recent developments in copyright la inc. v. aereo, inc. and wnet, thirteen, fox television stations,...

© 2011

Recent Developments in

Copyright Law

Kevin Meek

Partner, Intellectual Property

Baker Botts L.L.P.

Austin, Texas

Topics Today

Supreme Court

Streaming TV

Fair Use

Google

Porn Troll

Sampling

This just in…

Supreme Court

Supreme Court on First Sale

Supreme Court took Kirtsaeng v. John Wiley &

Sons, Inc. to resolve a circuit split

Foreign-made products can be resold in U.S. . . .

never (2nd Circuit) (national exhaustion)

sometimes (9th Circuit)

owner approves prior sale in U.S.

always (3rd Circuit) (int'l exhaustion)

Second Sale

Manufacture

First Sale

Kirtsaeng v. Wiley, Majority Opinion (Breyer)

Result: decided 6-3 to reverse 2nd Circuit,

International Exhaustion now the law for

copyright

Key issue: determining what "lawfully made under

this title" means

Reasons for opinion

Similarity with Quality King

Literal reading of language

Statutory context

Parade of Horribles

Response to Arguments

Part of Quality King was dicta

Dividing markets wasn't protected

Kirtsaeng v. Wiley, Dissent (Ginsburg)

Agrees Quality King statement was dicta, but

would follow that statement

Plain meaning of "under"

Includes 3 sections in her analysis

106 (right of distribution); 109 (first sale doctrine); 602

(unauthorized importation)

Section 602

Under majority opinion,

loses any weight

history favors her view

US international stance

Parade of horribles is fake

Kirtsaeng v. Wiley, Concurring Opinion

Justice Kagan

It wasn't me! Don't misinterpret this statute because

Quality King was bad...

Justice Jockeying

Old School (e.g. Ginsburg)

"Although Justice Kagan's concurrence suggests that

Quality King erred in [its holding,] that recent unanimous

holding must be taken as a given."

New School (e.g. Kagan)

"[The dissent] would swap one

(possible) mistake for a

much worse one."

Kirtsaeng to extend to Patents?

Supreme Court denied cert in Ninestar

Technologies

Still may wade in at some point

Many expect Federal Circuit to revisit the issue

Specialists on both sides of guessing where Fed.

Cir. may go

Take direction from Supreme Court?

Yeah, right

Fed. Cir. often takes pro-patent stance

Raging Circuit Split -

Laches v. Statute of Limitations

Supreme Court will hear Petrella v. MGM

17 U.S.C. § 507(b) prescribes a three-year

statute of limitations for copyright claims

Circuit split over whether the defense of laches

can bar a copyright claim filed within copyright

law's three-year statute of limitations.

Three circuits: No laches defense available

Two circuits: Laches restricted to exceptional

circumstances only

One circuit: Presumption in favor of applying laches to

continuing copyright infringements

Streaming TV

Aereo Streaming TV Service

Encoder

ABC, Inc. v. Aereo, Inc. and WNET, Thirteen, Fox

Television Stations, Inc. v. Aero, Inc.

3/1/2012 - Suits filed against

Aereo in NY Federal Court

7/11/2012 - District court

denied preliminary injunction

based decision on Cablevision

case (stated that without that

case in place, would have

granted injunction)

11/30/2012 - Oral argument at

2nd Circuit seeking to

overturn decision denying

preliminary injunction

Majority:

Affirms district court

Considers the first prong of preliminary injunction

"likelihood of success"

Is Aereo's service a public performance?

No. Similar to Cablevision for two key reasons

Unique copies

No one else could see copy

Stare Decisis

Dissent

Different from Cablevision

Aereo has no license

Viewers could already see content in an authorized way

ABC, Inc. v. Aereo, Inc. (2nd Cir.)

ABC, Inc. v. Aereo, Inc. - The Aftermath

ABC sought En Banc review - denied

5/6/2013 - Aereo files DJ action against CBS to

prevent copyright suits in other jurisdictions

10/10/2013 - Massachusetts federal judge denied a

preliminary injunction against Aereo

10/11/2013 - ABC filed cert petition at Supreme

Court

Present - Fox now arguing violation of fair use

provision

Commercial competition between Aereo and Fox

No volitional conduct by Aereo subscribers when using

"Watch Now" feature.

Alki David started the "technologically analogous"

service to Aereo in California, Aereokiller (now

known as FilmOn)

The four major US TV networks sued FilmOn in

federal court, moved for preliminary injunction

Judge Wu granted the preliminary injunction

9th Cir. law says infringe

2nd Cir. not binding,

but limits scope of injunction

DC District Court granted preliminary injunction

nationwide . . . except 2nd Circuit

Fox Television Stations Inc. v. Aereokiller LLC

Dish ... Ad-Skipping and Streaming

Dish - Ad-Skipping

March 2012, Dish launched new service that

included an ad-skipping feature

TV Networks filed for preliminary injunction

Judge Gee denied motion

Found that networks unlikely to succeed

on merits for most claims

Quality control copies could infringe but

de minimis

Affirmed by 9th Circuit

9th Circuit reviewed fair use factors and

found ad-skipping to be fair use

Fox has requested en banc review

Dish - Streaming Video

The Hopper also allows a user to stream their

shows to mobile devices

Has a feature to make copies of the recorded

shows on mobile devices to take and watch where

internet is not available

Fox pushed for preliminary injunction (2/22/2013)

Dish said Fox knew of concept when agreement

was made

District court refused to grant injunction

Fair Use

Fair Use as a Defense

Statutory Factors - 17 U.S.C. § 107

1. Purpose and Character of Use

Second most important

2. Nature of the Copyrighted Work

3. Substantiality of the Portion Used

4. Effect on the Potential Market

Most important

SOFA Entertainment Inc. v. Dodger Productions, Inc.

Broadway musical Jersey Boys used clip from Ed

Sullivan Show introducing the Four Seasons

District Court found fair use at summary judgment

and granted attorneys' fees

9th Circuit Affirmed

Work is transformative (Cites to Elvis case)

Nature of work is factual (who is performing)

Amount taken was minimal; cannot copyright Ed

Sullivan's charisma

Not a substitute in market for original clip

SOFA should have known better

Why? It was a two-time loser!

Cariou v. Prince

Patrick Cariou published a book, Yes Rasta, of

classical portraits he took during his six years

spent living among Rastafarians in Jamaica

Photos were "extreme classical photography [and]

portraiture"

Book was 9.5" x 12"

Richard Prince took some of the photos from

Cariou's book and incorporated them into a

variety of pieces of artwork in an exhibit called

Canal Zone

Many were hodge-podges of various works, including

several provocative works

On a very large scale (10-100x larger than book page)

Cariou v. Prince

Cariou v. Prince - District Court

District court found that Prince's work infringed

Cariou's copyright in the photographs

District court standard: use must "comment on,

relate to the historical context of, or critically refer

back to the original works"

District court applied wrong fair use standard

"[A] new work must generally alter the original

with 'new expression, meaning or message.'"

Own observations show transformative use of 25

of 30 works as matter of law

Don't care what Prince said, what

a "reasonable observer" would think

Points to composition, presentation,

scale, color palette, and media

Remanded last 5 to district court

Cariou has appealed to Supreme Court

Cariou v. Prince - 2nd Cir. Majority Opinion

Judge Wallace (sitting by designation from 9th

Circuit) dissented

Agreed with nearly all legal arguments of majority

Should remand all, not decide 25 and send 5 back

Should listen to evidence of what

Prince said

South Park was procedurally

weird, and parody, should not

extend the case this far

"[This judgment call] would be

extremely uncomfortable for me to

do ... in my appellate capacity, let

alone my limited art experience."

Cariou v. Prince - Dissent

Copyright Infringement by Patent Firms

Four patent firms sued by academic

publishers for providing articles to

the patent office

Claim for infringement for providing the

articles to the PTO dropped

Claimed infringement for internal firm

use

Decisions in 3 of 4 cases

Winstead - won (N.D. TX)

Schwegman - won (D. MN)

Hovey Williams - voluntarily dismissed

(D. KS)

MBHB - pending (N.D. IL)

Fair Misuse?

Between the Lines v.

Lions Gate

Entertainment

Lions Gate accused of using Twilight copyrights to

squelch fair use by independent filmmakers,

parodists and other artists

Claims

Sham cease-and-desist notices

Prohibited trademark and service mark registrations

Between the Lines says their parody film was fair use of

the Twilight material

$500M lawsuit - Clayton Act claim

Google Books

2004 - Google begins scanning books in earnest

2005 - Copyright lawsuits filed against Google

2008 - Settlement reached, rejected

2010 - Settlement amended

2011 - Settlement rejected

2012 - Author class certified - appealed

2013 - 2nd Cir. decertified class

First consider whether scanning was fair use before

certifying class

2nd Cir. hinted that deciding fair use would decide the

case

HathiTrust Case

Not Google but related

Book scanning for purpose of making books

searchable deemed fair use by district court

2nd Cir. appeal pending

YouTube

YouTube v. Viacom

On remand, district court again found that YouTube

was protected by DMCA (April 2013)

Viacom has appealed

Viacom wants a new judge this time around

Judge used a "perverse" approach

Lessig v. Liberation Music Party Ltd.

Copyright misuse suit for removing Lessig's lecture

from YouTube

Pending in D. Mass.

Porn Trolling

PHE, Inc v. Does 1-105

PHE, the parent of Adam & Eve, brought suit

against 105 Doe defendants for downloading

"Buffy the Vampire Slayer XXX: A Parody" via

BitTorrent

Judge dropped 104 of the Does

No judicial economy, only overlap is copyrighted

work involved and

how work accessed

Many defendants with

varied defenses

See also Safety Point

Productions v. Does

Ingenuity13 LLC v. John Doe

Series of companies (AF Holdings, LLC, Ingenuity

13, LLC, etc.) acquire porn films and monitor

BitTorrent, sue on screenshot of downloading

Always run by the same 5 lawyers, various law

firms and business entities

Would file law suits and try and get settlement

around $4k (including pressure by posting name

on Anti-Piracy Law Group page

if no rapid settlement)

Simply copy and paste court

documents, including discovery

responses

Ingenuity13 LLC v. John Doe

Judge Otis D. Wright II was not happy

Refused to let case go away, instead

ordered to show why no sanctions

Rule 11

Lack of investigation into infringement

Lack of investigation into infringer's identity ("an old-

fashioned stakeout may be in order")

Local Rule 83-3

Failure to comply with

discovery order

Fraud on the court

Calling Alan Cooper?

Ingenuity13 LLC v. John Doe

After hearing, orders sanctions (order 5/6/2013)

Under findings of fact

"attorneys with shattered law practices"

"stole the identity of Alan Cooper" (groundskeeper)

Sanctions

No Rule 11 Sanctions, using inherent authority

Sanctions for $80k (just below cost of appeal)

Referring lawyers to bars

Referring matter to US Attorney

for RICO investigation and to IRS

Appealed to 9th Cir., fined $7k/day

sanctions not paid (5/22/2013)

Ingenuity13 LLC v. John Doe

What happens to trolls

Prenda partner claims poverty, can't pay share of

the sanctions

Prenda dissolved (July 26)

Ordered to pay more attorneys' fees

and court costs in July

Copycat - Malibu Media v. Doe

Federal judge in Wisconsin sanctioned

Malibu for using adult films that it didn't own to "harass

and intimidate" alleged downloaders into agreeing to

settlements.

Sampling

Sampling is infringement

Two district court cases in the 90's established

that sampling is infringement

Grand Upright Music v. Warner Bros.

Sampling is willful infringement

Jarvis v. A&M Records

Focused analysis on whether

the copying is substantial

enough to constitute improper

appropriation of the copyrighted

work

Sampling Defenses

Fair Use

Campbell v. Acuff-Rose

Sampling for parody can be fair use

Bridgeport Music v. UMG

No fair use, even though the use was transformative and

the scope of use was small

De Minimis

Newton v. Diamond

6-second, 3-note sample

Sampling was de minimis and not actionable.

Bridgeport Music v. Dimension Films

4- second, 3-note sample

No de minimis inquiry for sampling cases - it's

infringement!

Upcoming interesting sampling cases

VMG Salsoul v. Madonna

New argument: the claimed sample (single horn chord,

0.2-seconds) was not copyrightable - no originality

Pending in C.D. Cal.

TufAmerica v. Diamond

Another de minimis defense

1-second and a 3-second samples

Pending in S.D.N.Y.

This just in!

Quick review of some new

topics

Smart phone jailbreaking

Transformative use

Scope of the public domain

Lawyers and copyright holders

behaving badly

Cell Phone Unlocking

Unlocking cell phones used to be covered by an

exemption to the DMCA

Librarian of Congress removed the exemption

earlier this year

Washington is scrambling to fix it

Unlocking Technology Act of 2013

White House petition response

FCC private deal

Commerce Department petition to FCC

Midnight in Copyright Law

Faulkner estate sued Sony over a reference to a

Faulkner quote in Midnight in Paris

District court ruled the use transformative and a

fair use and dismissed the claim

It's not so elementary, my dear Watson

Klinger v. Conan Doyle Estate

At issue: when some works that establish a character

and world are in the public domain but others are not,

what is the extent of the copyright protection?

Author has filed a declaratory judgment action to have

most of the Sherlock Holmes canon declared public

domain.

Pending in the N.D. IL

Please sue me!

"Has anyone had any experience with McMorris

cpas White Zuckerman churning or over billing?"

Attorney claims breach of privacy, CFAA, and

copyright infringement for another atty copying

his one sentence comment on a message board.

District Judge Gee

dismissed suit

9th Circuit found against

him on all claims

Now he has filed a cert petition

at the Supreme Court

Even Kung Fu won't save this case

An artist accused Dreamworks of copying his idea

for Kung Fu Panda

Case was dropped

Artist used a Lion King coloring book as inspiration

Shredded evidence

One final note about Fair Use

This presentation is fair use.

Fair use factors - 17 U.S.C. § 107

Purpose and character of the use, including whether

such use is of a commercial nature or is for nonprofit

educational purposes

Nature of the copyrighted work

Amount and substantiality of the portion used in relation

to the copyrighted work as a whole

Effect of the use upon the potential market for or value

of the copyrighted work.

Except for this:

"Has anyone had any experience with McMorris cpas

White Zuckerman churning or overbilling?"

Kevin Meek 512.322.5471

kevin.meek@bakerbotts.com