March 10, 2006
Ninth Circuit Affirms in Part, Reverses in Part, Summary Judgment in LaHaye Lawsuit Against Movie Company for Breaches of Contract, Implied Covenant of Good Faith, Fair Dealing
The U. S. Ninth Circuit has reversed in part and affirmed in part the district court in LaHaye v. Goodneuz Group d/b/a Namesake Entertainment, in a lawsuit over whether Goodneuz should have released the film version of LaHaye's book to theaters before its video release, among other claims. The district court had granted summary judgment for Goodneuz on both a breach of contract claim and a breach of implied covenant of good faith and fair dealing claim.
With regard to the contract claim, the majority stated, "We reverse the district court's grant of summary judgment on LaHaye's claim that Goodneuz breached its obligations under ¶ 18 of the parties' contract when it refused to enter into negotiations for a long-form agreement. We view the facts in the light most favorable to the party opposing the motion for summary judgment, and we find a genuine issue of material fact as to whether Goodneuz breached the agreement....Here... the nature and extent of the obligation imposed by ¶ 18 are ambiguous. Neither the language of the contract, nor the circumstances under which the parties contracted, illuminates the conditions under which a long-form agreement would be "needed.""
The majority found that "the circumstances surrounding the making of the contract raise a material question as to whether the video-first distribution strategy breached the implied covenant. LaHaye presents fact that, taken in the light most favorable to him, suggest that in the event the option was exercised and a film was produced, the parties intended and expected the contract to require distribution initially in theaters. Moreover, making all inferences in favor of LaHaye, there is a material question of fact as to whether a theater-first release of a film is so integral to film distribution that is was understandable not to include an express contractual term requiring a theater-first release, and whether the producers could have in good faith chosen to distribute the film initially on video....We affirm the district court's grant of summary judgment on LaHaye's remaining claims for declaratory relief. Because the contract contemplates the possibility that the final budget might not exceed $10 million, there is no question that the contract did not require a minimum budget of some $30 to $40 million. Because the contract contemplates the possibility that the producers could exercise the option as late as April 14, 2000, there is no triable issue as to whether the producers were required to release the film by January 1, 2000."
The case is Tim LaHaye v. Goodneuz Group LLC, d/b/a Namesake Entertainment; Cloud Ten Pictures, Inc., 04-55839 (unpublished). It is available through both LEXIS and WESTLAW.
March 9, 2006
Yemeni Newspaper Editor May Face Death Penalty
Muhammad al-Asadi, the editor of the newspaper Yemen Observer, which republished the controversial Danish cartoons featuring the Prophet Muhammed, is facing criminal charges over the publication. The newspaper has lost its license to publish, and prosecutors are attempting to invoke the death penalty if al-Asadi is convicted on charges that he offended Islam. Read more here and here.
March 8, 2006
Writers Guild Parodies Product Placement
Check out the Writers Guild of America, West's parody of product placement at its website here. The WGA West intends the parody to be the next step in calling attention to the trend of integrating advertisers' products into television episodes and movies. Read more here.
Eliot Spitzer Files New Civil Suit Over Payola
New York's Attorney General, Eliot Spitzer, has filed a civil suit against Entercom Communications Corporation, alleging that it forces companies and promoters to trade payments of various kinds for air time. Entercom denies the allegations. Read more here. Last year, Spitzer and Sony BMG settled a civil suit over "pay for play" for $10 million. Read more here.
Questioning Continues in Da Vinci Code Lawsuit
The questioning of Holy Blood, Holy Grail co-author Michael Baigent continued yesterday in the lawsuit that Baigent and Richard Leigh have brought against their own publisher Random House over Dan Brown's alleged use of material in the book in his work The Da Vinci Code. Random House's attorney obtained Baigent's admission that he "had exaggerated" when he said Brown improperly used material from HBHG. Baigent said he had relied on book reviews to support his position. "I think my language was infelicitous, and I think I have to agree with you on that." When the judge asked him why he was retracting so much of a statement he had made so recently he said, "It means I did not read them [book reviews] with the correct assiduity as I should have done." Read more here, here, and here.
March 7, 2006
Simeoni Defamation Lawsuit Against Lance Armstrong Begins
Filippo Simeoni's third lawsuit against Tour de France champion Lance Armstrong has begun, this time in a court near Rome. Read more here.
Canadian Trademark and Internet Law
Vincent-Joel Proulx has published "Borrowing From Our Common-Law Cousins: American and British Influences on the Merger of Canadian Trademark and Internet Domain Name Laws," in volume 22 of the Arizona Journal of International and Comparative Law. Here is the abstract.
This article posits that Canadian trademark law is sufficiently circumscribed to regulate the realm of Internet domain names. The overarching purpose of its thesis aims to identify an inherent compatibility between Canadian trademark law and the Internet, while also clearly delineating the Canadian legal framework vis-a-vis domain names. In shedding light on this legal symbiosis, the article ventures upon a comparative study of Canadian, US, and UK jurisprudence, while also taking stock of certain arbitral structures such as ICANN, in order to highlight horizontal legal transplants that will have direct incidence on Canadian online business. Among the themes canvassed, particular emphasis is placed on the ever-increasing extraterritoriality of US law in this field, along with the acknowledgement that US judicial precedents wield considerable influence over Canadian intellectual property policy. As a corollary to this proposition, deference to transboundary domain name litigation and transnational law-derived considerations also pervade the discussion. The merging of Canadian trademark law and Internet domain name regulation is ultimately actuated through the extension of foundational trademark concepts, such as confusion and passing off, to the Internet, along with judicial pronouncements emanating from cognate common law jurisdictions, which are conflated into a single, overriding approach.
Download the entire paper from SSRN here.
A Paper on Cybertrespass
Shyamkrishna Balganesh, Yale Law School, Yale Information Society Project, has published "Common Law Property Metaphors on the Internet: The Real Problem With the Doctrine of Cybertrespass," through SSRN. Here is the abstract.
The doctrine of cybertrespass represents one of the most recent attempts by courts to apply concepts and principles from the real world to the virtual world of the Internet. A creation of state common law, the doctrine essentially involved extending the tort of trespass to chattels to the electronic world. Consequently, unauthorized electronic interferences are deemed trespassory intrusions and rendered actionable. The present paper aims to undertake a conceptual study of the evolution of the doctrine, examining the doctrinal modifications courts were required to make to mould the doctrine to meet the specificities of cyberspace. It then uses cybertrespass to examine the implications of transposing property metaphors to the world of the Internet, characterized by the absence of resource rivalry and the reality of positive value enhancement through increased usage (i.e., a network effect, whereby participation in use by many is a condition for value in use by any). It is argued that the transposition of proprietary concepts to the Internet is done for purely instrumental reasons - reasons that derive neither from the nature of the resource nor its usage. The paper then evaluates whether such an instrumental use of proprietary concepts on the Internet has any effect on the meaning ordinarily attributed to the concept of property and the identification of property as an independent institution of moral significance. It concludes by showing that the relative neglect that doctrines such as cybertrespass have for identifying the boundaries of the res over which the property right is to operate, is capable of undermining the minimum core of any understanding of property as an independent institution.
March 6, 2006
DRM and Fair Use
Timothy K. Armstrong, Harvard University - Berkman Center for Internet & Society, has released "Digital Rights Management and the Process of Fair Use" through the SSRN. Here is the abstract.
Producers of digital media works increasingly employ technological protection measures, commonly referred to as “digital rights management” (or “DRM”) technologies, that prevent the works from being accessed or used except upon conditions the producers themselves specify. These technologies have come under criticism for interfering with the rights users enjoy under copyright law, including the right to engage in fair uses of the DRM-protected works. Most DRM mechanisms are not engineered to include exceptions for fair use, and user circumvention of the DRM may violate the Digital Millennium Copyright Act even if the use for which the circumvention occurs is itself noninfringing.
The academic literature on fair use in digital media has suggested several possible ways to resolve the tension between fair use on the one hand and DRM on the other. Among the more provocative possibilities is that DRM technologies themselves may evolve to incorporate greater built-in protections for end-user rights. This article examines several such proposals and finds that they are not likely to provide users with the same measure of protections for fair use of copyrighted works that exists in the offline world. The failure of these proposals, however, does not suggest that the broader goal of protecting fair use rights in digital media is unattainable. It is possible to advance much more closely towards that goal by altering the design philosophy of DRM technologies to focus more on the processes by which fair uses occur and less on attempting to replicate the substantive law of fair use in machine-administrable form. The article concludes by outlining one possible system engineered to protect the process of fair use.
French Chefs and Copyright
Emmanuelle Fauchart, Conservatoire des Arts et Metiers (CNAM), and Eric A. von Hippel, Massachusetts Institute of Technology (MIT) - Sloan School of Management, have published "Norms-Based Intellectual Property Systems--The Case of French Chefs" as MIT-Sloan Research Paper #4576-06. Here is the abstract.
In this paper we propose that “norms-based” intellectual property systems exist and are an important complement to or substitute for law-based intellectual property systems. Norms-based IP systems operate on social norms that are held in common by members of a given community and specify the nature and extent of rights that a group member can assert to intellectual property. They also include procedures for the claiming of intellectual property rights, and community-accepted types of sanctions for violators.
We document the existence of a norms-based IP system among a sample of accomplished French chefs. These chefs consider recipes they develop to be a very valuable form of intellectual property. At the same time, recipes are not a form of innovation that is effectively covered by law-based intellectual property systems. Via grounded research, we identified three strong social norms related to the protection of recipe IP. Via quantitative research, we found that accomplished chefs do rely on these norms to enhance their economic returns from their recipe-related IP.
In our discussion, we compare the attributes of norms-based and law-based IP systems, arguing that each has different advantages and drawbacks. We also point out that the existence of norms-based IP systems means that the usage of information that is freely accessible and not legally protected may be nonetheless restricted to the benefit of innovators. Indeed, information “commons” may in fact be criss-crossed by norms-based fences, with access by those adhering to community norms controlled by IP owners.
The paper is also downloadable through the SSRN network here.
March 5, 2006
Justice Begins Investigation Into Music Download Pricing
The Guardian reports that the US Attorney General has begun an investigation into whether the major record labels are keeping the price of music downloads artificially--and illegally--above what the market would otherwise set. Sony BMG and three other record companies have apparently received subpoenas in conjunction with the matter. Eliot Spitzer, New York's Attorney General, started a similar investigation last year.