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Saturday, April 16, 2011

Fourth Circuit's Turnitin.com Ruling Brings More Trouble for Plaintiffs

by Thomas O'Toole

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 The case of A.V. v. iParadigms LLC (lower court ruling here) had a lot of cyberlaw juice when a federal district court decided it last spring. Rulings on digital fair use, electronic contracting, and computer fraud were all in there -- arising from the defendant's turnitin.com plagiarism detection service. Turnitin.com, operated by defendant iParadigms LLC, works like this: students are forced by their teachers to electronically file their written work with the turnitin.com Web site (but not before assenting to an onerous e-contract). Turnitin.com then compares the newly submitted work against its database of existing student work, delivering to its educational institution customers an assessment whether the new work is the result of plagiarism.

So there you have it. Was turnitin.com making a fair use of the student's work? Was the e-contract that the students assented to a valid one? The lower court answered "yes" to both of these questions.

Today the Fourth Circuit issued its opinion, affirming the lower court in a ruling that I am sure will be cheered by digital fair use proponents. The court stepped through the fair use analysis, dropping positive notes here (commercial uses can be fair uses), here (a use can be transformative "in function or purpose without altering or actually adding to the original work," citing Perfect 10 Inc. v. Amazon.com Inc.), and here (fact that turnitin.com used the entirety of the plaintiff's work did not preclude finding of fair use). And it turned back a lot of other, small-bore challenges to the district court's fair use finding. The court said it didn't need to address the plaintiff's challenge to the click contract in view of its ruling on the fair use question.

The part of the opinion that caught my attention was the court's treatment of iParadigm's counterclaim under the Computer Fraud and Abuse Act, 18 U.S.C. 1030. The district court threw the counterclaim out, ruling that iParadigms had not alleged a cognizable loss. The Fourth Circuit reversed that ruling here, in a manner that could leave Web users open to getting smacked with a large CFAA award whenever a company suspects someone has gained improper access to its Web site.

iParadigm alleged that the plaintiff made an unauthorized access to the turnitin.com Web site by using a password issued to someone else. The Fourth Circuit described iParadigm's evidence like this:

    iParadigms offered evidence that when it learned that A.V. was able to register and submit papers as a student of a university in which he was     not enrolled and had never attended, it feared the possibility of a technical glitch in the Turnitin system and concluded an investigation was     necessary. Unaware that A.V. had simply obtained a password posted on the Internet, iParadigms assigned several employees to determine     what happened. According to iParadigms, over the course of about one week, numerous man-hours were spent responding to A.V.’s use of the     UCSD password.

This looks like a pretty thin CFAA claim. No damage, no loss. "Fears" regarding a "technical glitch." Imagine Chicken Little submitting a Gartner invoice for time spent tracking down the source of that acorn.

Anyhow ... the Fourth Circuit ruled that these allegations of "loss" were good enough to survive summary dismissal and it remanded the case to the trial court for another look at iParadigm's loss claims. Other courts have ruled similarly. Costs incurred investigating and taking remedial steps following a computer intrusion are recoverable under the CFAA. The court here cited Modis Inc. v. Bardelli, 531 F. Supp. 2d 314 (D. Conn. 2008), and SuccessFactors Inc. v. Softscape Inc., 544 F. Supp. 2d 975 (N.D. Cal. 2008). It could have cited Nexans Wires v. Sark-USA Inc., a leading ruling from the Second Circuit in this area.

I hope the trial court on remand will take the opportunity to discuss what is reasonable as far as investigative and remedial costs for a post-intrusion investigation. I just looked around a bit, and couldn't find any decisions on this point. If mere fear about the possibility of a technical glitch can put a defendant on hook for a week's worth of technical assistance, CFAA claims will become even more attractive. But I'm not saying the sky is falling. I wouldn't do that.
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