In today’s digital age, the question isn’t whether there is open source software being used in a company’s products, but how it is being used and what license governs its use. Open source is ubiquitous.  Despite its widespread use over the past decade, the provisions of open source licenses have been interpreted by only a handful of U.S. and foreign courts.  Open source-related disputes do not usually reach court as open source advocacy groups that enforce open source license provisions often work out a resolution between the parties without litigation.

However, one recent open source dispute has reached the courthouse. As discussed below, a new case filed in California state court could test the enforcement of one of the most common family of open source licenses, the GNU General Public Licenses or “GPL.” If the plaintiff is successful, the case could have the effect of expanding enforcement of GPL licenses under the rubric of consumer protection and allow a broad range of parties to bring claims under the GPL as third party beneficiaries of those licenses.

Last week, the Software Freedom Conservancy, Inc. (“SFC”) filed a complaint against smart-TV manufacturer Vizio, Inc. (“Vizio”) alleging a failure to comply with the GNU General Public License Version 2 (“GPLv2”) and GNU Lesser General Public License Version 2.1 (“LGPL v2.1”) (collectively, the “GPL Licenses”).  SFC alleges that, over the last four years, Vizio distributed smart TVs that included executable versions of Vizio’s “SmartCast code.  The SmartCast code, it alleged,  contained modifications to the Linux kernel and other code obtained by Vizio pursuant to the GPL Licenses.  SFC asserts that Vizio did not release the corresponding modified source code (as enhanced, modified or otherwise altered by Vizio) or accompany their smart TVs with a written offer to supply such code upon demand, as is required under the GPL Licenses. (Software Freedom Conservancy, Inc. v. Vizio, Inc., No. 30-2021-01226723 (Cal. Super. Orange Cty Filed Oct. 19, 2021)).

In the recent and significant Warren v DSG Retail Ltd [2021] EWHC 2168 (QB) decision the High Court in England clarified the limited circumstances in which claims for breach of confidence, misuse of private information and the tort of negligence might be advanced by individuals for compensation for distress relating…

UPDATE: On December 23, 2021, the parties reached a settlement, as Southwest filed an unopposed motion for entry of final judgment and a permanent injunction containing the same restrictions as the temporary injunction issued in September. Under the proposed permanent injunction, Kiwi would be barred from scraping flight and fare information from Southwest’s site, publishing any Southwest flight or fare information on kiwi’s site or app (or selling any Southwest flights), or otherwise using Southwest’s site for any commercial purpose or in a manner that violates Southwest’s site terms.

UPDATE: On November 1, 2021, the parties filed a Joint Notice of Settlement indicating that they have reached a settlement agreement in principle.  The terms of the settlement were not disclosed.

UPDATE: On October 28, 2021, the defendant Kiwi.com, Inc. filed a notice of appeal to the Fifth Circuit seeking review of the district court’s ruling granting Southwest Airlines Co.’s motion for a preliminary injunction.

On September 30, 2021, a Texas district court granted Southwest Airline Co.’s (“Southwest”) request for a preliminary injunction against online travel site Kiwi.com, Inc. (“Kiwi”), barring Kiwi from, among other things, scraping fare data from Southwest’s website and committing other acts that violate Southwest’s terms. (Southwest Airlines Co. v. Kiwi.com, Inc., No. 21-00098 (N.D. Tex. Sept. 30, 2021)). Southwest is no stranger in seeking and, in most cases, obtaining injunctive relief against businesses that have harvested its fare data without authorization – ranging as far back as the 2000s (See e.g., Southwest Airlines Co. v. BoardFirst, LLC, No. 06-0891 (N.D. Tex. Sept. 12, 2007) (a case cited in the current court opinion)), and as recently as two years ago, when we wrote about a 2019 settlement Southwest entered into with an online entity that scraped Southwest’s site and had offered a fare notification service, all contrary to Southwest’s terms.

In this case, the Texas court found that Southwest had established a likelihood of success on the merits of its breach of contract claim. Rejecting Kiwi’s arguments that it did not assent to Southwest’s terms, the court found that Kiwi had knowledge of and assented to the terms in multiple ways, including by agreeing to the terms when purchasing tickets on Southwest’s site. In all, the court found the existence of a valid contract and Kiwi’s likely breach of the terms, which prohibit scraping Southwest’s flight data and selling Southwest flights without authorization. The court also found that Southwest made a sufficient showing that Kiwi’s scraping and unauthorized sale of tickets, if not barred, would result in irreparable harm. In ultimately granting Southwest’s request for a preliminary injunction, the Texas court also found that Southwest also demonstrated the threatened injury if the injunction is denied outweighed any harm to Kiwi that will result if the injunction is granted and that the injunction would be in the public interest.

What made this result particularly notable is that the preliminary injunction is based on the likelihood of success on the merits of Southwest’s breach of contract claim and Kiwi’s alleged violation of Southwest’s site terms, as opposed to other recent scraping disputes which have centered around claims of unauthorized access under the federal Computer Fraud and Abuse Act (CFAA).

On September 14, 2021, the Securities and Exchange Commission (“SEC”) filed a settled securities fraud action against App Annie Inc., one of the largest sellers of market data on how apps on mobile devices are performing, and its co-founder and former CEO and Chairman Bertrand Schmitt.  The settlement is the…

On July 30, 2021, a New York district court declined to dismiss copyright infringement claims with respect to an online article that included an “embedded” video (i.e., shown via a link to a video hosted on another site).  The case involved a video hosted on a social media platform that made embedding available as a function of the platform.  The court ruled that the plaintiff-photographer plausibly alleged that the defendants’ “embed” may constitute copyright infringement and violate his display right in the copyrighted video, rejecting the defendants’ argument that embedding is not a “display” when the image at issue remains on a third-party’s server (Nicklen v. Sinclair Broadcast Group, Inc., No. 20-10300 (S.D.N.Y. July 30, 2021)).  Notably, this is the second New York court to decline to adopt the Ninth Circuit’s “server test” first adopted in the 2007 Perfect 10 decision, which held that the infringement of the public display right in a photographic image depends, in part, on where the image was hosted.  With this being the latest New York court finding the server test inapt for an online infringement case outside of the search engine context (even if other meritorious defenses may exist), website publishers have received another stark reminder to reexamine inline linking practices.

On August 5, 2021, a proposed class action settlement was reached in the closely-watched privacy action against fintech services company Plaid Inc. (“Plaid”).  The settlement features a $58 million settlement fund and certain injunctive relief that would make changes to Plaid’s methods of notice and consumer data collection, including provisions requiring the deletion of certain banking transaction data. (In re Plaid Inc. Privacy Litig., No. 20-3056 (N.D. Cal. Memorandum of Points for Proposed Settlement Aug. 5, 2021)). The settlement is still subject to court approval.

Plaid is a fintech services company that offers applications that provide account linking and verification services for various fintech apps that consumers use to send and receive money from their bank accounts.  The consolidated actions involve claims surrounding Plaid’s alleged collection and use of consumers’ banking login credentials and later processing and selling of such financial transaction data to third parties without adequate notice or consent.  Plaintiffs’ complaint also contended that at no time were users ever given conspicuous notice or meaningfully prompted to read through Plaid’s privacy policy indicating that Plaid receives and retains access to their financial institution account login credentials or uses their credentials to collect and sell their banking information.   As we wrote about back in May 2021, the California district court, in deciding Plaid’s motion to dismiss, trimmed various federal privacy-related claims, including the Computer Fraud and Abuse Act (CFAA) claim, but allowed other state law privacy claims to go forward.

In the past month, there have been some notable developments surrounding Section 230 of the Communications Decency Act (“CDA” or “Section 230”) beyond the ongoing debate in Congress over the potential for legislative reform. These include a novel application of CDA in a FCRA online privacy case (Henderson v. The Source for Public Data, No. 20-294 (E.D. Va. May 19, 2021)) and the denial of CDA immunity in another case involving an alleged design defect in a social media app (Lemmon v. Snap Inc., No. 20-55295 (9th Cir. May 4, 2021), as well as the uncertainties surrounding a new Florida law that attempts to regulate content moderation decisions and user policies of large online platforms.  

In a closely-watched appeal, the Supreme Court, in a 6-3 decision, reversed an Eleventh Circuit decision and adopted a narrow interpretation of “exceeds unauthorized access” under the Computer Fraud and Abuse Act (CFAA), ruling that an individual “exceeds authorized access” when he or she accesses a computer with authorization but then obtains information located in particular areas of the computer – such as files, folders, or databases – that are off limits to him or her. (Van Buren v. United States, No. 19-783, 593 U.S. ___ (June 3, 2021)). The majority equated “exceed[ing] authorized access” with the act of “entering a part of a system to which a computer user lacks access privileges,” rejecting the Government’s contention that a person who is authorized to access information from a protected computer for certain purposes violates CFAA Section 1030(a)(2) by accessing the computer with an improper purpose or motive. Put simply, the court’s view suggests a “gates-up-or-down” approach where the CFAA prohibits accessing data one is not authorized to access.

Although the case involved a criminal conviction under the CFAA, Van Buren gave the Supreme Court the opportunity to resolve a long-standing circuit split and heavily-litigated issue that arose in both criminal and civil cases under the CFAA’s “unauthorized access” provision. This provision of the CFAA is routinely pled in cases against former employees that have accessed proprietary data in their final days of employment for an improper purpose (e.g., for use in their new job or competing venture). It is also a common claim in disputes involving unwanted web scraping. On the latter point, the Court’s narrow interpretation of the “exceeds authorized access” provision would appear to be right in line with the narrow interpretations of the CFAA enunciated by the Ninth Circuit in its blockbuster hiQ opinion, which held that that when a computer network generally permits public access to its data, a user’s accessing that publicly available data will not constitute access “without authorization” under the CFAA and in its Power Ventures precedent, which held that, in the context of unwanted data scraping, a violation of the terms of use of a website, without more, cannot be the basis for civil liability under the CFAA.