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Live Cam Rules (and Regs)

Gregory Piccionelli
Live adult videoconferencing is big, and getting bigger. Online consumers now purchase enough live cam show minutes to support thousands of regular live cam performers each day.

Capitalizing on this ever-increasing demand for live adult content, more and more pay sites are including live chat upsell options.

Additionally, many of the most recognizable adult brand name companies now have their own private labeled version of a live chat site provided by one of the major live chat companies, such as Video Secrets.

But among live chat providers and promoters it’s no secret that the booming live cam business is one of the adult entertainment industry’s best performing market segments. So it’s not surprising that an increasing number of adult companies are either starting their own live chat service or seriously exploring the possibility of doing so.

But potential revenues are not the only factor motivating traditional adult content companies to explore live adult chat. The increasing demand for live adult chat is now providing many adult companies dependent on recorded content business models with welcomed opportunities to add additional income streams that are much less vulnerable to piracy.

But as big as live chat is today, it is only likely to grow in the future as more and more computers and other devices, such as mobile phones, provide built-in live video chat capability. It is also likely that live chat will also get another boost in the near future as technologies providing performers with remote genital manipulation ability, such as AEBN’s Real Touch, become a functional part of live cam shows.

Because live adult video conferencing has become a integral part of the online adult entertainment landscape, and more and more adult companies will soon have some direct or indirect association with live adult chat services, it is becoming increasingly important for adult entrepreneurs to become aware that live adult content is subject to all of the adult regulations and intellectual property laws associated with recorded content distribution.

Moreover, it is also critically important for those that provide or promote live adult chat services to understand exactly how these laws apply to the medium of live adult videoconferencing.

If you or your company are in the business of providing or marketing live adult chat services or you are considering doing so, the following are a few of the more important legal issues that you should be aware of:

Adult chat performers must not be minors. All live chat performances are subject to the child pornography laws of the countries in which the subject performance is created and, generally, also the countries in which the performance is viewed.

Needless to say given the enormous potential liability associated with the creation, transmission and possession of child pornography, this is, in my opinion, the single most important legal consideration associated with the providing or promoting of any live adult chat service.

And it’s not just a matter for U.S. authorities.

The U.S. and many other countries are parties to extradition treaties covering violations of a member country’s child pornography laws. Regardless of whether a company is operating its own live cam business or affiliating with another, great care must be exercised to be sure appropriate age verification procedures are in place.

Adult chat shows produced in or transmitted to the U.S. must be compliant with all 2257 regulations. I am surprised by how many providers and affiliates of live adult cam shows apparently don’t know that all of the federal record keeping and labeling laws, known as the “2257 regulations” (18 U.S.C. §§2257 and 2257A, and 28 CFR 75 et seq.) apply to live adult cam shows, as well as, to transmitted recordings of the live shows.

Nevertheless, all sexually explicit cam shows are subject to all of the 2257 regulations, regardless of whether the shows depict actual or simulated sexual acts, such as masturbation or just lascivious exhibition of the genitals or pubic area (clothed or unclothed).

For example, 28 CFR 75. 2(a)(1), which, addresses the 2257 regulations’ requirement that a copy of the subject depiction be separately maintained by primary and secondary producers in their 2257 records system states:

“For any performer in a depiction performed live on the Internet, the records shall include a copy of the depiction with running-time sufficient to identify the performer in the depiction and to associate the performer with the records needed to confirm his or her age.”

Since careful consideration must be given to whether and how live adult cam shows are provided in compliance with the 2257 regulations, professional evaluation of the creation and storage methodology of a live chat company’s 2257 regulations records should be performed by an experienced adult entertainment attorney before providing any live sex cam services.

And if your company markets another company’s live adult chat or contracts with a live chat provider for a private labeled version of the provider’s services, it is important to obtain clear warranties that the live adult chat provider is, and will at all times be, in full compliance with all the applicable 2257 regulations.

All the obscenity laws apply to adult live cam shows. Live adult chat shows are subject to federal and state obscenity laws. As such, all the potential liability associated with distribution of obscene matter applies to live video conferencing services.

This includes the potential for lengthy prison sentences, huge fines and forfeiture of the entire company.

The application of the obscenity laws also means that promoters could be liable vicariously, for example, for aiding and abetting the distribution of obscene matter if one or more of the live chat shows is found to be obscene.

Therefore, both providers and promoters of live adult chat are well-advised to speak to qualified adult entertainment counsel regarding how best to address the issue of possible obscenity prosecutions associated with live adult chat.

Patents and live adult chat technologies. The transmission of live adult chat involves the use of intellectual property. For example, many of the technologies used to provide live video are, or are potentially, subject to domestic and/or foreign patents.

This can result in costly litigation for adult companies providing or promoting live video chat, regardless of whether the technology they use is ultimately found to be non-infringing.

One company, Joao Control & Monitoring Systems of Texas LLC, for example, sued a number of adult live video providers, claiming patent rights to online live video technology.

At the time of this writing the case is ongoing, but some of the adult companies have settled with the patent owner.

Some live chat systems that limit where the show is viewable (for example to accommodate performers that don’t want their shows viewable in their home town) may infringe other patents.

Other intellectual property rights. Like patents, other forms of intellectual property, such as copyrights, and trademarks, are also involved in the providing of live adult chat services.

For example, if a performer provides a live sex show via an adult chat service while using a product that bears a famous trademark, such a Barbie® doll, the owner of the mark, in this example, Mattel, may be entitled to bring an action against the cam service provider on the ground that Mattel’s famous mark is being tarnished by the association of the mark with the live sex show.

Also appropriate permissions and rights must be properly obtained from performers and others providing creative input into live chat shows. Rights must be cleared, for example, for anything covered by copyright involved in or associated with live chat.

For example, use of music without permission in, or even in the background of, a live chat show can also result in the infringement of copyrights in the music.

One final thought: I think that in the near future live adult video content and the various business models that exploit it will evolve into the largest and most profitable segment of the online adult entertainment industry.

But as usual, where there’s money there will almost certainly be litigation, governmental regulation, and law enforcement.

Therefore, for those about to embark on an adventure down the Live Cam Turnpike on the Information Superhighway in search of cyber-riches, remember that the road is still under construction, and you might want to bring your lawyer.

Gregory A. Piccionelli is an intellectual property and adult entertainment attorney experienced in Internet matters. He can be reached at Piccionelli & Sarno at (805) 497-5886 or greg@ piccionellisarno.com.

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