ToS changes legal panel transcript (1): Agenda Faromet

Main Page Tim Faith

This is a transcript of the presentation given by Agenda Faromet at the opening of the October 19th 2013 legal panel convened to discuss changes made to the Linden Lab Terms of Service governing their products and services in August 2013.

If you have come to this page first, please read the introductory notes for details on the panel and its purpose. Links at the foot of this page provide access to the other sections of this transcript.

Agenda Faromet (image courtesy of LaPiscean Liberty)

So, hi everyone, I’m Agenda. First-off, I know that this is a controversial topic right now, and I kind-of feel like half the people here are maybe here with pitchforks and torches, ready to lead the revolution against Linden Lab for the Terms of Service change and half the people here are really just hoping that someone will tell us that it’s all OK and that there really isn’t anything to worry about. And I’m afraid that I’m probably not going to make any of you happy, because the answer is somewhere in the middle; because I’m a lawyer and the answer is always somewhere in the middle.

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00:44: First, we’re going to talk about, a lot of the rights we’re talking about here are copyright rights. So we’re going to talk about what exactly we mean by copyright, and then we’re going to talk about the terms that show-up in the terms of use and what exactly they’re claiming in the terms of use. Then we’re going to look at what terms are normal in a terms of use, and I know that a lot of people have posted some other terms of use, maybe from OpenSim or whatever, but we’re going to look at some of the other terms of use that we see a lot in social media.  Then we’re going to take a close look at the Second Life terms of use, once we have a grounding; and then we’re going to look at where we go from here, and then Tim and I are going to start talking about where we go from here once we know what the playing field looks like.

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01:39: So let’s look at copyright. So we talk about copyright a lot, but what exactly copyright means is when you create something, when you are a content creator, you are granted exclusive rights over your work, and those rights are:

  • The right to make copies
  • The right to share or transfer or distribute those copies
  • The right to modify or adapt those copies or the work
  • The right to publicly perform  those works. So if it’s music or if it’s a movie or a drama, the right to publicly perform it or publicly display it, to display those works in public.

And “exclusive” means that nobody gets to do any of those things unless you give them permission. But, when we look at the Internet, the Internet generally involves all of those rights. In order to transfer something across the Internet you’ve got to make a copy of it, you’ve got to transfer it across the Internet, you’ve got to be able to modify it; in Google you see thumbnails, those are actual modifications of the work. You’ve got to be able to publicly perform something in YouTube, you’ve got to be able to display works in an browser or what have or – or a viewer.

So these are implicated, all across the Internet, and so when someone creates something, you’ve got to be able to give your rights, or at least licence your rights, give permission to your rights to many, many, different entities across the Internet. We’re used to doing that; it’s OK; this is common.


03:37: So we see licence terms, and when you licence something, you’re just giving permission. So:

  • A non-exclusive licence just means it doesn’t belong to one party; it means that you’re giving permission to this person, and this person and this person, and that’s not the only person that gets to do something with your stuff.
  • Perpetual – the permission does not end; it goes forever
  • Worldwide is obvious
  • Irrevocable is you can’t take it back. Once you give permission, you don’t get say, “Give it back, you don’t get to have permission any more”
  • Royalty-free means the person that has permission doesn’t owe you any money
  • Sub-licensable – when you give somebody permission to do a whole bunch of things, that person can then turn around to someone else and say, “OK, you get to do X, Y, and Z to this content”, even without the permission of the creator
  •  Transferrable – we all know what transfer means
  • Limited or unlimited is self-explanatory, but we’ll see in a minute exactly what that means, because that’s really important
  • This licence ends – we really want to see when this licence ends; that’s important.


05:15: So, normally we will see that a terms of use contains IP licences both ways, because you have to be able to use Facebook’s intellectual property, you have to see it on your computer, and they have to see your stuff on their servers.

A well-written intellectual property licence is limited. It’s limited in purpose, it’s limited in term and it’s limited in scope. And the reason people are angry right now is because not all terms of service and intellectual property licences are well-written. so let’s take a look at some1.

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06:07: Most of us are familiar with Flickr. So [with] Flickr, you’ll see that Yahoo does not claim ownership of content, so your content is your own, and you grant Yahoo a worldwide, royalty-free and non-exclusive licence – and that’s common. It needs to be worldwide licence because Yahoo is visible worldwide. They need royalty-free because Yahoo doesn’t want to pay you every time you put something up on Flickr, and they need non-exclusive, because Yahoo doesn’t want exclusive licence over your content. If Yahoo had exclusive licence over your content, then Yahoo would be the only person that ever got to use your content, including you. So non-exclusive is a good thing.

06:53: So Yahoo wants a licence to use, distribute, reproduce, modify, adapt, publicly perform and publicly display your content. Yahoo wants to do all of those things, and it has to, but Yahoo wants to limit it. It wants to use it only for the purpose for which the content was submitted or made available, and it only wants to do it for as long as you continue to include the content on the services, so as soon as you take it off the services, the licence ends. You’re done. And that’s a good licence, that’s a really friendly licence.

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07:27: Facebook is not quite as friendly. You give Facebook a non-exclusive world-wide, sub-licensable, royalty-free licence. The good thing about Facebook’s licence ends when you take your content off the service. The bad thing about that is it only ends if you have not shared it with anyone; so if you have shared it with someone, its Facebook’s and so your licence never ends.

08:04: Facebook’s terms of service used to allow you to actually end your licence, and in 2009 they removed that. Now your permission never ends if you have shared content with others. That’s Facebook.

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08:20: TwitPic is evil. You grant TwitPic the same kind of licence you pretty much anyone, and you do it for the purpose of promoting and redistributing all or part or all of the service, which can be a gotcha. What’s interesting is that if you post content on Twitpic, and someone else wants to use your content, they are required to get permission from TwitPic not from you, and to credit TwitPic, which is a little weird. So that’s the evil of TwitPic.

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08:59: And LinkedIn is also fairly evil. LinkedIn requires not only the ability to use and commercialise in any way known or in the future discovered, they want to use and commercialise not just your content, but your ideas, concepts, techniques or data. So if you have a business idea that you post to LinkedIn, LinkedIn can take it, use it and commercialise it.

09:30: So these are the kinds of things we’re all worked-up about. Second Life’s terms of service, which are not great, but these are the kinds of evil things that are out there in very commonly used social media. We see these every day.

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09:49: Now Let’s look at the Second Life terms of service. We’ll go one-by one:

  • First: you retain intellectual property rights that you already hold. If you already have the rights to your content, you own your content. That doesn’t necessarily mean that you can stop anybody from doing anything with it if you’re giving away all the permissions. So let’s keep going
  • You can only upload content that you have the permission to do so – neither of these has changed

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10:24: This next one has not changed: Linden Lab won’t pay you for the use of your works. Again, that’s not uncommon.

10:33: This next one is, I think, the worst change. I know everybody is up-in-arms about the big section, but this is the one that drives me crazy. Linden Lab may sue third parties in your name, and you irrevocably appoint Linden Lab as your attorney-in-fact for these actions. Do I want the person that wrote these terms of service to act as my attorney-in-fact? Hell, no. But since I agreed to these terms of service, that’s what’s happening, and that makes me very sad.

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11:13: So, you grant Linden Lab the right to use your content, and it’s non-exclusive so it doesn’t only belong to Linden Lab, which is fine, it’s worldwide, it’s perpetual, it is unrestricted, unconditional, unlimited, irrevocable, and that’s terrible. Linden Lab can use your content for any purpose whatsoever, and that’s not great. That’s what has people up-in-arms, is that this is so absolutely unlimited.

11:48 We see in here things like disclose, sell, resell, and you see that those weren’t in my discussion of copyright rights. Don’t be freaked-out by that. I don’t even know why those are in there. Those are not copyright rights, those are patent rights and trade secret rights, and I really think that that was sloppy drafting.

12:16: The short version is that even if those weren’t in there, they can still sell and resell your copyrighted stuff.

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12:23: How do we make it better? We need to find a way to convince Linden Lab to limit the purpose to which content can be used, limit the term of their licence and limit the scope of their licence. That’s the best case scenario, is this unlimited stuff, this isn’t working, and that’s really why we’re here.

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12:51: So where does this leave us? We can keep going with the every-man-for-himself , where people are pulling their content and fleeing the service. This kind-of puts us in an Instragram situation, where in December of last year, Instagram made a terms of service change and by January [2013], a month later, they had dropped from 16:35 million users to 7.42 million users. In one month they had lost half of their active daily users, and Instagram freaked-out and revised the terms of service. But their revision didn’t last, and they ended-up basically claiming the same rights that the controversial terms of service claimed in the first place, so all of the gain was for nothing.

13:41: We can take a hostile solution. We can send complaints to the FTC [Federal Trade Commission]. We can try for a class action lawsuit, which isn’t going to get anywhere because of the arbitration clause.

13:53: [Or] we can look for a peaceful solution, and I think that’s the best way to go.

And that’s what I’ve got, and I think now it’s Tim’s turn.

  1. Further examples of the similarities between the LL ToS wording and wording found in other terms of service / use can be found here.

Related Links

Slides courtesy of Agenda Faromet.

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