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Netflix did not violate ADA because websites are not public accommodations under Ninth Circuit law — Cullen v. Netflix, Inc., 2012 WL 2906245 (N.D. Cal. July 13, 2012)

Several weeks ago,  I posted a blog entry about a Massachusetts case holding that Netflix violated the Americans With Disabilities Act (ADA) by failing to close-caption all of its streamed video content.  A California federal court recently ruled the opposite way.

As in the Massachusetts case, Cullen is based on the limited availability of closed-caption content in Netflix’s streaming library.  Cullen, the plaintiff, alleged in his class action lawsuit that Netflix failed to make good on promises to expand the number of closed-captioned titles it would offer to subscribers of its streaming service.  Cullen originally included an ADA claim in his lawsuit, but dropped the claim after being assured by the National Association of the Deaf and the Civil Rights Division of the Department of Justice that the ADA claim would be pursued in a separate case (i.e., the Massachusetts case that I previously blogged about).  Instead, the ADA issue comes up in a roundabout way–Cullen asserted a claim for violation of California’s Unruh Civil Rights Act.  The claim was based in part on ADA violations because a violation of the ADA is by definition a violation of the Unruh Act.  The court therefore analyzed whether the ADA was violated.

The court took note of the recent Massachusetts decision.  However, under Ninth Circuit law, a “place of public accommodation” under the ADA is limited to “an actual physical place.”   The court cites a string of precedent flowing from the Ninth Circuit’s decision in Weyer v. Twentieth Century Fox Film Corp., 198 F.3d 1104 (9th Cir. 2000), holding that websites are not places of public accommodations under the ADA because they are not actual physical places.  Based on those cases, the court ruled that the Netflix website is not a place of public accommodation.  That meant that Cullen’s Unruh Act claim did not survive to the extent it relied on violations of the ADA.

Cullen also alleged violations of the Unruh Act independent of the ADA, as well as violations of other California statutes, but none of them fared well.  The court granted Netflix’s motion dismiss but gave Cullen a chance to amend his complaint.

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Judge allows disability civil rights claim against Netflix to proceed — National Association of the Deaf v. Netflix, Inc., 2012 WL 2343666 (D. Mass. June 19, 2012)

Whoa, talk about floodgates.  If this case gets upheld on appeal, it might let loose a new wave of American With Disabilities Act (ADA) litigation.  Two groups advocating for the rights of the deaf and hearing impaired sued Netflix under the ADA for failing to provide equal access to its video streaming web site.  Now, live video streaming is critical to Netflix’s business model, so the ruling is certainly a blow to Netflix.  But the ruling has far greater implications.  The basic question is whether websites are “public accommodations” to which the anti-discrimination provisions of the ADA.  The federal district court of Massachusetts said yes.

The ruling was handed down in the context of Netflix’s motion for judgment on the pleadings, which is an attempt to end the case at an early stage.  Netflix argued that websites are not in the list of public accommodations in the ADA statute.  The court rejected the argument, noting that while web-based services are not specifically listed in the statute as public accommodations, Congress intended the ADA to adapt to changes in technology.  Moreover, the streaming video website fell into one or more of the listed ADA categories of public accommodations, including a “place of exhibition or entertainment” and a “rental establishment.”  But the streaming service is different from a bricks-and-mortar establishment, Netflix argued, because the videos are accessed in private residences, not in public spaces.  No matter, said the court.  The ADA covers the services “of” a public accommodation, not services “at” or “in” one.  Many businesses provide services to a customer’s home (plumbers, pizza delivery services, and moving companies are the ones listed in the court opinion) and they are not necessarily exempt from the ADA.

Netflix made two additional arguments relating to captioning.  First, Netflix argued that the plaintiffs failed to allege that Netflix controls the captioning of streaming video content.  According to Netflix, owners of video programming (not distributors like Netflix) hold the exclusive copyrights necessary to caption content.  Without the copyrights, Netflix cannot caption content without the permission of the copyright owners.  The court rejected this argument because Netflix alleged that it is working to provide captioning for the content on its streaming service.  This suggests that Netflix has some degree of control over the captioning of its video streams.

Netflix’s second captioning argument was that interpreting the ADA to cover the captioning of video programming would create an irreconcilable conflict with the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA), which regulates the closed captioning of online video content.  This argument did not persuade the court either, as it found that the CVAA did not conflict with ADA even if the latter imposes broader duties on Netflix than the CVAA; it was possible to comply with both laws.

LegalTXT Lesson: Netflix likely will appeal to the First Circuit, and with good reason.  Small business owners are familiar with the rash of lawsuits spawned by the ADA.  If it stands, this ruling exposes a whole new class of businesses to ADA claims.  Many web-based services could be potential targets of ADA lawsuits.  For instance, could a restaurant that allows customers to make reservations online be sued under the ADA if it doesn’t close-caption its website?  Would a hotel booking website violate the ADA by failing to provide a voice activation feature on its site?  It all remains to be seen.  Stay tuned.

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ICANN not a “domain name authority” under ACPA; no in rem jurisdiction in district where ICANN is based — Vizer v. Vizernews.com, 2012 WL 2367130 (D.D.C. June 22, 2012)

First off, my apologies for writing two consecutive posts with headlines that play off the word “can’t.”  Now on to more serious matters…

This case scuttles one way of getting a quick default judgment against a cybersquatter who is nowhere to be found.  The plaintiff (Vizer) wanted to bring a cybersquatting suit against the registrant of a domain name that contained his last name and was linked to a website dedicated to providing news about him (Vizernews.com).  Vizer couldn’t identify the registrant of the domain name; the domain was registered anonymously and the registrant used a privacy service to hide its contact information.  Vizer therefore brought an in rem action under the Anti-Cybersquatting Consumer Protection Act (ACPA).  Vizer is correct that the ACPA allows a trademark owner to file an in rem civil action against a domain name in the judicial district in which the “domain name registrar, domain name registry, or other domain name authority is located.”  The issue is, did Vizer file in the correct judicial district?

Vizer filed the in rem action in Washington, D.C. on the theory that the Internet Corporation for Assigned Names and Numbers (ICANN) maintains an office there.  The court dismissed the case because ICANN didn’t fit into any category of entities who can be sued in rem under the ACPA.  ICANN is not the domain name registrar (in this case, Melbourne IT, LTD d/b/a Internet Names Worldwide) nor the registry (in this case, VeriSign, Inc.).  Vizer argued that ICANN is a “domain name authority,” but the court rejected that suggestion.  According to the court, the term “domain name authority” refers to an entity that has some authority over the domain name, i.e., it plays a role in registering or assigning domain names.  ICANN doesn’t do either of those things.  Although ICANN coordinates the global domain name system, it doesn’t actually assign specific domain names or maintain a registry of such names.  The court also found persuasive legislative history of the ACPA stating that the in rem provision was not meant to cover ICANN.

LegalTXT Lesson: It looks like Vizer’s attorneys did their homework before going the in rem route.  I’m not sure what they could’ve done differently, except one wonders why they didn’t file in where the registrar (VeriSign) is located.  Verisign is based in Reston, Virginia, just a short distance far from D.C.

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Only owner of a mark can sue for cybersquatting — Garruto v. Longo, 2012 WL 1981838 (D.N.J. June 1, 2012)

Say a disgruntled customer of your business decides to complain to the world about how dissatisfied he is with the product you sold him.  He writes scathing online reviews.  He even goes so far as to register a domain name that includes part of your company’s name.  What can you do?

At first glance, one solution might be to sue under the Anticybersquatting Consumer Protection Act (ACPA).  But not so fast.  First, you need to be the legal owner of the trademark that’s part of the offending domain name.  The plaintiff in Garruto v. Longo apparently overlooked that step.

A pet store (Fancy Pups, Inc.) sold a German Shepherd puppy to the defendant (Longo).  Immediately after the sale, the puppy contracted the parvo virus and died.  Longo claimed the puppy contracted the virus at Fancy Pups.  According to the complaint, Longo then “began an internet crusade to run Fancy Pups out of business.”   Longo allegedly posted photos of the dead puppy on the Internet, called the owner of Fancy Pups a “puppy killer,” and labeled Fancy Pups a “puppy mill.”  Longo voiced her complaints on online review websites like Yelp! and published advertisements in a local newspaper.  Longo also created a company profile for Fancy Pups on Manta.com.  In the profile heading “About Fancy Pups,” Longo stated: “We sell sick puppies at top dollar that will die.  I am an unscuplious [sic] man who will take your money and leave you with a dead dog.  I am evil LIAR.”

Fancy Pups and its owner sued Longo under the ACPA.  Notably missing in the complaint was an allegation that “Fancy Pups” was registered as a trademark by the plaintiffs or that it is a famous mark that everyone knows.  This omission proved fatal to the ACPA claim.  A cybersquatting claim must be brought by the “owner of a mark,” and the plaintiffs failed to establish that “Fancy Pups” was entitled to trademark protection.  The court also noted that there was no allegation that Longo registered a domain name that included “Fancy Pups.”  The court concluded without much discussion that posting a fake profile on an online business directory like Manta.com does not constitute cybersquatting.

LegalTXT Lesson: Register your trademarks.  The ACPA won’t help you if you can’t establish you own the marks you’re trying to protect.