Business IP Lawyer

The Librarian of Congress has added “Jailbreaking” onto the list of items that are permissible. “Jailbreaking” is the process of hacking into an iPhone’s operating system to allow the phone to run any application, not just those approved by Apple. The Digital Millenium Copyright Act forbids circumventing encryption technology to copy or modify copyrighted works and provides for certain exemptions to copyright infringement. In addition, the DMCA gives the Librarian of Congress the authority to issue exemptions from the prohibition against circumvention of access-control technology. The Electronic Frontier Foundation asked the Librarian of Congress to add “Jailbreaking” to the list of permissible acts. After nineteen months, the Librarian of Congress complied. This decision will allow users gain access to more markets for mobile phone apps. I myself don’t know too much about jailbreaking or the iPhone since I have a Blackberry (which in my opinion doesn’t run apps well).

Kevin

Copyrights are intellectual property. As such, they can be used just the same as property- namely as security for a loan. A recent example of this was last year when Annie Leibovitz, the famous photographer, borrowed $15.5 milliion dollars and used all of her copyrights as collateral. The story can be seen here at the NYTimes. That means that if she doesn’t pay back the money, then the lender can “reposses” the copyrights to her works. This doesn’t mean that if she defaults the lender gets the physical pictures. Rather this means that if she defaults, the lender gets the rights to the pictures, gets to collect royalties from them, and gets to sue others for infringing her works. If you own intellectual property and don’t know what to do with it, this is just one example of how to make it work for your business.

Kevin

Find yourself hearing different version of the same songs playing on the radio?  Well in the case of Destiny’s Child’s 2004 song “Cater 2 U”, Ricky Allen claimed that he was the original author of the song and he sued Destiny’s Child for copyright infringement.
Claims were made by Rickey Allen that a copy of the song was handed to the Destiny’s Child producer. The producer maintains that he never has had a copy of the song.

The Destiny’s Child stars were set to make court appearances in December but instead settled the claim of copyright infringement through their respective intellectual property attorneys.

The Internet has shaped and reshaped all areas of modern life, and the law is no exception. Cloud computing, one of the latest internet-related trends is no different. Cloud computing is a phrase as nebulous as the weather formation to which it refers.  The term broadly refers to internet based computing and technology development, but it can encompass activities ranging from editing a document through Google docs to splicing and dispersing data over multiple servers through software such as that provided by Cleversafe.  As the paradigm is still evolving, multiple companies have defined the term in a variety of ways, usually in broad and vague terms. For example, the National Institute of Standards and Technology says:  “[c]loud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources.”  

One of the primary applications, and greatest opportunities, of cloud computing is for providing software as a service, otherwise known as SaaS.   SaaS refers to a provider licensing a software application to customers on demand. In the past, software has been treated as a product. If you wanted software, you had to buy a physical CD. This process has lead to complicated licensing agreements by software companies in an effort to control the unauthorized use of the software. One solution that software companies have used to counter unauthorized use has been to require the CD to be in the computer for the software to work. A better solution has been to require a separate licensing fee for each computer the software is installed on. However, there is still the problem of an unused CD floating around that someone will eventually get their hands on and start using without paying a fee for. This represents lost revenue to the software developer and has indirectly contributed to what some see as inordinately high licensing fees.

For SaaS, instead of treating software as a product, software is treated as a service.  Instead of CDs and copying the software onto each device that uses it, the developer maintains the software on its own servers and sells monthly access to the software. Instead of selling copies, developers sell access. This results in tighter control of unauthorized use since each person who uses the software must have a specific user ID and password.

Cloud computing can be very beneficial from a client perspective. The dispersal of information for storage is extremely efficient. Also, SaaS can provide a solution for small businesses that do not have the resources to deal with the expenses and complexity of equipping every device with applications that are not needed for use all the time. From the developer perspective, SaaS can also be seen as a more viable business model because of benefits over the CD method of distribution- (1) it provides stable monthly revenue that can assist small developers with meeting cash flow needs; (2) the total fees that a developer realizes can be greater, especially when customer inertia is taken into account (the fact that once customers start using the service they will be less likely to drop it); and (3) it provides developers with important ongoing client information that they can utilize in business decisions.

Even though the model may be moving to the cloud, certain legal issues are still arising. On the client side, sending and storing information on another party’s servers could result in loss of data or seen as a disclosure of trade secrets. On the developer side, misusing client information could open up the possibility of liability. Also, developers could be contributorily liable for any infringements that occur if clients misuse the software. This could occur if the software allows users to interact and share files. The developer may be entitled to protection under the DMCA, but only if it sets up and follows the system specified by law.

The silver lining in the clouds is the licensing agreement. Many of these issues and risks can be properly handled and mitigated in a correctly drafted terms of use. A well-drafted licensing agreement would solve future dilemmas that could lead to complex and expensive litigation. Consulting an IP attorney will be essential to avoid pitfalls in the license agreement.

Kevin Keener

Who wouldn’t want to own the most popular bear in the world along with all of his friends that live in the Hundred Acre Woods? Well it seems that a widow and Disney both believed that Winnie the Pooh was theirs.

Last fall, a judge in California ended a copyright infringement claim against Disney brought by the Slesinger family. Stephan Slesinger had bought the copyright to Pooh in 1930 from the British creator, A.A. Milne. After Stephan Slesinger passed away his widow licensed the copyright to Winnie the Pooh to Disney in return for regular copyright royalties. By licensing these rights she gave up ownership to Disney in exchange for a ‘regular royalties’. The Slesinger family accused Disney of breach of contract  for failing to disclose accurate royalty figures. Judge Marie Cooper found misconduct on part of the Slesinger family and in the end it was concluded that “Stephan Slesinger transferred the all of its rights in the Pooh works to Disney, and may not now claim infringement of any retained rights.”

This just blows the mind. The Font Bureau filed a lawsuit against NBC for copyright infringement. According to the complaint, NBC used typeface owned by The Font Bureau to create the marketing materials for The Jay Leno Show and Saturday Night Live.  NBC is allegedly going beyond its copyright licensing agreement and The Font Bureau is claiming over $2 million in damages.

Kevin Keener

The issue of Harry Potter and the Chamber of Lawyers- where Warner Bros. sent a cease and desist letter to a person planning a Harry Potter costume party- raises the possibility of getting sued if you make your own costume.

Every year you can find thousands of costumes based on movie characters and cartoon characters. Copyright attorneys will tell you that in a very literal sense these costumes are derivative works of the original, requiring those who make them to first obtain a copyright license from the owners. Making your own costume for Halloween should be fair use of a copyright. However, no use is fair use until a judge says it is. That means that you have to get to trial first. The process of getting there is very costly. The Warner Bros cease and desist letter means that the company is taking an aggressive stance with protecting its copyrights- much like the music industry did. Does this mean that you could get slapped with a suit for copyright infringement if you made your own costume and didn’t buy one from an approved licensor? It is possible but because it is for an uncommercial use it is likely to be protected under a fair use defense. However, as an intellectual property attorney for a copyright owner, I would argue that dressing up for free candy is a commercial use, especially under the Supreme Court’s definition of income (Accession to wealth over which the person has complete dominion and control). If there is anything that I know about my four year old son and candy, it’s that candy is wealth and he has complete dominion and control over his candy. Don’t you dare touch it!

Kevin Keener

Talk about one hot suit for trademark infringement. Walker & Sons makes a Cajun seasoning called “Slap Ya Mama.” Walker & Sons filed a trademark registation for the name in 2008 after it had been using the name for ten years. Now there is a start-up companymaking a Cajun seasoning called “Punch Ya Daddy.” Walker & Sons filed suit in Louisiana state court and the case was just transferred to federal court. This is the type of spicy case that any number of trademark attorneys would love to sink their teeth into. This Chicago intellectual property attorney loves hot food but doesn’t get down to New Orleans enough.

Kevin Keener

A court ruled recently that a man did not engage in copyright infringement when he sold copies of AutoCAD on Ebay. Vernor had obtained copies of legally purchased AutoCAD disks to sell on Ebay. Autodesk, the company that designed AutoCAD, let loose its copyright attorneys, invoked the takedown provisions of the Digital Millenium Copyright Act, and persuaded Ebay to remove the posts. In addition, Ebay barred Vernor from selling for one month.

The court ruled on summary judgment in favor of Vernor. The court focused on the distinction between the ownership of the physical CDs themselves and the ownership of the copyright of the software on those CDs. Because of a rare set of facts, it turned out that Vernor was the owner of the physical CDs and that his resale was permitted under the first sale doctrine.

The case is Vernor v. Autodesk, Inc., No. C07-1189RAJ (W.D. Wash., Sept. 30, 2009).

Kevin Keener

A federal judge for the Southern District of New York has ruled that cell phone ringtones do not constitute a public performance and that mobile phone users do not need to pay a royalty for the public performance of songs when their phones ring. The judge ruled that the playing of music when the phone rings is done without commercial purpose. This ruling brings ringtones directly into the exemption for liability under section 110(4) of the copyright act. The judge ruled that this section applied because cell phones are not the sources of commercial public entertainment.

A couple of notes- I completely disagree with the judge. First, listening to people’s cell phones is completely public entertainment, and just because people don’t charge doesn’t mean that they shouldn’t. Second, as a reason of public policy, there should be an extra charge for ringtones, if only as a deterrent from having people pick those really annoying ones (I’m talking to you, person with “The Final Countdown” on his blackberry). I really think those people should be liable for copyright infringement, and that’s not based on my opinion as a Chicago copyright attorney, but on my opinion as someone who has to listen to that on annoying song on a crowded Brown Line train. End of rant.

Kevin Keener