Tuesday, August 27, 2013

The Truth About Digital Copyright Infringement’s Effect on the Film Industry

Below is an excerpt form my most recent posting on the Canadian Intellectual Property Blog. The post discusses a recent study detailing the effect of illicit on-line file sharing on the film industry.

Those of us who remember the Recording Industry Association of America (RIAA) music piracy witch hunt of 2004-2007 and the colorful, if not flamboyant ranting of the late Jack Volenti of the Motion Picture Association of America (MPAA) may be predisposed to thinking that on-line file sharing has had a dreadful effect on the music and film industries.

Image by Renjith Krishnan
A recent study, however, may dispel that myth, at least as it relates to the film industry. Researchers from the Ludwig-Maximilians-Universit├Ąt Munich and Copenhagen Business School have found that far from hindering sales, on-line file sharing has even had a positive effect on some films’ bottom line. The study looked at a sizeable data set- 10,272 movies released in 50 countries from week 31 of 2007 to week 5 of 2013.

On January 19, 2012, the globally popular file hosting site Megaupload.com was shut down and its founder Kim Dotcom arrested. The study found that the shutdown had little effect on the box office numbers for a majority of films. Some films, particular smaller and independent productions, saw a decrease in revenue. Only the top Hollywood films such as Ice Age and Harry Potter saw an increase in revenue after the Megaupload shutdown.

The Full post may be found here

Tuesday, August 13, 2013

Kirby Estate Denied Right to Terminate Copyright License for X-Men, Spiderman, Hulk and Ironman Comics

Here is a brief excerpt of my blog post as featured on the Canadian Intellectual Property Blog dealing with the 2nd Circuit Court of Appeal's recent decision to deny the estate of the late comic book illustrator Jack Kirby the right to terminate its copyright licenses as per §304 17 USC. The Court found the works in question were works for hire and therefore fell under the exception to the §304 protection.  The full post is available here.

The US Court of Appeal for the 2nd Circuit ruled yesterday that the estate of famous comic book illustrator Jack Kirby could not terminate the copyright license held by Marvel Comics and Disney corp. (Marvel/Disney). Jack Kirby is known as one of the most prominent comic book illustrators of all time. He began his career as an illustrator in the 1930s when he created the now famous Captain America series.  
At issue in this case were drawings Kirby did between 1958 and 1963. Jack Kirby’s children sought to apply the complicated “termination provision” found in §304 17 USC. This provision allows the owner of a copyright protected work to terminate any assignment or license agreement after a defined period which depends on whether the work was created before 1978.

Wednesday, August 7, 2013

USTR disapproves of ITC decision on Apple import ban

Bellow is an excerpt from an article I published on the Canadian Intellectual Property Blog (CIPB) regarding the USTR's overturning an ITC decision to prohibit Apple Inc. from importing its phones and tablets that infringe a Samsung Electronics Co. Patent.

On June 4th, 2013, the International Trade Commission (ITC) issued a ruling prohibiting Apple Inc. (Apple) from importing its iPhone 3G, iPhone 3Gs, iPhone 4, iPad and iPad 2 because they infringe a patent owned by Samsung Electronics Co. (Samsung). On August 3rd, the United States Trade Representative (USTR), in a rare interventionist move, disapproved of the ITC’s ruling allowing Apple to continue its importation of the infringing products. 
Under § 1337 of the Tariff Act, the ITC may issue an exclusion order (injunctive type relief) against an entity that imports a patent infringing product. In deciding whether to grant the exclusion order, the ITC must consider the effects of the order on US trade and commerce. If the ITC believes that the public interest would not be best served by the issuance of the exclusion order, it has the discretion to refuse it. 
Samsung’s patent is what is known as a “standard-essential patent” (SEP). These patents cover inventions that must be incorporated into a given device if they are to meet some applicable technical standard. SEPs have the potential to give vertically integrated patent holders an advantage over their competitors whom, for all intents and purposes must license the technology from them. 

Please find the full article here

Thursday, August 1, 2013

Faulkner Estate loses copyright infringement suit over use of one line from Requiem for a Nun

In Faulkner Literary Rights, LLC v. Sony Pictures Classics Inc., the estate of William Faulkner sued Sony Pictures over use of a single line from Faulkner’s book, Requiem for a Nun, even though the character attributed the line to Faulkner in the scene of the film. The film in question was Midnight in Paris which was written and directed by Woody Allen. Chief Judge Michael P. Mills of the US District Court for the Northern District of Mississippi granted Sony’s motion to dismiss the suit for lack of a reasonable cause of action (roughly equivalent to a motion to strike in Canada).

At the heart of this case was the following sentence from Faulkner’s novel: “The past is never dead. It’s not even passed”. In Allen’s film, the protagonist Gil Pender says: “The past is not dead. Actually, it’s not even past. You know who said that? Faulkner, and he was right. I met him too. I ran into him at a dinner party.” As can be seen from this quote, the character actually attributes the slightly modified line to Faulkner in the movie itself. This was apparently insufficient for the Faulkner Estate who decided to sue Sony for copyright infringement and for some form of trademark/appropriation claim based loosely on the Lanham Act (the United States federal statute dealing with trade-marks and unfair competition).

Photo by Renjith Krishnan
Among the issues the Court was tasked with deciding was the question of de minimiscopying. The Latin maxim de minimis non curat lex stands for the proposition that the law does not concern itself with the very minor or insignificant. This doctrine has been accepted as applicable in the copyright context in both the Unites States and Canada.

Given the Fifth Circuits thin case law on the matter of de minimis copying, the Court chose to examine the question under the ambit of the fair use analysis- which Sony put forward as an affirmative defense to the claim. The third factor in the fair use analysis is: “the amount and substantiality of the portion used in relation to the copyrighted work as a whole”. This factor mirrors the “substantiality test” used by several US jurisdictions to determine if there was a copyright infringement in the first place.

Originating in the 2nd Circuit, the substantiality test was first applied in Marks v. Leo Feist, Inc. In that case, the Court wrote that: “To constitute an infringement of the [Plaintiff’s] composition, it would be necessary to find a substantial copying of a substantial and material part of it.” This test derives from the equitable doctrine of substantiality. Historically, a plaintiff would not succeed in their claim at equity if the injury suffered was not deemed substantial enough for the law to take an interest.

The Plaintiff argued that since the test for substantial similarity is a qualitative and not quantitative analysis, the two sentence quote is enough to constitute copyright infringement in theory. They further claimed that the quote in question described “the essence of Requiem”. The Court did not find this argument persuasive. Even if the quote encapsulated the theme of the book, it is the expression- i.e. the text itself- that is protected by copyright law. The argument failed because of the idea-expression dichotomy at the heart of copyright law. Expressions are protectable; ideas are not.

The Plaintiff’s claim based on the Lanham Act was sketchy at best, referring to state tort law by analogy to make its point. The Court rejected this argument out of hand, writing that the Plaintiff was unsuccessful in clearly laying out the law upon which its complaint relied. In a nutshell, the Plaintiff argued that use of the line in the movie would cause confusion as to its origin. They argued further that use of the line without permission amounted to a misappropriation of Faulkner’s identity. Though the Court declined to deal fully with this argument because of the way it was brought, Chief Judge Mills noted in passing that Sony’s 1st amendment right must trump the Plaintiff’s claim under the Lanham Act.

All in all this decision was unsurprising. While the Plaintiff was correct in asserting that the relevant measure for determining what constitutes a substantial part of a copyright protected work is quality and not quantity, its arguments were patently absurd in the context. To purport that nine words out of a 240 page novel constitutes the qualitative heart of the work is a serious stretch. Even if they were able to make this argument convincingly, this is still a cut and dried instance of fair dealing. Woody Allen used the line in a novel and transformative way that in no way affects the commercial value of the source work.