From the category archives:

CASENOTES

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Have to love a United States District Court complaint that starts as follows:

“The publicized origin story of Square, Inc. is a fabrication. The business now known as Square was not created solely by Jack Dorsey and James McKelvey. It was Professor Robert Morley— and Dr. Morley alone— who invented the Square card reader, and Dr. Morley coinvented the corresponding magnetic stripe decoding algorithms of the Square app. Dr. Morley had over a decade of experience in the credit card industry, spanning card reader technology,
industry contacts, and business operations. In contrast, Messrs. Dorsey and McKelvey had no noteworthy experience in the credit card industry. Dorsey, Morley, and McKelvey worked together in a joint venture with the goal of entering the mobile credit card transaction industry inventing the Square card reader, which enabled Square’s entry into the mobile credit card transaction industry, Dr. Morley contributed his technological expertise and knowledge of the credit card industry to the joint venture. But Messrs. Dorsey and McKelvey betrayed the joint venture by incorporating Square, Inc., dictating the ownership of the newly incorporated company, and cutting Dr. Morley completely out of the enterprise.And in an attempt to whitewash these transgressions, Square has embroiled Dr. Morley in years of litigation and proceedings before the United States Patent and Trademark Office— forcing him to defend himself against the company he helped create. This lawsuit seeks justice for Dr. Morley, redress and redemption.”

For you startup litigation geeks:

Count One – Breach of Joint Venture Agreement

Count Two – Breach of Fiduciary Duty

Count Three – Unjust Enrichment

Count Four – Patent Infringement

Count Five – Consturctive Trust

Count Six – Civil Conspiracy

Count Seven – Negligent Misrepresentation

Count Eight – Fraud

Count Nine – Fraudulent Nondisclosure

Count Ten – Correction of Inventorship

Count Eleven – Conversion

Count Twelve – Misappropriation of Trade Secrets

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A recent client inquiry caused me to read again this excerpt from a decision of the United States Court of Appeals for the First Circuit:

llbeandrake“Our reluctance to apply the anti-dilution statute (Maine trademark law) to the instant case also stems from a recognition of the vital importance of parody. Although, as we have noted, parody is often offensive, it is nevertheless “deserving of substantial freedom — both as entertainment and as a form of social and literary criticism.” Berlin v. E.C. Publications, Inc., 329 F.2d 541 (2d Cir.), cert. denied, 379 U.S. 822, 85 S.Ct. 46, 13 L.Ed.2d 33 (1964). Accord Fisher v. Dees, 794 F.2d 432, 437-38 (9th Cir.1986)(“`Destructive’ parodies play an important role in social and literary criticism and thus merit protection even though they may discourage or discredit an original author.”);Pring v. Penthouse International, Ltd., 695 F.2d 438 (10th Cir.1982), cert. denied, 462 U.S. 1132, 103 S.Ct. 3112, 77 L.Ed.2d 1367 (1983) (defendants’ bawdy “spoof” and “ridicule” of Miss America pageant entitled to full range of first amendment protection); Groucho Marx Productions v. Day and Night Co., 689 F.2d 317, 319 n. 2 (2d Cir.1982) (noting “the broad scope permitted parody in first First Amendment law.”); Elsmere Music v. National Broadcasting Co., 623 F.2d 252, 253 (2d Cir.1980)(“in today’s world of unrelieved solemnity, copyright law should be hospitable to the humor of parody….”). It would be anomalous to diminish the protection afforded parody solely because a parodist chooses a famous trade name, rather than a famous personality, author or creative work, as its object.[5]”

L.L. BEAN, INC. v. DRAKE PUBLISHERS, INC., 811 F.2d 26 (1987) (1st. Cir 1987)

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piggyback

A federal appeals court in Boston has denied the claim that the photo on the right infringed the photo on the left. Harney v. Sony Pictures Television, Inc., United States Court of Appeals, First Circuit, January 7, 2013.

Photo District News explains to its photographer audience (hopefully not too busy suing each other), the protectable and non-protectable elements of the photograph”

“The appeals court said that Harney could not claim exclusive rights to the piggyback pose, the subjects’ clothing, the items they carried, or the church in the background with the bright blue sky behind it. But he could claim exclusive rights to the way he framed those elements, the placement of the subjects in the center of the frame, and the bright colors and shadows that make his image distinctive.”

Very, very, subjective stuff, n’est pas?

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“In the plaintiffs’ version, a dog embarks on a mission to save Christmas from a witch threatening to drain the world of holiday cheer with her magic icicle. In Disney’s version Santa Paws combats an evil icicle that threatens Christmas.”

[Source, TheWrap: "Judge Dismisses 'Santa Paws' Copyright Lawsuit Against Disney" 9/20/2012]

The precedent established here is that you cannot copyright the idea of a dog combating an evil icycle. One wonders, of course, what the outcome would have been if Disney had been the plaintiff, had produced its movie, and the plaintiffs here had come along and published their short story.

While I agree with the Court’s decision (federal trial court, Missouri), I rue the inherent ambiguities and unfairness of the laws and their litigated enforcement in our courts.

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The Australian High Court has refused to overturn a ruling holding Optus TV liable for copyright infringment for recording and showing from its cloud free over the air broadcasts of the Australian Football League.

From Google/YouTube to Apple/Samsung to Sydney, Australia, the new battles of copyright and intellectual property war are being waged by massive entities seeking to control the distribution of entertainment and ideas.

Although there are no pure or neutral judicial decisions based on law alone, the logic of the upheld appellate court decision seemed, at best, strained:

“The full bench of the Federal Court ruled that the 2004 exemption in the Copyright Act, which was designed to allow people to record TV broadcasts to watch later at a time more convenient, did not apply to the TV Now product, because Optus stood to gain commercially from it. And although the recording system was automated, Optus nonetheless had a role in “making” the recording.”

Some commentators worry about the effect that this decision may have on cloud storage services. I see the issue differently. The case has interest because the initial broadcasts were free, financed presumably by advertising revenue, and it is the time shifting prohibition that Professor Matthew Rimmer of the Australian National University sets out in the ZDNet article referenced here that is in play.

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A library defendant deep in the heart of Georgia will be awarded massive legal fees in its successful fair use defense of its library copying practices in Cambridge University Press et al v. Patton et al.

We link to the Publishers Weekly August 10 article that is being read by publishers and libary clients alike this week as the balance of power begins to subtly shift in our post-modern digital culture.

Our previous article “Cambridge Nil Georgia State Nil? A Copyright Derby Analysis” can be found here.

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Software engineer, patent examiner, and IP Blogger Charles Bieneman does a nice job summing up this week’s comprehensive copyright infringement grant of summary judgment in the TetrisMino battle at Tetris Holding, LLC v. Xio Interactive, Inc., No. 09-6115 (D. N.J. May 30, 2012).
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[For background article, thanks to @artinfodotcom "Postal Disservice: Could a Sculptor's Fight for Royalties From a Postage Stamp Change Copyright Law?]

The United States Post Office paid sculptor Frank Gaylord $775,000 to create his stunning Korean War Veterans Memorial in Washington’s West Potomac Park. Another artist, photographer John Alli, took a photo of the Memorial covered in snow and licensed the photograph to the United States Postal Service for use on a postage stamp. He received $1,500.

The stamp made $30,000,000!

Windfall for the financially challenged Post Office. No, sorry.

Frank Gaylord sued the USPS for copyright infringement. A lower court limited Gaylord’s damage to the typical fee USPS pays, around $5,000. On appeal, the court reversed this limitation and held that Gaylord may be entitled to a 10 percent royalty ($3 Million?) based on his typical fee arrangements for licensed images of his work.
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