Law & Entrepreneurship News

Archives: Copyright & Trademark

Family Entertainment and Copyright Act Passes House

The Family Entertainment and Copyright Act, passed last year by the Senate, has passed the House and is now in President Bush's hands.

The Washington Post reports:

The bill would protect technology that lets people automatically skip or mute sections of commercial movies that contain foul language, violence or nudity. The bill would assure manufacturers of DVD players and other devices that use the technology that they would not be violating Hollywood copyrights. The bill also would make it a federal crime to use video cameras to record films in movie theaters, and it would set penalties of up to 10 years in prison for anyone caught distributing a movie or song before its commercial release.

SCOTUS Hears Arguments in Grokster

As scheduled, the Supreme Court heard oral arguments for the Grokster case yesterday.  So far, it looks as though at least some Justices are uncomfortable with tightening the copyright laws.  Justice Souter remarked, "I know perfectly well that I can buy a CD and put it on my iPod.  But I also know if I can get music without buying it, I'm going to do so."  The problem comes when you consider what Souter reffered to as "the guy in the garage."  "The question is: how do we know in advance that we can give the inventor -- that is, the developer -- the confidence to go ahead?" asked Souter.  "How do we avoid the foregone conclusion that the iPod developer is going to lose his shirt?"

Justice Ginsburg addressed an alternate concern that SCOTUSblog reports troubles a number of the Justices: how does one judge secondary infringement in the digital age?  Under the Betamax standard, secondary infrigement claims will fail against a product with substantial non-infringing uses.  So the question becomes: is the Betamax standard somehow inadequate for digital technology?

More as this develops...

Tractor Giant Wants Square-Dancers to Relinquish Trademark

Case New Holland ("CNH") has filed a petition with the USPTO to cancel a trademark owned by Iowa farmers who use CNH tractors for a touring square-dance show.

Since 1998, 11 farmers from Nemaha, Iowa have been touring their square-dancing tractors under the trademarked name Farmall Promenade.  Now CNH, which currently owns a trademark for tractors under the Farmall name, wants the farmers' trademark cancelled.

CNH maintains that it has no desire to shut down the square-dancing machines; it simply wants to protect the Farmall name on apparel.  But the farmers believe their trademark allows them to sell T-shirts and similar merchandise bearing the Farmall Promenade name.

Says one farmer, "We're fighting it because we don't think we've done anything wrong."

Hatch to Head IP Subcommittee

A new Senate subcommittee on intellectual property was created last week, with Senator Orrin G. Hatch (R-Utah) named as its head.  Hatch has been a vocal proponent of expanding copyright protections; some readers may recall that Hatch once suggested that those who download copyrighted materials from the Internet should have their computers automatically destroyed.  Although Hatch has not mentioned plans to pursue this response, he has said that the subcommittee will have an an "aggressive agenda."

USPTO Goes on Hiring Spree

The USPTO announces plans to hire close to 1,800 patent examiners over the next two years, a staff increase of nearly 50 percent. The hiring spree is in response to an expected year-end backlog of 580,000 applications.

Marvel Claims Dismissed as Sham

Comic book giant Marvel hit a major roadblock in its trademark infringement case against the developers of the video game City of Heroes.  Last week, a district court judge dismissed more than half of Marvel's claims.

The controversy centers around the core concept of the game: players create superheros— customizing everything from costume to special powers— and do battle in a massive online world.  The problem, according to Marvel, is that the game allows players to create characters to similar to its own trademarked heros.

Late last year, Marvel sued the game's creators, NCSoft and Cryptic Studios, seeking an injunction against the companies to stop using its characters.  Last week, more than half of their claims were dismissed.  A district court judge found, among other things, that several allegedly infringing characters being offered as evidence were actually created by Marvel.  The claims, which the judge called a sham, were dismissed without leave to amend.

The defendants now have 10 days to dispute remaining claims.

WIPO Reports Rise in Cybersquatting

The World Intellectual Property Organization (WIPO) reported 1,117 cases of cybersquatting in 2004, a 6.6% increase from the previous year.  In the late 1990s it became apparent to both squatters and trademark owners alike that the territorial nature of trademark law, and the global nature of the Internet would conflict when it came to domain names.  A "cybersquatter" is someone who uses the registered trademark of another entity and registers it as a domain name.  The domain registered under the name is usually left blank while the cybersquatter waits for the trademark owner's best offer.   An entrepreneurial cybersquatter would have registered an exact tradename, plus several confusingly similar others.   WIPO created the Uniform Domain-Name Dispute Resolution Policy (UDRP) in response to an international cry for alignment of national and international IP rights on the Internet.

Although most disputes originate with companies in the United State, in 2004 WIPO also handled claims of cybersquatting from more than 20 countries around the world.  There are four approved Domain-Name Dispute Resolution Providers, WIPO, The National Arbitration Forum, CPR Institute for Dispute Resolution, and the Asian Domain Name Dispute Resolution Center.  All organizations operate under UPRP Although disputes can be brought to court or arbitration either before or after the determination of the dispute by an approved organization, decisions of UDRP have equivalent effect of a binding international arbitration and as such are likely to be upheld in court. 

80% of WIPO domain name disputes are resolved in favor of the trademark holder. And, WIPO Deputy Director General Francis Gurry feels that, "UDRP has been highly successful in creating a deterrent effect as well as providing trademark holders with an effective international remedy against cybersquatting."

Big Apple World's Second Home?

Perhaps as part of its bid to host the 2012 Olympic Games, the Big Apple is hoping to give itself a new nickname. The City of New York recently applied for the trademark "The World's Second Home." If approved, the city would have exclusive use of the slogan on a staggering variety of products: sunglasses, mousepads, fanny packs, neckties, T-shirts, bedroom furniture and disposable paper baby bibs, to name just a few.

Task Force Arrests 12 Infringers

Don't get me wrong: I take issue with the RIAA as much as the next guy. After all, they did sue a dead woman. But take note of the activities of the National Anti-Piracy Task Force in Ghana. In a three-day exercise, 12 suspects were arrested for possession of a combined 7,632 pirated CDs. Granted, that is quite the cache of pirated music; one suspect alone had 3,726 copies. But one arrestee had only 24 discs! 24! I know, I know. Breaking the law is an issue of quality, not quantity, and even one illegal CD exposes one to criminal sanction. But 24? You have 24 illegal copies right now, don't you? I thought so.

SCOTUS Set to Hear Grokster

On March 29, the Supreme Court will hear arguments in a case that could become a landmark in copyright law: MGM Studios, Inc. v. Grokster, Ltd.

The Grokster saga began when nearly every significant name in the entertainment industry teamed up to bring suit against the makers of peer-to-peer (P2P) file-sharing software such as Morpheus, Grokster and KaZaA.  The plaintiffs alleged that these P2P networks are used primarily for exchanging copyrighted materials by people without rights to distribute those materials.

Grokster's liability could be established my two alternate theories.  Contributory copyright infringement occurs when a defendant, with knowledge of the infringing activity, materially contributes to the infringing conduct of another.  Vicarious liability on the other hand requires that the defendant has the right and ability to control the infringer's acts and receives a direct financial benefit from the infringement. 

Will either theory prove successfull?  Previous attempts have failed.  Relying primarily on the Supreme Court's landmark decision in Sony Corporation of America v. Universal City Studios, Inc. (a.k.a. "Betamax"), the Ninth Circuit found [PDF] that P2P file-sharing software is capable of noninfringing uses.  Thus, the distributors of Grokster and Morpheus software could not held liable for users' copyright violations. 

But will the Supreme Court follow the Betamax ruling? Soon, that question will be settled once and for all.

More on this as it develops...