When we donate to charities, it's never clear exactly where the money goes and whether our donations actually benefit the people they're supposed to help. Many donors are often shocked and outraged when they learn that some executives at nonprofit charities are being paid salaries exceeding $1 million. But activist and fundraiser Dan Pallotta thinks this anger is misplaced and could damage charity fundraising, pointing out that people blame capitalism for creating inequities in our society, but then they refuse to let nonprofits use the tools of capitalism to fix the problem. Here are a few more things to think about when it comes to charities.
It's really hard to turn money into help. That's what Tim Myers, founder of the Haiti School Project, realized after having spent more than $100,000 to build a school in Villard, Haiti. [url]
Somaliland's success could be partly due to its lack of foreign assistance. Somaliland has been operating successfully as an independent country since it seceded from Somalia in 1991. Since Somaliland isn't recognized as a country by the rest of the world, it hasn't been able to receive foreign aid. As a result, it has been surviving by raising local tax revenues, which its citizens have been using as leverage to make the government more accountable.[url]
It's sometimes difficult to verify economic theories in the real world because it can be expensive to "test" really important policies. But as more and more people play increasingly realistic video games with active marketplaces, there may be ways to observe real economic phenomena in virtual economies. Here are just a few interesting observations on the topic of scarcity.
Another day, and still, Charles Carreon keeps digging. In case you just woke up from a coma, here are all the earlier posts on Carreon. The latest is both a bizarre semi-backtrack, as well as another case of him feverishly continuing to dig that Carreon Effect hole deeper and deeper.
The "backtrack" comes to us via Popehat, pointing us to an interview with Carreon in which he admits that the letter he sent to kick off this whole mess... was a mistake. Yes. You read that right:
Ironically, the threat of the first lawsuit [Funnyjunk suing Inman] never materialized. Carreon admits he was misinformed: Before demanding the $20,000, which was based on FunnyJunk's "estimate of advertising losses sustained due to the taint of being accused of engaging in willful copyright infringement," Carreon was told that all Oatmeal comics had been taken off the FunnyJunk site, even though they hadn't. "If I had known... no demand would have gone out," he says.
You would think that, upon realizing this -- that the entire premise of his letter which kicked off this entire thing was wrong -- he would think better off pursuing a separate strategy in response to the backlash for what he now admits was in error. But, no. Also, as Ken at Popehat points out, saying these things could be construed as "revealing a confidential attorney-client communication between himself and FunnyJunk in order to make himself look less ridiculous."
And then he continues to dig, dig, dig, dig dig.
You see, in another interview (dude gets around), this time with Ars Technica, Carreon
trots out his latest bizarre theory of liability for Matthew Inman. In the lawsuit, he claimed that he thought Inman might keep everything raised above the target goal of $20,000, even though Inman never made any suggestion that was true, and in fact, Inman had said quite clearly (way before Carreon's rampage and lawsuit) that he was going to donate 100% of everything raised to charity. But Carreon says it doesn't matter:
“It sounds like he stands to make $180,000,” Carreon said. “He’s the authorized agent of IndieGoGo. I know this shit is hard to put together. That’s why we hire lawyers, because we read the statute and we take the risk.” (“Inman's commitment after the fact is not evidence of his original intention," Carreon clarified later by e-mail).
It should be noted, of course, that it does not appear that Carreon has "hired a lawyer" since he filed the case pro se (representing himself). The whole "authorized agent of IndieGogo" thing seems to be an astoundingly weak attempt to twist what IndieGoGo does and what Inman did to fit it under the California law on commercial fundraisers.
But, here's where Carreon goes really far out on a limb. On the very same post where Inman tells everyone that 100% of the money is going to charity, he also points out that he is going to add some other charities to the list. Nearly everyone thinks this is a really good thing. More money going to more charities. Awesome. But, no, not to Carreon. Apparently this is evidence of a nasty "bait & switch"
“Inman's idea to add two more charities is another act that shows the risk of money being raised for one purpose to be diverted to another. For example, I raise money for an Israeli charity to pay for trips to the Holy Land, but then decide that half the money should go to Palestinian orphans, or more disturbingly, to Hezbollah, which also has a charity wing. It's one more reason why IndieGoGo should not contract with agents like Inman who do not know that ‘adding charities’ to a campaign is obviously ‘bait and switch’ false advertising.”
Yeah, because everyone is just so sure that Inman's now going to add two charities that involve speeding up cancer causing agents and killing off bears to counter his original two charities.
Earlier this morning we wrote about Charles Carreon suing Matthew Inman, IndieGoGo, the National Wildlife Federation and the American Cancer Society. At that time, all anyone had was the summary of the lawsuit as written by Courthouse News Service. Now, Carreon has posted the filing to his own website (with portions redacted) and the full version is now available via PACER. I've attached the officially filed version below. Rather than reveal new theories that we had missed in our original analysis, it would appear that our initial thoughts were dead on. This case is just begging to be anti-SLAPPed out of existence, in which case Carreon may find himself on the hook for significant legal fees.
When I was writing about the original case, I went looking through California's regulations on charities, and couldn't find anything that would impact Inman or IndieGoGo and all I came across was this law from this page on the California Attorney's General website. But I couldn't see how that specifically applied to Inman or IndieGoGo, since it seemed to be focused (a) on charities themselves or (b) on professional fundraisers (i.e., people hired to fundraise on a charity's behalf). It did not seem to apply to people who just tried to raise money which they promised to donate to a charity. However, that is the law that Carreon is relying on. Carreon seems to try to twist the definition of a "commercial fundraiser" to make it apply to Inman and IndieGoGo, but it's a pretty massive stretch. Inman isn't doing this "for compensation," so the law doesn't seem to apply to him. IndieGoGo is just the platform, but isn't doing the soliciting or directly touching the funds. The law is designed for an entirely different purpose.
And even if, somehow, a court actually believes that this law applies here, you might wonder how it's possible that Carreon has any standing to sue whatsoever. The fundraiser has nothing to do with him (it was about Funnyjunk, but remember that Carreon is suing on his own behalf, not Funnyjunk's.). Carreon appears to just be suing because he's pissed off. Except, that Carreon thinks he found a loophole. He donated to the campaign himself in order to create standing:
Plaintiff is a contributor to the Bear Love campaign, and made his contribution with the intent to benefit the purposes of the NWF and the ACS. Plaintiff is acting on his own behalf and to protect the rights of all other contributors to the Bear Love campaign to have their reasonable expectation that 100% of the money they contributed would go to a charitable purpose. Plaintiff opposes the payment of any funds collected from the Bear Love campaign to Indiegogo, on the grounds that the contract between Indiegogo and Inman is an illegal contract that violates the Act, and its enforcement may be enjoined. Plaintiff opposes the payment of any funds to Inman because he is not a registered commercial fundraiser, because he failed to enter into a written contract with the Charitable Organization defendants, because the Bear Love campaign utilized false and deceptive statements and insinuations of bestiality on the part of Plaintiff and his client’s “mother,” all of which tends to bring the Charitable Defendants and the institution of public giving into disrepute.
Yeah. Once again, Carreon contributed to Inman's campaign for what appears to be the sole reason of using that as a way to get standing to sue. I'm somewhat stunned.
Also, how can he possibly blame the charities? Well, Carreon's lawsuit fails in that it never actually states a claim against the charities. Seriously. At one point in the explanation of the lawsuit, he does state the following, but never actually includes the charities in any of the actual claims:
Although the Charitable Organization defendants have notified by Plaintiff in writing about the fact that the “Bear Love” campaign alleged infra is being conducted by Inman and Indiegogo in violation of the Act, and that the campaign is being conducted in a manner that could cause public disparagement of the Charitable Organization defendants’s good name and good will, neither the ACS or the NWF have acted to disavow their association with the Bear Love campaign, thus lending their tacit approval to the use of their names to the Bear Love campaign.
Again, just for emphasis, I'll point out that even with this paragraph, Carreon fails to name either charity with any of the actual claims in the lawsuit. He does include them in part of the claim, by stating that they "have failed to perform their statutory duty to exercise authority over the Bear Love campaign," but still fails to directly assert the claim against them. Even if he somehow figured out a way to work them into one of the claims, this particular legal theory of not disavowing "their association" with Inman's campaign leading to "tacit approval" is pretty ridiculous as well, and not something I could see standing up in court.
Meanwhile, Carreon's theory that Inman "disparages the image of charitable fundraising" again seems to stretch all kinds of definitions and understanding of the internet. Basically, he relies on the fact that Inman likes to mock people he doesn't like. But that's entirely unrelated to the issues at hand. Furthermore, despite Inman and Inman's lawyer explaining (in great detail) to Carreon, earlier, that Inman has an ASCII pterodactyl on all pages of The Oatmeal's source code, Carreon spends an inordinate amount of space talking about how awful this is.
Inman has announced his vindictive response to his real and imagined enemies by posting, within the source code of all of the webpages on his main website, www.theoatmeal.com, the following image and text, depicting himself as a pterodactyl that will “ptero-you a new asshole.” A screencapture of the core of the source-code appears as follows:
Following the link to http://pterodactyl.me leads the Internet user to a page on TheOatmeal.com where a video created by Inman and Sarah Donner depicts Inman, in his character as a carnivorous, prehistoric flying reptile that first rips the intestines out of a man's anus, then flogs him with his entrails, then steals a pineapple from a boy, tears his head off, flings it a girl and knocks here head off, then grinds up the girl’s head up in a wood-chipper, blends it with the pineapple, and drinks the grisly cocktail
The filing then shows screenshots from the video in question, which we'll just embed here for your viewing pleasure:
Carreon tries to claim that these images actually incite Inman's followers into action:
Inman’s followers are by and large with technologically savvy young people eager to follow the
latest trend, who embrace Inman’s brutal ideology of “tearing you a new asshole.”
Seriously? Carreon is literally arguing that fans of a silly comic with cartoonishly ridiculous violence leads them to "embrace" this "brutal ideology?" Carreon really ought to spend more time online. Carreon repeatedly makes incredibly weak connections between Inman's cartoons, his online persona and the later hatred directed his way, but without any actual evidence.
Later in the lawsuit, Carreon again claims that Inman's statement that Funnyjunk "stole" images is "false and misleading." Whether or not that's true, it's irrelevant here. Funnyjunk is not a plaintiff in the lawsuit. He also goes off on Inman for "fighting
words, and incitements to commit cybervandalism, none of which are entitled to constitutional
protection." Neither of those make sense. It's nearly impossible to see how Inman's cartoons, as sophomoric as they might be, qualify under the standard legal definition of "fighting words" or any kind of incitement to violence. In fact, Inman has made no references inciting his audience to do anything other than give money to charities (which most people would consider a good thing).
Moving on... we've got the trademark and publicity rights claim. As expected, Carreon is asserting that various actions violate the trademark on his name and his publicity rights. The key is that someone set up a fake Twitter account in his name and tweeted various statements that might make Carreon look silly. Of course, reading some of the tweets, it seems rather obvious that the account is fake. For example, one of them talks about "backtracing" Inman's IP -- a rather obvious reference to the famous ya dun goofed internet meme. Also, as he had suggested in an interview on Friday, Carreon makes interesting leaps of logic in suggesting that Inman himself may have set up the fake account.
Then, finally, we have the "inciting and committing cybervandalism in the nature of trespass to chattels, false personation and identity theft." Here, he claims that the fact that his email address was made public was part of that incitement, claiming that he never made it public:
As noted above, Doe1 or Inman proliferated Plaintiff’s email address via a fake tweet made by “@Charles_Carreon.com.” Plaintiff had not posted the chas@charlescarreon.com email address anywhere on the Internet except where required by law and Internet regulations. (The email address appears on legal papers in PACER filings in cases where required by the rules of this and other U.S. District Courts; however, these filings are viewable only by PACER users. The email address was also used in the Whois registration database for various websites Plaintiff has registered for his benefit, and as by the authorized registrant/agent of various legal clients.) Inman or persons incited by Inman also proliferated the email address and Plaintiff’s home address on social networking websites, again for the malicious purpose of enabling cybervandalism.
Except... court filings are not only viewable to those with a PACER account. Filings with the court, if not under seal, are considered public documents and are often available from a variety of sources, including the Internet Archive and other places as well. Separately, if he didn't use an anonymizer, the whois info that includes his email address is public info. Furthermore, his address is available elsewhere online as well, including (um...) both the websites for the State Bar of California and the State Bar of Oregon. Oh, and the email address is also clearly stated in the version of the legal filing that Carreon posted to his own website. While he redacted his email address in the header, he did not within the text of the complaint. In other words, that address was widely available to the public already.
His second claim of cybervandalism was that someone tried to reset the password on his webhosting account:
On June 13, 2012, at 9:28 p.m., either Inman or one of the persons named as Does 1 – 100 engaged in the act of trespass to chattels, cracking the password on Plaintiff’s website at http://www.charlescarreon.com and requesting to reset the password. Fortunately, the intrusion discovered instantly by Plaintiff who was sitting looking at his computer screen when he received an email from the website software system, and was able to retain control of the website by immediately changing the password using the hyperlink in the email.
First of all, merely requesting a reset password is not "cracking the password." It's requesting a new password, which the user would not be able to act upon unless they had access to Carreon's email (and there is no indication that that happened). In fact, it appears that the password reset system worked as designed, in that Carreon was warned that someone wanted to reset the password. And, actually, the fact that Carreon admits to "using the hyperlink in the email" suggests that that could have been the real hack attempt. You should never change your password using a hyperlink sent to you in an email. You should always go directly to the site yourself and login and make the change. Normally, if you receive one of those reset emails and haven't tried to reset your password, you're supposed to ignore it so that the password doesn't get reset. Clicking on the link and changing a password that way makes one susceptible to phishing attacks.
Finally, Carreon notes that some idiots online have signed his email account up for various spam emails/newsletters. If true, that's pretty stupid on whoever signed him up for those kinds of things, and people really shouldn't do that. But claiming that's "cybervandalism" or anything that can or should be pinned on Inman (again, whose target was Funnyjunk, not Carreon) seems ridiculous in the extreme.
PayPal is pretty famous for the fact that almost no one likes it. It's why we're finally starting to see some alternatives springing up (or getting ready to spring up). And yet, it still seems to go out of its way to make bad decisions. The latest, via Consumerist, is that it completely shut down a charitable "secret santa" program that regretsy set up, all because the site used the "donate" button, rather than one of its other buttons. According to PayPal, only registered non-profits are supposed to use the donate button. Of course, rather than point this out to regretsy, it let a bunch of transactions go through, and was requiring that they all be reversed... though PayPal would keep the transaction fees (of course). Apparently, in the mind of PayPal, no one but a non-profit ever asked for donations for anything. Seriously, though, if PayPal has such strict rules for using the donation button, why not, um, make companies prove their status before they can set up a site using the donate button?
Either way, as can happen when someone in PR finally wakes up to what's happening online, the public response to this Grinch-like effort is that PayPal has agreed to back down. Of course, it shouldn't have taken a flood of negative publicity for PayPal to realize that it screwed up here.
We release our Citizenship Report at the same time as our Annual Financial Report to give our broad base of stakeholders a full view of Microsoft’s financial and non-financial performance. Corporate responsibility means more than returning value to shareholders – it means engaging with stakeholders to address our responsibilities in the areas of environmental, social and governance issues. We believe all corporations have, as part of their license to operate, a responsibility to contribute positively to society on a global scale. To quote our company’s founder, Bill Gates: "It takes more than great products to make a great company."
So let's just take a look at the things Microsoft has been doing to "contribute positively to society on a global scale". Here's one detail:
We have increased corporate charitable giving year-over-year since fiscal year 2008, despite economic challenges. Our employees volunteered more time—more than 380,000 hours in the U.S. alone. We also contributed more cash and in-kind support to nonprofits—$949 million globally.
In FY2011 we donated more than $844 million in software to 46,886 nonprofits in 113 countries/regions.The value of software we have donated globally since 1998 is more than $3.9 billion. The FY2011 value of software donated now includes employee software donations; previous years’ in-kind giving numbers do not.
This means that of the $949 million dollars "contributed" to nonprofits, $844 million -- 88% – was actually software, presumably Microsoft's, since it's unlikely it went out and bought it from competitors.
The fair market value is the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.
Now, I'm not suggesting that the people who put up the web page about Microsoft's contributions to nonprofits were following that definition exactly. But equally, it seems likely that the gist is the same: it's a kind of rough price that you'd usually find in normal markets selling the products in question. And those prices are almost certainly well above the cost of manufacturing, especially if the software was delivered online, or if multiple installations were permitted.
So the actual cost to Microsoft of that donated software is likely to be only a small fraction of the $844 million "fair market value" cited. This inevitably tempers our admiration for Microsoft's ten-figure generosity somewhat.
But there's something else. Microsoft wasn't just handing out a bunch of any old products: it was giving away mostly Windows and Office, judging by a table showing a breakdown by region. Both of these are well-known for the lock-in effects they produce: once you start installing applications and creating documents with them, it's quite hard to move to a completely different platform like Apple or GNU/Linux. Most people don't even try.
So these free copies not only cost Microsoft considerably less than the $844 million figure it used to calculate that near-billion dollar total for its corporate brochure, but it wasn't really altruistic at all. With hundreds of thousands of copies of Windows being distributed (417,030 were supplied for refurbished computers alone), there is a very high probability that Microsoft will be benefiting financially – and not just in terms of goodwill -- from upgrades and follow-on sales for many years to come.
Making copies available at zero or very low prices is something that Microsoft has done time and again whenever there was any danger of customers "defecting" to open source. For example, in 2009, Russia planned to deploy free software throughout its education system. That didn't happen, in part because Microsoft offered to license Windows for $30 a copy (article in Russian.) It's part of the rough and tumble of the highly-competitive software business.
Still, it's a little rich for a company as profitable as Microsoft to try to dress this up as “corporate charitable giving.” It's really nothing of the kind: it's marketing, pure and simple, and Microsoft should be big enough to describe it as such.
Really not sure what to make of this. A typical patent trolling type organization named Azure Networks filed two separate lawsuits right before Christmas, against a bunch of semiconductor companies, including Texas Instruments, Freescale, Atmel, Alereon, Samsung, Synopsis and others. At first glance, these lawsuits seem pretty typical: filed in Eastern Texas, filed by a small company whose only purpose is to sue, suing a bunch of big tech companies who actually do something. It meets all the standard checkmarks of these types of lawsuits.
But some folks have noticed one oddity: named as co-plaintiff along with Azure Networks is a local Texas charity. The Tri-County Excelsior Foundation is named as a plaintiff, with a note that it is a non-profit corporation that is "a supporting organization" to a charity called Casa of Harrison County. Casa of Harrison County appears to be a perfectly admirable charity -- based in Marshall Texas -- focused on training "community volunteers to be advocates for abused and neglected children in the custody of Child Protective Services."
So why are they a co-plaintiff in the lawsuit? That's not clear at all. I've embedded one of the two lawsuits below. It says that Tri-County Excelsior Foundation is a plaintiff, but does not explain its relationship to the patent. The filing does say that Azure has a license on the patent, but does not say from whom. The patent in question (7,020,501) lists BBNT Solutions LLC as the assignee, but it's possible that the patent has since been handed off to others.
I have no idea if the patent is valid or not. I have no idea if the companies are infringing or not. But it does seem... odd, to see a non-profit charity supposedly focused on helping abused children, somehow getting involved in a typical patent trolling lawsuit.
A few months back we had a few submissions over some claims by the "Susan G. Komen for the Cure" operation was being a trademark bully, and threatening other charities that were using the color pink. SGK is the big name in raising money for breast cancer research, but a new article highlights how it's also spending over a million dollars a year being a trademark bully: specifically going after anyone else who uses the phrase "for the cure" or "for a cure" as part of their own charitable fundraising. The organization claims that it "needs" to do this to protect its trademark, but as we've pointed out time and time again, that's simply not true. First, you could argue that raising money for charity is not "use in commerce" and thus not deserving of a trademark. On top of that, the phrase "for the cure" certainly sounds descriptive, and again perhaps doesn't deserve a trademark
But, even assuming that the trademark itself is valid, there are all sorts of ways it could deal with other charities using that phrase without acting like a legal bully. It could simply agree to license the mark at no cost to other legitimate charities. SGK's claim, of course, is that it doesn't want the phrase to get sullied by unscrupulous organizations, but that doesn't mean it needs to pull out the legal guns when a legitimate charity comes along. Just let them use the damn phrase, and let everyone help raise money for charity, rather than legal bills.
A few weeks back, the always excellent Planet Money podcast played parts of a debate held at the Clinton Global Initiative between famed microfinance guru Muhammad Yunus and successful microfinance entrepreneur Vikram Akula (moderated by Planet Money host Adam Davidson), considering whether or not a for-profit microfinance effort can really work in terms of enabling better financial opportunities for the poor. Yunus argued that a for-profit effort simply cannot do good. Since it has a profit motive and outside investors, its efforts will always be on transferring money away from the poor to those investors.
Akula disagreed, strongly, by pointing out that you can align both of their interests, and his company appears to have successfully done so. In the talk, he gives an example of the fact that they only lend money to women and they charge well-below market interest rates. He also notes that, unlike most banks, they don't pay those in charge of lending the money based on how much money they lend out (or make). The idea there, is that they want the people there to figure out the right amount that the person needs, rather than creating incentives for them to try to get the person to take more, to make their own numbers look good.
Now, he argues that, compared to other banks, you could say that his firm, SKS Microfinance, is leaving money on the table, but he doesn't see it that way. The woman who takes out a small loan and successfully pays it back this time, can come back later, when the timing is appropriate and take out a larger loan, which might never have happened if she had been pushed into a bigger loan earlier, or charged much higher interest rates.
And, while no one specifically says it in the podcast, this is a much bigger point than Yunnus seems to recognize. There are two factors that Yunnus doesn't seem to consider in condemning all for-profit microfinance efforts: (1) this is a non-zero sum game and (2) this is a multi-round game (i.e., there's a long-term strategy horizon). Yunnus is right that for-profit charities probably can't work in a situation that is a zero sum game, or in which the time horizon is very short, such that there are unlikely to be repeat customers. But, just taking a straightforward game theory look at what Akula and SKS are seeing, they can increase the overall pie more efficiently in a for-profit setup. It's not "taking away" from the poor. It's expanding the overall economic pie for everyone, including investors, and part of the way that's done is by focusing on building strong relationships with those using the service. That means, the temptation to screw them over is tempered by the incentives to be fair to encourage that long-term relationship that pays off (for everyone) over the life of the relationship.
I have to admit that I was a bit disappointed in Yunus, who is so often held up as a financial genius for his microfinance theories. As the podcast makes clear, his focus involves heavy government involvement and regulation to create a special type of community-owned microfinance bank, which apparently works okay for the community he's in, in Bangladesh, but that doesn't mean that a for-profit microfinance operation can't help the poor quite a lot, while also helping investors.
Rob H was the first of a few of you to send in the story of how a music publishing company, Bourne Music Publishers, threatened 10 year-old actress Bethany Hare, for creating a short video of her acting as Charlie Chaplin accompanied by her singing the song Smile, which was the theme for Chaplin's 1936 film Modern Times. Hale had created the video and posted it to the charity site JustGiving as part of a campaign to raise money for a hospice. Modern times indeed. Of course, when Chaplin wrote the song, he was given a government-granted monopoly that he knew would put his work in the public domain by now. Until the government and lobbyists extended copyright again and again and again.
Either way, Bourne Music Publishers apparently doesn't care much for charity. It demanded $2,000, plus another $200 every time she performed the song. That certainly would take away from the hospice that she was trying to raise money for, so now her Chaplin appreciation film is a Chaplin-style silent film instead.
