Friday’s Endnotes – 02/22/19

By , February 22, 2019.

An Empirical Study of Transformative Use in Copyright Law — How dominant has the transformative use inquiry become in fair use analysis since its introduction? And what effect has it had on shaping fair use outcomes? Law professor Jiariu Liu assembled a set of all reported transformative use decisions through 2017 to see what the data tell us.

The Investment Firm That Commissioned Wall Street’s ‘Fearless Girl’ Is Suing the Artist for Making Replicas — A teaching moment for artists who create works for others to understand what rights they retain for those works (and to determine in advance of any agreement what rights they may want to retain). Also another teaching moment for reading the actual complaint rather than relying on headlines. The complaint alleges only several breach of contract claims. That includes breach of both trademark and copyright agreements in the contract, but no allegations of trademark or copyright infringement per se. Of course, the question going forward is to what extent are any of the contract claims actually copyright infringement claims and/or preempted by the Copyright Act. A good law school exam hypo.

‘Fortnite’ Law Firm Reports Someone Tried to End Dance Lawsuits With Fake Emails — A bit of drama this week in the ongoing litigation involving claims the popular video game incorporated protectable dance moves without authorization. Variety reports that an email that appeared to originate from the plaintiffs’ law firm was sent to the US Copyright Office, asking it to reject its copyright claims.

Studios Sue Omniverse in TV Streaming Crackdown — On the heels of a successful settlement with streaming device maker Dragon Box, studios have sued Omniverse, alleging the company serves as a “hub” for feeding unauthorized content to other illegal streaming services.

Friday’s Endnotes – 10/27/17

By , October 27, 2017.

Above: Author T. J. Stiles delivers the keynote address at the Center for Protection of Intellectual Property’s Fall Conference, October 13, 2017.

Music Creators See Big Tech Earning Billions While ‘Strip-Mining Artists’ Work’: Guest Op-Ed — Musician and president of the Content Creators Coalition Melvin Gibbs writes, “The tech platforms wrap themselves in claims about free speech or internet censorship, but in the end they oppose measures to reduce pirated music and other creative works because that would hurt their bottom line.”

Another Season, Another Common-Law Copyright Opinion — Zvi Rosen writes about yesterday’s Florida Supreme Court decision finding that pre-1972 sound recording owners do not have a common law public performance right in Florida. The question came to the court after the Eleventh Circuit certified it as part of a lawsuit between the Turtle’s Flo & Eddie and Sirius XM Radio.

Internet “entrepreneur” shocked that copyright owner sued him for stealing their work — Also believes that all photographers do is put their photos online to trick people into copying them just so they can sue them.

Supreme Court De-na-na-na-na-na-na-na-na-nies Batmobile Appeal

By , April 11, 2016.

Last month, the Supreme Court denied review of a cert petition in DC Comics v. Towle, regarding whether the Batmobile can be protected by copyright. This in itself isn’t news—the Supreme Court only grants roughly 5% of all petitions it receives. But the subject matter of this litigation brought a fair amount of attention, so let’s take a quick look at last September’s Ninth Circuit decision, which now stands.

This litigation begins, as the court recounts, with defendant Mark Towle, who runs a business called Gotham Garage. Among other things, his business sells replicas of the Batmobile, as depicted in the 1966 television show and 1989 motion picture. He also sells kits which allow customers to modify their cars to look like these Batmobiles. DC Comics, the publisher of comics featuring Batman, sued Towle for copyright infringement, trademark infringement, and unfair competition for manufacturing and selling the replica Batmobiles. Both parties moved for summary judgment, and in a 2013 order, the district court granted summary judgment in favor of DC Comics on the copyright claim, finding that the Batmobile “was a character entitled to copyright protection.” On appeal, the Ninth Circuit affirmed, concluding that “the Batmobile character is the property of DC, and Towle infringed upon DC’s property rights when he produced unauthorized derivative works of the Batmobile.”

Under the Copyright Act, copyright protection subsists in works.117 U.S. Code § 102. But courts have long held that characters can be independently protected by copyright.2Rice v. Fox Broad. Co., 330 F.3d 1170, 1175 (9th Cir. 2003); Warner Bros. Inc. v. Am. Broad. Cos., 720 F.2d 231, 235 (2d Cir. 1983); 1 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 2.12 (2015) (“Although there has been some conflict in the cases, it is clearly the prevailing view that characters per se are entitled to copyright protection.” (footnotes omitted).). It’s worth noting that trademark protection for characters may overlap with copyright protection for characters. See Jane C. Ginsburg, Licensing Commercial Value: From Copyright to Trademarks and Back 2-3 (Colum. Law Sch. Ctr. for Law and Econ. Studies, Working Paper No. 516, 2015); Kathryn M. Foley, Protecting Fictional Characters: Defining the Elusive Trademark-Copyright Divide, 41 Conn. L. Rev. 921, 939 (2009). Courts that have found characters independently copyrightable have done so when “the character appropriated was distinctively delineated in the plaintiff’s work,”3Salinger v. Colting, 641 F. Supp. 2d 250, 254 (S.D.N.Y. 2009), vacated on other grounds, 607 F.3d 68 (2d Cir. 2010) (quoting 1 Nimmer, supra note 16, § 2.12). or are “‘especially distinctive’ or the ‘story being told.’”4Rice, 330 F.3d at 1175. Examples include Amos ‘n’ Andy,5Silverman v. CBS Inc., 632 F. Supp. 1344, 1355 (S.D.N.Y. 1986), aff’d in part, vacated in part, 870 F.2d 40 (2d Cir. 1989). James Bond,6Metro-Goldwyn-Mayer, Inc. v. Am. Honda Motor Co., 900 F. Supp. 1287, 1296 (C.D. Cal. 1995). Betty Boop,7Fleischer Studios, Inc. v. A.V.E.L.A., Inc., 772 F. Supp. 2d 1135, 1147 (C.D. Cal. 2008). Freddy Krueger,8New Line Cinema Corp. v. Bertlesman Music Grp., 693 F. Supp. 1517, 1521 n.5 (S.D.N.Y. 1988). Godzilla,9Toho Co. v. William Morrow & Co., 33 F. Supp. 2d 1206, 1216 (C.D. Cal. 1998). Holden Caulfield from Catcher in the Rye,10Salinger, 641 F. Supp. 2d at 266. Jonathan Livingston Seagull,11Bach v. Forever Living Prods. U.S., Inc., 473 F. Supp. 2d 1110, 1118 (W.D. Wash. 2007). Scarlett O’Hara and Rhett Butler from Gone with the Wind, Tom and Jerry,12Warner Bros. Entm’t v. X One X Prods., 644 F.3d 584, 597 (8th Cir. 2011). Walt Disney’s Mickey Mouse and Donald Duck,13Walt Disney Prods. v. Air Pirates, 581 F.2d 751, 757-58 (9th Cir. 1978). and characters from The Wizard of Oz.14Warner Bros. Entm’t, 644 F.3d at 597.

The fact that the Batmobile is an inanimate object and not a sentient being doesn’t prevent this protection. Courts have recognized that copyright could protect characters such as “Eleanor,” a 1967 Shelby GT-500 appearing in Disney’s 2000 film Gone in 60 Seconds, and Freddy Krueger’s glove.15Halicki Films, LLC v. Sanderson Sales & Mktg., 547 F.3d 1213, 1225 (9th Cir. 2008); New Line Cinema Corp. v. Russ Berrie & Co., 161 F. Supp. 2d 293, 302 (S.D.N.Y. 2001).

The most important question facing the Ninth Circuit was whether the Batmobile could be protected as an independent character despite not having a consistent appearance in all works. The car that appeared in the 1966 television show, after all, looked quite different from the car in the 1989 motion picture. But the court did not find this an impediment to copyright protection. It observed that “district courts have determined that James Bond, Batman, and Godzilla are characters protected by copyright, despite their changes in appearance.” And in each instance, it said,

[C]ourts have deemed the persistence of a character’s traits and attributes to be key to determining whether the character qualifies for copyright protection. The character “James Bond” qualifies for copyright protection because, no matter what the actor who portrays this character looks like, James Bond always maintains his “cold-bloodedness; his overt sexuality; his love of martinis `shaken, not stirred;’ his marksmanship; his `license to kill’ and use of guns; his physical strength; [and] his sophistication.” Similarly, while the character “Godzilla” may have a different appearance from time to time, it is entitled to copyright protection because it “is always a pre-historic, fire-breathing, gigantic dinosaur alive and well in the modern world.”

Having reviewed the existing precedent, the Ninth Circuit synthesized a three-part test for determining when a character like the Batmobile, which may span multiple works and vary in appearance, can be independently protected by copyright.

First, the character must generally have “physical as well as conceptual qualities.” Second, the character must be “sufficiently delineated” to be recognizable as the same character whenever it appears. Considering the character as it has appeared in different productions, it must display consistent, identifiable character traits and attributes, although the character need not have a consistent appearance. Third, the character must be “especially distinctive” and “contain some unique elements of expression.” It cannot be a stock character such as a magician in standard magician garb. Even when a character lacks sentient attributes and does not speak (like a car), it can be a protectable character if it meets this standard.

The Ninth Circuit then applied this test to the Batmobile, and concluded that the Batmobile met the standard. Its “bat-like appearance” is a consistent theme throughout its appearances in comics, movies, and television shows, making it recognizable as the same character whenever it appears. The character displays consistent, identifiable character traits and attributes; says the court, “No matter its specific physical appearance, the Batmobile is a ‘crime-fighting’ car with sleek and powerful characteristics that allow Batman to maneuver quickly while he fights villains,” and it “always contains the most up-to-date weaponry and technology.” Finally, the court found the Batmobile to be “especially distinctive,” noting “it is not merely a stock character.” Having established that the Batmobile is protected by copyright, it was short work to conclude that Towle’s Batmobile replicas infringed on DC’s copyright.

The Ninth Circuit’s holding is consistent with longstanding business practices. Many derivative works, like sequels or tie-ins, rely on the same characters but share no other similarities in terms of plot or expression of existing works.16Benjamin A. Goldberger, How the “Summer of the Spinoff” Came to Be: The Branding of Characters in American Mass Media, 23 Loy. L.A. Ent. L. Rev. 301, 302 (2003) (“Characters are central to the most common types of recycling and reuse in the entertainment business.”); see also 1 Nimmer, supra note 16, § 3.04[A]. As DC has done with the Batmobile and other Batman characters, it is common practice to license characters for use in new works.17See, e.g., Burroughs v. Metro-Goldwyn-Mayer, Inc., 683 F.2d 610, 611-12 (2d Cir. 1982) (involving license granting rights to produce original story with the character Tarzan); Fleischer Studios, 772 F. Supp. 2d at 1140 (referencing agreement that transfers interest in, inter alia, “all characters contained therein”). Such practices rely upon certainty, so having courts provide consistent and stable rules facilitates beneficial economic and cultural activities with these characters.

References

References
↑1 17 U.S. Code § 102.
↑2 Rice v. Fox Broad. Co., 330 F.3d 1170, 1175 (9th Cir. 2003); Warner Bros. Inc. v. Am. Broad. Cos., 720 F.2d 231, 235 (2d Cir. 1983); 1 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 2.12 (2015) (“Although there has been some conflict in the cases, it is clearly the prevailing view that characters per se are entitled to copyright protection.” (footnotes omitted).). It’s worth noting that trademark protection for characters may overlap with copyright protection for characters. See Jane C. Ginsburg, Licensing Commercial Value: From Copyright to Trademarks and Back 2-3 (Colum. Law Sch. Ctr. for Law and Econ. Studies, Working Paper No. 516, 2015); Kathryn M. Foley, Protecting Fictional Characters: Defining the Elusive Trademark-Copyright Divide, 41 Conn. L. Rev. 921, 939 (2009).
↑3 Salinger v. Colting, 641 F. Supp. 2d 250, 254 (S.D.N.Y. 2009), vacated on other grounds, 607 F.3d 68 (2d Cir. 2010) (quoting 1 Nimmer, supra note 16, § 2.12).
↑4 Rice, 330 F.3d at 1175.
↑5 Silverman v. CBS Inc., 632 F. Supp. 1344, 1355 (S.D.N.Y. 1986), aff’d in part, vacated in part, 870 F.2d 40 (2d Cir. 1989).
↑6 Metro-Goldwyn-Mayer, Inc. v. Am. Honda Motor Co., 900 F. Supp. 1287, 1296 (C.D. Cal. 1995).
↑7 Fleischer Studios, Inc. v. A.V.E.L.A., Inc., 772 F. Supp. 2d 1135, 1147 (C.D. Cal. 2008).
↑8 New Line Cinema Corp. v. Bertlesman Music Grp., 693 F. Supp. 1517, 1521 n.5 (S.D.N.Y. 1988).
↑9 Toho Co. v. William Morrow & Co., 33 F. Supp. 2d 1206, 1216 (C.D. Cal. 1998).
↑10 Salinger, 641 F. Supp. 2d at 266.
↑11 Bach v. Forever Living Prods. U.S., Inc., 473 F. Supp. 2d 1110, 1118 (W.D. Wash. 2007).
↑12 Warner Bros. Entm’t v. X One X Prods., 644 F.3d 584, 597 (8th Cir. 2011).
↑13 Walt Disney Prods. v. Air Pirates, 581 F.2d 751, 757-58 (9th Cir. 1978).
↑14 Warner Bros. Entm’t, 644 F.3d at 597.
↑15 Halicki Films, LLC v. Sanderson Sales & Mktg., 547 F.3d 1213, 1225 (9th Cir. 2008); New Line Cinema Corp. v. Russ Berrie & Co., 161 F. Supp. 2d 293, 302 (S.D.N.Y. 2001).
↑16 Benjamin A. Goldberger, How the “Summer of the Spinoff” Came to Be: The Branding of Characters in American Mass Media, 23 Loy. L.A. Ent. L. Rev. 301, 302 (2003) (“Characters are central to the most common types of recycling and reuse in the entertainment business.”); see also 1 Nimmer, supra note 16, § 3.04[A].
↑17 See, e.g., Burroughs v. Metro-Goldwyn-Mayer, Inc., 683 F.2d 610, 611-12 (2d Cir. 1982) (involving license granting rights to produce original story with the character Tarzan); Fleischer Studios, 772 F. Supp. 2d at 1140 (referencing agreement that transfers interest in, inter alia, “all characters contained therein”).

Copyright and Trade

By , April 22, 2015.

Last Thursday, Senators Hatch and Wyden and Representative Ryan introduced the Bipartisan Congressional Trade Priorities and Accountability Act of 2015, commonly referred to as Trade Promotion Authority, or TPA. The bill provides a mechanism for Congress to establish negotiating objectives for US trade negotiators and is considered essential to concluding major agreements in the works such as the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP). A hearing was held Tuesday by the Senate Finance Committee, and a markup is scheduled for today.

The US Constitution splits authority for entering into trade agreements between Congress and the Executive Branch. 1Article I accords the President the “Power, by and with the Advice and Consent of the Senate, to make Treaties” and Congress the power “To regulate Commerce with foreign Nations.” TPA enables both to exercise their power in an efficient and effective manner.

For decades, US trade agreements have included provisions concerning copyright and other forms of intellectual property. Through the proposed TPA, Congress would provide, in part, that

The principal negotiating objectives of the United States regarding trade-related intellectual property are — to further promote adequate and effective protection of intellectual property rights, including through —

  • ensuring that the provisions of any trade agreement governing intellectual property rights that is entered into by the United States reflect a standard of protection similar to that found in United States law;
  • providing strong protection for new and emerging technologies and new methods of transmitting and distributing products embodying intellectual property, including in a manner that facilitates legitimate digital trade;
  • preventing or eliminating discrimination with respect to matters affecting the availability, acquisition, scope, maintenance, use, and enforcement of intellectual property rights;
  • ensuring that standards of protection and enforcement keep pace with technological developments, and in particular ensuring that rightholders have the legal and technological means to control the use of their works through the Internet and other global communication media, and to prevent the unauthorized use of their works;
  • providing strong enforcement of intellectual property rights, including through accessible, expeditious, and effective civil, administrative, and criminal enforcement mechanisms;
  • and preventing or eliminating government involvement in the violation of intellectual property rights, including cyber theft and piracy.

Though copyright has been the subject of international agreements for well over a century, its presence in trade fora is more recent, dating back to the 1980s. Given the increased attention to trade related issues of copyright sure to come over the next several weeks, I thought it would be helpful to sketch a very brief overview of how copyright and other intellectual property rights became a part of the trade agenda.

A brief history of US trade policy

In the US, the issue of import duties was the very first order of business taken up by the First Congress. After establishing its own rules of operation, Virginia Representative James Madison on April 8, 1789, told the other members of the House that the subject “requires our first attention.” 2Annals of Congress, House of Representatives, 1st Congress, 1st Session, pg. 107 (April 8, 1789). He added that he believed Congress should pursue regulation “as free as the policy of nations will permit.”

For nearly a century and a half, tariffs were the primary instruments of trade policy.3Ian F. Fergusson, Trade Promotion Authority (TPA) and the Role of Congress in Trade Policy, Congressional Research Service (2015). During that time, the concept of “free trade” began to develop further, with the help of economists such as Adam Smith, David Ricardo, and James Mill. Essentially, the policy is premised on the prediction that when barriers to trade between two countries are reduced or eliminated, producers and consumers in both countries benefit.

However, following World War I, the pendulum swung back to protectionism. The US passed the Smoot-Hawley Tariff Act in 1930, setting high tariff rates that led to retaliatory measures by major trading partners, a drop in international trade and a prolonging of the Great Depression.4Fergusson. Within four years, the US reversed course and set on a path of trade liberalization, which it continues to this day.

Internationally, the General Agreement on Trade and Tariffs, the first multilateral forum for trade negotiations, was established in 1947. The initial focus was on tariff reductions, but over time, negotiations began to consider non-tariff trade barriers.5Fergusson.

IP and trade

Beginning in the early 1980s, both the Executive and Legislative branches began to recognize trade-related aspects of intellectual property protection.

The private sector played a key role in getting the issue on the agenda. As a task force on intellectual property within the Advisory Committee for Trade Negotiations (a group made up of private sector representatives who provided input to US trade negotiators) noted in a 1986 report

The growing economic importance of intellectual property to all industries and the inadequacies of the present IP system—both at the international and national levels—have led the U.S. private sector to seek a trade-based response, as a supplementary tool to deal with the resultant distortion of international trade flows.

After detailing several specific problems that could be addressed through a trade-based approach, the task force urged that, at this point in time, “the basic concept of a trade approach to IP must be recognized and its legitimacy accepted by the IP community.”

In 1985, a Presidential Commission on Industrial Competition called for placing a higher priority on trade policy, including “a new round of GATT negotiations to achieve some coverage for trade in services and agriculture, foreign governments targeting and tax policies, countertrade, protection of intellectual property, and nontariff barriers.”6Report of the President’s Commission on Industrial Competitiveness, hearing before the Subcommittee on Economic Stabilization of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, Ninety-ninth Congress, first session, March 5, 1985.

President Reagan gave a major policy speech that following September on trade. In it, Reagan laid out principles for his trade agenda, making specific note of intellectual property. For example, he observed, “Above all else, free trade is, by definition, fair trade. When domestic markets are closed to the exports of others, it is no longer free trade. When governments subsidize their manufacturers and farmers so that they can dump goods in other markets, it is no longer free trade. When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade.” He later explained, “I have instructed the United States Trade Representative to accelerate negotiations with any and all countries where the counterfeiting and piracy of U.S. goods has occurred to bring these practices to a quick end. And I look forward to working with the Congress to increase efforts to protect patents, copyrights, trademarks, and other intellectual property rights.”

The speech described the foundations of the Administration’s trade agenda. The Joint Economic Committee Subcommittee on Trade, Productivity and Economic Growth heard from Administration officials in March 1986 about Executive Branch efforts to address “International Piracy Involving Intellectual Property.” Alexander Good, Director General, US and Foreign Commercial Service, Department of Commerce, explained that, among these efforts, the Administration was looking at multilateral action through GATT, to “have a code across the board on patents, trademarks, copyrights, and unfair trading practices.”

Next month, the Administration released a statement on the protection of US intellectual property rights abroad. It said that foreign infringement “severely distort[s] international trade and deprive[s] innovators, creators and inventors of rewards and opportunities that are rightfully theirs.”7Office of the United States Trade Representative, Administration Statement on the Protection of U.S. Intellectual Property Rights Abroad, April 7, 1986. It went on to note several reasons why IP protection was important not just to the US but also to its trading partners and the global economy as a whole:

  • Adequate and effective protection fosters creativity and know-how, encouraging investment in research and development and in new facilities.
  • Innovation stimulates economic growth, increases employment and improves the quality of life.
  • Technological progress is a critical aspect of US competitiveness as well as freer and fairer global trade.
  • In developing countries, improved intellectual property protection can foster domestic technologies and attract needed foreign know-how and investment.

Congress was also active during this period, with the Senate Committee on Finance and House Committee on Foreign Affairs holding hearings focusing on intellectual property rights aspects of trade during 1986.8Intellectual Property Rights, S. Comm. Finance (May 14, 1986); Status of Intellectual Property Protection, H. Comm. on Foreign Affairs (July 31, 1986).

Proponents were successful in getting the issue on the radar of negotiators when the eighth round of GATT talks began in September 1986 in Uruguay. When they concluded in 1994, the contracting parties had negotiated the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), introducing IP rules into the multilateral trading system for the first time. TRIPs was built around several key principles, including “national treatment (treating one’s own nationals and foreigners equally), and most-favoured-nation treatment (equal treatment for nationals of all trading partners in the WTO).” The Agreement establishes minimum standards of protection and enforcement for signatories to adhere to. It also makes the settlement of disputes concerning the provisions of the Agreement subject to the WTO’s dispute settlement process.9TRIPs Article 64.

Beginning with the 1994 North American Free Trade Agreement (NAFTA), the US has also sought IP provisions through bilateral and plurilateral free trade agreements. The latest was the US-Korea Free Trade Agreement, which entered into force in 2012. The US is seeking similar provisions as it negotiates TPP. The USTR says,

The provisions that the United States is seeking — guided by the careful balance achieved in existing U.S. law — will promote an open, innovative, and technologically-advanced Asia-Pacific region, accelerating invention and creation of new products and industries across TPP countries, while at the same time ensuring outcomes that enable all TPP countries to draw on the full benefits of scientific, technological, and medical innovation, and take part in development and enjoyment of new media, and the arts.

Given their increasing importance to economic growth and innovation, copyright and other IPRs will no doubt continue to play a vital role in trade policy.

References

References
↑1 Article I accords the President the “Power, by and with the Advice and Consent of the Senate, to make Treaties” and Congress the power “To regulate Commerce with foreign Nations.”
↑2 Annals of Congress, House of Representatives, 1st Congress, 1st Session, pg. 107 (April 8, 1789).
↑3 Ian F. Fergusson, Trade Promotion Authority (TPA) and the Role of Congress in Trade Policy, Congressional Research Service (2015).
↑4 Fergusson.
↑5 Fergusson.
↑6 Report of the President’s Commission on Industrial Competitiveness, hearing before the Subcommittee on Economic Stabilization of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, Ninety-ninth Congress, first session, March 5, 1985.
↑7 Office of the United States Trade Representative, Administration Statement on the Protection of U.S. Intellectual Property Rights Abroad, April 7, 1986.
↑8 Intellectual Property Rights, S. Comm. Finance (May 14, 1986); Status of Intellectual Property Protection, H. Comm. on Foreign Affairs (July 31, 1986).
↑9 TRIPs Article 64.

Friday’s Endnotes – 10/31/14

By , October 31, 2014.

I got a rock.

Charlie Brown (1966).

Old Masters — A fantastic series of vignettes from the New York Times Magazines of individuals over the age of 80, many of them artists and craftspeople, who are still hard at work.

Will Google finally admit search a factor in online piracy? — This is the question Ellen Seidler asks of the search giant, which had long maintained that search was not a factor in online piracy. However, after a recent tweak in its algorithm to downgrade sites receiving large numbers of DMCA takedown requests, traffic to those sites has plummeted.

Taking Pictures: A Way for Photographers to Protect Their Work — The New Yorker profiles photojournalist Yunghi Kim, who over the years has documented events and conflict in places like Somalia, Rwanda, Kosovo, and Iraq, and who has seen first hand the damage online infringement causes to photographers trying to bring these photos to the public.

No Lemonade for Aereo’s Lemons — Devlin Hartline looks at the recent decision involving streaming service Aereo, enjoined by a court that rejected its latest argument that it was a “cable service” under the Copyright Act and thus eligible for a compulsory license (immunizing it from copyright liability).

Copyright at Common Law in 1774 (via the 1709 Blog) — An important contribution to the history of copyright. Tomas Gomez-Arostegui presents a compelling case that the “revisionists” who’ve argued in recent decades that a seminal decision in 18th century England held copyright was solely a creature of statute are wrong.

Back to the Future Wouldn’t Have Been the Same Without Spielberg — The film might have been called “Spaceman from Pluto”, for one thing.

Friday’s Endnotes – 02/21/14

By , February 21, 2014.

The political conflicts and ambitions of [Shakespeare’s] England are known to the scholar and the specialist. But his plays will forever move men in every corner of the world. The leaders that he wrote about live far more vividly in his worlds than in the forgotten facts of their own rule.

Our civilization, too, will survive largely in the works of our creation. There is a quality in art which speaks across the gulf dividing man from man, nation from nation and century from century. …

[I]t is important to know that the opportunity we give to the arts is a measure of the quality of our civilization. It is important to be aware that artistic activity can enrich the life of our people; which is the central object of government. It is important that our material prosperity liberate and not confine the creative spirit.

—President Johnson, at the groundbreaking ceremony for the John F. Kennedy Center for the Arts on December 2, 1964. 1As quoted in Copyright Law Revision Pt. 6, Supplementary Report of the Register of Copyrights on the General Revision of the U.S. Copyright Law: 1965 Revision Bill, xiv (1965).

National Endowment for the Arts, Sunil Iyengar, on “Why The Arts Really Do Mean Business” — Check out this podcast with Copyright Alliance’s Sandra Aistars and National Endowment for the Arts Sunil Iyengar on the NEA’s recent report showing the arts and culture sectors contribute over half a trillion dollars to U.S. GDP and create nearly 2 million jobs.

‘Grindhouse’ to ‘John Carter’ – 18 ‘dream projects’ that turned into nightmares — An interesting article in its own right, though I was struck in particular by the author’s remarks that, “The best art comes from dealing with the limitations under which something is produced, and when all of those limitations are taken away, you can end up with something that is wall-to-wall indulgence.” and “The lesson to take away is that when you want to pay tribute to the guys who came before you, do it in a way like Lucas and Spielberg did with Indiana Jones. Take that energy and channel it into something of your own”

New report says how much advertising is going to piracy sites — $227 million in 2013. And, according to the report, a significant chunk of that is coming from dozens of “blue-chip advertisers”, major brands like “AT&T, Lego, and Toyota.”

‘House of Cards’ Searches on Google Turn Up Pirate Links as Top Results — Variety reports, “In a Google search for “Watch House of Cards” on Wednesday, the top two results were links to apparent pirate sites, couchtuner.eu and stream-tv.me.” That reminds me of the story about Charlie Chaplin entering a Charlie Chaplin look-alike contest and coming in third.

Utah Judge Gives TV Broadcasters an Injunction Against Aereo — Although the Supreme Court has already agreed to determine the liability of the internet streaming TV service, the Utah court heard and granted a motion to enjoin Aereo in a parallel proceeding. Said the judge, “Aereo’s retransmission of Plaintiffs’ copyrighted programs is indistinguishable from a cable company.”

Kim Dotcom raid warrants legal, Court of Appeals rules — Despite continual proclamations of innocence, Dotcom has done nothing but delay having his day in court. Here, a New Zealand court strikes down one such attempt.

Wikipedia: as accurate as Britannica? — A 2005 study has given rise to the gospel that Wikipedia is as accurate as Encyclopedia Britannica. Here, Andreas Kolbe points out the sharp limitations of that study. “Nicholas Carr put it this way: in limiting itself to topics like the ‘kinetic isotope effect’ or ‘Meliaceae’, which no one without some specialized understanding of the subject matter would even be aware of, the Nature survey played to Wikipedia’s strengths. Carr also established that the Nature ‘study’ was not actually an expert-written research article of the type that built the reputation of Nature, but a non-peer-reviewed piece of news journalism (a fact he confirmed with the piece’s author, Jim Giles).”

References

Review: Fast Forward: Hollywood, the Japanese, and the VCR Wars, by James Lardner

By , January 16, 2014.

All cultures have their fables: simplistic stories, perhaps inspired by historical events, that serve to convey a moral lesson. There is no grey area in fables; they present a binary right/wrong view that serves to solidify the bonds of the group.

One of the primary fables of copyright’s skeptics is the story of the Supreme Court’s Betamax decision. In the late 70s, Sony introduced a device that could hook up to a television and record shows for later viewing. “Hollywood” sued Sony—because they hate innovation, arrgh! The studios lost the case, but, in spite of this, the home video market ended up being a major revenue source for them. The moral of the story: copyright owners oppose any new technologies at their own peril.

It’s a simplistic (and vastly inaccurate) tale. The real story is far more nuanced and interesting, one that is expertly told by New Yorker writer James Lardner in his 1987 book, Fast Forward: Hollywood, the Japanese, and the VCR Wars. With the 30th anniversary of the Betamax decision tomorrow, I thought it would be timely to offer a review of book, readily available at libraries and used book stores.

After a brief introduction setting the stage for the Supreme Court case, Lardner rewinds to post-WWII Japan, where Masaru Ibuku and other employees of a company that had supplied precision military equipment moved back to Tokyo to rebuild from the ashes, literally (Lardner describes how Ibuku “had to send scavenging parties out into the country side for rice and vegetables.”) Ibuku partnered with tinkerer Akio Morita to form Tokyo Tsushin Kogyo—later, Sony—in 1946. The two set their sights on the consumer electronics market, gravitating toward tape recording, a recent development from Germany. The company soon began to pursue the development of transistors as well.

Over the next several chapters, Lardner traces the pursuit of a portable way to record and playback audio and video, a pursuit that occurred over several decades and multiple continents. The tinkerers in Japan were joined by similarly driven individuals and companies in the US and Europe; the pursuit was at times cooperative and at times competitive; and progress happened both incrementally and through innovative leaps. As Lardner points out throughout this discussion, the challenges were not only technological but commercial—surely there would be a market for recorded video… but as with any new technology, development of a market is often a chicken and egg problem. The recounting here demonstrates these points through efficient narrative.

Contrary to the refrain of copyright opponents, the creative industries did not sit idly by until the introduction of the Betamax, then spring into full-on active resistance. Fast Forward details how by the mid 1960s, for example, CBS was engaged in R&D to develop EVR: electronic video recording. A decade before Betamax, news magazines were predicting a future of home movie viewing. By 1970, Twentieth Century-Fox was experimenting with releasing a library of films on EVR cartridges. In a few years, Sears began selling and distributing “Cartrivision”, a console system that could play video cartridges—and record television programs. Several film studios licensed their titles, making over 300 available for sale or rental by 1972. But, as Lardner reveals, Cartrivision was not yet ready for primetime. The technology was too novel to catch on, technical glitches slowed adoption, and the business model for the hardware had one too many kinks (for example, the cartridge player was only sold as part of a television console, a tough sell at a time when replacing televisions wasn’t something consumers did too often).

When Sony finally unveiled its Betamax unit in 1976, it didn’t suffer these problems. It was a standalone unit, the technology had improved, and the nationwide advertising campaign succeeded in selling consumers on the features and benefits, particularly the ability to record off the air.

We next shift to the beginning of the litigation, which, it may surprise you if you’ve only heard the copyright skeptic version, only involved two studio plaintiffs: Universal and Disney. The trial covered many issues we would expect to hear today: were copyright owners being harmed by this technology, was Sony purposely encouraging infringement, could the technology be designed to mitigate unauthorized copying. But the court would clear Sony of any liability.

Lardner next provides historical and legal context about copyright law for the reader. What emerges is the fact that while the technological or business changes that the Betamax brought may have been predictable, the legal implications were not. Lardner says of the lower court decision, “For the first time a court had ruled that copying for mere entertainment or convenience was fair use, that copying of a whole work could qualify, and that individual copiers could gain immunity from the law simply by committing their offenses in a noncommercial setting, while frankly commercial interests—the suppliers of the machines involved—could profit as much as they liked. Finally, and most ominously, the decision suggested that infringement wasn’t really infringement unless the victim could prove economic harm.”

Here Lardner quotes from a lecture by then federal register of copyrights David Ladd:

The glory of copyright is that it sustains not only independent, idiosyncratic, and iconoclastic authors, but also fosters daring, innovative, and risk-taking publishers. . . . Copyright supports a system, a milieu, a cultural marketplace which is important in and of itself. . . . It does not ‘give’ the author or the publisher anything. It cloaks in legal raiment the undoubted right. It does not guarantee success, or audience, or power, or riches. It is not a warranty, but an invitation to risk. When the rewards are large, we should not resent or envy, but rejoice, and we should likewise cherish every miserable failure.

Then, five years after the lawsuit was filed, the Ninth Circuit reversed and found Sony liable for copyright infringement, though the precise question of remedies—damages, an injunction, something else, or some combination of these—was returned to the lower court for determination. Proceedings were stayed once the case was appealed to the Supreme Court.

But Sony began falling behind in the market because of stiff competition. It wasn’t long before everyone and their brother were selling home video player/recorders, despite the unsettled risk of liability. The technology was a disruption of the way movie studios had been operating, and each studio responded differently. As noted earlier, there were continued experiments in offering pre-recorded films directly to consumers, other studios were holding out hope for a (nonrecordable) home videodisc system in development.

Twentieth-Century Fox was signing deals to provide home videotapes within months of the Betamax’s introduction. They were joined soon by Viacom and a number of smaller and independent copyright owners. By the early 80s, all the studios were offering films for home rental and sale—and, indeed, home rental was exploding as an industry. It was only by this point that the MPAA got involved in the issue. Following the Ninth Circuit decision, the trade association began a push for a royalty on VCRs and blank tapes in Congress, the idea being to immunize device manufacturers from copyright claims while compensating copyright owners for the infringement that such devices facilitated. The MPAA’s involvement wasn’t a foregone conclusion; as noted, some studios were already engaged in the home video market.

At the same time, the consumer electronics industry sprung into high gear. Here we see the emergence of the copyright skeptic crowd, a loose confederation of consumer electronic manufacturers, content distributors, and consumer groups. And from here, things escalated. Lardner takes us through the Supreme Court arguments, the (unlikely) reargument, and the push for Congressional action in the wake of the Supreme Court’s reversal of the Ninth Circuit that absolved Sony of any copyright liability. The money was flowing into lobbyists and trade associations on both sides. This was the time of Jack Valenti’s infamous “Boston Strangler” remark, but it was also the time of political cartoons about jack-booted video police breaking into Americans’ living rooms to stop home recording; the hyperbole was equally distributed.

In the end, no legislation addressing the Supreme Court’s Betamax decision passed. The home video market had long been born, but so too had the copyright skeptic movement. Lardner recalls talking to Dale Snape, one of the film industry’s consultants during the Betamax case at this point:

He [Snape] wondered if it had been “a personal failing on my part that I cannot seem to bring people to the conclusion that the consumer’s stake comes before the time when he is paying for something—that it comes when choices are being made about what he can choose among to buy. It is personally very sad for me,” he said, “that groups like the Consumer Federation of America and Consumers Union look at these proposals in a hostile way.” He was in awe of the electronics industry’s ability to persuade people that “because they sell to consumers, they ipso facto represent consumers. The leap of faith you have to make,” he said, “is just staggering! The Consumer Product Safety Commission exists because of concern about manufacturers.”

This is an incredible book. Lardner has talked to a wide cross-section of participants in this moment of history and has gotten some candid and thorough responses. He weaves his research into an engaging narrative that does justice to the events and the issues. This is not only a good read but an important documentation of Betamax. Given the importance of the case to modern U.S. copyright jurisprudence, I think this book ranks as a must-read for any copyright nerd.

There are some who would say that the lesson of Betamax—or at least the fable version—is that the Copyright Act should be construed to favor tech companies over artists and creators. “When ‘technological change has rendered its literal terms ambiguous, the Copyright Act must be construed in light of this basic purpose’, and courts should be ‘reluctan[t] to expand the protections afforded by the copyright without explicit legislative guidance,'” writes academic David Post in a recent article about Aereo. Thirty years later, not too many people continue to use Betamax players—in fact, Betamax had lost most of its market share before the Supreme Court had even endorsed its legality. But they do still enjoy films such as Rocky or Taxi Driver (both released the same year the Sony litigation began). A policy that favors Betamax’s over the creation of films like that seems short-sighted and ultimately detrimental to all—including the manufacturer of the next Betamax.

Friday’s Endnotes – 10/18/13

By , October 18, 2013.

Here’s why isoHunt deserved to die — “Critics warned that the vagueness of [the Grokster] rule would open the floodgates to frivolous lawsuits against technology innovators. But that hasn’t happened for a simple reason: It’s easy to avoid running afoul of the inducement standard. If an entrepreneur is sincerely not trying to profit from infringement, then she won’t encourage her customers to infringe, and so plaintiffs won’t be able to find evidence of her doing so. In contrast, the court found clear evidence that isoHunt was trying to profit from infringement. For example, the 9th Circuit Court of Appeals wrote that for a time, ‘isoHunt prominently featured a list of ‘Box Office Movies,’ containing the 20 highest-grossing movies then playing in U.S. theaters. When a user clicked on a listed title, she would be invited to ‘upload [a] torrent’ file for that movie.’ Since the top-grossing movies are almost always copyrighted, this feature shows clear evidence of infringing intent.”

My Art Was Stolen for Profit (and How You Can Help) — Independent artist Lisa Congdon writes of her discovery that wholesaler Cody Foster appears to have “blatant[ly]” copied her artwork. Says Congdon, “In the world of art & illustration, you can use the artwork of artists on your products as long as you ask permission, sign a licensing agreement with the artist, and agree to compensate them. I sell my images to companies all the time, companies who ask my permission and compensate me for my intellectual property. In this case, I was never contacted, asked permission or paid. That is called copying. It’s also called stealing.”

Is unauthorized online copying theft and does it hurt creators? — Canadian attorney Barry Sookman points to an interesting case that addresses a subject that is vigorously debated online. It’s an interesting case: essentially, Party A engages in copying a database compiled by Party B without permission. Party B posts angry messages about Party A online, accusing Party A of being a “thief” and of stealing the database. A sues B for defamation. Truth is a defense to defamation. So the court had to consider whether the characterization of unauthorized copying as theft is true or false. it concluded that it was true. “To a lay person such as Henry, ‘theft’ can also mean the wrongful act of taking the property of another person without permission. The data Henry had collected could be reasonably understood as her property—she had collected it, and it was her work in compiling it that gave it value. She did not give Tamburo permission to copy it and sell access to it. Although Henry might not be able to successfully sue Tamburo for using her data in this way, the gist of her statements was true: he took the data without her permission.”

Musicians: Don’t Let Google Hijack Your Brand With “Shared Endorsements” — The announcement this week that Google will start using user photos and likenesses in advertising raised a stir. Fortunately, at the moment, it appears that Google users can opt out of becoming unpaid shills (though how long Google will allow that is unclear). Probably a good idea for not just musicians, but any creators and small businesses who use Google to promote their work.

You are a soldier in Google’s Cold War with Facebook for social dominance — Web.Tech.Law takes a closer look at why Google has made the above-mentioned move.

The Walking Dead: Season 4 Begins — If, like me, you were excited to see the return of AMC’s zombie drama last Sunday, you might enjoy this look at the creation of the music for the season premiere from Bear McCreary, who regularly blogs, in depth, about his creative process. Fascinating stuff.

Tollbooths and Newsstands on the Information Superhighway — Brad Greenberg has posted a draft of an interesting forthcoming essay. “The Internet has made it easier than ever before to stay informed on current events — and without ever needing to pick up, let alone pay for, a newspaper. But recent litigation and legislation in the United States and Europe have challenged the cost-free flow of such information. The opposition to these recent legal developments is rooted in a belief that stronger intellectual property protections result in higher tolls, which, in turn, price many consumers out of accessing and using the information. But overlooked has been an existential consideration: information-gathering is expensive, and absent efficient tolls there will be far less information to access at all, regardless of cost. The United States Supreme Court recognized this principle in Harper & Row Publishers, Inc. v. Nation Enterprises as it applies more narrowly to whether copyright law inhibits free expression. Identifying the particular importance of incentives for newsgatherers, this Essay extends the Harper & Row rationale beyond its copyright mooring. In light of the continued withering corps of professional newsgatherers, these legal developments actually could enhance the exchange of information and ideas to the extent they preserve incentives for news publishers. This Essay proffers that copyright expansions actually can increase access and thereby serve important copyright and First Amendment values.”