Below is a summary of a recent development that may be of
interest from our Technology, Media & Telecommunications (TMT)
practice Group. Our TMT, Regulatory and Securities Litigation
Groups have been working closely with our Hedge Fund Group in
counseling hedge fund managers with respect to the complex
regulatory, compliance and contractual issues raised by their data
aggregation, web scraping and other data science methods and
practices (both internally developed and externally sourced).
From Proskauer's New Media and Technology Law Blog:
For years, craigslist has aggressively used technological and
legal methods to prevent unauthorized parties from scraping,
linking to, or accessing user postings for their own commercial
purposes. In its latest judicial victory, on April 13, 2017,
craigslist obtained a $60.5 million judgment against Radpad, Inc.,
on various claims relating to harvesting content from
craigslist's site and sending unsolicited commercial emails to
craigslist users. (Craigslist, Inc. v. RadPad, Inc., No.
16-01856 (N.D. Cal. Apr. 13, 2017)).
This judgment relates to an earlier Craigslist case against another aggregator. In that case, the
aggregator was scraping craigslist content (despite having received
a cease and desist letter informing it that it was no long
permitted to access the site) and offering the data to outside
developers through an API. (See generally Craigslist, Inc. v. 3Taps, Inc., 2013
WL 1819999 (N.D. Cal. Apr. 30, 2013)). In 2015, craigslist settled
the 3Taps lawsuit, with relief against various defendants
that included monetary payments and a permanent injunction barring
unauthorized access to craigslist content and to circumvent any
technological blocks against spidering or scraping activities.
Last year, however,
craigslist revived the 3Taps dispute when it filed a
complaint against the real estate listing site RadPad, an
entity that had allegedly received scraped craigslist data from
3Taps before the 3Taps case was settled. In its complaint, craigslist claimed that after the
3Taps litigation was settled, RadPad and its agents began their own
independent efforts to scrape craigslist site, despite receiving a
cease and desist letter from craigslist barring Radpad from using
the craigslist site. Craigslist alleged that RadPad used
sophisticated techniques to evade detection and scrape thousands of
user postings and thereafter harvested users' contact
information to send spam in an effort to entice users to switch to
RadPad's services. (See Craigslist, Inc. v. RadPad, Inc., No.
16-1856 (N.D. Cal. filed Apr. 8, 2016)). In its complaint seeking
compensatory damages and injunctive relief, craigslist brought
several causes of action, including breach of contract, CAN-SPAM,
Computer Fraud and Abuse Act (and California state law equivalent),
and copyright infringement.
During the course of the litigation, Radpad became insolvent and
its attorney withdrew from representation, essentially allowing
craigslist to obtain what amounts to a default judgment.
The relief included:
Copyright: $20.4 million for
copyright infringement based on RadPad's scraping of various
user postings from craigslist's site. Interestingly, in order
to have standing to bring infringement claims against certain
aggregators such as 3Taps, craigslist changed its terms of service
for a limited time to gain an exclusive assignment of copyright
rights to user content.
Breach of contract: $160,000 for
CAN-SPAM: $40 million, based upon
violations from 400,000 emails. Notably, the court stated that
Radpad had violated CAN-SPAM by sending emails that, among other
things, contained false and misleading header information and
subject lines and were sent through a whitelisted third party email
delivery service to bypass craigslist's spam filters.
Injunctive relief: Radpad and its employees and agents are
enjoined from accessing or distributing any user content on
craigslist, as well as barred from sending any commercial email to
any craigslist user in violation of CAN-SPAM, among other things.
Radpad is also prohibited from using technological means to scrape
craigslist's site or circumvent any of craigslist's access
controls (e.g., IP address blocks), or from purchasing or
harvesting craigslist user postings.
While it is doubtful that craigslist will ever collect its
sizeable judgment, it will certainly hold the specter of such a
large monetary award as an example of the potential consequences of
engaging in unauthorized commercial scraping or spidering
will continue to watch this case and similar data scraping disputes
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