Fatwallet, an online service that collects and compares sales prices from Walmart, Staples, Best Buy, and Target, has been told to stop by those retailers because the practice is in violation of the DMCA. "We don't think sales prices can be copyrighted, or that the DMCA was meant for this type of thing," said Tim Storm, Fatwallet's owner. "But it would cost us a heck of a lot of money to be right." He is complying with the request "as a business decision."
This is a very different tactic from eBay's, when Bidder's Edge grabbed data from eBay's auctions. In that case, eBay argued using the "trespass to chattels" defense, saying that Bidder's Edge was occupying their servers with webcrawlers, thereby depriving eBay of use. BE was prohibited from taking eBay data using automated queries, but they were not barred from going to the site manually and obtaining data. Since data cannot be copyrighted, it seems a stretch that Walmart is claiming copyright over sales prices they publish publicly.
Posted by Mary Hodder at November 21, 2002 06:57 AMAs I understand it, this is about information that has yet to be published, as opposed to information already on the web. Still and all, it has very interesting implications for journalists who get this kind of information in advance, and then scoop it - what if this same information were published in the retail trade press, on thier site?
Posted by: John Battelle on November 21, 2002 04:25 PMAnd this information is about sales the store is planning on having, posted to shopping-related discussion groups. Isn't this just free promotion?
Posted by: Stephanie Hornung on November 21, 2002 10:42 PMChilling Effects' Eddan Katz does a really good write up off the situation in "Bargain Shoppers Chilled by Retailers' DMCA Threats", explaining in detail the problem with users posting the stores' sales information in advance, the FatWallet owner's reluctance to fight, thereby removing the user's posting of the sales information, as well as the issues around copyrighted data and the trademark problem. The stores have succeeded even if they are in the wrong, because the sales data has to do with Black Friday, the big shopping day after Thanksgiving, only a few days away. And yes, it is free promotion for the stores. But apparently the stores are worried about competitors getting their sales data and reacting by adjusting prices lower. According to Michael Porter's Harvard Business Review, March 2001 article on "Strategy and the Internet", the problem with the internet and sales pricing is that there is a lot of information for consumers to compare pricing, and this results in a race to the bottom. The stores may be reacting to this, looking for whatever they can to prevent a downward spiral of pricing.
There is another case, CDN v. Kapes (1999) where the 9th Circuit Court affirmed the District Court's assessment that CDN's price guides were not facts, but instead were "wholly the product of [CDN's] creativity. The evidence indicates that the plaintiff uses its considerable expertise and judgment to determine how a multitude of variable factors impact upon available bid and ask price data. And it is this creative process which ultimately gives rise to the Plaintiff's 'best guess' as to what the current 'bid' and 'ask' prices should be. As such, the Court finds that these prices were created, not discovered." [District Court Order Granting Summary Judgment, February 5, 1998.]
Here are more articles about FatWallet: NYTimes, Register.
Posted by: Mary Hodder on November 23, 2002 03:49 AMDo you really think these are "trade secrets"? How easy was this information to obtain? Everyone had the info from multiple sources for all the retailers.
Are they really protecting this information? If it's this easy to get this information, don't the competitors already know the "secrets" even without it being posted all over the net?
I would bet that all the retailers involved already had this sort of information from their own "research" departments.
This is really another case of the major retailers flexing their muscle and might against the average American.
Thought this would be of interest to you. Today, the Samuelson Law, Technology & Public Policy Clinic at Boalt Hall, along with Gray Matters, on behalf of FatWallet sent letters to the retailers contesting their frivolous copyright assertions and demanding payment, under Section 512(f) of the DMCA, for all damages, including costs and attorneys’ fees, incurred by FatWallet in addressing the knowing and material misrepresentations of copyright protection.
In addition, FatWallet has demanded that Wal-Mart withdraw their pending subpoena, under Section 512(h) of the DMCA, for identifying information on the individual who posted Wal-Mart sales information. If Wal-Mart does not withdraw FatWallet will seek to quash it in federal court.
Posted by: Deirdre Mulligan on December 2, 2002 02:00 PM