Often our clients are faced with the situation in which they intend to pay someone to create copyrightable content for them in connection with their businesses. This arises frequently in the entertainment industry and related tech businesses as well, as it is becoming a common practice to simply hire an independent contractor to create content where it is too expensive, burdensome, or impossible to create such content oneself. For example, companies frequently engage contractors to design their logos and other graphic elements for their company branding and websites. Other content creators, such as filmmakers, television producers, authors, and musicians, engage the services of others to create portions of their final artistic products (writing music, creating animation or illustrations, etc.).
copyright
What is Copyright?
Basic IP Terminology—What is Copyright?
Many people, especially those in the initial stages of their business or project, are unsure of how to describe and understand the intellectual property (IP) rights that are created in the course of running their business.
IP rights of some kind arise in virtually every type of business venture, and being able to wrap your head around those rights is a good first step toward protecting and monetizing them. So, what do you call the rights that you own?
What is Copyright?
Big News for Small Copyright Claims?
Copyright Office considers new proposals for a copyright small claims court, but specifics are still lacking.
The story is familiar to many artists. A freelance photographer is surprised to find that an online service has reproduced a number of copyrighted images from her website. She reaches out to the organization with phone calls, offers to license her work for what she considers a reasonable fee, and drafts her own “cease and desist” letter. These all go unanswered. Realizing that her only remedy may be to sue, she seeks out an attorney who will file her case in federal court. But the case is too small; attorneys’ fees are high; it would take at least a year to litigate; and the recovery, if she wins, is uncertain. In the end, she simply gives up.
An Expanded Scope for the Copyright Misuse Defense?
We are often reminded that the basis for U.S. copyright law is the short provision of the Constitution giving Congress the “Power…To Promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” [Art. 1, Section 8]
This constitutional source says that the “monopoly” granted must be temporary, and that the restraints (under copyright and patent law) should serve a particular purpose, the promotion of knowledge and art.
Still, over the years, the duration of those “temporary restraints” (exclusive rights) has been increasing. It is also not apparent that the constitutional purpose is a consistently observed guiding principle.
President or Pirate? The DMCA Takedown War of the Presidential Campaigns
In what has been described by some as over-zealous enforcement of copyright, BMG (the large German publisher) forced YouTube to take down a Mitt Romney campaign video because it included footage of President Obama singing Al Green’s “Let’s Stay Together.”
The Power of One: Some Issues in the Application of Complex Copyright Transfer Termination Rights
Authors – even the more successful composers, painters, writers, and other creatives – are familiar with the early career financial struggles that come with devoting oneself to creative work before that “big break.”
An author’s initial negotiations with publishers, producers and distributers often have a “David & Goliath” character, with the author concerned not to overplay his or her hand, or just truly lacking bargaining power.
Many early career artists don’t have lawyers, managers or representation; and publishers and producers are wary when the creator has no track record. The result can be contracts that turn out to be disappointing or seem unfair to the artist, especially in the case where a copyrighted work later proves to be a huge success for the publisher or distributer.
Even absent “exploitation” of the situation, an artist’s “deal points” can be kept low when authors, publishers and distributors all have difficulty anticipating the value or popularity of a new work. Recognition of these difficulties was one reason Congress included the author’s right to terminate a transfer of copyright in the Copyright Act of 1976.
The stated purpose of the termination right was (1) to safeguard authors and creators against transfers to entities that do little or nothing with the work, and (2) to address “the unequal bargaining position of authors, resulting in part from the impossibility of determining a work’s value until it has been exploited.”
When an author successfully terminates a grant, the un-contracted for domestic rights (i.e. U.S.) revert from the assignee publisher or distributor, as the case may be, to the author, often giving the author the opportunity to renegotiate the deal or even find a new licensee.
For works assigned by an author after 1978 (the year the 1976 Act took effect), termination can commence at the start of the 35th year after the date of transfer (during a five year window). Notice of termination must be served on the publisher or distributor (assignee) by the artist at least two years (but not more than 10 years) prior to the anticipated termination date.
Crunching the numbers, this means that 2011 was the last year termination notices were served for a termination to take place in 2013, the first year authors can effect termination (under the 1976 Act) based on proper earlier notice.
With the early instances of what are likely to be many exercises of the termination right, it is critical that both authors and publishers understand the statutory copyright assignment termination provision and how the courts will address the subject. Overall, the procedure for terminating a copyright grant under the 1976 Act is exacting and can be confusing.
The existence of the termination right and the potential consequences of an author’s reclaiming rights are just beginning to be encountered as exercise of the right becomes more prevalent. A recent district of California case, Scorpio Music S.A. v. Willis, has already addressed one question, which, on its face, looks fairly esoteric: where joint authors of a work transfer their respective copyright interests through separate agreements, can a single author alone terminate his separate grant of his copyright interest in the joint work, thereby recovering his unexploited rights (or renegotiating them)? Or must all or a majority of all the authors agree in order to terminate the grant? A California district court sided with the power of a single author in this case. The decision, while specific, gives some insight into the rationales courts may apply to address the odd and unexpected scenarios that exercise of this right may well create.
Last year Victor Willis, the original lead singer of the Village People, terminated grants he had made in 1977 – 1979 to music publishers of his copyright interests in 33 musical compositions, including in the hit songs, “YMCA”, “In the Navy” and “Go West.” Scorpio Music and Can’t Stop Productions, the two companies holding publishing rights to the Village People’s songs, went to court to stop Willis from regaining control over the rights in play. The publishers argued that Willis could not, by himself, exercise a termination right because the songs were created and licensed by several authors, not Willis alone. According to the publishers, the termination of the grant was improper unless a majority of the authors agreed. The district court rejected the publishers’ arguments and granted Willis’ motion to dismiss the publishers’ efforts to block him.
The District Court concluded that the language and purpose of the termination statute, coupled with copyright law governing the individual rights of joint authors, permit a single joint author who has separately transferred his copyright interest to terminate the grant that author made. This holding is limited to a very specific situation. The Court noted that if two or more joint authors entered into a joint grant of their copyright interests, a majority of those authors acting in concert would be essential to the proper exercise of the termination right. The Court explained that requiring a single co-author to get agreement from a majority of joint authors to terminate the co-author’s separate transfer would frustrate the purpose of termination rights; it would be harder for an author to terminate a grant than to transfer it.
This interpretation is consistent with the law governing joint authors. Under the Copyright Act, each co-owner of a joint work owns an equal undivided interest in that work and is allowed, in the absence of an agreement otherwise, to freely act alone to transfer his or her unencumbered rights to a third party. This can lead to chaos, so most often joint authors have copyright administration agreements or do not act alone.
Finally, the Court also addressed the economics of this termination. It refused to limit the single author’s termination to a portion of the intellectual property at stake equal to the percentage interest for which publishers agreed to pay the author in the first place (for Willis, a 12 -20% interest in various songs). The Court held that Willis would get back his copyright interests based on the rights he granted, regardless of the percentage compensation he received for the grant. The Court uses “YMCA” as an example. On the copyright registration Willis is one of three authors listed. The legal assumption is that 3 co-authors each hold 1/3 undivided interest in the copyright. Thus, according to the Court, the terminable rights of Willis would reflect that 1/3 interest, not the approximately 12% interest that he was paid.
No doubt the music industry was watching the Willis case closely as record companies are receiving more and more termination notices from musicians who had hit songs in the 1970’s. Artists such as Bob Dylan, Tom Waits and Tom Petty have conveyed termination notices. The Victor Willis opinion eliminates one argument licensees might have attempted in order to block certain terminations: i.e., arguing that record producers and sound engineers who are co-copyright holders should also be deemed joint holders of the particular termination right and (had Willis not prevailed) capable as majority holders of blocking a single joint author’s exercise of the right to terminate a grant of a copyright.
What comes next in this complicated area? Given the unknowns and the potential for errors and irregularities, it is not surprising that many copyright termination situations are mediated and also, that many artists simply fore go exercise of that right.
2nd Circuit’s Safe Harbor Ruling Influences 9th Circuit to Reconsider: What’s an ISP to do?
Many Internet Service Providers (ISP) assume that take-down requirements with respect to copyright claims are fairly standard and that they can readily avoid copyright liability for posts by users by following some simple rules. The activity in the Courts on the Circuit Courts on this issue shows otherwise.
Art Imitates Art: “Pictures Generation” Artist Richard Prince and Fair Use
The Fair Use doctrine allows others to use copyrighted material without the copyright holder’s permission under certain circumstances. It sets limits on the exclusive rights copyright law grants copyright owners: the rights to reproduce, distribute, perform, display and make derivative works.
Originally a judicially created exception[1], Congress incorporated the fair use exception as a defense into the Copyright Act of 1976 under section 107. While “codified,” the Copyright Act does not precisely define fair use; nor does it provide specific examples.
The Act only offers an open list of areas “such as criticism, comment, [and] news reporting” (which may or may not be Fair Use) and four general factors to consider: (1) purpose and character of the use, which encompasses “transformative use”; (2) the nature of the copyrighted work; (3) the amount of the copyrighted work used; and (4) the effect of the use on the market for the copyrighted work.
As a result, Fair Use is often criticized as unpredictable, even doctrinally incoherent, as courts have applied it over the past thirty years. The Cariou v. Prince copyright saga has not yet added certainty to the field.
It’s been three years since French photographer Patrick Cariou sued Richard Prince, Larry Gagosian, Gagosian Gallery and Rizzoli books for copyright infringement. Prince’s “Canal Zone” series used aspects of at least 31 of Cariou’s ethnographic-style photos of Jamaican Rastafarians without Cariou’s consent. For example, Prince takes a Cariou photo of a Rastafarian against a dense growth of plants and then covers the man’s eyes with blue circles and places an electric guitar in his arms. Prince claimed “fair use,” arguing that he had transformed the original works, as opposed to simply producing what the Copyright Act would consider protected derivative images.
The United States District Court for the Southern District of New York granted Cariou’s motion for summary judgment on the issue of copyright infringement, noting that the pieces had very little “transformative” element. It ordered Prince and the Gagosian Gallery to deliver for impounding all infringing copies of Prince’s work. The gallery and its owners were also found liable for copyright infringement because they had distributed images and sold paintings from “Canal Zone” and had failed to investigate and ensure that Prince had obtained the requisite licenses to use Cariou’s photos. The judged stated that the gallery “at the very least [had] the right and ability (and perhaps even responsibility) to ensure Prince obtained licenses” and “the financial benefit of the infringing use to the Gagosian defendants is self-evident.”
Prince appealed the 2011 District Court decision and is awaiting review by the Second Circuit U.S. Court of Appeals. Since then, museums across the country have filed amicus briefs with the Court of Appeals arguing that the District Court’s decision, holding the gallery and its owners liable, would force them to hire lawyers to analyze works in their collection containing borrowed images. Given the widespread practice of referencing other images in 20th-century art, the cost to the museums would be unsustainable. The less costly, but the more disturbing option, certainly antithetical to the First Amendment principles that underline Fair Use, would be for museums to self-censor.
Cariou’s legal argument rests largely on the claim that Prince’s work failed to comment on or satirize Cariou’s photographs and, therefore, is not transformative. Prince (somewhat arrogantly) testified that that he had no real interest in the meaning behind Cariou’s work, and that he used it strictly as “raw material.” Cariou’s attorneys argue that taking copyrighted work in order to create “something new,” without any aesthetic significance or expressive purpose for the particular appropriation, has no limits and would effectively eviscerate the rights of copyright owners. In fact, Prince was unwilling to explain his art in court and even refused to call his use of Cariou’s photo “satire”, which is typically protected under Fair Use. Prince only offered the following as an explanation: “Hey, this guy is playing the guitar.”
Is this then taking for the sake of taking like Cariou’s lawyers argue? The District Court already balanced the four Fair Use factors finding against Prince in 2011. But will the Second Circuit decide differently, perhaps by choosing to emphasize a factor other than transformative use?
Consider this argument about market effect for a moment. Richard Prince is what is called a “Pictures Generation” artist, a member of that “movement” of artists takes both the commercial and artistic images that surround them, appropriates those images into their own work, and then “subverts” them. The popularity and strength of the Pictures Generation is clearly seen on the price tags on their works that may sell for millions, especially the early works of James Rosenquist and David Salle. Patrick Cariou is not a Pictures Generation artist, but is rather, an ethnographic photographer. Cariou markets a fly-on-the-wall style of reporting, while Prince markets the skepticism of culture. As Michael Rips points out in his opinion piece for the New York Times, it is for this reason that “the markets for Mr. Prince and Cariou are not just distinct; they are conflicting.” If a Prince consumer would not have otherwise spent money on a Cariou-style photo, how could Prince cause economic injury to Cariou? Should Prince be required to turn over his profits or revenue as penalty for infringement? Or can he invoke the fourth factor of Fair Use – effect on the market of the original copyrighted work – to argue that the de minimus monetary effect on Cariou’s market supports his Fair Use defense? Or, if it is the artistic movement, the Pictures Generation, with which Prince is connected that gives value to the paintings, rather than to Cariou’s images, does the context give rise to a “transformative” use?
Whichever Fair Use factor one wishes to emphasize – transformative use or market effect – there is a shifting perspective in the art world, where artists can appropriate works and then sell versions or alterations to collectors for millions of dollars without any benefit accruing to the lesser-known artist. In other art news, Origami artist Robert Lang is suing abstract painter Sarah Morris in the Northern District of California, claiming that she used his designs in her paintings without asking permission. Morris took several of Lang’s crease patterns and changed lines, added colors to the shapes and made the resulting images into very large paintings. Morris argues that the change in context and meaning is transformative. Currently no court date has been set, but Lang says his case is about getting credit for his craft and deciding how his work is used.
France Gives the “Feu Vert” to Google Books
The United States has yet to reach an agreement over the Google digital books project, but France, a literary haven and copyright devotee, has forged ahead.
With what its supporters have praised as a tool for bringing out-of-print books into the hands of new readers, the Google digital books project has sought to digitally scan collections of current and out-of-print books to create a massive digital collection on Google’s database.
Google Disclosures
Last month Google announced a new addition to its website’s Transparency Report.
Google has decided to release information on the number of requests it recieves from copyright owners (and the organizations that represent them) to remove Google Search results that allegedly link to infringing content.
Google’s senior copyright counsel Fred von Lohmann writes on Google’s blog, “We believe that openness is crucial for the future of the Internet. When something gets in the way of the free flow of information, we believe there should be transparency around what that block might be.”