June 2012

You Want to Enforce a Non-Compete? Bad Facts, Sir, Give Me Some Bad Facts!

June 22, 2012

What is the first thing a lawyer looks for when a client wants to enforce a non-compete agreement?  What is the first thing a lawyer hopes not to find when a client is the subject of a non-competition demand letter or lawsuit? Bad facts. Did the employee take confidential information belonging to the former employer?  Did the employee contact customers of the former employer and solicit them for the prospective employer before leaving the former employer?  If the employee was an executive or owed a fiduciary duty to the former employer, did the employee solicit other employees to leave with her? If the employee did any of these things, did the employee try to cover it up?  Bad facts!  The plaintiff’s lawyer will say.  Give me those bad facts! OK, I exaggerate a bit – of course a lawyer first wants to see if there is a written agreement that contains a non-compete provision.  But believe me, any experienced lawyer is itching to find those bad facts.  Lawyers know that judges are ambivalent about non-compete agreements, and putting someone out of work by issuing an preliminary injunction to enforce a non-compete provision is something few judges do with an easy conscience.  It’s no secret that there are some judges who will bend over backwards to find a way not to enforce a non-compete. So, lawyers trying to enforce these agreements know that the one…

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Video Game Company Misreads Copyright Law, Infringes Tetris

June 19, 2012

Tetris.  Popular?  Perhaps the best video game yet created, with over 200 million copies sold.  Mysterious?  It was developed by a Russian programmer during the cold war.  Scientific?  Think tetrominos, not MMOGs.  If you aren’t familiar with this game you should (a) reexamine your life, and (b) check it out. But does copyright law protect it against a knock-off that uses not only the same “ideas” (tetromino shaped tiles falling from the top of the screen, that need to be moved/rotated to fit into the openings below) but the exact screen height/width (in tile units)?  Shading and gradation of the pieces?  Creative aspects of animation (such as shadowing)?  Features, like previewing the next piece up? Desiree Golden may have thought so at first – she asked Tetris Holding Co. for a license, with no success.  So Golden’s company, Xio Interactive, went to Plan B, and created what it concluded would be a similar but non-infringing game.  According to the court’s decision, “before releasing its product, Xio researched copyright law, both through its own independent studying and based on advice of counsel.” However, judges have been known to disagree with lawyers, and in this case New Jersey U.S. District Court Judge Freda Wolsfon disagreed emphatically.  In her May 30, 2012 opinion she held that the appearance of Tetris was protected under copyright, and that Xio’s version of Tetris infringed Tetris based on the “total…

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Fourth Circuit Upholds Copyright Damages Based on Sales Abroad Under Rarely Applied “Predicate Acts” Doctrine

June 8, 2012

It is a well-known principle of copyright law that the Copyright Act has no extraterritorial reach.  For example, a U.S. copyright holder cannot bring suit for copyright infringement, in the U.S., against individuals or companies who reproduce and sell, outside the U.S., software, music CDs, DVDs or other copyright-protected works. What if, however, the initial infringement occurs in the United States, and the infringer distributes infringing copies outside the U.S.?  For example, what if an employee illegally copies an employer’s software program in the U.S., transports it to France (either on physical media or electronically), and sells it in Europe?  May the U.S. copyright holder recover damages based on lost profits or infringer profits in Europe? Surprisingly, this “infringe locally/sell abroad” issue has rarely come up under copyright case law in the U.S.  Until recently, only two courts have addressed it under the current copyright statute, the Second Circuit in 1988 (Update Art v. Modin) and the Ninth Circuit in 1998 (L.A. News Service v. Reuters).  However, in each of those cases the courts did permit recovery of damages arising from overseas infringing uses as long as the “predicate act” of infringement occurred within the United States, enabling further reproduction abroad.  By a “predicate act,” these courts meant simply that if the initial infringement took place in the U.S. and the foreign violations were directly linked to that infringement, then…

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