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U.S. Intellectual Property and New Media Law Update MCLINTOCK V. SECTION SEVEN OF THE 1909 COPYRIGHT ACT Batjac Productions Inc. v. Goodtimes Home Video Corp. et al. (Ninth Cir. -November 5, 1998) FEDERAL ESPRESSO IS NOT DILUTED BY FEDERAL EXPRESS Federal Express Corp. v. Federal Espresso, Inc. et al. (N.D.N.Y. -September, 1998) VAPOR WARE BEWARE Pfaff v. Wells Electronics, Inc. (U.S. Supreme Court -November 10, 1998) FEATHERED PHOENIX Langman Fabrics v. Graff Californiawear, Inc. et al. (Second Cir. - November 9, 1998) MCLINTOCK V. SECTION SEVEN OF THE 1909 COPYRIGHT ACT Batjac Productions Inc. v. Goodtimes Home Video Corp. et al. (Ninth Cir. -November 5, 1998) This is an appeal from a District Court decision in a copyright action finding that the film at issue to be dedicated to the public domain. The suit was for infringement of the script for "McLintock!" The film hit the theaters in November 1963. The copyright for the film was also registered in 1963. When it was not renewed in 1991, the copyright for the motion picture lapsed and the film fell into the public domain. In 1993, Defendants began producing and selling videotapes of "McLintock!" Plaintiff countered by applying for copyright registrations for two intermediate drafts of the screenplay as unpublished works. The version of the screenplay actually used in the film was not submitted. In February 1996, Plaintiff started the present suit and on March 28, 1996, the Copyright Office declined to register the portion of the two drafts of which appeared in the film as being in the public domain. The Register of Copyrights intervened in the action in support of its position. The District Court held that the publication of the motion picture published the incorporated portions of the preexisting unpublished screenplay. The Ninth Circuit agrees in an interesting opinion. If the screenplay remained unpublished during the period 1963-1978, as Plaintiff contends, it would have gained statutory protection in 1978 under the Copyright Act of 1976 and would still be protected today. On the other hand, if the movie is also publication of the screenplay for the portions appearing in the movie, then such portions entered the public domain in 1991 along with the motion picture. The Ninth Circuit noted the decision turns on the interpretation of Section 7 of the 1909 Copyright Act. Section 7 of the 1909 Act provides that the publication of a derivative work does not affect the validity of an existing common law copyright in a pre-existing work. Plaintiff argues that Section 7 prevents destruction of an existing copyright by publication of a derivative work. Whether the term existing copyright means "statutory copyright" or "statutory and common law copyright" is critical. The Court used standard statutory interpretation rules to find that Section 7 only covered statutory copyright. Absent a registration for the screenplay prior to the release of the movie, the copyright was not preserved. For an interesting contrast, on October 19, 1998 we reported on Dolman v. Agee et al., a case where the Ninth Circuit found that the score for the soundtrack for a film was not published by publication of the film. FEDERAL ESPRESSO IS NOT DILUTED BY FEDERAL EXPRESS Federal Express Corp. v. Federal Espresso, Inc. et al. (N.D.N.Y. -September, 1998) Federal Express is a major corporation having 140,000 employees, shipping 2.9 million packages per night with annual revenues of $11 to $11.5 billion a year. In 1994 they started using the term "FedEx" as the predominant mark but still had FEDERAL EXPRESS on various vehicles, etc. Defendants were initially wholesale distributors of commercial espresso machines and branched into coffee shops in 1995 under the name FEDERAL ESPRESSO. FEDERAL EXPRESS sued and moved for a preliminary injunction. On the straight trademark counts, the Court analyzed the Polaroid factors and only found one factor, the strength of its mark, in Plaintiff's favor and refused to issue the injunction. More interestingly, it found no likelihood that Plaintiff would win on its dilution count. The Court found the mark was famous under the test of 15 U.S.C. § 1125(c) but found no dilution through blurring or tarnishment. With regard to tarnishment, there was no question that Defendants' products were not inferior goods. With regard to blurring, the Court used a combination of the requirements under the Lanham Act and under New York General Business Law. The Court found that for Federal dilution one weighs similarity of the products, sophistication of the consumer, renown of the senior mark and trade dress. Under New York business law, predatory intent is also a factor in the analysis. In the context of use, the Court found the marks were not similar, the services so disparate as to reduce the likelihood of blurring, the consumers of Plaintiff's sophisticated, the mark famous and the Defendants' mark not well known or famous. The Court also found no predatory attempt and, accordingly, in balancing the factors found no blurring. One can wonder how much the Federal dilution law broadens traditional trademark law. If all the factors for finding a famous mark and then finding blurring are weighed, you find that you have the Polaroid factors redux. What it may come down to, is that in most cases the only really good dilution claims are also good trademark claims. The decision can be viewed at: http://www.ipcounselors.com/fedex.htm VAPOR WARE BEWARE Pfaff v. Wells Electronics, Inc. (U.S. Supreme Court -November 10, 1998) This case is a rare occurrence, a decision by the Supreme Court on patent issues. The fact pattern and the resulting findings of fact and law are relatively simple for a patent case. The Petitioner filed an application for a patent on a computer chip socket in April 19, 1982. Section 102(b) of the Patent Act of 1952 bars issuance of a patent if the invention had been on sale more than one year prior to filing the patent application. Thus, a bar to the patent exists if the socket was on sale before April 19, 1981. The Petitioner began work on the socket in November 1980 when it was requested to do so by Texas Instruments. Prior to March 17, 1981, Petitioner showed a sketch of the concept to representatives of Texas Instruments. On April 8, 1981, Texas Instruments provided Petitioner with a written confirmation of a previously placed oral purchase order for 30,100 of the new socket for a total price of $91,155. At the time of the order, Petitioner had not made or tested a prototype. It took several months to develop the customized tooling necessary to produce the device and the order was not filled until July 1981, and, thus, the device was first reduced to practice after the critical date. Petitioner sued Defendant Wells under the patent which issued in due course. The Federal Circuit found that the one year is measured from the date of being on sale when the invention was "substantially complete at the time of the sale." Other circuits had previously assumed that an invention cannot be "on sale" within the meaning of Section 102(b) until it has been reduced to practice. The Supreme Court noted that it was well settled that an invention could be patented before it is reduced to practice, pointing to Alexander Graham Bell's application for a patent before having actually constructed a working telephone. Accordingly, the key factor is not reduction to practice but rather sufficient information to allow a patent to be filed. In other words, for Section 201(b) to come into act as a bar, the product must be the subject of a commercial offer for sale and the invention must be ready for patenting. The latter can be satisfied by either proof of reduction to practice before the critical date or by proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention. Applying this reasoning, it found that when it accepted the purchase order from Texas Instruments, Plaintiff had descriptions and drawings of sufficient clearness and precision to enable those skilled in the art to produce the device and, thus, the device was on sale before the critical date. The decision can be accessed at: http://supct.law.cornell.edu/supct/html/97-1130.ZS.html FEATHERED PHOENIX Langman Fabrics v. Graff Californiawear, Inc. et al. (Second Cir. - November 9, 1998) This case is another copyright case, this one involving a feather pattern on fabric. The District Court found summary judgment for the Defendant, holding that one of the Plaintiff's principals made concessions in his deposition fatal to its case. The Court did not look at later elaboration on his earlier testimony since the Court felt it was contradictory to the earlier testimony on the question of whether the work was a work-for-hire and whether that principal was an author or joint author. The District Court also held that any copyright was forfeited by failing to include the year of first publication in the copyright notice. The Second Circuit, in reviewing the situation, overturned the District Court in almost every aspect. First and foremost, it found that the earlier deposition and the later declaration and depositions were not contradictory, they were mere amplifications in situations where the deponent was unsure of certain facts at the time of his first deposition. Thus, while a contradictory affidavit or declaration could not be introduced as a defense against a summary judgment motion, one that amplifies or clarifies can be so introduced. If the later evidence is reviewed, the Second Circuit believes there is sufficient evidence to conclude that the work was either a work-for-hire or that one of Plaintiff's principals was the co-author so that summary judgment would be inappropriate. With regard to the omission of the year, under 17 U.S.C. § 401(b)(2) it is clear that the year date may be omitted where a pictorial, graphic or sculpture work is reproduced in or on any useful article. Thus, the question of whether the omission of the date is fatal rests on whether fabric is a useful article. The District Court found that it was not a useful article until it was made into clothing and the Second Circuit found that it was a useful article even when in bulk, since the fabric was, in this case, intended to be made into clothing. The decision can be seen at: http://www.law.pace.edu/lawlib/legal/us-legal/judiciary/second-circuit/test3/97-7930.opn.html |
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