In 1998, Congress enacted the Digital Millenium Copyright Act (“DMCA”). In addition to establishing the notice-and-take-down regimen with which website and blog owners are (or should be) familiar, the DMCA made it unlawful to “circumvent a technological measure that effectively controls access to” copyrighted material. (17 U.S.C. § 1201(a)(1)(A)). The Act set out some permanent exemptions, i.e., situations where circumvention is allowed. In addition, it gave the Librarian of Congress power to periodically establish new ones. These additional exemptions are temporary, lasting for three years, but the Librarian of Congress can and does renew them. On October 18, 2024, the Librarian of Congress issued a Final Rule renewing some exemptions and creating some new ones.

What is “circumvention of a technological measure”?

Circumventing a technological measure means “to descramble a scrambled work, to decrypt an encrypted work, or otherwise to avoid, bypass, remove, deactivate, or impair a technological measure, without the authority of the copyright owner.” (17 U.S.C. § 1201(a)(3)(A)).

So, no decrypting or unscrambling to get access to a copyrighted work. What else? Well, anything that involves avoiding or bypassing a technological measure without the copyright owner’s permission. You can’t do that, either.

A technological measure that “controls access to a work” can be anything that “requires the application of information, or a process or a treatment, with the authority of the copyright owner,” to gain access to the work.” (17 U.S.C. § 1201(a)(3)(B)). Entering a password-protected website without a password the copyright owner has authorized you to use is an example.

The permanent exemptions

Section 1201 of Title 17 lists permanent exemptions for:

• Nonprofit libraries, archives, and educational institutions that circumvent copyright protection measures solely for the purpose of determining whether to acquire a copy of the work for a permitted purpose
• Law enforcement, intelligence, and government activities
• Reverse engineering
• Encryption research
• Prevention of access of minors to material on the Internet
• Prevention of the collection or dissemination of personally identifying information
• Security testing

Detailed conditions apply to each of these exemptions. If you are thinking of invoking one of them, read the entire statutory provision carefully and seek professional legal advice.

Renewed temporary exemptions

The following temporary exemptions have been renewed for another 3-year term:

• Fair use of short portions of motion pictures for certain educational and derivative uses

This includes use in a parody or in a documentary film about the work’s biographical or historically significant nature; use in a noncommercial video; use in nonfiction multimedia e-books; use for educational purposes by educational institution faculty and students; educational uses in Massive Open Online Courses; and educational uses in nonprofit digital and media literacy programs offered by libraries, museum, and other organizations.

• Closed captioning and other disability access services by disability service offices or similar units at educational institutions for students, faculty or staff with disabilities
• Preservation of copies of motion pictures by an eligible library, archives, or museum
• Scholarly research and teaching involving text and data mining of motion pictures or electronic literary works by researchers affiliated with a nonprofit educational institution
• Literary work or previously published sheet music that is distributed electronically and include access controls that interfere with assistive technologies
• Access to patient data on medical devices or monitoring systems
• Computer programs that unlock wireless devices to allow connection of a device to an alternative wireless network
• “Jailbreaking” computer programs (computer programs that enable electronic devices to interoperate with or to remove software applications), for the purpose of jailbreaking smartphones and other portable all-purpose computing devices, smart televisions, voice assistant devices, and routers and dedicated networking devices
• Computer programs that control motorized land vehicles, marine vessels, and mechanized agricultural vehicles for the purposes of diagnosis, repair, or modification of a vehicle or vessel function
• Diagnosis, maintenance or repair of devices designed primarily for use by consumers
• Access to computer programs that are contained in and control the functioning of medical devices or systems, and related data files, for purposes of diagnosis, maintenance, or repair
• Security research
• Individual play by video gamers and preservation of video games by a library, archives or museum for which outside server support has been discontinued, and preservation by a library, archives, or museum of discontinued video games that never required server support
• Preservation of computer programs by libraries, archives, and museums
• Computer programs that operate 3D printers to allow use of alternative material
• Investigation of potential infringment of free and open-source computer programs

Again, detailed conditions apply to each of these exemptions. If you are thinking of invoking one of them, read the entire provision carefully and seek professional legal advice.

New Exemptions

New 3-year exemptions the Librarian of Congress just announced in October, 2024 include:

• Sharing of copies of corpora by academic researchers with researchers affiliated with other nonprofit institutions of higher education for purposes of conducting independent text or data mining research and teaching, where those researchers are in compliance with the exemption
• Diagnosis, maintenance and repair of retail-level commercial food preparation equipment
• Access, storage and sharing of vehicle operational and telematics data generated by motorized land vehicles and marine vessels

And once again, detailed conditions apply to each of these exemptions. If you are thinking of invoking one of them, read the entire provision carefully and seek professional legal advice.

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In recent years, the United States Supreme Court has been grappling with the thorny question of how the First Amendment applies to trademarks. In this blog post, attorney Thomas B. James attempts a reconciliation of recent pronouncements.

The Slants (Matal v. Tam)

Simon Tam, lead singer of the band, The Slants, tried to register the band name as a trademark. The USPTO denied the application, citing 15 U.S.C. § 1052(a). That provision prohibited the registration of any trademark that could “disparage . . . or bring . . . into contemp[t] or disrepute” any persons. The Fifth Circuit Court of Appeals declared the statute facially unconstitutional under the First Amendment. The U.S. Supreme Court affirmed.

The USPTO argued that the issuance of a registration certificate is “government speech.” Since the government and its members are not required to maintain neutrality in the views they express and are only required to maintain viewpoint neutrality when regulating private speech, the USPTO contended that it was not required to maintain viewpoint neutrality when deciding whether to issue a trademark registration certificate or not. The Court rejected that argument, holding that a trademark is private speech. As such, the government is not free to engage in viewpoint discrimination when deciding which ones to favor with a registration certification.

“If the federal registration of a trademark makes the mark government speech, the Federal Government is babbling prodigiously and incoherently.”

— Hon. Samuel Alito, in Matal v. Tam

Commercial speech

At one time, the Court took the position that the First Amendment does not protect commercial speech (speech relating to the marketing of products or services). Valentine v. Chrestensen (1942) (“[T]he Constitution imposes no . . . restraint on government as it respects purely commercial advertising.”)

In Virginia State Pharmacy Bd. v. Virginia Citizens Consumer Council (1976) the Court reversed its position on this point, declaring that “the free flow of commercial information” is important enough to warrant First Amendment protection.

The Court announced a framework for assessing the constitutionality of a restriction on commercial speech a few years later, in Central Hudson Gas & Elec. Co. v. Public Serv. Comm. of N.Y. (1980).

The Central Hudson test, as it has come to be known, holds, first, that commercial speech receives First Amendment protection only if it concerns lawful activity and is not false or misleading. If it clears those two hurdles, then government regulation of it is permissible only if the regulation directly advances a substantial government interest and is not more extensive than necessary to serve that interest. That is to say, the regulation must be narrowly tailored to advance a substantial government interest.

In other words, commercial speech receives an intermediate level of scrutiny. Unlike regulations of political speech, the government only needs to identify a “substantial” interest, not necessarily a “compelling” one. Also unlike political speech, the regulation in question does not have to be the least speech-restrictive means of achieving it. It is required to be no more extensive than necessary to serve the interest in question, however.

In Tam, the Court held that it did not need to decide whether trademarks are commercial speech or not. The Court rejected the government’s contention that it has a substantial interest in protecting people from hearing things they might find offensive, declaring that “the proudest boast of our free speech jurisprudence is that we protect the freedom to express ‘the thought that we hate.'” See United States v. Schwimmer, 279 U. S. 644, 655 (1929) (Holmes,
J., dissenting).

The Court also rejected the second justification the government offered, that disparaging trademarks disrupt the flow of commerce. The statute, the Court held, is not narrowly drawn to eradicate invidious discrimination. Prohibiting registration of trademarks that disparage any person, group or institution, it would also prohibit registration of marks like “Down with racists” or “Slavery is an evil institution.”

The Court also identified what it described as a “deeper problem”:

If affixing the commercial label permits the suppression of any speech that may lead to political or social “volatility,” free speech would be endangered.

— Hon. Samuel Alito, in Matal v. Tam

In short, the Court acknowledged that commercial speech can have non-commercial expressive content. When that is the case, courts should zealously guard against government encroachment on private speech rights.

FUCT

Two years later, the Court was asked to review the USPTO’s refusal to register FUCT as a trademark. The Court came to the same conclusion about the portion of the statute that prohibited the registration of “scandalous” or “immoral” trademarks as it did about the prohibition against registering “disparaging” trademarks. Because this, too, involves viewpoint discrimination, the Court held that this prohibition, too, violates the First Amendment. Iancu v. Brunetti, 139 S. Ct. 2294 (2019)

Bad Spaniels (Jack Daniels v. VIP Properties)

The Court revisited trademark speech rights in 2023, in Jack Daniel’s Properties v. VIP Products.

I’ve written about this case before. Basically, Jack Daniel’s Property owned (and still owns) trademarks in the Jack Daniel’s bottle and in many of the words and graphics on its label for its alcoholic beverages. VIP Products began making and marketing a dog toy designed to look like a Jack Daniel’s whiskey bottle. The toy had labels affixed to it parodying the Jack Daniel’s label. For example, it used the phrase “Bad Spaniels” in place of “Jack Daniel’s.” And instead of “Old No. 7 Brand Tennessee Sour Mash Whiskey,” it displayed “The Old No. 2 On Your Tennessee Carpet.” Jack Daniel’s issued a cease-and-desist demand. In response, VIP Products filed a declaratory judgment action seeking a declaration that its parody neither infringed nor diluted Jack Daniel’s trademarks and, in any event, was a protected “fair use” under the First Amendment.

The district court rejected these claims, essentially holding that the First Amendment does not establish a “fair use” exception for the expressive aspect(s) of a trademark when it is used as a source-identifier for a product. The Ninth Circuit Court of Appeals reversed.

The United States Supreme Court reversed the Ninth Circuit. The Court opined that although using a trademark for an expressive purpose might qualify for First Amendment protection, that protection does not insulate the user from trademark infringement or dilution liability if it is also used as a source-identifier. Parodic uses are exempt from liability only if they are not used to designate the source of a product or service.

The Court did not mention Central Hudson or discuss the commercial speech doctrine. It is likely the Court did not feel a need to do that because trademark infringement involves trademarks that are claimed to be likely to confuse consumers about the source of a product or service. Such trademarks would not clear one of the first hurdles for commercial speech protection under Central Hudson, namely, that the speech must not be misleading.

“Trump Too Small” (Vidal v. Elster)

Steve Elster applied to federally register the trademark “Trump too small” to
use on shirts and hats. The USPTO denied the application, citing 15 U. S. C. §1052(c). That provision prohibits the registration of a mark that “[c]onsists of or comprises a name . . . identifying a particular living individual except by
his written consent.” Elster appealed, asserting that this statute infringed his First Amendment right to free speech.

The Federal Circuit Court of Appeals agreed with him. The U.S. Supreme Court, however, reversed the Federal Circuit, holding that this provision of the Lanham Act does not violate the First Amendment. Vidal v. Elster, 602 U.S. __ (2024).

The decision in this case is consistent with Jack Daniel’s. Unlike Jack Daniel’s, this case did not involve a claim that the use of the trademark was likely to cause consumer confusion about the source of the product. (After all, how likely would consumers be to mistakenly believe that Trump was marketing products ridiculing his own size?) In this case, the first two hurdles for commercial speech protection under Central Hudson would appear to have been cleared.

Reconciling this decision with Tam is not as easy. What happened to the idea the Court voiced in Tam that when commercial speech has non-commercial expressive content, courts should zealously guard against government encroachment on private speech rights?

The legislative history of Section 1052(c) demonstrates that the prohibition against using a living person’s name as part of a trademark was enacted for essentially the same reason that the prohibitions against disparaging, scandalous or immoral trademarks were: Members of Congress found the “idea of prostituting great names by sticking them on all kinds of goods” — like the idea of including scandalous, immoral or disparaging content in a trademark — to be “very distasteful,” and wanted “to prevent such outrages of the sensibilities of the American people.”¹ That was the very same kind of “interest” that the government invoked in Tam and that the Court found insufficient and not tailored narrowly enough to sustain the speech restriction at issue in that case. What was different here?

By requiring consent, Section 1052(c) effectively precludes the registration of a mark that criticizes an elected government official while allowing the official to register positive messages about himself or herself. HILLARY FOR AMERICA was permitted to be registered, but HILLARY FOR PRISON was not. It seems an awful lot like viewpoint discrimination, doesn’t it?

Why shouldn’t the politically expressive aspect of a trademark (as distinguished from the purely source-identifying aspect) receive the same exacting strict scrutiny analysis that normally applies to regulations of political speech?

Well, the Supreme Court did not think this case involved viewpoint discrimination. The requirement of consent to use a person’s name in a trademark applies to people of all political persuasions, the Court reasoned. Consent would be required to register a politician’s name as a trademark whether the politician in question is a Democrat, a Republican, a Communist, or anything else, and consent would be required whether the politician in question supports or opposes, say, abortion rights, or gun rights, or anything else.

Nevertheless, the fact remains that the statute, as applied, requires an elected official’s prior approval of a trademark before it can be registered. Maybe that doesn’t rise to the level of a direct prior restraint on speech, but it would certainly seem to have a chilling effect on political speech at the core of the First Amendment.

Conclusion

It is not at all clear to me that the cases can be reconciled on a logically coherent doctrinal basis. Reliance on the common law history of trademarks might support a determination that Section 1052(c) is not unconstitutional on its face. I am not completely convinced, however, that the Court was adequately responsive to the argument that the statute is unconstitutional as applied to the names of elected officials. But what do I know? I’m just some guy living next to a cornfield in the middle of nowhere.

1. See Respondent’s Brief at p. 7. ↩︎

What are your favorite generative-AI copyright issues? In this capsule summary, Cokato attorney Tom James shares what his three favorites are.

Generative artificial intelligence refers collectively to technology that is capable of generating new text, images, audio/visual and possibly other content in response to a user’s prompts. They are trained by feeding them mass quantities of ABC (already-been-created) works. Some of America’s biggest mega-corporations have invested billions of dollars into this technology. They are now facing a barrage of lawsuits, most of them asserting claims of copyright infringement.

Issue #1: Does AI Output Infringe Copyrights?

Copyrights give their owners an exclusive right to reproduce their copyright-protected works and to create derivative works based on them. If a generative-AI user prompts the service to reproduce the text of a pre-existing work, and it proceeds to do so, this could implicate the exclusive right of reproduction. If a generative-AI user prompts it to create a work in the style of another work and/or author, this could implicate the exclusive right to create derivative works.

To establish infringement, it will be necessary to prove copying. Two identical but independently created works may each be protected by copyright. Put another way, a person is not guilty of infringement merely by creating a work that is identical or similar to another if he/she/it came up with it completely on his/her/its own.

Despite “training” their proteges on existing works, generative-AI outfits deny that their tools actually copy any of them. They say that any similarity to any existing works, living or dead, is purely coincidental. Thus, OpenAI has stated that copyright infringement “is an unlikely accidental outcome.”

The “accidental outcome” defense seems to me like a hard one to swallow in those cases where a prompt involves creating a story involving a specified fictional character that enjoys copyright protection. If the character is distinctive enough — and a piece of work in and of itself, so to speak — to enjoy copyright protection (such as, say, Mr. Spock from the Star Trek series), then any generated output would seem to be an unauthorized derivative work, at least if the AI tool is any good.

If AI output infringes a copyright in an existing work, who would be liable for it? Potentially, the person who entered the prompt might be held liable for direct infringement. The AI tool provider might arguably be liable for contributory infringement.

Issue #2: Does AI Training Infringe Copyrights?

AI systems are “trained” to create works by exposing a computer program system to large numbers of existing works downloaded from the Internet.

When content is downloaded from the Internet, a copy of it is made. This process will “involve the reproduction of entire works or substantial portions thereof.” OpenAI, for example, acknowledges that its programs are trained on “large, publicly available datasets that include copyrighted works” and that this process “involves first making copies of the data to be analyzed….” Making these copies without permission may infringe the copyright holders’ exclusive right to make reproductions of their works.

Generative-AI outfits tend to argue that the training process is fair use.

Fair use claims require consideration of four statutory factors:

• the purpose and character of the use;
• the nature of the work copied;
• the amount and substantiality of the portion copied; and
• the effect on the market for the work.

OpenAI relies on the precedent set in Authors Guild v. Google for its invocation of “fair use.” That case involved Google’s copying of the entire text of books to construct its popular searchable database.

A number of lawsuits currently pending in the courts are raising the question whether and how, the AI training process is “fair use.”

Issue #3: Are AI-Generated Works Protected by Copyright?

The Copyright Act affords copyright protection to “original works of authorship.” The U.S. Copyright Office recognizes copyright only in works “created by a human being.” Courts, too, have declined to extend copyright protection to nonhuman authors. (Remember the monkey selfie case?) A recent copyright registration applicant has filed a lawsuit against the U.S. Copyright Office alleging that the Office wrongfully denied registration of an AI-generated work. A federal court has now rejected his argument that human authorship is not required for copyright ownership.

In March 2023, the Copyright Office released guidance stating that when AI “determines the expressive elements of its output, the generated material is not the product of human authorship.” Moreover, an argument might be made that a general prompt, such as “create a story about a dog in the style of Jack London,” is an idea, not expression. It is well settled that only expression gets copyright protection; ideas do not.

In September 2023, the Copyright Office Review Board affirmed the Office’s refusal to register a copyright in a work that was generated by Midjourney and then modified by the applicant, on the basis that the applicant did not disclaim the AI-generated material.

The Office also has the power to cancel improvidently granted registrations. (Words to the wise: Disclose and disclaim.)

These are my favorite generative-AI legal issues. What are yours?