MagicJack routed by Boing Boing

Voice over IP gadget maker MagicJack’s attempts to gag the online tech rag Boing Boing about its spying claims using the glorious US legal system have backfired. MagicJack claimed that it had been defamed by an article penned by Boing Boing in April 2008 about its terms of service.

These gave the outfit the right to analyse customers’ calls. It also reported about some iffy characteristics of its website. The article said that Magicjack’s system allowed it to target ads at users based on their calls. Users had to waive the right to sue in court. It’s site contained a visitor counter that incremented automatically.

The site claimed to be able to detect MagicJacks, reporting that “Your MagicJack is functioning properly” even when none were present. MagicJack alleged that these statements were false, misleading, and had irreparably harmed MagicJack’s reputation by exposing it to “hate, ridicule and obloquy.” It demanded removal of the story and damages.

Boing Boing claimed in court that it was a SLAPP lawsuit which is legalese for a strategic lawsuit which is designed to gag the press. Using the Slapp law the magazine forced MagicJack to show it would have a ‘reasonable probability’ of prevailing if it went to trial.

The judge said it hadn’t –  pointing out that in its evidence MagicJack essentially admitted doing what the article said. “Plaintiff’s own evidence shows that the counter is not counting visitors to the website as a visitor visits the site,” wrote Judge Verna A. Adams. “Instead, the visitor is seeing an estimate. … As to the statements based on the EULA, such statements, read in context, do not imply that the plaintiff is eavesdropping on its customers calls. Instead, the statements clearly constitute the opinion of the author that analyzing phone numbers for purposes of targeted advertising amounts to “spy[ing],” “snoop[ing],” and “systematic privacy invasion.”

That should have been the end of it but Magicjack tried to get Boing Boing to shut up about the case by offering to pay the magazine’s legal costs. Boing Boing offered not to publish details of the legal costs or the settlement if Borislow would donate $25,000 to charity. MagicJack, however, offered to pay the legal bill only if Boing Boing agreed to keep the whole dispute confidential. Although not seen much over the pond, MagicJack’s television infomercials are played a long on cable television. The gadget itself, no larger than a 3G modem, earned praise from gadget reviewers and opprobrium from Florida’s attorney general.

But the Better Business Bureau of Southeast Florida has received hundreds of customer service complaints, primarily related to difficulty returning the product under the 30-day guarantee and the lack of an uninstaller. The Bureau said it strongly questioned the company’s reliability for reasons such as that they have failed to respond to complaints, their advertising is grossly misleading, they are not in compliance with the law’s licensing or registration requirements, their complaints contain especially serious allegations, or the company’s industry is known for its fraudulent business practices.

Boing Boing points out it is not the first time Magicjack has been in court over blogs. In December 2008, MagicJack filed a $1,000,000 lawsuit against competitors Joiphone and PhonePower, who linked to a blog post by a Singapore-based blogger whose own discussion of the product echoed its own case.  “Magic Jack will spy on you and force you into arbitration.” In that case, MagicJack’s legal rationale was trademark infringement, false advertising and violation of the unfair trade practices act, Boing Boing said.