Intellectual Property Law Blog

By Edwin Komen

Blehm v. Jacobs, 10th Cir., No. 11-1479, December 27, 2012 

Some appellate decisions are worth examining because they plow new ground. Others serve to explain the ground that was plowed. This decision – dealing with substantial similarity (or lack thereof) between two sets of stick figures – is among the latter.

By Edwin Komen

On Friday afternoon, June 15, 2012, U.S. District Court Judge Gary Allen Feess, Central District of California in Los Angeles, denied CBS Broadcasting’s application for a temporary restraining order that would have prevented ABC from airing the premier broadcast of its new reality series “Glass House”. CBS complained that “Glass House” infringed the copyright in its long-running “Big Brother” series. Both featured contestants isolated in a confined space competing for prizes, building alliances and fighting with each other while they are systematically voted out of the competition. Judge Feess described these elements as “commonplace”. In doing so, Judge Feess dealt another blow to the admittedly fragile protection for one of television’s most valued commodities…a popular, highly marketable format capable of being translated and locally re-formatted for domestic consumption in local television markets around the world. The frustration of format owners may have well been summarized by Judge Feess, who observed, “When I first heard of Big Brother, I thought it sounded like Survivor in a house.”[1]
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By Edwin Komen

The Copyright Office recently published two little-noticed, but potentially far-reaching, announcements in the Federal Register. Collectively they tend to restrict the definitions of “claimant” and “compilation” for purposes of copyright registration. The first, noticed as a rulemaking subject to public comment, issued on May 17, 2012, 77 Fed. Reg. 29257 with written comments due by July 16, 2012 and reply comments due by August 15, 2012. The second is a Statement of Policy, with no right of comment, effective as published on June 22, 2012, 77 Fed. Reg. 37605. Although the Copyright Office does not adjudicate issues of copyrightability, its determinations still carry significant weight with the courts since it is the agency charged by Congress with the task of initially determining whether a work is entitled to copyright protection and, hence, may be registered for copyright.
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By Robert Gerber and Michael Murphy

Recent cases reveal that seeking a reasonable royalty as a copyright remedy can be an uncertain endeavor. Courts have differed regarding which evidentiary factors are relevant and necessary. Parties seeking to apply the reasonable royalty analysis frequently used in the patent litigation arena have sometimes found themselves successful, and other times frustrated.
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Social media has become a part of everyday life. As Shakespeare has written: "This news is not old enough, yet it is every day news." The minutiae of every moment is narrated through status updates. Digital photographs are taken and instantaneously posted minute-by-minute on the Internet for the world to see. This lightning fast use of social media raises new and different intellectual property challenges which have not been previously addressed by courts. On January 14, 2011, the Southern District of New York addressed a particularly interesting copyright question raised by the use of Twitpic – a service that allows users to post pictures to the Twitter microblogging and social networking website. Agence France Presse v. Morel, 2011 WL 147718 (S.D.N.Y. Jan. 14, 2011).   

In Neal Stephenson’s 1992 science fiction novel, Snow Crash, humans interact as avatars in the “Metaverse,” the collective product of online shared three-dimensional space.[1] As imagined by Stephenson, this “Metaverse” has been created by all virtual worlds[2] - it is an augmented and enhanced physical reality, a physically persistent virtual space.[3] The novel is set in Los Angeles during the early 21st Century. The federal government of the United States has relinquished its authority to private entrepreneurs and organizations. Franchising, individual sovereignty, and private automobiles reign supreme. Highway companies compete for traffic in the real world while the Metaverse is populated and travelled by user-controlled avatars and system daemons.

The State Copyright Bureau recently released a new set of copyright pledges registration rules to replace its current system. The "Measures for Registration of Copyright Pledges" (the "Measures") will become effective on January 1, 2011. Copyrights, like other property rights, can be pledged as a financial security. China has not updated its current copyright pledges registration system since it went into effect on September 23, 1996. The key provisions of the Measures are highlighted below.

The expression "bad facts make bad law" comes to mind when reading the news reports about Righthaven LLC and the Las Vegas Review-Journal ("Las Vegas Review"). Namely, the Las Vegas Review has partnered with Righthaven to sell their copyright interest in articles after the articles in whole or part are attached as hyperlinks to blogs. Righthaven registers the copyrights it purportedly acquires from the Las Vegas Review and then sues the blogs without sending the standard "cease and desist" letter beforehand.

On August 6, 2010 Senator Charles Schumer (D-NY), introduced a bill entitled the Innovative Design Protection and Piracy Prevention Act ("IDPPPA") (S. 3728), which represents a compromise between the American Apparel & Footwear Association ("AAFA") and the Council of Fashion Designers of America ("CFDA") in an effort to afford protection to American designers for new and original fashion designs.[1]

A change in the rules on copyright licensing may be coming in the near future and from an unexpected and unanticipated source. The rules deal with whether the owner of an exclusive copyright license may sublicense such right without the approval of the licensor. The clear and unequivocal answer in the Ninth Circuit has long been, "No." See, Gardner v. Nike, Inc., 279 F.3d 774 (9th Cir. 2002). The answer in other circuits is somewhat less clear. Most licensors, however, have long sought contractual clarity by providing for "assignment" or "license" provisions in any contract for copyrights, trademarks or patents. Congress, however, may soon be changing the Ninth Circuit's answer at a time when few may even be aware of the pending change.

On April 19th, 2010, the United States Supreme Court granted certiorari to consider whether, in the context of a copyright infringement claim, the first sale doctrine applies to imported goods manufactured abroad. The first sale doctrine, codifed at 17 U.S.C. § 109(a), works as a defense to a copyright infringement claim where the copyright owner consents to the first sale of its copyrighted work.

The Ninth Circuit recently stayed an injunction entered against MGA Entertainment, Inc., that would have otherwise required MGA to ensure that none of its popular Bratz dolls, the subject of a copyright dispute with toy giant, Mattel, Inc., are available on store shelves as of January 21, 2010. The injunction's requirement that MGA also turn over its portfolio of Bratz related trademarks to Mattel was stayed as well. Mattel obtained an injunction against MGA after a jury found that a former Mattel employee, Carter Bryant, came up with the Bratz doll idea while under Mattel's employ, that Mattel owned the copyrights in the Bratz doll designs, and that MGA, who hired Carter Bryant after he left Mattel, infringed Mattel's copyrights.

On June 17, 2009, Judge Laura Taylor Swain of the Southern District of New York dismissed the copyright claims of jeans maker Do Denim against rival manufacturer Fried Denim Inc., holding that the mere filing of the copyright applications, fees and deposits did not satisfy the jurisdictional requirement that a copyright be registered before a lawsuit is initiated. Do Denim v. Fried Denim, No. 08Civ.10947, 2009 U.S. Dist. LEXIS 51512, at *7 (S.D.N.Y. June 17, 2009). This decision highlights the importance of copyright registration, as a jurisdictional prerequisite for plaintiffs hoping to protect their designs.

On April 3, 2009, the District Court for Colorado entered a groundbreaking copyright decision, treading on new judicial territory by directly applying the First Amendment to invalidate a provision of the Copyright Act. The case, Golan v. Ashcroft, Civil Case No. 01-cv-01854-LTB, found that, at least as applied to the plaintiffs, the copyright restoration provisions found in Section 104A of the Copyright Act violated rights to material permanently in the public domain by restoring full copyright protection as of January 1, 1996, to such material.

The pressure to cut production costs for media works is larger than ever. One expense that should not be slashed, however, is the expense of registering a copyright in the work soon after it is created — whether that work is a written script, motion picture, a television episode, a commercial or a song. Considering that the standard Copyright Office filing fee for registration is between $35 (if filing electronically) and $45 (if filing the old fashion way on paper, which many still do), registration arguably provides a substantial dollar- to-dollar return on investment.

Hot News! ... for IP lawyers. Hot news is still good law. After 90 years, a dusty 1918 Supreme Court case (International News Service v. Associated Press, 248 U.S. 215 (1918)), often overlooked and generally ignored, was resurrected from the judicial cobwebs by Judge Castel. The case before Judge Castel involved the same news gathering icon and was styled Associated Press v. All Headline News Corp. (decided on February 17, 2009, United States District Court for the Southern District of New York, 08 Civ. 323(PKC)). As an added attraction, Judge Castel also weighed in on an increasingly diverse debate over what constitutes protected "Copyright Management Information," or "CMI," under the Digital Millennium Copyright Act (DMCA).

In a recent case, UMG Recordings, Inc. v. Veoh Networks, Inc., 89 U.S.P.Q.2d 1449 (C.D. Cal. 2008), the Central District decided a question of first impression—whether certain activities of a website operator fit within the section 512(c) safe harbor of the Digital Millennium Copyright Act ("DMCA") (found at 17 U.S.C. § 512).

In December 2004, Google announced its plan to digitally scan the entire contents of four university libraries and one public library, with the ultimate goal of enabling Internet users to search that content online.  In exchange for permission to digitize the works in the libraries and make "brief excerpts" of the works available on its site, Google promised to give the libraries a digital copy of the contents.  Although Google had already reached an arrangement with major universities (Michigan, Harvard, Stanford, and Oxford) as well as the New York Public Library, many authors and publishers quickly concluded that their copyright interests were not being protected.  Lawsuits were filed in the Southern District of New York in the fall of 2005, arguing that Google's attempts to scan and index wholesale works infringed on copyright protections.  See The Authors Guild, Inc., et al. v. Google Inc., No. 05 CV 8136 (S.D.N.Y. filed Sept. 20, 2005); The McGraw-Hill Cos., Inc., et al. v. Google Inc., No. 05 CV 8881 (S.D.N.Y. filed Oct. 19, 2005).  Negotiations to resolve the dispute began in 2006, and, two years later, a framework has emerged that both sides agree will protect the interests of authors and publishers and give Google the right to digitize millions of works.

The Ninth Circuit recently handed manufacturers a gift.  In a decision which, at first blush, might seem at odds with well-established Supreme Court jurisprudence, manufacturers are now able to use copyright law to keep their products from being imported to the United States, if lawfully manufactured and first sold abroad.
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Open source licensing of software got a recent boost from an unlikely source, the Court of Appeals for the Federal Circuit.  The CAFC normally decides patent and trademark issues but rarely deals with copyrights.  In an appeal from the Northern District of California, the CAFC reversed and remanded for further factual findings after holding, as a matter of law, that provisions in an open source license of certain software, which allows model railroaders to program decoder chips that control model railroads, were conditions, not covenants.  Jacobsen v. Katzer, 535 F.3d 1373 (Fed. Cir. 2008).  Accordingly, failure to comply with the "conditions" resulted in actions outside the scope of the license which were, in turn, an infringement of the software copyright.  The trial court had held the software terms were covenants so that a breach could only be enforced by a money judgment.  Since open source, or "public" licenses, are by their nature free of charge, such a breach failed to yield any recognizable damages.  Finding no copyright infringement, the trial court thus denied the plaintiff's motion for a preliminary injunction.

Two recent decisions from the Northern District of California break new ground in the interpretation of the Digital Millennium Copyright Act (DMCA).  These cases may indicate how a couple of the most contentious issues about the use of copyrighted works in user-generated content on the Internet will be resolved.

In a decision that could have far-reaching implications for technology licenses of all types, the U.S. District Court for the Central District of California recently held that the first sale doctrine permits a recipient of promotional CDs to sell them online without violating the license pursuant to which the CDs were distributed and without being liable for copyright infringement.  UMG Recordings, Inc. v. Augusto, No. CV 07-03106, slip op. (C.D. Cal. June 10, 2008).  The court granted the defendant's motion for summary judgment and rejected Universal Music Group’s (“UMG”) argument that the labeling on the promotional CDs created a license without transferring title.

A recent en banc ruling of the 11th Circuit helps to clarify and solidify a media-neutral trend in copyright law while adding certainty to what publishers may do with valuable libraries of outdated paper. Such outdated paper will have little utility unless made available for republication in more accessible new media.

Since the Supreme Court's decision in eBay v. Merc-Exchange, IP plaintiffs who plan on relying on the presumption of irreparable harm when seeking injunctive relief (whether a TRO, preliminary or permanent) may want to rethink that strategy.  The days of relying on a general "presumption" of irreparable harm, without actual proof of such harm, are essentially over—at least for cases that fall squarely within the eBay decision (i.e., patent infringement cases where injunctions are sought).  Less clear is eBay's holding to other traditional areas of intellectual property, like trademark and copyright infringement cases.  Nevertheless, the vigilant IP owner should be prepared to prove irreparable harm by way of compelling evidence.  Even if the court ultimately applies the presumption of irreparable harm, the effort will certainly pay off and may preclude attacks on appeal.

The Register of Copyrights has issued a formal opinion finding that, in most instances, musical ringtones for cell phones and related mobile devices fall within the scope of the statutory license under Section 115 of the Copyright Act.  See Docket No. RF 2006-1.  The Register rendered its opinion at the request of the Record Industry Association of America (“RIAA”), which had sought clarification that musical ringtones, typically comprising of ten-to-thirty-second “snippets” of full-length musical works, are subject to Section 115 of the Copyright Act and, thus, may properly be made and distributed under the compulsory license afforded by that Section.  Analyzing the language of Section 115 as well as the legislative history related to changes to that Section with the enactment of the Digital Performance Right in Sound Recordings Act of 1995, the Register concluded that “ringtones that are merely excerpts of a preexisting sound recording fall squarely within the scope of the statutory license.”

The Copyright Office recently issued a press release in their "Newsnet," Issue 341, April 14, 2008, announcing what everyone else already knew. The Copyright Office is getting seriously behind in processing copyright applications and issuing registration certificates. In fact, the official time lag for receiving a certificate is now "up to 8 months." This is not an inconsiderable pendency since as recently as a year ago certificates were being issued within 4 to 6 months. The problem of pendency becomes even worse in relationship to when the information actually appears on the public records which may be some time after the registration issues. This means that the public which is bound by the legal effects of the copyright registration as of the original filing date, may not even be aware that an application has been filed, or have any way of easily investigating online, for up to a year after such filing date which is, legally speaking, also the "effective date of a copyright registration" under Section 410(d) of the Copyright Act.

Like New Year's resolutions which remain unfulfilled, a decision late last year of a federal district court sent still another reminder that copyright law in the United States remains far from the formality free regime envisioned by Berne Convention rules.  In November, Goss International Americas, Inc. v. A-American Machine & Assembly Co., 2007 WL 4294744 (N.D. Ill., Nov. 30, 2007) once again drove home the reality that registration is one formality that still rules.

Click here to view a PDF copy of the document.

In a time long long ago, fans of certain fictional worlds portrayed in games or on television were relegated to relative obscurity. User generated content was generally confined to a well-crafted Klingon warrior outfit, the occasional love sonnet written in elvish, or a meticulously crafted sculpture of a twenty-sided die; however, the internet and the relative affordability of production software, including sophisticated movie editing platforms, has given these fans the ability to burst from their shadowy meeting places and into the World Wide Web's limelight.

In a case likely to impact intellectual property litigation, the Supreme Court recently issued a ruling that alters the pleading standard necessary to support civil complaints filed in federal court, which governs most IP disputes.  In Bell Atlantic Corp. v. Twombly, 550 U.S. ____ (2007), the Court heightened the pleading standard, requiring that a complaint recite facts sufficient to "plausibly" support the legal claims it sets forth.

Summary

On May 16, 2007, the Ninth Circuit ruled in two very closely-watched cases, Perfect 10, Inc. v. Google Inc. and Perfect 10, Inc. v. Amazon.com, Inc., that involved the potential liability of search engine companies for (1) providing copyrighted images to users, and (2) linking to third-party websites where infringing images might be found.  The Ninth Circuit vacated a preliminary injunction barring Google from displaying thumbnail copies of Perfect 10's nude models in Google search results.

With 4th Circuit decision, new uncertainty about injunctions extends to copyright cases.

It can be a fatal mistake to overlook remedies and their required elements of proof. Most lawyers feel comfortable giving opinions on liability (in their own fields of expertise, of course) and often assume that the usual remedies will simply fall into place. Nowhere could such an assumption prove more embarrassing, if not worse, than on the shifting sands of permanent injunctions in copyright cases. Once thought to routinely follow liability, such “automatic” injunctions may be history.

Summary

On May 16, 2007, the Ninth Circuit ruled in two very closely-watched cases, Perfect 10, Inc. v. Google Inc. and Perfect 10, Inc. v. Amazon.com, Inc., that involved the potential liability of search engine companies for (1) providing copyrighted images to users, and (2) linking to third-party websites where infringing images might be found.  The Ninth Circuit vacated a preliminary injunction barring Google from displaying thumbnail copies of Perfect 10's nude models in Google search results.

On May 15, 2007, in a divided decision, the United States Court of Appeals for the Ninth Circuit adopted a new and significantly narrower interpretation of the immunity from liability for online service providers provided by the Communications Decency Act.  In Fair Housing Council of San Fernando Valley, et al. v. Roommates.com, LLC, Appeal Nos. 04-56916 and 04-57173, (click here) Ninth Circuit holds that service providers may be liable for content originating from users if they solicit the unlawful information, or categorize, channel, and limit the distribution of the information.

There is a groundswell of federal legislative activity aimed at protecting and enforcing the intellectual property rights of United States businesses, authors and artists against international counterfeiting and piracy. This movement is signified most recently by the introduction of Senate Bill 522 on Feb. 7, entitled the "Intellectual Property Rights Enforcement Act." What remains to be seen is whether this groundswell will come out of the halls of Congress and into the international marketplace, or whether it will recede into relative oblivion, as when a prior version of IPREA was introduced in 2005.  

ASCAP, a performance rights organization, initiated a royalty rate proceeding in the fall of 2005, asking a federal court to set royalty rates for "performances" of digital music by AOL, Yahoo! and RealNetworks.

Many transactional lawyers who represent clients in entertainment, media or publishing deals have some working knowledge of copyright law.  However, as they say, "a little knowledge can be a dangerous thing."  Copyright law is full of exceptions and qualifiers, and many clients and lawyers have only broad understandings of the way copyright law works to protect the original expression of ideas.  Copyright litigators see many deals go sideways because of client or attorney misunderstandings about copyright law.  Here is our "top ten" list.

From its November 2005 launch date to its $1.65 billion dollar acquisition by Google less than one-year later, YouTube.com has experienced the kind of meteoric rise in popularity some would say only possible through the enormous commercial potential of the internet.

On September 6, 2006, the District Court in Frankfurt-on-the-Main issued a judgment which upheld the validity of the GNU General Public License (GPL), version 2.   The case involved a complaint by Harald Welte, a co-developer of the netfilter firewall code in the Linux kernel and founder of the gpl-violations.org project, against D-Link Germany GmbH, a German subsidiary of Taiwanese hardware manufacturer D-Link Corporation.

The United States Copyright Act provides authors and certain named statutory successors a one-time right to unilaterally terminate grants and transfers of renewal copyrights within a narrowly specified window. The right has been called "inalienable" by the U.S. Supreme Court, and the Copyright Act expressly states that the right may be exercised notwithstanding "any agreement to the contrary." Despite the implications that this right may have on long standing agreements between authors or their heirs and grantees such as book publishers, very few courts have had the occasion to explore the right and the meaning of the Act's "any agreement to the contrary" language.

1. Defendant was ordered to pay $15,000,000
2. Defendant was permanently enjoined from violating Section 17(b) of the Securities Exchange Act of 1934 (requiring a prompt document production, including electronic documents); and
3. For one year, Defendant, at its own cost, was ordered to hire an independent consultant (acceptable to the SEC) to review and evaluate defendant's policies, procedures, and training in order to comply with the judgment. The independent consultant is to make recommendations which must, absent undue burden or impracticality, be adopted by Defendant.

Freedom Tower, the much publicized reconstruction project at the World Trade Center in New York, has seen a lot of ups and downs since it was unveiled to the public in 2003.  It has survived a heated contest among several prestigious architectural firms, allegations of political corruption on the part of the NY governor in allegedly influencing the outcome of the contest, public criticism as to the proper use of the site as a fitting memorial, and security concerns over the building layout.  But even as the first bricks of the foundation are laid for the new building, the original Freedom Tower design is battling yet another dispute- this one in the courts.

Thanks to Napster, iPods, DVD burners, and TiVo, stories infused with the law of copyright have peppered the news over the last five years. Necessarily overlooking many of the complexities and nuances of copyright law, this brief primer may help you better comprehend those articles in your morning newspaper.

Click here to view PDF of entire article

In a battle between the producers of reality television shows "Wife Swap" and "Trading Spouses," a California federal court held that trade dress cannot be invoked to provide perpetual protection for what are essentially copyright claims. As a result, the court dismissed plaintiff's claim that defendants have imitated the "total image and appearance," or trade dress, of the "Wife Swap" show.

The Court acknowledged that the same elements of a work may be protected as both copyrightable expression and trade dress. However, it held that such a finding in this case would lead to the misguided conclusion that "every incidence of visual expression would be subject to copyright and trademark protection and that protection would last in perpetuity." 372 F.Supp.2d at 564.

[This case is cited as: RDF Media Ltd. v. Fox Broad. Co., 372 F. Supp. 2d 556 (C.D. Cal. 2005).]

Did you know that before 1891 the U.S. was a copyright piracy haven? Up until that time foreign trademark owners had no enforcement rights in the U.S. This left U.S. copiers free to duplicate and distribute such popular current works as Tolstoy, Dickens, and Hugo without repercussion.

Eventually foreign pressure persuaded the U.S. to get in line with international copyright law. The moral of the story? Those concerned about non-convention foreign infringers should take heart - the piracy party will not last forever. History is bound to repeat itself.