Category Archives: infringement

Where does the injury occur when books copyrighted by a New York publisher are uploaded onto the Internet by an out-of-state entity?

Penguin Group (USA) Inc. (“Penguin”), a New York corporation with its principal place of business in New York City, sued American Buddha, a not-for-profit corporation with its principal place of business in Arizona, for copyright infringement in the United States District Court for the Southern District of New York.  Penguin claimed that American Buddha infringed upon copyrights owned by Penguin for four books.  American Buddha allegedly published complete copies of those books on its two web sites, making them available free of charge to its 50,000 members and to anyone else with an Internet connection.  The electronic copying and uploading of the books by American Buddha took place in either Oregon or Arizona.  American Buddha claimed its right to copy and upload the books was protected by sections 107 and 108 of the Copyright Act, 17 U.S.C. §101 et seq., which govern fair use and reproduction by libraries and archives.  Penguin disputed that any exception to the Copyright Act applied to American Buddha’s activities.  Penguin Group (USA) Inc. v. American Buddha, CITATION

American Buddha moved to dismiss Penguin’s complaint on the ground that its ties to New York were too insubstantial for it to be subject to personal jurisdiction in that state.  Penguin countered that American Buddha was subject to personal jurisdiction in New York under CPLR 302 (a) (3) (ii) as it committed a tortious act outside of New York that resulted in injuries in New York.  American Buddha countered that CPLR 302 (a) (3) (ii) did not apply since Penguin did not suffer an injury within New York State.  The District Court granted American Buddha’s motion to dismiss holding that Penguin sustained injury in either Oregon or Arizona, which was where the copying and uploading of the books occurred.  The court reasoned that Penguin “suffered only a ‘purely derivative economic injury’ in New York based on its domicile here, which was insufficient to trigger CPLR 302 (a) (3) (ii).”  Id. at p.3.  Penguin appealed the decision of the District Court to New York’s Court of Appeals, which was asked to decide the following certified question:

“In copyright infringement cases involving the uploading of a copyrighted printed literary work onto the Internet, is the situs of injury for purposes of determining long-arm jurisdiction under N.Y. C.P.L.R. § 302 (a) (3) (ii) the location of the infringing action of the residence or location of the principal place of business of the copyright holder?”

The Court of Appeals determined that the location of the infringing action for purposes of New York’s long-arm jurisdiction was the location of the principal place of business of the copyright holder.  Under N.Y. C.P.L.R. § 302 (a) (3) (ii) long-arm jurisdiction may be exercised by a New York court when, 1) the defendant commits a tortious act outside New York; 2) the plaintiff’s cause of action arose from that tortious act; 3) the tortious act caused an injury to a person or property in New York; 4) the defendant expected or should reasonably have expected to act to have consequences in New York; and 5) the defendant derived substantial revenue from interstate or international commerce.  The only issue to be decided by the Court of Appeals was the third element – “whether an out-of-state act of copyright infringement has caused injury in New York.”  Id. at p.5-6.

While acknowledging that determining the location of the injury was more difficult when the alleged infringement involved the Internet, the court was persuaded by two factors to decide that “ a New York copyright owner alleging infringement sustains an in-state injury pursuant to CPLR 302 (a) (3) (ii) when its printed literary work is uploaded without permission onto the Internet for public access.”  Id. at p.9.  First, the intended consequences of American Buddha’s activities – the instantaneous availability of works copyrighted by Penguin on American Buddha’s web site for anyone, in New York or elsewhere, with an Internet connection to download and read the works free of charge.

Second, the unique bundle of rights given to copyright owners tipped the balance in favor of determining New York as the situs of injury.  These five “exclusive rights” include, the right of reproduction; the right to prepare derivative works; the right to distribute copies by sale, rental, lease or lending; the right to perform the work publicly; and the right to display the work publicly.  17 U.S.C. §106.  As a result, a copyright owner has an “overarching ‘right to exclude others from using his property.’”  Id. citing eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 392 (2006).

Combining the aforementioned factors led the court to reason that a New York copyright holder “whose copyright is infringed suffers something more than … indirect financial loss.”  Id. at p.11.  For example, one potential harm of copyright infringement is the loss or diminishment of the incentive to publish or write.  Id. at p. 11.  A tort committed outside of New York that was likely to cause harm through the loss of business inside of New York was “sufficient to establish personal jurisdiction regardless of whether damages were likely recoverable or even ascertainable.”  Id. at p.12.

Further, there was no dispute that American Buddha’s web sites were accessible by any New Yorker with an Internet connection.  Therefore, “an injury allegedly inflicted by digital piracy is felt throughout the United States, which necessarily includes New York.”  Id. at p.12.  The court also distinguished the uploading of copyrighted books to the Internet from traditional commercial tort cases where the injury was generally linked to the place where sales or customers were lost.  The location of the infringement in such cases was unimportant since the goal was to make the copyrighted works available to anyone with an Internet connection, including those in New York.  Thus, “the concurrence of these two elements – the function and nature of the Internet and the diverse ownership rights enjoyed by copyright holders situated in New York – leads us to … conclude that the alleged injury in this case occurred in New York.” Id. at p.13.

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© 2011 Nissenbaum Law Group, LLC

One Cannot Use Someone Else’s Trademark under the “Historical Use” Exception Unless it is True Historical Use.

On September 2, 2010, the United States Court of Appeals, Fourth Circuit, decided a case that discussed the Historical Use Exception to the Trademark laws. That exception allows a trademark to be used by someone other than the legal owner of it if it is included in an historical work. It is essecually an exception that provides for Fair Use of the trademark.

Specifically, the Court in Bouchat v. Baltimore Ravens Limited Partnership, et al. –F.3d–, 2010 WL 3440867 (C.A.4 (Md.)) held that the Ravens and the NFL did not establish fair use of the Flying B logo in the highlight films sold by the NFL and the highlight film played during the Ravens’ home football games.  The Court analyzed the four statutory factors of fair use as listed in 17 U.S.C.§ 107, which are:  (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.  Although the Court considered all four factors, it primarily analyzed the first factor, purpose and character of the use, and defendants’ alleged defense of historical use of the logo.  The Court stated:    
There is no transformative purpose behind the depiction of the Flying B logo in the highlight films.  The use of the logo in the films serves the same purpose that it did when defendants first infringed Bouchat’s copyrighted Shield logo design: the Flying B logo identifies the football player wearing it with the Baltimore Ravens.  The simple act of filming the game in which the copyrighted work was displayed did not add something new to the logo.  It did not alter the logo with new expression, meaning or message.  The films capture the logo as it originally appeared, and the logo remains a symbol identifying the Ravens.  While the films no doubt add to the historical record of Ravens play, the use of the logo in those films simply fulfilled its purpose of identifying the team.  The logo continues to fulfill that purpose whenever a highlight film is shown.    

Id. at 4.

Simply filming football games that include the copyrighted logo does not transform the purpose behind the logo’s use into a historical one.  Defendants point to the dramatic editing, music, and narration in the highlight films in an attempt to show a transformative use for the logo.  But none of these effects transform the purpose behind the display of the logo.  The narrator in the films never comments on the controversy surrounding the use of the Flying B logo. Nor are the films a documentary on the history of the Ravens logo.  Instead, the films simply capture highlights of three Ravens seasons and necessarily portray the Flying B logo as it was actually used to identify the Ravens team.

Id. 

The Court held that the “Ravens and the NFL originally violated Bouchat’s copyright by using his logo as the Ravens logo. Highlight films that come along later and depict that same use, without transformation, cannot stand as a fair use.”  Id. at 8.


Comments/Questions: ljm@gdnlaw.com

© 2009 Nissenbaum Law Group, LLC

A Federal Court Analyzes Whether One Manuscript Allegedly Violates the Copyright Protection of Another

A Florida Federal Court recently discussed the standard for determining if one manuscript violates the copyright of another. Brian Dodd v. Chris James Woods, Film Ranch International, Inc., 2010 WL 2367140 (M.D.Fla. 2010).
The Underlying Facts
The plaintiff in that case, Brian Dodd (“Dodd”), alleged several causes of action which “arose after Defendant Chris Woods allegedly stole Dodd’s manuscript entitled “Anonymity” and gave it to Defendant Film Ranch International, who allegedly used it in producing a film entitled “Brainjacked.” Id. at 1.
The Legal Standard for Alleging Copyright Infringement
The Court explained that “[t]o establish a prima facie case of copyright infringement, ‘two elements must be proven: (1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original.’ Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., Inc., 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). ‘To satisfy Feist’ s first prong, a plaintiff must prove that the work … is original and that the plaintiff complied with applicable statutory formalities.’ Bateman v. Mnemonics, Inc., 79 F.3d 1532, 1541 (11th Cir.1996) (citations omitted). A plaintiff may show copying by demonstrating that the defendants had access to the copyrighted work and that the works are ‘substantially similar.’ Oravec v. Sunny Isles Luxury Ventures, L. C., 527 F.3d 1218, 1223 (11th Cir.2008) … .If the plaintiff cannot demonstrate access, he still may establish copying by showing that the works are “strikingly similar .” Id. (citing Corwin v. Walt Disney Co., 475 F.3d 1239, 1253 (11th Cir.2007)).

“Substantial similarity exists “where an average lay observer would recognize the alleged copy as having been appropriated from the copyrighted work.” Id. (quoting Original Appalachian Artworks, Inc. v. Toy Loft, Inc., 684 F.2d 821, 829 (11th Cir.1982)). In particular, a copyright plaintiff “must establish specifically that the allegedly infringing work is substantially similar to the plaintiff’s work with regard to its protected elements.”   Leigh v. Warner Bros., Inc., 212 F.3d 1210, 1214 (11th Cir.2000). ‘Thus, in an action for infringement, it must be determined both whether the similarities between the works are substantial from the point of view of the lay [observer] and whether those similarities involve copyrightable material.’ Herzog v. Castle Rock Entm’t, 193 F.3d 1241, 1248 (11th Cir.1999).” Id. at 3.

The Court Determines That the Complaint Fails to State a Claim for Copyright Ownership Because it Failed to Allege Facts that the Manuscript was Substantially Similar

The Court held that the complaint failed to state a claim for copyright ownership because “[i]n a copyright action, the similarity between two works must concern the expression of ideas, not the ideas themselves. Oravec, 527 F.3d at 1224. Here, Dodd has only generally alleged that the two works are similar in concept and method, and that a character from Brainjacked has the same name as the main character from Anonymity. As an initial matter, copyright protection does not extend to Dodd’s ideas, concepts or methods. See 17 U.S.C. § 102(b) (“In no case does copyright protection for an original work of authorship extend to any idea, … method of operation, concept, … regardless of the form in which it is described, explained, illustrated, or embodied in such work.”). Therefore, aside from a character from each work sharing a name, (which by itself could not amount to substantial similarity), Dodd has failed to allege any other specific aspects of Anonymity and Brainjacked that are similar.” Id. at 4-5



Comments/Questions: ljm@gdnlaw.com

© 2009 Nissenbaum Law Group, LLC