Wednesday, January 26, 2011

9th Cir. addresses procedural effect of presumption of validity under § 410(c) of the Copyright Act

The 9th Circuit today highlighted the procedural ramifications of the presumption of validity afforded by § 410(c) of the Copyright Act.

In United Fabrics Int’l, Inc. v. C&J Wear, Inc., No. 09-65499 (9th Cir. Jan. 26, 2010), the district court (sua sponte) dismissed plaintiff’s copyright claims, saying that: (1) the plaintiff hadn’t produced sufficient evidence of the “chain of title” in the underlying design (which it got from an Italian firm); and (2) the plaintiff hadn’t produced evidence that the designs, which were registered as a published collection, were actually published as a collection, as required under 37 CFR 202.3(4)(b).

The 9th Circuit reversed, holding that the district court ignored the statutory presumption of validity when it required the copyright owner to prove these things without first identifying evidence to the contrary. The appeals court noted that it was the defendants’ burden to first explode the presumption by coming up with some proof to the contrary on these issues.

Tuesday, January 18, 2011

3d Cir.: later-created "memorandum of transfer" of copyright not enough; historical evidence of transfer also required

Section 204(a) of the Copyright Act requires that, to be valid, a transfer of copyright ownership must be in writing, such as a “memorandum of the transfer.” The Third Circuit recently rejected the Ninth Circuit’s requirement that the memorandum of the transfer be “more or less contemporaneous” with the transfer, and held that a memorandum of transfer executed almost 9 years after the alleged transfer was fine (at least where the transferor and the transferee both signed it). But the court further held that there must also be historical evidence – beyond the later-created memorandum -- that the transfer actually occurred. The accused infringer in the case (who was not the transferor) had successfully moved for summary judgment challenging that the transfer ever occurred, and the Third Circuit affirmed that the transferee failed to raise a genuine issue of material fact on that point.

The case is Barefoot Architect, Inc. v. Bunge, No. 09-4495 (3d Cir. Jan. 14, 2011).

Thursday, January 06, 2011

8th Cir.: disgorgement of profits under Lanham Act does not, in all cases, require proof of actual confusion

The Eighth Circuit today clarified that its precedents do not necessarily require proof of actual confusion to qualify for an award of disgorgement of the infringer’s profits in all cases. It held that where a licensee willfully uses the mark for services beyond those authorized in the license, the licensor may seek disgorgement.

While the court did not expressly limit its ruling to this factual setting, it was careful to avoid broad dictum implying that disgorgement is available in all trademark infringement settings, irrespective of proof of actual confusion.

The case is Masters v. UHS of Del., Inc., No. 09-3543 (8th Cir. Jan. 6, 2011).

Tuesday, January 04, 2011

9th Cir. decision on re-sale of "promotional only" copies of music CDs

Promotional music CDs that were sent, unsolicited, from a record company to music critics and radio stations, were subject to “first sale doctrine” and could be freely re-sold—notwithstanding a disclaimer stating that the discs were licensed only and could not be re-sold or transferred.

In UMG Recordings, Inc. v. Augusto, No. 08-55998 (9th Cir. Jan. 4, 2011), Mr. Augusto somehow obtained a bunch of these promotional CDs and re-sold them on eBay. UMG sued him for copyright infringement, arguing that the disclaimer stamped on the discs precluded his “first sale defense”:

"This CD is the property of the record company and is licensed to the intended recipient for personal use only. Acceptance of this CD shall constitute an agreement to comply with the terms of the license. Resale or transfer of possession is not allowed and may be punishable under federal and state laws."

The court rejected UMG’s argument that the disclaimer created a license primarily because the UMG sent the CDs out unsolicited. The court also noted that no recipients responded back to UMG, and that UMG did not even try to figure out the status of the copies it sent to the initial recipients.

The court also held that the “Unordered Merchandise Statute,” 39 U.S.C. § 3009—the Unordered Merchandise Statute???; that's some good lawyering!—explicitly permits the recipients of any unsolicited merchandise sent through the mail or similar means to dispose of the merchandise any way they want. The court held that UMG’s unilateral attempt to create a license was inconsistent with this law.