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Wednesday, May 1, 2013

Court Dismisses Craigslist Suit Against Competitors

Craigslist does not have exclusive licenses to the postings on its classified advertising Web site, a federal court ruled on Tuesday.

Craigslist alleged last year that the listings Web sites PadMapper and Lovely, as well as 3Taps, a company that collects public data and organizes it for the use of developers, were infringing on its copyright and trademark. Craigslist also made a number of other piracy-related claims against the trio and asked the court to shut them down.

But Judge Charles R. Breyer of United States District Court for the Northern District of California dismissed the charges on Tuesday. Craigslist’s terms of use do not give it an exclusive license to customers’ data, he said in his ruling, and without an exclusive license, the company cannot sue for infringement.

In a blog post on the 3Taps Web site, Greg Kidd, the company’s chief executive, wrote that the ruling would allow new start-ups to create search options for customers, and that developers would be able to “confidently continue to focus on innovation rather than litigation.”

The legal battle isn’t over, however. The court declined to dismiss an additional case by Craigslist that accuses 3Taps of violating the Computer Fraud and Abuse Act by siphoning listings from search engines. Craigslist did not respond to a request for comment.

As I wrote in a column last year, Craigslist has long promoted itself as a listings company that hopes to make the world a better place. But it uses tough legal tactics to guard its business. Dozens of small Web sites that have used Craigslist data have received cease-and-desist letters from Perkins Coie, a corporate law firm that frequently represents Craigslist.

The legal battle with PadMapper, Lovely and 3Taps is a rare example of smaller companies holding their ground against Craigslist. In the past, the listings giant has greeted start-ups with intimidating legal threats, and the tactics often worked. Craigslist’s lawyers have managed to shut down sites like Craig’s Little Buddy, which allowed users to search multiple Craigslist cities at once; Craigsly, which helped people set up e-mail alerts for a certain type of listing; and Ziink Craigslist Helper, which offered a free browser plug-in that made navigating listings easier.

But Craigslist has not always gotten its way. In September, 3Taps fought back and filed an antitrust claim accusing Craigslist of anticompetitive business practices. The claim is expected to go to trial later this year.

In Tuesday’s ruling, the court also upheld a controversial but temporary addition to Craigslist’s terms of service. The language, which was removed after three weeks, said Craigslist owned any facts or descriptions in ads posted on the company’s Web site. Post the same ad somewhere else and you could be accused of stealing content from Craigslist, even if you were the person who placed the original ad.

Although the court upheld that language, privacy groups accused Craigslist of taking advantage of customers. In a blog post for the Electronic Frontier Foundation, a digital rights advocacy group, Kurt Opsahl, a senior staff lawyer, argued that Craigslist had used “oppressive” terms to gain ownership of customers listings last year.

“Did you post an ad on Craigslist between July 26, 2012, and August 8, 2012?” the blog post asks. “If so, bad news for you. Turns out that Craigslist, and not you, owns that ad. In other words, if you try to repost it to another site, you could actually be infringing Craigslist’s copyright. Sound ridiculous? We think so, too.”