Ninth Circuit Clarifies that “Willfully” Means “Willfully”
I think most people know that there is such a thing as criminal copyright infringement, i.e., copyright infringement so heinous that the U.S. government will take time from investigating drug deals to investigate the copyright infringement. How heinous? So heinous that even Jammie Thomas-Rasset, who was found liable for allowing 24 song files to be downloaded via a peer-to-peer network, and was found liable for hundreds of thousands or millions of dollars in damage (depending on which jury you ask)—even she did not do something heinous enough. I mean, it really has be terrible, terrible, terrible. Like, industrial-scale terrible.
Actually, that’s technically an exaggeration (though it’s true as to Thomas-Rasset). As a practical matter, the FBI and U.S. attorneys prefer to expend their limited resources on truly large-scale operations*, the law only has two additional requirements that make garden-variety civil infringement into criminal infringement. First, the act of infringement must be committed “willfully.” Second, it must have an economic motivation.**
* Generally speaking, in criminal law, the trend has been to making more and more things illegal (and increase the punishment), then leave it up to prosecutors and police to decide whether … Read More»
Oh, Those Pesky, Pesky Employees!
From a legal* point of view, hardly anything good ever comes out of the employer-employee relationship**, when you think about it. Wrongful termination suits, reams of paperwork to create a “paper trail” to counter wrongful termination suits, making oral promises the company can’t keep, entering into contracts the company isn’t aware of, getting into accidents in the course of their employment (and making the company liable), and so on and on.
* Of course, hiring is based on need. Nobody ever said, “Oh, I’m really desperate for some help, and there’s lots of it, but I’m afraid of the legal ramifications!” Which isn’t to say there aren’t transaction costs to hiring employees.
** The one exception I could think of: works created by employees in their course of their employment are considered to have been created by the employer. Not that this “work made for hire” doctrine isn’t without controversy.
We can add one more thing to the list: when your employees are using a service that your company provides. Let’s say your company is in the business of hosting and publicly performing uploaded content, which might or might not infringe copyright. And let’s say … Read More»
You bolted up in bed at 3 a.m. last night and grabbed the notepad on your dresser that you keep for just these kinds of occasions, do scribble down the absolutely genius, brilliant, one-of-a-kind, bet-the-company, ineffable NAME that just popped into your head for your new business. The new business idea came to you a couple weeks ago, but you haven’t really done anything else yet because you just couldn’t come up with a name. And now you have it, and it’s perfect.
So how do you protect it?
The sensible instinct is to file an application for trademark protection as soon as possible, to stop anyone else from stealing your name and using it. But we got reminded again today by the Trademark Trial and Appeal Board that applying for trademark registration actually isn’t the first thing you should do.
Trademark rights, which are design to prevent your consumers from being confused by brand names that are too similar, are created when the mark you’ve conceived actually gets used in public. In 1989, Congress added Section 1051(b) to Title 15 of the U.S. Code, changing the law so that trademark applications could be filed before actual use began, but … Read More»
The state of Texas is looking more and more like it’s forgotten that there’s a world outside of itself. Cue the weird article from Time this week that reads like it was written by Rick Perry himself, about how everyone’s moving there, buying hats and being self-reliant in their cheap houses with no income tax.
A slight recanting before I even get started: I love the people of Texas. I have lots of friends there, blah blah blah. But, of course, there was that one girl I met in Austin who told me she went to school “up north,” which, it turns out, meant in Lubbock…..
This attitude, it seems, that everything begins and ends at the state line, has given rise to some trademark cases that to us non-Texans, look pretty aggressive. Trademark law, as we have explained here here here and here, is only secondarily about protecting brand owners from infringing competitors. It is first and foremost a method of protecting the public from confusion over the products they buy and the services they consume. We don’t want two drugs called “Advil,” when one treats headaches and the other treats skin rashes but has … Read More»
On the Importance of Knowing Just Enough
As we all know by now (quick primer here), the DMCA safe harbor is a marvelous, marvelous thing for internet-related system operators—not just YouTube, but any website that interacts much with its users—but that marvelous protection can be lost if you’re not careful. One way to lose it is to have actual or “red-flag” knowledge of infringing activity on the network. The tendency among service providers, therefore—and something of a perverse incentive—is to remain as ignorant as possible of user activities on the system, unless forced to pay attention via a DMCA takedown notice.
Upload, Infringe, Repeat
But, as the recent Hotfile case demonstrates, complete ignorance isn’t good for your DMCA safe harbor. That’s because you have to promulgate and reasonably implement a policy that terminates repeat infringers. The Hotfile court held that implementing a repeat-infringer policy involves collecting some information.
As I’ve explained here, here and especially here, these repeat-infringer requirements raise several difficult questions that have not be adequately addressed by the courts. In Hotfile, the main question was: what is the minimum you have to do to have “reasonably implemented” a repeat-infringer policy? Folded into … Read More»
Yes, if You Hired Someone to Design it for You.
Remember when Second Life was all the rage? I’ll admit that my memory is a little hazy, but I swear it was a huge deal a few years ago. Anyway, it’s still around, with a new slogan: YOUR IMAGINATION, YOUR WORLD.* If you’re not familiar, Second Life is an interactive virtual world that emphasizes the creation of virtual lands, complete with topography, buildings, etc. Subscribers operate avatars that may move through and interact with these worlds.
* Judging from this promotional video: ALSO BOOBS. Seriously.
Subscribers can also purchase virtual land and “terraform” it—i.e., give it mountains, forests, buildings, beaches, caves—to their liking. These lands can be private—i.e., cut off except for those specifically invited—in which case they’re called “islands.”
In this post, I’ll be discussing a recent decision in a lawsuit about whether terraformed virtual “islands” are copyrightable. More practically, the lawsuit is an object-lesson how badly things can go when copyright is involved in what appears to be “just a business transaction.”
Prelude to an Accidental Copyright Dispute
A teacher (we’ll call her the Teacher) working for a particular school district (we’ll call it the District) … Read More»
The Mysteries of Copyright Ownership
If there were a goldmine in your town—one that produced a worthwhile amount of gold every year and wouldn’t run out for many, many years—you’d probably expect any dispute about who owns it to have long since been resolved. It’s true that the folks you sell you real estate might not actually own it, which is why you buy “title insurance,” but real estate transactions are pretty well-recorded, so such awful surprises are pretty rare, which is why anyone would dare to offer “title insurance.” At a minimum, you wouldn’t expect two different people to be mining the gold without, you know, their coming to blows.
But this sort of thing happens with copyrights and royalty streams with surprising frequency. It can be very difficult to tell how owns a copyright. Copyrights can be sold just like real or personal property can, but you don’t need to record the sale anywhere.* True, transfers of copyright have to be in writing, but many industries that deal with copyright—I’m looking right at you, music industry—suck at keeping records.
Jamaica, where, apparently, they didn’t do paperwork in the 1960′s.
Copyright ownership vests initially in the author, or maybe … Read More»
We hardly ever do this at Aaron | Sanders, that is, talk about cases that have just been filed and for which there is no actual judicial opinion yet. We refrain from talking about newly-filed cases for two main reasons: 1) There are too darn many of them and 2) It forces us to end the post by saying something totally lame like “Stay tuned….” But I couldn’t resist this time. For starters, I adore Sherlock Holmes (in no small part because of his recent resurrection in the body of Benedict Cumberbatch, but also because he said it better in A Study in Scarlet than any lawyer ever did: “I listen to their stories, they listen to my comments, and then I pocket my fee.“). But also the copyright issues in the case raise some pretty good questions which will almost certainly come up again, in circumstances that are less clear even than here.
The case of which I speak is currently styled Klinger v. Conan Doyle Estate, Ltd., and is pending in a District Court in Illinois. Leslie Klinger is a well-known expert in “those twin icons of the Victorian era, Dracula and Sherlock Holmes.” … Read More»
BitTorrent Swarm ≠ “Transaction or Occurrence”
I used to blog about BitTorrent lawsuits quite a bit, but dropped that in favor of folks who blogged about them much more comprehensively. But there was one BitTorrent lawsuit that I’ve been following pretty carefully because it’s in Tennessee: Dragon Quest Productions, LLC v. Does 1-100, Case No. 3:12-cv-597. The judge* in that case has just severed the case from one case with 100 defendants, to 100 cases with one defendant each. And that’s pretty significant.
* I’m linking to the magistrate’s “Report and Recommendation,” but the judge accepted it in full.
A quick primer about BitTorrent lawsuits. Usually, the plaintiff is the owner of the copyright in either (a) a pornographic film, or (b) a non-pornographic film that didn’t do so well at the box office.* Dragon Quest LLC is definitely in the latter category, its movie, Age of Dragons, having bombed at the box office, despite somehow starring Danny Glover. In either case, the idea is to settle with as many defendants as possible for what lawyers call “nuisance value,” the amount the defendant is willing to pay to avoid the expense and hassle of … Read More»
We at Aaron | Sanders will be making some big changes to our online presence shortly (and I didn’t want to say that in print until we actually meant it – we’ve been working on the changes for months but it’s really getting close now….) To go along with the rest of the “newness,” we are launching a line of blogs we’re calling “Practical Guidance,” mostly to keep anyone from confusing it with actual legal advice, which of course we’re not giving on the site. This is designed to be useful to our clients and even those of you who don’t hire us, to help you through some of the more common scenarios having to do with corporate matters and intellectual property, and to help you in deciding whether you to need to retain a lawyer or not.
Our inaugural entry is dedicated to software developers and designers, who have lots of questions around getting copyright protection for their programs. The bulk of the information we’re providing you is in the attached PDF, which is yours for the taking and sharing.
What we’re talking about this time is registering code for functional computer programs. As if the information included here … Read More»
Lawyers Sue Too Much, Except When They Don’t
Last week, I discussed the scary court decision, Universal Furniture Int’l, Inc. v. Frankel, in which the owners of a company were found liable for their company’s copyright infringement, even though they were not defendants in the original lawsuit against the company. The copyright owner sued the company and won, and then, when the company filed for bankruptcy, the copyright owner filed a separate suit against the owners. As I explained, if the company is small enough, the owners will be too close the acts of infringement to avoid personal liability. To the court, the only question was whether the copyright owner had to re-prove the copyright infringement. The court held that it didn’t have to because the exact same acts of infringement were involved.
So how does one explain Burberry Ltd. v. Horowitz? In that case, Burberry, the well-known clothing manufacturer, brought an action for trademark infringement against a company called Designers Imports, on grounds that Designers Imports was selling counterfeits of Burberry’s clothing. The court agreed, found Designers Imports liable for $1.5 million, and issued an injunction. Somewhat later, Burberry sued one Asher Horowitz for exactly the … Read More»
Since Aaron & Sanders is in the business of (among other things) helping start-ups get started up, one of the most frequent questions Tara and I get is whether it was worthwhile to incorporate or form some similar corporate entity, such as an LLC. The short answer is it depends on (1) whether you will need to be entering in any scary contracts (i.e., if you breach it, will you be personally devastated?), and (2) how many owners would there be (a single owner is about ten times easier and cheaper to form than two owners, then it get more complex and expensive from there).
It’s well known that corporate entities “protect” the owners somehow, but there is often some confusion about what the owners are protected from. Corporate entities protect against contract liability only, and even then, only if you are clear it’s your company and not you who is forming the contract.* And, only if you have been treating your corporate entity as something separate and apart from you (otherwise, the contract creditor can “pierce the corporate veil” and reach your personal assets).
* I.e., In the part where it says who … Read More»
Did the Ninth Circuit Contradict Itself?
A few days ago, we got two opinions handed down by the same court, written by the same judge, on essentially the same subject, involving the same defendant that reach seemingly contradictory results. On July 31, the Ninth Circuit handed down two decisions about the use of likenesses in video games: Brown v. Electronic Arts, which went defendant’s way, and Keller v. Electronic Arts, which went the plaintiffs’ way.
In both cases, football players sued video-game maker EA for using their likenesses in EA’s football video games. Jim Brown, perhaps the greatest football player ever*, objected to the use of his likeness in EA’s Madden NFL**. In Keller, several former college football players, none of whom will ever be considered one of the greatest of all time, objected to the use of their likenesses in EA’s NCAA Football.
* Before even my time, though.
** EA licenses with the NFL and NFL Players Association for the rights to use players’ likenesses, but Brown has been far too long retired to be covered by those licenses.
These guys might be suing next, when EA comes out with Old-Timey College Football.… Read More»
Common-Sense Decision Is a Trap for the Unwary (and Everyone Else)
A surprisingly fertile field for litigation are “multiple listing services” (MLS) and related real-estate websites. Here’s an MLS for Nashville. The Internet completely inverted the information-relationship between real estate agents and prospective buyers. It used to be that the agents’ main advantage was knowledge of what was for sale, but thanks to MLSs, this information is easily accessible. The very powerful National Association of Realtors jealously guards the trademark rights to MLS (to the extent they even exist)*.
* I know this from personal experience, as I have represented two real estate agents who had the temerity to use MLS in one of their domain names. Did you know that Realtor associations have their own highly complex dispute-resolution and enforcement procedures, completely with their own rules of procedure? I was honestly impressed.
This information is obviously of tremendous value, but protecting it is tricky. Data can’t be protected by copyright. Even if “hot news” is a thing, this data isn’t “hot news.” You can place the data behind a wall, but how is the public supposed to access it? You can place anti-scraping language into your terms of … Read More»
Insert Pun Here: “Dead,” “Requiem,” “Past,” “Woody”
A lot of people breathed a huge sigh of relief when a Mississippi federal judge dismissed (at the pleadings stage) claims for copyright infringement stemming from a paraphrase of a well-known William Faulkner quote in a Woody Allen movie. Then a lot of people scratched their heads at the basis: fair use, not something like de minimis (i.e., too short to be actionable)?
The allegedly infringing quote from the movie, Midnight in Paris, is: “The past is not dead. Actually, it’s not even past. You know you said that? Faulkner, and he was right. And I met him too. I ran into him at a dinner party.”
The quote from the Faulkner novel, Requiem for a Nun, one of the Yoknapatawpha novels*: “The past is never dead. It’s not even past.”
* The judge is clearly a much bigger fan of Faulkner than I am. I tried reading The Sound and the Fury in high school and haven’t been back since.
An Ironic Model: Follow Exxon Because it’s NOT a Constitutional Ruling
Way back in October, I got half-way to proposing a constitutional model for statutory damage awards. More precisely, I got through the part where I reject the two leading models, which happened to have been the competing models in Capitol Records v. Thomas-Rasset—(1) St. Louis, Iron Mtn. & S. Ry. Co. v. Williams and (2) BMW of N. Am., Inc. v. Gore. My starting off point, which you may or may not agree with, is that we have a right to some degree of predictability of the legal consequences of our actions, which is necessary for us to go about our business, and that statutory damages have become out of control and unpredictable.
What I’d like to propose is, ironically, that we avoid the whole constitutional question because the Copyright Act is federal law, and federal law already has a way of dealing with a close cousin (in my opinion) of statutory damages: exemplary damages. It is, thus, the Supreme Court’s opinion in Exxon, not Gore and not Williams*, that governs here.
* Williams governs, too, in that it governs a legislative body’s power … Read More»
Why NPEs Are OMG!
Last time, I explained what patent “trolls”—more politely known as a non-practicing entities or “NPEs”—are and why their business model is such a good one. Mostly they benefit from asymmetrical warfare: a defendant must spend much more money, time and other resources than NPEs, to say nothing of potential liability. Also, the types of patents that NPEs like—broad patents in popular fields with early priority dates—are undervalued and easy to pick up on the cheap. All you need are some good patents and a law firm experienced in enforcing patents willing to take the case on a contingency, and what’s not to like?
Since my main goal is not to condemn (or, for that matter, praise) NPEs, but to explain how got to be where they are, I’m discussing ten patent rules and truisms that make NPEs lucrative. Last time, I discussed three of them: (1) you don’t need to practice the patent to enforce it; (2) you can buy and sell patents like property; and (3) once issued, patents are difficult to invalidate. This time, I’ll discuss the other seven and provide some thoughts about reform (assuming you think reform is a good … Read More»
It’s More Complex Than You Might Think
With several bills pending in Congress and executive action by the current presidential administration, with the accompanying rhetoric, you just might start to wonder about—or maybe have already formed an opinion on—“patent trolls.” The issue is actually fairly complex. While I think some reform is a good idea*, I’m eager (as always) that we not throw babies out with bathwater. So you can make up your own mind, what I thought I’d do is set out the patent laws and principles most important to the phenomena of the “patent troll.”
* Something more nuanced than either “patents suck; they always interfere with innovation” and “patents are awesome; they always lead to innovation.”
The term “patent troll” is a pejorative term that means slightly different things to different people. It could mean:
- Simply any patentee (owner of a patent) that does not practice the invention disclosed in the patent, politely known as a non-practicing entity (“NPE”).
- A patentee that doesn’t practice anything except enforcing the patents it owns, politely known as a “patent holding entity” (“PHE”) or, more positively, a “patent licensing entity.”
- A patentee that not only doesn’t practice the disclosed
Divided Third Circuit Reverses in EA v. Hart
Way back in September 2011, I blogged about Hart v. EA, mostly as an introduction to publicity rights. Hart was a former NCAA quarterback (and former teammate of Ray Rice at Rutgers) whose image (like many other former NCAA players’) is used in EA’s NCAA Football. The NCAA (whose reputation has not gotten any better since then) licenses collegiate athletes’ images and physical statistics to EA, but at the same time forbids collegiate athletes from profiting from their own images.* When you play NCAA Football, you can actually play a simulacrum of Hart—his image and certain physical and football statistics. If you’re a Rutgers alumnus, you might be pretty excited to play Rutgers’ powerful 2006 team (with Hart as quarterback and Rice as tailback) and relive the high-water-mark of Rutgers football.
* I’ll make no secret of my disgust at this state of affairs. Universities are able to profit mightily from young men to risk their health and long-term prospects to play a game they love. A university education is a very valuable thing, and most student-athletes get a great deal, but it’s on the backs of the … Read More»
May 30, 2013 by Rick Sanders | Category: Blawg, Blog | Tags: copyright, digital content, digital distribution, distribution right, file-sharing, internet, making available theory, Menell's Lost Ark, Nimmer
So, I’m talking about this article of mine that was kindly published by the Vanderbilt Journal of Entertainment and Technology Law (“JETLaw”). See part I here. The issue has to do with one of copyright law’s “exclusive rights”—i.e., things only the copyright owner and his or her authorized licensees may do with a copyrighted work—the right to distribute copies of the work to the public, which we’ll just call the “distribution right.” The question is whether the distribution right includes only consummated acts of distribution, or can also include attempts and offers to distribute.* Most (but not all) courts have held that the right is limited to consummated distributions, but rights holders would very much prefer the broader interpretation. The issue used to be academic, but with file-sharing, it matters now because it’s very difficult to detect consummated downloads**, but it’s easy to prove that the unlicensed works were “made available” for download on the file-sharer’s computer.
* Remember that the distribution right has an important exception: the first sale doctrine. Once you legally obtain a physical embodiment of the work, you may dispose of it as you see fit.
** Putting aside what I … Read More»