Got Cyber Insurance?

Q. What do most companies not have none of,
most companies think they have some of,
but no company ever wants to use any of?
A. Cyber Insurance

According to the Computer Security Institute, use of cyber insurance is still low, but on the rise. More than two thirds of 313 companies surveyed have no cyber insurance. The biggest threats - viruses and unauthorized access to information - accounted for over $25 million in losses among the companies. Mobile hardware theft and intellectual property infringement round out the top four threats, accounting for about 75%s of cyberthreat losses. 90% of the companies acknowledged some type of cyber security breach, with annual losses averaging six figures per respondent.

Most companies believe they are covered in the event of a cyber security breach, but most are not. Read your policy carefully to determine if it covers damages related to cyber liability threats such as:
1)Data theft, alteration or destruction (fraud or virus)
2)Business interruption,
3)Intellectual property infringement(patent, trademark, copyright);
4)Extortion (hackers);
5)Third party claims (denial of service attacks).

Some companies try to cobble additional coverage into their bricks and mortar policies. While one policy does reduce the likelihood of double paying for the same coverage, obtaining cyber insurance from a company specializing in such policies has advantages. Probably the biggest advantage is the access to the company’s risk mitigation practices. Insurance companies specializing in cyber insurance ask you a lot of questions about your security procedures. You can use these questions like due diligence check-off list; discovering the most inexpensive way to reduce the most damaging threats. Adding firewalls, comporting with state and federal cyberlegislation, backing-up off-site, updating to the most current antivirus and intrusion software and physically securing mobile hardware are important steps for any company. Having your own cyberliability agent can take you a step further – recommending ways to reduce threats specific to your industry, and even your particular business.

Cyber insurance is more expensive than regular insurance for several reasons. First, customers are not as careful as they should be – they are just not as aware of cyberthreats as they are of a slippery marble floor. Second, the bad guys are constantly trying harder to create a situation where you might actually have to use your cyber insurance. Third, insurance companies have not yet created handy tables that they can use to plug in a company and spit out a premium. All cyber insurers are not created equal. Selecting the cheapest company may be cheaper per incident, but selecting an insurer experienced with this type of policy may make your competition a more likely target.

Brett Trout

cyber insurance cyberliability Computer Security Institute cybersecurity cyberthreat

British High Court Finds For The Da Vinci Code

Nearly a year after a lower court ruling that The Da Vinci Code author Dan Brown had not infringed the copyright on the book The Holy Blood and the Holy Grail, Britain’s Court of Appeal has affirmed the ruling. The High Court noted that while copyright protects an author’s labor in researching and writing a book, it does not extend to facts, theories, and themes.

The Court not only ruled against the defendants Michael Baigent and Richard Leigh, but ordered them to pay Random House, Dan Brown's publisher over $600,000 for the cost of the appeal. This seems like a lot, but compared to their own legal fees, estimated to be over $6 million, the penalty does not seem so bad.

Brett Trout

da vinci code copyright Dan Brown Holy Blood Baigent Leigh

Katonah Votes to Battle Martha

In January, I blogged about Martha Stewart filing six federal trademark applications on the word Katonah. Katonah just happens to be the name of an affluent hamlet in Bedford Township, New York. It seems the Katonah Village Improvement Society voted yesterday to authorize the "trademark committee" to spend $200 toward opposing Martha's trademark applications. Heck of a deal, especially since the United States Patent and Trademark Office does not seem to have a problem with the trademark applications. The USPTO has already passed the four remaining trademark applications on toward publication.

According to the Lower Hudson Online, the president of the Katonah Chamber of Commerce, Ron Romanowicz, notes a concern whether Katonah business will still be able to use the village's name if the trademarks eventually register. I would say the best way to find out would be to authorize a $200 trademark opposition budget. You should have your answer shortly.

Brett Trout

Martha Stewart Katonah trademark trademark opposition

COPA R.I.P.

The District Court for the Eastern District of Pennsylvania yesterday held the Child Online Protection Act (COPA) 47 U. S. C. §231 unconstitutional. COPA addresses preventing children's access to online pornography. COPA, passed into law in 1998, is not to be confused with the Children's Online Privacy Protection Act (COPPA) 15 U.S.C. §§ 6501-6508 covering the collection, use, and disclosure of personal information from children.

In 1999, the Third Circuit struck COPA down as being too broad. In 2002, the Supreme Court held the Third Circuit's rationale insufficient and sent the case back down for further review. In 2003, the Third Circuit struck COPA down again, holding that it hindered free speech. In 2004 the Supreme Court upheld the Third Circuit's injunction, but sent the case down for determination of COPA's constitutionality.

The case then hit the headlines when Google refused to comply with a subpoena demanding information about what searches people had conducted. According to the Internet Cases blog, Judge Lowell Reed of the Eastern District of Pennsylvania, ruled yesterday that COPA violates both the First (free speech) and Fifth (due process) Amendments to the United States Constitution and enjoined Attorney General Gonzales from enforcing or prosecuting matters premised upon COPA.

Brett Trout

due process Internet COPA pornography free speech

Become a Legal Expert in Minutes

Need some info on a particular area of law, but don't have a Lexis account or a library of treatises? Here is a quick no-brainer for those of you interested in law blogs (blawgs), but not yet to the point of having your own RSS feeds. If you want to find out what blawgs have to say about any legal topic, check out Justia's blawg search. While you may have to cull through some tripe, within a matter of minutes you should have all the legal information you need.

Brett Trout

Justia blawg law research searching

Malpractice Carrier Shuts Down Blawg

Law.com reports that a legal malpractice insurance carrier may be putting the kibosh on law blogs (blawgs). The article states that the insurance carrier, Executive Risk Specialty, a unit of Chubb, informed lawyer James Paone II, of Lomurro Davison Eastman & Munoz that lawyer blogging "is not a risk they are interested in undertaking."

Thankfully, this appears to be an isolated case. The situation may even turn out to be more of an issue of the use of appropriate disclaimers than a mandate on blawgs in general. Most of the major blawgs do not seem to have chimed in on the issue as of yet. Perhaps some of them are hoping the issue will simply fade away.

I would like to hear the blawgosphere's take on this, both from readers and writers. My hope is that this is an isolated instance of some "fire bad" insurance company Luddite not taking the time to determine that blogs are simply another interface lawyers have with their clients.

A key to avoiding legal malpractice claims is communication with the client. What is legal blogging but communication. Blawging not only hones a lawyer's communication skills, but mandates a certain level of understanding of current legal issues in the blawger's particular practice area.

Although this is just a guess, like patent attorneys, I would assume that top notch blawgers experience significantly fewer malpractice claims. More savvy legal malpractice carriers may actually prefer clients that blog, but are afraid to tip their hands. Perhaps they are hoping to keep their little secret, at least until profit driven competition starts offering blogging discounts to attract what is likely a lower risk class of clientele.

Thanks to Matt Krigbaum for the heads up on this story.

Brett Trout

blawg malpractice insurance

Google Blog Search Patent

Kevin O'Keefe, of the world reknowned Lexblog, has an interesting post on Google's new Blog Search patent application. Although Google filed the patent application in 2005, the USPTO just published the application last week.

Kevin also provides a handy chart, compiling information from Bill Slawski, on how Google Patent Search ranks blog search results and filters spam. It is worth a look - at the very least just to see if you are doing anything with your blog that Google might see as a spam indicator.

Brett Trout

google spam blogs patent lexblog

Developing Patent Attorney "Street Cred"

I just ran across an interesting string of comments over on Patently-O. The actual blog post covers the new United States Patent and Trademark Office Accelerated Examination procedure.

Much more interesting is the colloquy involving whether the name of the inventor or attorney makes a difference in whether the USPTO issues a final rejection of the patent claims. While neither should make a difference, it makes sense that an individual patent examiner might want to avoid locking horns with a patent attorney known for a long unbroken record of successful patent appeals. It is not that an examiner would grant allowance to an invalid patent. A more likely scenario would be that an examiner might determine spending an hour discussing the addition of patentable limitations to the claim might avoid days work of work on an appeal that drops the case right back in the examiner's lap.

In my case, I have enjoyed considerable success filing appeals. Rather than try to exploit this success, I do not want to develop a reputation for losing any appeals. Appealing only solid cases, and pursuing them with a zealous advocacy has proven to be quite beneficial. I would like to think that if you develop a reputation for only appealing legitimate cases, you end up forced to appeal fewer cases.

When searching for the Best Patent Lawyer in the World, the patent attorney's record of appeals before the Board of Patent Appeals and Interferences, might just be one of the best questions you could ask.

Brett Trout


patent examiner USPTO patent appeal patent attorney

West Des Moines Business Lawyer Seeks Same

My buddy Rush Nigut and his West Des Moines Law Firm Sullivan & Ward, P.C. are seeking a lawyer with 15+ years experience and an established practice. Sullivan & Ward's practice includes representation of many rural electric cooperatives and generating cooperatives throughout the state of Iowa. The firm's lawyers also serve as counsel to many businesses throughout Iowa, including technology and manufacturing companies, retailers, medical professionals and real estate entities. In addition, lawyers in the firm handle litigation, employment law, estate planning and family law.

Sullivan & Ward is an AV-rated law firm and has an impeccable reputation. For more information, check out Rush's blog post or contact Mark Landa at the law firm.

Brett Trout

Des Moines Job Lawyer Sullivan & Ward

Bob Spongee vs. Viacom

Thanks to Lindy for the heads up on this broiling copyright issue.

Troy Walker, creator of the character Bob Spongee, has sued Nickelodeon, Viacom, Paramont Studios and Stephen Hillenberg over SpongeBob SquarePants. Walker notes several similarities between Bob Spongee and SpongeBob SquarePants. In addition the the name "Bob", Walker notes the googly eyes, working class, unemployed nature of both sponges and the fact that both characters live in a house. Walker also points out that the first comic strip he distributed with his Bob Spongee doll (an actual kitchen sponge with googly eyes and a drawn on face) shared its name "Sponge for Hire" with a 2004 episode of SpongeBob SquarePants.

Viacom has countered that the two characters share are not substantially similar in any of their copyrightable elements. Walker is demanding $1.6 billion. Perhaps Viacom will simply endorse over the check they get from YouTube ; )

BTW/ It is interesting to compare SpongeBob's SpongeBob's Mother with Bob Spongee's daughter. Separated at birth?


bob spongee spongebob squarepants viacom Nickelodeon Hillenberg

Is YouTube Dead?

Multi-media Leviathan Viacom has just filed a $1 billion copyright infringement lawsuit against YouTube. Others have sued YouTube in the past, but this is the first lawsuit that could actually bring down the entire YouTube business model. I am actually surprised it has not happened sooner.

Historically, YouTube has taken refuge under the Digital Millenium Copyright Act (DMCA). The DMCA protects Internet Service Providers (ISP) from infringement claims under certain circumstances. Viacom apparently seeks to limit those certain circumstances to something other than an unlicensed YouTube type business model.

While it is unlikely YouTube would disappear altogether, Viacom's lawsuit could force YouTube to get out of the house and get a job. If Viacom is successful, it will not be long before smaller copyright owners all pile on. There are undoubtedly thousands of copyright owners that want YouTube to be more pro-active in filtering out copyright infringing videos, but are just waiting for Viacom to take the heat and do all of the heavy lifting.

Lat month Viacom forced YouTube to remove much of its copyrighted content, such as "The Colbert Report." Then Viacom inked a deal with YouTube competitor Joost. Viacom appears to be pushing its chips "all in" on this one. Just like copyright claims stopped the Napster free ride in its tracks, so too may a judge turn YouTube into a mere shell of its present incarnation. Although this would obviously be a blow to YouTube, even more importantly it would mean I would have to look for a new hobby to fill up what portends to create a twenty hour vacuum in my work week.

Brett Trout

DMCA copyright YouTube Viacom

Electronic Discovery Comes to Iowa

In the past few weeks I have examined the new federal rules for electronic discovery in fairly great detail (at least for a blog). Now Iowa has proposed electronic discovery rules for Iowa state courts. A Supreme Court advisory committee is taking public comment on the proposed rules until May 1, 2007.

This should come as a great relief to computer savvy Iowa attorneys and should serve as a call to arms for the neo-luddites. If you would like information on Lawpportunities' seminars covering what every Iowa business needs to do to prepare for the new rules changes, contact Rush or myself. For more information on the proposed rules, including a link to a podcast discussing the new federal rules, which are fairly similar to the propsed Iowa rules, check out this post by business lawyer Rush Nigut on Lawpportunities.

Brett Trout

electronic discovery esi federal rules of civil procedure, Iowa rules of civil procedure iowa rules of civil procedure frcp ircp

Iowa and Ethanol Trade Secrets

The Trade Secrets Blog reports Broin and Associates, has sued a former Iowa ethanol plant operations manager and a former maintenance technician for misappropriation of trade secrets. Broin operates plants in Iowa and licenses ethanol plant design and operation technology to various plants.

The employees named in the lawsuit, Gary Hanson and Robert Akers, worked at the Horizon Ethanol plant in Jewell, Iowa before leaving for the Sterling Ethanol plant in Colorado. Jewell is just north of Ames. Broin has a confidentiality agreement with Horizon requiring plant employees to sign non-disclosure and two-year non-compete agreements.

The case is Horizon Ethanol LLC et al v. Gary T. Hanson and Robert A. Akers, case number 3:07-cv-03017-MWB in the U.S. District Court for the Northern District of Iowa.

Brett Trout

trade secrets misappropriation Iowa ethanol

How Intellectual Property Can Ruin Your Business

Rush Nigut and I were speaking just the other day about how general practitioners or even transactional law attorneys often screw things up for their clients when they start messing with intellectual property issues. While they may grasp the broad issues, there are far too many trips and traps to go wandering through the IP jungle without at least a knowledgeable guide.

I then had a plate o' shrimp moment purusing Ron Coleman's informative Likelihood of Confusion blog. Apparently a couple guys at Sheppard Mullin were thinking the same thing Rush and I were. Check out the blog post The Top Ten Ways Copyright Law Can Mess Up Your Transaction. While you are at it, you might want to extrapolate those fine points regarding copyright to patent, trademark, trade secret and cyberlaw as well.

Brett Trout

copyright patent trademark trade secret intellectual property cyberlaw

Community Patent Review Project

The United States Patent and Trademark Office (USPTO) has selected The Institute for Information Law & Policy at New York Law School's Community Patent Review Project as one of its initiatives. In areas like Internet-related patents, the USPTO's database is lacking and cannot possibly keep pace with the rate of innovation. The Community Patent Review Project opens up patent applications for review by anyone with access to the Internet. The goal is to reduce patent examiner workload and increase the quality of issued patents.

Persons submitting knowledge about patent applications will have to provide detailed information about themselves. Online voters will determine the top ten pieces of prior art to submit to the patent examiner. While the goals are laudable and I wish the project well, I will respectfully withhold my thoughts on the project until the project has a chance to get off the ground. If you would like to submit your patent application for review, you can do so here.

Brett Trout

USPTO community patent project patent

RIAA Boycott in Full Swing

See your alma mater on the Recording Industry Association of America's (RIAA) list of “Downloading's Most Wanted”? According to the RIAA, these are the top 25 music-pirating schools in the country. See your alma mater? No? That might be a good thing.

I was initially surprised none of my alma maters made the list. Then it dawned on me. It was not that the students at my old schools were no longer hip, it was that they were too savvy to leave a trail of breadcrumbs from the bakery to their dorm rooms. You see, in my experience, the RIAA does not pursue the most prolific copyright infringers.

Vying for the title Worst Company in America the RIAA pursues children and dead grandmothers. It is not that the mega uploaders from the former Soviet Republic, and mini-mega downloading pirates here in the United States are less culpable, it is just that they leave fewer tracks. The also have enough organized crime connections or too little money to make pursuing them any fun. So, in their infinite wisdom, the RIAA goes after the end user. I mean it worked so well eliminating the drug problem, why not expand the theory to music downloading?

Far be it from me to dissuade anyone, including the RIAA, from defending their intellectual property. As an intellectual property attorney, this is my bread and butter. My concern is that, from my vantage, it seems as if the RIAA is targeting the weakest, least culpable infringers, rather than the real bad guys. Sure, you could spend the next four years in federal court convincing a judge that your roommate did it. You might even win. The problem is that who are you going to find to defend you for less than the RIAA's $5,000 demand? It is just easier to pay. Unfortunately, the RIAA uses that $5,000 to finance more lawsuits against other people just like yourself.

I personally believe that if we could cut out the RIAA, we would have a lot more music, more cheaply, with fewer restrictions, with more money going directly to the artists. This may be at the expense of manufactured commodities like Britney Spears and the Backstreet Boys, but I for one am willing to bite that bullet. The RIAA’s attacks on privacy and free speech have prompted Gizmodo to start a boycott of RIAA musicians during the month of March. I would encourage everyone to visit Gizmodo, examine the reasons behind the boycott, join the resistance and maybe even slip a buck of two to the Electronic Frontier Foundation.

Brett Trout

RIAA copyright downloading

LucasArts Opposes Digg.com Trademark

LucasArts Entertainment Company (George Lucas' "Star Wars" company) has filed a trademark opposition against Digg Inc.'s attempt to register the trademark Digg for use in association with "providing online news and information in the field of technology, namely, computer games and computer enhancements for games." While Digg obviously deals with much more than video games, Lucas is apparently concerned that this use will lead to consumer confusion.

Back in 1994 LucasArts filed for registration of the trademark The Dig for a video game. Lucas does not want people mistakenly assuming Digg.com is affiliated with LucasArts. While opposition proceedings typically take a year or more to complete, with a Goliath like LucasArts in the fray I would look for the parties to settle the issue well before the Trademark Trial and Appeal Board gets a formal crack at it. But who knows, Digg.com may just have a ball bearing and wrist rocket up its sleeve.

Brett Trout

lucasarts Star Warsgeorge lucas digg trademark trademark opposition the dig