Flashcards in Cases Deck (43)
Monopol-Films AG v. Chaplin et The Roy Export Company (Swiss
Supreme Court ATF 96 II 409, IIC 1971, 315 The Gold Rush)
1 National Treatment
• 1925: Chaplin (claimant) made a silent film « The Gold Rush », shown
in US and Canada and 1942 adapted it into a talkie
• 1962: Monopol-Films AG (defendant) adapted a new staging without
Chaplin’s authorization in order to distribute the film in Swiss theaters
Facts: Copyright protection against an unauthorized showing and partial adaptation of a Chaplin film that was first published abroad. Substitution of background music violated Chaplin’s moral right.
- Chaplin argues that the work was simultaneously first published in US (non member of Convention) and Canada (member of Convention)
- Defendant argues that it was only first published in US (not truly “simultaneous” in Canada; and that in Canada there were insufficient distribution outlets)
Held: The moral right of the author is protected in Switzerland under Art 6bis Berne Convention and Art 28 Civil Code (ZGB)
- Defendant infringed upon Chaplin’s personal interests.
Reasoning: To prove a violation of his moral rights, the author need not establish damage to his reputation; it is sufficient that the modification or impairment of the work could be detrimental to his honor or reputation.
- Individual case by case examination, particularly on the kind and quality of work and the author’s personality, in determining whether the modification of a work violates the personal interests of the author
Under Art 4(4) of the 1908 Berlin Act, published works within meaning of the Convention are works copies of which have been issued to the public
- Publication does not mean just taking notice of the work, but when it is made in sufficient quantities
A dramatic work doesn’t need much distortion/modification in order for it to be a violation of the author’s personal interests.
- The closer the work is to an expression of the author’s personality, the more it is based on his/her personality, the closer the ties, then the sooner a modification by a third party can be found to constitute a violation of Art 28 Civil Code
Moberg v. 33T LLC, Civil No. 08-625(NLH)(JS) (D. Del. Oct. 6, 2009)
Principle: lacks subject matter jurisdiction
Swedish photographer brought copyright infringement action against a Delaware company and two French citizens, alleging the unauthorized posting, on three U.S. websites, of five copyrighted photographs originally published on German website. Defendants filed three separate motions to dismiss.
-Moberg is a professional photographer from Sweden.
-He is the owner of a series of photographs which were first published in 2004 on a German website, blaugallry.com which is an online art shop that offers copies of the works for sale as canvas prints stretched over a wooden framework.
-on December 2007 five of plaintiff’s photographs were posted on the 3 websites.
- Two of these websites are registered to 33T LLC. Delaware limited liability company, with a registered office in Delaware.
-in December 2007 the Plaintiff’s Attorney contacted Cedric Leygues and 33T regarding their unauthorized use of plaintiff’s photographs, and demanded that they cease their use.
-when plaintiff filed his complaint in September 2008, some of his images had been removed, but others still remained.
-Claims that defendants have violated the US Copyright Act, 12 §501 and DMCA of 1998 17 U.S.C. §1201
(1) as a matter of first impression, publication ofphotographs on a German website did not amount toa simultaneous publication in the U.S., via theInternet;
(2) district court would quash plaintiff's prior at-tempts at service and direct that he accomplish service pursuant to other available avenues; and
(3) jurisdictional discovery, limited to determining the contacts with Delaware of a website owned by aFrench citizen, was required. Motions denied.
This case concerns defendants' use of plaintiff'scopyrighted photographs, and it raises issues of firstimpression with regard to foreign copyrightedworks posted on the Internet
1. Lack of personal jurisdiction for plaintiff’s Copyright Act claims
2. Faulty service
3. Lack of personal jurisdiction over Erwan Leagues
Stokke Gruppen AS v. Trip Trap Denmark A/S (Swiss Supreme Court, ATF
130 III 267,  E.T.M.R. 90)_
Facts: First Norwegian claimant makes TRIPP TRAPP chairs and has registered trademark across various countries. Second claimant distributes furniture, especially the products of the first claimant. Danish Defendant Trip Trap makes furniture as well and distributes in Switzerland.
Issue: Whether there is trademark infringement.
Held: Appeals dismissed. Cease and desist grant to claimants remains.
- Article 11(2) TMA provides that the use of a trade mark in a form that differs only insignificantly from the registration is sufficient to maintain the validity of the trade mark.
- **What is decisive is that the distinctive part of the trade mark, which influences the overall impression of the trade mark, maintains its identify and remains unchanged in spite of the use in a different form
o Therefore, the threshold of identity of the sign in the distinctive part of the trade mark is to be set to a higher level than in the case of the test relating to the risk of confusion
Conflict between two signs: earlier one enjoys propriety, unless Art 6bis of Paris Convention applies in which it deems the trade mark that is well-known in Switzerland would be deemed an earlier trade mark.
- The being well-known of a trademark does not require the use of the trademark in Switzerland and must only be examined on the basis of the degree of being well-known in the relevant market sector
Art 6 Bis of the Paris Convention and Art 16 TRIPS apply.
**Definition of a well-known trademark:
- International and national legislation do not define what is a well-known trademark.
- WIPO recommendations on interpretation provide that whether a trademark is well-known must be judged on the basis of the specific merits of each case and the following criteria:
o The degree of fame of the trademark in the relevant market
o The duration
o The broadness and the geographical area of use of the trademark and of the advertising of the trademark
o The duration and the geographic extension of registration
o The past protection of the trade mark, in particular through the recognition of the well-known character by competent authorities in some countries of the Union as well as the value of the trademark
- Criteria must be of a qualitative and not just quantitative nature. Dependent on the degree of knowledge of the sign and the way it is understood as a trademark by the relevant sector of the public cannot just be quantitative.
- Need to take into account of the WIPO factors for a general assessment
- It is sufficient for a trademark to qualify as well-known if it is well-known with the relevant sector of the public (here, chairs are famous in the target baby sector)
Article 8 of Paris Convention does not require a trade name to be well-known before it is protected.
ITC Limited v. Punchgini, Inc., 482 F.3d 135 (2nd Cir. 2007)
Facts: claims of trademark infringement and unfair competition in connection with a restaurant trademark, “Bukhara,” as well as related trade dress that plaintiffs had not used in the United States for more than three years.
On this appeal, plaintiffs challenge an award of summary judgment in favor of defendants. In that decision, this court affirmed the grant of summary judgment on ITC's trademark infringement claims under section 32(1)(a) of the Lanham Act and New York common law, concluding that ITC had abandoned its Bukhara mark for restaurant services in the United States. See ITC Ltd. v. Punchgini, Inc., 482 F.3d at 142. We further affirmed summary judgment on ITC's federal unfair competition claim because it depended on the “famous marks” doctrine, which Congress has not yet incorporated into federal trademark law.
Rule of Law
Foreign trademark holders will not have priority of trademark rights in the United States through the famous-marks doctrine for federal unfair-competition claims.
ITC Limited (ITC) (plaintiff) owned a hotel in India in which it operated a restaurant called “Bukhara.” This restaurant had been operated since 1977 and had gained some international fame. ITC had also opened franchises of Bukhara in multiple countries over the years. In 2004, ITC had Bukhara restaurants in New Delhi, Singapore, Kathmandu, and Ajman. ITC had opened Bukhara restaurants in New York City and Chicago in 1987. ITC then registered the trademark “Bukhara” for restaurant services with the United States Patent and Trademark Office in October 1987. However, the New York City restaurant closed in 1991, and the Chicago restaurant closed in 1997. Punchgini, Inc. (Punchgini) (defendant) opened an Indian restaurant in New York City in 1999 and chose the name “Bukhara Grill.” The founders of Punchgini had worked at ITC’s restaurants prior to founding Bukhara Grill. Punchgini argued that ITC had abandoned its trademark. ITC sued on the basis of unfair competition under the Lanham Act.
Will foreign trademark holders have priority of trademark rights in the United States through the famous-marks doctrine for federal unfair-competition claims?
Holding and Reasoning (Raggi, J.)
No. Foreign trademark holders will not have priority of trademark rights in the United States through the famous-marks doctrine for federal unfair-competition claims. Under the Lanham Act’s territoriality doctrine, a trademark holder will only have priority of trademark rights in the United States based upon priority use in the United States and not based on the trademark holder’s use in foreign countries. A possible exception to this rule is the famous-marks doctrine, which states that if a foreign mark has obtained sufficient fame in the United States, the trademark holder will have acquired priority of trademark rights over later American users. It is unclear whether the famous-marks doctrine has any basis in federal law. The Ninth Circuit Court of Appeals is the only federal appellate court that has recognized the famous-marks doctrine in federal law but did not base its decision on the Lanham Act or other federal law. The United States is a signatory to the Paris Convention for the Protection of Industrial Property (21 U.S.T. 1583, July 14, 1967) (Paris Convention). Article 6bis of the Paris Convention provides protection to famous marks used in foreign countries. However, the Paris Convention is not self-executing, and Congress has made no effort to enact Article 6bis into federal law United States courts, such as the Second Circuit in Empresa Cubana del Tabaco v. Culbro Corporation, 399 F.3d 462 (2d Cir. 2005), have also held that the Paris Convention does not create any substantive rights, beyond those described in the Lanham Act, in the United States for foreign trademark holders. Section 44(b) of the Lanham Act, 15 U.S.C. § 1126(b), only grants to foreign trademark holders the same rights already granted in the Lanham Act to American trademark holders. In this case, ITC had closed all its restaurants in the United States prior to the opening of Punchgini’s restaurants. Therefore, the only way for ITC to show that it has a priority right over the trademark and enforce its foreign trademarks in the United States in a federal unfair-competition claim would be under the famous-marks doctrine. Because there is no federal-law basis for the famous-marks doctrine, the district court’s decision is affirmed, and Punchgini’s motion for summary judgment is upheld.
Merck Genéricos, Produtos Farmacêuticos Lda v. Merck & Co. Inc., Merck
Sharp & Dohme Lda, ECJ Decision of September 11, 2007, Case C431/05
Issue: patent under the article 33 TRIPS terms of protection,
- 'The term of protection available shall not end before the expiration of a period of 20
years counted from the filing date.
- Article 94 of that code provided that patents should be valid for a period of 20 years
from the date on which the application was filed
Federal Supreme Court Decision of 07 12 1999 - Kodak II (ATF 126 II129
- IIC 2000, 1018)
Facts: P is a purely distribution company and holds exclusive Kodak distribution rights for Switzerland, and supplies wholesalers and retailers. D (Jumbo-Markt AG) sells Kodak products that obtains parts from sources authorized by the P. D also sells UK Kodak products that were put out for UK market as intended by Kodak.
- P sues D for distributing the UK Kodak products
Issue: The sole point of dispute is whether the rights under the Swiss patent are also exhausted if the goods are put into circulation abroad by the Swiss patent holder or with his consent (principle of international exhaustion)
Held: National exhaustion for Switzerland. By putting the goods into circulation in the UK, the plaintiff did not exhaust its powers under the Swiss patent. As holder of the Swiss patent, the P can oppose the import of products manufactured according to its patent.
- The putting into circulation specifically exhausts the patent holder’s rights to the commercial use, property owner rights trump the patent holder rights given that the latter are exhausted
- Here this is about international exhaustion
- Swiss Patent Act ends at frontiers (strict territoriality)
- A European patent is broken down upon grant into national patents and subject to the corresponding national laws
- Art 28 of TRIPS Agreement, patent holder can prevent third parties selling their objects and importing for such purpose
Question of whether patents warrant a different treatment of exhaustion compared to trademark and copyright law
- Copyright and patents are about primary exploitation right, where trademark is for identification mark
- In Germany and elsewhere, trademark gets international exhaustion; patents national exhaustion – each country responsible for the reward in that country
- France, Italy, Germany all used national exhaustion for patent law
“To the benefit of the dealer and the end user [lower prices], the theory of exhaustion limits the exploitation monopoly of the patent holder to a monopoly on the first disposal of the product manufactured according to the patent.”
- “The profit obtainable from the first disposal of the patented products is intended to permit the inventor to obtain the value corresponding to the technical progress achieved through the invention”
- Doctrine of exhaustion achieves an appropriate balance between the interests of the dealer/user and the patent holder
International exhaustion would not allow patent holder to reap full profits – if first circulated in a country with lower purchasing power, then the patent holder wouldn’t be able to recoup costs of developing the patented object in Switzerland
In Switzerland – National exhaustion rule
- The patent holder in Swz is entitled to this right of first circulation even if the goods have been put into circulation abroad with his consent under conditions that are not comparable
- International exhaustion is not an appropriate balancing of competing interests
Consequently, national exhaustion must be assumed for Swiss patent law
Silhouette International Schmied GmbH Co. KG v. Hartlauer
Handelsgesellschaft mbH, ECJ Decision of July 16, 1998, Case C-355/98
In the case, which lead to the ruling of the European Court of Justice (ECJ), the
plaintiff, Silhouette, was an Austrian producer of spectacles in the higher price
ranges. It marketed the spectacles worldwide under the trademark Silhouette, which
was registered for it in Austria and in most other countries of the world. Silhouette
supplied spectacles to opticians, but not to Hartlauer, the defendant, because it
considered the distribution by this low-price retail chain to be harmful to its image.
After Silhouette had cheaply sold a number of outdated spectacles to a Bulgarian
company, Hartlauer purchased them and offered them for sale in Austria.
Silhouette brought an action for interim relief seeking an injunction preventing
Hartlauer from offering spectacles for sale in Austria under its trademark, since they
were not put on the market in the European Economic Area (EEA) by Silhouette itself
or by third parties with its consent. While Silhouette's action was dismissed in first
instance and on appeal, the Austrian Supreme Court found that there were two
questions of community law involved which required clarification by the ECJ and
stayed the proceedings. These questions were:
"(1) Is Article 7 (1) of the First Council Directive 89/104/EEC of 21 December 1988 to
approximate the laws of the Member States relating to trade marks
(OJ 1989 L 40, p. 1) to be interpreted as meaning that the trade mark entitles its
proprietor to prohibit a third party from using the mark for goods which have been put
on the market under that mark in a State which is not a Contracting State?
(2) May the proprietor of the trade mark on the basis of Article 7 (1) of the Trade
Marks Directive alone seek an order that the third party cease using the trade mark
for goods which have been put on the market under that mark in a State which is not
a Contracting State?"
As to the first question submitted to Article 7 of Council Directive 89/104/EEC the
ECJ stated that in the specified circumstances the exclusive rights conferred by
Article 5 (1) were exhausted. According to the text of the Directive itself, exhaustion
only occurred where the products have been put on the market in the EEA by the
proprietor or with his consent. No other interpretation of the Directive was presented
to the court. Hartlauer and the Swedish Government maintained, however, that
Article 7 did not comprehensively resolve the question of an exhaustion of trademark
rights and therefore left it open to the member states to adopt rules going further
than those explicitly laid down.
Silhouette, the Austrian, French, German, Italian and United Kingdom Governments
and the European Commission, on the other hand, argued that the interpretation
proposed by Hartlauer and the Swedish Government were contrary to the wording of
Article 7 and to the purpose of the Directive. After a discussion of recitals in the
Directive's preamble, the ECJ arrived at the conclusion that Articles 5 to 7 had to be
construed as to provide for a complete harmonisation of trademark rights. In
particular, the fact that Article 5 (2) gave the member states an option to grant more
extensive protection to trademarks with a reputation implied that such an option was
not granted in other respects. Moreover, this was the only interpretation which
ensured the functioning of the internal market. The contrary interpretation would
inevitably give rise to barriers of the free movement of goods and the freedom to
provide services. Thus national rules providing an exhaustion of trademark rights in
respect of products put on the market outside the EEA by the proprietor or with his
consent were contrary to Article 7 (1) of the Directive as amended by the EEAAgreement.
As to the second question the ECJ held in conformity with its settled case-law that a
Directive cannot of itself impose obligations on an individual and cannot be relied
upon as such against an individual. Further, the ECJ emphasised that national courts
had to interpret domestic law, as far as possible, in the light of the wording and the
purpose of the Directive in question. Article 7 (1) could not provide the sole basis for
an order restraining a third party from using a trademark for products which have
been put on the market outside the EEA under that mark by the owner of a
trademark or with his consent.
Laserdisken ApS v. Kulturministeriet, ECJ Decision of September 12,
2006, Case C-479/04
The Court of Justice handed down an interesting judgment in Case C-479/04 Laserdisken ApS v. Kulturministeriet on the validity of Directive 2001/29 on the harmonization of certain aspects of copyright and related rights in the information society.
The case arose because the plaintiff in the main proceedings, Laserdisken, sells DVDs in Denmark. Laserdisken sold all kinds of DVDs, including original American editions and a wide range of films which were not otherwise available in Europe. But then Article 4 (2) of the Directive provided that the distribution right shall not be exhausted within the Community in respect of the original or copies of the work, except where the first sale or other transfer of ownership in the Community of that object is made by the rightholder or with his consent. In fact, Article 4 (2) had a major impact on Laserdisken's trade in non-EU DVDs. As a result, Laserdisken sued the Danish Ministry responsible for implementing the Directive and claimed, among other things, that the Directive breached the right of freedom of expression because citizens were deprived of their right to receive information in breach of Article 10 of the European Convention on Human Rights.
The Court rejected Laserdisken's claims and upheld the validity of Directive 2001/29 because it helped to protect copyright.
The Court held that freedom of expression is a fundamental right the observance of which is ensured by the EC courts (see Case C-260/89 ERT, paragraph 44). But, if the exhaustion rule laid down in Article 4(2) of the Directive does restrict that freedom to some extent, the Court pointed out that Article 10(2) of the ECHR allows the freedoms guaranteed by Article 10(1) ECHR to be limited for certain reasons in the public interest, including the protection of intellectual property rights like copyright.
Davidoff, ECJ, Joint Cases of November 20, 2001, Case C-414/99, C415/99
The European Court of Justice (ECJ) decided on November 20, 2001 against parallel importers who import branded products into the European Economic Area (EEA).
The ECJ decision is the result of references made by the English High Court in two parallel import cases concerning the branded goods of Zino Davidoff and Levi Strauss & Co. The decision is supported by INTA's March 8, 2001 Board Resolution on "Consent" to Parallel Importation.
In the Davidoff case, A & G Imports acquired stocks of Davidoff branded "Cool Water" and "Davidoff Cool Water" perfumes, which had been marketed in Singapore by Davidoff. A & G imported the perfumes from Singapore into the United Kingdom. In the Levi Strauss case, Tesco (a U.K. supermarket chain) and Costco bought genuine LEVI'S 501 jeans from suppliers outside the EEA and sold them in the UK. Levi Strauss had always refused to sell jeans to Tesco and Costco in the United Kingdom.
Davidoff and Levi Strauss sued the parallel importers for trademark infringement. The High Court's references to the ECJ asked for clarification of the extent of the concept of exhaustion of trademark rights and the meaning of "consent."
The ECJ decision confirms the long established principle (now enshrined in the Trade Marks Directive) that a brand owner's trademark rights within the EEA are exhausted only where goods bearing a trademark have been put on the market in the EEA by the brand owner or with his consent.
In relation to goods put on the market outside the EEA, the court confirmed that, as consent to the importation of such goods into the EEA essentially removes a brand owner's exclusive trademark rights, it must be expressed unequivocally. This will normally be an express statement of consent, although in some cases, it might be inferred from facts and circumstances prior to or at the time that the goods are placed on the market outside the EEA. Furthermore, a parallel importer alleging consent on behalf of a trademark owner must now carry the burden of proof rather than the trademark owner demonstrating absence of consent.
Finally, on the subject of contractual relations, the court confirmed that silence is not deemed consent and that implied consent cannot be inferred from a brand owner not imposing contractual reservations in its contracts with its distributors, failing to communicate its opposition to marketing within the EEA or failing to ensure that the goods carry a warning of prohibition on sale within the EEA.
The judgment is important because it makes it much more difficult for parallel importers to argue that the brand owner has consented to the goods being put on the market leading to trademark rights exhaustion. Without any express license from a brand owner or its authorized licensee, there is now a greater risk that a parallel importer of branded goods into the EEA from outside will infringe a registered trademark. This makes it much more important for retailers to ensure either that they have the trademark owners' consent or, where this is unclear and impractical to obtain, that they have adequate contractual protection from whoever sold them the goods.
Kirtsaeng, DBA Bluechristine99 v. John Wiley Sons, Inc. (568 US - 11-
Facts: Kirtsaeng, Thai graduate student, sued by publishers for reselling books he had bought in Thailand then brought over the US.
Issue: Does the “first sale” exhaustion doctrine apply abroad? Is the buyer free to bring the copy into the US and dispose of it as he or she wishes?
Holding: Wherever a copy of a book is first made and sold, it can be resold in the US without permission from the publisher.
Reasoning: Breyer J Majority
S106(3) forbids distribution of copies without copyright owner’s permission, but S109(a) provides that once a copy has been lawfully sold, the buyer of that copy and then freely dispose of it as they wish.
- First sale would then be “exhausted” by the “first sale”
Whether “lawfully made under this title” restricts the scope of s 109(a)’s “first sale” doctrine geographically.
“The language of s109(a) read literally favours Kirtsaeng’s nongeographical interpretation, namely, that “lawfully made under this title” means made “in accordance with” or “in compliance with” the Copyright Act.
So wherever a copy of a book is first made and sold, it can be resold in the US without permission from the publisher.
Rule of Law
There is no geographical limit in determining which works fall under the first-sale doctrine.
John Wiley & Sons, Incorporated (Wiley) (plaintiff) published academic textbooks in the United States and abroad. Books printed in Asia were licensed to a foreign subsidiary and then manufactured and sold throughout Asia. The copyright notice on the foreign books stated that the books were only authorized for sale in Europe, Asia, Africa, and the Middle East. Supap Kirtsaeng (defendant) moved to the United States for college and stayed through completion of a PhD program. While living in the United States, Kirtsaeng had friends and family in Thailand purchase English language textbooks legally sold in Asia and ship the textbooks to Kirtsaeng. Kirtsaeng then sold the books at a lower cost than the United States editions. Wiley sued Kirtsaeng for copyright infringement based on Wiley’s exclusive right to distribute the copyright protected works. The district court held that the defense of the first-sale doctrine did not apply, because the textbooks were manufactured outside of the United States. On appeal, the majority opinion of the circuit court panel held that the first-sale doctrine did not apply to copies of American works manufactured outside of the United States. Kirtsaeng petitioned for certiorari, which was granted.
Is there a geographical limit in determining which works fall under the first-sale doctrine?
Holding and Reasoning (Breyer, J.)
No. There is no geographical limit in determining which works fall under the first-sale doctrine. Under 17 U.S.C. § 109(a), a copyright holder’s exclusive distribution right does not apply to individual copies once the copies are legally sold. Analysis is required to interpret § 109(a)’s words “lawfully made under this title.” The words “lawfully made” impose a requirement that the manufacture and initial sale were legitimate. The words “under this title” specify that the copy’s production and sale had to comply with the Copyright Act. An attempt to read a geographical limitation into the manufacture or sale of the copy is unfounded. Not only is there no statutory basis for interpreting the statute this way but doing so would bring trade to a halt. Many goods sold in the United States are initially legally manufactured abroad. Further, books available in libraries or sold in secondhand stores are often produced or sold overseas before being imported to the United States. Further, Congress has amended the statutory language for the first-sale doctrine since it was first enacted. At no point was a geographical limitation introduced, either in the text or the legislative history. By contrast, some other provisions in the Copyright Act previously had geographic restrictions, which have since been removed. Finally, there is no binding precedent supporting a geographic limitation. Quality King Distributors, Incorporated v. L’anza Research International, Incorporated, 523 U.S. 135 (1998), held that the first-sale doctrine applied if goods were initially produced in the United States but sold internationally. Although the Quality King court implied that a different result might have been reached if production had occurred outside the United States, the statement was not vital to the opinion, and the location of production was not at issue in the case. The remainder of the Quality King opinion, other prior precedent, and the statutory language all support a conclusion that there is no geographic limitation to the initial production or sale location under the first-sale doctrine. Here, because the textbooks Kirtsaeng imported to the United States were legally produced and sold in Thailand, the first-sales doctrine applies, and the sales do not infringe Wiley’s distribution rights. The judgment of the circuit court is reversed.
Campbell v. Acuff-Rose Music (92-1292), 510 U.S. 569 (1994)
Facts: Acuff Rose Music (Respondent) sued Campbell (Petitioners) claiming that 2 Live Crew’s song Pretty Women infringed Acuff Rose’s copyright in the rock ballad “Oh, Pretty Woman”.
Holding: 2 Live Crew’s commercial parody may be a fair use within meaning of S. 107 (which provides for fair use of a copyrighted work for criticism and parody etc).
Four factors for s 107 fair use of copyrighted works
1. Purpose and Character. Whether it’s of a commercial nature; whether new work merely supersedes the objects of the original creation or if it’s transformative and gives it new meaning (more transformative, the more fair use it is)
a. Commercial character is only one element to be weighed for the first factor of Purpose and Character.
2. Nature of the copyrighted work: not much help here, parodies invariably copy original work
3. The amount and substantiality of the portion used in relation to the copyrighted work as a whole are reasonable
a. Even if the new song goes to “heart” of the original song, that’s fine because that’s for parodic purpose
4. The effect of the use upon the potential market for or value of the copyrighted work
a. The cognizable harm is market substitution, not any harm from criticism
Rule of Law
The commercial nature of a parody is not dispositive in a fair use analysis.
In 1964 Roy Orbison and William Dees wrote the song “Oh, Pretty Woman,” and assigned their rights to Acuff-Rose Music, Inc. (Acuff-Rose) (plaintiff). In 1989 Luther Campbell and his group 2 Live Crew (defendants) wrote a song called “Pretty Woman,” in which the group intended, “through comical lyrics, to satirize the original work.” The 2 Live Crew song copied Orbison’s opening bass riff and first line of lyrics, but generally, the 2 Live Crew song replaced Orbison’s romantic lyrics with “degrading taunts, a bawdy demand for sex, and a sigh of relief for paternal responsibility.” The district court granted summary judgment to 2 Live Crew. The United States Court of Appeals for the Sixth Circuit (Sixth Circuit) reversed, finding that the 2 Live Crew song’s “blatantly commercial purpose” prevented it from being a fair use, and that 2 Live Crew copied too much of Orbison’s song to constitute fair use. The United States Supreme Court granted certiorari.
Is the commercial nature of a parody dispositive in a fair use analysis?
Holding and Reasoning (Souter, J.)
No. In determining whether a work was fair use, the court looks to four factors: (1) the purpose and character of the use; (2) the nature of the copyrighted work; (3) the substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect on the potential market for or value of the copyrighted work. Under the first factor, the commercial nature of a parody is not dispositive in a fair use analysis. In this case, the Court holds that the Sixth Circuit’s finding of no fair use on account of the purely commercial nature of 2 Live Crew’s song was in error. (1) Although the purpose of 2 Live Crew’s use of Orbison’s song was commercial, that is not dispositive of the fair use analysis. In addition to being commercial, the purpose of 2 Live Crew’s use was to parody Orbison’s song, which swings the balance back toward a finding of fair use. The 2 Live Crew song juxtaposed Orbison’s romantic lyrics with unexpected, even shocking lyrics as a means of comparing the society that Orbison was describing with the “ugliness of street life and the debasement that it signifies.” The Sixth Circuit’s analysis was thus in error. (2) Orbison’s song is clearly a creative work that is entitled to copyright protection. (3) While the opening riff and first line of the Orbison song can be considered the “heart” of the work, 2 Live Crew’s taking of that “heart” was necessary to conjure up the image of the Orbison song in the parody. In order to make a parody recognizable as such, the author must take enough of the original work to allow a listener or reader to make the connection to the original. In some cases, such as this one, this can mean that the parody goes to the “heart” of the original work without constituting infringement. Indeed, the Court finds that 2 Live Crew took no more than was necessary for its parody, and that this was not an excessive amount. (4) Given their differences both lyrically and in terms of genre and likely audience, 2 Live Crew’s song will have a very minimal impact on the market for Orbison’s original song. However, Acuff-Rose has the exclusive right to create derivative works of the Orbison song, and nothing in the record is indicative of the 2 Live Crews song’s effect on the market for a non-parody, rap version of Orbison’s song. This is a hole in the record that must be filled on remand. As a result of the foregoing, the Court holds that the Sixth Circuit erred by finding that the 2 Live Crew song’s “blatantly commercial purpose” prevented it from being a fair use, and that 2 Live Crew copied too much of Orbison’s song to constitute fair use. The Sixth Circuit is reversed and the case is remanded.
Authors Guild v.Google Inc, U.S. Supreme Court, No. 15-849
Issue: The publishing industry and writers' groups have criticized the project's inclusion of snippets of copyrighted works as infringement. Publishers maintain that Google has no right to copy full text of books with copyrights and save them, in large amounts, into its own database.
Rule of Law: “Fair use” (Fair use is a doctrine in the law of the United States that permits limited use of copyrighted material without having to first acquire permission from the copyright holder.)
Holding: dismissed the lawsuit, and affirmed that the Google Books program meets all legal requirements for "fair use
Authors Guild v Google Inc (US Supreme Court) 2016 – SCOTUS denied to review decision because lower court right
Issue: Whether Google Books constitutes “fair use” of petitioners’ copyrighted works within the meaning of factors set forth in 17 USC s107.
Held: Google Books met all the requirements for fair use. Met all four traditional factors for fair use.
- For possible economic damage, Google books in fact aid in sales.
- There’s a public interest, promotion of the arts, etc
Four factors all met: 1. Purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes; 2. The nature of the copyrighted work; 3. The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and 4. The effect of the use upon the potential market for or value of the copyrighted work.
Rule of Law
The fair-use defense to a copyright-infringement claim applies if a party copies books to a searchable online database but allows users to view only small portions of the books.
Google, Inc. (defendant) launched the Google Book Project. The project involved bilateral agreements between Google and research libraries. The libraries would select books from their collections to submit to Google for inclusion in the project. Google made a digital scan of each book and indexed them online. Users could go to the Google Books website and search for terms within the books. Users could also pull up a limited viewing of small portions of the books’ text. The libraries were allowed to download full copies of the digital images of the books they submitted to Google. Authors Guild (plaintiff) is an association of authors of copyrighted books that sued Google for copyright infringement for the Google Book Project work.
Does the fair-use defense to a copyright-infringement claim apply if a party copies books to a searchable online database but allows users to view only small portions of the books?
Holding and Reasoning (Leval, J.)
Yes. A party has a fair-use defense to a copyright-infringement claim if it copies books to a searchable online database but allows users to view only small portions of the books. A fair use of copyrighted material is a defense to a copyright-infringement claim. When considering a fair-use defense, a court must take into account: (1) the purpose and character of the use, (2) the nature of the copyrighted work, (3) the amount used in relation to the copyright as a whole, and (4) the effect of the use upon the potential market for the work. A work may be considered fair use under the first factor if the new work is transformative, meaning that it communicates something new and different from the original. A finding of fair use is more likely if only small amounts of the original work are copied. However, complete, unchanged copying is justified as fair use if the copying was reasonably appropriate to achieve the copier’s transformative purpose. The fourth factor focuses on whether the copy is a competing substitute for the original in a way that deprives the copyright owner of significant revenue. In this case, Google’s copies were made for a highly transformative purpose. Making a digital copy of copyrighted books that allows users to search for terms of interest is the type of transformative use this factor was meant to address. Although Google has a profit motivation in the project, that motivation should not be used to deny fair use in light of this highly convincing transformative purpose. As to the second factor, courts have rarely found that this factor plays a large role in deciding fair use, and it does not here. As to the third factor, copying entire books was necessary for Google’s transformative use. Additionally, Google only made a small portion of the works available to the public. Thus, looking at the fourth factor, it is unlikely that Google has created a copy that would compete with copyright owners. Accordingly, Google’s copying constitutes an fair, non-infringing use. Google’s agreement to give copies of the works to the libraries, to be used for the same purposes as the Google Books Project, is also non-infringing.
Rule of Law
Fair use is not a defense to copyright infringement if the infringer sells the copyrighted works for profit without the copyright holder’s consent.
Google Inc. (defendant) scanned millions of books into an electronic database designed for use by research libraries. Google made snippets of book text available for online searching. Though many of the books were under copyright protection, Google did not obtain permission from the copyright owners to scan them. In 2005, various authors and publishers (plaintiffs) brought a class-action lawsuit against Google, claiming that Google’s use of the snippets constituted copyright infringement. Google claimed fair use as a defense under the § 107 of the Copyright Act, which allows the unauthorized use of copyrightable work for purposes such as scholarship and research. The court approved an Amended Settlement Agreement (ASA) in 2009. Among other things, the ASA allowed Google to sell access to an electronic-books database, share revenues with copyright holders, and establish a registry to distribute revenue from sources including orphan books and other unclaimed works. The ASA required Google to obtain prior, express authorization from copyright holders to use in-print books, but not out-of-print books. The ASA also allowed copyright holders to opt out of the database upon request. Several class-action members objected to Google’s ability to use copyrighted works without obtaining prior, express authorization. The plaintiffs filed a motion under Rule 23 of the Federal Rules of Civil Procedure (FRCP) for final approval of the class-action settlement under the ASA’s terms.
Is fair use a defense to copyright infringement if the infringer sells the copyrighted works for profit without the copyright holder’s consent?
Holding and Reasoning (Chin, J.)
No. Fair use is not a defense to copyright infringement if the infringer sells the copyrighted works for profit without the copyright holder’s consent. A copyright holder’s right to exclude others from the copyrighted work is fundamental. Rule 23(e) of the FRCP allows a court to approve class settlements that are fair, adequate, and reasonable. In this case, the ASA does not meet these requirements. First, neither the court nor private, self-interested parties have the authority to determine guardianship of unclaimed works. Congress has this authority and has made efforts to enact orphan-works legislation. Second, the ASA grants Google rights that exceed the scope of the pleadings. Though this case challenges Google’s right to use snippets of text, the ASA grants Google the right to make full books available online for purchase. Google did not scan the books to make them available for this purpose. Google also has no valid defense to an infringement claim based on the unauthorized copying and selling of entire, copyright-protected books. Third, the class representatives who are seeking approval of the ASA do not adequately represent the interests of the entire class. The ASA would force class members to give up rights to copyrighted works, and the members’ silence would be interpreted as consent to Google’s use of the works. Finally, the opt-out provisions do not adequately protect the copyright holders. Placing the burden on copyright holders to opt out in order to protect copyrighted works is inconsistent with the purpose of copyright laws, which is to promote creative works by giving copyright holders an exclusive right to copyrighted works. Also, some authors will be unaware of the need to come forward. The parties should consider addressing the ASA’s issues by converting the opt-out option to an opt-in option. The motions for the ASA’s final approval, attorneys’ fees, and costs are denied, without prejudice.
Nadia Plesner Joensen v. Louis Vuitton Malletier SA, Court of The Hague,
Decision of May 4, 2011, KG ZA 11-294 (unofficial translation)
express of artistic criticism which is allowed convention on human rights
Pebble Beach Company v. Michael Caddy, 453 F. 3d 1151 (9th Cir. 2006)
Facts: Michael Caddy is a small business owner of Pebble Beach Restaurant in the UK. Sued by California Pebble Beach Resort for trademark infringement. Caddy’s website is called . The website is in GBP and does not have a reservation system, nor does it allow guests to book rooms online. Pebble Beach US argues that the tortious conduct was directed at California and the US.
Issue: Whether the district court in the USA has personal jurisdiction over Caddy.
Held: Because Caddy did not expressly aim his conduct at Cali or US, American district court lacked personal jurisdiction.
- When a D moves to dismiss for lack of personal jurisdiction, the P bears the burden of demonstrating that the court has jurisdiction over the D
o Personal jurisdiction is granted if long-arm statute permits it and if that jurisdiction does not violate federal due process
o However, for due process to be satisfied, defendant must have “minimum contacts” with the forum state such that assertion of jurisdiction “does not offend traditional notions of fair play and substantial justice”
♣ 3 part test for minimum contact, which is satisfied when:
♣ 1. Defendant performed some act or consummated some transaction within the forum or otherwise purposefully availed himself of privileges of conducting activities in the forum/purposefully directed his activities toward the forum
♣ 2. Claim arises out of events from forum-related activities
♣ 3. Exercise of jurisdiction is reasonable
Application of the test for a California district court
- Step 1: All of Caddy’s action takes place outside the US forum. Rejects argument that Caddy availed himself of the jurisdiction of the US district court.
- Step 2: Regardless of foreseeable effect, the website was not targeting California
- Caddy was not cybersquatting either
- Essentially a passive website where customers can go on, and as such there is no personal jurisdiction
- There needs to be “something more”
- Similar to Schwarzenegger case because it involves passive advertisements with not targeting in that particular state
Application of test to United States in general:
- Long arm statute satisfied. However, use of .com by a non-resident is not enough to show targeting US customers
Michael Caddy (defendant), a resident of England, owned and operated a bed and breakfast that he named Pebble Beach due to its location overlooking pebbly beaches on the south shore of England. He operates a website for the bed and breakfast at www.pebblebeach-uk.com. The website was not interactive and did not have a reservation or allow guests to book rooms or pay for anything related to the bed and breakfast online. Pebble Beach Company (Pebble Beach) (plaintiff) was a well known golf resort in California. It operated a website for the resort at www.pebblebeach.com. Caddy had been to California and was aware of the golf resort. Pebble Beach sued Caddy in California for trademark infringement. Caddy filed a motion to dismiss based on lack of personal jurisdiction and the district court granted his motion. Pebble Beach appealed.
Does operating a passive, non-interactive website with no direct ties to a forum state constitute conduct sufficiently aimed at the forum state to warrant grant of personal jurisdiction?
Holding and Reasoning (Trott, J.)
No. To meet due process requirements in the assertion of personal jurisdiction, a defendant must have certain minimum contacts with the forum state. For a plaintiff to establish those minimum contacts, it must show that each part of a three part test is satisfied. For purposes of this case only the first part is relevant: the plaintiff must show that the defendant’s conduct was within the forum, or that the defendant either “purposefully availed” himself of the privileges of conducting business in the forum or “purposefully directed” his conduct toward the forum. In this case, Caddy’s conduct was not in California and he did not purposefully avail himself of the privilege of conducting business in California so only the “purposefully directed” test is relevant. To satisfy the first part of the minimum contacts test under the purposefully directed prong, the defendant must have committed an intentional act, which was expressly aimed at the forum state, and caused harm, the brunt of which is suffered and which the defendant knows is likely to be suffered in the forum state. Here, it cannot be said that Caddy’s actions were expressly aimed at California. He merely operated a non-interactive website with no opportunity for California residents to book reservations online. A passive website—even with a similar domain name—without more does not constitute express aiming. Accordingly, Pebble Beach cannot meet the first part of the minimum contacts test and therefore cannot establish that Caddy has sufficient minimum contacts with California to warrant assertion of personal jurisdiction. The district court’s granting of Caddy’s motion to dismiss is affirmed.
Peter Pinckney v. KDG Mediatech AG, ECJ Decision of October 3, 2013,
Peter Pinckney v KDG Mediatech AG (ECJ 2013) – Art 5(3) of EC Reg 44/2001 confers jurisdiction for copyright infringements, but only for determining the damaged caused in the Member State within which it is situated
Facts: Pinckney (French resident) sued KDG Mediatech (Austrian company) for copyright infringement over his alleged songs that were sold on CDs pressed in Austria then marketed by UK companies. Mediatech challenged the court in Toulouse’s jurisdiction.
Issue: Concerns Article 5(3) of European Council Regulation 44/2001 (that any person domiciled in a Member state may sue in another member state)
Held: Article 5(3) grants jurisdiction for an author of a work against a company established in another Member State, in the event of alleged infringement of copyrights protected by the Member State of the court seised by the author.
- However, that court only has jurisdiction to determine the damaged caused in the Member State within which it is situated
- Article 5(3) of the Regulation is intended to cover both the place where the damage occurred and the place of the event giving rise to it, so that the defendant may be sued, at the option of the applicant, in either courts (Melzer)
- For the purpose of identifying the place where damage caused by the internet occurred, the Court has distinguished between infringements of personality rights and infringement of intellectual and industrial property rights (eDate Advertising)
o For personality rights cases, P can bring suit in each of the Member States
For intellectual and industrial property rights, case must be brought in the territory of the Member State of registration which are best placed to ascertain whether the right at issue has been infringed
Lucasfilm Ltd Ors v. Ainsworth Anor  EWHC 1878 (Ch)
Start wars helmet, infringement of copyright, enforcement in another UK jurisdiction.
Gesellschaft für Antriebstechnik mbH Co. KG v. Lamellenund
Kupplungsbau Beteiligungs KG, ECJ Decision of July 13, 2006, Case C4/03
patent should be treated in right jurisdiction
eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006)
Facts: Agreement between MercExchange (P) and eBay/Half.com (D) not reached. Ordinarily the P licenses its business method patent to eBay. Now P sues D for patent infringement.
Issue: Whether permanent injunctions can be granted for patent infringement disputes
Held: The permanent injunction’s four-factor test employed by courts of equity is used for Patent Act.
A plaintiff seeking a permanent injunction must satisfy a four-factor test before a court may grant one. P must demonstrate that
1. It has suffered an irreparable injury;
2. That remedies available at law, such as monetary damages, are inadequate to compensate for that injury;
3. Considering the balance of hardships between the P and D, a remedy in equity is warranted;
4. That the public interest would not be disserved by a permanent injunction
The Patent Act follows these principles as well. It is because patents are similar to property rights. Excludes others from using his property (Fox Film Corp v Doyal)
**Paper Bag Co v Eastern Paper Bag Co (1908) rejected the contention that a court of equity has no jurisdiction to grant injunctive relief to a patent holder who has “unreasonably declined to use the patent.” [on basis of purportedly failing the irreparable harm step]
District Court erred for categorical denial of injunctive relief. Court of Appeals erred by its categorical grant of such relief (erred in stating that injunctions are only denied in unusual or exceptional circumstances).
Georgia-Pacific v. US Plywood Corp, 446 F2d 295
Georgia-Pacific Corp v US Plywood-champion Papers Inc (1971 2nd Circuit) – Reasonable Royalty case – lists 15 factors for finding what a reasonable royalty is
Facts: Georgia Pacific Corp was ordered to pay damages for patent infringement to US Plywood.
Issue: What is a reasonable royalty?
Held: Yes, there was patent infringement. However, award reduced.
- “GP deliberately duplicated Weldtext and put itself in direct competition with USP in spite of its own counsel’s warning that an expensive suit was inevitable.”
o USP here is only recovering a reasonable royalty so GP can still retain profits
United States District Court, Southern District of New York
318 F.Supp. 1116 (1971)
Rule of Law
Determining what constitutes a reasonably royalty for a patent license, where a party has been found to be infringing another party’s patent, involves the weighing of several factors, and is within the discretion of the district court.
Georgia-Pacific (plaintiff) sought declaratory judgment of non-infringement and invalidity of a patent owned by United States Plywood (defendant), which counterclaimed for infringement. After Georgia-Pacific prevailed at trial, the decision was reversed and remanded on appeal. Back at the District Court level, the Court was tasked with determining a proper damages amount for United States Plywood, which was delegated to a special master, which is an officer of the court to whom certain duties are delegated based on their particular expertise. Disagreeing with the special master’s calculations, the District Court enumerated several factors to determine a proper measure of damages.
How is a reasonable patent royalty determined, where a party has been found to be infringing another party’s patent?
Holding and Reasoning (Tenney, D.J.)
The district court must weigh a series of factors to determine what it believes is a reasonably royalty. Among these factors, the court pointed to fifteen in particular: (1) royalties received by the patentee from others; (2) royalties paid by the infringer for similar patents; (3) whether the license is limited in any way; (4) other licensing behavior by the patentee; (5) the relationship of the parties; (6) the relative value of the patented article to the rest of the infringer’s sales portfolio; (7) length of the license; (8) the commercial success of the product; (9) the improvements in the patented product over prior products; (10) the nature of the invention itself, particularly in light of the infringer’s other products; (11) the breadth of the infringing activities; (12) the typical royalty charged per profit for the invention; (13) the royalty rate for the sale of the product rightly attributed to the patent as opposed to the other unpatented parts of the product; (14) expert opinions; and (15) a reasonable royalty rate if the parties had originally been willing to negotiate a license.
Ville de Paris v Jeff Walter, WIPO Arbitration and Mediation Center, WIPO
Case No. D2009-1278
Ville de Paris v Jeff Walter (WIPO Case No D2009-1278)
Facts: City of Paris (Complainant) obtained French trademark registration for provision of wifi services in the city. Walter (Respondent) registered the disputed domain name “PARVI” later. Respondent said he registered in good faith not knowing the trademark, means “small” in Latin and it was for a social networking site.
Issue: Does the absence of bad faith intent by the respondent at the time of acquisition of the disputed domain name inevitably preclude the complainant from succeeding under the Policy, even though the R has subsequently used the domain name in bad faith?
Held: Respondent was in the wrong. Pursuant to Paras 4(i) of the Policy and 15 of the Rules, panel orders R to transfer domain name to the C.
Reasoning: R did not demonstrate that he registered domain name for a proposed social networking site. Parvi is also not Latin for small, it is parvus.
- There were no “demonstrable preparations to use” the disputed domain name for the asserted purpose
- R does not have rights or legitimate interests in the disputed domain name
Complainant must prove that the disputed domain name “has been registered and is being used in bad faith” (Para 4(a)(iii) of the Policy)
- Octagon Trio of Cases: looked at whether registered in good faith but used in bad faith met the requirement of para 4aiii of the Policy
o Yes, bad faith can be deemed to have occurred if later on it’s used in bad faith
o The obligation to not use the domain name imposes a duty to investigate at time of registration AND now or in the future
Therefore, could be deemed retroactive bad faith registration
Jeffrey Walter v Ville de Paris, U.S. D. C. Southern District of Texas,
Houston Division, 14 September 2012 (civil action NO. 4:09-CV-3939)
Jeffrey Walter v Ville de Paris (US DC Southern District of Texas, Houston Division) 14 Sept 2012
Successful judgement for Walter. Domain name transferred back to Walter. Paris to pay Walter for tortious interference.
Capitol Records, LLC v. ReDigi Inc., No. 12 Civ. 95 (RJS), slip op. at 1
(S.D.N.Y. Mar. 30, 2013)
United States District Court for the Southern District of New York
934 F. Supp. 2d 640 (2013)
Rule of Law
The first-sale doctrine does not apply to digital-music files.
ReDigi Incorporated (ReDigi) (defendant) operated a website that allowed users to sell copies of legally acquired digital-music files to other ReDigi users. The music files had to be purchased through iTunes or other registered sellers of digital-music files, and could not be copied from a CD or illegally downloaded. ReDigi’s platform required the users to download software that evaluated the music files on the computer to ensure they were legally purchased digital files. Applicable files could then be uploaded from the user’s computer to ReDigi’s servers and either used by the owner or sold to another user. Once the file was sold, the original owner no longer had access to the digital file. Capitol Records, LLC (Capitol Records) (plaintiff) owned the copyright in some of the musical works in the digital-music files sold on ReDigi’s suit. Capital Records sued ReDigi, alleging violation of the Copyright Act. Capitol Records filed a motion for partial summary judgment on claims of direct and secondary infringement, arguing that ReDigi’s business model clearly violated Capitol Records’s reproduction and distribution rights in the underlying musical works.
Does the first-sale doctrine apply to digital-music files?
Holding and Reasoning (Sullivan, J.)
No. The first-sale doctrine does not apply to digital-music files. The Copyright Act provides copyright holders with the exclusive right to reproduce protected works. A work is reproduced if the work is fixed in a new physical object. When digital-music files are transferred to a new device, the files are removed from the initial physical object, a computer’s hard drive, and sent to a new physical object, a different hard drive or memory source. As a result, each transfer constitutes a reproduction of the copyrighted work contained in the digital file. The Copyright Act also provides copyright holders with the exclusive right to distribute protected works under 17 U.S.C. § 106(3). However, an affirmative defense exists for claims of an infringement of the exclusive distribution right. Under 17 U.S.C. § 109(2), otherwise known as the first-sale doctrine, a copyright holder does not retain distribution rights to individual copies once they are legally sold. However, because digital music cannot be legally distributed by transferring the files to another physical object, because that act constitutes an unlawful reproduction, the requirements of the first-sale doctrine do not apply. This does not mean that digital works are completely excluded from § 109(a), and resale of the iPod or computer to which the files were originally downloaded are protected by the first-sale doctrine. Protection of further sales of physical goods satisfies the legislative intent of Congress, which recognized that physical works degrade over time and thus have a different market than new, pristine works. It is Congress’s place to change the statute if the statute is outdated. Here, ReDigi’s platform involves transferring the original purchaser’s files from their initial, fixed medium to the ReDigi servers and ultimately to the final purchaser. The file is transferred to new physical objects, and therefore the transfer constitutes an infringement of Capitol Records’s reproduction rights. Further, because the ReDigi platform infringes Capitol Record’s reproduction rights, the platform does not lawfully distribute the digital-music files, and the first-sale Doctrine does not apply. It is uncontested that distributions of copyrighted works occurred. Accordingly, the sales also violate Capitol Record’s distribution rights. Capitol Records’s motion for partial summary judgment is granted.
Nils Svensson, Sten Sjögren, Madelaine Sahlman, Pia Gadd v Retriever
Sverige AB, ECJ Decision of February 13, 2014, Case C-466/12
Nils Svensson et al v Retriever Sverige (2014 ECJ) - clickable links that redirect to works freely available on another website are no infringements; do not constitute an “act of communication to the public”
Facts: Svensson et al (P) claim they suffered harm concerning compensation they should have received from Retriever Sverige AB (D) as a result of the inclusion on that company’s website of clickable Internet links (hyperlinks) that redirected users to press articles in which the applicants hold copyright.
1. If anyone other than the holder of copyright supplies a clickable link to the work on his website, does that constitute communication to the public within the meaning of Art 3(1) of Directive 2001/29?
a. If so, yes infringement because only rightholder can communicate to the public.
2. Is the assessment under Q1 affected if the hyperlink can be accessed by anyone without restrictions or if access is restricted in some way?
3. Does it matter if hyperlink to original site, or link that gives impression that it is appearing on the same website?
1. Can MS give wider protection to authors’ exclusive right by enabling communication to the public to cover a greater range of acts than provided for in Art 3(1) Directive 2001/29?
Held: The act of communication (the links to the original site) had no new public created. No infringement.
Art 3 of Dir 2001/29 has two reqs: 1. An act of communication and 2. Communication of that work to the public
In this case, a clickable link does not lead to the works in question being communicated to a new public. All visitors to the site did not face restrictions, and all Internet users could therefore have free access to them.
- Visitors are DEEMED potential recipients of the initial communication
Art 3 of Directive 2001/29 (Information society): Right of communication to the public – MS shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them
- Art 3(3): rights shall not be exhausted by act of communication to the pubic as set out in this Article
BestWater International GmbH v Michael Mebes and Stefan Potsch, ECJ
preliminary ruling of October 21, 2014, Case C-348/13
- BestWater – if freely available no issue, but if uploaded then that’s a new public and therefore infringement
- Embedding not a copyright infringement
The insertion of another website via a link using the technique of “transclusion” (“framing”) is not a “communication to the public” within the meaning of Article 3, Paragraph 1 of Directive 2001/29/EC and therefore does not violate the sole rights of the copyright holder.
BestWater International (‘BestWater’) manufactured and marketed water filtration systems and produce a short two minute film about water pollution over which it had exclusive exploitation rights. This video was posted to YouTube which BestWater said was done without its consent. Mebes and Potsch were independent sales agents for a competitor of BestWater. They each had a website where they promoted their clients products and these websites allowed visitors to view the film produced by BestWater through a clickable link that using the technique of “transclusion” or “framing” whereby when users clicked the link, the film created by BestWater on YouTube would pop up and appear on their website giving the impression it was created by Mebes and Potsch. BestWater therefore brought an action to obtain stop its use and seeking damages.
The court of first instance decided for BestWater and ordered the defendants to pay €1,000 in damages and to reimburse €555.60 in development costs. The appellate court reversed the trial courts decision ordering equal distribution of costs. BestWater appealed this decision to the Bundesgerichtshof Court which noted, in particular, that where work has already been the subject of a “communication to the public” within the meaning of Article 3(1), then a new act of communication performed according to the same technique can not be described as “communication to the public” under this provision based only on the fact that the act is applied to a new audience. The Bundesgerichtshof Court observed that the technique of “transclusion” allowed the manager of a website to appropriate a work, while avoiding having to copy it and therefore avoiding falling into the scope of the provisions concerning the right of reproduction. The Bundesgerichtshof decided to stay proceedings and referred to the ECJ the following question:
“Can the work of a third party made available to the public on a website or inserted on another Internet site in circumstances such as those at issue here be called a ‘communication to the public’ within the meaning of Article 3(1), even when the work in question is not transferred to a new public nor communicated in a different technical mode than the original communication?”
The court held that whenever and as long as a work is freely available on the site pointed to by an internet link, it must be considered that when the copyright holders authorised the communication, they took into account all internet users as the public.
In conclusion, it was held that the mere fact that a protected work, which is freely available on an Internet site, is inserted on another website via a link using the technique of “transclusion” (“framing”), as in this case, it can not be described as a “communication to the public” within the meaning of Article 3(1), to the extent that the work in question is not transferred to a new public nor communicated following a specific technical mode that is different to the original communication.
Asphalt Jungle II, French Supreme Court (Cour de Cassation), Decision of
28 May 1991, IIC 1992, 702_
Asphalt Jungle II (1991) French Cour de cassation
- About D making a colourized version of the film Asphalt Jungle
- Integrity of literary or artistic work in France: person who is the author of the work is entitled to claim droit moral (moral right) merely due to the actual creation of the work, independent of the state in which the work was first published
Pharmon BV v. Hoechst AG, ECJ Decision of July 9, 1985, Case C-19/84 _
Issue: Exhaustion and Compulsory Licence? Patents: also regional exhaustion. It was a compulsory licence granted for a specific patent product, the beneficiary wanted to resell the patented product in the UK. A compulsory licence is a licence granted by local authorities to 3rd parties when there are specific needs (public health issues (produce generics urgently) or because of a refusal because of competition advantages). Here, it was also a question of exhaustion because the UK company that was granted this licence benefitted from the lower price and tried to resell in the EU, there’s no exhaustion because there’s a specific need and it applies to one territory only, the UK and not beyond.
1 . ARTICLES 30 AND 36 OF THE EEC TREATY PRECLUDE THE APPLICATION OF NATIONAL PROVISIONS WHICH ENABLE A PATENT PROPRIETOR TO PREVENT THE IMPORTATION AND MARKETING OF A PRODUCT WHICH HAS BEEN LAWFULLY MARKETED IN ANOTHER MEMBER STATE BY THE PATENT PROPRIETOR HIMSELF , WITH HIS CONSENT , OR BY A PERSON ECONOMICALLY OR LEGALLY DEPENDENT ON HIM .
2.ARTICLES 30 AND 36 OF THE EEC TREATY DO NOT PRECLUDE THE APPLICATION OF LEGAL PROVISIONS OF A MEMBER STATE WHICH GIVE A PATENT PROPRIETOR THE RIGHT TO PREVENT THE MARKETING IN THAT STATE OF A PRODUCT WHICH HAS BEEN MANUFACTURED IN ANOTHER MEMBER STATE BY THE HOLDER OF A COMPULSORY LICENCE GRANTED IN RESPECT OF A PARALLEL PATENT HELD BY THE SAME PROPRIETOR . IN THAT RESPECT , IT MAKES NO DIFFERENCE WHETHER A PROHIBITION ON EXPORTATION IS ATTACHED TO THE COMPULSORY LICENCE , WHETHER THAT LICENCE FIXES ROYALTIES PAYABLE TO THE PATENTEE OR WHETHER THE PATENTEE HAS ACCEPTED OR REFUSED SUCH ROYALTIES .
WHERE A COMPULSORY LICENCE IS GRANTED TO A THIRD PARTY THE PATENT PROPRIETOR IS DEPRIVED OF HIS RIGHT TO DETERMINE FREELY THE CONDITIONS UNDER WHICH HE MARKETS HIS PRODUCT . THE SUBSTANCE OF A PATENT RIGHT LIES ESSENTIALLY IN ACCORDING THE INVENTOR AN EXCLUSIVE RIGHT OF FIRST PLACING THE PRODUCT ON THE MARKET SO AS TO ALLOW HIM TO OBTAIN THE REWARD FOR HIS CREATIVE EFFORT . IT IS THEREFORE NECESSARY TO ALLOW THE PATENT PROPRIETOR TO PREVENT THE IMPORTATION AND MARKETING OF PRODUCTS MANUFACTURED UNDER A COMPULSORY LICENCE IN ORDER TO PROTECT THE SUBSTANCE OF HIS EXCLUSIVE RIGHTS UNDER HIS PATENT
GS Media BV v Sanoma Media Netherlands BV e.a., Decision of
September 8, 2016, Case C-160/15
- Infringement if links are provided for financial gain + person knew or reasonably could have known the illegal nature of the publication of that work
- Court held 1. Need creation of new public, and 2. person needs to know that the content was illegal such that person has a commercial interest in the new website
Facts: Playboy sues GS Media for posting hyperlinks to other websites enabling photographs of Ms Dekker that were originally taken for Playboy magazine.
- GS Media posted the photos of nude Dekker on their website, with links to the files which were hosted on a Filefactory website
Issue: Concerns the interpretation of Art 3(1) of Directive 2001/29 and the communication to public right for copyright rightholders.
- Is there infringement if content has never been communicated before?
- Is there infringement if the website to which the hyperlink refers is not easily findable without help?
- Whether there is infringement depends on whether the links are provided without the pursuit of financial gain by a person who did not know or could not reasonably have known the illegal nature of the publication of those work on that other website
- There is infringement if knowledge of the illegality of the content could be presumed.
Application: GS Media clearly at wrong at all steps. Knew of illegality, was for profit, and no consent from Sanoma/Playboy.
Court held 1. Need creation of new public, and 2. person needs to know that the content was illegal such that person has a commercial interest in the new website
- Consent of original copyright holders important
- This case is distinguishable from Svensson because there is no consent here. “Communication to the public” should be given expansive reading and should capture these scenarios where there is communication to a new public
- Presumption of due diligence to check legality of content
Application: GS Media clearly at wrong at all steps. Knew of illegality, was for profit, and no consent from Sanoma/Playboy.
Fredrik Neij and Peter Sunde Kolmisoppi (The Pirate Bay) v. Sweden,
ECHR, Decision of 19 February 2013
Louis Féraud International Sàrl / Pierre Balmain v. Viewfinder Inc., 489
F.3d 474 (2nd Cir. 2007)