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Whose rules apply to the Web?

Sites go to extraordinary lengths to stay legal in a world where taboos vary.

By Staff writer of The Christian Science Monitor / November 21, 2007

The idea seemed like an obvious next step for profiting from online social networks: advertisements displayed on the side of individual Facebook home pages using pictures and names of friends to promote products.

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For example, an ad for Blockbuster would hype that your friend "Meghan Marks gave a four-star rating to the movie 'Top Gun.'" Haven't seen it? Well, if Meghan likes it, perhaps you should rent it tonight.

But Facebook's new ad scheme has hit a snag – it might be illegal.

A century-old New York privacy law bans advertisers from using anyone's name or picture without written consent. Running such an ad in the Empire State is a criminal misdemeanor, says William McGeveran, a law professor at the University of Minnesota in Minneapolis.

The situation points to a larger question many dotcoms are now facing: Since websites can be displayed on screens anywhere in the world, does that mean they are beholden to the laws in every state and every country?

"When you put anything up online, you're not just sending it to New Jersey or to Australia. You're sending it everywhere," says Professor McGeveran. "It can be seen in countries with different ideas about speech and privacy – countries that don't have the First Amendment."

Applying existing laws to the Internet is a murky business. For years, courts and lawyers have questioned whether copyright laws written for the physical world should carry the same weight in the digital world, where duplicating products takes only the click of a mouse.

But sorting out which laws govern online activities could prove even more difficult, Internet experts say. After all, how do you draw jurisdictions for something called the "World Wide Web"? is based in California, and the data for those social ads can fly through wires in a dozen states before they reach your computer in New York. So which states' laws apply?

Facebook argues that it's none of the above. Because its content crosses many state borders, the site is protected from local rules by the US Constitution's Commerce Clause, says Chris Kelly, Facebook's chief privacy officer. "State laws aren't supposed to interfere with interstate commerce," he says. That's the domain of federal law.

Mr. Kelly assures that Facebook will address New York's concerns by making it clear to users that certain online actions they take would allow the site to use their faces in advertisements.

But whose rules govern US websites in other countries? There's no international equivalent to the Commerce Clause, so foreign judges apply local law.

Such a ruling caused a YouTube blackout in many parts of Brazil earlier this year. Supermodel Daniela Cicarelli sued the American video-sharing site in a Brazilian court, claiming that a steamy clip of her and banker Renato Malzoni that had popped up on the user-driven site violated her privacy. A court ordered YouTube to prevent the popular video from reaching computers in Brazil and demanded that some Internet providers block access to the entire website until YouTube could put an effective filter in place for that one video.

"There is no way to stop a similar lawsuit in the future," says Mia Garlick, product counsel for YouTube. "Different countries have different standards for privacy.... And it's obvious that you can't be on top of all the laws."