Copyright Power Struggle Gets a New Twist

A broad range of media outlets publicized the “Blurred Lines” copyright infringement case.  Marvin Gaye’s family won a multimillion dollar jury verdict against Robin Thicke and Pharrell Williams for infringing Gaye’s song “Got to Give it Up” with the Thicke and Williams song “Blurred Lines.”

Much criticism has been directed at the trial process in the Blurred Lines case.  However, legal scholars Sean O’Connor, Lateef Mtima and Lita Rosario articulate a different view of the case.  Traditionally, the focus in copyright infringement cases has been on the written music.  “Stuck on the page,” as one of my jazz musician friends says.  In a recent Seattle Times editorial, O’Connor, Mtima and Rosario assert that

The travesty of the old lead-sheet system means that distinctive parts of Gaye’s composition, especially percussion and backing vocal parts, were not before the jury.

The older focus on literal melodic copying systematically disfavored artists of color. Relying on this presumed exclusion of harmonic and rhythmic elements, record companies perennially promoted white artists from Elvis Presley to Iggy Azalea who could perform songs imitating artistic innovations of black artists. Many copyright experts have been content to live with this system, so long as marginalized artists of color were the ones to suffer the inequity.

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It’s a Bead Dog Eat Bead Dog World!

The Fifth Circuit Court of Appeals:  “This case concerns the intersection between intellectual property rights and a Mardi Gras tradition.”  New Orleans Mardi Gras parade onlookers receive strands of beads thrown by parade “krewes.”   The onlookers can create “bead dogs” by twisting the strands of beads into the shape of a dog.  Haydel Enterprises, which also owns a bakery that sells special Mardi Gras cakes, commissioned an artist to design a “Mardi Gras Bead Dog” mascot.  Haydel’s jewelry mascot is made of sterling silver.  Haydel received USPTO trademark registrations for the MARDI GRAS BEAD DOG word mark and for its design mark.  Haydel also received a copyright registration from the Copyright Office for its jewelry design.

Raquel Duarte sells jewelry and accessories through her business, Nola Spice Designs.  Duarte sells a bead dog that she makes from beads and wire, which she learned to do as a child.  Nola Spice Designs received a cease and desist letter from Haydel.  Nola Spice Designs sued Haydel for a declaratory judgment that its actions do not violate trademark law and sought the cancellation of Haydel’s trademark.  Haydel asserted trademark infringement and copyright infringement counterclaims against Nola Spice.  This post focuses on the Fifth Circuit’s copyright infringement discussion.

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Omega Can’t Pull Off Copyright Infringement Hat Trick

High end Swiss watch manufacturer Omega decided to take on discount retailer Costco.  Omega registered its Omega Globe Design with the U.S. Copyright Office.  Omega engraved its Omega Globe Design on the back of some of its Seamaster watches.  Costco bought authentic Omega Seamaster watches on the “gray market.”  The gray market is “a market that legally circumvents authorized channels of distribution to sell goods at prices lower than those intended by the manufacturer.”  Costco sold some of the engraved Seamaster watches in California.  Omega then sued Costco for copyright infringement, claiming that Costco imported copyrighted works (the engraved Omega Globe) without the copyright holder’s permission.

This case went all the way to the U.S Supreme Court once.  An equally divided court summarily affirmed the Ninth Circuit’s first decision.  The first time it heard the case, the Ninth Circuit ruled that the first sale doctrine did not apply to copies of copyrighted works produced abroad.  The first sale doctrine states that once the copyright holder sells a copy of a work, the copyright owner cannot claim copyright infringement for unauthorized distribution for any subsequent sales of that particular copy. 

The case was remanded to the district court.  The district court ruled that Omega impermissibly attempted to expand its limited monopoly and therefore misused its copyright of the Omega Globe.  The Ninth Circuit affirmed the district court’s grant of summary judgment to Costco.

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Tavern Challenges BMI’s Chain of Title for Songs

Evie’s Tavern Ellenton, Inc. and owner Michael Evanoff (Evie’s Tavern) were sued by Broadcast Music, Inc. (BMI), The Bernard Edwards Company, LLC, R-Key Darkus Publishing, Orbi-Lee Publishing and other plaintiffs for copyright infringement.  The plaintiffs alleged that Evie’s Tavern violated their ownership rights by publicly performing copyrighted musical compositions without a license.  Instead of taking the plaintiffs’ ownership claims at face value, Evie’s Tavern challenged plaintiffs’ ownership claims.  Although Evie’s Tavern lost, this case illustrates how tenuous copyright ownership claims for musical works can be.

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Petrella Brings Copyright Statute of Limitations Focus Shift to Circuits

Architectural firm Chicago Building Design, P.C. sued one of its former clients, Mongolian House, Inc., for copyright infringement.  At the district court level, the parties and the court focused on the date on which the statute of limitations began to run.  The district court dismissed the complaint as barred by the statute of limitations.

The Seventh Circuit reversed and remanded, stating: “In light of Petrella, we now know that the right question to ask in copyright cases is whether the complaint contains allegations of infringing acts that occurred within the three-year look-back period from the date on which the suit was filed.”  (Opinion pdf page 12).

My post on the Petrella case is Raging Bull Copyright Owner KO’s Film Studios.

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No Record But Still the Same Old Tune

The district court eloquently described the case’s status and defendants’ post-trial motion following a jury verdict in favor of the plaintiffs.  My favorite sentence in this passage is “Ultimately, the goal is to make a dispute understandable to a lay person.”:

While the world has moved beyond the free-MP3-download craze, the parties in this case have not. This hard-fought litigation spans 7 years and 628 docket entries. Numerous substantive motions were heard. And decisions by this Court did not deter the parties from revisiting the same issues time and again. As trial approached, the parties launched salvos of motions in limine seeking to resurrect discovery disputes, relitigate prior motions, and level an impressive array of claims and defenses. 

A primary function of pre-trial litigation is to distill claims. Ultimately, the goal is to make a dispute understandable to a lay person. Despite this Court’s efforts to winnow the issues, the parties insisted on an 82-page verdict sheet on liability and a 331-page verdict sheet on damages that included dense Excel tables, necessitating at least one juror’s use of a magnifying glass. While the jury did its best, their assignment was beyond all reasonable scale.

To understand how this happened, one must look at the impetus for this litigation. Robertson created a business model designed to operate at the very periphery of copyright law.  While Robertson’s business practices sometimes infringed copyrights, many of the Plaintiffs’ claims were just too big to succeed. Plaintiffs’ evidence on their most significant theories of liability—red flag knowledge and willful blindness—was sparse. And Robertson—by his words, actions, and demeanor—came across as unworthy of belief. That led the jury to rely on something other than the evidence in reaching portions of its verdict. For the following reasons, Robertson’s motions are granted in part and denied in part.

(Opinion pdf pages 1-2).

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Alleged Infringing Downloaders Call Out Movie Owner’s Infringing Activities

Riding Films, Inc. claims to own a copyright in the movie “Dawn Ride.”  Riding Films sued unnamed “John Doe” defendants in at least fifteen separate lawsuits throughout the country, alleging that the John Doe defendants copied and distributed the film without authorization.  Specifically, Riding Films alleges that the defendants downloaded the film using the BitTorrent protocol, thereby copying and distributing without authorization.  In a case before the Southern District of Ohio, some of the individually name defendants alleged that Riding Films’ copyright is invalid and filed a declaratory judgment counterclaim.

Riding Films filed a motion to dismiss the defendants’ declaratory judgment counterclaim for failure to state a claim upon which relief can be granted.  The defendants alleged that Dawn Ride appears to be a remake of an earlier film, that Riding Films did not obtain rights to the earlier version, that Melange Pictures, LLC owns the copyrights in the earlier version and that Melange Pictures is not affiliated with Riding Films.  The district court agreed with the defendants and denied Riding Films’ motion to dismiss the declaratory judgment counterclaim.

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License for Entire Term of Helga Hat Copyright Enforceable, For Now

This case involves the enforceability of a settlement agreement in a copyright infringement lawsuit.  David John registered a copyright for a Viking hat, aka a Helga hat.  MainGate, Inc. sold Minnesota Vikings wear, including Viking hats.  John sued MainGate, alleging that MainGate’s Viking hats infringed his Helga hat copyright.  MainGate received a license from John in exchange for a lump sum payment and royalties on future sales.  One of the terms of the settlement agreement provided that “the term of this royalty obligation is for the life of the copyright and it shall end when the copyright ends. During that time, neither side can withdraw from this agreement for the life of the copyright.”  (Opinion pdf p. 8).

John grew dissatisfied with MainGate’s refusals to John’s requests for inventory audits that John believed he was entitled to under the settlement agreement.  John again sued MainGate for copyright infringement.  The district court ruled that MainGate did not breach the settlement agreement, that John could not terminate the settlement agreement and that MainGate’s license continues until John’s copyright expires.  Given an author’s copyright grant termination rights, the enforceability of the license for the entire length of the copyright remains to be seen.

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No Shortcuts Allowed in Copyright Infringement Case Analysis

Here’s a story of a company founder leaving the company and the geographical area and starting a new company in the same line of business.  It’s not necessarily a story about what not to do.  It’s more a story of the legal issues that can arise when the founder creates copyrighted works, assigns the ownership of the copyrighted works to the first company and then creates similar works for the second company.  Perhaps the founder could have retained the right to make derivative works, instead of assigning all of his copyright rights to the first company. 

David Richison founded the Ernest Group, dba Paycom Payroll, a payroll processing company, in Oklahoma in the 1990s.  He wrote two software programs for use at the company and then assigned his copyright interest in the programs to the Ernest Group.  Richison left Oklahoma and the Ernest Group.  He moved to Maryland and founded Period Financial Corporation, also a payroll processing company.  Richison wrote two more software programs for Period.  One of the programs was based on a program Richison wrote for Paycom. 

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Aereo Publicly Performs and Infringes Copyrighted Works

Aereo’s network receives broadcast television programming through thousands of dime-sized antennas. Aereo makes that programming available to subscribers by streaming the programming over the Internet.  Each subscriber is assigned a dedicated antenna that is not available to any other subscriber for the duration of the selected program.  A personal copy of the selected program is made for each subscriber.  Only the subscriber can access her personal copy.  When the broadcast companies sued Aereo for copyright infringement, the district court denied the broadcasters’ motion for a preliminary injunction.  The Second Circuit affirmed, ruling that Aereo does not publicly perform the transmitted works because the stream to the subscriber is a private transmission.  Read more about the Second Circuit’s decision in my post Unauthorized Streaming of Television Broadcasts Not Infringing.

Copyright owners have the exclusive right to publicly perform the works that they own.  The U.S. Supreme Court majority saw this case as reducing down to two questions:  “First, in operating in the manner described above, does Aereo ‘perform’ at all? And second, if so, does Aereo do so ‘publicly’?” (Opinion pdf page 8).  The Court ruled that Aereo’s activities are both a performance and a public performance.  Aereo infringes by violating the copyright owners’ exclusive right of public performance.

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