On September 29, 2020, the Justices of the U.S. Supreme Court will decide whether or not to grant certiorari in Steinbeck v. Kaffaga, a case involving the rights of authors and their heirs to terminate copyright grants. Copyright terminations have generated a tremendous amount of litigation and uncertainty, this is a case to watch!
In 1976 and 1998 Congress extended the terms of copyright. Congress intended for authors to receive the full economic benefit of the extended copyright terms by granting authors and their heirs inalienable rights to recapture copyrights. These recaptured copyrights, vesting free of all prior grants, could then be re-licensed on economic terms favorable to authors. To protect authors’ families from disinheritances, late-life lovers or squabbles among over-reaching heirs, Congress preempted state inheritance law and created statutory heirs.
Congress’ statutory scheme benefiting authors and their families has been threatened by recent decisions of the Second and Ninth Circuits that have generated a recent cert petition to the Supreme Court in Steinbeck v. Kaffaga over film rights to The Grapes of Wrath. Many copyright termination disputes are now pending.
Ray Dowd in examines this fascinating case and discusses why understanding the issues at stake and the mechanics of copyright terminations is important for all attorneys dealing with copyrights. Whether you are negotiating a license agreement or advising copyright owners and their heirs on estate planning, copyright termination is a hot issue.
On April 29, 2020, we filed an amicus curiae brief on behalf of The Authors Guild, The Dramatists Guild, The American Society of Journalists and Authors, and former Register of Copyrights Ralph Oman at the United States Supreme Court. The case involves a dispute among John Steinbeck’s heirs over who should benefit from copyright termination rights under Sections 203 and 304 of the Copyright Act. The brief argues that a number of federal courts have misinterpreted provisions of the Copyright Act of 1976 and the Copyright Term Extension Act of 1998 that permitted authors to terminate copyright grants and to recapture the copyrights for the periods of time that Congress extended the copyrights. According to the brief, Congress intended to benefit authors and their heirs when Congress extended copyright terms in 1976 and again in 1998. Amici curiae argue that the federal courts have frustrated Congressional intent by upholding prior copyright grants that the plain language of the Copyright Act permits authors to invalidate. Check out the brief here.
The first edition of Copyright Litigation Handbook was published in 2006 by West, now Thomson Reuters. It is available in a handy desk version with the Copyright Act, the Federal Rules of Civil Procedure, and the Federal Rules of Evidence as appendices. It is also available on Westlaw. It was designed to bring together procedural and evidentiary opinions in copyright litigation to quickly orient busy practitioners. It was also meant to provide guidance to Copyright Office procedures affecting copyright litigation and to collect relevant decisions to put at the practitioner's fingertips.
I update Copyright Litigation Handbook annually by reading all published appellate court opinions that discuss copyright. My focus is on trying to guide practitioners from client intake through judgment with a focus on "how to" procedural questions.
I receive questions about copyright litigation and about the content in Copyright Litigation Handbook from clients and attorneys around the country. These questions help me sharpen and improve the content and focus on emerging issues for future editions, for which I am grateful.
I am also grateful to the federal practitioners and judges who have cited Copyright Litigation Handbook over the years on numerous substantive and procedural issues. Below I have included citations from federal courts. I am thankful to those lawyers and federal judges who have relied on this work.
Although Westlaw gives access to Copyright Litigation Handbook year-round, the 2019-2020 print edition will be out in October and is not printed again until the following year. There have been many changes in copyright law and litigation in the past years, I hope you will consider ordering a fresh copy by clicking on the link here to keep at your desk and that this proves to be a time-saver and reliable friend in navigating the tricky waters of copyrights.
Respectfully yours, Raymond J. Dowd
Author - Copyright Litigation Handbook Partner - Dunnington Bartholow & Miller LLP - New York City Adjunct Professor - Fordham University School of Law
Distinction Between "Piracy" and "Similarity" Copyright Infringement Actions
The range of infringement remedies further informs Robbins' complaint here. “One type of action is a ‘piracy’ action in which the alleged infringing article is an exact replica of the original. Another ... involves an action based on an allegedly infringing article which is similar to, but not an exact replica of the copyrighted work. The courts apply a ‘substantial similarity’ test in these actions, which are more difficult to prove.” CopyrightLitigationHandbook § 9:9 (Motions to dismiss for failure to state a claim ) (2010). Courts examine substantial similarity at the pleading level (typically on a Fed.R.Civ.P. 12(b)(6) motion to dismiss). See id. n. 17 & 18 (collecting cases).
Robbins v Artits--Usher, CV411-193, 2011 WL 5840257, at *2 [SD Ga Aug. 29, 2011]
License As An Affirmative Defense To Copyright Infringement
Defendant argues that the alleged failure to pay royalties was not a breach of the Video Distribution Agreement because the agreement does not specify a date and time for payment, and therefore Plaintiff did not properly terminate the agreement. In other words, Defendant contends the license to sell the “Musical Journeys” under the agreement remains in effect. However, the existence of a license is an affirmative defense. SeeWilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 955 (11th Cir. 2009) (license is an affirmative defense to copyright infringement); Carson v. Dynegy, Inc., 344 F.3d 446, 451 (5th Cir. 2003) (“[T]he existence of a license authorizing the use of copyrighted material is an affirmative defense to an allegation of infringement ....”); CopyrightLitigationHandbook § 13:10 (2d ed.) (“The existence of a license, exclusive or nonexclusive, creates an affirmative defense to a claim of copyright infringement. Thus, once a copyright owner has shown use of the copyrighted work, the burden of proving that the use was authorized falls squarely on the defendant.”).
NAXOS Rights US INC. v. Wyatt, 2016 WL 5724064 (M.D. FL 2016)
It is well established that the existence of a license is an affirmative defense to a copyright infringement claim. See Latimer v. Roaring Toyz, Inc., 601 F.3d 1224, 1235 (11th Cir. 2010) (“an implied license is an affirmative defense to a claim of copyright infringement”); Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 955 (11th Cir. 2009) (existence of license asserted as an affirmative defense to copyright infringement claim); Jacob Maxwell, Inc. v. Veeck, 110 F.3d 749, 751 (11th Cir. 1997) (in response to a copyright infringement claim, defendant argued it had a nonexclusive license to use the material). See also, CopyrightLitigationHandbook § 13:10. Defenses commonly arising in copyright litigation—License (2d ed.).
Anand Vihar LLC v Evans Group Inc., 8:16-CV-841-T-27TBM, 2016 WL 9526560, at *2 [MD Fla July 6, 2016]
Substantial Similarity of Literary Works
Expert testimony is far less critical in a case like this than it is in a case where specialized knowledge is required to dissect the objective components of the copyrighted work. See, e.g., Brown Bag Software, 960 F.2d at 1473–74 (relying on expert testimony to identify the objective points of comparison among different computer software programs); Swirsky v. Carey, 376 F.3d 841, 847–48 (9th Cir.2004) (relying on expert testimony comparing the objective elements—pitch, melodies, baselines, tempo, chords, structure, and harmonic rhythm—of musical works); Chiate v. Morris, Case No. 90–55428, 1992 WL 197591, *5 (9th Cir., Aug. 17, 1992) (finding that expert testimony by a musicologist is crucial to proving objective similarity of songs); see alsoDowd, CopyrightLitigationHandbook § 15:27 (2d ed.2009) (noting that expert testimony is often helpful in cases involving computer programs and functional objects, but will “seldom be necessary” to determine substantial similarity between literary works).
Gable v Natl. Broadcasting Co., 727 F Supp 2d 815, 837 [CD Cal 2010], affd sub nom.Gable v Natl. Broadcasting Co., Inc., 438 Fed Appx 587 [9th Cir 2011]
Further, this case does not involve a highly technical area of expertise. Unlike a patent case comparing two technical devices, or a copyright case involving computer software or music, this case involves the comparison of a film script to a television series. The works are targeted at a general audience and deal with subject matter readily understandable by any ordinary person, including the Court. Thus, expert testimony is far less critical in a case like this than it is in a case where specialized knowledge is required to dissect the objective components of the copyrighted works. See, e.g., Brown Bag Software, 960 F.2d at 1473–74 (relying on expert testimony to identify the objective points of comparison among different computer software programs); Swirsky v. Carey, 376 F.3d 841, 847–48 (9th Cir.2004) (relying on expert testimony comparing the objective elements—pitch, melodies, baselines, tempo, chords, structure, and harmonic rhythm—of musical works); Chiate v. Morris, Case No. 90–55428, 1992 WL 197591, *5 (9th Cir., Aug. 17, 1992) (finding that expert testimony by a musicologist is crucial to proving objective similarity of songs); see alsoDowd, CopyrightLitigationHandbook § 15:27 (2d ed.2009) (noting that expert testimony is often helpful in cases involving computer programs and functional objects, but will “seldom be necessary” to determine substantial similarity between literary works).
Bernal v. Paradigm Talent and Literary Agency, 788 F.Supp.2d 1043 (C.D.CA 2010)
Voluntary Dismissal Under Rule 41(a)
Section 505 of the Copyright Act of 1976 allows the Court to “award a reasonable attorney's fee to the prevailing party.” 17 U.S.C. § 505 (emphasis added). “The Supreme Court has defined a ‘prevailing party’ as one who has ‘prevailed on the merits of at least some claims.’ ” Torres–Negron v. J & N Records, LLC, 504 F.3d 151, 164–65 (1st Cir. 2007) (dismissal for lack of subject matter jurisdiction was not on the merits and Defendant was not entitled to recover as prevailing party under Section 505) (citing Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603–05, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001) ). Thus, when “an order of voluntary dismissal is entered by a plaintiff under Rule 41(a) of the Rules of Civil Procedure ‘without prejudice’ there is no award of attorney's fees under the Copyright Act.” Raymond J. Dowd, CopyrightLitigationHandbook § 18:2 (2d ed. 2017).
Feliciano Rivera v Pina Nieves, 292 F Supp 3d 560, 564 [DPR 2018]
Attaching Copyright Materials and Alleged Infringements To Complaint
At least one treatise has warned that “[w]here a federal judge perceives (correctly or not) that a plaintiff attempted to conceal a weak case by failing to attach sample copyrighted material and infringing material, the plaintiff may be severely prejudiced moving forward.” RAYMOND J. DOWD, CopyrightLitigationHandbook § 9.9 (2d ed.2013).
Williams v Black Entertainment Tel., Inc., 2014 Copr L Dec P 30566 [EDNY Feb. 14, 2014]
The Court does find it telling, however, that Woolcott has not submitted photographs displaying both sides of The Woolcott Residence. At least one treatise has warned that “[w]here a federal judge perceives (correctly or not) that a plaintiff attempted to conceal a weak case by failing to attach sample copyrighted material and infringing material, the plaintiff may be severely prejudiced moving forward.” Raymond J. Dowd, CopyrightLitigationHandbook § 9.9 (2d ed.2013).
Woolcott v Baratta, 13-CV-2964 JS GRB, 2014 WL 1814130, at *8 [EDNY May 7, 2014]
Certified Copy of Deposit Not Necessary To Show Copyright Validity
Defendants may not argue that a certified copy of the image submitted to the Copyright Office is required to show copyright validity, as this is not an accurate statement of the law. SeeCopyrightLitigationHandbook § 4:3 (2d ed.) (“A copyright registration is sufficient evidence of a valid copyright, and a copyright holder need not place into evidence certified or deposit copies of ... the compositions at issue to prove that it holds a valid copyright”) (internal citations and quotation marks omitted).
Sweet People Apparel, Inc. v Saza Jeans, Inc., CV 14-1143 DMG (ASX), 2015 WL 12669884, at *3 [CD Cal June 25, 2015]
Supplementing Pleadings With Post-Commencement Copyright Registrations
The plaintiff in Pyatt, though, did not seek to amend the Complaint. In fact, subsequent treatises have cited Pyatt for the proposition that post-commencement registrations will not automatically be read into the complaint and that the plaintiff should seek amendment. SeeRaymond J. Dowd, CopyrightLitigationHandbook § 7:1 (2d ed. 2012) (“[I]f a plaintiff registers copyrights after the filing of a complaint but does not supplement the complaint pursuant to Rule 15(d) of the Federal Rules of Civil Procedure, the court may dismiss the case.”)
Membler.com LLC v Barber, 2013 Copr L Dec P 30494 [EDNY Sept. 23, 2013]
Because Gattoni has alleged only that the registration for the allegedly infringed film is pending, and because no application has been made by Gattoni to amend the Complaint if and when the Photograph became registered, Gattoni has not properly pled the pre-requisite element of a copyright infringement claim, and the Complaint's cause of action for copyright infringement necessarily fails to state a claim. The Defendant's motion to dismiss the copyright infringement claim is granted without prejudice. SeeMembler.com LLC v. Barber, No. 12-CV-4941 JS GR, 2013 WL 5348546, at *5 (E.D.N.Y. Sept. 23, 2013) (explaining that Pyatt v. Raymond, 462 Fed.Appx. 22 (2d Cir. 2012) now stands for the proposition that post-commencement registrations will not automatically be read into the complaint and the plaintiff should seek amendment); Raymond J. Dowd, CopyrightLitigationHandbook § 7:1 (2d ed. 2012) (“[I]f a plaintiff registers copyrights after the filing of a complaint but does not supplement the complaint pursuant to Rule 15(d) of the Federal Rules of Civil Procedure, the court may dismiss the case.”)
Gattoni v Tibi, LLC, 254 F Supp 3d 659, 663 [SDNY 2017]
Evidence of Joint Authorship of a Work Covered By Copyright
Additionally, defendant Adcom could not sustain its request for a conclusion of law to be included for joint authorship. This requires that, even if it was not barred, at least defendant had shown it had control over the work and there was an objective manifestation of intent to be co-author.7 Raymond J. Dowd, CopyrightLitigationHandbook§ 2:14 and § 8:5 (2d ed. 2007).
Gener-Villar v Adcom Group, Inc., CV 03-1306 (FAB/CVR), 2008 WL 11500385, at *9 [DPR July 2, 2008]
First Sale Doctrine As A Defense To Copyright Infringement
Plaintiffs also move to dismiss the first and second counterclaim because the allegations of Defendants’ involvement with “legitimate textbooks” and “textbooks lawfully made and sold abroad” are not based on an actual controversy. (Doc. No. 27 at 8-9.) According to the parties, these allegations relate to the first sale doctrine, which the Supreme Court extended to copyrighted works lawfully manufactured outside the United States in Kirtsaeng v. John Wiley & Sons, Inc., 568 U.S. 519 (2013). The first sale doctrine is a defense to infringement. SeeBrilliance Audio, Inc. v. Haights Cross Commc’ns, Inc., 474 F.3d 365, 369 (6th Cir. 2007) (“It is true that trademark law contains a ‘first sale’ exception that provides a defense to claims of infringement.”); Raymond J. Dowd, CopyrightLitigationHandbook § 13:31 (2d ed. 2017) (section titled “Defenses commonly arising in copyright litigation—First sale doctrine”)
Pearson Educ., Inc. v C&N Logistics, Inc., 3:18-CV-00438, 2018 WL 6528128, at *6 [MD Tenn Dec. 12, 2018]
Subpoena In DMCA Action Had To Be Served In Compliance With Rule 45 In District In Which Facebook Resided
Facebook is working under the § 512(c) safe-harbor functionality, making it applicable to the DMCA subpoena process, and the subpoena was served on Facebook in accordance with § 512(h)(4).7 Requestor objects that Facebook provides no authority for its construction of § 512(h) interpreted or rewritten or governed by Rule 45(c) other than Usov v. Lazar, No. 13 Civ. 818 (RWS), 2014 WL 4354691, at *14–15 (S.D.N.Y. Sept. 2, 1014)(quashing a subpoena served on Credit Suisse AG because it violated Rule 45(c)’s 100–mile limit).8 The CopyrightLitigationHandbook § 14:10 “Protective orders and motions to compel (2d ed.), relies on In re Subpoena to Univ. of N. Ca. at Chapel Hill, 367 F. Supp. 2d 945, for the same interpretation that Facebook asserts here. On the other hand, the Court observes that it is Requestor who presents no authority for his refusal to apply Rule 45(c) to § 512(h). In re: DMCA Section 512(h) Subpoena to Facebook, Inc., CV 4:15-MC-0654, 2015 WL 12805630, at *4 [SD Tex Nov. 18, 2015]
Fifth Circuit: Discussing Complete Preemption In The Copyright Context
In an unpublished opinion, the Third Circuit concluded that in the context of the state-law claim at issue there was no copyright preemption. Bd. of Chosen Freeholders of Cnty. of Burlington v. Tombs, 215 Fed.Appx. 80, 82 (3d Cir.2006). One commentator notes, citing Tombs, that the Third Circuit has “rejected complete preemption in the copyright context.” CopyrightLitigationHandbook § 10:1 (2d ed.). It is correct that Tombs rejected the application of preemption to a specific cause of action. Tombs did not reject, however, complete preemption generally under the Copyright Act.
The Ninth Circuit made it a lot tougher for copyright owners to sue internet protocol address subscribers for copyright infringements where the infringements were made by third parties using the subscriber's internet accounts. Here, the defendant subscriber was not a regular occupant of an adult foster care home where the alleged infringement occurred. Because the pleader did not identify the device causing the infringement and did not timely serve the likely infringer, the action was dismissed for failure of timely service under Rule 4(m) of the Federal Rules of Civil Procedure. IP address owner held not to be a contributory infringer.
Rule
4(m) of the Federal Rules of Civil Procedure requires timely service upon a
defendant – ninety days unless good cause is shown to excuse the failure.[1]Although copyright owners can often trace
infringement of copyrighted material to an IP address, it is not always easy to
pinpoint the particular individual or device engaged in the infringement.[2]
Internet providers, such as Comcast or AT & T, can go so far as to identify
the individual who is registered to a particular IP address (i.e., an account
holder) and the physical address associated with the account, but that
connection does not mean that the internet subscriber is also the infringer.[3]
Simply establishing an account does not mean the subscriber is accessing the
internet, and multiple devices can access the internet under the same IP
address. Identifying an infringer becomes even more difficult where numerous
people live in and visit a facility that uses the same internet service.[4]
The Ninth Circuit upheld dismissal of a claim against an adult foster care home
where the plaintiff could not pinpoint the individual infringer or the device
being used.[5]
The dismissal was pursuant to Rule 4(m) of the Federal Rules of Civil Procedure
that requires timely service upon a defendant.[6]The claims for direct infringement were
dismissed without prejudice: the claims for contributory infringement were
dismissed with prejudice.[7]
The Ninth Circuit noted: while we recognize this obstacle to naming the correct
defendant, this complication does not change the plaintiff's burden to plead
factual allegations that create a reasonable inference that the defendant is
the infringer.Noting that because the
defendant was not a regular occupant of the facility or a likely infringer, the
Ninth Circuit affirmed an award of attorneys fees in his favor.[8]
In Erickson Productions, Inc. v. Kast, --- F.3d --- (9th Cir. 2019) the Ninth Circuit vacated a jury verdict of $450,000 for three photographs on Atherton Trust's website. The Ninth Circuit: 1. vacated the verdict of vicarious liability; 2. upheld the verdict of contributory liability but vacated the "willfulness" finding that permitted the statutory damages to be enhanced from $30,000 per infringement to $150,000.
The Ninth Circuit addressed a question of first impression for it and any other circuit court: is avoidance of licensing fees by unauthorized copying a "direct financial benefit" sufficient to sustain vicarious liability as a matter of law? The Ninth Circuit answered "no".
Defendant Kast hired a website design company and oversaw its development of his website. Three photos provided by the website design company were published without authority of the copyright holder, photographer Erickson. Kast testified that he had no knowledge that the photographs were not licensed and the record supported his position that the website development company had agreed to provided licensed photographs to him.
Vicarious Liability for Copyright Infringement. To prove vicarious liability, a plaintiff must demonstrate defendant 1. has the right and ability to supervise the infringing conduct and 2. a direct financial interest in the infringing activity.
Photographer Jim Erickson argued that Kast received three "direct" financial benefits from use of the unauthorized photos: 1. enhanced attractiveness of the website to draw visitors; 2. avoidance of licensing fees; and 3. Kast launched his website faster.
The Ninth Circuit rejected each of these rationales. Importantly, the Ninth Circuit noted that if the direct infringer's avoiding license fees alone were sufficient to impose vicarious liability, the requirement of a "direct financial benefit" for vicarious liability would be rendered meaningless because direct infringers avoid license fees in every case that licenses are for sale.
Jury Instructions on Willfulness For Contributory Infringement Liability. The Ninth Circuit upheld Kast's liability for contributory infringement. A party engages in contributory copyright infringement when it 1. has knowledge of another's infringement and 2. either (a) materially contributes to or (b) induces that infringement. Absent a finding of willfulness, the jury may award statutory damages in a sum of not less than $750 nor more than $30,000" per work. However, where copyright infringement is "willful" Section 504 of the Copyright Act permits a court to increase the statutory damages award up to $150,000 per infringed work.
To prove willfulness under the Copyright Act, the plaintiff must show (1) that the defendant was actually aware of the infringing activity, or (2) that the defendant's actions were the result of reckless disregard for, or willful blindness to, the copyright holder's rights.
However, the jury had been instructed to find willfulness if the defendant "should have known that those acts infringed plaintiffs' copyrights".
The Ninth Circuit found the "should have known" language to be erroneous because it imposes liability for mere negligence, a less culpable state of mind than "willfulness".
