Vintage Filings Legal Blog

Click Forensics today released industry pay-per-click (PPC) fraud figures for the first quarter 2009 from the search advertising industry’s leading independent click fraud reporting service – the Click Fraud Index. Now in its fourth year, the Click Fraud Index provides statistically significant industry PPC data collected from online advertising campaigns for both large and small advertisers across all leading search engines. Traffic across more than 300 ad networks is also reflected in the data. Key findings for Q1 2009 include:

• The overall industry average click fraud rate was 13.8 percent for Q1 2009. That’s down from 17.1 percent reported for Q4 2008 and from the 16.3 percent rate reported for Q1 2008.
• Click fraud traffic from malicious scripted programs increased in Q1 2009. Unlike botnets or malware, these new threats exist as simple Javascript programs that execute upon a page view or site visit. Ad networks were found to be especially vulnerable to these attacks during the quarter.
• In Q1 2009, the greatest percentage of click fraud originating from countries outside the U.S. came from Canada, United Kingdom and Germany.

“It appears that the drop in keyword Cost Per Clicks (CPCs) and the progress Yahoo! and Google made blocking click fraud from botnet sources contributed to the decline in the overall click fraud rate this quarter,” said Tom Cuthbert, president of Click Forensics. “However, we also saw an increase in scripted attacks aimed at ad networks, which are historically more vulnerable to such threats. Advertisers should pay close attention to traffic from these sources over the next year.”

The data also indicated that click fraud schemes are increasingly complex, sophisticated, and more difficult to detect. One new type of fraud discovered this quarter was perpetrated by malicious scripts that execute when a visitor views a web page disguised as relevant content or search results. The script initiates “Zero-iframe” or off-screen clicks that route the visitor session through an alias referrer website, and on to unsuspecting advertisers who pay for the phantom click. All this occurs transparently to the offending site’s visitor; they never see the ad or visit the advertiser, and their computer is not infected with any type of malware or botnet.

Adaptive Solutions is bringing their solutions to Washington D.C.  Last month, Adaptive Solutions hired business development manager John Kairis to spearhead Adaptive Solutions’ launch into the Washington D.C. legal market in the spring of 2009.

“ASI has always been a legal-specific IT firm, but we originally limited our marketing activities to the Philadelphia area,” said Chuck Davis, president of ASI. “Last year, we were met with immediate success when we expanded to the New York City market; it was obvious to us that there is a real need for legal-specific IT services in top-tier legal markets in the Mid-Atlantic region.”

ASI originally decided to expand its market reach beyond Philadelphia in response to the request of three key partners; i365, Interwoven, and Dell EqualLogic requested that their “go-to” legal integration partners, including, ASI, make themselves available in top-tier legal markets on the East Coast. As an essential partner to each of these companies, ASI has responded with a market presence in New York and now D.C.

“Despite the demand in the legal market, there are not too many IT firms in a position to expand at this point.” Davis continued. “We’re thrilled to be in a position to bring our services, partnerships and products to D.C. firms and legal departments.”

The legal industry has gone through a difficult time during the current recession, to reveal some of the details IntApp announced the publication of the 2009 Law Firm Risk Survey Report, an industry study presenting findings collected from over 100 participating law firms.

Sponsored by IntApp, the survey was produced by the Risk Roundtable Initiative, an industry association that organizes events and programs for law firm risk stakeholders designed to foster dialogue, education and the advancement of industry best practices. Over 600 risk professionals from the 250 largest US-based and the 30 largest Canadian-based law firms were invited to participate.

The Law Firm Risk Survey focuses on firm risk management policies, practices and priorities. It examines specific issues including new business intake, attorney lateral hiring and departures, confidentiality enforcement, internal education, and compliance tracking and verification. The published survey report provides quantitative summaries of overall group response data, as well as samplings of individual responses to questions seeking freeform comments.

Key Findings of the Survey Report:

• Top law firm risk concerns include business intake, regulatory compliance and confidentiality protection.
• Nearly two-thirds of firms vest ultimate responsibility for risk management with a single individual, while others rely on committee-based or decentralized approaches.
• The majority of firms have documented risk management policies. However, most firms do not centrally store and manage their written policies.
• One-third of firms perform formal internal risk audits to confirm compliance with internal policies and standards.
• Clients are increasingly raising concerns about the steps firms take to ensure the confidentiality of sensitive business information. Nearly all firms have been asked by clients to restrict and track internal firm access to sensitive information.

A national survey of American white collar workers found that while technology is widely embraced among working professionals, significant gaps exist among generations regarding its use and application in the workplace. The newly released Technology Gap Survey found generational differences in the effect of technology on workplace etiquette, the blurring boundaries between personal and professional tasks, and the impact of technology overload. The survey – commissioned by LexisNexis, examined the impact of technology in the workplace. It compared technology and software usage among generations of working professionals, including Boomers (ages 44-60), Generation X (ages 29-43) and Generation Y (ages 28 and younger).

Impact on Office Etiquette

According to the survey, there are vast discrepancies between generations on what the appropriate use of technology and software is, potentially causing tensions in the workplace. For example:

• While over two-thirds of all Boomers agree that Personal Digital Assistants (PDAs, such as BlackBerries, Palm Treos) and mobile phones contribute to a decline in proper workplace etiquette, and believe the use of a laptop during in-person meetings is “distracting,” less than half of Gen Y workers agree.
• Only seventeen percent of Boomers believe using laptops or PDAs during in-person meetings is “efficient,” while more than one third of Gen Y do.
• Only twenty-eight percent of Boomers think blogging about work-related issues is acceptable, while forty percent of Gen Y workers do.

Blurred Boundaries Between Work & Home

According to the survey’s findings, new technologies have blurred the lines between personal and professional tasks – especially online technologies such as blogs and social networking sites. The survey found:

• Gen Y workers spend an average of 10.6 hours a day accessing social networking sites, news Web sites, blogs, Internet forums, and multimedia sharing Web sites, versus 5.6 hours reported by Boomers.
• Sixty-two percent of Gen Y professionals report accessing a social networking site from work, versus only fourteen percent of Boomers.
• Thirty nine-percent of Gen Y workers report using gaming programs at work, versus fourteen percent of Boomers.

Technology Overload

According to the survey, more than half of working professionals believe that the amount of technology available encourages “too much” multi-tasking. Respondents were asked to report on how much time they spent on each of four types of applications in an average work day (e-mail; internet browsers, instant messaging, and Microsoft Office). The average time reported for “using” each application every day added up to a total of 15.9 hours, far exceeding the standard 8-hour work day.

• This suggests that workers keep many different applications open at the same time, and access them concurrently.
• The multi-tasking phenomenon has a dramatic generational skew, with Gen Y logging a cumulative total of 22.9 hours across all these applications in a work day, versus 10.3 for Boomers.

“The results of the Technology Gap Survey suggest a real wake-up call for today’s senior management – the Boomer generation,” said Mike Walsh, CEO of LexisNexis U.S. Legal Markets. “In today’s evolving professional world, Boomers need to acknowledge that a technology gap among generations exists, and they must find ways to maximize productivity by implementing effective workflow solutions and integrated resources that address the challenges they face.”

Potential Solutions for Managers

Walsh said that in order for companies to ensure maximum efficiency and productivity, technologies that capitalize on these emerging trends should be implemented. He offered potential solutions, which include:

• Investing in technologies and workflow solutions that enhance workplace productivity rather than increase multi-tasking.
• Establishing clear guidelines around acceptable uses of technology in the workplace, as well as providing training on new technologies.
• Acknowledging and addressing the significant impact of social networking by investing in professional networking solutions.

The battle between traditional and online media continues.  McPheters & Company has released results of a study conducted in co-operation with Condé Nast and CBS Vision which explored the relative effectiveness of ads on television, in magazines, and on the Internet. The study represents an unusual example of collaboration on the part of companies with competing media interests.

The study used McPheters & Company’s AdWorks™ methodology to provide comparable measures of ad effectiveness across multiple media, using 30-second TV ads, full-page 4-color magazine ads, and Internet banner ads in standard sizes. Additionally, eye-tracking software was used to determine whether – and under what circumstances – Internet ads were actually seen by respondents. The work was conducted in CBS Vision’s state-of-the-art Television City facilities at the MGM Grand in Las Vegas.

Matched groups of respondents were recruited to spend 30 minutes with a single medium in a laboratory setting. They either watched a choice of sit-coms, read a magazine they selected, or surfed the Internet at will. At the end of the period, they filled out similar online surveys that asked whether they recalled seeing 4 ads which appeared in the medium they consumed; in order to establish the level of over-claiming, which is known to vary by medium, they were also asked whether they recalled seeing 4 ads that had not appeared. These results were then used to calculate net recall or ad absorption for each medium.

Among the major findings were:

• Within a half hour, magazines effectively delivered more than twice the number of ad impressions as TV and more than 6 times those delivered online
• Though TV doesn’t deliver as many ads per half hour as do magazines, net recall of TV ads was almost twice that of magazine ads; magazines in turn had ad recall almost three times that of Internet banner ads
• 85% of Internet ads served appeared on-screen and could be identified by brand
• Among web users, 63% of banner ads were not seen. Respondents’ eyes passed over 37% of the Internet ads and stopped on slightly less than a third
• For Internet ads, almost all net recall could be attributed to ads that were seen
• Internet video ads appeared much less frequently than banner ads, and their exposure skewed heavily towards young men. When they did appear they were twice as likely to be seen as banner ads.

When study results were used in combination with other information on probability of exposure, a full-page 4-color magazine ad was determined to have 83% of the value of a 30-second television commercial, while a typical Internet banner ad has 16% of the value.

Take-Two Interactive Software has announced that it entered into two separate settlement agreements with the SEC and the District Attorney, New York County, both of which relate to previously disclosed investigations of the Company’s historical stock option granting practices.

Without admitting or denying the SEC’s allegations, the Company has agreed to pay a civil penalty of $3.0 million, and has stipulated to an injunction against future violations of certain provisions of the federal securities laws. The settlement is subject to approval by the United States District Court for the Southern District of New York. If court approval is obtained, the settlement will conclude the SEC’s investigation of this matter with respect to the Company.

As part of the settlement agreement with the District Attorney, the Company acknowledged that certain of its former directors and officers engaged in certain illegal behaviors related to the historical granting of stock options, and the District Attorney agreed not to prosecute the Company or its corporate subsidiaries for conduct related thereto. In addition, the Company agreed to pay $300,000 to the District Attorney for reimbursement of costs related to the District Attorney’s investigation, to undergo a review of its corporate governance structure by external legal counsel, and to hire an administrator for its stock plan.

Take-Two previously accrued the estimated expense for these settlements in its fourth quarter of fiscal 2008. The other civil litigation related to the Company’s historical stock option granting practices remains outstanding.

“We are pleased to have reached a settlement with both the SEC and District Attorney with respect to the Company’s historical stock option granting practices,” said Strauss Zelnick, Chairman of Take-Two. “Resolving this issue has been a key objective for Take-Two since the current management team took office in early 2007, and we are gratified to have put this matter behind us.”

Ever wonder which of your online ads are generating the most exposure?  Well, Lotame, a platform enabling targeted advertising to customizable audiences through social data, today revealed surprising results of a recent study comparing the impact of different online ads. The study, based on 148.3 million ads served in 2009, demonstrated a distinct advantage for 300 x 250 “medium rectangle” ads over the 728 x 90 “leaderboard” format typically found at the top of a page, and 160 x 600 “skyscraper” ads.

While relative advertising rates for the three ad sizes vary according to the Website, page position and other factors, few if any reflect the distinct differences in the average time spent viewing each ad size. Of the ads studied by Lotame, internet users spent an average of 13 seconds viewing each medium rectangle, 5.4 seconds viewing each leaderboard, and 1.9 seconds viewing each skyscraper.

“Advertisers plan campaigns and buy ads based on traditionally accepted criteria including size and placement, but the data clearly shows that the rates commonly charged for each ad type don’t accurately reflect the impact delivered to the audience,” said Scott Hoffman, CMO for Lotame. “Thanks to the same technology that uncovered these findings, Lotame can eliminate questions around what ad types deliver the most value and help advertisers design campaigns that deliver demonstrable impact.”

In order to accurately measure the impact of the time spent with an ad, Lotame’s Exposure Tracker technology counts the time that a user actually spends viewing an ad without counting time when the ad is obscured, minimized or scrolled out of view. By accurately monitoring and combining the time each user spends with the ad in plain sight, Lotame can measure the actual impact on the desired audience. In this way, Time Spent removes the single biggest flaw of traditional display advertising – the fact that an “impression” may not make any impression at all.

The $4.5 billion in matching funds allocated to “Electricity Delivery and Energy Reliability” by the American Recovery and Reinvestment Act (ARRA) includes a significant boost to “smart grid” and smart metering initiatives, aimed at updating the seriously ageing US electrical infrastructure.

“ABI Research believes that the rapid injection of capital to be provided by the ARRA will solidify and encourage more investment in smart metering and the smart grid,” says senior analyst Sam Lucero.“

Many utilities were already implementing plans to upgrade distribution and metering infrastructure, and as regulated industries with rate recovery mechanisms in place, electrical utilities have been somewhat insulated from the worst shocks of the recent economic turmoil. So, says Lucero, “The new federal funding is not an order-of-magnitude game changer, but it will certainly help to encourage and accelerate new smart grid plans, and reinforce those already in place.”

Who will benefit from these provisions of the ARRA and the resulting boost to smart grid and smart metering? There are winners on all sides.

Platform-A’s Business Intelligence organization, in partnership with IRI has released the results of a new study on trends in consumer couponing with interesting results. Based on input from more than 36,000 IRI panelists gathered in September, 2008, the study gauged consumer usage of traditional newspaper coupons and interest in digitally distributed online coupons.

The research comes at a critical juncture, when American families are extremely value-focused and eager to stretch their buying power, yet newspaper circulation (and thus the traditional vehicle for coupons) is in steep decline.

“This data highlights a number of trends that are converging to make online couponing an appealing option for CPG manufacturers,” says Mark Ellis, Senior Vice-President, AOL / Platform-A. “We have an economy that makes coupons much more relevant to the average consumer, a rising generation of families totally at home with the Internet, and an overall decline of the newspaper and its Sunday circular distribution. There’s clearly a huge window of opportunity here.”

The study reports that more than 90 million consumers (78% of retail shoppers) currently use newspaper coupons, with nearly one out of every four of the newspaper coupon clippers likely to be at least 65 years old. It also revealed that nearly four out of every 10 shoppers – a total of 40 million consumers – would be very likely to use coupons accessed online. Not surprisingly, the younger the consumer, the more comfortable they were with the idea of accessing coupons online:

• The youngest market segments are the most receptive to online coupon offers, with 51% of 18-24 year-old shoppers indicating that they would be very likely to use coupons presented to them online.
• While historically ambivalent to traditional coupons, younger couples are the most likely life-stage group to use online coupons, indicating an opportunity to influence product choices within this segment.
• Young couples without children are among the respondents most likely to use a coupon they found online, followed by shoppers with younger children.

Value-focused promotion is clearly the strategy of choice right now in the CPG market, evident in the fact that eight out of Platform-A’s top 10 CPG clients use value-based messaging in their online advertising. And, many of these advertisers are already taking advantage of the innovative approaches to couponing available online, such as AOL’s Shortcuts.com. Launched in 2008, the site allows consumers to apply online coupon promotions directly to their grocery loyalty cards, making coupon discounts paperless and automatic at checkout.

“What’s particularly remarkable about the study results is how open young people are to the idea of using coupons online – even though clipping coupons from the newspaper really hasn’t been their thing,” adds J. P. Beauchamp, senior vice president, IRI Consumer & Shopper Insights. “I think we’ll be seeing CPG manufacturers jumping on this trend – using online coupons to court a new generation of consumers and build loyalty during these cost-conscious times.”

Metabolic Research announced that it has entered into a Settlement Agreement with David P. Summers.  Under the terms of the Settlement Agreement, Mr. Summers and MTBR agreed to dismiss the claims filed against each other with prejudice and Mr. Summers resigned as a Director and Chief Executive Officer of MTBR and his employment agreement was terminated.

Tia Owen, Chief Operating Officer, also announced the appointment of Robert Bakker and KC Quintana to serve on MTBR’s Board of Directors until the next annual stockholders’ meeting. Mr. Bakker also has been named President and Chief Executive Officer of MTBR.

Mr. Quintana developed the current MTBR marketing program and has personally enrolled all of the company’s star athlete spokespeople. Mr. Bakker, while serving as Vice President of National Sales for MTBR, developed General Nutrition Centers (GNC) as a retail outlet for the company products. He will continue to manage the GNC account in addition to his new duties.

Owen stated, “With the addition of Robert Bakker and KC Quintana to the management team, we believe that we are now well positioned to build our Stemulite™ brand of nutritional supplements into a recognized fitness product line as a healthy alternative to steroids.”