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Enduring (Non-AI) Legal Issues

With so much attention being given to the legal issues that AI-powered technologies are generating, it can be easy to overlook or underestimate the importance of long-standing legal issues having nothing to do with artificial intelligence. While it would be neither possible nor particularly useful to catalog all of them in a single blog post, it might be helpful to highlight a few key legal issues that are developing alongside developments in AI law.

Copyright Law

The core principles of intellectual property remain anchored in traditional law. In that connection, it is important to understand the philosophy of copyright. Copyright is not the only kind of intellectual property there is, but it is by far the most common. Everyone who has ever written a story or a poem, scribbled a doodle, or composed an email message is very likely a copyright owner. Merit is not a requirement. In theory, even that terrible drawing of a turkey you made in first grade by tracing your fingers and hand on paper and drawing a head and two legs on it may be protected by copyright. Whether it makes sense to pay the filing fee to register something like that is a different story.

A key issue in copyright law that continues to evolve is fair use. Courts have been grappling with how to interpret and apply the four vaguely worded factors they must to make findings about whether a particular otherwise-infringing use is “fair” or not. The idea of “transformative use” is at the center of this evolving doctrine. Andy Warhol Foundation for the Visual Arts v. Goldsmith, decided in 2023, is a leading case in this area now. Other limitations on copyright infringement liability, such as the safe harbors set out in the Digital Millennium Copyright Act (DMCA), are also important. There are also evolving protections for sound recordings and licensing. Other topics in copyright law include such things as the copyright registration requirement, damages for copyright infringement, diversity, copyright estoppel, the limitations period for copyright infringement, the extent of protection for shorter works, compulsory e-book licensing, and circumvention of copyright protection measures.

The Internet Archive lawsuit addressed the phenomenon of digitized e-books and the impact on authors of making them freely available to readers via an online digital library.

The new administrative court for resolving smaller copyright claims, the Copyright Claims Board, is one of the more significant developments in copyright law in a long time. Find out what to know about the new CCB.

While artificial intelligence dominates headlines, legacy frameworks continue to undergo shifts, as seen in the tightening standards surrounding contributory copyright infringement and platform liability

Read about the top copyright cases of 2021.

Read about the top copyright cases of 2022.

Read about the top copyright cases of 2024.

Meanwhile, more and more works continue to enter the public domain.

Trademark Law

There has been a surge in interest in trademark law ever since the COVID-19 phenomenon. Many small brick-and-mortar businesses had to shut down as people were instructed to quarantine at home. While quarantining at home, a lot of people had the same idea: Starting a home-based, online business. Those new online businesses needed to have names. The USPTO was soon flooded with an unusually large number of trademark registration applications. Competition in the trademark space became fierce. Descriptiveness and likelihood-of-confusion challenges increased. New laws and procedures, such as the Trademark Modernization Act, were enacted to clear more room for new businesses by cancelling unused trademarks and cancelling registrations for classes of goods and services no longer being used by the trademark owners. Interest in nontraditional marks like color marks, trade dress, and sound and olfactory trademarks (smell marks) has also grown.

The clash between First Amendment values and trademark interests continues to surface from time to time. Courts have addressed trademark speech rights on several occasions now.

And of course, distinctiveness, likelihood of confusion, and registration disputes are ongoing.

Foundational Context: Major IP Developments of 2023

This section is a repost of an article I wrote in 2023 describing major developments in various areas of intellectual property law that took place that year. While I have broadened the scope of the discussion, it can still be useful to look back at what went on during that pivotal year, as it provides important context for the developments in IP law that are taking place now.

Copyright: Fair Use

Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith et al.

I’ve written about this case before as one of the top copyright cases of 2022 and as an aspect of photographers’ rights. The United States Supreme Court issued a ruling in the case in May. The decision is significant because it finally reined in the “transformative use” doctrine that the Court first announced in Campbell v. Acuff-Rose Music back in 1994. In that case, 2 Live Crew had copied key parts of the Roy Orbison song, “Oh, Pretty Women” to make a parody of the song in its own rap style. The Court held that the 2 Live Crew version, although reproducing portions of both the original song and the original recording of it without permission, transformed it into something else. Therefore, even though it infringed the copyright, the 2 Live Crew version was for a transformative purpose and therefore protected as fair use.

In the thirty years since Campbell, lower courts have been applying the “transformative use” principle announced in Campbell in diverse and divergent ways. Some interpretations severely eviscerated the copyright owner’s exclusive right to make derivative works. Their interpretations often conflicted. What one circuit called transformative “fair use” another circuit called actionable infringement. Hence the need for Supreme Court intervention.

In 1984, Vanity Fair licensed one of photographer Lynn Goldsmith’s photographs of Prince to illustrate a magazine article about him. Per the agreement, Andy Warhol made a silkscreen using the photograph for the magazine and Vanity Fair credited the original photograph to Goldsmith. Unknown to her, however, Warhol proceeded to make 15 additional works based on Goldsmith’s photograph withour her permission.. In 2016, the Andy Warhol Foundation for the Arts licensed one of them to Condé Nast as an illustration for one of their magazines. The Foundation received a cool $10,000 for it, with neither payment nor credit given to Goldsmith. The Foundation then filed a lawsuit seeking a declaration that its use of the photograph was a protected fair use under 17 U.S.C. § 107. The district court granted declaratory judgment in favor of the Foundation. The Second Circuit Court of Appeals reversed, ruling that the four-factor “fair use” analysis favored Goldsmith. The Supreme Court sided with the Court of Appeals.

Noting that it was not ruling on whether Warhol’s making of works using the photograph was fair use, the Court limited its analysis to the narrow question whether the Foundation’s licensing of the Warhol work to Condé Nast was fair use. On that point, the Court determined that the use of the photograph to illustrate a story about Prince was identical to the use Goldsmith had made of the photograph (i.e., to illustrate a magazine article about Prince.) Unlike 2 Live Crew’s use of “Oh, Pretty Woman,” the purpose of the use in this case was not to mock or parody the original work.

The case is significant for vindicating the Copyright Act’s promise to copyright owners of an exclusive right to make derivative works. While Warhol put his own artistic spin on the photograph – and that might have been sufficient to sustain a fair use defense if he had been the one being sued – the Warhol Foundation’s and Condé Nast’s purpose was no different from Goldsmith’s, i.e., as an illustration for an article about Prince. Differences in the purpose or character of a use, the Court held, “must be evaluated in the context of the specific use at issue.” Had the Warhol Foundation been sued for displaying Warhol’s modifications of the photograph for purposes of social commentary in its own gallery, the result might have been different.

Although the holding is a seemingly narrow one, the Court did take the opportunity to disapprove the lower court practice of ending a fair use inquiry at the moment an infringer asserted that an unauthorized copy or derivative work was created for a purpose different from the original author’s.

Copyright Statute of Limitations and Damages

Warner Chappell Music, Inc. v. Nealy

The U.S. Supreme Court has granted certiorari to review this Eleventh Circuit decision. At issue is whether a copyright plaintiff may recover damages for infringement that occurred outside of the limitations period, that is, infringement occurring more than three years before a lawsuit was filed.

The circuits are split on this question. According to the Second Circuit, damages are recoverable only for acts of infringement that occurred during the 3-year period preceding the filing of the complaint. The Ninth and Eleventh Circuits, on the other hand, have held that as long as the lawsuit is timely filed, damages may be awarded for infringement that occurred more than three years prior to the filing, at least when the discovery rule has been invoked to allow a later filing. In Nealy, the Eleventh Circuit held that damages may be recovered for infringement occurring more than three years before the claim is filed if the plaintiff did not discover the infringement until some time after it first began.

The United States Supreme Court has resolved the Circuit split. Read about the Supreme Court’s decision in Warner Chappell Music, Inc. v. Nealy

Artificial Intelligence

Copyrightability

Thaler v. Perlmutter, et. al.

This was an APA proceeding initiated in the federal district court of the District of Columbia for review of the United States Copyright Office’s refusal to register a copyright in an AI-generated work. In August, the district court upheld the Copyright Office’s decision that an AI-generated work is not protected by copyright, asserting that “human creativity is the sine qua non at the core of copyrightability….” For purposes of the Copyright Act, only human beings can be “authors.” Machines, non-human animals, spirits and natural forces do not get copyright protection for their creations.

Thaler appealed. Read more about what happened in Last Exit from Paradise.

Infringement

Many cases that were filed or are still pending in 2023 allege that using copyrighted works to train AI, or creating derivative works using AI, infringes the copyrights in the works so used. Most of these cases make additional claims as well, such as claims of unfair competition, trademark infringement, or violations of publicity and DMCA rights.

I have been blogging about these cases throughout the year. Significant rulings on the issues raised in them are expected to be made in 2024.

Trademark: Parody Goods

Jack Daniels’s Properties Inc. v. VIP Products LLC

For more information about this case, read my article, Balancing the First Amendment on Whiskey and Dog Toys.

This is the “parody goods” case. VIP Products used the “Bad Spaniels” name to market its dog toys, which were patterned on the distinctive shape of a Jack Daniel’s whiskey bottle. VIP filed a lawsuit seeking a declaratory judgment that its product did not infringe the Jack Daniel’s brand. Jack Daniel’s counterclaimed for trademark infringement and dilution. Regarding infringement, VIP claimed First Amendment protection. Regarding dilution, VIP claimed the use was a parody of a famous mark and therefore qualified for protection as trademark fair use. The district court granted summary judgment to VIP.

The Supreme Court reversed. The Court held that when an alleged infringer uses the trademark of another (or something confusingly similar to it) as a designation of source for the infringer’s own goods, it is a commercial, not an expressive, use. Accordingly, the First Amendment is not a consideration in such cases.

Rogers v. Grimaldi had held that when the title of a creative work (in that case, a film) makes reference to a trademark for an artistic or expressive purposes (in that case, Fred Astaire and Ginger Rogers), the First Amendment shields the creator from trademark liability. In the Jack Daniel’s case, the Court distinguished Rogers, holding that it does not insulate the use of trademarks as trademarks (i.e. as indicators of the source or origin of a product or service) from ordinary trademark scrutiny. Even through the dog toys may have had an expressive purpose, VIP admitted it used Bad Spaniels as a source identifier. Therefore, the First Amendment does not apply.

The Court held that the same rule applies to dilution claims. The First Amendment does not shield parody goods from a dilution claim when the alleged diluter uses a mark (or something confusingly similar to it) as a designation of source for its own products or services.

Trademark: International Law

Abitron Austria v. Hetronic International

Here, the Supreme Court held that the Lanham Act does not have extraterritorial reach. Specifically, the Court held that Sections 1114(1)(a) and 1125 (a)(1) extend only to those claims where the infringing use in commerce occurs in the United States. They do not extend to infringement occurring solely outside of the United States, even if consumer confusion occurs in the United States.

The decision is a reminder to trademark owners that if they want to protect their trademark rights in other countries, they should take steps to protect their rights in those countries, such as by registering their trademarks there.

Patents: Enablement

Amgen v. Sanofi

In this case, the Supreme Court considered the validity of certain patents on antibodies used to lower cholesterol under the Patent Act’s enablement requirement (35 U.S.C. 112(a)). At issue was whether Amgen could patent an entire genus of antibodies without disclosing sufficient information to enable a person skilled in the art to create the potentially millions of antibodies in it. The Court basically said no.

If a patent claims an entire class of processes, machines, manufactures, or compositions of matter, the patent’s specification must enable a person skilled in the art to make and use the entire class. In other words, the specification must enable the full scope of the invention as defined by its claims.
Amgen v. Sanofi, 598 U.S. ____ (2023)

Patents: Executive Power

In December, the Biden administration asserted that it can cite “excessive prices” to justify the exercise of Bayh-Dole march-in rights. The Biden Administration also has continued to support a World Trade Organization TRIPS patent waiver for COVID-19 medicines. These developments are obviously of some concern to pharmaceutical companies and members of the patent bar.

Conclusion

My vote for the most significant IP case of 2023 was Andy Warhol Foundation v. Goldsmith. Lower courts had all but allowed the transformative use defense to swallow up the exclusive right of a copyright owner to create derivative works. The Supreme Court provided much-needed correction. I predicted that in 2024, the most significant decisions would also be in the copyright realm, but that they would have to do with AI. The prediction turned out to be accurate.

Visit my extensive Copyright FAQs page.

The Copyright Discovery Rule Stands

The Copyright Act imposes a 3-year limitations period for copyright infringement claims. But when does a claim accrue? That is the (potentially) million-dollar question.

Last year, the United States Supreme Court held that as long as a claim is timely filed, damages may be recovered for any loss or injury, including losses incurred more than three years before the claim is filed (Warner Chappell Music. v. Nealy). The Court expressed no opinion about whether the Copyright Act’s three-year limitation period begins to run when the infringing act occurs or when the victim discovers it, leaving that question for another day. “Another day” arrived, but the Court still declined to address it. What, if anything, can be made of that?

front view of the Library of Congress building

Statute of Limitations for Copyright Infringement

The Copyright Act imposes a 3-year limitations period for copyright infringement claims. Specifically:

No civil action shall be maintained under the provisions of this title unless it is commenced within three years after the claim accrued.

17 U.S.C. 507(b).

But when does a claim accrue? That is the (potentially) million-dollar question.

According to the “incident of injury” rule, an infringement claim accrues when an infringing act occurs. Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U. S. 663, 670 (2014). Under this rule, an infringement victim who did not learn about an infringing act until three years after it occurred would be out luck.

Courts in many circuits, however, apply an alternative rule. Known as the “discovery rule,” it holds that a copyright infringement claim accrues when “the plaintiff discovers, or with due diligence should have discovered, the injury that forms the basis for the claim.” William A. Graham Co. v. Haughey, 568 F. 3d 425, 433 (CA3 2009) (internal quotation marks omitted). According to Patry on Copyright, this is the majority rule.

If a court applies the discovery rule, then the infringement complaint must be filed within three years after the victim learns or should reasonably have learned of the infringing act, even if that act occurred more than three years earlier.

The Look-Back Period for Damages

As I explained in Copyright Infringement Damages, the United States Supreme Court did not have the question about the validity of either accrual theory before it in Warner Chappell Music. Accordingly, it did not address the issue. Instead, the Court limited itself to deciding only the specific question before it, namely, whether damages can be claimed for all injuries that occurred before the victim learned (or reasonably should have learned) of an infringing act. The Court held that they can be. And this is true even for losses occurring more than three years before the infringement was discovered. Statutes of limitations only determine when a claim may be filed; they do not limit the look-back period for recovering damages for injury. “The Copyright Act contains no separate time-based limit on monetary recovery.” Warner Chappell Music, supra.

It must be kept in mind that the discovery rule has an important proviso. The clock starts clicking on a claim from the first date a victim actually knew or should have known of an infringement. In many cases, it may become more difficult to convince a judge that the victim’s unawareness of the infringing act was reasonable if a lot of time has gone by since the infringement occurred. Reasonableness, however, depends on all the facts and circumstances, so it has to be decided on a case-by-case basis.

RADesign, Inc. v. Ruthie Davis et al.

Michael Grecco Productions, Inc. sued RADesign, Inc. and others for copyright infringement. The complaint alleged that the defendant’s infringing use of a copyright-protected photograph began on August 16, 2017, and that the plaintiff discovered it on February 8, 2021. The complaint was filed in October, 2021. As a result, the claim would be barred under the “incident of injury” rule because it was filed more than three years after the alleged infringement occurred. The complaint, however, was filed in the Second Circuit, a jurisdiction that recognizes the discovery rule. Therefore, the question became whether the failure to discover the infringement within three years was reasonable. The district court held that it was not. The court described the copyright owner in this case as “sophisticated” in detecting and litigating infringements and therefore not entitled to the benefit of the discovery rule.

The Second Circuit Court of Appeals reversed, declaring, “This ‘sophisticated plaintiff’ rationale has no mooring to our cases.”

The U.S. Supreme Court’s Denial of Certiorari

RADesign, Inc. filed a petition for certiorari to the United States Supreme Court. The sole question presented was “Whether a claim ‘accrue[s]’ under the Copyright Act’s statute of limitations for civil actions, 17 U.S.C. 507(b), when the infringement occurs (the ‘injury rule’) or when a plaintiff discovers or reasonably should have discovered the infringement (the ‘discovery rule’).” The petition argued that the Copyright Act does not explicitly provide for a discovery rule and asserted that the courts of appeal should not have adopted one.

Unlike in Warner Chappell Music, the Court now had the validity of the discovery rule in copyright infringement cases squarely before it. The Court, however, declined the invitation to review that question. On June 16, 2025, it denied certiorari.

What a Denial of Certiorari Means

Really, the only legal effect of a denial of certiorari is that the lower court’s decision stands. In this case, that would mean that the Second Circuit Court of Appeals’ decision remains in effect for that specific case. For the time being, anyway, attorneys can cite the reasoning and holding of the Second Circuit Court of Appeals decision as legal precedent in other cases.

What a Denial of Certiorari Does Not Mean

A denial of certiorari does not mean that the Supreme Court agreed with the Court of Appeals. The Court of Appeal’s decision sets a precedent in the Second Circuit, but the denial of certiorari does not have that effect. It simply means the Supreme Court has decided not to trouble itself with the question at this time.

Visit my extensive Copyright FAQs page.

When Your Car Is a Character

This post isn’t about cars with character. It’s about cars as characters. Specifically, the question whether it is possible to claim copyright protection in a car that appears in a book, movie, song, or other work.

Carroll Shelby Licensing v. Halicki et al.

If you’re like me, you’ve probably owned a car with character, or even several cars with character, at some time in your life. A used Volkswagen Jetta with a replacement alternator that was held in place with washers. An old Plymouth Duster with a floor and doors that rusted clean through before the slant-6 ever had a problem. A Honda Fit that . . . well, this is probably a good place to stop dredging up memories. This post isn’t about cars with character. It’s about cars as characters. Specifically, the question whether it is possible to claim copyright protection in a car that appears in a book, movie, song, or other work.

The Ninth Circuit Court of Appeals had occasion to address this very question in Carroll Shelby Licensing et al. v. Halicki et al, No. 23-3731 (9th Cir., May 27, 2025).

Gone in 60 Seconds and Sequela

In the 1974 movie, Gone in 60 Seconds, the protagonist is tasked with stealing forty-eight types of cars. He and his colleagues assign them names. They call the Ford Mustang with black stripes “Eleanor.” Action ensues.

1967 Ford Mustang "Eleanor" - blue with racing stripes. Very shiny. — 1967 Ford Mustang

Three movies incorporating elements of this one were made and released thereafter — One was called The Junkman. Another one was called Deadline Auto Theft, and then there was a year 2000 remake of Gone in 60 Seconds. A car that was made to look like the Mustang in the original Gone in 60 Seconds appeared in these movies, as well. The message, “‘Eleanor’ from the movie Gone in 60 Seconds” was painted on its side.

Shelby contracted with Classic Recreations to produce “GT-500CR” Mustangs. Without going into all of the contractual and procedural details, the owner of the copyright in the first three movies eventually asserted a claim of copyright infringement, raising the question whether copyright can be claimed in “Eleanor,” the Ford Mustang car that appeared in the movies.

Character Copyrights

Fictional works generally are eligible for copyright protection. Sometimes copyright protection will extend to fictional characters within one as well. Mickey Mouse and Godzilla are examples.

_{NOTE: This blog post was not produced, sponsored or endorsed by Disney, and is not affiliated with Disney or any person, company or organization affiliated or associated with Disney.}

The test for independent character copyright protection is set out in DC Comics v. Towle. In sum, the character must:

have both physical and conceptual qualities;
be “sufficiently delineated” to be recognizable as the same character whenever it appears; and
be “especially distinctive” with “some unique elements of expression.”

The 9th Circuit Court of Appeals held that “Eleanor” failed to meet any of these criteria.

1. Physical and conceptual qualities

Eleanor had physical qualities, but the Court held that it lacked conceptual qualities. Conceptual qualities include “anthropomorphic qualities, acting with agency and volition, displaying sentience and emotion, expressing personality, speaking, thinking, or interacting with other characters or objects.” Shelby, supra. The character does not have to be human. It can be almost anything, so long as it has some of the above traits. Thus, the Batmobile could qualify.

The Court determined, however, that Eleanor the car lacked any of these conceptual qualities, likening her to property rather than a character.

2. Sufficient delineation

Here, the Court determined that Eleanor lacked consistent traits. In some iterations, Eleanor appeared as a yellow and black Fastback Mustang; in others, as a gray and black Shelby GT-500 Mustang, or a rusty, paintless Mustang. The Court concluded that Eleanor was too lightly sketched to satisfy the “sufficient delineation” test.

3. Unique elements of expression

Having no regard at all for Eleanor’s feelings, the Court declared, “Nothing distinguishes Eleanor from any number of sports cars appearing in car-centric action films.” According to the Court, she was just a run-of-the-mill automobile. Accordingly, she failed the distinctiveness test.

Quiz

Just for fun, try your hand at applying the Towle test to determine which of these might qualify for copyright protection and which ones don’t:

Chuck Berry’s Maybeline
My Mother the Car
Prince’s Little Red Corvette
Chitty Chitty Bang Bang
Christine
KITT in Knight Rider
The Magic School Bus
Thomas the Tank Engine
Gumdrop
Dick Turpin
Truckster in National Lampoon’s Vacation
The Bluesmobile in The Blues Brothers
The Hearse
Herbie in The Love Bug
The DeLorean in Back to the Future
The Gnome-Mobile
Ecto-1 in Gho s tbusters
Bessie in Doctor Who
General Lee in The Dukes of Hazzard
The Munster Coach in The Munsters
Shellraiser in Teenage Mutant Ninja Turtles
Benny the Cab in Who Framed Roger Rabbit?
Lightning McQueen in Cars
The Mystery Machine in Scooby-Doo
The Gadgetmobile in Inspector Gadget
Mustang Sally
Killdozer
Ivor the Engine
Tootle
Roary the Racing Car.

Give yourself 3,500 extra points if you are familiar with all of these references.

Points are not redeemable for value.

Concluding Thought

Even if a fictional character does not qualify for copyright protection, it might be protected as a trademark in some cases. The requirements for trademark protection are a subject for another day.

Read about other non-AI-related legal issues.

Category: Non-AI Copyright

Enduring (Non-AI) Legal Issues

Copyright Law

Trademark Law

Other Legal Topics