Craigslist Wins Copyright Suit

Craigslist won a landmark $60.5 million judgment on April 13, 2017 against RadPad, Inc. RadPad became insolvent during the course of litigation, making it doubtful Craigslist will ever collect this hefty judgment. However, this case will serve as a serious warning to others of the potential penalties for web scraping.

The Lawsuit

RadPad was founded in 2013 for the purpose of helping users find rentals and to process rent payments. Rather ironically, RadPad was named “App of the Year” by FbStart in 2015.

Craigslist alleged RadPad stole or “harvested” Craigslist users’ contact information for RadPad’s own business purposes. RadPad sent approximately 400,000 emails to Craigslist users, encouraging them to use RadPad.

What is Web Scraping?

Web scraping (or web harvesting) has been around since the 1990s. Large volumes of data are extracted and stored by specialized software, without the website owner’s knowledge or permission. Typically, web scraping is used by a new business to grow their business at an accelerated rate, at the expense of an established business.

Web Scraping – Some Legal Challenges

Could one business legally scrape vast amounts of data from another? During the 1990s, the legality of web scraping was frowned on, but not legally prohibited. The legal standing of web scraping slowly began to change.

• • In 2000, Ebay accused a company of scraping data from their website, filing a preliminary injunction.

• • In 2001, a travel agency sued a competitor for scraping pricing information and using the data to undercut their prices, costing the agency customers and income.

• • In 2010, a software engineer wrote a program to crawl Facebook, collecting information on about 220 million Facebook users, resulting in about 500,000 visits to the engineer’s website.

There are several legal theories related to web scraping or automated data collection.

• • Copyright infringement

• • Breach of contract

• • Computer fraud and abuse

• • Misappropriation of hot news

• • Trespass to chattels

One of the biggest problems businesses face is determining who is actually harvesting their data. The perpetrators could literally be anywhere in the world.

The Judge’s Ruling on Craiglist v. RadPad

The judge awarded relief to Craigslist in what was essentially a default judgment.

• • $40 million in CAN-SPAM damages: The court found that RadPad’s 400,000 emails contained misleading and false header and subject information.

• • $20.4 million was awarded for copyright infringement: Craigslist had previously changed their terms of service, giving them exclusive rights to user content.

• • $160,000 was awarded for breach of contract.

• • Injunctive relief: RadPad was enjoined from accessing or distributing any of Craiglist’s user content.

In this case, the court made a strong statement that web scraping is not legal and will be penalized. Unfortunately, web scraping tools are widely available, so undoubtedly the practice will continue. However, those choosing to steal data have been put on notice that web scraping is illegal and carries a heavy penalty.

If you need help with a copyright case in Austin, TX, contact John McDuff today.