The cost of a Hendrix covermount

On 20 September 2006 the Sunday Times was distributed with a covermount CD of Jimi Hendrix’s legendary last UK concert at the Albert Hall in 1969. Experience Hendrix (Hendrix’s family’s company) and The Last Experience (the company of Jerry Goldstein, who recorded the concert) successfully asserted title to the band’s performance rights and the copyright in the recordings of the concert in a summary judgment in 2008. The question Sir William Blackburne has decided today is what damages Times Newspapers should pay.

Blackburne J was clear the defendant did have reasonable grounds to know that it was infringing as Experience Hendrix had challenged them prior to publication, though the paper was not recklessly indifferent to the problem – so damages would not be increased by reference to flagrancy or ‘moral prejudice’. Article 13 of the Enforcement Directive (2004/48/EC) sets out different damages regimes depending on the defendant’s knowledge, though it seems unclear that this altered the judge’s calculations.

At the time of the covermount the claimants were themselves intending to release a film of the concert plus accompanying DVD, CD and merchandising. Following the covermount this project was put on hold because (1) the claimants wanted a declaratory judgment that they owned the rights because (a) the rights dispute could scare off their project’s commercial sponsors and (b) the Sunday Times’s ultimate licensor, Charly, could go and do more damage elsewhere and (2) the covermount had spoiled the market for the claimants’ products. The judge was not convinced by the defendant’s arguments that (i) the problem with Charly existed irrespective of the covermount and (ii) the defendants could not be blamed for the effects of the claimants’ decision to suspend their project if that had been misjudged.

The judge held that:

1. If there had been no covermount the claimant’s project could have been launched in July 2007 though given the lack of urgency about the project September was more likely.
2. The delay caused to the claimants by the covermount distribution was one year. The claimants obtained declaratory relief in February 2008 and the spoiling of the market by the covermount was also no obstacle by February 2008 (if indeed the market had been spoiled at all).
3. The claimants could expect to be compensated in relation to the effect on their normal exploitation of the rights (was the claimant in the business of selling copies or licensing rights?). Here the claimants were planning to release a film etc, so those losses should be assessed.
4. The damages could cover economic loss outside the UK in as much as it stemmed from the infringement of UK copyright.
5. Quantum: difficult as the claimants have not yet gone ahead with their project. It was uncertain whether they would make any less money because their project had been delayed.
6. The covermount deprived the defendants of $5.8 million for 12 months.
7. The loss the defendants incurred by having the receipt of this sum delayed would be US base rate + 1% on $5.8 million over one year. That was considerably less than the sum the claimants were looking for.

It's official...

This copyright law enthusiast is officially pleased to be one of the new members of the fabulous 1709 Blog team. In future, I shall endeavour to bring news of the latest developments in German copyright law to an English-speaking audience. Why? Because I believe Lord Goff of Chieveley was clearly on to something when he suggested we “sufficiently dispel our ignorance of German law and so by comparison illuminate our understanding of our own.” (White v Jones [1995] 2 AC 207)

So here we go, diving straight in:

In an interesting recent case, the Regional Court of Cologne (LG Köln) had to decide what constitutes a so-called official work (LG Köln, Urteil vom 07.07.2010 – 28 O 721/09).

It is important to note that English and German copyright law treat public documents quite differently. English court decisions and other public documents are subject to Crown Copyright pursuant to section 163 CDPA 1988, and administered by the Office of Public Sector Information (charmingly abbreviated OPSI). While most Crown Copyright material may be reproduced free of charge, this is subject to certain conditions. For instance, the source of the material must be identified and the copyright status acknowledged. German copyright law, on the other hand, takes the rather more radical approach of completely excluding official works from copyright protection. According to section 5(1) German Copyright Act (UrhG), laws, ordinances, official decrees and notices, as well as decisions and official head notes of decisions shall not enjoy copyright protection.

That certainly seems clear enough, but the case at hand shows that there may be difficulties involved: Claimant was an attorney; defendant operated a website with reports on legal disputes. Claimant, acting for one of his clients, sought a preliminary injunction (PI) against defendant from a court in Berlin. The court granted the PI, stating:

“The preliminary injunction had to be granted for the reasons set out in the attached motion for the preliminary injunction including the appendices thereto.”

Subsequently, defendant published claimant’s brief on his website, as part of an article about his objection proceedings against the PI. Claimant sued for copyright infringement, so the LG Köln had to decide whether in this context the attorney’s brief was part of an official work for the purposes of section 5(1) UrhG.

The court dismissed the claim. It held that an attorney’s brief generally enjoys copyright protection if it achieves a sufficient level of creativity (Schöpfungshöhe), referencing the Bundesgerichtshof’s classic “Attorney’s Brief” decision (BGH GRUR 1986, 739 – Anwaltsschriftsatz). However, if a court refrains from setting out its own grounds to a decision and refers to the contents of an attorney’s brief instead, it thereby appropriates the reasoning contained therein. Consequently, the attorney’s brief becomes part of the decision and thus part of an official work pursuant to section 5(1) UrhG.

The LG Köln appeared to draw additional support for this argument from the fact that claimant’s motion for the PI had actually been physically attached to the decision. It was quick to point out, though, that copyright protected works that become incorporated into official works in the manner described above do not lose their copyright protection outright. They may rather only be used freely to the extent that they are utilised in their capacity as a part of the official work in question.

I believe the court struck a fair balance of interests, given that the publication of the PI would be quite pointless if it were not permitted to publish the motion for the PI as well. Also, I like my PIs super fast and do not think judges should be made to paraphrase the arguments submitted in an attorney’s brief if they happen to agree with them. Do readers feel the same way, or do you think that’s just promoting laziness?

Do you dare to play this game – can you hack it?

You are ‘C’, a.k.a. head of MI6. You are playing a game of evasion, a game where you have no equals. That is, not until now. It’s time, time for you to come face to face with your nemesis . . . ‘Z’.

Go deep into the Copyright, Designs and Patents Act 1988 and there you will find ‘Z’ – a.k.a. ‘the Z sections’.

Yesterday Mr Justice Floyd considered section 296ZD in the summary judgment of Nintendo v Playables. It’s a case that examines the UK’s law regarding circumvention of copyright protection – and whether there’s a difference in the law when it is computer programs that are being copied, or other copyright works.

It all began with a customs seizure of 165,000 devices – devices that are used by those who enjoy playing a game of cat and mouse with Nintendo. Here’s how to play:

1. Illegally download games from the internet (instead of paying £20–£30 per game).
2. Copy games on to illegal device.
3. Slot device into Nintendo DS.
4. DS checks games are genuine – device gives DS the all clear.
5. Play!

Once the judge had resolved concerns about the fact that this uncontested summary judgment application came before him after the parties had partially settled, he easily granted summary judgment finding infringement under ss. 296 and 296ZD.

Sections 296 and 296ZD

These sections outlaw making or selling means for circumventing technological measures that protect copyright. Section 296 applies where the copyright being infringed is in computer programs. Section 296ZD applies where other types of copyright are being targeted.

Floyd J held that s. 296ZD was applicable in this case (as well as s. 296) because ‘although that which is stored on the card is a computer program, the game includes graphic and other works the copying and use of which is controlled by the ETM.’ (Don’t most computer programs involve some copyright material apart from code?)

On the face of it s. 296 requires that the defendant knows the circumventing technology will, at some point, be used to infringe copyright. However, this reading should be questioned as the section implements the Computer Programs Directive, which does not require the defendant to have this knowledge. Under s. 296ZD, by contrast, it’s clearly immaterial whether the defendant (‘C’) knew the device would be used for infringing copyright.

Playables’ export sales

In Sony v Ball, Laddie J held that ss. 296 and 296ZD would not apply where the devices were used abroad. Floyd J went along with this for s. 296 as it applies where the defendant knows devices would be used to make ‘infringing copies’ (i.e. copies that infringe UK copyright). However, the ‘infringing’ language is missing from s. 296ZD, so Floyd J, reluctantly departing from Laddie, held that s. 296ZD would apply to exported devices.

Under this line of reasoning, it would seem that had Parliament correctly implemented EU law, s. 296 might also apply to exported devices….

The judge’s view gives UK law in relation to copyright-protection devices a kind of extra-territorial effect that is not present in normal authorization of copyright infringement (where the copyright infringement that has been authorized must take place in the UK).

Now for a game of s. 16…

Presumably because these devices can be used for playing home-made games, the judgment makes no mention of Playables authorizing copying of Nintendo’s games but there was still some scope for an old-fashioned game of s. 16 copyright.

Playables, it was held, was authorizing the copying of the ‘NLDF’ security code from the device to the DS’s RAM. It isn’t mentioned, but aren’t the devices also sold holding an illicit copy of the NLDF?

When a user puts the device into the console, the DS’s boot-up software is copied into the DS’s RAM. Floyd J was not quite ready to grant summary judgment – it seems because legal Nintendo cards would have the same effect. Surely, however, even though the two copies are identical, one is authorized and the other isn’t?

As for the Nintendo Racetrack Logo, the judge said it was ‘so rudimentary that I consider that it is arguable that copyright does not subsist, particularly as what it is relied on is a modification of a pre-existing work’. Once you’ve experienced the state-of-the-art game of ‘Z’, a game of s. 16 can start to seem a bit basic and old-hat.

Jailbreaking through a pile of bricks

As blogger Jeremy reported here, the U.S. Library of Congress issued a statement on Monday that legalized “jailbreaking” wireless telephone handsets. Jailbreaking is a process of modifying the device’s security software in order to enable interoperability with legally obtained software applications or to connect to an alternative network if the alternative network operator authorizes the connection.

This exemption to the Digital Millennium Copyright Act (DMCA) applies equally to all wireless telephone handsets, their manufacturers and their network operators. However, if the consumer and media frenzy in the past few days are any reflection, it would seem to have been written specifically to address Apple’s iron hold over U.S. users of the iPhone, who are typically required to purchase apps from the Apple App Store and to use only AT&T wireless network service. (Apple lobbied aggressively against this DMCA exemption.) To counter previous instances of jailbreaking, Apple had used its operating system upgrades, which automatically install on active iPhones, to lock any unauthorized software. Locking the unauthorized software essentially rendered the phones as useless as a brick for communication purposes (leading to this tactic being known as “bricking the iPhone”). In addition, Apple warned users that jailbreaking violated and invalidated their warranty, so users could not seek free assistance or services from Apple technicians if the user experienced trouble with their iPhone. Apple claimed these consequences were justified because the jailbreaker had violated copyright law.

Then again, looking at this comparison chart, maybe the iPhone isn't that different from a brick after all....

With jailbreaking now legal under copyright law, will Apple continue bricking phones and refusing to service legally jailbroken phones? Apple has already issued a statement reiterating that jailbreaking invalidates its warranty. And it retains the right to do so under the terms of its warranty and user agreements. But will Apple be able to continue the practice of bricking phones during operating system upgrades? Doing so, it seems to me, punishes users for an action that is now perfectly legal under copyright law. It is one thing to invalidate a warranty and refuse free system services, but quite another to render the product inoperable. If anyone has thoughts on Apple’s bricking policy, please feel free to leave comments below.

And if you’re a U.S. iPhone owner considering a jailbreak, I’ve heard that T-Mobile USA offers technical support (to replace the invalidated Apple warranty) to iPhone owners who subscribe their jailbroken iPhones with T-Mobile service.

Obsolete dongles to become history?

Thanks are due to my friend and fellow blogger Miri Frankel (IP Finance) for drawing my attention to a recent statement by the Librarian Congress relating to classes of works to be exempted from the statutory prohibition under the Digital Millennium Copyright Act (DMCA) against circumventing technological means that prevent access to it. Miri suggests that the two exemptions that will have the biggest impact are likely be (i) the unlocking of phones in order to use otherwise inoperable apps and to use them on other carriers' networks and (ii) circumventing DVD security in order to use materials for educational purposes, comment or criticism. The statement reads thus, in relevant part:

"Statement of the Librarian of Congress Relating to Section 1201 Rulemaking

Section 1201(a)(1) of the copyright law requires that every three years I am to determine whether there are any classes of works that will be subject to exemptions from the statute’s prohibition against circumvention of technology that effectively controls access to a copyrighted work. I make that determination at the conclusion of a rulemaking proceeding conducted by the Register of Copyrights, who makes a recommendation to me. Based on that proceeding and the Register’s recommendation, I am to determine whether the prohibition on circumvention of technological measures that control access to copyrighted works is causing or is likely to cause adverse effects on the ability of users of any particular classes of copyrighted works to make noninfringing uses of those works. The classes of works that I designated in the previous proceeding expire at the end of the current proceeding unless proponents of a class prove their case once again.

This is the fourth time that I have made such a determination. Today I have designated six classes of works. Persons who circumvent access controls in order to engage in noninfringing uses of works in these six classes will not be subject to the statutory prohibition against circumvention.

... it is important to understand the purposes of this rulemaking, as stated in the law, and the role I have in it. This is not a broad evaluation of the successes or failures of the DMCA. The purpose ... is to determine whether current technologies that control access to copyrighted works are diminishing the ability of individuals to use works in lawful, noninfringing ways. The DMCA does not forbid the act of circumventing copy controls, and therefore this rulemaking proceeding is not about technologies that control copying. Nor is this rulemaking about the ability to make or distribute products or services used for purposes of circumventing access controls, which are governed by a different part of section 1201. ...

The six classes of works are:

(1) Motion pictures on DVDs that are lawfully made and acquired and that are protected by the Content Scrambling System when circumvention is accomplished solely in order to accomplish the incorporation of short portions of motion pictures into new works for the purpose of criticism or comment, and where the person engaging in circumvention believes and has reasonable grounds for believing that circumvention is necessary to fulfill the purpose of the use in the following instances: (i) Educational uses by college and university professors and by college and university film and media studies students; (ii) Documentary filmmaking; (iii) Noncommercial videos

(2) Computer programs that enable wireless telephone handsets to execute software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications, when they have been lawfully obtained, with computer programs on the telephone handset.

(3) Computer programs, in the form of firmware or software, that enable used wireless telephone handsets to connect to a wireless telecommunications network, when circumvention is initiated by the owner of the copy of the computer program solely in order to connect to a wireless telecommunications network and access to the network is authorized by the operator of the network.

(4) Video games accessible on personal computers and protected by technological protection measures that control access to lawfully obtained works, when circumvention is accomplished solely for the purpose of good faith testing for, investigating, or correcting security flaws or vulnerabilities, if (i) The information derived from the security testing is used primarily to promote the security of the owner or operator of a computer, computer system, or computer network; and (ii) The information derived from the security testing is used or maintained in a manner that does not facilitate copyright infringement or a violation of applicable law.

(5) Computer programs protected by dongles that prevent access due to malfunction or damage and which are obsolete. A dongle shall be considered obsolete if it is no longer manufactured or if a replacement or repair is no longer reasonably available in the commercial marketplace; and

(6) Literary works distributed in ebook format when all existing ebook editions of the work (including digital text editions made available by authorized entities) contain access controls that prevent the enabling either of the book’s read-aloud function or of screen readers that render the text into a specialized format ..."

My initial scepticism that the US approach to technological circumvention and copyright has somewhat evaporated of late, when I contrast the flexible functionality of the position in the US with the principled paralysis of Europe. Am I alone?

Communication questions: Romania asks the oracle

The Inalta Curte de Casatie si Justitie (Romania) has referred some copyright questions to the Court of Justice of the European Union for preliminary rulings in Case C-283/10 Circ & Variete Globus Bucureşti v Uniunea Compozitorilor şi Muzicologilor din România - Asociaţia pentru Drepturi de Autor - U.C.M.R. - A.D.A. -- yet another case that can't be located on the Curia website. This case regards communication of musical works to the public and collective management under Directive 2001/29 of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. The referring court asks:

"1. Is Article 3(1) of Directive 2001/29 ... to be interpreted to the effect that 'communication to the public' means:

(a) exclusively communication to the public where the public is not present at the place where the communication originates, or
(b) also any other communication of a work which is carried out directly in a place open to the public using any means of public performance or direct presentation of the work?

In the event that point (a) represents the correct meaning, does that mean that the acts, referred to in point (b), by which works are communicated directly to the public do not fall within the scope of that directive or that they do not constitute communication of a work to the public, but rather the public performance of a work, within the meaning of Article 11(1)(i) of the Berne Convention?

2. In the event that point (b) represents the correct meaning, does Article 3(1) of the directive permit Member States to make statutory provision for the compulsory collective management of the right to communicate musical works to the public, irrespective of the means of communication used, even though that right can be and is managed individually by authors, no provision being made for authors to be able to exclude their works from collective management?"

The 1709 Blog received this information from the UK's Intellectual Property Office, which somewhat alarmingly gives us only till tomorrow, 30 July, to email our comments to the Office. Like NIPC's colleague Jane Lambert (who has posted a helpful note here), he's not sure exactly what the background to this is, though it seems that the parties are, respectively, a circus and a rights society. All further information is gratefully received.

The trade mark's a killer for Eugenia Padilla

Copyright is not a subject that often crops up in Community trade mark disputes, but it did here in Case T‑255/08, Eugenia Montero Padilla v Office for Harmonisation in the Internal Market, José María Padilla Requena -- an appeal to the General Court against the refusal of the office that administers the Community trade mark system to block the registration of the JOSE PADILLA trade mark. Essentially what we have here is one good soul named José Padilla trying to register the name JOSE PADILLA as a trade mark, with another lady -- who appears to administer the copyright of her uncle (a composer of that name) -- seeking to stop her.

Eugenia argued first that, if her adversary were allowed to register the mark, she wouldn't be able to gain the benefit of the presumption that a person named as the author of a published work is its author, under Article 5 of the IP Enforcement Directive. She later argued that, since the name "José Padilla" was attached to copies of the composer's copyright-protected works (CDs, DVDs, sheet music etc) sold in the course of trade, that constituted the use of a trade mark which would be able to thwart a later attempt by someone else to register the mark.

The General Court disagreed and dismissed her appeal. The copyright presumptions were a red herring and, even in the unlikely event that an adverse trade mark registration might prevent them, this was not a ground of opposition recognised by Community trade mark law. Also, the existence of a name on a piece of music or a recording was as likely to be an indicator of who was the artist or composer, not an indicator of the trade source of the product in question.

Serious damages

Last week a Russian court ordered the publisher Astrel to pay 7.6 billion rubles (around £160 million) to Terra, another publisher, for copyright infringement. Astrel had published books by Alexander Belyayev, ‘whose novels Amphibian Man and Professor Dowell's Head enjoyed immense popularity in Soviet times and still have a devoted following’ (Moscow Times).

It is not just the titles of the author’s books that is worthy of note, however, but also the method of calculating damages:

Number of copies sold by Astrel x £2400 approx (price of claimant’s luxury six-volume leather-bound edition)

Astrel’s edition sold for around £3.40.

The judgment may be intended to demonstrate Russia’s willingness to take IP enforcement seriously – an issue blocking its entry to the World Trade Organization. But how reassuring will the WTO find this financial methodology?

Software analytics: idea and expression

On Friday Mr Justice Arnold delivered a judgment in the dispute between SAS Institute Inc (a major player in the business analytics software market) and World Programming Ltd. As the judgment sets out:

‘The Defendant, World Programming Ltd ("WPL"), perceived that there would be a market demand for alternative software which would be able to execute application programs written in the SAS Language. WPL therefore created a product called World Programming System or WPS to do this. In developing WPS, WPL sought to emulate much of the functionality of the SAS Components as closely as possible in the sense that, subject to only a few minor exceptions, it tried to ensure that the same inputs would produce the same outputs. This was so as to ensure that WPL's customers' application programs executed in the same manner when run on WPS as on the SAS Components. There is no suggestion that in doing so WPL had access to the source code of the SAS Components or that WPL have copied any of the text of the source code of the SAS Components or that WPL have copied any of the structural design of the source code of the SAS Components.’

In the judge’s view replicating the functionality of the SAS software did not infringe copyright, but WPL’s manuals did – though you would expect the manuals to bear some resemblance to the SAS manuals there was a degree of similarity in the language that went beyond the inevitable.

This is not the end of the story, however. The judge’s views are conditional. He is first seeking guidance from the ECJ on the interpretation of the Software Directive. The key issues are whether programming languages, interfaces and functions are protectable by copyright. All the questions revolve around the fundamental copyright principle that ideas are not protected, only the expression of ideas. Here’s a rough expression of the ideas underlying the judge’s questions:

Programming languages: are they idea or expression?

Interfaces: the Software Directive makes some concessions for the fact that computer programs need to interface with each other. But are interfaces completely unprotected by copyright?

Functions: copyright may protect not just the software’s source code but also its design. To what extent can software be eligible for the type of copyright protection that is extended to the plot of a novel? How far can functionality be equated with design/organization?

Smoking pipes and other copyright tales

To the USA first, where the Recording Industry Association of America (RIAA) have announced that they will appeal a federal judge's reduction of a file-sharing copyright damages award from $675,000 to $67,500 in the Joel Tenenbaum case. The original award ordered the Boston University student to pay $675,000 in copyright infringement damages for sharing 30 songs online. Earlier this month, U.S. District Judge Nancy Gertner ruled that amount unconstitutionally excessive, and reduced it by 90%. Similarly the copyright infringement damages award of $1.92 million that a jury ordered defendant Jammie Thomas-Rassett to pay has been reduced $54,000, although that case appears headed for a new trial on the issue of damages.

An to Germany for another turnaround: In Dusseldorf the appellate court has overturned a lower court's order that free file-hosting service Rapidshare must install a keyword filter to block the sharing of copyrighted media. The lower court issued a preliminary injunction against Rapidshare last year, after film distributor Capelight Pictures sued the site when copies of its "Insomnia" and "Inside a Skinhead" movies were made available for download from the service. The lower court ordered Rapidshare to filter words such as "insomnia" and "skinhead". The Higher Regional Court of Dusseldorf has now ruled that more advanced filter that used full film titles cannot be used - noting that the words could wrongfully remove users' private copies of the films, which are permitted under German law. The court also said Rapidshare is not obligated to pursue those who distribute links to unauthorized files hosted on it service.

Finally to Eire where Irish ISP UPC has said that it will continue to “vigorously” defend itself against liability proceedings taken against it in the Eire's courts by content owners. The company is the latest in a series of ISPs to take issue with copyright holders' insistence that they police customers' Internet traffic. Ireland's biggest ISP, Eircom, was successfully taken to court by the IRMA (Irish Recorded Music Association) and is currently sending warning letters to customers who have allegedly infringed copyright through illegal downloading using the IP addresses of alleged infringing customers which are supplied by IRMA. UPC said that it does not condone piracy, but considers that "there is no basis under Irish or European law requiring an ISP to monitor or block subscriber traffic on its network" – although in France and the United Kingdom there are the new, and much criticised, "three strikes" laws – the French HADOPI law and the Digital Economy Act in the UK – the French law has already faced legal challenge and as previouslt reported, the UK law is about to face a judicial review.

http://www.zeropaid.com/news/90025/riaa-appeals-reduction-of-tenenbaum-p2p-judgment/
http://arstechnica.com/tech-policy/news/2010/07/german-court-overturns-injunction-against-rapidshare.ars
http://www.pcworld.com/businesscenter/article/201767/isps_battle_against_threestrikes_rule_throughout_eu.html

Copyright: a help or hindrance?

"Driving UK Research – Is copyright a help or a hindrance?" is the title of a new report from what is termed "the research community", compiled by the British Library. It examines the UK’s existing intellectual property framework, "reflecting the challenges researchers face on a daily basis and highlighting a consensus across all sectors on the need for reform to meet the demands of a modernising world". According to the media release yesterday,

"Sourced directly from researchers this report presents a ‘grassroots view’ of the current copyright framework in the UK. Looking at the barriers they encounter on a daily basis, the contributors’ feedback not only highlights the obstructions to creativity but also puts forward proposals for reforming UK intellectual property legislation to reflect the needs of today’s researcher.

Dame Lynne Brindley, Chief Executive of the British Library, [says]:
“Underpinning research in the UK, the British Library presents this report on behalf of the research community, raising their thoughts and ideas on how to create a copyright system fit for the future. We hope it will provide a useful contribution to the debate.”

You can read it here. It's 19 pages long and, despite its brevity, covers quite a broad range of issues. My impression is that this set of mini-essays represents the view of the high end of the research community, the respectable zone in which researchers are sufficiently attentive to the impact of copyright law to want (i) to avoid infringing it and (ii) to change it where possible to bring its provisions more closely into accord with modern research techniques and computer-driven facilities. The low end of the research community just gets its head down and carries on researching on the assumption that -- with the exception of gaining access to necessary sources and materials -- copyright is no problem because it can be safely ignored.

Rightslink gets an upgrade

It really is a busy time of year for online rights and licensing enthusiasts. Only yesterday we tasted the pineapple with Eric E. Johnson's konomark -- which got a bit of a thumbs-down from our readers -- and Creative Commons issues are never far from the surface of our consciousness, particularly now that we have the uncommonly creative Aurelia in our blogging team. Now it's the turn of the Copyright Clearance Center, which has announced the upgrade of its online licensing tool Rightslink: this lets content users obtain instant gratification in their quest for reprint and permission services by going directly to publishers’ websites. According to CCC,

"The new version of Rightslink includes new features that make it easier for publishers to provide their users with the ability to obtain reprints through their respective sites. Rightslink customer emails have also been upgraded to a new look and optimized functionality. In addition, Rightslink also allows users to obtain reprint permissions “on the go” via the iPad, Nook and other mobile devices that support JavaScript. With knowledge professionals consuming content on evolving digital formats and publications creatively exploring new business models that include the iPad and other mobile devices, Rightslink makes it possible for publishers to monetize content wherever it is displayed".

So now you know. If readers have any pensées on the issues arising, or on Rightslink itself, I hope they will share them with us.

Reclaiming the Rights that are Left - Corrected

Note on Corrections: Yesterday, I posted about jazz musician Frank Foster’s reclaiming of his copyright in the song “Shiny Stockings”.  But, I cited and applied the wrong law, Section 203 of the US Copyright Act instead of Section 304.  Section 203 applies to rights transferred after 1977, not before 1978 as I had stated.  A very nice gentleman at the US Copyright Office was kind enough to bring this to my attention.  The corrected post is below.

-----------------------------

There’s a great story over at Jazz Corner about an artist protecting his rights under the US Copyright Act.  Often, criticisms of serving big companies and leaving the artists out in the cold are leveled at the Copyright Act, so it’s nice to see an occasion where the Act is working positively for the artist.

The Artist

Jazz Corner’s report does a nice job of covering the humanitarian side of the story.  I’ll offer a short summary here, but suggest you read the piece there for more information.  Saxophonist Frank Foster wrote a very popular jazz tune called “Shiny Stockings.”   And like many other musicians, he signed away the rights to the song without really knowing what he was giving up. (NPR story on that issue here.)  But now, he is going to get his royalties with the help of the Community Law Clinic at Rutgers Law School.  [A demo of the film documenting Foster’s story can be found here.]

The Work

When “Shiny Stockings” was penned in the mid-1950s, it was covered under the 1909 US Copyright Act.  This Act provided copyright protection for a term of 28 years, with an option to renew for another 28 years.  Before the first term could expire on “Shiny Stockings”, a new copyright act came into effect.  The US Copyright Act of 1976.

The Law

The 1976 US Copyright Act made a number of substantial changes to the US copyright law. As such, the new act needed to provide for a variety of different situations, including protection of existing non-published works, works that had already been renewed once and works that were in their first copyright period under the 1909 Act.  Section 304(c) provides a special protection for artists whose works fall under the second two categories. 

Since the 1909 Act provided for two 28 year terms (with renewal), authors could transfer or license their rights for up to 56 years, the entire possible term of the copyright.  The 1976 Act added extra years to the copyright term, years the authors didn’t know they would have when they transferred away their rights.  So, the 1976 Act provided a way for authors to reclaim the extra years. 

Under Section 304(c), authors who transferred their rights in a work prior to 1978 have an opportunity to take back their rights after the end of the term they thought they were giving away.  The window for this opportunity opens at 56 years after the original copyright date and stays open for five years.  Sort of.  The author has five years within which to terminate the original grant, but the author has to give the grantee two-years written notice.  (Notice must also be given to the Copyright Office before the termination occurs.)  Then, of course there’s another catch that makes the math more complicated.  The notice can be sent out as early as ten years before the termination date picked by the author.  So what the author actually winds up with is something like this: (click to view full scale)

“Shiny Shoes,” which was first copyrighted in 1956, so Foster could have requested transfer anywhere from 2012 to 2017.  Once the transfer is effective, Foster will have all the rights which the original transfer had given away, until the end of the work’s copyright term.  For “Shiny Shoes” that full term is 95 years, until 2051.*  Foster and his heirs will get roughly forty years of copyright royalties that the otherwise wouldn’t have received.  Not bad.

 

*The nice gentleman that send the correction also provided information that “Shiny Shoes” was renewed for its second copyright term in 1984, making it eligible for the 95 year full term under the Sony Bono Copyright Term Extension Act.  See Section 304(b).

Again, my sincere thanks to the gentleman for his note, and my apologies to The 1709 Blog readers for the incorrect information in the previous post.

Reclaiming the Rights that are Left

The author has temporarily removed this post to fix some critical errors. Thank you to Mr. David Carson for kindly pointing these out.

The Pirates launch a ghost ship

Well, in yet another twist in the ongoing saga of The Pirtate Bay, it seems the political 'wing' of the 'movement' has a new wheeze. Having had a number of court judgments ordering ISPs to block access to the rogue bit-torrent tracker site and/or give up details of users who infringe, now we have an all new gleaming pipe that allows anyone to connect with anything - courtesy of - ahem (and drum roll pelase) THE PIRATE BAY!

The Inquirer describe the new service thus "The Pirate Party has created an ISP, dubbed PirateISP, based in the Southern [Swedish] city of Lund, a place well known for its 42,000 academic community, and will provide high speed internet connections to the anonymity seeking masses". The new service appears to undercut local rivals by about 50%.

PSFK says this "the Pirate Party looks to refashion Internet privacy regulations by starting an anonymity-based ISP. By cloaking online activities, the progressive group aims to advance their political mission to ensure that citizens’ rights to privacy are respected. Henrik Pontén, the Swedish Anti-Piracy Bureau agent who led the raid against The Pirate Bay, indicated that police requests for Internet activities from ISPs must be lawfully fulfilled. However, Pirate Party’s ISP intends to keep no logs of online activities to give out" adding "By [the] summer’s end the world will be closely monitoring Sweden’s privacy debacle.

http://www.theinquirer.net/

The future: does it exist for copyright?

Back on 7 July 2010, in the comfy environment of Hogan Lovells' London office, Professor Lionel Bently addressed the AIPPI UK on "The Future of Copyright Law". Starting with the controversial proposition that the title assumed that copyright did indeed have a future and asserting that the legitimacy of copyright was also a fit and proper subject for academic study, Lionel posed three visions to consider: (i) judicial deepening of harmonisation in the ECJ; (ii) further piecemeal legislation from the EU; and (iii) a European copyright code and unitary European copyright.

If you want to know what Lionel said, there's a helpful and well-drafted four-page summary here.

The konomark: will it sink or swim?

Discovered on Eric E Johnson's website is news of the konomark, "a new way to be friendly with your intellectual property". As Eric explains:

"The konomark is a symbol – a circle with a pineapple in it – that lets visitors to your website know that you are generally willing to share your copyrighted content, such as photos, educational materials, music, etc., with folks like yourself, for free. The konomark is an invitation to e-mail you and ask you for permission.

Let’s say I see a konomarked photo that I want to use. What should I do?
Just e-mail the photographer, explain how you want to use it, and wait for a response. You won’t be bothering anyone – the photographer has invited you to ask. It’s all good.

Who is allowed to use the konomark?
You are, as long as you comply with the following three rules:
• You use the konomark only to mark your own copyrighted works.
• By konomarking a copyrighted work, you intend to invite people to ask you for permission to use that work.
• You are generally amenable to letting people use, without compensating you, the copyrighted content you’ve konomarked – even though the konomark does not legally obligate you.

Technically, legally speaking, these three rules are the conditions upon which you are granted a revocable license to use the konomark logo and word mark. Just be aware that the rules are subject to change – after all, the konomark project is new, and still in an experimental stage ...".

I've not spotted any konomarks in general use up to now, and the relatively small number of Google 'hits' for the word (c.5,300) leads me to suspect that it's not yet about to oust the rather more complicated Creative Commons from its roost. Still, I shall be keeping my eye out (to mix my metaphors) to see whether the little black pineapples sink or swim: will they take root in the fertile soil of enthusiastic cooperation or wither on the vine of indifference?

Film-makers' rights: another ECJ reference

Earlier today this weblog reported on another copyright dispute in which a question has been referred to the Court of Justice of the European Union for a preliminary ruling -- the question relating to payments for public lending right. Now, courtesy of the UK's Intellectual Property Office, here's news of another reference, this time from Austria in C-277/10 Luksan v Petrus van der Let (not yet available on the Curia website). The questions asked are as follows:

"1. Must the provisions of European Union law concerning copyright and related rights, and in particular Article 2(2), (5) and (6) of Directive 92/100, Article 1(5) of Directive 93/83 and Article 2( 1) of Directive 93/98, in conjunction with Article 4 of Directive 92/100, Article 2 of Directive 93/83 and Articles 2 and 3 and Article 5(2)(b) of Directive 2001/29, be interpreted as meaning that the principal director of a cinematographic or audiovisual work or other authors of films designated by the legislatures of the Member States are directly (primarily) entitled in all events, by law, to the exploitation rights in respect of reproduction, satellite broadcasting and other communication to the public through the making available to the public and that the film-maker is not entitled thereto directly (primarily) and exclusively;

Are laws of the Member States which assign the exploitation rights by law directly (primarily) and exclusively to the film-maker inconsistent with European Union law?

If the answer to Question 1 is in the affirmative:

2a. Does European Union law grant the legislatures of the Member States the option of providing for a legal presumption in favour of a transfer to the filmmaker of the exploitation rights within the meaning of paragraph 1 to which the principal director of a cinematographic or audiovisual work or other authors of films designated by the legislatures of the Member States are entitled, even in respect of rights other than rental and lending rights, and if so, must the conditions laid down in Article 2(5) and (6) of Directive 92/100, in conjunction with Article 4 of that directive, be satisfied?

2b. Must the primary ownership of rights of the principal director of a cinematographic or audiovisual work, or of other authors of films designated by the legislature of a Member State also be applied to the rights granted by the legislature of a Member State to equitable remuneration, such as 'empty cassette remuneration' pursuant to Paragraph 42b of the Austrian Urhebergesetz (Copyright law, 'UrhG'), or to rights to fair compensation within the meaning of Article 5(2)(b) of Directive 2001/29?

If the answer to Question 2b is in the affirmative:

3. Does European Union law grant the legislatures of the Member States the option of providing for a legal presumption in favour of a transfer to the filmmaker of the rights to remuneration within the meaning of paragraph 2 to which the principal director of a cinematographic or audiovisual work or other authors of films designated by the legislatures of the Member States are entitled, and if so, must the conditions laid down in Article 2(5) and (6) of Directive 92/100, III conjunction with Article 4 of that directive, be satisfied?

If the answer to Question 3 is in the affirmative:

4. If a legal provision of a Member State accords to the principal director of a cinematographic or audiovisual work or other authors of films designated by the legislatures of the Member States a right to half of the statutory rights to remuneration, but provides that that right is capable of alteration and not therefore unwaivable, is that provision consistent with the aforementioned provisions of European Union law in the area of copyright and related rights?"

If you would like to comment on this case please email the IPO here before this Friday, 23 July 2010.

If any reader has any background information concerning this reference and the underlying dispute, we'd be delighted to hear of it.

Something to read this summer

A few weeks ago I wrote on this weblog that there was a new copyright book just coming out -- Privilege and Property. Essays on the History of Copyright, edited by Ronan Deazley, Martin Kretschmer and Lionel Bently. Delightfully, it comes in hardback, paperback and digital download formats and, if you don't want to buy it, you can still read it online free of charge, here. The good news is that the book is now out, and you can get all the relevant information about it from Open Book Publishers here.

Meanwhile, SABIP -- the UK's Strategic Advisory Board on Intellectual Property Policy -- reminds us that, in February 2010, it organised a policy panel debate to discuss the issues raised by the proposed Google Books settlement. The good news is that a report of proceedings, along with SABIP's own policy recommendations, was published online last Friday and is now available to download here. Also available from the same source is a report, "Attitudes and Behaviours of Consumers in the Digital Age", which you can download here.

Public lending, flat rate: now a reference

Via the UK Intellectual Property Office website comes information concerning a further copyright-related reference of a question to the Court of Justice for a preliminary ruling. This is Case C-271/10 Cvba Vereniging van Educatieve en Wetenschappelijke Auteurs v Belgische Staat. The question referred is as follows:

"Does Article 5(1) of Council Directive 92/100 ... on rental right and lending right and on certain rights related to copyright in the field of intellectual property, now Article 6(1) of Directive 2006/115 ... rental right and lending right and on certain rights related to copyright in the field of intellectual property, according to which at least authors should obtain a remuneration for public lending, preclude a national provision which sets the remuneration at a flat rate of EUR 1 per adult per year and of EUR 0.5 per minor per year?"

I've not been able to find any information on this reference on the Curia website. Can any readers give me some background?

Record industry mocked again as the cost of fan actions are made public

The Recording Industry Association of America's 2008 finances have been published with the revelation that the major labels trade body paid out over $17 million to the three legal firms who spearheaded the organisation's legal actions against file sharing fans. In return, they recovered $391,000 in damages. On his Recording Industry vs The People blog, Ray Beckerman analysed the same figures for 2006 and 2007 and claims that the trade body spent a total of $64,000,000 on legal and investigation firms involved in their “sue-the-fans” campaign during those three years, and these cases brought in a total of $1,361,000 in damages. The RIAA eventually dropped the strategy of suing individual fan after years of costly failures, bad publicity and widespread criticism of high profile cases against defendants such as Joel Tenenbaum and Jammie Thomas-Rasset. In the same year, the RIAA’s chief executive Mitch Bainwol was paid just over $2 million in salary ($1.9 million) and benefits ($123,000). President Cary Sherman was paid $1.33 million, Neil Turkewitz (EVP, International) was paid $696,000, Mitch Glazier (EVP, Government & Industry Relations), pulled in $566,000 and Steven Marks (EVP & General Counsel) received $562,000.

The funny side of intellectual property

If one comedian nicks another comedian’s material, do they go to court? No. Instead they try talking it out. If that fails, the aggrieved stand-up bad-mouths the other, gets him banned from clubs, refuses to work on the same bill – or possibly thumps him.

Comedians’ unwritten copyright code differs in various ways from copyright law, as Dotan Oliar and Christopher Sprigman explain in their paper ‘Intellectual Property Norms in Stand-up Comedy’. It protects ideas, not just their expression, and if a comic establishes the premise of a joke, then he gets to own others’ contributions to it. Generally, the rules are simpler than legal copyright, so there’s no room for doubt when a rule-breaker is breaking the rules.

This social norm is relatively new apparently: in the vaudeville era it was acceptable to appropriate others’ jokes. Oliar and Sprigman suggest two reasons for the change. Firstly the mass media has created new incentives to create and protect original material. ‘If a comedian-thief lifted a joke off the vaudeville stage and told it traveling east, the originator could still use it traveling west. Today, if a joke thief tells a joke on radio or television or if an audience member posts it to a heavily trafficked Web site, it may consume the national market for the joke.’ Secondly, from the 1950s many comedians developed a more individualistic, narrative style. The more clearly original the material, the more practically feasible enforcement becomes. Oliar and Sprigman then ask whether the development of an informal IP system has reinforced the stylistic shift.

Can we draw general IP lessons from the comedy circuit? Caution is advisable as this code is operating in a close-knit community of people who already stake their reputations on their originality.

So what’s the least you can expect if you go round stealing punch lines? A short sentence.

A kind of magic? Tenenbaum damages shrunk by 90%

US District Judge Nancy Gertner has slashed the federal jury award made against convicted file sharer Joel Tenenbaum by 90 percent, ruling that the award of $22,250 per infringed work could not withstand scrutiny under the Due Process Clause and was “unconstitutionally excessive’’ in light of what she described as the modest harm caused to the record labels whose works were infringed. She cut the award to from $675,000 to $67,500, one-tenth of the original sum. Judge Gertner said

“There is no question that this reduced award is still severe, even harsh .... It not only adequately compensates the plaintiffs for the relatively minor harm that Tenenbaum caused them; it sends a strong message that those who exploit peer-to-peer networks to unlawfully download and distribute copyrighted works run the risk of incurring substantial damages awards.’’

Judge Gertner’s maths to get to a figure of $22,250 damages for each act of infringement went like this

- statutory damages must bear a reasonable relationship to the actual damages
- the actual damage sustained by plaintiffs was no more than $30
- the benefit to the defendant was in the neighborhood of $1500
- it was permissible to treble the minimum statutory damages due to defendant's wilfulness

However the Boston Globe reports that the Judge Gertner believes that reduction also sends an equally important message that the constitutional protection against grossly excessive punitive awards in civil suits protects not only big corporations but “ordinary people like Joel Tenenbaum’’. Congress, she said, never envisioned that the Digital Theft Deterrence Act of 1999 would expose people like Tenenbaum to huge statutory damages for violating copyright law through illegal file sharing.

The major label’s trade body, Recording Industry Association of America (RIAA) issued a statement saying, “With this decision, the court has substituted its judgment for that of 10 jurors as well as Congress’’ saying that it would “contest this ruling’’.

Judge Gertner’s decision to reduce jury damages mirrors that in the case against Minnesota single mum, Jammie Thomas-Rasset who faced a jury award of $1.9 million. Earlier this year, the judge in that case reduced a jury award of $1.9 million in favour of the recorded music industry to $54,000 in her second trial, and the industry offered to settle the case with her for $25,000. However, Thomas-Rasset rejected the settlement, and the case is now poised to go to trial for a third time. Whether Tenenbaum decides to appeal is open – his lawyer, Havard law professor Charles Nesson said he is inclined to appeal the $67,500 award as still unconstitutionally excessive to the First Circuit Court of Appeals but must speak first with his client. Tenenbaum to reporters he had not read the decision and whilst he welcomed any reduction but he could not afford $67,500 either.

http://beckermanlegal.com/pdf/?file=/Lawyer_Copyright_Internet_Law/sony_tenenbaum_100709Decision.pdf
http://www.boston.com/news/local/massachusetts/articles/2010/07/10/file_sharing_damages_reduced_tenfold/
and lots of interesting comments here in the blogsphere http://recordingindustryvspeople.blogspot.com/2010/07/675000-verdict-reduced-to-67500-in-sony.html

And see 'A copyright ruling no one can like' at http://news.cnet.com/8301-31001_3-20010428-261.html

Copyright and contract

SABIP, the UK's Strategic Advisory Board for Intellectual Property Policy, published a report entitled "The Relationship Between Copyright and Contract Law" at the end of last week. This report, prepared by Estelle Derclaye, Martin Kretschmer, Marcella Favale and Richard Watt, is available online -- so there's no excuse for not reading it. The executive summary, a trim 20 pages of which many are blank or sparsely populated by text, can be accessed here, while the full report (a hefty 180 pages) lives here. The report was presented to a number of stakeholders at a workshop in March 2010, the proceedings of which you can peruse at your leisure here. Estelle Derclaye has indicated that she'll be pleased to answer any questions and address any pertinent comments. You can email her here.

By sheer coincidence I received a copy of another work on the same topic, Copyright, Contracts, Creators: New Media, New Rules, this week. The author is Giuseppina D'Agostino and the publisher is Edward Elgar. Giuseppina, Associate Professor in Canada's prestigious Osgoode Hall Law School, York University, is also the founding director of IP Osgoode. According to the book's publishers,

"The digital world has put content within arm’s reach of desire [What a lovely metaphor! Even though most digital content is undesirable to most internet users, the subjective element of one's own desire, reified in the content of one's choice, is rare further than a handful of clicks away]. No longer can an author be satisfied that her intellectual property is safely encased in a bound book, nor can a photographer know where his work will be displayed or shared, nor can a writer rest assured that her article will be consumed in the intended magazine or newspaper [It must be assumed that no content carrier or publisher has been resting assured for some while now]. The Internet-fueled recycling of existing works into new media is the greatest challenge to copyright law.

Copyright, Contracts, Creators evaluates the efficacy of current copyright law to address the contracting and use of creative works. It looks in particular at freelance works and argues that their copyright treatment on a national and international level is inadequate to resolve ambiguities in the contracting and uses of the work. Giuseppina D’Agostino discusses how historically laws and courts were more sympathetic to creators, and how the Internet revolution has shifted the scales to favor owners [a controversial position, which may depend on one's sectoral standpoint as well as the type of work created]. Consequently, creators often find themselves at opposing ends with copyright owners, and in a disproportionately weaker bargaining position that places tremendous strain on their livelihoods. She argues that this predicament puts society at risk of losing its most valued asset: professional creators. The author calls for a new framework to justify legislative provisions and resolve ambiguities while suggesting principles and mechanisms to address the inadequate treatment of freelance work ...".

This is a refreshing and challenging approach to a subject which has attracted relatively little systematic research and where both case law and commercial practice have had a substantially ad-hoc feel about them. It also provides ammunition that may be said to support both sides in the sporadic debate as to whether freelance creators benefit more from the freedom of the little-regulated marketplace as in common law countries or from the more moral and norm-driven approach of continental Europe. Definitely worth a good read.

Bibliographic data: xviii + 320 pages. Hardback. ISBN 978 1 84720 106 5. Price £79.95 (with online discount from the publisher £ 71.96).

BT and TalkTalk take on the DEA

British ISPs Talk Talk and BT have asked the High Court for a Judicial Review to clarify the legality of the country's recently passed Digital Economy Act, which includes provisions requiring ISPs to police file-sharing and which introduces the much debated ‘Three Strikes’ procedure which ultimately may result in subscribers who indulge in illegal file sharing or other infringing activities having their bandwidth reduced or even their internet connection terminated.

The ISPs say the law was "rushed through" with "insufficient scrutiny” and they are asking the Court to clarify whether the U.K. law conflicts with Europe's e-commerce directive, which limits liability of offences committed by ISP subscribers, giving protection similar to the "safe harbour" provisions of the U.S. Digital Millennium Copyright Act. TalkTalk boss Charlie Dunstone told reporters: "We think the previous government's rushed approach resulted in flawed legislation. That's why we need a judicial review

The two ISPs also believe the provisions of the Act that require ISPs to disconnect repeat file-swappers unfairly target larger ISPs, as they only apply to firms with more than 400,000 subscribers with Andrew Heaney from TalkTalk saying “It means we could have huge swathes of customers moving to smaller ISPs to avoid detection.”

It will be interesting to see if this all ends up with a reference to the European Court of Justice on one more more of the points of law raised. In the 2008 case of Promusicae v Telefonica, the ECJ said that it was up to national courts to perform the balancing act of protecting both copyrights and in this case privacy rights. And here the ECJ was ruling on whether, under European law, there was any obligation on ISPs to reveal the identities of suspected file-sharers.

TalkTalk have been vocal in their opposition to three strikes but BT are newer to the fray: BT's Industry Policy Director Simon Milner said yesterday that "every film downloaded from The Pirate Bay or the dozens of other sites offering unlicensed content is a lost sale for BT Vision", but added that when it came to the wider issue of online copyright protection "this is their [the copyright owners'] business: it's up to them to find a solution to their business problems, it's not principally our problem".

UK Media regulator OfCom is currently consulting key interest groups on how a three-strikes might work under the provisions of the DEA.

Young Guns Go For It

On Thursday Night (8th July) Berwin Leighton Paisner kindly hosted one of the regular bi-monthly BLACA meetings (British Literary and Artistic Copyright Association) and this one had a particular twist – the topic was copyright but seen through the eyes of two young copyright professionals, the joint winners of BLACA’s 2010 competition, the prize being the chance to make this presentation!

Chaired by Professor Alison Firth (University of Surrey), the first presentation was from Mark Smith, a newly qualified solicitor at Osborne Clark, and was simply titled “Copyright in the Digital Age”. I won’t dwell on the detail as this and the following presentation will both be available soon on BLACA’s website at http://www.blaca.org/ . Suffice to say, they are both well worth a read and Mark gave a professional speech in a wide ranging presentation. The second presentation was by Ed Cameron , who comes from a science background and has just completed a MSc in the Management of Intellectual Property at Queen Mary College, University of London. Ed focussed on the Digital Economy Act in a presentation titled “The Digital Economy Act - are ISPs under Attack?”. This Blogger has to admit he has not really looked at the finer details of the enforcement provisions of the DEA (particularly those referred to as the ‘three strikes’ system), and Ed did, where there was clarity in the Act, makes some sense of what look like rather complicated enforcement provisions. As with Mark’s presentation, read the detail online.

The sometimes challenging question and answer session was deftly handled by Prof. Firth and a recurring theme was the role of the collection societies in new business models, along with the need to educate the consumer and some comment on the failure of domestic and even the pan-European copyright regimes to provide effective enforcement tools for content owners in the global digital age. I have to say I thought both of the speakers did really well – a brave challenge for two young men who were students this time last year – faced with a room that included some well seasoned copyright lawyers ..... and a few less seasoned ones as well!

Details on this year's BLACA prize can be found at http://www.blaca.org/prize.htm

Jurisdictional tactics: Penguin v American Buddha

Sometimes it seems as if the internet transcends physical space. But no – it’s just in a lot of different places. Consequently when copyright is infringed online, claimants may find they are faced with a choice of where to sue.

American Buddha operates free online ‘libraries’: Penguin USA say four of their titles have been made available to these libraries’ members without authorization. Penguin has sued, but not in Arizona, where American Buddha are based – in New York. At first instance, American Buddha successfully challenged the jurisdiction of the NY district court but Penguin appealed to the Second Circuit Court of Appeals. They in turn are now referring the question to the New York Court of Appeals... Why hasn’t Penguin sued in Arizona? Perhaps because the copyright jurisprudence of the Second Circuit is more predictable and favourable to right owners than that of the Ninth.

New York state law allows jurisdiction over an out-of-state party who commits a tort in the state, or commits a tort outside the state that causes injury within NY. Penguin is not pursuing the first of these. The district court said Penguin ‘appears to recognize that “in the case of web sites displaying infringing material the tort is deemed to be committed where the web site is created and/or maintained” ’ – a take on international copyright law that is not shared in all corners of the world.

Instead, Penguin wants to argue that American Buddha’s infringements outside the state have caused them harm within NY. The question for the court is: if the alleged copyright infringements cause injury to Penguin, where does that injury take place? The district court believed the injury would be where the infringement occurred – i.e. American Buddha’s servers.

To prove that American Buddha’s alleged copyright infringement had caused injury within NY, Penguin might perhaps have argued that American Buddha had caused a loss of customers in Manhattan. Penguin, however, seems to be focusing on a different kind of injury. The argument is that the infringements cause harm to their copyrights, which are held in New York. This reasoning relies on the notion that copyrights have a physical location for jurisdictional purposes.

Why would Penguin pursue this philosophically challenging line of attack? Presumably the damages obtainable in relation to harm to the copyrights generally could apply to loss of sales anywhere, not just those in the Big Apple? The discerning internet forum shopper is on the lookout for a jurisdiction where he can mop up all the disparate infringements in one go. Usually that would mean suing the defendant where he is resident but could this be another way?

From Papers to Plaques

It’s one of the proudest moments of your life.  You sit down to breakfast, open the newspaper and there she is, your daughter looking back at you from the page, smiling proudly with her award in hand.  Being a doting parent, you want to give her something special by which to remember this achievement and show her how proud you are.  A quick search online and you find the perfect gift, that article, bright and shiny on a special plaque from That’s Great News!

Seems like a great business idea, but it’s almost exactly what’s gotten That’s Great News into some trouble with a news company called GateHouse Media.  The only difference, the news clippings came from an online news site rather than a paper one.

Evan Brown over at Internet Cases has brought to our attention this new case in the US involving the infringement of Creative Commons licensed materials from one of GateHouse’s websites.  Filed last Wednesday in the Northern District of Illinois (the area that includes Chicago) the complaint lists claims of copyright and trademark infringement, unfair competition and breach of contract.  (Evan’s post questions why GateHouse chose to file a breach of contract claim.  If you are interested in this discussion, see the comment section of his post.) 

Without being able to see the complaint, we can only speculate about GateHouse’s arguments.  The material that GateHouse claims Thats’ Great News! infringed was licensed under a CC NonCommercial NoDerivs license (BY-NC-ND).  So we might suppose that GateHouse will argue that That’s Great News!’s use of GateHouse’s material was a derivative work and that it was commercial.

The problem with a derivative use argument in this case is that the facts closely resemble the facts of another case, a case of binding precedent in the 7th Circuit.  (For non-US/non-attorneys, appeals from the Northern District of Illinois go to the 7th Circuit Court of Appeals.)

That’s Great News!’s use of putting newspaper articles on plaques and selling the plaques is very similar to putting notecards on tiles and selling the tiles.  The 7th Circuit has already decided that putting notecards on tiles does not equal the creation of derivative works and does not result in copyright infringement.  (Short Lee v. A.R.T. Company opinion here.)*

This leads into the problem with a commercial use argument.  While That’s Great News! is making money selling the plaques with news stories, that does not necessarily mean That’s Great News! is violating the terms of GateHouse’s license.  Creative Commons licenses do not affect any uses that are allowed under regular copyright, i.e. they do not prevent fair use, even commercial fair use.  If the court follows the reasoning in Lee v. A.R.T. and decides that That’s Great News!’s use is not a derivative work and is not infringing, it will not matter that That’s Great News! makes money selling its plaques.

As Eric Goldman pointed out on Evan’s post, this is not the first time GateHouse Media has brought a suit for infringing uses of its CC-licensed materials.  In 2008, Gate House sued The New York Times for copyright and trademark infringement, unfair competition and breach of contract, as well as false advertising, trademark dilution and unfair business practices.The two companies settled the case in early 2009. 

Perhaps this case will settle, too.

 

*Note: There is a circuit split in the United States with respect to facts like the notecard-tiles and whether than is a derivative work.  The 9th Circuit has held that it is a derivative work.  See Mirage Editions v. Alburquerque Art.

(As always, my post here is for The 1709 Blog and is not on behalf of, or representing the opinions of, Creative Commons.)