Fixation and Violation of the Derivative Right

Back in 2004, when the motion picture companies were waging an unsuccessful fight against what became the Family Movie Act -- an initiative to empower parents to filter out smut and other objectionable elements from smutty films they were voluntarily viewing with their children at home -- the issue was raised whether the derivative right was violated by altering the manner in which the motion picture was viewed. I found the argument a bit strange: the actual complaint was over an altered performance and since the performance in question was private, there could be no violation of Section 106(4). As to the separate derivative right, the complaint was really over the filtering software, which itself was not a derivative work of anything. In short, the argument was, for me at least, too clever by a half, which is to say not clever at all.

But it did get discussed, and in testimony by the Register of Copyrights before the House of Representatives' IP subcommittee on June 17, 2004. Here is a link to that testimony. One part of that testimony states: "The question is, can you have a derivative work when no copy (or "fixation") of the derivative work exists?" The Register answers that question negatively, but the statute is quite clear the answer is positive. Section 106(1) gives copyright owners the right to reproduce the work in copies. Section 106(2), however, gives the copyright owner the right to prepare derivative works based on the original. The lack of the limitation to "copy" in Section 106(2) supplies the intent the Register sought.

Nor does it rebut this position to point out that Section 106(2) refers to "works" and that to be protected "works" must be fixed. Section 106(2) concerns infringement, not protectibility, and assumes the existence of a protected (that is, a fixed work), that may be infringed by an unauthorized unfixed derivative work.

If there was any doubt from the plain language of the statute, it is dispelled by this discussion from the 1976 Act committee reports:

The exclusive right to prepare derivative works, specified separately
in clause (2) of section 106, overlaps the exclusive right of reproduction
in [section 106(1)] to some extent. It is broader than that right, hwoever,
in the sense that reproduction requires fixation in copies or phonorecords,
whereas the preparation of a derivative work, such as a ballet, pantomime,
or improvised performance, may be an infringement even though nothing is
ever fixed in tangible form.
H.R. Rep. No. 1476, 94th Cong., 2d Sess. 62 (1976); S. Rep. No. 473, 94th Cong., 1st Sess. 58 (1975).

This view is, moreover, based on an earlier view expressed by Register of Copyrights Abraham Kaminstein in his 1965 Supplementary Report, at p. 17.


There is a good reason there is no requirement that an infringing derivative work be fixed in a copy: as noted in the committee reports, if a musical work has been fixed, Congress wanted to provide a cause of action for someone who improvised an unauthorized version of it. Of course, as with all rights, there must be a substantial taking (so that aside from the fixation issue, the reproduction right and the derivative right are redundant - that is what the reports meant by "overlaps") and defenses such as fair use apply.

No VARA Trophy

The Visual Artists Rights Act is a somewhat embarrassing nod toward droit moral: a minimal grant of rights of attribution and integrity long recognized in civil law copyright systems. Passed in 1990, but effective 1991, Section 106A is severely limited in scope, marred by some of the ugliest drafting ever (thanks to book publishers who had no real dog in the fight anyway), and astonishingly, ridden with formalities, i.e., a marking requirement; it such a distinctly American product that it gives the French reason to say "We told you so."

Still, it is better than nothing since nothing would have been passed had it not been. There are, though, not surprisingly few VARA cases. One just decided by the Third Circuit doesn't exactly take the prize, but it does involve a trophy, specifically a design for NASCAR to replace the Winston Cup. The new trophy, the subject of the dispute, was to be known by the winsome name "NASCAR NEXTEL Cup," National Association for Stock Car Racing, Inc. v. Scharle, 2006 WL 1697101 (3d Cir. June 21, 2006). Here is the court's entire discussion of VARA:

VARA protects the rights of attribution and integrity of the author of a “work of visual art.” 17 U.S.C. § 106A. A “work of visual art” is defined as:

1) a painting, drawing, print, or sculpture, existing in a single copy, in a limited edition of 200 copies or fewer that are signed and consecutively numbered by the author, or, in the case of a sculpture, in multiple case, carved, or fabricated sculptures of 200 or fewer that are consecutively numbered by the author and bear the signature or other identifying mark of the author; or(2) a still photographic image produced for exhibition purposes only, existing in a single copy that is signed by the author, or in a limited edition of 200 copies or fewer that are signed and consecutively numbered by the author.17 U.S.C. § 101.

Among other things, a work of visual art does not include any: “technical drawing, diagram, model, ··· merchandising item[,] or advertising [or] promotional ··· material.”The district court found that Scharle's drawings for the trophy fell outside the purview of VARA and granted summary judgment for the Mint on this claim. The court determined that Scharle's works were drafts which did “not exist in a single copy or a limited quantity of signed and numbered copies, but instead as multiple attempts to arrive at the optimal design for the trophy.” We agree with the district court's conclusion. We note, however, that there is at least one other ground upon which the district court could have relied upon in concluding that VARA did not apply to Scharle's work. We believe that the court could have concluded as a matter of law that Scharle created technical drawings, diagrams, or models for the trophy, and are therefore excluded from the definition of “works of visual art.” 17 U.S.C. § 101.Accordingly, the district court properly determined that the trophy images were not “works of visual art” under VARA.

The alternate ground is the only sound one: there is no marking requirement for an in-process draft: drafts don't constitute editions.

Presidential Signing Statements

At 10 EST, the Senate Judiciary Committee will hold a hearing on "The Use of Presidential Signing Statements." Witnesses are Michelle Boardman, Office of Legal Counsel, Charles Ogletree, Harvard Law School, Christopher Yoo, Vanderbilt Law School, Bruce Fein Esq., and Nicholas Rosenkranz, Georgetown Law Center. An article in yesterday's New York Times discussed Congress's anger and frustration over the Bush Administration's serial use of Presidential signing statements to stake out a position that contravenes the plain words of the statute and contravenes deals painstakingly worked out between Congress and the Executive Branch. Here is a link to a Findlaw article by John Dean that contains other references. Those interested in Justice Alito's views should read this January 2006 article from the Washington Post.

In light of the loud position of some that meaning is to be found only in the text of a statute, it will be interesting to hear their views on the weight if any to be given to the President's efforts to create a form of legislative history for the work product of another branch of government.

This is not to say that the Bush Administration is the first to use signing statements: my first real experience with them was, I believe, in 1998 when, in response to grumblings that Congress had impermissibly delegated to the Copyright Office the function of determining exemptions from the DMCA's anticircumvention provisions, President Clinton stunned the copyright world and many others by claiming in a signing statement that the Copyright Office was in the Executive Branch. It isn't and saying it is doesn't make it so. (Here is a link to a 1993 memorandum prepared by Bernie Nussbaum for President Clinton on the legal significance of signing statements).

Creative Commons Brazil

These days, when Brazil is in the news, it is usually about World Cup soccer, and for good reason: Ronald, Ronaldinho, Kaka and others are brilliant players, and fun to watch. But this last weekend, the far less glamorous issue of copyright licensing was being discussed in Brazil itself, at a three day conference in Rio . The New York Times had a story about the conference in today's paper. For those who couldn't make it or who want to relive it, here is a link to a highlights video, as well as a link to Creative Commons Worldwide. The conference had the backing of Gilberto Gil, a prominent singer-songwriter who also happens to be Brazil's culture minister, a choice almost as inspired as the Czech Republic's choice of Frank Zappa.

There is a great deal to be positive about in the conference and the Creative Commons movement, which the Times article reviews. Of course, one needs to have rights in order to license them, and the article discusses Mr. Gil's efforts to get his back. It is also important to devise ways so that creators don't give away their rights in the first place. That will require market conditions so that individuals will themselves distribute their works in way that will result in sufficient remuneration without the need to involve a middleman. Creative Commons can't solve that problem, but by having a system in place to license rights, it has taken a big step in creating the overall atmosphere in which individual-based distribution may be feasible.

Is the Supreme Court Broken?

Yesterday, the Supreme Court dismissed as improvidently granted ("DIG'd"), the writ of certiorari in Laboratory Corp. of America Holdings v. Metabolite, over a 15 page dissent by Justices Breyer, Stevens and Souter. Chief Justice Roberts did not participate. For those interested in the procedure and its use, here is a link to a 59 page study by Professors Michael Solimine and Rafael Gely of the University of Cincinnati College of Law entitled "The Supreme Court and the DIG: An Empirical and Institutional Analysis," also published in 2005 Wisc. L. Rev. 1421.

The Metabolite case had been closely watched and was to determine whether the patent claimed "a monopoly over a basic scientific relationship." The Solictor General had advised the Court not to grant the writ in the first place, but the Court rejected the advice. The case was then fully briefed, argued, and ditched without explanation. As Justice Breyer pointed out, in addition to the parties' briefs and a comprehensive record, the Government submitted briefs as did 20 amici. The issues were important (beyond whether high homocysteine levels suggest vitamin B-12 deficiencies), and hearken back to the scope of Diamond's loose language about being able to patent "everything under the sun." Having rejected the SG's advice not to take the case, to ditch it after making everyone go through with it seems particularly unseemly and very unfair to the parties.

Two things disturb me about the Court's action in this and other cases; first, there is what I perceive to a pattern of taking important intellectual property issues and then dodging them. This occurred in software (Lotus v. Borland, affirmed 4 to 4 a week after oral argument); Grokster, where I view the 9-0 majority as a phony facade and a failure to reach the issues actually presented; eBay, handed down this year with another phony 9-0 opinion and two concurrences that cut the legs out from under the "Court's" opinion; and now Metabolite, DIG'd.

Things could have been worse, though, the Court might have actually decided Metabolite and the other cases, and that is indeed a sad comment on the state of the Court: when you don't know what is worse, when they decide a case or when they don't. There were those who hoped that Chief Justice Roberts might be able to produce a less fractured way of working. One could say he hasn't had enough time (and he didn't participate in Metabolite), but he himself was responsible for cutting the legs out from under the Court's decision in Ebay with his concurring opinion, so I am not holding my breath.

Prevailing Parties and Attorney's Fees

In an opinion handed down a week ago in the SDNY by Judge Denise Cote, Ninox Television Ltd. v. Fox Entertainment Group, Inc., 2006 WL 1643300, the tricky issue of award of attorney's fees where a complaint is voluntarily dismissed with prejudice was addressed.

Section 505 of the Copyright Act is straightforward, at least linguistically: the court may, in its discretion, award a reasonable attorney's fee to the prevailing party as part of costs. The Act does not define prevailing party, and hence general law principles apply. The most important articulation of those principles is Buckhannon Board & Care Home, Inc. v. West Virginia Department of Health & Human Resources, 532 U.S. 598 (2001). Buckhannon rejected the then-dominant "catalyst" theory in favor of a requirement that there be a "judicially sanctioned change in the legal relationship of the parties."

One problem that has arisen post-Buckhannon is what "judicially sanctioned" means. Court ordered dismissals on the merits clearly fall within such "judicial imprimaturs," Gardendance, Inc. v. Woodstock Copperworks, Ltd., 2006 WL 305220 (M.D.N.C. Feb. 8, 2006); NXIVM Corp. v. Ross Institute, 2005 WL 1843275 (N.D.N.Y. Aug. 2, 2005); Bridgeport Music, Inc. v. London Music, U.K., 345 F. Supp.2d 836 (M.D. Tenn. 2004)(extensive discussion). Voluntary dismissals without prejudice don't, TRF Music Inc. v. All Ett Music Group, 2006 WL 1376931 (S.D.N.Y. May 18, 2006)(Castel, J.); Philadelphia Stock Exchange v. International Securities Exchange, Inc., 2005 WL 2923519 (S.D.N.Y. Nov. 2, 2005)(Buchwald, J.).

But what about stipulated dismissals with prejudice? This is what the Ninox opinion addresses; its conclusion, moreover, departs from that of another opinion in the same district, Chambers v. Time Warner, Inc., 279 F. Supp.2d 362 (S.D.N.Y. 2003). Ninox involved a claim of infringement of a New Zealand reality show Dream Home by Fox's The Complex: Malibu. The claim was in the format. Dismissal came about due to the litigation in Australia involving an indirect licensor to Fox. Judge Cote found the stipulated dismissal with prejudice resulted in a sufficient judicial imprimatur to deem Fox the prevailing party. Indeed, where it otherwise, a perverse incentive would be created, whereby defendants would block such dismissals and require the court to rule on the merits in order to stand a chance of obtaining fees. Chambers, supra, however held to the contrary, and was not cited in Ninox.

Defendant did not obtain its fees in Ninox nevertheless, despite plaintiff "all but" conceding its claim was frivolous and the court's finding that Fox engaged in a successful and efficient litigation strategy. The court also stated that but for the dismissal the case would have required it to "appl[y] copyright principles to a relatively new field of intellectual property, format licensing," but this is perplexing: plaintiff conceded its claim was frivolous, and due to the skill of Fox's counsel the court did not have to engage in any merits analysis. Denying fees under such facts creates its own perverse disincentive: the better job you do and the less a burden you place on the court the less likely you are to get attorney's fees.

Expert Witness Leads to New Trial

In a 1901 law review article, "Historical and Practical Considerations Regarding Expert Testimony," 15 Harv. L. Rev. 40 (1901), written before he took the bench in 1909, Learned Hand wrote: "No one will deny that the law should in some way effectively use expert knowledge wherever it will aid in settling disputes. The question is as to how it can do so." One area where Second Circuit judge Hand later used experts was at the damages phase of the trial, as in Sheldon v. MGM, 106 F.2d 45 (2d Cir. 1939), aff'd 309 U.S. 390 (1940). Hand, however, took a very strong negative view toward experts at the substantial similarity stage, writing in Nichols v. Universal Pictures Corp., 45 F.2d 119, 123 (2d Cir. 1930):

"We cannot approve the length of the record, which was due chiefly to the use of expert witnesses. Argument is argument whether in the box or at the bar, and its proper place is the last. The testimony of an expert upon such issues, especially his cross-examination, greatly extends that trial and contributes nothing which cannot be better heard after the evidence is all submitted. It ought not to be allowed at all; and while its admission is not a ground for reversal, it cumbers the case and tends to confusion for the more the court is led into the intricacies of dramatic craftsmanship, the less likely it is to stand upon the firmer, if more naïve, ground of its considered impressions upon its own perusal. We hope that in this class of cases such evidence may in the future be entirely excluded, and the case confined to the actual issues; that is, whether the copyrighted work was original, and whether the defendant copied it, so far as the supposed infringement is identical."

Unfortunately, in one of the Second Circuit's worst copyright opinions, Arnstein v. Porter, 154 F.2d 464 (2d Cir. 1946)( by Jerome Frank, with Hand joining and Charles Clark dissenting), experts got their snouts under the tent through the malicious striking similarity doctrine. Things have been downhill from there. While most courts state that experts can testify only at the copying stage and not at the substantial similarity stage (except in software cases), routinely experts breach the barrier. A friend who is a circuit judge after a long career as a district judge refers (privately) to such experts as paid liars, but beyond concerns with untruthfulness, there is the institutional problem of confusing juries with a battle of the experts. In the same 1901 article Hand spoke to this issue:

"When an expert is on the stand what are the methods resorted to? Quite the same as when it is a witness. He is first examined in chief by the side which calls him. Assuming he has no direct evidence of facts to give, he must be plied with hypothetical questions, at as great length and in as great detail as seems necessary.
…He is then handed over to the opposite side for cross-examination. There are two and only two possible efforts which the cross-examiner will make. First, he may seek to bring out other general propositions favorable to his contention; second, he may seek to shake the validity of those already testified to. Similarly when it comes to the turn of the opposite side to submit evidence it has the same two possible objects, to introduce evidence showing the invalidity of what the opposite experts have said, or to bring out other general truths favorable to them.
The trouble with all this is that it is setting the jury to decide, where doctor disagree. The whole object of the expert is to tell the jury, not facts, as we have seen, but general truths derived from his specialized experienced. But how can the jury judge between two statements each founded upon an experience confessedly foreign in kind to their own? It is just because they are incompetent for such a task that the expert is necessary at all.

… What hope have the jury, or some other layman, of a rational decision between two such conflicting statements each based on such experience?"

The answer is that juries have had no hope and too many trials have been a farce; when coupled with meritless striking similarity claims, we have suffered from 60 years of the mess wrought by Arnstein v. Porter, a result Judge Clark predicted in dissent. There is a very happy development, however: yesterday, the Eighth Circuit, in Rottlund Co. v. Pinnacle Corp., 2006 WL 1676883, ordered a new trial after ruling that the district judge abused his discretion in letting an expert testify about substantial similarity. Now that will get trial courts' attention and it is precisely the sort of remedy that is necessary to start setting things aright.

Aside from the bold step itself, two other things are noteworthy about the opinion and cause joy in my heart. First, the court of appeals (per Judge Wollman), pierced the particular language used by the expert which was couched (or coached) as testimony about copying and not substantial similarity. This is very important because it closes a semantic loophole created by Arnstein. Second, even as to copying, the Eighth Circuit precluded testimony where the expert had no facts upon which to base his opinion.

I never thought I would see such an opinion. Praise the Lord.

Does It Matter if Copyright is Property?

Recent years have seen an explosion of academic interest in questions of property. Law professors plumb ancient, Elizabethan (if I have to read any more about John Locke and copyright I will puke) and modern sources in an effort to develop a unique (read publishable in a top ten law review) theory of the subject. These are big articles. See e.g., "A Theory of Property," 90 Cornell L. Rev. 531 (2005)(74 pages); "What is Property? Putting the Pieces Back Together," 45 Ariz. L. Rev. 371 (2003)(66 pages). Intellectual property is not immune from such efforts, see the 125 page "Cabining Intellectual Property Through a Property Paradigm," 54 Duke L.J. 1 (2004). Academically oriented judges have gotten in on the debate too, see Frank Easterbrook, "Intellectual Property is Still Property," 13 Harv. J. L. Pub. Pol'y 108 (1990). Cf. Stephen Carter, "Does it Matter Whether Intellectual Property is Property?," 68 Chi.-Kent L. Rev. 715 (1993). Even those who oppose the dramatic expansion in rights since 1998 have tended to talk the IP property-talk, albeit through an appeal to a different result based on democratic ideals.

The debate about the provenance of copyright as property is not new, nor has the semantic sleight-of-hand the effort attempts gone unnoticed. At the end of the 19th century, Augustine Birrell wrote:

"The origin of property, of exclusive ownership, is one of the subjects about which our predecessors in title loved to discourse at large after a fashion more ingenious than historical. ... Occupancy and Labour are the mythical parents of Property, but we shall be less wrong in assuming the pedigree was invented to account for the fact of possession than in attributing the fact of possession to the virtues of the pedigree.”
Augustine Birrell, "Seven Lectures on the Law and History of Copyright 11 (1899).

What those who seek to have copyright classified as property is clear enough though: Blackstonian sole dominion, justified by the very classification of property. Again Birrell (id. at 103-14):

"[T]he Western World has throughout its long history shown an ever increasing disposition to recognize the right of individuals to the exclusive possession of certain things, and these rights it has clustered together, recognized, venerated, worshipped, under the word property.

To be allowed to enter this sacrosanct circle is a great thing none but the oldest families need apply … Once inside this circle your rights were supposed in some romantic way to be outside the chill region of positive law – they were based upon natural rights, existing previously to the social contract, and without which Society was deemed impossible.

Nor were these romantic conceptions more jeux d’esprit. Consequences flowed from them. If your right to turn your neighbor off your premises to keep your things to yourself – was property, and therefore ex hypothesi founded on natural justice, he who sought to interfere with your complete dominion was a thief or trespasser, but if your rights were based upon some special concession made to you upon your own merits, you find yourself dubbed a monopolist … Monopoly is always an odious word. Property is still sacred one."

But what if copyright is just a tort, as indeed courts refer to it as. Might that not lead to consideration of things in a different light, one that involves more of the balancing of interests one typically sees, say in, negligence actions, a Coase Theorem of copyright? There is an article about this too, Robert Merges, "Of Property Rules, Coase, and Intellectual Property," 94 Colum. L. Rev. 2655 (1994), but academia aside, in the real world, one wonders whether the recent willingness of courts to decline issuing injunctions signals a shift toward a less property-oriented view.

The Gripes of Wrath

You're a federal judge in the Southern District of New York. Through luck of the wheel,you are assigned an interesting dispute over termination rights in the works of a Pulitzer and Nobel Prize winning American author. Yet, you can't write to save your life. Here is Exhibit A, from the very beginning of the opinion in Steinbeck v. McIntosh & Otis, Inc., 2006 WL 1586547 (S.D.N.Y. June 8, 2006):

"Given the said length of copyright protection, early in which young creators often less than advantageously contract for long terms with publishers, etc., and it also being the way of the world that a number of such young composers, artists and authors, from time to time, such as John Steinbeck writing his first book in 1929, cannot predict the high stature they would attain, and the popular prominence of their works in musical and literary consciousness-not to mention the eventual high financial rewards to them and their families their work can command, our copyright laws have come to recognize this, and accordingly, in the statute, provide opportunities for such a creator and/or his or her family to terminate-and recapture-rights previously granted others, allowing creators or their heirs appropriate reward for the artistic gifts to our culture."

That, dear readers, is one sentence. The issues raised in the case are a precis of the confusing intersection of provisions governing "old Act" works, caught up in family feuds emanating from multiple marriages: wives against grandchildren, and grandchildren against grandchildren. Frankly, it is hard to give a damn as a character in another writer's novel put it, but the opinion is one those who labor in this dysfunctional garden should read.

Right of Indemnification for Infringement

Yesterday's post discussed whether there is a right of contribution among defendants for damages paid for copyright infringement. Today's post discusses whether there is a right of indemnification under such circumstances. Indemnification does not seek to apportion the amount of damages paid among the defendants, but rather seeks to have one defendant make the other whole for all damages paid: if A sues B and B pays 100% of the damages, B may, under indemnification, seek to have C pay back B for all the damages B paid to A. Judge Posner has written:

"The economic explanation for the complete shifting of liability from one joint
tortfeasor to another that is brought about by indemnity is
straightforward. In an alternative-care case we do not want both
tortfeasors to take precautions; we want the lower-cost accident
avoider to do so. The liability of the other is a backstop in case
insolvency prevents the threat of tort liability from deterring
the primary accident avoider. Hence the need for a mechanism
that will, where possible, shift the ultimate liability to the most
efficient accident avoider; indemnity does this."

Economic Analysis of Law 190 (6th ed. 2003).

Unlike claims of contribution, courts have upheld state law claims for indemnification, arising out of state common law or statute. In Foley v. Luster,249 F.3d 1281 (11th Cir. 2001), the Eleventh Circuit upheld against a preemption argument, a state common law claim to indemnification. As with contribution claims in copyright cases, the right of indemnification was asserted as a cross-claim. After the plaintiffs settled , the cross-claim went forward, with a jury finding indemnification was required. A post-trial motion to dismiss on the ground of preemption was filed and denied. The Eleventh Circuit affirmed the denial, holding that the extra element test for preemption did not apply, allegedly, because indemnification “does not concern the rights of a copyright holder. Rather, it concerns the allocation of responsibility between copyright infringers.” But that is true of contribution too, the right to which has been held preempted. The court of appeals’ other rationale that the extra element test applies only to exclusive rights is also erroneous: preemption covers both rights and remedies, and it seems fairly obvious that a right to shift payment of damages is a right involving remedies. Indeed, this is precisely why all courts have held such matters are exclusively federal for violation of federal torts.

This does not mean, however, that the right to indemnification for paying infringement damages is preempted. It is my opinion, such a right is not preempted because the right or remedy is not equivalent to any granted under the Copyright Act and does not arise under the Copyright Act: once payment is made to the copyright owner, the federal interest in extinguished.

Right of Contribution for Infringement

The Copyright Act makes infringers jointly and severally liable for plaintiff’s monetary losses. (Defendant's profits are subject to several liability). The Act does not contain any provisions providing for contribution and not surprisingly, the courts have been uniform in holding that no such rights exist as a matter of federal law. Perhaps surprisingly, federal courts have held state law may not apply either, a conclusion I question.

The early common law precluded contribution among joint tortfeasors, although there is evidence that the rule, initially established in the 1799 English opinion in Merryweather v. Nixan,was intended to apply only in cases of intentional wrongdoing. The common law has, however, been abrogated in most states, either by statute or by decisional law. Federal courts, post-Erie Railway Company v. Tompkins,have been held to have no ability to create a federal common law of contribution for federal statutes, with certain exceptions, such as admiralty law and Section 10b-5 of the Securities Exchange Commission Act of 1934.

This leaves state law. In two opinions, Lehman Bros., Inc. v. Wu, 294 F. Supp.2d 504 (S.D.N.Y. 2003) and Johnston v. Smith, 43 USPQ2d 1538 9N.D. Ga. 1997), federal courts have rejected state claims of contribution for damages paid for copyright infringement, holding such rights may exist only under the Copyright Act; since the Copyright Act does not provide such a right, the claim was rejected. These rejections did not use preemption as the decisional ground, but no other basis seem apparent: if state law did not provide for such relief, the court would have dismissed on that basis. By contrast, in patent cases, where the same no contribution rule obtains, some courts have analyzed the matter under a preemption analysis, albeit with little discussion and out of an odd belief that contribution would conflict with the existence of a federal cause of action for contributory infringement. How state contribution would conflict with federal contributory infringement is not explained and it is difficult to see how it would: contribution only comes into play after plaintiff has been paid off, and one defendant demands the other defendant pay its proportional share of the award. That’s true even when the first defendant, who pays 100% of the damages to plaintiff is a contributory infringer, and the second defendant against whom contribution is sought, is the direct infringer.

Once plaintiff’s damages award for violation of the federal tort is satisfied, the federal interest is extinguished; a state court contribution action does not arise under the Copyright Act and does not conflict with any federal purpose, nor may Congress be deemed to have occupied the field for such concerns. The objective of joint liability is to ensure that plaintiff is able to recover from whomever it can tag; once plaintiff has recovered, the Copyright Act does not care whether the defendants then go into state court and duke it out over contribution.

There are, however, a few countervailing arguments, arguments that seem to have won the day, at least in federal court: first, federal law, which creates the right, has determined that any one infringer is liable regardless of the acts of others, presumably reflecting a federal policy of imposing sole liability at plaintiff’s choice: second, to say that A shall be liable to B is to expressly create a cause of action; thus, to say Defendant A is liable to contribution to Defendant B for copyright infringement is to create a cause of action, something which Congress only is empowered to do for violation of a federal right. Third, and following Judge Posner, Economic Analysis of Law 189-190 (6th ed. 2003),if defendants are aware they will be solely liable to infringement, they may act more carefully than if they believe they will ultimately be liable only for a proportional share. A final reason may also be advanced, also mentioned by Judge Posner, judicial costs: a right of contribution imposes an additional burden on courts to adjudicate the contribution claim. While it is difficult to see why federal courts should care about increased burdens on state courts, especially where state law provides for a right of contribution broad enough to cover copyright infringement, the answer may be that all of the opinions in which the availability of contribution was reached have involved third-party complaints brought in federal court as an adjunct to the infringement claim; one can, therefore, appreciate how federal judges might give short schrift to the right under such circumstances.

Copyright's Wake

Fans of James Joyce who are also foes of copyright term extension will be interested in this article from the Associated Press:

SAN FRANCISCO - A Stanford University professor on Monday sued James Joyce's estate for refusing to give her permission to use copyrighted material about the "Ulysses" author and his daughter on her Web site.

In the lawsuit, Carol Shloss, an acting English professor and Joycean scholar, challenged the estate's assertion that she would be infringing on its ownership of Joyce's image by quoting his published works, manuscripts and private letters on her scholarly site.
Instead, Shloss accused Joyce's grandson, Stephen James Joyce, and estate trustee, Sean Sweeney, of destroying papers, improperly withholding access to copyrighted materials and intimidating academics to protect the Joyce family name.

Stephen James Joyce is not named as a defendant in the suit, but as an agent of his grandfather's estate.

Shloss was traveling Monday and unavailable for comment, according to her lawyer David Olson.

The dispute centers on Shloss' research for "Lucia Joyce: To Dance in the Wake," her 2003 book that posited James Joyce's mentally ill daughter was the muse behind "Finnegans Wake," his last novel. Published in 1939 and filled with Joyce's trademark puns and impenetrable prose, "Finnegans Wake" traces human history through the life of an Irish everyman and his family.

Lucia Joyce, who first was committed to a mental hospital at age 25, died in 1982 at age 75. Shloss maintains in her book that Lucia Joyce's inspiration is woven throughout "Finnegans Wake," but says in her lawsuit that the Joyce family has labored to excise any public or academic mention of the woman.

"People have destroyed documents about Lucia Joyce for over 60 years, apparently due largely to the stigma that previous generations attached to young women who had suffered emotional trauma," Shloss said in the suit, filed in U.S. District Court in San Francisco.
Shloss, who said she spent 15 years working on the book, relied on Lucia Joyce's medical records, European archives that contained records on her life and Joyce's papers in university collections to support her theory, the lawsuit states.

Olson said copies of the suit will be sent to Sean Sweeney's address in New York and to the estate's law firm in Ireland. A phone number for Sweeney was not immediately available and phones rang unanswered late Monday at the Irish firm.

Before the book was published, publisher Farrar, Straus and Giroux removed several supporting citations from Shloss' tome to avoid a lawsuit, according to Olson. Shloss wants to post that information as an electronic appendix to answer several critics who charged that "To Dance in the Wake" was interesting, but thin on documentary evidence, Olson said.
"It's painful once you've written something ... that you think is complete and good, to have it hacked up," Olson said. "There is a desire to bring it forth in the way she originally intended."
Shloss prepared the Web site last year but never made it public because she worried about being sued, Olson said. Among the items excised from the book are quotations from "Finnegans Wake" she thinks support her thesis, as well as letters between James Joyce and his daughter, according to Olson.

Shloss wants the court to declare she's entitled to use information the estate controls under laws that allow authors to quote copyrighted works if they do it in "a scholarly transformative manner."

"We think the estate of James Joyce has been particularly egregious in misusing its copyright," Olson said. "You shouldn't try to use copyright to try to take editorial control of someone's work."



The Joyce estate's actions have been controversial and have highlighted the very heavy downside of the European Union's term extension, which the U.S. regrettably adopted. Here is a FAQ on the estate's practices. D.T. Max has a long article on Stephen Joyce in the June 19th issue of The New Yorker magazine, entitled "The Injustice Collector: Is James Joyce's Grandson Suppresisng Scholarship?" A very helpful, 60 page look at the Joyce estate and copyright term extension by Matthew Rimmer may be found here. Dr. Rimmer also provides details of the estate's sabre-rattling before "Rejoyce Dublin 2004," in which, among other things, the author's grandson Stephen Joyce is reported to have argued that an exhibition staged by the National Library of Ireland would engage in copyright infringement by the mere display of Joyce's manuscripts and draft notebooks. In 1997, I published an article called "The Failure of the American Copyright System: Protecting the Idle Rich," 72 Notre Dame L. Rev. 907. My views on the obscene length of term have only deepened since then. But since we are stuck with the law, and indeed the Administration has been going around the globe obligating the United States to life plus 70 in bilateral agreements, the reality is we are stuck with it. One can only pray that courts, through fair use and misuse defenses will take away some of the bite. The orphan works legislation is of course another route, but the limited scope of the legislation is likely to have only a small impact, despite the best intentions.

Fish is Fish

Having young twins, I read alot of children's books, including the classic "Fish is Fish" by the great Leo Lionni, which is not about Stanley, but about a fish whose tadpole friend becomes a frog, goes on to the shore and comes back with stories about all of wondrous land-based things it has seen. The fish, jealous, flips itself on the ground, grasps for air, is saved by the frog who pushes him back into the water, and comes to realize that life in the water is wondrous too. I doubt my twins get the moral being taught, but they like the story and the pictures.

This week, if the House of Representatives marks up its "Section 115 Reform Act of 2006" (affectionately called SIRA), we may get a lesson about whether copyright rights may be frogs and fish; that is, whether one act may implicate two different rights. Since at the least the the debates in the early 1990s on providing a digital audio transmission right in what became Section 106(6), this issue has been the subject of contention, first by the performing rights societies, who wanted to make sure that rights granted to record companies didn't diminish money paid to them under Section 106(4), and second with the amendment to Section 115 expanding the compulsory license to include digital phonorecord deliveries: could a transmission be both a performance and a distribution, and more to the point, could two payments be required for the same transmission of the same work?

The issue is likely to be raised with interactive streams and the reproductions made to facilitate them. Giving things names usually indicates that those things have certain characteristics, characteristics that make them different from things that have another name and presumably have different characteristics, like reproduction and distribution. It is not that Congress can't give the same thing two different names, or that Congress can't define things in a way such that double payment might be required, but rather whether it has and if not whether it should.

Historically, the bundle of rights granted in the Act have been an effort to describe different acts, and in the U.S., different groups grew up to license those different acts. There is no doubt that digital technology has put pressure on this ancient system, and there was an effort awhile back by Chairman Smith and the Copyright Office to update matters, but that effort seems to have been abandoned. With that effort abandoned, the old divisions still exist and are likely to give rise to continuing problems in getting fish to be happy with being fish.

DRMs and Fair Dealing

Yesterday's posting was on the French (we hate your fiendish leetle snippets, Google!) so it is only fair and balanced (tm) that today's be about their friends across the channel, the les rosbifs. In a speech this week to the All-Party Parliamentary Internet Group, the British Library's Chief Executive Lynne Bradley, complained that Digital Rights Management (DRM) restrictions are interferring with libraries' ability to avail themselves of the fair dealing provisions of the UK Copyright Act. Those provisions, it may be noted, are different from our fair use doctrine. The great 18th century English common law judges, in the early days of swaggering law-making, developed fair use, which we them adopted and ran with, beginning with Justice Story's landmark (he was in Massachusetts where they have landmarks; we in New York City have none) opinion in Folsom v. Marsh, 9 F. Cas. 342 (C.C.D. Mass. 1841). Later English judges thought Story did such a smashing job with their own doctrine that they cited his formulation of it, see Scott v. Stanford, L.R. Eq. 718, 722 (1867).

Parliament stepped in though, and altered the landscape with a statutory "fair dealing" provision, and subsequent particular defenses. (Here is a link to an article comparing the Google Book Search project under U.S. and U.K. law). Chief Brindley's complaint is that contracts containing DRM obligations are stripping libraries and their users of fair dealing. That is an issue faced here, of course, by cases line ProCD and Bowers. It is, as Yogi Berra said, in his best French, deja vu all over again.

Presumption of Irreparable Harm: Why?

A unique feature of copyright law (also found to varying degrees with patents and trademarks ), but one that in my opinion been misunderstood and misapplied is the judicially created principle of presuming irreparable harm automatically when the movant establishes a likelihood of success. The presumption is applied by all circuits, except the Fifth Circuit, which expressly does not apply the presumption. The Eleventh Circuit applies the presumption generally, but not where there is a bona fide fair use defense. It has not been approved by the District of Columbia Court of Appeals yet, although some trial judges in that circuit have applied it.

The presumption is of a relatively recent vintage, appearing as a discrete statement first in dictum in the American Metropolitan Enterprises of New York, Inc. v. Warner Bros. Records, 389 F.2d 903, 905 (2d Cir. 1968) and later in other circuits. The relevant passage from American Metropolitan is: “A copyright holder in the ordinary case may be presumed to suffer irreparable harm when his right to the exclusive use of the copyrighted material is invaded.” This dictum is all the more remarkable because the remedy at issue was strictly legal: the dispute was over mechanical compulsory license fees under the predecessor to current Section 115. Even more remarkable is the fact that the Second Circuit did not apply the presumption; instead, it affirmed the district court’s refusal to grant a preliminary injunction on the ground that an adequate legal remedy existed:

“[T]he usual rationale for granting a preliminary injunction upon the showing of a prima facie copyright infringement does not apply where the copyright covers musical compositions mechanically reproduced since the copyright holder does not have any exclusivity once he has permitted use. No irreparable injury may be presumed in such a situation. “

While this is correct regarding a compulsory license fact pattern, there was no supporting authority for the dictum that in the “ordinary case” irreparable harm may be presumed. The discussion immediately preceding the statement concerned a different proposition, i.e., a number of cases had held that “upon the showing of a prima facie case of infringement a copyright holder is entitled to a preliminary injunction without a detailed showing of irreparable harm.” The cases cited in support of this proposition state exactly that, but no more. Nor was there any guidance on what an “ordinary” copyright case is or how to apply the presumption: even in “ordinary cases” is the presumption a substitute for any obligation on plaintiff’s part to produce evidence of irreparable harm? What if defendant introduces some evidence showing there is no irreparable harm? Does the presumption vanish and does plaintiff then have to present evidence? A quick look at Federal Rule of Evidence 301 provides the answers.

“In all civil actions and proceedings not otherwise provided for by Act of Congress or by these rules, a presumption imposes on the party against whom it is directed the burden of going forward with evidence to rebut or meet the presumption, but does not shift to such party the burden of proof in the sense of nonpersuasion, which remains throughout the trial upon the party on whom it was originally cast.”

A presumption may be used, consistent with Rule 301, as a device to temporarily shift the burden of going forward with the contrary evidence. A presumption does not shift the ultimate burden of persuasion, which always remains on plaintiff. Thus, in the case of a motion for a preliminary injunction, the burden of establishing entitlement to that relief always remains on the movant regardless of whether a presumption may be applied for one or more factors, e.g., irreparable harm. A presumption merely affords the party for whose benefit it runs “the luxury of not having to produce specific evidence to establish the point at issue.” The luxury is short-lived and shallow, though: a presumption still involves an obligation to produce a minimum quantum of evidence sufficient to call into question the existence of the presumed fact, albeit “nothing more” When evidence contrary to the presumption is introduced, the presumption is not only rebutted, it vanishes. Or, as the Supreme Court put it:” The presumption, having fulfilled its role of forcing the defendant to come forward with some response, simply drops out of the picture.” At this point, plaintiff may still succeed (and perhaps quite easily in a given case) by presenting evidence of irreparable harm, but he is “now put to his factually-supported proof.”

There are two reasons why the presumption vanishes once a minimum quantum of evidence sufficient to call into question the existence of the presumed fact is introduced by the nonmoving party. First, a presumption is not evidence. The second reason is that Congress intended the presumption to vanish under the “bubble bursting” or “Thayer” theory. The legislative history on this point is definitive.

The debate about the status of a presumption once rebutted may be traced to two conflicting schools. The first is that of James Bradley Thayer, whose 1898 treatise, A Preliminary Treatise on Evidence, took the view that a presumption drops out from the case once rebutted. This approach is also called the “Thayer” or “bursting bubble” theory. The second school is that of Professor Edmund Morgan, who in 1933 proposed that a rebutted presumption should remain in the case to be given whatever weight the trier of fact wishes to give it, although rebuttal would still shift the burden of production back to plaintiff. These two schools battled it out like the ancient Talmudic schools of Hillel and Shammai during the 13 years of study that went into the development of the Federal Rules of Evidence, culminating in their enactment by Congress in 1974.

Although the Supreme Court promulgated the rules on November 20, 1972, to take effect on July 1, 1973, questions were raised about the Court’s authority, and thus on February 5, 1973, after Congress blocked their implementation, Chief Justice Burger transmitted the proposed rules to Congress, which extensively revised them. The amendments made by Congress to Rule 301 are highly relevant. The Supreme Court’s version of Rule 301 provided that in all cases a presumption imposes on the nonmoving party the burden of proving that the nonexistence of the presumed fact is more probably than its existence. This approach is well beyond that advocated by Professor Morgan. Indeed, the Advisory Committee on Rules of Evidence of the Judicial Conference took the position that the Court went to far by permanently altering the burden of persuasion. The committee therefore proposed the approach advocated by Professor Morgan in the following language: “[A] presumption imposes on the party against whom it is directed the burden of going forward with the evidence, and, even though met with contradicting evidence, is sufficient proof of the fact presumed to be considered by the trier of fact.

The House passed the Advisory Committee version. In the Senate, the Advisory Committee and the Judicial Conference’s Standing Committee on Practice and Procedure agued for adoption of the House approach. The Senate Judiciary Committee rejected the proposal, describing the Advisory Committee/House version as “ill-advised.” The Senate’s rejection was based on its view that “[p]resumptions are not evidence, but ways of dealing with evidence,” and that treating presumptions as evidence requires deeming “as evidence” facts for which there is no evidence. The Committee therefore amended the proposed rule to its current form. The purpose of the amendment was “to make clear that while evidence of facts giving rise to a presumption shifts the burden of coming forward with evidence to rebut or meet the presumption, it does not shift the burden of persuasion on the existence of the presumed facts. The burden of persuasion remains on the party to whom it is allocated under the rule governing the allocation in the first instance.” As this passage makes clear, Rule 301 contemplates a situation where some actual evidence is initially introduced, which in turn gives rise to a legal presumption regarding a difference fact. The Senate’s explanation of Rule 301 does not contemplate a situation where no evidence is presented, yet a presumption still arises and for the obvious reason that a presumption is not evidence and therefore no legal conclusion can be dram from the utter absence of evidence.

Undaunted, the Advisory Committee and the Judicial Conference lobbied the conference committee, telling the committee that “basically the choice to be made in treating the effect of given presumptions lies between giving them only the effect of a “bursting bubble” and giving them the greater effect of imposing a burden of disproof once evidence has established the conditions that call the presumption into operation.” The conference committee recommended adoption of the Senate version, and that was the version that passed Congress and was enacted. Rule 301 thus adopts the Thayer/bursting bubble approach to presumptions.
The reason for the Senate (and ultimately Congress’s) rejection of the Morgan/Advisory Committee/House approach is easy to understand. That view correctly noted that rebuttal “does not eliminate from the case the evidence itself that gave rise to the presumptions.” And there should be no bar to such predicate evidence going to the trier of fact. But the Morgan/Advisory Committee advocates wanted more: once the predicate evidence was introduced but was rebutted, the presumption was nevertheless to remain, with its weight to be determined by the trier of fact.

A proper understanding of Rule 301 renders the per se presumption of irreparable harm in copyright cases seemingly utilized in the Ninth Circuit highly suspect since in copyright cases the presumption of irreparable harm is used in lieu of evidence and no as a gap-filler once predicate evidence is first established. In copyright cases, if there were evidence of irreparable harm, there would be no need for the presumption. Moreover, the presumption of irreparable harm in copyright arises from an unconventional source, a showing of likelihood of success on the merits. That showing, though, has nothing inherently to do with irreparable harm from an evidentiary standpoint. A plaintiff could have a virtual certainty of prevailing on the merits, but the loss be entirely compensable by monetary damages, as where plaintiff proves there is one-to-one displacement of sales, or where plaintiff elects statutory damages. Perhaps as important, the threshold showing for any grant of interim injunctive relief is, irreparable harm, not a likelihood of success on the merits (although such success is also required). To permit a showing of likelihood of success on the merits to establish irreparable harm is not only to collapse two factors into one; it collapses the dog into the tail.

Finally, compelling plaintiff to establish actual evidence of irreparable harm is consistent with the general rule that where facts relating to a disputed issue lie peculiarly within the knowledge of one party, placing the burden of proof on his or her adversary is unfair. Nowhere is this principle more appropriately applied than where on party claims irreparable harm. Such harm is entirely within the knowledge of the party asserting its existence.

In sum, the presumption of irreparable harm cannot be justified on a blanket basis, and if applied at all, is a mere burden-shifting device, not evidence. Once some contradictory evidence is introduced by the nonmoving party, the presumption vanishes. If plaintiff fails to introduce convincing evidence of actual irreparable harm, the request for injunctive relief must be denied.

An Instructive Fair Use Case

Sometimes cases out of the mainstream can distort basic issues, as Judge Leval believes Sony did in the fair use area. But other times, the off-beat can be helpful; that, I think is the situation with an April 18th opinion from the Southern District of Georgia, Gulfstream Aerospace Corp. v. Camp Systems International, Inc. Plaintiff is the manufacturer of the jet aircrafts beloved by those with real money, and envied by those who aspire to that status, or who simply bewail their fate stuck in coach on a flight from New York to Australia. As part of its FAA obligations, Gulfstream must write and distribute maintenance manuals for each of its aircraft models. Each owner of an aircraft must possess a copy, which Gulfstream licenses for $8,500 a year. Gulfstream also has an online tracking service so that customers are aware what needs to be serviced and when.

Defendant does not manufacture aircraft, but instead provides maintenance tracking services for them. Gulfstream refused to license a copy of its manual to Defendant. To get around this problem (and an FAA ban on defendant producing its own manual), Camp asked Gulfstream owners to borrow their copy of the manual, from which defendant then loaded parts onto its servers. Gulfstream could not lose any sales of the manual from defendant's activity because each aircraft owner was required to own a copy, which they could only get from Gulfstream. Defendant asserted fair use.

The court found the use was commercial and not transformative. The nature of the work was factual. The amount copied was in one respect the entirety, but in another - what was actually used - less than the whole since defendant only "extracted" (the court's quote marks) those parts it needed to perform the specific maintenance tasks. There was no market harm to the manuals, but Gulfstream claimed harm from loss of fees for a competing tracking service, and also implausibly claimed that defendant had created a derivative work. The court rejected both arguments and noted the FAA, despite prohibiting defendant from producing a manual, came out against Gulfstream's effort to restrict defendant's use.

The use in Gulfstream bears little resemblance to a traditional fair use case, and while the opinion contains a traditional analysis, in the end, the court viewed the effort as one of attempted monopolization of services through an assertion of copyright. In other words, Buddy your copyright doesn't reach that far.

More Hot Air from Glassblowers

In a December 16, 2005 posting, I discussed a suit brought by Dale Chihuly against two other glassblowers. Mr. Chihuly's work, seen here at his website, may also be viewed at the Bronx Botanical gardens running June 25th through October 29th, and in some of Las Vegas's finest casinos. Today's New York Times has a front page (below the fold) story about the suit, entitled "Copycats, or Inspired by Nature? Glass Artists Face Off in Court?" While there are some pretty color pictures and some interesting information, the title seems to miss the essence of the dispute, although the story itself (by Timothy Egan) does not: that essence is the possible attempt by Mr. Chihuly to assert rights over techniques and style.

Mr. Chihuly's eminence in the field is unquestioned, even though he has not physically created works himself for 27 years due to a surfing accident (so West Coast!). He has 93 employees and a vigorous DVD market for films of his installations. While originality may not be an issue for his complex works, it is the scope of his claims that are the most troubling. This may be a case where a master mistakes himself for the art.