The CopyKat: A possible point for legal divergence of the UK and EU in light of Brexit? (and much more)

This post was written by Tibbie McIntyre.

Much is spoken of the music ‘value gap’.

It stems from a limitation of liability for hosting providers which host third party content (in the US this is known as ‘safe harbor’). (European legislation can be viewed here, American here.) Essentially, when hosting providers are notified by rights holders of infringing content on their sites, they are required to take down the infringing content. But before such notifications are issued the hosting providers are not liable for the infringing actions of third parties.

YouTube is one of these hosting providers, benefiting from the limitation of liability. It is legally obliged to take down infringing content upon notification from the rights holder.

Meantime, let’s take a look at the music played on YouTube. In 2015, it was estimated that YouTube is responsible for 40% of consumption yet constitutes only 4% of the revenue. Some within the music industry feel that this glaring discrepancy in the numbers is thanks to YouTube’s limited liability. YouTube benefits from a position of strength compared to other streaming firms because in YouTube’s case, the music is already posted online. Spotify et al. must licence and then play.

What does this have to do with Brexit?

Draft Article 13 of the draft Directive on copyright in the digital single market (and Recital 39) is aimed at addressing this value gap by requiring hosting providers to “take appropriate and proportionate measures to ensure the functioning of agreements concluded with rightholders and to prevent the availability on their services of works or other subject-matter not covered by such agreements, including through the use of effective content identification technologies". This basically means that providers – such as YouTube – need to get licenced and implement filtering technologies.

Image in Public Domain

This move has been praised by a group of prominent US musicians, who have lobbied the US government to take similar steps.

It seems positive that the EU is trailblazing in this light.

BUT ….

As pointed out on the IPKat here, Article 13 cannot be implemented without also reforming Article 3 of the InfoSoc Directive and Articles 14 and 15 of the Ecommerce Directive. No one is quite sure yet how this issue will be resolved.

Brexit potentially comes in to play here. No one knows what will happen eventually, but there is always the possibility that the UK government might happen upon this issue and decide to tackle it – it has already been raised by one minister in relation to the Digital Economy Bill 2016-17.

If the UK government presses this issue (with a growing music industry there is no reason why it shouldn’t), the results could be very interesting indeed.

Dancing baby case

The ten year old saga (the baby in the video above should almost be a teenager by now) is rolling on, with the Supreme Court signalling its potential willingness to take the case further. The court has asked the US Solicitor General for his opinion on the matter, suggesting it might proceed with the case.

The district court opinion can be found here, the appeal at the 9^th Circuit can be found here and this issue. The case has also been commented on this blog previously here, and over at the IPKat here and here.

The case centres around whether rightsholders should consider whether a fair use defence applies to content posted online before take-down notices are issued.

Cases where the Solicitor General is asked to offer an opinion are accepted for review more often by the Court. This writer hopes that the justices will look at this case, as it could have a massive impact on how we conduct our lives online.

Follow the yellow brick road

The death knell rang this month for a decade long litigation saga in relation to merchandise relating to The Wizard of Oz, Gone with the Wind and the cat and mouse duo, Tom and Jerry. The 8^th Circuit Court of Appeals again reviewed the dispute, affirming both the $2.57 million judgment and permanent injunction in favour of studio giant Warner Bros.

As background, the defendants (X One X Productions, A.V.E.L.A., Inc., Art-Nostalgia.com, Inc., and Leo Valencia, collectively known as “AVELA”) obtained restored versions of advertising posters and lobby cards for Gone with the Wind, The Wizard of Oz and Tom and Jerry. Images of the famous characters from these films included Dorothy, Scarecrow, Tin Man and the Cowardly Lion from the Wizard of Oz, Scarlett O’Hara and Rhett Butler from Gone with the Wind and the cat and mouse duo Tom and Jerry.

AVELA extracted images from the restored advertising posters and lobby cards and licenced the images they extracted for use on a range of consumer products, including t-shirts, action figures, lunch boxes and playing cards.

The litigation saga began in 2006 when Warner promptly filed suit against the defendant, arguing copyright and trade mark infringement claims under the Copyright Act, Lanham Act and Missouri state law.

An interesting point is that the images on the advertising posters and lobby cards were generated before the films were completed and copyrighted. They were not duly registered in compliance with the copyright notice requirements of the 1909 Copyright Act, 17 U.S.C. §§1 et seq.. The Tom and Jerry images were also never registered, therefore not meeting the legislative requirements of that time period to give copyright notice.  (N.B. some of the images in question had been registered, however protection had not been timeously renewed). This fascinating issue – which was dealt with previously in this long-running saga – on drawing the boundaries between copyrighted works and the public domain in this case can be explored more fully here, here and here.

In the judgement handed down earlier this month, a range of issues were dealt with, including the award of statutory damages (with the appeallate judge finding the $2.57 million against AVELA isn’t disproportionate to the offense)

Importantly, AVELA’s attempt to invoke Dastar failed. Dastar is a Supreme Court judgement handed down in 2003 that holds that trade marks cannot act as a surrogate form of protection of works once copyright has expired.

A telling excerpt from page 10 of the judgement comments on how Dastar does not apply:

“Warner’s asserted trademarks in the characters from the films and cartoons do not run afoul of Dastar. The district court found and AVELA did not dispute that Warner holds registered trademarks in iconic phrases and names from the films and has used the character images for trademark purposes on a host of consumer goods for many years. Images of the film actors in character and signature phrases from the films are not communications, concepts, or ideas that the consumer goods embody as Dastar defines these terms. Products marketed under AVELA’s licenses employ iconic film characters’ pictures to associate the products with Warner’s films, not to copy the film itself. Accordingly, these are trademark claims, not disguised copyright claims, and Dastar does not bar them.”

“The clothes on the hanger do nothing; the clothes on the woman do everything,” – Justice Stephen G. Breyer

This remark was expounded at the Supreme Court earlier this month during a hearing in relation to Star Athletica L.L.C v Varsity Brands, Inc., et al.. The District Court stage can be read here, and the Circuit Appeals stage can be read here. This case has been and will be watched by many across the fashion industry.

The issue at stake in this case is whether designs on cheerleaders’ uniforms can be subject to copyright protection. All parties agree that two-dimensional designs may be copyrighted but the cut and shape of three-dimensional garments may not.

Designs that are utilitarian in nature do not attract copyright protection. Star, the smaller rival of Varsity and the defendant in the original proceedings, contends that the types of designs found on cheerleading outfits – stripes and chevrons etc. – are utilitarian in that they are essential to the function of a cheerleading outfit. This utilitarian function apparently – according to Star – is to “cause the cheerleader to be perceived as slimmer and more curvy than they actually are.”

The sportswear Colossus, Varsity, argued that many, many design variants are available in relation to cheerleading uniforms, yet this clothing still clearly remains for the purposes of cheerleading. In fact, “You can have a white cheerleading uniform worn by a cheerleader with the team name and team logo on it,”

A ruling in this case is expected by June 2017. It will surely be a landmark case for the fashion industry.

The CopyKat - appealing to copyright fans far and wide!

The Shaghai Daily tells us that China's copyright regulator has strengthened its law enforcement policy against alleged piracy in cloud-storage services, which, despite a previous crackdown, "had long provided Internet users a covert channel to download movies and TV series." As part of the 'Sword Net' initiative, cloud-storage services have been ordered to prevent users from uploading, storing or sharing files that may infringe copyright, pursuant to a regulation from the National Copyright Administration (NCA) dated October 14th 2015. The new move was published after a meeting Tuesday attended by leading online data hosting services such as Baidu, Qihoo360, Tencent and Huawei. The new regulation means that cloud service providers must deal wuth those copyright offenders by putting them on blacklist, or suspending or terminating their services. Service providers should also notify copyright holders how to lodge complaints, and commit to handling complaints in a timely manner.

An Illinois couple who own several recording companies specializing in doo-wop, jazz, and rhythm and blues have filed law suit against the major satellite and Internet radio companies in the US over their playing of pre-1972 songs. Following on from the actions from Flo & Eddie of the Turtles and and RIAA, it's the third lawsuit that seeks to obtain payment for use of sound recordings under state copyright laws. Arthur and Barbara Sheridan filed two lawsuits in New Jersey federal court: one against Pandora and Sirius XM (PDF) and another against iHeartMedia (PDF), the parent company of online music service iHeartRadio. Their lawsuits seek class action status, looking to represent owners of pre-1972 songs. The action says that the companies have derived "significant benefits," including "millions of dollars in annual revenue," by playing those songs without permission, the suit alleges. In an action brought by ABS Entertainment, which owns the recordings of Al Green, among others, terrestrial radio broadcaster CBS has argued that not only does state law not apply to their use - a matter the recorded music industry had until recently accepted this interpretation of the law - CBS also says that as it only plays re-mastered versions of pre-1972 sound recordings, these actually have a post 1972 copyright copyright saying "In fact, every song CBS has played in the last four years has been a post-1972 digital sound recording that has been re-issued or re-mastered".  Meanwhile Pandora has confirmed that it has reached a settlement with the major labels over its use of pre-1972 sound recordings. The streaming platform follows the lead of US satellite radio service Sirius which, back in June, agreed to pay $210 million to the three majors - Universal, Sony and Warner - and ABKCO Music, which is best known for controlling the early Rolling Stones catalogue, with Pandora paying the labels $90 million for past and future usage of pre-1972 repertoire More on ArtsTechnica here and the Hollywood Reporter here.

Adolf Hitler's ‘Mein Kampf”  falls out of copyright next year when the term of the copyright, owned by the State of BAvaria, expires. is almost certainly going to re-published and it seems annotated German and French reprints are being prepared. Last week a Paris publisher, Fayard, confirmed in a statement it was going ahead with an annotated French print, after pondering on it for the past four years. A German-language reprint will be handled by the government-funded Institute of Contemporary History in Munich, which emphasizes the book’s historical importance. It too, will be annotatated. More on the Times of Israel here.

The Supreme Court of India has held that no copyright exists on the "title" of a literary work, reversing the decision of the Bombay High Court: "No copyright subsists in the title of a literary work and a plaintiff or a complainant is not entitled to relief on such basis except in an action for passing off or in respect of a registered trademark comprising such titles. The Times of India has more.

The 'Dancing Baby' case is not over - with BOTH sides aiming for a rehearing: Whilst at the time of the appelate court's judgement, the EFF called it “an important win for fair use,” but now both the EFF (which is representing the plaintiff, Stephanie Lenz, who filmed her then toddler dancing to Prince's "Let's Go Crazy" ) and Universal Music Corp. have requested an en banc rehearing from the Ninth Circuit. It seems the EFF are looking to strengthe the case for 'fair use' by breathing new life in section 512(f), which allows the targets of illegitimate takedowns to sue the people who sent the invalid notices - potentially arguing that on the facts of this case, Universal could not possibly have acted in 'good faith' when issuing a DMCA takedown' notice  The Universal petition claims that Lenz had no standing for an appeal in the first place because she was not injured by the takedown. UMG will also ask the court to clarify some of the language in the opinion.

Jay Z at Glastonbury 2008 (Nick Cordes)

US district judge Christina Snyder has abruptly dismissed the lawsuit against Jay Z and his producer Timbaland before it went to a jury at a federal court in Los Angeles, ruling that Osama Ahmed Fahmy, the heir of an Egyptian composer Baligh Hamdy, lacked the right to pursue a copyright infringement claim against Jay Z's Big Pimpin in a case that looked at copyrights, moral rights and chain of title. After hearing from experts in Egyptian law, The judge ruled that Egyptian law did not apply and that the case should not go to a jury. “Fahmy lacked standing to pursue his claim. In light of that decision, it will not be necessary to submit to the jury whether Big Pimpin’ infringed Khosara Khosara,” she said. The plaintiffs have said they will file an appeal