Sunday, December 11, 2011

Apple Just Keeps Getting It Wrong

Don't misunderstand, I think Apple is a great company and they sure do know how to innovate when it comes to personal gadgets. But they really need some improvement in the due diligence area. We've sued Apple a couple of times before because someone dropped the ball when they made a couple of television ads and didn't check to make sure they had the right to use some copyrighted works in those ads. Apple is a litigious company, so they blamed someone else and then fought the case on ridiculous grounds rather than just owning up to their mistake. Apple gets strong indemnification agreements whenever they make a television ad, so I don't think they really care how much it costs to defend the case. They just hate to admit they did anything wrong.
Now it's happened again. Apple began anonymously buying the rights to the "IPAD" trademark around the world. They did this in about 2006, just before releasing the iPad. Apple thought they got the rights in every country, but they missed one. They didn't buy the one that was registered in China way back in 2000 to a Taiwanese company. Oops. Now, Apple is suing the company that owned the mark 5 years before Apple even got interested. Why? Because Apple says it had a contract with the parent company to buy that mark too. Apparently they didn't do their due diligence again. Someone over at Apple missed the fact that the company they bought the IPAD trademark from in China didn't actually own it. Oops. Apple goofed. So in typical fashion for huge multi-national corporations drunk on their own money, they sued the company who owns it to try and get it. How medieval. Apple wants something, so they just go take it. Or at least they try. Sounds like the Chinese courts are less smitten with Apple than the general U.S. population. Ownership of the IPAD mark in China is still squarely in the hands of Proview, and they are not about to give it up. After mentioning that they have been having some financial problems, Proview has suggested that they might still be willing to part with the mark. But now that they know Apple wants it, the question is: "How much?"

Wednesday, December 7, 2011

Email is Bad: Don't Use It!

It looks like Grooveshark Chairman Sina Simantob is learning a valuable but painful lesson about what should and should not go into email. Mr. Simantob committed a cardinal sin, he put a bunch of incriminating stuff in emails that he never thought anyone would ever see. I'm more than certain he regrets every word of every one of those email messages. And he's not the only one. There are countless examples of careless emails coming back to haunt people.
So what do you do? Stop using email.
Crazy, you say? Well maybe it's just crazy enough to work.
A French technology services company is banning email, at least internally. Atos has formally decided what I have long believed: email is so bad it should stop. Atos adopted a policy that it will no longer allow its employees to communicate internally by email. Instead, Atos employees will have to communicate face-to-face (imagine that) or by instant messaging. Collectively, employees will create work using the "wiki" style of collaborative document creation.
This is great. It appears to be catching on and getting positive feedback. Personally, I hate email. It's impersonal and prone to abuse or misinterpretation. You don't get any incidental feedback like you do when you talk to someone--like a smile that says "I'm joking." Sure, people have started to use those silly smiley faces, but that's just dumb. And horribly unprofessional.
So I will soldier on and continue to champion the death of email, at least as a primary means of communication. I would be happy if email just served the same purpose that formal written letters used to serve. People should stop thinking they can shoot off any and every thought that pops in their head in an email just because it's easy. It will come back to haunt you. Just ask Sina Simantob.

Tuesday, December 6, 2011

Software Copyrights Protect More Than Just Code

As I frequently say, software copyrights are the new thing. Since long ago, software patents were viewed as the only vehicle to protect your software against anything except actually selling unauthorized copies of your software. But most people don't remember that until the rise of software patents, which is a relatively new thing, copyright law was the vehicle of choice. Well I believe that choice is being made again, and it should be. Copyright protection has lots of benefits: it's easier to get, cheaper, lasts longer, and gives you more leverage if you have to file a lawsuit.
Oracle has been leading the charge on this front, scoring big wins for copyright infringement. But others are following that lead. The latest case is one filed by Zynga against a Brazillian company named Vostu. Zynga is the company that makes the popular games people play on social networking sites like Facebook. You may know about Mafia Wars or FarmVille. Well, Zynga also make a game called Cafe World. Apparently this game is fairly popular, so the Brazillian game maker Vostu decided they would knock it off. Now Vostu did not break in to the Zynga offices at night and steal the code, nor did they download "copies" of the game and start serving up their own versions. Rather, Vostu did what most software developers do who want to knock off a popular competitor: they wrote a new game that looked just like Cafe World. Vostu even called it Cafe Mania. No similarity there.
Here is a side-by-side comparison of the two games:
software copyrights protect user interface
Now you tell me, is Cafe Mania a copy of Cafe World? The similarities between the two games drastically outweigh any differences. Clearly, this is a knock off in my opinion. The copyright laws exist to protect exactly this kind of copying. I'm not saying only this kind of copying, but definitely this kind of copying.
The real difficulty in making money in software, and gaming in particular, has nothing to do with writing code. Anyone can write code. The difficulty in making money in software is providing users with an application that they like. People play games because they like playing those games. People don't play games because the games have well written code, they play games that have well-done user interfaces and inviting graphics. Software success doesn't turn on whether the end user likes your code, it's whether the end user likes what he sees on the screen.
Against that backdrop, isn't it most important to protect the part of your code that sells it? One of the most important considerations, at least for a fair use analysis, is how has your copy affected the original author's ability to make money on the original work. If all a software developer does is wait until its competitor comes up with the magic formula for a successful game, and then writes new code to mimic that game, that is copyright infringement. The expression of the code is what the user sees on screen, not the words that appear in source code. Copying the product of the software should not avoid copyright liability just because you used different materials to construct the same end result. Protecting the expression of the source code the same way you would protect the source code itself is the only way to provide meaningful protection to software developers.
This is not a novel concept. In the furniture industry, copyright protection is used all the time to protect furniture. In those cases, a furniture company comes up with a visually-pleasing design for a table or a rug, so someone else knocks that design off. Invariably, the knock off is made of inferior materials and workmanship. So what is being protected? Is it the underlying materials used to embody the artist's vision? Or is it the physical expression of that vision separate from the underlying materials? I would say it is the latter.
Copyright protection is supposed to protect the expression of the author's idea, not the particular medium used to express that idea. I say that software copyrights are an idea whose time has come. More software developers need to be following Oracle's and now Zynga's lead.

Friday, December 2, 2011

Copyright Piracy OK if You Spend The Money You Saved

Swiss OK copyright piracy so long as money spent in local theaters
The Swiss government has been considering additional legislation to address online copyright infringement. First, when you read an article about copyrights, you know which way the author leans by whether it's referred to as "copyright infringement" or "copyright piracy." The hardcore ones call it "copyright theft." The worse you make it sound, the more likely someone is to take your side. I expect to see "copyright murder" soon. But I digress.
The Swiss government was pressed to adopt some stronger online copyright protection laws, much like the U.S. is considering with SOPA. After reviewing several reports and studies, the Swiss government basically found that it would not be in the best interests of the Swiss people to enact stronger legislation. Apparently the justification is that people who download copyrighted content still spend the money they save on other forms of entertainment, like going to the theater.
That's nice, isn't it. The Swiss people are saving money by downloading American music and movies for free, but as long as they spend that money in the Swiss theaters, there's no need to address online copyright protection. I'm being horribly facetious, especially since I think we (the U.S.) already go too far trying to prevent online copyright infringement. Still, there is something oddly charming about the Swiss just putting it right out there like that.
On a completely unrelated matter, I'm thinking about organizing some support to soften the U.S. laws against chocolate piracy.

Wednesday, November 30, 2011

Fair Use Defense to Copyright Infringement: What it is and what it isn't

As a copyright lawyer, I hear a lot of people say "as long as I don't copy more than 10% of something, it's fair use." Or sometimes you hear them say "as long as I change something, it's fair use." These people are destined for trouble.
The "fair use" defense to copyright infringement is actually pretty subjective and definitely not a bright-line test. What does it mean to be a fair use? No one can tell you exactly, at least not in the abstract. It all depends on the particular facts. What I can tell you, is there is no "10% rule."
The fair use defense is part of the copyright laws-Section 107 of the copyright laws to be exact. In short, whether a copy is a fair use basically turns on four things:
  1. Is the copy being sold?
  2. How "artistic" is the work?
  3. How much did you copy?
  4. Did you impact the original author's income?
This is a gross generalization of the four statutory factors that the Courts will always apply, but it's pretty close. So before you make a copy of someone else's work, ask yourself those four questions. I will tell you, the biggies are question 1 and question 4. Not surprisingly, the Court's get very testy when you mess with someone's money. If you are selling the copy to the same people who would be buying the author's work, forget about it. You're done. If you are giving away copies to people who would otherwise be buying the author's work, you're in trouble. If all you are doing is quoting a few passages in your blog of a news article you read, and you don't make any money off your blog, you're probably OK.
So really, fair use is very fact specific. But if you just think about it in terms of those 4 questions, you can probably figure it out for yourself.

Tuesday, November 29, 2011

Grooveshark v Universal: Can you believe some people?

Grooveshark is an online music community that lets users search for, stream, and upload music. I think it is essentially trying to be like Facebook for music. Since there is music involved, naturally UMG sued Grooveshark for copyright infringement. Of course they did.
Ordinarily, this would be just another "music industry sues website" case without much interest really. So ordinarily my sentiments would be with Grooveshark as I abhor the bullying tactics prevalent with the entertainment industry. But the thing that makes this case different is that apparently UMG got ahold of some really incriminating emails that purport to be authored by Sina Simantob, Chairman of Grooveshark. In some of those emails, Sina writes:
The only thing that I want to add is this: we are achieving all this growth without paying a dime to any of the labels
We bet the company on the fact that it is easier to ask for forgiveness than it is to ask for permission
WHAT?!?! Who puts that stuff in email? Are people crazy? It's not like these guys at Grooveshark don't have lawyers, they've been sued before. Didn't someone have the good sense to tell them that anything they put in an email will, undoubtedly, come back to bite them one day? It's one thing to violate the law, it's a completely different thing to brag about it online.
Two things smack me in the face about this:
  1. This guy Sina's confidence about that DMCA safe harbor provision is about to hit a brick wall called karma courtesy of the legal system. Mark my words, those emails alone will kill any defense Grooveshark ever had.
  2. The lawyers for Grooveshark should be fired, then drawn and quartered for allowing emails like this to have ever been created in the first place, and to linger more than 30 seconds in the second place.
Lesson for you people: Don't use email. Just don't do it. But if you must (which is most of us really) absolutely, under no circumstances, ever ever ever write an incriminating email. Ever! You don't think anyone will ever see it, but they will. They will.
Through litigation, I have personally gotten hold of private emails authored by Steve Jobs himself. I bet Steve Jobs never in a million years thought some lawyer in Seattle would one day be reading his email. But I did. And I might be reading yours one day too. So don't do it. Just don't do it.

Friday, November 18, 2011

BMI Copyright Lawyers Frequent Willie's Wet Spot

What those lawyers were doing at the "Wet Spot" is anyone's guess, but they did it frequently. BMI sued Wille's Wet Spot for copyright infringement. The allegation is that the club allowed unauthorized public performances of music that BMI licenses. If you are not familiar with BMI, that is what they do. BMI representatives go around to bars and listen for music that they own rights to, and then they sue the bars for copyright infringement. They've been doing this for a long time.
Nice gig, huh? BMI's agents just go to bars, sit and listen. When they hear a song that's on their list, they write it down. Wonder what kind of songs these BMI guys heard at Willie's Wet Spot. "Baby got back"? "Drop it low"? "Salt shaker"? Apparently, they were so vigilant that they had to return to Willie's four times. Must have seen something that required further investigation.
It's always funny, at least to me, when BMI sues a strip club because I just think how tough those guys have it--getting paid to go to strip clubs and listen to the music, maybe for hours. Being a copyright lawyer can be tough, sometimes.

Thursday, November 10, 2011

Copyright Infringement: Folks Are Going To Jail

Copyright infringement has been around for a long, long time. But it is really becoming a very dangerous idea. The traditional remedy for copyright infringement has always been money. If you copy my stuff, you have to pay me for it. The theory is that, unlike tangible property, you don't really deprive me of my intellectual property--only the value of it. By copying my stuff and selling the copies, you aren't depriving me of my stuff, only the value to me of selling my own stuff (or copies of my stuff). That just seems like a less offensive violation of my rights than, say, breaking in my house and stealing my stereo. It might be the same conceptually, but it just feels different.
But today, things are getting serious. Many, copyright owners are pressing the authorities to pursue criminal charges. For example, Hana Beshara, Matthew Smith, and Justin A. Dedemko of NinjaVideo have all pled guilty to criminal copyright infringement for making copies of movies freely available on the Internet.
Criminal charges are not limited to uploading movies either. Folks are being criminally charged for software copyright violations too, like Robert Cimino from New York and Manpreet Singh of Ohio. Criminal charges aren't even limited to people even. The company SAP has pled guilty to copyright infringement related to the Oracle copyright debacle. I thought crimes could only be committed by people, but I guess I was wrong.
In a recent case, Saidou Dia was sentenced to jail not only for copyright infringement but for failing to register as a sex offender. Now that is good company.
The point that I'm making is the one I have made before: Copyright protection is some of the strongest protection you can get for your intellectual property. Unlike patent law, which is being eroded to nothing by legislation and judicial activism, copyright law seems to be getting stronger and stronger.

Tuesday, November 8, 2011

Apple keeps getting sued for copyright infringement

Apple is in trouble again for copyright infringement. They were recently sued for copyright violations for selling an application through the iStore that extracts pictures from Flickr and then re-publishes them. The application doesn't seek permission in advance, and it even (allegedly) strips any embedded copyright management information.
This is a problem, in general, in several ways. First, re-publishing someone's photographs is absolutely precluded by copyright laws unless you have permission. I don't know what sort of implied or explicit permissions are granted by uploading photos to Flickr, but since suit was filed, I have to assume not many. Second, removing the copyright management information is a DMCA violation. We were (I believe) the first lawyers to succeed on the argument that stripping a photographer's copyright information from a digital picture is a DMCA violation in a case we had a few years back.
This is a problem, for Apple specifically, in a few other ways. First, Apple likely won't be able to hide behind the DMCA "safe-harbor" provision for service providers to escape liability. Apple takes an aggressive role in selecting what applications make their way into the iStore, so they are hardly the type of passive service provider envisioned by that safe-harbor provision. Copyright liability is pretty much strict liability, so if it happened, Apple is probably on the hook. Next, both the copyright act and the DMCA have separate provisions for awarding attorneys fees. Anyone who has litigated copyright cases knows that the difference between a small case and a big case is generally the availability of attorneys fees.
We've had a couple of other cases similar to this one in the past. Based on my experience, Apple should be looking for a reasonable way out of this case.

Tuesday, October 4, 2011

Copyright Protection for Software: Keeps Getting Better

I continue to believe that copyright protection for software is the better legal theory than patent law. Copyright protection is way easier to get, cheaper to acquire, and exists instantly. It also lasts longer, but who uses 70-year old software anyway?
I think my opinion definitely has its supporters. Obviously, the Oracle case against SAP proves that there are big money judgments in software copyright cases. Flushed with its success in the SAP case, Oracle also filed a copyright infringement suit against Google over the Android operating system. That case is ongoing.
In another, more interesting case, SAS Institute sued World Programming for copyright infringement of SAS's software. One of the interesting things about that case is that two things are undisputed:
  • World Programming did not copy any of SAS's source code, and
  • World Programming did copy the unique features of SAS's software.
The reason this is interesting is that, if SAS were to prevail, then this would further support the use of copyright law to protect software in a way that is meaningful. If we are interested in promoting innovation and creativity, why should competitors be allowed to copy the successful software of an original developer? The competitors should be required to develop their own unique software, not copy the popular features of proven software. That is how to promote innovation, not hinder it.
SAS filed two essentially identical cases, one in the U.K. and one here in the U.S. The case here in the U.S. was dismissed because, the district court decided, the U.K. case should take care of the entire dispute. SAS basically lost the case in the U.K. because, the English High Court decided, copyright protection wasn't the right mechanism to protect software. Although on its face that sounds bad for my theory, the reality is that the English High Court did accept that copyright protection is not limited to the source code. In addition, the case is on appeal to the EU Court of Justice, who are being faced with precisely the question whether copyright protection should be applied to the unique features of software.
While some argue it should not be, I disagree with that view. To those who argue that applying copyright law more forcefully to software would "stagnate" the industry, I say nonsense. If software developers are are allowed to just copy someone else's successful product rather than develop their own distinctive software, then who is developing the distinctive software? If they are all copying the same features, then that is the definition of stagnation. I say, to the creative go the spoils of their creations. If all you can do is copy someone else's work, then you should have to pay them their tribute.

Monday, October 3, 2011

Copyright Infringement by State Schools: Authors Guild Might Have a Problem

Alexandra Mackey at the Washington College of Law has written an interesting article about a copyright suit by the Authors Guild against quite a few state universities here in the U.S. Apparently, a bunch of authors, many foreign, are unhappy about a digital archive of library materials including, allegedly, books written by the author-plaintiffs.
Without anything else, this is just another one of the interesting cases about the relative rights of authors versus those who create digital archives of the authors' books. Fair use seems to be the normal defense. The cases against Google are probably the most notable.
The one big difference between the cases against Google and most other defendants is that unlike those defendants, state universities enjoy something called 11th Amendment immunity. Under the 11th Amendment of the U.S. Constitution, a state cannot be sued in federal court for money damages. The only place you can bring a copyright infringement suit is federal court. This means that even if the Authors Guild wins this case, they cannot recover any money for the infringement.
There is lots of law on this, and I'm sure the lawyers who filed the case know this. In fact, I'm certain they do since the complaint they filed doesn't even request money damages, only an injunction. Well, they do ask for attorneys fees, but they probably wouldn't get those either. Still, it's an interesting twist on copyright infringement law.
The case is Authors Guild v. HathiTrust, et al. and was filed in New York.

Sunday, September 25, 2011

Copyright Protection for Software: More Money

I've mentioned before that you should be seriously considering copyright protection for your software either in addition to patent protection, or as an alternative if you don't already have patent protection. Again, you get copyright protection automatically, without the exorbitant expense and delay associated with patent protection. Also, there is the possibility for greater money damages in a copyright suit.
Orace estimates $950 Million in copyright damages
Case in point: Oracle has sued Google for patent and copyright infringement. Basically, Oracle says that Google infringed the copyrights and patents owned by Oracle on the JAVA technology. Actually, Oracle owns those rights because they purchased Sun Microsystems a couple of years ago.
In that suit, Oracle recently submitted its damages estimate. Oracle claims that Google owes roughly $200 million in patent damages, but about $950 million in damages for the copyright infringement. Couple that with the lower standard for recovering attorneys fees in the copyright case versus the patent case, and Oracle stands to gain a substantially greater recovery for its copyright claim than its patent claim. Again, copyright law is proving to be the legal mechanism of choice for protecting software. So if you are considering legal action to protect your software, you should definitely be evaluating whether you have a copyright claim as well. If not, you could be leaving the lion's share of your recovery on the table.

Wednesday, September 21, 2011

Copyright Infringement Damages: Why Is Sony Really Suing Joel Tenenbaum?

Joel Tenenbaum is a student pursuing a PhD. He does what lots of students do, listens to music. Apparently Joel also downloads some of that music off the Internet without paying. Sony (and others) found out and sued him. Joel chose to fight the suit and enlisted the help of law professor Charles Nesson. Apparently that didn't go so well, and a jury returned a verdict against Joel of $675,000 for downloading about 30 songs. Wow.
The trial judge (correctly) decided that was way too much money. The trial judge said the award was so excessive that it was unconstitutional, so the trial judge reduced the amount by a factor of 10 to $67,500. Sony appealed because they wanted the whole excessive amount.
Last week, the appellate court overturned the trial judge's reduction of the award. The appellate court agreed that Joel was liable, and sort of agreed that the award was excessive, they just disagreed with how the trial judge decided to reduce the amount. Basically, the appellate court said the trial judge should have given Sony the choice between a new trial or the lower amount.
Here is a really good article written by a second year law student who has an interesting perspective on the case. What makes it interesting is the author asks the question: Why is Sony pursuing such an excessive damages award when it is costing Sony so much to do so? In other words, what does Sony really have to gain by pushing to re-instate the original $675,000 award? The case just went back to the same trial judge who is likely to come down the same way, only this time he will offer Sony the option of a new trial instead of the lower damages amount. Either way, does Sony really think it will recover $675,000 from a student? Really?
Good business sense should dictate that a company should make good business decisions. Here, Sony and its gang are pushing forward to reinstate a damages award that it could never recover even if it was reinstated, or to get a new trial that won't do anything for Sony either. All they could possibly hope to get is another excessive, noncollectable verdict. Sony is spending a ton of money fighting this case with very little, if any, chance of actually recovering anything.
Here's what's really happening. The economy is still very soft. Law firms are still laying off lawyers and struggling to get work. So here is the story that its law firm sold to Sony (and many other big companies). "You have to push this case to set an example." "If you don't fight hard then others will do the same thing." "It's OK if you lose lots of money on this case because you will make it up later." That is all a crock of poop.
Have all these lawsuits seriously impacted online piracy? No! Students still download just as many songs online as ever. They also buy a lot more songs than ever too. In fact, the only thing that has happened is these lawsuits have spawned an entire cottage industry of online piracy lawsuits. These companies are even suing dead people now. If death isn't a deterrent to online piracy, a lawsuit certainly isn't.
Sony and their ilk are not making money on these cases. The RIAA is not making money on these cases. The only people making money on these cases are the lawyers. As a copyright lawyer myself, I realize the inconsistency with which I make that statement because I am not philosophically opposed to people making money. However, in situations where the only people making money are the lawyers, is that really justice?

Thursday, September 8, 2011

Perfect your Copyright: Register Your Photographs!

I have mentioned before that registering your copyright before infringement occurs gains you some very significant benefits. If you are a photographer in the digital age, that lesson should be especially dear. If you don't want to believe me, then take the advice of Jeremy Nicholl, a British photographer based in Moscow who specializes in capturing images of the former Soviet Union. He tells a very interesting tale about one of his photographs that was misappropriated and used by a U.S. media company. Thankfully, he began registering his images in the U.S. Copyright Office some time ago, even though he is based in Moscow, so he was able to secure a very handsome settlement with the perpetrator in fairly short order.
That article is an interesting read both for his story of enforcing his rights from afar, and for his valuable advice concerning the importance of and ease with which photographers can perfect their copyrights by registering them with the U.S. Copyright Office, regardless of where you live and work. After all, you never know where the copyright infringement will occur. Just ask Jeremy Nicholl.

Tuesday, September 6, 2011

Contingent Fee Copyright Lawyers: In Defense of Alternative Billing

Unlike most lawyers, we take the majority of our cases on a contingent-fee basis. To be fair, we are not alone and lots of lawyers work on contingency, although not that many in intellectual property infringement cases. We are frequently attacked as ambulance chasers and worse. But the reality is that the contingent-fee lawyer is the only lawyer who really has your best interests in mind. Invariably, the arguments against contingent-fee lawyers come from hourly-billing lawyers who are perfectly willing to fight your case to your last dime, regardless of how unlikely you are to win.

I'd like to take this opportunity to debunk several myths about contingent fee copyright lawyers that keep getting persisted.
Myth 1: Contingent Fee Lawyers File Frivolous Lawsuits
Reality: Say an employer came to you and said: I'll give you a job selling my product, and your compensation will be tied to how well my product sells. Would you take that job without even considering how well the product will sell? Or would your desire to take the job turn mostly on whether you think the product will sell? Contingent fee lawyers don't make any money unless they win. It makes no sense for a contingent fee lawyer to take a case that has no merit. Contrast that reality with hourly-based lawyers who get paid regardless of whether their client's case has any merit.
Myth 2: Contingent Fee Lawyers Are All Ambulance Chasers
Reality: Contingent fee lawyers do not need to chase cases. Believe it or not, there are quite a lot of people with legal disputes who want a lawyer who doesn't charge by the hour. You should also not be surprised that most lawyers are unwilling to invest upwards of a million dollars (sometimes even more) of their time with the possibility of never getting paid. It's simple supply and demand. There are way more contingent fee cases than there are lawyers to take them.  So contingent fee lawyers can typically be very selective with the cases they take. Why take a dog case when there are ten more people begging you for "free" legal representation?
Myth 3: You Have To Fight Contingent Fee Lawyers Or They Swarm Like Piranhas
This one is my favorite. This is the one that counsel for big companies like to tell their clients.  If your big company gets sued, your in-house counsel will invariably get an immediate notice from outside counsel offering to take on the case right away.  If the lawyers who brought the suit are contingent fee lawyers, that notice will invariably come with the "you have to fight these trolls" mantra.  Note that I didn't mention any actual substantive analysis in that notice.  There is never any substantive analysis in that first notice.  That's because the big firm has to strike quickly; they must offer to take the case immediately before some other big firm beats them to it.  There's just no time to analyze the actual case, only to attack the plaintiff's lawyers. 

After outside counsel gets assigned, the next battle cry is that if you settle this case, your company will just keep getting sued; you will be better off fighting this case so that these contingent fee lawyers will think twice about suing your company again.  Sounds reasonable on its face.  The problem is go back to Myth No. 1 and Myth No. 2.  Contingent fee lawyers rarely file cases they can't win.  Why would they? Suing your company again has nothing to do with whether your company fights back; it has everything to do with whether your company loses when it does. And I can assure you, companies that fight cases they should settle end up losing way more than they should. Just consider this shoe company that refused to settle an infringement case over 9 pictures of shoes, and ended up with a $1.3 Million judgment against them.

Test this theory.  If you work in a big company, and your company gets sued, and your outside counsel says "we have to fight these darn contingent fee lawyers" do this:  Demand that your own lawyer represent you based on the outcome.  In other words, make your lawyer agree to represent you for free if they don't win the case.  See how quickly they take that deal.

Friday, September 2, 2011

Copyright Is The New Patent: How to Protect Your Software, Again

Back in the day (the early '90s), copyright law was viewed as the best way to protect software from piracy. There was a ton of cases that tried to establish some rules, rooted in copyright law, to protect the “look and feel” of software.* The purpose was to extend copyright protection to more than just someone’s source code and to provide meaningful protection for the labors of software developers.
The big push toward stronger software copyright protection was sidelined around 1995 when patent law gained acceptance as the superior protection mechanism. In re Beauregard is often cited as the case that started it all. Then, for about the next decade, patent law was the software protection king, resulting in countless patent infringement lawsuits.
But today, there seems to be a strong push back towards copyright law. More and more, companies are relying on copyrights instead of patents to protect their software. Recently, Oracle secured a HUGE ($1.3 Billion) verdict against SAP for copyright infringement of their software. Sure, it was just reduced to $272 Million, but still. Some say that's big money. Not surprisingly, Oracle has also begun protecting its APIs using copyright law.
There are, I believe, quite a few compelling reasons for preferring copyright law over patent law for protecting software. Here are just a few of them.
Copyright Protection Is Easier To Get
Unlike patent protection, copyright protection springs naturally from your work without having to do anything else. Whereas a software patent usually costs $20,000 or more to get, if you can even get it, copyright protection is automatic and can cost as little as $60. Plus you can always file your copyright registration, regardless of how long you've been selling your software or how many people you've told about it.
Copyright Protection Is Faster
In a world where last-year's software is old news, the typical three to five year delay to get a patent means that as soon as the software patent issues it has probably already been obsolete for a couple of years. Again, copyright protection exists the moment you write your code. There is nothing else you must do, although it is a very good idea to go ahead and spend that $60 and register your software.
Copyright Infringement Is Easier To Prove
To prove copyright infringement, you basically just put the protected software beside the accused software and take a look. Does the accused software look like a copy? If so, then infringement. That's an oversimplification, but the proof really is almost that simple. Contrast that with patent law, where litigants must often spend millions of dollars on claim charts, claim interpretation, expert reports, and on and on.
There May Be More Money If You Have To Sue
The copyright owner always has the potential of getting the profits of the infringer. Not so with software patents. Also, copyright statutory damages are often significantly higher than any other measure of damages. Patent law has no statutory damages. Throw in the much higher likelihood of also recovering attorneys fees in the copyright case, and the numbers just keep adding up.
Copyright Law Is Still Strong
The copyright laws are still very strong. Copyrights are not routinely stricken down as being "un-copyrightable." Actually, that almost never happens. That's probably because there is just something viscerally wrong about someone else making money by copying your work. Contrast that with patent law, where judicial activism has eroded the strength of patent protection to the point where many question whether patents are even worth what it costs to get them any more. My personal (admittedly unscientific) research suggests that a small company has a better chance of being struck by lightning on the same day it wins the lottery than having a significant damages award upheld against a large company in a patent case.
There are other reasons copyright law is fast becoming the legal theory of choice for protecting software, but these are some good ones. If you are a small software company with a successful product, know that you will have to protect it soon. That, unfortunately, is just the way business is conducted these days. So when that day comes, seriously consider your copyright options.

* If you want to read more about early copyright protection on software, here's a link to an article about many of those "look and feel" cases, including the seminal Lotus v. Borland case that went to the Supreme Court.

Monday, August 29, 2011

Hell's Angels Sues T-Shirt Maker For Copyright Infringement

The term "damages" has new meaning when it's being sought by the Hell's Angels. CBS is reporting that T-Shirt maker Wildfox Couture has been sued for copyright infringement by the Hell's Angels motorcycle club over a t-shirt made by the company that reads: "My Boyfriend s A Hells Angel."
Wildfox T-shirt that is subject of suit by Hells Angels
The club's lawyer says that even the Hell's Angels don't put their name on T-shirts, so certainly no on else can. The club wants all the T-shirts destroyed, which seems a waste. Shouldn't they at least be given to charity or something?
The Hell's Angels are no strangers to the legal system either. Apparently, they are quite litigious when it comes to protecting their intellectual property. They sued Disney for allegedly exploiting the Hell's Angels image in the move "Wild Hogs,' and they sued the Alexander McQueen fashion house for allegedly using the Hell's Angels 'winged skull' logo. Good for them.
The report says copyright infringement when I believe that the real cause of action is actually trademark infringement. If it really is a copyright case and not a trademark case, then I think the Hell's Angels were poorly advised. The maker would have a pretty decent fair use defense, although I don't really see a defense to trademark infringement. No matter, it still makes for an interesting story.

Monday, August 22, 2011

Comcast Says Copyright Infringement: What do I do about this letter?

I've already discussed the letters that many people are getting now. The ones where you are accused of having illegally downloaded a movie because someone says your I.P. address was used to do so. As I said earlier, it means that some rights-holder (like Sony or Universal Studios, for example) has filed suit against your I.P. address claiming copyright infringement. OK, you say, but what do I do? Here is some advice.
Do I fight the subpoena?
Probably not. Most people want to fight the subpoena based on a visceral reaction to the invasion of their privacy. But the legal standard for defeating a subpoena is very high, and it would be expensive to fight it. My guess is it would be more expensive to fight the subpoena than just letting the process play out. Understand that at this stage, the only thing that is happening is your ISP is giving your name to the entity who claims that you infringed. This is not an admission of guilt.
That said, if you really just want to fight the subpoena, and you believe you have good grounds for doing so (e.g., you didn't even have an account with that ISP at the relevant time), then what you need to file is called a "motion to quash" the subpoena. You shouldn't take on this task without at least some advice from an attorney.
Do I mail in the letter they ask for?
Sometimes your ISP will block your service and notify you in the letter that you can respond with your own letter admitting several things in order to have your service re-established. Usually, you are asked to say things like (1) you have deleted the downloaded work from your computer, (2) you didn't know what you did constituted copyright infringement, (3) you promise you won't do it again, and/or (4) you consent to jurisdiction somewhere, like your hometown or where the suit was filed. You have to understand that if you send in this notice, it will do almost nothing for you. I will explain more in another post, but the only entity that benefits from you sending in that letter is your ISP, not you. Unlike above, this notice would be an admission of guilt and would seriously compromise your rights.
Do I fight the suit?
Whether you choose to fight the suit depends on how certain you are that you did not do what you are accused of doing. If you are completely certain you did nothing wrong, then you may want to fight the suit. There are several grounds upon which these suits can be defeated. For example, if you can prove that you were on vacation when the alleged download happened, and there was no one at your house, then you would more probably be able to defeat their case. There are other reasons you could win too, like your ISP was wrong about what I.P. address your house was using at the time. These things change all the time, and maybe they got their records wrong. Or maybe the person who first identified your I.P. address got it wrong. Maybe some numbers got transposed. Maybe your wi-fi network was not secured and someone else was surreptitiously using your Internet service without your knowledge. Who knows? The point is, if you are certain you did not do what you are accused of doing, consider fighting it.
What if I win, so what?
The good news is "what's good for the goose, is good for the gander." If you are at the point where you have been personally accused of infringement, then undoubtedly you were informed that the rights-owner can also seek an award of attorneys fees against you. These can easily be in the low hundreds of thousands of dollars. But they would have to win first. If you win, guess what? Yes, you get that same award of attorneys fees against them for bringing the case. They didn't tell you that, did they?
But again, whether you choose to fight the case should turn on how certain you are that you can prove it wasn't you who downloaded or uploaded the copyrighted work. If you are certain it wasn't you, and you can prove it, then you should consider fighting the case. If you can find a contingent fee lawyer (like us) who will take the case, then you could potentially turn a bad thing into a good thing.

Monday, August 15, 2011

How Much Is My Copyright Case Worth?

I frequently hear this question. Because of the nature of my practice (contingent fee), I am usually just as interested as the copyright owner about the answer. While I can’t tell you exactly what your case is worth unless you tell me about it, here are several of the things I consider.
  • Was the work registered before infringement began? Hopefully, yes. If your work was registered before the infringement commenced, then there are several additional damages options available to you, namely statutory damages and attorneys fees. Statutory damages are like liquidated damages. They are an amount of money that you can be awarded without having to prove anything else. If you work was already registered, you can also get an award of reasonable attorneys fees if you prevail.
  • What would you have charged for the infringing use of your work? You can always get an award of what's called “actual damages” for infringement. In essence, this means the amount of money that you would have charged for the type of conduct that constituted the infringement. Someone sold 500 copies of your book without your permission? What would you have charged for those 500 copies of the book? That’s your actual damages.
  • How much money did the infringer make distributing your work? You can also get an award of the infringer’s profits resulting from the infringement. This means regardless of what you yourself would have made on the sale of your work, if the infringer made money, you can get it. Someone sold 500 copies of your book without your permission and made $500,000? You could be entitled to an award of that $500,000 even if you yourself would have only charged $500.
  • How much money did the infringer make selling its own products in connection with your work? Sometimes you can even get an infringer’s profits from the sales of its own product if those sales can be tied to your infringement. "Big Company" gave away 500 copies of your book without your permission, and those giveaways resulted in $5 million in sales of Big Company's own product? You could be entitled to an award of that whole $5 million. This would be the extreme case, but it is not unheard of.

What Does This Letter I Got From Comcast Mean?

Right now, a lot of people are getting letters from their Internet Service Providers, like Comcast, informing them of something like this:
You have been identified via your assigned Internet Protocol address in <some lawsuit> for allegedly infringing <someone else’s> copyrights on the Internet by uploading and/or downloading a movie using a computer assigned the Internet Protocol address X.X.X.X on <some date>.
Sometimes people get this letter at the same time their Internet service is suspended. I frequently get people asking: “what does this mean?” Basically, it means this. You have been sued. More specifically, a lawsuit, like this one, was filed against your I.P. address. The letter you got from your ISP is letting you know that the entity that sued your I.P. address wants your name, and your ISP is planning to give it to them unless you stop it.
Does this mean you are going to lose your house? No. Although it is true that sometimes these lawsuits are legitimate, sometimes they are not. Some of these are just shakedown cases where a company buys the enforcement rights of unknown movies, frequently porn, and files suit against a thousand or more I.P. addresses expecting a quick and easy settlement. A lawyer named John Steele is notorious for exactly these types of suits.
So if you get a letter from your ISP like the one mentioned above, and you know you did not do what you are being accused of, consider contacting an attorney before responding to the letter in any way. I will cover what else you should do, and maybe should not do, in another post.

Tuesday, August 2, 2011

Taea Thale sues Apple for Copyright Infringement

Professional photographer Taea Thale has sued Apple, Inc. for copyright infringement. Taea took several photographs of the popular indie band SHE AND HIM. Ms. Thale authorized limited use of the photographs to promote the band. There were several provisions attached to the use of Taea's photographs, including that they would only be used in print, would not be used in conjunction with an album release, and Taea would receive attribution for her work.
Lo and behold, one of those photographs made its way into an Apple advertisement to promote the iPhone, not the band, and in conjunction with SHE AND HIM's second album release. Taea never received any attribution for her work, nor did she ever provide anyone with the authority to use her work this way.
Recently, Taea filed a lawsuit against Apple for copyright infringement over Apple's unauthorized use of her photograph. The Whitaker Law Group, the Mann Law Group, and Katharine Livingston represent Taea Thale.

Wednesday, June 1, 2011

Sound Recordist Sues iBird For Copyright Infringement

Martyn Stewart is a nature recordist who has spent the last 30 years amassing one of the most impressive collections of nature sounds in existence. He routinely licenses his sounds for various purposes, such as movies, documentaries, commercials, websites, and occasionally software applications. Stewart was approached by a company, Mitch Waite Group, about using his bird sounds in an application that Mitch Waite Group was developing for handheld devices.
The parties discussed licensing terms, but never consummated an agreement. However, Mitch Waite Group released the iBird application for the iPhone platform and it was vastly more successful than the Mitch Waite Group had anticipated. With its success proven, Mitch Waite Group attempted to negotiate a substantially lower royalty rate than Mr. Stewart originally requested and to which Mitch Waite Group had already agreed.
The disagreement stalled the license negotiations, but sales of the iBird continued to soar. The iBird was so popular, that Apple even took notice and used the iBird in Apple's iPhone commercial. Twice. Both times featuring Mr. Stewart's bird sounds.
Having never been paid for any of the uses of his bird sounds, Mr. Stewart was forced to file a copyright infringement action against Mitch Waite Group and Apple for the use of his sounds. After successfully deflecting several attacks by Apple and Mitch Waite Group against the merits of Mr. Stewart's case, the parties resolved the matter.
Whitaker Law Group and the Mann Law Group represented Mr. Stewart in the matter.