USI MidAtlantic, Inc. suffered a $22.5 million judgment for copyright infringement from competitor. A former employee of the competitor joined MidAtlantic and supplied them with binders of information about insurance products created by his former employer. Most lawyers would look to confidentiality agreements and trade secrets, but Graham, the competitor, had done something even better: they copyrighted the material. When MidAtlantic copied language from the binders into over 800 client proposals, they were found to indirectly infringe the copyrights.Graham recovered profits attributable to USI MidAtlantic's infringement, plus prejudgment interest.
The lesson? Copyright can be used to protect business work product. The plaintiff proved lost profits: their task may have been easier if they had promptly registered their copyrights.
The big legal issue in the case how far back can copyright damages go? Three years is the statute of limitations. The issue is, though, whether the statute of limitation runs three years from discovery or from when the claim "accrued," e.g. "occurred." Under the injury rule, a claim accrues, and the statute of limitations begins to run, when the plaintiff suffers the injury. If the discovery rule applies, the claim arises when the plaintiff discovers, or with reasonable diligence should have discovered, the injury. The difference: in this case the shorter limit resulted in $2 million in damages, the longer $20 million.
The Third Circuit went with the Discovery Rule. "Although we have not previously addressed this issue, eight of our sister courts of appeals have applied the discovery rule to civil actions under the Copyright Act. See Warren Freedenfeld Assocs., Inc. v. McTigue, 531 F.3d 38, 44-46 (1st Cir.2008); Comcast v. Multi-Vision Elecs., Inc., 491 F.3d 938, 944 (8th Cir.2007); Roger Miller Music, Inc. v. Sony/ATV Publ'g, LLC, 477 F.3d 383, 390 (6th Cir.2007); Polar Bear Prods., Inc. v. Timex Corp., 384 F.3d 700, 705-07 (9th Cir.2004); Gaiman v. McFarlane, 360 F.3d 644, 653 (7th Cir.2004); Lyons P'ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 796 (4th Cir.2001); Daboub v. Gibbons, 42 F.3d 285, 291 (5th Cir.1995); Stone v. Williams, 970 F.2d 1043, 1048 (2d Cir.1992)."
Defense, it seems, often relies on some shred of hope in some case somewhere. On this issue, it is a New York District Court case that gives copyright defendants hope to limit the limitations to accrual. Auscape Int'l v. Nat'l Geographic Soc'y, 409 F.Supp.2d 235, 247 (S.D.N.Y.2004). And defendants want to broaden a Supreme Court case on FCRA statute of limitations to copyright. TRW Inc. v. Andrews, 534 U.S. 19, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001). That dog, it seems, won't hunt.
Here is the Third Circuit case: WILLIAM GRAHAM COMPANY v. HAUGHEY USI
Showing posts with label copyright. Show all posts
Showing posts with label copyright. Show all posts
Thursday, August 4, 2011
Protect Your Business Work Product: Copyright
USI MidAtlantic, Inc. suffered a $22.5 million judgment for copyright infringement from competitor. A former employee of the competitor joined MidAtlantic and supplied them with binders of information about insurance products created by his former employer. Most lawyers would look to confidentiality agreements and trade secrets, but Graham, the competitor, had done something even better: they copyrighted the material. When MidAtlantic copied language from the binders into over 800 client proposals, they were found to indirectly infringe the copyrights.Graham recovered profits attributable to USI MidAtlantic's infringement, plus prejudgment interest.
The lesson? Copyright can be used to protect business work product. The plaintiff proved lost profits: their task may have been easier if they had promptly registered their copyrights.
The big legal issue in the case how far back can copyright damages go? Three years is the statute of limitations. The issue is, though, whether the statute of limitation runs three years from discovery or from when the claim "accrued," e.g. "occurred." Under the injury rule, a claim accrues, and the statute of limitations begins to run, when the plaintiff suffers the injury. If the discovery rule applies, the claim arises when the plaintiff discovers, or with reasonable diligence should have discovered, the injury. The difference: in this case the shorter limit resulted in $2 million in damages, the longer $20 million.
The Third Circuit went with the Discovery Rule. "Although we have not previously addressed this issue, eight of our sister courts of appeals have applied the discovery rule to civil actions under the Copyright Act. See Warren Freedenfeld Assocs., Inc. v. McTigue, 531 F.3d 38, 44-46 (1st Cir.2008); Comcast v. Multi-Vision Elecs., Inc., 491 F.3d 938, 944 (8th Cir.2007); Roger Miller Music, Inc. v. Sony/ATV Publ'g, LLC, 477 F.3d 383, 390 (6th Cir.2007); Polar Bear Prods., Inc. v. Timex Corp., 384 F.3d 700, 705-07 (9th Cir.2004); Gaiman v. McFarlane, 360 F.3d 644, 653 (7th Cir.2004); Lyons P'ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 796 (4th Cir.2001); Daboub v. Gibbons, 42 F.3d 285, 291 (5th Cir.1995); Stone v. Williams, 970 F.2d 1043, 1048 (2d Cir.1992)."
Defense, it seems, often relies on some shred of hope in some case somewhere. On this issue, it is a New York District Court case that gives copyright defendants hope to limit the limitations to accrual. Auscape Int'l v. Nat'l Geographic Soc'y, 409 F.Supp.2d 235, 247 (S.D.N.Y.2004). And defendants want to broaden a Supreme Court case on FCRA statute of limitations to copyright. TRW Inc. v. Andrews, 534 U.S. 19, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001). That dog, it seems, won't hunt.
Here is the Third Circuit case: WILLIAM GRAHAM COMPANY v. HAUGHEY USI
The lesson? Copyright can be used to protect business work product. The plaintiff proved lost profits: their task may have been easier if they had promptly registered their copyrights.
The big legal issue in the case how far back can copyright damages go? Three years is the statute of limitations. The issue is, though, whether the statute of limitation runs three years from discovery or from when the claim "accrued," e.g. "occurred." Under the injury rule, a claim accrues, and the statute of limitations begins to run, when the plaintiff suffers the injury. If the discovery rule applies, the claim arises when the plaintiff discovers, or with reasonable diligence should have discovered, the injury. The difference: in this case the shorter limit resulted in $2 million in damages, the longer $20 million.
The Third Circuit went with the Discovery Rule. "Although we have not previously addressed this issue, eight of our sister courts of appeals have applied the discovery rule to civil actions under the Copyright Act. See Warren Freedenfeld Assocs., Inc. v. McTigue, 531 F.3d 38, 44-46 (1st Cir.2008); Comcast v. Multi-Vision Elecs., Inc., 491 F.3d 938, 944 (8th Cir.2007); Roger Miller Music, Inc. v. Sony/ATV Publ'g, LLC, 477 F.3d 383, 390 (6th Cir.2007); Polar Bear Prods., Inc. v. Timex Corp., 384 F.3d 700, 705-07 (9th Cir.2004); Gaiman v. McFarlane, 360 F.3d 644, 653 (7th Cir.2004); Lyons P'ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 796 (4th Cir.2001); Daboub v. Gibbons, 42 F.3d 285, 291 (5th Cir.1995); Stone v. Williams, 970 F.2d 1043, 1048 (2d Cir.1992)."
Defense, it seems, often relies on some shred of hope in some case somewhere. On this issue, it is a New York District Court case that gives copyright defendants hope to limit the limitations to accrual. Auscape Int'l v. Nat'l Geographic Soc'y, 409 F.Supp.2d 235, 247 (S.D.N.Y.2004). And defendants want to broaden a Supreme Court case on FCRA statute of limitations to copyright. TRW Inc. v. Andrews, 534 U.S. 19, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001). That dog, it seems, won't hunt.
Here is the Third Circuit case: WILLIAM GRAHAM COMPANY v. HAUGHEY USI
Monday, February 7, 2011
CD's? CD's still exist? The law tries to catch up . . .
The trouble with technology and the law is that technology moves fast; the law does not.
So, finally a ruling on whether promotional music compact discs can be resold without violating copyright. The answer? Yes, because of the first-sale doctrine. UMG Recordings, Inc. v. Augusto, Case No. 08-55998 (9th Cir., Jan. 4, 2011) (Canby, J.).
UMG Records distributed promotional CDs. They sent them to critics, radio personnel, and others for promotion. Of course, they claimed the cd was only for those to whom they sent them: acceptance of the cd is a license; not for resale; promotional use only; resale or transfer is not allowed and may be punishable under federal and state laws. Very imposing.
I had always wondered, since way back in the day, when a local general manager of a Fort Wayne tv/radio empire gave me a new Iggy Pop album sent to them for promotion, whether I had been the unwitting recipient of a copyright violation or some kind of crime. Cal wasn't worried; but, I never wanted to risk my neck for Iggy Pop.
The question is answered. Despite the warning of the Dire Wolf on the recordings sent, unsolicited and for free, we need not beg "don't murder me record company, please don't murder me," although Mr Augusto was dragged to the Ninth Circuit. His sin? Ebay.
The district court granted Augusto summary judgment finding his sale on Ebay of Big Bad Record Company's promotional cd's permissible under the first-sale doctrine. Lawfully acquiring title of a copyrighted work gives one the permission to transfer, sell, or dispose of that work without permission from the copyright owner. That's the first sale doctrine (which says the second sale is not a copyright violation).
The Supreme Court created the first sale doctrine, which is very simple. Once you buy a car, you can resell it at any price. Why should copyright differ? In Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908), the Supreme Court said it should not. Describing its own case, the Supreme Court explained: "In that case, the publisher, Bobbs-Merrill, had inserted a notice in its books that any retail sale at a price under $1.00 would constitute an infringement of its copyright. The defendants, who owned Macy’s department store, disregarded the notice and sold the books at a lower price without Bobbs-Merrill’s consent. We held that the exclusive statutory right to vend applied only to the first sale of the copyrighted work..."
The Big Bad Record Company said its distribution of promotional CDs constituted a license and not a “sale,” pointing to its promotional statements on the CDs. But, the first-sale doctrine applies not only to a sale, but also to any transfer after the copyrighted work being placed in the stream of commerce. And, as any contract law 101 would teach, the free, unsolicited distribution did not create a license. And the commentators had explained that "first sale" really means "first transfer:" Although this statutory limitation is commonly referred to as the first sale doctrine, its protection does not require a "sale." The doctrine applies after the "first authorized disposition by which title passes." 2 Nimmer § 8.12[B][1][a]. This passing of title may occur through a transfer by gift. See 4 William F. Patry, Patry on Copyright § 13:15 ("Since the principle [of the first sale doctrine] applies when copies are given away or are otherwise permanently transferred without the accoutrements of a sale, 'exhaustion' is the better description."); 2 Paul Goldstein, Goldstein on Copyright § 7.6.1 n.4 (3d ed.) ("[A] gift of copies or phonorecords will qualify as a 'first sale' to the same extent as an actual sale for consideration.").
Best of all, there is a Unordered Merchandise Statute. Because the discs were unordered merchandise, the recipients were free to “retain, use, discard, or dispose” of them as they saw fit under the Unordered Merchandise Statute." That statute does, indeed, make unordered merchandise a gift. Kudos to the defense lawyers for this research.
The 9th Circuit dismissed the infringement claim. I am safe for receiving Iggy Pop. And future lawyers will try to understand what was a cd . . .
So, finally a ruling on whether promotional music compact discs can be resold without violating copyright. The answer? Yes, because of the first-sale doctrine. UMG Recordings, Inc. v. Augusto, Case No. 08-55998 (9th Cir., Jan. 4, 2011) (Canby, J.).
UMG Records distributed promotional CDs. They sent them to critics, radio personnel, and others for promotion. Of course, they claimed the cd was only for those to whom they sent them: acceptance of the cd is a license; not for resale; promotional use only; resale or transfer is not allowed and may be punishable under federal and state laws. Very imposing.
I had always wondered, since way back in the day, when a local general manager of a Fort Wayne tv/radio empire gave me a new Iggy Pop album sent to them for promotion, whether I had been the unwitting recipient of a copyright violation or some kind of crime. Cal wasn't worried; but, I never wanted to risk my neck for Iggy Pop.
The question is answered. Despite the warning of the Dire Wolf on the recordings sent, unsolicited and for free, we need not beg "don't murder me record company, please don't murder me," although Mr Augusto was dragged to the Ninth Circuit. His sin? Ebay.
The district court granted Augusto summary judgment finding his sale on Ebay of Big Bad Record Company's promotional cd's permissible under the first-sale doctrine. Lawfully acquiring title of a copyrighted work gives one the permission to transfer, sell, or dispose of that work without permission from the copyright owner. That's the first sale doctrine (which says the second sale is not a copyright violation).
The Supreme Court created the first sale doctrine, which is very simple. Once you buy a car, you can resell it at any price. Why should copyright differ? In Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908), the Supreme Court said it should not. Describing its own case, the Supreme Court explained: "In that case, the publisher, Bobbs-Merrill, had inserted a notice in its books that any retail sale at a price under $1.00 would constitute an infringement of its copyright. The defendants, who owned Macy’s department store, disregarded the notice and sold the books at a lower price without Bobbs-Merrill’s consent. We held that the exclusive statutory right to vend applied only to the first sale of the copyrighted work..."
The Big Bad Record Company said its distribution of promotional CDs constituted a license and not a “sale,” pointing to its promotional statements on the CDs. But, the first-sale doctrine applies not only to a sale, but also to any transfer after the copyrighted work being placed in the stream of commerce. And, as any contract law 101 would teach, the free, unsolicited distribution did not create a license. And the commentators had explained that "first sale" really means "first transfer:" Although this statutory limitation is commonly referred to as the first sale doctrine, its protection does not require a "sale." The doctrine applies after the "first authorized disposition by which title passes." 2 Nimmer § 8.12[B][1][a]. This passing of title may occur through a transfer by gift. See 4 William F. Patry, Patry on Copyright § 13:15 ("Since the principle [of the first sale doctrine] applies when copies are given away or are otherwise permanently transferred without the accoutrements of a sale, 'exhaustion' is the better description."); 2 Paul Goldstein, Goldstein on Copyright § 7.6.1 n.4 (3d ed.) ("[A] gift of copies or phonorecords will qualify as a 'first sale' to the same extent as an actual sale for consideration.").
Best of all, there is a Unordered Merchandise Statute. Because the discs were unordered merchandise, the recipients were free to “retain, use, discard, or dispose” of them as they saw fit under the Unordered Merchandise Statute." That statute does, indeed, make unordered merchandise a gift. Kudos to the defense lawyers for this research.
The 9th Circuit dismissed the infringement claim. I am safe for receiving Iggy Pop. And future lawyers will try to understand what was a cd . . .
CD's? CD's still exist? The law tries to catch up . . .
The trouble with technology and the law is that technology moves fast; the law does not.
So, finally a ruling on whether promotional music compact discs can be resold without violating copyright. The answer? Yes, because of the first-sale doctrine. UMG Recordings, Inc. v. Augusto, Case No. 08-55998 (9th Cir., Jan. 4, 2011) (Canby, J.).
UMG Records distributed promotional CDs. They sent them to critics, radio personnel, and others for promotion. Of course, they claimed the cd was only for those to whom they sent them: acceptance of the cd is a license; not for resale; promotional use only; resale or transfer is not allowed and may be punishable under federal and state laws. Very imposing.
I had always wondered, since way back in the day, when a local general manager of a Fort Wayne tv/radio empire gave me a new Iggy Pop album sent to them for promotion, whether I had been the unwitting recipient of a copyright violation or some kind of crime. Cal wasn't worried; but, I never wanted to risk my neck for Iggy Pop.
The question is answered. Despite the warning of the Dire Wolf on the recordings sent, unsolicited and for free, we need not beg "don't murder me record company, please don't murder me," although Mr Augusto was dragged to the Ninth Circuit. His sin? Ebay.
The district court granted Augusto summary judgment finding his sale on Ebay of Big Bad Record Company's promotional cd's permissible under the first-sale doctrine. Lawfully acquiring title of a copyrighted work gives one the permission to transfer, sell, or dispose of that work without permission from the copyright owner. That's the first sale doctrine (which says the second sale is not a copyright violation).
The Supreme Court created the first sale doctrine, which is very simple. Once you buy a car, you can resell it at any price. Why should copyright differ? In Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908), the Supreme Court said it should not. Describing its own case, the Supreme Court explained: "In that case, the publisher, Bobbs-Merrill, had inserted a notice in its books that any retail sale at a price under $1.00 would constitute an infringement of its copyright. The defendants, who owned Macy’s department store, disregarded the notice and sold the books at a lower price without Bobbs-Merrill’s consent. We held that the exclusive statutory right to vend applied only to the first sale of the copyrighted work..."
The Big Bad Record Company said its distribution of promotional CDs constituted a license and not a “sale,” pointing to its promotional statements on the CDs. But, the first-sale doctrine applies not only to a sale, but also to any transfer after the copyrighted work being placed in the stream of commerce. And, as any contract law 101 would teach, the free, unsolicited distribution did not create a license. And the commentators had explained that "first sale" really means "first transfer:" Although this statutory limitation is commonly referred to as the first sale doctrine, its protection does not require a "sale." The doctrine applies after the "first authorized disposition by which title passes." 2 Nimmer § 8.12[B][1][a]. This passing of title may occur through a transfer by gift. See 4 William F. Patry, Patry on Copyright § 13:15 ("Since the principle [of the first sale doctrine] applies when copies are given away or are otherwise permanently transferred without the accoutrements of a sale, 'exhaustion' is the better description."); 2 Paul Goldstein, Goldstein on Copyright § 7.6.1 n.4 (3d ed.) ("[A] gift of copies or phonorecords will qualify as a 'first sale' to the same extent as an actual sale for consideration.").
Best of all, there is a Unordered Merchandise Statute. Because the discs were unordered merchandise, the recipients were free to “retain, use, discard, or dispose” of them as they saw fit under the Unordered Merchandise Statute." That statute does, indeed, make unordered merchandise a gift. Kudos to the defense lawyers for this research.
The 9th Circuit dismissed the infringement claim. I am safe for receiving Iggy Pop. And future lawyers will try to understand what was a cd . . .
So, finally a ruling on whether promotional music compact discs can be resold without violating copyright. The answer? Yes, because of the first-sale doctrine. UMG Recordings, Inc. v. Augusto, Case No. 08-55998 (9th Cir., Jan. 4, 2011) (Canby, J.).
UMG Records distributed promotional CDs. They sent them to critics, radio personnel, and others for promotion. Of course, they claimed the cd was only for those to whom they sent them: acceptance of the cd is a license; not for resale; promotional use only; resale or transfer is not allowed and may be punishable under federal and state laws. Very imposing.
I had always wondered, since way back in the day, when a local general manager of a Fort Wayne tv/radio empire gave me a new Iggy Pop album sent to them for promotion, whether I had been the unwitting recipient of a copyright violation or some kind of crime. Cal wasn't worried; but, I never wanted to risk my neck for Iggy Pop.
The question is answered. Despite the warning of the Dire Wolf on the recordings sent, unsolicited and for free, we need not beg "don't murder me record company, please don't murder me," although Mr Augusto was dragged to the Ninth Circuit. His sin? Ebay.
The district court granted Augusto summary judgment finding his sale on Ebay of Big Bad Record Company's promotional cd's permissible under the first-sale doctrine. Lawfully acquiring title of a copyrighted work gives one the permission to transfer, sell, or dispose of that work without permission from the copyright owner. That's the first sale doctrine (which says the second sale is not a copyright violation).
The Supreme Court created the first sale doctrine, which is very simple. Once you buy a car, you can resell it at any price. Why should copyright differ? In Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908), the Supreme Court said it should not. Describing its own case, the Supreme Court explained: "In that case, the publisher, Bobbs-Merrill, had inserted a notice in its books that any retail sale at a price under $1.00 would constitute an infringement of its copyright. The defendants, who owned Macy’s department store, disregarded the notice and sold the books at a lower price without Bobbs-Merrill’s consent. We held that the exclusive statutory right to vend applied only to the first sale of the copyrighted work..."
The Big Bad Record Company said its distribution of promotional CDs constituted a license and not a “sale,” pointing to its promotional statements on the CDs. But, the first-sale doctrine applies not only to a sale, but also to any transfer after the copyrighted work being placed in the stream of commerce. And, as any contract law 101 would teach, the free, unsolicited distribution did not create a license. And the commentators had explained that "first sale" really means "first transfer:" Although this statutory limitation is commonly referred to as the first sale doctrine, its protection does not require a "sale." The doctrine applies after the "first authorized disposition by which title passes." 2 Nimmer § 8.12[B][1][a]. This passing of title may occur through a transfer by gift. See 4 William F. Patry, Patry on Copyright § 13:15 ("Since the principle [of the first sale doctrine] applies when copies are given away or are otherwise permanently transferred without the accoutrements of a sale, 'exhaustion' is the better description."); 2 Paul Goldstein, Goldstein on Copyright § 7.6.1 n.4 (3d ed.) ("[A] gift of copies or phonorecords will qualify as a 'first sale' to the same extent as an actual sale for consideration.").
Best of all, there is a Unordered Merchandise Statute. Because the discs were unordered merchandise, the recipients were free to “retain, use, discard, or dispose” of them as they saw fit under the Unordered Merchandise Statute." That statute does, indeed, make unordered merchandise a gift. Kudos to the defense lawyers for this research.
The 9th Circuit dismissed the infringement claim. I am safe for receiving Iggy Pop. And future lawyers will try to understand what was a cd . . .
Monday, April 5, 2010
Fees . . fees. . . fees . .
Section 505 of the Copyright Act provides:
In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney's fee to the prevailing party as part of the costs.
Seems simple.
The court has two tasks in applying §505: first, deciding whether an award of attorney's fees is appropriate and, second, calculating the amount of the award.
Simple again.
When is an award appropriate? One must be a "prevailing party," meaning that ". . . one has to be awarded some relief by the court. Id. at 603, 121 S.Ct. 1835. The key inquiry is whether some court action has created a “material alteration of the legal relationship of the parties.” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001).
So, once one prevails, the analysis goes on because, even if a plaintiff or defendant "prevails," the Supreme Court in rejected a rule requiring attorneys' fees in copyright infringement cases as a matter of course, instead leaving the question of attorneys fees to the discretion of district courts. Fogerty v. Fantasy, Inc., 510 U.S. 517, 114 S.Ct. 1023, 127 L.Ed.2d 455 (1994). The Supremes ruled that “attorneys' fees are to be awarded to prevailing parties only as a matter of the court's discretion.”).
So, how does a Court determine its discretion? The Ninth Circuit tells the Court to look at factors. Five factors. They are:
(1) the degree of success obtained;
(2) frivolousness;
(3) motivation;
(4) objective unreasonableness (both in the factual and legal arguments in the case); and
(5) the need in particular circumstances to advance considerations of compensation and deterrence.
But, remember: the applicable standard depends on the statute, and Section 505 simply authorizes fee awards to the prevailing party.
In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney's fee to the prevailing party as part of the costs.
Seems simple.
The court has two tasks in applying §505: first, deciding whether an award of attorney's fees is appropriate and, second, calculating the amount of the award.
Simple again.
When is an award appropriate? One must be a "prevailing party," meaning that ". . . one has to be awarded some relief by the court. Id. at 603, 121 S.Ct. 1835. The key inquiry is whether some court action has created a “material alteration of the legal relationship of the parties.” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001).
So, once one prevails, the analysis goes on because, even if a plaintiff or defendant "prevails," the Supreme Court in rejected a rule requiring attorneys' fees in copyright infringement cases as a matter of course, instead leaving the question of attorneys fees to the discretion of district courts. Fogerty v. Fantasy, Inc., 510 U.S. 517, 114 S.Ct. 1023, 127 L.Ed.2d 455 (1994). The Supremes ruled that “attorneys' fees are to be awarded to prevailing parties only as a matter of the court's discretion.”).
So, how does a Court determine its discretion? The Ninth Circuit tells the Court to look at factors. Five factors. They are:
(1) the degree of success obtained;
(2) frivolousness;
(3) motivation;
(4) objective unreasonableness (both in the factual and legal arguments in the case); and
(5) the need in particular circumstances to advance considerations of compensation and deterrence.
But, remember: the applicable standard depends on the statute, and Section 505 simply authorizes fee awards to the prevailing party.
Fees . . fees. . . fees . .
Section 505 of the Copyright Act provides:
In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney's fee to the prevailing party as part of the costs.
Seems simple.
The court has two tasks in applying §505: first, deciding whether an award of attorney's fees is appropriate and, second, calculating the amount of the award.
Simple again.
When is an award appropriate? One must be a "prevailing party," meaning that ". . . one has to be awarded some relief by the court. Id. at 603, 121 S.Ct. 1835. The key inquiry is whether some court action has created a “material alteration of the legal relationship of the parties.” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001).
So, once one prevails, the analysis goes on because, even if a plaintiff or defendant "prevails," the Supreme Court in rejected a rule requiring attorneys' fees in copyright infringement cases as a matter of course, instead leaving the question of attorneys fees to the discretion of district courts. Fogerty v. Fantasy, Inc., 510 U.S. 517, 114 S.Ct. 1023, 127 L.Ed.2d 455 (1994). The Supremes ruled that “attorneys' fees are to be awarded to prevailing parties only as a matter of the court's discretion.”).
So, how does a Court determine its discretion? The Ninth Circuit tells the Court to look at factors. Five factors. They are:
(1) the degree of success obtained;
(2) frivolousness;
(3) motivation;
(4) objective unreasonableness (both in the factual and legal arguments in the case); and
(5) the need in particular circumstances to advance considerations of compensation and deterrence.
But, remember: the applicable standard depends on the statute, and Section 505 simply authorizes fee awards to the prevailing party.
In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney's fee to the prevailing party as part of the costs.
Seems simple.
The court has two tasks in applying §505: first, deciding whether an award of attorney's fees is appropriate and, second, calculating the amount of the award.
Simple again.
When is an award appropriate? One must be a "prevailing party," meaning that ". . . one has to be awarded some relief by the court. Id. at 603, 121 S.Ct. 1835. The key inquiry is whether some court action has created a “material alteration of the legal relationship of the parties.” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001).
So, once one prevails, the analysis goes on because, even if a plaintiff or defendant "prevails," the Supreme Court in rejected a rule requiring attorneys' fees in copyright infringement cases as a matter of course, instead leaving the question of attorneys fees to the discretion of district courts. Fogerty v. Fantasy, Inc., 510 U.S. 517, 114 S.Ct. 1023, 127 L.Ed.2d 455 (1994). The Supremes ruled that “attorneys' fees are to be awarded to prevailing parties only as a matter of the court's discretion.”).
So, how does a Court determine its discretion? The Ninth Circuit tells the Court to look at factors. Five factors. They are:
(1) the degree of success obtained;
(2) frivolousness;
(3) motivation;
(4) objective unreasonableness (both in the factual and legal arguments in the case); and
(5) the need in particular circumstances to advance considerations of compensation and deterrence.
But, remember: the applicable standard depends on the statute, and Section 505 simply authorizes fee awards to the prevailing party.
Saturday, April 19, 2008
Fairly Harry Potter
A lexicon presents the language of a field or area. The "HP Lexicon" began as a website where contributors collected information about people, places, and things that inhabit the Harry Potter universe. Those who care about these things Harry Potter regard it as the most complete and authoritative guide to the world of Harry Potter, and it attracts upwards of 25 million visitors per year. The HP Lexicon’s editor decided to publish the HP Lexicon in book form, and RDR Books agreed to do so. Ms J.K. Rowling and Warner Brothers filed suit against RDR, alleging claims for copyright and trademark infringement, and seeking to stop publication of the book.
The issue is fair use, the most misunderstood area of copyright law. Judge Posner has noted that "copying that is complementary to the copyrighted work (in the sense that nails are complements of hammers) is fair use, but copying that is a substitute for the copyrighted work (in the sense that nails are substitutes for pegs or screws), or for derivative works from the copyrighted work . . . is not fair use." Ty Inc. v. Publications International, 292 F.3d 512 (7th Cir. 2002). His economic approach is not really codified in the law, but it does focus on the core concept: is the new work a substitute for the copied work. Following Judge Posner's logic, the Lexicon seems to complement rather than replace Ms Rowling's works, and to do her no harm.
But first, fair use. Judge Posner aptly points out that the statute confuses rather than helps. It says that "the fair use of a copyrighted work... for purposes such as criticism, comment, news reporting, teaching ... scholarship or research, is not an infringement of copyright." 17 U.S.C. § 107. In deciding whether a particular use is fair, the "factors to be considered shall include(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work." This is a list, not a test. So, what is the judge in the Harry Potter case to do?
That is easy enough -- right. Often courts confuse the "sweat of the brow" as the source of copryightable material. It is not. It is just the originality and expression, no matter how difficult or easy the effort, that is protected. The real issue for Ms Rowling is whether the Lexicon infringes her rights to develop derivative works. The Copyright code defines a derivative work as "a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted." 17 U.S.C. § 101. Does producing a Lexicon in book form compete with the rights of Ms Rowling and her empire to produce her own Lexicon as a derivative work? Yes; but is a Lexicon a derivative work? That is, does it recast, transform, or adapt the work?
The issue is fair use, the most misunderstood area of copyright law. Judge Posner has noted that "copying that is complementary to the copyrighted work (in the sense that nails are complements of hammers) is fair use, but copying that is a substitute for the copyrighted work (in the sense that nails are substitutes for pegs or screws), or for derivative works from the copyrighted work . . . is not fair use." Ty Inc. v. Publications International, 292 F.3d 512 (7th Cir. 2002). His economic approach is not really codified in the law, but it does focus on the core concept: is the new work a substitute for the copied work. Following Judge Posner's logic, the Lexicon seems to complement rather than replace Ms Rowling's works, and to do her no harm.
But first, fair use. Judge Posner aptly points out that the statute confuses rather than helps. It says that "the fair use of a copyrighted work... for purposes such as criticism, comment, news reporting, teaching ... scholarship or research, is not an infringement of copyright." 17 U.S.C. § 107. In deciding whether a particular use is fair, the "factors to be considered shall include(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work." This is a list, not a test. So, what is the judge in the Harry Potter case to do?
That is easy enough -- right. Often courts confuse the "sweat of the brow" as the source of copryightable material. It is not. It is just the originality and expression, no matter how difficult or easy the effort, that is protected. The real issue for Ms Rowling is whether the Lexicon infringes her rights to develop derivative works. The Copyright code defines a derivative work as "a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted." 17 U.S.C. § 101. Does producing a Lexicon in book form compete with the rights of Ms Rowling and her empire to produce her own Lexicon as a derivative work? Yes; but is a Lexicon a derivative work? That is, does it recast, transform, or adapt the work?
Fairly Harry Potter
A lexicon presents the language of a field or area. The "HP Lexicon" began as a website where contributors collected information about people, places, and things that inhabit the Harry Potter universe. Those who care about these things Harry Potter regard it as the most complete and authoritative guide to the world of Harry Potter, and it attracts upwards of 25 million visitors per year. The HP Lexicon’s editor decided to publish the HP Lexicon in book form, and RDR Books agreed to do so. Ms J.K. Rowling and Warner Brothers filed suit against RDR, alleging claims for copyright and trademark infringement, and seeking to stop publication of the book.
The issue is fair use, the most misunderstood area of copyright law. Judge Posner has noted that "copying that is complementary to the copyrighted work (in the sense that nails are complements of hammers) is fair use, but copying that is a substitute for the copyrighted work (in the sense that nails are substitutes for pegs or screws), or for derivative works from the copyrighted work . . . is not fair use." Ty Inc. v. Publications International, 292 F.3d 512 (7th Cir. 2002). His economic approach is not really codified in the law, but it does focus on the core concept: is the new work a substitute for the copied work. Following Judge Posner's logic, the Lexicon seems to complement rather than replace Ms Rowling's works, and to do her no harm.
But first, fair use. Judge Posner aptly points out that the statute confuses rather than helps. It says that "the fair use of a copyrighted work... for purposes such as criticism, comment, news reporting, teaching ... scholarship or research, is not an infringement of copyright." 17 U.S.C. § 107. In deciding whether a particular use is fair, the "factors to be considered shall include(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work." This is a list, not a test. So, what is the judge in the Harry Potter case to do?
That is easy enough -- right. Often courts confuse the "sweat of the brow" as the source of copryightable material. It is not. It is just the originality and expression, no matter how difficult or easy the effort, that is protected. The real issue for Ms Rowling is whether the Lexicon infringes her rights to develop derivative works. The Copyright code defines a derivative work as "a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted." 17 U.S.C. § 101. Does producing a Lexicon in book form compete with the rights of Ms Rowling and her empire to produce her own Lexicon as a derivative work? Yes; but is a Lexicon a derivative work? That is, does it recast, transform, or adapt the work?
The issue is fair use, the most misunderstood area of copyright law. Judge Posner has noted that "copying that is complementary to the copyrighted work (in the sense that nails are complements of hammers) is fair use, but copying that is a substitute for the copyrighted work (in the sense that nails are substitutes for pegs or screws), or for derivative works from the copyrighted work . . . is not fair use." Ty Inc. v. Publications International, 292 F.3d 512 (7th Cir. 2002). His economic approach is not really codified in the law, but it does focus on the core concept: is the new work a substitute for the copied work. Following Judge Posner's logic, the Lexicon seems to complement rather than replace Ms Rowling's works, and to do her no harm.
But first, fair use. Judge Posner aptly points out that the statute confuses rather than helps. It says that "the fair use of a copyrighted work... for purposes such as criticism, comment, news reporting, teaching ... scholarship or research, is not an infringement of copyright." 17 U.S.C. § 107. In deciding whether a particular use is fair, the "factors to be considered shall include(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work." This is a list, not a test. So, what is the judge in the Harry Potter case to do?
That is easy enough -- right. Often courts confuse the "sweat of the brow" as the source of copryightable material. It is not. It is just the originality and expression, no matter how difficult or easy the effort, that is protected. The real issue for Ms Rowling is whether the Lexicon infringes her rights to develop derivative works. The Copyright code defines a derivative work as "a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted." 17 U.S.C. § 101. Does producing a Lexicon in book form compete with the rights of Ms Rowling and her empire to produce her own Lexicon as a derivative work? Yes; but is a Lexicon a derivative work? That is, does it recast, transform, or adapt the work?
Tuesday, April 8, 2008
Deemed Distribution of Nude Women . . . I Mean Pictures . . .
The internet, occasionally, has been used to disseminate pictures of nudity. Whether art or free expression, it is distribution, and if the material is copyrightable, then the owner has the right to their distribution. So, does the Ninth Circuit's analysis of pictures of nude women help us understand the copyright issues relating to file sharing?
Perfect10 sues Google, objecting to their use of the Perfect10 pictures in the Gooogle system. Actually, Perfect10 asserts infringement of its display rights, which really does not help us understand file-sharing issues if the files are not pictures, but music. And the Ninth Circuit discusses the genealogy case, Hotaling, and Napster for its analysis.
The Ninth Circuit panel states that "Perfect 10 incorrectly relies on Hotaling v. Church of Jesus Christ of Latter-Day Saints and Napster for the proposition that merely making images 'available' violates the copyright owner’s distribution right. Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir. 1997); Napster, 239 F.3d 1004. Hotaling held that the owner of a collection of works who makes them available to the public may be deemed to have distributed copies of the works. Hotaling, 118 F.3d at 203. Similarly, the distribution rights of the plaintiff copyright owners were infringed by Napster users (private individuals with collections of music files stored on their home computers) when they used the Napster software to make their collections available to all other Napster users. Napster, 239 F.3d at 1011-14." The Ninth Circuit panel calls this "deemed distribution."
Since Google did not have a copy of Perfect10's nude women, but linked to them, the Ninth Circuit reasoned that Google could not distribute copies. File sharers do own a copy of the work. They are a big step down the road to deemed distribution.
Next,the even bigger hurdle, contributory infringement. “One infringes contributorily by intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it.” Grokster, 545 U.S. at 930.
Perfect10 sues Google, objecting to their use of the Perfect10 pictures in the Gooogle system. Actually, Perfect10 asserts infringement of its display rights, which really does not help us understand file-sharing issues if the files are not pictures, but music. And the Ninth Circuit discusses the genealogy case, Hotaling, and Napster for its analysis.
The Ninth Circuit panel states that "Perfect 10 incorrectly relies on Hotaling v. Church of Jesus Christ of Latter-Day Saints and Napster for the proposition that merely making images 'available' violates the copyright owner’s distribution right. Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir. 1997); Napster, 239 F.3d 1004. Hotaling held that the owner of a collection of works who makes them available to the public may be deemed to have distributed copies of the works. Hotaling, 118 F.3d at 203. Similarly, the distribution rights of the plaintiff copyright owners were infringed by Napster users (private individuals with collections of music files stored on their home computers) when they used the Napster software to make their collections available to all other Napster users. Napster, 239 F.3d at 1011-14." The Ninth Circuit panel calls this "deemed distribution."
Since Google did not have a copy of Perfect10's nude women, but linked to them, the Ninth Circuit reasoned that Google could not distribute copies. File sharers do own a copy of the work. They are a big step down the road to deemed distribution.
Next,the even bigger hurdle, contributory infringement. “One infringes contributorily by intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it.” Grokster, 545 U.S. at 930.
Deemed Distribution of Nude Women . . . I Mean Pictures . . .
The internet, occasionally, has been used to disseminate pictures of nudity. Whether art or free expression, it is distribution, and if the material is copyrightable, then the owner has the right to their distribution. So, does the Ninth Circuit's analysis of pictures of nude women help us understand the copyright issues relating to file sharing?
Perfect10 sues Google, objecting to their use of the Perfect10 pictures in the Gooogle system. Actually, Perfect10 asserts infringement of its display rights, which really does not help us understand file-sharing issues if the files are not pictures, but music. And the Ninth Circuit discusses the genealogy case, Hotaling, and Napster for its analysis.
The Ninth Circuit panel states that "Perfect 10 incorrectly relies on Hotaling v. Church of Jesus Christ of Latter-Day Saints and Napster for the proposition that merely making images 'available' violates the copyright owner’s distribution right. Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir. 1997); Napster, 239 F.3d 1004. Hotaling held that the owner of a collection of works who makes them available to the public may be deemed to have distributed copies of the works. Hotaling, 118 F.3d at 203. Similarly, the distribution rights of the plaintiff copyright owners were infringed by Napster users (private individuals with collections of music files stored on their home computers) when they used the Napster software to make their collections available to all other Napster users. Napster, 239 F.3d at 1011-14." The Ninth Circuit panel calls this "deemed distribution."
Since Google did not have a copy of Perfect10's nude women, but linked to them, the Ninth Circuit reasoned that Google could not distribute copies. File sharers do own a copy of the work. They are a big step down the road to deemed distribution.
Next,the even bigger hurdle, contributory infringement. “One infringes contributorily by intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it.” Grokster, 545 U.S. at 930.
Perfect10 sues Google, objecting to their use of the Perfect10 pictures in the Gooogle system. Actually, Perfect10 asserts infringement of its display rights, which really does not help us understand file-sharing issues if the files are not pictures, but music. And the Ninth Circuit discusses the genealogy case, Hotaling, and Napster for its analysis.
The Ninth Circuit panel states that "Perfect 10 incorrectly relies on Hotaling v. Church of Jesus Christ of Latter-Day Saints and Napster for the proposition that merely making images 'available' violates the copyright owner’s distribution right. Hotaling v. Church of Jesus Christ of Latter-Day Saints, 118 F.3d 199 (4th Cir. 1997); Napster, 239 F.3d 1004. Hotaling held that the owner of a collection of works who makes them available to the public may be deemed to have distributed copies of the works. Hotaling, 118 F.3d at 203. Similarly, the distribution rights of the plaintiff copyright owners were infringed by Napster users (private individuals with collections of music files stored on their home computers) when they used the Napster software to make their collections available to all other Napster users. Napster, 239 F.3d at 1011-14." The Ninth Circuit panel calls this "deemed distribution."
Since Google did not have a copy of Perfect10's nude women, but linked to them, the Ninth Circuit reasoned that Google could not distribute copies. File sharers do own a copy of the work. They are a big step down the road to deemed distribution.
Next,the even bigger hurdle, contributory infringement. “One infringes contributorily by intentionally inducing or encouraging direct infringement, and infringes vicariously by profiting from direct infringement while declining to exercise a right to stop or limit it.” Grokster, 545 U.S. at 930.
File Sharing . . . Do Students Really Have Direct Knowledge?
So the big issue is whether merely placing copyrighted files in a shared folder available to others over the internet infringes the copyright owner's exclusive right to distribute the copyrighted work. But "distribute" is a term of art in the copyright statutes, meaning the exclusive right "to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." 17 U.S.C. § 106(3). Applying the statute, placing a copyrighted file in a shared folder, for public use, seems to show intent to transfer ownership (in contrast to, say, placing the files in a folder accessible only by yourself). This still begs the question of whether an actual transfer must be shown.
The Napster case in the Ninth Circuit approaches this differently, focusing on contributory copyright infringement. “[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.” Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971); see also Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir. 1996). The Ninth Circuit explains, in Napster, that "liability exists if the defendant engages in “personal conduct that encourages or assists the infringement.” Matthew Bender & Co. v. West Publ’g Co., 158 F.3d 693, 706 (2d Cir. 1998). The Ninth Circuit then stated that Napster had direct knowledge of actual infringement, and the walls came tumbling down. Does this "direct knowledge" requirement apply to the student file sharer using a service like Limeware?
The Napster case in the Ninth Circuit approaches this differently, focusing on contributory copyright infringement. “[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.” Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971); see also Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir. 1996). The Ninth Circuit explains, in Napster, that "liability exists if the defendant engages in “personal conduct that encourages or assists the infringement.” Matthew Bender & Co. v. West Publ’g Co., 158 F.3d 693, 706 (2d Cir. 1998). The Ninth Circuit then stated that Napster had direct knowledge of actual infringement, and the walls came tumbling down. Does this "direct knowledge" requirement apply to the student file sharer using a service like Limeware?
File Sharing . . . Do Students Really Have Direct Knowledge?
So the big issue is whether merely placing copyrighted files in a shared folder available to others over the internet infringes the copyright owner's exclusive right to distribute the copyrighted work. But "distribute" is a term of art in the copyright statutes, meaning the exclusive right "to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending." 17 U.S.C. § 106(3). Applying the statute, placing a copyrighted file in a shared folder, for public use, seems to show intent to transfer ownership (in contrast to, say, placing the files in a folder accessible only by yourself). This still begs the question of whether an actual transfer must be shown.
The Napster case in the Ninth Circuit approaches this differently, focusing on contributory copyright infringement. “[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.” Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971); see also Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir. 1996). The Ninth Circuit explains, in Napster, that "liability exists if the defendant engages in “personal conduct that encourages or assists the infringement.” Matthew Bender & Co. v. West Publ’g Co., 158 F.3d 693, 706 (2d Cir. 1998). The Ninth Circuit then stated that Napster had direct knowledge of actual infringement, and the walls came tumbling down. Does this "direct knowledge" requirement apply to the student file sharer using a service like Limeware?
The Napster case in the Ninth Circuit approaches this differently, focusing on contributory copyright infringement. “[O]ne who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.” Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971); see also Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir. 1996). The Ninth Circuit explains, in Napster, that "liability exists if the defendant engages in “personal conduct that encourages or assists the infringement.” Matthew Bender & Co. v. West Publ’g Co., 158 F.3d 693, 706 (2d Cir. 1998). The Ninth Circuit then stated that Napster had direct knowledge of actual infringement, and the walls came tumbling down. Does this "direct knowledge" requirement apply to the student file sharer using a service like Limeware?
Monday, April 7, 2008
File Posting or File Sharing? Which is Illegal?
So put yourself in the position of a judge. The record industry brings to you the head of the local college student. The copyright statutes bring you statutory damages of $750 per violation at a minimum. It is the copyright version of sentencing guidelines, leaving you a complete lack of discretion.
It has to be tough to be the judge. If this does not seem right, what do you do? Well, tighten the liability standards. And that is the question judges now face in file-sharing cases.
Judge Nancy Gertner of Boston felt that "merely exposing music files to the Internet is not copyright infringement" because those doing so could claim "they did not know that logging onto the peer-to-peer network would allow others to access these particular files." Judge Kenneth Karras in New York said just the opposite, that placing a copyrighted music file in a computer folder shared by peer-to-peer software users could amount to illegal publication of it.
At issue is what level of proof is required: just making the copyrighted digital files available on a shared network, or a showing that the digital files were actually shared. Judge Neil Wake of Phoenix is addressing this very issue in Atlantic v. Howell. The Howells contend that their file-sharing program was "not set up to share" and that the files were "for private use" and "for transfer to portable devices, that is legal for 'fair use.'" Judge Wake initially rejected their argument, but is now re-considering. But first, the Church of Jesus Christ of Latter Day Saints and Napster.
Yep. The Mormon Church was sued for placing an unauthorized copy of a genealogicial work in its collection and including the copy in its catalog or index system, making the copy available to the public. The District Court said this was not enough, but the Fourth Circuit reversed. It reasoned that "[w]hen a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public," violating §106(3). So, is a shared folder on limeware a "public library?" Judge Hall, in dissent, reads the statute, and says "the owner of a copyright does not possess an exclusive right to 'distribute' the work in any conceivable manner; instead, it has the exclusive right 'to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending [.]' 17 U.S.C. § 106(3)." He notes that all use was in the library, and perhaps should be copyright infringement even if the work was not lent, but just used in the library; but, under the statute, it is not illegal distribution because Congress said "lending" is required. He's the minority in the Fourth Circuit, though.
But what about that public file? If another uses the folder, it seems like that would be lending the file. That fails to answer the question of what needs to be proved: merely an offer or an actual file-share? If one plays a song in the presence of another, is that lending? If the file remains only on your hard disk, but another plays it remotely, is that lending? The Ninth Circuit already has discussed file sharing in Napster, has it not? And everyone knows Napster. Or do they?
It has to be tough to be the judge. If this does not seem right, what do you do? Well, tighten the liability standards. And that is the question judges now face in file-sharing cases.
Judge Nancy Gertner of Boston felt that "merely exposing music files to the Internet is not copyright infringement" because those doing so could claim "they did not know that logging onto the peer-to-peer network would allow others to access these particular files." Judge Kenneth Karras in New York said just the opposite, that placing a copyrighted music file in a computer folder shared by peer-to-peer software users could amount to illegal publication of it.
At issue is what level of proof is required: just making the copyrighted digital files available on a shared network, or a showing that the digital files were actually shared. Judge Neil Wake of Phoenix is addressing this very issue in Atlantic v. Howell. The Howells contend that their file-sharing program was "not set up to share" and that the files were "for private use" and "for transfer to portable devices, that is legal for 'fair use.'" Judge Wake initially rejected their argument, but is now re-considering. But first, the Church of Jesus Christ of Latter Day Saints and Napster.
Yep. The Mormon Church was sued for placing an unauthorized copy of a genealogicial work in its collection and including the copy in its catalog or index system, making the copy available to the public. The District Court said this was not enough, but the Fourth Circuit reversed. It reasoned that "[w]hen a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public," violating §106(3). So, is a shared folder on limeware a "public library?" Judge Hall, in dissent, reads the statute, and says "the owner of a copyright does not possess an exclusive right to 'distribute' the work in any conceivable manner; instead, it has the exclusive right 'to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending [.]' 17 U.S.C. § 106(3)." He notes that all use was in the library, and perhaps should be copyright infringement even if the work was not lent, but just used in the library; but, under the statute, it is not illegal distribution because Congress said "lending" is required. He's the minority in the Fourth Circuit, though.
But what about that public file? If another uses the folder, it seems like that would be lending the file. That fails to answer the question of what needs to be proved: merely an offer or an actual file-share? If one plays a song in the presence of another, is that lending? If the file remains only on your hard disk, but another plays it remotely, is that lending? The Ninth Circuit already has discussed file sharing in Napster, has it not? And everyone knows Napster. Or do they?
File Posting or File Sharing? Which is Illegal?
So put yourself in the position of a judge. The record industry brings to you the head of the local college student. The copyright statutes bring you statutory damages of $750 per violation at a minimum. It is the copyright version of sentencing guidelines, leaving you a complete lack of discretion.
It has to be tough to be the judge. If this does not seem right, what do you do? Well, tighten the liability standards. And that is the question judges now face in file-sharing cases.
Judge Nancy Gertner of Boston felt that "merely exposing music files to the Internet is not copyright infringement" because those doing so could claim "they did not know that logging onto the peer-to-peer network would allow others to access these particular files." Judge Kenneth Karras in New York said just the opposite, that placing a copyrighted music file in a computer folder shared by peer-to-peer software users could amount to illegal publication of it.
At issue is what level of proof is required: just making the copyrighted digital files available on a shared network, or a showing that the digital files were actually shared. Judge Neil Wake of Phoenix is addressing this very issue in Atlantic v. Howell. The Howells contend that their file-sharing program was "not set up to share" and that the files were "for private use" and "for transfer to portable devices, that is legal for 'fair use.'" Judge Wake initially rejected their argument, but is now re-considering. But first, the Church of Jesus Christ of Latter Day Saints and Napster.
Yep. The Mormon Church was sued for placing an unauthorized copy of a genealogicial work in its collection and including the copy in its catalog or index system, making the copy available to the public. The District Court said this was not enough, but the Fourth Circuit reversed. It reasoned that "[w]hen a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public," violating §106(3). So, is a shared folder on limeware a "public library?" Judge Hall, in dissent, reads the statute, and says "the owner of a copyright does not possess an exclusive right to 'distribute' the work in any conceivable manner; instead, it has the exclusive right 'to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending [.]' 17 U.S.C. § 106(3)." He notes that all use was in the library, and perhaps should be copyright infringement even if the work was not lent, but just used in the library; but, under the statute, it is not illegal distribution because Congress said "lending" is required. He's the minority in the Fourth Circuit, though.
But what about that public file? If another uses the folder, it seems like that would be lending the file. That fails to answer the question of what needs to be proved: merely an offer or an actual file-share? If one plays a song in the presence of another, is that lending? If the file remains only on your hard disk, but another plays it remotely, is that lending? The Ninth Circuit already has discussed file sharing in Napster, has it not? And everyone knows Napster. Or do they?
It has to be tough to be the judge. If this does not seem right, what do you do? Well, tighten the liability standards. And that is the question judges now face in file-sharing cases.
Judge Nancy Gertner of Boston felt that "merely exposing music files to the Internet is not copyright infringement" because those doing so could claim "they did not know that logging onto the peer-to-peer network would allow others to access these particular files." Judge Kenneth Karras in New York said just the opposite, that placing a copyrighted music file in a computer folder shared by peer-to-peer software users could amount to illegal publication of it.
At issue is what level of proof is required: just making the copyrighted digital files available on a shared network, or a showing that the digital files were actually shared. Judge Neil Wake of Phoenix is addressing this very issue in Atlantic v. Howell. The Howells contend that their file-sharing program was "not set up to share" and that the files were "for private use" and "for transfer to portable devices, that is legal for 'fair use.'" Judge Wake initially rejected their argument, but is now re-considering. But first, the Church of Jesus Christ of Latter Day Saints and Napster.
Yep. The Mormon Church was sued for placing an unauthorized copy of a genealogicial work in its collection and including the copy in its catalog or index system, making the copy available to the public. The District Court said this was not enough, but the Fourth Circuit reversed. It reasoned that "[w]hen a public library adds a work to its collection, lists the work in its index or catalog system, and makes the work available to the borrowing or browsing public, it has completed all the steps necessary for distribution to the public," violating §106(3). So, is a shared folder on limeware a "public library?" Judge Hall, in dissent, reads the statute, and says "the owner of a copyright does not possess an exclusive right to 'distribute' the work in any conceivable manner; instead, it has the exclusive right 'to distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending [.]' 17 U.S.C. § 106(3)." He notes that all use was in the library, and perhaps should be copyright infringement even if the work was not lent, but just used in the library; but, under the statute, it is not illegal distribution because Congress said "lending" is required. He's the minority in the Fourth Circuit, though.
But what about that public file? If another uses the folder, it seems like that would be lending the file. That fails to answer the question of what needs to be proved: merely an offer or an actual file-share? If one plays a song in the presence of another, is that lending? If the file remains only on your hard disk, but another plays it remotely, is that lending? The Ninth Circuit already has discussed file sharing in Napster, has it not? And everyone knows Napster. Or do they?
Wednesday, March 26, 2008
The Cook, the Thief, the Lover, and the Wife . . .
That was a marvelously strange movie, years ago, with a wonderful title, written as bald allusion to British politics and Maggie Thatcher. The movie was a failure, despite some stunning visuals, but did present the question of who was responsible. And that's the issue in copyright today.
The Cook? Those who provide technology or software that facilitates copyright infringement. In our recent history, what became the VCR and allowed copying of video for use when we wanted, a precursor to Tivo and DVR's, raised the question of copying for personal use without paying a license fee (even though some copying was obviously not for personal use, but for replicating for others). At one one time the Lover, the content providers like movie and recording studios, opposed the use of VCR's without payment to them, a rather luddite approach. The Cooks today are file sharing services and internet providers and others who provide new technology that facilitate copying.
The Thief? Usually a child or youth or student or young adult who just wants his or her content, and sees an opportunity to get it inexpensively. This is a candy store, and few of the thieves see themselves as stealing.
The Wife? The Court system, who has to sort this mess out. And the primary wife is the Ninth Circuit, the home of the industry seeking protection. One article explains the current conundrum:
So, what approaches are being used? My bias is simple: the economic consequences of the law must be evaluated, and the legal rules that promote the most benefit for society chosen. This is quite different than a "property law" analysis urged by copyright owners; but, copyright law already imposes blanket licenses at times.
We'll think more about this in coming days.
The Cook? Those who provide technology or software that facilitates copyright infringement. In our recent history, what became the VCR and allowed copying of video for use when we wanted, a precursor to Tivo and DVR's, raised the question of copying for personal use without paying a license fee (even though some copying was obviously not for personal use, but for replicating for others). At one one time the Lover, the content providers like movie and recording studios, opposed the use of VCR's without payment to them, a rather luddite approach. The Cooks today are file sharing services and internet providers and others who provide new technology that facilitate copying.
The Thief? Usually a child or youth or student or young adult who just wants his or her content, and sees an opportunity to get it inexpensively. This is a candy store, and few of the thieves see themselves as stealing.
The Wife? The Court system, who has to sort this mess out. And the primary wife is the Ninth Circuit, the home of the industry seeking protection. One article explains the current conundrum:
The most prominent lawsuits have been brought against vendors of peer-to-peer file sharing software—Napster, Aimster, and Grokster—who have been held liable under the judicial doctrines of vicarious liability and contributory infringement for the copyright violations committed by their users. Although these secondary liability doctrines are well established in copyright law, the Napster and Aimster decisions have expanded the role that illicit intent to profit from others’ copyrighted works plays in determining liability. The expanded scrutiny of intent makes it difficult for developers of copying and distribution technologies to predict their potential liability and undermines the limited immunity for the development of useful technologies that the Supreme Court established in its Sony decision.Sverker K. Hogberg, Columbia Law Review, http://www.columbialawreview.org/pdf/hogberg.pdf.
So, what approaches are being used? My bias is simple: the economic consequences of the law must be evaluated, and the legal rules that promote the most benefit for society chosen. This is quite different than a "property law" analysis urged by copyright owners; but, copyright law already imposes blanket licenses at times.
We'll think more about this in coming days.
The Cook, the Thief, the Lover, and the Wife . . .
That was a marvelously strange movie, years ago, with a wonderful title, written as bald allusion to British politics and Maggie Thatcher. The movie was a failure, despite some stunning visuals, but did present the question of who was responsible. And that's the issue in copyright today.
The Cook? Those who provide technology or software that facilitates copyright infringement. In our recent history, what became the VCR and allowed copying of video for use when we wanted, a precursor to Tivo and DVR's, raised the question of copying for personal use without paying a license fee (even though some copying was obviously not for personal use, but for replicating for others). At one one time the Lover, the content providers like movie and recording studios, opposed the use of VCR's without payment to them, a rather luddite approach. The Cooks today are file sharing services and internet providers and others who provide new technology that facilitate copying.
The Thief? Usually a child or youth or student or young adult who just wants his or her content, and sees an opportunity to get it inexpensively. This is a candy store, and few of the thieves see themselves as stealing.
The Wife? The Court system, who has to sort this mess out. And the primary wife is the Ninth Circuit, the home of the industry seeking protection. One article explains the current conundrum:
So, what approaches are being used? My bias is simple: the economic consequences of the law must be evaluated, and the legal rules that promote the most benefit for society chosen. This is quite different than a "property law" analysis urged by copyright owners; but, copyright law already imposes blanket licenses at times.
We'll think more about this in coming days.
The Cook? Those who provide technology or software that facilitates copyright infringement. In our recent history, what became the VCR and allowed copying of video for use when we wanted, a precursor to Tivo and DVR's, raised the question of copying for personal use without paying a license fee (even though some copying was obviously not for personal use, but for replicating for others). At one one time the Lover, the content providers like movie and recording studios, opposed the use of VCR's without payment to them, a rather luddite approach. The Cooks today are file sharing services and internet providers and others who provide new technology that facilitate copying.
The Thief? Usually a child or youth or student or young adult who just wants his or her content, and sees an opportunity to get it inexpensively. This is a candy store, and few of the thieves see themselves as stealing.
The Wife? The Court system, who has to sort this mess out. And the primary wife is the Ninth Circuit, the home of the industry seeking protection. One article explains the current conundrum:
The most prominent lawsuits have been brought against vendors of peer-to-peer file sharing software—Napster, Aimster, and Grokster—who have been held liable under the judicial doctrines of vicarious liability and contributory infringement for the copyright violations committed by their users. Although these secondary liability doctrines are well established in copyright law, the Napster and Aimster decisions have expanded the role that illicit intent to profit from others’ copyrighted works plays in determining liability. The expanded scrutiny of intent makes it difficult for developers of copying and distribution technologies to predict their potential liability and undermines the limited immunity for the development of useful technologies that the Supreme Court established in its Sony decision.Sverker K. Hogberg, Columbia Law Review, http://www.columbialawreview.org/pdf/hogberg.pdf.
So, what approaches are being used? My bias is simple: the economic consequences of the law must be evaluated, and the legal rules that promote the most benefit for society chosen. This is quite different than a "property law" analysis urged by copyright owners; but, copyright law already imposes blanket licenses at times.
We'll think more about this in coming days.
Tuesday, March 11, 2008
Even More Karoake . . .
Thank God copyright was invented to protect song owners against karoake. It appears that the karoake wars continue, and the battleground is the Ninth Circuit. Now the karoake record producers are suing each other and using copyright.
Who? Sybersound sued twelve competitors. What for? Cheating. Sybersound said its competitors represented to buyers that their songs were properly licensed, but they were not, and that they were using songs to which Sybersound held the copyright license. Sybersound attempts to couch a unique Lanham Act claim, i.e., that their competitors were improperly claiming to have copyright licenses, and Sybersound directly made a copyright infringement claim as a licensee.
To be fair, Sybersound says that the false representations to customers about having copyright permissions are the Lanham Act violations. But the Court would not go for this "theory":
The Ninth Circuit finds a Supreme Court case, Dastar, addressing the interplay between the Lanham Act and copyright. There, an author used the Lanham Act to claim that, after a television series passed into the public domain, the producer failed to attribute the series to him, and the Supremes said that using the Lanham Act to extend attribution of the source of goods through the Lanham Act would be granting a perpetual right to a facet of copyright, but it commented that making a misrepresentation would be a Lanham Act claim. So, Sybersound wins, right? Wrong. The Ninth Circuit argues that:
Perhaps the explanation is the Sybersound was greedy, also suing in copyright even though its assignment was not exclusive. The Copyright Act permits exclusive rights to be chopped up and owned separately, to be effective as a transfer of ownership, the assignment must be exclusive. And only owners may sue in copyright.
Who? Sybersound sued twelve competitors. What for? Cheating. Sybersound said its competitors represented to buyers that their songs were properly licensed, but they were not, and that they were using songs to which Sybersound held the copyright license. Sybersound attempts to couch a unique Lanham Act claim, i.e., that their competitors were improperly claiming to have copyright licenses, and Sybersound directly made a copyright infringement claim as a licensee.
To be fair, Sybersound says that the false representations to customers about having copyright permissions are the Lanham Act violations. But the Court would not go for this "theory":
Under copyright law, only copyright owners and exclusive licensees of copyright may enforce a copyright or a license. See 17 U.S.C. § 501(b) (conferring standing only to the “legal or beneficial owner of an exclusive right” who “is entitled . . . to institute an action for any infringement . . . while he or she is the owner of it”); Silvers, 402 F.3d at 885. Therefore, third party strangers and nonexclusive licensees cannot bring suit to enforce a copyright, even if an infringer is operating without a license to the detriment of a nonexclusive licensee who has paid full value for his license. See 3-10 Melville B. Nimmer;David Nimmer, Nimmer on Copyright, § 10.02 [B] [1] (2007).Does that really respond to the Plaintiff's theory?
The Ninth Circuit finds a Supreme Court case, Dastar, addressing the interplay between the Lanham Act and copyright. There, an author used the Lanham Act to claim that, after a television series passed into the public domain, the producer failed to attribute the series to him, and the Supremes said that using the Lanham Act to extend attribution of the source of goods through the Lanham Act would be granting a perpetual right to a facet of copyright, but it commented that making a misrepresentation would be a Lanham Act claim. So, Sybersound wins, right? Wrong. The Ninth Circuit argues that:
Construing the Lanham Act to cover misrepresentations about copyright licensing status as Sybersound urges would allow competitors engaged in the distribution of copyrightable materials to litigate the underlying copyright infringement when they have no standing to do so because they are nonexclusive licensees or third party strangers under copyright law, and we decline to do so.That makes little sense to me.
Perhaps the explanation is the Sybersound was greedy, also suing in copyright even though its assignment was not exclusive. The Copyright Act permits exclusive rights to be chopped up and owned separately, to be effective as a transfer of ownership, the assignment must be exclusive. And only owners may sue in copyright.
Even More Karoake . . .
Thank God copyright was invented to protect song owners against karoake. It appears that the karoake wars continue, and the battleground is the Ninth Circuit. Now the karoake record producers are suing each other and using copyright.
Who? Sybersound sued twelve competitors. What for? Cheating. Sybersound said its competitors represented to buyers that their songs were properly licensed, but they were not, and that they were using songs to which Sybersound held the copyright license. Sybersound attempts to couch a unique Lanham Act claim, i.e., that their competitors were improperly claiming to have copyright licenses, and Sybersound directly made a copyright infringement claim as a licensee.
To be fair, Sybersound says that the false representations to customers about having copyright permissions are the Lanham Act violations. But the Court would not go for this "theory":
The Ninth Circuit finds a Supreme Court case, Dastar, addressing the interplay between the Lanham Act and copyright. There, an author used the Lanham Act to claim that, after a television series passed into the public domain, the producer failed to attribute the series to him, and the Supremes said that using the Lanham Act to extend attribution of the source of goods through the Lanham Act would be granting a perpetual right to a facet of copyright, but it commented that making a misrepresentation would be a Lanham Act claim. So, Sybersound wins, right? Wrong. The Ninth Circuit argues that:
Perhaps the explanation is the Sybersound was greedy, also suing in copyright even though its assignment was not exclusive. The Copyright Act permits exclusive rights to be chopped up and owned separately, to be effective as a transfer of ownership, the assignment must be exclusive. And only owners may sue in copyright.
Who? Sybersound sued twelve competitors. What for? Cheating. Sybersound said its competitors represented to buyers that their songs were properly licensed, but they were not, and that they were using songs to which Sybersound held the copyright license. Sybersound attempts to couch a unique Lanham Act claim, i.e., that their competitors were improperly claiming to have copyright licenses, and Sybersound directly made a copyright infringement claim as a licensee.
To be fair, Sybersound says that the false representations to customers about having copyright permissions are the Lanham Act violations. But the Court would not go for this "theory":
Under copyright law, only copyright owners and exclusive licensees of copyright may enforce a copyright or a license. See 17 U.S.C. § 501(b) (conferring standing only to the “legal or beneficial owner of an exclusive right” who “is entitled . . . to institute an action for any infringement . . . while he or she is the owner of it”); Silvers, 402 F.3d at 885. Therefore, third party strangers and nonexclusive licensees cannot bring suit to enforce a copyright, even if an infringer is operating without a license to the detriment of a nonexclusive licensee who has paid full value for his license. See 3-10 Melville B. Nimmer;David Nimmer, Nimmer on Copyright, § 10.02 [B] [1] (2007).Does that really respond to the Plaintiff's theory?
The Ninth Circuit finds a Supreme Court case, Dastar, addressing the interplay between the Lanham Act and copyright. There, an author used the Lanham Act to claim that, after a television series passed into the public domain, the producer failed to attribute the series to him, and the Supremes said that using the Lanham Act to extend attribution of the source of goods through the Lanham Act would be granting a perpetual right to a facet of copyright, but it commented that making a misrepresentation would be a Lanham Act claim. So, Sybersound wins, right? Wrong. The Ninth Circuit argues that:
Construing the Lanham Act to cover misrepresentations about copyright licensing status as Sybersound urges would allow competitors engaged in the distribution of copyrightable materials to litigate the underlying copyright infringement when they have no standing to do so because they are nonexclusive licensees or third party strangers under copyright law, and we decline to do so.That makes little sense to me.
Perhaps the explanation is the Sybersound was greedy, also suing in copyright even though its assignment was not exclusive. The Copyright Act permits exclusive rights to be chopped up and owned separately, to be effective as a transfer of ownership, the assignment must be exclusive. And only owners may sue in copyright.
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