Forest
Park Pictures v. Universal Television Network Inc., 683 F.3d 424 (2d Cir.
June 26, 2012). Forest Park pitched an
idea for a television series based on a concierge doctor who made house calls
to the rich and famous after being shunned by the medical profession for
treating patients without payment. First
pitch was by mail. Then a follow up
meeting and communication. Then
silence. Just under four years later,
USA Network comes out with a show called “Royal Pains” with an identical story
premise. Forest Park sues. The district court granted USA Network’s
motion to dismiss on the grounds that Forest Park’s claim was preempted by the
Copyright Act. On this appeal, the
Second Circuit reversed, finding that an implied-in-fact contract under
California law is not preempted by the Copyright Act. Preemption exists where a state law creates
a right equivalent to one under the Copyright Act, that is “if it may be
abridged by an act which, in and of itself, would infringe one of the exclusive
rights” under the Copyright Act. But
there is no preemption where “if an extra element is required instead of or in
addition to the acts of reproduction, performance, distribution or display, in
order to constitute a state-created cause of action”. The Second Circuit’s decision contains an
excellent survey of state law claims that have been held to be preempted by the
Copyright Act and a survey of sister circuits that have determined that certain
contract claims involving copyright are not preempted. The Second Circuit distinguished between
contracts implied in fact and those implied by law. An implied-in-fact contract is a “true
contract” that arises from the tacit consent of the parties. It is not preempted. An implied-in-law contract (or unjust
enrichment claim) merely requires proof of unjust enrichment and is not
different from a copyright infringement claim.
Accordingly, an implied-in-law contract is preempted by the Copyright
Act. Noting a potential conflict between
New York and California on the issue of whether a contract may be implied in
fact, the Second Circuit applied the “center of gravity” choice of law analysis
and found that California law applied.
An important decision worth reading in an area of law that is murky and
difficult.
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