IP Law Chat : IP Law Chat -- Hendricks & Lewis, intellectual property, trademark, copyright and technology attorneys

In February 2007, Stephanie Lenz videotaped her young children dancing in the family's kitchen while a song, "Let's Go Crazy" by Prince, played in the background.  Lenz uploaded the 29 second video to YouTube.  (Although the song purportedly can be heard for about 20 seconds of the video, I have to admit that I could hear very little of it because of the admittedly "poor sound quality" and the sounds the children were making as they pushed toys around the family's kitchen.)

Universal then sent a takedown notice pursuant to Section 512 of the DMCA to YouTube, which stated in part that Universal had a "good faith belief" that the video "is not authorized by the copyright owner, its agent, or the law."  In response, YouTube took down the video although it was re-posted approximately six weeks later after Lenz sent a DMCA counter-notification.

Lenz then sued Universal for several claims, two of which were dismissed upon Universal's first motion to dismiss.  Lenz then filed an amended complaint that asserted a single claim under Section 512(f) of the DMCA that Universal "knowingly materially misrepresent[ed]" that the home video of her dancing children infringed Universal's copyright in the Prince composition.  Specifically, Lenz asserted that her use of the song was a "self-evident non-infringing fair use" under the Copyright Act and that Universal's DMCA notice stating to the contrary was an actionable misrepresentation under Section 512(f) of the DMCA.

Although Universal claimed that "it [was] time for this case to be over," the Court apparently did not agree and denied Universal's motion to dismiss the amended complaint.

Essentially, Universal argued that (1) it did not send a DMCA notice because, although it was sent to the email address dedicated to such notices and contained all the necessary elements of a DMCA notice, Universal apparently "does not agree that YouTube is eligible for protection under the DMCA's 'safe harbors,'"; (2) there was no knowing misrepresentation because fair use is an affirmative defense to otherwise infringing conduct; (3) fair use is never "self-evident" because of its "fact-specific, equitable nature"; and (4) as a fact-specific matter, Lenz's use was not "self-evidently" a fair use.  (As a side-note, it seems problematic for Universal to be claiming that it can and does make legal and factual conclusions about whether YouTube is "eligible for protection under the DMCA's 'safe harbors'" but cannot be expected to consider the fair use doctrine.)

Stating as a fact that Universal did send a DMCA notice to YouTube, the Court characterized the issue before it as follows:  "whether 17 U.S.C. [Section] 512(c)(3)(A)(v) requires a copyright owner to consider the fair use doctrine in formulating a good faith belief that 'use of the material in the manner complained of is not authorized by the copyright owner, its agent, or the law.'"  Noting that the Copyright Act expressly provides that "fair use of a copyrighted work . . . is not an infringement of copyright," the Court concluded that the copyright owner must consider the fair use doctrine in evaluating its "good faith belief that use of the material in the manner complained of is not authorized by . . . the law."  Thus, the Court concluded that an allegation that the copyright owner acted in bad faith by issuing a takedown notice without consideration of the fair use doctrine is sufficient to state a misrepresentation claim under Section 512(f) of the DMCA.

You can find the Court's opinion here (PDF, 10 pages), and for an interesting read, the parties' lengthy briefing on the motion here (PDF, 24 pages), here (PDF, 28 pages) and here (PDF, 18 pages).

 

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In a remarkably lengthy decision, the First Circuit reversed the grant of a preliminary injunction in a trademark case concluding that the phrase "duck tour" was generic for the parties' services and that the District Court's conclusion to the contrary was clear error.

The case pitted the plaintiff--Boston Duck Tours--against its competitor Super Duck Tours.  On Boston Duck Tours' motion for a preliminary injunction, the District Court concluded that the phrase "duck tours" was non-generic based entirely on a dictionary definition of "duck" that did not include any reference to DUKWs (amphibious army vehicles used in World War II) or amphibious vehicles.  The District Court thus enjoined Super Duck Tours from using the phrase "duck tours" or a cartoon duck (both parties used a cartoon duck in water as part of their design marks) as a trademark in connection with its tour service in the greater Boston area.

The First Circuit reversed the grant of a preliminary injunction based largely on its conclusion that the District Court erred in finding the phrase "duck tours" to be non-generic.  In reaching this conclusion, the First Circuit looked to evidence overlooked by the District Court, including third-party sources that used the phrase "duck tours" generically to refer to amphibious sightseeing tours and Boston Duck Tours' own generic use of the phrase "duck tour."  The First Circuit also considered the widespread use of "duck" and "duck tours" by companies around the country that provide the same amphibious sight-seeing services (32 of the 36 tours described in the record used the term "duck" and more than 10 used both "duck" and "tour(s)").

You can find the First Circuit's opinion, including concurring opinion, here (PDF, 74 pages).

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[Editor's Note:  Following is a guest post by Katherine Hendricks, a partner at Hendricks & Lewis.]

With the Supreme Court's denial of the petition for a writ of certiorari in June 2008, the Eighth Circuit's opinion in perhaps the most-watched right of publicity case in 2007 in C.B.C. Distribution & Marketing, Inc. v. Major League Baseball Advanced Media, L.P., will stand.

Fantasy sports operator, C.B.C. Distribution and Marketing, Inc. ("C.B.C."), brought a declaratory judgment action against the Internet arm of Major League Baseball, Major League Baseball Advanced Media, L.P. ("Advanced Media") to establish C.B.C.'s right to use--without license--major league baseball players' names and performance statistics in fantasy baseball.

In fantasy baseball, participants form fantasy teams by "drafting" players from major league teams before the season begins each spring.  Participants compete against other fantasy baseball "owners" who have put together their own teams.  Participants' success and that of their fantasy teams depend on the performance of the individual players on their actual teams during the major league season.  Participants pay fees to play and additional fees to trade players during the season.  (According to the Fantasy Sports Trade Association, the fantasy sports business is a $1.5 billion industry with 19.4 million players in the United States and Canada.  Bob Van Voris and Jeff St. Onge, Fantasy Sports Win Right to Player Names, Statistics (Update 5), bloomberg.com, October 16, 2007.)

From July 1995 through December 2004, C.B.C. had a license from the Major League Baseball Players Association ("MLBPA") to use the names, nicknames, likenesses, signatures, pictures, playing records and biographical data of each player as well as the logo, name and symbol of the MLBPA.  The license expired and was not successfully renegotiated with Advanced Media, the entity that had acquired all of the players' rights.  Fearful that Advanced Media would sue C.B.C. for continuing to operate its fantasy sports games without a license, C.B.C. sought declaratory relief in the Eastern District of Missouri.

The district court granted summary judgment to C.B.C., holding that it was not infringing any state-law rights of publicity but that even if publicity rights were implicated, the First Amendment trumped those rights.  The district court also addressed the question whether the players' rights of publicity claims would be preempted by copyright law, finding that the players' records were mere facts which did not involve the sine qua non of copyright: originality.  Because the players' names and playing records were not copyrightable, copyright preemption did not apply.

The Eighth Circuit concluded that the identities of major league players were being used for commercial advantage without their consent and thus, that they made out a cause of action for violation of their rights of publicity.  Nonetheless, these rights were outweighed by the First Amendment.  Because the court held that C.B.C.'s First Amendment rights in offering fantasy baseball products superseded players' rights of publicity, it did not reach the copyright preemption issue.

Weighing rights of publicity against First Amendment considerations is nothing new.  See, e.g., Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562 (1977).  Usually, courts conduct a fact-specific balancing test that compares the competing interest of the person's right of publicity with the public's right to be informed.  The outcome typically depends upon where the use falls on the continuum ranging form "news" (e.g., current events and political commentary) and "public interest" (e.g., fiction or satire), to "commercial speech" (like advertising).  See, e.g., Cardtoons, L.C. v. Major League Baseball Players Ass'n, 95 F.3d 959 (10th Cir. 1996) (a set of collectible trading cards with parody cartoons of major league baseball players accompanied by humorous text); Elvis Presley Enterprises, Inc. v. Capece, 950 F. Supp. 783 (S.D. Tex. 1996) (use of the trade name "The Velvet Elvis" by a nightclub, and its selling of frozen drinks called "Love Me Blenders" and a food item named "Your Football Hound Dog"); New Kids On The Block v. News America Pub. Inc., 745 F. Supp. 1540 (C.D. Cal. 1990), aff'd, 971 F.2d 302 (9th Cir. 1992) (the use by a newspaper and magazine of the "New Kids On The Block" trademark in connection with a "900-number" phone service to conduct polls regarding readers' favorite and "sexiest" members of the musical group).

The Eighth Circuit concluded that C.B.C.'s fantasy sports use falls within the "public interest" portion of that continuum.  Because baseball is "the national pastime" and the public has an "enduring fascination" with baseball's records and statistics, that data is due "substantial constitutional protection."  But perhaps more importantly, the information in question is "readily available in the public domain, and it would be strange law that a person would not have a first amendment right to use information that is available to everyone."

Although the court agreed the players' "identities are being used for commercial advantage," it concluded that the interests fulfilled by a right of publicity (namely, the right of an individual to reap the rewards of his or her endeavors and to earn a living) are "barely" implicated because major league baseball players are already "handsomely" rewarded and also have the opportunity to earn additional large sums from endorsements and sponsorships.

While one might initially and reasonably conclude that publicity rights are outweighed by the First Amendment, the rationale that rights of publicity are "barely" implicated if the holders of those rights already make lots of money is of little use as a general principle within the context of adjudicating publicity rights because those rights are generally most important to celebrities with real star power who more often than not find themselves "handsomely rewarded" for their endeavors.  It might have been preferable to conclude that the public's constitutional free speech interest in using publicly-available facts outweighs any player's individual monetary interest.

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In 2005, CACI Premier Technology, Inc. and CACI International Inc. ("CACI")--a U.S. government contractor that provides intelligence services to the military and which, beginning in 2003, provided civilian interrogators for the U.S. Army's military intelligence brigade at the Abu Ghraib prison--sued talk-radio host Randi Rhodes and others for defamation for statements Rhodes made on The Randi Rhodes Show.  Specifically, CACI claimed that Rhodes accused it of, among other things, torture, rape and murder at the Abu Ghraib prison.

The district court granted summary judgment to the defendants, finding that each of Rhodes's statements were not demonstrably false, were non-actionable hyperbole or were not made with actual malice, the applicable standard in the case as it was undisputed that CACI was a public figure.  In a lengthy decision addressing each of the challenged statements in some detail, the Fourth Circuit agreed and affirmed the grant of summary judgment.  You can find the Fourth Circuit's opinion in CACI Premier Tech., Inc. v. Rhodes, here (WARNING:  the opinion contains descriptions of some of the detainee abuse at Abu Ghraib).

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UPDATE:  And since I'm on the subject of updates, in another "virtual world" case, a consent judgment recently was entered in the case of Eros, LLC v. Leatherwood, in which the plaintiff claimed that the defendant violated the Lanham Act and committed copyright infringement within the virtual world Second Life.  A copy of the Consent Judgment can be found here (PDF, 2 pages) and my earlier discussion of the case, including a copy of the plaintiff's complaint, here.

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UPDATE:  Although I would've liked to see more of this case (just so I could work in "For the Horde" in a blog entry but somehow I just did), it appears there has been a settlement in the case filed by a player of Blizzard's World of Warcraft against so-called "gold farmers," who generate ("farm") virtual gold in-game to sell to players for "real world" money.  It looks like the case is not over yet though as the plaintiff moved for leave to file a motion to enforce the settlement under seal (which was only granted in part, see the Court's order here PDF, 4 pages).  As a side note, even though the motion to file under seal was unopposed, it was comforting to have the Court seriously consider the public's interest in having access to judicial records and to limit the parties' right to file documents under seal.

For my earlier discussion of the case (Hernandez v. IGE U.S. LLC, Case No. 07-21403-CIV-COHN (S.D. Fla.)) and the amended complaint filed in the case, see here.

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