The Law of Electronic Commerce and the Internet - Research Paper Example

Law of Electronic Commerce and the Internet Answer: 1 A number of particular issues arise in a consumer protection context in respect of online auctions.1 The first important point to note is the sheer frequency with which fraud occurs on online auction sites.2 In this matter, Mr. John will be liable for a mistake for not identifying in the terms and conditions of the online contract of eBuy Company. Online auctions have in recent years demonstrated themselves to be a popular forum for fraudulent activities. Sellers and Internet auction operators, including overseas based sellers and operators, need to be aware of their potential liability under the provisions of Part V of the Trade Practices Act 1974 (Cth) (“TPA”) and/or equivalent State and Territory Fair Trading legislation (for example, the Fair Trading Act 1987 (NSW)), where they sell or are involved in the sale of products to Australian consumers. Irrespective of the contractual arrangements between the parties, the misleading and deceptive conduct provisions of the TPA and/or equivalent Fair Trading legislation may well apply, provided a sufficient jurisdictional nexus is established in relation to the relevant conduct. However this is on a particular problems arose by eBuy and Mr. John Online auction transactions. In the case of a eBuy auction company has control over the goods that are being auctioned. In this case of auction, the buyers Mr. Paul paid $ 1500 the eBuy company for the goods Television. Misleading and deceptive conduct will extend to the layout of the site itself. In this regard factors such as the size, type and colour of the font, the prominence and location of hyperlinks, visibility and location of key terms and conditions, whether any distracting graphics or technology are used as well as other relevant circumstances, may be relevant to whether the Internet based conduct is misleading or deceptive. In this case, terms and conditions of the eBuy Company was not clear and the size was big so that customers clicking “I Accept” Button without reading and understanding the terms and conditions. And Mr. John was clicking “I Accept” Button without reading and understanding the terms and conditions. Mr. John’s claim would depend, essentially, on whether he could establish that he was led to believe that the auction site eBuy, through terms and conditions or through representations on the website, misled him as to the characteristics and security of the auction process. This issue was considered in the case of Evagora v eBay Australia & New Zealand Pty Limited  [2001] VCAT 49, although, being a Tribunal decision, its precedent value is limited. In that case, Evagora successfully bid for a computer in an eBay hosted auction, which was paid for but never arrived. The seller of the computer was based overseas. Evagora claimed for his loss against eBay, arguing that he did not read eBay’s user agreement, and that eBay represented that the auction site was safe, which overrode the terms of the user agreement. eBay was held liable by the Tribunal for the loss suffered by Evagora. It is important that the terms and conditions on which a consumer participates in Online auctions website are clear, accurate, and accessible to avoid potential claims under sections 52 and 53. It is also important not to reduce or nullify the effectiveness of any terms and conditions by contrary or inconsistent representations or impressions given to users via the actual content of the website. Answer 2 Harry's Burger Farm collects personal details from Paul. Two years later Paul is upset when his health insurer charges a higher health insurance premium because he is deemed a 'high risk’ heart attach candidate. Another insurer refuses to insure his car, citing high clash statistics for owners of mobile phones. According to the PPP 1.1, An organisation must not collect personal information unless the information is necessary for one or more of its functions or activities. But Harry's Burger Farm was collecting all personal details of Paul which were not necessary for the Farm. Therefore, section 14 & Principle 10 of the Privacy Act, 1988 determined the limits on use of personal information in that way, i.e., a record-keeper who has possession or control of a record that contains personal information that was obtained for a particular purpose shall not use the information for any other purpose unless: (a) the individual concerned has consented to use of the information for that other purpose; (b) the record-keeper believes on reasonable grounds that use of the information for that other purpose is necessary to prevent. or lessen a serious and imminent threat to the life or health of the individual concerned or another person; (c) use of the information for that other purpose is required or authorised by or under law; (d) use of the information for that other purpose is reasonably necessary for enforcement of the criminal law or of a law imposing a pecuniary penalty, or for the protection of the public revenue; or (e) the purpose for which the information is used is directly related to the purpose for which the information was obtained. In this case, Harry's Burger Farm has mishandled Paul’s personal information by violation of the PPP 10 and section 14 of the Privacy Act, 1988. Paul should try and work out the matter with the agency in question before making a complaint under section 36(1)1 of the Privacy Act to the Privacy Commissioner. The Privacy Act 1988 (Cth) gives Paul the right to make a complaint if Paul think personal information, including health information2 about Paul ('high risk’ heart attach candidate), has been mishandled by Harry's Burger Farm. Since Paul believe that his personal information has been mishandled by the Harry's Burger Farm, he would first raise the matter with the agency in question and give them 30 days to adequately deal with Paul’s complaint. If Paul receive no response or are not satisfied with the response provided, Paul can then lodge a complaint with the Office of the Privacy Commissioner, which may be able to investigate the matter. Answer: 3 If Paul’s ‘Heidi is dead’ company owns a trademark and find that the Cunning & Clever Pvt. Ltd. Company is holding it hostage as a domain name until Paul’s ‘Heidi is dead’ company pay $ 40000, a large sum, for it, Paul’s ‘Heidi is dead’ company may be the victim of Cybersquatting.3 This situation is called Cybersquatting, Paul’s ‘Heidi is dead’ company has been offered to buy domain name at high rate when his company has applied to the .com delivery for the domain name ‘heidisdead.com’. But the Cunning & Clever Pvt. Ltd., an Australian Company, has already registered this domain name. Since the Cunning & Clever Pvt. Ltd. is an Australian Company as Paul’s band company ‘Heid is dead’ will get remedy by the Trade Marks Act, the Trade Practices Act and the tort of passing off of Australia. In Australia, there is no legislation to protect against cybersquatting and none in the pipeline. The Trade Marks Act is of limited usefulness. The holder of a registered trademark can prevent anyone from infringing that mark, but only if it is being used in respect of goods or services that fit within a category within which the mark has been registered.4 Thus ‘the Trade Practices Act (TPA) is the best bet for the aggrieved cybersquattee. Section 52 prohibits misleading or deceptive conduct, and section 53 prohibits misrepresentations as to affiliations, approvals and endorsements. It is a breach of the TPA to represent that Paul’s company or products have a commercial connection with another company or its products if no such connection exists. The TPA is commonly used to prevent other businesses from trading under deceptively similar names.’5 However, ‘in respect of domain names, the situation is unclear. The TPA will clearly prevent a cybersquatter from using a domain name if its use will be likely to mislead or deceive consumers.’ For example, the Cunning & Clever Pvt. Ltd. will not be able to operate a web site for their band business with the domain name of Paul’s company ‘Heid is dead’ web page. But what if the Cunning & Clever Pvt. Ltd. registers heidisdead.com and uses it to promote their motorbike repair shop?, or, if the Cunning & Clever Pvt. Ltd. Company does not use it at all? Arguably, the TPA does not assist. It is hard to say that there can be any risk of confusion between motorbikes and Band Company. The existence of actual or likely deception is a critical element for establishing a breach of sections 52 or 53. The ‘Heidi is dead’ Company can either sue to get his domain name - and possibly some money damages -- under a 1999 federal law known as the Anti-Cybersquatting Consumer Protection Act, or ‘Heidi is dead’ Company can initiate arbitration proceedings under the authority of the Internet Corporation of Assigned Names and Numbers (ICANN) and win the name back without the expense and aggravation of a lawsuit. Answer: 4 Patent protection plays an increasingly important role with respect to computer program and for business methods. Patents Protection for Computer Programs For many years, up to the late 1980s, the Australian Patent Office (APO) routinely rejected patent applications involving computer software.6 A computer program may be patentable if it produces a commercially useful effect.7 The Australian Patent Office accepts that "any innovative idea which provides a practical solution to a technological problem" may be the subject of a patent.8 The question of whether computer software related inventions, such as methods of operating a known machine (the computer), abstract ideas, intellectual processes or mathematical or scientific algorithms, constitute a “manner of manufacture”, as required by the Patents Act 1990 and are therefore patentable subject matter, first came before an Australian court in 19929 and a patent was granted.10 As a result of these court decisions, IP Australia adopted a new practice which treated computer programs in the same way as other claims of innovation.11 The test is now whether or not the claimed invention produces a commercially useful effect. The Patent Office accepts that "any innovative idea which provides a practical solution to a technological problem" may be the subject of a patent. This approach was confirmed and accepted in a number of subsequent decisions.12 Patent protection is likely to augment copyright protection as a significant method of protection software. An advantage of the patent system is that it gives the owner a complete monopoly, even if another person has created something independently or by reverse engineering for the purposes of interoperability. However, the costs associated in going through the patent registration process may mean that the majority of software creators continue to rely on the automatic protection afforded by copyright as their main method of protection. Another factor deterring software developers from seeking patent protection is the publication process referred to above. The subject matter of a patent application is made available to the public and therefore anyone who wishes to misappropriate software the subject of a patent can simply obtain a copy of the patent specification and copy the code. To prevent this, the patentee would have to take patent infringement action, which can be very costly and time consuming.13 Patents Protection for Business Methods The World Trade Organization’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) does not specifically address business method patents. The United States, Australia, Japan and Singapore are considered "safe havens" for business method patents. There is no general prohibition on the patentability of business methods in Australia. Their patentability is determined by applying the tests used to determine the patentability of any type of invention. Essentially a patent may be granted for a business method where there is something artificially created to implement the method. That is, the implementation of a business method may require the interaction of a physical system or process with the method. There should also be sufficient detail given in the description about the specific operation of the system or process to implement the method. Any such business method must also be new and inventive.In a recent decision, Grant v Commissioner of Patents [2006] FCAFC 120, [47],14 the Full Court of the Federal Court of Australia held that a business method will only be patentable if it has a physical aspect, being a concrete, tangible, physical, or observable effect or phenomenon. Accordingly, 'pure' business methods, being those that do not have a physical aspect, are not patentable in Australia.15 Answer: 5 In recent years, privacy has been receiving increased attention both as a social item of discussion as well as an emerging area of law. While Australia has had privacy protections in respect of government activities and also for various specified industries for over two decades,16 recent developments in business and, in particular, technological advances have renewed focus on privacy as an issue. The increased interest in privacy is due in no small part to the exponential growth of the internet as a new method of obtaining information, communication and doing business.3. The ten National Privacy Principles in the federal Privacy Act protect your personal information and give you rights in the way private sector organizations. Many organisations and each Australian and ACT Government agency have publicly available information on how they handle your personal information. This information sets out the privacy practices and obligations of the organisation or agency you are dealing with. The information may be in a written document or you may be told in person or over the phone. This information generally sets out the law that the organisation is bound by, any exemptions that may apply and details for obtaining further information about the way the organisation manages the personal information it holds. Protecting your privacy online will ensure that you are not leaving your personal information open to abuse. Good computer security includes installing reputable anti-spyware, anti-virus scanners and firewalls software and ensuring they are all up to date. Also, make sure you are visiting secure web sites when handing over personal information including banking and credit card details. Answer: 6 Every workplace where staff has access to email and the internet should have a policy on appropriate email use. The wording of e-mail policy will be the result of a negotiated agreement between employer and employees. These policies generally allow for limited and reasonable personal use.17 The workplace e-mail policy should cover certain basic tenets:18 E-mail should be professional and courteous. E-mail must not contain any illegal, libelous, or offensive statements. All statements meant to harass - sexually or otherwise - are prohibited. E-mail is for business purposes, not for personal use. All e-mail is company property. The company has the right to access e-mail sent to or from every computer. The company has the right to retrieve e-mail stored on its servers that users have deleted from their e-mail programs. Employees who violate the e-mail policy will be subject to disciplinary measures or termination. While it is acknowledged that access to staff e-mails by system administrators may be required in certain circumstances, it is unlikely that pervasive, systematic and ongoing surveillance of staff e-mails should be necessary. Workplace policies will sometimes use words such as “inappropriate”, “unacceptable”, “obscene”, “indecent” or “pornographic” when defining the sort of material that should not be accessed from or received at workplace computers. For a variety of liability and business reasons, the workplace needs an e-mail policy. The increasing use of electronic mail in the workplace has generated important legal questions for public organizations. The legal questions concerning e-mail in public institutions and agencies fall into two basic categories: (a) issues of employee privacy regarding e-mail messages; and (b) public access to e-mail under applicable freedom of information legislation.19 E-mail is a quick, inexpensive, and convenient business tool, but at the same time it can pose a serious threat to a company due to legal liability, data breaches, or lost productivity caused by employees who abuse the privilege for personal reasons. 20 A company can help protect itself from such threats if owners or managers  implement and then enforce an e-mail policy, a document that clearly outlines the rules and limits for employees who use e-mail -- and the employer’s right to monitor employee e-mail messages. 21 An e-mail policy is critical to avoid ambiguity that could create unfounded expectations of privacy in employer-provided e-mail.22 This also helps to reduce the extent to which employees become upset or angry when they find out that their e-mails have been monitored. 23 Workplace e-mail policies exist for several reasons. Excessive personal use of workplace computers can reduce the efficiency of the workplace, and in severe cases reduces the quantity and quality of the employee’s time for which the employer has paid. The display, even momentarily, of restricted or objectionable material on workplace monitors increases the possibility that staff will be inadvertently exposed to material they may find offensive, misogynistic, disturbing or even threatening. Such material on workplace computers can also form the basis of sexual and racial harassment claims. Policies on e-mail use represent an agreement between employer and employees on how they view their workplace environment. Workplaces are safer, healthier and more inclusive places when they are free of restricted and objectionable material.24 Answer: 7 The solutions to Internet-related crime and particularly fraud involve a wide range of strategies which extend from traditional crime control measures to novel technology-based means of preventing illegal conduct from being carried out electronically. The rapid growth in electronic commerce, the increased recognition of the importance of the integrity, security and reliability of computer data and the growing prevalence and complexity of internet crimes such as hacking, virus propagation, denial of service attacks and web site and web server vandalism prompted the federal government on 27 June 2001 to introduce the Cybercrime Bill 2001 (Cth). One of the most effective strategies used to prevent Internet-related crime is education of the public as to the nature of the security risks which they face, and how they may best protect themselves. Some organisations are providing certification services to enable users to identify legal, safe Internet sites. Users are then free to decide whether or not they wish to make use of the material in question. Although some may question their effectiveness, Internet-related activities are already subject to a variety of laws and other regulatory controls. Those who engage in misleading and deceptive practices invariably infringe local laws in the jurisdiction in which they reside or the jurisdiction in which their material is read; or sometimes both. The last thirty years has seen continual improvements in consumer protection legislation and dispute resolution procedures and many on- line activities fall within the scope of these initiatives. Unfortunately, the remedies which are available to those who have been victimised on the Internet are often practically unavailable as they would require offenders to be extradited from other places or victims to take cross-border legal proceedings. Such action is invariably beyond the means of most individuals and costs far in excess of the amount lost in most incidents. Legal enforcement proceedings can, however, sometimes be taken on behalf of groups of individuals who have suffered loss in the form of class actions against large corporations. Although these are sometimes slow and costly, victims are empowered through the weight of numbers and compensation is occasionally able to be made. The perpetrators of many Internet-related crimes, however, are often not large corporations. They are able to close-down their operations quickly and easily, move assets to secure locations and use digital technologies to conceal their identities and disguise evidence. In such cases there is little likelihood of success whether civil or criminal proceedings are taken. Those who make use of the Internet need to be made aware of the risks they face and informed about the nature of the various on- line practices which are present. Already there are substantial amounts of information of this nature available. The challenge lies in ensuring that users are made aware of its existence. In this regard, certification and notification systems, which permit users to identify readily businesses which have been found to be trustworthy, seem to provide the best option. Technology needs to be developed, however, to ensure that certification services are, themselves, unable to be manipulated. Fraud relating to the process of certification might also develop in the future as might the use of ‘phoenix businesses’ which re-establish themselves immediately they have been closed down because of improper practices. The challenge facing those who would minimise Internet-related crime is to seek a balance which would allow a tolerable degree of illegality in return for creative exploitation of the technology. Even at this early stage of the technological revolution, it may be useful for individuals, interest groups, and governments to articulate their preferences and let these serve as signals to the market. Markets may then be able to provide appropriate responses which governments are unwilling or unable to achieve. Internet-related crime is bound to increase as the new century unfolds. By making effective use of traditional crime cont rol measures coupled with some sophisticated technological solutions, it may, however, be able to be kept within manageable limits. In Australia, the statute and treaty law both refer to Internet-related crime. Internet related crime has a narrow statutory meaning as used in the Cybercrime Act 2001 (Cwlth), which details offences against computer data and systems. And a broad meaning is given to Internet-related crime at an international level. Finally, there is still a need to reform many laws in Australia relating to Internet offences as well as computer-related conduct. The work of the Model Criminal Code Officers Committee (2000) is proceeding in this regard and its latest Discussion Paper on Computer Crimes and Jurisdiction should solve many problems and enable Internet-related crimes to be dealt with effectively. There are many Organisations relating to Internet Offences’s Reporting25, such as, Australian High Tech Crime Centre, Child Explotation and Online Protection Centre, Cyber Law Enforcement.org, Cybercrime Coordination Unit, Cybertip.ca, How to Report Internet-related Crime, Identity Theft and Fraud, INHOPE, Internet Crime Complaint Center, Internet Fraud Watch etc. Read More