Copyright

Cowan, DeBaets, Abrahams & Sheppard LLP (CDAS) Partner Eleanor M. Lackman Named a “2019 Trailblazer” by the New York Law Journal

Eleanor M. Lackman, an equity partner of Cowan, DeBaets, Abrahams & Sheppard LLP (CDAS LLP) has been named a “2019 Trailblazer” by the New York Law Journal. Eleanor is one of only 51 attorneys selected for the prestigious recognition.

To review Eleanor’s profile and the full NYLJ “2019 Trailblazers” list, click here.

Fourth Circuit Rules in Favor of Stock Photographer, Overturning Widely Discussed Fair Use Decision

The rights of a stock photographer were recently vindicated when the U.S. Court of Appeals for the Fourth Circuit overturned a controversial Virginia district court decision, which had held that a production company’s use of a stock photo on a website promoting a film festival was fair use.  In the decision, Brammer v. Violent Hues Productions LLC, No. 18-1763, published on April 26, 2019, the Fourth Circuit determined that Violent Hues Productions, LLC’s online use of a cropped version of Russell Brammer’s photo of the Adams Morgan neighborhood in a list of D.C. tourist attractions promoting the Northern Virginia International Film and Music Festival failed all four factors of the fair use analysis.

The case arises from the unauthorized use of a photograph titled “Adams Morgan at Night” (seen in the decision in Appendix A), which Brammer shot from the rooftop of a building in the Washington D.C. neighborhood in 2011.  Experimenting with various shutter speeds and aperture combinations, Brammer photographed a busy street full of passing cars that appear as trails of red and white lights.  He published a digital copy of the photo on his website and on Flickr with a “© All rights reserved” notice, and later licensed the photo for online use.

Years later, in 2016, Violent Hues downloaded the photo—presumably from Flickr, while overlooking the rights notice—and proceeded to crop out the negative space before posting it on http://novafilmfest.com.  Brammer discovered the use and sued Violent Hues.  After the district court absolved Violent Hues of liability under the fair use doctrine, Brammer appealed the decision, asking the Fourth Circuit to set the record straight.

The Fourth Circuit did just that when it engaged in a thoughtful analysis of the fair use factors.  Its decision is instructive as it adds to the wealth of case law on how to interpret the complex and nuanced doctrine of fair use in a case that many thought would have an obvious outcome.

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The 150-Year Itch: California Legislature Amends Civil Code Section 1542 but Creates More Questions in the Process

California Civil Code Section 1542 (“Section 1542”) is ubiquitous in documents relating to California deals, parties, or litigations.  For instance, nearly every severance or settlement agreement entered into in California and/or involving a California person, company, or claim, will include a Section 1542 waiver provision. The main purpose of the Section 1542 statute is to prevent the inadvertent waiver of unknown claims by signing a general release (and at least in the context of settlement and release agreements, Section 1542 often appears in the context of a waiver of the rights granted by the statute).  After nearly 150 years on the books, Section 1542 has just been revised, likely piquing the interest of any lawyer whose practice touches the State of California.

The original language of Section 1542 read:

A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her, must have materially affected his or her settlement with the debtor.

In other words, a general release under California law, no matter how broad, does not extend to claims that were unknown at the time of executing the release. Absent an express waiver of Section 1542, broad release language will not prevent these claims from being brought.

Some of the language, however, has led to debate over interpretation throughout the years.  When the statute was codified in 1872, it referred solely to monetary claims in the context of creditors and debtors. Modern case law, however, has interpreted Section 1542 to not only include monetary claims in the limited debtor/creditor context, but also in many other types of claims and scenarios, for instance, in workers compensation proceedings, personal injury cases, and employment cases. 

In an effort to clarify Section 1542, the statute was amended effective January 1, 2019 to now read:

A general release does not extend to claims which that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release, which  and that if known by him or her, must would have materially affected his or her settlement with the debtor or released party.

As stated in Section 3 of California Senate Bill No. 1431, these additions of “or releasing party” and “or released party” were meant to reflect the interpretations of the terms in Section 1542 as interpreted in existing case law. The revisions are intended to ameliorate confusion as to which types of cases are covered by Section 1542 and are meant to provide greater clarity to a releasing party choosing to waive their Section 1542 rights on the scope and ramifications of that waiver. The newly amended statute now gives notice to releasing parties that Section 1542 definitively encompasses more than just monetary claims, and that if they waive their Section 1542 rights, they are waiving their ability to bring a broader swath of claims.

While the additions of “or releasing party” and “or released party” serves to indicate the full scope of Section 1542’s application, whether the changes from “which” to “that” and “must have materially affected” to “would have materially affected” make a difference to the statute’s application remains uncertain. Similarly, it is unclear whether courts will find a Section 1542 waiver using the old language but executed after January 1,2019 valid.  Due to this particular uncertainty, the amended version of Section 1542 should be used moving forward to avoid potential invalidation of a Section 1542 waiver, including in settlement agreements, contracts and amendments, and other transactional documents. A failure to do so may result in potentially costly litigation over statutory interpretation that could have been easily avoided.  Further, the continued use of the old language, even if found to be enforceable, could potentially lead to the same type of confusion regarding scope that the Section 1542 amendment was meant to fix. The potential costs in time and resources can be easily prevented by updating the provision to its amended language.

The amendment of Section 1542 appears to mark an effort by the California legislature to adapt to the litigious environment in the Golden State. Parties entering into an agreement that includes a Section 1542 waiver should ensure they know what they are agreeing to and should consult counsel for the avoidance of any doubt in light of the recent statutory amendments. Due to the uncertainties raised by the amendment, it may have the unintended (and ironic) side-effect of causing further litigation over statutory interpretation. This section may ultimately require further clarifications and the amendment may have paved the way for even more legislation to streamline Section 1542’s application.

Supreme Court Hands Down Critical Decisions in Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC and Rimini Street, Inc. v. Oracle USA, Inc.,Resolving Circuit Splits Over Interpretation of Copyright Act Provisions

It was an eventful day for copyright law on Monday, March 4, as the Supreme Court of the United States issued two unanimous opinions, both involving provisions of the Copyright Act.  The decisions were fittingly both issued on the 110th anniversary of the 1909 Copyright Act.

In the first case, Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC,No. 17–571, the Court, in an opinion authored by Justice Ginsburg, resolved a long-standing circuit split over whether a copyright owner can sue in federal court with only a copyright application in hand, or whether a completed registration is necessaryThe Court held that “registration . . . has been made” under Section 411(a) of the Copyright Act—and thus an infringement suit may be instituted—when the Copyright Office grants or denies registration after evaluating the copyright application (coined the “registration approach”) rather than when a copyright owner merely submits the application, materials, and fee required for the registration to begin processing (the “application approach”). 

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Law 360: Supreme Court Will Hear ‘Scandalous’ Trademark Case

Law 360 reports that “less than two years after ruling that a federal ban on racist trademark registrations violated the First Amendment, the U.S. Supreme Court agreed Friday to hear a case that will decide whether a similar rule banning “scandalous” material is also unconstitutional.”

Catch up on this issue with our coverage of the 2017 “Slants” decision here: Band Not Banned: High Court Finds Unconstitutional Trademark Office’s Basis for Refusal to Register THE SLANTS Trademark

Dance Dance Litigation: Actor Alfonso Ribeiro Moves to Take The Game Out of “The Carlton”

Earlier this week, actor Alfonso Ribeiro filed a claim for copyright infringement, violation of the right of publicity, and unfair competition against Epic Games, Inc. over its use of the dance move commonly known as “The Carlton” (the “Dance Move”) in the popular video game Fortnite: Battle Royale (“Fortnite”).  Ribeiro also filed a similar claim against Take-Two Interactive Software Inc. and certain of its subsidiaries over the use of the Dance Move in the NBA 2K video game series (“NBA 2K”). 

To date, both Fortnite and NBA 2K have generated millions of dollars in revenue via in-game purchases, including character avatar dance moves known as “emotes”.  These emotes have also taken on their own significance in current pop culture, with millions of teens all over the world posting videos of themselves copying the dance moves of their video game avatars on YouTube and other social media sites, often under hashtags referencing the video games (e.g., #fortnitedance or #fortnitevideos), rather than the dance move creators.  The Dance Move, which was first popularized by Ribeiro in an early 90s episode of the TV sitcom “The Fresh Prince of Bel-Air,” was included in Fortnite and NBA 2K as purchasable in-game emotes named the “Fresh” and “So Fresh”, respectively.  The Dance Move was also featured in promotional materials for the games.  None of these uses of the Dance Move gave attribution to Ribeiro or had Ribeiro’s prior permission, which Ribeiro argues was necessary.  Ribeiro’s complaint seeks injunctive relief to prevent the further inclusion and sale of the Dance Move in the games and use in promotional materials, as well as damages, including profits purportedly attributed to the misappropriation and improper use of the Dance Move and Ribeiro’s likeness.        

In the complaints, Ribeiro argues that despite first being aired more than twenty years ago, the Dance Move remains “distinctive, immediately recognizable, and inextricably linked to Ribeiro’s identity, celebrity, and likeness” and that accordingly, “the Dance [Move] has become synonymous with Ribeiro…..[and] is a part of Ribeiro’s identity.”  The complaints also note that Ribeiro filed an initial application with the United States Copyright Office on December 15, 2018 to obtain a copyright registration for the Dance Move.  Ribeiro’s complaint further alleges that the emotes constitute unlawful digital copies and derivative works of the Dance Move as well as a misappropriation of Ribeiro’s identity, and that the way the Dance Move is used creates the false implication that Ribeiro consented to the use of his likeness and endorsed the games.  Additionally, Ribeiro accuses the defendants of intentionally inducing the players of the games to perform and mark the Dance Move with hashtags referencing the games, and argues that this creates an erroneous public association between the Dance Move and the emote within the game.

Ribeiro’s claims are representative of growing pushback over the way in which the video game industry earns revenue and follows on similar claims brought by rapper 2 Milly and Russell Horning a/k/a the “Backpack Kid” over in-game uses of their respective signature dance moves, the “Milly Rock” and the “Floss.”  Many prominent musicians, including Chance the Rapper, have also grown vocal about their dislike of the exploitation of signature dance moves, noting that the songs behind the dance moves should also be included in the games so that the musicians and creatives that inspired the dances can also benefit from the revenues being generated.

If successful, the lawsuits brought by Ribeiro, 2 Milly, and Horning could significantly impact the types of micro-transactions and other in-game purchases that have become the largest revenue source and profit driver for most video game companies, particularly in light of the fact that many of the most popular video games out today, including Fortnite, are otherwise free to play.  A successful claim could also spark a wave of other celebrities and YouTube stars filing claims of their own, which could drastically impact the current profitability levels of the major video game companies. However, Ribeiro’s claims are certainly not a slam dunk.  First, the law is not clear as to whether an individual dance move, as opposed to an elaborate choreography, is actually copyrightable and so this issue is likely to play a large part in determining the outcome of the case.  Another potential setback that Ribeiro may face is the fact that in several public interviews in the past, he has openly stated that the Dance Move was “inspired by” both Courtney Cox’s dance in Bruce Springsteen’s Born to Run video, as well as Eddie Murphy’s “White People Dance”.  That the Dance Move may have been influenced by a prior dance or choreography does not mean it is not sufficiently original to avail itself of copyright protection, but it is another complicating factor that makes this case far from straightforward.  Finally, California’s Right of Publicity Statute protects a person’s name, voice, signature, photograph, and likeness, but not necessarily a person’s gestures or moves.  In determining “likeness” California courts have used the “readily identifiable” test (e.g., whether a person could reasonably determine that the use in issue depicts the plaintiff) to decide whether the right of publicity has been violated.  Thus, Ribeiro will have to show that the Dance Move is so closely intertwined with his persona that it becomes “readily identifiable” with his likeness.  It will be interesting to see how these claims progress and what kind of impact the decisions will have on the entertainment industry as a whole.        

Depp v. Bloom: Hollywood Handshake Deals May Be on the Way Out; Belt-and-Suspenders a Possible New Trend in Percentage Fee Arrangements for Legal Services

While former Judge Alex Kozinski of the Ninth Circuit once noted that “[m]oviemakers do lunch, not contracts[,]”[1] Los Angeles Superior Court Judge Terry Green’s August 28, 2018 decision in Depp v. Bloom, 2018 WL 4344241 (Cal. Sup. Aug. 28, 2018), may force legal professionals in Hollywood to skip lunch in favor of properly executed fee agreements.

In granting actor Johnny Depp’s motion to dismiss a counter-claim for breach of contract by Depp’s longtime attorney Jake Bloom in a dispute over legal fees allegedly owed to Bloom under a percentage fee agreement with Depp, Judge Green answered the question vexing entertainment attorneys for years: are percentage-based fee arrangements considered contingency fee contracts, and thus required to be in writing under California law?  Answering in the affirmative, Judge Green ruled from the bench on August 28, 2018, and issued a written decision on August 30, 2018, available here. Continue reading

Cowan, DeBaets, Abrahams & Sheppard LLP Recognized as a 2019 Tier 1 National Firm for Entertainment Law – Motion Pictures & Television by U.S. News-Best Lawyers “Best Law Firms”

Cowan, DeBaets, Abrahams & Sheppard LLP is pleased to announce it has been named a Tier 1 national firm for Entertainment Law – Motion Pictures & Television for the second consecutive year by the 9th Edition of U.S. News-Best Lawyers “Best Law Firms.” CDAS is one of only 24 firms to receive this honor. Review the full list here.

CDAS was also recognized as a Tier 1 New York City Regional Firm in the areas of Copyright Law, Entertainment Law – Motion Pictures & Television and Trademark Law.

Law firms ranked in the top-tier of the “Best Law Firms” guide are recognized for professional excellence and consistently receiving high ratings from clients and peers. The U.S. News – Best Lawyers “Best Law Firms” rankings are determined by a rigorous peer-review survey comprised of more than 7.3 million evaluations from leading lawyers, as well as client evaluations, peer reviews from top attorneys and more.

Earlier this year, six CDAS attorneys were selected for inclusion in the 25th Edition of “The Best Lawyers in America:”

Frederick P. Bimbler         Entertainment Law – Motion Pictures and Television

Susan H. Bodine                Entertainment Law – Motion Pictures and Television; Media Law

Andrea F. Cannistraci       Entertainment Law – Motion Pictures and Television

Eleanor M. Lackman         Copyright Law; Trademark Law

Stephen Sheppard             Entertainment Law – Motion Pictures and Television

Nancy E. Wolff                   Copyright Law; Trademark Law

 

 

Mega-Mergers: Impact on Business and Consumers

Following Comcast outbidding Disney for the purchase of Sky, a European satellite broadcaster, the next deal on the horizon seems to be a merger between CBS and Viacom. This comes hot on the heels of Disney’s acquisition of 21st Century Fox, and AT&T’s acquisition of Time Warner. With traditional players in the industry bulking up to counter the rise of streaming video giants such as Netflix, Amazon, Apple, and Google, the market for original content is changing in ways that will impact business and consumers alike.

  1. Branded VOD Services and Rising Costs to Consumers

Fewer companies having greater control over their product, including many beloved franchises, could mean rising costs for end users wishing to access the same variety and quality of content. Disney, for example, has withdrawn from its output deal with Netflix starting with its 2019 releases, in preparation for the release of its own streaming service. With the acquisition of Fox, Disney has added the Marvel franchise to its own considerable intellectual property holdings, which include the Avengers and Star Wars. AT&T, owner of, among other properties, Game of Thrones and Harry Potter, has recently announced plans to unveil its digital streaming service in late 2019. This model, pursued more broadly, would essentially create a handful of brand-specific streaming services. This has the potential to result in higher costs for the consumers who wish to access a wide variety of content. In the years to come, the traditional cable subscription may be remembered as a bygone bargain. Continue reading

The Good, the Bad, and the JPEG Staying Safe in the Constant Showdown over Digital Content Use Online

The ABA Section of Intellectual Property Law’s magazine Landslide published Scott J. Sholder and Lindsay R. Edelstein’s article “The Good, the Bad, and the JPEG Staying Safe in the Constant Showdown over Digital Content Use Online.”

The article is a how-to guide to prevent and defend against copyright troll claims. View Article

 

 

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