by Lee Gesmer | Jun 19, 2012 | Copyright
Tetris. Popular? Perhaps the best video game yet created, with over 200 million copies sold. Mysterious? It was developed by a Russian programmer during the cold war. Scientific? Think tetrominos, not MMOGs. If you aren’t familiar with this game you should (a) reexamine your life, and (b) check it out.
But does copyright law protect it against a knock-off that uses not only the same “ideas” (tetromino shaped tiles falling from the top of the screen, that need to be moved/rotated to fit into the openings below) but the exact screen height/width (in tile units)? Shading and gradation of the pieces? Creative aspects of animation (such as shadowing)? Features, like previewing the next piece up?
Desiree Golden may have thought so at first – she asked Tetris Holding Co. for a license, with no success. So Golden’s company, Xio Interactive, went to Plan B, and created what it concluded would be a similar but non-infringing game. According to the court’s decision, “before releasing its product, Xio researched copyright law, both through its own independent studying and based on advice of counsel.”
However, judges have been known to disagree with lawyers, and in this case New Jersey U.S. District Court Judge Freda Wolsfon disagreed emphatically. In her May 30, 2012 opinion she held that the appearance of Tetris was protected under copyright, and that Xio’s version of Tetris infringed Tetris based on the “total concept and feel” of the copyrighted work. The “overall look and feel” was, she held, identical. This, she concluded was a case of “wholesale copying.”
Xiu had argued that anything it copied from Tetris related to rules, functions and expression essential to the game, and therefore Xiu’s program did not copy elements of Tetris that were protected by copyright. This defense may have been correct in theory, but it failed in execution. Yes, the “idea” of a game in which Tetris-shaped pieces can be manipulated to fall into place is not protected by copyright. However, Tetris made many aesthetic decisions that were unnecessary to the rules or functions of the game, yet were copied by Xiu. For example, in Xiu’s game the style of the pieces — their shading and gradation, even the color scheme — were very similar to Tetris. As the judge stated, “the style, design, shape, and mood and movement of the pieces are expression,” not “part of the ideas, rules or functions of the game.”
The protection of video games as audiovisual works under the Copyright Act is nothing new to copyright law. For example, Pac-Man received copyright protection based on the appearance of the characters and their motions and actions. (Atari v. North American Philips). The video game Galaxian received copyright protection based on the “look and feel” of the characters. (Midway v. Arctic Intern.). Like Tetris, these games are non-functional and highly creative. Therefore they receive broad copyright protection.
Could Xio have developed a non-infringing game of Tetris? Absolutely, but it would have required more creativity, and a better understanding of the copyright laws, than was demonstrated in this case.
Tetris v. Zio International
by Lee Gesmer | Jun 8, 2012 | Copyright
It is a well-known principle of copyright law that the Copyright Act has no extraterritorial reach. For example, a U.S. copyright holder cannot bring suit for copyright infringement, in the U.S., against individuals or companies who reproduce and sell, outside the U.S., software, music CDs, DVDs or other copyright-protected works.
What if, however, the initial infringement occurs in the United States, and the infringer distributes infringing copies outside the U.S.? For example, what if an employee illegally copies an employer’s software program in the U.S., transports it to France (either on physical media or electronically), and sells it in Europe? May the U.S. copyright holder recover damages based on lost profits or infringer profits in Europe?
Surprisingly, this “infringe locally/sell abroad” issue has rarely come up under copyright case law in the U.S. Until recently, only two courts have addressed it under the current copyright statute, the Second Circuit in 1988 (Update Art v. Modin) and the Ninth Circuit in 1998 (L.A. News Service v. Reuters). However, in each of those cases the courts did permit recovery of damages arising from overseas infringing uses as long as the “predicate act” of infringement occurred within the United States, enabling further reproduction abroad. By a “predicate act,” these courts meant simply that if the initial infringement took place in the U.S. and the foreign violations were directly linked to that infringement, then damages could be based on foreign sales.
This is what happened in Tire Engineering and Distribution, LLC. v. Shandong Linglong Rubber Co., a case decided by the Fourth Circuit in early June 2012. The facts of this case (somewhat simplified) involved the copying of designs for specialized tires for underground mining vehicles. The designs were copied in the U.S. by former and current employees of the plaintiff and provided to the foreign defendants, who sold infringing products abroad. The case proceeded to a jury trial in Virginia, where the trial court instructed the jury that it could find damages based upon infringement that occurred outside the United States, if those infringing acts “were a consequence or result of predicate infringing acts that occurred inside the United States.” The jury awarded the plaintiff $26 million in damages under this theory.
The Fourth Circuit upheld this verdict, holding that a plaintiff could invoke the predicate act doctrine by showing a domestic violation of the Copyright Act and damages flowing from foreign exploitation of that infringing act. In this case, the reproduction of the plaintiff’s blueprints in the United States constituted the predicate act necessary to satisfy this standard.
While this case involved a somewhat unusual fact pattern, it points out a legal doctrine that few lawyers are aware of, but which may be applicable in an interconnected world where markets for copyrighted works are international. The plaintiff’s lawyers in this case might easily have concluded, mistakenly, that their client would be unable to recover damages based on infringing sales outside the U.S. Instead, they utilized a little-known principle of copyright law, proceeded through trial hoping that it would be applied in their case, and on appeal persuaded the Fourth Circuit (which had never before addressed this issue) to adopt the predicate-act doctrine.
Tire Engineering and Distribution, LLC. v. Shandong Linglong Rubber Co. (4th Cir. June 6, 2012)
by Lee Gesmer | Apr 27, 2012 | CFAA, Copyright, DMCA/CDA, Trademark
I’ve posted the slides from a CLE talk I gave on Wednesday, April 25th. Hopefully, the slides are informative standing alone. They address the very recent DMCA decisions by the 9th Circuit (Veoh) and 2nd Circuit (Youtube), the copyright “first sale” doctrine as applied to digital files in the Redigi case pending in SDNY, and recent trademark “keyword advertising” cases decided in the 4th and 9th Circuits (Rosetta Stone in the 4th Circuit, Network Automation and Louis Vuitton in the 9th). There are also some slides devoted to the CFAA, including the 9th Circuit’s en banc decision in the Nosal case.
If the embedded Scribd document doesn’t appear on your computer directly below, click here to go directly to Scribd
Copyright and Trademark Issues on the Internet
by Lee Gesmer | Apr 5, 2012 | Copyright, DMCA/CDA
I’ll be reading this decision, issued today, more carefully in the next day or two, but my first impression is that it’s a win for supporters of the DMCA safe harbor statute based on various legal rulings, and a loss for Youtube based on the really dumb behavior of Youtube’s founders. Of course, these guys didn’t know, back in 2005, that seven years later the courts would be judging whether they were aware that they were hosting copyrighted videos. If they had known, they might not have emailed each other comments like these:
- “[W]e need views, [but] I’m a little concerned with the recent [S]upreme [C]ourt ruling on copyrighted material”
- “[S]ave your meal money for some lawsuits!”
- “concentrate all of our efforts in building up our numbers as aggressively as we can through whatever tactics, however evil”
- “our dirty little secret . . . is that we actually just want to sell out quickly”
And there’s more like that. Ouch!
In the future companies with Youtube-like businesses will, one hopes, not create evidentiary grist of this sort for content owners to use in lawsuits against them. So, this case may turn out to be a great lesson for the online industry (careful what you say), and an expensive lesson for Google, which will likely have to add some dollars to the $1.65 billion it paid for Youtube in 2006.
Second Circuit decision in Viacom v. Youtube
by Lee Gesmer | Apr 4, 2012 | Noncompete Agreements
Here is an unusual spin on Massachusetts non-compete law. As best I can understand the facts (which require a bit of “between the lines” reading) Trillium sued Cheung, a former employee of Trillium. Cheung had, it appears, released an employee from a non-compete agreement without company approval.
Trillium’s suit asserted breach of fiduciary duty to the company.
A trial ensued, but at the outset the judge observed that if the underlying non-compete agreement had not been enforceable the release had caused no harm to Trillium, and hence there had been no legal wrong committed by Cheung. In other words, the trial involved a concept that lawyers dislike greatly: a “trial within a trial.” (Think Russian nesting dolls). Here, the two trials involved the question of whether the non-compete was enforceable and, if so, whether Cheung acted illegally by releasing the employee from the agreement.
The trial began with a jury proceeding, during which the jury was asked to decide the second of these issues first – whether Cheung had improperly given the employee a release from the non-compete. However, in an odd twist the parties agreed that the judge, not the jury, would rule on damages. Before doing so, however, the judge addressed the second issue (which, one would think, should have gone first), held that the non-compete agreement was unenforceable, and concluded therefore that Trillium had suffered no damages. Case over.
The Appeals Court found several problems with this outcome, and sent the case back for a new trial. First, the judge failed to describe the legal standard he had applied to determine the enforceability of the non-compete agreement. The Appeals Court had no way of reviewing a trial judge’s decision if he failed to state, on the record in open court or in a written decision, the legal grounds for his conclusion. Making matters even worse, the Appeals Court indicated that the trial judge had heard evidence developed during the jury trial which contributed to his conclusion that the non-compete was unenforceable, but he failed to describe these facts so that the Appeals Court could review them and determine if the trial court had correctly applied the legal grounds to them. The Appeals Court had no record upon which is could review the ruling on the law or the facts.
This case illustrates a crucial aspect of legal proceedings that we sometimes take for granted, but which somehow got lost in this case. The Appeals Court observed that as far back as 1923 (and likely long before 1923) the Massachusetts Supreme Judicial Court noted “the underlying principle that a judge must set forth the legal grounds on which he makes his legal determination . . . the court shall specify with particularity the grounds on which his mind rests in reaching his conclusion. The parties thus are advised of the exact foundation for the action taken by the judge.” Without this information, there is no basis for appellate review.
Of course, when a case is decided by a jury things proceed a bit differently – a jury renders a verdict with no explanation of its grounds, and that decision is inviolate, so long as the judge properly instructs the jury on the law and follows the rules of evidence (more or less).
But, phase two of this case was a judge case, not a jury case, and why the judge didn’t explain the factual and legal bases for his decision is something of a mystery. The trial took place in early 2009 and now, three years later, the parties will have to undergo a retrial. However, it will still be a “trial within a trial” – as the Appeals Court stated, “we remand the matter for a new trial on the issue of damages, which shall include determination of the predicate issue of enforceability of the [non-compete] agreement.”
Trillium v. Cheung
