The Prior Art

Monday Miscellany

The Patent Litigation Weekly column took a hiatus last week as I worked on IPLB's annual patent litigation survey and an upcoming cover story. To hold over readers, here's some interesting copyright & patent reading from the past week:

• News companies filed an amicus brief denouncing a judge's order in the "Catcher in the Rye" copyright case, saying she didn't take proper note of the First Amendment before enjoining publication: "Here a book was banned on the basis of a two-hour hearing with no witnesses."
• When The Prior Art last checked in on mystery inventor Gregory Bender, he and his lawyer had filed patent-infringement lawsuits against 28 companies. Now it's up to 37 defendants in 24 different suits, and Judge William Alsup has declined to relate the cases, despite the request of Bender's lawyer. 
• Zusha Elinson on the advantages and disadvantages of joint defense groups in patent lawsuits. (free reg. required)

Update 8/11/09: To clarify, Judge Alsup's order told the parties that it may be possible to coordinate hearings on claim construction and invalidity issues, but infringement issues will remain separate.

 

News exec to Google: We've got "Hot News," and we know how to use it.

Last week, a U.S. Senate committee engaged in the sort of navel-gazing about the future of journalism that is usually confined to, well, journalists. And this week, the usual suspects are pontificating about what the hearing meant.

There's a lot that could be said, but my attention was caught first and foremost by a sharp exchange between James Moroney, publisher and CEO of the Dallas Morning News, and Google Vice President Marissa Mayer. Moroney showed himself to be particularly well-informed about a certain legal doctrine, created for The Associated Press and recently reinvigorated in a lawsuit brought by that journalism organization: the "Hot News" doctrine. 

Committee chairman Sen. John Kerry (D-Massachusetts) teed up the exchange between Moroney and Mayer by asking the latter if she thought news organizations were paid enough for readers finding stories through a news aggregator like Google News. Kerry said:

"If you're you're out there doing the footwork and you've got a top level reporter in a bureau somewhere in the world, or you're doing a major investigative story and you put the pieces together... that takes money, it takes time, it takes skill... They're not going to get remunerated, for the level they put into that ... Is there a fairer way to try to spread the cost here?"

TPA Reading for the Week

A TPA extra edition--our mix of IP-related notes from this week:

• PatentFreedom, the patent defense consultancy run by Dan McCurdy, first talked to us about its database of NPEs (patent trolls) when the firm launched almost a year ago. Now, PatentFreedom is offering some of the basics from its database to the public--interesting stuff. Take a look, via Against Monopoly.

• French reject "three-strikes" law that would ban copyright infringers from the Internet. Lots of artists and content-side lawyers thought this one was going to pass. Not this time. Via Wired.com.

• Big Verdict: Mintz Levin won a $388 million patent infringement verdict against Microsoft for a case brought on behalf of a small California outfit, Uniloc. But will it stick?

• Big Verdict II: W.L. Gore & Associates (of Gore-Tex fame) must pay out $410 million to medical device company C.L. Bard. Via The Am Law Litigation Daily. Gore will appeal.

• Big Verdict III: A U.S. Court of Federal Claims judge has ordered NASA to pay a 1.25 percent royalty to Boeing because an aluminum alloy it used to build the space shuttle infringes Boeing patents. Damages still being briefed but looks like 9 digits. Seattle Times via IPO News, and The Am Law Daily.
  

• EFF senior attorney Fred Von Lohmann asks if President Obama violated copyright law when he gave an iPod to Queen Elizabeth.

• U.K. newspaper The Guardian showcases 15 years of anti-piracy videos.

Photo: L. Hine / Wikimedia

 

Challenges to the Google Book settlement, and a connection to Microsoft

The New York Times noted Friday that some challenges are being raised to the Google Book settlement; my colleagues at The Recorder are more interested in the fact that some of the opposition is funded by Google's rival, Microsoft. One of the New York Law School professors whose research is funded by Microsoft is James Grimmelmann. I've never spoken to him, but his lengthy analysis of the Google Book settlement, published in November, is the most insightful thing I've read about it. After reading the post, it really struck me how important this settlement will be to the future of reading as we know it.

Grimmelmann is also a former Microsoft employee, and wrote a great essay about working for the company back in 1997. The law professor made it clear to the NYT that he doesn't believe he or his colleagues' work has been influenced by Microsoft. He generally supports the settlement but also noted that he had concerns about antitrust and consumer rights, and suggested:

"Hot News" claims fail against Perez Hilton and newspaper obituaries

In February, I wrote about how a judge allowed The Associated Press' "hot news" lawsuit against an online news service to move ahead. I also wrote up a bit of the history of the "hot news" doctrine, which was created to give news organizations a "quasi-property" right in certain facts, even though facts cannot be copyrighted.

Readers who were interested in that post, and there were quite a few, would be interested to know that cyberlaw guru Eric Goldman has written recently about two more cases that involved "hot news" claims; that's three times it's come up in one month, leading Goldman to conclude that it must be "something in the water." One of those "hot news" claims was against celebrity gossip writer Perez Hilton, while another was part of a newspaper-on-newspaper fight in Pennsylvania over obituaries.

In one way, it's hard to think of anything less "hot" than an obit, but as the judge in that case notes, they do contain certain time-sensitive information. I can confirm, without any joy in my heart, that obits and funeral notices are some of the more popular content in smaller newspapers. When I worked at The Bakersfield Californian as an intern reporter, the funeral notices for the week frequently made it on to the "most read stories" list on the paper's web site. The "hotness" of that feature was always a bit depressing to us reporters, who spent the day pounding pavement to report news that was only occasionally more popular than a list of people have recently died. 

Image: Wikimedia / Sensor

The AP's "hot news" lawsuit lives on; are scoops "quasi-property?"

A New York federal judge ruled Tuesday that The Associated Press can sue its competitors not merely for copyright infringement, but for a "quasi property" right in the news known as the "hot news" doctrine. See the AP's own coverage.

Well, let it not be said that I fell down on the job when "hot news" crossed my beat. I took a look at both sides' motions and the judge's ruling to learn more about the case. The doctrine raises some questions for me about journalistic practice and ethics. And, it has some interesting history to boot.

According to 2nd Circuit law quoted in the order in this case [PDF], a "hot news" misappropriation claim is viable when:

(i) a plaintiff generates or gathers information at a cost;

(ii) the information is time-sensitive;

(iii) a defendant's use of the information constitutes free riding on the plaintiff's efforts;

(iv) the defendant is in direct competition with a product or service offered by the plaintiffs;

(v) the ability of other parties to free-ride on the efforts of the plaintiff or others would so reduce the incentive to produce the product or service that its existence or quality would be substantially threatened.

Personally, I can't see how all five of these don't apply to any news organization that's writing a story that follows a "scoop" by a competitor. 

The Gnu heads to court, files lawsuit against Cisco

The Free Software Foundation filed its first-ever copyright lawsuit yesterday, against Cisco Systems. The FSF accuses Cisco of not complying with the terms of the FSF's popular viral license, the General Public License, in the company's Linksys line of products. Anyone who distributes software or products that are GPL-licensed must provide source code when distributing it; by falling down on the GPL-vigilance front, "Cisco has denied its users their right to share and modify the software," say FSF lawyers.

The non-profit FSF has never before gone to court as a plaintiff to enforce the GPL, the license that founder Richard Stallman has called his "hack" of copyright law. But it has provided pro-bono legal services to open source developers who want to enforce their own GPL'd code, most notably in the BusyBox litigations.

A Cisco spokesperson stressed the company's commitment to open source, and responded that "We are currently reviewing the issues raised in the suit but believe we are substantially in compliance. We have always worked very closely with the FSF and hope to reach a resolution agreeable to the company and the foundation." (via Ars Technica)

Two big IP verdicts slip away from plaintiffs

Two historic verdicts, one copyright and one patent, were overturned this week.

• The recording industry's sole jury win in a music downloading case was overturned on appeal Wednesday. The problem was Jury Instruction No. 15, which told the jury the record companies don't have to prove any copyrighted files were actually transferred. Defendant Jammie Thomas was found liable and ordered to pay $222,000. But a federal judge in Duluth, Minnesota said that instruction was wrong, and Thomas will get a new trial. [Wired]

• Alcatel-Lucent's $1.5 billion jury verdict against Microsoft, for infringing patents on mp3 technology, was overturned  by the Federal Circuit. (That award had already been overturned by a district court judge; and the appeals court upheld that judge's decision.) If the Alcatel-Lucent award had been reinstated, it would have been the largest patent infringement verdict ever. [AP] [MarketWatch]

The biggest patent verdict instead remains Polaroid's lawsuit against Kodak's line of instant cameras; the suit wiped out Kodak's instant camera business by the late 1980's and awarded $910 million to Polaroid in 1991.

Alcatel-Lucent was represented by Kirkland & Ellis; Microsoft by Fish & Richardson.

 

EFF's "Dancing Baby" lawsuit will proceed; can fair use be "self-evident?"

This afternoon, a San Jose federal judge cleared the way for the Electronic Frontier Foundation's YouTube "dancing baby" lawsuit, Lenz v. Universal, to move forward. The case has been underway for about a year, and defendant Universal Music has twice tried to have the case dismissed; today the company failed definitively. Lenz, represented by lawyers from EFF, will be allowed to prosecute the case.

It started like this: the plaintiff, Stephanie Lenz, posted a 29-second video of her son Holden (at right) dancing to the Prince song "Let's Go Crazy." Universal Music sent her a takedown notice; Lenz shot back an email complaining about the takedown; she contacted EFF; her video went back up; she sued anyway. EFF and Lenz are seeking a declaration that she does not infringe copyright, and most importantly, damages under section 512(f) of the Digital Millennium Copyright Act.

Reading the EFF lawsuit and press release it's easy to forget that EFF actually initiated the litigation. What damages exactly did Lenz suffer?

Lessig and Obama

Last week, Barack Obama did a take-back on his pledge to accept public financing. That will have a big effect on the presidential campaign, of course, but Lawrence Lessig points out that it also will have an effect on the Congressional level, where politicians can't raise scads of small-donor Internet money, as Obama has been able to do on an unprecedented level. "I am worried about a decision that makes public funding for them less likely," he writes. "I wish he had decided differently."

Obama's announcement isn't good news for the new group Lessig is involved in, Change Congress, which wants to diminish the influence of money in politics; one of its central goals is to push politicians to support public financing. (The group works with both political parties.)

Getting pols to take that pledge will surely get tougher, for the time being, but Lessig urges supporters to take a longer view: "This is a hugely complex chess game."

Lessig is a professor at Stanford Law School who has moved his focus away from copyright issues to focus on Change Congress and political reform. But his new book, "Remix," is all about copyright law and culture. It's slated to be published in October but the AP v. blogosphere scandal inspired me to jump the gun by quoting Lessig on the importance of quotations. Quote-on-quote action, we call that.

Bloggers mock AP's "Quotation Licenses"

Cory Doctorow at BoingBoing has led an chorus of blogs in denouncing the AP's content licensing scheme, run by a company called iCopyright, which asks for payment for text snippets as short as five words, includes toughly worded copyright warnings, and has Terms of Use that seem to ban any criticism.

"Welcome to a world in which you won’t be able to effectively criticize the press, because you’ll be required to pay to quote as few as five words from what they publish," writes Doctorow.

I sympathize with these critics. Such restrictions, if enforced, would be intolerable. 

The price structure and terms of use was chosen by AP, while the "Honor Copyright" page (source of image at right) was authored by iCopyright, a copyright licensing company. It's not unusual for media companies to outsource the reprint side of their business; they're just not equipped to deal with it.

The AP's problem is that sometimes the headline is the whole story; the AP pays a lot of money to have a network of reporters so that someone is there when the bombs go off. It's looking for ways to get paid for that network in a declining market.

Sending takedown notices to bloggers who post 50-word quotes is not the right way to do that; the right to quote is a fundamental freedom, as I quoted Lawrence Lessig saying yesterday. But I can relate to the ambivalence of NYT Bits blogger Saul Hansell on this issue; like him, I'm both a reporter and a blogger. Like him, I'm concerned about the level of vitriol in the blogosphere about this issue, and I hope cooler heads prevail and seek a negotiated solution.

UPDATED: Post was updated to reflect some clarifications brought by an iCopyright employee (comment below). I speculated that iCopyright could have authored the Terms of Use, but those were chosen by AP. The publishers who work with iCopyright choose pricing, word intervals, terms of use, and other licensing options. Of the material I referenced, only the "Honor Copyright" page is authored by iCopyright.

 

The Associated Press v. The Quote

Last week, my former employer, The Associated Press, tried to erase seven quotations from the Internet, using copyright law. The noise since then has been remarkable.

The AP has acknowledged that its demand to remove seven short (33 to 79 words) quotes from The Drudge Retort blog was an overreach. But the news agency is standing by its basic argument, that copying of those lead sentences (or ledes as journalists sometimes write) is illegal and not fair use.

“Cutting and pasting a lot of content into a blog is not what we want to see,” Jim Kennedy, vice president of the AP and the blogosphere's new #1 enemy, told the New York Times. “It is more consistent with the spirit of the Internet to link to content so people can read the whole thing in context.”

Coincidentally, I spent all day on a plane today, and am now about halfway through Lawrence Lessig’s new book, "Remix." (I'm writing a review, to be published in a few months.) The book doesn't come out until October, but Lessig has a few passages on the freedom to quote that I think are apt here.

He writes:

Writing, in the traditional sense of words placed on paper, is the ultimate form of democratic activity, where, again, “democratic” doesn’t mean people vote, but instead means that everyone within a society has access to the means to write. We teach everyone to write—in theory, if not in practice. We understand quoting is an essential part of that writing. It would be impossible to construct and support that practice if permission were required every time a quote was made. The freedom to quote, and to build upon, the words of others is taken for granted by everyone who writes.

So what is the role of a quote in a world of hyperlinks? Quotes still matter because writing still matters; they are still fundamental to art, to journalism, and to freedom. To link is to point; to quote is to build an almost tangible connection between another’s ideas and your own. As the world’s largest news organization, the AP is essential to our democratic conversation. I am proud to have been an AP reporter, albeit for a short time, and I have many friends who work there, good reporters all. The organization’s recent skirmish with digital-age quotation is misguided; here's hoping it ends shortly and is not repeated.

 

Credibility Eliminator

Mattel Inc. is an enthusiastic litigant. In the name of defending Barbie's honor, the company has used trademark and copyright law as a cudgel to fight strippers, musicians, and most recently its competitor MGA Entertainment and former employee Carter Bryant.

MGA Entertainment makes the Bratz dolls, an increasingly popular doll that is "edgier" than Barbie. Mattel said those dolls infringe their copyrights.

Mattel reached a settlement with former employee Bryant in May; but they're still suing their competitor, claiming that Bryant was a Mattel employee when he created Bratz. If they can prove that, they will assert ownership over the $500 million Bratz product line.

The trial is underway in Los Angeles. Mattel is represented by Quinn Emanuel, MGA by Skadden Arps. On Tuesday a judge ruled that Mattel lawyers can present evidence that Bryant deleted a bunch of data from his hard drive shortly after Mattel first sued him in 2004. The name of the program he used—"Evidence Eliminator." Ouch. The judge was unimpressed.

NOTE: original post incorrectly stated that MGA was represented by Keker & Van Nest; that law firm represents only Carter Bryant, not MGA. It also stated the copyright claims were resolved on summary judgment.

UPDATE: Carter Bryant testified Thursday, see reports from the AP and the LA Times.

 

Lessig opposed to Orphan Works bill

Stanford Law Professor Larry Lessig's blog is on vacation, but he has an op-ed piece in today's New York Times opposing H.R. 5889, the Orphan Works bill that was passed by the House two weeks ago. 

The bill would allow libraries and others to use copyrighted works of indeterminate origin after a "diligent effort" to find who the owner is. But Lessig argues that "diligent" has a slippery definition. "The only beneficiaries would be the new class of 'diligent effort' searchers who would be a drain on library budgets," he writes.

Lessig's solution would be to give creators and automatic copyright for 14 years, and then require registration to receive continued copyright protection. (A 14-year copyright was the term endorsed by the nation's founders.) That would represent a partial rollback of the 1978 Copyright Act, which changed U.S. copyrights from an opt-in to an opt-out system.

Surprisingly (to me, at least) Lessig also says the bill is too easy on potential copyright infringers, who could be excused from "significant damages" if they can prove they made a diligent effort to find the copyright owner.

That puts Prof. Lessig out of step with the Electronic Frontier Foundation—which strongly supports the bill—as well as Public Knowledge, which says that a good Orphan Works bill should put a low damages cap (like $200 low) on payouts to a previously-unknown copyright holder who emerges and claims infringement.

 

House passes PRO-IP and Orphan Works bills

More posts to come on the Patent Troll Tracker saga later today, but a few things other things worth reporting this morning:

• This morning, the House of Representatives passed H.R. 4279, the so-called PRO-IP bill. The entertainment industry is crowing about that one, which will give them a long-sought after prize: a government commitment  to federal copyright cops at the Department of Justice.They’ll not only get a new “Intellectual Property Enforcement Division,” but the bill would carve out money from existing grants to combat computer crime and earmark part of that to police copyright infringement. Basically, the bill is meant to put some FBI muscle behind those FBI warnings on movies and TV shows.

Government lawyers, of course, would be far cheaper copyright cops than litigators at Hollywood law firms like Munger Tolles & Olson or Mitchell Silberberg & Knupp; especially when taxpayers foot the bill. And the industry might eventually get what it really wants—enforcement of criminal penalties.

The bill was sponsored by Detroit Democrat John Conyers. Only 11 Representatives voted against the bill on the floor—seven Republicans and four Democrats, including Silicon Valley Democrat Zoe Lofgren and former Democratic presidential candidate Dennis Kucinich.

• Before they took a mile, they gave an inch: the House IP subcommittee passed H.R. 5889, an “orphan works” bill that removes the massive penalties associated with copyright infringement if the work belongs to a copyright holder who can’t be identified or found. The bill was sponsored by Rep. Howard Berman, known as Hollywood's man in Washington. The bill moves ahead to the full Judiciary Committee. If passed, it goes into effect in 2013. Freedom to use orphan works has long been a cause of library activist like Internet Archive founder Brewster Kahle.

• Speaking of the Internet Archive, it was revealed yesterday that the FBI attempted to strongarm the non-profit into handing over subscriber information through the use of a national security letter. With the help of EFF attorneys, Kahle resisted, giving us the rare opportunity to take a look at what a (redacted) national security letter looks like. The letters have gag orders attached to them, so as EFF attorney Kurt Opsahl says, ""One of the most important victories here is that we can even say this letter was received." Recorder reporter Evan Hill has the Internet Archive story on today's Law.com newswire; EFF has more documents in Internet Archive v Mukasey, 07-6346-CW (N.D. Cal).

Update 5/28: This post split in two as a housekeeping measure; patent news half is here.