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Ninth Circuit Shows Led Zeppelin a Whole Lotta Love in ‘Stairway’ Copyright Win

by Sarah Bro | Mar 25, 2020 | Copyrights

Ruling en banc, the US Court of Appeals for the Ninth Circuit reinstated a 2016 jury verdict, finding that the rock band Led Zeppelin and the opening notes of its hit song “Stairway to Heaven” did not infringe the 1967 song “Taurus” by the band Spirit. Michael Skidmore v. Led Zeppelin et al., Case No. 16-56057 (9th Cir., March 9, 2020) (en banc) (McKeown, J.) (Bea and Ikuta, JJ., dissenting).

The en banc decision addressed a “litany of copyright issues”—the most critical being the interplay between the 1909 and 1976 Copyright Acts and the Court’s reversal of its own precedent in rejecting a doctrine occasionally referred to as the “inverse ratio rule”—when it concluded that, regardless of a copyrighted work’s fame, all plaintiffs must satisfy the same standard of proof in showing that an allegedly infringing work is substantially similar to the copyrighted work.

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Failure to Mitigate Not a Complete Defense to Statutory Damages Under Copyright or DMCA

by Sarah Bro | Jan 29, 2020 | Copyrights

On an issue of first impression in a copyright infringement dispute out of the Southern District of Texas, the US Court of Appeals for the Fifth Circuit confirmed that failure to mitigate is not a complete defense to copyright or Digital Millennium Copyright Act (DMCA) claims for statutory damages. Energy Intelligence Grp., Inc. et. al., v. Kayne Anderson Capital Advisors, LP, et. al., Case No. 18-20350 (5th Cir., January 15, 2020) (Higginson, J.).

In 2014, energy industry publisher Energy Intelligence Group, Inc. and its affiliated entity in the United Kingdom (together, EIG) filed suit against energy securities investment firm Kayne Anderson Capital Advisers (KA), alleging copyright infringement and abuses of the DMCA based on a KA partner’s violation of US copyright law and violation of his subscription agreement for EIG’s Oil Daily newsletter, which provides news and analysis about the North America petroleum industry. The jury in the district court proceeding found that EIG could have reasonably avoided almost all of the alleged copyright and DMCA violations through real-time investigations and enforcement efforts, and thus awarded EIG just over $500,000 in statutory damages for the infringement of 39 works of authorship. The district court, however, still applied the Copyright Act’s fee shifting provisions and awarded EIG over $2.6 million in attorney’s fees and costs. The parties’ consolidated appeals to the Fifth Circuit thus presented an issue of first impression: namely, whether the failure to mitigate copyright infringement is a complete defense to liability for statutory damages under the Copyright Act and the DMCA.

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A Mixed Bag on New Rules – Juggling Copyright Preclusion and Patent Infringement

by McDermott Will & Emery | Jan 15, 2020 | Copyrights, Patents

Addressing issues of copyright and patent infringement, the US Court of Appeals for the Federal Circuit found that the Federal Insecticide, Fungicide, and Rodenticide Act did not preempt copyright protection and that patent infringement under 35 U.S.C. § 271(g) does not require that the claimed process be performed by a single entity. Syngenta Crop Protection, LLC v. Willowood, LLC, Case Nos.18-1614, -2044 (Fed. Cir., Dec. 18, 2019) (Reyna, J.).

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Vimeo’s Fleeting Interaction With Videos Doesn’t Negate Safe Harbor Protections

by Taylor MacDonald | Jan 23, 2025 | Copyrights

The US Court of Appeals for the Second Circuit affirmed a district court’s decision, granting Vimeo qualified protection under the Digital Millennium Copyright Act (DMCA) safe harbor provision. Capitol Records, LLC v. Vimeo, Inc., Case Nos. 21-2949(L); -2974(Con) (2d Cir. Jan. 13, 2025) (Leval, Parker, Merriam, JJ.) This case addresses, for the second time, whether Vimeo had “red flag knowledge” of the defendant’s copyrighted works under the DMCA.

DMCA Section 512(c) provides a safe harbor that shelters online service providers from liability for indirect copyright infringement on their platforms under certain conditions. Congress provided two exceptions that would remove the safe harbor protection:

Actual or red flag knowledge of infringing content
The ability to control content while receiving a financial benefit directly attributable to the accused infringement activity.

EMI, an affiliate of Capitol Records, vehemently opposed Vimeo’s inclusion of videos containing EMI’s music on its site and initiated the present suit in 2009. The district court granted summary judgment in favor of Vimeo, dismissing the plaintiffs’ claims on the ground that Vimeo was entitled to the safe harbor protection provided by Section 512(c). EMI appealed.

In a 2016 appeal (Vimeo I ), the Second Circuit considered Vimeo’s activities under the DMCA. In Vimeo I, the Court (in the context of an interlocutory appeal) ruled that the copyright holder must establish that the service provider (e.g., Vimeo) had “knowledge or awareness of infringing content,” and that the service provider bore the initial burden to prove it qualified for the DMCA safe harbor, whereupon the burden shifted to the copyright holder to prove a disqualifying exception.

Knowledge of Infringement

In Vimeo I, the Second Circuit cited its 2012 decision in Viacom Int’l v. You Tube and explained that red flag knowledge incorporates an objective standard. The facts actually known to the service provider must be sufficient such that a reasonable person would have understood there to be infringement that was not offset by fair use or a license. Vimeo I clarified that service provider employees who are not experts in copyright law cannot be expected to know more than any reasonable person without specialized understanding.

The Second Circuit explained that this knowledge analysis is a fact-intensive one, and that copyright owners cannot rely on service provider employees’ generalized understanding to prove red flag knowledge for any video (or other work). The Vimeo I court also noted that the DMCA did not place a burden on service providers to investigate whether users had acquired licenses. In Vimeo I, the Second Circuit further instructed that because the legal community cannot agree on a universal understanding of fair use, it would be unfair to expect “untutored” service provider employees to determine whether a given video is not fair use on its face.

Right and Ability to Control

In analyzing what constitutes the right and ability to control, the Second Circuit emphasized that Congress’ purpose behind the DMCA was to effect a compromise between rightsholders and safe harbor claimants: “Congress recognized that the [...]

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Untwisting the Fixation Requirement: Flexible Rules on Moveable Sculptures

by Hannah Hurley | Jan 23, 2025 | Copyrights

The US Court of Appeals for the Ninth Circuit reversed and remanded a district court’s dismissal of a claim of copyright infringement for kinetic and manipulable sculptures, finding that movable structures were sufficiently “fixed” in a tangible medium for copyright purposes. Tangle, Inc. v. Aritzia, Inc., et al., Case No. 23-3707 (9th Cir. Jan. 14, 2024) (Koh, Johnstone, Simon, JJ.)

Tangle, a toy company, holds copyright registrations for seven kinetic and manipulable sculptures, each made from 17 or 18 identical, connected 90-degree curved tubular segments. These sculptures can be twisted or turned 360 degrees at the joints, allowing for various poses. Aritzia, a lifestyle apparel brand, used similar sculptures in its retail store displays, leading Tangle to file a lawsuit alleging copyright and trade dress infringement. Aritzia’s sculptures were larger, were a different color, and had a chrome finish.

The Copyright Act requires that a work of authorship be “fixed in any tangible medium of expression.” 17 U.S.C. § 102(a). At the pleading stage, the district court concluded that the sculptures were not fixed and thus dismissed Tangle’s copyright claim. The district court also dismissed the trade dress claim for failure to provide adequate notice of the asserted trade dress. Tangle appealed.

While the Ninth Circuit agreed with the district court’s dismissal of the trade dress claim, it disagreed with the district court’s ruling on the copyright claim. Comparing the kinetic, movable sculptures to music, movies, and dance, the Court found that Tangle’s dynamic sculptures were entitled to copyright protection and that Tangle adequately alleged valid copyrights in its sculptures. The Court held that the works’ ability to move into various poses did not, by itself, support the conclusion that they were not “fixed” in a tangible medium for copyright purposes.

The Ninth Circuit held that under the “extrinsic test” test, which looks at “the objective similarities of the two works, focusing only on the protectable elements of the plaintiff’s expression,” as set forth in the Court’s 2018 decision in Rentmeester v. Nike, Tangle plausibly alleged copying of its protected works by alleging that the creative choices it made in selecting and arranging elements of its copyrighted works were substantially similar to the choices Aritzia made in creating its sculptures.

Since Aritzia failed to dispute that Tangle had properly alleged copying, the Ninth Circuit stated that Tangle only needed to show that the sculptures were substantially similar to prove infringement. Applying its 2004 decision in Swirsky v. Carey, the Ninth Circuit explained that “substantial similarity can be found in a combination of elements, even if those elements are individually unprotected.”

The Ninth Circuit found that the copyrighted and accused sculptures were similar enough to the ordinary observer to constitute infringement because both were comprised of identical, connected 90-degree curved tubular segments that could be twisted and manipulated to create many different poses. The Court further explained that the vast range of possible expressions could afford the sculptures broad copyright protection.

Just Compensation Based on Hypothetical Negotiation

by Paul Devinsky | Jan 16, 2025 | Copyrights

In a long-standing copyright dispute on its second visit to the US Court of Appeals for the Federal Circuit, the Court affirmed the modest damages award from the US Court of Federal Claims, ruling that a hypothetical negotiation between the parties would have resulted in a license in the amount awarded by the claims court. Bitmanagement Software GmBH v. United States, Case No. 23-1506 (Fed. Cir. Jan. 7, 2025) (Dyk, Stoll, Stark, JJ.)

In 2016 Bitmanagement sued the US Navy for copyright infringement of its software. The Court of Federal Claims awarded damages based on usage of the software, rather than the number of copies made. In the first appeal, the Federal Circuit agreed with the claims court that the Navy had an implied license to make copies of the software but was limited as to simultaneous users of the software, a condition that the Navy breached. The Federal Circuit remanded the case with the following instruction:

Because Bitmanagement’s action is against the government, it is entitled only to “reasonable and entire compensation as damages . . . , including the minimum statutory damages as set forth in section 504(c) of title 17, United States Code.” 28 U.S.C. § 1498(b).

The Federal Circuit further instructed the claims court that Bitmanagement was:

. . . not entitled to recover the cost of a seat license for each installation. If Bitmanagement chooses not to pursue statutory damages, the proper measure of damages shall be determined by the Navy’s actual usage of BS Contact Geo in excess of the limited usage contemplated by the parties’ implied license. That analysis should take the form of a hypothetical negotiation. . . . As the party who breached the . . . requirement in the implied license, the Navy bears the burden of proving its actual usage of the . . . software and the extent to which any of it fell within the bounds of any existing license.

Following this mandate, the claims court denied Bitmanagement’s damages demand of almost $86 million and awarded $154,000. Bitmanagement appealed, arguing that it was entitled to damages based on each copy of the software made, rather than damages based on use exceeding the implied license.

The Federal Circuit disagreed, explaining that the law does not require that every award of copyright damages be on a per-copy basis:

. . . whenever the copyright in any work protected under the copyright laws of the United States shall be infringed by the United States . . . the exclusive action which may be brought for such infringement shall be an action by the copyright owner against the United States in the Court of Federal Claims for the recovery of his reasonable and entire compensation as damages for such infringement . . .

As the Federal Circuit noted, the methods used to determine recovery of “actual damages” under § 504 are those “appropriate for measuring the copyright owner’s loss.” Therefore, in § 504(b) cases, the copyright owner must prove “the actual [...]

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Interoperability Doesn’t Imply Derivative Work

by Jodi Benassi | Jan 9, 2025 | Copyrights

The US Court of Appeals for the Ninth Circuit explained that to be a derivative work, a program interoperative with another must actually incorporate aspects of the underlying work. The Court further ruled that licensees of a copy of a computer program are not “owners” of the copy and therefore are not entitled to make copies for the purposes permitted by 17 U.S.C. § 117(a). Oracle International Corp. v. Rimini Street, Inc., Case No. 23-16038 (9th Cir. Dec. 16, 2024) (Bybee, Bumatay, Bennett, JJ.)

Rimini provides third-party support for Oracle software and is a direct competitor with Oracle in the software support services market. For more than a decade, Oracle and Rimini have been involved in what the Ninth Circuit describes as a “pitched copyright war.” This latest battle relates to changes Rimini made to its business model after a district court determined that Rimini had infringed Oracle’s copyrights. Rimini developed a new process for servicing customers using Oracle software and sought a declaratory judgment that its revised process did not infringe Oracle’s copyrights. Oracle counterclaimed for copyright infringement and Lanham Act violations.

The district court found that Rimini created infringing derivative works because its new process interacted and was usable with Oracle software. The district court found that Rimini violated Oracle’s PeopleSoft and Database licensing agreements and made several statements violating the Lanham Act. The court struck Rimini’s affirmative defense to copyright infringement under 17 U.S.C. § 117(a), granted Oracle summary judgment that Rimini infringed Oracle’s copyrights, and issued a permanent injunction against Rimini. Rimini appealed.

Derivative Works

The Ninth Circuit disagreed with the district court’s analysis of Rimini’s new process, noting that the district court focused on an “interoperability test,” which does not exist under the text of the Copyright Act or in precedent. In effect, the district court’s test would find that if a product interoperates with a preexisting copyrighted work, then it must be derivative. The Ninth Circuit explained that while the Copyright Act uses broad language to describe derivative works, the derivative work must actually incorporate the underlying work. For Rimini’s new process to be a derivative work, it must incorporate Oracle’s copyrighted work, either literally or nonliterally. The Court found that just because Rimini’s new process interacted with Oracle’s software, that was insufficient to find it was a derivative work.

Affirmative Defense: Section 117(a)

The Copyright Act permits an owner of a copy of a computer program to make a copy or adaptation of that program for certain purposes under 17 U.S.C. § 117(a). The Ninth Circuit vacated the district court’s ruling, striking Rimini’s affirmative defense under Section 117(a), because the district court erred in determining whether Oracle’s customers “owned” a copy of Oracle’s software, PeopleSoft. The Court explained that to determine whether a party is an “owner of a copy” of a computer program, the courts look to whether the party has “sufficient incidents of ownership” over the “copy” of the software, in view of the totality of the parties’ agreement. Factors that [...]

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Let’s Not Get It On: Battle of the Greatest Hits

by Kavya Rallabhandi | Nov 14, 2024 | Copyrights

The US Court of Appeals for the Second Circuit affirmed a district court ruling that Ed Sheeran’s 2014 hit “Thinking Out Loud” does not infringe the copyright on Marvin Gaye’s 1973 classic “Let’s Get It On.” Structured Asset Sales, LLC v. Sheeran, Case No. 23-905 (2d Cir. Nov. 1, 2024) (Calabresi, Parker, Park, JJ.)

In 1973, Ed Townsend and Marvin Gaye wrote the Motown hit “Let’s Get It On.” Townsend subsequently registered a copyright for the song’s melody, harmony, rhythm, and lyrics by sending the deposit copy of sheet music to the US Copyright Office. Townsend, Gaye, and Motown Records each held a one-third share in the copyright. Structured Asset Sales (SAS) purchases royalty interests from musical copyright holders, securitizes them, and sells the securities to other investors. SAS owns a one-ninth interest in the royalties from “Let’s Get It On.” Townsend’s remaining two-ninths share in the copyright is split between Kathryn Griffin, Helen McDonald, and the estate of Cherrigale Townsend.

In 2014 Ed Sheeran and Amy Wadge wrote the global chart-topper and Grammy-award-winning song “Thinking Out Loud.” In 2018, SAS brought a copyright infringement suit against Sheeran, Wadge, and various entities that produced, licensed, and distributed “Thinking Out Loud” (collectively, Sheeran). SAS alleged similarities in harmonies, drums, bass lines, tempos, and chord progression combined with anticipation (harmonic rhythm). SAS’s lawsuit followed the Griffin/McDonald/estate of Cherrigale Townsend’s 2017 lawsuit against Sheeran (Griffin lawsuit) alleging materially similar claims.

The district court determined that SAS’s infringement claim was limited to the scope of Townsend’s registration as reflected in the deposit copy (i.e., the sheet music) and excluded the sound recording of “Let’s Get It On.” As evidence that the songs were similar, SAS’s expert witness testified that the “Let’s Get It On” deposit copy included an inferred bass line that matched the bass line in Gaye’s sound recording of “Let’s Get It On” and the bass line in “Thinking Out Loud.” The district court rejected this testimony, concluding that “copyright law protects only that which is literally expressed, not that which might be inferred or possibly derived from what is expressed.”

The district court then denied Sheeran’s two motions for summary judgment without prejudice, determining that whether chord progression and harmonic rhythm in “Let’s Get It On” demonstrated sufficient originality and creativity to warrant copyright protection was a factual question to be determined at trial. Sheeran filed a motion for reconsideration. After the jury in the Griffin lawsuit found that Sheeran did not infringe the “Let’s Get It On” copyright, the district court granted Sheeran’s motion for reconsideration and concluded that “[t]here is no genuine issue of material fact as to whether defendants infringed the protected elements of [‘Let’s Get It On’]. The answer is that they did not.” SAS appealed.

SAS argued that the district court erred in limiting the evidence SAS could present to support its infringement claim and in granting summary judgment in favor of Sheeran. The Second Circuit rejected both arguments.

The Second Circuit explained that excluding the audio recording of “Let’s Get It On” was not error because the 1909 Copyright Act protects [...]

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If Provider Knew Product Would Be Used to Infringe, It Is a Contributor

by Lois D. Mermelstein | Oct 24, 2024 | Copyrights

In a case brought by a group of record labels against an internet service provider (ISP) for contributory copyright infringement of more than 1,400 songs, the US Court of Appeals for the Fifth Circuit ruled that the provider, which knew how its product would be used by subscribers, could be contributorily liable for its subscribers’ actions, but that because the record companies registered albums – not individual songs – with the US Copyright Office, statutory copyright damages were not available for each infringed song. UMG Recordings, Inc. et al. v. Grande Communications Networks, LLC, Case No. 23-50162 (5th Cir. Oct. 9, 2024) (Higginson, Higginbotham, Stewart, JJ.)

The plaintiffs are a group of major record labels, while the defendant, Grande Communications Network, is a large ISP. To combat copyright infringement among individuals using peer-to-peer file-sharing networks such as BitTorrent, the plaintiffs used a third-party company, Rightscorp, to identify infringing conduct by engaging with BitTorrent users, documenting that conduct, and using the information to notify ISPs of its findings so that the ISPs could take appropriate action. However, for nearly seven years Grande did not terminate subscribers for copyright infringement but merely notified them of a complaint. In the district court, a jury found Grande liable for contributory copyright infringement of more than 1,400 of the plaintiffs’ sound recordings. The jury found that the infringement was willful and awarded nearly $47 million in statutory damages. Grande appealed.

The Fifth Circuit explained that to prove direct infringement by Grande’s subscribers, the plaintiffs had to show “(1) that Plaintiffs own or have exclusive control over valid copyrights and (2) that those copyrights were directly infringed by Grande’s subscribers.” To meet the elements of secondary liability for subscribers’ conduct, “Plaintiffs had to demonstrate (3) that Grande had knowledge of its subscribers’ infringing activity and (4) that Grande induced, caused, or materially contributed to that activity.”

In analyzing the fourth element, the Fifth Circuit noted that previous Supreme Court cases involving a single moment of sale (Sony Corp. of America v. Universal City Studios (1984) and Metro-Goldwyn-Mayer Studios v. Grokster (2005)) did not control because the plaintiffs’ theory of liability was “not based on Grande’s knowledge about its subscribers’ likely future activities after the moment of sale, but rather on Grande’s knowledge of its subscribers’ actual infringements based on its ongoing relationship with those subscribers.” Further, unlike Twitter v. Taamneh (2023) (a case in which family members of an ISIS terrorist attack victim alleged that US social media companies aided and abetted ISIS by permitting the group’s members to use the platforms for ISIS’s purposes), here the “direct nexus between Grande’s conduct and the tort at issue permits an inference that Grande’s knowing provision of internet services to infringing subscribers was actionable.”

The district court’s jury instructions – that Grande could be contributorily liable if Grande could have “take[n] basic measures to prevent further damages to copyrighted works, yet intentionally continue[d] to provide access to infringing sound recordings,” were not erroneous, as Grande had access to [...]

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What a Croc! False Claim That Product Feature Is Patented Can Give Rise to Lanham Act Violation

by Karen Gover | Oct 17, 2024 | Trademarks

The US Court of Appeals for the Federal Circuit reversed and remanded a grant of summary judgment on a false advertising claim, concluding that a cause of action under Section 43(a) of the Lanham Act can arise when a party falsely claims to hold a patent on a product feature and advertises that feature in a misleading way. Crocs, Inc. v. Effervescent, Inc., Case No. 2022-2160 (Fed. Cir. Oct. 3, 2024) (Reyna, Cunningham, JJ.; Albright, District J., sitting by designation).

Crocs, the well-known maker of molded foam footwear, sued several competitor shoe distributors for patent infringement in 2006. The case was stayed pending an action before the International Trade Commission but resumed in 2012 when Croc added competitor U.S.A. Dawgs as a defendant to the district court litigation. The case was stayed twice more, from 2012 to 2016 and 2018 to 2020. In between those stays, in May 2016, Dawgs filed a counterclaim against Crocs and 18 of its current and former officers and directors, alleging false advertising violations of Section 43(a) of the Lanham Act. 15 U.S.C. § 1125(a). The individual defendants were later dismissed from the action.

Dawgs claimed that Crocs deceived consumers and damaged its competitors by falsely describing its molded footwear material, which it calls “Croslite,” as “patented,” “proprietary,” and “exclusive.” Dawgs alleged that it was damaged by Crocs’ false advertisements and commercial misrepresentations because Crocs suggested that its competitors’ footwear material was inferior. Croslite is in fact not patented, as Crocs conceded.

Crocs argued in its motion for summary judgment that Dawgs failed as a matter of law to state a cause of action under Section 43(a) because the alleged advertising statements were directed to a false designation of authorship of the shoe products and not to their nature, characteristics, or qualities, as Section 43(a)(1)(B) requires. The district court agreed. Applying the Supreme Court’s 2003 decision in Dastar Corp. v. Twentieth Century Fox Film Corp. and the Federal Circuit’s 2009 decision in Baden Sports, Inc. v. Molten USA, Inc., the district court granted summary judgment to Crocs. It reasoned that falsely claiming to have “patented” something is similar to a false claim of authorship or inventorship, not to the types of false advertising prohibited by the Lanham Act. Dawgs appealed.

Dawgs argued that the district court’s application of Dastar and Baden to the circumstances of its case was inapposite, and the Federal Circuit agreed. In Dastar, the petitioner copied a television series in the public domain, made minor changes, and sold it as a video set, passing it off as its own. The Supreme Court held that a false claim of authorship does not give rise to a cause of action under the Lanham Act. Similarly, in Baden, the Federal Circuit found that a basketball manufacturer’s false suggestion that it was the author of the “innovative” “dual-cushion technology” in its basketballs did not give rise to a false advertising claim under the Lanham Act.

In this case, however, the Federal Circuit reasoned that Croc’s false [...]

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