The Internet & The Market: Reading Assignments
Part I: Getting Oriented
- A. Michael Froomkin, The
Internet as a Source of Regulatory Arbitrage, (book chapter) in Borders
in Cyberspace (Brian Kahin and Charles Nesson, eds.) (MIT Press,
- J. Bradford Delong & A. Michael Froomkin, Speculative
Microeconomics for Tomorrow's Economy (book chapter) in Internet
Publishing and Beyond: The Economics of Digital Information and
Intellectual Property 6 (Brian Kahin & Hal Varian, eds., 2000).
May be useful if this is your first class on Internet issues
- Findings of fact in ACLU
v. Reno, 929 F. Supp. 824 (E.D.Pa. 1996)
- Michael Froomkin, An
Introduction to the "Governance" of the Internet
- Read the class
- Subscribe to the from
account you want to use to post to the mailing list. Click here
to send that email.
- Figure out how to make your e-mail program automatically attach
a "signature block" or ".sig" to each of your messages. Please ensure
that you sign your name to all but intentionally anonymous postings to
the class list.
me an email (not to the list!) in which you tell me about a
paragraph's worth about yourself. Please also include your day &
evening phone numbers and both e-mail and relatively lasting postal mail
addresses for my files. Your email should demonstrate your mastery of
the "signature block" above.
- Go to the Internet
Skills Page and do at least two things from each of the first four
categories. [If you took "Internet and the State" last semester -
do different ones this time plus some of the advanced ones.]
- Much of the study of e-commerce law consists of doing two
very different kinds of things:
- Learning about new technologies in order to identify what
legal issues they may pose. Quite often, this exercise requires a
fairly sophisticated understanding of both the technologies and the
relevant markets, and involves dealing with non-legal materials.
- Learning about courts', legislators', commentators' and
lobbyists' efforts to cope with legal aspects of new technologies. This
will seem more familiar. As we will see, these efforts tend to
fall into one or more of the following categories (Which category things
fall into is often controversial, sometimes with reason):
- Categorization: Figuring out which of our
existing legal categories best covers this new -- or perhaps only seemingly
new -- phenomenon.
- Strategic behavior: Taking advantage of the
new (or, more commonly, seemingly new) invention to promote a new legal
rule to displace an existing legal rule.
- Invention (rare): Attempting to craft a new
rule to deal with something genuinely new.
- One of the foundational ideas driving the organization of
this course is that it is impossible to do either of these two basic
tasks task well without understanding the technologies at issue. This
course assumes only a basic knowledge of the Internet -- how to use
email and a browser. Those skills, and a large reading list, will
provide the rest....
2. Introduction to Information Policy and Digital
Intellectual Property (IP)
- Roger Clarke, "Information
Wants to be Free"
- Keith W. Porterfield, Information
Wants to be Valuable:
- Mike Godwin, Coming
Soon: Hollywood Versus the Internet (Dec. 18, 2001)
- Jeffrey Benner, Wired.com, Is
Amazon's Honor Plan Honorable? (Feb. 6, 2001)
- Ann Carrns, Wall St. J., AMA
Moves to Fight the Posting of Its Price Codes on the Internet (Aug.
- Tim O'Reilly, Lessons
from open-source software development, 42 Comm. ACM 32 (1999) [link
may only work from computers located at subscribing institutions]
- A. Michael Froomkin, The
Collision of Trademarks, Domain Names, and Due Process in Cyberspace,
44 Comm. ACM 91 (2001) [link may only work from computers located at
- Jennifer 8. Lee, New York Times, Dirty
Laundry Online for All to See (Sept. 5, 2002)
- Look at the terms of service and privacy policies of the
University of Miami web sites and whatever other web site you use the
most. Be prepared to discuss similarities and differences.
- When is it ok to copy software? Books? Movies?
- Who owns (should own?) information about you? Do you
know? Do you care? Why?
- Which extreme is more frightening: a world where no data at all
can be copied without payment/authorization/record-keeping, or one of
information anarchy where no one can be prevented from sharing data at
- Larry Lessig argues in perhaps the best-known book on
cyberspace legal issues that "Code is Law". To what extent does
the way things are coded define outcomes? Or does it just define
- Does the "power of code" (if it exists) defeat government
regulation, or enhance it by providing another thing that governments
- The trademark law example is one of the (in my opinion)
relatively few areas in which the existence of the Internet seriously
undermines existing legal categories. Can you think of others?
Is regulatory arbitrage one of them -- or not? Is the easy
copying of digital IP another example?
3. Introduction to E-commerce
- Some Sample Business Models
- Don George, Salon.com, Captain
Kirk's Secret (July 14, 2001) and Ira Carnahan, Slate.com, The Economics of Priceline and
what Priceline says about the American economy, (May 19, 2000)
- The Economist, Visible
Hand (Sept. 18, 1999) and NexTag, Help
for First-Time Visitors
- Kevin Sutehall, Developments
in Banking Law VII: Electronic Banking, 21 Annual Review of
Banking Law 58 (2002)
- John Schwartz, New York Times, From
Unseemly to Lowbrow, the Web's Real Money Is in the Gutter (Aug. 26,
- Voyeur Dorm v. City of Tampa, 265 F.3d 1232
(11th Cir. 2001) (westlaw
- Walter S. Mossberg, Wall St. J., Real Consumer
Choice Has Been Early Victim In Battle of the Titans (Aug. 2, 2001) (westlaw)
- Keith Regan, E-Commerce Times, Amazon's
- Price (and other) Discrimination
- Thomas Heath, Washington Post, Capitals
Owner Puts Pittsburgh Fans on Ice (Apr. 14, 2001) (2001
- Linda Rosencrance, Amazon
charging Different Prices on some DVDs (Sept. 5, 2000)
- Florian Zettelmeyer, Fiona Scott Morton & Jorge
or Cowards: Why are Internet Car Prices Lower? (Oct. 2001) (abstract
- Fiona Scott Morton, Florian Zettelmeyer, & Jorge
Information and Price Discrimination: Does the Internet Affect the
Pricing of New Cars to Women and Minorities? (Sept. 2001) (abstract
- Hal R. Varian, New York Times, Online
Sales Offer Fresh Look at Economy (Dec. 19, 2002)
- Sample Hazards
- Matt Gallaway, Business 2.0, Amazon's
Privacy Woes (Dec. 12, 2000)
- Wired.com, Schwab
Online Breaks Down (Feb. 24, 1999)
- John Schwartz and Bob Tedeschi, New York Times, New
Software Quietly Diverts Sales Commissions (Sept. 27, 2002)
Optional reading [not included in your packet - on
reserve in the library]
- Mark S. Nadel, The Consumer Product Selection Process in an
Internet Age: Obstacles to Maximum Effectiveness & Policy Options,
14 Harv. J.L. & Tech. 183 (2000). Updated 2001 version can be downloaded
- Voyeur Dorm L.C. v. City of Tampa, FL, 121 F.Supp.2d 1373
(M.D.Fla. 2000) (westlaw),rev'd
265 F.3d 1232 (11th Cir. 2001).
- Saul Hansell, A
Front-Row Seat as Amazon Gets Serious (May 20, 2001)
- Reuters, Amazon
apologizes for random price test (Sept. 28, 2000)
- Blaise Cronin & Elisabeth Davenport, E-Rogenous Zones:
Positioning Pornography on the Internet, 17 The Information Society 22
(2001) [not online]
- Read the full text of the two Florian Zettelmeyer, Fiona Scott
Morton & Jorge Silva-Risso articles above
- Look up today's Priceline Stock Quote
-- and then trace its historical performace. Is this performance
consistent with what we read about Priceline?
- To what extent do the various strategies motivating these
merchants depend on the public not being aware of all or part of what
the merchant is doing?
- For each of the readings, imagine you are approached by a
person who didn't get something they wanted, or thinks someone else got
a better price or a better deal, or thinks the merchant shouldn't be
allowed to do that..
- Any legal grounds for either an individual or a class action
- If not, is new legislation or regulation needed? If so,
who should solve the problem? Should these new rules be state,
federal, or international?
4. Digression: Totally
- Elizabeth Kolbert, The New Yorker, Pimps
and Dragons (May 28, 2001) [Links to this article have a tendency to
die. Can you figure out why?]
- Edward Castronova, Virtual Worlds: A First-hand Account of
market and Society on the Cyberian Frontier (Dec. 2001) (I have given
you the short version in the packet. Here is a link to the long
End User License Agreement
- Ultima Online
- Out of band sales
- Matt Slagle, AP, Bucks for
Bytes: Gamers Buy, Sell Virtual Characters (May 24, 2002)
- Player Auctions Web
- 60 Warrior!
- Sandy Brundage, Gamers.com, PlayerAuctions.com - Safe
Haven for MMORPG Players? (Nov. 10, 2000)
- Greg Sandoval, News.com, Sony to
ban sale of online characters from its popular gaming sites
(Apr. 10, 2000)
- David Becker, News.com, Game Exchange
Dispute Goes to Court (Feb. 7, 2002)
- Ultima Online
Service Rules of Conduct
- Utlima Online: Purchasing and Owning A House
- Utlima Online: Secure House Trading
- Utlima Online: How Do I Know What is "Legal" in UO?
- Utlima Online: Exploitation
- Utlima Online: Scam Prevention
- David Becker, News.com, Online Gaming's
Cheating Heart (June 7, 2002)
- Edward Castronova, On Virtual Economies (July 2002) [pages 1-5,
- Michelle Levander, Time Magazine, Where Does Fantasy End? (June
- How long until Ultima Online introduces its version of the UCC?
- Thor78 has spent hours accumulating powerful magical goods in
EverQuest, which Thor78 planned to sell on Flea-Bay to raise money for a
parental wedding anniversary gift. Flea-bay has stopped sales of
EverQuest items at Sony's request, pointing to its policy of "removing
items for sale that are identified as intellectual property that is
being unlawfully sold." Thor78 wants to sue someone and HURT
them. Has she got a valid claim against anyone?
- EverQuest's owner, Sony, objects to out-of-game trading of
characters and objects. In contrast, Ultima Online allows the
trading of characters and even has a form people can use to record the
conveyance of a character. What are the advantages and disadvantages of
- Alice swindled Bob out of valuable magic items in Ultima
Online. Can Bob sue Alice in state court?
- Carol killed Ted's super-Elf in violation of the Everquest
rules. Can Ted sue in state court?
- David sold a Ring of Great Power to Ed via E-bay for $1400.
It turns out the ring is a dud. Does Ed have any recourse?
- To what extent are MMORPG's [Massively Multiplayer Online
- labs for e-commerce experiments
- sources of new wealth
- different from "meatspace" in ways that make their behavior
only a curiosity
5. Introduction to E-Fraud
- National White Collar Crime Center & FBI, IFCC
2001 Internet Fraud Report (pp. 3-11 & 15-20)
- IFCC, Nigerian
Letter Scams (Dec. 18, 2002)
- Hal R. Varian, New York Times, Managing
Online Security Risks (June 1, 2000)
- Organisation for Economic Co-operation and Development (OECD), Recommendation
of the OECD Council Concerning Guidelines for Consumer Protection in the
Context of Electronic Commerce (1999)
- SEC v. Colt, Complaint
(Mar. 2, 2000)
- Compare SEC v. SG Ltd., 142 F. Supp. 2d 126 (D. Mass.
verison), with SEC
v. SG Ltd. 265 F.3d 42 (First Cir. 2001) (Westlaw
- Iopus.com, Password
- Yougu Yuan, Eileen Zishuang Ye & Sean Smith, Web
Spoofing 2001 (July 2001)
- Funny -- Anti-419 scam games at Quatloos
- Brendan I. Koerner, Slate.com, The
Nigerian Nightmare (Oct. 22, 2002)
- Todd S. Corey, Catching
On-line Traders in a Web of Lies: The Perils of Internet Stock Fraud
- Jonna Glasner, Wired.com, They Price
Laundered Money (June 1, 2000)
- SEC, Top
Ten DotCons (Oct. 30, 2000)
- FTC, Bureau of Consumer Protection, Consumer Protection in the
Global Electronic Marketplace: Looking
Ahead (Sept. 2000) (long)
- SEC v. Donald Allen English (E-biz), Complaint
(Jan. 31, 2001); Emergency
Motion to Modify Freeze Order (Jan 31, 2001)
- Try the Web
- What, if anything, do the OECD Guidelines require anyone to
do? Do the OECD Guidelines differ in any way from current US law
- Are Internet frauds likely to be any different than
garden-variety frauds? How?
- If there is a difference, what if anything can be done about
- Might Internet-based frauds require special regulation even
if they are basically just the same old thing, or are existing rules and
techniques likely to be sufficient?
- Does your analysis of the problems and solutions change
much if the parties are in different countries?
- Are Internet users more likely to be susceptible to fraud
online than in other parts of their lives? Less likely? Why?
- How security conscious are you when you use the Internet?
- Imagine some malicious uses for the Iopus.com password recovery
product and the Web Spoofer.
- How does one tell a fraud from a toy or the next Big Thing?
6. Some Other Perspectives
- A. Michael Froomkin, The
Death of Privacy?, 52 Stan. L. Rev. 1461 (2000) (edited, shorter,
version in packet)
- J.D. Lasica, Online Journalism Review, Search Engines
and Editorial Integrity (July 23, 2001)
- Mitchell L. Moss & Anthony M. Townsend, 16 The Information
Society 35, The
Interent Backbone and the American Metropolis (2000)
- Joan T.A. Gabel & Nancy Mansfiled, On the Increasing Presence of Remote
Employees: an Analysis of the Internet's Impact on Employment Law as it
Relates to Teleworkers, 2001 J. L. Tech. & Pol'y 233 (Westlaw)
- Lawrence H. Summers, Tax
Administration in a Global Era (July 10, 2000)
- Arthur J. Cockfield, Designing
Tax Policy for the Digital Biosphere: How the Internet Is Changing Tax
Laws, 34 Conn. L. Rev. 333 (2002) (Westlaw)
[pages 333-46, 351-52 & 359-80]
- Pamela Samuelson, Five
Challenges for Regulationg the Global Information Society
- Luz E. Nagle, E-Commerce in Latin America: Business and Legal
Challenges for Developing Enterprise, 50 Am. U. L. Rev. 859 (Spring
2001) (should be available from Am.
U. L. Rev. soon)
- Jukka Heinonen, The Warsaw Convention Jurisdiction and the
Internet, 65 J. of Air L. & Comm. 453 (2000) (westlaw)
- Helen Nissenbaum, Securing
Trust Online: Wisdom or Oxymoron?, 81 B.U.L. Rev. 635 (2001)
- In what ways does the Internet change the marketplace?
- In what ways are consumers empowered? Dis-empowered?
Which is greater?
- What sort of spill-over effects to 'meatspace' might one be
concerned about from these effects?
- Other than whatever "embarrassment" may caused by having facts
about oneself known to others, are there any other genuinely harmful
effects from a "loss of privacy"? To what extent if any should the
law protect the (too easily?) embarrassed?
- Isn't Scott McNealy basically right?
- In my 'regulatory arbitrage' article I argued that the Internet
would not mean the end of taxes. But it seems it may mean a
substantial change -- what sort?
- Consider 42 U.S.C. sec 12181(7), which defines "public
accommodation" for purposes of the federal Americans with Disabilities
(7) Public accommodation The following private
entities are considered public accommodations for purposes of this
subchapter, if the operations of such entities affect commerce--
Is an e-commerce web site for an auction house or an airline a "public
accommodation" subject to the ADA? (Cf. Access now v. Southwest
Airlines Co., 2002
WL 31360397 (S.D. Fl. 2002) for one answer.)
(A) an inn, hotel, motel, or other place of lodging, except for an
establishment located within a building that contains not more than five
rooms for rent or hire and that is actually occupied by the proprietor
of such establishment as the residence of such proprietor;
(B) a restaurant, bar, or other establishment serving food or drink;
(C) a motion picture house, theater, concert hall, stadium, or other
place of exhibition or entertainment;
(D) an auditorium, convention center, lecture hall, or other place of
(E) a bakery, grocery store, clothing store, hardware store, shopping
center, or other sales or rental establishment;
(F) a laundromat, dry-cleaner, bank, barber shop, beauty shop, travel
service, shoe repair service, funeral parlor, gas station, office of an
accountant or lawyer, pharmacy, insurance office, professional office
of a health care provider, hospital, or other service establishment;
(G) a terminal, depot, or other station used for specified public
(H) a museum, library, gallery, or other place of public display or
(I) a park, zoo, amusement park, or other place of recreation;
(J) a nursery, elementary, secondary, undergraduate, or postgraduate
private school, or other place of education;
(K) a day care center, senior citizen center, homeless shelter, food
bank, adoption agency, or other social service center establishment;
(L) a gymnasium, health spa, bowling alley, golf course, or other place
of exercise or recreation.
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To Syllabus Index
Last modified: Dec. 19, 2002
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