Case Comments
| Publication year | 2019 |
| Author | Lowell Anderson |
Lowell Anderson
Stetina Brunda Garred & Brucker
"[P]arties may agree to have an arbitrator decide not only the merits of a particular dispute but also ''gateway'' question of arbitrability,' such as whether the parties have agreed to arbitrate or whether their agreement covers a particular controversy.'" But if the demand for arbitration is "wholly groundless" some courts have taken it upon themselves to decide the gateway question of arbitrability to enable courts to block frivolous attempts to transfer disputes from the court system to arbitration." Interpreting the Federal Arbitration Act as written, "[w]hen the parties' contract delegates the arbitrability question to an arbitrator, a court may not override the contract." The court may decide whether the agreement delegates the arbitrability question to an arbitrator. A decision denying arbitration was vacated and remanded. Henry Schein, Inc. v. Archer & White Sales, Inc., 139 S.Ct. 524, 202 L.Ed.2d 480 (2019).
A digital sound recording stored in a medium at the time of purchase, may be "distributed" to others under the first sale doctrine - but apparently only in the specific medium containing the sound recording at the time of purchase. Transferring the "digital" recording to another electronic device or storage medium creates a new "phonorecord" under the broad definition of phonorecord in 17 U.S.C. § 101. The resale right of § 109(a) applies to a "particular...phonorecord...Jawfully made" and creating a new phonorecord is prohibited by § 106(a). The reproduction right is separate from the distribution right and not protected by the first sale doctrine. Transferring a new phonorecord in the form of a digital copy to a third party is not a fair use because it transfers the entire work, without any transformation, in direct competition with the author's sale of identical quality "digital" sound recordings. The Second Circuit thus affirmed a summary judgment of infringement and an injunction against a party using software that deleted the digital sound recording from one media while simultaneously transferring it to another media for resale to third parties, because each digital transfer created a new, unauthorized copy. While the original buyer likely makes multiple digital copies in transferring the digital recording to other storage media or in playing the sound recording on various devices, potential liability for those acts was not discussed. Capitol Records, LLC v. ReDigi, Inc., 910 F.3d 649, 128 U.S.P.Q.2d 1793 (2d Cir. 2018).
Representations that Plaintiff was seeking statutory damages for willful infringement in his Rule 26(f) plan and reiterated elsewhere before and during trial established an election of statutory damages-even though Plaintiff presented evidence at trial that was relevant to lost profits. An award of $30,000 statutory damages for sampling the first 12 bars of "Looking for a country Girl" in the song "Hell 2 Da Naw Naw" was affirmed. Smith v. Thomas, 911 F.3d 378, 129 U.S.P.Q.2d 1079 (6th Cir. 2018).
"Simply put, inferring the person who pays the cable bill illegally downloaded a specific file is even less trustworthy than inferring they watched a specific TV show." But it may be enough to force an ISP to identify the subscriber, leading to a lawsuit in which only those who do not fight, the low hanging fruit, are pursued while those who fight are dismissed. "Because Strike 3's need for discovery does not outweigh defendant's privacy expectation, the Court will deny Strike 3's ex parte motion to subpoena defendant's ISP to discovery defendant's identity prior to the 26(f) conference. That sunders Strike 3's entire case, since a failure to identify defendant makes effectuating service impossible." The Court dismissed the case without prejudice." Strike 3 Holdings, LLC v. John Doe Subscriber, 908 F.3d 1301, 128 U.S.P.Q.2d 1602 (D.C. D.C. 2018).
Two photographers entered agreements with Corbis allowing Corbis to license their photos to others, with the agreement having a New York forum selection clause. Corbis entered an agreement with McGraw-Hill regarding use of the photos, the agreement having a New
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York selection clause. Each of the two photographers sued McGraw Hill in a different forum with one court binding the photographer to the Corbis-McGraw-Hill forum selection clause, and the other not binding the photographer. Both cases were consolidated, as were the mandamus petitions. The photographers did not sign the McGraw-Hill agreement and were not third-party beneficiaries of that agreement even though their names were on invoices with McGraw-Hill-because the photographers received money only because of the separate agreement with Corbis. The photographers were thus not bound by the forum selection clause in the McGraw-Hill-Corbis agreement. While the forum selection clause was not binding on the photographers so that one court transferred the case erroneously, the mistake was neither clear nor indisputable so mandamus was denied. Numerous forum selection issues were discussed, but the end result treated the two photographers differently, as noted by the dissent. In re McGraw-Hill Glob. Educ. Holdings LLC, 909 F.3d 48, 128 U.S.P.Q.2d 1669 (3d Cir. 2018).
The Official Code of Georgia Annotated (OCGA) are authored by or under the authority of the Georgia General Assembly. A Georgia government commission contracted with LEXIS to publish an unannotated online version for public access, to update the OCGA annually under the commission's supervision and to set the LEXIS price for annotated copies, but with Georgia owning the copyright. The Public Resource Organization (PRO) purchased print copies of 186 volumes of the OCGA, scanned them and posted them online. A trial court found copyright infringement and enjoined further publication by PRO. The appeals court found the OCGA were "legislative works created by Georgia's legislators in the exercise of their legislative authority." The annotations, "while not having the force of law, are part and parcel of the law" and are law-like as to who made them and the role they play in the legislative and jurisprudential spheres of public life, so they represent a work "that is constructively authored by the People" and is uncopyrightable. The finding of copyright infringement was reversed, judgment was entered for defendant PRO and the injunction was vacated. Code Revision Comm'n v. Pub. Res.Org., Inc., 906 F.3d 1229, 128 U.S.P.Q.2d 1339 (11th Cir. 2018).
While 17 U.S.C. § 411(a)'s registration requirement is a precondition to filing a claim, it does not restrict a federal court's subject matter jurisdiction. "thus, while a [DJ] complaint claiming infringement of an unregistered copyright can be dismissed for failure to state a claim, it cannot be dismissed for lack of jurisdiction." The court erred in dismissing the complaint for lack of federal question jurisdiction. Under diversity jurisdiction, the amount in controversy is the monetary value of the object of the litigation from the plaintiff's perspective. Accessing a government website and violating the terms of use restricting the copying of Georgia statutes imposed $20,000 liquidated damages for each violation, and that "potential liability" satisfied the $75,000 amount in controversy. Fastcase, Inc. v. Lawriter, LLC, 907 F.3d 1335, 128 U.S.P.Q.2d 1463 (11th Cir. 2018).
Plaintiff took photos of President Trump at a wedding and after embedding plaintiff's name in the image, texted it to a third-party guest who sent it to someone who posted it online. The photo then appeared on the Esquire magazine website and in other publications, without plaintiff's permission or accreditation. Plaintiff promptly registered the copyright in the photo and sued Esquire (owned by Hearst). Ownership and copying were undisputed. Commercial use of a personal photo was not a transformative fair use; the photo was used in the same context it was taken, in a factual article about a wedding with most of the facts gleaned from the photo itself. Publication of a factual photo favored fair use, but substantially the entire photo was used which went against fair use. "The creator of a work should not be precluded from future profits should they lack the marketing prowess to capitalize on their work at the time of creation" and published [sic publication of] the photo without permission destroyed the primary market for the photo. "Allowing a news publisher to poach an image from an individual's social media account for an article that does little more than describe the setting of the image does not promote 'the Progress of science and useful Arts.'" Summary judgment of infringement and no fair use were granted. Otto v. Hearst Commc'ns, Inc., 129 U.S.P.Q.2d 1056 (S.D.N.Y. 2018).
On Oct. 11, 2018, Congress enacted Pub. L. No. 115-264 (Music Modernization Act or "MMA") which precludes copyright protection for pre-1972 sound recordings until after 2067 under 17 U.S.C. § 301(c) with new section § 1401(e) preempting state law claims for digital transmissions of pre-1972 sound recordings that occurred after the effective date of the MMA, and preempting any common law copyright arising from a digital audio transmission or reproduction made before the MMA of a sound recording fixed before Feb. 15, 1972 if compulsory licensing and other criteria were met. That statutory change resulted in an order denying en banc rehearing by the Ninth Circuit of ABS Entm't v. CBS Corp., 900 F.3d 1113, 127 U.S.P.Q.2d 1646 (9th Cir. 2018) but with the order amending that decision to remove Section V of that opinion discussing "for guidance" the state derivative work copyright rights in pre-1972 sound recordings. Thus, the district court could address the impact...
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