MagicJack Tries To Silence Boing Boing; Loses And Has To Pay $50,000

from the slapp-that dept

Tue, Feb 23rd 2010 1:50pm — Mike Masnick

MagicJack, a VoIP-dongle solution that I've used in the past, has a reputation as a product that actually works pretty well, but the company behind it has some serious problems. It's marketed aggressively on cable TV, has put misleading claims on its website, hides important things in the fine print and is not particularly good with customer service. Also, the software, once installed, is quite difficult to ever remove. In 2008, BoingBoing wrote a post detailing the shadier practices of MagicJack. Rather than doing the smart thing and improving those practices, MagicJack decided to sue BoingBoing. That was a mistake. It was a clear SLAPP case, and after MagicJack effectively had to admit that nothing in BoingBoing's post was actually wrong, the judge dismissed the case and ordered MagicJack to pay BoingBoing $50,000 in legal fees.

Thankfully, BoingBoing was helped by the fact that California has a strong Anti-SLAPP law -- something that the rest of the country could use. What's more telling (and interesting) than the dismissal, however, is that MagicJack had originally agreed to settle the lawsuit, and pay BoingBoing's legal costs (after the company's CEO realized that the case was a lost cause and -- he claimed -- his own lawyers had failed to properly notify him of California law), but backed out when BoingBoing wouldn't agree to keep the lawsuit and settlement confidential.

Again, that suggests a company that knows what it's doing is shady, at best, but rather than having any interest in improving the way it goes about its business, wants to keep things hidden.

I have to admit, I really don't understand why MagicJack feels the need to work this way. It's a decent product that should be able to sell on its own merits, explaining openly what it does, rather than hiding stuff in the fine print and falsely claiming how many people are signing up to use the device. Imagine if, instead of suing and losing and getting all of this negative publicity, the company had just cleaned up its act, been open about things, apologized for its earlier mistakes and focused on building a better business?

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Filed Under: defamation, eulas, magicjack, slapp
Companies: boingboing, magicjack

28 Comments

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Ima Fish (profile), 23 Feb 2010 @ 1:57pm

"the company's CEO.... claimed his own lawyers had failed to properly notify him of California law."

This is basically an admission from the CEO that the purpose of the lawsuit was to silence Boing Boing.
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Ian, 23 Feb 2010 @ 2:04pm

We all know what happens next
Cue Streisand Effect.
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taoareyou (profile), 23 Feb 2010 @ 2:10pm

Just Curious
Today every single comment I have made has been "held for moderation" and never posted. Has anyone else had this problem?
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- taoareyou (profile), 23 Feb 2010 @ 2:11pm
  
  Re: Just Curious
  Until now that is.
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- Mike Masnick (profile), 23 Feb 2010 @ 2:26pm
  
  Re: Just Curious
  Today every single comment I have made has been "held for moderation" and never posted. Has anyone else had this problem?
  
  For whatever reason, your IP address got picked up as being a spammer's IP address, so the system held your comments. We tend to go through the held comments once or twice a day -- as they rarely catch any legitimate comments (maybe once per week), while catching approximately 10,000 to 20,000 actual spam messages per day.
  
  I just released your comments.
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Anonymous Coward, 23 Feb 2010 @ 2:47pm

I have to admit, I really don't understand why MagicJack feels the need to work this way.

G-R-E-E-D

Shy settle for an honest, fair profit if you can make even more being shady?
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- Anonymous Coward, 23 Feb 2010 @ 2:52pm
  
  Re:
  Grrr, "Why", not "Shy"
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Anonymous Coward, 23 Feb 2010 @ 2:50pm

For whatever reason, your IP address got picked up as being a spammer's IP address, so the system held your comments.

Yikes, you sound like one of the **AA's there.

IP address don't correspond to individuals. If you treat them like they do, you're going to wind up wrongly accusing innocent individuals.
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- Pirate My Music (profile), 23 Feb 2010 @ 3:03pm
  
  Re:
  1) The comments aren't being deleted automatically, they're just being held so that a moderator can check to make sure they're not pumping out spam.
  
  2) Would you rather have a shit ton of spam or the miniscule chance that someone is briefly inconvenienced?
  
  IP Addresses that are constantly spitting out spam get logged, I assume, and thus have to be checked. This isn't an **AA tactic, it's an "every site with comments" tactic.
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  - Anonymous Coward, 23 Feb 2010 @ 3:43pm
    
    Re: Re:
    1) The comments aren't being deleted automatically, they're just being held so that a moderator can check to make sure they're not pumping out spam.
    
    Didn't said they were. What part of what I *actually* said isn't true?
    
    2) Would you rather have a shit ton of spam or the miniscule chance that someone is briefly inconvenienced?
    
    2) Would you rather have a shit ton of "piracy" or the miniscule chance that someone is wrongly accused? Lemme guess.
    
    This isn't an **AA tactic...
    
    To the contrary, it's standard practice for them.
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    - Ryan, 23 Feb 2010 @ 4:10pm
      
      Re: Re: Re:
      The big difference, obviously, is that this is a private site that implements certain measures of restricting what comments other people can post on its own online property. Three-strikes laws and the like, which I presume you are alluding to, are artifacts using the legal system to forcibly limit you from using your own property on the basis of accusations made of actions you are taking with your own property.
      
      Additionally, no accusation was made in this instance. The comments were temporarily withheld from appearing to others on the site until they could be verified(you might compare this to a judicial process that actually required proof of infringement before kicking individuals off the internet).
      
      But you knew this discrepancy, obviously. You're just being an ass.
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      - Anonymous Coward, 23 Feb 2010 @ 4:22pm
        
        Re: Re: Re: Re:
        You're just being an ass.
        
        Hey, nice name calling there! Real classy!
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      - Anonymous Coward, 23 Feb 2010 @ 4:23pm
        
        Re: Re: Re: Re:
        Three-strikes laws and the like, which I presume you are alluding to...
        
        You presume wrong.
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- Anonymous Coward, 23 Feb 2010 @ 4:19pm
  
  Re:
  Yikes, you sound like one of the **AA's there.
  
  Let me clarify my comment there. I certainly didn't mean to imply that Mike is just like the **AA's. That would be beyond ridiculous.
  
  But there is a subtle but important difference between saying "your IP address got picked up as being a spammer's" or saying "your IP address got picked up as being as a source of spam". The former implies that you can identify something about a person based on their IP address, while the latter doesn't. I think Mike actually meant the latter, but just got a little sloppy with his phrasing, which was the cause for my "Yikes" comment.
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- Anonymous Coward, 24 Feb 2010 @ 5:12am
  
  Re:
  Not the same, obviously.
  
  I don't taoareyou was sent a presettlement letter.
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Anonymous Coward, 23 Feb 2010 @ 3:00pm

I was going to buy their product until I found out it didn't actually use real magic.
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- Skittles, 23 Feb 2010 @ 4:23pm
  
  Re:
  Worse, it compensates for the lack of realmagic(tm) by incorporating an overabundance of realJack(tm), and if you're like me, you don't care for someone else's Jack, in whatever amount.
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Tom Landry (profile), 23 Feb 2010 @ 3:10pm

wow, I almost bought one of these things.

Other than the EULA does it mention anywhere that your calls are not private? Seems like an issue that can't simply be buried in just the EULA without incurring some kind of criminal invasion of privacy statute.

then again, I'm not an attorney.....
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- Comboman (profile), 24 Feb 2010 @ 5:27am
  
  Re:
  The EULA does not say the calls aren't private, it says "Our computers may analyze the phone numbers you call in order to improve the relevance of the ads". Of course the company routing your telephone calls knows what numbers you're calling (that's how they bill you). The same is true for Vonage or Skype or even a regular, old-fashioned telephone company. The difference is that MagicJack uses that calling information to target ads at you (like Google does with searches or gMail). Yes it's somewhat creepy, but it's not a criminal privacy issue.
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Anony1, 23 Feb 2010 @ 4:08pm

Imagine if, instead of suing and losing and getting all of this negative publicity, the company had just cleaned up its act, been open about things, apologized for its earlier mistakes and focused on building a better business?

Imagine...all the people....ohhoooohooo...rock on..
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Anony1, 23 Feb 2010 @ 4:25pm

Hey people where's that Imagine spirit Mike was brining up?
Let's all get along in peace...ohooohoooo...LOL.
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Jared, 23 Feb 2010 @ 5:08pm

Quality Costs Less
W. Edwards Deming actually taught that quality ends up costing less in the long run. Instead of masking MagicJack's lack of quality, they should have just improved and put the $50,000 in BoingBoing's legal fees and their own legal fees into actually improving their product. It definitely would have payed bigger dividends in the long run.
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- Anonymous Coward, 23 Feb 2010 @ 5:15pm
  
  Re: Quality Costs Less
  W. Edwards Deming actually taught that quality ends up costing less in the long run.
  
  Which doesn't mean much if your main American-style concern is short-term profits.
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PRMan, 23 Feb 2010 @ 5:10pm

It would seem
It would seem that if MagicJack raised their price by $10 per item, they could have top-notch service and support. That's still a really cheap price per year.
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- Anonymous Coward, 23 Feb 2010 @ 6:01pm
  
  Re: It would seem
  Exactly, looks to me like they cover their costs with the $20/year and make money with the targeted ads - no room for support. Nice try at innovation but a complete privacy, customer service and pr fail.
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Offbeatmammal (profile), 23 Feb 2010 @ 10:27pm

MagicJack is okay but needs polish
I've been a happy MJ user for a couple o years now, but the software/device does need a bit more polish - it's got some rough edges and the tendancy to get itself hung up and need a reset/reformat

It works a lot better with MagicFeatures - http://www.pcphonesoft.com - annoying it needs an add-on to make these work.

Somewhere between Skype and this would make a perfect solution
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MG, 25 Feb 2010 @ 9:59am

nettalk tk6000
nettalk is a good clean open alternative....they have a good user forum as well www.nettalk.com
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Magic Jack Problems, 27 Apr 2010 @ 10:53am

Nettalk? Really
Even though Magicjack has no customer service,. no one can beat their price. Nobody.
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