Big sums at stake in Serbia

On 27 July 2010, the Belgrade Commercial Court issued a first instance decision in which it ordered the public broadcaster Radio Television of Serbia (RTS) to pay Serbian copyright organization SOKOJ the not insubstantial sum of EUR 1,293,739 (US$ 1,653,614) for broadcasting music without paying royalties to its composers.

This is apparently just a skirmish in a very long battle between SOKOJ and RTS, with the prospect of an appeal in the offing. According to SOKOJ, this is "the most important decision ever made in the field of copyright protection" [presumably in Serbia, at any rate] and that it makes it clear that the legislation in this area must be respected. There's plenty of money at stake as well as principle: if the decision becomes final. RTS will have to pay SOKOJ nearly EUR 2 million (US$ 2,556,334) after the addition of interest. These sums are very large if one takes into account the cost of living in Serbia.

The 1709 Blog hopes to find out more about this dispute and, in particular, about the grounds of any defences.

Source: PETOSEVIC newsletter here.

US record labels say that copyright law "isn't working"

Speaking at the Technology Policy Institute's Aspen Forum, The President of the Recording Industry Association of America, Cary Sherman, has said that the current U.S. copyright law "isn't working" for content owners and contains a number of loopholes - the main one he objected to is, of course, the safe harbour protection given to internet service provides (ISPs), web companies and telecomms providers. According to CNet, Sherman said the 1998 Digital Millennium Copyright Act "isn't working for content people at all," saying "You cannot monitor all the infringements on the Internet. It's simply not possible. We don't have the ability to search all the places infringing content appears, such as cyberlockers like [file-hosting firm] RapidShare." Sherman added that YouTube is doing a good job of filtering and removing copyright-infringing videos but added that Google could do much more than simply having YouTube remove videos making the example thsat "If you enter in "Beyoncé MP3" as a Google seach the "the chances are, the first thing you'll see is illegal sites." In response Lance Kavanaugh for YouTube, said that the DCMA is working exactly as Congress intended it to. "There's legal plumbing to allow that to happen, to allow those small companies to innovate without [the] crushing fear of lawsuits, as long as they follow certain rules," he said. "Congress was prescient. They struck the right balance". Youtube recently avoided liability in a case brought against them by Viacom, owners of MTV, for hosting MTV content without Viacom's permission because they operated a take-down system although Viacom plan to appeal the decision.

Sherman's comments, on an Act which was heavily lobbied over by ISPs, internet companies and the content owners - is based on the growing concern that the Act contains real and dangerous loopholes (well, dangerous for content owners) which allow ISPs and other web-based companies to ignore online copyright infringement without any legal comeback - although despite his concerns, Sherman added that he did not see new legislation as the solution to this at this stage - preferring to reach agreements with web firms directly. He explained: "We're working on [discussions with broadband providers], and we'd like to extend that kind of relationship - not just to ISPs, but search engines, payment processors, advertisers. But Sherman then added "if legislation is an appropriate way to facilitate that kind of cooperation, fine" saying it may be necessary for the U.S. Congress to enact a new law formalizing agreements with intermediaries such as broadband providers, Web hosts, payment processors, and search engines - one presumes the RIAA are contemplating asking the US legislature for new laws along the same lines as the various "three strikes" laws passed in the UK, France, Taiwan, South Korea and New Zealand.

The RIAA have also signed up to a new letter sent to Google and US ISP Verizon regarding their recent announcement on so called "net neutrality". The consortium of American content owners which included indie labels body A2IM and collecting societies BMI, ASCAP and SESAC, called on the two web giants to add cracking down on piracy to their joint mission.

Interestingly in related news, online advertising firm Triton Media is being sued by several movie studios for "contributory" and "induced" copyright infringement, over its alleged dealings with unauthorized websites offering their content for free. Disney and Warner Bros filed suit against Triton, alleging the firm helped websites like PirateCity.org and Watch-Movies-Links.net profit from piracy by handling their advertising sales. The studios said the advertising agency knew the sites were offering unauthorized content because they sent notices to Arizona-based Triton. The lawsuit seeks an injunction against Triton providing advertising services to the sites in the future, and unspecified monetary damages.

In other RIAA news, Joel Tenenbaum, the Boston University graduate student who lost his case against the recording industry for illegally downloading and sharing music has said that he will be appealing a federal judge’s order that he pay four record labels $67,500 in damages for copyright infringement, even though that amount is only a tenth of what a jury said he should pay for copyright infringement on 30 songs. The original order was a whopping $675,000. “Sixty-seven-and-half thousand dollars only sounds reasonable because it was so much before’’ said the 26-year-old former Providence resident, who then added that he would have to declare bankruptcy if forced to pay the smaller award. His lawyer, Harvard Law professor Charles Nesson, has filed a one-page notice saying he will appeal with the US Court of Appeals for the First Circuit. Nesson said in an interview that he plans to challenge several rulings Judge Nancy Gertner made at trial, including her refusal to let jurors hear that Tenenbaum offered to settle the labels’ claims against him in November 2005 for $500. The four record labels who brought the action (Sony BMG, Warners, Arista and Universal) have filed a similar notice and RIAA spokeperson Cara Duckworth said in a statement yesterday that the labels “had no choice but to appeal the erroneous and unprecedented decision’’ by Judge Gertner on July 9 to slash the award by 90 percent". “The ruling casts aside a jury verdict squarely within the range established by Congress and clearly supported by the undisputed harm to the recording industry and the egregiousness of the defendant’s conduct,’’ she said.

http://news.cnet.com/8301-13578_3-20014468-38.html
http://tinyurl.com/29326mq (Hollywood Reporter)
http://en.wikipedia.org/wiki/RIAA_v._Tenenbaum

Too many California girls?

A few weeks ago, this blog reported here about the efforts of Performing Rights Organizations (PROs) to collect royalties from commercial users of music throughout the United States. Notably, PROs have developed proprietary technology that can recognize millions of songs even by just a few notes. Using this technology, the PROs can easily recognized when music they represent has been "sampled," interwoven in part into a new piece of music by another artist, thus generating royalty obligations.

Now comes news that Rondor Music International, the publishing company that controls the rights to the Beach Boys' "California Girls" has sent a claim notice to Katy Perry, Snoop Dogg, and their co-writers and publishers demanding that they add the Beach Boys' members as co-authors of their song "California Gurls" because the song references the Beach Boys' classic song.

The incident highlights the potential deviation of interests between writers/performers and the publishers managing the rights. The Beach Boys, when asked, responded that they love Perry's song and appreciated the influence their own song had in the creation of California Gurls. In fact, Brian Wilson said "the melody is infectious, and I'm flattered that Snoop Dogg used our lyric on the tag," and Mike Love summed up his opinion by saying,

"[it] obviously brings to mind our 'California Girls,' it's just in a different vernacular, a different way of appreciating the same things. The Beach Boys have always accentuated the positive, and [Perry's] is a positive message about California Girls, so what's not to like?"

Music publishers like Rondor, by contrast, don't appreciate imitation without remuneration. The Perry/Snoop Dogg song absolutely evokes the Beach Boys' classic, but it has its own flavor and lyrics, with the exception of one nearly identical line ("I really wish you all could be California girls"). Is there enough overlap to warrant co-writing credits and copyright interests? Rondor certainly believes so: "It is up to the six writers and various publishers of 'California Gurls' to decide whether they honor the claim or not." On the other hand, there are certainly agruments, like fair use, that could lead to a finding against Rondor if this incident ever lands in court. No hint yet on what action Rondor may take if the Beach Boys aren't granted the co-writing credits sought.

Database rights: a reader asks

A reader has posed the following question, to see what the readers of this blog might think:

"Company A purchases the majority share of Company B; a share purchase agreement is signed. The IP clause in the agreement states that Company A has the use of the IP rights of Company B, including Company B's database (a customer list, updated from time to time). After the purchase, Company A merges the information in the database with its own data (with the approval of Company B).

Company B subsequently goes into liquidation. There has been no assignment of the rights in the database, but the database has been substantially changed due to the merging of the data with Company A's own data. I know that, if the merging with the data was a "substantial change" to the contents which would be sufficient to satisfy the requirement for a "substantial new investment", then the amended database would qualify for a new 15 year term of protection. If this is the case, I would think that Company A is the author of the new database, and is entitled to keep using it (and entitled to tell the administrator they can't sell the new database).

However, I don't think Company A can do anything about the database in the form it was in when Company B initially created it, because at that time, Company B was the author of that database".

Do you agree? Please post your comments below.

German industrial expansion: blame it on copyright?

"The Real Reason for Germany's Industrial Expansion?" by Frank Thadeusz, published on Spiegel Online here, has already been the subject of this post on the IPKat by Mark Schweizer which has already attracted a fair degree of serious comment. The author's byline, "Did Germany experience rapid industrial expansion in the 19th century due to an absence of copyright law? A German historian argues that the massive proliferation of books, and thus knowledge, laid the foundation for the country's industrial might", tells you why it's so interesting. Enjoy!

Are pop videos overrated?

Last week Mr Justice Floyd allowed an appeal from a decision of the Copyright Tribunal over the royalty TV channels should pay for broadcasting music videos. CSC Media Group, which operates seven TV music channels, licenses its videos from Video Performance Ltd (VPL). As VPL is a collective licensing body, CSC had the right to refer the terms of its expiring licence to the Copyright Tribunal. Last year, the Tribunal determined that the correct fee for CSC to pay VPL should be 12.5% of revenues rather than the existing 20% (pro-rated according to amount of VPL content used).

Decisions of the Tribunal can be appealed on a point of law. The Copyright, Designs and Patents Act 1988 requires the Tribunal to set reasonable terms and in determining what is reasonable it should have regard to the terms of other similar licences. The High Court argued that the most relevant licence for the Tribunal to consider was VPL’s licence to BSkyB, which had a 20% royalty. Although the Tribunal had referred to the BSkyB licence, it only did so after it had already made its mind up that the royalty should fall within a window of 10–15%. This meant that the BSkyB licence was given insufficient weight in its decision-making process. The Tribunal had ‘had regard’ to it, but not primary regard. The Tribunal had erred in law: it had jumped through the right hoops – but in the wrong order.

But is it really undisputable good sense to use the BSkyB licence as the principal measuring stick for the CSC licence when both were from the same collective-licensing body? Both licensees must have experienced a similar imbalance of bargaining power – VPL was the only possible licensor for the content they required and it had apparently made the 20% non-negotiable for years. If anything, BSkyB may have been even more unenthusiastic about the terms than CSC – unable to make good business out of music video, it wasted no time in selling off its channels even before its licence was signed.

The record labels vs the broadcasters - what’s phones got 2 do with it?

Here's a novel way to resolve a dispute between two parties. Ask the government to put an obligation on a third party to cure all your ills. The long-running dispute between US radio broadcasters and the recording industry over the royalties broadcasters should have to pay to use recorded music has taken an unexpected turn with a proposed settlement where a suggested new federal mandate would require all new mobile phones to come with a built-in FM radio chip. The National Association of Broadcasters (NAB) has long been fighting any proposals that would require radio stations to pay royalties to record labels and performers for the right to play their sound recordings on the air. The US (unusually) has no current legal requirement for a royalty for the use of recordings for FM stations - although now in the US internet, cable and satellite radio services and stations do have to pay an equivalent of the UK’s PPL royalty: Broadcasters have long argued that airplay provides free promotion and drives music purchases and concert ticket sales.

The new idea is to push forward a proposed settlement that would establish a tiered system of royalty payments that would bring in a total of roughly $100 million for the music industry. Commercial radio stations with more than $1.25 million in annual revenue would pay royalties totalling 1 percent of revenue. The smallest commercial and not for profit stations would pay either 1 percent of revenue or $100 annually, whichever is less.

The prospect that the US government could dictate key design decisions for mobiles has alarmed electronics manufacturers as well as consumer groups, not least as many say they don’t actually want or need FM on their phones, that it is an outdated and redundant idea and that practical problems such as a second antenna, reduced battery life, additional weight and more bulk would be unattractive to consumers. Gary Shapiro, Presient of the Consumer Electronics Association said “Consumers clearly aren’t interested in (ad laden) FM radio on their mobile phones and other consumer gadgets - especially with the availability of Pandora, Slacker and other similar smartphone music apps that are now widely popular" adding the “backroom scheme” from the broadcasters and the labels to have Congress mandate broadcast radios in portable devices, including mobile phones, “is the height of absurdity” adding “Rather than adapt to the digital marketplace, NAB and RIAA act like buggy-whip industries that refuse to innovate and seek to impose penalties on those that do.”

Both the House of Representatives and the Senate Judiciary Committees have passed bills that would give recording labels and artists a share of advertising revenue that the FM radio stations generate by playing their recordings, but neither of those contained a FM chip mandate. As both bills have stalled due to fierce broadcaster resistance, legislators asked the NAB and MusicFirst (for the labels and for recording artists) to try to negotiate a compromise. Hence the new mobile idea.

It seems that the parties are nowhere near concluding the deal despite optimism from the record labels with Recording Industry Association of America boss Mitch Bainwol saying that whilst “Nothing is locked down just yet" the parties were on "the precipice of an historic breakthrough”. Hmmmmmmmmm!

http://www.myce.com/news/riaa-broadcasters-want-fm-radio-mandatory-on-smartphones-33362/

Another ECJ reference on monitoring and SABAM

This blog has already reported here on the ECJ reference in the case of SABAM v Tiscali.

To that case has now been added another reference from the Belgian courts in the case of Netlog v SABAM. At this stage, details in English are hard to come by, but it appears that Netlog, a social networking site, was subject to a similar attack from SABAM as that which Tiscali/Scarlet received. The difference, of course, is that as a social network, Netlog sits in a different point in the value chain than the ISP and therefore at a different point in the intersection between the various applicable legislation (e-commerce directive, data protection legislation, IP enforcement directive).

The Belgian court rejected SABAM's demands for Netlog to implement filtering and sent the case to the ECJ. It has been filed under case number C-360/10 - but at this stage, the author has been unable to track down any further details of the questions. Netlog's lawyers were quoted as saying they had won on all counts (although I guess his clients would have been even happier for the case to have been dismissed, rather than sent to the ECJ for another year or two of litigation).

Moral Rights... and unhappy bedfellows

It is a fact universally acknowledged (at least among comparative copyright lawyers) that moral rights and common law countries aren’t the happiest of bedfellows. When the United States acceded to the Berne Convention in 1988, one might have expected them to introduce comprehensive moral rights protection in accordance with Article 6bis Berne Convention. What we did get was the Visual Artists Rights Act 1990 (VARA), incorporated into the Copyright Act as § 106A. VARA bestows moral rights only on the authors of specific kinds of works, namely

“paintings, drawings, prints, sculptures, still photographic images produced for exhibition only, and existing in single copies or in limited editions of 200 or fewer copies, signed by the artist.”

As that leaves the overwhelming majority of works out in the cold, the cases where § 106A is invoked are few and far between. However, a highly interesting lawsuit relying on § 106A is currently before the United States District Court for the Middle District of Pennsylvania.

The Plaintiff is David Ascalon, a renowned sculptor (http://en.wikipedia.org/wiki/David_Ascalon). The Defendants are the Department for Parks and Recreation in Harrisburg, Pennsylvania (“DPRH”), the Jewish Federation of Greater Harrisburg (“Federation”), and David Grindle, an artist and/or restorer. In the early 1990s, the Federation and the DPRH decided to create a memorial site to honour the victims of the Holocaust. Mr Ascalon submitted the winning entry for a commemorative sculpture, which was duly made and erected on the site. It consisted of a shining stainless steel core in the shape of a Star of David, around which was wrapped a serpentine shaped structure of a darker and wearing type of steel. The shining stainless steel, suggesting permanence, represented the Jewish people and their endurance under unimaginable suffering. The rusting steel structure represented the barbed wire fences of the Nazi death camps, implying oppression, decay and misery.

In 2003, there was some concern as to the state of the rusting steel part of the sculpture and whether restoration work would be required. According to the statement of claim (http://www.courthousenews.com/2010/07/28/Holocaust.pdf), Mr Ascalon offered to carry out any necessary restoration work, but was eventually not taken up on that offer. Amazingly, in 2005 he received a cease and desist letter from the Federation, demanding he stop referencing the sculpture. In 2007 he learned that, unbeknownst to him, the sculpture had been altered in several ways. Not only had the dark steel structure been replaced by a structure of the same shining stainless steel as the core structure, but his name had been erased from the sculpture as well. Instead, it sported the caption “Restored by David Grindle 2006” and the names of the “Restoration Advisors.”

The Statement of Claim describes the effect thus:

“The modification of the sculpture has changed it so that now the same shiny stainless steel that represents the enduring Jewish people is also used to depict the Nazi regime and atrocities of the Holocaust. This alteration is abhorrent, and runs completely contrary to the core vision of the Memorial, which was based on the notion of creating a striking and stark visual contrast between the Jewish people and their Nazi oppressors. The sculpture as modified now creates a visual equivalency between good and evil, which is a mutilation and bastardization of the artwork and its purpose.”

Looking at the pictures, I must say I agree. Sadly, the case might be less clear-cut than my civil heart wants to believe: According to § 106A(a)(2), the author of a work of visual art

“shall have the right to prevent the use of his or her name as the author of the work of visual art in the event of a distortion, mutilation, or other modification of the work which would be prejudicial to his or her honor or reputation.”

I suppose by grinding off Mr Ascalon’s name the Defendants successfully avoided violation of § 106A(a)(2). Nice.

§ 106A(a)(3) states that the author shall have the right

“(A) to prevent any intentional distortion, mutilation, or other modification of that work which would be prejudicial to his or her honor or reputation, and any intentional distortion, mutilation, or modification of that work is a violation of that right; and
(B) to prevent any destruction of a work of recognized stature, and any intentional or grossly negligent destruction of that work is a violation of that right.”

Distortion? Oh yes. Mutilation? I should think so. But now the old Article 6bis BC problem raises its ugly head once more: Does “prejudicial to his honor or reputation” only refer to modifications or also to distortions and mutilations? Most courts and commentators agree that the better view is that the prejudice requirement applies in all cases. VARA does not define the terms “prejudicial,” “honor,” or “reputation,” but I have no doubt that it would be harmful to Mr Ascalon’s honour and reputation in artistic circles if anyone were led to believe that he agreed to the changes made to his work. But since his name does not appear on the sculpture anymore (and he is demanded to cease and desist from referencing his work), is the modified sculpture still capable of being prejudicial to his honour or reputation? Or can anyone distort and mutilate a work to their heart’s content as long as they at the same time disassociate the author from it? Gilliam v American Broadcasting Company 538 F.2d 14 (1976) springs to mind, where Judge Gurfein pointed out that the Lanham Act would do nothing for the Plaintiffs if the Defendants had clearly labelled the truncated versions of “Monty Python’s Flying Circus” as not in keeping with what the Plaintiffs had intended. § 106A(a)(3)(B) might not be the answer either. While no prejudice to honour and reputation is required, as the work, though probably of “recognized stature”, arguably was not destroyed but merely damaged (I assume it is not beyond repair).

A further complication stems from § 106A(c)(2), pursuant to which the modification of a work of visual art which is the result of conservation is not a destruction, distortion, mutilation, or other modification unless the modification is caused by gross negligence.” It will be interesting to see what the court makes of this case. Moral rights are an extension of the author’s personality and VARA is supposed to protect “both the reputation of certain visual artists and the works of art they create” (House Report, 1990 U.S.C.C.A.N. at 6915). In my view that implies rather more than a law against misrepresentation like the Lanham Act, and it should not be possible to circumvent § 106A(a)(3) by removing the author’s name and otherwise trying to disassociate him from his work.

(Source of photographs: http://img823.imageshack.us/cpreredodetail.jpg/)

Circus Globus: an explanation from Romania

In "Communication questions: Romania asks the oracle", the 1709 Blog posted this item on a mysterious reference from Romania of questions in need of a preliminary ruling from the Court of Justice of the European Union. The case in question is 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. We had no idea what this was all about and asked our readers for help.

Our sincerest thanks are now due to Tudor Chiuariu (Senior Partner, Chiuariu & Associates, Bucharest), who has written the following:

"The court of first instance ordered the defendant Circus Globus to pay the claimant UCMR-ADA, a copyright collective management organization, an amount of about EUR 235 000 as remuneration for copyright musical works “publicly communicated” during the circus and cabaret shows of Circus Globus between May 2004 and September 2007. There is no information publicly available on the court’s website as to whether the communication to the public of the musical works included live performances, the use of phonograms, or both.

The court of second instance rejected the defendant's appeal and upheld the decision of the first instance. A second appeal was filed by the defendant, now pending before the High Court of Justice and Cassation (HCJC), in which only the application of the law to the specific case is discussed (not the merits of the case). Before taking the final decision, the HCJC referred the following questions to the ECJ:

"Is Article 3(1) of Directive 2001/29 ... to be interpreted to the effect that “communication to the public” means:
- exclusively communication to the public where the public is not present at the place where the communication originates, or
- 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?

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?"

National legal provisions

Communication to the public enjoys a very broad definition in Romanian copyright law (Art. 15(1) of Law no. 8/1996 as amended):

“any communication of a work, effected directly or by any technical means, in a place open to public or in any place where a number of persons are gathered exceeding the normal circle of a family and its relations, including the performance on stage, reciting or any other kind of public performance or direct presentation of the work, … , the presentation in a public place by sound or audiovisual recordings, as well as the presentation in a public place by any means, of a radio broadcasted work. It is also considered to be public, any communication of a work by wire or wireless means, effected by making it available to the public, including through Internet or other computer networks, in such a way that any member of the public may access it from any place and at any time individually chosen.”

The second national legal provision which is relevant is Art. 1231(e) of the Romanian copyright law, which imposes compulsory collective management for the exercise of the right to the public communication of musical works (except for public projection of cinematographic works).

This legal provision entitles UCMDR-ADA to claim the remuneration as explained above in the absence of a contractual relationship with the original right owners, their right to exclude their works from collective management being denied by law.

Conclusion

Apparently the HCCJ aims to establish whether there is any incompatibility with the InfoSoc Directive in the national legal definition of the right to public communication of a work and in providing for compulsory collective management for the exercise of this right with respect to musical works.

It is worth mentioning that Art. 1231(e) has been the subject of an objection of non-constitutionality raised in another case involving UCMR-ADA. The author of the objection argued that imposing compulsory collective management for public communication of musical works irrespective of the means of communication (direct or indirect), is contrary to several articles of the Constitution related to the protection of private property, freedom of commerce, fair competition and copyright (see for example the situation where the performer is at the same time the copyright owner and UCMR-ADA still acts as an intermediate in the management of his rights).

The objection was dismissed and the Constitutional Court, inter alia, considered itself not competent to rule on the interpretation of the right to public communication as understood within the context of the InfoSoc Directive (i.e. whether the interpretation includes the case where the public is present at the site where the communication originates). This might explain the wording of the first question referred by the HCJC to the ECJ".

Infopaq: The Sequel

This weblog has already noted the ruling in Case C-5/08 Infopaq International A/S v Danske Dagblades Forening, a reference to the Court of Justice of the European Union for a preliminary ruling from the Danish Højesteret. Responding to this reference, which dealt with the legalities of what might be termed a modern equivalent of a cuttings agency, the Court of Justice provided just two answers to the 13 questions referred. This June there arose another reference in which the same court, with the same litigants before it, has asked some of the same questions, either in the same form or with some modifications (see today's IPKat post here).

What the Kat didn't mention, but might interest true copyright agitators and lobbyists, is that you've got a chance to make observations on the questions. The UK's Intellectual Property Office invites your comments by next Monday, 16 August 2010 (please email them here so that the UK can decide whether it wants to get involved). The deadline for observations to the Court is 15 October 2010.

Nintendo games more than just 'computer software'

In November 2008 the Dutch branch of video game producer Nintendo took action against several Dutch resellers of R4 flash cards and mod chips which were intended for use on Nintendo DS, DSi and Wii products. Both the flash card and the mod chip neatly circumvented Nintendo's console technology which was supposed to stop the use of illegally copied and/or unauthorised software. Nintendo’s claims were based both on copyright and trade mark infringement, though in the end the latter turned out to be unnecessary. Dutch copyright lawyers were all curious to see whether the copyright infringement would be argued in respect of ‘computer software’ or for a ‘work protected by copyright in general’, since a video game has elements of both.

Giving judgment on 21 July 2010, the Court of The Hague said it was the element that demanded the producer's most creative efforts that should be decisive as to what sort of work was to be protected: here it was general protection as a copyright work, rather than 'computer software' which was more appropriate. Why was this? Said the Court, Nintendo’s submission pointed to an extensive creative process in which elements such as the storyline, the characters and text (collectively referred to as 'the design') are created – or at least outlined – before the software programming can even begin. Since the programming had to be fitted to the video game designed, the resulting game program was subordinate to the design.

Having ascertained what sort of work it was that Nintendo sought to protect, the next question was: which is the legal provision that protects it? Article 29a of the Dutch Copyright Act turned out to be the most suitable weapon. This Article provides that it is unlawful to circumvent measures that are intended to prevent or restrict acts regarding works protected by copyright, if those acts are not permitted by the producer or its successor. Since the flash cards and the mod chips dodged Nintendo's data copy protection, Article 29a was infringed. The fact that the protective measures by Nintendo were designed to prevent all unauthorised use, whether unlawful or not, was simply irrelevant, though the Court added that Article 29a did not measures that were more far-reaching measures than strictly preventing copyright infringement. Nor was the Court impressed by the defence plea that Nintendo was abusing its powers, since Nintendo does actually grant licences to other producers.

As a result of infringing Article 29a the defendants were ordered not to import, distribute, sell or carry out any commercial activity with the flash cards or mod chips, on pain of a penalty of EUR 10,000 per day or EUR 1,000 per product. Better still for Nintendo, destruction was ordered for all flash cards and mod chips in the defendants' possession. Nintendo still has damages to come, plus the costs of the proceedings. The Court was silent on the trade mark infringement claim: Nintendo no longer had an interest in it that would exceed the legal measures to which it was entitled, based on copyright infringement.

The 1709 Blog thanks Willem Leppink (partner/advocaat, Ploum Lodder Princen, Rotterdam) for this information.

What’s Your Motto?

I just love it when hip hop artists get involved in law suits; it’s the best way to learn their full real names (and generally get in a good chuckle). These cases also tend to result in a bunch of crinkly old men, and sometimes women, parsing street slang and debating the similarities of ways to describe females. Usually good for another round of amusement.

Blessing us with a new wonderful opportunity for fun is Deandre Cortez Way, aka Soulja Boy Tell ‘Em, who is being sued for copyright and trademark infringement (and unfair competition, unjust enrichment and consumer protection act violations) for some postings on his website and a tattoo on his chest.

The plaintiff in the suit is Clement Brown, Jr., owner of the clothing line Laundry Money. He claims that he has a valid copyright infringement for the following grouping of words and phrases, which is the Laundry Money slogan:

grind…hustle hard…double up…
flip…stack…get your weight up…
save…cop…invest…re-cop…reinvest….
own your own business…
buy property…network…
build credit…stay determined…
stay focused… stay dedicated…
and Keep…
LAUNDRY MONEY
”clean clothes 4 dirty work”

Brown alleges that Soulja Boy has infringed the Laundry Money slogan in his S.O.D. Money Gang Code of Honor, which is as follows:

Grind.. Hustle.. Double Up.. Flip.. Stack.. Get Yo Weight Up.. Save.. Shop.. Invest.. Recoup.. Own Your Own Business.. Buy Property.. Network.. Build Credit.. Stay Determined.. Stay Focused.. Stay Dedicated.. Never Lie To Your Higher Authority.. Have Goals.. Always Represent.. Always Remember Money First.. Use Your Head.. Business First.. Plan Ahead.. Never Snitch.. Don’t Be Afraid.. Always Be Prepared.. Stay On Time.. Sleep 10%.. Gang Colors Yellow and Green.. Never Betray The Boss.. You Only Get One Shot.. GET MONEY….

There are some similarities; there are also some differences (beyond the fact that one party knows how to use capitalization and the other party, punctuation). For example, Soulja Boy’s rules work like my dad’s; there’s two “first”s. Laundry Money doesn’t specify if any of its mantra pieces are more important than the others.

The complaint says that Soulja Boy uses this Code of Honor on his website, in his cd booklets and has it tattooed on his chest. I was unable to find it on the Soulja Boy website, except in use as an id or in comments by “Team Soulja Boy” members, i.e. fans. Unfortunately, my Soulja Boy album is in storage, so I cannot pull out the booklet to look for the Code there.

As for Soulja Boy’s chest, the complaint quotes the tattoo as:

Grand Hustle
Invest Sleep 10%
Save Get
Money

That’s more than a little different than the long Laundry Money slogan above.

In addition to comparing the similarities of the texts, there are a number of other issues that the court may need to address, including:

• Coprightability of the original work, is it original?
• Access, this may come down to timing. Brown claims the slogan was created as early as 2004 and registered in July of 2008. Soulja Boy had his chest tattoo by November 2008 at the latest. Is Laundry Money as big as it says it is? When did it get big?
• Is a tattoo a fair use? (There’s a great resource on copyright tattoos available from Rebecca Tushnet’s 43(B)log here.)

Stepping up to the slang-parsing task this time will be the Honorable Judge Victoria A. Roberts of the Eastern District of Michigan. As someone who may be around teenagers more than your average judge, through her involvement with the Big Brothers Big Sisters organization, Judge Roberts may have any easier time working her way through the slogan and code of honor. Will be interesting to see what she has to say! (If the case doesn’t settle first…)

Case details and documents (for a fee) available here: Clement Brown, Jr. v. Deandre Cortez Way et al 2:10-cv-13016-VAR-MAR. Video of muzungu teaching Zambians how to do Soulja Boy’s dance here.

Photo: Soulja Boy playing X-box by Kevin cc-by available on Flickr.

Congress, Always Pushing Dates when it Comes to Copyright

Just as it’s extended copyright terms in the past, the US Congress has no extended the wait for important copyright discussions.  Albeit, this time indirectly.The State of the Net West Conference was scheduled to take place this week in Silicon Valley. 

An important US conference that brings together law makers from congress and technology makers from country, State of the Net West explores a variety of issues surrounding the internet and government policy. 

Most copyright-related on this year’s schedule is a discussion led by Congressman Bob Goodlatte entitled “Intellectual Property and Internet Policy”.  The conference info page describes the session thus:

Numerous cases and policy changes are testing the boundaries of intellectual property protection in the digital age. Join us for a discussion hosted by Congressman Bob Goodlatte exploring the key intellectual property issues in both Washington and Silicon Valley. Congressman Bob Goodlatte is uniquely positioned to lead this debate as both the Co-Chair of the Congressional Internet Caucus and the Co-Chair of the Congressional International Anti-Piracy Caucus. The discussion will explore how the courts and the industry are working to ensure that creative copyrighted works continue to fuel Internet innovation. Expert panelists will discuss how recent court decisions including Viacom v. YouTube and LimeWire are defining and challenging copyright law -- and what it means for the future of copyright and Internet policy. Congressman Goodlatte will also discuss anti-piracy efforts and enforcement methods including payment processing, domain name seizures and ISP graduated response (a.k.a. copyright strikes) proposals.

Unfortunately, the conference has been postponed due to an emergency session of Congress.  [Maybe to deal with this?]  1709 hopes to be able to pass along more information when the conference is rescheduled.

You want me to pay?

The New York Times Magazine had an interesting feature this weekend about the efforts of BMI to collect music royalties from bars, restaurants and other commercial venues around the United States. Apparently, as a society, we believe that creators of music deserve to hold and exploit copyrights in their works, but we really, really, really don't want to pay to use those copyrights.

Broadcast Music Incorporated, otherwise known as BMI … is a P.R.O., or performing rights organization; P.R.O.’s license the music of the songwriters and music publishers they represent, collecting royalties whenever that music is played in a public setting. Which means that if you buy a CD by, say, Ryan Adams, or download one of his songs from iTunes, and play it at your family reunion, even if 500 people come, you owe nothing. But if you play it at a restaurant you own, then you must pay for the right to harness Adams’s creativity to earn money for yourself. Which leaves you with three choices: you can track down Ryan Adams, make a deal with him and pay him directly; you can pay a licensing fee to the P.R.O. that represents him — in this case, BMI; or you can ignore the issue altogether and hope not to get caught.

P.R.O.’s like BMI spend much of their energy negotiating licenses with the biggest users of music — radio stations, TV and cable networks, film studios, streaming Internet music sites and so on. But a significant portion of BMI’s business is to “educate” and charge — by phone and in person — the hundreds of thousands of businesses across America that don’t know or don’t care to know that they have to pay for the music they use. Besides the more obvious locales like bars and nightclubs, the list of such venues includes: funeral parlors, grocery stores, sports arenas, fitness centers, retirement homes — tens of thousands of businesses, playing a collective many billions of songs per year.

Most Americans have no problem with BMI charging for its music — except when they do. As Richard Conlon, a vice president at BMI in charge of new media, put it: “A few years back, we had Penn, Schoen and Berland, Hillary [Clinton]’s pollster guys, do a study. The idea was, go and find out what Americans really think about copyright. Do songwriters deserve to be paid? Absolutely! The numbers were enormously favorable — like, 85 percent. The poll asked, ‘If there was a party that wasn’t compensating songwriters, do you think that would be wrong?’ And the answer was, ‘Yes!’ So then, everything’s fine, right? Wrong. Because when it came time to ask people to part with their shekels, it was like: ‘Eww. You want me to pay?’”

This attitude tends to stem from the fact that music is freely available, legally or otherwise. Once a business owner has the music, say, by paying for and downloading songs from iTunes for personal use (or downloading them illegally from another source), he generally doesn’t understand the need to pay licensing royalties (or want to) for using the music at his business. According to the feature, BMI licensing executives are frequently assaulted, verbally and sometimes physically, when visiting local sites that have not yet licensed the music they play. BMI strategizes its copyright royalty collections operations based on the viewpoint that people believe that copyrights should be protected but that they personally don’t want to pay for a license.

BMI knows it will be tough to collect from every business that uses BMI-managed music and owes royalties, but they also know they have the law on their side. And, having never lost a dispute in litigation, BMI is willing to take action when necessary in order to protect the rights of its artists. Often, though, business owners relent and negotiate a license fee that fits within their budgets.

The Internet has been a boon to PROs seeking to collect royalties on the music copyrights they represent. Using the Internet, for example, a BMI licensing executive can search business listings within his region to keep tabs on new businesses, as well as shuttered ones. Then he can pick up the phone and ask the business owner to agree to a reasonable license based on expected use. BMI claims that its agents make more than one million phone calls a year in order to secure licenses from as many domestic businesses as possible.

In addition, new technologies are making it easier for BMI to close licensing deals and maintain or increase its revenues year-over-year:

It is worth noting that during the years the recording industry lost nearly 60 percent of its income, BMI and its competitor ASCAP had steady increases in profits. BMI has done so by going after how people use music commercially, regardless of medium. As the president and chief executive of BMI, Del Bryant, likes to say, “You have to be in the future a little bit.”

In BMI’s case, this has meant leapfrogging from AM radio to FM, from movies to cable to digital radio to streaming to (once-illegal) downloading companies like Napster. (BMI began working on a deal with Napster about streaming music even before it sorted out its legitimacy.) They also signed with Rhapsody, the online streaming site, when the company was in its infancy. The trick, says Bryant, is to understand the content world as an ecosystem. When a new player comes along, don’t kill it, make a deal with it. With each new medium, he says: “We made agreements that weren’t that heavily monetized, and not that heavily binding because we didn’t know if it’d be around for long or how it would evolve. They were place keepers, ways to get us working together. And they slowly solidified. It’s all a question of pricing. The system has to serve everyone’s purposes.”

Richard Conlon echoed what Del Bryant said. “We’re not about shutting things down.” he told me. “We’re about nurturing markets. We don’t want people NOT to use it. We know the market is fractionalizing. You wanna take our music and stream it and have electronic whatevers that play when you stick a chip into something or somebody? Go ahead! Do it! Just pay us!”

… While the rest of the content world worries that technology will be the end of content, P.R.O.’s are banking that technology will save it. BMI has developed a system called Blue Arrow that deploys the same technology as iPhone’s Shazam to identify music. (ASCAP uses a similar system called Mediaguide.) These systems can listen to Internet sites, as well as radio and TV stations around the world and identify, in two seconds, virtually any piece of music being played — not just American, but Turkish, Arabic, Chinese, Korean, Latin, Japanese and so on. The Blue Arrow database has a capacity of 500 terabytes (one thousand gigabytes each) of music, and can recognize eight million songs. About 3,000 new songs are added each day.

This technology has not only aided BMI in negotiating licenses from traditional uses of music, but has also clued them in to other uses of music that require copyright royalties, including a type of use they call “nonsong performances.” These nonsong performances include background music, sampling within another artist’s new music, and station identifier music, all of which should generate a royalty obligation with each use of the copyrighted material. It would have been impossible for BMI (or ASCAP) licensing executives to know about, let alone track down and seek payment for, such uses. But the proprietary technologies now allow executives to track these uses instantaneously.

Still, most people expect their music to be free – and they’re willing to seek out free illegal sources. But BMI's education and collection efforts, as well as those of the other PROs, are making big strides to ensuring that copyright owners receive the compensation they are due. Hopefully BMI's licensing executives will endure fewer spitballs and death threats in the years to come as they continue advocating for and collecting royalties on behalf of the artists they represent.

Moldova's new law

At the beginning of July the Moldovan parliament adopted a new Law on Copyright and Neighbouring Rights. When will it come into force? We're not yet sure, since this will occur three months after publication of the law in the Official Gazette, which is expected soon.

The new Law seeks to harmonise national legislation, bringing it into line with the European directives as well as the international conventions. The draft, lovingly crafted by the State Agency for Intellectual Property (AGEPI) in 2007 and 2008, will replace the current Law on Copyright and Neighbouring Rights, which entered into force in November 1994.

Thank you, PETOSEVIC, for this information.

If there is no net neutrality, is there now a new net liability?

One of the recent gripes from the music industry is that as the internet has developed, internet service providers (ISPs), link sites and search engines have profited hugely from the illegal and infringing activities of their users, with ‘free’ music massively driving up site visits and traffic on the net. The games, TV and film industries see themselves next in line as broadband rolls out across the globe. The content owners also blame the ISPs, links sites and search engines of doing little or nothing to halt this huge flow of data, sometimes criticising ‘safe habour’ provisions in legislation (eg in the USA and European Community) for giving ISPs near blanket protection as ‘dumb pipes’ whose role is simply to facilitate the delivery of data. It hasn’t all gone the way of the ISPs, links sites and search engines and MGM v Grokster was a wake up call, although most link sites still feel safe behind the protection of the detail of the US Supreme Court’s judgment and ‘fair use’ cases such as Google v Perfect 10. This is of course which is why record labels and other content owners have so readily embraced the so called ‘three strikes’ laws in Taiwan, France, New Zealand, South Korea and the UK, not least as it puts at least a limited obligation on ISPs to police their customers traffic and take relevant action over repeat infringers.

News of the new commercial tie up between Google and ISP Verizon made me think again. In the new deal, Verizon appear to be agreeing to prioritise Google’s internet traffic – removing so called “Net Neutrality” where all data is considered equal, and allowing Google’s information to move faster and more efficiently around the globe. But surely if an ISP can prioritise information in this way, they move from being a dumb pipe to a very smart pipe indeed – and surely this must lead to the conclusion that if they can ‘prioritise’ traffic (if paid) they could also do the reverse – and easily block infringing material. Of course asking an ISP to block or filter material brings up a host of question relating to human rights, censorship and privacy BUT – it does at least give the content owners some new ammunition in the fight to monetise their copyrights – and might take away one of the main props used by ISPs to excuse themselves from engaging in policing the web.


http://www.guardian.co.uk/technology/2010/aug/05/google-verizon-net-neutrality
http://www.nytimes.com/2010/08/05/technology/05secret.html
http://en.wikipedia.org/wiki/Perfect_10,_Inc._v._Google_Inc

Casting legal roles in amateur film

Last year Gawker Media’s blog network uploaded a homemade video of actor couple Eric Dane and Rebecca Gayheart in a threesome with a friend. Dane and Gayheart sued for copyright infringement and a settlement has now been reached. According to Reuters: ‘Dane, a “Grey’s Anatomy” co-star, held the camera for a portion of the shoot, giving him a partial copyright in the footage. (The couple’s friend, Kari Ann Peniche, also shot footage, but her rights were said to have been purchased by Dane and Gayheart.)’

Under UK copyright law the owner of copyright in a film is the producer and principal director – a film is treated as a work of joint authorship unless the producer and the principal director are the same person. In this case would Dane and Peniche both be the producer and principal director? Or perhaps Gayheart might be one of the legal dramatis personae whether she held the camera or not?