Litigation

Copyright Office Procedures During COVID-19

By Elizabeth Altman

As COVID-19-related disruptions and social distancing measures continue across the country and throughout the summer, many public institutions are seeing continued curtailment to their operations. It can be overwhelming to parse through ever-changing, institution-specific pandemic protocols, which is why we have put together an overview of the Copyright Office’s current practices in response to the COVID-19 pandemic. This guide explores the safety and efficiency measures adopted by the Copyright Office to mitigate effects from the national emergency, and explains what that means for your registrations, recordations, research, and other copyright-related concerns.

General Background

First and foremost, the Copyright Office’s physical offices remain closed, as they—along with all Library of Congress buildings—have been since March 13 of this year. The Office is actively teleworking, however, with staff and registration specialists operating remotely to continue core Copyright Office activities, such as reviewing and processing of registrations. The Copyright Office’s emergency modifications, implemented on March 31, 2020, and discussed further below, have currently been extended through September 8, 2020.

Registrations

A central function of the Copyright Office is registering copyrighted works. During the pandemic, the Office has continued to provide this service via its online registration portal, eCO. Examiners continue to review online registrations remotely, processing electronic applications in the order in which they are received (except with respect to special handling, discussed further below). The Copyright Office strongly encourages online registration, especially considering that, given today’s copyright technology and the Copyright Office’s current procedures, most works are fully registerable online.

The main COVID-19-related disruption to registration involves physical deposits and applications, which some people prefer to use, and which are required for certain categories of works and applications as discussed below. Although the Copyright Office is still accepting physical submissions, it is currently storing them in an offsite facility, regardless of whether they were submitted by USPS, courier, or delivery service. The Copyright Office will only process these submissions when the Library of Congress reopens, for which there is presently no timeline. To date, the Library of Congress has stated that all events at its buildings are cancelled until September 1 and that all facilities remain closed “until further notice.” When the Copyright Office does resume reviewing physical materials, it will do so in the order in which they were received, as submissions have been date-stamped.

The Copyright Office therefore strongly encourages applicants to take advantage of electronic filing options. To this end, the Office has expanded its electronic submissions programs, to accommodate applications that would normally require a physical deposit copy. Below is a summary of the available submission options, depending upon the deposit requirements for the type of work:

a) Registration Where No Physical Deposit is Required:

For applicants not required to submit a physical deposit copy of the work, the Office strongly encourages uploading one electronic copy of the work after completing the electronic application and paying the required fee. No other declaration form or special procedure is required.

b) Registration Where Physical Deposit is Required:

Physical deposit copies are required for certain kinds of work, including vessel designs and mask works. They are also required when:

  • A work was first published in the U.S. before the applicant submitted an application claim to the Copyright Office, and the work was published in physical form, like a CD, DVD, or paperback book;
  • A work was first published in the U.S. before the applicant submitted an application claim, and the work was published both in a physical and an electronic form (like a song released on CD and as a download); or
  • A work was first published abroad before the applicant submitted an application claim to the Copyright Office, and the work was first published in a physical format like CD, DVD, or paperback book.

Applicants that must submit a physical deposit copy should mail it to the Copyright Office, including the shipping slip, which provides the mailing address. Although the physical deposit will not be processed until the Office returns to normal operations, applicants who also follow the Office’s special pandemic procedures—as outlined below—will receive remote examination of the electronic application: 

  1. Complete an electronic application and submit the filing fee through the online registration system.
  2. Upload an electronic copy of the work that is identical to the physical copy.
  3. Print the shipping slip generated by the eCO system and attach it to the physical deposit copy of the work that is mailed to the Copyright Office.
  4. Complete and upload a Deposit Ticket Declaration Form certifying that the physical deposit and electronic copy contain identical content.
  • Include the title of the work, which the registration specialist will use to confirm that the information in the declaration matches that in the application.
  • Sign the declaration; typed signatures suffice.
  • You need not notarize the form or have a witness.

The Copyright Office advises that where an applicant has filed an application electronically but has only submitted a physical deposit, the examiner assigned to the claim may send an email with the option of uploading an electronic copy of the work and the Deposit Form, where the option is available. Emails send from cop-ad@loc.gov. However, applicants taking note of the Copyright Office’s building closures and hold on inspections of physical material are advised to proceed with this process from the start.

Where applicants follow this procedure, the effective date of registration will be the date the Copyright Office receives the completed application, fee, and deposit in its proper form, regardless of whether the physical or electronic version first reaches the Office. Claims submitted in this manner should be examined within 30 days after the Office receives the electronic copy, although the Copyright Office generally advises that the average time to process a registration is presently 3.2 months.

The Copyright Office directs that applicants that have only submitted a paper application should not resubmit an online application; in such cases, the Copyright Office will examine the application when the building reopens and staff returns.

c) Where Applicants are Unable to Submit an Application, Fee, and/or Deposit During COVID-19

Under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed on March 27, 2020, the Register of Copyrights has the temporary authority to extend certain filing deadlines and procedural requirements if she determines that a national emergency is disrupting Copyright Office practices. The Register quickly used this authority to establish a procedure to extend the window for registrations under Section 710 of the Copyright Act, which authorizes her, on a temporary basis and subject to certain exceptions, to “toll, waive, adjust, or modify any timing provision . . . or procedural provision” in the Copyright Act if she determines that a national emergency declared by the President “generally disrupts or suspends the ordinary functioning of the copyright system . . . or any component thereof.” Considering the difficulties of prompt registration, which is generally required in order to ensure the availability of statutory damages and attorney’s fees should an infringement dispute proceed to litigation (these legal remedies are only available for works registered before infringement or, if after infringement, within three months after first publication), the Office is now allowing applicants to toll the registration window based on fulfillment of certain conditions:

  • Applicants who are unable to submit an application, fee, and/or required physical deposit copy should fill in and upload a Section 710 Declaration online (the form applies to applicants who declare that due to the pandemic they either could not submit an application fee, and/or deposit copy or could not submit a required physical deposit copy though they did submit an online application and fee; it also contains a section for the applicant’s statement supporting the declaration, and an acknowledgement of the penalties associated with making a false representation in an application for copyright registration). When possible, applicants should proceed to complete an electronic application, submit a filing fee, print a shipping slip, and mail the required deposit with the shipping slip to the address on the slip. Applicants must mail these materials within 30 days after the date that the COVID-19 disruption has ended, as announced by the Register of Copyrights.
  • Applicants that are prevented from submitting a paper or electronic application, fee, and/or required deposit may do so after the end of the national emergency, provided that they include a Section 710 Declaration with their application materials.

Section 710 Declarations must be signed—either handwritten or typed signatures suffice—and include satisfactory evidence to support the claim that the pandemic prevented the applicant from submitting required materials. The following would be suitable justifications:

  • A statement that you are/were subject to a governmental stay-at-home order.
  • A statement that you are/were unable to access required physical materials due to a business closure at the site of the materials’ storage.
  • A statement that you were unable to access the internet.

Certificates of Registration

The Copyright Office has ceased printing certificates of registrations at present. If, however, your claim has been registered, it will appear in the Office’s online catalog. You may retrieve the registration number by searching using the title, author, or claimant name. For registrations processed through Special Handling, the Office will email an unofficial copy of the registration certification that includes the registration number. If the Copyright Office refuses your claim, it will email you a copy of the refusal letter.

Special Handling

The Copyright Office’s “special handling” procedure allows applicants to expedite the registration process for an additional fee. Presently, the Copyright Office will only receive and process requests for special handling that are submitted online.

The following steps ensure special handling:

  1. Submit an electronic application completing the special handling screen.
  2. Pay the filing fee and additional special handling fee.
  3. Upload an electronic copy of your work.

If the application would ordinarily require a physical deposit, you may use the Deposit Ticket Declaration Form option to qualify for special handling.

After you complete these steps, the Office will typically examine your claim, or contact you with questions within five business days. If, however, you submit physical copies or a paper application, the Copyright Office will neither examine your materials nor implement special handling until the Library of Congress reopens. As of May 2020, the Office now also permits applicants to submit requests for special handling of document recordation submissions, including notices of termination, by email.

Requests for Reconsideration of Registration Refusal

Requests for reconsideration are typically filed by mail, but as an alternative during the pandemic, the Copyright Office will allow you to submit your request to copreviewboard@copyright.gov. After receiving your request, the Copyright Office will contact you with instructions to pay the required filing fee electronically. The request and fee must be received by the Office within three months from your refusal date.

Requesting Cancellation of Registration

To seek a voluntary cancellation of a registration, as the author or claimant of record, you may submit your request to copreviewboard@copyright.gov. A staff member will contact you about submitting the required fee.

Research & Updates

a) Library of Congress

As noted, all Library of Congress buildings and facilities have been closed to the public, including researchers and those with reader identification cards, which are required to access the Library’s research areas, including Computer Catalog centers and Copyright Office public service areas. Access to the Library of Congress is currently limited to a small number of necessary persons, although the Library notes that, as of June 22, 2020 it will implement “Phase One, Part One” of its plan to gradually restore on-site operations. This plan involves recalling around 200 staff members—approximately 5% of all staff—to onsite operations. Neither the Library of Congress nor the Copyright Office have provided a timeline for how long Phase One will last, when “Phase One, Part Two” is likely to commence, nor a prospective implementation date for Phase Two. The duration of each phase will be determined based on local conditions and the Library’s operations at each stage. All public events at the Library of Congress have been cancelled through September 1, 2020.

The public may still access Library of Congress resources at:

Copyright Office

Copyright.gov remains, of course, the main starting point for keeping up to date on copyright matters. To stay current with Copyright Office COVID-19 news, in particular, visit https://www.copyright.gov/coronavirus/. The Office’s Coronavirus FAQ, which outlines specific questions regarding registration and deposit copies, may also be of use. Subscribe to updates regarding COVID-19, as well as other copyright matters, at the Office’s NewsNet service: https://www.copyright.gov/subscribe/. Finally, the Copyright Office’s up-to-date filing options are available in chart form at https://www.copyright.gov/coronavirus/filing-options/.

We will update this post from time to time with further developments.

Second Circuit Limits Copyright Damages to Three-Year Period Before Suit

By Sara Gates

How do you square Psihoyos with Petrella, two of the most significant copyright statute of limitations cases in recent years?  Courts and attorneys alike have struggled with that question since the Second Circuit and the Supreme Court, respectively, handed down these two copyright decisions within the span of a month in 2014.  For the most part, courts have read the decisions separately, acknowledging the Petrella court’s three-year look-back period for a plaintiff’s recovery of monetary damages in a copyright action, while continuing to apply the Psihoyos court’s “discovery” rule, which extends the time when the Copyright Act’s statute of limitations period starts to run based on when the copyright owner “discovers” the infringement.

It was not until earlier this month that the Second Circuit took up the damages question in Sohm v. Scholastic Inc., No. 18-2110, 2020 WL 2375056 (2d Cir. May 12, 2020), and decided that, though the discovery rule is binding precedent in the circuit, the Supreme Court’s decision in Petrella counsels that there is a only a three-year lookback period from when suit is filed to determine the extent of monetary damages available.  Reversing the lower court’s decision on this point, the Second Circuit determined that a copyright plaintiff’s recovery is limited to damages incurred during the three years prior to filing suit.  The decision lends an advantage to copyright defendants where plaintiffs delay in bringing suit, yet still seek to recover expansive damages dating back as far as they can count. 

In the case, a photographer, Joseph Sohm, brought a copyright infringement action against Scholastic Inc., which had used 89 of Sohm’s photographs in various publications, outside the limited license granted by Sohm’s third-party licensing agent.  On cross-motions for partial summary judgment, the district court dealt with a host of copyright issues, ultimately finding that Scholastic only infringed the copyrights in six photographs.  Notably, the district court considered Scholastic’s arguments that the Copyright Act’s three-year statute of limitations barred Sohm’s claims as to certain uses of the photographs, and that Sohm’s damages should be limited to those incurred during the three years prior to filing suit.  The court rejected both of Scholastic’s arguments, finding the discovery rule adopted by the Second Circuit in Psihoyos v. John Wiley & Sons, Inc., 748 F.3d 120 (2d Cir. 2014), was still good law and that the Supreme Court’s decision in Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 663 (2014), should not be read to establish a time limit on the recovery of damages distinct from the discovery-based statute of limitations.

On cross-appeal to the Second Circuit, Scholastic urged the court to forego the discovery rule, and to instead adopt an “injury rule” (i.e., so the three-year statute of limitations period starts to run from the time of the copyright owner’s injury), to determine when Sohm’s claims accrued for statute of limitations purposes.  Citing Psihoyos as binding precedent in the Second Circuit that had not been overturned, the court disagreed with Scholastic’s position and affirmed the discovery rule, sticking with the majority of the circuit courts that have adopted the rule.  Scholastic’s second argument, however, fared better.

Asserting that, even if the discovery rule applies, Scholastic argued that Sohm still should not be able to recover damages for more than three years prior to commencement of the action, relying on language from Petrella.  Specifically, Scholastic noted that the Petrella court stated: “[u]nder the [Copyright] Act’s three-year provision, an infringement is actionable within three years, and only three years, of its occurrence” and that “the infringer is insulated from liability for earlier infringements of the same work.”  Though Sohm opposed Scholastic’s interpretation, calling it dicta, the Second Circuit disagreed, finding that this portion of the opinion was necessary to the result, so it acts as binding precedent.  Accordingly, the Second Circuit concluded that, notwithstanding the discovery rule, the Supreme Court “explicitly dissociated the Copyright Act’s statute of limitations from its time limit on damages” and “delimited damages to the three years prior to the commencement of a copyright infringement action.”  

While the Second Circuit did not adopt Scholastic’s proposed injury rule, its holding severely limits the copyright owner’s recovery when the discovery rule is applied.  For example, if an infringement occurred ten years ago, but was only recently discovered, prompting the copyright owner to file suit, the copyright owner would only be able to recover damages for the three years prior to filing, and would not be able to “look back” through the ten years since the infringement. 

In deciding that Sohm could not recover damages more than three years prior to filing suit, the Second Circuit became the first circuit to adopt this interpretation of Petrella.  Though other district courts outside the Second Circuit have addressed the issue—including a district court in the Ninth Circuit, Johnson v. UMG Recordings, Inc., No. 2:19-cv-02364-ODW, 2019 WL 5420278 (C.D. Cal. Oct. 23, 2019), which took the opposite position and permitted damages outside the three-year period—until other circuits weigh in, it is unclear whether the Second Circuit’s interpretation will become majority rule or whether a circuit split again destined for the Supreme Court is on the horizon. 

Ninth Circuit Holds First Amendment Tolerates Whiskey-Inspired Parody Dog Toys in Trade Dress Spat

By Scott J. Sholder

A legal decision that simultaneously upholds the foundational tenets of free speech while quoting a dog toy’s claim to be “43% Poo by Vol” and “100% Smelly” is a welcome spot of levity in these trying and stressful times. The Ninth Circuit offered both in VIP Products v. Jack Daniel’s Properties, Inc., a recent decision holding that the First Amendment shields parodic uses of trademarks and trade dress in consumer products.

Background

Between 2007 and 2017, VIP Products LLC (“VIP”) sold dog toys called “Silly Squeakers,” which were designed to look like bottles of well-known beverages “but with dog-related twists” – in this case, “Bad Spaniels” as a play on Jack Daniel’s. The Bad Spaniels toy, introduced in 2013, resembles a Jack Daniel’s bottle, features a picture of a dog, and sports the phrase “the Old No. 2, on your Tennessee Carpet” and the above-mentioned “alcohol” content description. (A bottle of Jack Daniel’s bears the phrases “Old No. 7 Brand Tennessee Sour Mash Whiskey.”) VIP claimed that the purpose of its toys’ design was to comment on “the humanization of the dog in our lives” and “corporations [that] take themselves very seriously.”

Jack Daniel’s Properties, Inc. (“JDP”) was apparently one of those companies and did not take kindly to VIP’s canine-inspired take on its iconic brand of spirits. In 2014 JDP wrote to VIP demanding that it “cease all further sales of the Bad Spaniels toy.” In response, VIP filed an action seeking a declaratory judgment of non-infringement or dilution of JDP’s trademark rights, a ruling that the “Jack Daniel’s trade dress and bottle design are not entitled to trademark protection,” and cancellation of JDP’s registered bottle design. JDP counterclaimed for trademark and trade dress infringement as well as trademark dilution by tarnishment.

After dueling summary judgment motions, the district court, among other rulings, denied VIP’s First Amendment defenses and confirmed the protectability of JDP’s trade dress. A four-day bench trial on JDP’s dilution claim and likelihood of confusion resulted in a ruling in favor of JDP and a permanent injunction against sales of the Bad Spaniels toy. VIP appealed to the Ninth Circuit Court of Appeals, which issued a mixed ruling, affirming the protectability of JDP’s trade dress but reversing the lower court’s ruling on the First Amendment.

Ninth Circuit Decision

The appeals court, in addressing VIP’s First Amendment defense, explained that the Lanham Act’s “likelihood of confusion” standard generally “seeks to strike the appropriate balance between the First Amendment and trademark rights,” but in the context of artistic expression, a more stringent test in favor of free speech applies because likelihood of confusion “fails to account for the full weight of the public’s interest in free expression.” The Ninth Circuit explained that it had adopted, in Mattel, Inc. v. MCA Records, a test originally promulgated by the Second Circuit in the seminal case Rogers v. Grimaldi, which dealt with protectable names used in the titles of expressive works. That test requires a plaintiff to demonstrate that a defendant’s use of the plaintiff’s name/mark in an expressive work is either (1) “not artistically relevant to the underlying work” or (2) “explicitly misleads consumers as to the source or content of the work.” The court’s analysis focused on the threshold issue of why a dog toy is considered an expressive work, the key question being whether the work “communicat[es] ideas or express[es] points of view.”

The panel explained that expressive works are “not rendered non-expressive simply because” they are sold commercially, yet do not need to be the “expressive equivalent of Anna Karenina or Citizen Kane.” The Bad Spaniels toys were expressive works because they communicated a “humorous message” through “word play to alter the serious phrase that appears on a Jack Daniel’s bottle – ‘Old No. 7 Brand’ – with a silly message – ‘The Old No. 2.'” The juxtaposition of an “irreverent representation of the trademark with the idealized image created by the mark’s owner” rendered the Bad Spaniels toy a First Amendment-protected work conveying the message that “business and product images need not always be taken too seriously.” This message was key; the vessel of the dog toy was effectively deemed irrelevant (and, the court noted, its conclusion was consistent with a 2007 Fourth Circuit decision protecting parodic dog toys based on Louis Vuitton hand bags).

As a procedural matter, the court did not address the substance of the two-prong Rogers test because the district court had not even found that Bad Spaniels was an expressive work. The court therefore vacated the lower court’s finding of infringement and remanded for an analysis of the Rogers test.

The Ninth Circuit panel went on to reverse the trial court’s ruling that VIP had diluted JDP’s trademark because noncommercial use of a mark is not dilutive, and VIP had not engaged in purely commercial speech. Specifically, VIP had done more than simply propose a commercial transaction by creating “protected expression” even though it was selling a product. Because VIP’s humorous message was protected by the First Amendment, its use of the JDP trade dress could not have diluted JDP’s brand.

The VIP case is the most recent example of the continued expansion of the Rogers test into a more encompassing First Amendment safeguard, at least in the Ninth Circuit. In 2008, the Ninth Circuit held in E.S.S. Entertainment 2000, Inc. v. Rock Star Videos, Inc., that, in the context of video games, the Rogers test applied not only to trademark use in titles of artistic works, but also to material in the body of the works. And just two years ago, in Twentieth Century Fox Television v. Empire Distribution, Inc., the court held that Fox’s use of the name “Empire” for its hit TV show was protected by the First Amendment against claims of trademark infringement by record label Empire Distribution, opening the Rogers umbrella to cover Fox’s promotional uses of the “Empire” mark for live musical performances, cast appearances, and on consumer goods like T-shirts and champagne glasses. The VIP decision represents a predictable next step of expansion of the Rogers doctrine out of the realm of creative media properties like television and video games (for which merchandising is ancillary) to consumer goods as a distinct category of creative expression.

VIP is a clear victory for creators of expressive works, reinforcing the importance of balancing trademark rights with artistic expression and the ability of creators of even garden-variety consumer products to make a living from the fruits of that expression. Brand owners, on the other hand, will likely see the decision as a weakening of trademark protections and a blank check for content creators to profit from uses of marks outside traditional artistic content. Of course, VIP is only binding in the Ninth Circuit, but it stands to reason that other like-minded courts such as the Second Circuit (originator of the Rogers test) and the Fourth Circuit (which addressed the Louis Vuitton dog toy case mentioned above) may follow suit. While creators of expressive products may take some more comfort in their First Amendment rights, trademark proprietors should carefully assess the facts of brewing disputes, especially in these circuits, before asserting claims. And, particularly with parody products, brand owners should consider whether litigation is the best solution or if there are other compromises like disclaimers or outside-the-box business solutions.

This article was published by the Media Law Resource Center (MLRC) on May 6, 2020

Supreme Court Rejects Willfulness Requirement for Profit Awards in Trademark Infringement Actions

By Sara Gates

In a recent decision of considerable importance for trademark practitioners, the U.S. Supreme Court finally resolved a longstanding split among the circuits when the Court held that willfulness is not required to award the plaintiff profits in a trademark infringement action. Romag Fasteners, Inc v. Fossil, Inc., No. 18-1233, 2020 WL 1942012 (U.S. Apr. 23, 2020). Justice Gorsuch delivered the majority opinion in the unanimous decision, expressly rejecting the willfulness prerequisite to profit awards adopted by the Second and Ninth Circuits, which both handle a high volume of the nation’s trademark cases.

Background

The case before the Court involved a dispute over handbag fasteners between Romag Fasteners, Inc., a company that manufacturers the fasteners, and Fossil, Inc., a company that uses the fasteners on its handbags. For years, Romag and Fossil worked together under an agreement that permitted Fossil to use Romag’s fasteners on its handbags. As Romag later discovered, however, factories in China making Fossil products were using counterfeit fasteners, instead of Romag’s products. Believing that Fossil was not policing these factories, Romag sued Fossil for trademark infringement and false representation (along with other claims, including patent infringement).

The issues of fact went to the jury, which agreed with Romag’s view and found that, while Fossil had acted with callous disregard, its actions were not willful. Though the jury made its advisory awards, the Judge Janet Bon Arterton of the U.S. District Court for the District of Connecticut determined that Romag could not recover Fossil’s profits on the trademark infringement claim without a finding of willfulness. On appeal to the Federal Circuit, the Court upheld the district court’s decision, finding that it was consistent with Second Circuit precedent (the District of Connecticut sits within the Second Circuit). Romag’s writ of certiorari to the Supreme Court followed, and the Court granted the writ, presumably to resolve the outstanding circuit split that has persisted for more than 20 years.

Decision

The Court did just that in its recent decision, which fully and finally rejected the view that a showing of willfulness is a prerequisite to a profit award in trademark infringement actions. As the Court explained, while the infringer’s state of mind is certainly an important and valuable consideration, it is by no means a requirement for a court to award a trademark owner the infringer’s profits.

In reaching the decision, the Court relied heavily on the text of the Lanham Act, the statute governing recovery of federal trademark violations, and, specifically, 15 U.S.C. § 1117, the Lanham Act’s damages provision. The Court pointed out that states of mind, or mens rea, are carefully addressed in that section of the statute, as they are throughout the entirety of the Lanham Act. For example, the plain text of § 1117(a) provides for recovery of an award of the infringer’s profits for any violations of 15 U.S.C. § 1125(a) (i.e., trademark infringement), but for violations of § 1125(c) (trademark dilution) the statute clearly requires a willful violation for such an award:

When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office, a violation under section 1125(a) or (d) of this title, or a willful violation under section 1125(c) of this title, shall have been established in any civil action arising under this chapter, the plaintiff shall be entitled, subject to the provisions of sections 1111 and 1114 of this title, and subject to the principles of equity, to recover (1) defendant’s profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action. . . .

17 U.S.C. § 1117(a) (emphasis added).

The Court determined that the use of the term “willful” in one instance in § 1117(a), but not in another, indicated Congress’ intent with regard to how mental states should be treated vis á vis profit awards for particular violations. Likewise, in other sub-sections of § 1117, mental states are included judiciously in certain instances, but not others. As the Court, in its interpretation of the law, is careful not to read words into statutes that are not present, it declined to adopt the Second and Ninth Circuit’s interpretations and read in a “willful” requirement for violations of § 1125(a).

The Court similarly rejected other arguments lodged by Fossil, again turning to the text of the statute. For instance, Fossil argued a profit award was appropriate pursuant to “principles of equity” in § 1117(a). The Court discussed the definition and meaning of “principles of equity,” finding it unlikely that Congress intended for this language to denote such a narrow rule regarding profit awards. Even considering pre-Lanham Act case law, the Court again noted that there was no clear rule regarding a willfulness prerequisite, leading the Justices to the conclusion that, at most, mens rea was an historically important consideration in awarding profits but never a requirement. As the Court pointed out, the importance of mens rea has continued under the Lanham Act, as reflected in the provision of greater statutory damages for willful violations in § 1117(c). Finally, the Court briefly rejected Fossil’s policy argument, stating that the Court would instead leave the policy decisions to the policymakers in Congress.

With this decision, trademark plaintiffs will face one less obstacle when establishing their entitlement to an award of a defendant’s profits. In practical terms, courts will likely see fewer motions for summary judgment on willfulness, as defendants may no longer use this tool to foreclose a plaintiff’s ability to obtain the defendant’s profits. Though the Court’s decision that courts may award profits absent a finding of willfulness may, in theory, open the doors to more profit awards, it is unlikely to result in windfalls to plaintiffs. As courts have long recognized, the infringer’s state of mind bears on the relief the trademark owner should receive.

The Supreme Court echoed the well-established notion that an infringer’s state of mind bears on the relief the plaintiff should receive when it clearly articulated that a defendant’s mental state “is a highly important consideration in determining whether an award of profits is appropriate” in trademark infringement actions. Romag, 2020 WL 1942012, at *4. There is just no particular mental state required for profit awards, so it remains in the discretion of the courts, and juries, to determine what is appropriate under the circumstances.

This article was published by the Media Law Resource Center (MLRC) on May 6, 2020

Content in Quarantine: Copyright Best Practices During a Pandemic

By Scott J. Sholder

At a time when we are stuck at home, working or “working” (or, sadly for many, not working) the tenet that content is king has never been more relevant.  From Disney+ releasing “Frozen II” and “Onward” early to help placate restless youngsters, to DreamWorks releasing “Trolls World Tour” for “theatrical” in-house rental, to Instagram sensation DJ D Nice offering his “Club Quarantine” and “Homeschool” IG parties and Spotify playlists, there is something for everyone on one platform or another.  Musicians are even offering special live-streamed performances from their homes (thank you Dave Grohl, Billy Joe Armstrong, et al.).

While the Disney and DreamWorks releases were clearly authorized corporate decisions, the world of quarantine content becomes murkier when one turns their overly scrubbed fingers to the keyboard.  Of course, the lead singers of Foo Fighters and Green Day, respectively, likely have the rights to publicly perform music they wrote, and reports indicate that DJ D Nice made licensing deals to avoid copyright claims stemming from his streaming discotheques.  But in the further corners of social media, the always-gray field of copyright has spawned more than its usual fifty shades in the time of COVID-19.  So, what about musicians performing other artists’ songs?  Fitness instructors on Instagram Live with their playlists thumping in the background?  The Internet Archive[i] offering its own “Emergency Library” of digital copies of books (a decision decried by the Authors Guild and Association of American Publishers, but claimed to be fair use by archive.org)?  Or DJs who, unlike DJ D Nice, did not have permission to publicly perform or remix the music featured during that IG virtual dance party?

At least in the latter case, some DJs and performers streaming on Instagram Live have reported that they’ve had their streams cut short by copyright infringement claims over use of musical content without authorization.  Lesser-known and aspiring artists (who, like many, are out of work at this time) are having their online raves canceled mid-performance.  But at the same time, artists whose content is being used may also be out of work and may be incentivized, perhaps more than usual, to enforce their copyright rights and preserve their dwindling income streams.  This presents a sensitive nuance to an already delicate balance between online content usage and rights enforcement. 

There is no timelier example of COVID-era copyright enforcement than Richard Liebowitz, the infamous plaintiff’s lawyer behind more than 2,000 copyright infringement lawsuits filed by photographers over the last four years.  His business model – which he characterizes as fighting for photographers’ rights, and much of the digital media industry characterizes as “trolling” – has, like COVID-19, mutated to adapt to its new circumstances.  It was recently reported[ii] that, despite quarantine and widespread isolation (or perhaps because of it), Liebowitz’s filings have actually increased, with his firm filing 51 lawsuits between mid-March and early April (39% of all copyright infringement lawsuits filed since the World Health Organization declared a global pandemic).[iii]  Likewise, porn studio Strike 3 Holdings is also keeping busy during the pandemic, having filed a more modest 11 new lawsuits since mid-March.[iv]  The uptick in these types of cases is potentially correlated to the increased use of content during quarantine and the reduced number of opportunities for photographers and other content creators to earn a living.  So, what’s a pandemic hermit to do?

The short answer: the same thing you’d do in pre-COVID life.  Even in these strange times of social distancing and mandatory isolation, the same rules apply even when unauthorized content use is undertaken for seemingly laudable reasons such as alleviating boredom, distracting your kids, or entertaining your Instagram followers.  For better or for worse, there is no exception in the Copyright Act for what’s going on out there, so vigilance in defense as well as enforcement is paramount.  For instance, the test for fair use set out in section 107 of the Copyright Act of 1976 requires a lot more than benevolence in alleviating boredom or even supplementing one’s income during hard times to successfully fend off a claim of infringement.  One of the keys to establishing a viable fair use defense is “transformative use” – use of existing content that adds new expression, meaning, or message to the original underlying work.  Simply using the content as intended, even in an unprecedented environment, almost certainly will not be considered transformative.  As tempting as it may be to utilize others’ content for a seemingly good cause, good intentions do not a fair use make. 

Best practices for content usage remain largely unchanged.  The first-tier best solution is to use vetted licensed content (ideally pursuant to representations, warranties, and indemnification from the licensor) or seek permission, preferably in writing, directly from the copyright owner.  There are plenty of options out there for many types of content.  Licensing agencies like Getty Images, Shutterstock, Adobe, and Pond5 are stalwarts for visual content.  Many book and journal publishers are now offering resources[v] for newly minted home teachers.  Creative Commons licenses and use of public domain material are also viable options, particularly for photographic content, although may be less useful for things like popular music and are not always fool proof.  Music licensing is a unique beast that could fill an entire treatise, but suffice it to say that several licenses may be required depending on the nature of the use, including public performance licenses from performing rights organizations like ASCAP, BMI, SESAC, and Global Music Rights, “mechanical” licenses from music publishers and “master use” licenses from labels when content is downloadable, and synchronization licenses from publishers and record labels for music that is cued up with accompanying video content.  It’s certainly worth noting that some sites offer royalty-free and low-cost licensable music, such as Freeplay Music, Audioblocks, and Free Music Archive, without the added worry of the music licensing labyrinth.

Reliance on defenses like fair use should be a last resort, and in such cases, it is always wise to seek advice from an experienced copyright lawyer.  And, on the other side of the equation, if you believe your content is being used in a way that violates your copyright rights, platforms like YouTube and Instagram have DMCA takedown forms for removal of infringing content, but recent developments in the law require at least some consideration of whether the user has potential defenses (such as fair use) before submitting a takedown notice.

As we stay vigilant against the virus that is causing so much havoc worldwide, we must also make sure that we stay within the bounds of the law and mitigate our legal risks as we mitigate our health risks.  While troubled times such as these call for cooperation, collaboration, forgiveness, and flexibility, absent content owners and users working together to reach mutually beneficial arms-length deals, or the creation of a collective effort to allow free use of IP like that of Open COVID Pledge[vi] for health-based patents and technology, the rules remain as they were even if the world outside doesn’t.   

This article appeared in the May 1st issues of LAW360 Intellectual Property, LAW360 Media & Entertainment, and LAW360 Coronavirus.


[i] “Announcing a National Emergency Library to Provide Digitized Books to Students and the Public,” Internet Archive Blogs (Mar. 24, 2020), https://blog.archive.org/2020/03/24/announcing-a-national-emergency-library-to-provide-digitized-books-to-students-and-the-public/

[ii] Bill Donahue, “During Pandemic, Prolific Copyright Lawyer Keeps Suing,” Law360 (Mar. 27, 2020), https://www.law360.com/ip/articles/1257593/during-pandemic-prolific-copyright-lawyer-keeps-suing?nl_pk=db11a53e-b04f-44a7-96e1-76824544133d&utm_source=newsletter&utm_medium=email&utm_campaign=ip

[iii] See id.

[iv] See id.

[v] “What Publishers Are Doing to Help During the Coronavirus Pandemic,” Association of American Publishers, https://publishers.org/aap-news/covid-19-response/

[vi] Open Covid Pledge (Apr. 7, 2020), https://opencovidpledge.org/

Three Tips for Broadway Producers Recording their Shows for Streaming Platforms

By Frederick Bimbler and Marc Hershberg

Broadway producers interested in recording musicals for streaming platforms should pay attention to a new lawsuit.

The complaint was filed by Chapman Roberts, a Broadway music arranger, and alleges that a team of Broadway producers entered into an agreement with the plaintiff in 1994 to make original vocal arrangements of some famous songs from Jerry Leiber and Mike Stoller for their musical revue, Smokey Joe’s Café. According to the complaint, the contract stated that Roberts’ arrangements in the show could not be performed, transcribed, recreated, copied, published, or recorded without his permission.

But, according to the complaint, in 1999, Broadway Television Network recorded a couple of performances of the Tony Award-nominated show without Roberts’ permission.

“When Roberts learned of this, he contacted BTN, and BTN then asked retroactively for permission to commercially distribute the recording of the [m]usical to the public,” his lawyers claim. But, it is alleged that no agreement was ever reached, and Broadway Television Network broadcast the recording as several pay-per-view events and then licensed it for distribution through BroadwayHD, a video on-demand service for musicals and plays.

More recent digital streaming licenses of the recording purportedly have occurred, and in October, Roberts sued Broadway Television Network, BroadwayHD, and several other related parties in federal court, alleging direct and contributory copyright infringement and the intentional and knowing distribution of false Copyright Management Information.         

The merits of this lawsuit aside, which the court will decide in due course, Broadway producers should bear in mind the following three lessons from the allegations in the lawsuit.

1.     When creating an audiovisual recording of a theatrical production, Broadway producers should be certain to obtain all of the necessary rights. Experienced entertainment attorneys can help producers determine which rights are necessary and who owns them – and then negotiate the deals for those rights.

2.     The rights to various protectible elements required to perform a work on stage do not necessarily include the right to create and exploit an audiovisual recording of the same work on stage. While some contracts might include provisions that address audiovisual productions, for many elements of a theatrical production, it is likely that the audiovisual rights will need to be granted in a separate license agreement.

3.     If Broadway producers cannot successfully obtain all of the necessary rights for an audiovisual recording of a theatrical production, then they should not proceed with distributing the recording. Missing some of the necessary rights will frustrate deals with distributors who do their homework, and the recording might result in a lawsuit, like this lawsuit involving Smokey Joe’s Café.

The case is Chapman Roberts v. BroadwayHD LLC et al., Index No.: 1:19-cv-9200 (S.D.N.Y. Oct. 4, 2010).

CDAS IP Group and Partner Nancy Wolff Recognized in Chambers USA 2020


The highly regarded “Guide to the Top Lawyers and Law Firms” described CDAS as a “highly skilled boutique offering excellent capabilities handling trademark and copyright infringement cases, as well as substantial portfolio management matters. [CDAS] exhibits expertise acting for market-leading entertainment, media and digital platform clients.” In addition to recognizing the firm for Intellectual Property: Trademark, Copyright & Trade Secrets (New York), Nancy Wolff was also recognized as “a leading attorney in IP issues relating to digital media, counseling clients in a broad range of matters including disputes and licensing.”


Nancy Wolff Featured in ABA Grassroots Initiative Discussing the CASE Act

As part of ABA Day, Nancy participated in a CASE Act Introduction and discussed implications of The Copyright Alternative in Small-Claims Enforcement (CASE) Act of 2019 and its creation of the Copyright Claims Board as an alternative forum to pursue low-value claims of $30,000 or less. Listen to the panel here.

S.D.N.Y. Holds that Publishers May Embed Content Publicly Posted on Instagram Platform — (Sinclair v. Ziff Davis, LLC et al.)

By Lindsay Edelstein

Since the emergence of social media, courts, content creators, and publishers alike have been grappling with legal issues concerning the practice of “embedding” copyrighted content.  Following the controversial February 2019 decision in Goldman v. Breitbart News, LLC – rejecting the Ninth Circuit’s “server test” and holding that an embed constitutes a “public display” exposing a content user to liability under the Copyright Act – the pendulum had seemingly swung in favor of content owners, creators, and licensors. 

Yesterday, however, Judge Kimba Wood of the U.S. District Court for the Southern District of New York, issued a ruling in Sinclair v. Ziff Davis, LLC et al, providing publishers and other content users with a defense to alleged copyright infringement premised on the practice of embedding in the context of social media platforms: a valid sublicense granted to the user by Instagram via the interrelated agreements available on its platform. 

Sinclair, a professional photographer, publicly shared her copyrighted photograph “Child, Bride, Mother/Child Marriage in Guatemala” on her public Instagram page, which was viewable by anyone.  Media and entertainment platform Mashable made an offer to license the photograph from Sinclair for use in an article entitled “10 female photojournalists with their lenses on social justice.”  Sinclair rejected Mashable’s offer, but Mashable proceeded to use Instagram’s application programming interface, or “API,” to embed Sinclair’s original Instagram post in its article.  The embed frame of Sinclair’s Instagram post, as it appeared in the Mashable article, was hosted on Instagram’s servers, linked back to Sinclair’s Instagram page, and included the photograph, Sinclair’s original caption, and the date of the original post.  The Mashable article specifically discussed Sinclair and her work above the embed.  Sinclair filed suit against both Mashable and its parent company Ziff Davis, LLC for copyright infringement.

Mashable’s chief argument was that Instagram’s integrated agreements (i.e., its Platform Policy, Terms of Use, and Privacy Policy) clearly granted it a sublicense to display the photograph.  Indeed, the Terms of Use stated that, by posting content to Instagram, the user “grant[s] to Instagram a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to the Content that you post on or through [Instagram], subject to [Instagram’s] Privacy Policy.”  Pursuant to Instagram’s Privacy Policy, users can revoke Instagram’s sub-licensable right by designating the content at issue as “private.”  Because Sinclair posted the photograph publicly, Judge Wood opined, “Plaintiff made her choice.  This Court cannot release her from the agreement she made.” 

While the Court conceded that Instagram’s integrated agreements could be more concise and accessible, it declined to accept Sinclair’s contention that the agreements were unenforceable because they were purportedly “circular,” “incomprehensible,” and “contradictory.”

Judge Wood also touched upon a real dilemma faced by professional photographers: deciding whether to remain in “private mode” on one of the most popular public photo sharing platforms in the world, or to promote and share work publicly.  On the one hand, sharing content publicly allows widespread exposure and can be effectively used to market and promote one’s work.  Indeed, many photographers today use Instagram as a digital portfolio, showcasing their works to the masses.  On the other hand, if sharing content publicly grants a valid sublicense to publishers of digital content, the licensing value of such content may be diminished.

This holding is likely to send shock waves throughout the creative community as rights holders may be forced to rethink how they make their works available to the public.  Alternatively, for publishers and media entities, it allows use of publicly available content provided the publisher uses the embed API that links directly back to the Instagram account user’s full Instagram page. 

As with the Goldman case, the Sinclair holding is not binding on other courts and does not create a per se rule with respect to the practice of embedding, and each case will likely depend on the specific circumstances present. In Goldman, the photographer never posted to Twitter, but rather shared his image of Tom Brady in a private Snapchat, with one friend capturing a screen grab and further distributing it on the Twitter platform.  Twitter’s terms, unlike Instagram’s, do not grant publishers a sublicense to embed using the Twitter environment.  Users of content should note that the Instagram Privacy Policy requires the user to obtain consent before using content in an ad.

Moving forward, courts will likely consider the terms of service (including the content owner’s choice of privacy settings) and the type of embedding at issue (i.e., the “framing” of standalone images as in Goldman, versus the prototypical “embedding” using Instagram’s API as in Sinclair).  Courts may also consider the context of the use at issue as well, such as whether the use of the image transformed the purpose of the original work, or whether it is merely illustrative of the article.   Before considering embedding any content, publishers should carefully review all relevant terms of service and seek legal counsel as platform policies are not uniform and there is uncertainty in the law.

Allen v. Cooper: Supreme Court Upholds State Sovereign Immunity in Copyright Row Over State’s Unauthorized Use of Videos and Images of Blackbeard’s Famed Shipwreck

By Lindsay R. Edelstein

In a technical win for states facing federal claims under the Copyright Act, on Monday, March 23, 2020, the United States Supreme Court struck down the Copyright Clarification Act of 1990 (the “CRCA”), which had allowed states to be sued in federal court for copyright infringement.  Allen v. Cooper, No. 18-877, 2020 WL 1325815 (U.S. Mar. 23, 2020).  The Supreme Court, however, did not foreclose the possibility of later abrogating such sovereign immunity, should Congress draft a tailored, constitutional statute addressing infringement by states.  The decision is available here.

The underlying action was brought by videographer Frederick Allen, who was hired by marine salvage company Intersal, Inc. to document the recovery of Queen Anne’s Revenge, a vessel commandeered by Edward Teach (better known as Blackbeard), and shipwrecked nearly 300 years ago off the North Carolina Coast.  Allen registered the copyrights in all his works created during the ten-year excavation with the U.S. Copyright Office, including videos and photographs of guns, anchors, and other remains on the ship.

The state of North Carolina, which had engaged and contracted with Intersal to conduct the recovery efforts but did not have authorization or a license to use certain of Allen’s works, published some of Allen’s photographs and videos online and in a newsletter.  In response to the unauthorized publications, Allen sued the state for copyright infringement in federal district court.

North Carolina moved to dismiss, invoking the doctrine of sovereign immunity, which precludes federal courts from hearing suits brought by individuals against nonconsenting states.  According to Allen, however, the doctrine was abrogated in the copyright context by Congress with its enactment of the CRCA, which provides, in pertinent part, that states “shall not be immune, under the Eleventh Amendment [or] any other doctrine of sovereign immunity, from suit in Federal court” for copyright infringement.  17 U. S. C. § 511(a).  The district court agreed with Allen and denied North Carolina’s motion. 

North Carolina appealed the case to the U.S. Court of Appeals for the Fourth Circuit, which reversed the district court’s ruling, relying heavily on Florida Prepaid Postsecondary Ed. Expense Bd. v. College Savings Bank, 527 U. S. 627 (1999), which had repudiated the Patent and Plant Variety Protection Clarification Act (“Patent Remedy Act”); the Patent Remedy Act was modelled after the CRCA with identical language concerning sovereign immunity. While the district court had conceded that Florida Prepaid precluded Congress from using its Article I powers (the power to “[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries”) to take away a state’s sovereign immunity, it opined that abrogation of a state’s immunity could still be achieved under Section 5 of the Fourteenth Amendment, which authorizes Congress to “enforce” the commands of the due process clause. 

In reversing the district court’s ruling, the Fourth Circuit cited the requirement that a Section 5 abrogation be “congruent and proportional” to the Fourteenth Amendment injury.  Because the Supreme Court had previously rejected Congress’s attempt, in the Patent Remedy Act, to abolish the states’ immunity in patent infringement suits, the Fourth Circuit held that there was nothing to distinguish the situation in Allen in the context of copyright, which involved a statute with identical language, and related allegations of intellectual property infringement.  

In an opinion authored by Justice Kagan, the Court unanimously sided with the Court of Appeals, holding that “Florida Prepaid all but prewrote our decision today.”  The Court agreed that Article I did not give Congress the authority to enact the CRCA, per the reasoning in Florida Prepaid.  While Allen argued that the Court’s post-Florida Prepaid decision in Cent. Virginia Cmty. Coll. v. Katz, 546 U.S. 356 (2006) – abrogating sovereign immunity with respect to Article I’s bankruptcy clause – changed the analysis, the Court distinguished Katz as “a good-for-one-clause-only holding” that only concerned the bankruptcy clause.  

The Court’s central issue with the CRCA was informed by language found in Section 5 of the Fourteenth Amendment which requires that Congress enforce limitations on states’ authority when they violate due process with “appropriate legislation.”  The word “appropriate” in this context has been interpreted to mean that there must be “a congruence and proportionality between the injury to be prevented or remedied and the means adopted to that end.”  Because, the Court explained, an infringement must be intentional, or at least reckless, to come within the reach of the due process clause, and because the CRCA would impermissibly abrogate states’ sovereign immunity for merely negligent infringement or honest mistakes (which would not violate due process, according to the Court), the CRCA was unconstitutional.  

Allen asserted that the CRCA’s legislative record – namely, a 1988 report by the then-Register of Copyrights arguing that individuals would suffer immediate harm if they were unable to sue infringing states in federal court – was enough to distinguish it from the Patent Remedy Act at issue in Florida Prepaid.  But the Court found the purported evidence of states’ infringement in that legislative record to be unimpressive because, despite undertaking an exhaustive search, the Register only came up with a dozen possible examples of state infringement, some of which were not corroborated.  The CRCA, the Court opined, was enacted to “guard against sloppiness,” not correct constitutional wrongs, and this justification was not sufficient to withstand constitutional scrutiny. 

Significantly, the Court did leave an opening for Congress to pass a valid copyright abrogation law and “effectively stop states from behaving as copyright pirates” or “digital Blackbeards” in the future, if it “appreciate[s] the importance of linking the scope of its abrogation to the redress or prevention of unconstitutional injuries – and of creating a legislative record to back up that connection.”

While the Allen decision certainly sets a limitation on an individual’s ability to prosecute certain copyright claims, it has left the door open for Congress to draft a statute abrogating state sovereign immunity where a state’s infringement is intentional or reckless.  Furthermore, because such a determination is often fact-specific, if such a statute is enacted, federal courts may see an increase in cases filed against states that proceed, at the very least, to the discovery stage.  But for now, copyright owners do not have any recourse against states for copyright infringement, which likely will cause concern to publishers and others in the creative community as to whether state governments will take advantage of the safe passage the Court has provided them at least in the short run.

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