Posts in Copyright Litigation

As of today, the 2022 Supreme Court docket is light on intellectual property cases, with the Court having granted review of only one copyright case. However, one other major case lurks in the background on an issue—patent ineligibility—upon which the Supreme Court has already demonstrated its interest. These two cases are examined in greater detail below.

One of the greatest attributes of copyright law is the never-ending abundance of exciting new developments, including those in Congress, the courts, and at the Copyright Office. On the surface, copyright seems straightforward in that it advances the public good by securing property rights to authors. But underneath this simple veneer lies centuries of debate about how best to balance the rights of authors with the public interest, where each distinct issue presents a veritable rabbit hole of metaphysical distinctions. For the copyright connoisseur, keeping up with the latest events can be an exhausting endeavor, though the thrill of solving new puzzles makes it intellectually rewarding. Thankfully, one need not be a member of the copyright cognoscenti to appreciate the major developments in copyright law this past year. From the Supreme Court’s decision in Google v. Oracle to the implementation of a small copyright claims tribunal to attempts to rein in state infringements, 2021 has certainly provided many wonderful events worth highlighting.

The Andy Warhol Foundation has petitioned the U.S. Supreme Court, asking it to review a decision of the U.S. Court of Appeals for the Second Circuit holding  that Andy Warhol’s Prince Series did not constitute fair use of Lynn Goldsmith’s photograph. The Second Circuit held in March that “the district court erred in its assessment and application of the fair-use factors and the works in question do not qualify as fair use.” The Court of Appeals further concluded that the Prince Series works were substantially similar to the Goldsmith Photograph “as a matter of law.” The Supreme Court petition argues that “the Second Circuit’s decision…creates a circuit split and casts a cloud of legal uncertainty over an entire genre of visual art.”

On November 15, Houston-area aerial photographer Jim Olive Photography filed a petition for writ of certiorari asking the U.S. Supreme Court to take up an appeal from the Texas Supreme Court, which had denied Olive’s copyright claims against the University of Houston System on sovereign immunity grounds. In the petition, Olive requests that the Supreme Court simply grant certiorari, vacate the lower decision and remand for reconsideration of the issues in light of the Court’s decision this summer in Cedar Point Nursery v. Hassid, which was issued just a few days after the Texas Supreme Court ruled against Olive.

“Fair Use” is a flexible defense to claims of copyright infringement. It is a doctrine that evolves as technology and the way in which people use copyrighted works advance. As an exception to the general law prohibiting copying others’ works, it permits copying for a limited and “transformative” purpose, such as commentary, criticism, teaching, news reporting, scholarship, or research. Naturally, the way courts analyze the “fair use” defense must adapt as technology advances and the way in which creative content is developed evolves. Earlier this year, for example, the U.S. Supreme Court ruled on a landmark fair use case involving the “copying” of an Application Programming Interface (API).

One recurring thorn in the side of copyright owners is Cloudflare, the San Francisco-based web performance, optimization, and security company. Cloudflare offers many services to its customers, including a content delivery network that utilizes hundreds of servers around the world to cache its customers’ content. When an end user requests content from one of Cloudflare’s customers, it is delivered to that user from the cached copy on the nearest Cloudflare server—not the customer’s own web host server. This saves on bandwidth costs, improves security, and decreases page load times. It also raises important questions about Cloudflare’s liability for contributory copyright infringement when it knowingly allows infringing content to remain on its cache servers. Under Ninth Circuit precedent, web hosting services like Cloudflare can be held contributorily liable for assisting in the infringement under the material contribution theory. However, a recent district court decision misconstrued the case law to conclude otherwise in Mon Cheri v. Cloudflare.

The U.S. Supreme Court heard oral argument today in Unicolors v. H&M. The case asks the Court to decide whether the Ninth Circuit properly construed the language of 17 U.S.C. § 411 relating to whether courts must have evidence of intent to defraud before referring copyright registration validity questions to the Copyright Office. While the questioning seemed to favor Unicolors overall, at least one Justice today asked why a change in the question presented at the merits stage of the briefing shouldn’t result in the case being dismissed as having been “improvidently granted.”

The U.S. Supreme Court today granted a motion made by the Acting U.S. Solicitor General to participate in oral argument as an amicus in the case of Unicolors v. H&M. The case asks the Court to decide whether the Ninth Circuit properly construed the language of 17 U.S.C. § 411 relating to whether courts must have evidence of intent to defraud before referring copyright registration validity questions to the Copyright Office. Oral argument is set for November 7.

On September 30, the U.S. Court of Appeals for the Second Circuit issued a ruling in Horror Inc. v. Miller in which the appellate court affirmed a summary judgment ruling in the District of Connecticut which found that Victor Miller was an independent contractor when writing the script for the 1980 classic horror film Friday the 13th. The ruling enables Miller to move forward with copyright termination notices served on Horror, which became the successor-in-interest to the rights to Friday the 13th, so that Miller can claim copyright in the original screenplay.

On September 27, the National Music Publishers’ Association (NMPA) and online game platform provider Roblox announced that the two parties had settled ongoing copyright litigation in the Central District of California over Roblox’s unauthorized use of copyrighted music on its online gaming platform. The settlement also creates an opt-in mechanism for eligible NMPA publishers and opens a negotiation period for individual publishers to engage Roblox in go-forward licensing deals.

On September 22, publishing company Canada Hockey L.L.C., doing business as Epic Sports, and Michael Bynum, a sportswriter and editor, filed a petition for rehearing en banc in their appeal of a copyright case against both Texas A&M University and a pair of school officials. In their petition, the plaintiffs argue that the original panel decision erred in failing to find constitutional violations of both the Fifth Amendment’s Takings Clause and due process under the Fourteenth Amendment for Texas A&M’s unlawful reproduction of the plaintiffs’ copyrighted work regarding the history of the legendary 12th Man at Texas A&M.

Yesterday at IPWatchdog LIVE, a morning panel discussed “The Impact of Google v. Oracle on Fair Use.” That decision of the U.S. Supreme Court, issued this April, has many ramifications for the future of copyrightability of computer code as well as the analysis of transformative uses of computer code. Speaking on the panel was Chad Rutkowski, Partner at Baker & Hostetler LLP; Van Lindberg, Partner at Taylor English and Counsel and Director of the Python Software Foundation; and Llewellyn Gibbons, Distinguished University Professor, University of Toledo College of Law.

On August 31, at the request of Senators Thom Tillis (R-NC) and Patrick Leahy (D-VT), the United States Patent and Trademark Office (USTPO) provided a report to Congress analyzing infringement disputes between patent and trademark rights holders and states and state entities. The U.S. Copyright Office produced a similar, much lengthier report, also in response to a letter from Tillis and Leahy, studying whether there is sufficient basis for federal legislation abrogating State sovereign immunity when States infringe copyrights. The Senators’ letters were prompted by the March 2020 Allen v. Cooper Supreme Court decision. While the USPTO report came to no conclusions, the Copyright Office found that “the evidence indicates that state infringement constitutes a legitimate concern for copyright owners.”

The U.S. Court of Appeals for the Ninth Circuit on Monday ruled that California common law on copyright protection does not include a right of public performance, reversing a partial summary judgment for Flo & Eddie, which controls the rights to the songs of the rock band the Turtles. The case began in 2013, when Flo & Eddie sued Sirius XM Radio, Inc. for playing the Turtles’ iconic pre-1972 recordings, such as “Happy Together” and “Elenore.” While AM/FM radio stations do not pay public performance royalties to sound recording owners, digital and satellite radio providers like Sirius XM must pay public performance royalties whenever they broadcast post-1972 music.

SAS Institute is a software company in North Carolina. Founded in 1976, it employs thousands of people in the United States and thousands more around the world. World Programming, Ltd. (WPL) is a British company that decided to build a clone of SAS’s popular analytics software and, as several courts have found, broke the law to do it. After a decade of litigation across two continents and an unpaid multi-million-dollar judgment, the parties are once again in court. This time, however, WPL’s arguments pose grave dangers to all owners of other copyrighted works. WPL did not try to compete with SAS by building a different or better product. Instead, it ordered copies of SAS’s products under the guise of an educational license, but with the true intent to reverse-engineer and copy key elements, including the selection and arrangement of its outputs, and even the manuals licensed users receive from SAS. The result is that WPL produced a clone, taking the exact same input and producing the exact same output that SAS does. Avoiding the years of investment and fine-tuning that SAS undertook to create its market-leading software, WPL undercut SAS’s price in the market and lured away SAS’s customers.