Update on the Thomas/RIAA Case

RIAA Fails to Settle Thomas File-Sharing Case; Retrial Date Set | Digital Media Wire

"What they wanted to do, my client did not want to do," Toder told Wired; Thomas has previously stated she would not settle the case.

Thomas was initially found guilty of copyright infringement and ordered to pay a $220,000 fine for sharing 24 songs on Kazaa.

However, U.S. District Judge Michael Davis declared a mistrial after concluding that he erred when instructing the jury that Thomas should be found guilty if she merely made songs available for sharing, without proof that they had been downloaded by a third party.

The retrial is scheduled to begin on June 15.

For my earlier report on this case, go here

Patents, Trademarks and Hamburgers: Steak n Shake Settles With Burger King

Steak n Shake, Burger King settle lawsuit:

"Steak n Shake Co. has changing the name of its miniature Steakburgers to settle a trademark-infringement lawsuit brought by Miami-based Burger King Corp.

The Indianapolis-based chain was slapped with a lawsuit last month after it unveiled slider-style hamburgers called Steakburger Shots, a moniker Burger King said was 'confusingly similar' to its trademarked BK Burger Shots, BK Breakfast Shots and BK Chicken Shots.

The mini-burgers at Steak n Shake now are known as Shooters.

Steak n Shake CEO Sardar Biglari said at the chain's annual meeting Friday that he simply called Burger King CEO John Chidsey and worked out the dispute over the phone.

In the lawsuit, Burger King had said it registered the names with the U.S. Patent and Trademark Office and began promoting them in February 2008, well before its competitor unveiled 'identical' products."

Hollywood and the Problems of Intellectual Property

What applies to Hollywood applies to Indiana businesses. From Good Morning Silicon Valley comes Hollywood trying desperately to keep a lid on the box:

"Of course, media-center computer owners can still watch Hulu’s shows on the big screen — they just have to do it through a conventional Web browser instead of Boxee’s cleaner interface, and that leaves Techdirt’s Mike Masnick, among others, confounded: “It’s difficult to see how there’s even a claim by the content providers at all. They put the content on Hulu so that anyone watching the content via the Internet on a computer within the geographic restrictions should be fine. Boxee is just an application on a computer. It’s functionally identical to watching the content on your computer screen. The only real difference is that the ’screen’ is a television instead of a monitor. But the mechanism is identical. It’s difficult to see how the content providers can claim any right whatsoever to say that you can watch the content that they purposely put online only on a specific type of screen.”"

Remember, if you want more information about retaining me for a case, please give me a call at 765-641-7906.

YouTube Changing Copyright?

Eventually, YouTube might affect cxopyright law. I think everyone agrees the Internet has put incredible strain on copyright law. The ABA Journal - Law News Now published Copyright in the Age of YouTube which examines the issue at soem length:

"The ruling is part of a lar­g­er legal struggle over who should bear the burdens of stopping online copyright infringement. Movie companies, record companies and many other copyright owners fear that—because committing copyright infringement online is so fast and easy, and because the huge number of online infringements is skyrocketing—it is impracticable for copyright owners to stop online infringements by suing all the individual wrongdoers.

So content owners are seeking alternatives. They are trying to automate the process of removing allegedly infringing material. They are asking the courts to impose liability on YouTube and other online companies if these companies fail to vigorously police the material posted by their users. And the content owners are lobbying Congress for tougher laws against infringement."

Update on Bratz case

An update on a case I wrote about here. From Corporate Counsel Center - News:

"RIVERSIDE, Calif. (AP) - The judge who barred MGA Entertainment Inc. from selling or making its popular Bratz dolls agreed Tuesday to extend a deadline he set for the company to take the products off store shelves.

MGA, which was initially told to stop selling Bratz by Feb. 11, had argued in court that retailers would not order the toys unless the court could guarantee they would remain in stores through most of 2009. U.S. District Judge Stephen Larson obliged, and allowed MGA to file a motion for a later deadline by next week.

'Given the clear importance of the Bratz line to MGA's financial health, it's not a big leap to see that (the February deadline) would have significant economic impact on the viability of MGA,' Larson said."

Decision on Ringtones and Copyrights

U.S. Copyright Office -115 Review

The Register of Copyrights has issued her decision identifying and correcting erroneous resolutions on material questions of substantive law under title 17 that underlie or are contained in the Copyright Royalty Judges' final determination regarding adjustment of reasonable rates and terms of royalty payments for the making and distribution of phonorecords of musical works, Docket No. 2006‑3 CRB DPRA, Version PDF

• Review of Copyright Royalty Judges Determination: Notice; correction
  
  __ FR _______ January 26, 2009 Version: PDF
  
  • 
    Register’s Request for participants' views regarding possible legal
    errors contained in the Copyright Royalty Judge's final determination
    (January 8, 2009), Version: PDF
    
    • Views of Participants: Copyright Owners; RIAA; DiMA
    
    
  
  

Trademarks: Barbie Beats Bratz

I do like a good trademark fight. The London Times Online reports Barbie triumphs over Bratz in court battle:

"An uneasy peace returned to the dolls' house this week after a prim and proper Barbie finally repelled a four-year siege by an unruly gang of gatecrashers called Yasmine, Chloe, Sasha and Jade.

In what could be the decisive blow in a multi-billion dollar legal battle, a California judge ordered MGA Entertainment to halt production of its Bratz dolls after a jury decided that they infringed copyrights owned by Mattel, owner of arch-rival Barbie."

***

“Mattel has established its exclusive rights to the Bratz drawings and the court has found that hundreds of the MGA products — including all the currently available core female fashion dolls Mattel was able to locate in the marketplace — infringe those rights,” Judge Larson said in the ruling.

He also ordered MGA to recall all Bratz dolls from toyshops and distributors but gave the manufacturer a seven-week grace period, allowing them to stay on the shelves over the crucial Christmas period.

The judge also ruled out the possibility of an arrangement whereby MGA might continue to produce Bratz dolls but pay a royalty to Mattel for using its copyright, a common solution in similar US intellectual property disputes.

***

In August, a court ruled that Carter Bryant, the creator of Bratz, came up with the concept while working for Mattel, where he was a Barbie designer.

A jury subsequently ruled that Mr Bryant had secretly sold the Bratz concept to MGA and the court awarded the majority of the rights to Mattel, with £100 million in damages.

What you done to protect your intellectual property? Think about the losses to MGA and ask if your company could survive this kind of loss. If not, get yourself to a lawyer ASAP.

Hitting Back at The Record Companies

I admit the music downloading cases are not part of my practice but they are so interesting that I cannot ignore them either. (See my earlier posts here and here and here for examples.) lexisONE(R) supplied

Law Professor Fires Back At Song-Swapping Lawsuits:

A Harvard Law School professor has launched a constitutional assault against a federal copyright law at the heart of the industry's aggressive strategy, which has wrung payments from thousands of song-swappers since 2003.

The professor, Charles Nesson, has come to the defense of a Boston University graduate student targeted in one of the music industry's lawsuits. By taking on the case, Nesson hopes to challenge the basis for the suit, and all others like it.

Nesson argues that the Digital Theft Deterrence and Copyright Damages Improvement Act of 1999 is unconstitutional because it effectively lets a private group the Recording Industry Association of America, or RIAA carry out civil enforcement of a criminal law. He also says the music industry group abused the legal process by brandishing the prospects of lengthy and costly lawsuits in an effort to intimidate people into settling cases out of court.

***

Entertainment attorney Jay Cooper, who specializes in music and
copyright issues at Los Angeles-based Greenberg Traurig, is convinced that Nesson will not persuade the federal court to strike down the copyright law. He said the statutory damages it awards enable recording companies to get compensation in cases where it is difficult to prove actual damages.

The record companies have echoed that line of defense. In court
filings in Tenenbaum's case, they contend that the damages allowed by the law are "intended not only to compensate the copyright owner, but also to punish the infringer (and) deter other potential infringers."

But are these lawsuits the only way the record industry could
deter piracy? Nesson believes the industry could develop new ways to prevent copyright material from being shared illegally. One idea would be to bundle music with ads and post it for free online, he says.

"There are alternative ways," he said, "of packaging entertainment to return revenue to artists.

Do I think it will be successful? No. But we can be thankful for law school professors who do not need to worry about the costs of litigation for bringing these kind of cases.

Personally, the music industry bewilders me with these kind of law suits. They are in the right on the technicalities of the law but I feel that they may be winning battles while losing the war. Customers will get turned off by the big companies and the companies will lose money. The performers and their customers will find another means of getting what they want which will cut out the companies. There also exists the chance that enough customers will get annoyed enough that Congress will change the copyright law.

Now the RIAA Goes After a. Lawyer

From The ABA Journal - Law News Now comes RIAA Seeks Sanctions for N.Y. Lawyer’s ‘Vexatious’ Blog Posts of Case Filings:

"A lawyer who is known for defending individuals accused of peer-to-peer sharing of copyrighted works over the Internet is now on the hot seat himself.

The Recording Industry Association of America is seeking sanctions against attorney Ray Beckerman in a federal court case in New York, claiming that he has engaged in "obstructionist tactics" and provided "misinformation." Its filing is based in part on Beckerman's postings on his blog, Recording Industry vs The People, explains Legal Blog Watch.

***

The Legal Blog Watch post is based an earlier post on Wired magazine's Threat Level blog about RIAA's claims that Beckerman engaged in "vexatious" litigation tactics.

Wired provides a copy of the 31-page motion motion (PDF), which was filed for RIAA by attorneys Victor Kao of Robinson & Cole, in New York, and Eve Burton of Holme Roberts & Owen, in Denver.

Slashdot Discusses Trade Secrets Superseding Patent Law

Those who know Slashdot probably do not need forewarning that the discussions there are voluminous and can run the gamut from silly to important. Being now forewarned, you might not want to take a look at The Death of Nearly All Software Patents?.

Along similar lines is my post, Biotech Moving from Patents to Trade Secrets.

Trade Secrets and International Law

Not a subject that comes through my office (but one can still hope), but one that is possible and becomes more possible with every new business arriving on the Internet. Nor do I usually suggest reading a long, scholarly blog post, but TRADE SECRETS AND THE ROME II REGULATION ON THE LAW APPLICABLE TO NON-CONTRACTUAL OBLIGATIONS from The Trade Secrets Blog is both long and scholarly:

Not the least important consequence of whether trade secrets are governed by Arts 4, 6 or 8 of the Rome II Regulation concerns whether the parties are free to make their own choice of applicable law pursuant to Art.14. If such an agreement is possible at all it may always be made ex post facto, and in the case of parties "pursuing a commercial activity" (as will almost invariably be the case in trade secret cases between competitors) it may be made in advance of the harmful event, provided the agreement was freely negotiated.

It even has footnotes! I read it as closely as I do anything I want to know but is not essential to current work. No, it will not appeal to non-lawyers but I suggest anyone contemplating international work get this post in front of their lawyers.

Oh, for those Hoosiers thinking that international trade is not likely for us, please remember that Canada is only three hours away.

Trade Secrets: Viacom and Google

A late post, sorry, but it seems some people just are not getting this (okay, high gas prices and an economy heading for the cellar and a presidential election might seem a bit more important) story about Court Rules Viacom Not Entitled To Google Trade Secrets:

"A federal judge ruled Wednesday that Google need not reveal details of its search algorithm or ad platform to Viacom, which had requested the information as part of its $1 billion copyright infringement lawsuit.

In a 25-page order, U.S. District Judge Louis Stanton in New York ruled that Viacom had not presented a good reason to force Google to reveal trade secrets like its search formula. 'The search code is the product of over a thousand person-years of work,' Stanton wrote. 'There is no dispute that its secrecy is of enormous commercial value. Someone with access to it could readily perceive its basic design principles, and cause catastrophic competitive harm to Google.'

Stanton also ruled that Viacom was not entitled to learn the details of Google's ad platform.

But the ruling did not go completely in Google's favor. Stanton ordered Google to provide Viacom with information about all videos that have been removed from the site--a figure that Google pegs in the millions."

Viacom seeking Google's trade secrets seems like overreaching by a company who trying to protect its copyrights. We may be seeing the change in copyrights (and patents, possibly) that has been sensed by many - that Viacom stands on one side of a debate over intellectual property while users stand on another. I know that sounds all abstract and vague, but consider this: Viacom and Sony Records and writers and all the others whose livelihoods depend on intellectual property find those livelihoods threatened unless a new business model is found.

Biotech Moving from Patents to Trade Secrets

TMCNet's U.S. Patent Reforms Might Force Firms to Rely on Trade Secrets has several interesting points. First, it serves as a reminder of the interplay between patents and trade secrets. Secondly, it notes (what should be a familiar refrain if you have been reading my other articles on trade secrets) that effective trade secrets require planning and enforcement by the business.

The flight away from patents can be seen in filing statistics. The number of chem/bio patents filed at the USPTO rose from 30,000 per year in the mid-1990s to 45,000 in 2001. By 2006, the level of filing had fallen back to where it stood 10 years earlier. Similarly, at the European Patent Office, there was a 13 percent year-on-year increase between 1995 and 2000, followed by a 6 percent year-on-year fall from 2000 to 2003.

But, Gollin said, 'biotech is still innovative, so where is innovation going if not into patents?'

The answer seems to be that the scales are tipping back in favor of keeping trade secrets, posing the question of whether biotechs prefer the patent or trade secret approach when it comes to protecting their intellectual property."

***

The increased reliance on trade secrets and know-how to protect IP raises cultural and management issues, given that the easiest route for those types of information to be disclosed is through current and former employees.

That is a particular problem in biotech said Kerry Flynn, vice president of intellectual property and licensing at Shire Human Genetic Therapies Inc. "It is an incestuous community; employees leaving to join a competitor down the street makes keeping trade secrets a bit of a challenge."

***

As a result, the company has set up a formal process to protect trade secrets. In addition to signing nondisclosure agreements on joining Shire, new employees are briefed by a lawyer on the company's policy. They are reminded also of their duty of confidentiality to previous employers, in a bid to ensure that Shire cannot be accused of stealing trade secrets from other companies.

Copyfight

An interesting blog that goes a bit beyond the usual copyright blog, Copyfight :

Here we'll explore the nexus of legal rulings, Capitol Hill policy-making, technical standards development, and technological innovation that creates -- and will recreate -- the networked world as we know it. Among the topics we'll touch on: intellectual property conflicts, technical architecture and innovation, the evolution of copyright, private vs. public interests in Net policy-making, lobbying and the law, and more.

I call this cutting edge stuff, so take a look now.

Who Owns Intellectual Property?

Who Owns Intellectual Property? from HBS Working Knowledge has some things to say both to lawyers and businesspeople.

"Turning to the Internet itself, and particularly to content-sharing sites, the matter of ownership is challenged in a different way. Content produced by news media as well as individuals acting as professionals or amateurs is being copied, spliced, and represented essentially as something so new and unique that it is often downloaded by hundreds of thousands of viewers who might not have watched the original material. Who owns the result? Does anyone owe others for the use of the content? If so, how much and for what share? Or has the culture of 'free' become so deeply imbedded in the minds of a new generation of users that content developers can only hope for partial, occasional, or eventual financial rewards for their efforts?"

The Internet has brought into question current laws on copyright and patent. Patent law underlies our computer age - Microsoft has patents on Windows and Intel has patents on the computer chip. On the other end of the spectrum is Linus and open-source software.

Let me be explicit about why this is so important: money, lots and lots of money are at stake here. Record and movie companies find themselves warring against the online-free ethos. (For an example of this see my post here.) I think they are losing but that is besides the point this morning.

Until this article, I thought trademarks would probably remain out of the copyright/patent/Internet fight. The following makes me wonder about that or if we will see a morphing of trademarks:

Wolff Olins' homepage presents a provocative redefinition of brands as practical platforms that enable people to do things. In its words, "As brands become less the property of an organisation and more the banner of a movement, ownership will become even looser. Logos will be things other organisations, and individuals, can borrow and adapt." That belief, they maintain, will require that some companies, in their own best interests, relinquish control over brands and "be more generous" with consumers. In other words, they take the risk of transferring ownership and quality control of what used to be called their brand to others. In this case, who owns the intellectual property?

Read the full article and the comments for a fuller explanation of what is going on.

Trade Secrets: Today's Roundup of Litigation

No claims made that these stories represent all of the new trade secrets litigation but these are the ones caught by Google Alerts.

IOSTAR entangled on earth:

IOSTAR and its founder and CEO have filed suit against the three former associates, alleging theft of corporate secrets in order to develop competing satellites. In a counterclaim, the three allege that the CEO has misappropriated millions of dollars and violated tax and securities law.

****
In its lawsuit, IOSTAR charges that Stuart, French and Busch "have systemically misappropriated IOSTAR's trade secrets."
They did so, the suit alleges, in order to develop a space tug that would compete with one being fashioned by a company called SWANsat, in a project in which IOSTAR is participating.
"We think the claims against Mr. French are groundless," said Sam Straight, French's Salt Lake City attorney.
Stuart and Busch declined comment about their dealings with D'Ausilio, but in their answers to the lawsuit they deny appropriating any trade secrets from their involvement with IOSTAR.

The articles goes on at greater length about the start up problems and possible chicanery. That makes it worth reading for more than the trade secrets.

Former Lubrizol Employee Charged:

A former research and development employee at specialty chemicals company Lubrizol Corp. is accused of selling trade secrets to a competitor in South Korea, federal officials said.

Kyung Kim, 62, of Broadview Heights, was charged Wednesday in U.S. District Court with theft of trade secrets and conspiracy, said assistant U.S. Attorney Justin Roberts. No court date has been set.

For something quite a bit different and foreign: GM brinjal battle goes to HC.

NEW DELHI: It's a classic case of commercial interest vs public interest which could set an important precedent. Genetically modified brinjal — expected to be the country's first edible GM crop — could find its way to your plate soon.

But first, Delhi high court will have to decide whether the company conducting its field trials can keep data on health and environment safety tests out of the public domain on the grounds that the information is a "trade secret".

The data in question comprises toxicity and allergenicity studies and was submitted by Maharashtra Hybrid Seeds Co Ltd (Mahyco), a subsidiary of multinational Monsanto, to the department of biotechnology for regulatory clearances.

Another article having more than interest than only trade secrets. I suspect that in the United States we would see patent issues as well as trade secrets.

Tire maker wins trade secret case:

"Sam Vance, Alpha's sales and marketing manager at the time, was found guilty by 12th Judicial Circuit Court Judge Robert W. McDonald Jr. of giving a pair of overseas competitors everything they needed to steal business away from the Sarasota company."

***

Jennifer Compton, an attorney with the Sarasota law firm Abel Band who worked on behalf of Alpha, said the win in the trade secret case was huge for her client.

"This is one of the larger ones in Sarasota County history," Compton said. "This is a very big deal for them. They were almost out of business."

Whether Vance has the wherewithal to pay the $19.7 million remains to be seen.

Ah, the age old question: can the judgment be collected?

Music Downloads - The View from Scotland

I have written a few posts on music downloading (such as here) just because I find them to be an interesting confluence of law and business - especially our modern, Internet business. I like using the music business' problem with downloads for explaining that businesses with intellectual property do not sell CD's, or books, or movies. They sell their copyright or patent. Even those selling things like soft drinks or hamburgers have businesses turning on another intellectual property - trademarks.

Which brings me back to Scotland's Sunday Herald and NO BUSINESS IN SHOWBUSINESS?. The articles has lots of interesting bits but here is the conclusion:

If the television and film industry is coping better it is perhaps because unlike with music, they're still dealing in the same discrete bits of entertainment rather than having to deal with the decline of the album and the rise of the individual track.

Forde predicts that there is consolidation on the horizon, as music companies diversify their business models. "Some of the majors stopped calling themselves record companies a while back, and started saying that they were entertainment corporations, which is, I think, a sign of things to come.

"They haven't moved quickly enough for the times, but they're exploring what's out there. They've finally realised that putting out albums is not the be all and end all," he says.

Music Download News - New Tactic from Recording Industry

Since I have written before (here and here and here) about the lawsuits against music downloading, the Washington Post article, Download Uproar: Record Industry Goes After Personal Use, caught my eye.

"Now, in an unusual case in which an Arizona recipient of an RIAA letter has fought back in court rather than write a check to avoid hefty legal fees, the industry is taking its argument against music sharing one step further: In legal documents in its federal case against Jeffrey Howell, a Scottsdale, Ariz., man who kept a collection of about 2,000 music recordings on his personal computer, the industry maintains that it is illegal for someone who has legally purchased a CD to transfer that music into his computer."

I read about the RIAA's theory elsewhere. Distilled to a bare minimum, I do not own my music CD but only use it under a license from the record company.

The industry's lawyer in the case, Ira Schwartz, argues in a brief filed earlier this month that the MP3 files Howell made on his computer from legally bought CDs are "unauthorized copies" of copyrighted recordings.

"I couldn't believe it when I read that," says Ray Beckerman, a New York lawyer who represents six clients who have been sued by the RIAA. "The basic principle in the law is that you have to distribute actual physical copies to be guilty of violating copyright. But recently, the industry has been going around saying that even a personal copy on your computer is a violation."

Yeah, a lot of people can believe this argument - lawyers and laypersons alike.

I cannot but heartily agree with this:

The RIAA's legal crusade against its customers is a classic example of an old media company clinging to a business model that has collapsed. Four years of a failed strategy has only "created a whole market of people who specifically look to buy independent goods so as not to deal with the big record companies," Beckerman says. "Every problem they're trying to solve is worse now than when they started."

I suppose working at the rarefied levels of my profession as the RIAA's attorneys do, they give no thought to the ultimate wisdom of their legal theories. I have a duty to act in my client's best interests and so do these guys. Yet, this litigation does nothing to advance anything for their clients - other than the RIAA as a bunch of greedy thugs.

Trademarks and trade secrets - Important for your Business?

From the San Jose Mercury News Dynamic nature of patent law actually has more to do with all kinds of intellectual property for business.

"Paul Goldstein, a Stanford law professor, has written a new book on the subject. Despite its title, 'Intellectual Property' (Portfolio, Penguin Group) is an easy read and a good guide for anyone starting or operating a company involved with patent, trademark and copyright issues. And is there any other kind?"

The article goes onto a Q & A with the author:

Q Your book, "Intellectual Property" is subtitled "The Tough New Realities That Could Make or Break Your Business." What are they?

A The realities center around the volatility of intellectual property law - not just patents, but copyrights, trademarks and trade secrets. An abrupt change in any of these areas of law can make or break your business.

Q By "abrupt change," you mean. . . ?

A An example: In the early 1970s, Kodak looked at the instant photography business that Polaroid monopolized, thanks to its patents. Kodak had expert counsel, relying on existing patent law which imposed a high standard, telling it that these patents were invalid, under existing standards.

So Kodak invested $600 million, relying on these expert opinions. Well, by the time the product came out, the Court of Appeals for the Federal Circuit had lowered the patent standard, and suddenly patents that looked invalid when Kodak made its investment were now valid. Once you count the damages levied against Kodak, their loss was over a billion dollars, just because the legal standard changed.

Q Can a company protect itself against something like that?

A There are cycles of high and low protection for each form of intellectual property. In the book, I identify the dynamics that indicate where on these cycles we are today with each area of law and what companies can expect to happen.

For example, patents were on a huge upswing starting in 1980s through the end of the century. Now the pendulum is swinging in the opposite direction.

Q Where else are we in this cycle?

A Trademark is in a long-term upswing. It has, over a 100-year period, expanded from a narrow remedy aimed at protecting consumers from confusion to a robust property right. Look at the polo player on the Ralph Lauren shirt, or the name Calvin Klein - these names and brands have taken on a value of their own, almost like a product or a song.

That's been a huge expansion of trademark, and there's no sign it's going to slow down.

Copyright, on the other hand, is in a more modest way encountering the same cutbacks as patents, most notably in the courts.

One thesis of the book is that these changes occur because of public sentiment. In 1998 Congress extended the term of copyright by 20 years. It was a move of no great prospective economic consequence. But it served as a lightning rod in this country for people who said this was a greedy move to monopolize the public domain. As a result, you'll find courts today carving out exceptions to copyright to a degree that we've never seen before.

The Washington Post on Companies Protecting Their Domain Names

Two types need to read Firms Fight Back in Site Name Game, those starting businesses and those businesses who have taken no steps to protect their online image.

"Shielding a company's brand from early or negative exposure has become a business unto itself. On the advice of digital brand-management services and lawyers, many companies register thousands of names to protect themselves. Every time they launch products or services, executives have to worry about shielding their moves online from competitors and protecting themselves from users who might sully their brand."

Domain names are a bit more and a bit less than trademarks. You also need to think about cyber-squatting.