April 2013

New York State Court Blows a Hole in the DMCA Safe Harbors for Pre-1972 Sound Recordings

April 30, 2013

The recording companies have consistently maintained that the Digital Millennium Copyright Act’s (DMCA) notice-and-takedown regime does not apply to pre-1972 works. However, the law on this arcane issue has been scarce. In Capital Records v. MP3tunes (SDNY 2011), the court ruled that pre-1972 works were covered by the DMCA. After this decision the recording companies decided to make their argument in state court. Their strategy paid off – the New York State intermediate appellate court (the New York Supreme Court, Appellate Division), has issued a decision contrary to MP3tunes. In UMG Recordings v. Escape Media (often referred to as the Grooveshark* case), the court held that “Congress intended for the DMCA only to apply to post-1972 works.” *Grooveshark is a music streaming service that allows users to upload sound recordings.  According to Wikipedia, Grooveshark streams over one billion sound files a month. The Grooveshark case arises out of two legal oddities: first, Congress did not extend copyright protection to “sound recording” until it passed the 1972 Copyright Act (the effective date of protection being February 15, 1972); and second, before 1972 copyright was subject to state law. The upshot of this is that although the federal courts have exclusive jurisdiction over most copyright law claims, pre-1972 sound recordings are an exception. Claims for breach of pre-1972 sound recordings can be brought in state court and decided under the antiquated state copyright laws.*…

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Second Circuit Copyright Decision Vindicates Richard Prince’s “Appropriation Art”

April 28, 2013

Assume I were to take a well-known, in-copyright work of art, modify it in a variety of ways and publish the results as a coffee table book. To make this thought experiment easy, assume that the Statute of Liberty is covered by a U.S. copyright registration today—in fact, the Statue of Liberty was registered with the U.S. Copyright Office in 1876, but its registration has long-since expired. Assume I took 30 photographs of the Statue and published my book with the images modified in various ways. For example, I created collages, altered the face of the Statue and superimposed various objects on the Statue. Instead of holding a torch and a tablet, in one picture she is holding a photo of the head of Osama Bin Laden, and in anther she is holding a day-glo image of the World Trade Center buildings. In some cases I used only parts of the Statue, and in others I painted objects that obscured the face. You get the idea. Would the sculptor be able to assert copyright infringement, or would my book be protected by the copyright doctrine of fair use? The legal question, more precisely, would be: is my use of the Statue sufficiently transformative to qualify as fair use? An issue like this faced the Second Circuit Court of Appeals in a much-watched case, Cariou v. Prince. The court released its decision…

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What Happens When You Get A Federal District Court Judge Really, Really Mad In a Civil Case

April 24, 2013

I haven’t written a post that falls in the “what were they thinking” category for quite a while, but you don’t see this very often. In Angiodynamics v. Biolitec AG Massachusetts federal district court judge Michael Ponsor (pictured left) entered a preliminary injunction forbidding the defendant from entering into a merger with its German subsidiary corporation, so as not to put the company’s assets outside the reach of the plaintiff. In addition to corporate defendants, the corporate defendant’s CEO, Wolfgang Neuberger, was named as an individual defendant. The injunction order was appealed, and the First Circuit upheld the injunction. The defendant then went forward with the merger in direct violation of the court’s order. When Judge Ponsor received the plaintiff’s motion for contempt he ordered that Mr. Neuberger appear at the hearing on that motion. Neuberger declined to attend on the grounds that he was “afraid that the Court may . . . incarcerate him.” Based on my experience with Judge Ponsor, he is a relatively easy-going, patient judge (as federal judges go). Not in this case. In response to the plaintiff’s motion for contempt he wrote that the defendant violated the injunction “in every way it could be violated: text, substance, spirit, body, and soul.” Judge Ponsor has been on the federal bench for 25 years. He wrote that the defendants’ conduct “constitutes the most flagrantly offensive violation of…

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YouTube Scores Big Victory on Remand in Viacom DMCA Copyright Case

April 21, 2013

The copyright content industry has launched two no-holds-barred legal challenges against non-piratical websites that host third-party videos. That is, service providers whose intent is not obviously to induce or encourage copyright infringement and that follow the “notice and take down” rules of the Digital Millennium Copyright Act (DMCA).  Until last Thursday the outcome had been a complete loss for the content industry in one case, UMG v. Veoh (9th Cir. 2013). In the second case, Viacom v. YouTube, the content owners were hanging on by their fingernails following an adverse summary judgment ruling by Southern District of  New York District Court Judge Louis Stanton in 2010, followed by a largely (but not entirely) affirming decision by the Second Circuit in 2012. However, following Judge Stanton’s post-remand decision, issued on April 18, 2013, the content owners are left with a complete loss in the second case as well. Absent another appeal to the Second Circuit, Viacom v. YouTube is over. The outcome of these two cases in the influential Second and Ninth Circuits is not only a loss for the copyright owners, but a significant level of clarification as to what hosting sites such as YouTube and Veoh should do to ward off future attempts to pierce the copyright liability safe harbors created by the DMCA. The conclusion of the YouTube case (assuming no further appeal) is particularly significant. When Google purchased Youtube for $1.65 billion in…

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Video Porn Mass Copyright Litigation Plaintiffs Not Welcome in Massachusetts

April 16, 2013

Copyright owners who wish to file mass copyright suits based on a “BitTorrent Swarm” joinder theory—cases in which dozens (sometime hundreds) of anonymous defendants are joined in a single suit and then identified by serving subpoenas on their ISPs—are not welcome in Massachusetts. I’ve written about the phenomenon of BitTorrent swarm mass copyright suits before, but it looks like the door has been all but closed to these cases in the District of Massachusetts. As a reminder, here’s how these cases work. Assume you are the CFO of an adult movie publisher. Sales aren’t doing very well (given all the free porn on the Internet), and you’re under pressure to increase revenues. You hear about a gambit used by some other adult movie companies, and you decide to give it a try. You know your movies are being downloaded from the Internet, infringing your copyrights. You sue a group of downloaders, all of whom are part of the same “Bit Torrent Swarm,” as “Does”—that is, anonymous defendants whose names will be substituted into the suit at a later date. You contend that the fact they are part of the same “swarm” justifies joining them all in a single case.* *This argument relies on Rule 20(a)(1)) of the Federal Rules of Civil Procedure, which allows multiple defendants to be joined in a single case where the claims arise “out of the same transaction,…

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Federal Judge Tells Redigi to Shut It Down

April 2, 2013

As I reluctantly predicted last week, U.S District Court Judge Richard Sullivan has ruled that Redigi’s digital resale business is not protected by the first sale doctrine. His March 30, 2013 decision falls squarely in line with the arguments made by Capitol Records and rejects all of Redigi’s positions. I have written quite a bit on this case (here and here), and there is nothing new or surprising in the court’s decision. The court described the issue before it as “the novel question . . . whether a digital music file, lawfully made and purchased, may be resold by its owner through ReDigi under the first sale doctrine.” In answering this question the court emphasized that because it is “a court of law and not a congressional subcommittee or technology blog, the issues are narrow, technical, and purely legal.” Indeed, the court hewed closely to the statute. It noted that “the plain text of the Copyright Act makes clear that reproduction occurs when a copyright work is fixed in a new material object.”* The court states that “put another way, the first sale defense is limited to material items, like records, that the copyright owner put into the stream of commerce. Here, ReDigi is not distributing such material items; rather, it is distributing reproductions of the copyrighted code embedded in new material objects, namely, the ReDigi server in Arizona and its users’ hard…

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News Monitoring Service Based on AP Articles Not Protected by Fair Use

April 1, 2013

Do you think U.S. copyright law protects the author of this news snippet from copying? – Job seekers can roll the dice to land work at another of the four casinos coming soon to Ohio. Hollywood Casino Toledo has posted more than 600 job listings on its website this week. . . . restaurant workers, slots and table games supervisors, groundskeepers and security officers. The casino is scheduled to open in the spring with . . . How about this one? – The military intelligence complex an hour outside Washington where the WikiLeaks case goes to court this week is known as a cloak-and-dagger sanctum off-limits to the public — a reputation that’s only partly true. . . . low-level clearance and a Lady Gaga CD. The prosecution can only hope that their arguments, or the evidence, will reveal the secrets of how, . . . Would it make a difference if you knew that the 58 words in first excerpt are taken from a 109 word article, and the 61 words in the second article from a 540  word article, and that both articles were (as they appear) factual news pieces? People constantly ask “how much can I copy and be safe” under copyright law? Thirty seconds from a several minute piece of music?  10% of a news article?* *The “10% rule” and “30 second rule” have become the equivalent of legal urban legends. Neither has a basis under U.S. copyright law. The answers to these questions are most often determined by application…

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