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from Local Attorney, Michael H. Wasserman

Wednesday, February 18, 2009

Jones Day: Block Shopper's Chop Blocker ?

Blockshopper has been around Chicago for several years now, and recently rolled out a significant expansion of both its local and national coverages. I first wrote about them a year ago.

The beauty of the site is clearly in the eye of the beholder. If you want to know (even more about) who bought the house up the street (and what they paid), the site is just the cat's pajamas. If you just bought a house and want to hold on to a hopeful thread of a delusional belief that there is still a conceptual right to privacy in such matters, the site is a veritable nightmare.

At the end of the day, you really have to hand it to the folks who launched the website. They only publish data already available to the public at large, so its not like they are creating anything new or showing the world anything that the world doesn't already have access to. They are simply aggregating it in a way that no one has before them.

What can the common man do? Not much. Which is why we have lawyers.

Credit the suits at Jones Day (I was going to link to their website just there but elected not too...read on to see why) for at least a small victory over the reviled real estate tattlers.

Here are the background details from the "Citizen Media Law Project"

Founded in 2006, BlockShopper.com is a start-up local online real estate news service covering Chicago, South Florida, Las Vegas, and St. Louis. Its reporting staff is made up of ex-print journalists who collect public real estate sales data, then use information in the public domain (e.g. company web sites) to write news stories about recent transactions. BlockShopper currently produces upwards of 1,000 stories per month and has produced more than 8,000 since its founding, many of which appear in print newspapers as part of content-sharing partnerships with companies like Tribune. Three of those stories, all on BlockShopper's Chicago web site, reported the real estate transactions of partners and associates from Jones Day, the large international law firm.

Jones Day sued BlockShopper.com on Aug. 12, 2008 in federal court in Illinois. The complaint alleges that Blockshopper.com infringed and diluted the firm's service mark and violated state trademark and unfair competition laws by using the word "Jones Day" when referring to the real estate transactions of Jones Day attorneys, linking to its site and using lawyers’ photos from its site. The firm contends that these activities creates the false impression that Jones Day is affiliated with or sponsors BlockShopper.com.

Jones Day sought a temporary restraining order preventing BlockShopper from writing about its lawyers or linking to its web site. BlockShopper agreed to take down the three stories temporarily, to avoid the expense of arguing both a TRO and then
the complaint itself against a large law firm.

Blockshopper says it spent more than $110,000 defending itself against the lawsuit, which settled last week. "They had no shot at winning, but they were going to bleed us dry," said co-founder Brian Timpone. Cleveland Plain-Dealer.

Under the settlement, Blockshopper can continue to publish links to Jones Day but they can't be "embedded links." Those are defined as hyperlinks that are placed on a word or name. Instead, BlockShopper will have to place the Web address next to references to the firm. In other words, instead of writing Daniel P. Malone Jr. is an associate in the Chicago office of Jones Day," BlockShopper must write "Malone (www.jonesday.com/dpmalone) is an associate . ..

So, in the end, what did Jones Day accomplish? The bloodsucking lawyers forced the
evil website gossips to spend $100,000 plus in legal fees. (Heaven alone knows what they charged off internally for their own efforts). They had the "offending" entries removed from the web site for a period of months. They forced a change in the type of hyper-links that the B-S can use.

Hoo hah. Good work boys. Justice served. I know I'll sleep better tonight.

More Good News for Buyers - for the rest of us? not so much...

Downtown 2008 4th quarter condo sales cratered. As the kids might say, Duh!

Lets try to quantify that. According to Crain's, quarterly sales were actually negative 253 for the quarter. Put another way, more buyers walked away from contract than signed new ones. For the entire year, only 644 new construction condos sold. Compare that to 2007 when 3,724 units sold or 2005 (the market peak) when 8,162 units closed.

So where is the good news for buyers? Another 4,734 condos are expected to be completed this year downtown. This is on top of thousands of other condos that are completed but haven’t yet sold.

Developers are going to be stressed to the max, trying to sell off unsold units. Their lender's are going to start pressuring for loan repayments. The likelihood of developer defaults and foreclosures seems pretty strong.

Then consider the folks who did not walk away from their downtown condo contracts. A great many were "investors" who wanted to buy and flip. Those speculators are out there too, also hoping to unload their properties. As soon as possible.

Prices are going to drop. Downtown Buyers are going to see (I predict) some truly wonderful opportunities.

What do you think?