An interesting variation on the “membership drive” and one that’s gotten Tagged in hot water with New York Attorney General Andrew M. Cuomo, who intends to sue the company “for deceptive e-mail marketing practices and invasion of privacy.”

“This company stole the address books and identities of millions of people,” Cuomo said in a statement. “Consumers had their privacy invaded and were forced into the embarrassing position of having to apologize to all their e-mail contacts for Tagged’s unethical–and illegal–behavior. This very virulent form of spam is the online equivalent of breaking into a home, stealing address books and sending phony mail to all of an individual’s personal contacts. We would never accept this behavior in the real world, and we cannot accept it online.”

Tagged, for its part, claims this is all just a big misunderstanding. In a statement of its own, the company denied abusing its users’ personal address books, saying, essentially, it had their consent to do so.

“When our company tested a new registration process, we discovered that our ‘invite your friends’ language was confusing,” said Tagged CEO Greg Tseng. “…In no instance did Tagged access a person’s personal address book without their consent and no emails were sent without the person giving us permission. We realize that some were confused and accidentally agreed to invite their friends.”

Oh, and next time you register for a social network, be sure to read its Terms of Service–especially the portions that are presented in ALL CAPS. They might be important. From Tagged’s Terms of Service:

“E) Notice Regarding Commercial Email

MEMBERS CONSENT TO RECEIVE COMMERCIAL E-MAIL MESSAGES FROM TAGGED, AND ACKNOWLEDGE AND AGREE THAT THEIR EMAIL ADDRESSES AND OTHER PERSONAL INFORMATION MAY BE USED BY TAGGED FOR THE PURPOSE OF INITIATING COMMERCIAL E-MAIL MESSAGES.”

According to a new survey from Vlingo, a company that develops speech-recognition technology for mobile phones, 26 percent of its nationwide sample of 4,816 mobile phone users said they sent texts while driving. This despite laws against Driving While Texting in some seven states and some nasty DWT-related accidents. The states with the highest percentage of DWT drivers: Tennessee (42 percent), New Jersey (35 percent), Alabama (34), Idaho (33) and Oklahoma (31.7).

Ironically, 83 percent of the people surveyed said they feel texting while driving should be illegal.

“In just one year, the public conversation about the issue of DWT has escalated, particularly in the wake of some high-profile accidents,” Dave Grannan, chief executive of Vlingo, said in a statement. “Texting is such an integral component of our daily lives, and the cautionary tales about DWT danger have not stemmed the tide. We predicted last year that this problem would get worse, and it has since more people are texting. The good news is that many state legislatures are starting to take up this issue, and today more advanced technologies exist that can increase safety on the roads.”

My God, if one in four drivers admit to driving while texting, how many more were too ashamed to?

Microsoft, Yahoo and Google have agreed to fork over millions of dollars to settle allegations that they sold ads promoting illegal online gambling. Without admitting or denying liability, the three companies agreed to forfeit a collective $31.5 million in advertising revenue and to underwrite public-service campaigns warning that online gambling is illegal. Of the three, Microsoft has the biggest forfeiture and fine, totaling $21 million. Of that, $4.5 million will go the government, $7.5 million to the International Center for Missing and Exploited Children, and $9 million to a PSA campaign. Yahoo’s on the hook for $7.5 million–$3 million to the government and $4.5 million to another PSA campaign. Google’s tab is just $3 million.

“These sums add to the over $40 million in forfeitures and back taxes this office has already recovered in recent years from operators of these remote-control illegal gambling enterprises,” U.S. Attorney Catherine L. Hanaway of the Eastern District of Missouri said in a statement. “Honest taxpayers and gambling industry personnel who do follow the law suffer from those who promote illegal online behavior.”

The DOJ says the $222,000 in damages awarded to the Recording Industry Association of America in the Virgin Records America et al. v. Thomas copyright-infringement case is constitutional. Seems it didn’t quite buy Thomas’s argument that fining someone – particularly a single mother of two – $222,000 for songs that could be bought for $24 on iTunes violates a Supreme Court precedent that prohibits fines that are “so severe and oppressive as to be wholly disproportioned to the offense or obviously unreasonable.”

From the DOJ’s brief:

Although defendant claims that plaintiffs’ damages are 70 cents per infringing copy, it is unknown how many other users–‘potentially millions’–committed subsequent acts of infringement with the illegal copies of works that the defendant infringed. Accordingly, it is impossible to calculate the damages caused by a single infringement, particularly for infringement that occurs over the Internet. Furthermore, plaintiffs contend that their witnesses ‘testified to the substantial harm caused by the massive distribution of their copyrighted sound recordings over the Internet, including lost revenues, layoffs and a diminished capability to identify and promote new talent…’

“Most recently, Congress has crafted a statute that serves as a deterrent to those infringing parties who think they will go undetected in committing this great public wrong, as well as providing compensation to copyright owners who have to invest resources into protecting property that is often unquantifiable. Accordingly, given the findings of copyright infringement in this case, the damages awarded under the Copyright Act’s statutory damages provision did not violate the due process clause…”

Terry Gross: “Are you trying to say to me that all that matters to you is money?”
Gene Simmons: “I will contend, and you try to disprove it, that the most important thing as we know it on this planet, in this plane, is, in fact, money. Want me to prove it? …The first thing you need–besides air, which so far is free, and by the way if you went scuba diving, you’re paying for air–the other thing besides that is food, it’s what we need to survive. I don’t know what other tool I would use besides money to buy it. Although, as a woman of course you have the ability to sell your body, then get the money, and then, with that, get food. But ultimately money is part of it.”

–Excerpt from Gene Simmons’s Feb. 4, 2002, interview with Terry Gross, host of NPR’s “Fresh Air”

Kiss fans hoping for a new album will have to make do with the band’s “Rock & Roll All Night” toothbrush instead. Because according to Kiss frontman Gene Simmons, the band won’t be going into the studio anytime soon.

Seems Simmons has been a bit disillusioned with the recording industry lately–particularly its failure to stamp out illegal file-sharing. “The record industry doesn’t have a f—ing clue how to make money,” Simmons told Bilboard. “It’s only their fault for letting foxes get into the henhouse and then wondering why there’s no eggs or chickens. Every little college kid, every freshly scrubbed little kid’s face should have been sued off the face of the earth. They should have taken their houses and cars and nipped it right there in the beginning. Those kids are putting 100,000 to a million people out of work. How can you pick on them? They’ve got freckles.”

Said Kelly: “We are fairly confident that our operation is well presented to users and that they can make their own choices about whether they want to affiliate with brands that put up Facebook pages.”

Daniel J. Solove, the George Washington University Law School professor who first noted Facebook’s Social Ads might be illegal, finds Kelly’s argument unpersuasive. “Suppose Michael Jordan says on national TV that he likes Wheaties,” Solove posits. “Does this allow Wheaties to use his image on its cereal box or in a commercial? The answer is no. The fact that Jordan says he likes Wheaties can be used in a news story; it can be used in a biography of Jordan. But it cannot be used in a commercial advertisement. … [Social Ads] are not merely reporting facts (which is OK under appropriation and publicity); instead, they are using the reputation and standing of people to promote commercial products and services.”

Facebook would likely argue users agree to this when they accept the company’s terms of service, which grant it license to use their “content” in pretty much any way it chooses.

By posting User Content to any part of the Site, you automatically grant, and you represent and warrant that you have the right to grant, to the Company an irrevocable, perpetual, nonexclusive, transferable, fully paid, worldwide license (with the right to sublicense) to use, copy, publicly perform, publicly display, reformat, translate, excerpt (in whole or in part) and distribute such User Content for any purpose on or in connection with the Site or the promotion thereof.”

But there’s no language in these terms of service that explicitly grants it the right to use Facebook members’ names and likenesses in a commercial endorsement–unless Facebook is counting on a broooooad interpretation of “reformat” and “translate.”

Social actions are powerful because they act as trusted referrals and reinforce the fact that people influence people. It’s no longer just about messages that are broadcasted out by companies, but increasingly about information that is shared between friends. So we set out to use these social actions to build a new kind of ad system.”

–Facebook CEO Mark Zuckerberg

“Once every hundred years media changes.” With that vainglorious pronouncement, Zuckerberg on Tuesday ushered in a new era of socially networked advertising.

Or did he? Because according to Daniel J. Solove, an associate professor of law at the George Washington University Law School, combining a Facebook user’s name and image with an advertiser’s message in a so-called “Social Ad” without that user’s express permission may be illegal.

“It seems as though Facebook might be assuming that if a person talks about a product, then he or she consents to being used in an advertisement for it,” Solove writes. “But such an assumption might be wrong, and the use of a person’s name or image in an advertisement without that person’s consent might constitute a violation of the appropriation of name or likeness tort. … According to the Restatement (Second) of Torts § 652C: ‘One who appropriates to his own use or benefit the name or likeness of another is subject to liability to the other for invasion of his privacy.’ “

Now Facebook claims no personally identifiable information is shared with an advertiser in creating a Social Ad. “Facebook has always empowered users to make choices about sharing their data, and with Facebook Ads we are extending that to marketing messages that appear on the site,” the company explains. “Facebook users will only see Social Ads to the extent their friends are sharing information with them.” That’s certainly a thoughtful assurance. But it doesn’t exactly address the issue of Facebook appropriating user identities for its own benefit.