Copyright Infringement: Ninth Circuit Requires Proof of Irreparable Harm For Preliminary Injunctions

If you thought that the Perfect 10 v. Google case had been resolved long ago, you, like me, would be wrong.  Perfect 10 v. Google, 10-56316 (Ninth Circuit August 3, 2011) is the latest decision by the Ninth Circuit deciding that Perfect 10 should not get an injunction.   In this latest decision again denying Perfect 10 a preliminary injunction, the Ninth Circuit expressly adopted the Supreme Court’s logic in the EBay case which rejected a presumption of irreparable harm in a patent infringement case.  Ebay Inc v. MercExchange, 547 U.S. 388 (2006).

For some time, if a copyright owner showed ownership of a copyrighted work and showed that the defendant had engaged in unauthorized copying, courts presumed that irreparable harm had been shown and shifted the burden of proof to the defendant.   The EBay standard makes getting a preliminary injunction much tougher for copyright owners, reducing the immediate settlement value of many infringement claims.
Perfect 10 is a rather unsympathetic plaintiff, suing Google for its caching of the entire internet and its practice of sending copies of all cease and desist letters to  the Chilling Effects website.  Perfect 10 alleges that because someone could look at a cease and desist letter, then click on the link to view an unauthorized photograph, that it has lost millions of dollars, since consumers won’t pay a subscription for its soft-core pornography when it can be found for free.   At the core of most of Perfect 10’s complaints is that its own subscribers repost images on such services as Blogger.
Since Google is so useful and has adopted what appear to be reasonable anti-infringement policies, it is a sympathetic defendant.  There may be more sympathy for Perfect 10’s position to be found in an amicus brief filed by the Picture Archive Council of America and others, I didn’t dig into this.   An unsympathetic plaintiff who fails to develop a proper record may sometimes shape the law in ways that is undesirable for many others, particularly working photographers needing legitimate protections against republication of original images.  This may well be such a case.   Treating copyrights as fungible goods may not necessarily serve the best interests of society and shifting the cost burden to copyright owners may well be unfair in the case of individual authors who may well be deprived of all bargaining power in cases of legitimate and truly irreparable injury.

 www.dunnington.com
 Purchase Copyright Litigation Handbook 2010 by Raymond J. Dowd from West here  

Reaping and Sowing Copyrights: Second Circuit Finds "Hot News" Misappropriation Claim Preempted By Copyright Act

 In Barclay's Capital Inc. v. TheFlyontheWall.com, (10-1372-CV June 20, 2011), the Second Circuit found that publishing brief factual summaries of investment recommendations was not the basis for a misappropriation claim under New York law.

The defendant had already been enjoined from republishing investment reports in their entirety, this issue was not part of the appeal. The defendant continued, however, to publish very brief factual summaries of the recommendations in the investment reports. The district court's injunction blocked republication of this information for a period ranging from 30 minutes to several hours. The investment banks claimed that the information was valuable only for the morning trading and that its proprietary nature incentivated their respective clients to trade through the firm issuing the report.

Google and Twitter appeared as amici and asked the Second Circuit to repudiate the "hot news" misappropriation tort in its entirety. The Second Circuit declined to do so expressly, but reached a similar result by applying the preemption doctrine.

We conclude that in this case, a Firm's ability to make news -- by issuing a Recommendation that is likely to affect the market price of a security -- does not give rise to a right for it to control who breaks that news and how. We therefore reverse the judgment of the district court to that extent and remand with instructions to dismiss the Firms' misappropriation claim.


The case is a very important one for the future of the internet and such services as Google and Twitter. It also has strong philosophical implications with a section on the "moral dimensions" of the question replete with footnotes about the bible's competing views on reaping where one has not sown, and on the other hand, being forbidden to reap even where one has sown (see P 43 and FN 27 in the embedded opinion below).
Barclays v wall 10-1372_both

http://www.dunnington.com/rdowd_bio.html
 Purchase Copyright Litigation Handbook 2010 by Raymond J. Dowd from West here  

Google TV: A few of the future of content consumption on your television

Legal Materials Product Review: Copyright Litigation Handbook on Westlaw Next and Kindle

West publishing is rolling out Westlaw Next, a whole new way of accessing and working with content accessed through Westlaw.  Searches are a lot more intuitive, content is found through Google-type searches and can be saved to folders.   Once you've saved content to your research folders, you don't incur additional charges for accessing that content.

The Copyright Litigation Handbook was first published in 2006 and was instantly hailed as "indispensable" by the New York Law Journal.   It is updated annually and designed to be a handy volume to keep for frequent reference at deskside for the busy litigator looking for practical solutions and a quick reference to the Copyright Act, the Federal Rules of Civil Procedure, and to the cases interpreting their intersection in federal litigation practice.

Copyright Litigation Handbook was subsequently added to  the Westlaw database.  But anyone accessing Copyright Litigation Handbook on standard Westlaw had to know that the database is COPYLITIG in order to access it.   Now, if the content is relevant, it should pop up in easily accessible secondary sources pages that are better organized and easier to get at.  

If your West sales reps haven't given you the passwords to Westlaw NEXT, make sure to get the access keys, this is a tremendous time-saving product that makes it much easier to cut and paste relevant content.  A look at what the product looks like:

As you can see from the above, I went into Copyright Litigation Handbook and checked out what it had to say about default judgments.  The answers are clear and easy to read with your search remaining in the Google-type bar above.

You can see that once you are in the content, you can save to your research folder, add a note, highlight or copy with reference.   Again, much quicker and intuitive than Westlaw.  Saved folders are stored like Outlook and you can go back and view them in a really clear and intuitive manner.  In Westlaw, the research trails were annoying and confusing, I just always redid the research.   Your notes are searchable (I didn't test this feature).

Here you have a drop-down menu making it easy to email, print, download or send to your Amazon Kindle.  The Kindle format is nice, easy on the eyes book-style format.

Here you can see that viewing the outline of Copyright Litigation Handbook is again easier on the eyes.  As the text expands out, it is easier to follow where it came from and to follow it back.

Switching to full screen mode makes the text more readable.

You can add frequently-consulted texts like Copyright Litigation Handbook to your Favorites folder.

Patry's Moral Panics and the Copyright Wars: Strangled In Copyright, US Devoured By Korea

Professor William Patry, copyright's most prolific scholar and a bit of a folk devil himself, has come out with a new book that burns with the ambition of making us rethink copyright from the ground up. According to Patry, countries like Korea and Japan are far ahead of the US in technological innovation and embrace of the internet to create lucrative consumer-driven markets for copyrighted content.

If you want to know why your DVD player doesn't have a "record" button, Patry provides the best, most entertaining, and lively explanation I've ever seen.

Patry's erudition and lively writing style make for a brisk and entertaining read. His examples are interesting and compelling -and his discourses on metaphor are quite brilliant. Patry is at his best in cheerfully skewering corporate oligopolists who have successfully lobbied for laws that destroy technical innovation.

Patry plays Marc Antony to Jack Valenti's Caesar: Valenti was the head of the Motion Picture Association of America and a genius lobbyist. Valenti branded consumers as "pirates" and "thieves" for doing things like skipping commercials and mustered up populist outrage in Congress in order to grab cash and control over content for his oligopolist clients. Patry attacks these "folk devils" invented by Valenti and the "moral panics" he created and then cashed in on. Patry shows pretty convincingly that Hollywood and the RIAA have thoroughly misbehaved.

If you are interested in the debates over the past, present and future of copyright law, this is a terrific, unabashedly partisan book. Although Patry says we need to rethink copyright from the ground up as a privilege that is a creature of the legislature and a servant of the public good, I didn't find any concrete prescriptions for doing so. Patry is Senior Counsel to Google, but his book and the blog discussing his book have prominent disclaimers warning against attributing Patry's views to Google. But Patry's views are Google-friendly, to say the least and it would be pretty surprising if Google did not wholeheartedly embrace his views.

One concrete proposal that Patry supports is having the Obama Administration back a broadband initiative that would increase access and speed for consumers - essentially building a national online highway.

To bring home his point, Patry points to Korea and Japan and cites a study showing that "at this rate, it will take the United States more than 100 years to catch up with current Internet speeds in Japan".

This is after an entire book full of Patry blasting copyright owners for using dubious statistics, histrionic metaphors and "folk devils". Valenti would have liked Patry's conjuring this Asian menace - it's the same menace Valenti relied on.

Whether you agree or disagree with Patry, it's a thought-provoking book and likely to be influential with the U.S. judiciary. Despite the disclaimers, it's likely to be taken as a road map for lobbying Washington by technology companies currently shut out of lucrative markets by the content oligopolies.

Patry has created a blog to discuss his book found here. Hopefully this new blog will be a home to the lively and spirited debate that Patry is famous for.

Related articles by Zemanta

• Interview With William Patry: Understanding How The Copyright Debate Got Twisted (innovationtoronto.com)

Nondisclosure Agreements and Software Development: Where To Sue?

You are in Illinois. You file an action in state court. The adversary removes the action to federal court. In federal court, the adversary moves to transfer to California. You move to remand to state court in Illinois. The federal judge doesn't decide your remand motion, but decides to transfer the action to California. What are your options?

In re Limitnone LLC, -- F.3d---, 2008 WL 5254359 (7th Cir. December 19, 2008) gives us the answer. You may properly file a writ of mandamus. The decision on Findlaw is here. The original petition for a writ of mandamus is filed directly with the Court of Appeals, in this case the Seventh Circuit.

The factual underpinnings of the case are of great interest to software developers. Google and Limitnone signed a nondisclosure agreement ("NDA"). The NDA related to a program Limitnone had developed to move information from Microsoft Office apps to Google's competing apps. The program was called gMove. The NDA had a dispute resolution clause that venued all disputes in California.

Limitnone provided a Beta version of its program to Google. The Google employee had to click "I accept" on a "Beta License Agreement" to use the Beta version of the gMove. Months passed, and Google announced that it was launching an app that did what gMove did and would give it away for free. The Beta License Agreement specified Illinois courts and Illinois law.

The district court and Seventh Circuit found that the Beta License Agreement was not valid because it was not signed and was not in writing, and thus transferred the case to California. The odd thing is that the basis for the removal to federal court was that was that the Copright Act preempted the Illinois trade secrets statute relied on by Limitnone.

The Seventh Circuit held out the possibility that Limitnone might still make a motion for a remand.

If the action was improperly removed to federal court, then Limitnone might end up in a state court after all.

User-Generated Video Uploads Veoh, Napster, Google and Safe Harbors

In Io Group, Inc. v. Veoh Networks, Inc., No. C06-03926 (HRL), a decision dated August 27, 2008 by Northern District of California Judge Harold Lloyd, discussed by PC Magazine here, the court found that the video uploading service found at http://www.veoh.com/ is not liable for copyright infringement.

The Veoh website permits users to view and upload their own videos and to share revenues generated from advertising revenues with Veoh. Veoh automates the process, so Veoh is not engaged in reviewing content before it goes up. You can also watch television shows made available by Veoh's "content partners". I note such shows as CSI and Ugly Betty from Veoh's home page.

The plaintiff sued Veoh claiming that its copyrighted films were posted on Veoh without bothering to give Veoh notice beforehand.

The decision has a great discussion of the technology involved in the uploading and storing process. It also has a thorough discussion of Veoh's user policies and the legislative history relative to the Digital Millenium Copyright Act that provides a "safe harbor" to online service providers who take reasonable measures to ensure that they are not helping copyright infringers. There is an informative discussion of why Veoh's case differs from the facts of Napster, although the underlying facts of Napster were not fully fleshed out. In today's New York Post, the Veoh case was reported as "Copyright case may aid Google".

Judge Lloyd found Veoh's policy to be reasonable, and rejected arguments that a stronger policy which would be more effective in barring people from creating new false user names was mandated as a condition for avoiding copyright infringement liability. He rejected the argument that the possibility of a banned user creating new false user names amounted to no policy at all. He also made clear that the law was designed to permit different approaches to developing an anti-infringement policy.

Certainly, this flexible approach has to be encouraging to Google, whose policies were not 100% effective against people who actively sought to foil them.