit the appellate court bench, they first ordered Stone to outline why, exactly, she needed to uncover Hipcheck16’s identity; moreover, the court asked that she provide a cogent argument as to the validity of her legal Internet defamation claim — both requests qualify as fairly normal procedural fair.

To paraphrase, over the course of the appeal’s court proceedings, Stone’s side revealed that the exact claim of defamation is based on the allegation that Hipcheck16 insinuated Jed solicited sex from men on the Internet. Stephen Tyma, Stone’s lawyer, argued that First Amendment rights were important, but such protection should not be given in instances where “sexual insinuations about children” were involved.

For their part, the court put forth a four-part standard for determining whether or not the name of an anonymous individual should be revealed for purposes of proceeding with an Internet defamation lawsuit. These standards being:

(1)    Verification; Must be verified (signed by party);

(2)    Detail facts that support a defamation cause for action;

(3)    Plaintiff can only seek identifying information relevant to the matter at hand; and

(4)    (a)Unnamed person must be the liable entity that will be responsible for damages if found guilty


(b)Party requesting identity must prove that they would survive a motion for summary judgment – not just a motion to dismiss.

The Final Verdict:  Who Won This Internet Defamation Lawsuit

In the end, Stone rested her son’s case and Hipcheck16 emerged victorious in this Internet defamation lawsuit. What factors led to Hipcheck16’s win?

First and foremost, Hipcheck16 never flat-out said, “Jed solicits men for sex on the Internet.” Instead, s/he asked a question, “…have you done it before, or do they usually invite you to the house?”  Intrinsic in the legal definition of defamation is the premise of a “false statement” – the operative word being statement. So Stone’s assertion that Hipcheck16’s interrogative was defamatory fell short on the defamation definition front.

Secondly, defamation law incorporates context. Essentially, when deciding on defamation lawsuits, judges will consider whether or not a reasonable person would actually believe the statement(s) in question. (This idea is a central aspect of the now infamous Hustler Magazine v. Falwell defamation lawsuit.) Upon reviewing the facts of this Internet defamation case, officials decided that the “tenor” of the conversation would lead most people to assume that the two parties involved only knew each other from the Internet and therefore had no real knowledge of each other’s’ lifestyle – another factor hurting the defamation claim.

Thirdly, U.S. legal precedent asserts that if an allegedly defamatory statement can be innocently construed, then it should be. In this case, Hipcheck16 could have argued that when making the statement, s/he was genuinely talking about inviting men over to the house to discuss politics, not sex.

At the end of the day, Stone et al did not have a strong Internet defamation case to begin with; but nonetheless, the lawsuit helped in cementing Illinois legal precedent with regards to anonymous Internet speech standards.

U.S. Resident Arrested For Online Defamation; Internet Censorship in Thailand to Blame

Internet Censorship in Thailand
U.S. resident, Joe Gordon, was arrested and jailed for online defamation in Thailand.

This one comes to you from the “WTH Files” and Internet censorship in Thailand is the topic at hand…

If you’ve ever seen “Broke Down Palace” or are on team-Schapelle-Corby, then you know how easy it can be for unsuspecting westerners to find themselves in an unfamiliar (and often unforgiving) Thai prison.  Traditionally, drugs are to blame when the unlucky land behind Bangkok bars; but this time around, a U.S.-based blogger, Joe Gordon, awakened the ire of the Thai government and is now doing hard time in Thailand.

Internet Censorship in Thailand: Joe Gordon, Defendant

Fifty-four years ago, Joe Gordon (Thai name: Lerpong Wichaicomma) was born in northeastern Thailand. But for about the past 30 years, Joe has been a legal resident of the United States.

This past May, when back in Thailand visiting his place of birth, Joe was arrested by Thai officials. Unlike many western adventurers who, when traveling, find themselves on the wrong side of Thai law, Mr. Gordon’s detainment didn’t deal with drugs or prostitution; instead he was essentially booked for defaming the Thai King on the Internet.

And believe you me, in Thailand, online lese-majeste offenses are taken seriously – so seriously that offenders can be locked up for five plus years!

Internet Censorship in Thailand: King Rama IX, Et Al., Offended Parties

What’s all this lese-majeste stuff about, you ask?

In 2008, lese-majeste  (public criticism of a ruling monarchy) regulations were enthusiastically embraced by the Thai government, which invigorated the island nation’s Internet censorship efforts.

Currently, the Royal Thai Police, Communications Authority of Thailand, and the Ministry of Information and Communication Technology (MICT) all monitor online activity concerning pornography, Thai royals, and government officials. And while an official blocked IP-Address list is made available to the public, reports indicate that a list of criteria by which websites are judged is not as readily available.

Who is Thailand’s Lese-Majeste-Fighting Monarch?

Meet Bhumibol Adulyadej, aka “King Rama IX,” or simply “Lek” to his close friends and family.

Some interesting Jeopardy facts about King Bhumibol: he’s the world’s wealthiest monarch (with an impressive financial portfolio estimated at 30 billion), he’s been on the Thai throne since 1946 and he’s generally well-loved by his subjects. Interestingly enough, for the past two years, King Rama IX has been confined to a hospital bed – but his longstanding illness sure isn’t affecting his battle against alleged online defamation.

Internet Censorship in Thailand: Joe Gordon Trial and Verdict

What, exactly, was the Internet act that landed Joe Gordon in a steaming pile of defamation, you ask?

Gordon posted several excerpts from Paul M. Handley’s book, “The King Never Smiles” on the Internet. Handley’s manuscript is one which Thai censorship watchdogs deem critical of King Rama IX, and therefore posting translations of it on the Net is illegal in Thailand.

In any event, back to Gordon. Thai censorship workers made note of the online defamation infringement, and when Gordon traveled to Thailand for a visit this past May, cops were waiting to make an arrest.

At first, Gordon denied the charges. But after several months of protesting, the US-national plead guilty.

Arnon Nampa, Gordon’s lawyer, explained the decision matter-of-factly: “We all have to choose between the rule of law or freedom.” Nampa went on to explain that his client eventually realized that no matter what, fighting the case would have automatically landed him another year in jail without bail – and jail time is something Gordon is trying to reduce at all costs.

Internet Censorship Lawsuit Sentencing

Last Thursday, Gordon was sentenced to two years in jail. Presiding Thai judge, Tawan Rodcharoen, explained that if it hadn’t been for Gordon’s guilty plea, it would have been a five-year sentence.

Elizabeth Pratt, consul general of the U.S. Embassy, called the verdict “troubling” and voiced concern about the severity of the sentence. In a statement published by the NYT, Pratt was sure to mention her “full respect for the [Thai] monarchy,” before concluding that “freedom of expression,” is an “internationally recognized human right.”

According to the same article, Gordon has applied for a royal pardon, and as a result, can’t speak much about his Internet censorship lawsuit with reporters.

Do you need legal assistance or a professional opinion with an Internet censorship issue? If yes, contact Kelly Law today. To keep up with the latest in Internet censorship news, sign up for our newsletter.

Get Ready For The New FTC Business Opportunity Rules

Well, it’s official. On March 1, 2012 the Federal Trade Commission’s new “Disclosure Requirements and Prohibitions Concerning Business Opportunities” or “business opportunity rules” go into effect. According to the FTC’s website, amendments to the original rules were done to “broaden the scope” of businesses to include “sellers of work-at-home opportunities.” The new guidelines stipulate three disclosure and sales obligations that “bizopp” marketers must follow.

Advocates for the new business opportunity rules say it’ll reduce costs, simplify the compliance process, and allow for greater transparency. But of course, there are at least two sides to every story; so while some may be lauding the new FTC business rules, others are most certainly grumbling.

Who The New FTC Business Opportunity Rules Affect

What exactly is a “business opportunity” you ask? They’re turn-key, packaged business investments. Unlike franchises, business opportunity buyers and sellers don’t maintain a professional relationship after the sale. Vending machines, rack routes, work-at-home craft assembly, envelope stuffing services and a slew of various Internet work-at-home opportunities are the types of things the FTC considers being “business opportunities.” Specifically, the new rules target business opportunity promotional materials that expressly state or imply that buyers will:

(1) Have help setting up or running a business;

(2) Be provided locations for equipment and displays;

(3) Be given outlets, accounts and customers as part of the package; or

(4) Have the ability to sell their products back to the seller.

While the above list is not exhaustive by any means, it serves to illustrate that the FTC is concentrating on making business opportunity sale claims more transparent by requiring substantiating evidence to back up marketing materials. If you run a multi-level marketing company or a franchise, then the new FTC business opportunity rules don’t apply to you[1]. Officials explained that Franchises have their own set of regulations and MLM issues are still best dealt with under section 5 of the FTC Act, which governs unfair and deceptive interstate commerce.

FTC Business Opportunity Rule Obligation #1: One-Page Disclosure

The crux of the new FTC business opportunity rule is the one-page disclosure requirement. Any person who sells a bizopp, regardless if they make earnings claims in their marketing material or not, must present all buyers with a document that includes the following information:

  • Company name, address, phone;
  • Name of bizopp sales person;
  • Date prospective buyer was given disclosure statement;
  • Disclosure statement if you or any associated bizopp affiliate have ever been the subject of a legal action for misrepresentation, fraud, securities law violations, or deceptive practices in the past 10 years.
  • Clear explanation of all policies related to refunds or cancellations.
  • List of references including name, state and phone number of everyone who’s bought the bizopp in the past three years. If more than 10 people have purchased the business opportunity, you can choose the 10 people closest by location to the prospective buyer. In addition, someone where on the disclosure statement, the statement: “If you buy a business opportunity from the seller, your contact information can be disclosed in the future to other buyers” must be conspicuous.
  • The seller must sign a copy of the statement and return it to the seller, who then must keep the paperwork on file.

Other things to note about the FTC business opportunity rules are that you must have a one-page disclosure statement for every language in which you market your product.

FTC Business Opportunity Rule Obligation #2: Earnings Claim Statement

Materials related to all three FTC business opportunity obligations must be kept for three years. In addition, bizopp sellers must update their disclosure information every quarter.

If you make earnings claims in your business opportunity marketing material, you must attach an earnings claim statement to the one-page disclosure described above. It must include:

  • The following statement in “big letters” across the top of the page: “Earnings Claim Statement Required By Law.”
  • Name of the person making the claim;
  • Start and end dates of the claim;
  • Number and percentage of buyers who’ve experienced at least the claimed amount of earnings;
  • Any information about buyers that may vary from prospective buyers that could have an effect on earning potential – like location;
  • Statement explaining how buyers can obtain proof of earnings claims; and
  • If your claims focus on industry-wide performance trends, you must have evidence showing how your offer is at least as good, or better, than the industry benchmarks.

Essentially, the earnings claim statement requirement for the new FTC business rules can be broken down into one simple sentence: If you make any earnings claims, you better have the material to back it up clearly and conspicuously.

FTC Business Opportunity Rule Obligation #3: Be Truthful & Other Miscellaneous Don’ts

The third obligation of the new FTC business rules is straightforward: Don’t do anything that’s already prohibited, and make sure you don’t have conflicting information across your one-page disclosure statement, earnings statement, or supporting material. Other “don’ts” include:

  • Don’t lie.
  • Don’t tell people they’ll have exclusive territories if they won’t.
  • Don’t embellish the likelihood of getting clients.
  • Don’t keep secret a relationship—whether familial, friendly or business-related—you may have with any person highlighted in your marketing material as having had great success with the given bizopp.
  • Don’t tell people you’re offering them a job if you’re really selling them a business.

What Should You Do If The New FTC Business Rules Will Affect Your Business

While there are upsides to the new FTC business opportunity rules, it will be interesting to watch how the regulations affect various bizopp affiliate marketing businesses down the line. If you operate a bizopp and maintain an online presence, you may want to contact an Internet lawyer who can audit your site and make sure you’re in compliance with the new regulations. Furthermore, if you do make earnings claims in your marketing material, it’s wise to have a lawyer well-versed in affiliate marketing law draft the required earnings statement.

Do you need legal assistance or advice about the new FTC business opportunities rule? Contact the Kelly Law Firm today.


Sniegowski, Don (11/22/2011). FTC Issues Final Business Opportunity Rule. Retrieved from on 12/5/2011.

Medical Justice FTC Investigation Is A Go

Medical Justice Copyright Contract
Will Medical Justice Feel The Wrath of The FTC?

After several months of bad press and legal leg-work, the Center for Democracy and Technology filed a formal complaint with the Federal Trade Commission and several Attorneys General over Medical Justice, a doctors’ rights company. In a thorough claim, the CDT cogently outlines what they consider deceptive and unfair practices on the part of Medical Justice.[1]

About The Medical Justice Copyright Infringement Control Business Plan

Over 3,000 medical professionals in the United States (many of which are allegedly facing malpractice suits[2]) pay approximately $1,200 a year for membership in Medical Justice, a company whose stated goal is to help doctors combat “physician Internet libel and web defamation.”[3]

The original Medical Justice modus operandi involved a contract that forbade patients to post negative online reviews about doctors or medical treatments received under the care of a practice. Since then, the contract has been tweaked. Now, instead of asking patients to relinquish their free speech rights, the Medical Justice agreement transfers the copyright of any future online review of the doctor, from the patient to the doctor. That way, in the event a negative review pops online, the doctor can simply exercise their copyright rights and have it removed[4] – convenient for the doctor, but legally sketchy.

Medical Justice FTC Investigation: Free Speech Legalities

The Medical Justice contract has changed since its inception since the first iteration was an affront to free speech rights.

And while contracts are binding, they become unenforceable if the law is ignored. And in the U.S., if trade secrets or confidential information are not involved, denying a citizen free speech rights, especially in a public interest matter (in this case, public health), is not allowed.

Medical Justice FTC Investigation: Privacy Legalities

Pro-Medical Justice spokespeople insist that medical professionals need service like Medical Justice since doctors are bound to patient confidentiality, and therefore can’t respond to spurious online claims.

But is that the whole truth?

While it’s true that doctors’ cannot discuss patients’ cases publicly, a doctor can discuss, online, how their practice is run (without mentioning a specific patient). Moreover, doctors can always sue patients for defamation if their reputations have been tarnished by slander or libel.

In addition to arguably misleading claims about doctor-patient confidentiality standards, Medical Justice has to worry about privacy rights. Some Medical Justice marketing collateral states that patients receive “more privacy protections” by agreeing to the contract. The problem is that Title 45 §164.508 of the federal HIPPA statute states that “a covered entity may not use or disclose protected health information without an authorization” from the patient. As such, it could be argued that Medical Justice’s claim of increased privacy standards is misleading, and or “deceptive.”[6]

Medical Justice FTC Investigation: Ghost Review Issues

Six months ago, published an investigative piece about speculation that Medical Justice was posting questionable Internet testimonials on behalf of their member doctors. As explained, eyebrows first started rising after John Swapceinski – webmaster of – reported that 86 reviews were collectively submitted through six Medical Justice IP addresses, between November 2010 and March 2011. Medical Justice CEO, Jeffrey Segal, explained away the coincidence as a result of a trial “Review Builder Program,” in which patients could fill out paper reviews in the waiting room, which Medical Justice would then transfer online.[5]

While the facts did check out about the existence of the Review Builder Program, Medical Justice would not put the Ars Technica journalists in touch with any of the people whose names appeared in the online reviews. To make matters even shadier, identical reviews appeared across several websites under different names. And lastly, all the Medical Justice patient reviews in questions were all positive, with top marks given across the board at varying websites – a coincidence the average person would most likely find highly suspect.

FTC Endorsement Guidelines: Good But Not Great

The ever-changing nature of the Internet means comprehensive FTC endorsement guidelines written just three years ago are already in need of updates. Can doctors’ cherry pick what reviews and testimonials to highlight on their websites? Is it legal to offer discounts in exchange for a Facebook “like”? These and other Internet-related legal questions still remain untouched on the legal books. But it’s possible that an FTC investigation and subsequent ruling in the Medical Justice case may begin to answer a few.

Sign up for the Kelly Law Firm newsletter to keep up with the latest news about the Medical Justice FTC investigation and all the latest Internet law-related happenings.


[1] Complaint and Request for Investigation, Injunction, and Other Relief. Retrieved from on 12/5/2011.

[2] Mullin, Joe (4/14/2011). Can Doctors Use Copyright Law To Get Rid Of Negative Reviews?. Retrieved from on 12/5/2011.

[3] About Medical Justice. Retrieved from on 12/5/2011.

[4] Anderson, Nate. (June 2011). Medical Justice caught impersonating happy patients on Yelp, RateMDs. Retrieved from on 12/7/2011.

[5] Lee, Timothy B. (June 2011). Medical Justice caught impersonating happy patients on Yelp, RateMDs. Retrieved from on 12/7/2011.

[6] Medical Justice Myths. Retrieved from on 12/5/2011.

FDA Rules HCG Weight Loss Products Are Ineffective & Misleading

HCG Illegal FDA Announcement
The FDA Decided That certain Weight Loss Products Are Illegal.

The Federal Drug Administration announced that HCG Weight Loss products are illegal. Eleven specific products were named in the statement, all of which were labeled “homeopathic” and received letters from the FDA informing them of their products perceived illegality.

The FDA’s Claims About HCG Weight Loss Products

Spokespeople for the Federal Drug Administration announced that products containing human chorionic gonadotropin are not effective weight loss supplements. The FDA cautions that taking HCG on a minimal calorie diet is very dangerous and increases one’s risk of a heart arrhythmia. Electrolyte imbalance and the development of gallstones are two other side effects the FDA is now linking with HCG weight loss products.

What Happens Next With HCG Weight Loss Products?

According to the FDA, all HCG brands who received FDA notices have fifteen days to develop a corrective actions plan. If they fail to do so, the FDA can either seize aspects of their business to halt the sales, or start criminal proceedings.

Are you an affiliate marketer in the HCG weight loss niche looking for options or legal advice? Kelly / Warner has several affiliate marketing lawyers to help you navigate your next legal step.

United States Copyright Law: Short, Sweet & Accurate Explanation

U.S. copyright law explanation

U.S. copyright law is dense, but below is brief guide meant to provide a general overview.

Anyone who creates an original work (e.g., a piece of writing, music, physical art, architectural work, etc.) is entitled to copyrights on that creation. A copyright is a legal guarantee which confers exclusive rights to the creator of an original work.

Under copyright laws, the creator of an original work is given the right to:

  • copy and reproduce their own work,
  • be credited for its use,
  • perform the work in a public setting, and
  • restrict unauthorized use of the original work.

As an intellectual property right, a copyright is similar to a trademark or patent and can be applied to any substantive form of information.

Copyright Law: Infringement

Copyright infringement is when a third party reproduces — and profits off of — a copyrighted work. Even if the work is not copied identically, copyright infringement penalties may still apply.

For example, let’s say that  song A samples recognizable parts of song B; if the proper usage licenses are not obtained for authorized use, the producers of song A can be hit with a copyright infringement claim.

Copyright Law: Transference

Copyright holders can sell or assign their rights to another person or company. If there exists express consent from the creator of the original work, usage of the work by the authorized party is not an occurrence of copyright infringement.

Copyright Law: Duplication Rights

As the holder of the copyright, the person or company may reproduce or duplicate a work in any fashion, for personal and commercial purposes. Owner also has the right to distribute the copyrighted work however they see fit – whether by putting it on sale to the public, leasing it or even lending it to someone else temporarily.

If copyright holders wish to create derivative works from the original work, they have that exclusive right as well. For example, a film studio may not create a movie based on a book without the book author’s express permission. In the example of music, musicians or producers may create a remix of their own original pieces, while remixes created by someone else would be considered copyright infringement.

Copyright Law: Performance Rights

Copyright holders have the exclusive right to display copies of their works in public, on the Internet, ins movie or by any other means. They also have a right to public performance. However, copyrights expire after a certain amount of time, so holding a copyright to an original work does not guarantee that the work will never be reproduced or distributed by anyone else. There are additional exceptions for fair use.

Copyright Law: Fair Use Doctrine

The Fair Use doctrine allows reproduction of copyrighted works for certain, specific purposes, such as for reviews, satire and teaching. This allows schools to study literary works, movie critics to publish reviews and television shows to use clips of news broadcasts from other channels.
If you are a creator of an original work, your work is copyrighted at the moment it is created. However, to reduce the chances of copyright infringement, you should register your creation at the United States Copyright Office, as you can’t exercise infringement proceedings if you haven’t registered your copyright. To find out more about your online copyrights, contact a copyright law attorney.

Free Speech Implications of Blocking Blog Posts in India

India’s got some new, draconian Interne law rules. Netizens and human rights advocates are slamming it as an attack on free speech.

India’s Free Speech-Unfriendly Blog Laws

Under the new guidelines, anyone — private citizen or political party — can request bans on websites that contain “objectionable material”. The criteria for objectionable content include, but are not limited to:

  1. Threats to the sovereign integrity of India,
  2. The security of the state,
  3. Friendly relations with foreign states, and
  4. Public order.

Sweeping Law Language Leads to Free Speech Infringement Fears

In theory, the move seems justified, but actual practice unearths many of its problems. For starters, objectionable content is 100% subjective, which means it can be used to censor or prohibit topics. The move also severely limits bloggers’ ability to post unpopular opinions, or to jump start a good debate.

Worse, web content is often taken down without any explanation, leaving site owners with no recourse to defend themselves, or gain third party adjudication for their case. Social networking sites like Facebook or YouTube, for example, must take down what Indian law has declared unfit for web surfers within 36 hours — and the web content owner can’t appeal.

Looking For A Video Game Lawyer?

video game lawyer Aaron KellyNeed a video game lawyer? Well, you’ve landed in the right place.

What Is Video Game Law?

Video game law is mainly concerned with issues related to intellectual property, contracts, privacy, security and licensing.

A Few Tips From A Video Game Lawyer

  • Documenting every aspect of video game development is crucial. Good documentation is the key to avoiding costly and damaging legal issues in the future.
  • What is your company’s relationship with the voiceover talents? Did you make it clear that they have no ownership interest in the finished product? If your relationship with this artist is not in writing, you do not have a clear relationship with her.
  • What about the angel investors who provided the funding for your company’s startup? Does they own stakes in each game you produce, or was the money simply a loan that you will repay once you start making a profit?

Get In Touch Today

The right video game lawyer can help you undo the legal messes of the past and tie up loose ends that could cost you money.