Articles Posted in Intellectual Property

Published on:

The question of whether varsity collegiate athletes should receive some form of compensation for their services to their teams–beyond any scholarship assistance they receive–has been the subject of much controversy for a very long time. The National Collegiate Athletic Association (NCAA) enforces strict amateurism rules that prohibit athletes from receiving multiple forms of compensation, including compensation for the use of their names, images, and likenesses. A district court ruled last year that this particular rule is a restraint of trade that violates Section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1. The Ninth Circuit Court of Appeals reversed the part of the order providing deferred compensation to players, but it affirmed the ruling that schools should be permitted to provide scholarships equal to the “full cost of attendance.” O’Bannon v. NCAA (“O’Bannon Appeal“), No. 14-16601, slip op. at 54 (9th Cir., Sep. 30, 2015).

For most people, a combination of intellectual property and privacy laws protects the right to one’s own name, image, and likeness, commonly known as “personality rights.” NCAA athletes, however, are prohibited from deriving any financial benefit from those rights. Schools often require them to sign away the rights to compensation for their personality rights, but no NCAA rule prevents the schools from using those personality rights in their marketing and merchandising. Courts have set some limits on the ability of third parties to use NCAA players’ personality rights, such as in video games, see In re NCAA Student-Athlete Name & Likeness Licensing Litigation, 724 F.3d 1268 (9th Cir. 2013), but the NCAA has held firm in prohibiting players from profiting off their own personality rights.

A group of current and former men’s football and basketball players filed an antitrust class action in 2009 against the NCAA, claiming that the organization’s amateurism rules are an unlawful restraint on trade. The district court conducted a bench trial in 2014 and ruled in favor of the plaintiffs. O’Bannon v. NCAA (“O’Bannon Trial“), 7 F.Supp.3d 955 (N.D. Cal. 2014). The court limited its ruling to the plaintiffs’ claims against “restrictions on the sharing of group licensing revenue,” id. at 1008, meaning that the NCAA can still enforce other aspects of its amateurism rules.
Continue reading

Published on:

In the spring of 2015, two new “live-streaming” apps, Periscope and Meerkat, became available to the public. These apps essentially allow users to create their own live broadcasts from their smartphones. Users have streamed live video of newsworthy events but also used the apps in ways that may violate copyright law. The apps have led to numerous “takedown notices” under the Digital Millennium Copyright Act (DMCA), but there have been no lawsuits so far. Controversies surrounding these apps also raise questions about whether an event itself, rather than a recording or broadcast of the event, is subject to copyright protection.

Meerkat was the first of the two apps, launching in February 2015. Periscope followed in March 2015. Two months earlier, in January, the social media service Twitter acquired Periscope from its founders for a reported seven- or eight-figure sum. Both apps have acquired millions of registered users, although Periscope has gained more publicity since its launch. Its direct connection to Twitter is almost certainly a factor in its prominence. Neither company maintains users’ video content on its servers for longer than one day, but other apps allow people to “capture” streams as digital video files.

The first copyright issue to arise in connection with live streaming occurred in April 2015, when the premium cable network HBO began sending DMCA takedown notices to Periscope. Users were allegedly streaming episodes of the HBO show Game of Thrones by holding their phones up to their television screens. Television episodes are undoubtedly copyrighted material, and it seems beyond dispute that streaming an episode online without HBO’s permission constitutes copyright infringement. Other controversial types of streaming, however, do not offer such clear answers.
Continue reading

Published on:

A Florida-based company shut down its major business operations in late April 2015 as part of a settlement in a lawsuit alleging more than 4,900 infringed copyrights. UMG Recording, et al. v. Escape Media Group, Inc., et al., No. 1:11-cv-08407, complaint (S.D.N.Y., Nov. 18, 2011). The defendant had operated a digital music service that claimed to offer access to “any song in the world.” Id. at 1. The case is reminiscent of the lawsuits brought more than a decade ago against individuals who allegedly downloaded songs through file-sharing services like Napster, except that this lawsuit targeted the company and its individual officers and employees, who allegedly made copyrighted materials available without licenses.

According to the complaint filed in November 2011, the defendant operated a website called Grooveshark, which it claimed had “a catalog of 15 million sound recordings available on demand.” Id. The plaintiffs owned the copyrights to many of the recordings allegedly included in the defendant’s catalog. They alleged that the defendant did not obtain licenses to use or distribute any of these recordings. They further claimed that the defendant openly acknowledged that its use of these recordings was unauthorized, and that its senior director stated that the company had never paid for licenses.

The defendant reportedly required employees and officers to personally upload recordings to the online database, and paid bonuses if someone’s number of uploads exceeded their assigned quota. The plaintiffs alleged that the defendant’s CEO, for example, was personally responsible for uploading at least 1,791 recordings. Once uploaded, a recording became available to the website’s users. The site had millions of visitors every month, which generated revenue through advertisements, subscriptions, and venture capital investments.
Continue reading

Published on:

An eBook retailer did not commit copyright infringement, a judge ruled late last year, when it published information about software that can be used to strip digital rights management (DRM) from eBooks purchased through its online store. The dispute originated with an antitrust lawsuit filed by the retailer against numerous publishers, Abbey House Media, Inc. v. Apple, Inc., et al, No. 1:14-cv-02000, complaint (S.D.N.Y., Mar. 21, 2014). Two defendants filed counterclaims for copyright infringement, based on the plaintiff’s notice to its customers. The Digital Millennium Copyright Act (DMCA) generally prohibits removal or circumvention of copyright protection technology. 17 U.S.C. § 1201. The court held that the uses made possible by DRM removal in this case, however, were all non-infringing, and that the plaintiff therefore was not liable for infringement.

The plaintiff operated an online eBook retail store called BooksOnBoard from 2006 until 2013. It had contracts with numerous publishers to sell digital versions of their books, but it closed the online store in 2013. The company’s owner said at the time that his company was “collateral damage in the publishers’ war against Amazon,” referring to the dispute over “agency pricing” between publishers and both large and small online retailers. He stated that the publishers’ new pricing models made it impossible for him to compete with the giant online retailers like Amazon, Barnes & Noble, and Apple.

Contracts between Abbey House and several publishers required the eBooks it sold to have DRM technology. DRM is a system of copyright protection intended to prevent theft or piracy. In practice, it sometimes prevents a user from transferring a digital music track, movie, or eBook from one device to another. Some DRM systems prevent users from accessing files on unapproved devices. A file purchased through one company’s store, for example, might only be accessible with that company’s hardware. If that company stops supporting that type of hardware, the user risks losing the media they legally purchased. This makes a user’s “purchase” of a song, film, or book seem more like a lease.
Continue reading

Published on:

A California business, alleging that a Facebook page infringed its trademark, sent a takedown notice under the Digital Millennium Copyright Act (DMCA) to Facebook. It then filed suit in federal court against the blogger who created and maintained the page. The blogger filed a counterclaim, alleging in part that the use of a DMCA takedown notice in a trademark claim was materially false, and that the business was therefore liable for damages. A federal judge ruled earlier this year that the blogger had stated a plausible claim and denied the plaintiff’s motion to dismiss that part of the counterclaim. CrossFit, Inc. v. Alvies, No. 4:13-cv-03771, order (N.D. Cal., Jan. 22, 2014).

The plaintiff has developed a well-known fitness program, CrossFit, which includes exercise routines and a certification program for personal trainers. It has registered the word mark CROSSFIT with the U.S. Patent and Trademark Office, and it has filed “intent-to-use” applications for possible future uses of the mark, such as books, apparel and accessories, and computer software. The defendant, described by the court as a “stay-at-home mother of four children,” id. at 2, started a blog using the URL “crossfitmamas.blogspot.com” and a Facebook page called “CrossFit Mamas.” She posted daily workouts on the blog, and readers posted their progress in the comments. The blog potentially generated revenue from sales of nutritional products on the site and Google AdWords advertising.

A representative of the plaintiff contacted the defendant in May 2013 to demand that she stop using the CrossFit name. The plaintiff moved her blog to the domain “calfitmamas.blogspot.com,” but the plaintiff allegedly continued to make demands, including the removal of the AdWords account and the deletion of blog posts covering a two-year period. At some point after the plaintiff first contacted the defendant, it sent a DMCA takedown notice to Facebook requesting removal of the plaintiff’s page.
Continue reading

Published on:

A lawsuit pitting two of the world’s most famous typeface designers against each other has brought a great deal of attention to an often obscure area of design. Choosing the right typeface has been an important part of marketing one’s business for about as long as printing has existed. Thanks to the internet and advances in digital technology, popular typefaces may generate millions of dollars in licensing fees. The parties in Frere-Jones v. Hoefler, No. 650139/2014, complaint (NY Sup. Ct., NY Co., Jan. 16, 2014), are considered superstars among typeface designers. The plaintiff is seeking $20 million in damages over an allegedly broken promise to share the business 50/50, and many valuable typefaces hang in the balance.

The words “typeface” or “font” refer to a set of symbols, including letters, numbers, and punctuation, with common design elements. Many well-known typefaces, such as Arial and Courier, are included with many computers and software applications. Typefaces are also available to license for use in marketing and other business publications. Licensing fees allow designers the opportunity to continue making money from their creations in much the same way that musicians receive income through royalty payments. Businesses may also commission typefaces for their own exclusive use. Copyright law generally protects typefaces, although trademark law may cover a specific use of a typeface in a logo or other design.

The plaintiff, Tobias Frere-Jones, claims in his complaint that he has designed more than eight hundred fonts during his career, which are used all over the world in more than 145 languages. The defendant, Jonathan Hoefler, is the founder of a New York design firm known as The Hoefler Type Foundry (HTF), which did business under the name Hoefler & Frere-Jones from 1999 until recently. Their firm has created fonts for newspapers like the Wall Street Journal, Barack Obama’s 2008 presidential campaign, and countless logos appearing on televisions, product packaging, and elsewhere. According to a description of the company in Bloomberg Businessweek, the two designers are like rock stars in the design world, with one colleague comparing their business partnership to the musical group Crosby, Stills, Nash & Young.
Continue reading

Published on:

The Ninth Circuit Court of Appeals recently granted a preliminary injunction that could have far-reaching implications for California businesses. The plaintiff, who is an actress, filed a copyright infringement lawsuit alleging that a filmmaker used footage of her in a movie without her permission. Garcia v. Google, Inc., et al (Garcia I), No. 2:12-cv-08315, complaint (C.D. Cal., Sep. 26, 2012). She sought a preliminary injunction requiring Google and YouTube to remove the movie from its servers. The Ninth Circuit found that she met the legal requirements for an injunction and reversed the district court’s denial of her request. Garcia v. Google, Inc., et al (Garcia II), No. 12-57302, slip op. (9th Cir., Feb. 26, 2014).

According to the plaintiff’s complaint, she agreed to appear in a low-budget historical action film entitled Desert Warrior, but the filmmakers used her footage in a different film, entitled The Innocence of Muslims, without her permission. The film has been widely, sometimes violently, criticized as anti-Muslim propaganda. In the English-language version of the film, the plaintiff’s character appears to accuse Mohammed of being a “child molester,” but the plaintiff claims that she never said these words and the dialogue was dubbed over what she actually said. Garcia I at 4. The plaintiff and her family have allegedly received multiple death threats because of the film.

The plaintiff claims that she never signed a release authorizing the filmmakers to use her footage in a different project, and that she therefore owns a copyright in her performance. She has a pending application to register the footage with the U.S. Copyright Office. After sending multiple “takedown notices” under the Digital Millennium Copyright Act to Google and YouTube, she filed suit. She is claiming direct and indirect copyright infringement against all defendants, as well as fraud and other claims against the filmmakers.
Continue reading

Published on:

Given the large concentration of technology companies in the Bay Area and the high turnover rate of employees in the start-up and technology business world, trade-secrets theft is a large concern amongst businesses in the Bay Area. Indeed, a recent report and court case reveal that this concern is justified. According to a global survey conducted by the computer security company, Symantec, half of employees who left or lost their jobs in 2012 kept confidential corporate data. Additionally, 40% of the individuals surveyed planned to use the data in their new jobs. Perhaps even more concerning is the fact that only 47% of those surveyed said that their organization took action when employees took sensitive information contrary to public policy.

Additionally, in October 2012, San Francisco-based online social gaming company, Zynga, Inc., sued its former employee, Alan Patmore, accusing him of taking company files when he joined Zynga competitor, Kixeye. More specifically, Zynga alleged that Patmore stored more than 760 documents from his work computer on the cloud storage website site, Dropbox, before his last day. The files taken included documents containing revenue information, monetization for its games, design documents for over 10 unreleased games, and 14 months of confidential emails. In Zynga’s original complaint, the company alleged that the data Patmore took could be used to ultimately improve Kixeye’s market standing. A September 9, 2013 filing at the San Francisco Superior Court revealed that Zynga and Patmore had settled their trade-secrets misappropriation case.

Patmore, who was the general manager of one Zynga’s most popular games, Cityville, before he was poached to become Vice President of product of Kixeye in September 2012, signed a Confidentiality Agreement pursuant to his employment with Zynga. The Confidentiality Agreement obligated him to protect Zynga’s confidential, proprietary, and trade secret information. Following the settlement, Patmore ultimately admitted to stealing trade secrets and issued an apology. Although the commercial terms of the settlement were not disclosed, Zynga had originally asked the court for both damages and injunctive relief, preventing Patmore and others from retaining, possessing, and disclosing any of its confidential and protected data.
Continue reading

Published on:

While California is currently the fourth largest oil-producing state, there is still untapped oil within the state. Oil companies hope to retrieve an additional estimated 15.4 billion barrels of oil in the Monterey Shale (which covers areas of Kern County, Orange County, Ventura County, Monterey and Santa Barbara County, California) through hydraulic fracturing.

Hydraulic fracturing, or fracking, is the process where a large amount of water is mixed with sand and chemicals, and then injected deep underground into rock formation, fracturing the geologic formations to release petroleum, natural gas, or other substances for extraction. While the increased use of fracking has the potential to lead to billions of barrels of oils being accessed, millions of jobs, and huge contributions to the domestic energy supply, there are potential health and environmental risks associated with fracking methods.

More specifically, during the fracking process, billions of gallons of water are mixed with various chemicals, many of which are known cancer-causing agents, and kidney, liver, neurologic and respiratory toxins. In addition, although fracking generally consumes less water than farming or residential uses, fracking is also increasing competition for water, increasing the price of water, and burdening already drought-ridden areas. Finally, California’s fracking industry could result in irreversible surface and groundwater contamination.

Up until now, the industry has refused to provide the names of many of the agents used under the guise of trade secret law, arguing that its commercial interests will be damaged if secrets are revealed. However, to combat some of the aforementioned risks and provide some oversight to the fracking process, 14 states, including California, are demanding that companies disclose the chemicals used during the fracking process. States hope that these regulations will allow the government to evaluate the environment and health impacts of fracking.

On May 29, 2013, the California Senate passed SB 4. The bill then moved to the California Assembly where it was further amended. If passed, the bill will require companies in California to disclose the names and concentrations of chemicals to state regulators in an attempt to bring transparency to the fracking process. In addition to requiring the disclosures of the fluids used during the fracking process, SB 4 would also require a fracking-specific permit and notice to property owners.
Continue reading

Published on:

The California Legislature is considering various bills relating to privacy that may have far-reaching impacts on California businesses. Some noteworthy bills currently pending include the following:

AB 242: Privacy Policy 100 Words

On February 6, 2013, California Assembly Member Ed Chau introduced legislation that would require commercial websites or online services that collect personally identifiable information to make their privacy policies easier to read. Two ways the bill hopes to achieve this goal is by mandating that the privacy policies be 100 words maximum and written at no greater than an 8th grade reading level. The bill sponsors hope that this will prevent companies from putting legalese into their privacy policies.

AB 319: Websites and online services-Minors

AB 319, introduced by Assembly Member Nora Campos on February 12, 2013, will require website and online service operators that have actual knowledge that they are collecting personal information from minors to provide notice on the website of what information they are collecting from minors and how the operator uses the information. The bill will also require the website operator to provide specific information to the parent of a minor that has provided the personal information to the website and to give the parent an opportunity to refuse to permit the operator’s further use or future collection of personal information from the minor. Essentially, the bill would make it so that any website that collects any information about anyone under the age of 18 would be required under California law to reveal that personal information to parents if requested.

AB 370: Online Tracking Transparency

AB 370 would require website operators to have privacy policies that disclose whether or not they are honoring a consumer’s requests to disable online tracking of the individual consumer who uses or visits the commercial website or online service. The bill would also require website operators to disclose whether they have prevented or allowed third parties to use online tracking.

AB 1291: Information-sharing disclosures: “Shine the light”

If passed, AB 1291, also known as The Right to Know Act of 2013 would let consumers find out who has their personal data, and would also allow consumers to get a copy of it. More specifically, AB 1219 would require a company to give users access to the personal data that the company has stored on them when a user requests it within 30 days of the request. The bill would also mandate a company to disclose a list of all third parties with whom it has shared the consumer’s data during the previous 12 months, the contact information of such third parties, and the types of personal information that was shared. The law would cover California residents and would apply to both brick and mortar and online companies. If a company does not comply with the requirements, AB 1291 grants California residents the right to file a civil lawsuit to force compliance.

The Right to Know Act hopes to increase transparency by allowing users to track the flow of their data from online interactions. The bill was written to ensure that California companies of all sizes will be able to tell Californians how they are collecting and sharing a consumer’s personal data.
Continue reading

Contact Information