Is "Offering to Distribute" the Same as "Distribution" Under the Copyright Act

The District Court for Arizona in Atlantic v. Howell rejected the record industry's motion for summary judgment that contended that merely making available music files for downloading through a file sharing service constituted copyright infringement.  This reverses the court's previous ruling from August 2007.   The key issue is whether "making available" or "offering to distribute" copyrighted works, absent evidence of actual distribution, violates a copyright owner's exclusive distribution rights under Section 106 of the Copyright Act.  This is the third case this April to weigh in on this issue.  Howell joins the U.S. District Court in Massachusetts in London-Sire Records v. Doe in requiring more than merely making the infringing works available.  The Southern District of New York held the opposite in Elektra v. Barker.  Undoubtedly this is just the beginning so stay tuned.  For more information (albeit from an interested party), the EFF has a page addressing these issues. 

When Are You a Leech? Lawsuit Alleges that Project Playlist Infringes Label Copyrights

A fascinating new lawsuit filed by the major record labels.   The record labels sued Project Playlist on Monday alleging that the website was guilty of massive infringement.  What's fascinating is that Project Playlist purports that it only allows it's users to make playlists of existing, legal music.   In other words, it claims to allow its users to make a playlist consisting of multiple links to music resident on servers elsewhere.  While this behavior has led to liability in Europe, it seems inconsistent with general linking law in the United States.   (although the movie studios have sued so called "leeching" websites like torrentspy.com).  It is unclear whether the record labels are alleging that Project Playlist is solely a leeching website like torrentspy or whether they are alleging more garden variety file sharing liability.  I haven't been able to get a complaint yet, but the reports suggest that the record labels are alleging both the standard Grokster inducement claim as well as Project Playlist's illegal reproduction of the music.  If it turns out that the only allegedly infringing activity of Project Playlist is the inline linking from user's playlists to third party hosted music, this could create new linking law since Project Playlist purports to do more than the typical leeching websites of the world.

The Death of Old Media May Be Sooner Than You Think

There are links to a whole series of stories today that all add up to the fact that the movement of media to the Internet may happen sooner than you think.  I think a lot of us believe that soon enough newspapers will be digital, "television" will be independent of the boxes in our living room and the like, but, if you're like me, you can't help but think of the number of late adopters who need the special converters for when we go to Digital TV in 2009.  Nevertheless,  Google says that the Internet is continuing it's robust growth and that online advertising is looking strong compared to other sectors, http://www.mercurynews.com/google/ci_9064287, the WB network is rising from the ashes as an Internet only destination to compete with Hulu and Joost, http://www.nytimes.com/2008/04/28/business/media/28tube.html, the Capital Times, a Madison, Wisconsin daily is stopping its print edition and publishing only on the web, http://www.nytimes.com/2008/04/28/business/media/28link.html, and, overall, US newspaper circulation continues to drop.  http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003795106.   Even the venerable Hollywood Reporter has realized that it needs to focus more on the web and expand it's blog offerings. 

Naughty, Naughty: Annual Section 301 Report From US Trade Representative

The US on Friday placed nine countries on a "priority watch list" for allegedly failing to protect American producers of movies, computer software and other copyrighted material from widespread piracy.  This will subject them to extra scrutiny and could eventually lead to economic sanctions - if the administration decides to pursue complaints before the World Trade Organization.  The countries were China, Russia, Argentina, Chile, India, Israel, Pakistan, Thailand and Venezuela.  Four countries were removed from the list:  Egypt, Lebanon, Turkey and Ukraine.  Not surprisingly, a large part of the report focuses on China.   Ultimately, the report is a fascinating read on what the priorities are for the US in terms of intellectual protection (mainly pharmaceuticals and entertainment).  It's also an interesting treasure trove of where to get pirated materials when wandering the markets of the Czech Republic or Buenos Aires.  http://www.ustr.gov/Document_Library/Press_Releases/2008/April/USTR_Issues_2008_Special_301_Report.html

 

9 Billion Videos Viewed Every Month

As SAG continued its negotiations with the Alliance of Motion Picture & Television Producers on Thursday, the actors union sent its second report to membership, outlining their position on new media and why it is important to actors.  The report states that people watch 9 billion videos online every month and that by 2010 the 100 leading media companies will be receive over $20B in revenue.  Of course, since this is a union dispute over residuals, undoubtedly we can quibble over the numbers, but regardless of what the "real" numbers are, consumers consumption of video on the web appears to be staggering.

Lennon Family Attempts To Expel Filmmakers

John Lennon's sons and widow, Yoko Ono, are suing the filmmakers of "Expelled: No Intelligence Allowed" for using the song "Imagine" in the documentary without permission.  The filmmakers claim fair use as part of the use.  Although I haven't seen the film, this seems like a strategy on behalf of the filmmakers who had to have known that (a) fair use is always a risky proposition for use of music in film; and (b) using a song publicly known for its association with liberal political causes in a documentary film about a conservative political cause would just waive a red flag in front of the Lennon heirs.  Of course, Expelled's legal defense costs may be the same line item as its marketing budget...

New Orphan Works Bill Introduced

Influential members of both the House and Senate introduced a new orphan works bill as part of an attempt to address the issues of orphan works.  It's not clear whether this bill will go any farther than past attempts, especially in an election year, but it demonstrates the continued resonance of the issue. http://www.billboard.biz/bbbiz/content_display/industry/e3i893a6fe1c07f6804c3f0775990caade6
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For Those of Us Who Can't Keep Up With Everything

User Generated Content Fraught With Risk In Europe

 A recent French decision has blown a gaping hole in the defenses available to Internet companies for hosting third party content under French law.  Article 6-I-2 of the French Law for Confidence in the Digital Economy (LCEN) (which mirrors Article 14 of the EU E-Commerce Directive) states that public providers of "communications services" cannot be held liable for “information stored at the request of a recipient of those services" if the provider "did not have actual knowledge of [the] illegal nature" of the information, or if the provider "acted expeditiously to remove the data or make access impossible" after learning of its illegality (Basically, the requirements of the DMCA). 

The Paris Court of First Instance held last month, however, that Bloobox.net was not immune for hosting a user-submitted link on its Fuzz.fr service, and was liable as an editor for its putative involvement in the "organization and presentation" of the link and associated headline. 

This decision extends a trend in which European courts, particularly on the Continent, have increasingly been willing to find Internet companies liable for user-generated content.  If this trend continues, websites and Internet providers will be looking at major legal problems inEurope .

Thanks to Steptoe & Johnson's E-Commerce Law Week for the link.

Section 230 Good Samaritan Provision Immunizes Party Attempting to Filter SPAM

From Professor Geist at BNA Internet Law News, "BNA’s E-commerce and Law Report reports that a federal court in Illinois has ruled that the immunity provisions of the Communications Decency Act will shield an Internet service provider from liability for suspected spam e-mails blocked in good faith, irrespective of those e-mails' potential CAN-SPAM compliance. The court said that an ISP blocking all e-mail from a prolific marketer fell within the "good samaritan" provision of the Communications Decency Act's intended immunity. Case name is e360 Insight LLC v. Comcast Corp."
Cases like this should allow ISPs and other providers additional leeway to provide broad filters of unwanted content.  It will be interesting, however, to see if decisions like this lead to blockage of more legitimate content.

Whoops! What I Really Meant to Say Was...

Law.com details a fascinating story of a deal that went south and every transactional lawyer's worst fear -- testifying in court about what you meant about a clause when it was drafted.  In this case, the dispute is over something that we all do, agreeing to some ambiguity in a clause because it "preserves wiggle room" down the road or, frankly, is necessary to get the deal done. 
Here's the interesting section from the article, "Kevin Rinker, a Debevoise & Plimpton partner who practices in the area of private equity and who presented a case study of the deal to his fellow partners, agrees with this analysis. From the testimony, he says, it appears Ehrenberg won a point during the negotiations but then failed to clearly articulate it in the contract. Kenneth Adams, a former Jones Day and Winston & Strawn lawyer who now advises law firms on contract matters, goes a step further. "It was a major failure of drafting," he says. "What happens if and when someone walks is a do-not-pass-go issue." Lawyers familiar with the deal say they believe the United Rentals case offers a glimpse into a little-noticed but common practice: Deal lawyers often agree to contracts with ambiguous language for the sake of compromise. Whether this is what happened here, or whether Ehrenberg simply made a mistake, is unknown, but the lesson is clear. "Not­withstanding the pressures of the deal, you really have to think hard about every provision," Rinker says."  http://www.law.com/jsp/article.jsp?id=1209047604522
I think the bottom line is that we all will continue to live with ambiguity.  Very few clients in the licensing context are willing to pay to iron out all the ambiguity from a contract, but the lesson in the above clause is the critical one, it's important to think about the consequences of the ambiguity and opt in to the ambiguity instead of letting it go.  Anyone trying to figure out whether legacy content licenses grant "digital rights" or "mobile rights" knows exactly what I'm talking about.
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Be Good for Goodness Sake: Search Engines in Europe

The EU Working Party responsible for implementing Europe's Data Protection Directive, i.e. the infamous European privacy laws issued an opinion this month found that the EU privacy directive covers a broad range of garden variety search engine activities, e.g. long term caching (a la the Internet Archive), search histories (like the material subpoenaed by the US government at the end of 2007), and collection of IP addresses.  The Working Party also noted that behavioral advertising may not be permissible without users' consent. 

This could hamstring the next generation interactive advertising and, even some garden variety website activities.  One more reason to use care if you're a US company moving into another jurisdiction.

Sticks and Stones: Thinking About Cease and Desist Letter Strategies

The web is alive with links to the response of Kurt Denke, the CEO of Blue Jeans Cable (and former litigator) to cease and desist letter from Monster Cable.  http://www.audioholics.com/news/industry-news/blue-jeans-strikes-back.  Setting aside the merits of his response, this is a great example of how the life of a cease and desist letter has changed.  It has to be assumed that every cease and desist letter will be loaded on to the web and picked apart by those who disagree with the trademark or copyright holder.  As a result, it's critical that those of us sending these letters think not only of how the cease and desist letter will look as an exhibit in litigation, but also how it will reflect on the client or company when it's posted on the web.
And, of course, you can get even more ridiculous.  Have you heard the one about the lawyer who won a copyright infringement lawsuit for the posting of his cease and desist letter... http://www.prweb.com/releases/DozierInternetLaw/InternetLawyer/prweb650951.htm  

Electronic Distribution of Coursework Lawsuit

A group of academic publishers filed a lawsuit against Georgia State University officials on Tuesday, alleging a systematic abuse of copyrighted works in the online distribution of coursework reading materials.   Cambridge University Press, Oxford University Press, and Sage Publications allege the university "facilitated, enabled, encouraged, and induced" professors to upload the copyrighted materials to its online system for students to download, without first obtaining the necessary permissions or paying licensing fees.  The lawsuit, filed in a U.S. District Court in Georgia, may mark the first time publishers have challenged universities over the electronic distribution of written copyrighted works, noted the plaintiffs' attorney.   Here's a link to the NYT story. http://www.nytimes.com/2008/04/16/technology/16school.html?_r=1&ex=1366084800&en=d5bc680387807b8c&ei=5088&partner=rssnyt&emc=rss&oref=slogin

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How Big Are Videogames???

There's been a lot of buzz about Grand Theft Auto IV's $400 Million opening weekend.  Nikki Finke has an interesting guest column today from video game expert Keith Boesky that puts things in perspective.  It's just the tip of the iceberg, but it's a good window into the economics driving video games v. movies v. music.  http://www.deadlinehollywooddaily.com/gta-iv-countdown-are-games-bigger-than-movies-one-expert-analyzes/

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Targeted Ads are Creepy to Consumers

Reuters is reporting that almost 60% of Americansin a Harris Interactive poll were uneasy when Web sites use information about a person's online activity to tailor advertisements or content.  "There's a creepy factor and a fear of the unknown that people don't want to deal with," said Michelle Warren, senior research analyst at Info-Tech Research Group in London, Ontario. 
This is consistent with my experience.  I teach a class on digital media law and policy every year and I always ask the students what privacy intrusion worried them the most.  In the past, identity theft was far and away the overall winner.  This year, targeted advertising and online monitoring was the winner and the reason was clearly the "creepy" factor.
This suggests to me that companies will need to use great care when implementing targeted advertising solutions and that alleviating the "creepy" factor will be at least as important as creating tangible benefits to consumers.

Why Its Important to Own Your IP -- Even When It's Not Obvious

Law.com is reporting today that "Wal-Mart's internal meetings are on display in three decades worth of videos made by a Kansas production company scrambling to stay in business after Wal-Mart stopped using the firm. In response to losing its biggest customer, Flagler Productions has opened its archive, for a fee, to those seeking clips of unguarded moments, including a scene of male managers parading in drag at an executive meeting. Much of the interest in the candid videos is coming from plaintiffs lawyers pursuing cases against Wal-Mart." Read the rest. 

What I found most interesting for the purposes of this blog was that the parties never signed an agreement (in 30 years).   I'm sure no one ever thought there would be an aftermarket for these videos, but in today's day and age, there is a market for just about everything.  This is a good example of why it makes sense to use care with respect to owning you intellectual property -- even for things that aren't customer facing.  My experience is that many companies will use less care when they are hiring outside videographers, photographers, free-lance writers, etc. to produce corporate training films, recordings for archives, etc.

Orphaned Works Legislation

Rumor has it that orphaned works legislation is now being drafted and will be brought to light for legislative consideration sometime this year.  Such has been reported by the American Society of Media Photographers and was the topic of a legislative update at the recent ALI ABA Legal Issues in Museum Administration conference.  According to such sources, there is a good chance that such legislation will be passed sometime this year.

The legislation would affect copyright-protected works that have been orphaned by their respective owners.  Before you start humming, It's a Hard Knock Life, keep in mind that some of these works might not be true orphans.   They might have parents somewhere.  Without casting judgment on any parenting style, the gist is that some safe harbors should be afforded to users who have made a reasonably diligent, good-faith, but ultimately unsuccessful effort to locate a work's copyright holder.

The orphan-works problem is a symptom of the 1976 Copyright Act, which eliminated all of those pesky copyright compliance rules (you know, like publication without copyright notice would drag the work into public domain) to be able to comply with Berne requirements.  But now that copyright holders need not render any affirmative action to ensure at least some level of copyright protection, it can be difficult to know who claims rights to what, even when a would-be user makes a sincere attempt to track down copyright information.  By way of example, consider the copyright in a 1980's home movie purchased from a local thrift shop.  What about that piece of code in a cool vintage video game?  Who owns the rights?  How would you ever locate the rights holder?

Orphaned works legislation would provide limited safe harbors in situations like these. 

The proposal set forth by the Copyright Office in 2006 has three basic elements:

  1. The would-be publisher conducts a good-faith and reasonably diligent search.
  2. The publisher provides minimal and reasonable attribution, as possible  (the idea here being that if a publisher uses a work without the copyright holder's permission, it shouldn't be passed off as it's own).
  3. In the event a copyright holder resurfaces and claims infringement, the copyright holder's damages would be limited to reasonable compensation for use with limited injunctive relief for derivative works made with the copyrighted work.  A kind of compulsory licensing scheme, if you will....

The devil, of course, will be in the details.  As John Waters has said, "There's no such thing as a bad home movie."  I couldn't agree more!  But can well imagine such a thing as bad orphaned works legislation.  So, if you care about this, I encourage you to keep apprised of the legislation and let your voice be heard.  In the meantime, the Copyright office report can be found here.

 

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