Vallade Macro

823

ADBLOCK PLUS AND THE LEGAL IMPLICATIONS OF

ONLINE COMMERCIAL-SKIPPING

Jilian Vallade*

I. INTRODUCTION

In the fall of 2007, one Web site began blocking internet users

trying to access the site while using a certain internet browser. That

Web site was JackLewis.net, run by Danny Carlton, and the internet

browser was Firefox.

1

Carlton’s blocking of Firefox users was due to

the development of a plugin called AdBlock Plus.

2

Firefox users could

install the plugin into their internet browser and, after a simple

configuration, block all internet advertisements.

3

As Noam Cohen of

the New York Times Business/Financial Desk wrote, “Adblock . . .

makes all commercial communication disappear. No flashing whack-

* Notes Editor, Rutgers Law Review. J.D. candidate, Rutgers University School

of Law–Newark, 2009; B.A., College of Social Studies, Wesleyan University, 2003. She

would like to thank her research editor, Lisa Hansen, Esq. (Rutgers ’08) and Professor

John Kettle for saving this Note from a fatal flaw early in the writing process. She

would also like to thank her mother, not only for always dropping everything else to

read the latest draft, but also for always being her first and most ardent supporter.

1. Firefox is a free internet browser provided by Mozilla Co. See Mozilla.org, How

‘Free’ is Mozilla?, http://www.mozilla.org/about/free.html (last visited Mar. 29, 2009).

2. One of the features that makes Firefox so popular with many internet users is

that not only is it a highly customizable alternative to Internet Explorer, but the

computer code that Firefox is built on is open to the public. See Jonathan Strickland &

Ed Grabianowski, How Firefox Works, HOWSTUFFWORKS, Feb. 23, 2005,

http://computer.howstuffworks.com/firefox.htm. This means that anyone with the

knowhow can use the code to tweak their Firefox experience. Id. This is most often

done by developing widgets, called plugins, which can then be installed to enhance the

overall internet experience. Id. Some of the most common plugins are search engine

extensions, which allow a user to search a Web site without having to first navigate to

the Web site. See Mycroft Project, What is a Search Engine Plugin?,

http://mycroft.mozdev.org/ (last visited Mar. 29, 2009).

3. The plugin, which was developed by Wladimir Palant, works by preventing

banner and text ads from ever loading when a user visits a Web site in Firefox. See

Paul McDougall, Firefox AdBlock Foe Calls For Mozilla Boycott, INFORMATIONWEEK,

Sept. 12, 2007,

http://www.informationweek.com/story/showArticle.jhtml?articleID=201805865.

Though Mozilla does not endorse one plugin over another, it makes all (or nearly all) of

the plugins developed by its users available for others to download via its Web site. See

Firefox Add-ons: Common Plugins for Firefox, https://addons.mozilla.org/en-

US/firefox/browse/type:7 (last visited Mar. 29, 2009). Carlton claimed that by making

AdBlock Plus available for free download, Mozilla is “tacitly support[ing] and

endors[ing]” the plugin. McDougall, supra.

824 RUTGERS LAW REVIEW [Vol. 61:3

a-mole banners. No Google ads based on the search terms you have

entered.”

4

Another reporter concurred: “the Internet has suddenly

become a quieter, more civilized, less commercial place.”

5

Carlton

countered by claiming that AdBlock Plus “deprive[d] online

publishers of legitimate revenue and allows users to steal content on

the sly.”

6

Because many Web sites, such as Carlton’s, generate an

income through online advertising, the spread of AdBlock Plus may

have a daunting effect on this business model.

7

After blocking all Firefox users, Carlton set up another Web site,

www.whyfirefoxisblocked.com, to explain his actions.

8

According to

Carlton, Firefox users were no longer allowed to access his Web site

in protest of AdBlock Plus.

9

He argued that although he could

identify which users were accessing his site via Firefox, there was no

way to tell which of those users also had AdBlock Plus installed, and

as such, his only recourse was to block all Firefox users.

10

Days later,

the ban on all Firefox users was lifted as Carlton indicated he could

now determine which users had installed AdBlock Plus.

11

Though

Carlton’s reaction may have been extreme, there has been

speculation as to the influence that software like AdBlock Plus will

have on the online-advertising business model.

Though some claim AdBlock Plus will not substantially affect

online advertising, categorizing the technology as merely a “niche

product” in a “niche browser,” there are others who are concerned

about the impact it may have on the online advertising business

4. Noam Cohen, Whiting Out the Ads, but at What Cost?, N.Y. TIMES, Sept. 3,

2007, at C3.

5. Stephen Manes, Web Ads: A Cat-and-Mouse Game: Overrun by Ads? New

Software is Better at Exterminating Them, PC WORLD, June 19, 2007, at 142.

6. See McDougall, supra note 3.

7. It should be noted that AdBlock Plus is not the only ad-blocking software

available, and Firefox is not the only browser that allows users to add an ad-blocking

plugin. See Eric Newman, Marketers Wait Before Tackling AdBlock, ADWEEK.COM,

Sept. 24, 2007,

http://www.adweek.com/aw/iq_interactive/article_display.jsp?vnu_content_id=1003645

941; Don Sheran, Pop-up Ads Get Noticed But For Wrong Reasons, SAN ANTONIO

EXPRESS-NEWS, Nov. 13, 2001, at 2. Though AdBlock Plus was made specifically to

work with Firefox, other ad-blocking software can be added to Internet Explorer as

well. See Newman, supra.

8. Anne Broach & Declan McCullagh, Web Ad Blocking May Not Be (Entirely)

Legal, CNET NEWS, Sept. 14, 2007, http://www.news.com/web-ad-blocking-may-not-be-

entirely-legal/2100-1030_3-6207936.html.

9. Jeremy Kirk, Firefox Ad-blocker Extension Causes Angst, INFOWORLD, Aug. 23,

2007, http://www.infoworld.com/article/07/08/23/Firefox-ad-blocker-extension-causes-

angst_1.html.

10. See Broach & McCullagh, supra note 8.

11. Id.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 825

model.

12

The Interactive Advertising Bureau (IAB), which lobbies for

the online advertising industry, is paying close attention to the

spread of software like AdBlock Plus and categorizes it as “an issue

that is just now ripening.”

13

According to the developer of AdBlock

Plus, approximately 2.5 million people have downloaded the product

thus far.

14

As the use of AdBlock Plus (and other similar products)

increases, both online advertisers and Web sites that derive their

income from those advertisements alike will have to decide how to

deal with a growing trend that allows users to block advertisements

from ever reaching their computer screens.

This Note examines whether the makers of ad-blocking software

can be held contributorily liable for tortious interference of a

business relationship between online advertisers and the Web sites

on which they advertise. Part II will discuss the phenomenon and

growth of internet advertising. Part III will discuss the history of

jurisprudence regarding the legality of commercial-skipping, whether

it be in television advertising or the internet. Part IV will show why

attempts to stop the spread of products like AdBlock Plus based on a

copyright infringement claim will fail. Part V will examine the

viability of a new secondary liability standard that would hold the

makers of ad-blocking software contributorily liable for tortious

interference. Finally, this Note will discuss the non-legal remedies

available to advertisers in lieu of pursuing legal action. Given the

difficulties associated with satisfying the various elements needed for

litigation, non-legal action may be the optimal choice for advertisers.

II. INTERNET ADVERTISING

There is a lot of money to be had by advertising to the internet

masses. As internet usage continues to increase among American

households,

15

many companies have diverted some, if not all, of their

advertising budget into internet advertising.

16

As of 2006, the

12. See Cohen, supra note 4; Newman, supra note 7; Tom Ryan, TiVo for the Web

Arrives, RETAILWIRE, Sept. 28, 2007,

www.retailwire.com/print/printdocument.cfm?doc_id-12470.

13. Broah & McCullagh, supra note 8. President and CEO of IAB indicated that

his organization planned to contact technology providers in an effort “to persuade

them to discourage the use of . . . software” like AdBlock Plus. Newman, supra note 7.

14. Cohen, supra note 4. Wladimir Palant, AdBlock Plus developer, also claims

300,000 to 400,000 new users download the plugin each month. Id.

15. Kenneth Hein & Todd Wasserman, As Web Matures, Sites Grow Up Too,

BRANDWEEK, June 19, 2006, at S65. Hein and Wasserman write, “Not only can many

young people not imagine life without a browser, they (along with a goodly number of

adults) are turning off the TV entirely, getting most all their news and entertainment

online.” Id.

16. Id.

826 RUTGERS LAW REVIEW [Vol. 61:3

internet was the sixth-largest advertising medium,

17

and industry

sources have reported that as television spending decreases, internet

advertising has continued to increase.

18

These same sources also

report that during the first quarter of 2007, companies spent $2.7

billion on internet advertising—an increase of 16.7%.

19

Other sources

predicted a more bullish increase: 27.8% during 2007.

20

Similarly, the

IAB reports that internet advertising generated nearly $10 billion in

revenue.

21

Greg Stuart, CEO of IAB, explained why internet

advertising continues to rise at such a soaring pace: “The steady

growth of online advertising is a clear indication that marketers

continue to believe in the opportunities and effectiveness that this

medium delivers in reaching and engaging their customers.”

22

Before the explosion of online advertising, when the internet

itself was still relatively new, many Web sites were fee-based. Users

would have to either subscribe to a Web site for continued access or

would have to pay a per-usage fee for access to information. As the

internet gained in popularity and advertisers realized the potential of

utilizing the internet to reach consumers, internet advertising

spending increased to the astronomical figures we see today.

Currently, much of the content on the internet is subsidized by

advertising; although there are some exceptions, many of today’s

Web sites are based on this business model.

23

Indeed, the creator of a

Web site that exists mainly to disseminate information, but does not

sell a product or charge for its service, often turns to advertising to

defray the costs associated with running the site.

24

17. Id. (Can you id to an article?)

18. Jon Lafayette, Q1 Ad Spending Total Down, TELEVISION WEEK, June 11, 2007,

at 16.

19. Id.

20. Hein & Wasserman, supra note 15 (discussing Merrill Lynch’s estimates

regarding Internet advertising increases).

21. Press Release, Interactive Advertising Bureau, Internet Advertising Revenues

Continue to Soar, Reach Nearly $10 Billion in First Half of ’07 (Oct. 4, 2007),

http://www.iab.net/about_the_iab/recent_press_releases/press_release_archive/press_r

elease/5230. It is worth noting, however, that the IAB may have an interest in

inflating its figures, as its business is promoting internet advertising.

22. Hein & Wasserman, supra note 15, at 1.

23. See F. Gregory Lastowka, Free Access and the Future of Copyright, 27 RUTGERS

COMPUTER & TECH. L.J. 293, 294-95 (2001) (discussing three models of content

distribution and consumption). An exception to this would be Web sites that charge a

fee for access to the content within; Web sites that offer pornography are an example

of this exception. There are also Web sites that use a hybrid of the free access

supported by advertisement model as well as content that is restricted to only paying

members. The Wall Street Journal’s Web site (www.wsj.com) is an example of this

hybrid.

24. One Web site categorizes the mindset of these webmasters as such: “I offer a

service. I don’t sell a product. The only way I can get compensated for it is by

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 827

With the increase of free content available on the Web, many

users have come to have a dual belief that content should be free, yet

find the advertising that supports such content annoying or

intrusive.

25

Likewise, some internet users appear to reject the idea

that advertising is the price to pay for free content.

26

One supporter

of AdBlock Plus was quoted as saying, “[w]hen I go to a Web site, I

am not engaging in any sort of bargain with the Web master.”

27

As a result, internet users have taken to ignoring ads. One

study, which examined the positive and negative feelings

participants had regarding advertisements on Web sites, found that

consumers had a tendency to avoid Internet ads on low-interactivity

Web sites.

28

Likewise, another study investigated the propensity of

advertising.” Is Ad Blocking Ethical?, Adblock.org, http://www.adblock.org/2006/02/is-

ad-blocking-ethical/ (last visited Mar. 4, 2009); see also The Adblock.org Webmaster

Pledge, Adblock.org, http://www.adblock.org/2004/09/adblock_webmaster_pledge/ (last

visited Mar. 29, 2009) (“As a webmaster and website owner, I rely on advertising to

pay for the time and effort it takes to develop and maintain my website. For some, it’s

a living. Adblocking software that prevents my ads from being viewed eliminates my

opportunity to be compensated for my work.”).

25. See Is Ad Blocking Ethical?, supra note 24. This article lists three general but

popular reasons people often give as a reason to support ad-blocking software:

[1] I pay for my internet access, it’s my computer, I should be able to decide

what uses my bandwidth and gets displayed on my computer. I don’t want to

see ads. [2] Ads have become horribly annoying. [T]hey flash, move, jitter,

pop up, pop under. I can’t focus on the actual content that I’m reading. [3]

The Internet should be free!

Id.

26. See id.

27. McDougall, supra note 3.

28. Chang Hyun Jin & Jorge Villegas, Consumer Responses to Advertising on the

Internet: The Effect of Individual Difference on Ambivalence and Avoidance, 10 CYBER

PSYCHOLOGY & BEHAV. 258, 264 (2007). Five hundred and forty-five participants were

asked to indicate how closely the following statements represented their views on

internet advertisements:

(a) I would prefer that there are no banner ads on the web; (b) I have a

tendency to click the banner ad because it has information that I want; (c) I

would prefer that there were no pop-up ads on the web; (d) I at least once

have clicked on the banner ads that featured interesting sounds and colors;

(e) I would prefer that there were no ads on the web; and (f) I at least once

have clicked on banner ads because they featured funny animated

characters.

Id. at 262. Participants were also asked to score the following responses on a seven-

point scale ranging from “strongly agree” to “strongly disagree”:

(a) I always intentionally ignore any ads on the Web; (b) I intentionally don’t

let my eyes look at banner ads; (c) I intentionally don’t let my eyes look at

any ads on the web; (d) I intentionally don’t pay attention to banner ads; (e) I

intentionally don’t pay attention to pop-up ads; (f) I intentionally don’t pay

attention to any ads on the web; (g) I have a tendency to hate any ads on the

web; and (h) I do anything to avoid ads on the web.

Id. at 262. The results were then used to measure the participants’ attitudes towards

828 RUTGERS LAW REVIEW [Vol. 61:3

“banner blindness” among internet users, finding that users who had

a negative response towards banner ads generally felt that those ads

impeded their ultimate internet goal, such as the search for

information.

29

AdBlock Plus is a response to the growing trend of ad avoidance.

Rather than intentionally avoiding advertisements on the sites

people frequent, they now have the option of installing a program

that will automatically block the ads for them. The implications of a

product like AdBlock Plus are detrimental to the ads-for-free-content

model upon which so many sites rely. If ad-blocking software enables

the user to remove the very advertisements that make the content

they wish to access possible, marketers have no incentive to utilize

the internet in this manner.

Advertisers currently appear to be unsure of how to address the

potential impact a program like AdBlock Plus could have on Web-

based advertising. Some marketers point to the fact that AdBlock

Plus is only one of thousands of plugins available to a Firefox user as

evidence that the program will not threaten internet advertising.

30

Others, however, acknowledge the impact AdBlock Plus could have

and have opted to adopt a wait-and-see attitude.

31

Still others, like

the IAB, are quite aware of AdBlock Plus and may be contemplating

future legal action.

32

Though the IAB concedes that “[p]eople are free

to ignore ads, and they often do that,” it maintains that “when you

internet advertisements in both high-interactivity Web sites and low-interactivity

sites. Id. The purpose of this study was to assess the way people respond to internet

ads in an effort to assist advertising companies in crafting ads to which people would

positively respond. Id. at 258, 261.

29. Chang-Hoan Cho & Hongsik John Cheon, Why Do People Avoid Advertising on

the Internet?, 33 J. ADVERTISING 89, 89 (2004). The study describes “banner blindness”

as an “[i]nternet user’s tendency to avoid fixing [his] eyes on anything that looks like a

banner ad.” Id. at 89. The study also addresses the dilemma of avoiding ad clutter–

which leads to negative feelings towards internet advertisements–without reducing ad

revenue. Id. Cho and Cheon suggest that the use of more targeted advertising (opt-in

ads and keyword generated ads, for example) would reduce negative feelings towards

ad clutter without reducing revenue. See id. at 94. Furthermore, because the ads

would be more targeted, web publishers could ostensibly charge higher prices for those

advertisements, since targeted ads generally have a higher response rate. See id. at 93

n.3.

30. See Ryan, supra note 12; see also Broach & McCullagh, supra note 8. Anil

Dash, Vice President at Six Apart, Ltd., a company that creates and hosts blogging

software, says, “We’re not going to chase (them) down. If a kid wants to install a

browser and a plug-in on a browser to control their experience, we’re not going to fight

them doing that.” Broach & McCullagh, supra note 8.

31. See Ryan, supra note 12. Jenny Howell, a top-level executive at American

Honda Motor, expressed trepidation at the possible spread of AdBlock: “Although

penetration of Adblock is still quite low, conceptually, programs like Adblock are, of

course, frightening to an online marketer.” Id.

32. Id.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 829

have a third party blocking those ads, that’s the real problem.”

33

III. THE LEGALITY OF COMMERCIAL-SKIPPING

A. Sony v. Universal Studios, Inc.: Commercial-Skipping in Its

Inception

The desire to skip commercial advertising is not new, and

neither is the push by advertisers to stop this from happening. The

following explains how advertising subsidizes television broadcasts:

Advertisers typically pay the broadcasters a fee for each

transmission of an advertisement based on an estimate of the

expected number and characteristics of the viewers who will watch

the program. While, as members of the general public, the viewers

indirectly pay for the privilege of viewing copyrighted material

through increased prices for the goods and services of the

advertisers, they are not involved in a direct economic relationship

with the copyright holders or their licensees.

Because of this revenue model, the television industry has

previously opposed technological innovations that threaten to

displace or mitigate advertising effectiveness. The potential for lost

advertising revenue was one of the industry’s primary objections to

the introduction of the VCR, as they feared the ability of consumers

to record programs and watch them while skipping over

advertisements would damage the market for television

commercials.

34

Indeed, advertising shoulders the cost of providing a host of

amenities that Americans take for granted. “[T]he main reason for

the low cost of most American software––[as well as] newspapers,

magazines, television, radio––is that it’s subsidized by

advertising . . . .”

35

Therefore, advertisers base their claims on the

assumption that advertisements are the price we pay for free

content; moreover, ipso facto, avoiding commercials while continuing

to enjoy the free content is tantamount to stealing.

36

The determination of whether ad-blocking software should be

found to be unlawful will likely parallel the inquiry of whether

television-commercial skipping apparatus could be held unlawful.

33. Id.

34. D. Branch Furtado, Television: Peer-to-Peer’s Next Challenger, 2005 DUKE L. &

TECH. REV. 7, 11-12 (2005) (quoting Universal City Studios, Inc. v. Sony Corp. of Am.,

480 F. Supp. 429, 453 (D.C. Cal. 1979)).

35. Manes, supra note 5. Ironically, the author of this statement notes that the

publication in which he originally noted the prevalence of advertising subsidies was in

a magazine that was in part subsidized by advertising. Id.

36. See Adam Turner, From AdBlock Plus to Tivo – Is Blocking The Ads Stealing?,

ITWIRE, Sept. 25, 2007, http://www.itwire.com/content/view/14595/1085/.

830 RUTGERS LAW REVIEW [Vol. 61:3

The seminal Sony Corp. of America v. Universal City Studios, Inc.,

37

was the first case to consider the argument against commercial-

skipping.

In Sony, television and movie studios attempted to argue that

Sony should be held contributorily liable for copyright infringement

for manufacturing video cassette recorders, which, by virtue of

enabling users to make video cassette recordings of television

programs, would also enable them to skip over the commercials

during playback.

38

The Supreme Court, however, rejected this

argument, holding that Sony could not be held contributorily liable

for a function of the video cassette recorder that was secondary to its

legitimate, non-infringing purpose—the ability to engage in time-

shifting and record a television program for the purpose of watching

it at a later date.

39

B. Commercial-Skipping Goes Digital, But Is the Question Still

the Same?

In the years following this controversial decision, technology

continued to advance and the courts were once again faced with the

question of whether a product that enabled a user to skip

commercials was in violation of copyright laws. This time the product

in dispute was a digital video recorder (DVR).

40

As the popularity of

the DVR grew, two DVR manufacturers in particular, TiVo, Inc.

(TiVo) and ReplayTV, Inc. (ReplayTV), were criticized by advertisers

and faced legal challenges to their products.

ReplayTV had plans to include in its DVR, a feature called

Commercial Advance, which would allow viewers to automatically

skip commercials.

41

It was this feature that was the basis of a lawsuit

against ReplayTV, brought by media companies seeking to challenge

the legality of commercial-skipping.

42

It should be noted that the

37. 464 U.S. 417 (1984).

38. See id.

39. Id. at 446.

40. A digital video recorder works in the same way as a video cassette recorder,

except the program is recorded onto an internal hard drive rather than a video

cassette tape. See Suzanne Kantra Kirschner, How It Works: Personal Digital Video

Recorders, POPULAR SCIENCE, Mar. 2000, at 83. Though the ability to skip commercials

during playback was available with all VCR-recorded programs, just as it is with all

DVR-recorded programs, the ease with which one can fast forward through

commercials is arguably greater with DVRs. See infra notes 41-48 and accompanying

text.

41. Ned Snow, The TiVo Question: Does Skipping Commercials Violate Copyright

Law?, 56 SYRACUSE L. REV. 27, 36 (2005).

42. Paramount Pictures Corp. v. ReplayTV, Inc., No. CV 01-9358FMC(EX), 2002

WL 32151632 (C.D. Cal. May 30, 2002); see also Complaint at 3, Paramount Pictures

Corp. v. ReplayTV, Inc., 2002 WL 32151632 (C.D. Cal. May 30, 2002) (Civ. No. 01-

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 831

notable feature of ReplayTV’s Commercial Advance technology was

that it caused the DVR to automatically delete commercials during

recording, so that during playback, a viewer would not see any

advertisements at all during a commercial break.

43

The Court in

Sony conceded that users may choose to fast forward through

commercials during playback, and that making such a choice was not

unlawful in that it did not alter or violate the copyright of the

program as it was being broadcast.

44

The basis of the argument

against ReplayTV relied on an assumption made by the Sony Court:

that systematically fast-forwarding through commercials was “‘too

tedious’ an activity to truly pose a threat.”

45

Here, the plaintiffs

argued that the Commercial Advance feature made commercial-

skipping exponentially easier and therefore should be regarded as an

infringing activity.

46

They further argued that ReplayTV’s features

“attack[] the fundamental economic underpinnings of free television

and basic nonbroadcast services . . . . Advertisers will not pay to have

09358) [hereinafter Paramount Complaint].

43. “TiVo, ReplayTV's chief competition in personal video recorders, allows users to

whiz through commercials at top speed. With ReplayTV's Autoskip, it's as if there

were no commercials at all.” Jane Black, ReplayTV is Not Another Napster, BUS.

WEEK ONLINE, Feb. 6, 2002,

http://www.businessweek.com/bwdaily/dnflash/feb2002/nf2002026_6277.htm?chan=sea

rch. In the early stages of the ReplayTV manufacture, which is when the litigation

took place, the terms “Commercial Advance” and “AutoSkip” appear to be used

interchangeably. Compare Sonic Blue Inc., Guide to ReplayTV (2001)

http://www.digitalnetworksna.com/support/replaytv/downloads/ReplayTV4000UserGui

de.12.17.pdf, and Sonic Blue Inc., ReplayTV 5000 User’s Guide (2002),

http://www.digitalnetworksna.com/support/replaytv/downloads/ReplayTV_5000_UG.pd

f, with Sonic Blue Inc., ReplayTV 5500 User’s Guide (2003),

http://www.digitalnetworksna.com/support/replaytv/downloads/RTV5500_User_Guide.

pdf. The earlier versions of the DVR included either the Commercial Advance or the

AutoSkip feature, while the more current models do not.

44. See Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 450

(1984).

45. Ethan O. Notkin, Note, Television Remixed: The Controversy Over Commercial

Skipping, 16 FORDHAM INTELL. PROP. MEDIA & ENT. L.J. 899, 914 (2006) (citing Sony

Corp. of Am., 464 U.S. at 452 n.36).

It must be remembered, however, that to omit commercials, Betamax owners

must view the program, including the commercials, while recording. To avoid

commercials during playback, the viewer must fast-forward and for the most

part, guess as to when the commercial has passed. For most recordings,

either practice may be too tedious.

Sony Corp. of Am., 464 U.S. at 452 n.36. It should also be noted that early versions of

the VCR did not have the capability to allow the user to view the images as they were

being fast-forwarded; instead the screen was black during fast-forward or rewind,

which prompted the Court’s comment about guessing when the commercial has

passed.

46. Paramount Complaint, supra note 42, ¶ 2. Commercial-skipping as

infringement will be discussed further in Part III.

832 RUTGERS LAW REVIEW [Vol. 61:3

their advertisements placed within television programming delivered

to viewers when the advertisements will be invisible to those

viewers.”

47

Although Paramount Pictures Corp. v. ReplayTV, Inc. was

ultimately settled out of court, the result of the intended litigation

was that ReplayTV agreed to abandon its Commercial Advance

feature.

48

Though Tivo developed a product that had many of the

same features offered by ReplayTV,

49

Tivo escaped formal litigation

by offering to work with advertisers to study the ways in which its

users utilized the commercial-skipping features included in the

DVR.

50

What marketers appear to object to is the use of a technology to

do what most people do anyway: ignore advertisements. It is

undisputed that consumers of ad-supported television programs and

Web sites alike are free to ignore those commercials. Advertisers

would not threaten legal action if viewers chose to wash dishes

during a commercial break.

51

What, then, makes the use of

commercial-skipping apparatus—whether it be the fast-forward

47. Id. ¶ 7.

48. See Paramount Pictures Corp. v. ReplayTV, Inc., 298 F. Supp. 2d 921, 923

(C.D. Cal. 2004) (explaining that the company which purchased ReplayTV’s assets did

not include this function in its model).

49. The TiVo DVR also has the capability to skip commercials; by pressing a

particular button on the remote, users can advance the playback in 30-second

increments. See Ned Snow, supra note 41, at 37 n.86.

50. See McDougall, supra note 3 (noting that TiVo has other functions besides fast-

forwarding through advertisements); Gina Piccalo, TIVO Will No Longer Skip Past

Advertisers, L.A. TIMES, Nov. 17, 2004, at Al (noting that TIVO will assist marketers

with their market research).

51. One network executive would not agree, however. Jamie Kellner, one-time

Chairman and CEO of Turner Broadcasting (a division of AOL-Time Warner) is quoted

in an interview as saying, “Any time you skip a commercial . . . you’re actually stealing

the programming.” Mr. Kellner was willing to concede, however, that “there’s a certain

amount of tolerance for going to the bathroom.” Staci D. Kramer, Content’s King:

Jamie Kellner Controls Turner's Programming Riches. What He Does with Them Could

Speed Up—or Slow Down—the Transformation of Television, CABLE WORLD, Apr. 29,

2002, http://www.2600.com/news/050102-files/jamie-kellner.txt. This comment caused

a backlash among online-commenters; a search-engine search of “Kellner" and

"bathroom” yielded 2,100 results in 2003. Staci D. Kramer, Jamie Kellner Isn’t Against

PVRs, He Just Wants to Engage in a Smarter Debate Over Their Impact on

Programming, CABLE WORLD, Feb. 24, 2003 [hereinafter Kellner Isn’t Against PVRs].

Five years later, a search-engine search of the same terms yields 747 results. In the

year following his original comment, Kellner again met with the reporter from Cable

World to clarify his position on DVRs and their role in commercial-skipping:

I am not against PVRs. I think it's an interesting technology. The only

problem that I have is that the industry cannot continue to produce

programs as it currently does unless it is either paid for viewing the

programming, some kind of subscription model possibly, or people don't skip

the commercials.

Id.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 833

button on a VCR, Commercial Advance on a ReplayTV console, or

AdBlock Plus on the internet—any different? The difference,

marketers say, is that one is individual choice, while the other is a

“technology that enables people to kill a business model.”

52

However,

the fact that so many DVR owners report that they skip commercials

indicates that advertising is seen as an annoyance the viewers must

suffer through to get to the content they want to see.

53

Viewers want

control over what they watch, and products like ReplayTV and

AdBlock Plus give consumers that power.

IV. CONTRIBUTORY COPYRIGHT INFRINGEMENT OF A WEB SITE

There are several similarities between the arguments against

commercial-skipping of television programs, and commercial-

skipping, or advertisement-blocking, on the internet. In both

scenarios, the individual expresses a desire to systematically delete

advertisements from his viewing pleasure. Likewise, in both

scenarios, it would be impractical for advertisers to sue each

individual user.

54

Instead, the law permits advertisers to “sue a

contributor to the infringement . . . as an aider and abettor.”

55

In

order to sue a company that enables an individual to engage in ad-

blocking, it would have to be the Web site, not the advertisers, who

initiated a suit.

The current argument against commercial-skipping is based on a

theory of copyright infringement. In WGN Continental Broadcasting

Co. v. United Video, Inc.,

56

the court provided the basis for

commercial-skipping as a violation of copyright:

A copyright licensee who ‘makes an unauthorized use of the

underlying work by publishing it in a truncated version’ is an

infringer—any ‘unauthorized editing of the underlying work, if

proven, would constitute an infringement of the copyright in that

work similar to any other use of a work that exceeded the license

granted by the proprietor of the copyright.’

57

The Seventh Circuit further refined its understanding of the

(il)legality of commercial-skipping in In re Aimster Copyright

52. Black, supra note 43.

53. David Moore, Something Good to Say About TiVo, BUS. WORLD NEWS, July 9,

2002, http://www.businessworldnews.tv/html/pvr_users.html.

54. “[C]hasing individual consumers is time consuming and is a teaspoon solution

to an ocean problem.” In re Aimster Copyright Litig., 334 F.3d 643, 645 (7th Cir. 2003)

(quoting Randal C. Picker, Copyright as Entry Policy: The Case of Digital Distribution,

47 ANTITRUST BULL. 423, 442 (2002)).

55. Id. at 645-46.

56. 693 F.2d 622 (7th Cir. 1982).

57. Id. at 625 (quoting Gilliam v. Am. Broadcasting Cos., 538 F.2d 14, 20 (2d Cir.

1976)).

834 RUTGERS LAW REVIEW [Vol. 61:3

Litigation

58

: “commercial-skipping[] amounted to creating an

unauthorized derivative work, namely a commercial-free copy that

would reduce the copyright owner’s income from his original

program, since ‘free’ television programs are financed by the

purchase of commercials by advertisers.”

59

Building upon past jurisprudence, the case for contributory

copyright infringement is generally straightforward. The elements

for copyright infringement are simple; a plaintiff need only prove: “(1)

that the Plaintiff owned the copyrighted material; and (2) that the

Defendant infringed on at least one of the five exclusive rights set out

in 17 U.S.C. § 106.”

60

Here, the Web sites affected by AdBlock Plus

would allege the individual user is creating an unauthorized

derivative when he uses an ad-blocking software to remove

advertisements from the layout of the Web site.

61

To prove

contributory copyright infringement, a plaintiff would have to further

prove the defendant’s behavior satisfies the following three elements:

participation in the infringement, intent to induce to infringe, and

production of the means of infringement.

62

According to one

commentator, satisfying these elements would not be difficult;

satisfying the first element would only require the plaintiffs to

identify a direct infringer who used AdBlock Plus to block ads from

appearing on the Web site.

63

Finding an individual who accessed the

Web site in question while using AdBlock Plus should not be overly

hard, given the number of people who have reportedly downloaded

and installed AdBlock Plus.

64

Next, the plaintiff must show that the

manufacturers of AdBlock Plus had knowledge that its product was

58. 334 F.3d 643 (7th Cir. 2003).

59. Id. at 647-48 (citations omitted).

60. Perry v. Sonic Graphic Sys., Inc., 94 F. Supp. 2d 616, 618 (E.D. Pa. 2000).

61. This theory may ultimately prove faulty, however, for reasons discussed infra

notes 79-81 and accompanying text.

62. See Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159,

1162 (2d Cir. 1971); see also 3 MELVILLE B. NIMMER, NIMMER ON COPYRIGHT §

12.04(A)(3) (2008).

63. See Harlan Yu, Firefox Adblock a Contributory Infringer? (Feb. 24, 2005)

(unpublished course paper, Princeton University), available at

http://courseblog.cs.princeton.edu/spring05/cos491/?p=145. For clarity’s sake it should

be noted that although this Note uses the plugin AdBlock Plus, developed by Wladimir

Palatin, as a basis for the legal analysis, there are other products that perform the

same functions as AdBlock Plus. Specifically, the Adblock plugin mentioned in the

article cited here is not the same version of AdBlock Plus as referred to throughout the

Note, though the differences between these two plugins are negligible. For further

information, see Adblockplus.org, Frequently Asked Questions,

http://adblockplus.org/en/faq_project#adblock (last visited May 13, 2009) and

Adblockplus.org, A Not So Short History of Adblock, http://adblockplus.org/en/history

(last visited May 13, 2009).

64. See supra note 14 and accompanying text.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 835

being used to infringe upon another’s copyright.

65

If Adblock Plus had

a significant non-infringing use,

66

a plaintiff would need to show that

not only did Adblock Plus have constructive knowledge that its users

were using the product for an infringing purpose,

67

but that it

induced individuals to use its product to infringe.

68

However, because

the sole purpose of Adblock Plus is to block advertisements from Web

sites, thereby creating an unauthorized derivative, the Court in

Grokster intimated that a showing of inducement may not be

necessary,

69

and proof of constructive knowledge would be

sufficient.

70

Given the popularity of Adblock Plus—it was included in

PC World’s 100 Best Products of 2007 list

71

—it is likely that the

creator is aware that there are people who are using the program to

65. See Gershwin Publ’g. Corp., 443 F.2d at 1162.

66. The Court in Sony held that although a product may give users the ability to

infringe upon another’s copyright, as long as that ability was not the main purpose of

the product, and it had a legitimate, non-infringing purpose, the manufacturers of the

product would not be held liable for contributory infringement. See Sony Corp. of Am.

v. Universal City Studios, Inc., 464 U.S. 417, 442 (1984) (“[T]he sale of copying

equipment, like the sale of other articles of commerce, does not constitute contributory

infringement if the product is widely used for legitimate, unobjectionable purposes.

Indeed, it need only be capable of substantial non-infringing uses.”).

67. Sony made it clear that in order to find liability, it must be shown that the

manufacturer in question “sold equipment with constructive knowledge of the fact that

their customers may use that equipment to make unauthorized copies of copyrighted

material.” A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1020 (9th Cir. 2001)

(quoting Sony Corp. of Am., 464 U.S. at 439).

68. The Court in Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S.

913, 936-37 (2005) clarified its position on contributory infringement in instances

where the device in question has an infringing purpose:

We . . . hold[] that one who distributes a device with the object of promoting

its use to infringe copyright, as shown by clear expression or other

affirmative steps taken to foster infringement, is liable for the resulting acts

of infringement by third parties. . . . [M]ere knowledge of infringing potential

or of actual infringing uses would not be enough [ ] to subject a distributor to

liability.

Id.

69. Inducement can be shown by evidence of “advertisement or solicitation that

broadcasts a message designed to stimulate others to commit violations.” Id. at 937.

70. The Court does not explicitly say this, but the Court does explicitly state that

when a product has a non-infringing purpose, mere knowledge of infringing potential

is not enough to confer liability. See id. Therefore, one can infer the contrapositive;

that when a product has no non-infringing purpose, mere knowledge may be sufficient.

See also Harlan Yu, supra note 63. However, the holding in Religious Technology

Center v. Netcom On-Line Communication Services, Inc., 907 F. Supp. 1361, 1371

(N.D. Cal. 1995), appears to suggest that actual knowledge is required when dealing

with a computer systems operator in an online context. It is unclear, however, whether

a court would extend this requirement of actual knowledge to all online situations, or

whether the Grokster constructive knowledge requirement is sufficient.

71. See Eric Dahl ed., The Best 100 Products of 2007, PC WORLD, May 21, 2007,

http://www.pcworld.com/article/id,131935-page,1-c,systems/article.html.

836 RUTGERS LAW REVIEW [Vol. 61:3

block advertisements.

72

Lastly, a plaintiff alleging contributory infringement would need

to show that AdBlock Plus provided the means to infringe by making

its software available to users.

73

Plaintiffs may encounter some

difficulty in asserting that the creator of Adblock Plus has provided

users with the means to use the product, because though the plugin

is available for free, it is only available for download via the Mozilla

Web site.

74

Courts may have difficulty concluding that Adblock Plus

provided the means for infringement when the product is only

available through another’s Web site. On the other hand, however, a

court may analogize these facts to the circumstances of A&M

Records, Inc. v. Napster,

75

wherein the court found Napster

materially contributed to copyright infringement of music MP3s by

providing support services, without which “Napster users could not

find and download the music they want with the ease of which

defendant boasts.”

76

Without holding Mozilla liable, a court may

determine that by developing the plugin and making it available for

download through Mozilla, AdBlock Plus met the requirement for

providing the means for infringement.

Although the case for contributory copyright infringement

presents its own stumbling blocks for a Web site wishing to allege

infringement, there are other elements of a basic copyright claim

that a Web site may find hard to satisfy as well. An inability to

satisfy these initials elements may mean that a Web site is never

able to advance its case to the next step of proving contributory

copyright infringement.

First, as mentioned above, before a Web site would be able to

pursue an action for contributory liability, the Web site would first

have to show that copyright infringement occurred. To succeed, the

Web site owner would need to first show that the Web site was

copyrighted. This seems an obvious first step, but depending on the

type of Web site seeking to initiate a claim, this may be a significant

stumbling block. The U.S. Copyright Office has specific criteria for

the types of Web sites to which it will grant a copyright.

77

Web sites

72. See Harlan Yu, supra note 63 (discussing knowledge of infringement criterion).

73. See Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159,

1162 (2d Cir. 1971).

74. See Firefox Add-ons, http://addons.mozilla.org/en-US/firefox/addon/1865 (last

visited Mar. 29, 2009).

75. 239 F.3d 1004 (9th Cir. 2001).

76. Id. at 1022 (quoting A&M Records, Inc. v. Napster, Inc., 114 F. Supp. 2d 896,

919-20 (N.D. Cal. 2000)).

77. U.S. COPYRIGHT OFFICE, CIRCULAR 66, COPYRIGHT REGISTRATION FOR ONLINE

WORKS 1 (2006), http://www.copyright.gov/circs/circ66.pdf [hereinafter COPYRIGHT

REGISTRATION IN ONLINE WORKS]. A registration for an online work will only extend to

the “copyrightable content of the work as received in the Copyright Office and

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 837

that are not static, but are not updated frequently either, may find

copyright protection elusive as regulations require each site revision

or update to be filed as a new registration (to be accompanied by an

additional filing fee).

78

Assuming, however, the Web site is able to obtain a copyright,

the next hurdle would be to show that any advertisements (or space

reserved for advertisements) included in the Web site ought to be

covered by the copyright. There are several obstacles to proving this

element. In an informational pamphlet provided by the U.S.

Copyright Office to educate the public on how to obtain a copyright

for online works, the Copyright Office clearly distinguishes between a

computer code that is used to format the text and design of a site and

the content generated by that code.

79

The code can be copyrighted,

while the content cannot.

80

The implications for this limitation is that

Web sites may not be able to successfully argue that the space set

aside for advertisements is copyrightable.

81

Though the criteria

needed to portray AdBlock Plus as a contributory copyright infringer

identified as the subject of the claim.” Id.

78. Id. at 2. The Copyright Office makes a distinction between two types of

revisions: serials and newsletters. A serial registration may be obtained for works that

are published weekly or less often, while a newsletter registration may be obtained for

works that are published more often than weekly. Id. One caveat however, is that

registration for serials is only allowed if the weekly publication is part of a “collective

work.” Id. The Copyright Office does not consider electronic journals that publish

articles one at a time to be part of a “serial.” Id; see also U.S. COPYRIGHT OFFICE,

CIRCULAR 62, COPYRIGHT REGISTRATION FOR SINGLE SERIAL ISSUES (2008),

http://www.copyright.gov/circs/circ62.pdf. This means that Web sites like The New

York Times (www.nytimes.com) and Vanity Fair (www.vanityfair.com), for example,

are likely to be covered under serial or newsletter copyrights, while other Web sites,

like personal blogs or occasionally-updated sites may not.

79. See COPYRIGHT REGISTRATION IN ONLINE WORKS, supra note 77, at 1-2.

For a claim in a computer program that establishes the format of text and

graphics on the computer screen when a Web site is viewed (such as a

program written in html), registration will extend to the entire copyrightable

content of the computer program code. It will not, however, extend to any

website content generated by the program that is not present in the

identifying material received and that is not described on the application.

Id. at 1 (emphasis added).

80. See id.

81. There appears to be a dearth of case law addressing this specific topic,

however, inferences can be made from somewhat similar analyses. The court in Crown

Awards, Inc., v. Trophy Depot, No. 03-CV-2448, 2003 U.S. Dist. LEXIS 25205, at *35-

42 (E.D.N.Y. Sept. 3, 2003) considered whether Trophy was liable for copyright

infringement when it created a Web site that had similar design features and stylistic

layout as the Web site operated by Crown Awards. Here, the court was not considering

whether Trophy’s Web site was an unauthorized derivative, but whether the site was

an unauthorized copy. See id. at *9-10. For the purposes of this analysis, however, the

findings of the court support an inference that the layout of a Web site is not part of

the copyrightable content.

838 RUTGERS LAW REVIEW [Vol. 61:3

appears to be straightforward, or even simple, the difficulties in

proving the Web site has the appropriate standing to make such a

claim may prove to be an insurmountable hurdle.

V. TORTIOUS INTERFERENCE AS A CAUSE OF ACTION

As discussed above, there has yet to be any litigation that alleges

liability on the part of the makers of ad-blocking software.

82

Given

the possible difficulties in having a Web site sue for contributory

copyright infringement, this section will explore whether tortious

interference could be a viable theory of liability instead. In order to

explore this speculation fully, it would be useful to have a

hypothetical situation from which to apply the facts to the elements

of the tort. To that end, I have designed a hypothetical scenario,

based in part on the aforementioned and the speculations of the

articles mentioned above, that would provide the basic facts requisite

to assess the viability of a claim of tortious interference.

Imagine that Apple, Inc. wants to advertise its latest version of

the iPod mp3 player. The company knows that the Internet is a

growing medium for advertisers.

83

In this instance, Apple wants to

place advertisements on MySpace.com. While access to MySpace is

free, users must also agree to a terms of service agreement.

84

Included in the terms of service agreement is the stipulation that the

user will not block any of the advertisements contained on the Web

site.

85

Apple contacts the MySpace advertising department and buys

an advertising plan that would embed its advertisements on every

page of the MySpace Web site. Apple agrees to purchase a skyscraper

ad for $5,000.

86

The advertisement will be displayed on the Web site

500,000 times before expiring.

87

82. See supra Part 0.

83. Internet advertising has grown from 0.8% in 2000 to 5.5% in 2006. Bradley

Johnson, TV Still Rules, But the Net is Showing Gains, ADVERTISING AGE, June 25,

2007, at S-6.

84. See MySpace New Account Registration,

http://www1.myspace.com/index.cfm?fuseaction=join (last visited Mar. 29, 2009).

85. The Terms of Service Agreement reads: “Prohibited activity includes, but is not

limited to: . . . covering or obscuring the banner advertisement on your personal profile

page, or any MySpace.com page via HTML/CSS or any other means.” MySpace Terms

of Use Agreement, http://www.myspace.com/index.cfm?fuseaction=misc.terms (last

visited Feb. 28, 2009).

86. MySpace.com does not make its advertising rates available from its Web site.

For the purposes of this hypothetical, references to advertisements and rates will refer

to the advertising information published on www.gawker.com/advertising/rates (last

visited Mar. 29, 2009). Skyscraper ads are tall ads that run the length of the page. See

Gawker Advertising, http://advertising.gawker.com/specs (last visited Mar. 29, 2009).

They are usually 160 x 600. Id.

87. See Gawker Advertising, www.gawker.com/advertising/rates (last visited Mar.

29, 2009), as an illustrative example.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 839

There is a symbiotic relationship between the Web site and the

advertiser that must be attained for this advertising plan to reach its

potential. Specifically, MySpace must be able to ensure that its users

will see the ads that Apple has bought. If MySpace users are also

Firefox users who have installed the AdBlock Plus plugin, Apple’s

intended advertising plan is destined to fail. Apple purchased an

advertising plan with the intention that it would be viewed 500,000

times. If Apple has reason to believe that its ads are being blocked by

AdBlock Plus, it may decide to refuse to pay MySpace any remaining

balance for the advertising campaign. MySpace could then claim that

Apple breached its contract, and also allege that AdBlock Plus

tortiously interfered with its contract with Apple.

The question presented here is whether New Jersey-based Web

site owners can sue the makers of ad-blocking software for

contributory tortious interference in an effort to stop this practice

from continuing—and spreading.

The basis for contributory liability would be the same in a

tortious interference cause of action as it is for copyright

infringement—it would be more expedient to pursue legal action

against those who provide the impetus for tortious interference than

it would be to focus one’s efforts on each individual interferer.

88

Tortious interference is based on the premise that one has “[t]he

right to pursue a lawful business” and “[a]ny act or omission which

unjustifiably disturbs . . . the enjoyment of this right constitutes its

wrongful invasion, and is properly treated as tortious.”

89

Put

differently, this tort developed under common law “to protect parties

to an existing or prospective contractual relationship from outside

interferences.”

90

New Jersey recognizes two forms of tortious

interference: one claim addresses interference with contractual

relations and the other deals with situations where the plaintiff had

a reasonable expectation of economic advantage, but did not have an

enforceable contract.

91

Because, in the hypothetical situation set

forth above, the parties are engaged in a contractual relationship, the

analysis to follow will focus on the first type of tortious interference.

92

88. See supra notes 54-55 and accompanying text.

89. Kamm v. Flink, 175 A. 62, 66 (N.J. 1934).

90. Printing Mart-Morristown v. Sharp Elecs. Corp., 563 A.2d 31, 38 (N.J. 1989).

91. See Fitt v. Schneidewind Realty Corp., 196 A.2d 26, 29 (N.J. Super. Ct. Law

Div. 1963). Because the existence of a relationship with prospective economic

advantage is generally harder to prove than the existence of an enforceable contract,

many of the cases in this area have factual situations where there is an issue as to

whether the nature of the relationship between the parties rises to the level of a

relationship with "prospective economic advantage.” Id.

92. In practice, it is common for New Jersey judges to treat both causes of action as

the same. R.A. Intile Realty Co. v. Raho, 614 A.2d 167, 186 (N.J. Super. Ct. Law Div.

1992).

840 RUTGERS LAW REVIEW [Vol. 61:3

It is worth noting, however, that a plaintiff cannot allege tortious

interference with a contractual relationship, without also showing

that there has been a breach of contract.

93

Here, not only is there a

contractual relationship between Apple and MySpace, but there is

also a contractual relationship between MySpace and an individual

who is registered on MySpace and utilizes the AdBlock Plus plugin.

In this scenario, both contracts would be breached. First, the contract

between Apple and MySpace is breached when Apple refuses to pay

for ads on MySpace because it believes the ads are being blocked by

AdBlock Plus. Second, the contract between MySpace and the

MySpace user is breached when the MySpace user uses AdBlock Plus

to block advertisements on MySpace, violating the terms of service

agreement she signed when registering for the Web site.

Regardless of whether a plaintiff alleges interference with a

contractual relationship or prospective economic advantage, the

elements to prove remain the same.

94

Plaintiff must show: 1) an

existing contractual relationship or “reasonable expectation of

economic advantage”; 2) the interference was done intentionally and

with “malice”; 3) the defendant was a third party to the contractual

relationship; 4) the interference caused the breach of contract or loss

of prospective economic advantage; and 5) the interference resulted

in some damage.

95

New Jersey courts have frequently found “actionable

interference” despite a lack of evidence supporting an enforceable

contract.

96

In Printing Mart-Morristown v. Sharp Electronics Corp.,

97

the court found that Printing Mart-Morristown had established the

existence of a relationship with potential economic advantage when

it received an offer to submit a bid to vie for a contract to print

93. See Cent. Paper Distrib. Servs. v. Int’l Records Storage and Retrieval Serv.

Inc., 738 A.2d 962, 968 (N.J. Super. Ct. App. Div. 1999). In applying the facts of the

hypo discussed above to a tortious interference claim, it would be outside the scope of

this analysis to also discuss a breach of contract claim. However, it seems likely that if

Apple paid for advertisements to be displayed on the MySpace Web site, and, by virtue

of the ad blocking software, they were not, Apple could also sue MySpace for breach of

contract for non-performance. Likewise, if Apple believed its advertisements were not

being displayed on MySpace as called for in the contract, it could choose to withhold

final payment, leading MySpace to sue Apple for breach of contract as well.

94. See R.A. Intile Realty Co., 614 A.2d at 186.

95. See Printing Mart-Morristown, 563 A.2d at 37 (“For purposes of this tort, ‘[t]he

term [malice is] not being used in a literal sense, requiring ill will toward the

plaintiff.’” (quoting RESTATEMENT (SECOND) OF TORTS, ch. 37 at 5, introductory note

(1979)). Instead malice means the interference occurred without justification or

excuse. Id.; see also Michael Halebian N.J., Inc. v. Roppe Rubber Corp., 718 F. Supp.

348, 360 (D.N.J. 1989).

96. Printing Mart-Morristown, 563 A.2d at 36.

97. 563 A.2d 31 (N.J. 1989).

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 841

employee handbooks.

98

Likewise, in Louis Kamm, Inc. v. Flink,

99

the

court considered

100

a situation where the plaintiff, acting as a broker

for the sale of a theater, divulged to the defendant-seller information

regarding the identity of a prospective buyer.

101

The plaintiff alleged

that despite defendant’s promise to keep the identity of the buyer

confidential, the defendant conspired to “entice and steal from the

plaintiff [the prospective buyer] as a customer.”

102

Further, this

interference caused the plaintiff to suffer damages in the amount of

$4,500—the commission he would have otherwise earned from the

sale.

103

Here, the court believed the fact that the plaintiff had not

entered into a formal contractual relationship with either the loan

association or the prospective buyer was immaterial as to whether he

would be able to allege tortious interference.

104

Following the state jurisprudence, the New Jersey District

Court, in Michael Halebian N.J., Inc. v. Roppe Rubber Corp.,

105

reiterated the rule that a defendant will not be able to defend against

a claim of tortious interference on the grounds that the underlying

contract may be unenforceable.

106

Here, the defendant, which

manufactured rubber cove base, sold its products through a system of

authorized distributors, which would then resell the base to

retailers.

107

The plaintiff, Mr. Halebian, was not one of Roppe’s

authorized dealers, though he hoped to become one.

108

When Mr.

98. Id. at 39.

99. 175 A. 62 (N.J. 1934).

100. The plaintiff appealed from an order striking out the complaint as a sham. Id.

at 64. In reviewing the order, the court assessed the facts alleged to determine

whether the complaint was “sufficient in law.” Id.

101. Id. at 64-65. The theater was owned by the Guarantee Building and Loan

Association of the City of Newark; the defendant was the president of the Association.

Id. at 64.

102. Id. at 65.

103. Id. at 65. Plaintiff goes on to allege that, upon discovering the name of the

buyer, the defendant recognized his brother-in-law and business partner as the

brokers of the sale. The commission was then divided between the defendants. Id.

104. Id. at 69.

105. 718 F. Supp. 348 (D.N.J. 1989).

106. Id. at 360. The Court found defendant’s reliance on contrary judicial

observations was without basis and did not reflect current state law. Id.

107. Id. at 350-51. At the time of the events that led to this action, Roppe

authorized two companies, Allstate and Salesmaster, to distribute cove base in the

New York-New Jersey Metropolitan Area. Id. at 350. Co-defendant, J. Bernardo

Distributors, Inc., was also an authorized dealer of Roppe products for the designated

area of Pennsylvania. Id. at 350-51.

108. Id. at 351. Mr. Halebian wanted to become an authorized distributor because

he was unable to otherwise provide his customers with Roppe products. Id. Despite the

array of other products the plaintiff was able to provide his customers, because Roppe

cove base was known to be the “base of choice,” his customers had to take their

business to an authorized dealer if they wanted to purchase Roppe base. Id.

842 RUTGERS LAW REVIEW [Vol. 61:3

Halebian’s attempts to become an authorized dealer proved

unsuccessful, he made the acquaintance of Mr. Bernardo, owner of an

authorized Roppe dealership.

109

Together, the men decided that

Halebian would order all of its Roppe cove base from Bernardo, so

that it would have a supply for its retail customers.

110

However,

when Roppe discovered this arrangement,

111

alerted by one of its

authorized dealers,

112

Mr. Halebian alleged Roppe sought out

Bernardo and ordered it to stop selling to Halebian.

113

Among other

things, Mr. Halebian filed suit for tortious interference against

Roppe, Bernardo, and Salesmaster.

114

In their motion for summary judgment, defendants argued that

plaintiff could not satisfy the first element of tortious interference

with a contractual relationship because the plaintiff could not prove

that he had a valid contract with Bernardo.

115

The court, however,

rejected this argument, restating that “[o]ne who maliciously or

without justifiable cause induces a person to break his contract with

another will be liable to the latter for the damages resulting from

such a breach and this is so even though the contract be

109. Id. at 352.

110. Id. at 352-54. The arrangement was that Bernardo would supply Halebian

with Roppe products for a pre-arranged price. Id. at 352. Mr. Halebian testified that

though he initially told Mr. Bernardo to expect him to order 500 cartons, he did not

commit to maintaining such an order volume in the future. Id. at 353. Likewise, Mr.

Halebian also testified that he believed the arrangement to be in effect for as long as

both parties desired, but acknowledged that if Roppe were to allow him to become an

authorized dealer he would end the agreement with Bernardo. Id.

111. Mr. Halebian testified that he did not attempt to keep the arrangement a

secret. Id. In fact, he hoped not only that Roppe would discover the arrangement by

virtue of Bernardo’s increased sales, but also that Roppe, seeing how successful

Halebian was in selling their products, would allow Halebian to become an authorized

dealer. Id.

112. Id. at 354. Halebian alleges Salesmaster was alerted to the fact that Halebian

was selling Roppe products when one of its customers contacted the president, Mr.

Kurtz. Id. Mr. Kurtz testified that the customer contacted him to see if Roppe had

taken on a new distributor. Id. This customer also provided him with Halebian’s price

list for Roppe products, which matched Salesmaster’s prices identically. Id.

Salesmaster, in turn, notified Roppe that Halebian was acting as an unauthorized

dealer. Id. While the court does not believe Salesmaster requested Roppe “search for

and eliminate Halebian’s source,” the fact remains that Salesmaster viewed Halebian

as its biggest competitor. Id. at 354-55.

113. Id. at 354. Bernardo agreed to stop supplying Halebian, in part because he

could not “financially handle the volume Halebian requested.” Id. at 355.

114. Id. at 349. Defendants sought summary judgment for all of plaintiff’s claims.

Id.

115. Defendants point out that the contract was unenforceable because it was oral

and “was not to be performed within one year from its making.” Id. at 359. Plaintiff

counters this argument by noting that there was a written contract and it was to

continue indefinitely. Id. at 360; see also id. at 353.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 843

unenforceable because it is within the Statute of Frauds.”

116

A Web site plaintiff would find it easy to satisfy the first element

of this claim. In our example, Apple and MySpace clearly enter into

an advertising contract—MySpace provides the advertising space

and receives $5,000 and in return Apple pays $5,000 to have its ads

displayed 500,000 times. Likewise, MySpace has a valid contract

with the MySpace user, wherein MySpace grants the user access to

its site, and the user, among other things, agrees not to remove any

advertisements placed on the site. Though it is not relevant in this

example, courts have generally found it unnecessary for a plaintiff to

prove the existence of an enforceable contract because this tort

encompasses interference with contractual relations as well as

relations involving prospective economic advantage.

117

The second element is dual-pronged: whether the defendant

intended to interfere with the plaintiff’s business and did so with

malice.

118

The first prong of this element looks at whether the

interference was intentional.

119

For a defendant to be liable for

interference he must intend “to affect the contract of a specific

person.”

120

The court in Fineman v. Armstrong World Industries

Inc.

121

considered whether a floor-covering manufacturer, which

endeavored to keep its distributors from buying and selling plaintiff’s

videotape magazine because they intended to develop a similar

product in the future, can be held liable for tortious interference with

a prospective business relationship, when the plaintiff is suing as

both an individual and producer of the video magazine.

122

The

plaintiff’s claim was ultimately dismissed because, among other

things, he was unable to show the defendant specifically intended to

interfere with his contracts.

123

116. Id. at 360 (quoting Louis Schlesinger Co. v. Rice, 72 A.2d 197, 202 (N.J. 1950)).

117. See Harris v. Perl, 197 A.2d 359, 363 (N.J. 1964). “[I]t usually is held that

contracts which are voidable by reason of the statute of frauds, formal defects, lack of

consideration, lack of mutuality, or even uncertainty of terms, still afford a basis for a

tort action when the defendant interferes with their performance.” Id.

118. See Printing Mart-Morristown, 563 A.2d at 37.

119. See Fineman v. Armstrong World Indus. Inc., 774 F. Supp. 225, 250-54 (D.N.J.

1991), aff’d in part, rev’d in part on other grounds, 980 F.2d 171 (3d Cir. 1992).

120. Lightning Lube, Inc. v. Witco Corp., 4 F.3d 1153, 1170 (3d Cir. 1993) (quoting

RESTATEMENT (SECOND) OF TORTS § 766 cmt. P (1979)).

121. 774 F. Supp. 225 (D. N.J. 1991), aff’d in part, rev’d in part on other grounds,

980 F.2d 171 (3d Cir. 1992).

122. Fineman, 980 F.2d at 178-81.

123. Fineman, 774 F. Supp. at 250. Fineman’s complaint alleged both tortious

interference on behalf of himself and his company. Although Fineman was able to

show that the defendant intended to interfere with his company’s contracts, he was not

able to satisfy this element for his individual tortious interference claim. Id.

844 RUTGERS LAW REVIEW [Vol. 61:3

Likewise, the court in Lightning Lube, Inc. v. Witco Corp.

124

considered whether a motor oil supplier committed tortious

interference against a quick-lube franchisor when the supplier

persuaded franchisees to defect from the franchisor.

125

In affirming

the jury’s finding of liability, the court determined that Witco indeed

intended to harm Lightening Lube’s contractual relationships with

its franchisees.

126

In our example, MySpace may be successful in showing that the

makers of AdBlock Plus intended to interfere with Apple’s

advertising contract with MySpace. First, MySpace would need to

show that AdBlock Plus intended to interfere with MySpace’s

contract with the MySpace user to refrain from removing ads from

the site. Proving specific intent in this case may be difficult since

AdBlock Plus does not target any specific Web site, but removes ads

on all Web sites alike. If MySpace was successful in proving AdBlock

Plus’ role in causing the MySpace user to breach his contract with

MySpace, the Web site could then attempt to prove that, via the

MySpace user, AdBlock Plus was contributorily liable for causing

Apple to breach its advertising contract with MySpace. It is possible

that a court would be willing to accept MySpace’s argument that

AdBlock Plus caused the MySpace user to breach his contract with

MySpace, given that the purpose of the software is to intercept and

block advertisements from displaying on a user’s system.

127

A

willingness to attribute this interference as the cause for Apple’s

breach, however, may be further than a court is willing to go.

Conversely, however, the Restatement (Second) of Torts instructs

courts to “imply an intent on a defendant’s part to harm the plaintiff

to whatever extent such harm proximately resulted from defendant’s

tortious interference.”

128

At this time, it is simply unclear how a court

may assess this requirement for intent.

The second prong of this element questions whether the

defendant acted with malice. Malice, as a term of art, is defined as

“the intentional doing of a wrongful act without justification or

124. 4 F.3d 1153 (3d Cir. 1993).

125. Id. at 1167. The defendant, Witco, induced franchisees to defect by leading

franchisees to believe the franchisor did not own the equipment in use; offering to

supply the franchisees with free equipment even though the franchisor had an

arrangement with the franchisees to provide all equipment; offering to sell oil to the

franchisees directly, thereby bypassing the franchisor; and defaming the owner of

Lightning Lube. Id.

126. Id. at 1170.

127. See Vikas Sah, AdBlock Plus: Say No to Ads and Banners on Web sites,

TECHNACULAR, Feb. 23, 2007, http://www.technacular.com/2007/02/23/adblock-plus-

say-no-to-ads-and-banners-on-websites/.

128. Lightning Lube, Inc., 4 F.3d at 1170 (citing RESTATEMENT (SECOND) OF TORTS §

767 cmt. D (1979)).

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 845

excuse.”

129

It is important to note, however, that behavior that falls

under the scope of “doing business” does not rise to the level of

“maliciousness.”

130

The conduct must be “both injurious and

transgressive of generally accepted standards of common morality or

of law.”

131

To put it differently, for the behavior to be considered

malicious it must be something more than that which would be

acceptable under the “rules of the game.”

132

Because a court must

intensely scrutinize the facts as well as make inferences into the

defendant’s motivations, there is no bright-line rule as to what

constitutes malice and what does not; maliciousness can only be

determined on a case-by-case basis.

133

In Printing Mart-Morristown, the court determined that the

defendant

134

acted intentionally when he submitted false bids on

behalf of other companies in an effort to ensure that his total bid

would be lower than Printing Mart-Morristown’s.

135

As the court

states, “the clear inference . . . is that [the defendant] intended that

Printing Mart-Morristown lose the job and that his actions were

calculated to produce that result.”

136

The court found that the

defendant’s conduct was outside of the “normal [or] expected course

of practice in a contract-bidding job” and was therefore properly

categorized as malicious.

137

Similarly, the court in Lightning Lube reasoned that Witco’s

actions were malicious because they could not be explained or

129. Louis Schlesinger Co. v. Rice, 72 A.2d 197, 203 (N.J. 1950).

130. See Sustick v. Slatina, 357 A.2d 54, 60 (N.J. Super. Ct. App. Div. 1957); see also

Leslie Blau Co. v. Alfieri, 384 A.2d 859, 865 (N.J. Super. Ct. App. Div. 1978).

131. Sustick, 137 A.2d at 60.

132. Id.

133. Printing Mart-Morristown v. Sharp Elecs. Corp., 563 A.2d 31, 40 (N.J. 1989).

134. Plaintiff’s complaint was dismissed by the District Court for failure to state a

claim on which relief could be granted. Id. at 33. After the Court of Appeals affirmed

the lower court’s decision, the State Supreme Court certified the complaint as indeed

sufficient to state a claim. Id. at 47-48. The complaint alleged several counts directed

at employees of Sharp Electronics as well as Laurriet Printing and Pippert Press, both

of which are the plaintiff’s direct competitors. Id. at 33-34. The text of this Note cites

to the section of the case where the court discussed the claim of tortious interference

against Laurriet.

135. Id. at 40. The plaintiff’s complaint alleged that Printing Mart-Morristown had

a standing arrangement with Sharp Electronics for all of Sharp’s printing needs that

were within Printing Mart-Morristown’s capability. Id. at 35. When Sharp needed to

have employee manuals printed, instead of contacting Printing Mart-Morristown, the

defendant-employees opened the job for bidding and, as the plaintiff alleged, conspired

with plaintiff’s competitors (also co-defendants) to submit the lowest bid. Id. One of the

defendant-competitors submitted bids on behalf of the other two competitors without

any apparent authorization. Id.

136. Id. at 40.

137. Id.

846 RUTGERS LAW REVIEW [Vol. 61:3

justified as “an assertion of an ‘equal or superior right’ that [would

negate] the malice require[ment].”

138

Instead, the court determined

the record supported a jury inference that Witco “lur[ed] away, by

devious, improper and unrighteous means” Lightning Lube’s

franchisees and this was not acceptable practice under the rules of

the game.

139

Whether MySpace would be successful in proving AdBlock Plus

acted with malice is less clear. The requirement that the defendant’s

actions must lay outside of the scope of the rules of the game may be

the key to this element. On the one hand, the software may be

classified as being within the rules of the game. AdBlock Plus

removes ads from a user’s screen, but it does not do it in a devious or

improper way. The person who installs AdBlock Plus does so with the

knowledge that they will be installing software designed to block

advertisements. Furthermore, AdBlock Plus is offered freely and to

anyone who wants to use it. It addresses an occurrence that has been

identified as an annoyance by the public. Ultimately, ad-blocking

software may fall within the rules of the “internet advertising” game,

just as manufacturers of printer ink-refill kits for printers would

likely fall within the rules of the “printer ink sales” game. Yet, if one

applies the point of view of the Sony Court, that VCRs do not infringe

because they also have a non-infringing purpose,

140

a court may

decide that because AdBlock Plus does not have a purpose other than

to interfere with advertisements, malice can be inferred.

Third, a plaintiff must prove the defendant is a third party to the

contract. Generally, proving this element need only require the

plaintiff to show that the defendant knew that the plaintiff had an

expectation of economic advantage as a result of a business

relationship with a third party.

141

The Halebian court found the

defendant knew the plaintiff had secured access to the rubber cove

base product and, as a distributor, the plaintiff would likely

experience economic advantage.

142

The fourth element to prove is that the interference caused the

loss of prospective gain or breach of contract.

143

As the court in

138. Lightning Lube, Inc. v. Witco Corp., 802 F. Supp. 1180, 1192 (D.N.J. 1992),

aff’d, 4 F.3d 1153 (3d Cir. 1993) (citation omitted).

139. Lightning Lube, Inc., 4 F.3d at 1167 (quoting Printing Mart-Morristown, 563

A.2d at 36); accord Sustick v. Slatina, 137 A.2d 54, 60 (N.J. Super. Ct. App. Div. 1957).

140. See Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 416, 442 (1984).

141. See Michael Halebian N.J., Inc. v. Roppe Rubber Corp., 718 F. Supp. 348, 361

(D.N.J. 1989).

142. Id.

143. See Printing Mart-Morristown, 563 A.2d at 37; see also Norwood Easthill

Assocs. v. Norwood Easthill Watch, 536 A.2d 1317, 1319 (N.J. Super. Ct. App. Div.

1988).

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 847

Harris v. Perl

144

stated, “one who unjustifiably interferes with the

contract of another is guilty of a wrong.”

145

Furthermore, “[o]ne who

without justification or excuse procures A to break his contract with

B, and thereby willfully induces the breach of a legal right, is liable

for the ensuing damage.”

146

The facts of Harris v. Perl are as follows:

Harris was a real estate agent who showed the Perls a house owned

by the Cronin family.

147

The Perls visited the house on three

occasions.

148

However, unbeknownst to either Harris or Perl, between

the second and third visit, the Cronins conveyed the house to a bank

to which the Cronins owed money.

149

At some point subsequent to the

third visit, the Perls discovered that the bank now owned the

house.

150

Rather than reveal this information to Ms. Harris so that

she could commence negotiations with the bank, the Perls contacted

the bank directly to negotiate a price.

151

Upon discovering the sale

had already been completed, Ms. Harris sued the Perls for tortious

interference.

152

The Perls’ theory of defense was that Harris was

unable to prove their interference had caused her to suffer a loss

because there was no proof the bank would have been willing to deal

with her as an agent.

153

The court ultimately rejected this argument,

finding that there was no proof that the bank would have been

unwilling to deal with Harris as an agent.

154

As a result, the court

further held that the Perls could not engage the services of a broker

only to “beat[] the broker out of [her] commission by buying from the

144. 197 A.2d 359 (N.J. 1964).

145. Id. at 363.

146. Louis Schlesinger Co. v. Rice, 72 A.2d 197, 203 (N.J. 1950).

147. Harris, 197 A.2d at 361.

148. Id.

149. Id.

150. Id.

151. Id. Negotiations between the Perls and the Cronins had come to a standstill as

the Cronins did not want to accept less than $135,000, and the Perls refused to pay

more than $125,000. The plaintiff alleges the Perls suggested she take a reduced

commission in order to facilitate the sale. The Perls ultimately purchased the house

from the bank for $125,000.

152. See id. Additionally, Harris also sued the bank on the theory that Cronin was

its agent. Id. The Perls cross-claimed against the bank, claiming it had fraudulently

represented that “Cronin was not its agent.” Id. at 361-62. The trial court granted the

bank summary judgment against both the plaintiff’s claim and the defendant’s. Id. at

362.

153. See id. The Perls also argued that the bank would not have dealt with Harris

as an agent because Harris’s commission would have lowered their net gain to less

than $125,000–the lowest price they were willing to accept. Id. Therefore, the Perls

argued, the sale was not completed and, accordingly, the interference did not cause the

plaintiff any loss. Id.

154. Id. at 362-63. Furthermore, the court appeared to chastise the defendants for

basing their defense on a hypothetical situation rather than on the facts at bar. See id.

at 365.

848 RUTGERS LAW REVIEW [Vol. 61:3

owner directly or through a front, thus appropriating to [themselves]

the value of the services of the broker.”

155

The court acknowledged

that a broker’s commission is an element of a contractual

relationship a seller and a broker enter into, which comes to fruition

when the title is closed.

156

When the defendants circumvented the

broker to buy directly from the bank, they interfered with the

performance of the payment of commission.

157

Here, it seems clear

that although the intention behind the creation of AdBlock Plus is

not necessarily to interfere with a business contract between a Web

site and an advertiser, the result is the same. Should an advertiser

feel compelled to breach its contract with a Web site because it

believes its ads are being blocked, it follows that the Web site could

successfully show the ad-blocking software interfered to such a

degree that it caused the Web site to suffer an economic loss.

Finally, in a claim for tortious interference with a contractual

relationship, the last element a plaintiff must prove is that the

interference caused damage.

158

To show causation, a plaintiff must

show that “there is ‘proof that if there had been no interference there

was a reasonable probability that the victim of the interference

would have received the anticipated economic benefits.’”

159

If

causation is established, the measure of damages is the economic

advantage the plaintiff had expected to reap from the original

contract. In Printing Mart-Morristown, evidence was introduced that

indicated that Sharp Electronics Corp. was pleased with the work

Printing Mart-Morristown had previously done and whenever the

company had a printing job, it was the company’s habit to approach

Printing Mart-Morristown first.

160

This evidence was sufficient to

show that the defendants’ interference caused Printing Mart-

Morristown to suffer the loss of profit it would have gained from

securing the employee-manual printing job.

161

Conversely, the court

in Norwood Easthill Associates v. Norwood Easthill Watch

162

considered a situation where the defendant neighborhood watch

blocked the plaintiff from buying and developing a tract of land.

163

There, the court held that not only was there no indication the

155. Id. at 364.

156. Id.

157. Id.

158. Norwood Easthill Assocs. v. Norwood Easthill Watch, 536 A.2d 1317, 1320

(N.J. Super. Ct. App. Div. 1988).

159. Printing Mart-Morristown v. Sharp Elecs. Corp., 563 A.2d 31, 41 (N.J. 1989)

(quoting Leslie Blau Co. v. Alfieri, 384 A.2d 859, 862 (N.J. Super. Ct. App. Div. 1978)).

160. Id. at 35.

161. Id. at 41-42.

162. 536 A.2d at 1317.

163. Id. at 1318.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 849

defendant’s actions were the proximate cause of the plaintiff’s

inability to develop the tract of land as originally planned, but also

that the plaintiff did not suffer a compensable loss because the entire

transaction was blocked.

164

In our example, for MySpace to

successfully show that AdBlock Plus was the proximate cause of any

suffered loss, it would need to show that Apple broke its contract as a

direct result of the impact AdBlock Plus had on the advertising

campaign. Advertising campaigns generally succeed or fail for many

reasons, as opposed to one specific one. Given that there is no current

way to identify which users access a Web site with the plugin

installed, it seems farfetched that Apple would be in a position to

definitively say that AdBlock Plus was the reason for the failure of

its advertising campaign.

Overall, it is important to remember that the purpose of this tort

is to protect a plaintiff who suffered a loss at the hands of a

defendant who acted intentionally. The fact that AdBlock Plus is not

only offered freely, but also blocks all advertisements alike, may

weigh heavily against the intentionality requirement, especially

since any plausible theory of liability would be secondary in nature.

“Merely to persuade a person to break his contract may not be

wrongful ‘in law or in fact;’ but if ‘the persuasion be used for the

indirect purpose of injuring the plaintiff, or of benefiting the

defendant, at the expense of the plaintiff, it is a malicious act,

which is in law and in fact . . . a wrongful act, and therefore . . .

actionable . . . if injury ensues from it.’”

165

Here, it appears that the success of a claim of tortious

interference between MySpace and AdBlock Plus rests on a series of

inferences and assumptions that a court may be unwilling to make.

VI. THE FUTURE OF COMMERCIAL SKIPPING—IS THERE A NON-LEGAL

REMEDY?

Efforts to stop commercial-skipping through legal channels may

not be successful—curbing this practice may depend upon developing

new methods for advertisers to reach their internet audiences.

Rather than seeking a legal remedy, many advertisers have chosen to

implement a version of non-skippable advertisements in both online

and television media.

One type of non-skippable television advertisements are on-

screen crawls. Television networks traditionally display the

network’s logo in the lower left-hand or right-hand corner of the

164. See id. at 1320-21.

165. Savoy Record Co., Inc. v. Mercury Record Corp., 108 F. Supp. 957, 958 (D.N.J.

1952) (quoting Louis Schlesinger Co. v. Rice, 72 A.2d 197, 203 (N.J. 1950)).

850 RUTGERS LAW REVIEW [Vol. 61:3

screen.

166

Currently, those same networks have begun supplementing

the network logo with on-screen “crawls” promoting and announcing

upcoming shows and television events.

167

Though this practice dates

back to at least 2003, the proliferation of animated promotions of

upcoming shows within programming in recent months may be in

response to the viewer’s tendency to skip commercials.

168

The theory

is that these onscreen crawls—also called overlay graphics—will

thwart DVR users who skip commercials by embedding the

advertising content directly onto the programming itself.

169

Online advertisers, on the other hand, have taken a different

approach in developing non-skippable advertisements: Web sites that

offer online and streaming video often force the user to watch a series

of “pre-roll” commercials before the online video will begin.

170

Consumers tend to disfavor pre-rolls as much as they dislike

television commercials,

171

but advertisers continue to use them not

only because they are cheaper than creating original online

advertisements,

172

but also because they are unskippable.

173

While

166. See Television Dictionary and Research Guide, Digital On-Screen Graphic,

http://www.123exp-tv.com/t/00954331636/ (last visited May 8, 2009).

167. See Michael Russnow, Do We Really Need Those Intrusive Network Logos on

Our Screens: Do They Really Help That Much?, THE HUFFINGTON POST, Feb. 19, 2008,

http://www.huffingtonpost.com/michael-russnow/do-we-really-need-those-

i_b_87478.html. For a more in-depth discussion of the use of crawls, as well as bugs

and overlays, as an advertising tool, see John Conroy, When A Bug is Good for Your

Campaign, IMEDIACONNECTION, Nov. 2, 2007,

http://www.imediaconnection.com/content/17171.asp.

168. See Brian Steinberg, ‘Crawl Ads’ Creeping In, To Avoid Being Skipped,

Advertisers Send Their Messages Across Bottom of Screen While Programs Are on the

Air, THE BOSTON GLOBE, Mar. 28, 2009, at 8. For a discussion on ways to standardize

the use of onscreen overlays, see Guy Wright, Addressing the Overlay Graphics

Proliferation Problem, CREATIVE MAC, Jan. 4, 2006,

http://www.creativemac.com/articles/viewarticle.jsp?id=36553.

169. Kevin J. Delaney & Emily Steel, Are Skins, Bugs or Tickers the Holy Grail of

Advertising?, WALL ST. J., Aug. 13, 2007, at B1; RGB Networks Advances State-of-the-

Art in Television Advertising With Digital Overlay Capabilities, BUS. WIRE, May 21,

2007, http://findarticles.com/p/articles/mi_m0EIN/is_2007_May_21/ai_n19155302.

170. See Louis Hau, Will Video Ads Evolve?, FORBES.COM, Feb. 23, 2007,

http://www.forbes.com/2007/02/22/video-ads-youtube-tech-mediacx_lh_0223video.html.

171. Wendy Davis, ‘Pre-Roll’ Proves Best Online Video Ad Format, MEDIA DAILY

NEWS, May 23, 2005,

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=30422; see

also Andy Plesser, Pre-Roll Video Advertising is “Annoying” to Consumers, BEET.TV,

Oct. 3, 2006, http://www.beet.tv/2006/10/online_video_ad.html; Daisy Whitney, Video

Sites Sticking with Pre-Roll Ads, TVWEEK NEWS, Nov. 25, 2007,

http://www.tvweek.com/news/2007/11/video_sites_sticking_with_prer.php; Josh

Catone, Consumers Ready for End of Pre-Roll Ads, READWRITEWEB, Jan. 22, 2008,

http://www.readwriteweb.com/archives/consumers_ready_for_end_of_pre-roll_ads.php.

172. Pre-Rolls are typically repackaged television advertisements, formatted for

internet broadcast. See Whitney, supra note 171.

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 851

the fact that pre-roll advertisements are unskippable is a major

selling point for many advertisers, they are not unaware of the

public’s discontent with the format. Both Time Warner’s AOL and

NBC have both advocated for a fifteen-second standard, as opposed

to the more frequently used thirty-second spot,

174

arguing the shorter

length spots work better to minimize user irritation.

175

Ultimately,

however, the unskippable nature of pre-roll advertisements does not

address consumer ad annoyance as a phenomenon and, as such, it

would not be altogether surprising to find that in the future an

enterprising internet user has developed a way to skip these

advertisements as well.

In what seems to be an attempt to move away from the pre-roll

model, Google, Inc. announced in the summer of 2007 that they

would begin to follow television’s lead and embed in select YouTube

videos overlay advertisements.

176

Likewise, Videoegg, a company that

specializes in video advertising, also offers marketers an opportunity

to create overlay advertisements.

177

The overlay advertisements,

which are located along the bottom fifth of the screen, are eighty

percent transparent and disappear after ten seconds if not clicked

on.

178

Initial reports indicated that overlay advertisements were better

received than other forms of online advertisements, specifically pre-

rolls, which, as discussed above, have a tendency to cause the user to

abandon the video they were attempting to see.

179

Though consumers

173. Brian Steinberg, Web-Video Spots Present Dilemma for Advertisers, THE WALL

ST. J., Oct. 3, 2006, at A20.

174. Id.; see also Dan Rayburn, 15 Second Pre-Roll Video Ads Will Become the

Standard, BUSINESSOFVIDEO.COM, May 8, 2007,

http://blog.streamingmedia.com/the_business_of_online_vi/2007/05/15_second_prero.ht

ml.

175. Steinberg, supra note 173, at A20; see also Delaney & Steel, supra note 169.

Interestingly, studies show that users in the 18-35 age range express the highest

levels of annoyance at pre-roll advertisements. Catone, supra note 171.

176. Thomas Claburn, Google Puts Ads in YouTube Videos, INFORMATIONWEEK,

Aug. 22, 2007,

http://www.informationweek.com/story/showarticle.jhtml?articleID=201801805.

177. See Hau, supra note 170.

178. Kelly Fiveash, Google Will Carpet YouTube with ‘Overlay’ Ads, THE REGISTER,

Aug. 22, 2007, http://www.theregister.co.uk/2007/08/22/google_youtube_overlay_ads;

see also Pete Cashmore, YouTube Reinvents Video Ads, MASHABLE.COM, Aug. 21,

2007, http://mashable.com/2007/08/21/youtube-reinvents-video-ads/; YouTube

‘Overlays’ Ads Keying to Video Pitches, TORONTO STAR, Aug. 22, 2007, at B02.

Although Google no longer uses overlay advertisements on YouTube videos,

screenshots of a music video with overlays embedded can be viewed at

NewTeeVee.com. See Liz Gannes, YouTube’s New Inline Ads: Screenshots,

NEWTEEVEE.COM, May 11, 2007, http://newteevee.com/2007/05/11/youtubes-new-

inline-ads-screenshots/.

179. See Claburn, supra note 176 (“Google decided to use overlay ads because users

852 RUTGERS LAW REVIEW [Vol. 61:3

may tend to find television overlay ads irritating, overlays appear to

have better success in the online market. In 2006, Videoegg created

an overlay advertisement plan to promote television studio FOX’s

The O.C., wherein viewers first navigated to whatever online video

content interested them.

180

After the video they chose began to play,

the promotional ad overlay promoting The O.C. was displayed.

181

If

the viewer clicked on the overlay during playback, the video they

were watching was automatically paused and a new window opened

to play the promotional clip of The O.C.

182

If the viewer did not click

on the overlay during playback, at the video’s end, the viewer was

given the opportunity to watch the promotional material.

183

Nearly

8% of viewers clicked on the overlay, compared to 5% who chose to

watch the promotion after the video ended, compared to the less than

1% of users who chose to click on static banner ads.

184

Although it would seem that overlay ads on YouTube videos

would be a success for advertisers, it was not long before someone

developed a Firefox plugin that blocked these ads as well. TubeStop,

created by Chris Finke, stops overlay ads in YouTube videos by

launching the video in a pop-up browser, rather than playing the

video in the original YouTube.com Web site.

185

While YouTube no

longer displays overlay ads in its video content, it is unclear whether

this is a response to TubeStop or if the company abandoned the

practice for other reasons.

Initiatives like overlays and pre-roll advertisements only serve to

address the ad-blocking concerns of Web sites that offer free video

content. The majority of Web sites that are supported through

advertising but do not offer web videos are still faced with the

dilemma of counterbalancing the effect of software such as AdBlock

Plus. One solution for these Web sites may be to move towards

voluntary ad-blocking. This method would allow content providers to

continue to provide free content, while giving users the option to

register with the site (possibly for a nominal fee) to access an “ad-

free” version of the site.

186

If Web site owners made it clear why

didn’t respond well to pre-roll ads . . . . The abandonment rate was higher than Google

was willing to accept . . . . In contrast, the number of overlays closed by users was less

than 10%.”); see also Cashmore, supra note 178; Fiveash, supra note 178.

180. See Hau, supra note 170.

181. Id.

182. Id.

183. Id.

184. Id.

185. Posting of Christopher Finke, TubeStop Also Stop YouTube Ads,

http://www.chrisfinke.com/2007/08/22/tubestop-also-stops/youtube-ads/ (Aug. 10, 2007,

20:23 EST).

186. AdBlock.org, Voluntary Adblocking,

http://www.adblock.org/2004/08/voluntary_adblocking/ (last visited Mar. 29, 2009).

2009] ADBLOCK PLUS AND THE LEGAL IMPLICATIONS 853

advertisements were necessary, but offered users an opportunity to

view the content ad-free, they may find there is a substantial portion

of their audience who would be willing to register, or even pay, to

visit an ad-free version of their favorite sites.

VII. CONCLUSION

Given the nature of the Internet, there may be no legal remedy

available that can force users to watch advertisements they are not

interested in. For every new technology developed, it is likely that

there will be someone who can also develop a product to thwart that

technology. We see this phenomenon not only in technology, but in

much of today’s business. One would assume that the makers of

printer ink are opposed to countless businesses that thrive on selling

recycled ink cartridges and do-it-yourself refill ink kits. Those printer

ink manufacturers, however, would be hard-pressed to argue that a

legal wrong has been committed. The same follows for advertisers

and the makers of ad-blocking software. Marketers and the public

will always be on other ends of the spectrum where advertisements

are concerned until marketers begin to develop advertisements that

people want to see. Only then, will advertisers see the trend to use

technology to aid commercial-skipping begin to subside.