Second Circuit - Joint Authorship in Copyright Law: Time-Barred Copyright Ownership Claims Bar Later Copyright Infringement Claims

In Kwan v. Schlein, (2d Cir. Jan. 25, 2011)(decision below), the Second Circuit determined that a time-barred copyright ownership claim barred a later copyright infringement claim.   The decision sorts through the facts involving an editor (Kwan/appellant) who was offered co-author credit by a book publisher.  The book's author protested.  The book was published, giving the editor no authorship credit, with copyrights registered in the author and publisher's name.   This publication, together with the author cashing a royalty check, was held to trigger a three-year statute of limitations on a copyright ownership claim.   Once the editor failed to pursue the ownership claim in a timely manner, her right to pursue any copyright infringement claims was cut off.

Once the defendant got summary judgment on the editor's claims, he voluntarily dismissed his counterclaims pursuant to Rule 41(a) of the Federal Rules of Civil Procedure without prejudice with leave of court.   Editor/Kwan attacked the district court's appoval of the without prejudice dismissal.

The Second Circuit analyzed the factors permitting such a without prejudice dismissal.  In this case, the defendant's representation that he would not pursue the counterclaims unless he was sued again if Kwan won the appeal and that the counterclaims had been asserted as a defensive measure in the first place were sufficent to satisfy the Zagano factors referenced in the court's opinion.

The defendant's voluntary dismissal of its counterclaims was a neat trick:  it forced Kwan to bear the burden of appealing, rather than proceeding to a trial on the counterclaims.

I deal with issues involving statutes of limitations in Chapter 5:  Calculating Dates Prior To Commencing Litigation in Copyright Litigation Handbook.   Chapter 8:  Copyright Ownership and Licensing Litigation delves further into issues of authorship and ownership.

More on Copyright Litigation Handbook on Westlaw here

More on Copyright Litigation Handbook contents here

Kwan v Schlein decision below.
Copyright Litigation - Kwan v Schlein

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

Criminal Copyright Infringement - Counsel Must Know of Statute of Limitations Defenses To Enter Plea Agreement

 In United States v. Boyd, 2011 WL 285196 (2d Cir. Jan. 31, 2011), the Second Circuit vacated the district court's decision that a defendant did not have ineffective assistance of counsel in negotiating a criminal copyright infringement plea agreement.   The Defendant tried to vacate his guiltly plea by claiming that his counsel was unware of the five-year statute of limitations applicable to criminal copyright infringement claims.

United States v Boyd

18 U.S.C. § 2319. Criminal infringement of a copyright

(a) Any person who violates section 506 (a) (relating to criminal offenses) of title 17 shall be punished as provided in subsections (b), (c), and (d) and such penalties shall be in addition to any other provisions of title 17 or any other law.
(b) Any person who commits an offense under section 506 (a)(1)(A) of title 17—
(1) shall be imprisoned not more than 5 years, or fined in the amount set forth in this title, or both, if the offense consists of the reproduction or distribution, including by electronic means, during any 180-day period, of at least 10 copies or phonorecords, of 1 or more copyrighted works, which have a total retail value of more than $2,500;
(2) shall be imprisoned not more than 10 years, or fined in the amount set forth in this title, or both, if the offense is a felony and is a second or subsequent offense under subsection (a); and
(3) shall be imprisoned not more than 1 year, or fined in the amount set forth in this title, or both, in any other case.
(c) Any person who commits an offense under section 506 (a)(1)(B) of title 17—
(1) shall be imprisoned not more than 3 years, or fined in the amount set forth in this title, or both, if the offense consists of the reproduction or distribution of 10 or more copies or phonorecords of 1 or more copyrighted works, which have a total retail value of $2,500 or more;
(2) shall be imprisoned not more than 6 years, or fined in the amount set forth in this title, or both, if the offense is a felony and is a second or subsequent offense under subsection (a); and
(3) shall be imprisoned not more than 1 year, or fined in the amount set forth in this title, or both, if the offense consists of the reproduction or distribution of 1 or more copies or phonorecords of 1 or more copyrighted works, which have a total retail value of more than $1,000.
(d) Any person who commits an offense under section 506 (a)(1)(C) of title 17—
(1) shall be imprisoned not more than 3 years, fined under this title, or both;
(2) shall be imprisoned not more than 5 years, fined under this title, or both, if the offense was committed for purposes of commercial advantage or private financial gain;
(3) shall be imprisoned not more than 6 years, fined under this title, or both, if the offense is a felony and is a second or subsequent offense under subsection (a); and
(4) shall be imprisoned not more than 10 years, fined under this title, or both, if the offense is a felony and is a second or subsequent offense under paragraph (2).
(e) (1) During preparation of the presentence report pursuant to Rule 32(c) of the Federal Rules of Criminal Procedure, victims of the offense shall be permitted to submit, and the probation officer shall receive, a victim impact statement that identifies the victim of the offense and the extent and scope of the injury and loss suffered by the victim, including the estimated economic impact of the offense on that victim.
(2) Persons permitted to submit victim impact statements shall include—
(A) producers and sellers of legitimate works affected by conduct involved in the offense;
(B) holders of intellectual property rights in such works; and
(C) the legal representatives of such producers, sellers, and holders.
(f) As used in this section—
(1) the terms “phonorecord” and “copies” have, respectively, the meanings set forth in section 101 (relating to definitions) of title 17;
(2) the terms “reproduction” and “distribution” refer to the exclusive rights of a copyright owner under clauses (1) and (3) respectively of section 106 (relating to exclusive rights in copyrighted works), as limited by sections 107 through 122, of title 17;
(3) the term “financial gain” has the meaning given the term in section 101 of title 17; and
(4) the term “work being prepared for commercial distribution” has the meaning given the term in section 506 (a) of title 17.


















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

Graham v. Haughey: Prejudgment Interest Granted on Old "Secret" Infringements

What happens when you in 2005 for infringements that you didn't know about running from 1992 through 2004? Usually, the three-year statute of limitations of the Copyright Act will preclude you from a remedy.  17 USC 507(b).  But what if the infringements were secret and concealed from you as a trade secret?

I wrote about the Graham v Haughey case here . End result, infringer whacked for 20 million clams.

But do you get prejudgment interest? Another $4.2 million smackers, the May 12 decision below.  The $20 million judgment below that.

Graham v Haughey - Prejudgment Interest Granted on Old "Secret" Infringements

New! Copyright Law for the General Practitioner Update - CLE on the Web Available on Lawlines

New copyright law update available through Lawlines here.

Raymond Dowd, Dunnington, Bartholow & Miller, LLP

Joseph Peterson, Kilpatrick Stockton LLP
David J. Wolfsohn, Woodcock Washburn

Program Chair:

Raymond Dowd, Dunnington, Bartholow & Miller, LLP

Description:

Learn from experienced litigators about the basics of copyright law and practice, including assignments, licensing, recording security interests, dealing with the Copyright Office, pre-litigation due diligence and litigation.

Lecturer Bios
David Wolfsohn, a trial lawyer, has tried numerous copyright, patent, trademark, unfair competition, and trade secret cases. On behalf of plaintiffs, he has obtained multimillion dollar verdicts and settlements, including a $19 million jury verdict in June 2006 in a copyright case (The Graham Company v. US! MidAtlantic) and a $5.8 million settlement of a trade secret case.


After graduating cum laude and order of the coif from the University of Chicago Law School in 1988, David served as a law clerk to the Honorable Walter K. Stapleton of the United States Court of Appeals for the Third Circuit. He then worked at a Philadelphia litigation firm for 16 years, handling commercial, governmental, and intellectual property disputes. David joined Woodcock Washburn in 2005, where he litigates intellectual property cases.

David was also lead counsel (pro bono) in the landmark case Nixon v. Commonwealth, in which the Pennsylvania Supreme Court struck down as unconstitutional a Pennsylvania statute barring persons convicted of minor crimes decades ago from all jobs in health care related fields. For this representation, David received the Equal Justice Award in 2004 from Community Legal Services.

David frequently lectures about trial tactics and intellectual property matters. A former concert pianist, David sits on the board of Astral Artistic Services, an organization dedicated to advancing the careers of young concert musicians. For four years, David was the solicitor for the Borough of Swarthmore, and now serves on the Swarthmore Borough Authority.

Joseph Petersen is a partner in the Intellectual Property group in the New York office of Kilpatrick Stockton LLP. Mr. Petersen has extensive experience in complex commercial litigation with particular expertise in intellectual property disputes such as copyright infringement, trademark infringement, trade secrets, litigation, patent infringement, and domain name disputes. He also regularly counsels clients on the protection, enforcement and licensing of their intellectual property assets.
Selected Experience
• Successfully represented the plaintiff in Yurman Design Inc. v. Diamonds and Time, 169 F. Supp. 2d 181 (S,D.NY. 2001) (granting plaintiff's motion for preliminary injunction in trademark infringement litigation).
• Represented leading manufacturer of ant-theft devices in successful motion for preliminary injunction in action pending before the United States District Court for the Southern District of Florida.
• Obtained temporary restraining order restraining defendant's enforcement of foreign injunction enjoining client from importing merchandise to defendant’s competitor during peak of holiday selling season.
• Represented client in successful motion to dismiss antitrust claims brought against a leading jewelry firm
• Represented leading cable television network in opposition proceedings before the Trademark Trial and Appeal Board.

Background
Admitted to practice before the U.S. Court of Appeals, Second Circuit; U.S. District Court for the Southern and Eastern Districts of New York; U.S. District Court, District or Connecticut; New York and Connecticut state courts.

Education
Law: Vanderbilt University, J.D. (1998)
Undergraduate: State University of New York, B.S., summa cum/aude (1991)
Bar Admission(s)

New York; Connecticut, U.S. Court of Appeals for the Second Circuit; Eastern District of New York; Southern District of New York

Raymond Dowd is a member of DBM's intellectual property, corporate, litigation and arbitration practice groups. He has broad commercial litigation experience in both federal and state courts, and has represented copyright, trademark and domain name owners, broadcasters, distributors and content providers in transactions and litigation, representing both plaintiffs and defendants. He has conducted numerous bench and jury trials and arbitrations. He has obtained, enforced, and collected judgments including conducting seizures. In addition, he has provided corporate and transactional representation entrepreneurial companies from the incorporation and startup phase through significant growth. Mr. Dowd represents collectors and dealers of fine art and has litigated disputes involving authenticity, forgery, ownership and provenance. Mr. Dowd regularly speaks to trade associations on copyright, fine art, trademark and litigation issues, and participates in organizing continuing legal education programs.

Memberships and Affiliations: Copyright Society of the U.S.A.; New York State Bar Association; Commercial and Federal Litigation Section; Intellectual Property law Section; President, Southern District of New York State Chapter of the Federal Bar Association (2006-2008); Federal Bar Association, Vice President for the Second Circuit (2008 - ); New York County Lawyers' Association; Board of Directors (2003 - 2006); Co-Chair, Entertainment Media, Intellectual Property and Sports Law Section (2000 - 2003); Continuing Legal Education (2003 - 2008); Committee on Committees ( 2003 - 2007).

Publications: Copyright Litigation Handbook, (West 3d Ed. 2008); former columnist, New York Law Journal; Copyright Litigation Blog. Member, Editorial Board, The Federal Lawyer (2007 - ).

Bar Admissions: New York (1993); U.S. District Court for the Southern and Eastern Districts of New York (1994); Northern U.S. Court of Appeals for the Second Circuit (1998);U.S. Supreme Court (2000); United States District Court for the Northern District of New York (2000); United States Tax Court (2007)

Education: Manhattan College (B.A. 1986); Fordham University School of Law (J.D. 1991)
Languages: French, Italian

Art Litigation: American Association of Museums Should Be Prosecuted For Concealing Stolen Property

MoMA's Glenn Lowry - Asserting Statutes of Limitations Against Heirs of Nazi Persecutees and Getting Richly Compensated For It

On Friday, I attended a panel on the U.S. State Department's proposal to set up a U.S. Commission to deal with the problem of Nazi-looted art in U.S. museum collections.   More on the panel, Wrestling the Dead Hand of History organized by Prof. Jennifer Kreder here.

Amb. Stuart Eizenstat - Expressing Outrage

The atmosphere was one of unanimous outrage over the misbehavior of U.S. museums and their lack of adherence to the Washington Principles on Nazi-Confiscated Art.  U.S. museums have taken to suing heirs of victims of Nazi persecution to avoid discovery and litigation "on the merits".   U.S. museums assert laches and statute of limitations defenses, knowing that it will damage international efforts to obtain recoveries of artworks from museum collections around the world.  If the U.S. is not going to support Jewish heirs, then who will?

The Jewish Claims Conference and Ronald Lauder's Commission for Art Recovery have asked U.S. museums to renounce the use of "technical" legal defenses such as laches and statutes of limitations as being unethical.   According to Lauder's lawyer Charles Goldstein, who signed the letter, the AAM and AAMD have not even bothered to respond to the request.   This is not the usual museum practice in dealing with a billionaire's lawyer.

In the postwar era, U.S. museums acquired tens of thousands of potentially-looted artworks. They've given virtually none of it back, have not properly researched their collections, and sit back hoping that the heirs of an exterminated population will never figure it out.   According to the museums, it is the job of the people who were murdered to finance and assert claims, after which, museums will decide whether or not to give the work back.

Museums claim that no one had any idea about the Holocaust when they acquired these artworks from the 1940's until today, often as donations, almost always without paperwork.   Since the severe Nazi persecution of Jews and the spoliation of their property was on the front page of every newspaper in the world starting in March 1933, the museums are engaging in a particularly pernicious form of Holocaust denial.

The custom and practice in the art world has always been to get documentation of the artwork's prior ownership and authenticity.  If you didn't get the paperwork, you were taking a risk that the property was stolen.   This practice has not changed, yet museums falsely claim that this is a recent development.  Wealthy Americans who bought European art at bargain prices without paperwork in the '40's, '50's and 60's knew darned well that they were probably buying stolen art.  Museum people always knew of the problem and were specifically and repeatedly warned in writing by the U.S. State Department in the 1940's and 1950's against acquiring artworks lacking paperwork.  Receiving stolen property has alway been a crime.


18 U.S.C. § 662 : US Code - Section 662: Receiving stolen property within special maritime and territorial jurisdiction

Whoever, within the special maritime and territorial jurisdiction of the United States, buys, receives, or conceals any money, goods, bank notes, or other thing which may be the subject of larceny, which has been feloniously taken, stolen, or embezzled, from any other person, knowing the same to have been so taken, stolen, or embezzled, shall be fined under this title or imprisoned not more than three years, or both; but if the amount or value of thing so taken, stolen or embezzled does not exceed $1,000, he shall be fined under this title or imprisoned not more than one year, or both.

(Italics supplied).

U.S. museums that refuse to disclose the documents necessary to trace the true owners of artworks in their collections should be prosecuted and their directors jailed.

Alfred Flechtheim - U.S. Museums Will Not Reveal Provenance Documents Relating To His 1933 Inventory

Image Jacob Hilsdorf 1910 courtesy Wikipedia

U.S. museums have it backwards and should be trying to figure out whose stolen property they are holding.  It was heartwarming to hear Goldstein affirm that museums do not have a fiduciary duty to litigate all claims and defenses relating to the stolen art in their collections.

When will the AAM and AAMD respond?   And without Robert Morgenthau on the scene, who will keep the museums honest?

$20 Million Copyright Infringement Jury Award Upheld

Kudos to David Wolfsohn at Woodcock Washburn in Philadelphia - on remand from the 3rd Circuit, the District Court upheld his $20 million copyright infringement judgment.  The case involved an employee who filched sales materials from an insurance company and used the materials secretly to poach clients for years.  Wolfsohn got damages for infringements reaching much farther back than the three years provided in 17 USC 507.   Plaintiffs whose unregistered copyrights were infringed are entitled only to actual damages and profits under 17 USD 504.

For the March 19, 20101 decision, click on the link below.

http://www.scribd.com/doc/28814393/Graham-v-Haughey-03-19-2010-20-Million-Copyright-Infringement-Jury-Award-Upheld

I reprint my post of August 2, 2009 below on the Graham v. Haughey case.

The Federal "Discovery" Rule: Can you sue for infringements occuring more than three years ago?
In Graham v. Haughey, --- F.3d ---, 2009 WL 1564223 (3d Cir. June 5, 2009), the Third Circuit considered the question of whether a victim of copyright infringement may sue for infringements that occurred over three years prior to the commencement of the lawsuit.
At issue is the federal "discovery" rule for accrual of an action versus the "injury" rule. I discuss this distinction in Chapter 5 of my Copyright Litigation Handbook (West 4th Ed. 2009). I was pleased to see that the Third Circuit discussed the cases that I had cited on this conflict (by the way, this fourth edition of Copyright Litigation Handbook just shipped last week).
The question is whether a cause of action for copyright infringement "accrues" when the infringement takes place (the "injury" rule) or whether it accrues when the victim, exercising reasonable diligence, discovers the infringement (the "discovery" rule). Most circuits have ruled that the federal discovery rule applies. But some district courts in the Second Circuit, relying on a powerfully-reasoned decision by Judge Kaplan in Auscape Intern. v. National Geographic Soc., 409 F. Supp.2d 235 (S.D.N.Y. 2004), have applied the "injury" rule.

To illustrate: under the injury rule, a court would either dismiss or grant summary judgment on a pleading that alleged infringements over three years prior to the action being filed.

Under the discovery rule, a court would permit equitable defenses such as tolling for fraudulent concealment and factfinding to determine whether a plaintiff could have, did, or should have discovered infringements over three years old prior to filing suit.

These rules relate to "accrual" of the action. The statute of limitations is always three years under 17 U.S.C. 507(b).
Graham v. Haughey determined that the "discovery" rule applies and that the plaintiff could sue on infringements that occurred over three years prior to the commencement of the action. Graham v. Haughey digs into the legislative history and consists of a point-by-point refutation of the Auscape decision. It also has an excellent discussion of issues relating to burdens of proof on damages, the nexus neccessary for damages to be attributable to copyright infringement, and the role of a judge in reviewing a jury verdict of copyright infringement.
Graham's facts are interesting because the infringement was committed by an ex-employee. The new employee used the infringing documents to generate millions in profits, but the publications were in proposals kept confidential by both the infringer and the recipient of the proposals for many years. After these secret transactions were finally revealed, the copyright owner sued and obtained a jury verdict in excess of $16 million.
This case involved an ex-employee breaching a contract not to retain or use copyrighted materials, so is an important cautionary tale for both new employers who don't want millions in liabilities and old employers who wish to protect their materials.
This is the odd case where a "publication" was not "public".
The Third Circuit remanded on apportionment issues.

Graham's counsel David J. Wolfsohn of Philadelphia's Woodcock Washburn (who was successful on the appeal and is pictured above) informs me that the matter is in abeyance pending Haughey's cert petition (due Sept 3). Haughey was represented by Floyd Abrams of Cahill Gordon & Reindell.

Ninth Circuit to Offer Remote Live Viewing of Cassirer v. Kingdom of Spain Case

Case update inspired by Clancco.

Cassirer v. Kingdom of Spain is an incredibly important Nazi art looting case proceeding before the Ninth Circuit Court of Appeals.  Museums around the world, including the U.S., have been propagating the myth that millions of Jews suddenly voluntarily decided to give away or sell all of their earthly possessions, including artworks for bargain basement prices, pay all of the money to the Nazi regime and flee Nazi persecution because they were simply exercising free will in a free marketplace. 

The museums, often run by the grandchildren of the people who avoided income taxation by donating the stolen works to the museums, now claim they didn't have any idea that this was going on (even this was all reported on the front pages of the NY Times).  Unfortunately, U.S. courts tend to buy the argument that museums ought to keep all of these pretty pictures.  Apparently, there is a sentiment that showing stolen artworks to children while concealing the provenance of the artworks has a salutory effect on America's youth.

The Cassirer case seeks to impose a constructive trust.

Paul Cassirer

http://www.ernst-barlach.de/vita/PaulCassirer.jpg

Bio on Wikipedia here

Camille Pissarro - Rue de St. Honore apres-midi, effet de pluie

Excerpt of Cassirer v. Kingdom of Spain and image from the IFAR website

http://www.ifar.org/case_summary.php?docid=1184185695

Claude Cassirer’s grandmother inherited the Pissarro, Rue de St. Honoré après-midi, effet de pluie, from her husband, whose father had purchased the work from a Parisian dealer. Mrs. Cassirer was forced to sell the work in 1939 in exchange for passage out of Germany. The work’s whereabouts remained unknown for many years thereafter. In 1976, Hahn sold the Pissarro to Baron Hans Heinrich Thyssen, who donated it to the Thyssen Collection, where it remains today. It is unclear how Hahn acquired the work. Claude Cassirer, Mrs. Cassirer’s only surviving relative, became aware of the work’s location in the Thyssen Collection “in the last several years.”

New development from Sergio Munoz Sarmiento at Clancco:

Ninth Circuit to Offer Remote Live Viewing of Cassirer v. Kingdom of Spain Case

Christie's Off The Hook For Selling Nazi Looted Art To Innocent Purchaser

In Doss, Inc. v. Yoon Young Im, a case decided by Chief Judge Loretta Preska of the Southern District of New York on September 23, 2009, Christie's successfully fended off a claim from a purchaser who'd bought what turned out to be Nazi looted art for $235,000 at a 1991 auction in New York.

The case arose when in 2008, Doss, Inc., the purchaser of a Marie Laurencin Portrait from Christie's tried to sell it through Sotheby's. Sotheby's researched the artwork and found that it had been looted by the Nazis from the well-known Paris art dealer Paul Rosenberg. Sotheby's informed Doss Inc. (the would-be seller) that the artwork was stolen.

Doss then sued Christie's for breach of warranty. The problem is that New York's U.C.C. Section 275 provides a four-year statute of limitations for breach of warranty (claim for breach of warranty must be commenced within four years of tender of delivery of the goods).

Once the four years runs, a seller of stolen goods is off the hook in New York, as far as New York's U.C.C. is concerned, unless some tolling principle, such as fraudulent concealment. New York is a buyer beware state. But it would certainly be surprising if Christie's didn't know what it was selling when it put the work up for auction in 1991.

Auction houses and museum have been peddling the fiction that Hitler's art looting was not "discovered" until the mid-1990's. But the Nurember trials covered these crimes on the front pages of the New York Times and such authors as Janet Flanner covered Nazi art looting activities in depth in an extraordinary three-part series in the New Yorker magazine in 1947. Museums and auction houses would prefer to forget about such works as David Roxan & Ken Wanstall's groundbreaking report based on the Art Looting Intelligence Unit's Reports - The Rape of Art: The Story of Hitler's Plunder of the Great Masterpieces of Europe (Cowan-Mc Gill New York 1964). Flanner's accounts of artworks being uncovered in salt mines together with gold teeth removed from Jewish corpses is a chilling reminder of how the Nazis intertwined looting and murder.

The truth is, museums, private owners and auction houses have been waiting for a couple of generations of Jews to die so that they can safely peddle and display the looted artworks held in their collections.

Christie's didn't know it was stolen in 1991 when they sold it? Horsefeathers!

9th Circuit Strikes Down California Holocaust Statute of Limitations As Violative of Federal War Powers!

In von Saher v. Norton Simon Museum of Art at Pasadena, 2009 WL 2516336 (9th Cir. August 19, 2009), the Ninth Circuit struck down Section 354.3 of California's Civil Code. Section 354.3 extended the statute of limitations until December 31, 2010 for the recovery of Holocaust-era art.

In a gross misreading of history, the court found that California's permitting Holocaust art claims to proceed against museums and galleries somehow impinged on the federal government's powers to deal with reparations.

The dissent, by Judge Pregerson, got it right. Judge Pregerson said that permitting lawsuits against museums and galleries present in California has nothing to do with permitting claims against a foreign power.

Fortunately, the court permitted von Saher's claims to proceed under Section 338 of California's Civil Code which applies a discovery rule to the statute of limitations.

But there is plenty of federal precedent on using the federal courts to unwind Nazi-era looting transactions. With over six million despoiled and murdered, a lot of art and other personal property flooded the world market, and particularly the U.S. art market during and after World War II. Americans with strong dollars profited from the tragedy by building great collections of European art. The federal government has always had a strong policy of using the courts to unwind Nazi-era transactions. The "Berstein" exception to the Act of State Doctrine is precisely such a strong federal policy in this area. In the Bernstein case, the U.S. State Department told the federal judiciary to suspend the act of state doctrine and not give the Nazi regime the deference ordinarily due a foreign sovereign.

Why are the federal courts recently so often hostile to permitting property stolen from Jews to be returned? There is no conceivable federal interest in stopping California from permitting persons to recover stolen private property.

Lucas Cranach the Elder's Adam and Eve.

New York County Lawyers' Art Litigation Institute Now on DVD

Art Litigation and Dispute Resolution Instititute Flyer

I recommend highly a Continuing Legal Education program that I helped to organize on art litigation and dispute resolution - you get 4 CLE credits for ethics and it is HIGHLY entertaining. Many attendees told me that it was the best CLE program they had ever attended.

To purchase the DVD, visit www.nycla.org

Credits: 8.5 MCLE Credits8.5 MCLE Credits: 4 Ethics; 1 Skills; 3.5 Professional Practice; Non-Transitional

Faculty: Matthew F. Bogdanos, Manhattan District Attorney’s Office; Judith A. Bresler, Withers Bergman; John J. Byrne, Byrne Goldenberg & Hamilton, Washington, D.C.; John R. Cahill, Lynn & Cahill; Hon. Miriam Goldman Cedarbaum, US Dist. Ct., SDNY; Sharon H. Cott, Metropolitan Museum of Art; Andrea Crane, Gagosian Gallery; Hon. Stephen G. Crane, JAMS; Raymond J. Dowd, Dunnington Bartholow & Miller; Hon. Laura E. Drager, New York State Supreme Court; Monica S. Dugot, Christie’s; David J. Eiseman, Golenbock, Eiseman, Assor & Bell; Robert J. Feinstein, Pachulski, Stang, Ziehl & Jones; Edward W. Hayes, Edward W. Hayes; Hon. Barbara Jaffe, Civil Court of NYC; Lawrence M. Kaye, Herrick Feinstein LLP; Thomas R. Kline, Andrews Kurth, Washington, D.C; John B. Koegel, Koegel Group LLP; Hon. John G. Koeltl, US Dist. Ct., SDNY; Jules B. Kroll, Jemkroll Holdings; Ralph E. Lerner, Withers Bergman; Dean R. Nicyper, Fleming, Zulack, Williamson, Zauderer; Anke Nordemann, Boehmert & Boehmert, Berlin, Germany; William G. Pearlstein, Golenbock, Eiseman, Assor & Bell; Lindsay Pollock, Art & Auction Magazine; Jan Prasens, Sotheby’s; Hon. Eve M. Preminger, Kramer, Levin, Naftalis & Frankel; Hon. Loretta A. Preska, US Dist. Ct., SDNY; Dr. Lucille Roussin, Cardozo Law; Jay G. Safer, Locke, Lord, Bissell & Liddell; Ronald D. Spencer, Carter, Ledyard & Milburn; Howard Spiegler, Herrick Feinstein; Peter R. Stern, McLaughlin & Stern; Hon. Joseph P. Sullivan (Ret.) Holland & Knight; Nancy E. Wolff, Cowan, DeBaets

Description: One of our finest course offerings from NYCLA-CLE, brings together an unparalleled panel of experts from the bench, bar, museums, art galleries, auction houses, trade publications, appraisers, and insurance companies to discuss the latest legal issues affecting the art community. Specific panels presented included:

Art Litigation and Dispute Resolution: Litigation, Arbitration or Mediation—Considerations for Practitioners Learn how to choose between and among litigation, arbitration and mediation when confronted with disputes concerning pieces of art. Some of the issues discussed by the panel of experts include the advantages and disadvantages of litigation, arbitration and mediation in the art context; how arbitration and mediation can be used more effectively in art disputes; and ways to make mediation more useful in art disputes.

Commencing an Action in Art Litigation: Replevin, Quiet Title, Slander of Title, Injunctive Relief and Statutes of Limitation In art law cases, the use of provisional remedies is neither rare nor usual. Typically provisional relief is sought to prevent a sale or other transfer of art – often because it has surfaced publically for the first time in years. A discussion of the forms of provisional remedies available is provided, as well as illustrative cases involving art law.

Art Lending, Bailments, Consignments, UCC, Liens and Security Interests While Article 2 of the U.C.C. governs an array of issues arising in art transactions, many states, including New York, doubting the sufficiency of the U.C.C. alone to safeguard art buyers, have enacted legislation that in some cases overrides the U.C.C. Learn about warranties, both from a review of U.C.C. principles and legislative and judicial expansions of the protections.

Contemporary Art, Copyright and Moral Rights The United States has reluctantly recognized the moral rights of artists to protect their reputations from harm through adverse treatment of their works of art or misuse of their identity as artists. Non-economic and personal to the artist, these rights exist independently of an artist’s copyright in or ownership of his or her own creation.

Dealing with Artists Estates and Foundations, Dealers, Auction Houses and Museums Experts discuss issues relating to how to deal with artists’ estates and foundations, art dealers, auction houses, museums and the press. Hear how the estate of Andy Warhol was handled, including litigation concerning attorney’s fees; learn about the issues surrounding how a private gallery works with attorneys to avoid and resolve disputes; discover how museums handle dispute resolutions; and find out how the press covers breaking legal stories in the art world.

Art Litigation and Dispute Resolution: Antiquities, Authentication, Provenance, Insurance, Damages, Appraisals and Valuation; Foreign Law and Choice of Law

Buying and selling ancient art requires the prudent purchaser to research the origin and history of ownership of an object and to evaluate the available information in the context of the legal framework discussed by this panel, for potential penalties for the unwitting purchaser of smuggled objects include civil forfeiture and for those who knew or in retrospect “consciously avoided” full knowledge, jail.

Program Co-Chairs: Hon Stephen G. Crane, JAMSRaymond J. Dowd, Dunnington Bartholow & Miller LLPAll Programs include: (1) Affirmation, (1) DVD/CD packet and (1) set of Written Materials TITLE AVAILABLE IN DVD FORMAT ONLY.

Nazi Looted Art in U.S. Museums: Amb. Stuart Eizenstat's Call for a US Commission

Ambassador Stuart E. Eizenstat was appointed by Secretary of State Hillary Clinton to lead a delegation to the Prague Conference on Holocaust-Era Assets. Eizenstat was the principle architect of the 1999 Washington Conference on the same topic. He authored the book Imperfect Justice and has been instrumental in achieving international solutions that afford restitution to Holocaust victims.

In the PBS video linked to below, Eizenstat calls for the U.S. to create a commission of experts to rule on ownership issues and decries U.S. museums that are asserting "technical defenses" such as statutes of limitations against Holocaust victims and their heirs.
Check out http://www.pbs.org/newshour/art/blog/2009/07/conversation-stuart-eizenstat.html

For the full text of what came out of the Prague Conference, known as the Terezin Declaration, click here.

The Federal "Discovery" Rule: Can you sue for infringements occuring more than three years ago?

In Graham v. Haughey, --- F.3d ---, 2009 WL 1564223 (3d Cir. June 5, 2009), the Third Circuit considered the question of whether a victim of copyright infringement may sue for infringements that occurred over three years prior to the commencement of the lawsuit.

At issue is the federal "discovery" rule for accrual of an action versus the "injury" rule. I discuss this distinction in Chapter 5 of my Copyright Litigation Handbook (West 4th Ed. 2009). I was pleased to see that the Third Circuit discussed the cases that I had cited on this conflict (by the way, this fourth edition of Copyright Litigation Handbook just shipped last week).

The question is whether a cause of action for copyright infringement "accrues" when the infringement takes place (the "injury" rule) or whether it accrues when the victim, exercising reasonable diligence, discovers the infringement (the "discovery" rule). Most circuits have ruled that the federal discovery rule applies. But some district courts in the Second Circuit, relying on a powerfully-reasoned decision by Judge Kaplan in Auscape Intern. v. National Geographic Soc., 409 F. Supp.2d 235 (S.D.N.Y. 2004), have applied the "injury" rule.

To illustrate: under the injury rule, a court would either dismiss or grant summary judgment on a pleading that alleged infringements over three years prior to the action being filed.

Under the discovery rule, a court would permit equitable defenses such as tolling for fraudulent concealment and factfinding to determine whether a plaintiff could have, did, or should have discovered infringements over three years old prior to filing suit.

These rules relate to "accrual" of the action. The statute of limitations is always three years under 17 U.S.C. 507(b).

Graham v. Haughey determined that the "discovery" rule applies and that the plaintiff could sue on infringements that occurred over three years prior to the commencement of the action. Graham v. Haughey digs into the legislative history and consists of a point-by-point refutation of the Auscape decision. It also has an excellent discussion of issues relating to burdens of proof on damages, the nexus neccessary for damages to be attributable to copyright infringement, and the role of a judge in reviewing a jury verdict of copyright infringement.

Graham's facts are interesting because the infringement was committed by an ex-employee. The new employee used the infringing documents to generate millions in profits, but the publications were in proposals kept confidential by both the infringer and the recipient of the proposals for many years. After these secret transactions were finally revealed, the copyright owner sued and obtained a jury verdict in excess of $16 million.

This case involved an ex-employee breaching a contract not to retain or use copyrighted materials, so is an important cautionary tale for both new employers who don't want millions in liabilities and old employers who wish to protect their materials.

This is the odd case where a "publication" was not "public".

The Third Circuit remanded on apportionment issues.

Graham's counsel David J. Wolfsohn of Philadelphia's Woodcock Washburn (who was successful on the appeal and is pictured above) informs me that the matter is in abeyance pending Haughey's cert petition (due Sept 3). Haughey was represented by Floyd Abrams of Cahill Gordon & Reindell.