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Facebook Defends $3 Million Suit Against Rival Social Network

By Casey C. Sullivan, Esq. on December 11, 2015 10:09 AM

Facebook went before the Ninth Circuit on Wednesday to urge the appellate court to uphold a $3 million award against a now-defunct competitor, Power Ventures. In the late 2000s, Power Ventures operated the website Power.com, a social network aggregator that allowed users to access sites such as LinkedIn, Twitter, and Facebook, all in one spot.

Power.com aggressively encouraged users to sign their friends up, using information from Facebook to send out messages to users' Facebook friends. That led Facebook to sue, alleging that Power Ventures illegally accessed information on the social network's site.

Facebook v. Power

The controversy largely comes from Power.com's "Power 100" campaign. As Arsthenica explains it:

But as part of its "Power 100" campaign, Power Ventures offered its customers the chance to win $100 if they invited 100 friends to join. In so doing, Power Ventures sent messages through Facebook that came from @facebookmail.com and appeared to come from "The Facebook Team," giving the impression that they had come from Facebook itself. Facebook attempted to block this activity through an IP block, which Power Ventures circumvented. When Power Ventures ignored Facebook's requests to cease-and-desist, Facebook then filed a lawsuit in 2008.

Power Ventures was eventually found liable for violating the Computer Fraud and Abuse Act and the CAN-SPAM Act. In 2013, Judge Lucy Koh awarded Facebook $3 million in damages and enjoined Power Ventures CEO Steve Vachani from having pretty much anything to do with Facebook.

How Expansive Is the CFAA?

Now, Power Ventures and Vachani are back before the Ninth Circuit, attempting to get out of that $3 million award. The case could have a significant impact on the reach of the CFAA. The question before the Ninth is, essentially, can Power Ventures access Facebook user information on Facebook, with those users' permission but against the wishes of Facebook?

Power Ventures argues that it cannot have "stolen" data from Facebook, since Facebook was not the owner of the information. "This has nothing to do with data ownership," Power Ventures' attorney Amy Anderson, explained. "The data that was copied is the user's data. Facebook expressly disclaimed ownership to this data."

And Power's not alone. The Electronic Frontier Foundation has submitted an amicus brief arguing that Facebook's interpretation of the CFAA is "dangerous to follow-on innovators and consumers and would criminalize widely accepted Internet behavior."

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