December 2000: Legal Beat


By: Lawrence G. Walters

Vulgar website names are not protected by the First Amendment. At least that’s what U.S. District Court Judge Steven McAuliffe ruled in an adult website case recently. The case questioned whether Network Solutions could legally refuse to register names which it deemed “profane” or “vulgar.” The court ruled that domain names are more akin to signposts, and have little or no communicative value to justify First Amendment protections. This is a dangerous precedent for the Internet, which depends on Free Speech protections for its survival. This ruling may also prove problematic for companies attempting to protect intellectual property associated with their domain names like trademarks or tradenames.

Meanwhile, the battle raged over who has rights to the domain name. In the lawsuit filed in federal court, Gary Kremen alleges that his cyberspace nemesis, Steph Cohen, unlawfully deprived him of the legal rights to the valuable URL by committing fraud. The Web portal tied to the name generates tens of millions of dollars by directing online users to adult material, and has become somewhat of a “Yellow Pages” for the adult industry. Kremen’s lawyers are attempting to freeze $25 million in related assets to make sure Cohen doesn’t hide his money in offshore accounts in the event judgment is entered against him. This case also raises thorny legal issues regarding how intellectual property laws are to be applied to domain names like Earlier, the judge assigned to the case dismissed Network Solutions as a defendant, ruling that traditional property rights do not apply to a domain name since it is not considered tangible property. This case could have far-reaching implications to any owner of a domain name.

The U.S. Supreme Court, in the middle of sorting out the election mess, took time to hear arguments on a landmark Free Speech case involving an adult bookstore in Wisconsin. The City News And Novelty, Inc. v. City of Waukesha case will decide whether adult businesses are entitled to the protection of “procedural safeguards” when applying for licenses to operate from local governments. At issue is whether the City of Waukesha was required to allow the bookstore to remain in business while the courts considered legal challenges to the license renewal procedure. These procedural safeguards have been the subject of significant litigation by First Amendment lawyers on behalf of the adult entertainment industry. In 1990, the U.S. Supreme Court decided, in the case of FW/PBS v. City of Dallas, that local governments must issue a decision on license applications by adult businesses within a specified, brief time period, and must provide for prompt judicial review of a license denial. Without these safeguards, cities and counties could tie up a decision in the administrative review process indefinitely, and keep the business closed while the courts considered the challenge to the process. Most businesses would give up the fight if prohibited from opening during this process. This produced censorship by delay. First Amendment lawyers are watching the City News case very closely to see if the current Court reaffirms or takes away these important Free Speech protections.

The couple who provided links to websites containing child pornography has been found guilty of promoting child porn in federal court. After deliberating for 6 1/2 hours, the federal jury convicted Thomas Reedy on 89 counts of distributing child porn and sexual exploitation of minors. His wife, Janice Reedy, was only convicted on 87 counts. While not directly providing any images themselves, the Reedys were accused of giving subscribers access and passwords to other Internet sites displaying child pornography. Those sites were maintained by foreign webmasters. The prosecutors hope to put other similar Internet companies on notice. “I hope this verdict might scare other companies into stopping what they’re doing,” said Assistant U.S. Attorney Terri Moore. The Reedys’ lawyer defended on the grounds that his clients should not be responsible for material provided by other webmasters. Now he’ll have to make that argument on appeal, and his clients are looking at a long prison term. This case may provide precedent in cases where the government tries to hold webmasters accountable for information found on linked websites. As our firm has warned from the beginning: Watch your links!

Two brief updates on the obscenity front: The Ohio obscenity statute was held constitutional by the Twelfth District Court of Appeals, in a challenge by Millville Video, Inc. The case involved two videos, declared obscene, even though neither video depicted sexual intercourse, fellatio or cunnilingus. The court concluded that “sadomasochism, sexual bondage and sexual discipline” fell under the Miller test’s definition of “sexual contact.” Relatedly, the owner of another Ohio video store, the Video Barn in Union Township, pled guilty to a misdemeanor count of attempted pandering of obscenity. As a term of the plea, the store can no longer advertise the words “adult” and “X-Rated.” Ohio still appears to be a hotbed of obscenity prosecutions. However, with the Bush team getting ready to take the helm, we predict widespread use of the obscenity laws on a federal level, as a crack down on the explosive growth of the adult industry under the Clinton administration.

Good news from Malaysia: That government will not censor the Internet. “The freedom of the net is assured,” said Deputy Energy, Communications and Multimedia Minister Datuk Tan Chai Ho. Sex sites topped the list of favorites among Malaysian surfers, according to a report from Now, if only the freest nation in the world would follow suit.

Lawrence G. Walters, Esquire, is a partner in the law firm of Wasserman & Walters in Winter Park, Florida. His practice concentrates in First Amendment and Internet law. He represents clients involved in all aspects of adult media. All statements made in the above article are expressions of opinion only, and should not be considered specific legal advice. You should always consult your own lawyer regarding any legal issue. You can access the firm’s web site at: