Copyright Law/Exclusive Rights of the Copyright Owner

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< Copyright Law

Copyright Law Treatise
Table of Contents
Copyright Law Outline
History and Background
The Copyright Statutes
Copyright as an Element of Intellectual Property Law
Copyright Office and Judicial Review
The Subject Matter of Copyright
General Principles
The Distinction Between Idea and Expression
Compilations and Derivative Works
Pictorial, Graphic, and Sculptural Works
Pictorial and Literary Characters
Government Works
Duration and Renewal
The Renewal Format
Duration of Copyright Under the 1976 Act
Ownership of Copyright
Initial Ownership of Copyright
Transfer of Copyright Ownership
Termination of Transfers
Copyright Formalities
Formalities Under the 1909 Copyright Act
Copyright Notice Under the 1976 Act
Deposit and Registration
Exclusive Rights of the Copyright Owner
The Right of Reproduction
Reproduction of Music and Sound Recordings
The Right to Prepare Derivative Works
The Right of Public Distribution
The Right of Public Performance
The Right of Public Display
Visual Artists’ Rights
Secondary Liability: Contributory and Vicarious Infringement
Fair Use and Other Exemptions from the Exclusive Rights of the Copyright Owner
Fair Use
Exemptions and Compulsory Licenses
Enforcement of Copyright
Jurisdictional and Procedural Issues
Technological Protection Measures
State Law and Its Preemption
State Anti-Copying Laws
Federal Preemption

Perhaps the most significant provisions of the Copyright Act are found in section 106, which sets forth the exclusive rights of the copyright owner. Anyone who violates any of those rights is (by virtue of section 501) “an infringer of the copyright.” Section 106 gives the owner of copyright

the exclusive rights to do and to authorize any of the following:

  1. to reproduce the copyrighted work in copies or phonorecords;
  2. to prepare derivative works based upon the copyrighted work;
  3. to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending;
  4. in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly;
  5. in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly; and
  6. in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.

It should be noted that the copyright owner has the exclusive right not only to do the listed acts but also to authorize others to do them. Thus, if A owns the copyright in a novel, which is published by B, and B (without A’s consent) authorizes producer C to make a motion picture based upon the novel, when C’s film is later released A can bring infringement actions against both B and C. The Supreme Court has, in effect, concluded that this “authorize” language furnishes the basis for incorporating into copyright law the principle of contributory infringement.[1] Note also that although a work to be eligible for copyright protection must be fixed in tangible form, unauthorized conduct can infringe even though it does not involve a fixing of the work by the defendant—for it may be by public sale, performance or display. Most obviously, for example, a copyrighted song or play can be infringed by an unauthorized (and “unfixed”) public performance in a theater. The first three listed exclusive rights—reproduction, preparation of derivative works, and public distribution—are applicable to all forms of copyrightable works listed in section 102(a). The next two listed rights—public performance and public display—are, by their nature, applicable only to certain categories of copyrightable works, and those categories are expressly set forth in sections 106(4) and (5). For example, the right of public performance attaches to musical works but not to sound recordings; that means that an unauthorized public playing by a disk jockey in a nightclub of a recording of a copyrighted song will constitute an infringement of the song but not of the sound recording, so that the songwriter–author will have legal redress but the record manufacturer and performer will not. If, however, the public playing of the recorded song is “by means of a digital audio transmission,” such as from a website on the Internet, then this is among the exclusive rights of the sound-recording copyright owner, by virtue of a 1995 amendment that added section 106(6) to the Copyright Act. All of the exclusive rights in section 106 are subject to the provisions in sections 107 through 122. Those provisions exempt from liability a wide range of reproductions, derivative works, and the like that would otherwise constitute infringements, particularly for nonprofit, charitable or educational purposes. These exemption provisions will be discussed in some detail in Fair Use and Other Exemptions from the Exclusive Rights of the Copyright Owner.

The Right of Reproduction[edit | edit source]

The first U.S. copyright act, enacted in 1790, forbade unauthorized printing of copyrighted works. Today, the equivalent right, afforded by section 106(1) of the 1976 Act, is the right “to reproduce the copyrighted work in copies or phonorecords.”

Reproduction in copies or phonorecords[edit | edit source]

Copies and phonorecords are the tangible forms in which reproductions of a work can be made; copies communicate to the eye while phonorecords communicate to the ear. More precisely, “phonorecords” are defined in section 101 as “material objects in which sounds . . . are fixed by any method now known or later developed, and from which the sounds can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.” “Copies” are defined as “material objects, other than phonorecords, in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.” The owner of copyright in a musical composition has the exclusive right, therefore, to make “copies” in the form of music notations intended for piano or for orchestra, as well as to make “phonorecords” that can be activated by a playback device such as an audiotape-player or compact disk player. A significant reason for distinguishing copies and phonorecords relates to the proper form of optional copyright notice—with the notice on copies, and the notice (for the sound recording) on phonorecords.

The application of the word “copy” as used in section 106(1) has kept up with the advent of new technologies. Thus, if unauthorized copies are generated through the use of a fax machine, that will infringe.[2] So too, if a copyrighted photograph is scanned, without permission, from a magazine into a computer for storage in a hard-drive or on a website, that will generate a copy and an infringement; the unauthorized transmission of that digitized photograph to others is treated as a distribution of copies that has been held unlawful under section 106(3).[3] The Supreme Court in 2005, in Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd.,[4] involving so-called peer-to-peer filesharing of music recordings through the Internet, assumed—as did even the defendants who made available the file-sharing software—that the private users of computers for downloading were making illicit copies. This was directly so held, soon after, by the Court of Appeals for the Seventh Circuit.[5] There is disagreement in the scholarly literature as to whether the more transient storage of a work in the random access memory (RAM) of a computer—as is done in the case of an operating-system program when a computer is simply switched on— constitutes the making of a “copy.” But the fact that Congress has thought it necessary to write certain narrow exemptions for RAM copying in section 117 of the Copyright Act points clearly toward a congressional understanding that such copying would otherwise be infringing under section 106.[6]

Proving copying and infringement[edit | edit source]

The exclusive right to “reproduce” the copyrighted work—which involves copying—is more confined than the patent right, which can be infringed even by a product or process that has been developed wholly independent of, and has not been copied from, the patented invention. Perhaps the best-known discussion of proof of copyright infringement is found in Arnstein v. Porter,[7] decided by the Court of Appeals for the Second Circuit in 1946. Judge Frank there stated, “[I]t is important to avoid confusing two separate elements essential to a plaintiff’s case in such a suit: (a) that defendant copied from plaintiff’s copyrighted work and (b) that the copying (assuming it to be proved) went so far as to constitute improper appropriation.”[8] Proof of copying can be found, said the court, either in defendant’s admission or, as is almost uniformly the case, by circumstantial evidence—usually evidence of access and similarity—from which the trier of fact may reasonably infer copying. Of course, if there are no similarities, no amount of evidence of access will suffice to prove copying. If there is evidence of access and similarities exist, then the trier of fact must determine whether the similarities are sufficient to prove copying. On this issue, analysis (“dissection”) is relevant, and the testimony of experts may be received to aid the trier of fact.

Although “similarity” is an element of both stages of the Arnstein test for infringement, the purposes and scope are different. At the first stage, similarity is used for the purpose of determining whether there has been copying. The similarities between the two works need not be extensive, so long as they are “probative” of copying: for example, the Rural Company planted four fictitious directory entries in its whitepage telephone directory, and these entries then showed up in the Feist directory, which obviously negated independent creation.[9] On the other hand, the similarities that are necessary to make out an illicit taking, at the second stage, must be “substantial” as measured either qualitatively or quantitatively.

In proving copying through the use of circumstantial evidence, there is sometimes said to be an inverse proportion between the weight of proof of access and of similarity: the less likely it is that the defendant had access to the plaintiff’s work, the more convincing must be proof of similarities in the two works; the fewer the similarities, the more compelling must be the proof of access. An inference of copying can be drawn even in the absence of specific evidence of access if the similarities between the plaintiff’s and defendant’s works are found to be “striking.” As the Court of Appeals for the Seventh Circuit has stated: “A similarity that is so close as to be highly unlikely to have been an accident of independent creation is evidence of access. . . . Access (and copying) may be inferred when two works are so similar to each other and not to anything in the public domain that it is likely that the creator of the second work copied the first, but the inference can be rebutted by disproving access or otherwise showing independent creation.”[10]

In any event, proof of copying is not sufficient to make out a case of infringement. The plaintiff must also prove that what has been copied is substantial in degree; only then, in the words of the Arnstein decision, is the copying illicit and the appropriation unlawful. Although Arnstein acknowledged that expert witnesses, through dissection of the two compared works, may usefully contribute to an understanding by the trier of fact as to the similarities for the purpose of determining copying, such expert dissection is essentially regarded as irrelevant on the second issue, as to which “the test is the response of the ordinary lay hearer.”[11] In a later case involving claimed infringement of a fabric pattern, Learned Hand stated that the perspective in determining whether the alleged infringing work is “substantially similar” to the copyrighted work must be that of “the ordinary observer.”[12] If the parties’ works are intended for purchase or appreciation by a particular audience—such as choir directors or even very young children—the question of substantial similarity is to be addressed with those persons in mind.[13]

Under this universally accepted two-step approach to proof of infringement,[14] it might be found that although the defendant did copy from the plaintiff’s copyrighted novel, song or fabric design, proof of substantial similarity is lacking, so that there is no infringement. This would occur, for example, if the defendant copied only isolated and minor elements that did not create an appearance of similarity when viewed or heard by a typical member of the audience to whom the two works are addressed. In these cases, the doctrine of de minimis would apply.[15] An example would be a case in which a short, even perhaps copyrightable, pattern in a recorded song is digitally duplicated, or “sampled,” on another recording.[16]

Relatedly, even if the defendant has recognizably copied from the plaintiff’s copyrighted work, there is no infringement if he or she has copied only elements that are themselves unprotected by copyright. Thus, anyone is free to copy concepts, methods, and systems described in the plaintiff’s work, and to express them in his or her own words, for such concepts, methods, and systems fall outside the protection of copyright by virtue of section 102(b) of the Copyright Act. The same is true when the defendant copies such unprotectible elements as commonplace phrases, or language that is in the public domain. As the Supreme Court observed in a case involving copyright protection for fact-based directories,[17] copyright may protect the original pattern in which the facts are organized but the facts themselves are in the public domain and free for all to use. The Court stated:

As applied to a factual compilation, assuming the absence of original [prose] expression, only the compiler’s selection and arrangement may be protected; the raw facts may be copied at will. This result is neither unfair nor unfortunate. It is the means by which copyright advances the progress of science and art.[18]

If protectible expression has been substantially copied, it is not a defense that the copying was done unknowingly; like trespass in the law of real property, even unintended encroaching upon another’s copyright is unlawful. This principle takes two forms. First, if B takes to publisher C a work actually written by copyright owner A, and B represents to publisher C that B is the author and copyright owner, C’s publication of the work will infringe A’s copyright, no matter how honestly C may have believed that B was the true copyright owner.[19] Obviously, C is in a better position than A to protect its rights, either through a copyright search, insurance, or contractual indemnity arrangements with B. Second, one may infringe even through “unconscious” copying. In a well-known case,[20] then-former Beatle George Harrison was found to have written a song essentially identical to a popular song written by another, through assimilation of the earlier song in Harrison’s subconscious. Although the court found the copying was not deliberate, it concluded that infringement “is no less so even though subconsciously accomplished.”[21]

Idea versus expression[edit | edit source]

Recall that there is no infringement when one copies unprotectible ideas from another—as distinguished from protectible “expression.” The distinction between idea and expression is perhaps the most elusive of all lines in copyright jurisprudence. As Learned Hand has stated: “Obviously, no principle can be stated as to when an imitator has gone beyond copying the ‘idea,’ and has borrowed its ‘expression.’ Decisions must therefore inevitably be ad hoc.”[22]

In cases involving literary works, copyright protection would, of course, be trivialized were it limited to no more than the precise sequence of the author’s words, or were it even extended to embrace no more than very close paraphrase. It is undisputed that copyright also protects the details and sequences of plot, story line, and character development, but that it does not protect the author’s more general themes. Hand is once again the source of eloquent insight:

[W]hen the plagiarist does not take out a block in situ, but an abstract of the whole, decision is more troublesome. Upon any work, and especially upon a play, a great number of patterns of increasing generality will fit equally well, as more and more of the incident is left out. The last may perhaps be no more than the most general statement of what the play is about, and at times might consist only of its title; but there is a point in this series of abstractions where they are no longer protected, since otherwise the playwright could prevent the use of his “ideas,” to which, apart from their expression, his property is never extended. Nobody has ever been able to fix that boundary, and nobody ever can.[23]

In the case from which this observation is taken, Nichols v. Universal Pictures Corp., Judge Hand concluded that a very popular copyrighted play, Abie’s Irish Rose, was not infringed by the defendant’s motion picture The Cohens and the Kellys. The only story elements that were similar (and that were, for purposes of decision, assumed to have been original with the plaintiff and copied by the defendant) were a conflict between Irish and Jewish fathers, the marriage of their children, the birth of a grandchild, and the reconciliation of the elders. The court characterized these elements as “too generalized an abstraction . . . only a part of [the playwright’s] ‘ideas.’”[24] The plaintiff also failed in her claim that her characters, isolated from the story line, were infringed; the court found them to be stock characters, too vaguely drawn for protection.

A court’s determination that a plot or a character is an unprotectible “idea” reflects its conclusion that the plot or character is so skeletal or fundamental that to protect it by copyright would “fence off” too great a preserve for the plaintiff and would inhibit the creative use and embellishment of such plot or character by other authors. For the same reason, copyright does not extend to simply recorded facts, to commonplace phrases, or to what are known as scènes à faire, i.e., plot incidents that are commonplace or stock or that are necessarily dictated by a story’s general themes (such as soldiers nervously partying on the eve of battle, or the exchange of salutes between military personnel).[25]

The same approach to the idea–expression dichotomy is found in cases involving pictorial, graphic, or sculptural works.[26] Copyright does not extend to commonplace designs, lest others be forbidden— potentially for more than a century—to borrow these “building blocks” on which to base other creative works. In ruling that a jewelry designer could not preclude another from copying his jeweled pin in the shape of a bee, a court stated:

The guiding consideration in drawing the line is the preservation of the balance between competition and protection reflected in the patent and copyright laws.

What is basically at stake is the extent of the copyright owner’s monopoly—from how large an area of activity did Congress intend to allow the copyright owner to exclude others? We think the production of jeweled bee pins is a larger private preserve than Congress intended to be set aside in the public market without a patent. A jeweled bee pin is therefore an “idea” that defendants were free to copy.[27]}}

A contrary outcome was reached by Judge Learned Hand, in a decision usually contrasted with his decision in Nichols. He found infringement in Sheldon v. Metro-Goldwyn Pictures Corp.,[28] because the defendant’s motion picture had copied too many detailed plot incidents and scenes from the plaintiff’s play. Whether or not those incidents or scenes were protectible “expression” when each was considered separately, their sequential grouping—and thus the detailed storytelling—was deemed protectible by copyright.

Similar tests for distinguishing idea and expression have been applied in all varieties of copyrighted works, including computer programs. The tasks to be accomplished by a computer program, either in driving the computer hardware or in effecting a particular external result (such as creating the sights and sounds of a video game, or accomplishing word-processing tasks) are not subject to copyright protection; they are methods or systems that can be protected, if at all, only by satisfying the more rigorous demands of the patent system. On the other hand, the exact or very close copying of computer-program code—whether in human-readable source code or in object code (a string of ones and zeroes) intended to be “read” by and to operate the computer—will constitute an infringement of copyright.[29] As is true in literature, music and art, difficult questions can arise in drawing the line for infringement at various places in between a program’s overall purpose and its literal code; there is no question, however, that the fact that computer code is shaped by uniquely functional objectives justifies a “thinner” copyright for programs than for art as broadly understood.

Perhaps the most influential formulation for determining what “nonliteral” elements of computer code warrant copyright protection is found in Computer Associates International, Inc. v. Altai, Inc.[30] There, the Court of Appeals for the Second Circuit articulated a three-step process of analysis. At the first, or “abstraction” step, very much like the “patterns” analysis of Learned Hand in the Nichols and Sheldon drama cases,

a court should dissect the allegedly copied program’s structure and isolate each level of abstraction contained within it. This process begins with the code and ends with an articulation of the program’s ultimate function. . . . A program has structure at every level of abstraction at which it is viewed. At low levels of abstraction, a program’s structure may be quite complex; at the highest level it is trivial.[31]

At the second, or “filtration,” step, nonprotectible materials are removed from the plaintiff’s computer program.

This process entails examining the structural components at each level of abstraction to determine whether their particular inclusion at that level was “idea” or was dictated by considerations of efficiency, so as to be necessarily incidental to that idea; required by factors external to the program itself; or taken from the public domain and hence is non-protectable expression. . . . By applying well developed doctrines of copyright law, it may ultimately leave behind a “core of protectable material.”[32]

At the third, or “comparison,” step, the court compares what is left (the “golden nugget”) of protectible material in the plaintiff’s work and “focuses on whether the defendant copied any aspect of this protected expression, as well as an assessment of the copied portion’s relative importance with respect to the plaintiff’s overall program.”[33] Despite the influence of the court’s analysis—and indeed its importation into cases involving novels, plays, and motion pictures—it is arguably too focused upon the deletion of uncopyrightable elements and insufficiently attentive to the possible creative ways in which those elements can be selected, coordinated, or arranged so as to generate a protectible work in the nature of a compilation.[34]

Reproduction of Music and Sound Recordings[edit | edit source]

The exclusive right to reproduce the copyrighted work, afforded by section 106(1), applies not only when the work is reproduced in “copies,” i.e., material objects that are perceivable by the human eye, but also when the work is embodied in “phonorecords.” A copyrightprotected dramatic or nondramatic literary work (a short story, poem and lecture are examples of the latter) is infringed by an unauthorized taping or recording of the text of that work.

Reproducing musical works in phonorecords[edit | edit source]

The same is true of musical compositions, subject to an important exception known as the compulsory license. Section 115(a)(1) of the Copyright Act provides:

When phonorecords of a nondramatic musical work have been distributed to the public in the United States under the authority of the copyright owner, any other person may, by complying with the provisions of this section, obtain a compulsory license to make and distribute phonorecords of the work.

In substance, once the copyright owner of a musical composition permits one person to manufacture and distribute recordings in the United States, any other person may record the composition (with its own performers) and distribute its own recordings, provided that person complies with the provisions of section 115—most significantly by paying to the copyright owner a royalty provided by statute “for every phonorecord made and distributed in accordance with the license.”[35] The compulsory license for musical recordings (known as “mechanical” royalties, based on the early statutory language) can be traced back to the 1909 Copyright Act, enacted when the recording industry was in its infancy and when Congress was concerned that a single record manufacturer (the Aeolian Company) would secure a monopoly by buying up all recording rights from popular songwriters. By “compelling” the copyright owner to license such rights to all record companies, after the initial recording and distribution, Congress facilitated the development of many smaller record companies and the competitive nature of the industry that remains one of its characteristics today. The statutory royalty rate in the 1909 Act was 2 cents per record of the copyrighted song. In 1976, Congress increased that rate only to 2.75 cents. Realizing that economic conditions might warrant a change in the statutory rate, and that it would be inconvenient to achieve such change through statutory amendment, Congress in the 1976 Act created an administrative agency called the Copyright Royalty Tribunal and empowered it periodically to reconsider the royalty rate under section 115 and to promulgate new rates. In 1993 Congress transferred the functions of the Tribunal to ad hoc arbitration panels convened by the Librarian of Congress; and in 2004 the Act was amended to give such authority instead to three Copyright Royalty Judges, also appointed by the Librarian of Congress, with decisions of the Copyright Royalty Judges being appealable to the District of Columbia Circuit.

Section 801(b)(1) of the Copyright Act directs the Copyright Royalty Judges, in their rate-setting under the compulsory-license provisions for recorded music, to achieve the following objectives:

(A) To maximize the availability of creative works to the public. (B) To afford the copyright owner a fair return for his or her creative work and the copyright user a fair income under existing economic conditions. (C) To reflect the relative roles of the copyright owner and the copyright user in the product made available to the public with respect to relative creative contribution, technological contribution, capital investment, cost, risk, and contribution to the opening of new markets for creative expression and media for their communication. (D) To minimize any disruptive impact on the structure of the industries involved and on generally prevailing industry practices.

After formal hearings, the Copyright Royalty Tribunal in 1980 increased the statutory rate from 2.75 cents per record to 4 cents per record, and between then and the year 2000, the royalty rate mounted gradually through formal linkage to the Consumer Price Index. Beginning on January 1, 2000, Copyright Office regulations endorsed an agreement reached by representatives of music copyright owners (songwriters and publishers) and of the recording companies, providing for biannual rate increases beginning at 7.55 cents per song; the rate for 2004–2005 was 8.5 cents (or 1.65 cents per minute), and beginning January 1, 2006, the rate has become 9.1 cents per song (or 1.75 cents per minute). These compulsory-license royalty rates are set forth in Copyright Office regulations at 37 C.F.R. § 255.3. This royalty figure is for each recording made of each copyrighted composition embodied in the phonorecord; it is not a single amount covering the aggregate of all of the music on a multiple-track compact disk or audiotape.

To avail itself of the compulsory license, a record manufacturer must file a timely “notice of intention” with the copyright owner, file regular accounting statements, and make monthly royalty payments to the copyright owner. Failure to comply with these requirements entitles the copyright owner to terminate the license and sue for infringement. The monitoring of the compulsory license system, and particularly the scrutiny of accounting statements and the collection of royalties from the recording companies, is a major administrative task; most musicalwork copyright owners have turned over that task to an organization (based in New York City) known as the Harry Fox Agency. Congress, of course, contemplated that persons making music recordings (known in the industry as “covers”) pursuant to the statutory compulsory license under section 115 would use the services of recording artists selected by them and make arrangements of the music suitable to the artists’ performing style. Section 115(a)(2) provides, however, that such “arrangement shall not change the basic melody or fundamental character of the work, and shall not be subject to protection as a derivative work under this title, except with the express consent of the copyright owner.” The statute places three other important limitations upon the availability of the compulsory license. It does not apply to works other than “nondramatic musical works” (that is, it does not authorize the making of recordings of literary works or of operas); it comes into operation only after the first authorized recording; and it authorizes only the making of recordings that are intended primarily for distribution to the public for private use (i.e., it does not apply to recordings for music subscription services, such as Muzak, or the incorporation of the music in a motion-picture soundtrack). Until recently, the compulsory license for the recording of copyright-protected music resulted in phonorecords—whether vinyl records, audiotapes, or compact disks—that reached the public through sales in retail record stores. With the advent of the Internet, retail-store purchases are gradually being displaced by the online sale of music recordings. (Much music “sharing” through the Internet is regrettably unlawful, but not all.) When the computer user downloads recorded music, say for 99 cents per song, this is what the Copyright Act refers to in section 115(c)(3) as a “digital phonorecord delivery.” Because of their functional equivalence, the compulsory royalty rate to be paid to the music copyright owner by the recording company for such digital phonorecord deliveries is the same as for phonorecords sold in retail stores.

Reproducing sound recordings in phonorecords[edit | edit source]

The right under section 106(1) to reproduce a copyrighted work in the form of phonorecords applies to all copyrighted works, including not only musical works but also sound recordings. “Sound recordings” are defined in section 101 of the Copyright Act as “works that result from the fixation of a series of musical, spoken, or other sounds, but not including the sounds accompanying a motion picture or other audiovisual work, regardless of the nature of the material objects, such as disks, tapes, or other phonorecords, in which they are embodied.” Sound recordings are copyrightable works distinct from the musical or literary works that are performed on those recordings.[36] There can, for example, be a copyrightable sound recording of a public domain classical musical composition.

Section 114 of the Copyright Act limits the exclusive right to reproduce a sound recording to “the right to duplicate the sound recording in the form of phonorecords that directly or indirectly recapture the actual sounds fixed in the recording.” Infringement of this right is familiarly known as record piracy, and involves the dubbing of the sounds of the copyrighted sound recording onto another sound medium—for example, from a pre-recorded compact disk onto a blank audiotape or from a computer hard-drive onto a blank CD (i.e., “burning”). Copyright in a sound recording is therefore not infringed by the “independent fixation of other sounds, even though such sounds imitate or simulate those in the copyrighted sound recording,” as expressly stated in section 114(b).

Thus, when a commercial recording incorporates a “digital sample” taken directly from another recording, without permission, there is technically a violation of section 106(1), because the first “sound recording” (as well as the thread of musical notes) is being “reproduced in phonorecords.” These samples, although usually of only a small bit of recorded music, are often “catchy” and thus of qualitative significance and possible commercial value. Courts take differing views on whether the sampling, under particular circumstances, is nonetheless privileged, typically by invoking (or not) the de minimis principle[37] or the principle of fair use. In the recording industry, it is common practice to pay voluntary royalties for such samples (on the theory that today’s borrower may find himself or herself sampled tomorrow and will wish to be compensated).

A major issue under section 106(1) is the “home recording” of copyright-protected music and sound recordings. Again, this is technically a violation of section 106(1). However, at the time of enactment of the 1976 Act, it was generally understood that the “taping” of music from radio broadcasts or from recordings, for personal use and without commercial objective, was allowable. This was at a time when the analog technology was such that multiple and serial copying was inherently limited. This legal conclusion was essentially confirmed by the Supreme Court in the somewhat different context of home videotaping for “time-shifting” purposes (rather than for permanent retention).[38] For the first time in U.S. statutory copyright law, Congress in 1992 enacted legislation specifically addressing the problem of private copying: the Audio Home Recording Act (AHRA).[39] The AHRA, enacted in response to the advent of digital audiotape (which ultimately proved to have only limited commercial success), inter alia prohibited in section 1008 infringement actions “based on the noncommercial use by a consumer of a [digital audio recording device or an analog recording] device or medium for making digital or analog musical recordings.” In other words, home reproduction for noncommercial purposes, whether by analog or digital means, is exempted from the reach of the section 106(1) reproduction right held by owners of copyright in musical works and in sound recordings. Such copyright owners are to be recompensed through the payment of a royalty on the sales of digital recording machines and blank digital recording media.[40] The issue of using home computers to “swap” recorded music by means of software available on the Internet is more broad-ranging and has been found not to fall within the section 1008 exemption (this issue is discussed below).

The Right to Prepare Derivative Works[edit | edit source]

Among the most valuable rights given by the Copyright Act is the right under section 106(2) “to prepare derivative works based upon the copyrighted work.” The copyright owner thus has the exclusive right to convert her novel into a motion picture, to translate her play into a foreign language, to make an orchestral arrangement of her piano piece, or to make reproductions of her painting or sculpture—or to license third persons to do so. As defined in section 101, a derivative work

is a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship, is a “derivative work.”

In the cases already discussed—infringing motion pictures based on copyrighted plays or novels—the courts have traditionally analyzed them as involving “copies” under the 1909 Act or “reproductions” under the 1976 Act. The courts could just as well have analyzed these cases as allegedly infringing derivative works under what is today section 106(2). The elements of proof are the same: the plaintiff must show that the defendant copied protectible elements from the copyrighted work and that as a result the infringing work is “substantially similar.”

The derivative work need not be “fixed in a tangible medium” in order to make out a case of infringement. The live performance of an arrangement of a copyrighted song, without the authorization of the copyright owner, will infringe section 106(2). (The performance, if public, will constitute a separate infringement under section 106(4).) Nor need any words be borrowed from the copyrighted work. In a classic copyright case, Justice Holmes spoke for the Supreme Court in finding that a silent motion picture adaptation of the novel Ben Hur constituted copyright infringement.[41] In a more recent treatment of a similar issue, the Court of Appeals for the Second Circuit held that a book containing a series of still photographs of performers dancing a copyrighted choreographic work (Balanchine’s Nutcracker ballet) can be an infringing derivative work if there is “substantial similarity,” even though it is not possible to reconstruct the ballet from the photographs alone, and even if permission for the book was secured from the ballet company, the set and costume designers, and the dancers—but not from the choreographer–copyright owner.[42]

An infringing derivative work may take the form of deletion, abbreviation, and abridgment as well as elaboration and embellishment. The Court of Appeals for the Second Circuit, in the well-known case Gilliam v. American Broadcasting Companies,[43] thus held that the heavy editing of television programs without the consent of the Monty Python comedy group, which held the copyrights in the underlying scripts, constituted copyright infringement.

The courts are split on the question whether an infringing derivative work is created when one lawfully purchases a lawfully made pictorial work (say, a color photograph from a magazine, or a drawing on the face of a greeting card) and affixes it to a hard substance, thus creating a border around the work, and applies some transparent sealing substance. As will be seen immediately below, the purchase and resale of the artwork is not a copyright infringement, but the copyright owner of the photograph or greeting card has claimed that an infringing derivative work has been created. The Court of Appeals for the Ninth Circuit holds that, absent consent, a new bordered work has been unlawfully created; while the Seventh Circuit holds that there has been no “recasting” or “transforming” of the underlying artwork but simply what is equivalent to framing, and so no derivative work at all.[44] In a case involving an Internet analogy—the unauthorized “framing” by one website owner of images from another (complaining) website that are called forward through a linking process—a district court in the Ninth Circuit has found an unauthorized derivative work.[45]

The Right of Public Distribution[edit | edit source]

Section 106(3) of the Copyright Act gives the copyright owner the exclusive right “to distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending.” Thus, if A owns the copyright in a novel, and B prints unauthorized copies and supplies them to C, who sells them to the public, both B and C are copyright infringers—B violates section 106(1) and C violates section 106(3).[46] C will be liable, under the general rule of copyright that recognizes even “innocent” infringement, regardless whether he sells the books in the belief B was their lawful author.

Just as there is a public distribution when a bookseller distributes copies throughout the United States, so too a person who, without authorization, places copyrighted material on an Internet bulletin board or website and makes it available for all interested persons to download into their computer hard-drive (or even simply to view on their computer monitors) has publicly distributed that material, and has infringed.[47] If, however, the alleged infringer is merely an online service provider that plays a passive role in allowing access to an infringing website, without creating or controlling the content of the information available to its subscribers, it will generally be found not to have made an unlawful public distribution.[48]

First-sale doctrine[edit | edit source]

If read literally, section 106(3) would make it an infringement for a book dealer to sell used books or for any private person to lend a book to friends. This anomaly is quickly dispelled by virtue of section 109(a), which provides:

Notwithstanding the provisions of section 106(3), the owner of a particular copy or phonorecord lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.

This provision articulates what has been a fundamental part of our copyright jurisprudence for a century: the “first-sale doctrine.” The Supreme Court in its 1908 decision in Bobbs-Merrill Co. v. Straus stated: “[O]ne who has sold a copyrighted article, without restriction, has parted with all right to control the sale of it. The purchaser of a book, once sold by authority of the owner of the copyright, may sell it again, although he could not publish a new edition of it.”[49] The exclusive right to distribute the copyrighted work to the public thus embraces only the first sale, and purchasers of copies or phonorecords are free to transfer them to others by sale, gift, or otherwise. The first sale “exhausts” the right of the copyright owner under section 106(3), and he or she must exact whatever royalty can be negotiated from the initial publisher–distributor, knowing that that will have to provide recompense for all subsequent transfers as well.

Thus it is lawful, for example, for a person to purchase secondhand copies of copyrighted works, to remove the covers or to bind them in new covers, and to resell them to the public.[50] If, however, the reseller goes a step farther and makes some alteration in or compilation of the lawfully purchased works, he or she may be found liable for creating an unlawful derivative work even if not for unlawful public distribution. A court so held when the defendant purchased old copies of National Geographic magazine, tore out articles, and bound together for sale articles relating to a common subject matter.[51]

In 1998, in Quality King Distributors, Inc. v. L’Anza Research International, Inc.,[52] the Supreme Court confronted the question whether the first-sale doctrine applies not only to copies and phonorecords manufactured in the United States and subsequently sold here, but also when those subsequent sales follow purchases made abroad. To answer that question, the Court analyzed section 602(a), which gives the U.S. copyright owner the exclusive right of importation. The central issue was whether the first-sale limitation set forth in section 109(a) applied to imported goods, or whether section 602(a) afforded a “free standing” right not subject to the various exemptions (including fair use and first sale) in the Copyright Act. The Court concluded that the importation right under section 602(a) is a species of the public-distribution right under section 106(3), so that the copyright owner exercises that right subject to the first-sale doctrine. So- called grey goods or parallel imports, at unauthorized discounted prices, cannot thus be restricted by U.S. manufacturers by invoking the Copyright Act.

By virtue of the first-sale doctrine, U.S. law does not afford the kind of “public lending right” given to the copyright owner in such nations as Great Britain and Germany. U.S. copyright owners can claim no royalty, and can interpose no ban, when third persons—such as public libraries or private lending libraries—lawfully purchase one or two copies of a work and lend them to the public many times, either free or for a price. Section 109(a) negates any such lending right.

There are, however, two exceptions to this rule. They relate to the rental for profit of either a phonorecord embodying a copyrighted sound recording of music or a copy of a copyrighted computer program. Congress concluded in 1984 that the newly emerging “record rental store” was being used by consumers as an inexpensive supplier of musical sound recordings that could be inexpensively taped at home, thus substituting for a purchase of the recording. Comparable conclusions were reached in 1990 with respect to the rental of computer software, which was also susceptible to reproduction for nonprofit personal use, by individuals on their home computers. In the Record Rental Amendment of 1984 and the Computer Software Rental Amendments Act of 1990, Congress forbade the owner of a phonorecord or the possessor of a copy of a computer program “for the purposes of direct or indirect commercial advantage, [to] dispose of, or authorize the disposal of, the possession of that phonorecord or computer program . . . by rental, lease, or lending, or by any other act or practice in the nature of rental, lease, or lending.” These exceptions to the first-sale doctrine are codified in section 109(b) of the Copyright Act. Explicitly excluded from the ban is the not-for-profit rental, lease, or lending of phonorecords or computer software by most nonprofit libraries and educational institutions.

The Right of Public Performance[edit | edit source]

Another exclusive right under section 106 of the Copyright Act is the right “to perform the copyrighted work publicly.” The publicperformance right is a particularly significant right for dramatic works, motion pictures, and musical works. But it is accorded to all categories of copyright-protected works except for pictorial, graphic, and sculptural works (for obvious reasons) and sound recordings (soundengineered performances captured on phonorecords). The exclusion of sound recordings from section 106(4) is largely for historical reasons; although music has had public-performance rights in the U.S. since the turn of the twentieth century, our copyright law was slow to recognize original authorship in recorded performances and gave no protection to sound recordings at all until 1971 and then only against direct “dubbing” or piracy of the recorded sounds. Thus, even today, when a song recording is broadcast over the air on the radio, or is played by a disk jockey in a nightclub, that is potentially a copyright infringement of the song, but it is not an infringement of the sound recording; the songwriter (or other copyright owner in the song) can claim a royalty, but neither the record company nor the recording artist can. As will be discussed below, however, Congress in 1995 added section 106(6) to the Copyright Act, which accords to the copyright owner of a sound recording (typically the recording company) the exclusive right “to perform the work publicly by means of a digital audio transmission”; this is a right that has become highly important in the age of the Internet.

Performance[edit | edit source]

Section 101 sets forth broad definitions of “perform” and “publicly.”

To “perform” a work means to recite, render, play, dance, or act it, either directly or by means of any device or process or, in the case of a motion picture or other audiovisual work, to show its images in any sequence or to make the sounds accompanying it audible.

To perform or display a work “publicly” means—

  1. to perform or display it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered;
  2. to transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times.

The definition of “perform” embraces not only live face-to-face performances but also “rendering” a work by any device or process, such as a compact disk player for music and a DVD player for motion pictures, as well as by radio or television transmission. The definitive House Committee Report states that a performance can be effected through “all kinds of equipment for reproducing or amplifying sounds or visual images, any sort of transmitting apparatus, any type of electronic retrieval system, and any other techniques and systems not yet in use or even invented.”[53] Just as a live dramatic production constitutes a “performance” of the work, as does its broadcast on television, the theater exhibition of a motion picture (which “shows its images in . . . sequence”) also constitutes a “performance” that if unauthorized will infringe the copyright.

Because of the breadth of the definition of “perform,” the television broadcast of a singer’s rendition of a copyrighted song will give rise to a multiple series of “performances.” As is stated in the House Report:

[A] singer is performing when he or she sings a song; a broadcasting network is performing when it transmits his or her performance (whether simultaneously or from records); a local broadcaster is performing when it transmits the network broadcast; a cable television system is performing when it retransmits the broadcast to its subscribers; and any individual is performing whenever he or she plays a phonorecord embodying the performance or communicates the performance by turning on a receiving set.[54]

The private set-owner, although a “performer” of the broadcast song, would not normally be liable for infringement, because his or her performance would not be “public.”

Public performance[edit | edit source]

Of course, to infringe, section 106(4) provides that the performance must be “public.” The definition of that word in section 101 is designed to dispel the confusion that had arisen under the 1909 Act, which had left the word undefined. As stated in the House Report: “[P]erformances in ‘semipublic’ places such as clubs, lodges, factories, summer camps, and schools are ‘public performances’ subject to copyright control. . . . Routine meetings of businesses and governmental personnel would be excluded because they do not represent the gathering of a ‘substantial number of persons.’”[55] Performances that take place at any of the former venues are, in the words of the statute, “at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered.”

The definition in section 101 also makes it clear that a transmitted performance is “public” even though the recipients are themselves located in private settings, such as their own homes or hotel rooms. (Under another definition in section 101, to “transmit” a performance is “to communicate it by any device or process whereby images or sounds are received beyond the place from which they are sent.”) A public performance thus takes place when a work is transmitted by radio or television, or to a computer over the Internet.

Although Congress took pains to define words like “public” with great care and detail, there will inevitably be a need for judicial interpretation. An example is the performance held “at a place open to the public.” The Court of Appeals for the Third Circuit has held that copyright in motion pictures was infringed by a business that invited members of the public to rent videotapes (lawfully made and purchased) and then to view them in rooms provided under the same roof for very small groups of family or friends.[56] The court concluded that the showings in even the small rooms were “public,” and that the defendant store had “authorized” those public performances and thus infringed. A different outcome was reached, however, by the Court of Appeals for the Ninth Circuit in the case of a motel that rented videocassettes for viewing in private guest rooms; the motel was deemed to be facilitating a number of discrete private performances.[57]

The right of public performance is more broadly written than had been the case under the 1909 Copyright Act. Under the earlier statute, the exclusive right to perform music had been limited to public performances “for profit.” Accordingly, performances of copyrighted music in schools, in public parks, at charitable events, and the like were not infringements and generated no royalties for the copyright owner. Performances of copyrighted dramatic works would infringe, if in public, regardless whether or not they were “for profit.” This distinction between dramatic and musical works was abandoned in the definition of exclusive rights under the 1976 Copyright Act; section 106(4) eliminates the “for profit” limitation upon the music performance right. Nonetheless, the present statute provides certain specific exemptions for public performances of music that do not obtain for public performances of dramatic works; these exemptions will be explored below. Conspicuously omitted from the section 106(4) exclusive right of public performance is the “sound recording,” which is the work created through the combined creative efforts of performing artists and recording company—as distinguished from the “musical work,” which does get the benefit of the public-performance right. Thus, when a musical recording is played on the radio, licenses must be secured from and royalties paid to the owner of copyright in the song, but not to the owner of copyright in the sound recording. This differentiation is more a matter of historical development than anything else.

But in the 1990s, with the widespread development of digital media for storing and transmitting music, Congress concluded that recording artists and companies should be compensated for uses that would likely displace the purchase of conventional recordings. In 1995, Congress thus added to the Copyright Act section 106(6), which gives the exclusive right “in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.” Initially, this provided compensation for the playing of recordings on digital home subscription services akin to cable-television services, but an even greater potential source of revenue became evident as home computers, powered by the Internet, came more widely to be used to listen to music (and potentially to substitute for record purchases). Congress in 1998, as part of the Digital Millennium Copyright Act, saw the need for further articulation of policy concerning the digital transmission of music on the Internet (“nonsubscription transmission”), and many of these transmissions are allowed subject to a compulsory license, spelled out in complex detail in section 114. Compulsory licenses are discussed in Fair Use and Other Exemptions from the Exclusive Rights of the Copyright Owner.

Performing rights societies[edit | edit source]

It is obvious that the owners of copyright in, say, a popular song cannot personally monitor, license, and collect royalties from the potentially vast number of public performances of their music—in live nightclub and restaurant performances, in jukebox plays, in radio and television broadcasts, in music subscription services such as Muzak, in supermarkets and production plants, on college campuses, in “streamed” music programs on the Internet, in motion picture theaters from film soundtracks, and the like. The owners of musical copyright (songwriters and their assignees, music publishers) have formed socalled performing rights societies to do so. The first such society in the United States, ASCAP (American Society of Composers, Authors and Publishers), was formed in 1914 by eminent American composers including Victor Herbert and John Philip Sousa. The other major performing rights societies are BMI (Broadcast Music, Inc.), formed in 1939, and SESAC (formerly, Society of European Stage Authors and Composers). Technically, these societies serve as nonexclusive licensees, which in turn license others (principally entertainment venues and broadcasters) pursuant to standard royalty arrangements the terms of which are regulated by antitrust decrees. Suits for infringement, brought in the name of the copyright owner, are typically managed by representatives of the performing rights societies. Public-performance royalties collected by these societies total about $1.5 billion per year and are distributed to their members according to elaborate formulas.

Section 116 of the Copyright Act explicitly recognizes these societies and assigns them a role in the distribution of royalties generated by jukebox performances of recorded music.

The Right of Public Display[edit | edit source]

Under the 1909 Act, it was unclear how to treat the public display of copyrighted works (e.g., the showing of a painting, sculpture, or literary manuscript on television). This form of exploitation did not fit comfortably within the statutory terms “copy” and “performance.” Congress dispelled the uncertainty by providing in section 106(5) of the 1976 Copyright Act for the exclusive right “to display the copyrighted work publicly.” This right applies to all copyrighted works except for sound recordings (for obvious reasons); the showing of a motion picture or other audiovisual work is treated as a “performance,” but the showing of “individual images of a motion picture or other audiovisual work” falls within the display right.

Section 101 defines the “display” of a work as the showing of “a copy of it, either directly or by means of a film, slide, television image, or any other device or process or, in the case of a motion picture or other audiovisual work, to show individual images nonsequentially.” The “public” display of a work is defined in precisely the same manner as the public performance of a work. Thus, to show a painting or sculpture on a television broadcast is a public display of the work, which must be authorized in order to avoid infringement. The public-display right of the copyright owner has taken on added significance with the development of the Internet. If, for example, a copyright-protected work of art is incorporated on a website, so that the accessing of that site by any Internet user produces an image of that artwork on a computer monitor, this constitutes a public display, which if unauthorized will infringe. (The same is true for the text of a literary work.) A number of courts have held that the unauthorized scanning of a copyrighted picture from a magazine, and its resulting conversion into digital form for storage on a computer hard-drive—an infringing “reproduction”—will generate an infringing public display when that image is made available by “uploading” over the Internet (on a website or bulletin board) to persons who can then view and download the image on their computer (whether or not they make their own hardcopy at the receiving end).[58]

Were the language of section 106(5) not conditioned in any way, the owner of a copyrighted work of art would infringe by displaying the work in a public exhibition space—or even by holding it up in a classroom or other public gathering. Just as Congress’s concern about private ownership of material objects has counterbalanced the right of “public distribution” through the first-sale doctrine, so too has Congress decided to limit the newly created public-display right by a specific exemption for the owner of the physical object in which the copyrighted work is embodied. Section 109(c) provides:

Notwithstanding the provisions of section 106(5), the owner of a particular copy lawfully made under this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to display that copy publicly, either directly or by the projection of no more than one image at a time, to viewers present at the place where the copy is located.

Thus, a face-to-face display by the owner of a copy of a copyrighted work to a public gathering will not infringe; nor will the use of a projection device to throw an image of the work onto a screen. If, however, the display is by closed-circuit television with the work in one location and the viewers in another, or if the display is by multiple television screens or computer monitors to facilitate closer audience viewing, the exemption in section 109(c) will not obtain, and the unauthorized display will constitute an infringement. This fine line reflects Congress’s desire to protect the copyright interest of the artist against the incursion of new technological developments that may threaten to displace the artist’s market for individual copies (with attendant dilution of royalty rights).

Visual Artists’ Rights[edit | edit source]

In the Visual Artists Rights Act (VARA) of 1990, Congress amended the Copyright Act to give to an “author of a work of visual art” rights that are different from those given to a copyright owner. These are the rights of “attribution and integrity” and are equivalent to those “moral rights” recognized in most civil-law nations as well as in the Berne Convention.

These statutory rights are accorded by section 106A to persons who, under the definition of “work of visual art”[59] in section 101 of the Copyright Act, create singular paintings, sculptures, or photographs produced for exhibition only, or such works in a signed and numbered series of no more than 200.

The “right of attribution” entitles a visual artist to “claim authorship” of a work of visual art, and to prevent the use of his or her name as author of a work created by another or as author of his or her own work in distorted or mutilated form. The artist could, for example, secure an injunction directing a museum to identify a displayed work as her own (rather than misattributing it to another artist), or money damages for harm to her reputation that results from attributing to her a physically mangled canvas or sculpture.

The “right of integrity” entitles the visual artist “to prevent any intentional distortion, mutilation, or other modification of that work which would be prejudicial to his or her honor or reputation.” If, for example, an artist produces a three-segment painting, and a purchaser of that painting separates the three segments in an effort to maximize the proceeds of resale (or simply for display in three separate locations), the artist has a claim for copyright infringement provided she can prove that there has been prejudice to her reputation. Section 106A—as part of the right of integrity—also bars the intentional or grossly negligent “destruction of a work of recognized stature.” (The latter term is not defined, although its content was delineated in earlier versions of the legislation.)

The 1990 amendments also added a new section 113(d) to deal with the removal of works of visual art that are incorporated into buildings, such as murals or fixed statuary.

The Visual Artists Rights Act excludes from infringement the modification or distortion of a work that results from the “passage of time or the inherent nature of the materials” or that results from conservation efforts (unless grossly negligent) or from the lighting or placement of the work in a public exhibition. Perhaps most important, the statute expressly excludes from its ban alleged distortions or mutilations that take the form of “any reproduction, depiction, portrayal, or other use of a work” in books, magazines, newspapers, posters, advertising material, motion pictures and other forms set forth in sections 101 and 106A(c)(3). In other words, it is the physical integrity of the singular work of art that is protected, and not its use in discolored or badly cropped reproductions. (Such reproductions might, however, be barred by the copyright owner as unauthorized derivative works prepared in violation of section 106(2).)

Because a “work of visual art” is a category that fits within the larger category of “pictorial, graphic and sculptural work,” a case could arise in which an artist’s right of integrity conflicts with the rights of a copyright owner to create a derivative work under section 106(2). Thus, if in the hypothetical set forth above, the artist of a three-segment painting were to transfer both the physical property and the copyright in that painting to another, the copyright owner’s claim to separate the segments—and thus to create “derivative works”—could presumably be defeated by the artist’s claim under section 106A that such action constitutes an infringing distortion, mutilation, or modification. The 1990 amendments do not expressly deal with this possible clash of equivalent statutory rights.

Under section 106A(d)(2), the protections of VARA are not afforded to works created (i.e., fixed in a tangible medium) before the effective date of that Act, June 1, 1991, unless the title to such work was not as of that date transferred from the artist.[60]

Secondary Liability: Contributory and Vicarious Infringement[edit | edit source]

A copyright owner may bring infringement actions not only against the person actually engaging in the unauthorized exercise of one of the exclusive rights in section 106, but also against “contributory” and “vicarious” infringers. The Copyright Act makes no specific provision for thus extending the range of liability, but these doctrines have been a part of our copyright jurisprudence for many decades.[61] Courts have come only fairly recently to articulate the differences between the two theories of secondary liability—and both theories are being increasingly invoked by plaintiffs in infringement cases, particularly when it would be costly and complicated to proceed against a host of direct infringers, as is the situation with Internet copying.

The Supreme Court endorsed and applied the law of contributory copyright liability in Sony Corp. of America v. Universal City Studios, Inc.[62] The plaintiff film studio contended that the manufacturer– distributor of a popular brand of videotape recorder was responsible for contributory infringement, based on the direct infringement allegedly committed by the home-taper. The Court, in effect, concluded that even though contributory liability is not mentioned in the Copyright Act (unlike the specific provision therefor in the patent statute[63]), it is encompassed within section 106, which gives the copyright owner the exclusive right not only to make copies but “to authorize” others to make copies. Moreover, contributory liability is akin to such liability in tort cases more generally, which treat a person who knowingly participates in or furthers a tortious act as jointly and severally liable with the primary tortfeasor. The Court essentially endorsed the definition contained in an earlier and still frequently cited decision of the Court of Appeals for the Second Circuit: “[O]ne who, with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another, may be held liable as a ‘contributory’ infringer.”[64]

The Supreme Court in Sony cautioned, however, that the manufacturers and sellers of videotape machines could not be liable merely because they had constructive knowledge that their purchasers might use the equipment to make infringing copies. Borrowing from the socalled “staple article” exception in patent law,[65] the Court held that selling the videotape recorders would not constitute contributory infringement “if the product is widely used for legitimate, unobjectionable purposes. Indeed it need merely be capable of substantial noninfringing uses.”[66] Because many copyright owners of television programs do not object to home videotaping, and because even unauthorized home videotaping, for time-shifting purposes, is a fair use, the Court concluded that “the Betamax is, therefore, capable of substantial noninfringing uses. Sony’s sale of such equipment to the general public does not constitute contributory infringement of respondents’ copyrights.”[67]

Vicarious liability, on the other hand, can be imposed on persons who do not “induce, cause or materially contribute to” direct infringement or indeed who do not even know that another is involved in infringing activity. Again, as in the law of torts generally, vicarious copyright liability can be imposed on the basis of principles akin to those underpinning so-called “enterprise liability,” as exemplified in the doctrine of respondeat superior. In a seminal case on the issue, Shapiro, Bernstein & Co. v. H.L. Green Co., the Court of Appeals for the Second Circuit held:

When the right and ability to supervise coalesce with an obvious and direct financial interest in the exploitation of copyrighted materials—even in the absence of actual knowledge that the copyright monopoly is being impaired—the purposes of copyright law may be best effectuated by the imposition of liability upon the beneficiary of that exploitation.[68]

In that case, the court imposed liability for the sales of unlawfully made phonograph records upon the proprietor of a department store, as well as upon the record concessionaire actually doing the selling within the store; the store owner had the right to supervise the concessionaire and to share in its gross receipts from the sale of records.[69]

These two theories of secondary liability were brought to bear in an influential decision of the Court of Appeals for the Ninth Circuit, Fonovisa, Inc. v. Cherry Auction, Inc.[70] The plaintiff held copyrights in Hispanic music recordings, and claimed infringement on the part of the operators of a flea market (or “swap meet”) where third-party vendors routinely sold counterfeit recordings. The vendors rented space for their booths, and Cherry Auction advertised, supplied parking and refreshments (from which it derived income, to add to its admissions fees), and retained the right to exclude any vendor for any reason. The trial court had dismissed the complaint, but the court of appeals viewed the allegations as sufficient to sustain secondary-infringement claims. After a thorough review of the precedents, the court of appeals held that Cherry Auction would be vicariously liable for the vendors’ directly infringing record sales, because through its right to terminate vendors it had the ability to control their activities, and because it reaped “substantial financial benefits from admission fees, concession stand sales and parking fees, all of which flow directly from customers who want to buy the counterfeit recordings at bargain basement prices.”[71] The court also found sufficient allegations of contributory infringement because Cherry Auction allegedly knew of the directly infringing sales and because it provided the “site and facilities” (i.e., space, utilities, parking, advertising, plumbing and customers) for those infringements.

It was only a matter of time before these principles and precedents were applied so as to determine whether there was secondary infringement on the part of website operators—such as Napster, StreamCast, and Grokster—that have provided file-sharing software that can be used to facilitate the unauthorized exchange of music recordings on the Internet. The first important decision was that of the Court of Appeals for the Ninth Circuit in A & M Records, Inc. v. Napster, Inc.[72] There the court concluded that individual Napster users were infringing (by duplicating and distributing copyright-protected music and recordings) and were not engaging in fair use, and that Napster, Inc. was secondarily liable. There was contributory infringement: “Napster has actual knowledge that specific infringing material is available using its system, that it could block access to the system by suppliers of the infringing material, and that it failed to remove the material,”[73] and Napster provided the “site and facilities” to assist finding and downloading the recordings. As for vicarious infringement, Napster had the ability to locate infringing material on its search indices and the right to terminate users’ access to the system; it also derived ever-increasing advertising revenues as more users were drawn to its website through the appeal of the infringing music.[74]

The same court, the Ninth Circuit, reached a different conclusion—neither contributory nor vicarious infringement—in a later case involving the Grokster software, which created a more decentralized file-sharing network than in Napster, allowing the defendants to “step aside,” as it were, and to let the music-file swappers do so directly, without going through a centralized server and indexer. When the case reached the Supreme Court, the respondent companies invoked the Sony decision and sought to prove that their software was capable of substantial noninfringing uses, for example, the swapping of uncopyrighted material.

In Metro-Goldwyn-Mayer Studios Inc. v. Grokster Ltd.,[75] however, the Supreme Court reversed, while declining to determine how the Sony “substantial noninfringing use” test would apply in the case before it.[76] Rather, the Court—buttressed by the Patent Act provision imposing liability upon “[w]hoever actively induces infringement”[77]— held instead that “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.”[78] Although one could not infer from Sony’s sale of its Betamax videotape recorder, without more, that it knew of substantial infringement by users, there was no doubt of that with Grokster, whose business plan and advertising were explicitly designed to encourage unlawful private copying, particularly by those who had been forced to leave Napster as a result of the adverse judgment against it in the Ninth Circuit. The Court rejected the defendants’ contention that a finding of secondary liability would significantly interfere with the development of new electronic technologies: “The inducement rule . . . premises liability on purposeful, culpable expression and conduct, and thus does nothing to compromise legitimate commerce or discourage innovation having a lawful promise.”[79]

Issues of secondary copyright infringement are also raised when the defendant is one step more removed from the direct infringement than in the cases just discussed—in which the defendants consciously designed and distributed software that was used, and was largely meant to be used, to make illicit copies and phonorecords. What, if any, liability is there, on the part of Internet service providers (ISPs)—such as AOL and, increasingly, telephone and cable companies—that allow home computer users to connect to the Internet and to post and exchange all manner of potentially copyright-protected materials? These ISPs provide an appealing target for copyright infringement lawsuits, when the alternative would often be cumbersome suits against individuals.

The solution to this question has been provided partly by the federal courts and partly by Congress. Perhaps the most influential court decision is Religious Technology Center v. Netcom On-Line Communication Services, Inc.[80] The plaintiff, a unit within the Church of Scientology, finding that a disgruntled former member, Erlich, had posted certain unpublished Church documents on an online “bulletin board,” brought a copyright infringement action against the operator of the bulletin board and the ISP that provided online access to the bulletin board and to the Internet more generally. The court held that the ISP (Netcom) could be liable as a contributory infringer if, after receiving a “take-down notice” from the Church, it could reasonably have known of the copyright-protected status of the posted documents, and it allowed the messages to remain on its system and to be further distributed to servers worldwide. The court also found, with respect to vicarious liability, that Netcom had a history of policing its users’ postings and suspending some (for obscenity, commercial advertising and the like); but that it derived no economic benefits from Erlich’s infringement.

Although the Netcom case and others like it exonerated ISPs from direct liability when they acted as “mere conduits” for Internet communications, the prospect of even indirect liability for contributory infringement spurred service providers to lobby Congress for exemptions from copyright liability and remedies. In 1998 Congress passed the Digital Millennium Copyright Act (DMCA), which added section 512 to the Copyright Act.[81] That section adjusted the risks of copyright owners and service providers so as to place the burden on the former to identify and notify “mere conduit” service providers of infringements carried by or residing on the providers’ systems. By contrast, the law makes no special provision for service providers who originate or are otherwise actively implicated in the content residing on their servers or transiting through their systems.

Section 512 of the Copyright Act does not purport to define the conduct of an ISP that would render it liable for direct, contributory or vicarious infringement; rather, it identifies several different ISP activities and specifies conditions for immunizing the ISP against monetary relief and for limiting its exposure to injunctive relief. Section 512 distinguishes, for example, the “mere conduit” from the ISP that stores on its network allegedly infringing material for more than several days (e.g., by providing server space for a user’s website). The former is given immunity from monetary liability in most instances, while the latter is susceptible to “take-down notices”[82] from copyright owners and an obligation under stipulated circumstances to remove the allegedly offending material from its network. Section 512 is intricate and requires patient reading.

References[edit | edit source]

  1. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 435 & n.17 (1984) (manufacturer-seller of videotape recorder is not contributorily liable for home taping of copyrighted television programs, which is fair use under the circumstances). See Columbia Pictures Indus. v. Aveco, Inc., 800 F.3d 59 (3d Cir. 1986). For more recent developments concerning secondary infringement, see Exclusive Rights of the Copyright Owner § Secondary Liability: Contributory and Vicarious Infringement.
  2. Pasha Publ’ns, Inc. v. Enmark Gas Corp., 22 U.S.P.Q.2d 1076 (N.D. Tex. 1992).
  3. Playboy Enters., Inc. v. Webbworld, Inc., 991 F. Supp. 543 (N.D. Tex. 1997); Phillips v. Kidsoft, L.L.C., 52 U.S.P.Q.2d 1102 (D. Md. 1999).
  4. 125 S. Ct. 2764 (2005).
  5. BMG Music v. Gonzalez, 430 F.3d 888 (7th Cir. 2005) (finding infringement in unauthorized downloading of more than 1,300 songs, despite defendant’s claim of fair use). See also A & M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).
  6. See 17 U.S.C. §§ 117(a), (c); MAI Sys. Corp. v. Peak Computer, Inc., 991 F.2d 511 (9th Cir. 1993).
  7. 154 F.2d 464 (2d Cir. 1946).
  8. Id. at 468.
  9. Feist Publ’ns, Inc. v. Rural Tel. Serv., 499 U.S. 340 (1991). See generally Positive Black Talk Inc. v. Cash Money Records Inc., 394 F.3d 357 (5th Cir. 2004), and Laureyssens v. Idea Group, Inc., 964 F.2d 131 (2d Cir. 1992), for thoughtful discussions of “probative similarity” and its implications.
  10. Ty, Inc. v. GMA Accessories, Inc., 132 F.3d 1167 (7th Cir. 1997).
  11. Arnstein, 154 F.2d at 468.
  12. Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487 (2d Cir. 1960). See also Steinberg v. Columbia Pictures Indus., Inc., 663 F. Supp. 706 (S.D.N.Y. 1987).
  13. Dawson v. Hinshaw Music, Inc., 905 F.2d 731 (4th Cir. 1990) (religious musical arrangement); Lyons P’ship, L.P. v. Morris Costumers, Inc., 243 F.3d 789 (4th Cir. 2001) (animal costumes purchased by adults for the entertainment of children).
  14. Other courts have sometimes utilized a different form of two-step infringement analysis, involving the application of so-called extrinsic and intrinsic tests. The source of that approach is Sid & Marty Krofft Television Productions, Inc. v. McDonald’s Corp., 562 F.2d 1157 (9th Cir. 1977). This test is rather confusing and misleading, has been applied inconsistently, and in any event largely reduces itself to an analysis very much like that in Arnstein.
  15. See Ringgold v. Black Entertainment Television, Inc., 126 F.3d 70 (2d Cir. 1997), for a thorough discussion of the variant uses of the de minimis doctrine in copyright.
  16. Newton v. Diamond, 349 F.3d 591 (9th Cir. 2003). But see Bridgeport Music, Inc. v. Dimension Films, 410 F.3d 792 (6th Cir. 2005) (de minimis doctrine inapplicable to sampling of music recordings).
  17. See Feist Publ’ns, Inc. v. Rural Tel. Serv., 499 U.S. 340 (1991).
  18. Id. at 350.
  19. De Acosta v. Brown, 146 F.2d 408 (2d Cir. 1944).
  20. Bright Tunes Music Corp. v. Harrisongs Music, Ltd., 420 F. Supp. 177 (S.D.N.Y. 1976).
  21. Id. at 181. See also Three Boys Music Corp. v. Bolton, 212 F.3d 477 (9th Cir. 2000). The principle of “subconscious infringement” was endorsed by Learned Hand in Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49 (2d Cir. 1936), perhaps as a means of avoiding a finding that the defendant’s executives had been less than truthful when denying copying.
  22. Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487 (2d Cir. 1960).
  23. Nichols v. Universal Pictures Corp., 45 F.2d 119, 121 (2d Cir. 1930).
  24. Id. at 122.
  25. Narell v. Freeman, 872 F.2d 907 (9th Cir. 1989); Hoehling v. Universal City Studios, Inc., 618 F.2d 972 (2d Cir. 1980).
  26. But see Mannion v. Coors Brewing Co., 377 F. Supp. 2d 444 (S.D.N.Y. 2005) (finding the dichotomy inapplicable to photographic works).
  27. Herbert Rosenthal Jewelry Corp. v. Kalpakian, 446 F.2d 738, 742 (9th Cir. 1971).
  28. 81 F.2d 49 (2d Cir. 1936).
  29. See Sega Enters., Ltd. v. Accolade, Inc., 977 F.2d 1510 (9th Cir. 1992) (decompiling computer code creates a copy that technically infringes, even though only an “intermediate” copy, but under the circumstances of the case was privileged as a “fair use”).
  30. 982 F.2d 693 (2d Cir. 1992).
  31. Id. at 707.
  32. Id.
  33. Id. at 710.
  34. Compare Apple Computer, Inc. v. Microsoft Corp., 779 F. Supp. 133 (N.D. Cal. 1991).
  35. 17 U.S.C. § 115(c)(2).
  36. See Newton v. Diamond, 349 F.3d 591 (9th Cir. 2003).
  37. Compare Williams v. Broadus, 60 U.S.P.Q.2d 1051 (S.D.N.Y. 2001) (question of fact whether sampling 2 of 54 musical measures, consisting of opening 10 notes, is substantial copying), with Bridgeport Music, Inc. v. Dimension Films, 410 F.3d 792 (6th Cir. 2005) (announcing a “bright line” test making all sampling unlawful, and de minimis standard inapplicable).
  38. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984).
  39. 17 U.S.C. §§ 1001–1010.
  40. Id. §§ 1003–1007. See also Recording Indus. Ass’n of Am. v. Diamond Multimedia Sys., Inc., 180 F.3d 1072 (9th Cir. 1999) (holding that hand-held digital devices that store music recordings transferred from computer hard-drives are not the sort of devices (“digital audio recording device”) for which royalties must be paid).
  41. Kalem Co. v. Harper Bros., 222 U.S. 55 (1911).
  42. Horgan v. MacMillan, Inc., 789 F.2d 157 (2d Cir. 1986).
  43. 538 F.2d 14 (2d Cir. 1976).
  44. Compare Mirage Editions, Inc. v. Albuquerque A.R.T. Co., 856 F.2d 1341 (9th Cir. 1988), with Lee v. A.R.T. Co., 125 F.3d 580 (7th Cir. 1997). A district court within the Ninth Circuit has indeed held that what is essentially mere framing of an artwork constitutes the unlawful creation of a derivative work. Greenwich Workshop, Inc. v. Timber Creations, Inc., 932 F. Supp. 1210 (C.D. Cal. 1996).
  45. Futuredontics, Inc. v. Applied Anagramics, Inc., 45 U.S.P.Q.2d 2005 (C.D. Cal.).
  46. Columbia Pictures Indus., Inc. v. Garcia, 996 F. Supp. 770 (N.D. Ill. 1998).
  47. E.g., Playboy Enters., Inc. v. Webbworld, Inc., 991 F. Supp. 543 (N.D. Tex. 1997) (website operator “distributes” copyright-protected works “by allowing its users to download and print copies of electronic image files”).
  48. Religious Tech. Ctr. v. Netcom On-Line Communication Servs., Inc., 907 F. Supp. 1361 (N.D. Cal. 1995). The liability of internet service providers for contributory and vicarious liability is a matter of detailed regulation under section 512 of the Copyright Act, added in 1998.
  49. 210 U.S. 339, 350 (1908).
  50. Fawcett Publ’ns, Inc. v. Elliot Publ’g Co., 46 F. Supp. 717 (S.D.N.Y. 1942).
  51. Nat’l Geographic Soc’y v. Classified Geographic, Inc., 27 F. Supp. 655 (D. Mass.).
  52. 523 U.S. 135 (1998).
  53. H.R. Rep. No. 94-1476, at 63 (1976).
  54. Id.
  55. Id. at 64.
  56. Columbia Pictures Indus., Inc. v. Aveco, Inc., 800 F.2d 59 (3d Cir. 1986).
  57. Columbia Pictures Indus., Inc. v. Prof’l Real Estate Investors, Inc., 866 F.2d 278 (9th Cir. 1989).
  58. Playboy Enters., Inc. v. Webbworld, Inc., 991 F. Supp. 543 (N.D. Tex. 1997); Playboy Enters., Inc. v. Frena, 839 F. Supp. 1552 (M.D. Fla. 1993).
  59. The definition is narrowly drawn, and excludes inter alia “advertising.” See Pollara v. Seymour, 344 F.3d 265 (2d Cir. 2003).
  60. See Pavia v. 1120 Ave. of the Americas Assocs., 901 F. Supp. 620 (S.D.N.Y. 1995) (work was created, title was transferred, and work was dismantled without authorization, all before June 1991; its continued display in that condition after June 1991 was held not to violate VARA).
  61. See, e.g., Polygram Int’l Publ’g, Inc. v. Nevada/TIG, Inc., 855 F. Supp. 1314 (D. Mass. 1994); Demetriades v. Kaufmann, 690 F. Supp. 289 (S.D.N.Y. 1988).
  62. 464 U.S. 417 (1984).
  63. See 35 U.S.C. §§ 271(b), (c).
  64. Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971).
  65. 35 U.S.C. § 271(c).
  66. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 442 (1984).
  67. Id. at 456.
  68. Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d 304, 307 (2d Cir. 1963).
  69. In an effort to apply or extend the principle of vicarious liability (often with a view toward finding more solvent defendants), plaintiffs have named as defendants such entities as radio stations on which allegedly pirated merchandise is advertised, as well as sponsors of allegedly infringing broadcasts. See Screen Gems-Columbia Music, Inc. v. Mark-Fi Records, Inc., 256 F. Supp. 399 (S.D.N.Y. 1966) (advertising agency); Davis v. E.I. DuPont de Nemours & Co., 240 F. Supp. 612 (S.D.N.Y. 1965) (sponsor of television show and its advertising agency).
  70. 76 F.3d 259 (9th Cir. 1996). See also Arista Records, Inc. v. Flea World, Inc., 2006 WL 842883 (D.N.J. 2006).
  71. Id. at 263.
  72. 239 F.3d 1004 (9th Cir. 2001).
  73. Id. at 1022.
  74. In a later case in which the defendant’s file-sharing technology was somewhat different, the Seventh Circuit reached essentially the same conclusion concerning contributory liability as did the Napster court, and reserved judgment on the question of vicarious liability. In re Aimster Copyright Litig., 334 F.3d 643 (7th Cir. 2003).
  75. 125 S. Ct. 2764 (2005).
  76. Six Justices who joined in the unanimous Court opinion did, however, opine as to how the Sony test would apply on the record before them, with three finding contributory liability and three finding none.
  77. 35 U.S.C. § 271(b).
  78. Grokster, 125 S. Ct. at 2770.
  79. Id. at 2780.
  80. 907 F. Supp. 1361 (N.D. Cal. 1995).
  81. 17 U.S.C. § 512.
  82. See generally Rossi v. Motion Picture Ass’n of Am., 391 F.3d 1000 (9th Cir. 2004); ALS Scan, Inc. v. RemarQ Cmtys., Inc., 239 F.3d 619 (4th Cir. 2001).