Does AI Infringe Copyright?

A previous blog post addressed the question whether AI-generated creations are protected by copyright. This could be called the “output question” in the artificial intelligence area of copyright law. Another question is whether using copyright-protected works as input for AI generative processes infringes the copyrights in those works. This could be called the “input question.” Both kinds of questions are now before the courts. Minnesota attorney Tom James describes a framework for analyzing the input question.

The Input Question in AI Copyright Law

by Thomas James, Minnesota attorney

In a previous blog post, I discussed the question whether AI-generated creations are protected by copyright. This could be called the “output question” in the artificial intelligence area of copyright law. Another question is whether using copyright-protected works as input for AI generative processes infringes the copyrights in those works. This could be called the “input question.” Both kinds of questions are now before the courts. In this blog post, I describe a framework for analyzing the input question.

The Cases

The Getty Images lawsuit

Getty Images is a stock photograph company. It licenses the right to use the images in its collection to those who wish to use them on their websites or for other purposes. Stability AI is the creator of Stable Diffusion, which is described as a “text-to-image diffusion model capable of generating photo-realistic images given any text input.” In January, 2023, Getty Images initiated legal proceedings in the United Kingdom against Stability AI. Getty Images is claiming that Stability AI violated copyrights by using their images and metadata to train AI software without a license.

The independent artists lawsuit

Another lawsuit raising the question whether AI-generated output infringes copyright has been filed in the United States. In this case, a group of visual artists are seeking class action status for claims against Stability AI, Midjourney Inc. and DeviantArt Inc. The artists claim that the companies use their images to train computers “to produce seemingly new images through a mathematical software process.” They describe AI-generated artwork as “collages” made in violation of copyright owners’ exclusive right to create derivative works.

The GitHut Copilot lawsuit

In November, 2022, a class action lawsuit was filed in a U.S. federal court against GitHub, Microsoft, and OpenAI. The lawsuit claims the GitHut Copilot and OpenAI Codex coding assistant services use existing code to generate new code. By training their AI systems on open source programs, the plaintiffs claim, the defendants have allegedly infringed the rights of developers who have posted code under open-source licenses that require attribution.

How AI Works

AI, of course, stands for artificial intelligence. Almost all AI techniques involve machine learning. Machine learning, in turn, involves using a computer algorithm to make a machine improve its performance over time, without having to pre-program it with specific instructions. Data is input to enable the machine to do this. For example, to teach a machine to create a work in the style of Vincent van Gogh, many instances of van Gogh’s works would be input. The AI program contains numerous nodes that focus on different aspects of an image. Working together, these nodes will then piece together common elements of a van Gogh painting from the images the machine has been given to analyze. After going through many images of van Gogh paintings, the machine “learns” the features of a typical Van Gogh painting. The machine can then generate a new image containing these features.

In the same way, a machine can be programmed to analyze many instances of code and generate new code.

The input question comes down to this: Does creating or using a program that causes a machine to receive information about the characteristics of a creative work or group of works for the purpose of creating a new work that has the same or similar characteristics infringe the copyright in the creative work(s) that the machine uses in this way?

The Exclusive Rights of Copyright Owners

In the United States, the owner of a copyright in a work has the exclusive rights to:

  • reproduce (make copies of) it;
  • distribute copies of it;
  • publicly perform it;
  • publicly display it; and
  • make derivative works based on it.

(17 U.S.C. § 106). A copyright is infringed when a person exercises any of these exclusive rights without the copyright owner’s permission.

Copyright protection extends only to expression, however. Copyright does not protect ideas, facts, processes, methods, systems or principles.

Direct Infringement

Infringement can be either direct or indirect. Direct infringement occurs when somebody directly violates one of the exclusive rights of a copyright owner. Examples would be a musician who performs a copyright-protected song in public without permission, or a cartoonist who creates a comic based on the Batman and Robin characters and stories without permission.

The kind of tool an infringer uses is not of any great moment. A writer who uses word-processing software to write a story that is simply a copy of someone else’s copyright-protected story is no less guilty of infringement merely because the actual typewritten letters were generated using a computer program that directs a machine to reproduce and display typographical characters in the sequence a user selects.

Contributory and Vicarious Infringement

Infringement liability may also arise indirectly. If one person knowingly induces another person to infringe or contributes to the other person’s infringement in some other way, then each of them may be liable for copyright infringement. The person who actually committed the infringing act could be liable for direct infringement. The person who knowingly encouraged, solicited, induced or facilitated the other person’s infringing act(s) could be liable for contributory infringement.

Vicarious infringement occurs when the law holds one person responsible for the conduct of another because of the nature of the legal relationship between them. The employment relationship is the most common example. An employer generally is held responsible for an employee’s conduct,  provided the employee’s acts were performed within the course and scope of the employment. Copyright infringement is not an exception to that rule.

Programmer vs. User

Direct infringement liability

Under U.S. law, machines are treated as extensions of the people who set them in motion. A camera, for example, is an extension of the photographer. Any images a person causes a camera to generate by pushing a button on it is considered the creation of the person who pushed the button, not of the person(s) who manufactured the camera, much less of the camera itself. By the same token, a person who uses the controls on a machine to direct it to copy elements of other people’s works should be considered the creator of the new work so created. If using the program entails instructing the  machine to create an unauthorized derivative work of copyright-protected images, then it would be the user, not the machine or the software writer, who would be at risk of liability for direct copyright infringement.

Contributory infringement liability

Knowingly providing a device or mechanism to people who use it to infringe copyrights creates a risk of liability for contributory copyright infringement. Under Sony Corp. v. Universal City Studios, however, merely distributing a mechanism that people can use to infringe copyrights is not enough for contributory infringement liability to attach, if the mechanism has substantial uses for which copyright infringement liability does not attach. Arguably, AI has many such uses. For example, it might be used to generate new works from public domain works. Or it might be used to create parodies. (Creating a parody is fair use; it should not result in infringement liability.)

The situation is different if a company goes further and induces, solicits or encourages people to use its mechanism to infringe copyrights. Then it may be at risk of contributory liability. As the United States Supreme Court has said, “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.” Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S. 913, 919 (2005). (Remember Napster?)

Fair Use

If AI-generated output is found to either directly or indirectly infringe copyright(s), the infringer nevertheless might not be held liable, if the infringement amounts to fair use of the copyrighted work(s) that were used as the input for the AI-generated work(s).

Ever since some rap artists began using snippets of copyright-protected music and sound recordings without permission, courts have embarked on a treacherous expedition to articulate a meaningful dividing line between unauthorized derivative works, on one hand, and unauthorized transformative works, on the other. Although the Copyright Act gives copyright owners the exclusive right to create works based on their copyrighted works (called derivative works), courts have held that an unauthorized derivative work may be fair use if it is “transformative.: This has caused a great deal of uncertainty in the law, particularly since the U.S. Copyright Act expressly defines a derivative work as one that transforms another work. (See 17 U.S.C. § 101: “A ‘derivative work’ is a work based upon one or more preexisting works, . . . or any other form in which a work may be recast, transformed, or adapted.” (emphasis added).)

When interpreting and applying the transformative use branch of Fair Use doctrine, courts have issued conflicting and contradictory decisions. As I wrote in another blog post, the U.S. Supreme Court has recently agreed to hear and decide Andy Warhol Foundation for the Visual Arts v. Goldsmith. It is anticipated that the Court will use this case to attempt to clear up all the confusion around the doctrine. It is also possible the Court might take even more drastic action concerning the whole “transformative use” branch of Fair Use.

Some speculate that the questions the Justices asked during oral arguments in Warhol signal a desire to retreat from the expansion of fair use that the “transformativeness” idea spawned. On the other hand, some of the Court’s recent decisions, such as Google v. Oracle, suggest the Court is not particularly worried about large-scale copyright infringing activity, insofar as Fair Use doctrine is concerned.

Conclusion

To date, it does not appear that there is any direct legal precedent in the United States for classifying the use of mass quantities of works as training tools for AI as “fair use.” It seems, however, that there soon will be precedent on that issue, one way or the other. In the meantime, AI generating system users should proceed with caution.

Newly Public Domain Works 2023

Thousands of books, movies, songs and other creative works entered the public domain in the United States in 2023. Here is a partial list compiled by Cokato Minnesota attorney Thomas James.

Thousands of books, movies, songs and other creative works enter the public domain in the United States this year. Here is a partial list. (Click here for last year’s list).

Sherlock Holmes

Last year, it was Winnie the Pooh. This year, Sherlock Holmes officially enters the public domain. Pooh’s release from copyright protection sparked some creative uses of A. Milne’s fictional bear, from a comic strip in which Pooh Bear appears completely naked (i.e., without his red shirt on) to a slasher film called Winnie the Pooh: Blood and Honey, coming soon to a theater near you.

Sherlock Holmes and his sidekick, Dr. Watson, have actually been in the public domain for a long time, since Arthur Conan Doyle began publishing stories about them in the late nineteenth century. The copyrights in those works had already expired when Congress extended copyright terms in 1998. Legal controversies continued to arise, however, over which elements of those characters were still protected by copyright. New elements that were added in later stories potentially could still be protected by copyright even if the copyrights in previous stories in the series had expired. Now, however, the copyright in the last two Sherlock Holmes stories Doyle wrote have expired. Therefore, it appears that all elements of Doyle’s Sherlock Holmes stories are in the public domain now.

One can only imagine what creative uses people will make of the Holmes and Watson characters now that they are officially in the public domain, too.

Sherlock Holmes, public domain character in attorney Tom James article

The Tower Treasure (Hardy Boys)

The Tower Treasure is the first book in the Hardy Boys series of mystery books that Franklin W. Dixon wrote. As of this year, it is in the public domain.

Again, however, only the elements of the characters and the story in that particular book are in the public domain now. Elements that appeared only in later volumes in the series might still be protected by copyright.

Steppenwolf

Herman Hesse’s Der Steppenwolf, in the original German, is now in the public domain. This version is to be distinguished from English translations of the work, which might still be protected by copyright as derivative works. It is also to be distinguished from the classic rock band by the same name. It is always important to distinguish between trademark and other kinds of uses of a term.

The Bridge of San Luis Rey

Thornton Wilder’s Pulitzer Prize winning novel about an investigation into the lives and deaths of people involved in the collapse of a Peruvian rope bridge has now entered the public domain.

Mosquitoes

William Faulkner’s satiric novel enters the public domain this year. This work is to be distinguished from the insect by the same name. The insect, annoyingly, has been in the public domain for centuries.

The Gangs of New York

Herbert Asbury’s The Gangs of New York is now in the public domain.

Amerika

Franz Kafka’s Amerika (also known as Lost In America) — was published posthumously in 1927. It is now in the public domain.

The Jazz Singer

The Jazz Singer is a 1927 American film and one of the first to feature sound. Warner Brothers produced it using the Vitaphone sound-on-disc system and it featured six songs performed by Al Jolson. The short story on which it is based, “The Day of Atonement,” has already been in the public domain for some time. Now the film is, too.

The Battle of the Century

The Laurel and Hardy film, The Battle of the Century, is now in the public domain. Other Laurel and Hardy films, however, may still be protected by copyright.

Metropolis

Science fiction fans are most likely familiar with this 1927 German science fiction silent movie written by Thea von Harbou and Fritz Lang based on von Harbou’s 1925 novel. It was one of the first feature-length movies in that genre. The film is also famous for the phrase, “The Mediator Between the Head and the Hands Must Be the Heart.”

The Lodger

Alfred Hitchcock’s first thriller has entered the public domain.

“We All Scream for Ice Cream”

The song, “I Scream; You Scream; We All Scream for Ice Cream” is now in the public domain. Don’t worry if you uttered this phrase prior to January 1, 2023. Titles and short phrases are not protected by copyright. Now, it would be a different story if you’ve publicly performed the song, or published or recorded the song and/or the lyrics. Merely uttering those words, however, is not a crime.

“Puttin’ on the Ritz”

This song was originally written by Irving Berlin in 1927. Therefore it is now in the public domain. Taco released a performance of a cover version of this song in 1982. This version of the song made it all the way to number 53 in VH1’s 100 Greatest One-Hit Wonders of the 80’s special. Note that even if the original musical composition and lyrics are in the public domain now, recorded performances of the song by particular artists may still be protected. The copyrights in a musical composition and a recording of a performance of it are separate and distinct things. Don’t go copying Taco’s recorded performance of the song without permission. Please.

“My Blue Heaven”

This song, written by Walter Donaldson and George Whiting, is now in the public domain. It was used in the Ziegfeld Follies and was a big hit for crooner Gene Austin. It is not to be confused with the 1990 Steve Martin film with that name, which is still protected by copyright.

“The Best Things In Life Are Free”

This song was written by Buddy DeSylva, Lew Brown and Ray Henderson for the 1927 musical Good News. Many performers have covered it since then. The (ahem) good news is that it is now in the public domain.

Caveats

The works described in this blog post have entered the public domain under U.S. copyright law. The terms of copyrights in other countries are not the same. In the European Union, for example, Herman Hesse’s Der Steppenwolf is still protected by copyright as of January 1, 2023.

And again, remember that even if a work has entered the public domain, new elements first appearing in a derivative work based on it might still be protected by copyright.

The featured image in this article is “The Man with the Twisted Lip.” It appeared in The Strand Magazine in December, 1891. The original caption was “The pipe was still between his lips.” The drawing is in the public domain.

The Top Copyright Cases of 2022

Cokato Minnesota attorney Tom James (“The Cokato Copyright Attorney”) presents his annual list of the top copyright cases of the year.

My selections for the top copyright cases of the year.

“Dark Horse”

Marcus Gray had sued Katy Perry for copyright infringement, claiming that her “Dark Horse” song unlawfully copied portions of his song, “Joyful Noise.” The district court held that the disputed series of eight notes appearing in Gray’s song were not “particularly unique or rare,” and therefore were not protected against infringement. The Ninth Circuit Court of Appeals agreed, ruling that the series of eight notes was not sufficiently original and creative to receive copyright protection. Gray v. Hudson.

“Shape of You”

Across the pond, another music copyright infringement lawsuit was tossed. This one involved Ed Sheeran’s “Shape of You” and Sam Chokri’s “Oh Why.” In this case, the judge refused to infer from the similarities in the two songs that copyright infringement had occurred. The judge ruled that the portion of the song as to which copying had been claimed was “so short, simple, commonplace and obvious in the context of the rest of the song that it is not credible that Mr. Sheeran sought out inspiration from other songs to come up with it.” Sheeran v. Chokri.

Instagram images

Another case out of California, this one involves a lawsuit filed by photographers against Instagram, alleging secondary copyright infringement. The photographers claim that Instagram’s embedding tool facilitates copyright infringement by users of the website. The district court judge dismissed the lawsuit, saying he was bound by the so-called “server test” the Ninth Circuit Court of Appeals announced in Perfect 10 v. Amazon. The server test says, in effect, that a website does not unlawfully “display” a copyrighted image if the image is stored on the original site’s server and is merely embedded in a search result that appears on a user’s screen. The photographers have an appeal pending before the Ninth Circuit Court of Appeals, asking the Court to reconsider its decision in Perfect 10. Courts in other jurisdictions have rejected Perfect 10 v. Amazon. The Court now has the option to either overrule Perfect 10 and allow the photographers’ lawsuit to proceed, or to re-affirm it, thereby creating a circuit split that could eventually lead to U.S. Supreme Court review. Hunley v. Instagram.

Tattoos

Is reproducing a copyrighted image in a tattoo fair use? That is a question at issue in a case pending in New York. Photographer Jeffrey Sedlik took a photograph of musician Miles Davis. Later, a tattoo artist allegedly traced a printout of it to create a stencil to transfer to human skin as a tattoo. Sedlik filed a copyright infringement lawsuit in the United States District Court for the Southern District of New York. Both parties moved for summary judgment. The judge analyzed the claims using the four “fair use” factors. Although the ultimate ruling was that fact issues remained to be decided by a jury, the court issued some important rulings in the course of making that ruling. In particular, the court ruled that affixing an image to skin is not necessarily a protected “transformative use” of an image. According to the court, it is for a jury to decide whether the image at issue in a particular case has been changed significantly enough to be considered “transformative.” It will be interesting to see how this case ultimately plays out, especially if it is still pending when the United States Supreme Court announces its decision in the Warhol case (See below). Sedlik v. Von Drachenberg.

Digital libraries

The book publishers’ lawsuit against Internet Archive, about which I wrote in a previous blog post, is still at the summary judgment stage. Its potential future implications are far-reaching. It is a copyright infringement lawsuit that book publishers filed in the federal district court for the Southern District of New York. The gravamen of the complaint is that Internet Archive allegedly has scanned over a million books and has made them freely available to the public via an Internet website without securing a license or permission from the copyright rights-holders. The case will test the “controlled digital lending” theory of fair use that was propounded in a white paper published by David R. Hansen and Kyle K. Courtney. They argued that distributing digitized copies of books by libraries should be regarded as the functional equivalent of lending physical copies of books to library patrons. Parties and amici have filed briefs in support of motions for summary judgment. An order on the motions is expected soon. The case is Hachette Book Group et al. v. Internet Archive.

Copyright registration

In Fourth Estate Public Benefits Corp. v. Wall-Street.com LLC, 139 S. Ct. 881, 889 (2019), the United States Supreme Court interpreted 17 U.S.C. § 411(a) to mean that a copyright owner cannot file an infringement claim in federal court without first securing either a registration certificate or an official notice of denial of registration from the Copyright Office. In an Illinois Law Review article, I argued that this imposes an unduly onerous burden on copyright owners and that Congress should amend the Copyright Act to abolish the requirement. Unfortunately, Congress has not done that. As I said in a previous blog post, Congressional inaction to correct a harsh law with potentially unjust consequences often leads to exercises of the judicial power of statutory interpretation to ameliorate those consequences. Unicolors v. H&M Hennes & Mauritz.

Unicolors, owner of the copyrights in various fabric designs, sued H&M Hennes & Mauritz (H&M), alleging copyright infringement. The jury rendered a verdict in favor of Unicolor, but H&M moved for judgment as a matter of law. H&M argued that Unicolors had failed to satisfy the requirement of obtaining a registration certificate prior to commencing suit. Although Unicolors had obtained a registration, H&M argued that the registration was not a valid one. Specifically, H&M argued that Unicolors had improperly applied to register multiple works with a single application. According to 37 CFR § 202.3(b)(4) (2020), a single application cannot be used to register multiple works unless all of the works in the application were included in the same unit of publication. The 31 fabric designs, H&M contended, had not all been first published at the same time in a single unit; some had been made available separately exclusively to certain customers. Therefore, they could not properly be registered together as a unit of publication.

The district court denied the motion, holding that a registration may be valid even if contains inaccurate information, provided the registrant did not know the information was inaccurate. The Ninth Circuit Court of Appeals reversed. The Court held that characterizing the group of works as a “unit of publication” in the registration application was a mistake of law, not a mistake of fact. The Court applied the traditional rule of thumb that ignorance of the law is not an excuse, in essence ruling that although a mistake of fact in a registration application might not invalidate the registration for purposes of the pre-litigation registration requirement, a mistake of law in an application will.

The United States Supreme Court granted certiorari. It reversed the Ninth Circuit Court’s reversal, thereby allowing the infringement verdict to stand notwithstanding the improper registration of the works together as a unit of publication rather than individually.

It is hazardous to read too much into the ruling in this case. Copyright claimants certainly should not interpret it to mean that they no longer need to bother with registering a copyright before trying to enforce it in court, or that they do not need to concern themselves with doing it properly. The pre-litigation registration requirement still stands (in the United States), and the Court has not held that it condones willful blindness of legal requirements. Copyright claimants ignore them at their peril.

Andy Warhol, Prince Transformer

I wrote about the Warhol case in a previous blog post. Basically, it is a copyright infringement case alleging that Lynn Goldsmith took a photograph of Prince in her studio and that Andy Warhol later based a series of silkscreen prints and pencil illustrations on it without a license or permission. The Andy Warhol Foundation sought a declaratory judgment that Warhol’s use of the photograph was “fair use.” Goldsmith counterclaimed for copyright infringement. The district court ruled in favor of Warhol and dismissed the photographer’s infringement claim. The Court of Appeals reversed, holding that the district court misapplied the four “fair use” factors and that the derivative works Warhol created do not qualify as fair use. The U.S. Supreme Court granted certiorari and heard oral arguments in October, 2022. A decision is expected next year.

Because this case gives the United States Supreme Court an opportunity to bring some clarity to the extremely murky “transformative use” area of copyright law, it is not only one of this year’s most important copyright cases, but it very likely will wind up being one of the most important copyright cases of all time. Andy Warhol Foundation for the Visual Arts v. Goldsmith.

New TM Office Action Deadlines

The deadline for responding to US Trademark Office Actions has been shortened to three months, in many cases. Attorney Thomas B. James shares the details.

by Thomas B. James (“The Cokato Copyright Attorney”)

Effective December 3, 2022 the deadline for responding to a U.S. Trademark Office Action is shortened from 6 months to 3 months. Here is what that means in practice.

Historically, applicants for the registration of trademarks in the United States have had 6 months to respond to an Office Action. Beginning December 3, 2022 the time limit has been shortened to 3 months.

Applications subject to the new rule

The new, shorter deadline applies to most kinds of trademark applications, including:

  • Section 1(a) applications (application based on use in commerce)
  • Section 1(b) applications (application based on intent to use)
  • Section 44(e) applications (foreign application)
  • Section 44(d) applications (foreign application)

Applications not subject to the new rule

The new deadline does not apply to:

  • Section 66(a) applications (Madrid Protocol)
  • Office actions issued before December 3, 2022
  • Office actions issued after registration (But note that the new deadline will apply to post-registration Office Actions beginning October 7, 2023)
  • Office actions issued by a work unit other than the law offices, such as the Intent-to-Use Unit or the Examination and Support Workload and Production Unit
  • Office actions that do not require a response (such as an examiner’s amendment)
  • Office actions that do not specify a 3-month response period (e.g., a denial of a request for reconsideration, or a 30-day letter).

Extensions

For a $125 fee, you can request one three-month extension of the time to respond to an Office Action. You will need to file the request for an extension within three months from the “issue date” of the Office Action and before filing your response. If your extension request is granted, then you will have six months from the original “issue date” to file your response.

Use the Trademark Office’s Request for Extension of Time to File a Response form to request an extension. The Trademark Office has issued a warning that it will not process requests that do not use this form.

The form cannot be used to request an extension of time to respond to an Office Action that was issued for a Madrid Protocol section 66(a) application, an Office Action that was issued before December 3, 2022, or to an Office Action to which the new deadline does not apply.

Consequences

Failing to meet the new three-month deadline will have the same consequences as failing to meet the old six-month deadline did. Your application will be deemed abandoned if you do not respond to the Office Action or request an extension on or before the three-month deadline. Similarly, your application will be deemed abandoned if you you are granted an extension but fail to file a response on or before the six-month deadline.

The Trademark Office does not refund registration filing fees for abandoned applications.

As before, in some limited circumstances, you might be able to revive an abandoned application by filing a petition and paying a fee. Otherwise, you will need to start the application process all over again.

More information

Here are links to the relevant Federal Register Notice and Examination Guide

Contact attorney Thomas James

Need help with trademark registration? Contact Thomas B. James, Minnesota attorney.

Court agrees to hear parody goods case

The U.S. Supreme Court will hear Jack Daniel’s v. VIP Products, the “dog toy” trademark case. Cokato Copyright Attorney Thomas James explains.

In my last blog post (“MSCHF Testing the Limits of Free Speech“) I wrote about the Wavy Baby Shoes case in the Second Circuit Court of Appeals. Now, in a different case raising similar issues, the United States Supreme Court will have an opportunity to resolve a circuit split on the parody goods question. On Monday, the Court granted certiorari in Jack Daniel’s Properties v. VIP Products.

The “Bad Spaniels” Dog Toy

Jack Daniel’s Products claims trademark rights, including trade dress, in the distinctive shape and label of its whiskey product. VIP Products has made a dog toy called “Bad Spaniels.” It has a very similar shape and label. Jack Daniel’s sued VIP, asserting trademark infringement and dilution claims.

The district court ruled in favor of Jack Daniel’s, finding that the dog toy was likely to confuse consumers about the source of the product and tarnish the Jack Daniel’s brand. The Ninth Circuit Court of Appeals however, reversed. The dog toys, the Court ruled, are parody goods protected as expression by the First Amendment.

The Second, Seventh and Eighth Circuit Courts of Appeals have taken different approaches regarding the scope of First Amendment protection for parody goods. The Supreme Court granted certiorari to resolve the split in the circuits.

The Trademark Dilution Revision Act

The Trademark Dilution Revision Act expressly excludes parody from dilution liability. It applies, however, only when the challenged use is “other than as a designation of source for the person’s own goods or services.” 15 U.S.C. § 1125(c)(3)(A)(ii). Thus, the Act covers parody advertisements or other parodic references to a product in a magazine, movie or other traditional form of artistic or literary expression, but it does not reach situations where a parody mark is used as a designation of source.

Rogers v. Grimaldi

As discussed in a previous blog post, the Second Circuit Court of Appeals ruled, in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989), that the use of a trademark in the title of a film or other artistic work is not actionable unless “the title has no artistic relevance to the underlying work whatsoever, or, if it has some artistic relevance, unless the title explicitly misleads as to the source or the content of the work.” Id. at 999.

In the Jack Daniel’s case, the district court held that the rule articulated in Rogers is limited to the use of a trademark in the title of a film or other artistic work. The Ninth Circuit Court of Appeals did not agree that the rule is so limited.

The case squarely raises the question whether and to what extent the First Amendment insulates makers and sellers of parody goods from trademark liability.

Conclusion

A decision in this case will be coming in a few months. It is difficult to predict what it will be. Many legal scholars, I am sure, will frame the issue as whether the Court will choose to extend Grimaldi to parody goods, on one hand, or to limit the case to its facts, on the other. Another possibility, however, is that the Court might choose to disapprove Grimaldi altogether. As usual, we will just have to wait and see.

MSCHF Testing the Limits of Free Speech

Wavy Baby Shoes test the limits of the First Amendment and trademark rights. Cokato Minnesota attorney Tom James explains what Vans v. MSCHF is about.

The owner of a trademark has the exclusive right to use it in commerce. The scope of the right is geographically limited, but if it is registered with the USPTO, then the owner’s exclusive right extends throughout the entire United States. The United States Constitution, however, also protects rights of speech and press freedom. What happens when these rights collide?

The U.S. Court of Appeals for the Second Circuit is now considering a case squarely raising that question, Vans v. MSCHF Prod. Studios, No. 22-cv-2156 (WFK)(RML), 20223 WL 1446681 (E.D.N.Y. April 29, 2022), argued, No. 22-1006 (2nd Cir. Sept. 28, 2022).

MSCHF is a New York art collective that creates and sells irreverent art products such as “Jesus shoes” and “Satan shoes.” It also allegedly created and sold about 4,000 pairs of what it calls “Wavy Baby” shoes, described as a parody of Van’s “Old Skool” skate shoes and the “digital shoes” that Van’s sells in computer games. MSCHF designed the shoe by applying a “liquify” filter to an image of an Old Skool shoe. The shoes are distributed with a warning that the consumer assumes the risk that the wavy sole may cause injury or death.

Vans sued MSCHF for trademark infringement. (Trade dress, including product design, can function as a trademark.) MSCHF asserted a First Amendment defense, arguing that Wavy Baby Shoes are protected parodic or artistic expression. The district court rejected the defense. An appeal to the Second Circuit Court of Appeals followed.

Nominative Fair Use

It is a longstanding principle of trademark law that merely mentioning or referring to another person’s trademark is not trademark infringement. This kind of use of a trademark, called nominative use, helps protect values central to the First Amendment. If people were not allowed to even mention another person’s trademark, then criticism and commentary about a company or its products and services would be severely hamstrung. Likewise, a photographer’s or artist’s ability to sell cityscape paintings and pictures would be severely hampered if including even a single company name or logo in it could open the artist to liability for trademark infringement.

Nominative use is a relatively easy concept to apply. If a trademark is used in a way that is not likely to confuse a consumer about the source of a product or service, then the use is not infringing. In most cases, nominative uses of trademarks are not likely to mislead any reasonable consumer about the source of a product.

Parody

Parody is another area where the First Amendment may trump trademark rights. It is an explicit statutory defense to a trademark dilution claim. Courts have used the First Amendment to extend the defense to infringement claims, too, provided certain conditions are met.

To qualify for protection, a parody product must convey two contradictory messages: (1) That it is the original; and (2) that it is not the original. That is to say, it must be sufficiently similar to the original that consumers understand the reference, but at the same time, it must also be sufficiently distinguishable that consumers are not likely to think it comes from the same source as the original. To work as parody, the second message must communicate some articulable element of ridicule, mockery, or irreverent commentary. This is consistent with the traditional trademark infringement “likelihood of confusion” requirement. A seller of a trademarked product is not likely to also sell products that mock, ridicule or make fun of the product and/or its seller.

In this case, the district court found that the Wavy Baby shoes satisfied the first element of a parody: They conveyed enough similarity to the Old Skool trademark to enable consumers to understand the reference. The court, however, found that the second message had not been communicated clearly enough, that the shoes and their packaging had failed to clearly communicate a satirical message.

In reaching its decision, the court found it significant that the Wavy Baby shoe is a “competing product” that does not “incorporate[] clear puns and parodic references.”

The Appeal

The main point MSCHF is raising on appeal is that the district court should have applied the rule announced in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989). In that case, Ginger Rogers sued Grimaldi and MGM for producing and distributing a movie called Ginger and Fred. The movie was about a different pair of dancers who had been compared to Fred Astaire and Ginger Rogers. The Second Circuit Court of Appeals held that the use of the phrase was artistically expressive and therefore not actionable as trademark infringement. MSCF contends that Wavy Baby Shoes, too, are artistically expressive, and that Rogers, therefore, should apply.

Vans argues that Rogers is distinguishable because that case did not involve infringing trade dress used to sell goods that compete with the trademark owner’s goods. “Since Rogers was decided, the courts in the Second Circuit have uniformly limited its application to expressive works such as books, movies, and video games.” Vans Br. at 31, Dkt. 75 (July 22, 2022). Vans maintains that “[t]here is no basis under Rogers or later authority to expand this holding to a commercial product that incorporates a competitor’s trademarks and trade dress,” id. at 33.

Conclusion

Assuming the Court does not disturb the district court’s anti-parody findings, the Court will need to decide whether the Rogers v. Grimaldi test should be extended to products, on one hand, or limited to traditional expressive works (e.g., books and movies), on the other. In any event, it is hoped that the Court will take the opportunity to clarify the relationship between parody goods doctrine and the Rogers test.

Contact attorney Tom James

Need help with copyright registration or a copyright matter? Contact attorney Tom James.

The Philosophy of Copyright

The Internet has created an existential crisis for copyrights. Well, not really. It has impelled some people to consider, for the first time, the rationale for copyrights and the legal protection of them. That sounds a lot less dramatic and thrilling than “existential crisis,” though.

The two frameworks

There are two basic frameworks for thinking about copyright law: deontological and utilitarian. Deontological approaches focus on rights and duties. Utilitarian approaches focus on the usefulness of copyrights in promoting or accomplishing some social good.

In simpler terms, we can think of copyrights as deserving of protection because respecting individual property rights is a moral good. That is the deontological way of thinking about them. On the other hand, we can think about protecting copyright in terms of how protecting copyrights benefits society – the greatest happiness for the greatest number of people. That is the utilitarian approach.

Generally speaking, European countries have tended toward the deontological, while the United States has tended toward the utilitarian. Droites de suite, the rights of an artist to attribution and integrity (the rights to be credited as author and to the preservation of the integrity of a created work) originated in Europe. The United States Constitution, by contrast, declares that the purpose of giving authors and inventors exclusive rights is simply “[t]o promote the Progress of Science and useful Arts,” (U.S. Const. Art. I, sec. 8(8)), a clearly utilitarian expression of the rationale for protecting intellectual property.

These are just generalities, of course. The amendment of the U.S. Copyright Act to include protection for the integrity and attribution rights of visual artists is an example of how the European approach has been “coming to America.” At the same time, European policy-makers are increasingly influenced by utilitarian ways of thinking.

The difference between the two approaches comes into sharp relief in the area of Fair Use. Viewing copyright as a personal right and infringement as a moral wrong, the concept of “fair use” is difficult to justify. Instead, resort is usually had to utilitarianism, the idea that infringement of individual rights can be justified if it makes a lot of people happier (the “public benefit” consideration in fair use analysis.)

The nature of the right

German law developed on a view of copyright as a personality right. Personality rights are recognized to some extent in American law, too. In the United States, however, only a person’s name, voice and likeness are considered to be elements of a person’s “personality.” The products of one’s mind, the works the person creates, are not. Those things are considered property rights in the United States.

Among those who view copyrights as property rights, there is a divide between those who view them as natural rights and those who view them solely as creatures of positive law. John Locke is the most celebrated proponent of the natural rights theory. Proponents of the positive law approach (as I call it, for purposes of this blog post) do not view authors’, artists’ and inventors’ rights as inalienable natural rights, but as rights the law will protect if and only to the extent that a government sees fit to create a law protecting them.

Proponents of the view that copyrights are solely the creatures of positive law, of course, measure the value of copyright protection in terms of public benefit. If, for example, they think that an Internet free from the restrictions of prohibitions against copyright infringement will make a great number of people happy (“public benefit”), then they will likely advocate for laws and interpretations of laws favoring a broad and expansive “fair use” exception to copyright protection.

The slack of utilitarian tension

Differences of opinion can arise among those who adopt the utilitarian approach to copyright because a variety of conflicting arguments about what will best promote the greatest happiness for the greatest number of people exist.

On one hand, there is the incentive theory expressed in the Intellectual Property Clause of the U.S. Constitution. The idea expressed there is that giving creators rights in their creations will ultimately lead to scientific and artistic progress. Protecting copyrights might not be enough to incentivize creativity but failing to protect them can be a disincentive to creative effort.

Conflicting with this, there is the argument that allowing more people to access and use other people’s ideas and inventions facilitates progress. This is the thought behind Open Source and other approaches focusing on the benefits of social collaboration in the development of ideas and inventions.

Conclusion

Anyhoobie, that is the nutshell version of the philosophy of copyright. Feel free to explore the subject in greater depth on your own. Philosophy can be fun, right? Right?

Who Am I?

That, too, is a great philosophical question. In my case, it is easy to answer. Cokato, Minnesota attorney Thomas James.

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Photographers’ Rights: Warhol Case Tests the Limits of Transformative Use

The U.S. Supreme Court will soon hear Andy Warhol Foundation for the Visual Arts v. Goldsmith. Attorney Thomas James explains what is at stake for photographers

In a previous post, I identified the Second Circuit’s decision in Andy Warhol Foundation for the Visual Arts v. Goldsmith as one of the three top copyright cases of 2021. It has since been appealed to the United States Supreme Court. Oral argument is scheduled for October 12, 2022.

The dispute

The underlying facts in the case, in a nutshell, are these:

Lynn Goldsmith took a photograph of Prince in her studio in 1981. Later, Andy Warhol created a series of silkscreen prints and pencil illustrations based on it. The Andy Warhol Foundation sought a declaratory judgment that the artist’s use of the photograph was “fair use.” Goldsmith counterclaimed for copyright infringement. The district court ruled in favor of Warhol and dismissed the photographer’s infringement claim.

The Court of Appeals reversed, holding that the district court misapplied the four “fair use” factors and that the derivative works Warhol created do not qualify as fair use.

The United States Supreme Court granted the Warhol Foundation’s certiorari petition.

The issue

In this case, the U.S. Supreme Court is being called upon to provide guidance on the meaning and scope of “transformative use” as an element of fair use analysis. At what point does an unauthorized, altered copy of a copyrighted work stop being an infringing derivative work and become a “transformative” fair use?

The Conundrum

In the chapter on copyright in my book, E-Commerce Law, I predicted a case like this would be coming before the Supreme Court at some point. As I noted there, a tension exists between the Copyright Act’s grant of the exclusive right to authors (or their assignees and licensees) to make modified versions of their works (called “derivative works”), on one hand, and the idea that making modified versions of copyrighted works is transformative fair use, on the other. The notion that making changes to a work that “transform” it into a new work qualifies as fair use obviously threatens to swallow the rule that only the owner of the copyright in a work has the right to make new works based on the work.

Lower courts have not been consistent in their interpretations and approaches to the transformative use concept. The Warhol case presents a wonderful opportunity for the Supreme Court to provide some guidance.

Campell v. Acuff-Rose Music

The “transformative use” saga really begins with the 1994 case, Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994). Unable to secure a license to include “samples” (copies of portions) of the Roy Orbison song, “Oh Pretty Woman” in a new version they recorded, 2 Live Crew proceeded to record and distribute their version with the unauthorized sampling anyway, invoking “fair use.”

In a decision that took many attorneys and legal scholars by surprise, the Supreme Court held that 2 Live Crew did not need permission to copy and distribute the work even though the work they created involved substantial copying of the Orbison song. To reach this conclusion, the Court propounded the notion that copying portions of another work — even substantial portions of it — may be permissible if the resulting work is “transformative.” This, the Court held, could hold true sometimes even if the newly created work is not a parody of the original.

In the years that followed, courts have struggled to determine what is a “transformative” modification of a work and what is a non-transformative modification of it. Some courts have demonstrated a willingness to apply the doctrine in such a way as to nearly nullify the exclusivity of an author’s right to make modified versions of his or her works.

Courts have also demonstrated a lack of consistency with respect to how they incorporate and apply “transformativeness” within the four-factor test for fair use set out in 17 U.S.C. Section 107.

Why It Matters

This might seem like an arcane legal issue of little practical significance, but it really isn’t. People are already pushing the transformative use idea into new realms. For example, some tattoo artists have claimed in court filings that they do not need permission to make stencils from photographs because copying a photograph onto skin is a “transformative use.”

Of course, making and distributing exact copies of a photograph for sale in a stream of commerce that directly competes with the original photograph should not be susceptible to a transformative fair use claim. But how far can the claim be carried? If copying a photograph onto somebody’s skin is “transformative” use, would copying it onto somebody’s shirt also be “transformative”?

Clarity and guidance in this area are sorely needed. Hopefully the Supreme Court will take this opportunity to furnish it.

Contact Cokato copyright attorney Thomas James

Need help with registering a copyright or with a copyright problem? Contact attorney Thomas James.

The Internet Archive Lawsuit

Thomas James (“The Cokato Copyright Attorney”) explains how Hachette Book Group et al. v. Internet Archive, filed in the federal district court for the Southern District of New York on June 1, 2020, tests the limits of authors’ and publishers’ digital rights in their copyright-protected works.

The gravamen of the complaint is that Internet Archive (“IA”) allegedly scanned books and made them freely available to the public via an Internet website without the permission of copyright rights-holders. Book publishers filed this lawsuit alleging that IA’s activities infringe their exclusive rights of reproduction and distribution under the United States Copyright Act.

As of this writing, the case is at the summary judgment stage, with briefing currently scheduled to end in October, 2022. Whatever the outcome, an appeal seems very likely. Here is an overview to bring you up to speed on what the case is about.

The undisputed facts

Per the parties’ stipulation, the following facts are not disputed:

The case involves numerous published books which the publishers who filed this lawsuit (Hachette Book Group, HarperCollins, Penguin Random House, and John Wiley &  Sons) have exclusive rights, under the United States Copyright Act, to reproduce and distribute.

Internet Archive and Open Library of Richmond are nonprofit organizations the IRS has classified as 501(c)(3) public charities. These organizations purchased print copies of certain books identified in the lawsuit.

The core allegations

The plaintiffs allege that IA obtains print books that are protected by copyright, scans them into a digital format, uploads them to its servers, and then distributes these digital copies to members of the public via a website – all without a license and without any payment to authors and publishers. Plaintiffs allege that IA has already scanned 1.3 million books and plans to scan millions more. The complaint describes this as “willful digital piracy on an industrial scale.”

Defenses?

First sale doctrine

One justification that is sometimes advanced for making digital copies of a work available for free online without paying the author or publisher is the so-called “first sale” doctrine. This is an exception to copyright infringement liability that essentially allows the owner of a lawfully acquired copy of a work to sell, transfer or lend it to other people without incurring copyright infringement liability. For example, a person who buys a print edition of a book may lend it to a friend or sell it at a garage sale without having to get the copyright owner’s permission. More to the point, a library may purchase a copy of a print version of a book and proceed to lend it to library patrons without fear of incurring infringement liability for doing so.

The doctrine does not apply to all kinds of works, but it does generally apply  to print books.

The first sale doctrine only provides an exception to infringement liability for the unauthorized distribution of a work, however. It does not provide an exception to liability for unauthorized reproduction of a work. (See 17 U.S.C. § 109.) Scanning books to make digital copies is an act of reproduction, not distribution. Accordingly, the first sale doctrine does not appear to be a good fit as a defense in this case.

“Controlled digital lending”

Public libraries lend physical copies of the books in their collections to library patrons for no charge.  Based on this practice, a white paper published by David R. Hansen and Kyle K. Courtney makes the case for treating the distribution of digitized copies of books by libraries as fair use, where the library maintains a one-to-one ratio between the number of physical copies of a book it has and the number of digital “check-outs” of the digital version it allows at any given time.

The theory, known as controlled digital lending (“CDL”), relies on an assumption that the distribution of a work electronically is the functional equivalent of distributing a physical copy of it, so long as the same limitations on the ability to “check out” the work from the library are imposed.

Publishers dispute this assumption. They take the position that there are important differences between e-books and print books. They maintain that these differences justify the distribution of e-books under a licensing program separate and distinct from their print book purchasing programs. They also question whether e-books are, in fact, distributed subject to the same limitations that apply to a print version of the book.

Fair use

Whether a particular kind of use of a copyright-protected work is “fair use” or not requires consideration of four factors: (1) the nature of the work; (2) the character and purpose of the use; (3) the amount and substantiality of the portion copied; and (4) the effect of the use on the market for the work.

Supporters of free access to copyrighted works for all tend to focus on the “character and purpose” factor. They can be relied upon to argue that free access to literary works is a great benefit to the public. Authors and publishers tend to focus on the other factors. In this case, it seems possible that the factors relating to the amount copied and the effect of the use on the market for the work could weigh against a finding of fair use.  

The federal district court in this case is being called upon to evaluate those factors and decide whether they weigh in favor of treating CDL – or at least, CDL as IA has applied and implemented it – as fair use or not.

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The Cokato Copyright Attorney (Minnesota lawyer Thomas B. James) will be following this case closely. Subscribe for updates as the case makes its way through the courts.

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Need help registering a copyright or trademark, or with a copyright or trademark problem? Contact Cokato, Minnesota attorney Tom James.

“The” A Registered Trademark Now

It happened. “The” is a registered trademark now. The USPTO issued a registration certificate for the word “The” to Ohio State University (Sorry; the Ohio State University) on June 21, 2022. How did this happen, and what does it mean?

The The Saga

The legal quest to own “the” began on May 6, 2019, when Marc Jacobs Trademarks, LLC (MJT) filed an application with the United States Patent and Trademark Office (USPTO) to register the word as a trademark for use on clothing, bags and similar merchandise. MJT claimed a first use date of December 3, 2018.

On August 8, 2019, the Ohio State University filed its own application to register the word as a trademark for use on clothing. The university claimed first use in commerce at least as early as August, 2005.

Due to the earlier filed MJT application, the examining attorney issued an office action to the Ohio State University. It referenced the earlier filed MJT application as a potential bar to registration of the Ohio State University claim. The application was suspended pending the outcome of MJT’s “the” application.

MJT’s application was published for opposition on October 27, 2020. The Ohio State University filed an opposition. The Ohio State University alleged that;

[MJT’s THE mark] “so resembles Ohio State’s THE mark as to be likely, when used on or in connection with the applied-for goods, to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection or association of MJT with Ohio State, or as to the origin, sponsorship or approval of the applied-for goods or commercial activities by Ohio State, all in violation of § 2(d) of the Trademark Act….”

Opposition of The Ohio State University in re: TM Application No. 88416806

It appears that the parties have reached a cooperative use agreement of some kind. The opposition has been withdrawn and the opposition proceeding has been terminated.

Ornamentation vs. The Registered Trademark

Both companies have faced objections from examining attorneys that their uses of the word “the” on clothing were ornamental. A decorative use of a word, symbol, design, etc. that does not function as an identifier of the source of a particular product or service is not sufficient to satisfy the “use in commerce” requirement for trademark registration.

After the USPTO rejected the MJT application in March, 2020, MJT filed a successful request for reconsideration. That led to the publication for opposition to which the Ohio State University responded. The USPTO issued a Notice of Allowance on October, 2021. The MJT application is still pending in the USPTO.

The Ohio State University initially encountered the same kind of resistance from the USPTO. The university remedied the problem, however, by showing that it wasn’t just using the word ornamentally; it was also putting it where trademarks usually go, such as inside the shirt at the back of the neck and on its website.

That satisfied the examiner. The mark was published for opposition, and on June 21, 2022 a registration certificate issued.

Scope of The Registered Trademark

Does this mean nobody can use the word “the” in a trademark anymore? No.

To begin with, the Ohio State University has only registered it in Class 25. Class 25 consists of sports and collegiate athletics clothing.

The registered trademark certificate
The trademark registration certificate

The ultimate question, in all cases, is whether another company’s use of the word would be likely to confuse consumers as to the origin of a product or service. The Tax Curative Institute should have very little to fear from the Ohio State University’s registration of “the” as a trademark for collegiate and athletic clothing.

What about displaying the word on clothing, though? Does the Ohio State University’s ownership of the “the” trademark for clothing mean that no one can display the word “the” on a T-shirt now?

Not necessarily. Purely ornamental uses of the word should not expose a T-shirt seller to a risk of infringement liability. For example, a company selling T-shirts emblazoned with the band name “The Slants” should not have to worry about being sued by the Ohio State University.

Of course, unless they have a license from The Slants, they might encounter some pushback for using the band’s name. That’s because the band owns a trademark in their name (“Slants”). Merely using the word “the,” however, should not be a problem. Consumers are not likely to think that every shirt they come across originates from The Slants merely because it has the word “the” on it.

Get in touch with The Cokato Copyright Attorney.

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