LinkedIn Pushed Back – For Now

Data is king on the Internet. Of course, real commerce does occur via the Internet in huge and increasing volumes and SaaS offerings are proliferating, but no matter what activities are occurring, valuable user data is always being collected, aggregated, analyzed and often monetized. So much so that you can be certain that wherever you find a useful free online service, you will also find immense data collection and monetization. So, in effect, in such cases, you and your data become the product.

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It should not be surprising that when one website massively and successfully gathers valuable user data, you will find others that want to access and use that data. The primary means of gaining such access are either licensing or scraping. Licensing is with permission and usually comes with a fee. Scraping is usually without permission, is legally risky and is free.

So, what is the state of the law on data scraping?

In August, the United States District Court for the Northern District of California, in hiQ Labs, Inc. v. LinkedIn Corporation, may have broken new ground enhancing the rights of data scrapers (or maybe not), but first let’s examine the legal issues involved.

Potential legal violations of data scraping

In order to evaluate the risk versus benefit of a data scraping business model, it is necessary to understand the potential legal violations that might occur.

  1. Computer Fraud and Abuse Act (CFAA). The CFAA is a federal statute that imposes liability on someone who “intentionally accesses a computer without authorization or exceeds authorized access, and thereby obtains…information from any protected computer.” A determination of liability under the CFAA will usually focus on whether the data scraper has actual or constructive knowledge that the terms governing access to the website prohibit the data scraping activity. Establishing knowledge of the user often depends upon how explicitly the website terms of service prohibit data scraping and whether the user is legally bound by the terms of service (i.e., was it a clickwrap or browsewrap acceptance?) and if not accepted whether the applicable terms of service were conspicuous enough to amount to constructive knowledge. Violations of the CFAA can be punished by fines and prison. 
  2. Breach of Contract. If a user is bound by terms of service that clearly prohibit data scraping, and a user violates such terms, then the user is in breach of the terms of service. Such a breach can be the basis for prohibiting the user from continuing to access and scrape data. Whether or not such a breach of contract would result in liability to the user will depend upon whether the website can establish that it incurred damages as a result of the breach. 
  3. Copyright Infringement. The data scraping process by definition involves removal of content from a website. If the content is protected by copyright, and the terms of service do not allow such copying, then the data scraper would be guilty of copyright infringement. Copyright infringement claims can result in high damages under the U.S. Copyright Act, including statutory damages of up to $150,000 per violation for intentional infringement, payment of legal fees, and granting of an injunction. 
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