But depending on the outcome, the implications could shake the economic foundations of data ownership as it currently stands. JL
Jacob Gershman reports in the Wall Street Journal:
Online activities are mined to glean consumer insights, forecast stock movements, value real estate or predict employee behavior. Companies or researchers sometimes get explicit approval to harvest data from a website, but much of the industry operates in a legal gray zone. The dispute has implications for the growing industry of data analytics and whether “legitimate business will be permitted to scrape from the public portion of websites like LinkedIn,”
A lawsuit against LinkedIn Corp. is shaping up as a test of whether it is legal to collect publicly viewable information posted by internet users.
The social network for professionals faces a lawsuit brought by hiQ Labs, a San Francisco company that scrapes and analyzes personal data on LinkedIn to predict whether individual employees are likely to leave their jobs.
For years after starting in 2012, hiQ amassed data without objections from LinkedIn, which Microsoft Corp. acquired late last year. HiQ says it excludes profiles that require a LinkedIn account to view, analyzing fewer than 175,000 profiles in a 500-million-member network.
In May, LinkedIn’s legal counsel wrote to hiQ and ordered it to stop accessing the site. It also told hiQ it had tried to ban it through an IP-address block, asserted the company was violating a federal antihacking law and threatened to take it to court.
But hiQ got there first. It filed suit in June, asking a federal judge in California to declare that it was complying with the antihacking law and that LinkedIn was unlawfully attempting to stifle competition. On Thursday, a hearing is set on whether LinkedIn should be prevented from limiting hiQ’s access to its site.
LinkedIn says it has a “right to control access to its private property” and argues that hiQ’s data-scraping threatens its members’ privacy.
The dispute has deeper implications for the growing industry of data analytics and whether “legitimate business will be permitted to scrape from the public portion of websites like LinkedIn,” said David Thaw, a professor of law and information sciences at the University of Pittsburgh.
These days, the online activities of billions are mined to estimate inflation, glean consumer insights, forecast stock movements, value real estate or, as in hiQ’s case, predict employee behavior. Companies or researchers sometimes get explicit approval to harvest data from a website, but much of the industry operates in a legal gray zone.
The case is also the latest to ponder what constitutes hacking under the 1986 Computer Fraud and Abuse Act, which prohibits unauthorized access to computer systems and carries both criminal and civil and penalties.
The statute is mostly used to prosecute hackers and data thieves. Whether businesses that scrape publicly available information can be held liable under the law is a hotly debated legal question.
For hiQ, the stakes are high. Without LinkedIn data, hiQ may need to “close down its operations, lay off its employees, and put to waste millions of dollars in investor capital,” its lawyers told the court.
Among its services, hiQ monitors and analyzes LinkedIn profile pages to see who is polishing their résumés and liable to be poached, assigning so-called flight-risk scores to individual employees.
Lawyers for hiQ say LinkedIn has stretched the meaning of “unauthorized access” under the antihacking statute to “criminalize access to webpages that are public for the entire world to see.”
The data analysis it sells to companies such as eBay, Capital One and GoDaddy is no more invasive than the web-crawling robots that search engines like Google or Bing use to index LinkedIn profiles, its lawyers argue.
But LinkedIn says hiQ’s data-scraping isn’t as innocent as the startup contends.
“Indeed, if LinkedIn members knew that hiQ was accessing and collecting their data in this manner, many would not update their profiles,” the company told the court.
Both sides have retained star litigators. HiQ’s legal team’s includes Harvard University constitutional scholar Laurence Tribe and appellate lawyer Deepak Gupta. LinkedIn has turned to Donald Verrilli Jr. , who was U.S. solicitor general during the Obama administration.
The lawsuit isn’t the first to put scraping on trial. LinkedIn’s legal briefs highlight Facebook Inc.’s court fight with Power Ventures Inc., a now-defunct social-networking aggregator that enabled Facebook users who supplied login credentials to transfer their Facebook content to other social media platforms.
Last year, a federal appeals court upheld Facebook’s claim that Power Ventures had committed computer trespass under the Computer Fraud and Abuse Act. Power Ventures has asked the U.S. Supreme Court to review the case, arguing that antihacking law wasn’t intended to outlaw data portability.
Classified service Craigslist has also scored legal victories against companies it accused of illegally scraping its content, spamming Craigslist members and unlawfully reposting copyright-protected listings.
Distinguishing the case from other scraping disputes, hiQ isn’t just playing defense. Its lawsuit claims LinkedIn is trying to “prevent anyone but LinkedIn from being able to use public information for data analytics,” alleging violations of California’s unfair competition law.
“LinkedIn is trying to illegally force out a smaller competitor so that they can have the business for themselves, plain and simple,” said hiQ chief executive Mark Weidick in statement.
The anti-competition charges echo the antitrust concerns that Salesforce.com Inc. raised with European regulators after it lost a bidding war for LinkedIn to Microsoft. A Microsoft spokesman declined to comment.
“Our members control the information that they make available to others on LinkedIn, and they trust us to honor that control,” LinkedIn said in a statement.
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