Property, intangible

a blog about ownership of intellectual property rights and its licensing

  • Google is, Irrelevantly, Confirmed as the Senior User of the ANDROID Mark

    Artwork by Bersam under CC-BY 3.0 unported, click for source
    Artwork by Bersam, CC-BY 3.0 unported

    Before Google acquired Android, Inc., and later released the Android operating system, Erich Specht had registered the mark ANDROID DATA. Specht claimed Google infringed his trademark; Google was successful in the trial court with a claim that Specht had abandoned the trademark, as I previously blogged.

    The Court of Appeals for the Seventh Circuit now upholds the trial court. There’s nothing particularly notable about the decision; the appeals court simply agrees that Specht’s cessation of use when he shut down his business was an abandonment, and that a few intermittent efforts at use after that weren’t enough to maintain his trademark rights.

    There were a few arguments that didn’t go anywhere. Specht argued that “Google released its operating system without retaining control over how developers or mobile-phone companies like T-Mobile could use the software, giving them a so-called ‘naked license.’” I’m not sure why Google’s rights was an issue at all; as far as I can tell Google never alleged Specht infringed so it shouldn’t matter whether or when Google established its own trademark rights. I guess it mattered because Specht had some more substantial use after Google adopted its ANDROID mark that might have carried the day, but that wasn’t really explained.

    So the court addresses the naked licensing argument but dismisses it. First, Specht raised it for the first time on appeal so the argument was waived. I don’t really follow the next reasons though, so I’ll just quote the opinion for you:

    Second, because a naked licensor abandons an already-owned mark, Specht’s argument presupposes that Google had an enforceable right to the Android mark, a position that undercuts Specht’s claim to be the holder of that right. [No it doesn’t, they could both have rights. Ed.] Third, an argument about naked licensing is an argument about Google’s rights against licensees, and licensees are not an issue in this case. [So what would you call the developers using the software? Ed.]

    As much as I am not a fan of the naked license doctrine, and don’t believe that the Android mark is nakedly licensed, if you’re going to address a theory it should be a well-considered response. “Irrelevant” and “not raised, therefore waived” would have been good enough to dispose of the point, rather than these random statements made without the benefit of full fact-finding and argument (which is why you can’t raise new issues on appeal).

    The court cited the wrong statutory section as its authority to cancel the Specht registration; that argument didn’t go anywhere. And costs go to the prevailing party whether the judgment says so or not.

    Specht v. Google Inc., No. 11-3317 (7th Cir. April 4, 2014).

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    , , , ,

  • Never Use the Words “Intellectual Property” When It Matters

    “Intellectual property” is a meaningless phrase when it comes to a description of legal rights. It it is catch-all term for at least three different types of intangible property: patent, trademark and copyright, and maybe boat hull designs, and maybe Indian tribal names, and maybe trade secrets, and maybe the right of publicity—you get the picture.

    Patent and copyright arise under Article I, Section 8, Clause 8, of the Constitution, the Copyright and Patent Clause, and are solely creatures of federal law. Federal trademark rights arise under Article I, Section 8, Clause 3 of the Constitution, the Commerce Clause, but the individual states also regulate trademarks. The Copyright Office is a legislative branch, Article I, function under the Librarian of Congress but the Patent and Trademark Office is an executive branch, Article II, function. The federal laws that defines patent, copyright and trademark are codified and classified in different parts of the United States Code—Title 15 for trademark, Title 17 for copyright, and Title 35 for patents. So you see, when it comes down to brass tacks, even the three types of “intellectual property” rights that federal law defines have very little in common.

    Nevertheless we loosely refer to “intellectual property” rights, which is fine for situations where a loosey-goosey term is good enough, like job titles. But—please—never, ever use the term in an agreement or you could find yourself in court for a long time.

    Defendant Lief Hauge worked for plaintiff Energy Recovery, Inc. (“ERI”) and they had a falling out. They settled a lawsuit by agreement and the agreement was adopted in a 2001 Order. As related by the court, the agreement said:

    ABSOLUTE TRANSFER OF ALL RIGHTS IN PATENTS, PATENT APPLICATIONS AND ALL RELATED INTELLECTUAL PROPERTY, TO ENERGY RECOVERY.

    [Hauge] irrevocably and absolutely assign[s] … all right, title and interest along with any and all patent rights [which Hauge had in] (i) the patents and patent applications …; (ii) any and all patent rights …, intellectual property rights, property rights …; and (iv) all other intellectual property and other rights relating to pressure exchanger technology predating this Order.

    Hauge also agreed not to compete for two years.

    After the two years was up, Hauge filed a provisional patent application for a “Pressure Exchanger” and ultimately a patent issued from it. Hauge then went into business competing with ERI on pressure exchangers. ERI filed a Motion for Order to Show Cause claiming that Hauge had violated the 2001 court order, claiming that, by the terms of the agreement, it owned Hauge’s post-settlement invention under subparagraph (iv).

    The district court agreed with ERI, saying that allowing Hauge “to … develop new products using the very technology he assigned to ERI solely because those new inventions post-date the Agreement would render the Settlement Agreement and its assignment of ownership rights useless.” Hauge was found in contempt of the 2001 Order and appealed.

    But Hague was right; he wasn’t in contempt. The parties agreed that the contempt motion was not about patent infringement; that was the subject for another day. But that left nothing for ERI to complain about:

    Mr. Hauge’s manufacture of the PR pressure exchanger is not inconsistent with the 2001 Order’s requirement that Mr. Hauge transfer all “intellectual property and other rights relating to pressure exchanger technology pre-dating this Agreement.” Civil contempt is an appropriate sanction only if the district court can point to an order of the court which “sets forth in specific detail an unequivocal command which a party has violated.” ERI cannot point to such a command. Mr. Hauge is not claiming ownership of ERI’s intellectual property. Nor did Mr. Hauge start selling pressure exchanger products before the expiration of the Agreement’s non-compete clause. Finally, if in fact Mr. Hague is using ERI’s manufacturing processes, he may be violation of the patent laws or state trade secret laws, but he is not in violation of any “unequivocal command” in the 2001 Order.

    Within a few days, a Delaware state court reached the same conclusion:

    Unfortunately, the references to intellectual property in the complaint, various other submissions of both Spiro and Vions, and the key underlying documents are loose and imprecise. As a result, the arguments of the parties are often vague, confusing, and unhelpful. This problem is not unique to this case as demonstrated by a recent decision by the United States Court of Appeals for the Federal Circuit, Energy Recovery, Inc. v. Hauge, in which the appellate court was called upon to resolve the question of “what is intellectual property” within the meaning of the agreement at issue in that case.6

    6 Energy Recovery, Inc. v. Hauge, 2014 WL 1063442 (Fed.Cir. Mar. 20, 2014). Under the approach adopted by the Federal Circuit in the Hauge case, “intellectual property” is not treated as the technology itself, but the rights over that technology. See id. at *4. Although the decision in the Hauge case is by no means controlling in the context of this action, the approach taken there is useful here, as well, and comports with what appears to be the intent of the parties involved in this dispute.

    The lesson: there are no rights in “intellectual property.” One may have patent rights, copyright rights, or trade secret rights, or claims for tortious interference, or for breach of a contractual obligation not to use “know how,” or fraud. But there’s no such thing as owning, or infringing, “intellectual property.”

    Energy Recovery, Inc. v. Hauge, No. 2013-1515 (Fed. Cir. March 20, 2014).

    Spiro v. Vions Technology, Inc., C.A. No. 8287-VCP (Del Ch. Mar. 24, 2014) (unpublished).

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    ,

  • You Are Not the Only One Confused by the Law of Patent Standing

    Here are the musings of a bewildered district court judge trying to figure out the difference between a patent owner, an exclusive licensee, and a “de facto” patent owner. The patent owner, a professor named Morris, had exclusively licensed just about everything to plaintiff BRK and the court had to figure out if BRK had standing:

    I confess that I don’t understand the Federal Circuit’s position. As a district judge pro tem., mine not to reason why, mine but to do and die, into the valley of death, etc. Still, I am uncomfortable enforcing rules that I don’t understand the basis of. As exclusive licensee, BRK has much to lose from infringement—doubtless a great deal more than Morris, for BRK has built an entire business around its exclusive right to sell the patented products. True, BRK is not the patentee, and 35 U.S.C. § 281 says only that “a patentee shall have remedy by civil action for infringement of his patent.” But since “patentee” has been stretched by the Federal Circuit to embrace a transferee of all substantial rights, why can’t it be stretched an inch farther to include the exclusive licensee, who is after all the only entity that actually practices the patent? And since Morris has surrendered all control over this lawsuit, his participation in it has no significance; why then should he have to be joined? What is one to make of such a statement as “a licensee may obtain sufficient rights in the patent to be entitled to seek relief from infringement, but to do so, it ordinarily must join the patent owner,” Abbott Laboratories v. Diamedix Corp., 47 F.3d 1128, 1131 (Fed.Cir.1995) (emphasis added)?

    Well, maybe not so bewildered as he makes out—it is eminent jurist Richard Posner, sitting by designation in the trial court.

    Maybe BRK is right and Morris is no longer the owner, BRK having acquired “all substantial rights,” in Federal Circuit-speak. Aspex Eyewear, Inc. v. Miracle Optics, Inc., 434 F.3d 1336, 1340 (Fed.Cir.2006). (And what by the way are “insubstantial rights”?) But these are just words. Morris is the inventor and the licensor, BRK the exclusive licensee, producer, and seller. Why should Morris have to be dragged into the suit? It used to be thought that without such joinder an alleged infringer would be subject to duplicative suits. Independent Wireless Telegraph Co. v. Radio Corp. of America, 269 U.S. 459, 468, 46 S.Ct. 166, 70 L.Ed. 357 (1926). Not so, at least under modern law, since the (nominal) patentee and the exclusive licensee would be in privity and so subject to collateral estoppel. The Federal Circuit has expressed a related, and likewise it seems an ephemeral, concern: that the rule is needed to “prevent a party with lesser rights from bringing a lawsuit that may put the licensed patent at risk of being held invalid or unenforceable in an action that did not involve the patentee.” Aspex Eyewear, Inc. v. Miracle Optics, Inc., supra, 434 F.3d at 1343. A patentee who, like Morris, authorizes the exclusive licensee to sue infringers and exercise complete control over the infringement litigation has consciously assumed the risk that the Federal Circuit wants to protect him from; and why should it? Morris is not a baby.
     
    Nest is indifferent, however, to whether BRK is held not to have “all substantial rights,” in which event Morris must be joined under the rule of law that we don’t understand the rationale for, or if not that he should be dismissed. Since he may have to be joined, I’ll leave him in as a coplaintiff. But what a waste of time!

    BRK Brands, Inc. v. Nest Labs, Inc., No 13 C 7900 (March 19, 2014).

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    , , , , ,

  • 9th Circuit Agrees with Copyright Office

    There is a rash of lawsuits brought by photographic agencies against textbook publishers, claiming that the publishers underreported the number of copies of books that were published. The publishers are fighting back and there are two main grounds for attack—that the requirements for registration were not met and that the individual photographers’ assignments to the agency were ineffective.

    In Alaska Stock, LLC v. Houghton Mifflin Harcourt Publishing Co., Houghton Mifflin attacked the practice of group registration of copyright. In any given application, Alaska Stock registered hundreds of photographs taken by dozens of photographers as a compilation work. Alaska Stock listed in the application the name of three, but not all, photographers, and listed the title of the compilation work but not the titles of the individual photographs. The lower court held that the only thing registered was the compilation work itself, not the copyright in the individual photographs, and dismissed the suit.

    The Court of Appeals for the Ninth Circuit has, thankfully, reversed, and for good reason—Alaska Stock had registered the copyrights in exactly the way that the Copyright Office told them to do it:

    In 1995, a trade association of stock agencies, Picture Agency Council of America, Inc., met with the Register of Copyright (the head of the Copyright Office), her Chief Examiner, and other Copyright Office staff, to work out how to register large catalogs of images. The Register agreed that a stock agency could register both a catalog of images and the individual photographs in the catalog in one application if the photographers temporarily transferred their copyrights to the stock agency for the purposes of registration.

    The trade association confirmed this with the Copyright Office in writing, and advised its member stock agencies…. The Copyright Office provided a letter to the trade association telling it how stock photo catalogs ought to be registered. The letter says that listing only three individual photographers by name, followed by the phrase “and x [number] others,” and naming the agency as owner of the copyrights was “acceptable when the accompanying deposit copies are catalogs consisting of photographs.” A copyright examiner would interpret such filings to mean that the claim being registered would include the catalog and “extend also to the photographs themselves.” … Though the office had a “preference” for naming all the authors, the Copyright Office letter says that it is “just that—a preference but not a requirement.”

    The district court had this information, but nevertheless considered the Copyright Office policy inconsistent with the requirements for registration in the Copyright Act. The district court held that the statute required identifying the name of every photographer and the title of every work contained in the compilation.

    The Ninth Circuit disagreed. It found that the requirements for identifying the “author” and “title” was a reference to the author and title of the compilation work, e.g., “Alaska Stock CD catalog 4” as the title and “Alaska Stock, LLC” as the author. Then, “[w]here, as here, the photographers have assigned their ownership of their copyrights in their images to the stock agency, and the stock agency registers the collection, both the collection as a whole and the individual images are registered.” The Second, Third Fourth, Fifth Circuits and Nimmer on Copyright are in accord with this principle.

    Thus, we conclude that Alaska Stock successfully registered the copyright both to its collections and to the individual images contained therein…. The procedure applied for over three decades by the Register of Copyrights to registration by stock photo agencies complied with the statutory requirements and did not violate any clear requirement to list individual authors and titles of the components within the work. While arguably the statute could be read otherwise, the Register of Copyrights’ reading that a collection of stock photos may be registered without individual titles, and without naming more than three of the authors and merely designating the number of authors, pursuant to an assignment in the language Alaska Stock used, was reasonable and persuasive.

    For administrative law fans, while the Copyright Office policies are not entitled to Chevron deference, there is also the principle that “an administrative interpretation upon which private actors have relied aids in construction of a statute precisely because private parties have long relied on it.”

    We are not performing a mere verbal, abstract task when we construe the Copyright Act. We are affecting the fortunes of people, many of whose fortunes are small. The stock agencies through their trade association worked out what they should do to register images with the Register of Copyrights, the Copyright Office established a clear procedure and the stock agencies followed it. The Copyright Office has maintained its procedure for three decades, spanning multiple administrations. The livelihoods of photographers and stock agencies have long been founded on their compliance with the Register’s reasonable interpretation of the statute. Their reliance upon a reasonable and longstanding administrative interpretation should be honored. Denying the fruits of reliance by citizens on a longstanding administrative practice reasonably construing a statute is unjust.

    I’m hoping this opinion has a reach further than just the identification of titles and authors in compliation works. I’ve spoken in the past about how impossible it has become to satisfy both the Copyright Office and the courts; hopefully this is the beginning of the correction.

    Alaska Stock, LLC v. Houghton Mifflin Harcourt Publishing Co., No. 10-36010 (9th Cir. March 18, 2014).

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    , , , ,

  • Words Matter

    “You keep using that word. I do not think it means what you think it means.”

    William Goldman, The Princess Bride (1973).

    I’m starting a new category of posts, about agreements where their wording, upon examination by a court, didn’t manage to do what the parties probably had set out to do.

    First up we have a patent case. Plaintiff Rehco, LLC entered into an agreement, the “Airplane Agreement,” to develop a radio-controlled airplane for Spin Master, Ltd., a toy company, in exchange for royalties. The agreement, in which Spin Master was called the “Assignee” and Rehco the “Developer,” provided in paragraph 3 that Spin Master could patent the invention at its sole discretion and that it would own any patent rights. The agreement then said this:

    Assignment and reversion

    If you can’t read it, it says:

    17. DEVELOPER hereby assigns to ASSIGNEE the sole and exclusive right within the entire world to manufacture, to have manufactured for it, to use, to sell, to distribute and to have distributed for it and in any other manner exploit the ITEM and the subject matter of all patents and patent applications on or to be filed on the ITEM. ASSIGNEE shall own all rights in development of ITEM, and DEVELOPER shall be obliged to deliver to ASSIGNEE the tangible materials of such development of ITEM. The rights granted by this Paragraph of this Agreement shall be referred to as the “Assignment.”

    18. If ASSIGNEE shall at any time default by failing to make any payment hereunder … and ASSIGNEE shall fail to remedy any such default within sixty (60) days after written notice thereof by DEVELOPER, then DEVELOPER may, at its option, terminate the Assignment by notice to that effect…. In the event of such termination, all rights granted by the Assignment shall revert back to DEVELOPER (the “Reversion”).

    Spin Master got a patent on the invention and the Rehco inventors assigned the invention directly to Spin Master. Many years later, Rehco alleged that Spin Master hadn’t paid the royalties and sued for past royalties and for patent infringement, on the theory that the patent had reverted to it under paragraph 18 of the agreement.

    But read paragraph 17 carefully. The court said this about it:

    [A]ssuming Spin Master did breach the Airplane Agreement, only the rights set forth in the Assignment Clause would have transferred back to Rehco. Such rights included “the sole and exclusive right . . . [to] exploit the [Airplane] and the subject matter of all patents and patent applications . . . on the [Airplane],” (Airplane Agreement ¶ 17), but not the patent rights themselves, which had been granted to Spin Master under a separate provision of the Airplane Agreement and, therefore, were not subject to the Reversion Clause.

    I suspect that a reversion only of the right to exploit the patent, rather than ownership of the patent itself, is not what the parties intended at the time they entered into the agreement. As interpreted by the court paragraph 17 is a license, which one would not normally refer to as a “reversion.”

    There’s also this curiosity:

    The [reversion] argument is somewhat puzzling, however, since a reversion typically implies “the returning of property to a former owner,” see, Miriam-Webster Online Dictionary, http://www. miriam-webster. com/ dictionary/ reversion (last accessed March 12, 2014), and Rehco never owned the ‘893 Patent. Indeed, as the Airplane Agreement made clear, the power to obtain and hold patent rights in the Airplane belonged to Spin Master alone. (Airplane Agreement ¶ 3).

    That is technically correct because, rather than having the Rehco inventors (presuably Rehco employees) assign their rights to Rehco, Rehco saved a step and had the employees assign the rights directly to Spin Master. Had the Rehco employees assigned to Rehco, then Rehco assign to Spin Master, the word “reversion” would have made more sense to the court.

    The fact that Spin Master was called the “Assignee” throughout also suggests that the parties contemplated that Rehco was assigning patent rights; it would have been an odd choice of words if the parties’ contemporaneous understanding was that Rehco never had any patent rights to start.

    But the court read the agreement the way it was written, with a defined “Assignment” that was really a license and a defined “Reversion” of that “Assignment.” Just probably not what the parties meant.

    Rehco LLC v. Spin Master, Ltd., No. 13 C 2245 (N.D. Ill. March 17, 2014).

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    , , ,

  • The Deposit Copy Doesn’t Define Your Ownership

    The case is several months old, but still worth writing about: it’s a cogent explanation by a court of appeals about the scope of copyright registration for joint works. The case is complicated with many issues, but I’ll only relate the part of the story relevant to ownership and registration of copyright.

    In 1993, Tina Lindsay developed rules for categorizing names by ethnicity, called the “Ethnic Determinate System” (EDS). The rules could be written out as text. In 1994, Lindsay asked Peter Brownstein to turn her rules into computer code. His programming became known as the ETHN programs and there were various versions over the years. The combination of Lindsay’s EDS with Browstein’s ETHN programs was named the “Lindsay Cultural Identification Determinate,” or “LCID.” By the time the case reached the appeal stage, it was uncontested that Lindsay was the sole author of EDS, which was an independent work of LCID, Brownstein was the sole author of the ETHN programs, which were also independent works of LCID, and they had an equal authorship interest in LCID as a joint work.

    Lindsay and Brownstein as equal owners formed TAP Systems, Inc. to commercialize the LCID. The LCID became known as the TAP system.

    Lindsay first registered the copyright in EDS in February 1996 and registered a derivative work in December 1996. In the second application, she described the “Nature of the Work” as “a computer system process and data roles” and stated in “Material added” “Description of computer process included.” She used the ETHN programs as the deposit copy but listed herself as the only author.

    In 1997, Lindsay unilaterally assigned the “ownership” (the court’s word; it was an exclusive license) of LCID—the combination of code and rules—to TAP Systems by signing a Software License both as “Copyright Holder” of LCID and agent of TAP Systems. Later the same year, TAP Systems (including Brownstein) and a company called Consumers Marketing Research, Inc. created a joint venture, Ethnic Technologies, LLC, which combined the LCID with CMR technology and called it “E-Tech.” Ethnic Technologies further licensed the E-Tech software.

    Relationships fell apart and there were multiple lawsuits, including an oppressed shareholder suit by Brownstein against Ethnic Technologies. Brownstein filed this lawsuit when he learned through discovery in the other suits that Lindsay used the ETHN programs as the deposit copy for her second application. He therefore filed a complaint asking for a declaratory judgment that he was joint owner of the copyright.

    The district court found in Lindsay’s favor in a bench ruling based on the statute of limitations. Alternatively, the court held that Brownstein was not a co-author of the LCID or the ETHN programs because “there is no evidence to support his claim of co-authorship in the record.”

    So here’s where the district court went wrong, in the appeals court’s words:

    Due to the District Court’s conflation of the EDS and the LCID, which are distinct works with distinct copyrights, it was misled into finding that Lindsay’s copyright registrations covered the entire LCID, including Brownstein’s ETHN programs. This false premise then led the District Court one step further to conclude that Lindsay could unilaterally transfer ownership of the LCID through the trio of licensing agreements that she executed. The District Court largely assumed that her copyright registrations covered the entire LCID because Brownstein’s ETHN programs were included as a “deposit copy” with her second registration. But the District Court’s assumption is belied by the copyright registrations themselves and the law undergirding the registration process. Lindsay’s copyright registrations only cover the EDS.

    The appeals court explained that the first registration was clearly for the EDS and, since the second registration had the same title and was claimed as a derivative work, it must also be for the EDS only. Lindsay hadn’t identified the ETHN programs as part of the scope of the claim, so the only way the lower court could have concluded the ETHN programs were claimed was because of the deposit copy. But a deposit copy doesn’t define copyright ownership:

    Pivotal to this case is distinguishing an author’s interest in the copyright to his work from the registration of his work. A “copyright”, as a right, vests immediately upon the creation of the work. For this reason, a copyright must not be confused with the act of registering that right. Registration serves primarily to create a record of the creation of the work and it also allows the author to bring civil claims under the Copyright Act.

    With few exceptions, a deposit copy must be submitted with an application for copyright registration. A deposit copy does not necessarily limit the copyrightable work itself. Here, a deposit copy means that Lindsay sent a physical printout of Brownstein’s code to the Copyright Office for safekeeping (and was only sent a deposit receipt in return), which would serve an “archival function” in the event of infringement and help elucidate her copyrightable work.

    …

    Thus, the fact that Lindsay submitted Brownstein’s code in the form of the deposit copy does not establish that she held a copyright to his ETHN programs or the LCID as a whole. Since Brownstein, alone, wrote the code, the only rights Lindsay could have had to his code would flow through the LCID as a joint work with her rules. Further, even if her registrations covered the LCID and were entitled “The LCID, Including the ETHN Programs”, that act would not vest exclusive ownership of the LCID in Lindsay. Brownstein would remain a co-author and co-owner because copyright registration does not establish the copyright, which attaches at the moment of creation. Consequently, Lindsay’s copyright registrations, if anything, are merely placeholders for the indivisible joint rights she inherently had in the EDS and the LCID with Brownstein.

    Having established who owned what, the court then evaluated whether any of the various subsequent agreements affected ownership, finding they did not. Since Lindsay was only a joint owner of the LCID, she couldn’t convey exclusive rights to TAP Systems. “As with tenants in common of real property, a co-author can transfer or assign the rights to his ownership interest in the joint work, but this does not affect the ownership rights of his co-author.” This would have been true even if Lindsay’s copyright registration was for the LCID work as a whole.

    And since there was no transfer of Brownstein’s copyright to TAP Systems, any subsequent transfers by TAP Systems couldn’t divest him of ownership either. Nor did the settlement agreement in Brownstein’s oppressed shareholder suit affect his ownership; that agreement only quashed his “right, title and interest” as a “shareholder, officer, employee or director,” not as copyright owner.

    It’s pretty clear that, until the lawsuit, it never occurred to anyone that there might be more than one copyright in the LCID work; that was the assumption behind all the various settlement and licensing agreements. When it got to litigation there was a work made for hire theory, but that was essentially conceded by the time the case reached the appeals court. So the appeals court decision makes it all sound so clean, but that’s only because very messy facts got whittled down.

    If you’re interested, there’s more in the opinion about when an authorship claim accrues in a jurisdiction using the discovery rule. And, by the way, a district court cannot cancel a copyright registration because it does not have statutory authority to do so.

    Brownstein v. Lindsay, Nos. 12-2506, 12-4471 (3rd Cir. Jan. 29, 2014).

    , , ,

  • It’s Not That Hard

    It’s not a hard concept—to bring a copyright infringement lawsuit you have to own a copyright. Nevertheless, getting that right seems to be a challenge sometimes.

    Today’s version of the challenge is ownership of the copyrights for works created by Earl Vernon Biss, Jr., who died in 1998 – here is his biography on one of the defendant websites. Plaintiff Lou Lou Goss is his surviving spouse and sole heir.

    Lou Lou filed the copyright infringement lawsuit in May of 2012, then filed for bankruptcy in October, 2013. The bankruptcy court allowed the bankruptcy claimants to seek a judicial determination from the Colorado state probate court on ownership of the Biss copyrights and any claims arising from the copyrights. The probate court found, based on Lou Lou’s own filings as personal representative of the estate, that the copyright and litigation claims “were and remained property of [Biss’s] Probate Estate subject to probate administration, including the claims of creditors and the costs and expenses of probate administration.” The probate court then authorized a sheriff’s levy on the copyright and litigation claims for execution sales to satisfy creditors’ claims.

    So simply enough, if the copyrights were part of Biss’ probate estate, Lou Lou didn’t own them. Which means she didn’t have standing and her copyright infringement case was dismissed.

    Goss v. Zueger, Civ. No. 1:21-cv-01424-DME-BNB (D. Colo. March 7, 2014).

    , ,

  • It Was Assigned

    Last Friday I asked whether a document entitled “Recording Release” transferred copyright ownership of the four songs listed at the bottom. The answer is that it most certainly did.

    One defect in the document was that it only ever mentioned “you” as the transferee of the rights. The court, sitting as factfinder, held it was clear enough who “you” was:

    [T]he Court finds that the release, on its face, transfers Kole’s entire interest to all versions of the Recordings to “you.” The circumstantial evidence strongly indicates that “you” must be Jayarvee (Valenti). This is proved, not only by Valenti’s testimony, which the Court credits, but also by the adverse inference that the Court draws from Kole’s dubious testimony. It is further evidenced by the fact that the original remained in Valenti’s possession, suggesting that the parties intended to release the Recording to Valenti/Jayarvee, and by the fact that the You Are There Release corresponded in every material respect to the [unlitigated] Moments Like This Release, which even Kole concedes was a transfer of her copyright to Jayarvee. It also appears that third parties operated on the assumption that Jayarvee (Valenti) owned the copyright and that Kole did not challenge that assumption.

    But the dispute wasn’t so much about the language of the document itself, but rather the circumstances in which it came about. Valenti, the assignee of the copyright in Kole’s musical performance, was her boyfriend and the lawsuit is after an acrimonious split: “The break-up was bilious, and the mutual hostility between Kole and Valenti remained fully evident at trial.”

    The “dubious testimony” by Kole was this:

    At trial, Kole testified that the release was “never intended for anyone,” and that she signed and wrote her personal information, including her Social Security number, on the You Are There Release while it was substantially blank, simply to demonstrate to an elderly musician, Hank Jones—now deceased but then aged 89 or 90, and one of the musicians with whom she had recorded a duet—how the form should be filled out. On three prior occasions, however, Kole had testified that she could not remember the identity of the person for whom she had signed the form. Upon being asked at trial why she did not print Hank Jones’s name rather than her own in showing the elderly pianist how to sign the release, Kole answered “[m]y first reaction of you sign your name is I sign my name. You sign your address … Social Security number, and that’s how you do it.”
     
    Kole further testified that after signing the release as an example for Hank Jones, she placed it in her file, and that a full year later, she handwrote the four song recordings on the bottom of the page as an entirely unrelated notation, using the paper as essentially “scrap paper.” When asked for what purpose she wrote down the songs at all, Kole testified that “I was looking at what was recorded and what were the other songs that were going to work in their place. For example, I needed to find more of a swing song for Our Love Is Here To Stay, or I had to find a comparable ballad to My Romance. Things of that nature. It’s meaningless.”

    One of the things I like about this decision is that it shows the difference between the burden of proof on summary judgment and after a trial. In this case it was the same judge for both, but the decision carefully explains where the judge was weighing facts, like this:

    The original of the You Are There Release, as presented as an exhibit at trial, had staple holes in the upper left corner. While Valenti testified that he had stapled the You Are There Release to the Moments Like This release, Kole testified that she had stapled the You Are There Release to a list of songs. Upon observation, the Court found that the placement of the staple holes in the You Are There Release correspond exactly with the placement of the staple holes in the Moments Like This release, in a manner that would have occurred if the two equal-sized pieces of paper had been stapled together.

    Kole had released copies of her performance and was sued for it; since she had assigned the copyright she had no ownership defense and was enjoined.

    Peterson v. Kolodin, No. 13 Civ. 793(JSR) (S.D.N.Y. Jan. 29, 2014). Two releases (unfortunately without noticeable holes) here.

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

  • How Not to Manage a Brand

    I’m very interested in C.F.M. Distributing Co. v. Costantine, a case about a failed franchise and a son’s effort to revive it. The effort failed because there were so many former uncontrolled licensees that the Trademark Trial and Appeal Board held (as affirmed by the Federal Circuit) that the applicant was not the owner of the mark. The decision involved two design applications for “Maryland Fried Chicken” stores:

    From TSDR
    Ser. No. 77497042

    From TDSR
    Ser. No. 77402411

    One of the definitions of “abandonment” is where “any course of conduct of the owner, including acts of omission as well as commission, causes the mark to … lose its significance as a mark.” Lanham Act § 45; 15 U.S.C. § 1127. This is one case that vividly demonstrates that principle, that is, a symbol that has every characteristic of a mark nevertheless can lose that significance when there is no effort to maintain uniformity of use.

    As demonstration, below is a collection of the signs for many “Maryland Fried Chicken” restaurants, mostly in Florida, Georgia and South Carolina, taken from Google Street View. Be on the lookout in particular for:

    • A sign that says “Rice Bowl, Chinese Cuisine”
    • Three barbecue restaurants
    • Three shrimp restaurants
    • Two signs for the “Original” Maryland Fried Chicken that use a different chicken (and plenty of signs without a chicken at all)

    Sign closeup rev3 sharpened

    One of  the TTAB’s comments on the state of affairs:

    The members of the public in the southeastern portion of the United States, and especially in Central Florida, have been faced for decades with products and services bearing visually similar Maryland Fried Chicken trademarks and service marks. However, with each outlet having such diverse qualities, we find that these logos have totally lost any of their earlier abilities to identify a sole source. It would seem at this late date that very few members of the consuming public in Central Florida (or elsewhere) still contemplate a single enterprise as standing behind the Maryland Fried Chicken products or services. Those few who do anticipate the consistent quality of the prototypical franchise operation will likely find themselves disappointed as they take their business from one Maryland Fried Chicken outlet to another.

    For the Bob Marley bonus, as well as more Street View images and other evidence in the case, click here.

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

    , , , , , , ,

  • You Be the Judge

    Here’s a document—does it transfer copyright ownership? The court held on a motion for summary judgment that it was a question for the finder of fact. The same judge, in a bench trial, has now decided. Which way did it go?

    Click for larger version
    Click for larger version

    Add comments below.

    Updated 19 Feb. 14: Follow up post here.

    Creative Commons License
    The text of this work is licensed under a Creative Commons Attribution-No Derivative Works 3.0 United States License.

About Me

Learn more about me at my website, Chestek Legal

Recent Posts

Categories

Newsletter