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IP Implications of the Consolidated Appropriations Act, 2021

On December 27, 2020, Congress signed the Consolidated Appropriations Act, 2021, into law. The omnibus act includes new legislation affecting patent, copyright and trademark law. A brief summary of key provisions is provided below. Patents – Section 325 Biological Product Patent Transparency 42 USC § 262(k) was amended to require that the US Food and Drug Administration (FDA) provide the public with more information about patented biological products. Within six months, the FDA must make the following information available to the public on its Database of Licensed Biological Products or “Purple Book,” and it must update the list every 30 days: A list of each biological product, by nonproprietary name, for which a biologics license is in effect The license date and application number The license and marketing status (as available) Exclusivity periods The amendment requires that the holders of a license to market a biologic drug now disclose all patents...

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Government Contractors May Include Restrictive Markings on ‘Unlimited Rights’ Data

The US Court of Appeals for the Federal Circuit reversed an Armed Services Board of Contract Appeals (ASBCA) denial of summary judgment and held that a federal contractor may include certain restrictive markings on “unlimited rights” data supplied to the US government. The Boeing Company v. Secretary of the Air Force, Case No. 19-2147 (Fed. Cir. Dec. 21, 2020) (Lourie, J.) Boeing entered into two contracts with the US Air Force that required Boeing to deliver technical data to the Air Force with “unlimited rights” pursuant to Defense Federal Acquisition Regulation Supplement 252.227-7013 (-7013 clause). Boeing marked each technical data deliverable submitted to the Air Force with a legend that described Boeing's data rights pertaining to third parties. The government rejected Boeing's technical data deliverables in view of the legend Boeing placed on the data, and Boeing requested a Contracting Officer Final Decision (COFD) regarding the propriety of its...

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This Mashup Is Not a Place You’ll Go – Seuss Copyright Will ‘Live Long and Prosper’

Presented with a publishing company defendant's mashup of Dr. Seuss' copyrighted works with Star Trek in a work titled Oh, the Places You'll Boldly Go!, the US Court of Appeals for the Ninth Circuit tackled claims of both copyright and trademark infringement, including the defense of fair use and the use of trademarks in expressive works. The Ninth Circuit reversed the district court's summary judgment in favor of defendants on the copyright infringement claim and affirmed the district court's dismissal and grant of summary judgment in favor of defendants on the trademark claim. Dr. Seuss Enterprises, L.P. v. ComicMix LLC, et al., Case No. 19-55348 (9th Cir. Dec. 18, 2020) (McKeown, J.) Seuss Enterprises owns the intellectual property in the works of late author Theodor S. Geisel, better known as Dr. Seuss. Seuss Enterprises carefully yet prolifically licenses the Dr. Seuss works and brand across a variety of entertainment, media, art and consumer goods,...

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Two Turntables, No Microphone: Using Technical Diagram Is Not Copyright Infringement

The US Court of Appeals for the Sixth Circuit affirmed a district court's summary judgment grant with respect to a copyright infringement claim related to technical drawings, and reversed the court's summary judgment grant related to software source code. RJ Control Consultants, Inc. et al. v. Multiject, LLC, et al., Case No. 20-1009 (6th Cir. Nov. 23, 2020) (Donald, J.) In 2008, Paul Rogers, through his company RJ Control Consultants (RJC), entered into an oral agreement with his friend Jack Elder, through Elder's company Multiject. Rogers agreed to develop a rotary turntable control system (not for music, but to control a molding system) for Elder, calling the product “Design 3." In 2014, Elder asked Rogers for copies of Design 3's technical diagrams as well as the software source code “in case something happened" to Rogers. Rogers provided the information to Elder, believing that Elder would not improperly use or disclose the information to others. Three...

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By the Book: Unauthorized Material Doesn’t Forfeit Training Guide’s Copyright Protection

The US Court of Appeals for the Sixth Circuit affirmed a jury verdict in favor of a copyright owner in a lawsuit alleging infringement of the copyright in a home-services training manual, finding that the jury was correctly instructed that a work’s incorporation of some copyrighted content does not invalidate the copyright in the work’s original parts. Hiller LLC v. Success Grp. Int’l Learning Alliance LLC, Case No. 19-6115 (6th Cir. Sept. 23, 2020) (Suhrheinrich, J.). Hiller is a home-services company providing HVAC services. Hiller was a paying member of Success Group International, which offered customer service training to home services companies. Success Group conducted training courses using manuals copyrighted by its owner, Clockwork Home Services. Hiller sent its employees to Success Group’s courses and had access to the manuals. Clockwork later sold Success Group to another company, but retained ownership of the copyrights in the manuals and granted...

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“Can’t Hold Us” Liable: Macklemore & Ryan Lewis Win Affirmance in Copyright Suit

The US Court of Appeals for the Fifth Circuit affirmed a grant of summary judgment on the issue of copyright infringement and an award of attorneys’ fees against the plaintiff under the Copyright Act. Although the Court noted that it lacked jurisdiction to review sanctions against the plaintiff’s attorney, it observed that counsel went beyond “vigorous representation.” Batiste v. Lewis, Case Nos. 19-30400, -30889 (5th Cir. Sept. 22, 2020) (Clement, J.). Batiste, a local musician, sued Macklemore & Ryan Lewis, an internationally famous hip-hop duo, for copyright infringement. Batiste alleged that the duo sampled his songs without authorization. As support, Batiste submitted the expert report of a musicologist, Milton, but Milton later admitted that Batiste had conducted the analysis and written the report, and that Milton did not even have access to the necessary software. The district court excluded the report, which Batiste then sought leave to resubmit...

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Jersey Boys Don’t Cry: No Copyright Protection for Facts “Based on a True Story”

The US Court of Appeals for the Ninth Circuit affirmed a district court’s grant of judgment as a matter of law finding that the musical Jersey Boys did not infringe a copyright held in an autobiography of band member Tommy DeVito. Donna Corbello v. Frankie Valli, et al., Case No. 17-16337 (9th Cir. Sept. 8, 2020) (Berzon, J.). In the 1990s, Rex Woodard ghostwrote an autobiography of Tommy DeVito, one of the original members of the 1950s quartet the Four Seasons. Woodard and DeVito agreed to split the profits equally. However, shortly after finishing the book, and before finding a publisher, Woodard died. Donna Corbello, Woodard’s widow, became the successor-in-interest to the book, and she continued the search for a publisher. Almost 15 years later, Corbello still had not published the book. DeVito’s autobiography reads as a straightforward historical account of the Four Seasons. At the beginning of the book, DeVito, as the narrator, describes his...

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No Remix: Copyright Act Preempts Right of Publicity Claim

The US Court of Appeals for the Second Circuit found that the federal Copyright Act preempts a state right of publicity claim when the latter is merely “a thinly disguised effort to exert control over an unauthorized [use of a copyrighted] work.” Jackson v. Roberts, Case No. 19-480 (2d Cir. Aug. 19, 2020) (Leval, J.). Both parties in this case are famous hip-hop artists more commonly known by their stage names: the plaintiff, Curtis James Jackson III, is known as 50 Cent, and the defendant, William Leonard Roberts II, is known as Rick Ross. In 2015, Roberts released a free mix tape that included samples from many famous songs, including Jackson’s hit “In Da Club.” The mix tape track at issue was titled “In Da Club (Ft. 50 Cent)” and included Rick Ross rapping over the “In Da Club” instrumentals, a 30-second sample of 50 Cent singing the “In Da Club” refrain, and multiple references to Rick Ross’s upcoming album. Jackson sued Roberts, claiming that the...

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Not Your Grandfather’s Internet Royalties? DMCA Favorable Rates Might Apply to Internet Offerings

Reversing the Copyright Royalty Board’s determination that a favorable grandfathered royalty rate did not apply to internet streaming audio transmissions, the US Court of Appeals for the District of Columbia Circuit concluded that internet transmissions are not categorically excluded from the definition of “service” in the Digital Millennium Copyright Act of 1998 (DMCA). Music Choice v. Copyright Royalty Bd., Case No. 19-1011 (DC Cir. Aug. 18, 2020) (Rao, J.). In the late 1990s, Music Choice, a company best known for its cable television genre-specific music channels, also offered some digital audio transmissions over the internet. These audio transmissions—and their alleged continuation through today—are the subject of this case. Seeking to establish a new regime governing royalties for digital music services, Congress required in the DMCA that service providers pay copyright holders a market-based rate for playing digital music, but set a generally lower...

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Use of Infringing Product, Misappropriated Trade Secrets May Continue—for a Licensing Fee

The US Court of Appeals for the Sixth Circuit affirmed a district court’s stay of a permanent injunction against copyright infringement and trade secret misappropriation, permitting the infringer to continue use of an infringing product and misappropriated trade secrets but requiring the infringer to pay a licensing fee. ECIMOS, LLC v. Carrier Corp., Case Nos. 19-5436, -5519 (6th Cir. Aug. 21, 2020) (Boggs, J.). Carrier sold HVAC systems. ECIMOS designed and sold a quality-control-testing system that assessed each HVAC unit at the end of Carrier’s assembly line. ECIMOS’s system consisted of a software program, associated hardware and a database that stored results of runtests performed by the system. Carrier paid ECIMOS to maintain and periodically upgrade its software system. ECIMOS licensed Carrier to use the system but prohibited unauthorized copying, distributing or creating derivative works based in whole or in part on the software. Years into the...

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