INTERNET LAW BLOG

What state law claims are preempted by the federal law embodied in the Copyright Act?  This question was recently addressed in Stadt v. Fox News Network LLC, 719 F.Supp.2d 312 (S.D.N.Y. 2010).

In that case, Kenneth Stadt (“Stadt”), a video owner, filed a lawsuit against Fox News Network (“Fox”), a cable television network, for among other things, copyright infringement and breach of contract.  Stadt was the exclusive owner of a video that he registered with the United States Copyright Office that depicts a famous couple on vacation (“Video”).  Stadt and Fox entered into a written License Agreement (“Agreement”) in which Fox was given the sole right to air the Video on its network within a one month period.  See Id. at 316.

Stadt alleged that Fox promised to stop using the Video upon expiration of the License, and in exchange for that promise Stadt allowed Fox to broadcast the Video with a “Fox Business Exclusive” credit on the screen. However, Stadt claimed that Fox continued to make use of the Video and credit after the Agreement expired.  Fox moved to dismiss all the claims except the copyright claim, stating that “the claims are preempted by section 301 of Title 17 of the United States Code (the Copyright Act), fail to state a claim as a matter of law, or both.” Id. at 315.

The Court relied on Briarpatch Ltd. v. Phoenix Pictures, Inc., 373 F.3d 296 (2d Cir. 2004) to determine when the Copyright Act shall preempt state law. Id. at 317.  In Briarpatch, the Second Circuit held that the Copyright Act exclusively governs a claim when:

(1) the particular work to which the claim is being applied falls within the type of works protected by the Copyright Act . . .; and

(2) the claim seeks to vindicate legal or equitable rights that are equivalent to one of the bundle of exclusive rights already protected by copyright law….

See Briarpatch Ltd. v. Phoenix Pictures, Inc., 373 F.3d 296 (2d Cir. 2004).

The Briarpatch Court further stated that the first prong of this test is called the “subject matter requirement,” and the second prong is called the “general scope requirement.”  The general scope requirement is satisfied only when the state-created right may be abridged by an act that would, by itself, infringe one of the exclusive rights provided by federal copyright law.  The state law claim must not include any extra elements that make it qualitatively different from a copyright infringement claim.  Additionally, the Briarpatch Court explained that to determine whether a claim is qualitatively different, it will look at “what [the] plaintiff seeks to protect, the theories in which the matter is thought to be protected and the rights sought to be enforced.” Stadt, 719 F.Supp.2d at 317-18 (citing Briarpatch Ltd. v. Phoenix Pictures, Inc., 373 F.3d 296 (2d Cir. 2004)).

The Stadt Court stated that it takes a ‘restrictive view’ of what qualifies as an extra element sufficient to shield the claim from copyright preemption.  Nevertheless, ‘a state law claim is qualitatively different if it requires such elements as breach of fiduciary duty, or possession and control of chattels.” Stadt, 719 F.Supp.2d at 318.

To establish breach of contract in New York, a plaintiff must 1) confirm the existence of an agreement; 2) show that plaintiff has adequately performed pursuant to that contract; 3) show that the accused has breached the contract; and 4) show that there are damages.  See Id. 

The Stadt Court found that the “subject matter” requirement for federal preemption to apply was met because the subject matter of Stadt’s breach of contract claim related to the continued use of a video that was governed by the Copyright Act.  However, the “general scope” requirement was not satisfied because Stadt’s claim that Fox continued to make use of the credit following expiration of the Agreement added an “extra element that render[ed Stadt’s] breach of contract claim qualitatively different from a claim for copyright infringement.” Hence, that additional aspect of the claim was not governed by the Copyright Act.  Id. at 320-21.  In other words, the additional allegation of continued use of the credit went beyond what the Copyright Act governs and therefore survives preemption.  See Id. at 321.  Ultimately, the Stadt Court denied Fox’s motion to dismiss the breach of contract claim since only part of the claim was preempted by the Copyright Act.  See Id. at 324.

The preemption of state laws by the Copyright Act is an issue every claimant should be aware of when preparing causes of actions for a complaint involving intellectual property matters.  One should take heed of the two-step prong courts rely on in evaluating when claims meet the criteria for preemption.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC

In Urbont v. Sony Music Entertainment, No. 11 Civ. 4516 (S.D.N.Y. March 27, 2012), the federal District Court for the Southern District of New York was presented with the question of whether the discovery rule applies to causes of action under the Copyright Act.

The discovery rule allows parties to extend a statute of limitations because they did not have reason to know, nor did they know, that they had a potential cause of action.  In this case, application of the discovery rule would have extended the three (3) year statute of limitations under the Copyright Act for infringement.

The court determined that the discovery rule would not apply here because there was no evidence of material concealment of the fraud that led to the alleged infringement.  Instead, the plaintiff had complete access to all the information necessary to determine that an infringement had taken place, and he had simply not brought his cause of action within the applicable period.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC

Appropriation art, which involves an artist purposefully copying the work of another, has become a popular art form. But is it legal? The United States District Court for the Southern District of New York recently faced that question and determined whether appropriators are entitled to use the defense of fair use against a claim of copyright infringement. Cariou v. Prince, 784 F.Supp. 2d 337 (S.D.N.Y. 2011).

The plaintiff in that case, professional photographer Patrick Cariou (“Cariou”), had spent time in Jamaica over the course of six years. After gaining the trust of the Rastafarians, he had been permitted to take their portraits. In 2000, Cariou published a book of his photographs. The book contained those portraits as well as landscape photos he had taken around Jamaica. He testified that he was the sole copyright holder of the images that appeared in his book.

The defendant, Richard Prince (“Prince”), was a well-known “appropriation artist” who had shown his work at several museums. Appropriation art deliberately copies images and presents them in a new version or context. During an exhibit at a hotel in St. Barts between December 2007 and February 2008, Prince showed a collage entitled “Canal Zone (2007)” which included 35 photographs that had been taken from Cariou’s book. Prince painted over some portions of the photos. Some were used in their entirety, while others were only partially used. Prince intended to use “Canal Zone (2007)” as a means of introducing characters he intended to use in a planned series of artworks. Cariou eventually claimed that Prince had infringed on his copyright, but Prince asserted that his works were protected by the defense of fair use.

Cariou possessed undisputed ownership of valid copyright in the photos, which courts have held to be a copyrightable subject matter for more than 100 years. Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53 (1884). The Court then considered whether Prince’s use of Cariou’s copyrighted work should be protected as a type of fair use. When determining whether a particular use of a copyrighted work qualifies as fair use, courts will consider four factors:

1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

2) the nature of the copyrighted work; 

3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and 

4) the effect of the use upon the potential market for or value of the copyrighted work.

17 U.S.C. §107.

First, the Court considered the purpose and character of Prince’s use of the photos. It found its transformative content to be “minimal at best,” its purpose to be “substantially commercial, and interpreted Prince’s failure to obtain permission (and the co-defendant Gagosian Gallery’s failure to inquire as to whether Prince had obtained permission) to constitute bad faith. Cariou at 350-1. Thus, it determined that the first prong weighed heavily against a finding of fair use. Second, the Court found that Cariou’s photos were highly original and creative (as opposed to factual or informational). Thus, the Court held that the use of such works without permission also weighs against fair use. Id. at 352.

Third, the Court considered the amount and substantiality of the portion of Cariou’s photos used in Prince’s works. It found that, in the majority of his works, Prince appropriated central figures that went to the very heart of Cariou’s works, and that this factor also weighed heavily against a finding of fair use. Id. Finally, the Court found the fourth factor to also weigh against fair use because Prince’s secondary use “unfairly damaged the original market for [Cariou’s] [p]hotos and, if widespread, would likely destroy any identifiable derivative market for [them].” Id. at 353. Because none of the four factors considered supported fair use, the Court found that the defendants were not entitled to fair use as a defense. Id.

Prince is appealing the Court’s decision. This case may have a significant impact in both the art and intellectual property industries.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC

Dish Network is in a dispute with almost all of the major television networks over Dish Network’s offering to consumers that allows them to skip commercials in television shows.  The lawsuit is in its earliest stages.  The issue being decided now is what jurisdiction should hear the federal lawsuits.

The reason that this has become such a tangled issue is because not only have CBS, NBC, Fox and Dish itself filed separate lawsuits, but Dish’s lawsuit was filed in New York while the others were filed in California (ABC has not yet filed suit).  This is important because New York case law would appear to favor the Dish Network’s position more than that of the networks.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC

Better equipment, more health-conscious athletes and upgrades in technology have led many to believe that sports are safer today than in the past. But to what degree do athletes assume the risk of injury when they engage in sporting events? That was the question recently before the Appellate Division of the Supreme Court of New York. Bukowski v. Clarkson Univ.¸ 2011 NY Slip 5912, 1 (N.Y. App. Div. 3d Dep’t 2011).

The plaintiff (“Bukowski”) was a freshman pitcher on the Clarkson University (“Clarkson”) baseball team. While pitching from an artificial mound at regulation distance at practice, a batter hit a line drive that struck Bukowski in the face. He sued the University for Damages.     

During the trial, Bukowski testified that he was an experienced baseball player who was aware of the risk of being struck by a batted ball while pitching and that he had had an estimated 50 to 100 balls hit back at him during his career as a pitcher. He also testified that he was familiar with the indoor training facility where he was practicing when the injury occurred. Additionally, Bukowski confirmed that he had been informed by coaches that the live practices were going to be held without the use of an L-screen (a screen that pitchers stand behind for protection), and that prior to taking the mound that day at practice, he had observed other pitchers throwing batting practice without the use of an L-screen. The Supreme Court of New York granted Clarkson’s motion to dismiss, concluding that Bukowski had assumed the obvious risk of being hit by a line drive.      

On appeal, Bukowski argued that factual issues still needed to determine, including whether the risk of being hit by a ball was unreasonably enhanced by the backdrop and lighting of the facility and failure to use an L-screen. However, the Bukowski Court cited previous case law that established that organizers of sporting events owe a duty to exercise reasonable care and protect participants only “from injuries arising out of unassumed, concealed, or unreasonably increased risks. Id. at 2 (citing Benitez v. New York City Bd. of Educ., 73 NY2d 650, 654 (1989)). The Court held that voluntary participants in sporting events are “deemed to have assumed commonly appreciated risks inherent in the activity” and that this assumption of the risk doctrine “extends to risks engendered by less than optimal conditions, provided that those conditions are open and obvious.” Id. at 2.      

Despite testimony by an expert that suggested that the use of an L-screen or a darker backdrop could have lessened the risk, the Court determined that the risk of a pitcher being hit by a ball is inherent in the sport of baseball. Id. Additionally, the conditions in which he was pitching were readily observable, so the Court held that such expert testimony was irrelevant. Id. Bukowski also argued that assumption of the risk is not a shield from liability when voluntariness is overcome by “the compulsion of a superior,” and that he did not ask to use an L-screen because he was told that was not part of the “Clarkson way” of practicing. Id. at 2, 3. However, the Court held that this argument only emphasized Bukowski’s knowledge of the risk while lending “no support to his assertion that his participation in the practice was compelled or involuntary.” Id.          

The Court’s decision in Bukowski underscores not only the dangers that athletes face when engaging in athletic activities, but the difficulty they will face in trying to recover damages from any injuries they suffer during those activities as well. Spectators of sporting events are also likely to face this high hurdle (see Falzon v. MLB Enterprises, et al.). Bukowski and other decisions support the idea that, even if technology has helped make sports safer, fundamental risks of injury still exist and courts will generally find that athletes voluntarily assume them.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC

With the advent of wireless technology, there have been growing concerns about the protection of individual privacy against arbitrary intrusion by government agents. While cell phones help us stay in touch with the important people in our lives, the technology also has the inherent potential for exposing our private lives to others. Over the last couple of decades, the Courts have continued to evolve the Fourth Amendment doctrine to keep up with the privacy concerns raised by the technological advancement in cell phones.

The Fourth Amendment to the United States Constitution guards against unreasonable searches and seizures as follows:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

U.S. Const., amend. IV.

In US v. Katz, 389 U.S. 347, 367 (1967), the U.S. Supreme Court set forth a two-part test to determine whether search was conducted that implicated the Fourth Amendment. Under the two-part test the Courts need to determine:

1. Whether the individual has exhibited an actual expectation of privacy; and
2. Whether the society is prepared to recognize that this expectation of privacy is (objectively) reasonable.

That case was considered a landmark because it made government wiretapping subject to the Fourth Amendment’s warrant requirements.

In 1979, the U.S. Supreme Court also determined that individuals had no reasonable expectation of privacy in the phone numbers used to make or receive calls on their phone.  In that case, Smith v. Maryland, 442 U.S. 735 (1979), the Supreme Court determined that “the installation and use of [a telephone number] pen register was not a “search” within the meaning of the Fourth Amendment, and hence no warrant was required. Pp. 739-746.”  The Court carved out a third party exception to the Fourth Amendment analysis as follows:

Petitioner in all probability entertained no actual expectation of privacy in the phone numbers he dialed, and even if he did, his expectation was not “legitimate.” First, it is doubtful that telephone users in general have any expectation of privacy regarding the numbers they dial, since they typically know that they must convey phone numbers to the telephone company and that the company has facilities for recording this information and does in fact record it for various legitimate business purposes. And petitioner did not demonstrate an expectation of privacy merely by using his home phone rather than some other phone, since his conduct, although perhaps calculated to keep the contents of his conversation private, was not calculated to preserve the privacy of the number he dialed. Second, even if petitioner did harbor some subjective expectation of privacy, this expectation was not one that society is prepared to recognize as “reasonable.” When petitioner voluntarily conveyed numerical information to the phone company and “exposed” that information to its equipment in the normal course of business, he assumed the risk that the company would reveal the information [442 U.S. 735, 736] to the police, cf. United States v. Miller, 425 U.S. 735.

Id. at 741-746.

It is extremely important to contrast the difference between the data conveyed on the pen register in Smith v. Maryland and cellular telephone data that is automatically sent to the cell phone carrier even without the subscriber dialing any numbers. The data that is automatically sent to the cell phone carrier also contains the “cell site location information” (CSLI). The historical CSLI identifies the cell tower to which the customer was connected at the beginning of the call and at the end of the call. Thus, the historical CSLI data can be used to track the previous movements of the cell phone user. Similarly, prospective CSLI data can be used to track the movements of the cell phone user in future.

Several federal courts have held that cell phone users have a reasonable expectation of privacy in the cell site location records. Therefore, the government cannot access CSLI without a warrant as per the Fourth Amendment. But the majority of federal courts have held that this reasonable expectation of privacy is for the prospective CSLI only.  However, recently, the United States District Court for the Eastern District of New York held that the exception to third-party disclosure should also apply to historical CSLI because cell phone users have a reasonable expectation of privacy in the cumulative cell site location records.

As the Fourth Amendment doctrine and the scope of individual’s expectation of privacy continue to evolve with technological developments, attorneys will continue to challenge the legality of the government’s access to these technological advances.

Comments/Questions: gdn@gdnlaw.com

© 2012 Nissenbaum Law Group, LLC