Category Archives: Settlement

Religious translations are works of “imagination and creativity” for purposes of a fair use evaluation

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Shourin Sen - 1 March 2010 – 4:03 pm
Filed under Assignment, Fair Use, Ownership, Settlement, Transfers

Society of the Holy Transfiguration Monastery, Inc. v. Archbishop Gregory, 2010 WL 548114 (D. Mass. 2010)

A Greek Orthodox Monastery brought a copyright suit alleging that an archbishop had infringed a series of its translations of religious texts and that the Archbishop had breached a Settlement Agreement reached in a prior lawsuit involving one of the disputed works.

Ownership

The Archbishop argued that the copyright to one of the works should as a matter of church law be transferred to the Rusian Orthodox Church Outside Russia. The argument was derived from an ongoing dispute that arose when the Greek Orthodox Monastery elected to leave the ROCOR. In 1994, the Massachusetts Supreme Judicial Court found that the Greek Orthodox Monastary was congregational in terms of property ownership and was the sole owner of all of its assets, not the ROCOR. See, e.g., Primate and Bishops’ Synod of the Russian Orthodox Church Outside Russia v. Russian Orthodox Church of the Holy Resurrection, Inc., 418 Mass. 1001, 636 N.E.2d 211 (1994). The Court found that it didn’t need to re-open the dispute because there was no written transfer:

The court need not, however, accept the Archbishop’s invitation to delve into the intricacies of the doctrine of neutral principles as it applies to ecclesiastical disputes. The Copyright Act provides a simpler statutory answer. After 1978, a transfer of copyright, other than by operation of law, “is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.” 17 U.S.C. § 204(a).

As a side note, you can’t say for certain from the factual record, but this case may raise similar issues to those discussed in Schrock v. Learning Curve International, Inc., No. 08-1296 (7th Cir. 2009).  The exclusive rights granted to a work employing preexisting material covered by copyright, such as many translations,  do not extend to any part of the work in which the material was used without permission. 17 U.S.C. 103(a).

If the greek text of the disputed work contains copyrightable subject matter added by the ROCOR, such as annotations or editing choices made recent enough so that they are not in the public domain, the Monastary may, or may not, possess exclusive rights in its translation of the text. The outcome would depend on whether the Court adopted the Seventh Circuit’s finding from Schrock that when a rightsholder grants permission to a second author to make a derivative work, barring an agreement between the parties otherwise, the second author retains a copyright in the derivative work, even if the rightsholder later attempts to revoke permission.

Fair Use

The Archbishop’s copying of one of the works at issue omitted footnotes and three words, added some question marks, changed the spelling of six words, and added some headlines.  The Court found that the work was substantially similar to the Monastery’s.

The Court then looked to whether the copying was a non-infringing fair use. The Court cited Campbell v. Acuff Rose for the proposition that not only is fair use an affirmative defense, but that a defendant has a “burden of proof” to show that the copying was non-infringing. The Court found that the use of the work was infringing.

Purpose and character

The Archbishop argued that his use was non-commercial (purely for devotional purposes), which was not disputed, and that his use was transformative because he placed a portion on the internet. The Court rejected the argument finding that a “simple repackaging” of a work in a new media context is “not transformative when the result is simply a mirror image reflected on a new mirror,” and found that the factor weighed in favor of the Monastery.

Nature of the copyrighted work

The Archbishop argued that the work at issue was factual as part of his religion, and as such, the factor weighed in favor of a finding of fair use. The Court found that the work was more closely akin to a creative work:

As a theological precept, this may ring true to a believer, but from an objective legal perspective, a religious contemplation in the form of a Homily (an admonitory sermon or discourse) falls more appropriately within the category of a work of imagination and creativity. While a translation is by definition derivative, some translations-the King James Version of the Bible comes to mind-are nonetheless thought to be “original in their own right.” This factor, on the whole, weighs in favor of the Monastery.

The amount and substantiality

The Court found that the Archbishop  incorporated the entirety of one of the works on his website for “no apparent purpose other than avoiding the trouble and expense of creating a version of his own.”

Market harm

The Monastery did not allege any specific lost sales or profits as a result of the infringement. The Monastary instead noted that it has had to expend time and resources to enforce its rights in the work. The Court found that, “given Campbell’s emphasis on the deterrence of injurious conduct by others as a consideration separate and apart from a showing of actual market harm, this factor too weighs in favor of the Monastery.”

Daily Copyright Roundup

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Shourin Sen - 24 February 2010 – 9:00 am
Filed under Daily Copyright Roundup, Fair Use, IP Czar, Pro-IP Act, Settlement

I haven’t written a daily roundup in a while. There are a number of recent stories, besides the ACTA leak, that deserve a mention.

The Tennessean is reporting that a suit brought by a music publishing company against A&E over its use of twelve seconds of the song “Rocky Top” has settled. We discussed this case in mid-November when the Middle District of Tennessee found that the use by the network was not fair use, at least without further development of the factual record. No details of the settlement were released.

Victoria Espinel, the U.S. Intellectual Property Enforcement Coordinator or I.P. Czar, announced on the White House blog that she formally requested written submissions from the public on the Joint Strategic Plan for intellectual property enforcement:

To further these goals, we are working to find ways of measuring these threats and their impact on us.  How many jobs depend on the existence of intellectual property?  What are the greatest risks to health and safety?  We need better data on these questions and it is part of my job to figure out what the answers are.  We cannot do that without your help.  So, my office is asking the public to give us information about the costs and the risks – and then give us suggestions for what we could be doing better as a government.   As a first step, we are issuing a notice to the public asking for your input.  Here’s a link to this request (pdf).  You can send your comments to intellectualproperty@omb.eop.gov.  We look forward to hearing from you.

The formal request for written submissions is published in the Federal Register. (H/t Ben Sheffner.)

Eleanor M. Lackman, a Senior Associate in the IP, Media & Technology group at Lovells NY, wrote an article in the New York State Bar Association publication Bright Ideas on the standard for obtaining a preliminary injunction in copyright cases. The article, titled “Factoring in the Public Interest: The Impact of eBay on Injunctive Relief in Copyright Cases,” discusses Salinger v. Colting and Winter v. Natural Resources Defense Council, and contains Ms. Lackman’s predictions about the future of the preliminary injunction standard:

Even in advance of that ruling, however, the debate in Salinger and other cases has awakened courts to the fact that injunctive relief in copyright cases may no longer be so easy to obtain—at least not without an evidentiary proffer on each of the four eBay factors, which were rarely addressed in copyright cases prior to eBay. eBay also may have an impact on the negotiation of licensing fees and money-based settlements.

In light of all the ways eBay might affect copyright law, this article addresses the following four questions: (1) Does the four-factor test enunciated in eBay apply to copyright cases? (2) Does the four-factor test apply to both preliminary and permanent injunctions? (3) How will the four factors be addressed by the courts? and (4) What can a potential copyright licensor, licensee, plaintiff, or defendant expect in the post-eBay world?

Supreme Court grants cert in Reed Elsevier, et al., v. Muchnick, et al.

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Shourin Sen - 3 March 2009 – 8:45 am
Filed under Jurisdiction, Settlement

The Supreme Court granted cert in Reed Elsevier v. Muchnick  yesterday.  Here’s a quick rundown on the case.

New York Times Co. v. Tasini:

Our story begins about a decade ago.  In New York Times Co. v. Tasini, six freelance authors brought a copyright infringement suit against a group of publishers including the New York Times, Newsday, Time and LexisNexis. The freelancers were hired as independent contractors to write articles for the news outlets.  The publishers licensed the articles to electronic databases such as LexisNexis.

17 U.S.C. 201(c) states the following:

“In the absence of an express transfer of the copyright or of any rights under it, the owner of copyright in the collective work is presumed to have acquired only the privilege of reproducing and distributing the contribution as part of that particular collective work, any revision of that collective work, and any later collective work in the same series.”

The freelancers claimed that, under 201(c), they only licensed their works for use as a contribution in newspapers and not in electronic databases.  In 2001, the Supreme Court agreed, finding that if  the publishers wanted to include the articles in electronic databases they needed to have had obtained specific authorization to do so.

Negotiations and settlement:

Following the ruling in Tasini, the National Writers Union brought a consolidated copyright class action against a group of forty publishers.  The sides engaged in four years of negotiations before reaching an industry-wide settlement.  The settlement divided the authors into three groups:

  1. Category A: copyrights that were registered prior to any infringement;
  2. Category B: copyrights that were registered after the infringing reproduction but before December 31, 2002;
  3. Category C: copyrights registered after December 31, 2002 or not registered at all.

The settlement agreement then allocated damages per group:

  1. Category A claimants received a flat fee;
  2. Category B claimants received the greater of either a flat fee or a percentage of the original price of the work;
  3. Category C claimants also received the greater of either a flat fee or a percentage of the original price of the work.  However, if the cost of all claims (plus the cost of notice, administration, and attorney’s fees) exceeded $18.5 million, then the amount paid to Category C claimants was reduced – potentially to zero.

The District Court approved the settlement under Rule 23.

The Second Circuit:

Objectors from Class C appealed the approval of the settlement on the grounds that it was inadequate and unfair to Category C claimants and that the disparate treatment of Category C claimants illustrated that named plaintiffs, who each possess at least some registered copyrights, did not adequately represent those absent class members who possess only unregistered copyrights.   The Second Circuit raised the issue of jurisdiction sua sponte: whether the S.D.N.Y. lacked subject matter jurisdiction to approve any settlement that includes a release of copyright claims for unregistered works.

17 U.S.C. 411(a) states in part:

[N]o action for infringement of the copyright in any work shall be instituted until registration of the copyright claim has been made in accordance with this title [17 U.S.C. Sects. 101 et seq.] [emphasis added]

The Defendants of the settlement argued that for federal question jurisdiction to arise under the Copyright Act, only one of the classes needed to have members who had registered.  Judges Ralph K. Winter, Jr. &  Chester J. Straub rejected this argument and found that each claim in a certified class must be registered for federal question jurisdiction to arise under 411(a).

Judges Winter & Straub  further held that the text of 411(a) precluded  the use of supplemental jurisdiction to grant jurisdiction to Class C.  Thus, the Second Circuit vacated the order approving the settlement.

Judge John M. Walker, Jr. dissented on the grounds that since “Congress passed § 411(a) to facilitate the enforcement of copyrights, . . . compliance with § 411(a) is a mandatory prerequisite to the accrual of a cause of action for damages, but not a prerequisite to the possession of constitutional standing.”  Judge Walker found that the suit fell “within the ambit of . . .  Denney v. Deutsche Bank A.G., 443 F.3d 253 (2d Cir. 2006), that not all members of a settlement-only class must possess a valid cause of action under the applicable law at the time of settlement.”

The cert petition:

The Defendants of the settlement argued for certiorari on three grounds:

  • Broad releases are often necessary to achieve complex settlements; the power to settle cases necessarily entails the power to approve releases of claims beyond the approving court’s jurisdiction;
  • There is tension between the Second Circuit’s decision and the Supreme Court’s expectation in Tasini that “[t]he parties (Authors and Publishers) may enter into an agreement allowing continued electronic reproduction of the Authors” works”;
  • The settlement provides a strong public benefit.

Documents: