I’ll be working on a project that will monopolize my blogging time until the first of August. Thanks to everyone who has stopped by.
Monthly Archives: July 2009
Australian court finds that use of four bars of a musical composition on a wine label constitutes infringement
Filed under Australia, Damages, Right of Publicity
Rutter v Brookland Valley Estate Pty Limited [2009] FCA 702 (30 June 2009)
There are a number of new copyright decisions issued in Australia over the last couple of weeks that look worthy of a mention. The plaintiff in Rutter v. Brookland was an internationally renowned flautist. The defendant was a winery that launched a brand marketed around the flute-playing Greek God Pan. The winery asked the plaintiff flautist to compose an original piece of music that would be included on a promotional CD; perform a series of shows to market the wine; and provide the winery with manuscript of the original composition for reproduction on the wine series’ label. The flautist agreed to license her composition and name for promotional purposes for a twelve month period.
The winery continued to use twelve bars of the composition on its wine labels after the expiration of the licensing agreement. It later revised the wine label to include four bars of the composition. The Honourable Justice Buchanan found that the winery infringed the flautist’s copyright in her musical composition by continuing to produce and distribute labels that included the composition. The Court found that both the label that incorporated the twelve bar section and the label that included the four bar section were infringing.
The test for improper appropriation
In American copyright law, the concept of improper appropriation — that in addition to showing a unauthorized taking, a copyright owner must show that a defendant took too much of a work — isn’t explicitly incorporated into the Copyright Act. 17 U.S.C. 501(a) states that anyone who violates any of the exclusive rights of a copyright owner . . . is an infringer . . .” Courts were left by Congress to formulate the standards for determining whether a particular use is potentially liable.
The concept that the appropriation of a small but qualitatively important portion of a preexisting work may constitute copyright infringement was incorporated into American law by Justice Story in his opinion in Folsom v. Marsh. 9 F.Cas. 349. No. 4901 (C.C.D. Mass. 1841) (Whether a use is infringing does “not necessarily depend on upon the quantity taken . . . “)
The standard for improper appropriation in Australian copyright law is partially set forth in Section 14(1) of the Copyright Act, which states that a person infringes a preexisting work when they use a “substantial part” of a “work or other subject-matter.” The Court in Rutter interpreted the phrase “substantial part” as referring to a qualitative analysis instead of a quantitative analysis. Citing Autodesk Inc v Dyason [No. 2] [1993] HCA 6; (1993) 176 CLR 300, 305 (Mason CJ):
It is clear that the phrase ‘substantial part’ refers to the quality of what is taken rather than the quantity … in determining whether the quality of what is taken makes it a ‘substantial part’ of the copyright work, it is important to inquire into the importance which the taken portion bears in relation to the work as a whole: is it an ‘essential’ or ‘material’ part of the work?
In Rutter, the Court found that both the twelve bar section of the flautist’s composition that was included on the original wine label, and the four bar section used on the revised label, were “immediately recognisable” excerpts that were “significant, essential and material part[s] of the composition.”
Statute of limitations
The Court applied a six year statute of limitations from the date of injury and limited the scope of the claim to infringement that occurred in the six years proceeding the filing of the complaint. Section 134(1) of the Australian Copyright Act states that no infringement action may be “brought for infringement after the expiration of six years from the time when the infringement took place . . . ”
As a comparison, the United States Copyright Act provides that “[n]o civil action shall be maintained under the provisions of [the Copyright Act] unless it is commenced within three years after the claim accrued.” 17 U.S.C. 507(b). The Act doesn’t explicitly define when a claim accrues. A majority of U.S. Courts have interpreted the limitations period as a discovery rule, beginning to run when a plaintiff either discovered or with due diligence should have discovered the injury; although, some courts have considered the limitations period as beginning to run on the point of injury, similarly to the limitations provision of the Australian Copyright Act.
Damages
Section 115(2) and of the Australian Copyright Act provides that a court may grant a plaintiff in an infringement suit an injunction and either damages or accounting of profits. The flautist in Rutter elected actual damages, in lieu of an accounting of profits, so the Court used the original license between the parties to calculate an average royalty per bottle of wine sold, and then multiplied the rate by the number of bottles sold by the winery that used the label in the last six years.
The Court also awarded additional damages. Section 115(4) of the Australian Copyright Act gives a Court discretion to award additional damages in circumstances when infringement is (i) flagrant, or (ia) there is a need for deterrence of similar infringement, or (ib) a defendant doesn’t respond with appropriate conduct after it is informed of the infringement,or (iii) the defendant benefited from the infringement.
Section 115(4) to a certain extent makes damages under the Australian Copyright Act similar to actual damages in the American Copyright Act, with the exception that the American Copyright Act doesn’t allow a Court to access additional damages for willful infringement unless a plaintiff elects statutory damages. 17 U.S.C. 504 grants a plaintiff the choice to elect actual damages and additional profits of the infringer. The Australian Copyright Act forces a defendant to elect either actual damages or additional profits, but a Court can in its discretion award additional damages if a plaintiff benefits from the infringement.
Moral rights and false endorsement
The plaintiff also claimed damages should be accessed for the defendant’s violation of her moral right to attribution. The Court found that violation of moral rights did not increase the flautists losses, and that since there is no “double counting” of damages for violation of moral rights, it had already accessed the appropriate additional damages.
The plaintiff also argued that it should receive additional copyright damages for the flautist’s personal association with the musical composition used on the label. The Court found that there was no inference of personal endorsement raised merely by the use of the musical composition on the wine labels and that it wasn’t appropriate or necessary to add additional damages. The decision in Harolds Stores, Inc. v. Dillard Dept. Stores, Inc., 82 F.3d 1533 (10th Cir. 1996) aside, most American courts have found that a plaintiff will not be awarded damages for loss of goodwill or consumer confusion for a copyright claim. Loss of goodwill or consumer confusion is traditionally the province of a state law claim based on a right of publicity or a trademark claim, if and when the claims aren’t preempted, and is not an appropriate basis for awarding damages for a claim brought under the Copyright Act, which targets unauthorized infringement, not unauthorized endorsement.
Court grants protective order against further discovery of past conduct in Cambridge University Press v. Becker
Filed under Discovery, Sovereign Immunity
Cambridge University Press v. Becker, 08-CV-1425-ODE (N.D. Ga. 2009)
There was an update last week in Cabridge University Press v. Becker, a case that is to my knowledge the first large-scale infringement suit brought against an institution of higher education. A group of publishers alleged that Georgia State University facilitated the infringing online distribution of their works.
The plaintiffs made the tactical decision to only seek an injunction and declaratory judgment, not damages. As a state institution, the publishers are likely barred from seeking money damages against the employees due to sovereign immunity, conferred by the Eleventh Amendment. We discussed this topic a couple of months ago in Frank Romero v. California Department of Transportation, 2009 WL 650629 (C.D. Cal. 2009) (unpublished). Following the filing of the complaint, Georgia State University adopted a new copyright policy that its counsel argued has rendered moot any claims based on its past-conduct.
At bar, Georgia State University sought a protective order that future discovery should be limited to its “ongoing and continuous conduct.” Plaintiffs argued that further discovery of past practices was releveant because it needed to show infringement to be awarded an injunction, and because it thought that the new copyright policy was inadequate.
Judge Evans granted the Defendant a protective order, finding that the Plaintiffs had conducted sufficient discovery to present evidence of past infringement.
Additional discovery in to these past practices, at this point would be unduly burdensome. Even if the new copyright policy fails to address the alleged problems in the old policy, Plaintiffs will have had sufficient discovery to argue that there is no significant difference between the two.
Salinger wins preliminary injunction against the release of Catcher follow-up
Filed under Fair Use
Salinger v. Colting, 09 civ 5095-DAB (S.D.N.Y. 2009)
The big news in copyright from the holiday weekend was a fair use decision issued in the Southern District of New York. Author J.D. Salinger alleged that a book 60 Years Later: Coming Through the Rye infringed his celebrated work The Catcher in the Rye. In the motion at bar, Salinger sought to preliminarily enjoin the Defendant from the distribution and promotion of its work. The Court found that Salinger was likely to succeed on the merits of his copyright claim and granted the injunction.
On whether 60 Years was a parody of The Catcher
The Court found that 60 Years didn’t contain a reasonably perceivable parodic character because its “plain purpose [was] not to expose Holden Caufield’s disconnectedness, absurdity, and ridiculousness, but rather to satisfy Holden’s fans’ passion for Holden Caufield’s disconnectedness, absurdity, and ridiculousness, which Catcher has raised into the realm of protectable creative expression.”
On whether 60 Years was a Parody of Salinger
The Defendant incorporated J.D. Salinger, the author himself, as a character in 60 Years. The Defendant claimed that the inclusion of the character parodied Salinger, and by proxy, Catcher in the Rye. The Court ostensibly drew a hard line between commenting on an author’s preexisting works and commenting on the author himself:
Campbell and its progeny define the limits of parody to include only those elements that criticize or comment upon the source author’s works, rather than the author himself. Campbell at 580 (“the hear of any parodist’s claim to quote from existing material, is the use of some of the prior author’s composition to create a new one that, at least in part, on that author’s works.”) (emphasis added); id. at 597 (Kennedy, J., concurring); (“. . . parody may qualify only as fair use only if it draws upon the original composition to make humorous or iconic [sic] commentary about that same composition.”) (emphasis added); see also, Suntrust Bank, 268 F.3d at 1268 (“For purposes of our fair use analysis, we will treat a work as a parody if its aim is to comment upon or criticize a prior work . . . “) (emphasis added); Dr. Seuss Enterprise, L.P. v. Penguin Books USA, Inc., 924 F.Supp. 1559, 1569 (S.D. Cal. 1996) (“Courts have allowed claims only where there was a discernable direct comment on the original.”) (emphasis added.)
The Court found that the Defendant’s use of Salinger as a character in order to criticize the author’s alleged propensity to exercise “iron-clad control over his intellectual property, refusing to allow others to adapt any of his characters in other media,” was at most a tool with which to criticize and comment on the author, J.D. Salinger and his idiosyncrasies.” It did not, the Court stated, “direct the criticism toward Catcher and Caufield themselves, and thus is not an example of parody.”
17 U.S.C. 107 factors
(1) Purpose and character: The Court found that the work was commercial in nature.
(2) Nature of the copyrighted work: The Court found that The Catcher in the Rye is the type of work that “falls within the core of copyright law’s protective purpose.”
(3) Amount and substantiality: The Court found that the Defendants had taken “well more from Catcher, in both substance and style, than is necessary for the alleged transformative purpose.”
(4) Effect of the use upon the potential market value of the Copyrighted Work: The Court found that it was unlikely that the Defendant’s work would harm the market for Catcher in the Rye, but that it could harm the potential market for a Catcher sequel or other derivative work.
Comments
I find myself disappointed with the hard-line distinction the Court drew between criticizing an author, and criticizing an author’s works. First and foremost this is a false division. Yes, a work must comment on a preexisting work to be considered a parody. But surely a work that comments on a preexising work’s author is also commenting by proxy on the preexisting work itself.
Indeed, from a policy perspective, I think the rationale for finding a work noninfringing is often stronger if it comments on the author of a preexisting work, rather than if it only comments on the works produced by the author: think unscrupulous business, labor, or environmental practices. If courts were to adopt the hard-line distinction between an author and an author’s works, a parody that uses a preexisting work to lampoon the author’s questionable business practices would be infringing.
The theoretical and policy rationales aside, the distinction between commenting on an author and an author’s works strikes me as inconsistent with the underpinnings of Souter’s opinion in Campbell. The majority opinion stands for many, many things, but perhaps most important is the idea that fair use is a common law analysis not to be dictated by hard and fast rules. The majority opinion goes as far as to state that while parody and satire should be treated differently, satire can also be a non-infringing fair use under certain circumstances.
The distinction between an author and an author’s works strikes me as the type of rule that Justice Souter tried hard to eliminate; the type of rule that is formulated in circuits that see many copyright cases because it’s convenient, and then is later misapplied in circuits that don’t see many copyright cases.
Ninth Circuit overturns 68 year old precedent defining prevailing party under the Copyright Act
Filed under Attorneys' Fees
Cadkin v. Loose, 2009 WL 1813263 (9th Cir. 2009).
Plaintiff brought a complaint against a Defendant for, inter alia, copyright infringement. After extensive settlement discussions, an amended complaint, and a denied motion to remand, the Defendant moved to dismiss the complaint without leave to amend. The Plaintiff opposed the motion and lodged notice of voluntary dismissal of its claim under FRCP 41(a)(2). The Central District of California granted voluntary dismissal.
17 U.S.C. 505 of the Copyright Act states that a court may award reasonable attorneys’ fees to the “prevailing party.” The district court found that the Defendant was a prevailing party even though the complaint was dismissed without prejudice and the Plaintiff was free to refile. The Court relied on the Ninth Circuit’s World War II era precedence, Corcoran v. Columbia Broadcasting System, Inc., 121 F.2d 575, 576 (9th Cir.1941).
On appeal, the Ninth Circuit found (Fletcher, Gould, Fisher writing) that the sixty-eight year old case was no longer good law. The Circuit found that for a party to be prevailing, there must be a “material alteration of the legal relationship of the parties.”:
The Supreme Court, in the context of the Fair Housing Amendments Act (FHAA), has since held prevailing party status turns on whether there has been a “material alteration of the legal relationship of the parties,” Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598, 604, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001) (internal quotation marks omitted), and we have held dismissal without prejudice does not alter the legal relationship of parties for the purposes of entitlement to attorney’s fees under a comparable fee shifting statute, see Oscar v. Alaska Dep’t of Educ. & Early Dev., 541 F.3d 978, 981 (9th Cir.2008).
We conclude Corcoran is clearly irreconcilable with Buckhannon and no longer good law. We therefore overrule Corcoran and hold Buckhannon’s material alteration test applies to § 505 of the Copyright Act. See Miller v. Gammie, 335 F.3d 889, 893 (9th Cir.2003) (en banc) (holding thee-judge panel can reject prior panel opinion that is “clearly irreconcilable” with intervening Supreme Court authority). Because the plaintiffs in this lawsuit remained free to refile their copyright claims against the defendants in federal court following their voluntary dismissal of the complaint, we hold the defendants are not prevailing parties and thus not entitled to the attorney’s fees the district court awarded them.
Recent scholarship from the 
