Monthly Archives: November 2011

California Reader Privacy Law: A Privacy Key for the Digital Age

With the increasing use of digital books and online services to browse, read and buy books, it has become essential to have state laws that safeguard readers. Digital books now outsell paperbacks, and the popularity of e-readers in constantly growing.

The digital book services collect a large amount of personal information including the electronic notes made in the margins; the type of books browsed; and how long each page was viewed. The books people read reveal private, often sensitive information about their religious and political beliefs, their personal lives and their health concerns. Therefore, this data is highly personal and sensitive in nature. The existing California law protects book records of public libraries, but does not protect the book records of private libraries and book sellers. As a result, government and third parties can easily collect these reading records to monitor activists as well as use them in legal proceedings involving insurance disputes, divorce proceedings or custody battles.

California has long recognized the importance of safeguarding reading records and has taken an important step in this direction by passing the Reader Privacy Act of 2011 into law. The law, sponsored by Democratic state Sen. Leland Yee, prohibits government and third parties from disclosing or compelling disclosure of any personal information relating to users reading records. It prevents disclosure of data without a court order in a civil case or a warrant in a criminal case. The law imposes civil penalties on a book service provider for knowingly disclosing a user’s personal information to a government entity in violation of this law. It also requires the government or third parties to give notice to the bookseller as well as provide the bookseller with an opportunity to contest the order demanding the information. The booksellers are also required to prepare a report if they surpass 30 requests for information.

Clearly, this law is a key for updating privacy laws in the digital age.  It remains to be seen if this approach will gain traction in other states or on the federal level.

Comments/Questions: gdn@gdnlaw.com

© 2011 Nissenbaum Law Group, LLC

Is a notice terminating a license to use a copyrighted composition sufficient to establish willful copyright infringement?

In a recent decision, the United States District Court for the Southern District of New York held that evidence that a record company continued to sell records containing copyrighted compositions after receiving a notice terminating its compulsory licenses for failure to pay the required statutory royalties was sufficient to establish that the infringement was willful. EMI Entertainment World, Inc. v. Karen Records, Inc.  2011 WL 3795037, 1 (S.D.N.Y.,2011).

Plaintiff, EMI Entertainment World, Inc. is a music publisher and owns copyrights in the four musical compositions at issue in this case. EMI receives royalty payments for its compositions through Harry Fox Agency. Defendants are record companies owned by individual defendants Isabel Rodriguez and her husband Bienvenido Rodriguez. On Janurary 14, 2005, EMI filed a lawsuit for copyright infringement against the record company. Following discover, the Court granted partial summary judgment to EMI with respect to its claims of copyright infringement of the works for which royalty was not paid. However, the Court denied summary judgment to EMI for its claims for statutory damages for willful infringement. The Court requested the parties to submit supplemental evidence indicating the number of infringing sales that occurred during the time period for which damages were sought.

A plaintiff who successfully proves copyright infringement may request the court to award statutory damages under 17 U.S.C. §504(c) in addition to the award of actual damages and profits. “The Copyright Act affords a trial court ‘wide discretion … in setting the amount of statutory damages.’” Id at 2. In determining this amount, the trial court takes into account ‘the expenses saved and the profits reaped by the infringers’; ‘the revenues lost by the plaintiff’; ‘the value of the copyright’; ‘the potential for discouraging the defendant’ and ‘the deterrent effect on other besides the defendant.’ Id. In addition to these factors, it is also relevant to determine whether the defendants conduct was willful or innocent. To prove willful infringement under the Copyright Act, the plaintiff must show that the:

(1) Defendant was actually aware of the infringing activity; or

(2) Defendant’s actions were the result of the reckless disregard for, or willful blindness to, the copyright holder’s rights. Id. at 3.

In this case, EMI advanced three reasons for the Defendant’s willful infringement:

(1) The individual defendants had extensive experience in the industry who owned ‘more than six hundred copyrighted sound recordings and musical compositions’. Id. at 4.

(2) EMI’s prior suit against the Defendant’s with respect to other copyrights made the Defendant’s ‘well aware of the obligations to obtain mechanical licenses and pay statutory license fees for the use of others’ musical compositions.’ Id at 5.

(3) EMI’s letter to the Defendant’s put them on notice about the termination of its compulsory licenses for failure to pay the required statutory royalties. Id.

The Court held that EMI presented a strong circumstantial evidence of willfulness which warranted an award of enhanced statutory damages. The Court awarded EMI $25,000 in statutory damages for infringement of each composition.

Comments/Questions: gdn@gdnlaw.com

© 2011 Nissenbaum Law Group, LLC