Category: Non-AI Copyright

Copyrights: Copyright law news and commentary from Cokato, Minnesota attorney Thomas James (Thomas B James) of the Law Office of Tom James | This category includes general legal issues such as the requirements for a valid copyright, ownership rights, registration, infringement, enforcement procedures, and damages.

Cox Communications v. Sony Music

The Scope of Contributory Liability for Copyright Infringement

Cox Communications, Inc. v. Sony Music Entertainment, 607 U.S. __ (2026)

I didn’t list contributory liability for infringement as one of the enduring non-AI issues in copyright law, but this year’s decision in Cox Communications v. Sony Music Entertainment is a reminder that issues thought to have been resolved years ago can resurface at any time.

Factual Background

Cox Communications, Inc. is an internet service provider selling internet, telephone, and cable television connections to millions of people. Some of its customers used this service to set up peer-to-peer networks such as BitTorrent to distribute copyrighted music without the permission of copyright owners. Sony Music Entertainment and other record companies owned the copyrights in some of these songs. Through the Recording Industry Association of America (RIAA), it hired a company to monitor illegal file sharing and notify internet service providers when it detected infringement. The company sent Cox Communications 163,148 notices of infringement during a two-year period. Cox Communications warned or suspended customers who were repeat infringers, but rarely terminated service for copyright infringement.

Sony and others sued Cox Communications for contributory and vicarious copyright infringement. They claimed that Cox Communications failed to take adequate measures to stop infringement, thereby inducing or materially contributing to its customers’ infringement of music copyrights.

The U.S. District Court for the Eastern District of Virginia denied Cox Communications safe harbor under the Digital Millennium Copyright Act (DMCA) and allowed the case to proceed to trial on theories of vicarious and contributory copyright infringement. The jury found Cox Communications liable on both counts and awarded $1 billion in statutory damages.

The Court of Appeals reversed the vicarious liability verdict, but affirmed the finding of willful contributory infringement. It vacated the damages award and remanded the case for a new trial on damages.

The case ultimately made its way to the United States Supreme Court. The Supreme Court unanimously reversed. Justice Thomas wrote the majority opinion. Justice Sotomayor wrote a concurring opinion.

front view of the Library of Congress building

Legal Background

Direct and Indirect Infringement

A copyright owner has the exclusive right to copy, distribute, display, perform, and make derivative works based on the copyrighted work. The exclusive right to perform a work includes the exclusive right to digitally transmit it. Anyone who exercises one of these exclusive rights without the owner’s consent is an infringer. Statutory damages of up to $150,000 per work may be awarded if infringement is willful. 17 U.S.C. § 504 (c)(2).

A person who actually performs the acts of unlawful reproduction, distribution, performance, etc. is guilty of direct infringement. A person who did not actually perform the infringing act but is responsible in some way for furthering it may be guilty of indirect infringement.   

Using an internet service to which you subscribe to reproduce, distribute and transmit copies of musical works without the copyright owners’ permission is an example of direct infringement. Providing a service or facility that customers use to do that is a potential source of contributory liability for infringement, but only under certain conditions.

In this case, Sony sought to hold Cox Communications liable for indirect infringement.

Vicarious and Contributory Liability

Courts recognize two kinds of indirect infringement: vicarious and contributory.

Vicarious liability

Vicarious liability may be imposed when one person has the right and ability to control, supervise and stop another person’s activity. Because employers have this power over their employees, they are often held vicariously liable for their employees’ acts within the course and scope of the employment.

Vicarious liability for infringement requires a showing of direct financial benefit from the infringing activity to the person with supervisory control. The lower courts rejected Sony’s claim of vicarious infringement liability because the financial benefit Cox received from its customers took the form of monthly internet subscription fees. It was not directly tied to infringing activity. Subscribers paid for lawful internet access, not for the ability to infringe copyrights. Cox Communications did not profit specifically or directly from the piracy occurring in the networks its customers set up.

The only issue to reach the United States Supreme Court in this case, therefore, was whether Cox Communications could be held contributorily liable for the infringing acts of its customers.

Contributory liability

Contributory liability may be imposed when a person either induces or materially contributes to another person’s wrongful act.

Material Contribution

The common law basis for contributory liability was “material contribution.” A person could be found to have materially contributed to an activity if s/he provided the site and facilities for infringement. No proof of inducement was necessary. Napster, for example, was found to have materially contributed to users’ acts of infringement because it maintained a centralized service with a searchable index of music files for users to download.

Sony Corp. v. Universal City Studios raised the question whether a company that provides products that enable copyright infringement is always contributorily liable for “materially contributing” to users’ acts of direct infringement.

The case involved video recording products, i.e., equipment that people can use to record television programs. The Supreme Court held that recording free, over-the-air broadcasts to watch at a more convenient time is fair use, so long as the recording is made for the viewer’s own personal, noncommercial use. The Court then held that a company is not contributorily liable for infringement merely because it provides a service or product that customers can use to infringe copyrights, provided the product or service has substantial non-infringing uses. Because recording a television program for later viewing is a substantial, non-infringing use, and there was no evidence that Sony said or did anything to encourage customers to make infringing uses of its products, the Court held the company could not be held contributorily liable for infringing acts on the part of the buyers of its products. The short answer, then, is no. Merely providing a product or service that can be used to infringe copyrights will not necessarily result in contributory liability for infringement, provided it has substantial, non-infringing uses.

Inducement

The Court limited the scope of this holding (sometimes called the “Betamax safe harbor”) in Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd. In this case, the Court held that a company does not get the benefit of the Betamax safe harbor for a product or service that has substantial, non-infringing uses if it actively induces infringing uses.

In Grokster, the Court relied on marketing, communications and operational evidence that Grokster had deployed promotional materials and meta-tags designed to capture internet searches for “Napster.” Napster was a file-sharing network that had been shut down after a court ordered it to block users from sharing copyrighted materials. (Napster has since been rebranded as a provider of generative and agentic AI services.) It also distributed newsletters to users touting the availability of copyrighted music and movies to download on its networks. Customer support instructed users on how to locate, download and play copyrighted files.

Even if a product or service has substantial, non-infringing uses, then, contributory liability may arise  if a company actively induces infringing uses by soliciting and encouraging infringers to use it and helping customers use it to infringe copyrights.

The Issue in Cox Communications v. Sony

Two rules can be distilled from pre-2026 contributory infringement cases:

1) Furnishing a product or service may result in “material contribution” liability if its primary use is to infringe copyrights.

2) Furnishing a product or service that has substantial, non-infringing uses will not result in contributory liability unless the provider actively induces infringing uses.

The question raised in Cox Communications v. Sony Music was whether failing to stop known infringing uses is also a basis for imposing contributory liability, when the product or service has substantial, non-infringing uses.

The holding in Cox Communications v. Sony Music

The Supreme Court unanimously held that an internet service provider’s failure to stop known infringing uses of its service is not a basis for imposing contributory liability for the infringing uses that customers make of its service. An ISP’s failure to stop known infringement neither induces users’ infringement nor provides an independent, third basis for contributory liability.

The Digital Millennium Copyright Act

The Digital Millennium Copyright Act (DMCA) immunizes ISPs from contributory liability for user-provided content if they have implemented “a policy that provides for the termination in appropriate circumstances of subscribers and account holders” who are repeat infringers. 17 U.S.C. § 512(i)(1)A).

Sony basically argued that this immunity would be unnecessary if ISPs are not liable for providing services to known infringers anyway. Why try to incentivize ISPs to terminate known infringers’ accounts if they are not at risk of liability even in the absence of the DMCA?

The DMCA, however, does not expressly impose liability for providing internet service to known infringers. Another DMCA provision says that failure to comply with the DMCA’s safe harbor conditions “shall not bear adversely upon . . . a defense by the service provider . . . that the service provider’s conduct is not infringing.” 17 U.S.C. § 512(l).

To put it more colloquially, the DMCA’s safe harbor provisions are meant to be a shield, not a sword.

Intent

Although intent has never been an essential element of a copyright infringement claim, Justice Thomas interpreted the Court’s precedents as imposing an intent requirement in contributory infringement claims:

“The provider of a service is contributorily liable for the user’s infringement only if it intended that the provided service be used for infringement. The intent required for contributory liability can be shown only if the party induced the infringement or the provided service is tailored to that infringement.”

Cox Communications v. Sony Music, at 7.

Justice Sotomayor’s Concurrence

Justice Sotomayor agreed that an ISP cannot be held contributorily liable for copyright infringement unless intent is established. She filed a concurring opinion, however, to dispute that inducement and tailoring a product to infringing uses are the only two situations that may support a finding of intent. She would have held the door open for other ways of establishing intent under common law “aiding and abetting” theory.

She also criticized the majority’s interpretation of the DMCA:

“The majority’s decision thus permits ISPs to sell an internet connection to every single infringer who wants one without fear of liability and without lifting a finger to prevent infringement. It also means that Cox is free to abandon its current policy of responding to copyright infringement. [U]nder the rule the majority adopts today, the safe harbor provision will not “d[o] anything at all” going forward. . . . Congress did not enact the safe harbor just so that this Court could eviscerate it.”

Cox Communications v. Sony Music (J. Sotomayor, concurring opinion) (citations omitted) at 6–7.

Nevertheless, because she did not believe the requisite showing of intent had been made in this case, she concurred in the judgment.

Limitations

 Cox Communications v. Sony Music only applies to internet service providers, what the common law described as “conduits.” It does not directly apply to people who copy, distribute or host infringing material.

Also, the Court noted that an ISP normally does not actually have knowledge of the identity of the user who is committing direct infringement. It has records of IP addresses associated with accounts, but a single IP address might be used by multiple people, not all of whom are infringers. It is possible that in a different case, where the defendant actually does know the identity of the specific direct infringer, the requisite finding of intent might be easier to make. Future cases will need to flesh that out.

Implications

As Congress and courts grapple with emerging generative AI copyright issues, it is likely that attempts will be made to apply the principles announced in Cox Communications v. Sony Music to generative AI architecture. While the internet is a neutral data conduit, large language models that drive generative-AI function by ingesting massive datasets of protected works to optimize their commercial output. Rights holders argue that building a system dependent on unauthorized ingestion constitutes direct or secondary infringement. However, the intent requirement articulated in Cox provides AI developers with a potentially expansive defense to output infringement. If providing a tool with the simple knowledge that users may generate infringing outputs is legally insufficient, then the battleground over generative AI must shift. Because generative AI tools arguably have substantial, non-infringing uses, litigators will need to prove intent to induce infringement to prevail on a contributory output infringement claim. The potential impact on input infringement claims, of course, is a different matter.

We are already seeing this defense framework reshape federal dockets. In June 2026, tech platforms seized upon the Cox precedent to try to stop copyright claims at the pleadings stage. In a motion filed in Tennessee federal court, X Corp. invoked Cox v. Sony Music to argue that music publishers’ secondary liability claims must be dismissed, asserting that the plaintiffs failed to allege explicit “affirmative inducement” rather than general platform piracy.

Practical Tip

Despite the Court’s ruling in Cox Communications v. Sony Music, platform providers may find it prudent to continue to comply with DMCA safe harbor requirements. Not only could this help them qualify for the immunities the DMCA provides, but it might also help demonstrate a lack of infringing intent.

Can You Copyright a Band Name?

It is one of the most common questions artists, entrepreneurs, and other content creators ask. It is also based on a fundamental misunderstanding of how intellectual property works. While both copyrights and trademarks give owners exclusive rights, they protect entirely different things for entirely different purposes.

You just finished a killer garage rehearsal with your new band. You finally agreed on the perfect name, and you are ready to launch a website, release an album, and book your first gig. Naturally, your first instinct is to protect your new brand before someone else steals it. So, you call up a legal professional and ask: “Can you copyright a band name? If so, how?”

5 tuba players posing with their instruments, not sure if they can copyright a band name

It is one of the most common questions artists, entrepreneurs, and other content creators ask. It is also based on a fundamental misunderstanding of how intellectual property works. While both copyrights and trademarks give owners exclusive rights, they protect entirely different things for entirely different purposes.

If you want to protect your music, your brand, and your business identity, you need to understand where copyright ends and trademark begins. I will start with the short answer first.

Can you copyright a band name? No. Copyright ownership cannot be claimed in the name of a band or any other kind of name. Copyright protection does not exist for titles, slogans or short phrases, either. In some cases, trademark rights can be claimed in a name, title, slogan or short phrase, but copyright cannot be.

Names, titles, slogans and short phrases are too short to qualify as “expression”, and they do not meet the low threshold of human creativity required for a copyright. Instead, identifying a brand is the core of trademark law.

What is the difference between a copyright and a trademark?

Copyrights and trademarks are both types of intellectual property, and they both give their owners exclusive rights, but they protect different interests, for different purposes. Copyrights protect creative expression. Trademarks protect brand identifiers.

  • Copyrights protect creative expression. They protect interests in the output of human minds, things like music, lyrics, artwork, website text, photographs, sound recordings, music videos, and other kinds of expression.
  • Trademarks protect brand identifiers. They protect names, logos, slogans, and domain names used to identify goods or services. The purpose of a trademark is to act as a source indicator and prevent consumer confusion in the marketplace.

The USPTO has a handy reference chart explaining how the kinds of intellectual property differ: Patent, Trademark or Copyright.

When does a copyright actually come into existence?

You get a copyright when, and only when, all of the following things are present:

  1. Human expression. Copyright protects expression, not facts or ideas. And the expression must be created by a human, not by an animal, a machine or natural forces.
  2. Originality. The work must be independently created. Copyrights cannot be acquired by copying someone else’s work.
  3. Creativity. People frequently conflate the “originality” and “creativity” requirements, but they are really different things. Band names are a great example. You could come up with a completely original name, one that nobody else has ever used before, and yet still fail the creativity test. “Smashing Pumpkins,” for example, was a completely original name. No band had ever used it before. But it does not get copyright protection. Why not? Because the courts and the Copyright Office have decided that names, titles, slogans and short phrases do not involve a high enough level of creativity.
  4. Fixation in a tangible medium. The work must be fixed in a tangible medium of expression. This means it exists in a sufficiently permanent or stable form so that it can be perceived, reproduced, or communicated for more than a transitory period. Examples include writing lyrics on paper, recording an MP3, or painting on canvas.

When all of these requirements are met, copyright protection is automatic. You do not need to register your work with the U.S. Copyright Office for the copyright to exist, but you generally do need to register it if you ever want to file an infringement lawsuit in court.

Why You Actually Need a Trademark for a Band Name

Getting back to the difference between trademarks and copyrights: when it comes to protecting a band name, a song title, a short phrase or a slogan, a trademark is what you need.

Trademarks do not have to be particularly creative. Look at IBM. It’s just an acronym for “International Business Machines.” Nevertheless, it is a valid trademark. As I reported in a previous blog post, even the word “The” is a registered trademark now.

You might be asking, “Well, how can someone claim the exclusive right to use the word ‘the’? Virtually every book, story, and article that’s written has “the” in it. Are all these writers guilty of infringement?

The answer is no. And that is because a trademark only gives its owner the exclusive right to use it as a source identifier. Unlike a copyright, it does not give its owner an exclusive right to use the mark as creative expression.

The 5 Core Requirements for a Trademark

The requirements for a valid trademark indicate the limited scope of its enforceability. To secure and maintain a trademark, you must satisfy five elements:

  •  Use in commerce
  • Source identification
  • Distinctiveness
  • No likelihood of confusion
  • Nonfunctionality.

1. Use in Commerce & Source Identification

“Use in commerce” means the mark must be used commercially. If you market musical performance services under a particular band name, you might be able to claim trademark rights.

It must be used for the purpose of identifying the source of your musical performance services, though. Merely using something as a band name isn’t enough. For example, if you and some friends have formed a band to practice in a garage, but you haven’t actually started seeking gigs and have no definite plans to do so, choosing a name is not enough. To get a trademark, you must use the name commercially. That does not mean you have to be a commercial success. It just means you need to have begun selling your services, such as booking performances.

2. Distinctiveness and No Likelihood of Confusion

“Distinctiveness” means your band name must distinguish your band from others. If you name yourselves, “A Jazz Band,” you will probably fail this test. Descriptive terms generally lack distinctiveness. Arbitrary or completely made-up names have a much better chance. If you mention Pearl Jam, or the Rolling Stones, or Nirvana, everybody knows exactly which band you mean.

Distinctiveness is directly related to the requirement that the name must not cause a likelihood of confusion among consumers. You won’t get trademark protection if you call yourselves Counting Crows, for instance, because consumers will confuse you with the existing band.

3. Nonfunctionality

The nonfunctionality requirement means that a trademark must not serve a utilitarian purpose other than being a source identifier. For example, you can’t claim the sound of a drum as a trademark for your band. As great as it might be to claim the exclusive right to use the sound of a drum and put other bands out of business, you cannot do that because it serves a fundamental musical function.

You often hear people say that a band has a “trademark sound,” like the wailing sounds that Jimi Hendrix produced on his guitar. In reality, no one can claim trademark rights in a particular musical sound or style, though, as those are functional elements of musical performances.

Once you have a trademark that meets these requirements, you should apply to register it as a trademark. This can be started even before you begin using it in commerce, so long as you have a definite plan to start using it soon.

Key Takeaways for Musicians and Bands

And so the key takeaways from all of this are:

  • Copyrights protect expression; trademarks protect brand identifiers.
  • You cannot claim a copyright in a name, title, slogan or short phrase, but you might be able to claim a trademark.
  • If you want to claim a copyright in a song, you must fix it by writing it down or recording it.
  • To claim a trademark in a name, you must use it in commerce as a source identifier.
  • Choose a distinctive name that does not simply describe your music and is completely different from other bands.
  • Protect your trademark by registering it.

Ready to Protect Your Band?

Navigating the intersection of copyright and trademark law can be challenging, but taking the right legal steps early protects your creative work from copycats. Whether you are ready to book your first commercial gig, launch a website, or officially register your band name and other brand identifiers, securing your intellectual property is the smartest move for your band. Contact me if you need help registering a trademark or protecting your creative works.Visit my extensive Copyright FAQs page.

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.

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. 

Other Legal Topics

Constitutional law acquired renewed relevance in 2025, with issues running the gamut from freedom of speech to the separation of powers.

Dramatic changes in family structures and sex roles have been accompanied by major changes in family law, particularly in regard to the custody of children. More jurisdictions are warming up to the ideas of joint custody and shared parenting.

E-commerce law, too, is rapidly evolving, as more and more businesses supplement their physical presence with an online one. A growing number of businesses operate exclusively online. This has raised a wide range of legal issues entailing significant permutations of existing laws, and in some cases, brand new laws and legal frameworks.

As I mentioned at the outset, it would be neither possible nor useful for me to catalog every new legal development in a blog like this. The best I can do is highlight a few of them from time to time.

In this category is a post I wrote about a continuing legal education program I presented with Donald Hubin (National Parents Organization) and Professor Daniel Fernandez-Kranz:

Joint Custody and Equal Shared Parenting Laws

Pertinent to e-commerce law is an article I wrote about the sales and use tax “nexus” requirement for taxes on online sales: 

“Sales and Use Tax Nexus: The Way Forward for Legislation” by Tom James

 

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.