On April 17, 2013, the United States Federal Trade Commission (FTC) issued an Order Denying Petition to Quash Civil Investigative Demand in the Matter of Jerk, LLC. This means that an investigation started by the FTC will now proceed and Jerk.com will either need to challenge the FTC in court or they will need to turn over the requested files and information. The hammer seems to be coming down on Jerk.com, which should make an awful lot of tormented, harassed and cyber-bullied people quite happy.
Jerk, LLC operates Jerk.com, a social networking website that collects and displays profiles, which include photographs, names, ages, email and physical addresses, telephone numbers, and opinions. Information on the website includes, among other things, information that is publicly available on other Internet sites and newly created user-generated content. Jerk.com encourages users to add personal information to profiles and to rate the profiled individuals as either “jerks” or “saints.”
One of the more nefarious things about the Jerk.com website is that others are allowed to create a profile for you using your picture and your information without you having any knowledge. Early on in the company’s development they would gleefully refuse to remove any profile, even profiles of children as young at 10 years old or younger. Upon request to be removed, or clicking on “Remove Me,” Jerk.com proclaimed that things put up on the Internet are not capable of being removed and are there to be freely used by whomever for whatever purpose. Copyright law be damned, Jerk.com in the early days was going to do whatever they wanted to do. They refused to remove any profiles, even profiles of minors. See Using U.S. Copyright Law to Get Removed from Jerk.com and Dealing with Online Harassment and Cyberbullying.
Over time the website changed. According to the petition to quash filed by Jerk.com a consumer who wants his or her profile removed from Jerk.com may pay a $25 fee for customer support, which in my opinion is nothing more than an electronic, modern-day extortion racket. Jerk.com disregards copyrights in photographs, seemingly sucks photographs from Facebook profiles without permission and then will take you down if you pay $25. Exactly how that differs on a conceptual level from mafioso shakedowns on generations past escapes me.
The Jerk.com petition to quash also claimed that Jerk receives requests to remove a profile by email and through its Digital Millennium Copyright Act (“DMCA”) agent, and also claims to remove children’s profiles regardless of the source of the removal request. I don’t doubt that Jerk.com removes profiles where there is a DMCA takedown notice. What is strange, however, is that they refused to tell me who their DMCA agent is. Jerk.com’ attorney Maria Crimi Speth communicated with me during the summer of 2012 and blamed me for all the DMCA takedown notices they were receiving. It seems I was the only one writing about Jerk.com as a problem and they were getting numerous DMCA takedown requests. I asked her who their DMCA agent was and never received a response. Ultimately, I decided if they were not going to inform me as to who their duly authorized DMCA agent is then I would tell folks I couldn’t get that information and they should direct takedown requests to Ms. Speth. See Jerk.com: Who to Contact to Get Removed.
The FTC Investigation
In April 2012, after receiving hundreds of complaints about Jerk, FTC staff opened an investigation. The investigation focused initially on whether Jerk.com was collecting information from children in violation of the Children’s Online Privacy Protection Act (“COPPA”). On July 27, 2012, the Commission issued a Civil Investigative Demand (CID) for documents and interrogatories for information relating to Jerk.com’s data collection practices and its profiles of children.
After reviewing Jerk’s responses to the CID and information from other sources, including consumer complaints, the FTC Staff determined that it was necessary to expand the focus of the investigation also to inquire into the source of information appearing on Jerk.com – in particular, whether Jerk may have created profiles on its website by harvesting photos from the Internet. Consumers have complained that Jerk.com contains private photos from Facebook, a complaint that we hear all the time at IPWatchdog.com. In fact, we have even recently heard that a picture appearing only on Facebook and then used on Jerk.com miraculously vanished from Jerk.com when the person deleted the photo from her Facebook account. If true that suggests that Jerk.com is engaging in some kind of elaborate inline linking of images from Facebook. Based on what I have been able to uncover myself that would seem to be a change in the way Jerk.com acquires photographs. The change is not insignificant given that inline linking has historically not been considered to be copyright infringement. Of course, if this type of unauthorized and harassing use of photographs online is beyond the reach of legal processes that would likely significantly curtail usage of photo sharing websites. Indeed, Facebook and other photo sharing websites may wind up being the ones who would have to stop Jerk.com for unauthorized access to their network. Something that does have precedent in case law.
In any event, on February 13, 2013, as part of the broader inquiry, the Commission issued a CID to Jerk seeking testimony on ten subjects relating to Jerk’s responses to the prior CID; Jerk’s operations; Jerk’s interactions with other social media sites, including Facebook and Twitter; and Jerk’s communications with consumers. The CID asked Jerk to designate and make available one or more officers, directors, or others to testify on Jerk’s behalf at an investigational hearing on April 3, 2013 at the FTC’s San Francisco office.
On March 15, 2013, Jerk submitted the instant petition seeking to quash the CID seeking its testimony on the topics enumerated above.
The FTC Ruling on the Petition to Quash
Jerk.com contended that the CID seeking the testimony of a corporate representative does not satisfy the legal standards because: (1) the Commission resolution authorizing the CID does not provide adequate notice of the nature and scope of the investigation; and (2) the ten subjects listed in the CID are not relevant to an investigation of acts and practices related to consumer privacy and/or data security.
The FTC explained:
Agency compulsory process is proper if the inquiry is within the authority of the agency, the demand is not too indefinite, and the information sought is reasonably relevant to the inquiry, as that inquiry is defined in the investigatory resolution. It is well established that agencies have wide latitude to determine what information is relevant to their law enforcement investigations and are not required to have “a justifiable belief that wrongdoing has actually occurred…
… The resolution authorizing the process provides the requisite statement of the purpose and scope of the investigation. A resolution may define the investigation generally, and need not state the purpose with specificity, or tie it to any particular theory of violation.”
After distinguishing the cases relied upon by Jerk.com, the FTC explained that the nature of the FTC inquiry is hardly a secret given previous communications with the company. The order explained:
Jerk’s argument also fails in light of the history of communications between the company and the FTC. The purpose of an authorizing resolution is to notify a CID recipient of the nature and scope of the investigation. Given the dialogue between staff and counsel for Jerk, there is no doubt that the company is aware of the nature of staff’s investigation, particularly in light of Jerk’s response to the earlier CID and the meet-and-confer discussion.
The FTC then denied each specific challenge raised to the information sought in the CID and ultimately denied the petition to quash.
The next step is for Jerk to: “appear and testify… at Federal Trade Commission, 901 Market Street, Suite 570, San Francisco, California, 94103 at 9:00 a.m. on May 1, 2013, or at such other date and time as Commission staff may direct in writing.”