UPDATE: New Filings in Garcia v. Google, "Innocence of Muslims" Dispute

Garcia v. Google involves an actress's claim of a copyright interest in her acting performance in the controversial film "Innocence of Muslims" and her request for a preliminary injunction requiring Google to take down the film.  The actress's request for injunctive relief was denied in the district court but on appeal, a divided panel of the Ninth Circuit reversed that denial and ordered Google and YouTube to "remove immediately all or part of [the] film entitled 'Innocence of Muslims' from its platforms worldwide and to prevent further uploads."  You can read about the Ninth Circuit's decision here.

After the Ninth Circuit's decision, a judge of that court sua sponte requested a vote on whether to rehear en banc the panel's decision denying Google's request for a stay of the orders requiring it to take down the film.  The court thus directed the parties to file supplemental briefing limited to that issue.  The court's order can be found here.

The parties filed their respective supplemental briefing on March 12, 2014.  You can read the brief of the actress, Cindy Lee Garcia, here.  Google's briefing can be found here.  Although I haven't completed review of both briefs, one interesting item attached to Google's brief is a letter from the U.S. Copyright Office dated March 6, 2014, explaining why the office was refusing the actress's attempt to register a copyright in her individual performance in the film.



Michael Jordan Defeats Supermarket's First Amendment Defense in Dispute Over Congratulatory Ad

In September 2009, Michael Jordan was inducted into the Naismith Memorial Basketball Hall of Fame, at which time Sports Illustrated produced a special commemorative issue of Sports Illustrated Presents devoted exclusively to his legendary career.  Jewel Food Stores--the operator of 175 supermarkets in and around Chicago--was offered and accepted free advertising space in the special issue in exchange for agreeing to stock the magazine.

Jewel's full-page ad appeared on the inside back cover of the issue and included a photo of a pair of basketball shoes bearing Jordan's number 23, with text appearing above congratulating Jordan on his accomplishments and incorporating Jewel's slogan, followed by Jewel's logo in large type (the Seventh Circuit's opinion includes a picture of the ad).

Jordan sued Jewel for, among other claims, violations of the Illinois Right of Publicity Act and the Lanham Act, all based on the allegation that Jewel had misappropriated his identity for its commercial benefit.  He sought $5 million in damages plus punitive and treble damages.

Both parties moved for summary judgment:  Jewel claimed that the ad was noncommercial speech protected by the First Amendment; Jordan claimed the ad was a commercial use of his identity.  The district court concluded that Jewel's ad was fully protected noncommercial speech and therefore entered judgment for Jewel on all of Jordan's claims.

Although it characterized the district court's decision as "thoughtful," the Seventh Circuit nonetheless held that the court had erred in concluding that Jewel's ad constituted fully protected noncommercial speech and therefore reversed on that basis.

Before reaching the substance of the appeal, the Seventh Circuit discussed one issue of law that the parties' agreement allowed the court to avoid resolving.  The parties apparently agreed with the proposition that the First Amendment precluded application of the laws upon which Jordan's claims were based to any noncommercial speech as defined in the constitutional sense, thereby providing a complete constitutional defense.  But the law on that issue is "considerably more complex," the Seventh Circuit commented, and it was "far from clear that Jordan's trademark and right-of-publicity claims fail without further ado" even if Jewel's ad constituted noncommercial speech.  Nonetheless, because the parties had agreed otherwise, that issue was left for another day.

Moving on to the central issue, the Seventh Circuit discussed the varying definitions or descriptions of "commercial speech," including "speech that proposes a commercial transaction."  But "commercial speech" is not limited to speech that falls within that narrow definition; rather, speech can still be characterized as "commercial" if it contains both commercial and noncommercial elements.  In such instances, the court identified three non-exclusive considerations:  whether "(1) the speech is an advertisement; (2) the speech refers to a specific product; and (3) the speaker has an economic motivation for the speech."

Applying these considerations to Jewel's ad, the Seventh Circuit rejected Jewel's argument that the ad wasn't commercial speech because it didn't propose any commercial transaction.  Rather, the text of the ad must be considered in its context as well as the context of modern commercial advertising:

We know from common experience that commercial advertising occupies diverse media, draws on a limitless array of imaginative techniques, and is often supported by sophisticated marketing research.  It is highly creative, sometimes abstract, and frequently relies on subtle cues. . . .  An advertisement is no less "commercial" because it promotes brand awareness or loyalty rather than explicitly proposing a transaction in a specific product or service. . . .  Very often the commercial message is general and implicit rather than specific and explicit.

Such was true with Jewel's ad, the Seventh Circuit concluded, because it sought both to congratulate Jordan and promote Jewel's supermarkets.  The latter purpose was demonstrated by the prominent use of Jewel's logo in the center of the ad in type larger than any other on the page, and the explicit incorporation of Jewel's slogan ("just around the corner") into the text of the congratulatory message:

In short, the ad's commercial nature is readily apparent.  It may be generic and implicit, but it is nonetheless clear.  The ad is a form of image advertising aimed at promoting goodwill for the [Jewel] brand by exploiting public affection for Jordan at an auspicious moment in his career.

Finally, the Seventh Circuit clarified the "inextricably intertwined" doctrine:

Properly understood, . . . the . . . doctrine applies only when it is legally or practically impossible for the speaker to separate out the commercial and noncommercial elements of his speech.  In that situation the package as a whole gets the benefit of the higher standard of scrutiny applicable to noncommercial speech.  But simply combining commercial and noncommercial elements in a single presentation does not transform the whole into noncommercial speech.

So clarified, the doctrine did not apply to Jewel's ad and Jewel's constitutional defense to Jordan's claims was defeated.

The case cite is Jordan v. Jewel Food Stores, Inc., Appeal No. 12-1992 (7th Cir. Feb. 19, 2014).

Ninth Circuit: No Presumption of Irreparable Harm For Preliminary Injunctions in the Trademark Context & No Cause of Action for Contributory Cybersquatting Under the ACPA

As I slowly work through a backlog of cases, there are two trademark related cases from the Ninth Circuit in the not-too-distant past that are worth at least brief mentions.

Herb Reed Enters., LLC v. Florida Entm't Mgmt., Inc., Appeal No. 12-16868 (9th Cir. Dec. 2, 2013):

The first case involved a dispute over the use of "The Platters" name belonging to the well-known musical group of the 1950s.  At issue in the Ninth Circuit appeal was the district court's grant of a preliminary injunction to one of the parties claiming ownership of "The Platters" mark.

The Ninth Circuit addressed a number of issues relating to the grant of the preliminary injunction but only one was an issue of first impression in the circuit, namely, whether a court can presume a likelihood of irreparable harm when a plaintiff establishes a likelihood of success on the merits of its trademark claim.

Under the Ninth Circuit's previous rule, "'irreparable injury [could] be presumed from a showing of likelihood of success on the merits of a trademark infringement claim.'"  But in light of two Supreme Court decisions issued after adoption of that rule--eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) and Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008)--the Ninth Circuit held that the rule no longer applies and a plaintiff must instead establish the likelihood of irreparable harm when seeking preliminary injunctive relief in the trademark context.


Petroliam Nasional Berhad v. GoDaddy.com, Inc., Appeal No. 12-15584 (9th Cir. Dec. 4, 2013):

 In the second case, the Ninth Circuit answered the question whether the Anticybersquatting Consumer Protection Act ("ACPA") recognized a claim for contributory cybersquatting.  Looking to the statutory language and the purpose of the ACPA, the Ninth Circuit held that a cause of action for contributory cybersquatting could not be read into the statute.

First, the Ninth Circuit concluded that the plain text of the ACPA did not support the creation of a cause of action for contributory cybersquatting because the text limited civil liability for cybersquatting to those who, with "bad faith intent to profit" from a protected mark, register, traffic in, or use a domain name.  As a result:

[e]xtending liability to registrars or other third parties who are not cybersquatters, but whose actions may have the effect of aiding such cybersquatting, would expand the range of conduct prohibited by the statute from a bad faith intent to cybersquat on a trademark to the mere maintenance of a domain name by a registrar, with or without a bad faith intent to profit.

Second, the Ninth Circuit rejected the argument that Congress incorporated the common law of trademark, including contributory infringement, into the ACPA, and therefore rejected previous cases that had relied on such reasoning to conclude that a cause of action for contributory cybersquatting existed.  One such case specifically cited by the Ninth Circuit is from the Western District of Washington, Microsoft Corp. v. Shah.  You can read the district court's opinion discussing that issue here.  (The case was dismissed with prejudice pursuant to the parties' stipulation in July 2011, apparently without any further substantive motions or decisions on the contributory cybersquatting claim.)

Specifically, the Ninth Circuit stated that the ACPA was not the result of a codification of the common law but rather created a new statutory cause of action to address the new problem of cybersquatting.  Therefore, the court declined to infer a theory of contributory cybersquatting into the ACPA based on the common law of trademarks.

Finally, the Ninth Circuit concluded that recognizing a cause of action for contributory cybersquatting would not further the specific problem Congress sought to fix in the ACPA, namely, the bad faith and abusive registration of marks as domain names.  The ACPA was narrowly tailored to fix this problem by limiting those who can be liable for cybersquatting, including imposing a bad faith requirement and a narrow definition of those who "use" a domain name.  As a result, imposing secondary liability on domain name registrars would undermine these limitations on liability, the court concluded.

The Ninth Circuit also recognized the significant difficulties third-party service providers like GoDaddy would face if there was a cause of action for contributory cybersquatting.  In short, the court concluded that mark owners already had sufficient remedies for cybersquatting under the ACPA without extending liability by "a judicially discovered cause of action for contributory cybersquatting."

Ninth Circuit Concludes That Trademark Registration Cancellation Claim Does Not Provide Independent Basis for Federal Jurisdiction

This isn't a case that's likely to draw you in with its tantalizing facts (at least as recited by the Ninth Circuit), so anyone interested in the facts can read the Ninth Circuit's short and fairly concise opinion.

But the Ninth Circuit did address an interesting question of law on which it admittedly had previously given "contrasting interpretations."  Specifically, the court addressed the question whether a trademark registration cancellation claim, standing alone, provides an independent basis for federal subject-matter jurisdiction.

The relevant language of the Lanham Act gives district courts "the power to order the cancellation of a trademark registration 'in any action involving a registered mark.'"  This language, the Ninth Circuit concluded, specified that cancellation is only available if there is already an action involving a registered mark.  In other words, agreeing with the other circuits that had addressed the question, "this statutory language . . . 'creates a remedy for trademark infringement rather than an independent basis for federal jurisdiction.'"  This conclusion also preserved actions before the PTO's Trademark Trial & Appeal Board "as the primary vehicle for cancellation," the court concluded.

The case cite is Airs Aromatics, LLC v. Victoria's Secret Stores Brand Mgmt., Inc., Appeal No. 12-55276 (9th Cir. Feb. 28, 2014).

Third Circuit Concludes That Courts Have No General Authority To Cancel Copyright Registrations

The Third Circuit recently addressed two issues of first impression in that circuit relating to two copyright issues:  (1) when an authorship claim arises and accrues; and (2) whether courts have authority to cancel copyright registrations.

Since the facts aren't necessary to the Third Circuit's answer to these questions--the rather long and somewhat involved facts are detailed in the court's opinion--I'm jumping right to the answers.

As to the first issue, the Third Circuit joined the Second, Seventh, and Ninth Circuits and adopted the "express repudiation" rule.  When that rule is fused with the discovery rule, which the Third Circuit follows in determining when a cause of action accrues, the court concluded that a copyright joint authorship claim arises "once a plaintiff's authorship has been expressly repudiated since he can only be on inquiry notice once his rights have been violated."  Again agreeing with its sister circuits, the Third Circuit also concluded that a copyright registration standing alone is insufficient to serve as the express repudiation of joint authorship.

As to the second issue, for several reasons, the Third Circuit held that courts do not have the general authority to cancel copyright registrations.  Most of the court's reasons were statutory-based.  For instance, the court noted that there is no language in the Copyright Act granting courts general authority to cancel copyright registrations.  To the contrary, the Act bestowed all administrative functions and duties on the Register of Copyrights except as otherwise specified.  Moreover, the court noted that one provision of the Act did bestow specific cancellation authority on courts with respect to "original designs," thus suggesting that the courts didn't have general cancellation authority.

The Third Circuit also noted that the Lanham Act explicitly provided courts with general authority to cancel trademark registrations.  Congress's failure to include such language in the Copyright Act with respect to copyright registrations thus suggested that it did not intend for courts to have general cancellation authority with respect to such registrations.

The Third Circuit concluded by emphasizing that the courts were not without authority to police copyright registrations or to invalidate copyrights:

It . . . goes without saying that courts are authorized to police copyright registrations through authorship claims and infringement claims. . . .

[W]e are in no way holding that courts are incapable of invalidating underlying copyrights.  While the two concepts are undoubtedly related, the distinction matters.  Holding that federal courts have the authority to cancel registrations would essentially be declaring that the judicial branch has the authority to order a legislative branch agency that is not a party to the litigation to take an affirmative action.  A federal court's finding that a copyright is invalid, on the other hand, is a determination of ownership which does not disturb the registration of a copyright.  Courts have no authority to cancel copyright registrations because that authority resides exclusively with the Copyright Office.

(Footnote omitted).

The case cite is Brownstein v. Lindsay, Appeal Nos. 12-2506 & 12-4471 (3d Cir. Jan. 29, 2014).


Ninth Circuit Orders Google To Remove "Innocence of Muslims" Film Based on Copyright Claim of Actress

This opinion from the Ninth Circuit has created quite a stir and for good reasons, some of which are touched upon below.

Cindy Lee Garcia was cast in a minor role for a film with the working title "Desert Warrior," which she was told was an adventure film set in ancient Arabia.  She received the four pages of the script in which her character appeared and was paid approximately $500 for three and a half days of filming.

But instead of being part of an Arabian adventure film, Garcia's scene (partially dubbed over) was used in the anti-Islamic film "Innocence of Muslims," which was posted on YouTube.  As a result of her role in the film, Garcia received death threats.  She took security precautions and filed multiple unsuccessful takedown notices under the Digital Millenium Copyright Act trying to get the video removed from YouTube.

Garcia filed a suit against Google and others (her amended complaint can be found here) and sought a temporary restraining order seeking removal of the film, claiming that posting the video infringed her alleged copyright in her performance in her scene.

The district court, treating Garcia's application as one for a preliminary injunction, denied it, concluding in part that she had delayed in seeking an injunction and that she was unlikely to succeed on the merits of her copyright claim because she gave the film's writer and producer an implied license to use her performance in the film.  The district court's short decision can be found here.

In an opinion written by Chief Judge Kozinski, to which Circuit Judge Smith dissented, the Ninth Circuit reversed the district court, remanding for that court to enter a preliminary injunction.  In the interim, the Ninth Circuit also issued a temporary injunction requiring Google to take down all copies of the film "from YouTube and any other platforms within its control and to take all reasonable steps to prevent further uploads."

In reversing the district court's denial of the preliminary injunction, the Ninth Circuit's majority opinion discussed two issues of particular interest:  Garcia's claim of a copyright interest in her performance in the film (apparently consisting of a single scene) and the nature of the alleged irreparable harm that would result if the injunction based on her copyright claim wasn't granted.

As to the first issue, the Ninth Circuit concluded that the film wasn't a joint work of which Garcia was a joint author under the Copyright Act.  But that didn't end the analysis because "a copyright interest in a creative contribution to a work [doesn't] simply disappear[] because the contributor doesn't qualify as a joint author of the entire work."  Instead, as the majority opinion saw it, because Garcia's "artistic contribution" (i.e., her acting performance in the scene) was fixed, "the key question remains whether it's sufficiently creative to be protectible."

The Ninth Circuit concluded that Garcia's performance was sufficiently creative, rejecting Google's argument that she didn't make a protectible contribution to the film because the writer/producer wrote the dialogue, managed the production, and dubbed over a portion of her scene.  The majority opinion characterized an actor's performance as "far more than speak[ing] words on a page," describing it as an "external embodiment" including "body language, facial expression and reactions to other actors and elements of a scene."

Relying on a Supreme Court opinion involving the copyrightability of telephone book white page listings, Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (1991), the Ninth Circuit--giving remarkably short shrift to a seemingly more complex question--concluded that Garcia's acting performance possessed the "minimal degree of creativity" necessary to be independently copyrightable.

 After reaching this potentially broad conclusion--albeit only for purposes of deciding the propriety of preliminary injunctive relief in this case--the majority opinion attempted to limit it, concluding that Garcia granted the film's writer/producer a broad implied license to use her performance in the film.  But despite emphasizing that such an implied license should be "construed very broadly," the use in this case exceeded the scope of the license by using it in the controversial "Innocence of Muslims" film when Garcia believed she would be appearing in an Arabian adventure film.

The second particularly interesting issue involved the requirement that Garcia demonstrate that irreparable harm would result if an injunction didn't issue.  And more specifically, because the requested injunctive relief was based on her copyright infringement claim, she had to show that the harm alleged "is causally related to the infringement of her copyright."

The harm Garcia alleged, however, were the death threats she received, and presumably would continue to receive, which the majority opinion concluded was sufficient to justify a preliminary injunction on her copyright infringement claim:

[The film's writer/producer's] unauthorized inclusion of her performance in "Innocence of Muslims" undisputedly led to the threats against Garcia.  Google argues that any harm arises solely out of Garcia's participation in "Innocence of Muslims" and not out of YouTube's continued hosting of the film.  But Garcia has shown that removing the film from YouTube will help disassociate her from the film's anti-Islamic message and that such disassociation will keep her from suffering future threats and physical harm.

But while death threats certainly are a type of harm and even ignoring any issues as to causation, the Ninth Circuit never addresses the question whether it is the type of harm that was intended to be addressed by copyright law, or whether copyright law is the appropriate vehicle to address such harm.

Moreover, the majority opinion gives no meaningful attention to Google's First Amendment prior restraint argument, simply stating that the "First Amendment doesn't protect copyright infringement."  In so doing, the opinion does not address the issue whether, by issuing an injunction requiring Google to take down the film and thereby stifling speech (even offensive, troubling speech), the injunction is contrary to the public interest.

The dissenting opinion--emphasizing that an abuse of discretion standard of review applied to the district court's decision--focuses largely on the majority opinion's conclusion that Garcia's acting performance was independently copyrightable, arguing that she did not "clearly have a copyright interest in her acting performance, because (1) her acting performance is not a work, (2) she is not an author, and (3) her acting performance is too personal to be fixed."

The dissenting opinion also takes issue with the majority opinion's analysis of the irreparable harm issue and notes the "public's interest in a robust First Amendment," an interest implicated by the injunction forcing Google to take down the film.

Whether one agrees or not with the dissenting opinion's reasoning on any or all of these issues, the opinion is well worth reading if only because it offers a more nuanced discussion of what would seem to be much more complex issues than is apparent from the majority opinion.

The case cite is Garcia v. Google, Inc., Appeal No. 12-57302 (9th Cir. Feb. 26, 2014).

California Court Concludes that First Amendment Provides Complete Defense to Publicity Rights Claim of Former Criminal Against Rapper

Plaintiff Ricky D. Ross is a former criminal who spent time in prison in connection with charges relating to cocaine trafficking.  He apparently gained some celebrity status as a result of "the enormous scale of his cocaine-dealing operations" and also received widespread coverage in the 1990s for a peripheral role in the Iran-Contra scandal.

Defendant William Leonard Roberts II is a former correctional officer turned apparently famous rapper who goes by the name "Rick Ross."  Although Roberts apparently referenced Ross's life story early in his career, Roberts denied that his performing name was based on plaintiff.  Roberts released his first commercial single in about 2005 and his lyrics often include references to running large-scale cocaine operations.

After a federal district court in California dismissed his federal claims and declined to exercise supplemental jurisdiction over his state law claims, Ross sued Roberts and other defendants in California state court alleging various state law claims all based on the allegation that Roberts had misappropriated Ross's name and identity to further Roberts's music career.

On defendants' motion for summary judgment, the trial court accepted defendants' statute of limitations argument, dismissing all of Ross's claims.  The appellate court affirmed that decision but on a different ground.

Specifically, although the issue was not argued in the trial court, the appellate court concluded that the First Amendment provided a complete defense to all of Ross's claims.

The court applied the "transformative test" adopted by the California Supreme Court to resolve conflicts between rights of publicity and rights of free speech and expression under the First Amendment.  As its name implies, the transformative test focuses on determining whether a work is transformative and specifically

looks at whether the celebrity likeness is one of the raw materials from which an original work is synthesized, or whether the depiction or imitation of the celebrity is the very sum and substance of the work in question.  We ask, in other words, whether a product containing a celebrity's likeness is so transformed that it has become primarily the defendant's own expression rather than the celebrity's likeness.

If the case presents a close question, the court also may make a subsidiary inquiry that asks "whether the marketability and economic value of the challenged work derive primarily from the fame of the celebrity."

The appellate court did not, however, find the facts of this case to present a close question, characterizing Roberts's First Amendment defense as "quite obvious."

We recognize that Roberts's work--his music and persona as a rap musician--relies to some extent on plaintiff's name and persona.  Roberts chose to use the name "Rick Ross."  He raps about trafficking in cocaine and brags about his wealth.  These were "raw materials" from which Roberts's music career was synthesized.  But these are not the "very sum and substance" of Roberts's work. . . .

    Roberts created a celebrity identity, using the name Rick Ross, of a cocaine kingpin turned rapper.  He was not simply an imposter seeking to profit solely off the name and reputation of Rick Ross.  Rather, he made music out of fictional tales of dealing drugs and other exploits--some of which related to plaintiff.  Using the name and certain details of an infamous criminal's life as basic elements, he created original artistic works.

The "subsidiary inquiry" of the transformative test only cemented the validity of the First Amendment defense for the appellate court, which concluded that it "defie[d] credibility to suggest that Roberts gained success primarily from appropriation of plaintiff's name and identity, instead of from the music and professional persona that he (and the other defendants) created."

The appellate court thus affirmed the trial court's grant of summary judgment in favor of the defendants.

The case cite is Ross v. Roberts, Appeal No. B242531 (Cal. Ct. App. Dec. 23, 2013).

Framing Issue on Appeal Narrowly, Second Circuit Avoids Copyright Issues in Copyright Infringement Claim Arising From Amended Pleading Filed in Class Action

Unclaimed Property Recovery Service (UPRS) and Bernard Gelb were among the named plaintiffs in a class action in which Norman Kaplan was the plaintiffs' attorney.  According to the allegations in the later copyright infringement suit, Gelb conducted the research for the class action complaint, hired Kaplan to represent the class, wrote the amended class action complaint, and compiled 305 pages of accompanying exhibits.  Gelb and UPRS also alleged that they had copyrights in the amended complaint and exhibits.

Kaplan signed and filed the amended complaint and exhibits on behalf of the class action plaintiffs.  The district court later dismissed the class action as time-barred and Kaplan appealed on the plaintiffs' behalf.

But while the appeal was pending, Kaplan and Gelb had a falling out, Kaplan informed Gelb that he wouldn't represent Gelb or UPRS, who then retained new attorneys.  Kaplan remained attorney of record for three other class action plaintiffs.

New counsel for Gelb and UPRS later moved to withdraw the pending appeal, which the Second Circuit granted but only as to them.  After that decision, Gelb and UPRS obtained copyright registration certificates for the amended complaint and exhibits.

The appeal proceeded with respect to the other class action plaintiffs and ultimately, the Second Circuit vacated the district court's dismissal of the action.

On remand, the class action plaintiffs still represented by Kaplan were granted leave to file a second amended complaint, which Kaplan did on their behalf.  Significant portions of this second amended complaint and exhibits were identical to portions of the first amended complaint and exhibits in which Gelb and UPRS claimed copyright.

Gelb and UPRS then sued Kaplan, alleging in part that he infringed their copyrights in the first amended complaint and exhibits by copying portions of those documents in the second amended complaint and exhibits that he filed.

The district court dismissed the copyright infringement claim concluding that Gelb and UPRS had granted Kaplan an irrevocable implied license to file amended versions of the first amended complaint and exhibits.  The court thus did not reach the question whether Gelb and UPRS had valid copyright interests in the first amended complaint and exhibits in the first instance.  The district court then declined to exercise supplemental jurisdiction over the state law claims for conversion and unfair competition.

Gelb and UPRS appealed.

The Second Circuit framed the issue narrowly in a way that avoided broader copyright questions:  "[W]hether the holder of a copyright in a litigation document who has authorized a party to a litigation to use the document in the litigation may withdraw the authorization after the document has already been introduced into the litigation and then claim infringement when subsequent use is made of the document in the litigation."

The Second Circuit answered that question in the negative, holding that "where the holder of a copyright in a litigation document has authorized a party to the litigation to use the document in the litigation, this constitutes an irrevocable authorization to all parties to the litigation (and to their attorneys, as well as the court) to use the documents thereafter in the litigation throughout its duration."

The court largely based its conclusion on practical considerations, noting that "[l]itigation cannot be conducted successfully unless the parties to the litigation and their attorneys are free to use documents that are a part of the litigation."

But the Second Circuit also questioned the plaintiffs' theory on policy grounds, stating that plaintiffs asked the court to endorse and enable "their questionable litigation practices" that would impinge on the trial court's discretionary case management authority by preventing it from allowing pleadings to be amended only in part.

In reaching its conclusion, the Second Circuit noted all the questions it (unfortunately) was not deciding:

Our decision today is based on the particularities of the facts before us.  We do not decide whether legal pleadings or other legal documents are subject to copyright law.  We do not decide whether a party who is authorized to file a legal pleading in one case is also authorized to file it in other cases.  We do not decide whether the parties to the litigation may use the pleading for other purposes unrelated to the litigation.

The court further qualified its conclusion by noting that it did "not mean to suggest that permission of the copyright holder is inevitably needed for use of a copyrighted document in litigation;" rather, its "ruling concern[ed] only the consequence of a grant of authorization for use in litigation which the holder then purports to withdraw."

The case cite is Unclaimed Prop. Recovery Serv., Inc. v. Kaplan, Appeal No. 12-4030 (2d Cir. Aug. 20, 2013).


A Single Line From a Faulkner Novel Paraphrased in a Woody Allen Movie Not a Copyright Infringement, Court Concludes on a Motion to Dismiss

At issue in this litigation was Woody Allen's movie, Midnight in Paris, and William Faulkner's book, Requiem for a Nun, or, more specifically, quotes from the movie and the book.

The quote from the book was:  "The past is never dead.  It's not even past."  The quote from the movie was:  "The past is not dead.  Actually, it's not even past.  You know who said that?  Faulkner, and he was right.  I met him too.  I ran into him at a dinner party."  (The district court's opinion provides significantly more description of the movie and the book.)

Faulkner Literary Rights, LLC sued Sony Pictures Classics for the use of the line in the movie, alleging violations of the Copyright Act and the Lanham Act.  Sony moved to dismiss the complaint, which the district court granted based on a fair use analysis that led to a finding of non-actionable de minimis use.

The district court began with a discussion of the proper point in the copyright infringement analysis to consider the issue of de minimis use, ultimately concluding that it, along with the question of substantial similarity, would be encompassed within its assessment of the four fair use factors.

As to the first fair use factor--the purpose and character of the use--the district court found (1) that the "speaker, time, place, and purpose of the quote in these two works are diametrically dissimilar;" (2) that the "[c]haracters in both works use the quote for antithetical purposes of persuasion;" and (3) that the "transmogrification in medium" from "a serious piece of literature" to a "speaking part in a movie comedy" favored fair use.  In short, Sony's use was transformative:

These factors coupled with the miniscule amount borrowed tip the scales in such heavy favor of transformative use that it diminishes the significance of considerations such as commercial use that would tip to the detriment of fair use.  It is difficult to fathom that Sony somehow sought some substantial commercial benefit by infringing on copyrighted material for no more than eight seconds in a ninety minute film.  Likewise, it is evident that this eight second clip serves as a thematic catharsis or apex in plot to neither Requiem nor Midnight.

The district court then concluded that the second fair use factor--the nature of the copyrighted work--was neutral and quickly moved on.

As to the third fair use factor--the substantiality of the portion used in relation to the copyrighted work as a whole--everyone was in agreement that from a quantitative standpoint, Sony's use was not substantial.

Instead, Faulkner urged that Sony's use was qualitatively important because the quote "'describes the essence of Requiem: there is no such thing as past[.]'"  But the district court rejected this argument, finding that it addressed "the qualitative importance of a theme" in the book "not the qualitative importance of the quote itself," which was the issue.  Thus, from both a quantitative and qualitative standpoint, the court concluded this factor too favored a finding of fair use.

Finally, with respect to the fourth fair use factor--the use's effect upon the potential market for or value of the copyrighted work--the district court noted that the record was silent.  Nonetheless, it found this factor "to be essentially a non-issue in light of the stark balance" of the factors favoring Sony and because it "is highly doubtful that any relevant markets have been harmed" by Sony's use.  Indeed, the court expressed a certain amount of incredulity on this point:  "How Hollywood's flattering and artful use of literary allusion is a point of litigation, not celebration, is beyond this court's comprehension."

Thus, ultimately, the court concluded "that no substantial similarity exists between the copyrighted work and the allegedly infringing work, and Sony's use . . . was de minimis," making the use not actionable.

The district court also gave short shrift to Faulkner's Lanham Act claim noting that it had not identified the specific provision(s) of the Act that Sony allegedly violated. 

Nor did the court find persuasive Faulkner's allegations that the movie would deceive or confuse viewers "'as to a perceived affiliation, connection or association between William Faulkner and his works, on the one hand, and Sony, on the other hand.'"  Although the movie alluded to Faulkner, "[a]llusion is not synonymous with affiliation, nor with appropriation," the court stated, and Faulkner had not demonstrated "that the mere use of a celebrity name in an artistic work somehow rises to the level of deception."

Finally, having dismissed Faulkner's federal claims, the district court declined to exercise supplemental jurisdiction over its remaining claim for commercial misappropriation under state law.

The case cite is Faulkner Literary Rights, LLC v. Sony Pictures Classics Inc., Case No. 3:12-cv-00100-MPM-JMV (N.D. Miss. July 18, 2013).


Fourth Circuit Upholds Copyright Assignment Effectuated by Agreeing to Terms of Use Containing Assignment Provision

The parties to this case--Metropolitan Regional Information Systems and American Home Realty Network--are competitors in the real estate listing business.

Metropolitan Regional operates a listing service compiling property listings and related information.  Paying subscribers upload their real estate listings, including photos, to Metropolitan Regional's database.  To submit photos, subscribers must click a button assenting to Metropolitan Regional's Terms of Use Agreement which included a provision irrevocably assigning the copyrights in the photos to Metropolitan Regional.

Metropolitan Regional sued American Home Realty for copyright infringement for using Metropolitan Regional's photographs on its own real estate listings website.

Metropolitan Regional sought a preliminary injunction and American Home Realty moved to dismiss on various grounds.  The district court granted the motion for a preliminary injunction and denied the motion to dismiss.  American Home Realty appealed and the Fourth Circuit affirmed.

The only issues on appeal involved the validity of Metropolitan Regional's copyright registrations with respect to the photos (which were registered as component parts of a database) and its ownership of the copyrights in the photos.

As to the first issue, the Fourth Circuit noted a divide among courts. 

Some courts have barred infringement suits with respect to component works like Metropolitan Regional's photos, concluding that the registrations failed to comply with the requirement that authors of the component works be listed in the application to register the collective work.

But other courts have concluded otherwise, "at least so long as the registrant owns the rights to the component works as well."  The Fourth Circuit found this latter approach "more consistent with the statutory and regulatory scheme" and concluded that Metropolitan Regional's infringement suit with respect to its photos was not barred.

The second issue was somewhat more interesting.  American Home Realty argued that the subscriber's electronic agreement to Metropolitan Regional's TOU, which contained a copyright assignment provision, was insufficient to assign rights under Section 204 of the Copyright Act, which requires a signed writing.

But the Fourth Circuit rejected that argument and instead agreed with Metropolitan Regional's contention that an electronic transfer satisfies the Copyright Act's requirement of a signed writing.  Both the court and Metropolitan Regional also relied on the Electronic Signatures in Global and National Commerce Act ("the E-Sign Act") to support that conclusion.

The E-Sign Act states that an electronic signature cannot be denied legal effect simply because it is electronic and defines "'electronic signature'" as "'an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.'"

The Fourth Circuit noted that the only case relying on the E-Sign Act in the context of copyright assignments upheld the conveyance of a copyright interest by email.  See Vergara Hermosilla v. Coca-Cola Co., Case No. 1:10-cv-21418-KMM (S.D. Fla. Feb. 23, 2011).  It also relied on other decisions in which courts had held that "agreements reached by electronic means" were not invalid under analogous statutory requirements.

Thus, the Fourth Circuit held "that an electronic agreement may effect a valid transfer of copyright interests under Section 204 of the Copyright Act."

Although it was not raised by the parties, before launching into this discussion of ownership, the Fourth Circuit "note[d] the anomaly of allowing [American Home Realty] to fabricate for its own benefit a dispute between [Metropolitan Regional] and its subscribers over copyright ownership in the photographs."  Nonetheless, the Fourth Circuit went on to address the issue of ownership.

The case cite is Metro. Reg'l Info. Sys., Inc. v. Am. Home Realty Network, Inc., Appeal No. 12-2102 (4th Cir. July 17, 2013).