Earlier this week, Fernando Bohorquez and Alan Pate authored an article in iMediaConnection.com, “A guide to native advertising’s legal issues.” The article disentangles regulations applicable to native advertising and explains the general state of best practices. The article can be found here.
It was the ad video gone viral of three young girls proudly showing off their elaborate Rube Goldberg machine made of repurposed pink toys. They sang “it’s time to change, we deserve to see a range” and called for girls “to code the new apps” and “to grow up knowing that they can engineer that.” GoldieBlox is a toy company started by Debbie Sterling, an engineering graduate of Stanford who noticed how deeply girls are underrepresented in that field. Her startup company talks about “disrupting the pink aisle” and sells construction toys for girls.
How fitting, then, that they decided to borrow from the Beastie Boys’ 1987 song “Girls” to express this sentiment in their advertising. All the lyrics in the ad are set to the catchy tune of “Girls” but replace the original lyrics that called for girls “to do the dishes” and “to clean up my room” and other such tasks.
Reportedly, the Beastie Boys wrote a letter to Goldieblox about the ad saying the video constitutes copyright infringement. In a preemptive response, Goldieblox sued the Beastie Boys along with Island Def Jam Music Group, Rick Rubin and others in the Northern District of California seeking a declaratory judgment that their work does not infringe. They argued that the work is a clear criticism and parody of the original, and should thus be covered by the fair use doctrine. Their complaint calls the Beastie Boys’ version “highly sexist” and states that the “specific goal of the parody is to make fun of the Beastie Boys song, and to further the company’s goal to break down gender stereotypes and to encourage young girls to engage in activities that challenge their intellect.”
A discussion of the fair use defense in this context would likely center on the first of the four factors of the fair use defense found in 17 U.S.C § 107: “the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes.” Indeed, Goldieblox would likely have strong arguments that the purpose of the work is criticism and parody, looking to the Supreme Court decision in another parody song suit, Campbell v Acuff Rose Music, for guidance. There, 2 Live Crew’s rap version of Roy Orbison’s “Oh, Pretty Woman” was considered a fair use because it was a parody of the original. Despite the fact that there was a commercial element there, the Supreme Court found that “[t]he language of the statute makes clear that the commercial or nonprofit educational purpose of a work is only one element of the first factor enquiry into its purpose and character.”
However, there are arguments circling on the other side as well, that the purpose here is really not criticism, but selling a product. After all—this is not a commercial song, but a commercial advertisement. And perhaps there are even arguments about the nature of parody itself, given that there are questions whether the Beastie Boys’ song was ever to be taken seriously anyway. As put forth in an article in Salon, “[i]nstead of hiding behind the thoroughly lame excuse that ‘The song was sexist, ergo we can take it to sell our toys,’ GoldieBlox could instead put on its big girls pants and make something awesome now with its creative talent.”
GoldieBlox now appears to be backing down and endeavoring to do just that: focus instead on its products.
As reported here by Pitchfork, the two remaining members of the Beastie Boys, Adam Horovitz (“Ad-Rock”) and Michael Diamond (“Mike D”), responded to the suit with a letter. It noted that they were “very impressed with the creativity and the message behind your ad,” but indicated “as creative as it is, make no mistake, your video is an advertisement that is designed to sell a product, and long ago, we made a conscious decision not to permit our music and/or name to be used in product ads.”
On November 27, GoldieBlox issued an open letter to the Beastie Boys, saying that while they believe the work is a fair use, they want to respect the wishes of the late Beastie Boys’ member, Adam Yauch, whose will reflects his request that his music never be used in advertisements. They said they would remove the video, that they are “huge fans,” and that they didn’t know about Yauch’s wishes. It is nice to hear that this tale seems to heading toward a happy ending for the parties involved. Though it appears, then, that there may be no legal battle on the issue of fair use.
Until next time . . .
On November 15, Judge Chin of the Southern District of New York issued a long-awaited decision in the Google Books case, Authors Guild, Inc. v. Google Inc. Google Books—the project through which Google provides access to over twenty million books to the public—obtained some of its books from libraries without permission from the copyright owners. When a library allows its books to be scanned, Google provides full digital copies of those books to that library only. Books scanned from libraries that are not in the public domain can otherwise only be viewed by the public in “snippets,” or small, verbatim excerpts.
The plaintiffs originally filed their class action eight years ago alleging that Google’s scanning and digital display of books without permission infringed the owners’ copyrights. They alleged Google infringed by unauthorized reproduction (by scanning the books); unauthorized distribution (through the provision of full digital copies to the libraries); and unauthorized display (through the display of snippets of the books to the public). Judge Chin rejected an initial settlement agreement on the grounds that it was not a fair resolution of the class action, and the case continued with a fight over two issues: (1) whether the plaintiffs were certifiable as a class; and (2) whether Google’s actions were protected under the fair use doctrine. The Second Circuit concluded that resolving whether the fair use defense applied might inform or even moot the class certification issue, and it remanded the case to the Southern District on the issue of fair use.
Section 107 of the Copyright Act, identifies “criticism, comment, news reporting, teaching . . ., scholarship, or research” as purposes for which there is not an infringement of copyright, along with four factors to consider in this determination. Judge Chin found that Google’s use of the books “provides significant public benefits” by allowing readers and researchers to efficiently find books, advancing the progress of the arts and sciences and striking a balance between the rights of authors and other individuals. He also found that the ability for Google Books to facilitate search made it transformative use, just as thumbnail images to facilitate search had been found to be transformative by the Ninth Circuit. A summary of the discussion of each of the four factors is here:
- The Purpose and Character of the Use – Judge Chin found Google’s use to be transformative because digitization helps people find books and search their text, rather than a use for expressive purposes. The fact that Google is a commercial enterprise did not prevent this factor from weighing in favor of fair use because Google did not sell the scans or the snippets and did not run ads on the books’ information pages. This first factor weighed strongly in favor of fair use.
- The Nature of the Copyrighted Works – The fact that the vast majority of the works at issue were nonfiction and the fact that all of the works were published weighed in favor of fair use.
- Amount and Substantiality of the Portion Used – Although Google did scan the full text of the books, this factor weighed only slightly against a finding of fair use because scanning the entire book was necessary for Google’s search functionality and because Google limited the amount of text displayed through the use of snippets.
- Effect of Use Upon Potential Market or Value – This factor weighed strongly in favor of a finding of fair use because Judge Chin found that Google Books actually enhanced the market by increasing the audience for books.
Judge Chin’s broad approach to fair use may embolden companies whose public benefit lies in the use of technology for the betterment of society. Although, this story is not quite over yet—the Authors Guild has already announced its plan to appeal the decision. We’ll keep on reading, as the future of this case is sure to be a page-turner.
This past Friday, Starbucks received yet another blow in its 12-year long trademark dispute against Wolfe’s Borough Coffee Inc. The Second Circuit affirmed U.S. District Judge Laura Taylor Swain’s decision and found that Starbucks failed to prove that Wolfe Borough’s “Charbucks,” “Mister Charbucks,” and “Mr. Charbucks” marks were likely to dilute its brand. As such, the three-judge panel denied Starbucks’ request for an injunction against the family-owned, New Hampshire-based coffee company.
Under the Trademark Dilution Revision Act of 2006 (the controlling law in this case) courts are required to balance six factors to determine whether one mark is likely to dilute another: 1) the degree of similarity between the mark or trade name and the famous mark, 2) the degree of inherent or acquired distinctiveness of the famous mark, 3) the extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark, 4) the degree of recognition of the famous mark, 5) whether the user of the mark or trade name intended to create an association with the famous mark, and 6) any actual association between the mark or trade name and the famous mark. See § 1125(c)(2)(B). The TDRA factors are designed to determine whether one trademark is likely to confuse consumers by “blurring” the trademark of another brand.
The Second Circuit agreed with the District Court’s analysis, finding that the lack of an actual association between the Charbucks and Starbucks marks outweighed the distinctiveness, exclusive use, and high recognition of the Starbucks mark. The central issue here was whether consumers were likely to confuse Charbucks for Starbucks.
To help show consumer confusion, Starbucks commissioned a 600-person telephone survey. Consumers were asked: 1) What is the first thing that comes to your mind when you hear the name Charbucks, spelled C-H-A-R-B-U-C-K-S? and 2) Can you name any company or store that you think might offer a product called Charbucks? Although “[t]he number one association of the name ‘Charbucks’ in the minds of consumers is with the brand ‘Starbucks,’” the Second Circuit found that the District Court was correct to discount the survey. The survey only focused on consumer associations with the word “Charbucks” and not associations with the actual packaging of the Charbucks blends.
As reported by Law360, counsel for Wolfe’s Borough stated, “The Second Circuit recognized what we have long believed: Black Bear’s ‘Charbucks Blend’ and ‘Mr. Charbucks’ do not dilute any of Starbucks’ marks. This is an important trademark case, establishing that dilution by blurring is very difficult to prove when the marks are dissimilar and when the evidence of actual association between the marks is weak, as it was here.”
A representative from Starbucks commented, “We are respecting the court’s decision.”
Editor’s Note: This article was originally published as a BakerHostetler Executive Alert on November 13, 2013
A proposed U.S. Senate Bill has the potential to change the way in which intellectual property infringement is reported and enforced. U.S. Senate Bill 662 (“S. 662″), the Trade Facilitation and Trade Enforcement Reauthorization Act of 2013, has recently been the subject of lobbying efforts by the Chamber of Commerce and a number of businesses and trade groups eager for more stringent intellectual property protections. Introduced to the U.S. Senate on March 22, 2013, it has since been referred to the Senate Committee on Finance, which held a hearing on the bill in May but has not yet taken further action. The U.S. House of Representatives has introduced a related bill, H.R. 3004, the Reducing Waste and Increasing Efficiency in Trade Act, which was referred to the House Committee on Ways and Means in August 2013. Parties interested in moving S. 662 forward have written a letter to the bill’s co-sponsors, U.S. Senators Max Baucus of Montana and Orrin Hatch of Utah, urging Senate finance leaders to send the bill to the Senate floor this year for a vote.
S. 662 reauthorizes existing trade facilitation and enforcement functions, and adds new provisions designed to enhance cooperation on intellectual property protection between and among federal agencies, the private sector, and the international business community. Notably, the bill adds a provision amending the Tariff Act of 1930 that empowers the Commissioner of the U.S. Customs and Border Protection Agency (“Commissioner”) to provide copyright and trademark owners with information concerning infringements of their intellectual property rights. The provision gives the Commissioner the unprecedented ability to share actual samples and unredacted images of counterfeit goods, including packaging and label information, with copyright and trademark owners.
Another provision of S. 662 requires the Department of Homeland Security to develop and execute an educational campaign for travelers entering or leaving the United States about the legal, economic, and public health and safety implications of acquiring merchandise that infringes intellectual property rights. The bill also suggests that the Commissioner work with the U.S. Patent and Trademark Office to develop a system that allows for simultaneous recordation of trademarks and copyrights with both the U.S. Customs and the U.S. Patent and Trademark office. The authors of the letter in support of S. 662 acknowledge that the bill contains controversial measures regarding antidumping and countervailing duty enforcement, but urge the Senate Finance Committee to nevertheless work to move the bill forward. This is a bill to track in the final months of 2013.
If you have any questions about the material presented in this alert, please contact Heather J. McDonald at firstname.lastname@example.org or 212.589.4285 or your regular BakerHostetler contact.
After the Second Circuit ruling in Cariou v. Prince, which we wrote about on this blog here, photographer Patrick Cariou felt that the decision was too subjective, calling it an “I know it when I see it” approach for determining when a work is transformative—or, in other words, when a work that appropriates copyright material has the requisite “something new” so as to qualify for fair use protection under U.S. copyright law. Last week, the U.S. Supreme Court declined Cariou’s Petition for a review of the Second Circuit decision and the application of the copyright fair use standard.
The above artwork (resized), shows Prince’s Graduation (left) side by side with a photo from Cariou’s Yes Rasta. A decision on transformative use for Graduation was remanded back to district court.
The Second Circuit found that 25 out of 30 pieces of artwork from Richard Prince’s collection “Canal Zone” at the Gagosian Gallery—pieces that appropriate varying degrees of elements from Cariou’s “Yes, Rasta” photograph collection—met the test for fair use. The other five were sent back to the district court for a determination there. A partial dissent questioned whether the appellate court should have opined on the transformative nature of a work without expert opinions or the opportunity for further evidence. It also questioned whether the lack of Prince’s own explanation as to a transformative purpose to his work should have been disregarded.
The continued battle in the petition briefs reflect the main arguments about fair use generally—on the one side, that it is too giving, leaving copyright holders open to rampant use of their works, and leaving online photos and images particularly vulnerable. And, on the other side, it is not giving enough, squelching free expression particularly where an artist speaks with a language using what came before it – copyrighted or not.
Fair use is a four-part test found in 17 U.S.C. 107. “Transformative use” is part of the discussion of the first factor: “the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes.” The seminal case on transformative use is Campbell v. Acuff Rose Music, Inc. which involved a musical parody that was deemed a fair use. Incorporating some of the points from the Cariou v Prince dissent, Cariou argued that the Second Circuit extended the application of Campbell. They argued that Campbell does not require a determination of whether it can “reasonably be perceived” that a work is transformative unless the defendant has explained and defended his purpose as transformative.
Among other arguments, Cariou also put forth that the Second Circuit did not weigh the four fair use factors correctly, and did not focus enough on the third factor, the substantiality of the copying. He argued, further, that there was a circuit split in the Second Circuit’s use of the fourth factor—the effect of the use upon the potential market for the copyrighted work. He claimed that the Second Circuit’s emphasis on the fact that Cariou had not aggressively marketed his work “overlooks the statutory focus on potential markets and conflicts with decisions of other circuits.”
Prince responded that the Second Circuit properly applied Campbell and did not create a circuit split in its treatment of the fourth fair use factor because it concluded that Cariou would not “develop or license secondary uses in the vein of Prince’s artworks.”
Both sides received considerable support from interested parties throughout the life of the case. As Cariou v. Prince now reaches the end of this appeal, for now, appropriation artists and other supporters of Richard Prince appear to have carried the day.
Editor’s Note: This blog post was originally published on September 11, 2013, courtesy of iMedia Connection’s Blog. It is repurposed with permission.
On June 3, 2013, we wrote about the new COPPA requirements coming into effect starting July 1, including a variety of requirements intended to keep up with advances in technology and how children interact with mobile apps and websites. These have now come into effect, and I’ve provided a more expanded discussion of these issues here in Bloomberg BNA Social Media & Policy Report.
Following up on my recent post discussing copyright dispute surrounding Robin Thicke’s hit single ‘Blurred Lines,’ I had the opportunity to speak with Colin O’Keefe of LXBN on the story. In the interview, I explain the background of the suit and how these types of issues are normally decided.
Although the sale of its Navajo product line constituted “personal and advertising injury” within the meaning of its liability insurance policies, Urban Outfitters was not entitled to defense or indemnity for claims brought by the Navajo Nation Indian tribe because of the policies’ “prior publication” or “first publication” exclusions. Hanover Insurance Co. v. Urban Outfitters, 2:12-cv-03961-TON (E.D. PA. August 19, 2013).
Pursuant to an agreement with a fronting insurer, Hanover Insurance Co. (Hanover) was responsible for primary and umbrella liability coverage issued to Urban Outfitters for a one year period commencing on July 7, 2010. Hanover then issued primary and umbrella coverage for the following year. All policies provided coverage for a “personal and advertising injury” offense committed “during the policy period.”
“Personal and advertising injury” was defined as injury arising out of:
Oral or written publication, in any manner, of material…that disparages a person’s or organization’s goods, products or services. This does not include any disparagement related to the actual or alleged infringement or violation of any intellectual property rights or laws; Oral or written publication, in any manner, of material that violates a person’s right of privacy; The use of another’s advertising idea in your ‘advertisement;” or Infringement upon another’s copyright, trade dress or slogan in your ‘advertisement’.” The primary and umbrella policies contained “prior publication” or “first publication” exclusions, which preclude coverage for personal and advertising injury “arising out of oral or written publication of material whose first publication took place before the beginning of the policy period.
(collectively, the Prior Publication exclusions).
Beginning at least by March 2009, Urban Outfitters advertised and sold goods under the Navaho and Navajo names. The Navajo tribe sued Urban Outfitters, alleging that its display and sale of Navajo goods in its stores and online falsely suggested that they were products of the Navajo Nation. The Navajo Nation alleged that Urban Outfitters thereby infringed on the Navajo Nation’s trademarks.
Hanover defended Urban Outfitters under a reservation of rights. Hanover then filed a declaratory judgment action in the U.S. District Court in the Eastern District of Pennsylvania, seeking a ruling that it had no duty to defend or indemnify Urban Outfitters because of the Prior Publications exclusions.
Ruling on Hanover’s motion on the pleadings, the court held that the Navajo Nation’s claims against Urban Outfitters “clearly” alleged “personal and advertising injury” under the policies. However, the court held that the Prior Publication exclusions applied because Urban Outfitters started using the “Navajo” and “Navaho” names in its product line at least since March 2009. Noting that “Navajo” had been trademarked by the Navajo Nation, the court held that Urban Outfitter’s use of the trademark “allegedly falsely suggests Urban Outfitters products are Indian products of the Navajo Nation….when in fact they are not.”
The court’s decision was not affected by the fact that Urban Outfitters advertised additional allegedly infringing products at a later date. “Unless later publications contained ‘new matter’ – i.e. substantively different content – that the underlying complaint alleged were fresh wrongs,’ the ‘prior publication’ exclusion applies.” Because the purpose of insurance is to spread risk, “if the risk has already materialized, what is there to insure? The risk has become a certainty.” (internal citations omitted).
The court ruled that the advertising injury was identical, even though additional products were being advertised at a later date. “Other products that alleged violate the Navajo Nation’s trademark on the word ‘Navajo’ by using that term …. may cause separate injuries, but they infringe upon the same trademarked work and thus cause advertising injury to the Navajo Nation in the same way.”