Copyright

The Music Licensing Marketplace is Not for the Faint of Heart

November 7, 2014

Over the last 100 years the musical licensing business has evolved into a complicated system! This is a consequence of the evolution of technology, business practices and copyright laws. A picture is worth a thousand words, and I’ve been meaning to post this attempt by the U.S. Copyright Office to create a graphic that illustrates how music licensing operates. The copyright office published this graphic earlier this year, as part of its Musical Licensing Study – one of three active policy studies in progress at the Copyright Office. Click on the image to expand it.   Here is Professor Fisher’s attempt to illustrate some of this in his 2014 CopyrightX course. This is a screenshot at approximately 11:00 in this CopyrightX video.    

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EU and UK Liberalize Access to Orphan Works – When Will the U.S. Catch Up?

November 6, 2014

One of the thorniest issues under the present U.S. copyright system is the law’s failure to accommodate the problem of  “orphan works” – works whose owners can’t be identified or located. In many cases copyright holders have died, gone out of business or simply stopped caring. This makes it difficult or impossible to obtain terms for the use of works that likely represent the majority of 20th century cultural artifacts, including songs, pictures, films, books, magazines and newspapers. Mass digitization technologies and the Internet have created opportunities to make these works widely accessible, but they have also created risks for copyright owners – for example, many digital photos that should be protected have had their metadata stripped before being posted on the Internet, creating a risk that protected works may be mistakenly misclassified as orphans. No one knows for sure how many bona fide orphan works there are, but estimates range between 25%  and 40% of all books eligible for copyright. The number seems to be particularly high in library and archive collections. However, because copyright protection has become “automatic” (no notice or registration required) and the term more difficult to ascertain (life-of-the-author-plus-70-years – when did the author die?), the user of an orphan work risks an infringement action. This is the risk that Google Books encountered in its attempt at mass digitization of books. Google had hoped it had found a solution to…

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Eleventh Circuit’s Fair Use Decision In Georgia State Leaves Uncertainty Over Use of Excerpts in University Course Packs

October 28, 2014

Academia is abuzz with reactions to the Eleventh Circuit’s copyright fair use decision in  Cambridge University Press v. Patton. This is, as one blogger described it, “the most important copyright and educational fair use case in recent memory.” The decision highlights, yet again, the truth behind Professor Nimmer’s observations that fair use is said to be “the most troublesome [area] in the whole of copyright law” and has been called “so flexible as virtually to defy definition.” At issue is Georgia State University’s right to scan and distribute to students, without payment, digital course packs comprised of excerpts from scholarly books and journals. The plaintiffs — several publishing houses — alleged 74 specific instances of infringement. In a 350 page ruling issued in May 2012 the district court court found infringement in only 5 of these cases, handing the university a significant victory and awarding it several million dollars in attorney’s fees. The U.S. Court of Appeals for the Eleventh Circuit (which covers federal appeals in Alabama, Florida and Georgia) reversed the district court, issuing its own mammoth opinion on October 17, 2014, (129 pages including the 16 pages of concurring opinion by one of the three judges on the panel). Needless to say, this case is of great importance to colleges and universities that want to provide their students with course packs without having to purchase “permissions” from publishers. It is, in effect, a test…

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The Kerfuffle Over Copyrights in Pre-1972 Sound Recordings

October 22, 2014

If you are confused by the news that a California federal court has ruled that satellite broadcaster Sirius XM is liable under California state law for streaming pre-1972 sound recordings by The Turtles,* you are not alone. The issues in this case prove, once again, Mark Twain’s complaint that “only one thing is impossible for God: To find any sense in any copyright law on the planet.” To appreciate this bizarre situation you may need to be reminded of a few basic principles of our arcane copyright laws: The copyright in a musical work (aka a musical composition) and a “sound recording” of that work may be separately owned. John Lennon’s estate may own the copyright to the musical work Imagine, but Ray Charles, Elton John and Queen (or their record labels) own the copyrights in their sound recordings of the song. Thus, a sound recording may give rise to legal rights under two separate copyrights with two different owners. When Congress passed the 1976 Copyright Act, the new federal law preempted most, but not all, state copyright laws. One area Congress expressly left untouched was copyright rights in the public performance of  sound recordings made before February 15, 1972. The public performance right for sound recordings will not become subject to federal law until February 15, 2067 (go figure). The federal vacuum for pre-1972 sound recordings left by the 1976 Act gives rise to an argument that…

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Two Recent Decisions Show the Strengths and Limitations of the CDA

October 10, 2014

Many observers have commented that if they had to identify one law that has had the greatest impact in encouraging the growth of the Internet, they would chose the Communications Decency Act  (“CDA”) (47 USC § 230).  Under the CDA (also often referred to as “Section 230”) web sites are not liable for user submitted content. As a practical matter, in most cases this means Internet providers are not liable for defamation posted by users (many of whom are anonymous or judgment-proof).*  *[note] The DMCA, not the CDA, provides Internet providers with safe harbors for claims of copyright infringement based on user submitted content. Two recent cases illustrate the reach and limitations of this law. In one case the CDA was held to protect the website owner from liability for defamation. In the other, the law did not protect the website from potential liability based on negligence. Jones v. Dirty World The CDA provides immunity from information provided by users. However, if a site itself is the “content provider” — for example, the author of defamation —  it is legally responsible for the publication. In other words, the CDA does not give Internet providers or web site owners license to engage in defamation, only immunity when their users do so. Under the CDA the term “content provider” is defined as a person “that is responsible, in whole or in part, for the creation or…

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Google Rolls the Dice, Files Cert Petition in Oracle Copyright Case

October 9, 2014

Google has filed a certiorari petition with the Supreme Court, asking it to review and reverse the Federal Circuit’s May 9, 2014 decision holding that the declaring code of Oracle’s Java API software is not copyrightable. I have written about this case on several occasions, most recently on May 10, 2014 (CAFC Reverses Judge Alsup – Java API Declaring Code Held Copyrightable). Google framed the “question presented” (framing the question in such a way as to catch the interest of the court is an art form in itself) as follows: Whether copyright protection extends to all elements of an original work of computer software, including a system or method of operation, that an author could have written in more than one way. The Supreme Court accepts review of approximately 1% of of cases appealed to it, and therefore lawyers spend a great deal of time and effort to make their cases as significant and interesting as possible. Here, Google asks the Court to take the case in order to decide an issue the Court deadlocked on in 1996 in Lotus v. Borland. Google’s brief states: In 1995, this Court granted certiorari in Lotus Development Corp. v. Borland International, Inc., 516 U.S. 233 (1996), to resolve the question presented here. The First Circuit had held―consistent with the plain language of 17 U.S.C. § 102(b) but in conflict with other courts of appeals―that methods of operation…

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Grooveshark’s Lesson: Better to Ask Permission Than Forgiveness

October 1, 2014

One thing that any online “music locker” company that relies on third-party content and hopes to benefit from the DMCA safe harbor should know is that employees should not upload copyrighted content to the service. Nothing will blow up a DMCA defense faster. It seems that Grooveshark (legally “Escape Media”), didn’t get this message. As Joshua Greenberg, one of Grooveshark’s co-founders wrote to employees in 2007: Download as many MP3′s as possible, and add them to the folders you’re sharing on Grooveshark. Some of us are setting up special ‘seed points’ to house tens or even hundreds of thousands of files, but we can’t do this alone… There is no reason why ANYONE in the company should not be able to do this, and I expect everyone to have this done by Monday… IF I DON’T HAVE AN EMAIL FROM YOU IN MY INBOX BY MONDAY, YOU’RE ON MY OFFICIAL SHIT LIST. Strong stuff, and not the kind of thing you want to have pop up in discovery. Grooveshark has been the target of multiple industry lawsuits. Two, in particular, are an action in SDNY in which the court, on September 29, 2014, entered summary judgment against Grooveshark, and a New York state action alleging infringement of pre-1972 sounds recordings, which at present are not covered by federal copyright law. However, it is difficult to see how the September 29th decision…

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Capitol Records Bares Knuckles in Redigi Suit, Goes After Founders

September 10, 2014

It’s a sad reality that when the record companies want to get serious, they sue not only companies that they claim have infringed their copyrights, but the owners of those companies. Capitol Records pursuit of Michael Robertson, despite the bankruptcy of MP3tunes, is a classic example. MP3tunes declared bankruptcy and shuttered its service, but Capitol Records (part of UMG), pursued Robertson individually, and obtained a $41 million verdict against him personally. Capitol is using the same strategy against Redigi (“the world’s first pre-owned digital marketplace”). I’ve written about Redigi several times (see here, here and here). The last of these, Federal Judge Tells Redigi to Shut it Down, posted April 2, 2013, describes the New York federal court’s decision holding that Redigi’s digital resale business is not protected by the first sale doctrine. In that post I noted that Redigi could face millions of dollars in damages, and that liability might not be limited to the company: Capitol may seek leave of court to add as defendants the individual owners and employees of Redigi that exercised control over or benefited from the infringement.  While Redigi could oppose such as motion as coming too late in the case, a decision would be at the discretion of the judge. As Capitol Records showed in its copyright suit against MP3tunes and Michael Robertson, Capitol is not above suing not only corporate infringers but their founders and owners….

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Ninth Circuit Hands Oracle a Tough Choice in Oracle v. SAP Copyright Ruling

September 6, 2014

Oracle faces a tough call following the Ninth Circuit’s August 29, 2014 decision in Oracle Corp. v. SAP AG. Should Oracle accept the $ 356.7 million in copyright damages the Ninth Circuit authorized on appeal, or roll the dice for a new trial, gambling that it can do better? I’ve written about this case before (see Oracle and SAP Avoid a Retrial, Go Directly to Appeal, in the Other “Tech Trial of the Century”). As I discussed in that September 2012 post, in 2010 Oracle won a record $1.3 billion copyright infringement jury verdict against SAP.  However, the trial judge held that the jury’s “hypothetical-license” damages award was based on undue speculation, and ordered remittitur, reducing the judgment to $272 million, and giving Oracle the choice of accepting that amount or retrying its damages case. Oracle and SAP then entered into a complex stipulation that allowed the parties to avoid an immediate retrial and permitted Oracle to appeal the district court remittitur order. The terms of the stipulation were as follows: The district court entered final judgment for $272 million. (This did not include interest or the $120 million in attorney’s fees that Oracle had already been paid by SAP). However, Oracle agreed not enforce the judgment until all appeals are concluded.   Now, assuming Oracle does not appeal to the Supreme Court, decision day has arrived for Oracle. The Ninth Circuit rejected Oracle’s appeal that it reinstate the $1.3 billion,…

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The U.S. Supreme Court IP Year in Review

September 3, 2014

[As initially published in the September 1, 2014 issue of Massachusetts Lawyers Weekly] A lot has changed in the realm of intellectual property law following the record-breaking ten intellectual property cases decided by the U.S. Supreme Court in its 2013 term. Highlights of the six unanimously decided patent cases include suits in which the Court narrowed the scope of patent protection for inventions implemented on computers, made it easier to invalidate a patent for indefiniteness, and made it easier for the district courts to shift attorneys’ fees to prevailing defendants. The Court issued two copyright decisions, including an important ruling that may have implications for cloud computing. And, one of the Court’s two Lanham Act opinions established a new doctrine for standing in false advertising cases. Patent Medtronic v. Mirowski Family Ventures (Jan. 22, 2014) was the first of five decisions overruling the Federal Circuit outright. The Court held that in a declaratory judgment action for non-infringement brought by a patent licensee, the burden of proving infringement lies with the licensor/patent holder, not the licensee. Medtronic can be seen as an extension of the Court’s 2007 decision in MedImmune, Inc. v. Genentech, holding that patent licensees have standing to bring declaratory judgment actions for non-infringement or invalidity, even as they continue to make royalty payments for the product in controversy. By placing the burden of proving infringement on patent owners, the Court has made it…

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Seventh Circuit Finds That Copyright Protection for Sherlock Holmes “Character” Has Expired

August 9, 2014

It may come as a surprise to some readers that fictional characters are protected by copyright law.  Even if the actual words used to describe a character are not copied, a “well delineated” or “especially distinctive” character may  receive copyright protection. Prominent examples from decided court cases include Rocky (under-appreciated, sullen, heroic boxer) and James Bond (British accent, tuxedos, “license to kill,” “stirred not shaken”). Unlike stock/stereotypical characters, Rocky and Bond have specific character traits and characteristics that entitle their creators (or owners) to claim copyright in these fictional characters. The more the character has unique, identifiable traits and plays a central role in the work in which the character appears, the stronger the copyright protection permitted by the courts. (If you’ve seen Guardians of the Galaxy, “Rocket Raccoon” is a classic example of a protectible character). Who then, could be more entitled to a “character copyright” than the solitary, tobacco and cocaine-loving, deductive genius-detective Sherlock Holmes, one of the most popular and enduring fictional characters of the last century?* Clearly this character, as conceived by Sir Arthur Conan Doyle in works published between 1887 and 1927 meets this legal standard. *[note] And don’t forget Dr. John H. Watson, who also was almost certainly a copyright-protected character. Today, whatever copyright remains in the 56 stories and 4 novels published by Conan Doyle featuring Sherlock Holmes is owned by the Conan Doyle…

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Know when to hold ’em, know when to fold ’em … (Aereo)

July 22, 2014

It’s difficult to read Aereo’s section of Aereo and ABC’s July 9, 2014 joint letter to the U.S. District Court without experiencing a good dose of disbelief. Until the Supreme Court issued its decision in ABC v. Aereo on June 25, 2014 (earlier blog post on that decision), Aereo insisted that it was not a cable company entitled to a compulsory license under Section 111 of the Copyright Act (17 U.S.C. section 111(c)). Aereo denied it was a cable system in filings with the district court and in its brief to the Supreme Court. At oral argument Justice Sotomayer questioned whether Aereo was a cable company, and Aereo’s attorney responded – Now, we are not a cable service. The reason we’re not a cable service is because cable takes all signals and pushes them down. There’s a head in. It’s defined by statute. There’s a very particularized regulatory structure that deals with taking a lot of content and pushing it down to consumers. Aereo is an equipment provider. However, after the Supreme Court decision Aereo tried to change its stripes. In the July 9th letter it states: The Supreme Court has now ruled that “having considered the details of Aereo’s practices, we find them highly similar to those of the CATV systems in Fortnightly and Teleprompter. And those are activities that the 1976 amendments sought to bring within the scope of the Copyright Act. … Accordingly, Aereo is entitled to a compulsory…

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