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Ninth Circuit Once Again Preserves Competitor’s Data-Scraping Rights

On remand from the Supreme Court of the United States, the US Court of Appeals for the Ninth Circuit reaffirmed its own 2019 opinion that preliminarily enjoined a professional networking platform from denying a data analytics company access to publicly available profiles. HiQ Labs, Inc. v. LinkedIn Corporation, Case No. 17-16783, (9th Cir., Apr. 18, 2022) (Wallace, Berzon, Berg (sitting by designation) JJ.).

Previously, the Supreme Court had granted certiorari in this case, but subsequently vacated the judgment and remanded back to the Ninth Circuit for further consideration in view of its  2021 decision in Van Buren v. United States. In Van Buren, the Supreme Court attempted to clarify the reach of the Computer Fraud and Abuse Act of 1986 (CFAA), holding that authorized computer access for arguably improper purposes likely does not constitute a violation of the CFAA. On remand, the Ninth Circuit concluded that Van Buren reinforced its determination that hiQ had raised “serious questions” about whether LinkedIn may invoke the CFAA to preempt hiQ’s claim of tortious interference.

HiQ is a data company that sells “people analytics” focused on predictive employee data. HiQ’s data is largely obtained by scraping public LinkedIn profiles with automated bots. In 2017, LinkedIn sent a demand letter to hiQ asserting that hiQ’s scraping activity was in violation of the CFAA, the Digital Millennium Copyright Act (DMCA), the California penal code and common law. HiQ immediately filed suit seeking injunctive relief and a declaratory judgment that LinkedIn could not lawfully invoke the asserted claims. Granting hiQ’s motion for the preliminary injunction, the district court ordered LinkedIn to remove, and to refrain from implementing, any technical barriers to hiQ’s access to the LinkedIn public profiles.

The Ninth Circuit stated that a plaintiff seeking a preliminary injunction must establish the following:

  • It is likely to succeed on the merits.
  • It is likely to suffer irreparable harm absent the injunction.
  • The balance of equities tips in its favor.
  • The injunction is in the public interest.

This analysis required the Ninth Circuit to focus only on whether hiQ had raised serious questions on the merits of the factual and legal issues presented. The Ninth Circuit’s re-examination of these factors was nearly identical to its 2019 holding.

Starting with irreparable harm, the Ninth Circuit found that the survival of hiQ’s business was threatened since it depends on being able to access public LinkedIn member profiles. The Court also agreed, once again, with the district court’s determination that the balance of the equities tipped in hiQ’s favor. The Court found that the privacy interests of individuals who have opted to maintain a public LinkedIn profile did not outweigh hiQ’s interests in continuing its business. On this factor, the Court noted that “little evidence” suggested that LinkedIn users who choose to make their profiles public actually maintain an expectation of privacy with respect to publicly posted information. The Court also noted that LinkedIn does not own its users’ data, since users retain [...]

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The Perils of Falling in Love

The US Court of Appeals for the Second Circuit affirmed the dismissal of a lawsuit that sought a declaratory judgment on the basis that a notice of termination of copyright assignment under 17 U.S.C. § 203 did not validly terminate a 1983 grant of rights in the copyright. Valentina M. Peretti Acuti, et al. v. Authentic Brands Group, LLC, et al., Case No. 21-2174 (2d Cir. May 4, 2022) (Livingston, C.J.; Lynch, Lohier, JJ.)

Hugo Peretti co-wrote “Can’t Help Falling in Love,” a ballad popularized by Elvis Presley in 1961, and registered the composition with the US Copyright Office the same year. In 1983, Peretti, his wife and his daughters transferred their contingent rights and interest in the renewal term of the copyright to Julian and Jean Aberbach, predecessors-in-interest to Authentic Brands. Under the Copyright Act of 1976 (1976 Act), the renewal rights would not vest until the original term of the copyright expired in 1989 (28 years after the copyright was registered, under the Copyright Act of 1909, which applied to the initial term of the copyright because of its registration in 1961). Peretti died in 1986, before the renewal rights vested. His family registered the renewal of the copyright in 1989.

In 2014, Peretti’s widow and his daughter Valentina served a notice on Authentic Brands to terminate the 1983 assignment under 17 U.S.C. § 203. Section 203 provides for the right to terminate a grant executed by the author at any time during a five-year period beginning at the end of 35 years from the date of execution of the grant. Authentic Brands contested the effectiveness of the termination, and Valentina filed a lawsuit seeking a declaratory judgment that the termination was properly effectuated. The district court dismissed the claim, holding that Valentina had no right to terminate the assignment because the rights to the renewal term that were transferred were those of Valentina and her mother, which had vested upon expiration of the original copyright term. The district court held that § 203 provides termination rights only to post-1978 grants executed by an author and, therefore, Peretti’s widow and daughter’s rights to the renewal were not subject to termination under that provision. Valentina appealed.

The Second Circuit began with a discussion of § 203 of the Copyright Act, which applies only to grants executed by the author on or after January 1, 1978. The Court noted that the appeal hinged on the meaning of “executed by the author.” The 1976 Act provides that execution of a transfer of a copyright is not valid unless an instrument of conveyance is in writing and signed by the owner of the rights conveyed. Thus, as the Second Circuit explained, a grant “executed by the author” is a grant that is documented in writing, is signed by the author and conveys rights owned by the author.

Turning to the Peretti 1983 assignment, the Second Circuit explained that at the time the assignment was executed, ownership of the copyright in the composition [...]

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Re-Poster Child for § 230: Immunity under the CDA for Reposting Content of Another

The US Court of Appeals for the First Circuit affirmed a district court’s decision to dismiss claims for defamation under the Communications Decency Act (CDA), 47 USC § 230, and for copyright infringement under the fair use doctrine. Monsarrat v. Newman, Case No. 21-1146 (Kayatta, Lipez, Gelpí, JJ.).

The parties’ dispute arose from a series of posts on a community message board. Residents of the Davis Square neighborhood in Massachusetts maintained a Live Journal forum for several years. In response to a revision of the Live Journal terms of service in 2017, Ron Newman, a member of the community, copied the entirety of the content from the Live Journal forum to another online platform: Dreamwidth. The copied content included a series of allegedly defamatory posts about Jonathan Monsarrat and a post that Monsarrat had copyrighted. Monsarrat sued Newman for both defamation and copyright infringement. Newman moved to dismiss the defamation claim under the CDA, § 230, and the copyright claim under the fair use doctrine. After the district court granted the motions, Monsarrat appealed.

The First Circuit first addressed the defamation claim under § 230. Newman argued that § 230 provided him immunity from defamation. Specifically, § 230 states “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” It also provides a shield from state law claims that would be “inconsistent with this section.” Courts apply a three-part analysis to determine whether a defendant is entitled to immunity under § 230:

  1. Is the defendant a “provider or user of an interactive computer service”?
  2. Is the claim based on “information provided by another information content provider”?
  3. Does the claim treat the defendant “as the publisher or speaker” of that information?

Monsarrat did not challenge the fact that Newman was a “user” under the first prong. Regarding the second prong, the analysis hinged on whether Newman was an “information content provider,” which in turn relied on whether Newman was responsible for the allegedly defamatory content in whole or in part. The factual record showed that Newman did nothing but copy the allegedly defamatory posts that had been created by another. Monsarrat unsuccessfully argued that Newman was responsible because Newman copied the posts from Live Journal to a different digital platform with an allegedly different audience. The First Circuit was not persuaded, ruling that providing essentially the same content on a different platform did not make a defendant responsible for that content under § 230. Regarding the third prong, Monsarrat’s complaint clearly alleged that Newman was acting as a publisher. The Court affirmed the dismissal of the defamation claim under § 230.

Monsarrat’s copyright claim related to a Live Journal post by Monsarrat in the Davis Square forum. He had created a post with a link to Live Journal’s harassment policy, a quotation from the policy and a brief message regarding his attempts to report the abuse he felt he had suffered by other [...]

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Supreme Court to Consider Fair Use and Transformative Works of Art

The Supreme Court of the United States agreed to consider the application of the fair use doctrine as it relates to transformative works. The Andy Warhol Foundation v. Goldsmith, Case No. 21-869 (Supr. Ct. Mar. 28, 2022) (certiorari granted).

In a case touching the estates of two of the world’s best-known artists, the US Court of Appeals for the Second Circuit held that a series of prints and illustrations of the musical artist Prince created by the visual artist Andy Warhol were substantially similar to a 1981 portrait photograph of Prince taken by the photographer Lynn Goldsmith. The Andy Warhol Foundation for the Visual Arts, Inc. v. Lynn Goldsmith, et al., Case No. 19-2420-cv (2d Cir. Mar. 26, 2021) (Lynch, J.) (Sullivan, J., joined by Jacobs, J., concurring) (Jacobs, J., concurring). The Andy Warhol Foundation petitioned the Supreme Court for review of the decision.

The question presented is as follows:

Whether a work of art is “transformative” when it conveys a different meaning or message from its source material (as this Court, the Ninth Circuit, and other courts of appeals have held), or whether a court is forbidden from considering the meaning of the accused work where it “recognizably deriv[es] from” its source material (as the Second Circuit has held).




So You Wanna Play with Copyright? “Joyful Noise” Ostinato Isn’t Original Expression

The US Court of Appeals for the Ninth Circuit affirmed a district court’s order vacating a jury award of damages for copyright infringement and granting judgment as a matter of law, explaining that the musical work alleged to have been copied did not qualify as an original work of authorship but consisted only of “commonplace musical elements.” Marcus Gray PKA Flame et al. v. Katheryn Elizabeth Hudson PKA Katy Perry et al., Case No. 20-55401 (9th Cir. Mar. 10, 2022) (Clifton, Smith, Watford, JJ.)

Key Definitions:

  • A musical scale is a sequence of musical notes or tones by pitch.
  • A subset of seven notes is called the minor scale and can be referred to with alphabetic names (A, B, C, etc.) or scale degrees (1, 2, 3, etc.).
  • An ostinato is a repeating musical figure (for example, 3-3-3-3-2-2).

In 2007, Marcus Gray (Flame) purchased an ostinato and used it in the song “Joyful Noise.” The song was released in 2008. While “Joyful Noise” did not achieve significant commercial success or airtime, it received millions of views online. In 2013, American singer-songwriter Katy Perry created “Dark Horse,” which was a hit, resulting in her performance at the Super Bowl halftime show in 2015.

The “Joyful Noise” ostinato consists of notes, represented as 3-3-3-3-2-2-2-1 and 3-3-3-3-2-2-2-6, whereas Dark Horse’s ostinato contains 3-3-3-3-2-2-1-5. Both have a uniform rhythm and equal note duration in time.

Plaintiffs sued Perry and her co-defendants for copyright infringement. Plaintiffs presented circumstantial evidence that the defendants had a reasonable opportunity to access “Joyful Noise” and that the ostinatos in both songs were substantially similar. Plaintiffs did not present direct evidence that Perry and the others had copied elements of the song, instead relying on testimony from their expert musicologist, Dr. Todd Decker.

Decker testified that the ostinatos were similar in many aspects, but he also testified that there was no single element that caused him to believe the ostinatos at issue were “substantially similar” when viewed “in isolation.” The jury also heard testimony from Perry’s expert, who disagreed altogether that the ostinatos were substantially similar.

The jury found that the defendants had a reasonable opportunity to hear “Joyful Noise” before composing “Dark Horse,” that the two songs contained substantially similar copyrightable expression and that “Dark Horse” used protected material from “Joyful Noise.” The jury found the defendants liable for copyright infringement and awarded $2.8 million in damages. The district court vacated the award and granted judgment as a matter of law to defendants, concluding that the evidence at trial was legally insufficient to show that the “Joyful Noise” ostinato was a copyrightable original expression. The plaintiffs appealed.

The Ninth Circuit explained that because the plaintiffs did not present any direct evidence that the defendants copied the “Joyful Noise” ostinato, they were required to show that the defendants had access to the work and that the ostinatos were substantially similar.

The Ninth Circuit began with its analysis [...]

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Copyright Claims Board Clarifies Service Rules and Opt-Outs

The US Copyright Office issued two final rules for how companies can designate agents to receive claims and how libraries can preemptively opt out of claims before the Copyright Claims Board (CCB). The agency has been drafting rules governing the CCB since it was established in 2020. The new venue is designed to serve as an alternative forum where parties may voluntarily seek to resolve certain copyright claims regarding any category of copyrighted work.

Companies Can Designate Subsidiaries as Agents of Service

Section 37 CFR § 222.6 (Designated service agents) becomes law effective April 7, 2022. This forthcoming rule will allow corporations, partnerships and unincorporated associations to use the same designated agent for process of service for separate legal entities under their direct or indirect common control. This rule will also allow companies with many subsidiaries to designate one service agent for each of its affiliates.

Libraries and Archives Can Preemptively Opt Out

Section 37 CFR § 223.2 (Libraries and archives opt-out procedures) becomes law effective April 8, 2022. Under this new law, a library or archive that wishes to preemptively opt out of participating in CCB proceedings may do so by submitting written notification to the CCB. The notification must certify that the library or archive qualifies for the limitations on exclusive rights under 17 U.S.C. 108, which provides that it is not an infringement of copyright for a library or archive, or any of its employees acting within the scope of their employment, to reproduce a single copy of a work under certain conditions.

Class Action Opt-Out Procedures

Section 37 CFR § 223.3 (Class action opt-out procedures) becomes law effective April 8, 2022. Under the new law, if a party to an active CCB proceeding receives notice of a pending or putative class action arising out of the same transaction or occurrence as the proceeding before the CCB in which the party is a class member, that party may either opt out of the class action or seek written dismissal of the proceeding before the CCB within 14 days of receiving notice of the pending class action.




Paradise Lost: Art Created by AI Is Ineligible for Copyright Protection

The US Copyright Office Review Board (“Board”) rejected a request to register a computer-generated image of a landscape for copyright protection, explaining that a work must be created by a human being to obtain a copyright. Second Request for Reconsideration for Refusal to Register A Recent Entrance to Paradise (Copyright Review Board Feb. 14, 2022) (S. Perlmutter, Register of Copyrights; S. Wilson., Gen. Counsel; K. Isbell, Deputy Dir. of Policy).

In 2018, Steven Thaler filed an application to register a copyright in a work named “A Recent Entrance to Paradise.” Thaler listed as the author of the work the “Creative Machine,” a computer algorithm running on a machine. Thaler listed himself as a claimant and sought to register the work as a “work-for-hire” as the “owner” of the Creative Machine. The Board refused to register the work, finding that it lacked the necessary human authorship. Thaler requested reconsideration, arguing that the “human authorship requirement is unconstitutional and unsupported by either statute or case law.”

After reviewing the work a second time, the Board found that Thaler provided no evidence of sufficient creative input or intervention by a human author. The Board refused to abandon its longstanding interpretation of the Copyright Act, as well as Supreme Court and lower court precedent, that a work meets the requirements of copyright protection only if it is created by a human author. The Board concluded that “A Recent Entrance to Paradise” lacked the required human authorship and therefore affirmed refusal to register. Thaler filed for a second reconsideration.

The Board found that Thaler’s second request for consideration repeated the same arguments as his first request. Relying on the Compendium of US Copyright Office Practices (the Office’s practice manual), the Board found that Thaler provided neither evidence that the work was a product of human authorship nor any reason for the Board to depart from more than a century of copyright jurisprudence.

The Board explained that the Supreme Court of the United States, in interpreting the Copyright Act, has described a copyright as the exclusive right of a human and her own genius going back to 1884. The Board noted that the Supreme Court has repeatedly articulated the nexus between the human mind and creative expression as a prerequisite for copyright protection. The human authorship requirement is further supported by the lower courts. For example, in 1997 the US Court of Appeals for the Ninth Circuit held in Urantia Found. v. Kristen Maaherra that a book containing words “‘authored’ by non-human spiritual beings” can only gain copyright protection if there is “human selection and arrangement of the revelations.”

The Board further explained that federal agencies have followed the courts. In the 1970s, the National Commission on New Technological Uses of Copyrighted Works (CONTU) studied the creation of new works by machines. CONTU determined that the requirement of human authorship was sufficient to protect works created with the use of computers and that no amendment to copyright law was necessary. CONTU explained that “the eligibility of [...]

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2022 IP Outlook Report: The Developments Shaping Copyright Law

Key Takeaways and Outlook for 2022

Like so many things in 2021, a few long-awaited copyright developments have spilled into 2022, with anticipated amendments to key provisions in the Digital Millennium Copyright Act topping the list of legislation to watch.

The key issues we are tracking include the following:

  1. Proposed Changes to the Digital Millennium Copyright Act
  2. The Fair Use Doctrine in Light of Google LLC v. Oracle America, Inc.
  3. Transformativeness in Fair Use under The Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith
  4. Unicolors and H&M Hennes & Mauritz Face Off in SCOTUS Infringement Dispute
  5. Copyright Alternative in Small-Claims Enforcement Act: A Venue and a Less-Complex Process in Sight in 2022

Read the full report.




Change the Look of the Room: Appeal Transferred to Federal Circuit

The US Court of Appeals for the Second Circuit transferred an appeal of a preliminary injunction enjoining alleged copyright and trademark infringement to the US Court of Appeals for the Federal Circuit because the operative complaint included six counts of patent infringement and thus arose under patent law. Hudson Furniture, Inc. et al. v. Lighting Design Wholesalers Inc., Case No. 20-3299 (2d Cir. Dec. 21, 2021) (Livingston, CJ; Kearse, Lee, JJ.) (per curiam).

Hudson filed a complaint against Lighting Design alleging patent, trademark and copyright infringement. The district court granted Hudson’s preliminary injunction and enjoined Lighting Design from alleged infringement of Hudson’s copyrights and trademarks. The district court also denied Lighting Design’s motion to dismiss for lack of personal jurisdiction and its motion for reconsideration permitting alternative service of process. Lighting Design appealed the rulings to the Second Circuit.

Hudson asked the Second Circuit to dismiss the appeal, arguing that the appeal arose from a complaint involving patent law claims and thus fell under the exclusive jurisdiction of the Federal Circuit. Under 28 U.S.C. §§ 1292 and 1295, the Federal Circuit has exclusive jurisdiction over interlocutory appeals involving any action that arises under any act of US Congress relating to patents. An action arises under patent law when a well-pleaded complaint establishes that (1) federal law creates the cause of action or (2) the plaintiff’s right to relief necessarily depends on resolution of a substantial question of federal patent law.

The Second Circuit agreed that exclusive jurisdiction rested with the Federal Circuit, explaining that the operative complaint included six counts of patent infringement, and the appeal concerned the district court’s ruling on a motion for injunctive relief involving patent law and non-patent law claims. The Court rejected Lighting Design’s argument that patent law did not constitute a substantial part of the overall success of the case since Hudson failed to secure preliminary injunctive related to the patent law claims. The Court explained that Lighting Design’s argument focused on only the second basis for Federal Circuit jurisdiction (whether the right to relief depends on a “substantial question” related to patent law). The Court found that even if it accepted Lighting Design’s argument, the fact that federal patent law created the cause of action was sufficient to establish Federal Circuit jurisdiction under the first basis of jurisdiction. While the Second Circuit agreed with Hudson, it declined to dismiss the appeal and instead opted to transfer the appeal to the Federal Circuit because the original appeal was timely filed in good faith and transferring the appeal was in the interest of justice.




Copyright Office Solicits Comments on Deferred Examination Option

The US Copyright Office announced a public study to evaluate the merits of providing an option to defer examination of copyright registration materials until a later request by the applicant. Deferred Registration Examination Study: Notice and Request for Public Comment, 86 Fed. Reg. 70540 (Dec. 10, 2021). To aid in the effort, the Copyright Office is soliciting public comments, which are due by January 24, 2022.

Copyright protection automatically attaches to an original work of authorship as soon as it’s created and fixed in tangible form. Although registration is optional, the US Copyright Act provides significant incentives to encourage registration, which only occurs after the Copyright Office examines the work and determines that it is copyrightable. This process can often take many months. In 2019, the Supreme Court of the United States held that a lawsuit for copyright infringement can be brought only after the Copyright Office registers the copyright. Fourth Estate v. Wall-Street.com, Case No. 17-571 (US March 4, 2019) (Ginsburg, Justice).

There is currently no option to delay or defer examination of submitted application materials. In an effort to modernize its technological infrastructure, the Copyright Office has previously solicited public input concerning the registration process. Respondents have submitted various proposals involving a deferred examination proceeding, some of which included:

  • Allowing applicants to submit application materials at a discounted fee
  • Delaying examination but still intaking information about the work into the public catalog
  • Allowing formal examination to determine whether the work should be registered at a later time for an additional fee
  • If the work is registered, attaching statutory benefits with an effective date of when the original materials were received.

Commenters have indicated that benefits of permitting deferred examination include more registrations, more timely registrations, expansion of the public record, improved efficiency by removal of the examination step, decreased processing times, lower expenses and more deposits available for the Library of Congress’s collections.

In May 2021, Senator Thom Tillis, the ranking member of the Senate Judiciary Subcommittee on Intellectual Property, sent a letter to the Copyright Office requesting a study on the feasibility, benefits and costs of creating a deferred examination option for an application, including whether an applicant can obtain an effective date of registration upon submission and deposit while choosing to defer examination until a later time. He also asked the Copyright Office to consider whether statutory changes might be necessary to enable such an option.

In order to assess the viability of including a deferred examination option, the Copyright Office is inviting written comments on various subjects, including:

  • The deficiencies in the current registration process
  • The potential benefits and drawbacks of a deferred examination option
  • The possible legal or regulatory framework for the option
  • The impact of such an option on the Copyright Office, the Library and the ability to bring a lawsuit based on Fourth Estate
  • Whether the same goals that deferred examination is meant to achieve could be accomplished through alternative [...]

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