An Overview Of The Internet And The Law

By Dennis S. Deutsch, Esq.



It is almost impossible to believe but just a year ago the terms, "internet", "world wide web" and "surfing the web" simply were not a part of our everyday language. Yet, in a short period of time (even by technology standards), the Internet has exploded. Not only are we all somewhat familiar with its existence, to be certain, our children are experienced "web-surfers" and "web-chatters".

The Internet, however, is not the new phenomenon we might believe it is. The "internet" is actually part of a larger communications highway or "information superhighway" also known as the National Information Infrastructure (NII). What the Internet actually is, is a network of individual computers or computer systems connected by means of a routing protocol (TCP/IP). Its genesis can be found in the 1960's when the government subsidized a program of connecting university and government research laboratory computers.

Contained in this structure of communications capability is the World Wide Web (WWW). This can best be viewed as a subdivision of the Internet which permits communication by means of files which conform to what has been termed the "hypertext transfer protocol" (http). These files, in turn, are formatted in a standard which is referred to as the "Universal Resource Locator" (URL) which permits the identification of the sector of the Internet in which the file is contained. Hence, we now refer to these identification factors as "internet addresses" which appear as such names as:


Internet Law

Is there any Internet Law? If there is, the cases are few and far between. Actually, the Internet has spawned some very rapid response by both the courts and legislative bodies. To a large degree, however, "internet law" is still in its infant stage and we can only speculate as to how certain issues which are arising daily will be handled. Some of these outstanding issues arise from the fact that the "internet" is not a legal person. There is no Internet provider per se. Certain providers, however, whether they be individual or corporate, provide access to the Internet and place information in a format (i.e., the proper protocol) for access on the Internet. Are these providers publishers? Can they be held legally accountable for the information they make available? Since the Internet is literally worldwide, what laws are applicable to whom? These are just some of the emerging questions. Consider the following problem areas.


Intellectual Property

Copyright. You access the Internet and using the Yahoo search engine access a "shareware" provider home page. From the home page you further access a particular program from a distant state in the United States. The program contains a copyright notice on it, although the party who put the program on the Internet knows that he took the program from the public domain.

In effect, the assertion of a copyright interest constitutes a bad-faith assertion of an intellectual property right. A bad faith assertion of an intellectual property right may constitute an antitrust violation. See CVD, Inc. v. Raytheon, 769 F.2d 842 (1st Cir. 1985).

The Internet law question, however, is not so much as to whether the party who made the program available through the Internet is culpable. The deeper question is the potential liability of the party who designed and provided the home page as well as the potential liability of the creators of Yahoo.

Trademarks. One interesting aspect of the Internet is that you get to choose your own address by which other parties may contact you by e-mail or access your home page. Parties are choosing addresses which contain trademarks of other parties. This is happening in great numbers essentially due to the fact that so many lay persons are taking Internet addresses and, frankly, aren't at all sensitive to the trademark infringement laws. It is also happening in corporate America. Sprint Communications, for example, tried to tie up the Internet address "" to the frustration of MCI Communications. (Ultimately, MCI obtained use of this address.) There is a registration process available through Network Solutions of Herodon, Virginia. (The service was formerly known as InterNIC and could be reached at

There are roughly 600 to 1,000 new registrations daily. The use of the Internet does not diminish the infringement. To deal with this problem, certain Internet user groups are currently discussing ways to sensitize users to the legal implications of their chosen addresses.

Communications Law

Take the same fact pattern set forth above. Make the following modification. Rather than having access to shareware, the home page provides a means of ordering and downloading software for a fee. Give some thought to the status of the provider of the home page and the software.

Arguably, the owner of the home page constitutes a "common carrier" under the Federal Communications Act of 1934. As such this Internet provider may now be subject to various restrictions as set forth in that act, including:

Tort Law

Use of the Internet may give rise to an action in tort.

Intrusion upon seclusion (Restatement of Torts 652(B) may arise from the intentional interception of messages intended to be kept private. E-mail sent on the Internet is susceptible to such intervention.

Defamation. In one of the truly real "internet law" cases, the issue of the defamation of an intermediary supplier arose. This is an "internet law" case even though the Internet was not involved. However, the fact pattern could just as easily apply with respect to an internet provider or web page provider. The case at issue is Cubby, Inc. v. CompuServe, 776 F. Supp. 135 (S.D.N.Y. 1991). In this case, the District Court found that CompuServe was not liable for defamatory information distributed by subscribers of evidence that it knew or should have known of the defamatory aspect of the information flowing through its files.

Compare this case, however, with Stratton Oakmont, Inc. v. Prodigy Services Co., No. 031063194, N.Y. Sup. Cl, Nassau County, where it was found that on-line service providers such as Prodigy, could be found to be in the position of a publisher and thus susceptible to liability for defamation or fraud because it retained supervision and control over that which appeared on its pages. The case is still pending and recently reported a "tentative" settlement.


Statutory Violations

The Computer Fraud and Abuse Act (18 U.S.C. Section 1030) makes it a crime to access a "federal interest computer" under certain circumstances set forth in the statute:

While traditionally this Act has been used both to prosecute parties who access a computer either on site or directly by means of a modem, we can now envision additional methodologies of committing prohibited acts by means of the Internet. In such circumstances, will net accessors or web page providers be liable for aiding and abetting?

State Computer Crime Acts have been enacted as of this writing in some thirty-five states. New Jersey's is codified at N.J.S.A. 2A-38A-3 and provides, inter alia, for compensatory and punitive damages if persons or businesses are damaged. Again, the Internet potentially provides easier access worldwide to virtually every computer user.

Wiretap Act. Any interception of a message being transmitted through the Internet which is not authorized by the sender may constitute a violation of the Wiretap Act of 1986 (18 U.S.C. 2511 et. seq.)


Ethical Violations

How many of you currently run in a LAN environment, permitting Westlaw or Lexis access from every attorney's desk, while at the same time permitting each attorney to access the Internet as well as case files? The full state-of-the-art law office. You may be breaching your obligations of providing confidentiality to your clients. Consider the problem presented to our kindred in the medical profession. In Behringer v. Medical Center at Princeton, 592 A.2d 1251 (Law Div. 1991), the court found that failure to recognize the potential for a breach of confidentiality provides no defense to a failure to adequately safeguard patient confidentiality. Have you adequately considered what access to your client files may exist through your Internet connection when you are on-line?


Consumer Fraud

As you no doubt are aware, New Jersey, like many other states has a strong Unfair Trade Practices Act. It is codified at N.J.S.A. 56:8-1 et. seq. One of the prescribed prohibited practices is fraud or deception in connection with the advertisement of a product. In some respects, the Act is similar to contain FTC trade restrictions. Although there are no reported cases to date dealing with a claim of deceptive trade practices in New Jersey against an Internet provider, the FTC did bring an action in 1994 against an advertiser on America Online. See Federal Trade Commission v. Brian Corzine, CIV-S-1446 DFL-JLM (E.D. Cal. Consent Decree, Filed November 28, 1994). The FTC brought no action against America Online. Our statute provides immunity for the party who "disseminates such advertisement when the owner, publisher, or operator has no knowledge of the intent, design, or purpose of the advertiser, "N.J.S.A. 56:8-2." If referrals are made on a home page to a party who false advertises, will such immunity apply? This kind of issue has been held to be a triable issue with respect to the "publisher's privilege or immunity." See Thomas v. Times Mirror Magazines, Inc., 159 Cal. Rptr. 711 (Ct. App. 1979).


Constitutional Issues

There is no legal reason why the first amendment to the United States Constitution would not apply to the Internet. However, bear in mind, not all speech is constitutionally protected. Obscene material specifically has been excluded from this protection. See Sable Communications v. Federal Communications Commission, 492 U.S. 115 (1989). We now, therefore, get very much caught up in the entire lines of cases which distinguish between obscene material and indecent material which is protected, although it may be kept from children. Within the past few years the growth of on-line chat groups has fostered an entirely new outlet for potentially indecent and obscene communications. "Cybersex" is truly a term of the mid-1990's.

The Internet, however, has now created the means for the rapid and easy transmission of pornographic material right into the home. In rapid response to this program, early in 1996 the Telecommunications Act of 1996 became law. The Act provides, inter alia, that it is illegal to, by means of a telecommunications device, knowingly initiate transmission of any comment or suggestion or other communication which is obscene, lewd, lascivious, filthy or indecent with the intent to annoy, abuse, threaten or harass another person. A federal court has already enjoined the application of the act in response to a suit brought by the American Civil Liberties Union which has challenged the constitutionality of the Act.


Contract Formation

Assuming the basic elements for a contract are present with respect to a contract which is formed "on-line", what assurances can exist to identify the party who is accepting the offer. Since the vast majority of systems in place now do not provide the means for actually signing a document, the normal means for actually signing a document, the normal means of acceptance of an offer made electronically is either typing in information or simply "clicking" with a mouse at an appropriate place on the screen. Although these are acts of violation adequate to constitute an acceptance (after all, those of us who do business on the electronic frontier are simply making our "mark" as our illiterate ancestors did), there is no basis to confirm who the party is that purportedly is entering into the agreement.

These problems are currently under discussion. One interesting aspect of this issue is the means of taking electronic acknowledgments. The Science and Technology section of the American Bar Association has a special project exploring this possibility of the "Cyber Notary."


Cyber Banking

In 1994, Congress enacted the Electronic Funds Transfer Act, 15 U.S.C. 1693 a-1693q. As the name implies it regulates the electronic transfer of monies. Typically its applicability has been with respect to transfers between financial institutions. Its scope is now enhanced with the growth of personalized electronic banking. The applicability of federal regulation of this entire new means of banking is a wide open issue.


International Law

A number of enterprising institutions have begun advertising on line gambling in various computer magazines with the disclaimer that participating in this activity may be illegal in the United States. The scenario of operation is quite simple. A computer with proper programming is set up in a foreign country which has no restrictions on gambling. The facility is made available for access through the Internet. Credit cards are accepted to open an account and as a means of paying off. Now, every home has a "real" casino at its fingertips. A violation of U.S. law? If so, how can it be enforced without a treaty with the nation housing the casino-computer?


Procedural Law

Does providing access to information on the Internet subject a party to a state's given "long-arm statute" for the purposes of obtaining jurisdiction of the party. (Certainly this scenario was never envisioned in 1945 when International Shoe Co. v. Washington, 326 U.S. 310 was written). Are these adequate minimum contacts? This is just another issue yet to be resolved.



What I have attempted to do in these few pages is to sensitize the practitioner as to the whole new world of law which is enfolding as the Internet expands. As you and your clients become accustomed to using the Internet and venture further into the field of computer utilization, you must remain open to new ideas and applications of the basic concepts of law you know and love, to this new area which will surely expand in the months and years to come.


Copyright © 1996, Dennis S. Deutsch and the Bergen County Bar Association. All Rights Reserved.