Category Archives: News

Liability in US for overseas infringement stemming from domestic, predicative act outside the SOL

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Filed under Extraterritoriality, News, Statute of Limitations

In re Outsidewall Tire Litig., 1:09cv1217 (E.D.V.A. October 18, 2010)

There was an interesting decision on the extraterritorial application of the Copyright Act and the statute of limitations this week. The plaintiffs, an individual and his trio of companies which produced mine vehicle tires, alleged that a group of defendants manufactured and distributed infringing tires. A jury returned a verdict in the plaintiffs’ favor on a series of claims including copyright infringement. Defendants moved for a new trial.

The plaintiffs alleged that the defendants manufactured the infringing tires abroad using designs that were copied in the U.S., outside of the statute of limitations. The Court found that the defendants were domestically liable for damages on the overseas infringement because the infringement was enabled by domestic, predicate acts, even though the domestic acts occurred prior to (what the Court applied as) the statute of limitations period:

Defendants next argue that the verdict should be set aside because no acts of copyright infringement occurred in the United States. As discussed in the July 21 Order, this argument is also unavailing. See July 21 Order, at 14. As an initial matter, the evidence adduced at trial plainly showed (i) that in 2005 and early 2006, Vance copied plaintiffs’ Alpha tire blueprints and modified them to create an infringing derivative work for defendants and (ii) that he did so in part in Virginia. It is true that none of these acts occurred in the United States after October 28, 2006, meaning the acts do not fall within the limitations period for the copyright claims. Indeed, both the manufacturing of the infringing tires based on Vance’s work and the sales of such tires occurred outside the United States during the relevant limitations period. While the Fourth Circuit has  [*30] not yet addressed whether extraterritorial exploitation of a copyright falls within the Copyright Act’s jurisdiction when the domestic, predicate acts occurred prior to the limitations period, the Second and Ninth Circuits have sensibly held that such infringement is covered by the Act. See L.A. News Serv. v. Reuters Tel. Int’l, Ltd., 340 F.3d 926, 928 (9th Cir. 2003); Update Art, Inc. v. Modiin Pub., Ltd., 843 F.2d 67, 73 (2d Cir. 1988). 18 Specifically, the Ninth Circuit has held that while “the Copyright Act does not apply extraterritorially, an exception may apply where an act of infringement is completed entirely within the United States and that such infringing act enabled further exploitation abroad.” L.A. News, 340 F.3d at 928; see also Update Art, 843 F.2d at 73 (in the Second Circuit, holding that although “copyright laws generally do not have extraterritorial application[,] [t]here is an exception . . . when the type of infringement permits further reproduction abroad”). This rule ensures that domestic copyright infringers cannot escape liability for their infringing acts by exploiting the fruits of their infringement in foreign markets. This rule is appropriately applied  [*31] in this case. Defendants cannot escape the reach of the Copyright Act where, as here, they initiated and committed their infringing acts in the United States and then attempted to reap the spoils of their infringement by manufacturing and selling their infringing tires abroad. Thus, they are liable for the foreign acts implementing their unlawful infringement scheme.

FOOTNOTES

18 The Sixth Circuit has also recognized that a court has subject matter jurisdiction over a copyright infringement action “as long as some act of infringement occurred in the United States,” even if most of the infringing conduct took occurred abroad. Liberty Toy Co. v. Fred ilber Co., No. 97-3177, 1998 U.S. App. LEXIS 14866, at *11 (6th Cir. June 29, 1998).

Furthermore, the fact that the domestic acts of infringement occurred outside of the limitations period is irrelevant to defendants’ liability, because the Copyright Act’s statute of limitations limits the remedy, not the substantive rights, under the Act. See Prather v. Neva Paperbacks, Inc., 446 F.2d 338, 340 (5th Cir. 1971) (holding that the limitations period would affects “the remedy only, not the substantive right” under the Copyright Act); Peter Letterese & Assocs. v. World Inst. of Scientology Enters., 533 F.3d 1287, 1320 (11th Cir. 2008)  [*32] (agreeing with the Fifth Circuit’s analysis). Accordingly, defendants are liable for their foreign acts of infringement despite the fact that the domestic acts of infringement occurred before October 28, 2006.

Finally, defendants’ argue that Virginia law was improperly applied to the claims in this action because the wrongful acts did not occur in Virginia. This assertion is plainly meritless, since there is no question that acts of infringement occurred in the Commonwealth of Virginia. The Supreme Court of Virginia has consistently held that it is the place of the wrong that determines which state’s substantive law applies. See Quillen v. International Playlex, Inc., 789 F.2d 1041, 1044 (4th Cir. Va. 1986) (citing McMillan v. McMillan, 219 Va. 1127, 253 S.E.2d 662 (1979)).

International Copyright Representation

Massachusetts Act on automobile diagnostic and repair info

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Filed under News

Last week the Washington Post reported on a bill, Sen. No. 2268, that is making its way through the Massachusetts legislature (included below). The Bill would make car companies provide independent owners and repair shops with the same information and tools that they make available to their authorized dealers, on the same terms.

The Post portrays the Bills as a conflict between “mom-and-pop repair shops” and  manufacturers such as Honda who have “vigorously opposed the right-to-repair bill on the federal level and in other states, such as New Jersey and Arizona.”  A spokesman from a car trade group, in opposition, claimed the Bill would enable aftermarket parts companies to make “inexpensive parts in foreign countries without incurring research and development costs.”

The Bill would grant car owners and repair shops the right to bring an M.G.L. 93(a) (consumer protection and unfair trade practices) claim against an auto manufacturer for treble damages and attorneys’ fees if they do not make the following available on a “reasonable and nondiscriminatory basis and cost as compared to the terms and costs charged to an authorized dealer:

  • The same information for the diagnosis, service, or repair of any motor vehicle that the manufacturer makes available to its authorized dealers and authorized motor vehicle repair facilities.
  • The same tools and software capabilities, including wireless capabilities, related to the diagnosis, service, and repair of a motor vehicle that the manufacturer makes available to an authorized dealership or an authorized motor vehicle repair facilities of the motor vehicle.

Car companies would also have to provide aftermarket tool companies with information that would allow them to  manufacture tools with the same functional characteristics as those tools made available by the manufacturers to  authorized dealers or to an authorized motor vehicle repair facility — I assume this means schematics.

Comments:

I find the mechanics of this bill fascinating, though I’m not sure what type of affect it will have, if any. The Supreme Court has found that offering only a collection of movies to theaters violates antitrust laws. Loews, Inc. v. U.S., 334 U.S. 131 (1948) (“The antitrust laws do not permit a compounding of the statutorily conferred monopoly.”) That is, an intellectual property rightsholder is not insulated from claims targeting anticompetitive behavior just because they Copyright or Patent Acts grant owners exclusive rights. So, there does not appear to be an immediate preemption issue.

The requirement that car companies make information available to aftermarket tool companies is also interesting. One wonders if there will be many copyright suits brought targeting potentially infringing goods that were manufactured from car company specs. We may end up seeing a lot of cases on whether a specific part is a useful article that does not merit copyright protection.
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copyright attorneys

CCC podcast interview with Patry about Moral Panics

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Filed under News

Copyright Clearance Center has released a podcast interview of William Patry on his book Moral Panics and the Copyright Wars. An excerpt of the interview, conducted by Chris Kenneally:

[T]he term copyright wars is a common one and I didn’t coin it. There are many people who use it on either side of the debates. For example, Edgar Bronfman Jr., who is the CEO of Warner Music, in a speech in Singapore said that the copyright owners had gone to war with consumers and as a result, they believe they lost that war. So it’s a common term and I think what is meant by that is a more widespread debate about issues rather than any particular case. You could complain about what a particular company is doing and that wouldn’t be a war, but if it’s a more sociological thing, if it’s a more societal thing, that’s what a war means. Now I think wars change things. Before a war, there’s the world as it is, status quo, and then there’s status quo ante. We’re moving into a status quo ante, aren’t we? With regard to copyright.

Transcript and video of the confirmation hearing for IP-Czar nominee Espinel

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Filed under IP Czar, News

The Senate Judiciary Committee held a hearing today on the nomination of Victoria Espinel for the position of Intellectual Property Enforcement Coordinator. I have included video and a transcript of the hearing below.


[Hearing to consider pending nomination Part II begins, after introductions, at around 94:00]

Leahy (D-VT) [100:30:] If you were confirmed as the Intellectual Property Enforcement Coordinator, or IPEC, would you be willing to appear before the Committee and testify?

Espinel: Yes I would. As you know so well, this role was created and defined by legislation and this position is fully accountable to Congress. Among the duties that I would have if I were confirmed would be to submit an annual report to Congress that would report on the activities of the interagency committees that I would chair. If I am confirmed I look forward to working closely with this Committee, and ensuring that you receive information that is both timely and useful.

Leahy (D-VT) [102:30]: Is there anything that you would like to add to [the record]?

Espinel: I would say that I would like to thank the President. I would very much like to thank you Mr. Chairman Leahy and the members of the Committee. I am greatly humbled to be here and I would like to thank you for your leadership in creating this position and supporting the intellectual property that supports our country.

Feingold (D-WI) [121:10] Ms. Espinel, your prepared testimony is certainly a strong statement about the importance of enforcing intellectual property rights, and no one could really argue with that. You speak convincingly about the coordination among the various agencies that is needed to ensure the enforcement and protection are done efficiently. Can you give me an idea of what steps you will take to make sure that these enforcement activities do not undermine public
access to information that is so crucial for innovation and other priorities of the United States; and specifically, do you see it as part of your portfolio to coordinate with science and information library agencies on this issue?

Espinel: Thank you Senator. I think it’s part of this position to coordinate and find a consensus among all the different agencies and offices of the U.S. Government that are charged with protecting and enforcing intellectual property, and place importance on intellectual property.

I think intellectual property is a long-term strategy in many ways so that there will always be issues, as with all policy areas, where there will have to be balances found. One of the things that I think this position is poised to do is try to work with in a very open and transparent way all of the agencies and all of the stakeholders and the general public of the United States to try to develop a strategy that will protect intellectual property efficiently and effectively, but will do that taking into account the variety of views and opinions that exist.

Feingold (D-WI) [123:30]: So do you agree that overzealous enforcement of intellectual property rights could reduce our citizens’ legitimate access to information? And will you ensure transparency in policy development so that all of the ramifications of these enforcement activities can be accessed with the maximum public involvement?

Espinel: This Administration is very committed to transparency. If I am confirmed by the Senate, I will uphold that policy of transparency and take it very seriously. And I will look for the appropriate forum to do so within the office that I will head.

Franken (D-MN) [1:23:10]: The FCC recently put out a proposal for a more free and open internet. Net neutrality rules. I think what they’re doing is critically important. When Justice Sotomayor was in her hearings I raised this issue as a Constitutional issue of making sure that information flows freely on the internet. Ms. Espinel, I also want to prevent piracy, and you’ve talked about balance. So speaking of balancing, how should regulations balance the need to stop piracy with the need to protect the free flow of information on the internet?

Espinel: Thank you Senator. I think that is an excellent and very important question these days. Clearly internet piracy is a very serious problem our country is facing, and has serious ramifications for our economy. At the same time, openness on the internet is one of the reasons that the internet has been so successful and helpful to so many over the past few decades.

Openness however doesn’t apply to unlawful content. I believe there is way to ensure that the internet is open and we’re not restricting access to legitimate information to people, while trying to contain the very serious problem of internet piracy that we face. As you mention, the FCC is looking at this at this moment. If I were confirmed I would certainly be working with the FCC as well as the other relevant agencies to try to develop a strategy that would efficiently protect and try to stop internet piracy. But one that is consistent with this Administration’s policy of transparency and trying to ensure that we promote the internet.

Franken (D-MN) [125:40]: What do you see as some of the main tensions there? I would just like to get your thoughts on that because there’re all kinds of issues of maintaining your network — people trying to download enormous files — versus the free flow and no restrictions . . . What do you see as the tensions? Net neutrality and this whole issue of intellectual property?

Espinel: I don’t know that there necessarily have to be those tensions. I know that exist, but it seems to me that there has to be a way that we can find to move forward where we can ensure that the internet is open, ensure that there is reasonable management of networks, and at the same time, try to ensure that the internet is not being used as a means of distribution for all types of illegal content, including pirated content.

If I was confirmed, one of the issues that I would be grappling with in coordination with the other agencies is how we go forward in devising a strategy that accomplishes both of those goals.

copyright attorneys

Friday copyright fun: The Downfall meme becomes copyright self aware

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Filed under News

You could argue about the merits of the subtitles . . . Or you could just marvel at copyright law’s ability to inspire dorkiness. (H/t Ron Coleman.)

copyright attorneys

NPR targets same-sex marriage campaign with a cease-and-desist and take down

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Filed under DMCA, News

The Portland Press Herald brings word of a brewing copyright dispute. National Public Radio has sent a cease-and-desist to Stand for Marriage Maine over the groups use of NPR content in one of its television adds. NPR, apparently, also sent a takedown notice to Youtube and Hotdaddy.

NPR asserts that Marriage in Maine’s commercial infringes a story “Massachsuetts Schools Grapple with Including Gay & Lesbian Relationships in Sex Education,” from its program All Things Considered. Says NPR’s senior vice president for marketing, communications, and external relations:

NPR did not license use of this story or its content, and would certainly not have licensed or permitted it if we had been asked . . .NPR is a highly respected news organization and does not allow its content to be used by political or advocacy groups. Such use is harmful to the integrity and independence of NPR. NPR does allow – even encourage — personal, non-commercial use of our content, so long as it is not modified, and not used in a manner that suggests NPR promotes or endorses a cause, idea, Web site, product or service. The use made by Stand for Marriage Maine violated all of these terms.

copyright litigation attorneys

Monday Copyright Roundup

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Filed under Academia, Daily Copyright Roundup, News, Termination

Doug Lichtman has released a new podcast in his IP Colloquium series. The details:

Title: Can Content Survive Online?

Guests: Brad Smith (General Counsel, Microsoft); Scott Martin (Executive Vice President, Paramount Pictures); Dan Cooper (Vice President of Business & Legal Affairs, MySpace).

Description: The music, publishing and motion picture industries are each today struggling to identify new business models that might replace existing mechanisms for funding professional content. In this edition of the Intellectual Property Colloquium, we consider the legal and strategic roadblocks that might be standing in the way. Guests include: Brad Smith, General Counsel, Microsoft; Scott Martin, Executive Vice President, Intellectual Property, Paramount Pictures; and Dan Cooper, Vice President, Legal & Business Affairs, MySpace. UCLA law professor Doug Lichtman hosts.

O‘Melveny and Myers attorneys Christopher Murray and Paul Iannicelli have posted an article at Mondaq and their firm’s website on how the Copyright Act’s termination provisions may impact I.P. transactions. A snipit:

Although [Sections 203 and 304 of the]  Copyright Act seem reasonably clear on their face, it is often the case that in actual application they can become quite complicated. As the judge in the Siegel case noted, “The 1976 Copyright Act contains many intricate formalities that an author (or his or her heirs) must navigate to successfully terminate” a grant. As one example, both Sections 203 and 304 provide that a grant can be terminated when the statutory right ripens “notwithstanding any agreement to the contrary,” in order to prevent an unsuspecting author, or one with little leverage, from waiving the right at the time of the grant or before its value can accurately be measured. But what if the author or his heirs have subsequently entered into an agreement with the grantee after the work has been exploited, in a manner that takes into account the demonstrated value of the work? Should those be considered “agreements to the contrary” that have no bearing on the validity of the termination right? Or should they be upheld as waiving the termination right, on the basis that they have effectively fulfilled the public policy of providing the author or his heirs the chance to re-negotiate from a position of knowledge and possibly strength?

Robin S. Lee, an Assistant Professor of Economics at the Stern School of Business, New York University, and Tim Wu, Professor of Law at Columbia University Law School have posted a new article at SSRN titled Subsidizing Creativity Through Network Design: Zero Pricing and Net Neutrality. The abstract:

Today, through historical practice, there exists a de facto ban on termination fees – also referred to as a “zero-price” rule (Hemphill, 2008) – which forbids an Internet service provider from charging an additional fee to a content provider who wishes to reach that ISP’s customers. The question is whether this zero-pricing structure should be preserved, or whether carriers should be allowed to charge termination fees and engage in other practices that have the effect of requiring payment to reach users. This paper begins with a defense of the de facto zero-price rule currently in existence. We point out that the Internet, as an intermediary between users and content providers, exhibits pricing dynamics similar to other intermediaries in “two-sided markets.” In particular, we posit that the Internet’s absence of payments from content creators to users’ ISPs facilitates the entry of content creators. In that respect, the rule provides an alternative implementation of the policy goals provided by the intellectual property system and achieves functions similar to copyright and patent law. The rule also helps avoid the problems of Internet fragmentation, in which content providers who do not reach agreements with ISPs cannot access all customers, and consumers on a single ISP are foreclosed from processing their content.

copyright attorneys

BrightTalk IP Litigation Summit tomorrow

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Filed under News

BrightTalk is hosting an IP Litigation Summit tomorrow afternoon.  You can register for the streaming presentations free of charge at: http://www.brighttalk.com/summit/iplitigation:

  • “Appealing Beyond the Supreme Court: Patent Reform Legislation”

Jon W. Dudas, Partner at Foley & Lardner LLP and Former Director of the United States Patent & Trademark Office

  • “Abusive Domain Names: Enforcement Options & ICANN Policy Update”

Mike Rodenbaugh, Principal Attorney at Rodenbaugh Law

  • “Preventing Licensing Discussions from Escalating to Litigation”

Anthony Sebro, Partner at PCT Companies

  • “Developing a Winning IP Litigation Strategy in Challenging Times”

Thomas Fleming, Partner at Kaye Scholar LLP

  • “Six Steps for Managing IP Litigation Costs”

R. David Donoghue, Partner at Holland and Knight [Ed: Of the Chicago IP Litigation Blog]

  • “Does the Sun Shine on Inventive Process? In re Bilski, S.Ct.2009

Mike Molano, Partner at Sheppard, Mullin, Richter & Hampton LLP

copyright litigation attorneys

Copyright at the Supreme Court this week

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Filed under Academia, Complete Preemption, Importation, Jurisdiction, News, Registration, Supreme Court

This is big week for copyright at the Supreme Court. The Court will hear oral arguments in the twenty-year legal saga Reed Elsevier v. Muchnick on Wednesday. On that note, Emily M. Bass, the attorney who represented one of the two plaintiff groups in Tasini, has passed along word about an article she has posted at SSRN. The abstract:

‘Catch 411:’ Does Section 411 of the Copyright Act Restrict the Subject Matter Jurisdiction of Federal Courts Over Copyright Actions?

This commentary examines an issue that will soon be argued before the United States Supreme Court: whether 17 U.S.C. §411′s registration requirement restricts the subject matter jurisdiction of the federal courts over copyright infringement actions. The Second Circuit found that courts lack jurisdiction to adjudicate claims alleging the infringement of unregistered works. The issue of whether courts have jurisdiction over such claims is of tremendous importance: The U.S.’s collective intellectual product is perhaps its greatest asset. Since unregistered works are as susceptible to mass electronic infringement as registered works, and arguably much more numerous, a decision affirming the Second Circuit would deny the country effective means of defending key IP. This commentary examines the statutes involved, arguments that have been made and the Second Circuit Opinion. It poses four solutions to §411′s supposed jurisdictional conundrum and concludes that federal courts unquestionably possess jurisdiction over unregistered claims.

I will post a longer writeup tomorrow that I have been sitting on for the last couple of months. The post will look at how complete preemption should color our view on whether registration is a jurisdictional requirement. I know what all of you (or at least six of you) are thinking: the only way to kick a discussion of obscure jurisdictional issues up to eleven is to talk about complete preemption. It’s like adding bacon.

Today may be the day we hear whether the Supreme Court will grant cert in Omega SA et al v. Costco Wholesale Corporation. The Supreme Court has in the past released cert decisions for cases they consider during their fall long conference on the following Monday. The appeal was scheduled for conference on September 29, so that would put today as the date we would be likely to hear.

Costco filed a supplemental brief on September 28 (that addressed the S.D.N.Y.’s September 25 decision in Pearson Education, Inc. v. Ganghua) so the cert decision could be delayed.

copyright litigation attorneys

China IP Law Search website launched

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Filed under News

The Chinese Ministry of Commerce, the Delegation of the European Commission to China and academics from Peking University have launched a new website that provides English language translations of the regulations, procedure and substantive law that govern intellectual property in China.  The site describes itself thus:

China IP Law Search intends to provide users with access all laws relevant for IP protection in China. It aims to be a valuable source of information for companies, professionals and students working, studying or simply interested in the Chinese legal IP environment. Use this tool to search the China IP Law database based on bibliographic infromation or perform a full text search of all published texts.

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