After serving as an industry punching bag for the last month, Sony recently decided to punch back regarding its recent data breach and attendant publicity surrounding the incident. The method chosen by Sony was to hire one of the country’s best known and expensive lawyers to send an aggressive cease and desist letter to various media companies reporting on the incident. David Boies became famous, by among other things, representing Al Gore in the 2000 election case. Among his media company targets, many internet companies such as Twitter feature prominently. Not surprising given the SOPA battles waged between Silicon Valley tech companies like Google and old guard Hollywood and its mouth piece, the MPAA.
This action by Sony raises three questions. First, as a practical matter, is the letter a wise strategic decision? Second, is the letter effectively drafted to accomplish Sony’s strategic goals. Third, do digital media publishers face a legitimate risk of liability if they do not comply with the letter’s demands? For the last question, First Amendment doctrine plays a prominent role.
As a digital media attorney, I think the letter was probably a wise strategic decision in concept. An offensive response was long overdue given that Sony’s brand has been so badly damaged because of its handling of employee private data. Sony had to take some action to protect employee data beyond the formality of providing a data breach notice. California law, and forty-six other states, requires prompt notice to victims of a data breach regarding disclosure of personally identifiable information. See California Civil Code s. 1798.29(a) and California Civ. Code s. 1798.82(a).
While it may appear that Sony’s pre-breach data security was woefully inadequate, possibly negligent, at this point in time the only thing that Sony can do to stop the bleeding is to force media outlets to think twice before releasing further private information. For this reason, the letter was not a bad strategy play. David Boies is a known quantity in the litigation world so the threat is credible.
As for the content of the letter itself, the work product leaves something to be desired as it has the earmarks of a hastily put together legal missive. For example, the letter is woefully deficient in laying specific categories of documents that may generate liability upon publication. A more effective approach from my perspective would be to provide specific legal downside rather than generalized legal saber rattling. To this end, Boies would have been well served to outline specific legal theories that would entitle Sony to relief upon publication. It would have been wise to then anticipate the obvious legal defenses and debunk their effectiveness in thwarting liability in this situation.
Furthermore, Boies ended his letter with the typical “cooperate or be sued” rhetoric that often does not play well with the intended audience of digital media general counsels. A more effective approach would be to couple specific viable liability theories with an invitation to cooperate in order to achieve a unified interest of litigation avoidance. Then again, the saber rattling approach is not surprising considering that Boies was hired by Sony executives who have taken a beating in the media for weeks and likely needed to punch back at some targets. If nothing else, it may serve as expensive therapy. Finally, it may seem uncouth for a large media company with plenty of digital media assets to be targeting its brethren. Media companies generally don’t sue other media companies over reporting activity no matter uncomfortable the reporting gets.
This concludes part 1 of my analysis, we’ll pick up with part 2 after the Christmas holiday. Merry Christmas to all.