interactive computer service from disclosing to third parties any personally identifiable information provided by subscribers to the service.

Other proposed or passed federal legislation includes:

* The Internet Gambling Prohibition Act of 1997 (introduced).

* The Internet Tax Freedom Act -- a proposal for a two-year moratorium on the taxation of Internet transactions by state and local governments.

* The Online Copyright Liability Limitations Act -- a measure that would protect service providers from infringement claims based on the mere transmission of infringing material.

* The Electronic Commerce Enhancement Act -- a bill that would make government forms available online and allow citizens to use digital signatures to sign those forms.

* The No Electronic Theft Act -- a law President Clinton signed recently that makes the willful electronic distribution of a copyrighted work a criminal offense.

The federal agencies are also hard at work in this area. The Commodities Futures Trading Commission (CFTC) has proposed rules regulating certain conduct on the Internet, for example, by requiring registration with the CFTC by anyone who issues or promulgates futures contracts analyses or reports.

The Federal Trade Commission (FTC) did a lot of Web surfing in 1997. It conducted "North American Health Claim Surf Day," wherein individuals surfed the Web in search of Web sites containing false or deceptive health claims. The FTC has not limited its inquiries to health care. It has held surf days to uncover other online wrong-doing. Most recently it filed suit and obtained injunctive relief against

several firms and individuals who participated in a scheme whereby a "viewer" program that, when downloaded from the Internet, disconnected the user's computer and "secretly redialed a Moldovian telephone number." The respondents received a kickback from the long distance provider and unwaring users received large bills from the telephone company in Moldova. This activity was enjoined.

The lesson here is simply that the states and federal government, regulatory agencies, and even many municipalities want to play a role in stopping or regulating many of the activities that are carried out on the Net. If you represent clients in this area, a thorough search of legislation and administrative action should be undertaken. One must also keep in mind that the law of the Internet is not just limited to the United States. Although this review has been so limited, we, as attorneys in a small world, may have to expand our search in resolving Internet legal issues. International Internet law is an area ripe for expansion, and it is likely to be a large area of concern in the coming years.


The [past] year would not be complete without a brief review of some of the constitutional challenges to Internet regulation. Many are aware of the successful challenges to portions of the Communications Decency Act. See ACLU vs. Reno, 929 F.Supp. 824 (E.D. Pa. 1996) aff'd 117 S.Ct. 2329 (1997).

Sen. Dan Coates of Indiana has already proposed a more narrowly focused version. Referred to by some as the "Son of CDA," the scaled-back measure would require purveyors of material "harmful to minors" to restrict access in various ways.

Successful constitutional challenges were made on other fronts too, including challenges to state legislation regulating various aspects of the Net. See, for example, American Library Association vs. Pataki, 969 F.Supp. 160 (S.D. N.Y. 1997). However, the arguments of spammers who believe they have the constitutional right to distribute e-mail through services such as AOL have met with little success. Indeed, in America Online vs. Cyber Promotions Inc., 948 F.Supp. 456 (E.D. Pa. 1996), the court rejected the argument that AOL was a state actor and had unconstitutionally prohibited the flow of certain forms

of e-mail.

Earlier [in 1997], a federal court in Ohio reached a similar conclusion with respect to CompuServe and, as