MediaLaw Monitor http://www.medialawmonitor.com Media, Technology, and First Amendment Legal Developments from Davis Wright Tremaine Mon, 30 Jan 2017 20:38:59 +0000 en-US hourly 1 https://wordpress.org/?v=4.7.5 The 2016 Roundup of Key California Anti-SLAPP Decisions http://www.medialawmonitor.com/2017/01/the-2016-roundup-of-key-california-anti-slapp-decisions/ Mon, 30 Jan 2017 09:47:22 +0000 http://www.medialawmonitor.com/?p=3210 By Thomas R. Burke

In 2016, the California Supreme Court and the Ninth Circuit Court of Appeals issued important opinions interpreting California’s anti-SLAPP statute (C.C.P. § 425.16 et seq.), once again broadly construing its application. See Baral v. Schnitt, pg. 4 and Sarver v. Chartier, pg. 5. Enacted in 1992, California’s statute remains the strongest—and most frequently litigated—anti-SLAPP statute in the nation for the protection of the exercise of free speech and petitioning activities. In 2016, California’s state and federal appellate courts produced more than two dozen published anti-SLAPP opinions and more than 150 unpublished opinions. As we do every year, we briefly summarize the most significant anti-SLAPP appellate cases decided in 2016.

PRONG ONE: Does the Anti-SLAPP Statute Apply?

California’s anti-SLAPP statute follows a two-step process. In the first step—or “prong one”—the court determines whether the defendant has made a prima facie showing that the challenged cause of action (or plaintiff’s entire complaint) arises from the defendant’s constitutionally protected petitioning or free-speech activity. The statute features four broad categories of activity that constitute “act[s] in furtherance of a person’s right of petition or free speech under the United States or California Constitution in connection with a public issue” and within the protection of the statute. See C.C.P. § 425.16, subd. (e) (1) to (4). The statute is to be “construed broadly.” C.C.P. § 425.16 (a).

In 2016, California’s appellate courts held that the anti-SLAPP statute protected a variety of petitioning and free-speech activities:

Votes by city council members taken after a public hearing qualify as acts in furtherance of constitutionally protected activity. City of Montebello v. Vasquez, 1 Cal. 5th 409, 425-427 (2016) (citing favorably, Schwarzburd v. Kensington Police Protection & Community Services Dist. Bd., 225 Cal. App. 4th 1345, 1353-1355 (2014));

A declaratory relief action brought by three directors of a homeowners association against six other directors and the manager of the association was within the anti-SLAPP statute because the defendant directors’ decision-making process and debate in approving a roofing project for the association “impacted a broad segment, if not all of [the homeowners association’s] members. Lee v. Silveria, 6 Cal. App. 5th 527 (reversing the trial court and granting defendants’ anti-SLAPP motion).

An alleged libel based on a report authored by a business consultant that questioned the accuracy of certain public statements made by the plaintiff, a waste-materials hauler, involved speech in connection with a public issue and subject to the anti-SLAPP statute. Industrial Waste and Debris Box Service, Inc. v. Murphy, 4 Cal. App. 5th 1135 (2016);

Anti-SLAPP protection applied to lawsuit filed against producers and distributors of the film The Hurt Locker, challenging the allegedly unauthorized and false depiction of the plaintiff’s work with improvised explosive devices during the Iraq War. Rejecting plaintiff’s primary reliance on Dyer v. Childress, 147 Cal. App. 4th 1273 (2007), the Ninth Circuit Court of Appeals found that the film’s “focus on the conduct of the Iraq War satisfies California’s standards for determining whether an issue is one of public concern.” Sarver v. Chartier, 813 F.3d 891, 901-902 (9th Cir. 2016). [See related story internally re Sarver v. Chartier.]; and

Similarly, the Second Appellate District in Los Angeles ruled that the anti-SLAPP statute applied to a defamation lawsuit filed against the producers and distributors of the movie American Hustle, based on a brief dialogue reference in the movie to plaintiff, because “the microwave oven scene plainly drew on an issue of public interest in the 1970’s, and plaintiff was an integral part of that issue at the time. Whether we consider the public interest in the movie as a whole—which is conceded and undeniable—or the public interest in the particular topic being discussed in the scene at issue—which likewise existed during the era being depicted—our conclusion remains the same. Defendants’ conduct in writing and broadcasting the microwave oven scene was protected activity within the meaning of the anti-SLAPP statute.” Brodeur v. Atlas Entertainment, Inc., 248 Cal. App. 4th 665, 677-678 (2016).
 

Other actions did not trigger anti-SLAPP protection:

A civil and probate action brought by the beneficiary of a trust against a trustee for breach of fiduciary duty, constructive fraud and conversion was not subject to the anti-SLAPP statute because plaintiff’s claims against the trustee for withdrawing trust funds did not arise from any “oral statement or writing” protected by the statute. Greco v. Greco, 2 Cal. App. 5th 810 (2016);

The public interest in preventing sexual harassment in the workplace did not trigger anti-SLAPP protection where “a single letter written to ban a single firefighter from Cal Fire’s facilities on account of past allegations of harassing a single employee” does not “rise to a public interest under subdivision (e) (4). If it did, discussion of any work place dispute … would qualify as a matter of public interest for purposes of the anti-SLAPP statute, something the Legislature did not design the statute to do.” Baughn v. Dept. of Forestry & Fire Protection, 246 Cal. App. 4th 328, 339 (2016);

In another employment-related lawsuit, retaliation and discrimination claims made by a former state university medical resident were not protected by the anti-SLAPP statute. Nam v. Regents of the University of California, 1 Cal. App. 5th 1176 (2016);

A lawsuit against CNN alleging discrimination, retaliation, wrongful termination, and defamation brought by a former producer and web article writer who did not appear on camera did not involve an issue of public interest and fell outside the scope of the anti-SLAPP statute. Wilson v. Cable News Network, 6 Cal. App. 5th 822 (2016); and,

A confrontation between neighbors that was captured on a cellphone video-recording did not trigger anti-SLAPP protection because defendants “did not present any evidence to establish that [plaintiffs] were anyone other than ‘private, anonymous’ parties or that the dispute was anything other than a private controversy.” Abuemeira v. Stephens, 246 Cal. App. 4th 1291, 1298 (2016). As the court observed: “A video-recording of an unseemly private brawl, no matter how wide its distribution, is far removed from a citizen’s constitutional right of petition or free speech involving a public issue.” Id. at 1294.
 

After years of conflicting appellate court rulings, in Baral v. Schnitt, 1 Cal. 5th 376 (2016), the California Supreme Court resolved how the anti-SLAPP statute applies in “mixed conduct” situations—where a portion of a cause of action involved both conduct that was protected by the anti-SLAPP statute and conduct that was unprotected. The Supreme Court in Baral unanimously determined that an anti-SLAPP motion is available against portions of causes of action that infringe on the defendant’s constitutionally protected petitioning or free-speech activities. See article Baral v. Schnitt, 4.

PRONG Two: Did the Plaintiffs Show a “Probability of Prevailing” on Their Claims?

If the defendant makes a prima facie showing that the plaintiff’s cause of action (or complaint) arises from constitutionally protected petitioning or free-speech activities, then in “prong two,” the burden shifts to the plaintiff to establish with admissible evidence a “probability” of prevailing on the claims challenged by the anti-SLAPP motion.

In 2016, a variety of claims and lawsuits were dismissed in prong two of the anti-SLAPP statute. For example:

Reed v. Gallagher, 248 Cal. App. 4th 841 (2016) (affirming grant of anti-SLAPP motion dismissing libel action brought by a failed candidate for the State Assembly against a competing—and ultimately elected—candidate’s election advertisement because statement that plaintiff was an “unscrupulous” attorney was a non-defamatory opinion; statement that plaintiff was a “crook” was non-defamatory opinion; and the statement that plaintiff had been ordered to pay back attorney fees he improperly collected from an elderly client was not so far removed from the truth as to permit an inference of actual malice);

Karnazes v. Ares, 244 Cal. App. 4th 344 (2016) (anti-SLAPP motion granted dismissing fraud, concealment and promissory estoppel claims brought by an investor against a stockbroker and her attorney because the plaintiff failed to provide any evidence in support of her claims; “pleadings do not constitute evidence”);

County of Riverside v. Public Employment Relations Board, 246 Cal. App. 4th 20 (2016) (anti-SLAPP motion granted dismissing breach of contract and declaratory and injunctive relief action brought by a county because defendant’s acceptance of a public employee union’s request to use advisory fact-finding as a method of resolving a labor impasse, as provided by the Meyers-Milias-Brown Act (Cal. Gov. Code § 3500), did not violate California’s Constitution, article XI, section 11, subdivision (a) because the act’s provisions do not delegate any power to make any binding decisions affecting public agency operations in interference with the county’s home rule powers);

Sarver v. Chartier, 813 F.3d 891 (9th Cir. 2016) (anti-SLAPP motion granted dismissing right of publicity, defamation, false light privacy, intentional infliction of emotional distress, fraud and breach of contract claims brought by army sergeant who alleged that a character in the movie The Hurt Locker was a false and unauthorized depiction of him and his work to dispose of improvised explosive devices during the Iraq War, because, viewed as a whole, the film did not defame Sarver and his depiction in the film would not “highly offend” a reasonable person and was not the result of “extreme” or “outrageous” conduct that induced severe or emotional distress);

Doe 2 v. Superior Court of Los Angeles County, 1 Cal. App. 5th 1300 (2016) (writ granted as a matter of law based on undisputed facts reversing trial court’s order that authorized special discovery in a libel action brought by plaintiff to learn the identity of the author of an anonymous email);

J-M Manufacturing Co., Inc. v. Phillips & Cohen LLP, 247 Cal. App. 4th 87 (2016) (reversing trial court and dismissing trade libel action brought against a law firm for a press release because it was protected by the “fair report” privilege and was nonactionable opinion); and,

Industrial Waste and Debris Box Service, Inc. v. Murphy, 4 Cal. App. 5th 1135 (2016) (reversing trial court and granting anti-SLAPP motion to dismiss libel action based on statements challenged in report about hauler of waste; plaintiff failed to provide evidence in support of its libel claim).
 

Contrastingly, in another instance, plaintiff defeated an anti-SLAPP motion in prong two:

Manzari v. Associated Newspapers Ltd., 830 F.3d 881 (9th Cir. 2016) (anti-SLAPP motion denied in libel action brought by a former pornographic model, who, although deemed a “public figure,” plaintiff showed a reasonable probability of demonstrating “actual malice” and prevailing on her defamation and false-light privacy claims against a news provider after her image appeared in connection with an article about an unidentified pornographic performer’s HIV-positive test results).
 


EXEMPTIONS TO THE ANTI-SLAPP STATUTE 
– When a Lawsuit Is Not Subject to the Statute

There are four situations that are exempted from California’s anti-SLAPP statute: (1) public-enforcement actions; (2) actions filed solely in the public interest; (3) actions involving certain commercial speech; and (4) criminally illegal conduct by the defendant.

The California Supreme Court in City of Montebello v. Vasquez, 1 Cal. 5th 409, 419-420 (2016), reiterated that exemptions to the anti-SLAPP statute are to be narrowly construed to ensure that the anti-SLAPP statute itself remains broadly construed. As the Supreme Court put it: “[E]xpansive interpretation of exemptions from the anti-SLAPP statute is inconsistent with the Legislature’s express intent that the statute’s core provisions ‘shall be construed broadly.’” Id.

Public-Enforcement Actions

In City of Montebello, the Supreme Court reviewed the scope of the “public enforcement” exemption by noting that “the terms of Section 425.16 (d) unambiguously limit the scope of the exemption to enforcement actions brought both ‘in the name of the people of the State of California’ and ‘by the Attorney General, district attorney, or city attorney, acting as a public prosecutor.’ . . . The Legislature’s choice of this specific language reflects its understanding that actions brought in the name of local entities, or by attorneys other than the public officers identified in the statute, are not included in the exemption.” 1 Cal. 5th at 419.

Actions Brought “Solely” in the Public Interest

In Cruz v. City of Culver City, 2 Cal. App. 5th 239 (2016), an anti-SLAPP motion was found not to be exempt from the anti-SLAPP statute under the “public interest” exemption because the plaintiffs’ Brown Act (California’s Open Meetings Law) complaint sought personal relief.

“Commercial Speech” Exemption

In Karnazes v. Ares, 244 Cal. App. 4th 344 (2016), the statute’s so-called “commercial speech” exemption to the anti-SLAPP statute (C.C.P. 425.17 (c)) was not triggered because the challenged statements were made in the context of a lawyer’s representation of their client in pre-litigation negotiations, which did not fit within the narrow exemption.

However, in JAMS, Inc. v. San Diego County Superior Court, 1 Cal. App. 5th 984 (2016), the Court of Appeal expansively interpreted the “commercial speech” exemption to encompass alleged statements of omission or half-truths, a ruling that, absent action by the California Supreme Court, will remain available as intermediate authority for plaintiffs to avoid application of the anti-SLAPP statute because immediate appellate review is unavailable under Section 425.17 (e) once an exemption under Section 425.17 is triggered.

“Criminal Illegality” Exemption

The Supreme Court in City of Montebello, in which the city alleged that the defendant council members alleged illegal conflicts of interest precluded their reliance on the anti-SLAPP statute, revisited the court’s earlier decision in Flatley v. Mauro, 39 Cal. 4th 299, 316-318 (2006) to re-emphasize that it had “made it clear in Flatley that conduct must be illegal as a matter of law to defeat a defendant’s showing of protected activity. The defendant must concede the point, or the evidence conclusively demonstrate it, for a claim of illegality to defeat an anti-SLAPP motion at the first step.” 1 Cal. 5th at 424; see e.g., Reed v. Gallagher, 248 Cal. App. 4th 841, 853 (2016) (failed candidate for the California Assembly who sued a competing candidate for libel failed to satisfy the Flatley criminal-illegality exemption when he claimed that the defendant violated Penal Code Section 115.2 by allegedly displaying a court order with an intent to deceive viewers into believing that there was a legal record that plaintiff was unscrupulous because there was no evidence of malice or intent to deceive).

WHEN AN ANTI-SLAPP MOTION CAN BE BROUGHT

Generally speaking, an anti-SLAPP motion is to be filed within 60 days after service of plaintiff’s complaint. See C.C.P. § 425.16 (g). In Newport Harbor Ventures, LLC v. Morris Cerullo World Evangelism, 6 Cal. App. 5th 1207, the court of appeal approved the filing of an anti-SLAPP motion against two causes of action newly alleged in a third amended complaint, but disallowed as untimely the anti-SLAPP motion as to two other causes of action that had appeared in earlier versions of the complaint but which were not previously challenged with an anti-SLAPP motion. The appellate court held: “Under section 425.16(f), an anti-SLAPP motion is untimely if not filed within 60 days of service of the first complaint that pleads a cause of action coming within anti-SLAPP protection unless the trial court, in its discretion and upon terms it deems proper, permits the motion to be filed at a later time.” Id. at 1211-1212.

USING ANTI-SLAPP MOTIONS IN FEDERAL COURT

Finally, while there is currently a circuit split concerning the viability of anti-SLAPP motions in federal court [compare Abbas v. Foreign Policy Group, LLC, 783 F.3d 1328 (D.C. Cir. 2015) (D.C.’s anti-SLAPP statute not available in federal court) with Makaeff v. Trump University, LLC, 736 F.3d 1180 (9th Cir. 2013) (refusing to reconsider, en banc, the circuit’s anti-SLAPP precedents since 2003 despite a plea by Judge Alex Kozinski)], anti-SLAPP motions remain viable in the Ninth Circuit when the federal court is sitting in diversity or hearing pendent state law claims. See, e.g., Sarver, 813 F.3d at 897, fn. 1; Manzari, 830 F.3d at 886.

In Sarver, the Ninth Circuit also made clear that the “timing controls” [the 30-day and 60-day rules that California’s anti-SLAPP statute provide for the filing and the scheduling of the hearing for an anti-SLAPP motion] imposed by Section 425.16 subdivision (f) of the anti-SLAPP statute “directly collide[s] with the more permissive timeline Rule 56 provides for the filing of a motion for summary judgment.” 813 F.3d at 900-901.

But in Traveler’s Casualty Insurance Co. of America v. Hirsh, 831 F.3d 1179, 1186 (9th Cir. 2016), Judge Alex Kozinski passionately reasserted his objections in Makaeff to hearing anti-SLAPP motions in federal court: “We were wrong in Newsham and Batzel, and wrong not to take Makaeff en banc to reverse them. But it’s not too late to correct these mistakes. Cases like this one have no place on our docket, and we should follow the D.C. Circuit in extirpating them. Our ink and sweat are better spent elsewhere.”

Notwithstanding Judge Kozinski’s continuing objection, for now, in the Ninth Circuit, the denial of an anti-SLAPP motion remains appealable under the collateral order doctrine. “[I]t does not follow, however, that the grant of a motion to strike is as well. The denial of an anti-SLAPP motion to strike is not fully reviewable on appeal after final judgment because the statute provides an important right, ‘immunity from suit’ that would be ‘effectively lost if a case is erroneously permitted to go to trial.’ [citation omitted] No such loss of rights occurs when the review of a grant of an anti-SLAPP motion to strike is delayed until the appeal of final judgment.” Hyan v. Hummer, 825 F.3d 1043, 1047 (9th Cir. 2016).

Thomas R. Burke is a partner in Davis Wright Tremaine LLP’s San Francisco office and is the author of Anti-SLAPP Litigation (The Rutter Group, 2013-2017).

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Baral v. Schnitt: California’s Supreme Court Rules that the Anti-SLAPP Statute Is Available to Strike “Mixed-Conduct” Claims http://www.medialawmonitor.com/2017/01/baral-v-schnitt-californias-supreme-court-rules-that-the-anti-slapp-statute-is-available-to-strike-mixed-conduct-claims/ Fri, 27 Jan 2017 23:42:05 +0000 http://www.medialawmonitor.com/?p=3217 By Thomas R. Burke

In August 2016, the California Supreme Court decided how the state’s anti-SLAPP statute, Cal. C.C.P. § 425.16 et seq., operates in “mixed-conduct” situations—i.e., where a plaintiff’s cause of action combines allegations about a defendant that the statute protects along with allegations of unprotected activity. Baral v. Schnitt, 1 Cal. 5th 376 (2016). California’s anti-SLAPP statute provides that “[a] cause of action against a person arising from any act of that person in furtherance of the person’s right of petition or free speech … shall be subject to a special motion to strike, unless the court determines … there is a probability that the plaintiff will prevail on the claim.”

For over a decade, California’s trial and appellate courts lacked clear guidance on how to handle such “mixed” claim situations. Courts that followed Mann v. Quality Old Time Service, Inc., 120 Cal. App. 4th 90 (2004) (the “Mann” rule), allowed an anti-SLAPP motion only if the plaintiff’s entire cause of action would be dismissed. Other courts permitted a defendant to file an anti-SLAPP motion to dismiss only the discrete portions of a plaintiff’s cause of action that arose from the defendant’s protected activities. This growing split of appellate authority led to anomalous results. Without explicit direction from the state’s Supreme Court, California’s appellate courts and practitioners were left to read tea leaves.

Justice Carol Corrigan, writing for a unanimous court in Baral, evaluated the meaning of the word “cause of action” in the context of the anti-SLAPP statute. “Viewing the term in its statutory context, we conclude that the Legislature used ‘cause of action’ in a particular way in section 425.16 (b)(1), targeting only claims that are based on the conduct protected by the statute.” 1 Cal. 5th at 382. Rejecting the Mann rule, the Supreme Court in Baral unanimously held that the anti-SLAPP statute is available to strike any portion of a cause of action that arises from a defendant’s protected petitioning or free-speech activities regardless of whether the plaintiff’s entire cause of action or claim is dismissed. As the court put it: “Section 425.16 is not concerned with how a complaint is framed, or how the primary right theory might define a cause of action. While an anti-SLAPP motion may challenge any claim for relief founded on allegations of protected activity, it does not reach claims based on unprotected activity.” Id.

The court chose substance over form—ensuring that plaintiffs cannot simply game their complaint and avoid an anti-SLAPP motion by artfully combining alleged protected and unprotected conduct by a defendant. In allowing an anti-SLAPP motion to reach any portions of a plaintiff’s claim that is based on a defendant’s protected activities, the court emphasized the importance of the anti-SLAPP statute’s role in dismissing claims based on protected activity early in litigation. The court explained that “[T]he Mann court’s reading of section 425.16 (b) does not withstand scrutiny. Its refusal to permit anti-SLAPP motions to reach distinct claims within pleaded counts undermines the central purpose of the statute: screening out meritless claims that arise from protected activity, before the defendant is required to undergo the expense and intrusion of discovery.” 1 Cal. 5th at 392. Rather than curb the growing use of the anti-SLAPP statute by litigants, the ruling embraces use of the anti-SLAPP statute against even portions of claims for relief.

Admittedly, how to dissect “mixed-conduct” claims consistently with the anti-SLAPP statute is a topic to which few lawyers quickly warm. Yet the Supreme Court’s unanimous ruling in Baral is vital. Plaintiffs’ ability to artfully draft a complaint will no longer allow them to avoid an anti-SLAPP motion. After all, California’s anti-SLAPP statute is an extremely powerful law: It provides for an early potential dismissal of the plaintiff’s claims, an automatic stay of discovery, an interlocutory appeal if the motion is denied, and mandatory attorneys’ fees if the motion is granted. C.C.P. § 425.16 et. seq. Baral provides explicit guidance that in the typical lawsuit for libel involving challenges to multiple statements from the same publication, an anti-SLAPP motion should be available to strike allegations regarding statements that are not actionable regardless of how the complaint is styled. 1 Cal. 5th at 392-393 (citing to Shiveley v. Bozanich, 31 Cal. 4th 1230, 1242 (2003) [each separate defamatory statement gives rise to a new cause of action]).

Examples of how a plaintiff’s styling of their complaint could avoid the reach of the statute—intentionally or not—underscores Baral’s significance. For example, a libel complaint might be drafted in two different ways. A plaintiff might allege separate causes of action or claims for each of the defendant’s alleged statements or might combine them in one claim. If the defendant’s underlying conduct arose from the exercise of the defendant’s petitioning or free-speech activities, the anti-SLAPP statute would be available. However, the same plaintiff could instead draft the complaint and include allegations of both protected and unprotected conduct by the defendant within the same claim. In that scenario, under the Mann rule, if any portion of the plaintiff’s claims was viable, the anti-SLAPP motion would be denied in its entirety.

Indeed, this is precisely what happened in Mann. An industrial water-systems maintenance company sued two competitors for defamation, trade libel and two related claims after the defendants allegedly made disparaging remarks to the company’s customers and also allegedly falsely reported the corporation’s purported illegal acts to governmental agencies. The defendants’ anti-SLAPP motion was denied because, although the alleged reports to the agencies were protected by the anti-SLAPP statute, their alleged remarks to the plaintiff’s customers were not. The Mann rule arose from this “mixed-conduct” scenario. Because the defendant’s alleged conduct was pled together and the plaintiff was able to demonstrate a probability of prevailing on the allegations about the defendants’ disparaging comments to plaintiff’s customers, the entire anti-SLAPP motion was denied. Mann, 120 Cal. App. 4th at 100-01.

The plaintiff’s efforts to avoid the anti-SLAPP statute in Baral v. Schnitt were far more blatant. The court granted the defendant’s anti-SLAPP motion to defeat claims regarding the creation, publication and refusal to correct an allegedly defamatory audit report. Subsequently, the plaintiff abandoned his appeal of the adverse anti-SLAPP motion ruling and simply realleged the same conduct in an amended complaint under a new paragraph heading that also included conduct that was unprotected by the anti-SLAPP statute. Baral defeated the defendant’s renewed anti-SLAPP motion in the trial court and the court of appeal, rulings that the Supreme Court reversed.

Justice Corrigan offered the following guidance on how lower courts should apply the anti-SLAPP statute in mixed-claims situations post-Baral:

At the first step, the moving defendant bears the burden of identifying all allegations of protected activity, and the claims for relief supported by them. When relief is sought based on allegations of both protected and unprotected activity, the unprotected activity is disregarded at this stage. If the court determines that relief is sought based on allegations arising from activity protected by the statute, the second step is reached. There, the burden shifts to the plaintiff to demonstrate that each challenged claim based on protected activity is legally sufficient and factually substantiated. The court, without resolving evidentiary conflicts, must determine whether the plaintiff’s showing if accepted by the trier of fact, would be sufficient to sustain a favorable judgment. If not, the claim is stricken. Allegations of protected activity supporting the stricken claim are eliminated from the complaint, unless they also support a distinct claim on which the plaintiff has shown a probability of prevailing.

1 Cal. 5th at 396.

The Baral court rejected concerns that defendants would use anti-SLAPP motions to target “fragmentary allegations, no matter how insignificant.” Calling this contention “misplaced,” the court emphasized that allegations in a complaint that are “merely incidental” or “collateral” are not subject to an anti-SLAPP motion. Id. “[A]llegations of protected activity that merely provide context, without supporting a claim for recovery, cannot be stricken under the anti-SLAPP statute.” Id.

As it fashioned its rule for handling “mixed” claims, the court also favorably observed how the Fourth Appellate District in Cho v. Chang, 219 Cal. App. 4th 521 (2013), struck a portion of a plaintiff’s claim using the anti-SLAPP statute while allowing the remainder of the complaint to proceed. Cho offers a practical example of how Baral may apply in practice going forward.

A female employee sued a male co-worker and their employer for sexual harassment and related torts. The co-worker, Cho, then filed a cross-complaint for defamation and intentional infliction of emotional distress against Chang. Cho alleged that Chang had defamed him both in a report that she made to their employer detailing her alleged sexual assault and harassment (which was later the basis of a discrimination claim that she filed with government agencies) and also when speaking with co-workers about Cho’s alleged behavior. This was a classic mixed-conduct case as the cross-complaint combined both protected and unprotected conduct. The appellate court affirmed the trial court’s granting of Chang’s anti-SLAPP motion in part, dismissing only the portion of Cho’s cross-complaint that challenged Chang’s report filed with the state, which the court determined was constitutionally protected petitioning and free-speech activity. The court observed: “[I]t would make little sense if the anti-SLAPP law could be defeated by a pleading … in which several claims are combined into a single cause of action, some alleging protected activity and some not.” Cho, 219 Cal. App. 4th at 526. After all, in such a case, “[s]triking the entire cause of action would plainly be inconsistent with the purposes of the statute,” but “[s]triking the claims that invoke protected activity but allowing those alleging nonprotected activity to remain would defeat none of them.” The appellate court noted that the trial court’s “ruling makes sense, and renders justice to both sides.” Id. at 527.

Some commentators have opined that Baral may prompt an increase in the filing of anti-SLAPP motions—a prospect that critics of the growing popularity of anti-SLAPP motions in the trial and appellate courts will not relish. However, the California Supreme Court’s unanimous ruling in Baral—combined with its opinion issued one week later in City of Montebello v. Vasquez, 1 Cal. 5th 409, 419-420 (2016) (“[E]xpansive interpretation of exemptions from the anti-SLAPP statute is inconsistent with the Legislature’s express intent that the statute’s core provisions “shall be construed broadly.”), in which the California Supreme Court re-emphasized that exemptions to the anti-SLAPP statute are to be narrowly construed so that the anti-SLAPP statute itself is broadly construed—make clear that the anti-SLAPP statute remains broadly available to litigants who face claims that are based on their constitutionally protected petitioning and free-speech activities.


Thomas R. Burke is a partner and co-chair of Davis Wright Tremaine LLP’s Media Practice. Mr. Burke practices in DWT’s San Francisco office and is the author of
Anti-SLAPP Litigation (The Rutter Group, 2016). The views expressed herein are Mr. Burke’s alone.

In Baral v. Schnitt, Mr. Burke and his DWT colleagues Rochelle Wilcox, Jason Harrow and John Freed filed an amicus brief on behalf of Los Angeles Times Communications LLC, Reporters Committee for Freedom of the Press, The First Amendment Coalition, The McClatchy Company, First Look Media, Inc., The Associated Press, News Corporation, Dow Jones & Co., Inc., The New York Times Company, Cable News Network, Inc., ABC, Inc. (including ABC News, KABC-TV, KGO-TV and KFSN-TV), The Hearst Corporation, Bloomberg, L.P. and CBS Broadcasting, Inc

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Ninth Circuit Finds First Amendment Protects Against Right-of-Publicity Claim Involving 
Film “The Hurt Locker” http://www.medialawmonitor.com/2017/01/ninth-circuit-finds-first-amendment-protects-against-right-of-publicity-claim-involving-%e2%80%a8film-the-hurt-locker/ Thu, 26 Jan 2017 23:45:30 +0000 http://www.medialawmonitor.com/?p=3220 By Kelli Sager, Karen Henry, and Brendan Charney

The U.S. Court of Appeals for the Ninth Circuit has confirmed that right-of-publicity claims purporting to arise from expressive works, like films, are content-based restrictions on speech that are presumptively unconstitutional and generally should not survive strict constitutional scrutiny. On Feb. 17, 2016, a panel of the Ninth Circuit issued a decision in Sarver v. Chartier, a right-of-publicity case arising from the Oscar-winning film “The Hurt Locker.” The panel unanimously affirmed the district court’s order dismissing the lawsuit on constitutional grounds. The panel also held that defendants in federal diversity cases are not restricted by the California SLAPP statute’s 60-day time limit for filing special motions to strike.

Background

Plaintiff Jeffrey Sarver served as an Army Explosive Ordnance Disposal technician in Iraq where he led teams that identified and disposed of improvised explosive devices (IEDs). During his military service, Sarver was photographed and interviewed by embedded journalist Mark Boal, who wrote an extensive magazine article about his experience, which included descriptions of Sarver’s life and experiences in Iraq. Boal subsequently wrote the screenplay for “The Hurt Locker.” Sarver sued the film’s creators, claiming that the movie’s main character was based on his own life story, in violation of his right of publicity; he also claimed that portions of the film defamed him and placed him in a false light.

Almost a year after Sarver filed his complaint, the defendant filmmakers filed special motions to strike under California’s SLAPP statute, California Code of Civil Procedure § 425.16. Sarver argued that the motions were untimely under C.C.P. § 425.16(f)—which provides that a SLAPP motion must be filed within 60 days after service of the complaint, absent a finding of good cause for the delay—but the district court exercised its discretion to accept the motions despite the passage of time on the grounds that the case was still in its early stages. Sarver v. the Hurt Locker LLC, 2011 WL 11574477, at *4, n.5 (C.D. Cal. Oct. 13, 2011).

The district court then granted the defendants’ SLAPP motions in their entirety, finding that the alleged use of Sarver’s life story was constitutionally protected. Applying California’s transformative-use test, the court held that any use of Sarver’s identity was “transformative” as a matter of law, because “a significant amount of original expressive content was inserted in the [film] through the writing of the screenplay, and the production and direction of the movie.” Sarver, 2011 WL 11574477, at *7. In particular, the court held that differences between Sarver’s life and the main character, along with “dialogue between characters, the other fictional characters with whom [the main character] interacted, and the direction of the actor all added significant and distinctive expressive content,” such that “the [main] character…, even if modeled after [Sarver], is ‘so transformed that it has become primarily the defendant’s own expression rather than the celebrity’s likeness.’” Id. (quoting Comedy III Prods. Inc. v. Gary Saderup, Inc., 25 Cal. 4th 387, 406 (2001)).

The district court also dismissed Sarver’s related claims for false light invasion of privacy, defamation, breach of contract, intentional infliction of emotional distress, fraud, and negligent misrepresentation.

Sarver appealed. More than two years after the case was argued and submitted, the Ninth Circuit affirmed the district court’s decision dismissing the lawsuit.

Timing of SLAPP Motions in Federal Diversity Cases

After confirming that California law applies to the case, the Ninth Circuit panel held that the defendants’ SLAPP motions were timely filed, notwithstanding the 60-day presumptive time limit set forth in C.C.P. § 425.16(f). The defendants argued that the California timing provision does not apply in federal court because it conflicts with federal summary judgment rules that allow a party to file a motion for summary judgment “at any time until 30 days after the close of all discovery.” Fed. R. Civ. Proc. 56. The panel agreed, holding that “the timing controls imposed by section 425.16(f) directly collide with the more permissive timeline Rule 56 provides for the filing of a motion for summary judgment.” Sarver v. Chartier, 813 F.3d 891, 900 (9th F.3d Cir. 2016). Consequently, the panel held that the 60-day limitation does not apply in federal court diversity actions and the motions to strike were timely filed under Rule 56. Id. This ruling will permit defendants sued in federal diversity cases arising from speech or petitioning activity to have more time to evaluate and present their defenses before the deadline to file a SLAPP motion elapses.

Right-of-Publicity Claims Are Subject to Strict Scrutiny

In addressing the merits of the SLAPP motions, the panel first held that the lawsuit was subject to a special motion to strike because it arose from the filmmakers’ speech on a matter of public concern: “Sarver’s work while deployed in Iraq.” Sarver, 813 F.3d at 902. Although Sarver argued that there was no public interest in his “private persona,” the panel rejected this argument, finding that the alleged depiction of Sarver’s personal characteristics “centered” around his work disabling IEDs in Iraq, which was a matter of public concern given the “significant attention devoted to the war and to the role of IEDs in it.” Id. This ruling was consistent with prior case law that had rejected arguments by plaintiffs that sought to limit the application of the statute to circumstances where the plaintiff’s personal identity was a matter of public interest. See, e.g., Doe v. Gangland Productions, 730 F.3d 946, 955 (9th Cir. 2013); Seelig v. Infinity Broad. Corp., 97 Cal. App. 4th 798, 807-808 (2002).

On the second prong of the statute, the panel held that Sarver could not establish a probability of prevailing on his right-of-publicity claim. Although the district court had dismissed the right-of-publicity claim on the grounds that California’s transformative-use test would preclude liability, the Ninth Circuit panel ruled that it did not need to resolve this affirmative defense because it found that Sarver’s claims could not withstand the requisite constitutional strict scrutiny. As the court explained:

“If California’s right of publicity law applies in this case, it is simply a content-based speech restriction. As such, it is presumptively unconstitutional, and cannot stand unless Sarver can show a compelling state interest in preventing the defendants’ speech. Because Sarver cannot do so, applying California’s right of publicity in this case would violate the First Amendment.” Sarver, 813 F.3d at 905-906.

In discussing its conclusion that Sarver could not show a compelling interest sufficient to overcome the defendants’ First Amendment rights, the court distinguished cases involving right-of-publicity claims arising from advertisements, noting that “The Hurt Locker is not speech proposing a commercial transaction … ” Id. at 905.

The court also distinguished the circumstances presented in Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 575-79 (1977), in which the U.S. Supreme Court, in its only decision involving right-of-publicity claims, held that the performer of a “human cannonball” act could bring a right-of-publicity action against a news outlet that broadcast the plaintiff’s “entire act”—thereby effectively preventing him from earning a living as a performer. Id. at 575-79. The court noted that neither the magazine articles about Sarver nor the film “stole Sarver’s ‘entire act’ or otherwise exploited the economic value of any performance or persona he had worked to develop.” Sarver, 813 F.3d at 905. In fact, the court noted, “Sarver did not ‘make the investment required to produce a performance of interest to the public,’… or invest time and money to build up economic value in a marketable performance or identity,” given that he “is a private person who lived his life and worked his job.” Id. at 905.

In a statement that applies equally to highly paid celebrities and working Army technicians, the court indicated that the right of publicity should not prevent expressive works from depicting prominent individuals’ lives and exploits, as long as the depiction does not misappropriate the value of an entire performance, because “[t]he state has no interest in giving [the plaintiff] an economic incentive to live his life as he otherwise would.” Id.

The panel also distinguished other recent Ninth Circuit cases, noting, among other things, that those cases “addressed the First Amendment only through the lens of California’s ‘transformative use’ doctrine” or through other defenses provided by California state law. Id. at 903-904, nn. 5-6. The Sarver panel did not reach the question of how the transformative-use test or any other particularized defenses to right-of-publicity claims would be adjudicated. See Id.

The court’s decision supports applying the right of publicity in only the narrowest of circumstances: when a person’s identity is used in a commercial advertisement, or when the value of a plaintiff’s entire performance or persona is usurped. This realigns right-of-publicity law to accord greater respect for First Amendment values. As the panel concluded, “The Hurt Locker is speech that is fully protected by the First Amendment, which safeguards the storytellers and artists who take the raw materials of life — including the stories of real individuals, ordinary or extraordinary — and transform them into art, be it articles, books, movies, or plays.” Id. at 905. The decision, therefore, represents a significant step forward in reining in the use of right-of-publicity claims to target expressive works.


Kelli Sager and Karen Henry authored an amici curiae brief in this case on behalf of the Motion Picture Association of America Inc. and Entertainment Merchants Association. Sager is a partner, Henry is counsel, and Brendan Charney is an associate in DWT’s Los Angeles office.

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2016 Oregon Update: Oregon Supreme Court Strikes Its Own Anti-SLAPP Path http://www.medialawmonitor.com/2017/01/2016-oregon-update-oregon-supreme-court-strikes-its-own-anti-slapp-path/ Wed, 25 Jan 2017 00:07:43 +0000 http://www.medialawmonitor.com/?p=3223 By Derek Green and Duane Bosworth

Before this year, no opinion from the Oregon Supreme Court had addressed in substance the state’s anti-SLAPP law, known as a “Special Motion to Strike.” That changed in 2016. Through two opinions, the state high court confirmed the two-part, burden-shifting process that governs the anti-SLAPP analysis, while also providing some clarity to ambiguity within the statutory language. The court also delivered a word of caution to Oregon practitioners and judges: In interpreting Oregon’s Special Motion to Strike, California anti-SLAPP case law only gets you so far.

Handy v. Lane County. The Oregon Supreme Court issued its most significant anti-SLAPP decision in Handy v. Lane County. The case raised a host of issues, including the intersection of anti-SLAPP procedures with the state’s public meetings law, the use of the anti-SLAPP procedure by public officials, and—most fundamentally—what exactly key portions of the statutory text are supposed to mean.

The plaintiff in Handy alleged that a county and three county commissioners violated Oregon’s public meetings law in multiple ways. The Supreme Court’s review focused on only one “aspect” of one claim, concerning whether seriatim communications could create a quorum for public meetings purposes. Reversing the Court of Appeals, the Supreme Court held that the trial court properly granted the defendants’ anti-SLAPP motion as to that aspect of the claim because the plaintiff failed to meet its statutory burden.

To reach that conclusion, the Handy opinion became the first Oregon Supreme Court decision to undertake a deep-dive examination of the anti-SLAPP law in Oregon. The analysis began by reaffirming the two-step, burden-shifting analysis in ORS 31.150 that governs all anti-SLAPP motions.  But it trained its analysis on the second step, answering the question of what a plaintiff must do to meet its statutory burden to defeat such a motion—namely, what does a “probability” of prevailing “by presenting substantial evidence to support a prima facie case” mean?

The high court recognized that the statutory text “does not provide a clear answer” to that question, observing that parts of the statute’s description of plaintiff’s burden quoted above “do not fit neatly together.” So the court turned to legislative history. That history revealed that the plaintiff’s burden was an issue of considerable debate in the legislative proceedings, with legislators and supporters of the bill cognizant of avoiding “constitutional concerns” that could arise if the statute required courts to weigh the evidence. After examining the history in detail, the court concluded that the proper interpretation of law was to require the plaintiff to present “enough evidence to avoid a directed verdict—namely, enough evidence to meet the plaintiff’s burden of production.” In other words, the question for the court became whether there was sufficient evidence for a “reasonable trier of fact to find that the plaintiff met its burden of production.”

In this respect, the framework of the Handy analysis—assessing the text, context and relevant legislative history to interpret an Oregon statute—should be familiar to Oregon practitioners. One notable and unusual aspect of that analysis, however, was the court’s several comments cautioning against overreliance on California law to interpret the Oregon Special Motion to Strike procedure.

Prior Oregon Court of Appeals decisions have repeated that it “was intended that California case law would inform Oregon courts regarding the application” of Oregon’s statutory procedure—also citing to legislative history. But the Supreme Court, while recognizing there is “no dispute that Oregon modeled its anti-SLAPP statute on California’s” law, emphasized that the differences in language between the Oregon and California statutes could not be overlooked. The lack of uniformity within the two state’s statutes, the court held, prevents Oregon courts from “presum[ing]” that California anti-SLAPP opinions decided prior to the enactment of Oregon’s procedure in 2001 “provide context” for interpreting those aspects of the statute that do not follow verbatim the California law. And the opinion did not stop there; it also emphasized that although Oregon Court of Appeals decisions have relied on California opinions decided after enactment of Oregon’s Special Motion to Strike Procedure to interpret Oregon’s anti-SLAPP law, “what [Oregon’s] statute means turns on what the Oregon legislature understood in 2001 when it enacted the [Special Motion to Strike].” Subsequent California cases “are relevant, at most, only for their persuasive value.”

It remains to be seen how much daylight will emerge between the two states’ anti-SLAPP procedures in practice. But there certainly is potential for different application of the state’s laws. Indeed, the Handy context is notable in this regard as well. When the Handy case was before the Court of Appeals, one judge wrote separately about the troublesome aspect of a government body, as well as public officials sued in their official capacity, bringing an anti-SLAPP motion against a plaintiff seeking review of government action. Judge DeVore observed that California’s anti-SLAPP statute, both as amended by statute and as interpreted by California courts, severely limits such a practice in California. It would seem safe to presume that the Oregon legislature’s intent in enacting an anti-SLAPP law was not to protect elected officials from suits by citizens seeking greater access to government meetings. But that is how the special motion to strike procedure was used here—and the Oregon Supreme Court’s decision, while not specifically addressing that issue, could support such a use in the future.

Neumann v. Liles. Although the Handy opinion addressed the anti-SLAPP procedure in more detail, the Oregon Supreme Court’s first written opinion on the anti-SLAPP procedure came earlier in the year, in Neumann v. Liles. Neumann reached the state’s high court as a defamation case brought by the owner of a wedding venue against a patron who posted a negative online review about the business. After the trial court granted the defendant’s special motion to strike the defamation claim, the Oregon Court of Appeals reversed, holding that the plaintiff had presented substantial evidence to support a prima facie case of defamation. The Supreme Court reversed the Court of Appeals on the basis that the challenged review was “entitled to First Amendment protection” and was therefore not actionable.

Most notable about this decision from an anti-SLAPP perspective is that the high court declined to squarely address whether the trial court correctly held that the anti-SLAPP procedure applied to the dismissed claim—in the court’s words, whether the “action was of a type subject to the provisions of the anti-SLAPP statute.” The court squarely held that the defamation claim was not actionable and thus affirmed the trial court’s dismissal of that claim. But whether that dismissal (and the related mandatory award of attorney fees to the defendant) was warranted under the anti-SLAPP procedure was left to the Court of Appeals on remand. In other words, although the Supreme Court clearly held that plaintiff could not substantively prevail on its defamation claim, it did not decide that the manner in which the defendant could defeat that claim was through a special motion to strike or some other mechanism, such as a motion to dismiss for failure to state a claim.

Derek Green is counsel and Duane Bosworth is a partner in Davis Wright Tremaine LLP’s Portland, Ore., office.

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D.C. Court of Appeal Decides Mann v. National Review and Burke II http://www.medialawmonitor.com/2017/01/d-c-court-of-appeal-decides-mann-v-national-review-and-burke-ii/ Tue, 24 Jan 2017 00:01:52 +0000 http://www.medialawmonitor.com/?p=3226 By Lisa B. Zycherman

In 2015, the District of Columbia Circuit held, in Abbas v. Foreign Policy Group, that the D.C. anti-SLAPP statute conflicts with the Federal Rules of Civil Procedure and is thus inapplicable in a federal court diversity case. The Abbas decision had the effect of making federal court potentially unavailable for parties who want to file an anti-SLAPP motion in the District of Columbia. Following the Abbas decision, nearly all activity involving the D.C. anti-SLAPP statute has occurred in the district’s nonfederal courts.

Unfortunately, a stack of SLAPP appeals have awaited resolution in the District of Columbia Court of Appeals, which—until the last days of 2016—had not issued a decision in Mann v. National Review. This case challenged, among other issues, whether the denial of an anti-SLAPP motion to dismiss was immediately appealable. In a 111-page decision, the D.C. Court of Appeals ruled in December that prominent climatologist Michael Mann’s defamation suit against Rand Simberg, Mark Steyn, National Review and the Competitive Enterprise Institute over blog posts written by Simberg and Steyn may proceed. More than two years after hearing oral arguments, the court sided with the defendants that denial of a special motion to dismiss pursuant to the anti-SLAPP statute is immediately appealable, but ultimately rejected their effort to have the defamation suit dismissed. On the merits, the appellate court upheld the lower court’s refusal to dismiss the defamation suit seeking to hold defendants liable for chastising Mann as “the Jerry Sandusky of climate science” and saying his global warming study “molested” data, concluding that Mann provided enough evidence to support his claims. The court’s procedural ruling, however, makes it more likely that non-meritorious suits can be quashed relatively quickly.

Before the Mann opinion, the D.C. Court of Appeals issued one other decision of note in 2016. The first time Burke v. Doe was before the District of Columbia Court of Appeals in 2014, it established new law, with the court holding that denial of a special motion to quash under the D.C. anti-SLAPP statute was immediately appealable under the collateral order doctrine. In that proceeding, the attorney plaintiff sued multiple anonymous defendants (“John Does 1–10”) alleging defamation and other torts arising from edits made to a Wikipedia page established her name. John Doe 1 had allegedly added information to the page using the name Zujua. After Ms. Burke caused a subpoena to be issued to obtain Wikipedia’s user data and thereby learn Zujua’s (and others’) identity, Zujua filed a special motion to quash the subpoena. The trial court denied the motion, but the D.C. Court of Appeals reversed, holding that Zujua had shown “that his speech is of the sort that the statute is designed to protect” and that the plaintiff, who was thus “required to show malice on Zujua’s part … to succeed” in rebuttal, had failed to show a “likelihood of success on [her] underlying claims.”

In Burke II, decided in March 2016, the D.C. Court of Appeals held that Zujua, a successful movant under the D.C. anti-SLAPP statute, was “entitled to reasonable attorney’s fees in the ordinary course unless special circumstances in the case make a fee award unjust,” reversing a Superior Court decision that refused to award Zujua fees. The Burke II court concluded that a successful anti-SLAPP movant is presumptively entitled to recover attorney’s fees, without any additional showing of frivolousness or wrongful motivation. And, the court held that, although the statute provided that the court “may” award fees to a successful anti-SLAPP movant (suggesting an element of discretion), both the statute’s stated purpose (“to award the costs of litigation to the successful party on a special motion”) and its legislative history (which based the D.C. anti-SLAPP statute on then-pending federal legislation that provided for the recovery of attorneys’ fees) supported a finding that a successful anti-SLAPP movant was presumptively entitled to recover its fees.

Lisa B. Zycherman is an associate in Davis Wright Tremaine LLP’s Washington, D.C. office.

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Ninth Circuit Retcons Its “Dancing Baby” Fair-Use Decision and Creates More Confusion http://www.medialawmonitor.com/2016/08/ninth-circuit-retcons-its-dancing-baby-fair-use-decision-and-creates-more-confusion/ Thu, 18 Aug 2016 17:55:17 +0000 http://www.medialawmonitor.com/?p=3165 By Lance Koonce

Retcon /retkän/: Abbreviation of “retroactive continuity”; “Revise (an aspect of a fictional work) retrospectively, typically by introducing a piece of new information that imposes a different interpretation on previously described events.”

— Oxford Dictionaries

Apparently, George Lucas is not the only party in California who can edit his own work after release in order to change aspects he does not like. While perhaps not as culturally significant as changing “Star Wars: A New Hope” so that Han Solo does not shoot first, Judge Richard C. Tallman, writing for the U.S. Court of Appeals for the Ninth Circuit, has now retconned the court’s holding in the important Lenz v. Universal Music Group case to muddle what might have become a key protection for copyright owners. While refusing to rehear the motion upon which the original order was issued, the court’s changes likely sow confusion for those seeking to enforce their intellectual property protections, while providing little additional comfort for internet service providers (ISPs) and users who face frivolous takedown notices under the Digital Millennium Copyright Act (DMCA).

For background, in 2007 Stephanie Lenz uploaded to YouTube a 29-second home video of her two young children dancing to the song “Let’s Go Crazy” by Prince, prompting Universal Music to send a DMCA takedown notice directing YouTube to remove the video as infringing. After YouTube notified Lenz, she sent counter-notifications that resulted in YouTube reposting the video. Lenz filed suit, claiming that Universal Music misrepresented in the takedown notice that the video was infringing, in part because Universal failed to consider whether the video might constitute a fair use.

The Ninth Circuit upheld the district court’s decision on this point, ruling that when submitting a takedown notice under the DMCA—which requires an owner to have a good-faith belief that the purportedly infringing material “is not authorized by the copyright owner, its agent, or the law”—copyright owners must first consider whether the use might be a fair use. The court held that failing to do so exposes the copyright owner to potential liability for damages under 17 U.S.C. § 512(f), because “the statute unambiguously contemplates fair use as a use authorized by the law.” The court then stated that the law requires copyright owners only to form a subjective, not objective, good-faith belief of infringement, and that so long as such a belief was formed, courts cannot second-guess that conclusion.

The court’s clarification that copyright owners bear this affirmative obligation of considering fair use was quite significant because, as we noted previously, the copyright takedown regime has become a massive undertaking by content owners, web hosts and users, and small shifts in burden can have large effects. The natural follow-up question that arose was: What does this affirmative obligation to consider fair use entail?

In the original decision by the Ninth Circuit, noting that it was “mindful of the pressing crush of voluminous infringing content that copyright holders face in a digital age,” the court took up this follow-on question, at least in part, suggesting that the fair-use analysis prior to a DMCA takedown notice “need not be searching or intensive” and did not require an “investigation of the allegedly infringing content.” Indeed, the court went even further and mused (in dicta) that computer algorithms might be employed to make a “first cut” fair-use decision, supplemented by human review of “the minimal remaining content a computer program does not cull.”

Petitions for Rehearing

Both parties petitioned the full court for rehearing. While Universal limited its argument to a jurisdictional (standing) issue, Lenz argued that the court’s ruling allowed a content owner to effectively censor speech—especially speech by ordinary individuals—by permitting a subjective belief, even where unreasonably held, to act as a shield for frivolous takedown notices.

Google, Tumblr, Twitter and the owner of WordPress submitted an amicus brief, arguing that unfounded or abusive takedown notices impose a significant cost on service providers as well as on free speech and that determining liability “solely on the subjective knowledge of the notice sender … would lead to the illogical result that the more unreasonable a copyright holder is, the more legal leeway it has to send unfounded notices.” Two other entities, Public Knowledge and the Organization for Transformative Works—whose earlier brief had been cited by the court for its reference to algorithms that can identify infringing content—also submitted an amicus brief, notably setting forth numerous ways in which takedown notices purportedly have been abused, including the use of “overbroad” matching algorithms.

Amended Decision

Whatever it thought of the arguments of the parties and amici, the Ninth Circuit declined to rehear its decision affirming the district court’s denial of summary judgment, instead taking the opportunity to issue an amended decision. That amended decision deletes almost two full pages from the original—most importantly, the paragraphs that set forth the type of fair-use consideration that the court originally indicated might suffice.

The decision also adds a footnote disagreeing with the dissenting judge, who believed that there was no triable issue of fact on fair use because Universal “did not specifically and expressly consider the fair-use elements.” The majority, however, held that the question of whether Universal’s fair-use analysis was enough to form a subjective good-faith belief that the video was infringed was a question for the jury.

Repercussions from the Amendment

What does all of this mean? As a threshold matter, it does not mean that in the Ninth Circuit a copyright owner now must undertake a searching and intensive fair-use analysis before sending a demand. When a decision is amended, the prior decision may no longer be cited for the purposes of precedent and, thus, the Ninth Circuit now simply has not defined the type of review that must be undertaken.

Given its insistence that the issue of a copyright’s owner’s subjective belief is for the finder of fact, the court may simply believe that trial courts will be better situated to determine whether the fair-use analysis was sufficient, in the context of particular facts. Of course, this alone likely tips more cases toward resolution by a jury rather than on summary judgment. However, given that the court also stated that merely forming a subjective belief is enough—regardless of whether it is proven correct—one imagines that so long as a content owner can show some proof of a decision-making process that includes fair-use consideration, some cases will still be subject to summary judgment on this issue.

The amended decision does highlight that copyright owners cannot assume that a cursory fair-use analysis will suffice. By not defining how careful the review must be, the court has left open the door for plaintiffs to argue that even though a fair-use analysis occurred, it was insufficient.

To the extent that frivolous or abusive takedown notices constitute a significant problem for ISPs and their customers, as argued by the service provider amici, it is possible that the Ninth Circuit’s amended decision might make it more difficult for unscrupulous or careless parties to claim they formed a good-faith belief as to fair use when they have not done so. However, because the court did not go as far as those parties wanted and left intact the subjective standard and has not defined the level of review required by copyright owners to form that subjective opinion, it is not clear that the decision provides that much additional comfort for ISPs or users either.

On the other hand, perhaps the most troubling aspect of the revised decision for copyright owners is the removal of the court’s language acknowledging the “pressing crush of voluminous infringing content that copyright holders face in a digital age” and discussing the use of computers “for processing a plethora of content.” Perhaps the court felt that requiring an owner to form a “subjective” opinion, while at the same time tacitly blessing computer algorithms to do the bulk of the decision-making, was confusing. Regardless, by deleting the language entirely it has muddled the issue even more. Will review using algorithms be adequate to form a subjective belief that there is no fair use, or are humans always required? The Ninth Circuit has now all but ensured that this issue will have to be litigated.

Practical Considerations

We previously suggested that copyright owners should have written procedures for identifying what content should be subject to a takedown notice and that those guidelines should expressly require a consideration of fair use. We also recommended that employees responsible for determining what material is infringing should receive information and training about fair use and document their fair-use determinations before issuing a takedown notice. This advice has not changed, although the latter steps have become more urgent in light of the court’s revisions.

To the extent copyright owners employ automated screening algorithms to identify potentially infringing content in the wake of the Lenz amended decision, obviously it would be best if human reviewers double-check for fair use before sending takedown notices, which may be possible for owners that do not deal with a large volume of takedowns. However, where this is not practicable given a large volume of content, content owners must be aware that the risk of an unfavorable court decision on an improper takedown notice increases as the algorithms move beyond merely finding exact duplicates and are used to identify content that matches because of titles, keywords or the like, and should employ second-level human review as appropriate.

Finally, as copyright owners begin to employ more advanced artificial-intelligence tools to perform initial reviews, it will be interesting to see whether courts can ever become comfortable with treating highly effective computer tools as analogous to providing the necessary “subjective” belief on the part of owners.

This seems unlikely in the near future. But if our prediction proves wrong, we can always retcon this advisory.

Lance Koonce is a partner in the DWT media group, based in our New York office.

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Streaming Video of Oral Arguments: Now Live in California… and Then Everywhere Else? http://www.medialawmonitor.com/2016/08/streaming-video-of-oral-arguments-now-live-in-california-and-then-everywhere-else/ Wed, 17 Aug 2016 17:41:29 +0000 http://www.medialawmonitor.com/?p=3162 By Jason Harrow

I love watching appellate arguments. When I worked for the office of the New York attorney general and my colleagues argued before the New York Court of Appeals, my entire office was able to gather around and watch the argument because that court streamed every argument live. And when I was lucky enough to make my own appearances in the Court of Appeals, my parents, grandparents and friends could see me in action without making the trip to Albany. When I moved to California this past fall, though, I was disappointed to find out that the California Supreme Court did not broadcast most of its proceedings.

Happily, that has recently changed. In March’s State of the Judiciary address, Chief Justice Tani Cantil-Sakauye announced that the California Supreme Court would begin live-streaming all of its oral arguments. The streaming cameras were turned on this past May in the San Francisco courthouses, with the other courthouses to follow later this year.

This is a welcome development that will put the California judiciary back at the forefront of the effort to increase public access to judicial proceedings. The California Channel actually began broadcasting certain Supreme Court arguments all the way back in 1991—but in the ensuing decades, there has been only sporadic coverage of the Supreme Court’s proceedings. Meanwhile, without much fanfare, many other state high courts from around the country began recording and streaming their proceedings.

Indeed, the California Supreme Court has become the newest member of a surprisingly large group of appellate courts that have begun to film, broadcast and archive all of their proceedings. With its new live-streaming video, California became the 35th state court of last resort to provide live or near-live online video access to its proceedings. Courts of all sizes, budgets and regions have begun to live-stream, either on their own or in connection with public broadcasting partners; other relatively recent new entrants include the high courts of Alaska, Michigan, South Carolina and Delaware. Intermediate appellate courts, too, have begun getting in on the action, as one of New York’s four appellate divisions began live-streaming just at the start of the year. More are sure to follow.

Perhaps the lack of coverage of this important emerging trend is due to federal appellate courts’ overall reluctance to embrace live-streaming. On this front, California is an outlier: While the Ninth Circuit has a remarkable system that allows anyone to live-stream arguments from any of its courtrooms—finally making possible the true addict’s dream of trying to watch simultaneous “split screen” arguments from the same court—it remains the only federal appellate court to regularly post live or archived video of its arguments. Instead, most other circuits have made available delayed audio-only recordings of proceedings. Posting delayed audio is also the current practice of the U.S. Supreme Court, which makes available audio from a given week’s arguments on the Friday after the arguments occur.

Given the progress state courts have made on this front, the reticence of federal appellate courts to embrace video-streaming is disappointing. The successful use of video by the appellate courts that do live-stream has proved that broadcasting appellate arguments has important benefits and virtually no downsides. For instance, in the benefits column, having available live video allows litigants and attorneys who worked on a case to easily view arguments they are interested in; it permits students and lawyers to learn oral advocacy skills and dig deeply into particular legal issues; it lets the public witness the careful, high-quality work done by appellate judges and advocates; and it even allows friends and family members of the judges or attorneys to follow along with their favorite cases.

Moreover, the limited evidence from currently available broadcasts from California shows that the California Supreme Court is likely to find that its regular live-stream will become quite a hit. While there are not yet archives of the recent arguments, the California Channel’s recording of In re Garcia, regarding whether an undocumented immigrant could become a licensed attorney, has more than 11,000 views on YouTube, and a broadcast of the argument in an earlier case called Brinker Restaurant Corp. v. Superior Court of San Diego has more than 9,500 views. Sure, these numbers aren’t exactly comparable to the hundreds of millions of views that Adele’s new music video might receive, but they are significant—and they surpass by orders of magnitude the number of people who could ever fit inside the courtroom or who would spend time hunting down a hard-to-find transcript.

Just as important, there have been essentially no negative consequences from online streaming: It costs very little to stream even high-definition video, with costs continuing to fall; neither lawyers nor judges have shown any appetite for grandstanding to the viewers following along with the live-stream; and there are no reports yet of any judge or lawyer becoming an unwanted target of the paparazzi as a result of streaming oral arguments. Plus, with no jury or witnesses in sight in appellate proceedings, privacy concerns are virtually nonexistent. With the Ninth Circuit, California, and a diverse collection of other state courts leading the way, perhaps the remaining state and federal courts that do not provide video access to proceedings—including the U.S. Supreme Court—will come to realize that whatever concerns they have about negative consequences of streaming are unlikely to occur.

And just consider what is lost to history by not allowing cameras in the courtroom. Thanks to the Florida Supreme Court’s excellent archive, for instance, I was able to go back and watch parts of the historic presidential election cases in 2000, as well as the proceedings in Jardines v. Florida, which later led to an important U.S. Supreme Court ruling regarding whether the use of a trained police dog on the porch of a home is a search under the Fourth Amendment. But because video cameras are still not allowed in the U.S. Supreme Court, a video record of what occurred in Washington, D.C., in each of those cases will never be available.

It is thus encouraging to know that future lawyers, students and citizens interested in the impactful California cases of our day will, from now on, be able to go back and watch what occurred in the courtroom. Maybe one day, with the help of evidence from California and elsewhere around the country, the remaining hold-out courts will change their minds, too.

Jason Harrow is an associate in DWT’s Los Angeles office. He has argued 14 appeals in state and federal courts, and he focuses his practice on litigation and counseling on copyright, defamation, and First Amendment-related matters.

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The Test of Time: 
Section 230 of the Communications Decency Act Turns 20 http://www.medialawmonitor.com/2016/08/the-test-of-time-%e2%80%a8section-230-of-the-communications-decency-act-turns-20/ Tue, 09 Aug 2016 18:08:16 +0000 http://www.medialawmonitor.com/?p=3168 By Ambika Doran and Tom Wyrwich

Twenty years have passed since Congress enacted the Communications Decency Act (CDA)—a law designed primarily to regulate obscenity and indecency on the internet. The statute made it illegal to knowingly send or show minors obscene or indecent content online. Section 230 of the act, 47 U.S.C. § 230, prohibited treating online service providers as the publisher or speaker of content provided by others or holding providers liable for attempts to eliminate objectionable content. Just a year after the CDA’s enactment, the Supreme Court struck down the criminal provisions. Reno v. Am. Civil Liberties Union, 521 U.S. 844 (1997). Only Section 230 survived.

It is no understatement to say the internet would not be what it is today without Section 230. The statute effectively eliminates most ordinary legal responsibilities assumed by traditional publishers with respect to third-party content. And as this article explains, it has largely withstood challenges brought by plaintiffs, even as those challenges became more creative.

The Basics

In 1995, a New York trial court found an internet service provider could be liable for the content of its subscribers’ posts, as the publisher of the content. Stratton Oakmont, Inc. v. Prodigy Servs. Co., 1995 WL 323710, at *6 (N.Y. Sup. Ct. May 24, 1995). The court relied heavily on the fact that the provider advertised its practice of controlling content on its service and actively screened and edited material posted on its message boards.

Congress enacted Section 230 to remove the “grim choice” created by Stratton Oakmont: A provider that voluntarily filtered content would be responsible for all posts, while “providers that bur[ied] their heads in the sand and ignore[d] problematic posts would escape liability altogether.” Fair Hous. Council v. Roommates.com, LLC, 521 F.3d 1157, 1163 (9th Cir. 2008).

The statute contains two substantive protections. Section 230(c)(1) states “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Section 230(c)(2) states “no provider or user of an interactive computer service shall be held liable on account of… (a) any action taken voluntarily in good faith to restrict access to… material that the provider or user considers… objectionable… or (b) any action taken to enable or make available to information content providers or others the technical means to restrict access to material described in [subparagraph (A)].” Section 230(e)(3) states “no liability may be imposed under any State or local law that is inconsistent with this section.” The statute exempts (among others) intellectual property laws and federal criminal statutes. Id. § 230(e)(1), (2).

Early Challenges

Despite the breadth of Section 230’s plain language—or perhaps because of it—plaintiffs began challenging the statute’s reach essentially from the moment of its passage. Early challenges led to the development of what are now basic principles.

Section 230 means what it says. The year after Congress passed Section 230, the U.S. Court of Appeals for the Fourth Circuit became the first federal circuit to interpret the law in the landmark decision Zeran v. America Online, Inc., 129 F.3d 327 (1997). Zeran made clear that the days of Stratton Oakmont really were gone. In Zeran, the court held Section 230 barred a defamation claim premised on AOL’s failure to remove an allegedly libelous advertisement, even after the plaintiff provided AOL notice of the content. It reasoned “Congress enacted § 230 to remove the disincentives to self-regulation created by the Stratton Oakmont decision.” Id. at 331. “[I]n line with this purpose, § 230 forbids the imposition of publisher liability on a service provider for the exercise of its editorial and self-regulatory function.” Id. The court rejected the plaintiff’s argument that common-law principles of notice liability survived Section 230: “Liability upon notice would defeat the dual purposes advanced by § 230 of the CDA. Like the strict liability imposed by the Stratton Oakmont court, liability upon notice reinforces service providers’ incentives to restrict speech and abstain from self-regulation.” Id. at 333.

Zeran’s message was clear: Section 230 was as broad as its language suggested. Over the next two decades, every other federal circuit adopted a similarly broad interpretation.

Section 230 applies to distributors, too. Early challenges to Section 230 also sought to narrow the immunity by arguing the statute applies only to publishers, not distributors. Under the common law, the publisher of a third party’s libelous statement bears the same responsibility as the author; the distributor faces a lower standard. Courts also rejected this argument. See, e.g., Barrett v. Rosenthal, 40 Cal. 4th 33, 48 (2006) (finding little reason “to suppose that Congress intended to immunize ‘publishers’ but leave ‘distributors’ open to liability, when the responsibility of publishers for offensive content is greater than that of mere distributors”); Barnes v. Yahoo!, Inc., 570 F.3d 1096, 1104 (9th Cir. 2009) (distinction between publisher and distributor “has little to do with the meaning of the statutory language”).

Efforts to Broadly Construe “Information Content Provider”

Once courts had established Section 230’s basic contours, plaintiffs turned their attention to the statute’s definition of “information content provider.” Section 230 shields a provider only for content “provided by another information content provider.” 47 U.S.C. § 230(c)(1). The law defines “information content provider” as “any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service.” Id. § 230(f)(3). Attempts to broaden the interpretation of “information content provider”—divided here into two categories—have generally failed.

The life (and death?) of the “encouragement” test. As websites became more interactive, plaintiffs began asserting a site could be responsible for content it somehow elicited. The Ninth Circuit was the first federal appellate court to accept such an argument.

In Fair Housing Council v. Roommates.com, the court held Section 230 did not bar housing discrimination claims against a roommate-matching website that required users to answer questions about themselves, such as their gender, sexual orientation and whether they lived with children, as well as about their housing preferences based on these criteria. 1161-62. The court held “a website helps to develop unlawful content, and thus falls within the exception to Section 230, if it contributes materially to the alleged illegality of the content.” Id. at 1168 (emphasis added). Roommates.com did this, it held, with respect to certain portions of its website. “By requiring subscribers to provide the information as a condition of accessing its service, and by providing a limited set of pre-populated answers,” the court wrote, “Roommate becomes much more than a passive transmitter of information provided by others; it becomes the developer, at least in part, of that information.” Id. See also FTC v. Accusearch Inc., 570 F.3d 1187, 1192, 1199 (10th Cir. 2009) (adopting “material contribution” standard to hold that a website was responsible for developing content because it hired researchers to obtain private telephone records, which required violating or circumventing federal law).

Seizing on dicta in Roommates.com and Accusearch, plaintiffs tried to defeat Section 230 by arguing a provider had helped “develop” content. They sought to expand the “material contribution” exception to include any time a website encouraged or allowed user content. But courts made clear (1) a provider loses immunity only if it develops the specific content alleged to be unlawful, and (2) “material contribution” requires much more than “encouragement” or assent. See, e.g., Hill v. StubHub, Inc., 727 S.E.2d 550 (N.C. Ct. App. 2012) (Section 230 barred claims StubHub violated state anti-scalping laws, even though the plaintiff alleged StubHub designed and intended its website to violate the law). See also Jones v. Dirty World Entertainment Recordings LLC, 755 F.3d 398, 403-06, 414 (6th Cir. 2014) (rejecting claims by the plaintiff, a teacher and NFL cheerleader, that the defendant “theDirty.com” was responsible for defamatory user comments because it encouraged users to post gossip; “an encouragement test would inflate the meaning of ‘development’ to the point of eclipsing the immunity from publisher-liability that Congress established.”).

Repurposing third-party content. A relatively untested theory alleges providers are responsible for content they aggregate and manipulate. Courts that have confronted such situations have generally held Section 230 bars claims based on repurposed user content but not those based on the provider’s own representations about their manipulation of that content. See Levitt v. Yelp! Inc., 2011 WL 5079526, at *7 (N.D. Cal. Oct. 26, 2011) (“Plaintiffs’ allegations of extortion based on Yelp’s alleged manipulation of their review pages—by removing certain reviews and publishing others or changing their order of appearance—falls within the conduct immunized by § 230(c)(1)”).

Arguing a Claim Does Not “Treat” a Provider as a Publisher or Speaker

Numerous plaintiffs have tried to hold websites responsible for failing to prevent physical harm. These cases often attack a different element of Section 230 immunity: whether the claim treats the online service provider as the “publisher” of content. Again, these efforts have failed.

Responsibility for assault of users. Many plaintiffs have brought claims based on assaults perpetrated by and against users of websites. Virtually every court to consider such a theory has rejected it. See, e.g., Doe v. MySpace, Inc., 528 F.3d 413 (5th Cir. 2008) (rejecting minor’s claim based on abuse she suffered after meeting a man on the MySpace website); M.A. v. Vill. Voice Media Holdings, LLC, 809 F. Supp. 2d 1041 (E.D. Mo. 2011) (rejecting claim seeking to hold classified advertising websites responsible for harm allegedly caused by the content of users’ ads); Dart v. Craigslist, Inc., 665 F. Supp. 2d 961, 967 (N.D. Ill. 2009) (same). But the Ninth Circuit bucked this trend when it decided Section 230 did not bar claims against a networking website based on the drugging and rape of a model whom two men had contacted using information from the website, posing as talent scouts. Doe v. Internet Brands, Inc., 767 F.3d 894 (9th Cir. 2014).

Responsibility for defective or illegal products. Less commonly, plaintiffs have tried to hold websites responsible for the sale of unlawful or defective goods. These efforts, too, have failed. See, e.g., Hinton v. Amazon.com.dedc, LLC, 72 F. Supp. 3d 685, 687 (S.D. Miss. 2014) (rejecting claims stemming from sale of recalled hunting equipment on eBay; “[a]ll of the Plaintiff’s claims against eBay arise or stem from the publication of information on www.ebay.com created by third parties”); Inman v. Technicolor USA, Inc., 2011 WL 5829024 (W.D. Pa. Nov. 18, 2011) (eBay not responsible for mercury poisoning contracted by plaintiff after purchasing vacuum tubes from third party on eBay.com); Gentry v. eBay, Inc., 99 Cal. App. 4th 816, 832-33, 121 Cal. Rptr. 2d 703 (2002) (declining to hold eBay responsible for sale of inauthentic sports memorabilia by third parties).

Taking Advantage of Section 230’s Express Exemptions

Section 230 has several exemptions. Plaintiffs have tried to shoehorn their claims into two—those for intellectual property and those for federal criminal law. 47 U.S.C. ¶ 230(e)(1),(2).

Intellectual property. Section 230 states that “[n]othing in this section shall be construed to limit or expand any law pertaining to intellectual property.” 47 U.S.C. § 230(e)(2). Although this language plainly exempts federal copyright and trademark claims, it is less clear whether the exemption encompasses state-law claims for violation of the right of publicity. Courts are split on this question. See Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1102, 1119 (9th Cir. 2007) (“intellectual property” means only federal intellectual property); Curran v. Amazon.com, Inc., 2008 WL 472433 (S.D. W. Va. Feb. 19, 2008) (applying immunity to right-of-publicity claim). Compare with Atlantic Recording Corp. v. Project Playlist, Inc., 603 F. Supp. 2d 690 (S.D.N.Y. 2009) (noting the Ninth Circuit’s conclusion lacked “any support in the plain language of the CDA”); Doe v. Friendfinder Network, Inc., 540 F. Supp. 2d 288, 299 (D.N.H. 2008) (allowing plaintiff to bring right-of-publicity but not invasion-of-privacy claim).

Federal criminal law. Section 230 provides “[n]othing in this section shall be construed to impair the enforcement of … any … Federal criminal statute.” 47 U.S.C. § 230(e)(1). It also states “[n]othing in this section shall be construed to prevent any State from enforcing any State law that is consistent with this section.” This has been fertile ground for myriad attempts to evade immunity—but again, courts have generally rejected these efforts.

For example, plaintiffs have repeatedly argued, unsuccessfully, that these provisions leave room for civil suits alleging a violation of criminal laws. See, e.g., Obado v. Magedson, 2014 WL 3778261, *8 (D.N.J. July 31, 2014) (“exception for federal criminal statutes applies to government prosecutions”); Hinton, 72 F. Supp. 3d at 692 (Section 230 barred civil claim alleging eBay violated federal criminal statute).

Recognizing this—and concerned in particular about third-party ads for sex—three state legislatures enacted criminal laws targeted at advertising. Courts held each of them invalid. See Backpage.com, LLC v. Hoffman, 2013 WL 4502097, at *7 (D.N.J. Aug. 20, 2013); Backpage.com, LLC v. Cooper, 939 F. Supp. 2d 805, 821-26 (M.D. Tenn. 2013); Backpage.com, LLC v. McKenna, 881 F. Supp. 2d 1262, 1274-75 (W.D. Wash. 2012).

Conclusion

In 2012, one court noted it had located 300 reported decisions deciding Section 230 immunity. “All but a handful,” it noted, “find that the website is entitled to immunity.” Hill, 727 S.E.2d at 558. This trend has continued. That does not mean online service providers can operate without fear of litigation. Courts have yet to fully explore fact patterns that do not necessarily fall within the traditional confines of the immunity. And as providers innovate new ways to interact with users, plaintiffs will continue to devise creative challenges to immunity.

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The Wild, Distributed World: 
Get Ready for Radical Infrastructure Changes, from Blockchains to the Interplanetary File System to the Internet of Things http://www.medialawmonitor.com/2016/08/the-wild-distributed-world-%e2%80%a8get-ready-for-radical-infrastructure-changes-from-blockchains-to-the-interplanetary-file-system-to-the-internet-of-things/ Wed, 03 Aug 2016 18:10:42 +0000 http://www.medialawmonitor.com/?p=3172 By Lance Koonce

Every so often—and now more frequently than ever before—we are treated to a deluge of media stories telling us why some new technology will change our lives. Recently, the thundering drumbeat of technology topics has included artificial intelligence, robotics and virtual reality, to name just a few. Certainly each of these waves of development is worthy of close attention as they promise to affect our lives significantly over the coming decades.

Another development that has received a good deal of attention over the past year is blockchain technology, the convection engine that powers bitcoin and that is now finding its way into other systems. Blockchains are rightfully touted as having the potential to disintermediate many existing market inefficiencies, whether in the financial industry (where it has already had a substantial impact) or music royalty networks or energy grids.

However, perhaps the most interesting thing about the blockchain tempest is that it does not just involve blockchains. In remarkable ways, the discussion around blockchains appears to be leading to a new mode of thinking about the architecture of our digital world generally. This involves rethinking much of the existing infrastructure. As a result, energizing discussions about first principles are now arising in many different areas.

So what does this mean as a practical matter? It means that a wide range of industries stands to be disrupted and reinvented and that the winds of change are going to blow in from every quadrant. But let’s start with some brief background.

Distributed, Decentralized and Disrupted

Distributed computing has been around since at least the 1970s. At their core, distributed systems are networks of computers where each node can act on its own and has its own storage but where the nodes also can work together to handle tasks by passing messages back and forth. For many years, computer networks were typically controlled by central servers. Decentralized computing broke through in the late 1990s with the introduction of peer-to-peer networks such as Napster. Under these systems, centralized infrastructures are unnecessary as software is distributed to all of the nodes, and then the nodes communicate directly with each other.

The primary breakthrough introduced by Bitcoin in 2009 was that it made use of a decentralized, peer-to-peer structure to validate and record transactions between computers. In other words, it created a distributed database that does not require any centralized arbiters of trust, plus a transaction system for moving data (value). Thus value, in the form of bitcoin, can move swiftly between parties without middlemen. This creates enormous efficiencies.

Transactions facilitated by blockchain technology are automatically verified by a multitude of computers, and the transactions are recorded in a digital ledger that exists on all of those computers simultaneously. The ledger grows with each additional transaction and, thus, can be used to confirm not just the most recent transaction but all of those on the chain. Thus blockchains are both transparent and secure.

As the underlying blockchain technology has been adopted for systems not related to bitcoin, the advantages of the technology have become even more clear. The potential to eliminate intermediaries and thereby create market efficiencies has generated a massive storm surge of investment in companies building blockchain solutions. Further, the blocks of data that are verified and recorded in the distributed ledger of a blockchain can contain virtually any type of information, permitting a variety of digital assets to be securely exchanged and making the records of those exchanges virtually immutable.

For this reason, blockchain solutions are being proposed in numerous industries, from media to advertising to e-commerce.

Tearing Down and Building Up

Blockchains appear to be just the starting point, however. A company known as Ethereum has created a robust programming platform built upon a blockchain structure, which allows the creation of much more complex solutions. In particular, the Ethereum blockchain is designed to facilitate “smart contracts,” which are agreements that parties can set up to execute automatically on the occurrence of a predetermined event or the input of specific data. For example, an export company in one country could agree with an import company in another country to automatically send instructions to a shipper to send products to the importer when a certain amount of money is received. All of this would execute automatically without the need for third parties.

Separately, companies building blockchain solutions involving digital content such as music and images have recognized that it may be important to have a distributed database for storage of the content itself (blockchains are not efficient mechanisms for actually transmitting large files; they are, instead, good at storing and moving cryptographic identifiers for underlying files). Thus, there has been a convergence between some blockchain solutions and other decentralized, distributed solutions such as the proposed Interplanetary File System, which aims to be a global, peer-to-peer database of content files.

In a recent white paper, IBM argued that decentralization is a necessary ingredient for a robust Internet of Things (IoT)–the vast interactive network of sensors, appliances and other distributed devices. While IBM noted that blockchains are a key component, they are only a part of the solution. IBM’s report states that a decentralized IoT will require peer-to-peer messaging, distributed file sharing and autonomous device coordination.

Other examples of a new distributed and decentralized, global infrastructure include decentralized autonomous organizations (or corporations), which would be entities run by a set of business rules, enshrined in software code and recorded permanently on a blockchain. In fact, one experimental “DAO” was recently created and attracted substantial investment (nearly $200 million) and then was quickly hacked, resulting in losses of around a quarter of that value, demonstrating both the attractiveness of such structures and also the Wild West nature of the current ecosystem.

So What?

When the internet came into existence and then became ubiquitous, it restructured the way we communicate with each other at a fundamental level. Blockchains and related technologies may have the same type of impact on the way value is transferred and stored. The internet revolution allowed forward-thinking individuals and companies to reimagine entire industries. Similarly, this new wave of technologies is facilitating profound discussions about long-established principles that underpin many business structures.

Music

One example that we have been following is the music business. Blockchains and related technologies may offer a means of creating a new, global database for music. However, there is a healthy debate occurring among many of those involved in this effort about exactly what the right approach should be. Should we create a new standard for music metadata that everyone must agree upon? Should we create interoperable systems that permit the ingestion of multiple sets of competing metadata? Can we fix the problem of bad metadata for existing music at all, or should we concentrate only on the future? Will tackling the existing problems make things better or worse for musicians and consumers? How will the record labels and music publishers and technology platforms fit within the new structures?

Supply Chains

Supply chains may gain significant efficiencies from blockchain-based registries of transactions, and at the same time blockchain technology promises to provide much greater transparency as to each step along the way. Each item passing through the supply chain could conceivably have an indelible record of its precise history—want to know exactly where those apples you’re eating came from (what type of farm and where), and where they stopped along the way? Some companies will embrace this new transparency, but others may avoid it, and one might expect to see some consumers begin to shift to suppliers who provide more complete information about the history of their products, which could also create radical shifts in the marketplace.

Science

Another example is the problem of unpublished research papers. According to some, unpublished papers and raw research are rich sources of information that remain largely inaccessible. For instance, while publications tend to look for papers describing breakthroughs, often it is important for other researchers to know that a particular approach failed. A decentralized, distributed global database of scientific research available beyond the walls of particular institutions might help fundamentally change the way science is done.

Manufacturing

As mentioned, blockchain and related tech (sometimes referred to as the Internet of Value) may become inextricably linked with the IoT. One branch of the latter is the Industrial IoT, which involves manufacturing components embedded with sensors that “talk” to one another and other systems. Many people also are discussing the potential for smart factories where much of the manufacturing process is autonomous. Decentralized networks may play a huge role in facilitating the adoption of these technologies which, in turn, will disrupt the entire manufacturing process from bottom to top.

These are just a few possibilities. Virtually any system or network or business structure that relies on centralized authority, or on “trusted intermediaries” to enable transactions, can potentially be the target of the disruptive forces to come (or not: centralized networks continue to be perfect solutions for many situations). Issues such as how existing laws and regulations will apply to these new structures will be of critical importance.

To be fair, focusing on decentralization and distributed, peer-to-peer networks like blockchains may be the equivalent of gazing out of just one narrow window upon what is almost certainly a much larger sea change. There are a very wide variety of emerging technologies that could be converging to radically alter our world.

But what is important to recognize is that these winds of change, whatever their source, provide enormous opportunities to reimagine from the ground up what infrastructure might provide the soundest framework for future growth and give nimble companies exciting new business opportunities.

For more information on blockchains and related technology:

We also offer customized, one-hour in-house presentations on blockchain technology, for CLE credit, to selected clients and friends. If you are interested in setting up an in-house session, please contact us at lancekoonce@dwt.com.

Please visit our blog at www.CreativeBlockchain.com.

Lance Koonce is a partner in the DWT media group, based in our NY office.

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Ninth Circuit Finds First Amendment Protects Against Right-of-Publicity Claim Involving Film “The Hurt Locker” http://www.medialawmonitor.com/2016/07/ninth-circuit-finds-first-amendment-protects-against-right-of-publicity-claim-involving-film-the-hurt-locker/ Fri, 29 Jul 2016 18:19:44 +0000 http://www.medialawmonitor.com/?p=3176 By Kelli Sager, Karen Henry, and Brendan Charney

The U.S. Court of Appeals for the Ninth Circuit has confirmed that right-of-publicity claims purporting to arise from expressive works, like films, are content-based restrictions on speech that are presumptively unconstitutional and generally should not survive strict constitutional scrutiny. On Feb. 17, 2016, a panel of the Ninth Circuit issued a decision in Sarver v. Chartier, a right-of-publicity case arising from the Oscar-winning film “The Hurt Locker.” The panel unanimously affirmed the district court’s order dismissing the lawsuit on constitutional grounds. The panel also held that defendants in federal diversity cases are not restricted by the California SLAPP statute’s 60-day time limit for filing special motions to strike.

Background

Plaintiff Jeffrey Sarver served as an Army Explosive Ordnance Disposal technician in Iraq where he led teams that identified and disposed of improvised explosive devices (IEDs). During his military service, Sarver was photographed and interviewed by embedded journalist Mark Boal who wrote an extensive magazine article about his experience, which included descriptions of Sarver’s life and experiences in Iraq. Boal subsequently wrote the screenplay for “The Hurt Locker.” Sarver sued the film’s creators, claiming that the movie’s main character was based on his own life story, in violation of his right of publicity; he also claimed that portions of the film defamed him and placed him in a false light.

Almost a year after Sarver filed his complaint, the defendant filmmakers filed special motions to strike under California’s SLAPP statute, California Code of Civil Procedure § 425.16. Sarver argued that the motions were untimely under C.C.P. § 425.16(f)—which provides that a SLAPP motion must be filed within 60 days after service of the complaint, absent a finding of good cause for the delay—but the district court exercised its discretion to accept the motions despite the passage of time on the grounds that the case was still in its early stages. Sarver v. the Hurt Locker LLC, 2011 U.S. Dist. LEXIS 157503, *11 n.5 (C.D. Cal. Oct. 13, 2011).

The district court then granted the defendants’ SLAPP motions in their entirety, finding that the alleged use of Sarver’s life story was constitutionally protected. Applying California’s transformative-use test, the court held that any use of Sarver’s identity was “transformative” as a matter of law, because “a significant amount of original expressive content was inserted in the [film] through the writing of the screenplay, and the production and direction of the movie.” Sarver, 2011 U.S. Dist. LEXIS 157503 at *21. In particular, the court held that differences between Sarver’s life and the main character, along with “dialogue between characters, the other fictional characters with whom [the main character] interacted, and the direction of the actor all added significant and distinctive expressive content,” such that “the [main] character…, even if modeled after [Sarver], is ‘so transformed that it has become primarily the defendant’s own expression rather than the celebrity’s likeness.” Id. (quoting Comedy III Prods. Inc. v. Gary Saderup, Inc., 25 Cal. 4th 387, 406 (2001)).

The district court also dismissed Sarver’s related claims for false light invasion of privacy, defamation, breach of contract, intentional infliction of emotional distress, fraud, and negligent misrepresentation.

Sarver appealed. More than two years after the case was argued and submitted, the Ninth Circuit affirmed the district court’s decision dismissing the lawsuit.

Timing of SLAPP Motions in Federal Diversity Cases

After confirming that California law applies to the case, the Ninth Circuit panel held that the defendants’ SLAPP motions were timely filed, notwithstanding the 60-day presumptive time limit set forth in California Code of Civil Procedure § 425.16(f). The defendants argued that the California timing provision does not apply in federal court because it conflicts with federal summary judgment rules that allow a party to file a motion for summary judgment “at any time until 30 days after the close of all discovery.” Fed. R. Civ. Proc. 56. The panel agreed, holding that “the timing controls imposed by section 425.16(f) directly collide with the more permissive timeline Rule 56 provides for the filing of a motion for summary judgment.” Sarver v. Chartier, 2016 U.S. App. LEXIS 2664, *17 (9th Cir. 2016). Consequently, the panel held that the 60-day limitation does not apply in federal court diversity actions and the motions to strike were timely filed under Rule 56. Id. This ruling will permit defendants sued in federal diversity cases arising from speech or petitioning activity to have more time to evaluate and present their defenses before the deadline to file a SLAPP motion elapses.

Right-of-Publicity Claims Are Subject to Strict Scrutiny

In addressing the merits of the SLAPP motions, the panel first held that the lawsuit was subject to a special motion to strike because it arose from the filmmakers’ speech on a matter of public concern: “Sarver’s work while deployed in Iraq.” Sarver, 2016 U.S. App. LEXIS 2664 at *21-22. Although Sarver argued that there was no public interest in his “private persona,” the panel rejected this argument, finding that the alleged depiction of Sarver’s personal characteristics “centered” around his work disabling IEDs in Iraq, which was a matter of public concern given the “significant attention devoted to the war and to the role of IEDs in it.” Id. This ruling was consistent with prior case law that had rejected arguments by plaintiffs that sought to limit the application of the statute to circumstances where the plaintiff’s personal identity was a matter of public interest. See, e.g., Doe v. Gangland Productions, 730 F.3d 946, 955 (9th Cir. 2013); Seelig v. Infinity Broad. Corp., 97 Cal. App. 4th 798, 807-808 (2002).

On the second prong of the statute, the panel held that Sarver could not establish a probability of prevailing on his right-of-publicity claim. Although the district court had dismissed the right-of-publicity claim on the grounds that California’s transformative-use test would preclude liability, the Ninth Circuit panel ruled that it did not need to resolve this affirmative defense because it found that Sarver’s claims could not withstand the requisite constitutional strict scrutiny. As the court explained:

“If California’s right of publicity law applies in this case, it is simply a content-based speech restriction. As such, it is presumptively unconstitutional, and cannot stand unless Sarver can show a compelling state interest in preventing the defendants’ speech. Because Sarver cannot do so, applying California’s right of publicity in this case would violate the First Amendment.” Id. at *30.

In discussing its conclusion that Sarver could not show a compelling interest sufficient to overcome the defendants’ First Amendment rights, the court distinguished cases involving right-of-publicity claims arising from advertisements, noting that “The Hurt Locker is not speech proposing a commercial transaction … ” Id. at 29.

The court also distinguished the circumstances presented in Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 575-79 (1977), in which the U.S. Supreme Court, in its only decision involving right-of-publicity claims, held that the performer of a “human cannonball” act could bring a right-of-publicity action against a news outlet that broadcast the plaintiff’s “entire act”—thereby effectively preventing him from earning a living as a performer. 433 U.S. 575-79. The court noted that neither the magazine articles about Sarver nor the film “stole Sarver’s ‘entire act’ or otherwise exploited the economic value of any performance or persona he had worked to develop.” Sarver, 2016 U.S. App. LEXIS 2664 at 29-30. In fact, the court noted, “Sarver did not ‘make the investment required to produce a performance of interest to the public,’… or invest time and money to build up economic value in a marketable performance or identity,” given that he “is a private person who lived his life and worked his job.” Id. at 29.

In a statement that applies equally to highly paid celebrities and working Army technicians, the court indicated that the right of publicity should not prevent expressive works from depicting prominent individuals’ lives and exploits, as long as the depiction does not misappropriate the value of an entire performance, because “[t]he state has no interest in giving [the plaintiff] an economic incentive to live his life as he otherwise would.” Id.

The panel also distinguished other recent Ninth Circuit cases, noting, among other things, that those cases “addressed the First Amendment only through the lens of California’s ‘transformative use’ doctrine” or through other defenses provided by California state law. Id. at 26-27, fns. 6, 7. The Sarver panel did not reach the question of how the transformative-use test or any other particularized defenses to right-of-publicity claims would be adjudicated. See Id.

The court’s decision supports applying the right of publicity in only the narrowest of circumstances: when a person’s identity is used in a commercial advertisement, or when the value of a plaintiff’s entire performance or persona is usurped. This realigns right-of-publicity law to accord greater respect for First Amendment values. As the panel concluded, “The Hurt Locker is speech that is fully protected by the First Amendment, which safeguards the storytellers and artists who take the raw materials of life — including the stories of real individuals, ordinary or extraordinary — and transform them into art, be it articles, books, movies, or plays.” Id. at 30. The decision, therefore, represents a significant step forward in reining in the use of right-of-publicity claims to target expressive works.

Kelli Sager and Karen Henry authored an amici curiae brief in this case on behalf of the Motion Picture Association of America Inc. and Entertainment Merchants Association. Sager is a partner, Henry is counsel, and Brendan Charney is an associate in DWT’s Los Angeles office.

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Documentary Interviewee Hit with Sanctions for Making False Allegations Against Center for Investigative Reporting http://www.medialawmonitor.com/2016/07/documentary-interviewee-hit-with-sanctions-for-making-false-allegations-against-center-for-investigative-reporting/ Tue, 26 Jul 2016 18:23:13 +0000 http://www.medialawmonitor.com/?p=3179 By Thomas Burke and Alison Schary

Almeciga v. Center for Investigative Reporting et al., Case No. 1:15-cv-4319-JSR, — F. Supp. 3d —, 2016 WL 2621131 (S.D.N.Y. 2016)

This past May, Judge Jed S. Rakoff of the Southern District of New York issued a blistering 65-page opinion tossing a plaintiff’s suit against the Center for Investigative Reporting (CIR) and labeling it a “fraud upon the court.”

Background

CIR interviewed plaintiff Erica Almeciga in August 2012 for a documentary concerning Rosalio Reta, a former hitman for the Los Zetas cartel, currently serving a prison sentence in Texas. CIR interviewed Almeciga because she represented to CIR that Reta was her husband. Almeciga willingly participated in the approximately 30-minute interview and signed a release in the presence of CIR’s producers, and the story—titled “I was a Hitman for Miguel Treviño”—was published online in July 2013. A Spanish-language version of the story was also broadcast by Univision and viewed by millions.

Nearly a year later, in June 2014, Almeciga began calling CIR, claiming that she wanted her identity obscured in future uses of her interview footage. Almeciga hired counsel, Kevin Landau of The Landau Group (with offices in New York and Michigan), who demanded that CIR obscure Almeciga’s identity in the existing published piece. After CIR advised Landau that his client had signed a full release, Almeciga insisted that the release was forged. Landau sent CIR an opinion letter that he had obtained from a purported “handwriting expert,” claiming that the signature on the release was not Almeciga’s.

On April 23, 2015, Alemciga filed a complaint in New York state court, asserting claims for breach of oral contract, fraud and fraudulent concealment against CIR and the individual producers who worked on the piece, as well as a claim for negligence against Univision on the grounds that it should have personally verified her consent to participate in the report, notwithstanding the signed release.

CIR removed the case to the Southern District of New York. Hearing Univision’s motion to dismiss the negligence claim—the only claim brought against it—along with CIR’s opposition to the motion to remand on the grounds that Univision was fraudulently joined, the court agreed that there was no duty owed by Univision to the plaintiff and, thus, no plausible negligence claim. The court dismissed Univision from the case, finding that it had been fraudulently joined, and rejected the plaintiff’s remand motion. See 121 F. Supp. 3d 379 (S.D.N.Y. 2015).

After Almeciga amended her complaint to add a claim for unjust enrichment, CIR filed a motion for judgment on the pleadings on the grounds that plaintiff’s breach of oral-contract claim—based on an alleged oral agreement to conceal her identity in perpetuity—is barred by New York’s Statute of Frauds. CIR also argued that Almeciga’s remaining claims—fraud, fraudulent concealment and unjust enrichment—were duplicative of the deficient contract claim.

In the meantime, CIR discovered court papers filed by Almeciga in a local Georgia court seeking and then withdrawing a request for a restraining order. These certified court papers contained numerous examples of Almeciga’s distinctive signature—a clear match for her signature on the release she claimed was forged. The court documents also contained Almeciga’s home address, phone number and date of birth, as well as the names and dates of birth of her children. CIR provided these court documents to Almeciga and her counsel, demanding that the case be withdrawn on threat of sanctions.

Rather than withdraw her case, Almeciga doubled down on her claim that the CIR release was forged—and now insisted that she never filed the Georgia court documents either. Almeciga then replaced her first “handwriting expert” with a second purported expert, Wendy Carlson, who submitted a Rule 26 expert report stating that Almeciga did not sign the release. However, Almeciga and her counsel chose not to provide their new expert with the Georgia court documents that were the basis of CIR’s threatened sanctions motion. Instead, the new proffered expert relied solely on five signatures provided by Almeciga, none of which predated her legal claims and many of which appeared to have been created expressly for the purpose of comparison.

CIR moved for Rule 11 sanctions on Sept. 14, 2015. Along with the Georgia court documents, CIR’s motion included documents indicating that Almeciga was aware of the story at the time it was initially published in July 2013 and had even publicized the interview (and her role in it) via Twitter. CIR also attached footage from the full interview, which contains no circumstantial evidence that—as Almeciga claimed—there was an oral agreement to conceal her identity for fear of retribution from the cartel. Almeciga’s interview was shot in full light, with no screen or other concealing device, and she confirms on camera that she is not afraid of retribution for her participation in the interview.

The court convened a full two-day evidentiary hearing on CIR’s sanctions motion and, relatedly, the admissibility of Almeciga’s expert under Daubert and Kumho Tire. The court used this hearing to grill the plaintiff’s expert on her qualifications and the basis for her opinion that Almeciga’s release was “forged.” At the hearing, in addition to the Georgia court documents, CIR confronted Almeciga with documents filed in various Massachusetts court proceedings which contained copious examples of her distinctive handwriting and several signatures that were contemporaneous with—and nearly identical to—her August 2012 signatures on the CIR release. During her testimony, Almeciga denied filing any of the documents containing a signature identical to the release but admitted to filing the remainder. When it came time for Almeciga’s fiancé to take the stand, he was asked to identify Almeciga’s signature in the same set of documents, and the court’s clerk caught Almeciga attempting to coach his responses on the stand, prompting an admonishment from Judge Rakoff that Almeciga not make any further eye contact with the witness.

The court granted CIR’s motion for judgment on the pleadings by order dated March 31, 2016, noting that a written opinion would follow. On May 6, 2016, the court issued its Opinion and Order explaining the basis for its dismissal on the pleadings; excluding the plaintiff’s expert under Daubert and Kumho Tire; and granting CIR’s Rule 11 motion against the plaintiff, terminating the case as a sanction.

Analysis

The court’s opinion was a full-throated vindication for CIR and its producers and provides a helpful road map for the types of behavior that may be subject to Rule 11 sanctions. The court found CIR’s witnesses to be credible and noted that there was “no discernible motive” for CIR and its producers to breach a promise to conceal Almeciga’s identity—nor any evidence that such a promise existed in the first place. In contrast, the court found the plaintiff to be “not remotely credible.” The court provided a litany of examples where the plaintiff failed to offer any plausible explanation for her various allegations, which “collapse[d] under scrutiny,” and noted that she was “caught in several apparent lies at the evidentiary hearing,” further reinforcing the court’s finding that she was an “incredible and unreliable witness.” In light of the evidence presented, the court found “by clear and convincing evidence that [the] plaintiff perpetrated a fraud on the court by pressing critical and serious allegations that she knew to be false.” Given the plaintiff’s indigent circumstances, the court imposed only the nonmonetary sanction of dismissal with prejudice. Id. at *18-*22.

Regarding CIR’s claim for sanctions against Almeciga’s counsel, Landau, the court noted that the motion “raises the thorny issue of where vigorous advocacy ends and punishable disregard of the facts begins.” Id. at *23. Finding that “counsel (barely) satisfied his obligation under Rule 11,” the court declined to impose sanctions. The court explained: “Counsel’s pursuit of this lawsuit in the face of mounting evidence indicating his client was lying is certainly questionable and borders on unreasonable, but the court does not find that it quite meets the high standard that must be satisfied to impose sanctions.” Id.

The opinion also wades heavily into the debate over the admissibility of handwriting experts under Rule 702. The court included a lengthy discussion of the history of handwriting analysis and forensic document examination, expressing healthy skepticism about the reliability of such analysis under Rule 702 as a general matter. After this introduction, the court found that Carlson’s testimony did not meet the standards of either Daubert or Kumho Tire, finding it “fundamentally unreliable and critically flawed.” Id. at *17. In particular, the court noted that Carlson relied solely on the plaintiff’s representation that the “known” signatures she reviewed —all of which were created after the dispute arose—were accurate representations of Almeciga’s signature and were not intentionally disguised to obtain a favorable result. The court considered this assumption to be a “critical flaw” in Carlson’s methodology, rendering her analysis “effectively pre-ordained” and, thus, unreliable under Rule 702. Id. at *16. The court punctuated its analysis with images of the contested signatures and handwriting samples, noting “strong similarities to the naked eye” that “any layperson” could identify. Id. at *19-*20.

The decision may also provide helpful precedent in cases involving disputes over alleged promises to sources. The court held that an oral agreement to conceal an individual’s identity in perpetuity—as the plaintiff alleged here—is void under the statute of frauds because it cannot be completed within a year. Accordingly, a promise to shield a subject’s identity must be in writing to be enforceable. The court also affirmed well-established law that a plaintiff “may not bootstrap a breach of contract claim into a fraud claim by simply including … an allegation that the defendant never intended to uphold his end of the deal.” Id. at *4 (internal citations omitted).

Defendants Center for Investigative Reporting, Bruce Livesey, and Josiah Hooper were represented by Thomas R. Burke, Alison Schary, and Jeremy Chase of Davis Wright Tremaine LLP.

Thomas R. Burke is partner and co-chair of DWT’s media practice group, based in our San Francisco office. Alison Schary, based in Washington D.C., is an associate in the media practice group.

Reprinted with permission from the June 2016 issue of the MLRC MediaLawLetter. © 2016, Media Law Resource Center, Inc. All rights reserved.

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Fair Use, Viral Videos, and Correcting the Record About the Jukin Case http://www.medialawmonitor.com/2016/07/fair-use-viral-videos-and-correcting-the-record-about-the-jukin-case/ Thu, 14 Jul 2016 19:08:28 +0000 http://www.medialawmonitor.com/?p=3182 By Jason Harrow

While fair use has recently evolved in a way that has been, for the most part, increasingly hospitable to commentators, critics and appropriation artists, it remains an area in which there are few bright line rules. Understandably, then, whenever there is a fair-use case involving a new and innovative use by an artist or critic, creators and lawyers alike must examine that decision carefully. Unfortunately, the recent case of Equals Three v. Jukin Media, one of the first fair-use cases involving multiple viral videos, has been publicized but frequently misconstrued. Here, I attempt to correct the record and explain why this case is actually quite favorable to fair use of viral videos, even if that conclusion has frequently gotten lost in the translation of a case that saw more than its fair share of unusual procedural moves.

Start with the viral videos and their uses. Declaratory judgment plaintiff Equals Three Media produces regular YouTube-only comedy programs that use short viral videos—think people tripping and cats snuggling—as jumping off points for a series of jokes, often connected around a particular theme. Defendant Jukin Media is a new kind of content company that scours the internet for viral videos, licenses them from the owners, and then produces compilation shows of its own and also seeks additional licensing opportunities for the videos in its library.

Equals Three used Jukin-controlled viral videos in at least 18 of its comedy show programs but did not obtain licenses; instead, Equals Three claimed it made fair uses of the videos by commenting on and transforming them. After Jukin sent Equals Three a letter stating its view that the uses were infringing, Equals Three sued Jukin in the Central District of California to obtain a declaration that its videos did not infringe Jukin’s copyrights.

But Equals Three’s litigation tactics were unusual for a copyright case. In particular, while Jukin swiftly moved for a grant of summary judgment that Equals Three’s uses were not fair uses, Equals Three did not make the opposite request and ask the court to declare that its uses were permitted under the fair-use doctrine. Because of this procedural quirk, the court’s lone substantive opinion, issued on Oct. 13, 2015, essentially found that Equals Three’s uses were fair for 17 of the 18 videos—but the court did not enter judgment in Equals Three’s favor because Equals Three did not ask for summary judgment on that issue.

The court’s opinion, though, still provides an important analysis explaining why creative, comedic and original uses of viral videos will often be considered fair uses. On the first fair-use factor, addressing the purpose and character of the use, the court found the uses in all but one episode were “highly transformative” because the show had used the videos in creative ways, made jokes and comments about them, and altered them substantially, including through voiceover and creative editing. Finding this type of use to be transformative provides important guidance not only to other YouTube program creators like Equals Three but also to the many people and programs who regularly use viral videos as the raw materials for everything from stand-up comedy routines that use viral videos to late-night television satire.

Importantly, Equals Three’s transformative use of the viral videos overshadowed the other three fair-use factors. The court gave only “slight weight” to the second factor, the nature of the copyrighted work, because that factor was “not particularly important where the new work is highly transformative.” On the third factor, the amount used of the copyrighted work, the court again sided with Equals Three because transformative users are permitted to take even the “arguable heart” of videos if they do “not show more than is reasonably necessary” of the videos. And on the final factor, market harm, the court found there was only “hypothetical” evidence of harm and, therefore, said the factor was neutral.

Adding these together, the court concluded that the factors “weigh[ed] in favor of fair use” for all but one episode. Although that conclusion would typically have resulted in a judgment in favor of Equals Three, because Equals Three failed to bring a motion asking the court to find in its favor on that issue, the fair-use issue was left to be tried before a jury. Still, that fact should not overshadow the actual legal takeaway of the court’s careful opinion, which strongly favors fair use.

The second misunderstanding around this case surrounds the outcome of the jury trial on infringement. The parties settled before the jury announced its verdict. As a matter of law, then, there was no verdict, and the summary judgment opinion finding that the factors weighed in favor of fair use for most videos should have been the last word. But, unusually, several websites reported that one anonymous juror said that the jury would have found the uses were infringing on all of the videos. This muddied the waters and may have caused many people to think that Jukin had essentially prevailed.

That’s not the case. Even if this anonymous juror is reporting accurate information about what verdict the jury would have reached, the statement is both legally meaningless—the case was settled and dismissed before a verdict was entered—and of no precedential value anyway. Moreover, the case never should have gone before the jury in the first place, as the judge had earlier found that the overwhelming majority of the videos were fair uses.

Luckily, the rules of evidence and precedent will ensure that the court’s summary judgment opinion finding mostly in favor of fair use provides the lasting legal legacy of this dispute. Indeed, producing original content that comments on and transforms viral videos was found to be—and should be—a fair use. In that sense, the legal reasoning of the court in Equals Three, then, in some ways picks up where the Seventh Circuit left off in Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687, 693 (7th Cir. 2012), which had held that a “South Park” parody of a viral video was a clear fair use, in part because the “underlying purpose and character of [South Park’s] work was to comment on and critique the social phenomenon that is the ‘viral video.’” With more and more content creators using viral videos creatively, hopefully the actual legal reasoning in Equals Three, Brownmark and other cases will cut through the media noise and provide a strong foundation for fair use in this context.

Jason Harrow is an associate in DWT’s Los Angeles office. He focuses his practice on litigation and counseling on copyright, defamation, and First Amendment-related matters. He is also an experienced appellate advocate and has argued 14 appeals in the state and federal appellate courts.

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In-House Insider: 
Medium http://www.medialawmonitor.com/2016/07/in-house-insider-%e2%80%a8medium/ Tue, 05 Jul 2016 19:11:53 +0000 http://www.medialawmonitor.com/?p=3185 By Jaya Kasibhatla

Medium was launched in August 2012 by Twitter co-founder Evan Williams as a way for social media users to publish ideas and stories. Over the past few years, Medium has quickly become one of the most popular online publishing platforms where people can publish their own original content and collaborate on writing. With growth comes a host of legal issues to consider. In the latest installment of its In-house Insider feature, Media Law Monitor sat down with lawyers Sarah Agudo, head of legal, and Alex Feerst, corporate counsel, to discuss the day-to-day challenges the Medium legal team faces.

1. What does a typical day look like for Medium’s legal team?

Alex Feerst: Like many lawyers, some days start fast and early—you wake up, glance at your phone and there’s a backup of emails and slacks from things that happened overnight or in other time zones. For example, maybe we wake up to a bunch of tweets from people in Malaysia or China, saying Medium’s been blocked. If they’re pressing, one of us will start handling it right away. We both come to the office with a long list of short tasks, a moderate list of things that will take sustained work, and one or two big ideas.

Sarah Agudo: Probably by about 9:45 we’ve both temporarily abandoned our lists, sync up, and figure out what to focus on for the day. It’s a balance between taking care of all the issues that come up—contracts, product questions, a tricky takedown request—and making real progress on something bigger, like figuring out how to restructure the employee stock-option plan to better align everyone’s incentives or develop a plan for takedown requests in a foreign jurisdiction.

AF: We work together a lot. The office is open plan and we sit at neighboring desks. We ask and give each other constant reality checks and hand work back and forth pretty much all day. It’s a team sport.

2. What legal issues do you deal with the most in your position?

SA: Between the two of us, we keep all the legal plates spinning, including general corporate work like fundraising, board matters, and M&A, employment and immigration work, all of our commercial contracts, product counseling, and intellectual property and privacy issues related to users and content on Medium. We also spend a fair amount of time setting and implementing trust and safety policy.

3. Which is what?

AF: Trust and safety is basically anything affecting how users interact with content and each other on Medium. Our goal is to optimize those qualities in our ecosystem. So, for example, user-generated content (UGC) copyright and trademark issues are considered trust and safety issues because they concern whether content or user accounts are being used ethically and lawfully. Trust and safety also includes content that has been reported as potentially violating our Terms of Service, Privacy Policy or Rules (which prohibit things like doxxing or harassment). With the amount of UGC that goes up on Medium every day, there’s a constant stream of these issues. Some are pretty routine or at least recognizable, but plenty are surprising and complex.

SA: We have a team that investigates, takes action and responds to grievances. Some of the harder calls, or complaints with some complexity in the underlying law, get escalated to us. We argue over the tough calls. We apply the relevant law or our site rules. As we get hard cases, sometimes we tweak those rules as we learn. Every decision affects Medium’s ecosystem, so we think hard about the rules and each application.

4. So what’s really difficult for you and your team? When do you have OMG moments?

AF: Every single day. We shake our heads. The number of jurisdictions we’re in adds complexity. On the content side, on any given day, we might get escalated to us issues not just from the U.S., but also various EU countries, Brazil, India, Turkey, or Togo. We may have a strong view on how a Californian’s publicity rights work, but how about someone writing in from Marseille, France about a post detailing a personal relationship without permission, or a photo taken in a public place in Berlin, a screenshot of a heated text exchange between someone in Ireland and someone in Korea. Some places don’t have the protections for intermediaries or relative clarity of U.S. law.

SA: We’re tasked with doing more than the minimum required under the law. Our challenge is to figure out how to keep Medium open but civil. What types of personal information constitutes a privacy violation when posted, or what things go over the line from just mean into harassment or bullying or hate speech? We wrestle with new cases that come up every day and think carefully about how to apply our rules fairly and consistently. We want freedom of speech on Medium. But we also believe that the era where online norms tended towards standing aside while users threaten each other, spout vitriol, or post information that might put someone in danger is over.

5. Is it difficult to advise non-lawyers about legal issues?

SA: In some ways, sure. We don’t want to be the hall monitors who come in and stop someone from realizing their vision for a product. We want law and product to fit together.

AF: Right, so when we do product counseling, we try to bake it in from inception. We deputize all our engineers and content folks as the front line. They’re the ones spotting issues and developing instincts for when they should come find us. We hold regular sessions with employees on things like privacy and regulatory guidelines so their daily work integrates their evolving instincts.

SA: Our goal is for employees to think about these issues as they frame product features and content projects. Rather than coming to us right before a launch to say, “Oh, by the way, is this feature legal?” we want them coming to us on Day One saying, “We have an idea to build a feature that works like this….”

AF: That way the legal thinking is embedded in the product, rather than a compliance solution that’s bolted on later. We basically want the smart people we work with to look at the legal or trust and safety issues as another set of interesting constraints that inform how we design and build.

SA: And as another chance to do right by our users and co-workers. We give them a lot of trust, and, by and large, people come to us early and with enthusiasm for how to problem solve rather than dreading a legal compliance meeting that’s going to burst their bubble.

AF: We don’t want to just say no, try again; we want to spark curiosity about how the law structures their work and then harness the energy that comes from that. People tell us we’re fun for lawyers, but who knows.

6. In what ways does a new media company like Medium grapple with issues that are associated with more traditional media?

AF: So, most of what’s on Medium is UGC. This includes many publications on Medium that are run and edited by users. All we do is provide the platform and tools. For that side of the business, you get tech-company type issues. Both of us grew up as lawyers in the Bay Area, so these are the sorts of the things we’re familiar with and love to work on—privacy and data issues, copyright, technology licenses, and generally running the company in line with the legal norms that tech workers in San Francisco are used to—minimal noncompete and nonsolicitation clauses, potentially valuable trade secrets.

SA: Over time we’ve had some in-house publications, like Matter and Steven Levy’s tech publication, Backchannel. These publications, among other things, worked as laboratories and exemplars for user-run publications. They produced polished and award-winning journalism and showed what you can do with Medium. These have more traditional content issues.

AF: They also conversely taught us about product. In addition to all of the users out there in world, we had a group of opinionated journalists and editors across the office who would come explain what they were trying to do, why they wanted certain features, or what was getting in their way. This sort of constant in-house focus grouping helped us learn tons, from legal and product perspectives, about how people use Medium—what kind of amazing work they would produce and what messes they might make. Our in-house people did plenty of both.

SA: There are also in-between areas like content curation, a team of folks organizing UGC, making it more logically or interestingly structured, more findable, and more in line with what a given community of readers and writers has on its mind at a given time.

7. What kind of things DO you expect from outside counsel, or Wish they would know?

AF: Sometimes I think I went from being outside counsel to being confused by outside counsel in three days. For me, the best kind of interactions with outside counsel involve thoughtful, candid and succinct answers to two questions: (1). Is it legal? and (2). Is it wise? I prefer real talk to being obviously managed, like something from an old friend who’s unafraid to deliver hard truths when necessary. I love working with people who can show me the biggest possible picture—the forces and motivations at work, the legal levers and practical pitfalls of a position, the downstream and implications of a decision, the range of outcomes, and the knock-on effects for other parts of our business and industry.

SA: I agree that real talk versus being managed is key. We value people who are willing to cut to the chase and to go with us when we question the way things are traditionally done but also feel comfortable pushing back. We get a lot from having outside counsel feel like part of the legal team and company rather than like service providers, to people who are curious about the product or whether a particular decision really fits with the company’s values. We try to be pragmatic. We both first practiced at law firms and try to be mindful about how the work actually gets done—simple things like saying to an associate “this is not urgent” or “this one small part is important now, the rest is for future curiosity.” We don’t get much out of unnecessary scrambling or hedging against exceedingly unlikely scenarios. Medium’s a startup, so we prefer short phone calls to long emails and pretty much never want a monogrammed memo or a copied-and-pasted treatise.

8. What advice do you have for other media lawyers?

SA: Umm—lawyering is often more than lawyering? Sometimes it’s about setting up events that won’t happen for a while, or may never—a negotiation position, a way to differentiate our product, a form of clear notice, or a de-escalated relationship. For decisions we make that are product-related or public facing, we think a lot about “how will this make our users feel?” Part of Medium’s thinking here is that treating users really well is a competitive advantage and also part of leading the way to an internet that is more open, high-trust and civil. So, we try to make these lofty-sounding ideas concrete in things like our user-facing legal documents, such as our rules and privacy policy. Writing functional terms of service that set forth the normal set of rights among the usual suspects in familiar language was just the starting point. We agonize over how to write them in very clear, plain language that is transparent about the underlying rights—things that will make the product (deservedly) feel trustworthy and approachable to people who want to read and write on Medium.

AF: When we rolled out our last terms-of-service update, we got all kinds of emails and tweets in response, but some of them went like this one: “Literally and by far the best update to terms of service type email I’ve ever received. Blows the others away. This is how I would treat updates to my terms of service and privacy policy if I had such things. I’m impressed, just wanted to give kudos to the legal team.” We didn’t just keep the company safe and the legal plumbing clear. The terms of service connected with someone. And in the process of giving notice and disclaiming and structuring rights and responsibilities, it gave them a positive feeling about Medium. That was a good day.

As of July 2016, Sarah Agudo has joined Snapchat.

Jaya Kasibhatla is an associate in the DWT media group, based in our New York office.

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Internet Service Providers and Oldies Fans Rejoice: 
Second Circuit Holds the DMCA Safe Harbor Covers Pre-1972 Sound Recordings http://www.medialawmonitor.com/2016/06/internet-service-providers-and-oldies-fans-rejoice-%e2%80%a8second-circuit-holds-the-dmca-safe-harbor-covers-pre-1972-sound-recordings/ Tue, 28 Jun 2016 19:14:37 +0000 http://www.medialawmonitor.com/?p=3188 By Jim Rosenfeld and George Wukoson

The U.S. Court of Appeals for the Second Circuit’s June 16, 2016, decision in Capitol Records, LLC v. Vimeo, LLC was a victory for internet service providers who host third-party content. It plugged a major loophole in the Digital Millennium Copyright Act (DMCA) safe harbor for information stored on a service provider’s system or network at the direction of a user, 17 U.S.C. § 512(c), by holding that the safe harbor applies to pre-1972 sound recordings. It also forcefully reaffirmed that a service provider must have either actual or “red flag” knowledge of specific copyright infringement—rather than merely generalized knowledge of infringing activity on its system—and fail to remove the infringing material expeditiously in order to lose the safe harbor and be held liable for that infringement.

Summary of decision

A slew of record companies and music publishers sued Vimeo, the operator of a website on which users can post videos. The parties’ appeal to the Second Circuit followed the district court’s rulings on whether Vimeo was entitled to the DMCA’s safe-harbor protections set out in § 512(c). Broadly, the district court ruled in the plaintiffs’ favor that the DMCA safe harbor only absolves service providers from liability based on federal copyright law, which does not apply to pre-1972 sound recordings. The court granted Vimeo summary judgment as to 153 videos on the basis that the plaintiffs lacked evidence that Vimeo’s employees had viewed them and denied summary judgment to either side on remaining videos incorporating post-1972 sound recordings because of a question of material fact as to whether Vimeo had “red flag” knowledge of their infringement.

The Second Circuit granted interlocutory review of three questions:

Whether the safe harbor of § 512(c) applies to pre-1972 
sound recordings;

Whether the evidence that Vimeo employees viewed some videos containing “recognizable” copyrighted songs was sufficient to show Vimeo’s red-flag knowledge, rendering it ineligible for the safe harbor; and

Whether the plaintiffs showed that Vimeo had a general policy of willful blindness to infringement of sound recordings, justifying imputation to Vimeo of knowledge of the specific infringements at issue.

The court decided all three issues in Vimeo’s favor and both clarified and strengthened its prior decision in Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19 (2d Cir. 2012) in the process. We summarize the court’s reasoning and holdings below.

Issue 1: Whether the safe harbor of § 512(c) applies to pre-1972 sound recordings: Yes

Congress first included sound recordings within the scope of federal copyright protection in 1972, and pre-1972 recordings have never been covered by federal copyright. Section 301 of the Copyright Act asserts federal pre-emption of state copyright laws but provides with respect to pre-1972 sound recordings that “any rights or remedies under the common law or statutes of any State shall not be annulled or limited by this title until February 15, 2067,” after which time federal law would pre-empt state law and cause pre-1972 sound recordings to pass into the public domain. 17 U.S.C. § 301(c). The plaintiffs argued that if § 512(c) were interpreted to protect service providers from infringement liability under state copyright laws, it would be irreconcilable with § 301(c)’s exclusion of pre-1972 recordings from pre-emption. Thus they argued that § 512(c) should be read to cover only infringement of federal copyright law; because federal copyright law does not apply to pre-1972 recordings, the federal safe harbor could not apply either.

The Second Circuit saw a stark contradiction between the plain meaning of the safe-harbor provision and the Copyright Office’s interpretation of it. According to the court, “the district court accepted without discussion the position taken by the United States Copyright Office in a report prepared in 2011 that the safe harbor does not protect against liability for infringement of pre-1972 sound recordings.” The Copyright Office had misconstrued the Copyright Act and misapplied certain canons of construction, incorrectly limiting the scope of the safe harbor to federal copyright infringement claims. While the Second Circuit “unhesitatingly acknowledge[d] the Copyright Office’s superior expertise on the Copyright Act,” the court found the Copyright Office’s interpretation of the Copyright Act “not reasonable” and instead held that safe harbor “protects service providers from all liability for infringement of copyright, and not merely from liability under the federal statute.” Accordingly, the Second Circuit reversed the grant of summary judgment to the plaintiff record companies for infringement of the pre-1972 recordings.

Issue 2: Whether the evidence that Vimeo employees viewed some videos containing “recognizable” copyrighted songs was sufficient to show Vimeo’s red-flag knowledge, rendering it ineligible for the safe harbor: No

Under YouTube, in order to be disqualified from the safe harbor due to red-flag knowledge under § 512(c)(1)(A)(ii), the provider must be “subjectively aware of facts that would have made the specific infringement ‘objectively obvious to a reasonable person.’” This “reasonable person” is an ordinary person without specialized music or copyright law knowledge. The Second Circuit held that merely viewing a video that contains all or nearly all of a “recognizable” copyrighted song is insufficient to make infringement “obvious” to the reasonable person without specialized knowledge. It noted that § 512(m) makes clear that a service provider’s personnel are under no duty to “affirmatively seek” indicia of infringement or “investigate” whether the use was licensed or whether the “fair use” or “parody” exceptions apply.

Significantly, the Second Circuit took the opportunity to clarify the parties’ burdens of proof in a safe-harbor case, adopting a description from Nimmer on Copyright. A defendant must show entitlement to the safe harbor by demonstrating its status as a service provider that stores users’ material, that the allegedly infringing matter was placed there by a user, and that it has performed § 512’s conditions of liability, including having a policy to exclude repeat infringers, a designated agent, and standard technical measures to detect infringements. It is the copyright owner’s burden to demonstrate disqualifying knowledge, by showing the service provider: (1) acquired knowledge of the infringement or facts and circumstances from which infringing activity was obvious and (2) failed to promptly take down the infringing material.

The court held that “[a] copyright owner’s mere showing that a video posted by a user on the service provider’s site includes substantially all of a recording of recognizable copyrighted music, and that an employee of the service provider saw at least some part of the user’s material, is insufficient to sustain the copyright owner’s burden of proving that the service provider had either actual or red flag knowledge of the infringement.” This is because: (1) the employee’s viewing might have been brief; (2) the employee might have viewed such a video for many different business purposes, such as for technical reasons, to classify by subject matter, to detect obscenity or bigotry, and “innumerable other objectives having nothing to do with recognition of infringing music on the soundtrack”; and (3) the employees cannot be assumed to have copyright-law expertise—for example, to know how to distinguish between infringement and fair-use parodies or to know whether or not the use is licensed. Accordingly, the court held that “Vimeo is entitled to summary judgment on those videos as to the red-flag knowledge issue, unless plaintiffs can point to evidence sufficient to carry their burden of proving that Vimeo personnel either knew the video was infringing or knew facts making that conclusion obvious to an ordinary person who had no specialized knowledge of music or the laws of copyright.”

Issue 3: Whether the plaintiffs showed that Vimeo had a general policy of willful blindness to infringement of sound recordings, justifying imputation to Vimeo of knowledge of the specific infringements: No

The Second Circuit rejected three arguments made by the plaintiffs that Vimeo was willfully blind to infringement of sound recordings. First, the plaintiffs argued that while Vimeo apparently screened visual content of videos for infringement, it did not screen their audio content. The Second Circuit reasoned that § 512(m) relieves the service provider of obligation to monitor and saw “no reason why Vimeo’s voluntary undertaking to monitor videos for infringement of visual material should deprive it of the statutory privilege not to monitor for infringement of music.” Second, the plaintiffs argued that Vimeo’s awareness of facts suggesting a likelihood of infringement gave rise to a duty to investigate further, combined with its failure to do so, shows liability. But again, the court could “see no reason to construe [§ 512(c)] as vitiating the protection of § 512(m) and requiring investigation merely because the service provider learns facts raising a suspicion of infringement (as opposed to facts making infringement obvious). Protecting service providers from the expense of monitoring was an important part of the compromise embodied in the safe harbor.” Further, “[i]f service providers were compelled constantly to take stock of all information their employees may have acquired that might suggest the presence of infringements in user postings, and to undertake monitoring investigations whenever some level of suspicion was surpassed, these obligations would largely undo the value of § 512(m).”

Third, the plaintiffs pointed to statements of Vimeo employees apparently actively encouraging users to post infringing videos, such as responding to a question about the use of copyrighted music as audio for original video content with, “Don’t ask, don’t tell ;).” The plaintiffs reasoned that Vimeo could not encourage posting of infringing matter and close its eyes to resulting infringements without liability. The Second Circuit held that the specific evidence cited by plaintiffs of “a handful of sporadic instances (amongst the millions of posted videos),” none of which related to any videos at issue in the suit, could not support a finding of generalized encouragement or red-flag knowledge as to those specific videos and, thus, it did not reach plaintiffs’ argument that “a service provider cannot adopt a general policy of urging or encouraging users to post infringing material and then escape liability by hiding behind a disingenuous claim of ignorance of the users’ infringements.” The court instead held that “Vimeo can still assert the protection of § 512(m) for the present suit, and claim the benefit of the safe harbor, in the absence of a showing by Plaintiffs of facts sufficient to demonstrate that Vimeo, having actual or red-flag knowledge of infringement in the videos that are the subject of Plaintiffs’ suit, failed to promptly take them down.”

Observations

The court both engaged in a close reading of the statute and gave consideration to the policy purpose of the DMCA safe harbor: to strike a compromise whereby service providers must adopt a notice-and-takedown procedure to avoid the costs of monitoring and liability for user content. It noted in discussing pre-1972 sound recordings, for example, that “[t]he purpose of the compromise was to make economically feasible the provision of valuable Internet services while expanding protections of the interest of copyright owners through the new notice-and-takedown provision.” To leave out state copyright “would defeat the very purpose Congress sought to achieve in passing the statute.”

The court strongly rejected the Copyright Office’s interpretation of the Copyright Act. The court stated that, although the Copyright Office’s report does not receive Chevron deference, given the office’s intimate familiarity with the Copyright Act, the Second Circuit would “give appropriate deference to its reasonably persuasive interpretations of the Copyright Act.” Here, however, the court found the Copyright Office’s interpretation unpersuasive, flatly rejecting it as a misreading of the law.

The court was clear that red-flag knowledge must be based on knowledge of specific facts going to specific instances of infringement. It clarified and strengthened YouTube, including by precisely allocating the burdens of proof in a DMCA safe-harbor case, based on the allocation set out in the Nimmer treatise. The court even embraced the plaintiffs’ characterizations of its holding as rendering red-flag knowledge a very small category, not vastly different from actual knowledge.

Relatedly, while the plaintiffs identified seemingly damning communications in which Vimeo employees seemed to encourage, or at least condone, infringement by users, it was apparently compelling to the court that none of those communications related to videos in the lawsuit.

Moreover, as of the time of publication, the record companies have petitioned for rehearing en banc, and additional record companies, the American Association of Independent Music and Recording Industry Association of America have submitted amicus briefs in support of that petition for rehearing.

Jim Rosenfeld, partner and co-chair of the media practice group, and George Wukoson, associate, are based in DWT’s New York office.

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2015: A Year-End Review of Litigation Using California’s Anti-SLAPP Statute http://www.medialawmonitor.com/2016/02/2015-a-year-end-review-of-litigation-using-californias-anti-slapp-statute/ Thu, 04 Feb 2016 07:22:23 +0000 http://www.medialawmonitor.com/?p=3102 By Thomas R. Burke and Diana Palacios

Annually, California’s Courts of Appeal and the Ninth U.S. Circuit Court of Appeals regularly issue several dozen published opinions interpreting California’s anti-SLAPP statute, Civil Procedure Section 425.16 et seq., and 2015 was no different. California’s landmark anti-SLAPP statute remains one of the broadest and strongest statutory protections for free speech and petitioning activities in the nation. Below we briefly summarize significant 2015 anti-SLAPP cases decided by California courts.

PRONG ONE: Does the Anti-SLAPP Statute Apply?

In 2015, many cases analyzed prong one of the statute – whether the plaintiff’s claims arose from the defendants’ challenged speech or petitioning activities. Cal. Civ. Proc. § 425.16 (b)(1) & (e).

Two anti-SLAPP cases, both involving application of the anti-SLAPP statute, will be resolved by the California Supreme Court.

On May 13, 2015, the court granted review in Baral v. Schnitt (CA Supreme Court No. S225090) to resolve a split among lower courts on whether an anti-SLAPP motion can be used to strike “mixed” causes of action – causes of action that contain allegations subject to the anti-SLAPP statute and allegations not within the purview of the statute. In Baral, the Second District Court of Appeal acknowledged a conflict among the appellate courts and disagreed with the line of cases holding that a mixed claim should be stricken because according to the court, the anti-SLAPP statute does not apply to anything less than a cause of action and the statute’s core purpose of disposing of lawsuits arising from speech and petitioning activity is not served when no cause of action is eliminated.

On Dec. 16, 2015, the court granted review in Park v. Board of Trustees of the California State University (CA Supreme Court No. S229728). Park, an applicant for a tenured faculty position who was denied tenure and consequently terminated, brought a lawsuit for national origin discrimination. The trial court denied the anti-SLAPP motion finding that the gravamen of the complaint was not the defendant’s communicative conduct, but was instead the act of denying the plaintiff tenure. The appellate court reversed, holding the claims arose from activity protected by the anti-SLAPP statute because the university’s tenure review proceedings constituted official proceedings for the purpose of CCP 425.16 (e)(2) and the communications at issue were statements and written reviews made during the plaintiff’s tenure review. In Park, the California Supreme Court will decide the following question: Does Code of Civil Procedure section 425.16 authorize a court to strike a cause of action in which the plaintiff challenges only the validity of an action taken by a public entity in an “official proceeding authorized by law” (subd. (e)) but does not seek relief against any participant in that proceeding based on his or her protected communications? This case will likely explore issues concerning the government’s ability to use the anti-SLAPP statute.

In Grenier v. Taylor, 234 Cal. App. 4th 471 (2015), the appellate court held that allegedly libelous Internet postings regarding the leadership of a church were of public interest under the first prong of the anti-SLAPP statute because they were of interest to a church community of 550 to 1,000 members, which was “large enough to qualify as a ‘community’ for purposes of section 425.16,” and in “the context of information ostensibly provided to aid consumers choosing among churches, the [allegedly defamatory] statements were connected to an issue of public concern.” The court, however, went on to hold that the plaintiffs had established a probability of prevailing.

Anderson v. Geist, 236 Cal. App. 4th 79 (2015) involved the execution of a search warrant. The appellate court acknowledged that the execution of a warrant was “an act in furtherance of a criminal prosecution” as the defendants argued, but the court affirmed the trial court’s denial of an anti-SLAPP motion because the anti-SLAPP statute is not available where the government is not exercising a right, stating, 
“[a]t base, the execution of a warrant is not an exercise of rights by the peace officer; it is the performance of a mandatory duty, at the discretion of the court.” Because the peace officers have no discretion in executing a warrant, the court explained, a lawsuit based on such activity would not have the chilling effect the anti-SLAPP statute was enacted to prevent.

In Bikkina v. Mahadevan, 241 Cal. App. 4th 70 (2015), the plaintiff sued his former dissertation adviser for statements the adviser made about the plaintiff’s research and published papers. The trial court denied the anti-SLAPP motion and the court of appeal affirmed. In so doing, the appellate court held that the adviser’s comments were only made to the university faculty and plaintiff’s employer and thus, were “not made in a place open to the public or a public forum.” The appellate court rejected the defendant’s argument that the dispute related to a matter of public interest – climate change – because defendant’s comments and plaintiff’s papers only remotely related to the broader subject of climate change and did not contribute to the topic.

Courts also published opinions to make an important point about civility and to address potential abuse of the anti-SLAPP statute. In Finton Construction, Inc. v. Bidna & Keys, APLC, 238 Cal. App. 4th 200 (2015), the trial court granted the defendant law firm’s anti-SLAPP motion and dismissed a homebuilder’s action for conversion and receipt of stolen property for defendants’ alleged possession of a hard drive. On appeal, the court observed that “the lack of civility demonstrated in this case is a matter of public interest” and that the “type of uncivil behavior specious tactics demonstrated by filing this case” was a “particularly egregious SLAPP” such that the court not only ruled in defendants’ favor but chose to “publish this case as an example to the legal community of the kind of behavior the bench and the bar together must continually strive to eradicate.” Because the acts alleged in the complaint all arose out of defendants’ representation of their clients, the court held that the anti-SLAPP statute applied. The court also went on to hold that the claims were barred by the litigation privilege.

Olive Properties L.P. v. Coolwaters Enterprises, Inc., 241 Cal. App. 4th 1169 (2015) was published by the appellate court “to address the potential for abuse of the anti-SLAPP statute in unlawful detainer litigation.” In affirming the trial court’s denial of an anti-SLAPP motion because the unlawful detainer action did not arise from protected activity, the court explained that the unlawful detainer statues were adopted to provide an expeditious way of getting back property when a tenant fails to pay rent, but with the anti-SLAPP motion and its appeal, the tenant “succeeded in stalling the unlawful detainer action for a protracted period of time.”

In two separate opinions, courts explained that unlike in cases where nonclients bring causes of action against attorneys, the anti-SLAPP statute is not available in a claim brought by clients against their own attorney for malpractice. See Loanvest I, LLC v . Utrecht, 235 Cal. App. 4th 496 (2015); Sprengel v. Zbylut, 241 Cal. App. 4th 140 (2015).

PRONG Two: Did the Plaintiffs Show a “Probability of Prevailing” on Their Claims?

Several courts also addressed the second prong of the anti-SLAPP statute – whether a plaintiff met their burden of demonstrating with admissible evidence a “probability of prevailing” on their claims. Cal. Civ. Proc. § 425.16 (b)(1). Because the second prong depends on the cause of action, the allegations, and the admitted evidence, cases differ significantly. For example, in Grenier v. Taylor, 234 Cal. App. 4th 471 (2015), the court affirmed the denial of an anti-SLAPP motion for defamation and emotional distress brought by a church pastor and his wife against their stepson and a parishioner because the pastor was not a limited-purpose public figure for purposes of the action and plaintiff made a prima facie showing that defendants’ accusations made on a website that plaintiffs engaged in child molestation, misappropriated church funds, and sold and smuggled drugs were false and caused severe emotional distress. Contrastingly, in Barker v. Fox & Associates, 240 Cal. App. 4th 333 (2015), the appellate court reversed the trial court and dismissed the defamation lawsuit brought by a caretaker against a conservator of an elderly woman’s estate and others because the caretaker could not rely on allegations in her complaint that the defendants’ statements were defamatory per se and failed to demonstrate that the common-interest privilege did not apply absent a showing of malice.

In 2015, courts produced a mix of cases addressing malicious prosecution claims under the second prong of the anti-SLAPP statute. See Pasternack v. McCullough, 235 Cal. App. 4th 1347 (2015) (anti-SLAPP motion granted dismissing malicious prosecution claim because plaintiff could not prove the favorable termination element); Nunez v. Pennisi, 241 Cal. App. 4th 861 (2015) (reversing in part trial court’s denial of anti-SLAPP motion and holding that the plaintiff failed to establish a probability of prevailing in his malicious prosecution as to some of the defendants).

The Ninth Circuit also focused on the second prong of the anti-SLAPP statute in Davis v. Electronic Arts Inc., 775 F.3d 1172 (9th Cir. 2015), where the court affirmed the district court’s denial of an anti-SLAPP motion in a right-of-publicity lawsuit brought by former college football players against the developer of the Madden NFL video game because the developer failed to show that its unauthorized use of the former players’ likenesses qualified for First Amendment protection under the transformative use defense, the public-interest defense, the Rogers v. Grimaldi test, or the incidental-use defense. On Oct. 5, 2015, Electronic Arts filed a petition for a writ of certiorari with the U.S. Supreme Court raising the issue of “[w]hether the First Amendment protects a speaker against a state-law right-of-publicity claim that challenges the realistic portrayal of a person in an expressive work.”

Exemptions (When a Lawsuit Is Not Subject to the 
Anti-Slapp Statute):

In addition, the exemptions to the anti-SLAPP statute were analyzed in several cases.

In Association for Los Angeles Deputy Sheriffs v. Los Angeles Times Communications LLC, 239 Cal. App. 4th 808 (2015), the appellate court analyzed the “illegality” exemption, holding that a lawsuit for injunctive relief sought by a union representing county deputy sheriffs was not exempt from the anti-SLAPP statute because the publication of a news article derived from information in the deputy sheriffs’ confidential background investigation files was not “illegal as a matter of law.” Similarly, in Collier v. Harris, 240 Cal. App. 4th 41 (2015), an action brought by a political activist supporting a candidate in a school board election against a domain-name registrant for invasion of privacy, the court held that the “illegality” exemption was not satisfied because the plaintiff did not provide conclusive evidence to establish that the defendant’s alleged activity violated any statute.

The “public interest” exemption of CCP 425.17 (b) was applied in The Inland Oversight Committee v. County of San Bernardino, 239 Cal. App. 4th 671 (2015), and San Diegans for Open Government v. HAR Construction, Inc., 240 Cal. App. 4th 611 (2015). In The Inland Oversight Committee, the appellate court held that an action brought by plaintiffs to challenge an inverse condemnation settlement agreement under a state law forbidding public officers from having a financial interest in a public contract made by them in their official capacity was “necessary” as required under CCP 425.17(b)(3) because no public entity had sought to enforce the rights the plaintiffs wanted to vindicate and therefore the “public interest” exemption was satisfied. In San Diegans for Open Government, the “public interest” exemption was satisfied by a taxpayers’ action on behalf of a school district to recover contract payments made to building contractors.

The “commercial speech” exemption of CCP 425.17(c) was applied and found to exempt an action where Yellow and Bell cab services sued independent cab-service providers for false advertising of taxi services on the Internet because “no reasonable basis existed for asserting that the allegedly false advertisements constituted conduct in connection with an issue of public interest and was frivolous,” entitling plaintiffs to recover their attorneys’ fees under CCP 425.16(c). L.A. Taxi Cooperative, Inc. v. Independent Taxi Owners Association of Los Angeles, 239 Cal. App. 4th 918 (2015).

Anti-SLAPP Statute’s Odds and Ends

Helpfully, two courts reaffirmed that no amendments to pleadings are permitted after an anti-SLAPP motion is filed. In Bergstein v. Stroock & Stroock & Levan LLP, 236 Cal. App. 4th 793 (2015), no amendment was permitted because the plaintiff presented no proof that actually established a probability of prevailing on the merits. In Mobile Medical Services for Physicians and Advanced Practice Nurses, Inc. v. Rajaram, 241 Cal. App. 4th 164 (2015), the appellate court reversed a trial court’s order allowing plaintiff to file an amended complaint, explaining that the effect of giving leave to amend “was to allow [the plaintiff] to plead around the protected speech in the original complaint.” The court remanded the case and ordered the trial court to grant the defendant’s anti-SLAPP motion.

In Hewlett-Packard Co. v. Oracle Corp., 239 Cal. App. 4th 1174 (2015), the appellate court affirmed the trial court’s denial of an anti-SLAPP motion as untimely because it was filed on the eve of the second phase of a trial and 558 days after the 60-day requirement of CCP 425.16(f), stating “[i]n a pattern that has become all too familiar to the appellate courts of this state, the appeal, like the motion engendering it, is utterly without merit.” Further, after reviewing the purpose of the anti-SLAPP statute, the appellate court urged the legislature to limit the current right of interlocutory appeal under the anti-SLAPP statute to only those where the motion (a) is filed within the allotted 60 days and (b) would – if granted – dispose of the entire action. The Hewlett-Packard decision has rallied several critics of the anti-SLAPP statute to consider legislation to track the court’s legislative suggestion – so this is area to watch in 2016.

Despite the extensive body of case law that already exists, every year brings new wrinkles and interpretations of California’s anti-SLAPP statute. In 2016, we can look forward to a continued steady stream of anti-SLAPP appellate rulings, and potentially, the resolution of some important issues by the California Supreme Court or the legislature.


Thomas R. Burke is a partner in 
Davis Wright Tremaine LLP’s San Francisco office and is the author of Anti-SLAPP Litigation (The Rutter Group, 2015); Diana Palacios is an associate in the firm’s Los Angeles office.

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Rehitching the Horse: Oregon Court 
of Appeals Adjusts the Anti-SLAPP Cart http://www.medialawmonitor.com/2016/02/rehitching-the-horse-oregon-court-%e2%80%a8of-appeals-adjusts-the-anti-slapp-cart/ Tue, 02 Feb 2016 15:53:09 +0000 http://www.medialawmonitor.com/?p=3105 By Derek Green and Duane Bosworth

Although Oregon is in its 15th year of anti-SLAPP litigation under a decidedly robust statute, no Oregon appellate court had ruled on how to decide when Oregon’s anti-SLAPP statute applies until the recent decision in Mullen v. Meredith Corporation, 271 Or. App. 698 (2015). In that matter of first impression, the Oregon Court of Appeals corrected the “cart before the horse” approach taken by the trial court, which had ruled that a claimed tortious broadcast was not “protected speech” and thus did not fall within the scope of the anti-SLAPP statute.

Background

The plaintiffs, a state penitentiary guard and his wife, brought four claims arising out of a television news broadcast concerning gunfire in their neighborhood. The guard alleged that he allowed a reporter to film from his property on the condition that his image not be used in the news broadcast. He said he told the reporter he had received death threats from current and former inmates and needed to keep the location of his home unknown.

The initial evening news broadcasts did not include the guard’s image, but a subsequent morning news report was recut, and that version showed plaintiff outside his home for several seconds. The guard alleged that colleagues and multiple inmates saw him on television and that one inmate told plaintiff he now knew where he lived. Plaintiffs immediately left and put their home up for sale.

Plaintiffs sued defendants for: (1) breach of contract, based on a promise not to show plaintiff in the news report; (2) negligence, based on the broadcast of plaintiff’s image; (3) negligent infliction of emotional distress; and (4) intentional infliction of emotional distress.

Defendants moved to strike the three tort claims under the state’s anti-SLAPP law, ORS 31.150 et seq. The trial court denied the motion, finding that the anti-SLAPP statute did not apply to plaintiffs’ claims, and defendants appealed.

Court of 
Appeals Decision

Step One: Applicability

Among other matters, Oregon’s anti-SLAPP statute broadly applies to “any claim in a civil action that arises out of … any … conduct in furtherance of the exercise of … the constitutional right of free speech in connection with a public issue or an issue of public interest.” The trial court framed the issue of whether the anti-SLAPP statute should apply in terms of “whether defendants were entitled to show [plaintiff’s] ‘likeness,’ identity and location as part of the news broadcast.” The court concluded that showing the plaintiff was “not necessary” in order to convey the news. The court added that showing him, which was additionally a breach of contract, could not be “in furtherance of the exercise of … the constitutional right of free speech” because it was illegal and tortious. Showing plaintiff could not, therefore, be “protected speech” to which anti-SLAPP applies. Finally, the court concluded that plaintiff was not a public figure so showing him could not be “in connection with a public issue or an issue of public interest.”

In reversing the trial court, the Court of Appeals found:

“[A]t plaintiffs’ urging, [the court] narrowed the focus [of whether the anti-SLAPP statute applied] to the specific portion of defendants’ conduct that plaintiffs found objectionable. With respect, that inquiry puts the proverbial cart before the horse.”

In other words, whether speech or conduct is actionable is a matter for the second step of analysis under the anti-SLAPP statute, not the first step concerning applicability. The appellate court held that the trial court’s consideration of whether the objected-to speech was “necessary” was not proper. Similarly, the trial court’s consideration of whether plaintiff was a public figure was misguided and not itself probative of whether the anti-SLAPP statute applied. Instead, the appellate court noted, “as plaintiffs conceded, and the trial court recognized, ‘the news reports of the shooting constitute an issue of public interest.’” The court held that “it follows that plaintiffs’ claims arise from conduct in furtherance of the exercise of the constitutional right of free speech in connection with an issue of public interest.”

Analysis of the trial court’s ruling shows that it was confused by the frequently repeated appellate court statement that anti-SLAPP statutes apply only to “protected speech.” Some trial judges, as here, have believed they must first determine whether all of the speech in question is “protected,” that is, nonactionable, in order to decide whether the statute applies. That inquiry would make step-one analysis superfluous and would put “the cart before the horse,” as the appellate court noted.

Confusion arises from the imprecise use and understanding of the phrase “protected speech.” Anti-SLAPP statutes set out categories or kinds of speech to which the statutes apply. Those kinds of speech are “protected” in the sense that the special mechanism of anti-SLAPP analysis applies to them and accordingly claims may be quickly dismissed, often before discovery and with attorney fee assessments. Step-one analysis does not ask whether all speech at issue is “protected” in the sense of being “nonactionable,” only whether the speech is of the kind described, to which anti-SLAPP analysis applies.

Step Two: Probability of Success Regarding the Tort Claims

The decision in Mullen is the first Oregon appellate decision to reverse a trial court decision that the anti-SLAPP statute did not apply to the speech in question. Because of its initial decision, the trial court did not reach the second issue of whether plaintiffs had established “a probability that [plaintiffs would] prevail on a claim by presenting substantial evidence to support a prima facie case.” In ruling on a second issue of first impression, the appellate court held that because “that question was fairly presented to the trial court”—even though that court did not reach the question—“and the record was sufficiently developed to enable … review,” the appellate court could proceed to answer the “probability,” or second-step question.

The appellate court first set out the bases for this analysis. First, a court accepts as true all evidence favorable to the plaintiffs. Second, it considers the supporting and opposing affidavits submitted by both parties, but it does not weigh plaintiffs’ evidence against defendants’. Third, it considers defendants’ evidence and argument “only to determine if it defeats plaintiff[s’] showing as a matter of law.” Applying these standards, the court of appeals determined that plaintiffs had not established a prima facie case regarding any of the three tort claims; that is, plaintiffs had not provided evidence to support every element of any of the claimed torts.

Of particular interest, the court found that plaintiffs would need to have evidence of a “special relationship” between plaintiffs, on the one hand, and the station and reporter, Mark Hanrahan, on the other, in order to proceed with either the negligent publication or the negligent infliction of emotional distress claim, absent allegation of personal injury. As the court explained:

Here, defendant Hanrahan and plaintiff were strangers to each other before the agreement, which was limited to the term that defendants could come onto plaintiffs’ property if they agreed not to air plaintiff’s likeness. That agreement did not form a special relationship; defendants were not acting as plaintiffs’ agents, and plaintiffs did not relinquish control of matters to defendants that required them to exercise independent judgment on plaintiffs’ behalf. That is so because plaintiffs could not relinquish control of an activity—filming, editing or broadcasting a news report—that they never had in the first place. Thus, defendants did not owe a heightened duty to plaintiffs that would support a claim for noneconomic damages absent a personal injury.

Similarly, plaintiffs’ claim for intentional infliction of emotional distress failed because they could present no evidence that defendants intended to harm them. ”At most, defendants unreasonably failed to make all of their employees aware of the promise made to plaintiff and to prevent the harm that could follow from breaking that promise.”

The appellate court dismissed the three tort claims and remanded to the trial court for consideration of the contract claim only. While plaintiffs’ tort claims were for 
$1.5 million, the smaller amount they could obtain under the contract claim was less than the amount of attorney fees that were likely to be awarded against them; an award of reasonable attorney fees to a prevailing movant is mandatory under Oregon’s anti-SLAPP statute. As a result, the matter quickly ended when plaintiffs agreed to dismiss all claims with prejudice and without payment to any party.


Derek Green is Counsel and Duane Bosworth is a partner in Davis Wright Tremaine LLP’s Portland, Ore., office. DWT represented Meredith Corporation in this litigation.

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State Supreme Court Strikes Down Washington’s Anti-SLAPP Statute http://www.medialawmonitor.com/2016/02/state-supreme-court-strikes-down-washingtons-anti-slapp-statute-2/ Mon, 01 Feb 2016 18:49:22 +0000 http://www.medialawmonitor.com/?p=3108 By Bruce E. H. Johnson, Eric M. Stahl, and Ambika Kumar Doran

The Washington Supreme Court in May struck down the state’s 2010 anti-SLAPP statute, holding in a unanimous opinion that the law violates the state constitution’s right to a jury trial and is invalid on its face. The decision, Davis v. Cox, is the first in the nation to hold an anti-SLAPP statute unconstitutional. 351 P.3d 862; 183 Wn.2d 269; 2015 WL 3413375 (Wash. 2015).

The statute, RCW 4.24.525, provided a procedure for early and efficient disposition of lawsuits targeting “public participation and petition,” including petitioning as well as speech on issues of public concern. Like statutes in California and elsewhere, the law enabled defendants facing such claims to bring an early motion to strike, requiring the plaintiff to show at the outset that the claim had merit. The law also provided for attorneys’ fees and a statutory damages award to defendants who won an anti-SLAPP motion.

Davis held that the law violates the state constitutional protection for the right to trial by jury. Specifically, the court held that the requirement that a plaintiff “establish by clear and convincing evidence a probability of prevailing on the claim” meant the trial court had to weigh and decide disputed factual evidence, which is the purview of a jury. Until Davis, every court to interpret the law held the provision was akin to a summary judgment procedure, but the court found that to adopt that interpretation, it would have to rewrite the law. Instead, it held the law’s plain language requires a judge deciding an anti-SLAPP motion to rule on factual issues and dismiss even nonfrivolous claims if they do not meet the “clear and convincing” standard. That, the court held, “creates a truncated adjudication of the merits of a plaintiff’s claim” and “invades the jury’s essential role of deciding debatable questions of fact.”

Notably, the claims in Davis did not permit plaintiffs to demand a jury trial. The plaintiffs, five members of the Olympia Food Co-op, alleged purely equitable claims, arguing the defendants—former and current members of the Co-op Board—acted ultra vires and breached their fiduciary duties when the board adopted a boycott of Israel. The trial court dismissed the claims under the anti-SLAPP statute, and the Court of Appeals affirmed, both holding the plaintiffs had failed to satisfy a summary judgment standard. The Supreme Court did not weigh in on whether summary judgment was warranted, remanding the case.

Although plaintiffs in other cases in Washington state had argued the anti-SLAPP statute is unconstitutional, Davis was the first to squarely present the issue before the state Supreme Court. Opposition to the law was spearheaded by the Washington State Association for Justice Foundation, a trade association for plaintiffs’ attorneys. The association was joined by the American Civil Liberties Union (ACLU) of Washington and the Washington Employment Lawyers Association. Although the ACLU has consistently supported anti-SLAPP laws in other states, including by opposing similar constitutional challenges, the Washington state chapter has taken a different position on the anti-SLAPP law and other state legislation protecting the public’s right of participation and petition—such as by supporting privacy-based exemptions to public-records access, new rules making it easier to seal criminal court records, and legislation criminalizing certain ads that a court ultimately 
declared unconstitutional.

Amici in support of the statute included the State of Washington, the Reporters Committee for Freedom of the Press, 26 major news media organizations, and several organizations that support Palestinian rights.

Davis is significant because it holds the anti-SLAPP statute unconstitutional on its face, meaning it cannot apply in any circumstance. Because the basis for the decision is the state constitution, the Washington Supreme Court’s opinion is the last word, pending any future legislative fix. Media defendants and other SLAPP victims have therefore lost an important protection against baseless lawsuits targeting their First Amendment activities, at least for now.


The authors are all partners in
Davis Wright Tremaine LLP’s Seattle office. DWT represented the defendants in Davis v. Cox, along with the Center for Constitutional Rights.

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D.C. Circuit Rules Anti-SLAPP Law Inapplicable in Federal Court, Highlighting Need for Federal Anti-SLAPP Law http://www.medialawmonitor.com/2016/01/d-c-circuit-rules-anti-slapp-law-inapplicable-in-federal-court-highlighting-need-for-federal-anti-slapp-law/ Fri, 29 Jan 2016 18:46:47 +0000 http://www.medialawmonitor.com/?p=3110 By Lisa B. Zycherman

In April, the D.C. Circuit held that the District of Columbia anti-SLAPP statute does not apply in a federal court diversity case because “Federal Rules 12 and 56 answer the same question as the anti-SLAPP Act’s special motion to dismiss provision.” The court’s decision provides an obvious opportunity for forum shopping in Washington, D.C., where libel plaintiffs are incentivized to file suit in federal court where anti-SLAPP protections are now inapplicable.

The case, Abbas v. Foreign Policy Grp., LLC, 783 F.3d 1328 (D.C. Cir. 2015), was a libel suit brought by Yasser Abbas, the son of Palestinian Authority President Mahmoud Abbas, against the Foreign Policy Group, publisher of Foreign Policy, and its reporter, Jonathan Schanzer. The action concerned an article about the plaintiff, which noted his wealth and posed rhetorical questions like, “Are the sons of the Palestinian president growing rich off their father’s system?” and “Have they enriched themselves at the expense of regular Palestinians?” Abbas sued in the U.S. District Court for the District of Columbia claiming the questions posed in the article defamed him. The defendants moved for dismissal pursuant to the District’s anti-SLAPP statute and won. Abbas appealed.

Although the defendants argued that the standard under the anti-SLAPP act mirrors Rule 56 and thus does not conflict with the federal rules, the D.C. Circuit rejected this argument as contrary to the intent of the D.C. Council and the language of the statute. The court concluded that Federal Rules of Civil Procedure 12 and 56 address “the circumstances under which a court must dismiss a case before trial,” meaning that the D.C. anti-SLAPP statute, which imposes a higher burden, cannot apply in federal court diversity actions. The D.C. Circuit acknowledged that other courts, including the 1st, 5th and 9th Circuits, have all held that anti-SLAPP statutes apply in federal court, notwithstanding Rules 12 and 56, but disagreed with those decisions, explaining that they are “not persuasive.” The court’s decision created a circuit-split as to whether anti-SLAPP statutes should apply in federal court alongside the federal rules.

Notwithstanding the court’s agreement with Abbas that the D.C. anti-SLAPP statute does not apply in a federal court diversity case, the D.C. Circuit affirmed dismissal of Abbas’ action on the basis that the questions posed in the article were not factual representations and thus not defamatory. It dismissed Abbas’ claims under Rule 12(b)(6) – a motion that the defendants made below, but which the district court found to be moot when it granted the anti-SLAPP motion.

The D.C. Circuit’s Abbas decision has serious consequences for litigants in the District. Libel defendants sued in federal court are unable to move for early dismissal under the D.C. anti-SLAPP statute. And defendants sued in D.C. Superior Court who are able to remove the case to federal court because of diversity jurisdiction are divested of any right to seek early dismissal in federal court under the D.C. anti-SLAPP law. In sum, the Abbas decision promotes precisely the type of forum-shopping the Supreme Court’s Erie decision was designed to avoid. Until Congress passes a federal anti-SLAPP statute or the D.C. Circuit or Supreme Court hold that anti-SLAPP statutes apply in federal court, D.C. plaintiffs will file their libel cases in federal court to avoid a possible anti-SLAPP motion.


Lisa B. Zycherman is an associate in Davis Wright Tremaine LLP’s Washington, D.C. office.

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Is Everything Going to Be OK? Whether Individual Emoji Are Copyrightable http://www.medialawmonitor.com/2016/01/is-everything-going-to-be-ok-whether-individual-emoji-are-copyrightable/ Thu, 21 Jan 2016 18:50:28 +0000 http://www.medialawmonitor.com/?p=3044 By Jason Harrow

The editors of Oxford Dictionaries recently named JH1 the word of the year in 2015. [1] No, that is not a strange typo: The word of the year really was an emoji. But which one was it? While the title of the article displayed the emoji using Apple’s character set, the first sentence of the explanatory blog post used a different character set and printed that JH2 is the word of the year.

Of course, the two renderings were of the same emoji. The characters looked different because they were in different emoji “fonts”: The headline emoji, which appears rounder and with smaller, brighter tears, came from Apple Color Emoji, but the in-text version that looks flatter and has bluer tears is from Twitter’s character set.[2]

Oxford’s use of two different emoji character sets gives rise to a question that has become increasingly relevant as emoji use has exploded around the globe: Could either of those versions of “face with tears of joy” be subjected to copyright protection? And, if so, does that mean that a publisher or media outlet might be committing copyright infringement when it chooses to display messages or text containing particular emoji characters?

This is a difficult question, as there is little relevant case law or congressional guidance regarding whether emojis are protected under the Copyright Act. But this article argues that emojis may well not be copyrightable because emoji sets are typefaces, and typefaces have long been held to be uncopyrightable. Nonetheless, the copyrightability of emojis is unsettled, so there would be some risk in treating an emoji set as not subject to copyright.

Typefaces “as typeface” are not copyrightable.

Before discussing whether emojis are subject to copyright, it is important to understand that, according to the Copyright Office and the federal courts to have examined the issue, typefaces are not copyrightable.

Congress actually considered the issue of typeface copyright when it passed the 1976 Copyright Act, though nothing about typefaces appears in Title 17 of the U.S. Code. Instead, the Committee on the Judiciary stated in the House Report that accompanied the Act that it had “considered, but chosen to defer, the possibility of protecting the design of typefaces.”[3] The Committee stated that it “does not regard the design of typeface . . . to be a copyrightable ‘pictorial, graphic, or sculptural work’” within the meaning of the Copyright Act.[4] The committee also defined typeface “as a set of letters, numbers, or other symbolic characters, whose forms are related by repeating design elements consistently applied in a notational system and are intended to be embodied in article whose intrinsic utilitarian function is for use in composing text or other cognizable combinations of characters.”[5]

As the House Report indicates, the view that typefaces are not copyrightable is longstanding. Indeed, the leading appellate case to have considered the issue, Eltra v. Ringer, noted that “typeface has never been considered entitled to copyright” under the 1909 Act. Accordingly, the Eltra court in 1978 affirmed the Copyright Office’s rejection of an application to register a then-new typeface called “Orion.”[6] The court reasoned that typeface is not copyrightable because it “is an industrial design in which the design cannot exist independently and separately as a work of art.” The U.S. Court of Appeals for the Ninth Circuit has also noted that “typefaces are not afforded copyright protection.”[7] The Copyright Office has followed the view of the House and the 4th Circuit and has promulgated a rule that applications for registration of “typeface as typeface” will “not be entertained.”[8]

But this does not leave font designers in the digital age entirely without copyright protection for their work. As the Copyright Office explained in its rulemaking, type designers can register copyrights in the font software used to create and display their typefaces on computers.[9] Font makers can then license that software, even though the actual letters and numbers produced by the software would be unprotected under copyright law.[10] Type designers have additional ways to protect their design work, including by trademarking the name of the font.[11]

The fact that typefaces are not copyrightable means that the wholesale copying of typefaces is not prohibited by copyright law, so long as the copier is able to draw the figures by hand or otherwise reproduce the letters and figures without copying any software code. And, although this seems like a difficult result for professional typeface designers, in fact one scholar reports that “many professional font designers are quite happy with this result.” [12] That is because having “the copyright in the code gives the company the necessary head start in the market, after which it is not necessarily a problem if a competitor recreates the resulting typeface design from scratch without copying the protected code.” Plus, “some degree of copying is necessary and accepted,” since a typeface can only be useful as a typeface if each figure is recognizable as the given letter, number, or symbol it represents.[13]

Emoji sets could be considered uncopyrightable typefaces

When emojis were first created in Japan in the 1990s, they were a series of proprietary symbols that individual mobile companies created for their users. But now that emojis have evolved, it is becoming clear that emoji character sets implement a kind of universal pictorial language of our digital age. Accordingly, there is now a strong argument that emoji sets should be considered typefaces implementing the emoji “language” and therefore are not protectable under federal copyright laws.

Although the Copyright Act does not contain a definition of typeface, the legislative history does. The House Report defines typeface as “a set of letters, numbers, or other symbolic characters, whose forms are related by repeating design elements consistently applied in a notational system and are intended to be embodied in article whose intrinsic utilitarian function is for use in composing text or other cognizable combinations of characters.”[14] Under that definition, emoji sets could be considered typeface. As the committee recognized, typeface need not be only letters or numbers, but can also be “symbolic characters.” Thus, emojis could potentially be considered typeface so long as they meet the other requirements.

The key to being considered a typeface, then, should be whether emojis serve a “utilitarian function” in a “notational system” with a “cognizable combination of characters.” It is becoming clear that emojis also meet this requirement. Emoji character sets no longer consist of whatever sets of symbols that the manufacturer may wish to include[15] but now conform to standards set by Unicode, which is the international consortium that writes specifications to “enable[] people around the world to use computers in any language.”[16]

These Unicode standards are the equivalent of the specification for transmitting and displaying character sets in any other language. For instance, just as the familiar basic Latin forms have been assigned standard hexadecimal codes — a lowercase “m” is 006D, for instance — so too does each individual emoji now have a code — “smiling face with sunglasses” is 1F60E.

From there, in just the way that a smartphone displays a lowercase “m” differently based on whatever font is selected, a modern smartphone also displays the “smiling face with sunglasses character” according to whatever emoji “font” set is enabled. Apple uses Apple Color Emoji, which displays that character like this: JH3. The Android character set looks like this: JH4. And both of those are variations of the Unicode “standard” for that character, which is rendered in black-and-white and looks like this: JH5.

These emoji characters have important aesthetic differences among them. But just because the designer made aesthetic decisions — should the face be round or another shape? — does not mean the resulting emojis are pictorial or graphic works subject to copyright protection. Instead, the aesthetic choices likely constitute the industrial design of a set of utilitarian symbols whose purpose is to represent characters in the emerging “notational system” that is the emoji language.[17] Viewed this way, emoji characters are the building blocks of a new, global digital language — and should be treated in the way that the building blocks of our pre-existing languages are treated. In fact, given the exploding popularity of emojis, some typeface designers have speculated that an emoji set (perhaps Apple Color Emoji) may well end up as the signature typeface of the 21st century.[18]

The Copyright Office, too, recognizes that typeface can extend beyond minor variations of a standard alphabet. Its Compendium of U.S. Copyright Office Practices notes that it refuses typeface registration “regardless of how novel and creative the shape and form of the typeface characters may be.” Rather, a “typeface character cannot be analogized to a work of art, because the creative aspects of the character (if any) cannot be separated from the utilitarian nature of that character.”[19] Here, too, where emoji sets implement the standard Unicode character set, it is hard to separate the unique creative aspects of one rendering of “face with tears of joy” from its ability to be used as a character in the emoji alphabet.

This concept of a set of symbols that convey complex meanings may seem strange to native English speakers, but phonemic alphabets (like the Latin alphabet that this article is primarily written in) are not the only way to construct a writing system. Rather, the use of logograms or pictograms in written language has both ample historical precedent, such as Ancient Egyptian Hieroglyphs, and continued usage, such as Chinese characters.[20] Few would contend that Chinese character sets should be copyrightable as typeface even though typefaces depicting the Latin alphabet should not. The same principle could well be applied to emojis.

Counterarguments

Admittedly, we may be too early in the life of emojis for a court to declare emoji sets uncopyrightable works of typeface design. There are some factors that point toward an argument that emoji characters should be copyrightable works of visual art.

One might argue that individual emojis can be appreciated for their individual aesthetic properties to a greater extent than individual letters can — elevating them to works of “pictorial” or “graphic” art. After all, unlike Latin characters, emojis are so closely representational of their underlying meaning: the smiling face with sunglass emoji looks like … well, a smiling face with sunglasses, as opposed to these jagged forms we call letters that call to mind a given image. But what makes emojis “artistic” in this way is also precisely what makes them so universally useful: Emojis constitute a kind of writing “whose fundamental unit is not the word” but, maybe, “something better.”[21] Emojis thus still could be considered “useful articles” even though many of them are representational of the ideas they are meant to convey.

From a legal perspective, a search of Copyright Office records reveals that only one company has so far tried to register its emoji characters in a comprehensive way: Apple. That is, the Copyright Office has recently registered as “2-d artwork” at least some of Apple’s emoji characters as they existed in 2008 and 2011. But the fact Apple has several hundred registrations for individual emoji characters (plus a registration for its “typeface palette” in iOS 3.2) is far from conclusive proof that the characters are copyrightable.[22] After all, the issuance of registrations from the Copyright Office is only some evidence that a work may be copyrightable; ultimately, that determination must be made by a court.[23] If Apple were forced to defend the copyrightability of these individual characters, it could face some problems.

In particular, the title of the registrations undermines somewhat Apple’s case for copyrightability of emojis as “artwork.” Almost all of the registrations use the word “typeface” in the title: for instance, there are a number of registrations for “Apple Emoji 2008 typeface,” followed by a category signifier (“PPL” for people; “OBJ” for object), and then, frequently, a unique identifier that includes the Unicode hexadecimal code. More recent registrations are titled with the pattern “Apple Emoji 2011 typeface for OS X” followed by a descriptor, like “WOLF FACE,” “CLOSED BOOK,” or “SEEDLING.”

This titling is potentially problematic for a couple of reasons. First, the fact that “typeface” appears in the title of the works should have signaled to the Copyright Office that the submissions were part of an unregistrable typeface according to its own regulations; it is unclear if Apple addressed that issue in its submission. Second, the fact that many of the submissions are identified by their Unicode hexadecimal code also makes explicit that those symbols are implementations of a standardized set of symbols, not a set of proprietary symbols that Apple designed on its own. Thus, it is far from clear that all of these registrations will hold up in an infringement suit, at least if the suit is brought against someone who simply displays the typeface but who has not copied any of Apple’s software code.

Practical advice

There are only a few cases addressing the copyrightability of typefaces, and there is none discussing the copyrightability of emojis. Obviously, then, the IP status of emoji is new, untested legal ground. What should best practices be for media organizations that wish to use or display emojis created by Apple, Google, Samsung or any other company that may assert copyrights in the character sets they created?

One option is to treat emojis as you would other commercial typefaces, as proposed in this article. A more conservative option would be to treat particular emojis as works of visual art and ensure that each particular display of a given emoji is properly licensed.[25] An organization may also wish to create its own emoji set based on the Unicode standard to avoid copyright issues.[26] Organizations that choose this option should probably be careful not to copy Apple’s emoji set verbatim, but, just as close copying is common for Latin-based typefaces, close copying might also be acceptable in the realm of emojis.

In all events, however, media organizations should take care to make sure not to copy the software code for an emoji font set without authorization; this would be a clear copyright violation. They should also be careful not to use copyrighted code as the basis for creating a new emoji set.

It will also be important to monitor how emojis are used over the next several years. Languages evolve, and emojis will too. If emoji usage continues on its current path, we may see an explosion in both emoji “font” design and acceptable usage of emojis in new and surprising ways. If that is the case, the argument that emoji sets are typefaces for our new universal language will only grow stronger.

 

FOOTNOTES

[1] http://blog.oxforddictionaries.com/2015/11/word-of-the-year-2015-emoji/.

[2] A comparison of the way “Face With Tears of Joy” looks in those and other character sets can be found at: http://emojipedia.org/face-with-tears-of-joy/

[3] H.R. Rep. 94-1476 at 55.

[4] Id.

[5] Id.

[6] Eltra v. Ringer, 579 F.3d 294 (4th Cir. 1978); see also Eltra v. Ringer, 194 U.S.P.Q. 198 (E.D. Va. 1976).

[7] Monotype Corp. PLC v. International Typeface Corp., 43 F.3d 443, 446 (9th Cir. 1994).

[8] 37 C.F.R. § 202.1.

[9] 57 Fed. Reg. 6201–02 (1992).

[10] Adobe Sys. Inc. v. S. Software Inc., No. 95-cv-20710, 1998 WL 104303, at *3–4 (N.D. Cal. Feb. 2, 1998).

[11] See Monotype Corp. PLC v. Int’l Typeface Corp., 43 F.3d 443, 446 (9th Cir. 1994).

[12] Jacqueline D. Lipton, To © or Not to ©? Copyright and Innovation in the Digital Typeface Industry, 43 U.C. Davis L. Rev. 143, 174 (2008).

[13] Id. at 169.

[14] H.R. Rep. 94-1476 at 55 (emphases added).

[15] In Japan in the 1990s, each carrier had its own noncompatible emoji sets, resulting in a “jumble of different proprietary approaches.” http://www.theverge.com/2013/3/4/3966140/how-emoji-conquered-the-world.

[16] http://www.unicode.org/

[17] As one commentator recently argued, a given emoji character is “a discrete and combinable written element that conveys semantic . . . meaning.” http://www.vice.com/read/sam-kriss-laughing-and-crying?utm_source=vicetwitterus.

[18] https://www.quora.com/Aesthetics/Is-there-a-typeface-for-the-21st-century-as-Helvetica-was-to-the-20th

[19] U.S. Copyright Office, Compendium of U.S. Copyright Office Practices (3d Ed. 2014) at § 906.4. The Compendium notes that “simple emoticons, such as the typical smiley face” are unregistrable on the grounds that they fall into the category of “well-known and commonly used symbols.” Id. § 313.4(J). While it may be difficult to argue that an entire digital language composed of hundreds of emojis would all be unregistrable as “well-known symbols” — though perhaps emojis’ explosion in popularity will change that conclusion — certain emojis that do implement well-known symbols would not be subject to copyright on these independent grounds.

[20] http://www.omniglot.com/writing/semanto-phonetic.php.

[21] http://www.vice.com/read/sam-kriss-laughing-and-crying?utm_source=vicetwitterus

[22] The registrations can be found by searching Copyright Office records using the keyword “emoji.”

[23] See 17 U.S.C. § 410. Moreover, as a technical matter, it appears that some of Apple’s registrations may not come with a presumption of validity, because they were not filed within five years of first publication. See 17 U.S.C. § 410(c).

[24] 17 U.S.C. § 410.

[25] Or, if emoji are treated as works of visual art, certain uses also may be permissible because they are fair. Oxford’s use of particular emoji characters in an article about emojis, for instance, is likely a fair use. Displaying a person texting using particular emojis may also be a fair use.

[26] The full list of emoji can be found at http://unicode.org/emoji/charts/full-emoji-list.html.

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Digital Emotions: The Evidentiary Impact of Emoticons and Emojis http://www.medialawmonitor.com/2016/01/digital-emotions-the-evidentiary-impact-of-emoticons-and-emojis/ Wed, 20 Jan 2016 19:01:32 +0000 http://www.medialawmonitor.com/?p=3056 By Karen A. Henry and Jason Harrow

When computer science professor Scott Fahlman posted a sideways smiley face on an electronic message board at Carnegie Mellon University in 1982, he could not possibly have known that combination of dots and dashes would give birth to a whole new digital language.  Indeed, what started with a single  : – ) has become a deluge: Instagram recently reported that emojis appear in roughly half of the many millions of comments and captions added to online photos each day.  And emojis are practically taking over Twitter: The “face with tears of joy” emoji alone ()  has appeared in nearly 1 billion tweets in the past two years.

As emoticons, and especially emojis, explode in popularity and appear in more of our written communications, they inevitably raise legal questions. For instance, can an emoticon or emoji change the meaning of an email, text message, online chat, or blog post in which it appears? Do emoticons and emojis tell us something about the author’s state of mind? And how should emoticons and emojis be described to juries or displayed in court opinions? These are just a few of the questions courts are grappling with, and while definitive answers remain elusive, the legal landscape is very much under construction.

Emoticons vs. Emojis
Many people use the terms “emoticon” and “emoji” interchangeably, but while these symbols may belong to the same digital family, they are distinct.

Emoticons are the simpler of the two kinds of symbols. Emoticons are groups of keyboard characters—mostly punctuation marks—that are used to represent facial expressions.  Anyone with a keyboard can send and receive an emoticon. Examples include happy faces, like : -) or : ), kissing faces, like :*, expressionless faces, like :|, and many, many more. Emoticons are usually used to express emotion or assist the reader in some way in interpreting the text—by, for instance, expressing the idea that the preceding sentence was just a joke. :-P. [Yes; that is supposed to be a face with a tongue sticking out.]

Emojis, in contrast, are emoticons’ younger, more sophisticated, cousins. They are detailed, pictographic symbols, not just symbols made up of pre-existing keyboard characters.  Sending and receiving emojis therefore requires software that can display hundreds of unique characters, from the aforementioned “face with tears of joy,” to country flags, aliens, sports equipment, vehicles, hearts and many other symbols—including one perplexing new addition, “man in business suit levitating” ().

Although invented in Japan in the late 1990s, the use of emojis has exploded in the past five years, after character symbols were added to an international character standard called Unicode. Many smartphone software platforms, notably Apple’s iOS and Google’s Android, then added built-in support for emoji characters through the use of different virtual keyboards that users easily can activate. Thus, just as international users may toggle to a new keyboard to input Chinese characters or Hebrew letters, so too may smartphone users now input emoji characters at the touch of a button. The fact that hundreds of millions of smartphone users have instant access to the wide range of emoji characters has led to an explosion of emoji usage around the globe.

Emoticons and Emojis as Evidence
With so many emojis and emoticons being transmitted online and in text messages, it was inevitable that they would end up in communications used as evidence in court cases. But what do they mean? And, equally important, when their meaning is in dispute, who should resolve the conflict—the court or the jury? While these questions recently have arisen in a variety of civil and criminal cases, the answers remain largely unsettled.

For instance, the evidentiary value of emoticon/emoji evidence was examined fairly recently in Lenz v. Universal Music Corp. (widely referred to as “the Dancing Baby” case).  In that case, plaintiff Stephanie Lenz moved for summary judgment on six affirmative defenses asserted by Universal in response to Lenz’s copyright claim. Of particular relevance, Universal argued Lenz alleged in bad faith that she had been “substantially and irreparably injured” by its takedown notice. To support this argument, Universal proffered an email exchange between Lenz and her friend. In that exchange, the friend writes, “love how you have been injured ‘substantially and irreparably’ ;-).”  Lenz, in turn, responds, “I have ;-).”

Universal contended that Lenz’s use of the “winky” emoticon signified that she was “just kidding.” Lenz countered that her use of the “winky” emoticon replied to the “winky” in her friend’s email, which basically was teasing Lenz about using “lawyerese” in her complaint—i.e., “substantially and irreparably injured.” The court sided with Lenz, finding Universal’s proffered evidence insufficient to prove Lenz acted in bad faith and granting summary judgment in Lenz’s favor on that affirmative defense.

Emoticon and emoji evidence also has been examined in two recent, high-profile criminal cases. In the so-called “Silk Road” trial in the Southern District of New York, for example, defendant Ross Ulbricht was charged with operating an online drug market. Much of the evidence against him consisted of emails and chat logs containing various emojis and emoticons. Initially, the prosecution read the logs to the jury without mentioning these symbols. After the defense objected, however, the court required the prosecution to note to the jury the presence of “the punctuation and emoticons” in the logs because they were “part of the evidence of the document.”  This lead to the prosecution saying the word “emoticon” in place of each symbol, although the prosecution apparently did not describe the actual symbol or attempt to convey its intended meaning.  Eventually, the defendant was convicted on all counts. Perhaps the U.S. 2nd Circuit Court of Appeals will be forced on appeal to decide whether this solution was adequate to convey the information contained in the chats.

The U.S. Supreme Court recently was presented with emoticon evidence in a case dealing with the interpretation of a statute prohibiting threatening communications. The defendant in Elonis v. United States had argued that his conviction for posting threatening communications on Facebook should be reversed in part because the presence of emoticons in some of the posts made them “subject to misunderstandings” and not as threatening as they would otherwise have been.  For example, one of the defendant’s posts said that his son should dress up as “matricide” on Halloween, perhaps by wearing a costume of her “head on a stick.” He followed that post with an emoticon of a face with its tongue sticking out. He argued that the emoticon signaled that he was joking, but his wife interpreted the tongue sticking out in that context as an insult.

Ultimately, the Supreme Court did not wade into the meaning of that emoticon, nor signal how emoticons should be presented or interpreted. Rather, it reversed the conviction without reference to that post or the complications that emoticon evidence may pose.  Thus, any definitive statement on the federal law of emojis and emoticons will have to wait for another day.1

The Next Frontier: Embracing Emoticons and Emojis
Perhaps because many judges have not found most emojis or emoticons to be critically important to the interpretation of a piece of evidence, many recent opinions do not actually display specific emoticons or emojis. Instead, like the court in the “Silk Road” case, they simply note their presence. Thus, court opinions have contained bracketed descriptions saying “[winking smiley face emoticon]”; noted that one text message under consideration contained “a winking emoticon as punctuation”; or stated that a tweet contained “[five laughing emojis].”  In contrast, one recent district court opinion from a federal court in Connecticut actually reproduced a smiley-face emoji contained in an important email and then used the novel parenthetical “emoji in original” to indicate that the email had been reproduced accurately.

Both approaches have their benefits, but courts should be encouraged to include actual emojis and emoticons in their opinions when possible. After all, as emoji use has exploded, so too have the number of emojis contained in the Unicode standard. The Unicode standard now supports more than 800 of them; the Apple emoji character set, which allows for additional modifications of some emojis, now has 1,620 distinct emojis.  With this many emojis, it is difficult to pin down which one is the “laughing emoji” to which the court above might have been referring. Was it “grinning face” ()? “Grinning face with smiling eyes” ()? “Face with tears of joy” ()? Or perhaps it was “smiling face with open mouth and smiling eyes” (). The point is that with more than 1,000 possibilities, noting the presence of an emoji conveys very little information; describing it conveys some more but can still lead to confusion with this many options. Since emojis can contain such nuanced information—the days of a simple smiley face have given way to a character set of about 70 different facial expressions —it will soon become imperative to show the characters themselves so that the reader can understand the information conveyed by the emoji.

But courts and litigants must exercise caution when they select the emojis to incorporate into opinions or show to a jury. Emoji character sets display differently on the various platforms: for example, the “alien monster” emoji looks playful in LG’s character set (), like an old video-game alien on an iPhone (), but downright scary in Samsung’s Galaxy S5 set ().  Which one did the sender mean to convey? Which should be shown to a jury?

These are difficult questions that most courts have not yet begun to consider. But many more meaningful encounters with emojis are doubtless coming soon, as more and more of our written communications incorporate them. Whether judges will embrace this new form of communication and view emojis through a “smiling face with smiling eyes” () or the more dour “face with cold sweat” () is still to be determined.

FOOTNOTE

1 Not surprisingly, courts in the United States are not the only ones facing these issues. Emoticons and emojis are used on a global scale and courts in other countries also are faced with evaluating emoticon/emoji evidence. For instance, in McAlpine v. Bercow, [2013] EWHC 1342 (QB), the English courts concluded that an “*innocent face*” emoticon included in a tweet linking Lord McAlpine — the former Deputy Chairman of the Conservative Party — with a child-molestation scandal did not shield the tweet’s author from liability for defamation.

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The Dancing Baby Grooves to Mixed Victory in the 9th Circuit: Court Holds that DMCA Takedown Notices Require Consideration of Fair Use http://www.medialawmonitor.com/2016/01/the-dancing-baby-grooves-to-mixed-victory-in-the-9th-circuit-court-holds-that-dmca-takedown-notices-require-consideration-of-fair-use/ Tue, 05 Jan 2016 19:11:41 +0000 http://www.medialawmonitor.com/?p=3066 By Lance Koonce and Nicolas A. Jampol

Behind the scenes of the Internet’s current swirl of memes, mashups and other viral content is a massive system of takedown notices and counternotices passing back and forth between content owners, web hosts and users, intended to quickly eliminate infringing material that gets posted by users, while providing users the opportunity to object when they believe their postings have been unfairly removed.

This system was created by the mandates of the Digital Millennium Copyright Act (DMCA), and most of the major disputes that have arisen regarding the structure of the system have turned on a single question, variously applied: Whose burden is it? Should Web hosts have a duty to filter incoming content or not? What triggers sufficient knowledge of infringement for a Web host, such that it has a duty to remove content? And in the most recent decision by the 9th U.S. Circuit Court of Appeals on point, does a copyright owner have the burden to affirmatively consider fair use before sending a takedown notice? Given the scale of the takedown regime, the answers to these questions can cause tectonic shifts in respective financial burdens.

In Lenz v. Universal Music Corp., 9th Cir. Nos. 13-16106 and 13-16107 (Sept. 14, 2015), the 9th Circuit held that copyright holders must consider whether an apparently infringing use qualifies as a fair use before sending a takedown notice under the DMCA, and the failure to do so exposes the copyright owner to possible liability for damages under 17 U.S.C. § 512(f). At the same time, the court clarified that a copyright holder need not get the fair use analysis right, it must merely have a subjective good-faith belief that the use was infringing.

While most large content providers have already altered (where necessary) their practices following the lower court’s holding in 2013, the Lenz decision highlights the central role of fair use in the modern copyright ecosystem and the need for copyright holders to carefully assess their claims. It also suggests that users who file lawsuits for improper takedowns will face a heavy evidentiary burden to actually prove a takedown was wrongfully issued.

Background: The Dancing Baby

It may feel like years since the so-called “Dancing Baby” copyright case was last in the news because it has been years. So many viral videos — including too many other dancing babies to count — have come and gone since the YouTube video at the heart of the Lenz case was first introduced into our collective bloodstream back in 2007, a lifetime ago in the Internet era, where full-blown Internet phenomena are measured in weeks, if not days (Harlem Shake anyone?).

After Stephanie Lenz uploaded to YouTube a 29-second home video of her two young children dancing to the song Let’s Go Crazy by the artist once-and-again known as Prince, Universal Music sent a takedown notice directing YouTube to remove the video as infringing. The notice included the following statement required under 17 U.S.C. § 512(c): “We have a good faith belief that the above-described activity is not authorized by the copyright owner, its agent, or the law.” Over eight years of litigation (with no end in sight) would turn on that last clause, “or the law.”

After YouTube notified Lenz of the takedown notice, she sent counternotifications that resulted in YouTube reposting the video, where it remains today, having garnered more than 1.3 million views (see https://www.youtube.com/watch?v=N1KfJHFWlhQ). Lenz filed suit, claiming that Universal Music misrepresented in the takedown notice that the video was infringing, and the case has been winding its way through the courts ever since (during which time the subject of the video has presumably abandoned onesies, Prince, and the innovative dancing style showcased in the video).

A Brief Primer on Fair Use

The Copyright Clause in the U.S Constitution strikes a bargain between creators and the public: “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” In other words, the government gives creators a limited monopoly over their (original) works in exchange for bringing those works to the public.

The concept of fair use is an exception to this monopoly, pursuant to which copyrighted works can be used for certain purposes without the copyright owner’s permission. While it is difficult to predict with any accuracy what uses courts will deem “fair” under the Copyright Act, the statute provides four factors that must be weighed, including the purpose and character of the use (and specifically, as interpreted by the courts, whether the use “transforms” the original for a different purpose), the nature of the copyrighted work, the amount of the portion used, and the impact of the use on the market for the original work.

While the underlying question in the Lenz case was whether a noncommercial, yet publicly shared, home video of toddlers dancing to a copyright-protected work qualified as a fair use, the specific legal question that played out in the courts was different: whether Universal was required to expressly consider whether the video was a fair use of Prince’s song before sending a takedown notice under the DMCA.

The 9th Circuit Decision

On Sept. 14, 2015, the 9th Circuit ruled that a copyright owner cannot claim a good-faith belief that a use is not authorized by the law without first considering whether the use is permitted under the fair-use doctrine. The court held that “the statute unambiguously contemplates fair use as a use authorized by the law.” While Universal argued that fair use is merely an affirmative defense that excuses otherwise infringing conduct, the court disagreed, finding that, under the Copyright Act, a fair use is not an infringement in the first place.

After deciding that a copyright owner must have a “good faith belief” that a use is infringing (and thus not a fair use) to issue a takedown notice under § 512(c), the court turned to what exactly constitutes such a belief. The court explained that the law requires only a subjective, not objective, good-faith belief of infringement, and that the court will accept a copyright owner’s belief that a use was not fair “even if we would have reached the opposite conclusion.” The court further held:

[A] copyright holder’s consideration of fair use need not be searching or intensive. . . . [F]ormation of a subjective good faith belief does not require investigation of the allegedly infringing content. . . .We are mindful of the pressing crush of voluminous infringing content that copyright holders face in a digital age. But that does not excuse a failure to comply with the procedures outlined by Congress.

The court cautioned, however, that “if a copyright holder ignores or neglects our unequivocal holding that it must consider fair use before sending a takedown notification, it is liable for damages under §512(f)” and “[a] copyright holder who pays lip service to the consideration of fair use by claiming it formed a good faith belief when there is evidence to the contrary is still subject to §512(f) liability.”

In dicta, the court also suggested, “without passing judgment,” that use of computer algorithms as a first cut in the analysis was “a valid and good faith middle ground for processing a plethora of content while still meeting the DMCA’s requirements to somehow consider fair use”:

For example, consideration of fair use may be sufficient if copyright holders utilize computer programs that automatically identify for takedown notifications content where: “(1) the video track matches the video track of a copyrighted work submitted by a content owner; (2) the audio track matches the audio track of that same copyrighted work; and (3) nearly the entirety . . . is comprised of a single copyrighted work.”

On its face, this suggestion is rather remarkable: that sufficiently sophisticated computer algorithms could substitute for a fair-use analysis by a human being. But then the court continued: “Copyright holders could then employ individuals . . . to review the minimal remaining content a computer program does not cull.” By falling back on the need for human review of content culled by those algorithms, the 9th Circuit seems to have reinforced the notion that the fair-use analysis will always require some amount of individual review.

Implications of the Decision

This most recent decision in the Lenz saga provides some guidance to copyright owners who send takedown notices. First, copyright owners should have written procedures for determining whether to include a particular video in a takedown notice, and those procedures should expressly require a consideration of fair use. Second, the employees responsible for determining what material is infringing should receive information and training about fair use. Third, to the extent possible, the employees making these determinations should document that they did, in fact, consider fair use before issuing a takedown notice. Not only will adhering to these guidelines decrease the likelihood of liability for an improper takedown notice, but it also will decrease the likelihood of facing potentially lengthy and expensive litigation in the first place.

As for those who have their material wrongfully removed from the Internet in response to a takedown notice, unless they have evidence that the copyright owner subjectively believed that the takedown notice was improper, the most effective remedy will likely be to prepare and submit a counternotification to have the material restored and not to file a lawsuit (importantly, however, once a service provider receives a counternotification, the only way for a copyright owner to stop the allegedly infringing material from being restored is to bring a lawsuit against the user).

While the 9th Circuit’s decision is notable for what it held, it is also notable for what it did not hold: It did not actually decide whether Stephanie Lenz’s YouTube posting was fair use in the first place, nor did it decide whether Universal misrepresented that the video was not authorized by the law in its takedown notice. The case will be sent back to the district court for those determinations and will likely find itself back in the 9th Circuit in another few years.1 At this rate, the case may be heard by the Supreme Court just as the dancing baby is headed to college.

 

This Article was published in the Intellectual Property & Technology Journal, Vol. 27, No. 12 (December 2015).

 

FOOTNOTE
1 On October 20, 2015, both sides filed petitions for rehearing with the Ninth Circuit, hoping to obtain a more decisive victory. As of this publication, the court had yet to rule on the petitions.”

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Holy Copyrightability Batman! The Batmobile Is Still a Superhero http://www.medialawmonitor.com/2016/01/holy-copyrightability-batman-the-batmobile-is-still-a-superhero/ Sun, 03 Jan 2016 19:15:09 +0000 http://www.medialawmonitor.com/?p=3068 By Karen A. Henry

A recent Ninth Circuit decision has endorsed copyright protection for Batman’s four-wheeled sidekick, confirming that copyright protection can extend to “sufficiently distinctive” elements of an original work, like comic-book characters, even if the “character” is a car.

The decision affirms DC Comics v. Towle, 989 F. Supp. 2d 948 (C.D. Cal. Feb. 7, 2013), which the author reported on in 2013.  In that decision, Judge Ronald Lew determined that the Batmobile is a comic-book character entitled to full copyright protection.1

While the 9th Circuit recognized the copyright in the Batmobile, it also  cautioned that “[n]ot every comic book, television or motion picture character is entitled to copyright protection.” Distilling wisdom from relevant cases,2 the 9th Circuit established a three-part test “for determining whether a character in a comic book, television program, or motion picture is entitled to copyright protection”:

  1. “the character must generally have physical as well as conceptual qualities”;
  2. “the character must be sufficiently delineated to be recognizable as the same character whenever it appears”; and
  3. “the character must be especially distinctive and contain some unique elements of expression.”

Applying this analytical framework to Gotham City’s mobile crime-fighter, the 9th Circuit concluded that “the Batmobile is a character that qualifies for copyright protection.” First, the court held that the Batmobile has physical and conceptual qualities because it “has appeared graphically in comic books, and as a three-dimensional car in television series and motion pictures[.]” As such, the Batmobile is “not a mere literary character.” Second, the court determined the Batmobile “is sufficiently delineated to be recognizable as the same character whenever it appears.” The court noted Judge Lew’s findings that the Batmobile has maintained distinct physical qualities. Indeed, since its initial appearance in comic books in 1941, the Batmobile has been a “highly-interactive vehicle, equipped with high-tech gadgets and weaponry used to aid Batman in fighting crime”; almost always has a “bat-themed front end, bat wings extending from the top or back of the car, exaggerated fenders, a curved windshield, and bat emblems”; is a “crime-fighting car with sleek and powerful characteristics that allow Batman to maneuver quickly while he fights villains”; and “always contains the most up-to-date weaponry and technology.” Third, the court observed that the Batmobile is “especially distinctive,” in that it consistently is referred to as “the Batmobile” and consistently is portrayed as “Batman’s loyal bat-themed sidekick[.]”

In solidifying the Batmobile’s status as a copyrightable character, the 9th Circuit rejected Towle’s contention that the distinctive car could not qualify for copyright protection because it has not maintained a consistent appearance throughout the years. The court noted that “a consistent appearance is not as significant in our analysis as consistent character traits and attributes,” equating the “changes” in the cars appearance to mere “costume changes that do not alter the Batmobile’s innate characteristics.” The 9th Circuit also rebuffed Towle’s argument that a jury should decide whether the car’s attributes are sufficiently distinctive for copyright protection, explaining the court is “well-equipped to determine whether, as a matter of law, the[] undisputed facts establish that the Batmobile is an especially distinctive character entitled to copyright protection.”

As this author noted in 2013, although Towle produced replica cars, not entertainment content, this case should be of interest to production companies that create their own versions of well-known elements from other films and television programs and incorporate them into new works. The 9th Circuit’s decision suggests that even functional elements sometimes may be treated as “characters” for purposes of copyright law.3

 

FOOTNOTES

1 Defendant Mark Towle owns “Gotham Garage,” where he produces replicas of automobiles featured in motion pictures and television program. DC Comics sued Towle for copyright infringement, among other claims, arising out of Towle’s production of replicas of the Batmobile as it appeared in the 1966 “Batman” television series starring Adam West and in the 1989 “Batman” motion picture starring Michael Keaton.
2 See Halicki Films, LLC v. Sanderson Sales & Mktg.547 F.3d 1213 (9th Cir. 2008) (“Eleanor” – car appearing in original and remake of “Gone in 60 Seconds” – could be entitled to copyright protection), Walt Disney Prods. v. Air Pirates, 581 F.2d 751 (9th Cir. 1978) (certain Disney characters entitled to copyright protection), Warner Bros. Pictures, Inc. v. Columbia Broad. Sys., Inc., 216 F.2d 945 (9th Cir. 1954), Metro-Goldwyn-Mayer, Inc. v. Am. Honda Motor Co., 900 F. Supp. 1287 (C.D. Cal. 1995) (James Bond copyrightable character), Toho Co. v. William Morrow & Co., 33 F. Supp. 2d 1206 (C.D. Cal. 1998) (Godzilla copyrightable character), and Sapon v. DC Comics, 2002 U.S. Dist. LEXIS 56395 (S.D.N.Y. Mar. 29, 2002) (Batman copyrightable character).
3 The 9th Circuit also addressed other aspects of Judge Lew’s opinion that are not covered here. This article only discussed the 9th Circuit’s decision to the extent it addresses the issue of whether the Batmobile qualifies as a character for purposes of copyright law.

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California’s Correction Statute Amended to Protect Online and Weekly Publications http://www.medialawmonitor.com/2015/12/californias-correction-statute-amended-to-protect-online-and-weekly-publications/ Mon, 21 Dec 2015 19:20:18 +0000 http://www.medialawmonitor.com/?p=3070 By Karen A. Henry

The California Legislature recently amended Civil Code § 48a to make clear that California’s correction statute applies to weekly and online publications performing the same news-disseminating function as a daily newspaper, settling decades of uncertainty about the scope of the statute’s reach.

Effective Jan. 1, 2016, the word “newspaper” in the statute’s current iteration is replaced with the phrase “daily or weekly news publication,” and that phrase is defined as “a publication, either in print or electronic form, that contains news on matters of public concern and that publishes at least once a week.” Moreover, the statute includes express legislative findings, declaring that earlier appellate rulings failed to acknowledge that the policy underlying the correction statute — protecting enterprises engaged in the immediate dissemination of news on matters of public interest — “should extend to online publications and weekly publications, which publish breaking news on deadlines indistinguishable from daily newspapers.”

The amendments to Section 48a represent a legislative recognition of the gap in protection caused by technological developments in news-delivery platforms and an acknowledgement that Californians are just as likely to get their news from the Internet as they are from print newspapers, radio or television. As amended, Section 48a will keep pace with revisions to California’s shield law (which long has been interpreted to apply to online publications) and ensure that news providers can rely on the correction statute’s valuable limitation on damages, whether published on paper or online.1

California’s correction statute is codified in Civil Code § 48a. In its current iteration, Section 48a reads, in pertinent part:

In any action for damages for the publication of a libel in a newspaper, or of a slander by radio broadcast, plaintiff shall recover no more than special damages unless a correction be demanded and be not published or broadcast, as hereinafter provided.

Under the statute, a plaintiff who sues a “newspaper” for libel can recover only special damages,2 unless the plaintiff timely demands and is denied a correction that complies with the statutory requirements. In other words, a plaintiff may obtain general damages (and where appropriate, punitive damages) for defamatory statements published in a “newspaper” only where the plaintiff demands a correction and the defendant neglects or refuses to publish one. In this way, the correction statute affords “newspapers” considerable leeway to disseminate news while it is new, without the threat of debilitating liability for publication of untrue statements, whose falsity could not be ascertained in the temporal confines allotted to purveyors of “breaking” news.

Because Section 48a does not define the term “newspaper,” courts have struggled to determine which news publications qualify for the correction statute’s protection. Two cases have been particularly instructive in defining the scope of Section 48a: Burnett v. National Enquirer, Inc.3 and Condit v. National Enquirer, Inc.4 In Burnett, comedian Carol Burnett brought a libel claim against the Enquirer, arising from a four-sentence report in the weekly publication, purportedly recounting her “boisterous” and “eye-brow-raising” behavior at a restaurant, where she supposedly engaged in a loud argument with Henry Kissinger. Burnett demanded a retraction the same day the article was published, but filed suit because she was not satisfied with the quality of the retraction that the Enquirer published. After a jury trial, Burnett was awarded $300,000 in compensatory damages and $1.3 million in punitive damages, which the trial court reduced to $50,000 in compensatory damages and $750,000 in punitive damages.

The Enquirer appealed, arguing it was entitled to the protection of the correction statute. The appellate court affirmed the judgment, explaining that only those publications “who engage in the immediate dissemination of news” are entitled to the correction statute’s limitation on damages. The court reasoned that “the Legislature could reasonably conclude that such enterprises cannot always check their sources for accuracy and their stories for inadvertent publication errors.”

With respect to the Enquirer, the evidence adduced at trial showed that the publication: (1) did not subscribe to the Associated Press, United Press International or Reuters News Service; (2) did not attribute content it published to any wire service; (3) did not provide current coverage of politics, sports or crime; (4) did not generally reference time in its articles; (5) did not generate stories on a day-to-day basis; and (6) had a lead time of one to three weeks. Under those circumstances, the Burnett court found that the trial court had correctly determined the Enquirer was not entitled to the correction statute’s protection because its publication process permitted sufficient time to verify the accuracy of the stories it published.

Nearly 20 years later, in Condit, the Enquirer again sought refuge under Section 48a. There, the wife of a former senator brought a defamation action against the Enquirer for an article implying she may have played a role in the disappearance of her husband’s former intern. The district court concluded that, “[w]hile the evidence show[ed] the 2001 Enquirer includes more crime stories than the 1976 Enquirer and that the 2001 Enquirer’s coverage of politics, sports and crime is more current and its lead time is shorter than the 1976 Enquirer, [t]he record d[id] not evidence the Enquirer is under pressure to disseminate news while it is news.” The evidence did not show that the 2001 Enquirer published news under circumstances where it could not confirm the accuracy and reliability of its information and sources. For that reason, it could not rely on Section 48a to limit the damages to which the plaintiff was entitled.

The fact that the 2001 Enquirer maintained a website did not change this result. The Condit court opined that, “[e]xistence of a website does not necessarily increase the pressure for more rapid dissemination without information and source investigation or accuracy confirmation.” Prophetically, notwithstanding its determination that the Enquirer did not qualify for Section 48a’s protection, the court noted that “[w]eekly publications that strive to disseminate ‘news while it is new’ … may qualify for protection under section 48a despite [their] weekly cycle.”

Fortunately, the legislature’s amendment to Section 48a removes any doubt and ensures that California’s powerful correction statute is now available to online and weekly publications that perform the same news-disseminating function as daily newspapers.

FOOTNOTES
1 The amendment to Section 48a responded to a challenge issued by a California Court of Appeal in Thieriot v. The Wrapnews Inc., 2014 Cal. App. Unpub. LEXIS 2690 (Cal. Ct. App. April 15, 2014). There, the appellate court held that California’s correction statute did not apply to allegedly defamatory statements published on a website. The court explained that, “[b]y its plain language, [the correction statute] applies only when the defamatory material is published in a ‘newspaper’ or a ‘radio broadcast.’” Id. at *38. “At the time the statute was enacted in 1931, or amended in 1945, a ‘newspaper’ was understood to mean a publication that was printed on inexpensive paper, often daily.” Id. “Had the Legislature intended the statute to apply to defamatory material published on an online website,” the court reasoned, “it could have amended the statute to say so, or add[ed] a statute to include such websites within the definition of ‘newspaper[.]’” Id. at *39.
2 “Special damages” are defined as “all damages which plaintiff alleges and proves that he has suffered in respect to his property, business, trade, profession or occupation, including such amounts of money as the plaintiff alleges and proves he has expended as a result of the alleged libel, and no other[.]” Cal. Civ. Code § 48a(4)(b).
3 144 Cal. App. 3d 991 (1983).
4 248 F. Supp. 2d 945 (E.D. Cal. 2002).

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Another Page in the Google Books Saga: Appeals Court Blesses Mass Digitization Project as Fair Use http://www.medialawmonitor.com/2015/11/another-page-in-the-google-books-saga-appeals-court-blesses-mass-digitization-project-as-fair-use/ Sat, 21 Nov 2015 19:20:38 +0000 http://www.medialawmonitor.com/?p=3072 By Lance Koonce

Those of us of a certain age (read: old) still recall standing in line at the bank of copy machines in the school library, quarters in hand, waiting to copy a few pages of a key piece of research found in the stacks. Those noisy machines have now largely been replaced by coffee shops and smartphone recharging stations … as have, in many cases, the library stacks themselves.

Perhaps fittingly, when Google decided in the early 2000s to digitize the world’s books, it began by partnering with large libraries to copy portions of their collections, including many that are now out of print. The libraries themselves generally held no copyright interest in the books they provided to Google. Rather, they held unique, expansive physical collections of books that made them a good fit for Google’s project. Partnering with libraries (rather than, for instance, buying books from bookstores) was also clever on Google’s part: It put the company in league with academic and research institutions, which are more often on the fair-use side of the copyright-infringement equation.

In 2005, several authors brought a putative class action against Google, claiming that their books’ reproduction as part of the Google Library Project infringed upon their copyright interest. In 2013, the Southern District of New York rejected those claims, finding the project a fair use.

The 2nd U.S. Circuit Court of Appeals has now affirmed the lower court’s decision, stating in its opening sentence that the case “tests the boundaries of fair use,” which is no doubt true: Google’s digitization of millions of copyrighted works, all under the fair-use defense, is unprecedented. Judge Pierre N. Leval’s relies on the large body of fair-use jurisprudence on “transformativeness” developed over the past several decades, which he in large part originated with his seminal “Toward a Fair Use Standard” article in 1990. His decision is characteristically filled with bite-sized nuggets of fair-use wisdom that will no doubt be cited in many future briefs and decisions. Still, while Judge Leval is careful to provide caveats that limit the court’s decision to the specific uses (and protections) encompassed by Google’s particular project, with this decision the 2nd Circuit has to some degree opened another door allowing further monetization by third parties around existing, copyright-protected works.

Indeed, the plaintiffs believe that the Second Circuit has opened the door more than a crack – they are now seeking review by the U.S. Supreme Court, arguing that Judge Leval’s decision has essentially “nullified” the four-factor test for fair use set forth in the Copyright Act, substituting a new analysis which recognizes that “verbatim copying and display, involving no new expression, is immunized as “transformative” if it provides sufficient social benefits of a different sort—like helping people find books or information.

The Google Library Project

Once books are scanned by Google, the resulting digitized contents are deployed in the following manner. First, the Google Books search function allows users to search for words and phrases within the database, which returns a list of books containing those terms. The search results also include a brief description of the book, as well as a short “snippet” – usually about one-eighth of a page – of the text surrounding the term(s) for which the user was searching. Google has also partnered with many publishers and authors to make available larger portions of certain books and to provide links for purchasing the books online. Books no longer under copyright (that is, in the public domain) may be displayed in full.

Crucially, Google also places strict limits on the manner in which search results are provided. First, Google Books will only show at most three snippets from any book in response to a search. Second, Google “black lists” one page in every 10 from each book, and one snippet per page. It also does not allow the viewing of any snippets for certain works where seeing a snippet might provide too much key content, such as cookbooks (this restriction appears to reflect the fair-use concern, under the third factor, of taking the “heart” of a work). Third, Google excludes books from snippet view upon the copyright holder’s request.

In addition, in providing the Google Books search function, Google also provides a digital copy of each book it digitizes to the original library or other institution that provided the physical copy for scanning. Its contracts with those institutions generally require the institution to follow copyright law in using the digital copies and to not freely allow dissemination to the public.

The Decision

Background on Fair Use

Beginning with first principles, Judge Leval’s decision cites the constitutional and theoretical underpinnings of copyright law, noting that “the ultimate, primary intended beneficiary” of copyright protection is “the public, whose access to knowledge” is served by providing “rewards for authorship” to individual authors who bring their works to the public. The decision then notes that sometimes this interest in expanding public knowledge conflicts with the monopoly given to authors and that the fair-use doctrine has arisen to address this conflict.

Judge Leval is careful to note that the fair-use “test” is not a rigid one, and rather that each of the four fair-use factors found in Section 107 of the Copyright Act “stands as part of a multifaceted assessment of the crucial question: how to define the boundary limit of the original author’s exclusive rights in order to best serve the overall objectives of the copyright law to expand public learning while protecting the incentives of authors to create for the public good.”

In his analysis, Judge Leval concentrates primarily on the first factor (purpose and character of the use) and the fourth factor (effect on the potential market for the copyrighted work), as most courts now do. Notably, he summarizes the law on transformativeness under the first factor in a clear, succinct way and ties it back to the underlying purpose of copyright law, stating that “transformative uses tend to favor a fair use finding because a transformative use is one that communicates something new and different from the original or expands its utility, thus serving copyright’s overall objective of contributing to public knowledge.” He also cautions against relying too heavily on the word “transformative” itself, as it is merely “a suggestive symbol for a complex thought,” and distinguishes transformation of purpose under the first factor from the concept of transforming a work’s form in defining derivative works, an overlap that has confounded litigants and judges in other cases.

Fair-Use Analysis

Getting down to business, Judge Leval then examines the search functionality of the Google project under each factor, readily finding that the search functionality itself serves a “highly transformative” purpose. That purpose is allowing searchers to identify and locate “significant information about those books” themselves (emphasis in original). In other words, Judge Leval blesses the provision of what is essentially metadata about the copyrighted works – the inclusion of certain terms, the frequency those terms are used – as well as data about all of the collected works as a whole, such as the use of specific words during historical periods. Elsewhere in the decision, he also notes that for the most part, copyright owners simply hold no interest in the type of information being provided by Google.

More troublesome for the court is the question of the snippets, where clearly some portion of protected expression, not just metadata, is being provided to searchers. Here, Judge Leval holds that the provision of this contextual information is critical and “adds important value” to the transformative purpose of the search tool. As such, the first factor favors Google.

After finding that the second fair-use factor (nature of the copyrighted work) played no role in this case, Judge Leval turns to an analysis of the amount and substantiality of the portion used, finding that the taking of the entirety of a work is justified where it is “literally necessary to achieve” the transformative purpose, such as for Google’s basic search functionality. Judge Leval’s approach mirrors that of other modern cases on digital copyright such as Perfect 10, Inc. v. Amazon.com, Inc. and Kelly v. Arriba Soft Corp., where any prior conceptual arguments against copying of works in their entirety have fallen in the face of technological uses that require access to the whole work in order to function.

With respect to the provision of snippets, Judge Leval acknowledges that depending on how such content was provided, such a use might not pass muster under the third factor. He therefore rests his conclusions on the specifics of the Google project and the limitations imposed by it (described above). “The result of these restrictions is, so far as the record demonstrates, that a searcher cannot succeed, even after long extended effort to multiply what can be revealed, in revealing through a snippet search what could usefully serve as a competing substitute for the original.” Based on the evidence before the court, no more than 16 percent of the original content could be provided through snippets, and this would require an extraordinary effort on the part of the user; moreover, the 16 percent would consist of “fragmentary and scattered” snippets that could not be considered “substantial” under the third factor.

Completing his fair-use analysis, Judge Leval finds that the fourth factor favors fair use because the ability to search the text of the book to determine whether it includes selected words does not act as a substitute for the books themselves, but he does note that “[e]ven if the purpose of the copying is for a valuably transformative purpose, such copying might nonetheless harm the value of the copyrighted original if done in a manner that results in widespread revelation of sufficiently significant portions of the original as to make available a significantly competing substitute.” In the case of the Google snippets – again as currently offered – he concludes that while this function might possibly cause the loss of some sales, as a whole there would not be significant effect on the potential market for the copyrighted work.

Derivative Argument

In addition to the fair-use analysis, Judge Leval makes quick work of the plaintiffs’ argument that they have a derivate copyright interest in providing search and snippet functions as to their own works. He holds that “[t]he copyright resulting from the Plaintiffs’ authorship of their works does not include an exclusive right to furnish the kind of information about the works that Google’s programs provide to the public. For substantially the same reasons, the copyright that protects Plaintiffs’ works does not include an exclusive derivative right to supply such information through query of a digitized copy.” In other words, the right to create derivative works does not extend to “right to supply information about that work of the sort communicated by Google’s search functions.”

Exposure-to-Piracy Argument

Judge Leval expresses sympathy for the plaintiffs’ remaining argument, that the storage by Google (presumably forever) of digitized copies of plaintiffs’ books risks exposure to hackers and pirates. However, ultimately he finds that the concern is simply not supported by the evidence in the record, which instead supported Google’s argument that the digital files were secure.

Distribution to Libraries

With respect to plaintiffs’ claim that Google violates their copyright by distributing digital copies to the libraries that provide physical copies for scanning, Judge Leval describes Google’s activity as the “creation for each library of a digital copy of that library’s already owned book in order to permit that library to make fair use through provision of digital searches,” and he then finds this use to be non-infringing. In other words, Judge Leval posits Google as a service provider that merely digitizes works for institutions that want to make fair use of those works. The plaintiffs, to the contrary, argued that Google could not convert potential fair uses by the institutions into fair use by Google, which created the digital copies for its own commercial purposes. Rather than addressing this point specifically, the court’s decision merely brushes aside the possibility that the libraries might use the digital copies to infringe as speculative.

Slippery Slope?

One of the plaintiffs’ most compelling arguments, albeit one that was difficult to make to an appellate court reviewing a fair-use decision on a specific evidentiary record, was that a ruling in favor of Google would open the floodgates for other parties to engage in mass digitization without putting in place all of the controls Google employs.

In particular, we are likely to see a similar push to expand the definition of “snippet,” especially as search is applied to other elements besides mere text. What portions of a video, for instance, might be returned as a search result without infringing, and how much video before and after that portion could be considered necessary for context?

As always, those who seek to use copyrighted works for new and different purposes without permission will need to consider carefully whether they are using only the portions of the underlying works necessary to serve those purposes, and copyright holders will need to carefully consider which uses by third parties truly impact the market for the original work.

Of course, they will also need to keep an eye on whether the Supreme Court decides to open a new chapter in this saga by granting certiorari to the plaintiffs.

 

A version of this article was published in the Intellectual Property & Technology Journal, Vol. 28, No. 2 (February 2016).

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FTC OKs Facial Recognition Consent Under COPPA Rule http://www.medialawmonitor.com/2015/11/ftc-oks-facial-recognition-consent-under-coppa-rule/ Fri, 20 Nov 2015 19:21:49 +0000 http://www.medialawmonitor.com/?p=3074 By Ronald G. London and Bryan Thompson

This past Nov. 18, the Federal Trade Commission (FTC) approved a new verifiable parental-consent method under the Children’s Online Privacy Protection Act (COPPA) Rule, which will allow entities to use facial-recognition technology to obtain the parental consent required under the COPPA Rule prior to collecting, using or disclosing information on children younger than 13 years old.

Back in July, Riyo Inc. applied for FTC approval of its proposed “face match to verified photo identification” (FMVPI) method, a two-step facial-recognition process that compares an image of a parent’s photo identification (for example, a driver’s license or passport) taken with the parent’s phone or device camera with a selfie that is later provided for verifiable parental consent. The technology used is in turn designed to detect facial movements to ensure that the selfie is of a live person and not a photo of a still image. Both images are then analyzed by the FMVPI system as well as live agents for verification.

Under the FTC’s COPPA Rule, websites and online services that collect personal information online from children younger than 13 must obtain verifiable parental consent authorizing the collection, use and/or disclosure of a minor’s information. The rule specifies several methods of gaining verifiable parental consent and allows parties to submit and seek FTC approval of additional means for obtaining consent not currently permitted by the rule.

In its letter approving Riyo’s application, the FTC found that facial-recognition technology is currently used in a number of industries to verify an individual’s identity and that the technology’s sophistication has grown rapidly in recent years. Riyo’s FMVPI method is also more rigorous than the government-issued identification method of verifiable consent already approved under the COPPA Rule because, according to the FTC, FMVPI verifies that “the individual to whom the identification was issued is the same individual who is interacting with the system at that moment.” Consequently, the FTC held that Riyo’s FMVPI method is in line with the COPPA Rule and is “reasonably calculated, in light available technology, to ensure that the person providing consent is the child’s parent.”

Businesses and other entities that need to obtain COPPA-required verifiable parental consent prior to collecting, using or disclosing children’s information will likely benefit from the FTC’s approval of Riyo’s facial-recognition method, as it will allow parents to quickly provide their consent via a smartphone, tablet or other photo-enabled device that is typically within a parent’s reach. And because the FTC “does not approve one party’s specific implementation of a [consent] method or a proprietary system under the … Rule,” the FTC’s decision will also likely allow other companies to gain approval for other verifiable parental-consent methods that rely on facial-recognition systems distinct from Riyo’s FMVPI method.

A company that is interested in using facial-recognition technology in its verifiable parental-consent program should consult with counsel before employing any new mechanisms to ensure that all of its consent burdens under COPPA are met.

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California Beefs Up Encryption & Notice in Data Breach Law http://www.medialawmonitor.com/2015/10/california-beefs-up-encryption-notice-in-data-breach-law/ Tue, 27 Oct 2015 19:23:39 +0000 http://www.medialawmonitor.com/?p=3077 By Christopher Avery and Bryan Thompson

On October 8, 2015, California Governor Jerry Brown signed A.B. 964 and S.B. 570 into law, a pair of bills that amended the Golden State’s data breach notification statute (Ca. Civ. Code § 1798.82). The amendments, which went into effect on January 1, 2016, specifically define “encrypted” information so as to presumptively exclude it from notice and disclosure requirements, add additional notice format requirements for printed and emailed consumer breach notifications, and specify additional notice method requirements when consumers’ usernames or email addresses are specifically affected. Both bills also add information collected by automated license plate recognition systems to the statute’s definition of personal information, and slightly alter the requirements for substitute notice.

While the definition of “encrypted” may help businesses determine just when consumer notification is required under California’s law, meeting the new format and method restrictions may make delivering any required notices all the more burdensome and expensive. Consequently, businesses that must comply with California’s breach notice statute should review and make any necessary changes to their notification procedures and practices, as well as any standard breach notification forms used to notify consumers about data security incidents.

What do the Amendments Require?

The major change brought by A.B. 964 is that it defines information as “encrypted” if it is “rendered unusable, unreadable, or indecipherable to an unauthorized person through a security technology or methodology generally accepted in the field of information security.”  Fortunately, this new definition is technology neutral and does not specify a particular encryption methodology.  A breach of encrypted information is presumed to be outside of the statute’s data breach notification requirements, but the presumption is rebuttable, specifically so if the encryption code or method is also compromised.  While California’s breach notification statute has had an encryption safe harbor since its inception, the meaning of “encrypted” was not previously specified. A.B. 964 should give companies that do business in California a bit of comfort by more precisely describing just what encryption practices will fall under the safe harbor.

S.B. 570 makes the most significant changes for businesses that have to give notice to California residents, and requires that the mandated content in a printed or emailed consumer notification be formatted and organized in a particular manner. Businesses still have to provide notice in plain language, but now must also title any document or email informing consumers of a breach as “Notice of Data Breach,” use at least 10-point font, and organize the content required by statute under the following “clearly and conspicuously displayed” headlines:

  • “What Happened”;
  • “What Information Was Involved”;
  • “What We Are Doing”; and
  • “What You Can Do.”

Other important information may be provided as a supplement. S.B. 570 further includes a breach notification template that will be automatically deemed in compliance with the new format requirements, serving as a safe harbor for businesses when providing notice.

According to the bill’s legislative history, the new format structure is designed to draw the reader’s attention to the nature and significance of the information in any notice they receive. But with more demands for specificity comes more complexity – and possibly more expense – for businesses when giving notice to consumers in multiple states. For instance, a typical breach often affects consumers in multiple states, but the type of notice demanded by California’s new law likely could not be used to inform consumers in Massachusetts, as that state’s notification statute expressly prohibits a company from informing consumers about the nature of a breach. Consequently, businesses will have to develop several different notice formats and implement methods to ensure that the right format of notice is sent to consumers in the right jurisdictions, potentially increasing the cost and time that it takes to inform consumers.

Both A.B. 964 and S.B. 570 include additional notice requirements when a consumer’s username or email address are the only personal information affected. Businesses and other entities may notify consumers of a breach via “electronic or other form” that affects only a consumer’s username or email address associated with an online account, along with the account’s password or security question and answer, by directing the consumer to:

  • Promptly change the password and security question or answer associated with the account; or
  • Take other appropriate steps to protect the affected online account, as well as other others for which the same username or email address might be used.

However, an entity may not use this same method when the login credentials of an email address provided by the entity itself are affected. Instead, it must provide notice via another method described under the statute or by “clear and conspicuous notice” delivered when the consumer is connected to the affected online account from a customary IP address or online location.

Finally, both bills amend the statute’s substitute notice provision by mandating that conspicuous posting of the notice on a business’s website must remain up for at least 30 days. Additionally, a link to the notice must be on the website’s homepage or first significant page and be in either a larger type than the surrounding text, in a contrasting type or font, or set off by marks calling attention to the link. Both bills also alter the definition of “personal information” to include information or data collected by an automated license plate recognition system, as defined in S.B. 34, a companion bill approved by Governor Brown on October 6, 2015.

Next Step for Businesses: Change Notification Policies, Procedures, and Forms

Businesses and all other entities that are subject to Ca. Civ. Code § 1798.82 should welcome the more precise definition that A.B. 964 gives to “encrypted” information as this gives them a better ability to assess when their method of encrypting consumers’ personal information falls under California’s encryption safe harbor. However, the additional formatting requirements and restrictions surrounding notice when only consumers’ usernames and email addresses are breached may prove to be little more than a new procedural hurdle that businesses have to clear, adding more complication to the already complex process of informing consumers across multiple states when a data breach might concern their information. Regardless, all entities should inspect their current data breach notice policies and procedures, along with any breach notification forms, to ensure that their processes and methods for alerting consumers about discovered breaches are in line with California’s newest notice requirements. Companies should also examine whether the model breach notification template now listed in the statute would meet their respective consumer notice responsibilities in the event of a breach.

Please refer to Davis Wright Tremaine’s Summary of State Data Breach Notification Statutes and interactive heat map for current information on the data breach notification requirements in California and the other states and territories.

 

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The 2015 Amendments to the Federal Rules of Civil Procedure: Changing the Way Civil Litigants Operate in Federal Court http://www.medialawmonitor.com/2015/10/the-2015-amendments-to-the-federal-rules-of-civil-procedure-changing-the-way-civil-litigants-operate-in-federal-court/ Mon, 26 Oct 2015 19:31:57 +0000 http://www.medialawmonitor.com/?p=3125 By Karen A. Henry and Diana Palacios

The recent amendments to the Federal Rules of Civil Procedure are the most significant overhaul of the rules governing civil litigation in federal court that we’ve seen in decades, including dramatic changes to the timing and procedure surrounding case management and a veritable sea change in the scope of discovery.

This article briefly recounts the history surrounding these changes and includes a chart with an at-a-glance summary of these amendments, which amend Rules 1, 4, 16, 30, 31, 33, 34, 37, and 55 and abrogate Rule 84 and the Appendix of Forms. Then, following the chart, some of the most notable amendments in the package are redlined and discussed more fully.

I. HISTORY OF THE 2015 AMENDMENTS TO THE FRCP

The FRCP was enacted to achieve a singular, overarching objective – a just, speedy, and inexpensive resolution to every civil action in federal courts.  Despite this lofty goal, years of complaints about the costs, delays and burdens of civil litigation in federal court prompted the Committee to step back and take a sobering look at the efficacy of the FRCP.

Toward that aim, the Committee held a Civil Litigation Conference (the “Conference”) at Duke University School of Law in the Spring of 2010.  In preparation for the Conference, the Committee commissioned, assembled and reviewed a mountain of empirical data assessing the federal civil justice system.  Then, on May 10, 2010, hundreds of attorneys representing a variety of practice areas converged on Durham, North Carolina for the Conference.  Over the course of two days, more than 70 panelists comprising judges, lawyers and academics presented the empirical data and engaged the audience in lively discussions about various ways to remedy the scourge of cost and delay attendant to litigating civil cases in federal court.

Out of the discussions at the Conference, a framework for possible amendments to the FRCP was conceived.  And over the next five years, this framework endured several cycles of comment, revision and refinement, which has culminated in the 2015 Amendments to the FRCP – the most robust and significant changes to the federal civil rules in decades.  These amendments are intended to redress three key themes highlighted during the Conference: (1) the need for better case management; (2) more effective use of the long-ignored principle of “proportionality”; and (3) an increased emphasis on the role of cooperation among the parties in discovery.  The amendments are expected to reduce the cost and delay that has plagued civil litigation in federal court in recent years (largely due to the recent revolution in information technology), and to reposition the FRCP to achieve the goal of helping civil litigants in federal court to obtain just, speedy and inexpensive resolutions to their actions.

RULE NO.

SUMMARY OF AMENDMENTS

1

The rule now makes clear that the Federal Rules of Civil Procedure should be construed, administered, and employed by both the court and the parties to secure a just, speedy, and inexpensive determination of every action.

4

The time to serve a defendant is reduced from 120 days to 90 days.

16

The rule no longer provides for scheduling conferences by “telephone, mail, or other means” and the time for a court to issue a scheduling order is now the earlier of 90 days after any defendant has been served, or 60 days after any defendant has appeared.  The rule was also amended to permit scheduling orders to address the preservation of electronically stored information (“ESI”) and incorporate the parties’ agreements for asserting claims of privilege and work-product protection.

26

This rule now mandates that discovery be relevant to any party’s claim or defense and proportional to the needs of the case.  The rule also has been amended to permit requests for production to be sent before the Rule 26(f) conference.

30-33

These rules are amended to take into account the proportionality requirement of Rule 26.

34

The rule has been amended to require objections “with specificity,” require responses to state whether documents are being withheld, and provide a reasonable time for production.

37

The amendment to this rule is directed to the preservation and loss of ESI by outlining considerations of whether information should have been preserved, and specifying measures a court may employ if information that should have been preserved is lost and cannot be restored or replaced.

55

The change to Rule 55 is meant to clarify that a default judgment that does not dispose of all of the claims among all parties is not a final judgment, unless so directed by the court, and thus may be revised by the court until final judgment is entered.

84

This rule and forms were adopted to illustrate the simplicity and brevity that the Rules contemplate.  According to the Advisory Committee, this purpose has been fulfilled and therefore, the rule and forms no longer are required, but their abrogation does not alter existing pleading standards.

 

II. DISCUSSION OF AMENDMENTS TO RULES 4, 16, 26, 34, AND 37.

Below is a more detailed explanation of the impending amendments to Rules 4, 16, 26, 34, and 37.


A. RULE 4: TIME LIMIT FOR SERVICE
.

Redline of Changes to Rule 4(m):

If a defendant is not served within 120 90 days after the complaint is filed, the court – on motion or on its own after notice to the plaintiff – must dismiss the action without prejudice against that defendant or order that service be made within a specified time.  But if the plaintiff shows good cause for the failure, the court must extend the time for service for an appropriate period.  This subdivision (m) does not apply to service in a foreign country under Rule 4(f) or 4(j)(1) or to service of a notice under Rule 71.1(d)(3)(A).

The amendments to Rule 4(m) were born out of the perception that the initial stages of civil litigation simply take too long.  The general consensus of the Committee was that it should not take four months to serve a summons and complaint.  While the Committee initially considered cutting the time limit for service in half, commenters on that proposed change offered a host of reasons why a 60-day period was not long enough (e.g., evasive defendants, the difficulty of identifying defendants through chains of interlocking or changing corporate relationships, the challenges of effecting service in multiple-defendant cases, and the fact that a 60-day period would effectively deprive plaintiffs of an opportunity to request a waiver of service).  As a result of the concerns reflected in the comments, the Committee decided to shorten the time limit for service from 120 days to 90 days.

Shortening the time limit for service produces two notable, collateral effects.  First, Rule 15(c)(1)(C) permits an amendment to a pleading to relate back to the date of the original pleading under certain circumstances.  Of particular relevance here, an amendment relates back when it changes the party or the naming of the party against whom a claim is asserted, the claim arises out of the conduct, transaction or occurrence set out in the original pleading, and if, within the period provide by Rule 4(m), the party to be brought in by amendment receives notice of the action such that it will not be prejudiced in defending on the merits and knew or should have known that the action would have been brought against it, but for a mistake concerning the proper party’s identity.  Thus, as explained in the Advisory Committee Notes, “[s]hortening the time to serve under Rule 4(m) means that the time of the notice required by Rule 15(c)(1)(C) for relation back is also shortened.”

Second, the shortened service period threatened to infringe the rights of property owners in condemnation proceedings.  As explained in a May 8, 2013 Report of the Advisory Committee on Civil Rules, “Rule 71.1(d)(3)(A) directs that service of notice of [condemnation] proceeding be made on defendant-owners ‘in accordance with Rule 4.’  This wholesale incorporation of Rule 4 may seem to include Rule 4(m).  Invoking Rule 4(m) to dismiss a condemnation proceeding for failure to effect service within the required time, however, is inconsistent with Rule 71.1(i)(C), which directs that if the plaintiff ‘has already taken title, a lesser interest, or possession of’ the property, the court must award compensation.  This provision protects the interests of owners, who would be disserved if the proceeding is dismissed without awarding compensation but leaving title in the plaintiff.”

To respond to concerns that shortening the time limit for service would negatively impact owners in condemnation proceedings, the Committee amended Rule 4(m) to make clear that Rule 4(m) does not apply to service of a notice of condemnation proceedings under Rule 71.1(d)(3)(A).


B. RULE 16: SCHEDULING.

 

Redline of Changes to Rule 16(b)(1)-(3):

(1)   Scheduling Order.  Except in categories of actions exempted by local rule, the district judge – or a magistrate judge when authorized by local rule – must issue a scheduling order:

(A) after receiving the parties’ report under Rule 26(f); or

(B)  after consulting with the parties’ attorneys and any unrepresented parties at a scheduling conference by telephone, mail, or other means.

(2)   Time to Issue.  The judge must issue the scheduling order as soon as practicable, but in any event unless the judge finds good cause for delay, the judge must issue it within the earlier of 120 90 days after any defendant has been served with the complaint or 90 60 days after any defendant has appeared.

(3)   Contents of the Order.

***

(B)  Permitted Contents.  The scheduling order may:

***

(iii)             provide for disclosure, or discovery or preservation of electronically stored information;

(iv)             include any agreements the parties reach for asserting claims of privilege or of protection as trial-preparation material after information is produced, including agreements reached under Federal Rule of Evidence 502;

(v)               direct that before moving for an order relating to discovery, the movant must request a conference with the court;

(vi)             set dates for pretrial conferences and for trial; and

(vii)           include other appropriate matters.

The amendments to the case management provisions of Rule 16(b) continue the Committee’s efforts to streamline the initial stages of civil litigation, and to encourage early judicial involvement.  These amendments impact the case management process in four important ways.

First, seizing on the notion that cases are resolved more quickly and with less expense when there is early, active judicial oversight, the Committee omitted the phrase “by telephone, mail, or other means” from Rule 16(b)(1)(B).  Instead, the Committee now mandates “direct simultaneous communication” between the litigants and courts during the Rule 16 schedule conference, which now must be held in person, by telephone, or by other “more sophisticated” electronic means.

Second, the time frame within which courts must issue scheduling orders has been reduced to the earlier of 90 days after any defendant has been served with the complaint or 60 days after any defendant has appeared in the litigation.  However, recognizing that “[l]itigation involving complex issues, multiple parties, and large organizations, public or private, may be more likely to need extra time to establish meaningful collaborations[,]” Rule 16(b)(1)(B) allows courts to delay the issuance of the order on a finding of good cause.

Third, noting the growing role of electronically stored information in civil litigation, the Committee is encouraging litigants to address issues surrounding ESI early.  Toward that aim, Rule 16(b)(3)(B) now permits courts (a) to incorporate in scheduling orders the parties’ agreements for asserting claims of privilege and work-product protection (including FRE 502 agreements), and (b) to provide in scheduling orders for the preservation of ESI.  These amendments were made to remind litigants that early consideration of these subjects can simplify the discovery process, especially use of FRE 502 agreements, a discovery tool the Committee found grossly underused.

Fourth, Rule 16(b)(3)(B) also has been amended to allow courts to require parties to request a conference before filing a discovery motion.  The Advisory Committee Notes acknowledge that “[m]any judges who hold such conferences find them an efficient way to resolve most discovery disputes without the delay and burdens attending a formal motion[.]”

C. RULE 26: PROPORTIONAL DISCOVERY, ALLOCATION OF COSTS, AND EARLY REQUESTS.

Redline of Changes to Rule 26(b)-(f):

(b) Discovery Scope and Limits.

(1)   Scope in General. Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties’ relative access to relevant information, the parties’ resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable. —including the existence, description, nature, custody, condition, and location of any documents or other tangible things and the identity and location of persons who know of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(C).

***

(2)   Limitations on Frequency and Extent.

***

(C) When Required. On motion or on its own, the court must limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that:

***

(iii)              the burden or expense of proposed discovery is outside the scope permitted by Rule 26(b)(1)outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issue

***

(c) Protective Orders.

(1)   In General. A party or any person from whom discovery is sought may move for a protective order in the court where the action is pending—or as an alternative on matters relating to a deposition, in the court for the district where the deposition will be taken. The motion must include a certification that the movant has in good faith conferred or attempted to confer with other affected parties in an effort to resolve the dispute without court action. The court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including one or more of the following:

            ***
(B)  specifying terms, including time and place or the allocation of expenses, for the disclosure or discovery;

            ***

(d) Timing and Sequence of Discovery.

***

(2)   Early Rule 34 Requests.

(A) Time to Deliver. More than 21 days after the summons and complaint are served on a party, a request under Rule 34 may be delivered:

(i)              to that party by any other party, and

(ii)            by that party to any plaintiff or to any other party that has been served.

(B)  When Considered Served. The request is considered to have been served at the first Rule 26(f) conference.

(3)   Sequence.  Unless, on motion, the parties stipulate or the court orders otherwise for the parties’ and witnesses’ convenience and in the interests of justice:

***

(f) Conference of the Parties; Planning for Discovery.

***

(3)   Discovery Plan. A discovery plan must state the parties’ views and proposals on:

***

(C)  any issues about disclosure, or discovery, or preservation of electronically stored information, including the form or forms in which it should be produced;

(D) any issues about claims of privilege or of protection as trial-preparation materials, including—if the parties agree on a procedure to assert these claims after production—whether to ask the court to include their agreement in an order under Federal Rule of Evidence 502;

The amendments to Rule 26 are intended to promote efficiency and prompt early discussion about discovery between the parties.

The most significant change to Rule 26 amends the scope of permissible discovery by requiring discovery to be proportional to the needs of the case and by deleting the oft-cited phrase, “[r]elevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.”  The proportionality factors added to Rule 26(b)(1) are not new.  Indeed, most factors were added in 1983 and all but one factor – the parties’ relative access to information – are currently found in Rule 26(b)(2)(C)(iii), albeit in a different order.  By relocating the factors, the amended Rule 26 now explicitly requires parties to consider proportionality when propounding discovery.  While proportionality is an important principle to be applied to all of discovery, the Advisory Committee Note explains that this change neither places the burden of addressing all proportionality considerations on the party seeking discovery nor permits the opposing party to refuse discovery by making boilerplate objections based on proportionality.

Rule 26 has also been amended to explicitly recognize a court’s authority to enter protective orders that allocate expenses for disclosure or discovery.  This explicit recognition is intended to forestall the temptation of some parties to contest the court’s authority in this regard; however, the Committee warns that this change does not imply that cost-shifting should become common practice, adding “[c]ourts and parties should continue to assume that a responding party ordinarily bears the costs of responding.”

Further, the moratorium on discovery before the Rule 26(f) conference has been relaxed to permit parties to propound Rule 34 requests earlier.  The requests, however, are not considered served until the first Rule 26(f) conference and under Rule 34(b)(2)(A), the time to respond runs from service.  This early delivery is meant to facilitate and focus discussion between the parties at the initial case management conference, which may produce changes in the requests.  The Advisory Committee Notes also make clear that early delivery of requests “should not affect a decision whether to allow additional time to respond.”

Finally, Rule 26(f)(3) was amended to be parallel with Rule 16(b)(3) as discussed above.

D. RULE 34: SPECIFIC OBJECTIONS AND TIME TO RESPOND.

Redline of Changes to Rule 34 (b)(2):

(b) Procedure.

***

(2)   Responses and Objections.

(A)  Time to Respond. The party to whom the request is directed must respond in writing within 30 days after being served or — if the request was delivered under Rule 26(d)(2) — within 30 days after the parties’ first Rule 26(f) conference. A shorter or longer time may be stipulated to under Rule 29 or be ordered by the court.

(B)   Responding to Each Item. For each item or category, the response must either state that inspection and related activities will be permitted as requested or state an objection with specificity the grounds for objecting to the request, including the reasons. The responding party may state that it will produce copies of documents or of electronically stored information instead of permitting inspection. The production must then be completed no later than the time for inspection specified in the request or another reasonable time specified in the response.

(C)   Objections. An objection must state whether any responsive materials are being withheld on the basis of that objection. An objection to part of a request must specify the part and permit inspection of the rest.

Rule 34 was amended to reduce potential unreasonable burdens and discovery disputes caused by the use of broad, boilerplate objections to requests, responses that do not state whether responsive documents are being withheld, and responses stating that responsive documents will be produced in due course.  To do so, the rule has adopted the language from Rule 33(b)(4), explicitly requiring objections to be stated with specificity. The Advisory Committee Note explains that this specificity requirement is tied to the new provision in Rule 34 directing that an objection must state whether any responsive materials are being withheld.  Thus, for example “[a]n objection may state that a request is overbroad, but if the objection recognizes that some part of the request is appropriate the objection should state the scope that is not overbroad,” such as stating that the responding party will limit the search to documents or ESI within a given time period. This change is meant to end the confusion that occurs when a party states several objections and still produces information.

To reflect common practice, the rule was also amended to permit a party to produce copies of documents or ESI instead of permitting inspection.  The amended rule, however, clarifies that the production must be completed “no later than the time for inspection specified in the request or another reasonable time specified in the response.”  According to the Committee, if the production must be made in stages, “the response should specify the beginning and end dates of the production.”

Further, as mentioned above, Rule 34 now permits requests for productions to be delivered before the Rule 26(f) conference.

E. RULE 37: FAILURE TO PRODUCE AND ESI.

Redline of Amended TextRule 37(a), (e):

(a) Motion for an Order Compelling Disclosure or Discovery.

***

(3)   Specific Motions.

      ***

(B)   To Compel a Discovery Response. A party seeking discovery may move for an order compelling an answer, designation, production, or inspection. This motion may be made if:

      ***

(iv)             a party fails to produce documents or fails to respond that inspection will be permitted—or fails to permit inspection—as requested under Rule 34.

***

(e)    Failure to Provide Preserve Electronically Stored Information. Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system. If electronically stored information that should have been preserved in the anticipation or conduct of litigation is lost because a party failed to take reasonable steps to preserve it, and it cannot be restored or replaced through additional discovery, the court:

(1)   upon finding prejudice to another party from loss of the information, may order measures no greater than necessary to cure the prejudice; or

(2)    only upon finding that the party acted with the intent to deprive another party of the information’s use in the litigation may:

(A)  presume that the lost information was unfavorable to the party;

(B)    instruct the jury that it may or must presume the information was unfavorable to the party; or

(C)   dismiss the action or enter a default judgment.

The amendments to Rule 37 are meant to take into account the exponential growth of ESI, and in particular, the preservation and loss of ESI, which have been major issues confronting parties and courts and have caused a significant circuit split on the level of intent, if any, required for a court to impose sanctions for the loss of ESI.

The amended rule establishes preliminary requirements that must be satisfied before a court may consider whether sanctions are appropriate for the loss of ESI.  First, the ESI should have been preserved in the anticipation or conduct of litigation.  This duty is not new; it is based on the common-law duty established through case law.  The Advisory Committee Notes warn that, in some cases, there may be an independent requirement to preserve information established from other sources, including statutes, administrative regulations, an order in another case, or a party’s own policies.  Failure to preserve ESI pursuant to those independent duties, however, does not necessarily establish that a party made unreasonable efforts to preserve information in the action at issue.  In deciding whether and when a duty to preserve arose, the Committee has advised courts to “consider the extent to which a party was on notice that litigation was likely and that the information would be relevant.”

Second, the party must have failed to take “reasonable steps.” According to the Committee, “it does not call for perfection.” Whether a party’s action was reasonable depends on proportionality and courts should consider a party’s resources and preservation efforts.

Third, the lost ESI cannot be restored or replaced.  This is an important requirement because as the Committee makes clear, “[i]f the information is restored or replaced, no further measures should be taken.”  Moreover, in line with the larger theme of the 2015 Amendments, any additional discovery required to restore or replace information should be proportional to the importance of the information.

If these preliminary requirements are satisfied, and the court finds prejudice on the other party from the loss of information, then the court has discretion to order curative measure that are “no greater than necessary to cure the prejudice.”  The rule does not place the burden on one party to prove or disprove prejudice, leaving judges with discretion to determine how to assess prejudice.

Alternatively, if the party who lost the ESI acted with the intent to deprive the other party of the information, a court may take more severe measures – presume the information was unfavorable to the party that lost it, provide a negative inference jury instruction, or even dismiss the case.  Note, that this subdivision does not require a finding of prejudice.  Further, the Committee warns that “[c]ourts should exercise caution . . . in using the[se] measures,” and states that finding an intent to deprive the other party of information “does not require a court to adopt any of the[se] measures” because the remedy should be proportional to the wrong.

III. CONCLUSION

These amendments are perhaps the most significant changes to the FRCP in the last two decades.  For this reason, attorneys litigating in federal court must be especially vigilant in familiarizing themselves with these amendments, which represent a marked change in how civil litigants operate in federal court.

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Federal Court Nixes City’s Attempt to Use Copyright Law to Curtail Critic’s Speech on YouTube http://www.medialawmonitor.com/2015/09/federal-court-nixes-citys-attempt-to-use-copyright-law-to-curtail-critics-speech-on-youtube/ Mon, 21 Sep 2015 07:02:30 +0000 http://www.medialawmonitor.com/?p=3003 By Thomas R. Burke, Dan Laidman, and Diana Palacios

A California city cannot hold one of its citizens liable for copyright infringement for using clips of city council meetings in his critical YouTube videos, a federal judge has ruled.

The August 20, 2015 order in City of Inglewood v. Joseph Teixeira, 2015 WL 5025839 (C.D. Cal. Aug. 20, 2015), makes clear that California governmental agencies cannot enforce copyright in public records absent specific statutory authorization. The decision by United States District Judge Michael W. Fitzgerald of the Central District of California also bolsters a growing consensus among federal courts that it is proper to dismiss copyright actions on the basis of fair use at the earliest stages of the proceedings where the defense is apparent from the works themselves.

The action arose from several documentary-style videos posted to YouTube by Joseph Teixeira, a resident of Inglewood, a city of about 112,000 people located near Los Angeles International Airport. The videos are sharply critical of the public statements and conduct of Inglewood Mayor James T. Butts, Jr. at city council meetings. They feature short clips from the city’s official recordings of these public proceedings, heavily modified with original text and narration that consists of Mr. Teixeira responding to the mayor’s remarks and criticizing his political positions.

In one video, for example, Mr. Teixeira juxtaposes his original footage documenting traffic problems near a well-known Inglewood event venue with short clips of Mayor Butts positively characterizing the traffic situation in remarks at a council meeting. He also criticizes the mayor’s remarks directly with on-screen text superimposed over the meeting footage and narration accusing the mayor of lying. Other videos use similar techniques to address municipal issues such as crime, governmental transparency, and a controversy about the mayor’s residency at the time he ran
for office.

The city filed suit against Mr. Teixeira on March 12, 2015, claiming that his use of footage from the city’s public meeting videos constituted copyright infringement. The city’s complaint sought actual damages and attorneys’ fees, as well as injunctive relief.

Mr. Teixeira moved to dismiss, arguing that:
(1) the city is precluded by California law from asserting copyright protection in public records of its council meetings and (2) his videos are protected by the fair use doctrine. In a comprehensive opinion granting Mr. Teixeira’s motion and dismissing the complaint with prejudice, the court agreed with both points.

On the threshold issue, the court noted that while the “Copyright Act bars protection for works created by the federal government, … whether state and local governments can claim copyright protection is governed by state law.” After examining the relevant state law, the court concluded that “absent particular statutorily provided exceptions, California public entities are prohibited from enforcing any copyrights they may acquire as a matter of federal law. Whether in the eyes of federal law the city holds a copyright in the videos is irrelevant in the face of the state’s decision that its entities may not act to enforce that copyright.”

The court relied primarily on the California Court of Appeal’s decision in County of Santa Clara v. Superior Court, 170 Cal. App. 4th 1301 (2009).  That court reasoned that the California Constitution and California Public Records Act (CPRA) create a broad presumption of unrestricted disclosure of public records that “overrides a governmental agency’s ability to claim a copyright in its work unless the legislature has expressly authorized a public records exemption.” Id. at 1335. The court also noted that California has a number of statutes specifically authorizing public agencies to assert copyright protection in certain enumerated items, such as computer software and educational materials, suggesting that such specific statutory authorization is a prerequisite to copyright enforcement. Id.

Because Inglewood did not identify any specific grant of authority permitting it to enforce copyright protection in its video recordings of its city council meetings, the court held that its complaint failed as a matter of law.

The court also proceeded to consider Mr. Teixeira’s alternative argument that his videos are protected by the fair use doctrine. Citing recent case law such as the 7th Circuit’s opinion in Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687 (7th Cir. 2012), the court found it appropriate to resolve Mr. Teixeira’s fair use argument on a motion to dismiss because it was clear that the defense applied based on a review of the allegedly infringing works themselves, which were incorporated by reference into the complaint. Before issuing its ruling, the court allowed Inglewood to conduct limited discovery solely to confirm the authenticity of the copies of the videos that Mr. Teixeira submitted to the court.

The judge determined that each statutory factor favored a finding of fair use: (1) Mr. Teixeira’s videos are “quintessential transformative works for the purpose of criticism and commentary on matters of public concern” (while Mr. Teixeira’s videos are non-commercial, the court found them to be transformative even assuming a commercial use for the sake of argument); (2) given the “barely creative nature” and “informational purpose” of the council meeting videos, “they enjoy very narrow copyright protection”;  (3) Mr. Teixeira “uses only small portions of the total works and uses them for very specific and particular purposes”; and (4) “there can therefore be no commercial market for the city council videos and no activity by Teixeira can deprive the city of any revenue,” given that California law bars the city from charging anything more than the “direct costs of duplication” when providing copies of public records. Moreover, the court found that Mr. Teixeira’s sharply critical videos would not be a substitute for the city’s unadorned council meeting videos, even assuming a market could exist.

In sum, the court concluded that it could “scarcely conceive of works that are more appropriately protected by the fair use doctrine … than the Teixeira Videos. He is engaged in core First Amendment speech commenting on political affairs and matters of public concern.” Finding that any amendment would be futile, the court dismissed the city’s complaint without leave to amend.

 

Davis Wright Tremaine LLP attorneys Thomas R. Burke, Dan Laidman, and Diana Palacios represent Mr. Teixeira in this matter.

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Game Over: Judge Finds for CBS in $800 Million Right of Publicity Lawsuit by College Athletes http://www.medialawmonitor.com/2015/09/game-over-judge-finds-for-cbs-in-800-million-right-of-publicity-lawsuit-by-college-athletes/ Fri, 18 Sep 2015 09:10:23 +0000 http://www.medialawmonitor.com/?p=3008 By Bruce Isaacs

A federal judge called foul on a right of publicity lawsuit filed against CBS by a former college football player who sought to form a class action seeking approximately $800 million in damages, granting CBS’s motion for summary judgment and denying the players class certification. The lead plaintiff, University of Texas–El Paso player Yahchaaroah Lightbourne, had claimed that his and other former and current college athletes’ right of publicity was violated when numerous photographs taken of them at college sporting events were posted on the universities’ own websites.

On July 30, 2015, in the case of Lightbourne v. CBS Interactive, et al., No. 8:13-cv-00876-JLS (C.D. Cal.), Lightbourne’s motion for class certification was successfully defeated.  On August 14, 2015, the court disposed of all of the remaining claims when it granted CBS’s motion for summary judgment.

The Denial of Lightbourne’s Motion for Class Certification

In denying Lightbourne’s motion for class certification, the court reasoned that individual issues predominated over common issues and, therefore, the requirements for class certification could not be satisfied. The court set forth various individual issues, which predominated over common issues, including the issues of express consent, implied consent, the substantive law of each state as it relates to a right of publicity claim, statutory damages, and other individual issues.

The court concluded that it would have to conduct mini-trials on each of these individualized issues on a photograph-by-photograph basis, which would make a class action impractical, unmanageable, and not a superior way to adjudicate the controversy.

The court recognized that Lightbourne was a resident of the state of Wyoming and that he played football for a university located in Texas (and had not played any football games in California). The court further emphasized that potential class members would reside in and would attend universities in many different states and that each of these states had a stronger interest in enforcing their own particular right of publicity laws than did the state of California (Lightbourne sought to apply California law), especially since the substantive law of the various states differed greatly.

The court also concluded that because California law provides for a mandatory award of attorneys’ fees (assuming, for sake of discussion, that California law did apply), then there is no reason why a class action would be more efficient than individual actions. Also, since Lightbourne himself signed an express consent form, it could not be persuasively argued that he was a typical or adequate representative for the plaintiff class.

The Grant of CBS’s Motion for Summary Judgment

In granting CBS’s motion for summary judgment, the court reasoned that Lightbourne had given his express consent when he signed a document titled “Student-Athlete Image Authorization,” which permitted Lightbourne’s university (the University of Texas–El Paso) and its agents to use, sell, and distribute his image.

Lightbourne argued that the NCAA rules negated his express written consent, but the court rejected this argument and specifically concluded that NCAA Rule 12.5.2.2 did not vitiate Lightbourne’s express consent. In addition, the court ruled that Lightbourne’s purported understanding of the consent form and his unspoken subjective intent in connection therewith
were irrelevant.

Accordingly, because his consent was undisputed, Lightbourne could not establish the prima facie elements of a right of publicity claim under California law and thus the court determined that CBS’s motion for summary judgment was well taken and should be granted.  The court likewise ruled that CBS is the prevailing party and is entitled to recover its attorneys’ fees under California Civil Code Section 3344 in an amount to be determined by subsequent motion.

 

CBS was represented by Weil, Gotshal & Mangesin New York and Bruce Isaacs of Davis Wright Tremaine in Los Angeles.

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Re-hitching the Horse: Oregon Court of Appeals Adjusts the Anti-SLAPP Cart http://www.medialawmonitor.com/2015/08/re-hitching-the-horse-oregon-court-of-appeals-adjusts-the-anti-slapp-cart/ Mon, 31 Aug 2015 22:13:05 +0000 http://www.medialawmonitor.com/?p=3011 By Derek Green and Duane Bosworth

Although Oregon is in its 15th year of anti-SLAPP litigation under a decidedly robust statute, no Oregon appellate court had ruled on how to decide when Oregon’s anti-SLAPP statute applies until the recent decision in Mullen v. Meredith Corporation, 271 Or. App. 698 (2015). In that matter of first impression, the Oregon Court of Appeals corrected the “cart before the horse” approach taken by the trial court, which had ruled that a claimed tortious broadcast was not “protected speech” and thus did not fall within the scope of the anti-SLAPP statute.

Background

A state penitentiary guard and his wife brought four claims arising out of a television news broadcast concerning gunfire in plaintiffs’ neighborhood. The guard alleged that he allowed a reporter to film from his property on the condition that his image not be used in the news broadcast. He said he told the reporter he had received death threats from current and former inmates and needed to keep the location of his home unknown.

The initial evening news broadcasts did not include the guard’s image, but a subsequent morning news report was recut and that version showed plaintiff outside his home for several seconds. The guard alleged that colleagues and multiple inmates saw him on television and one inmate told plaintiff he now knew where he lived. Plaintiffs immediately left and put their home up for sale.

Plaintiffs sued defendants for: (1) breach of contract, based on a promise not to show plaintiff in the news report; (2) negligence, based on the broadcast of plaintiff’s image; (3) negligent infliction of emotional distress; and (4) intentional infliction of emotional distress.

Defendants moved to strike the three tort claims under the state’s anti-SLAPP law, ORS 31.150 et seq. The trial court denied the motion, finding that the anti-SLAPP statute did not apply to plaintiffs’ claims, and defendants appealed.

Court of Appeals Decision

Step One: Applicability

Among other matters, Oregon’s anti-SLAPP statute broadly applies to “any claim in a civil action that arises out of … any … conduct in furtherance of the exercise of … the constitutional right of free speech in connection with a public issue or an issue of public interest.” The trial court framed the issue of whether the anti-SLAPP statute should apply in terms of “whether defendants were entitled to show [plaintiff’s] ‘likeness,’ identity and location as part of the news broadcast.” The court concluded that showing the plaintiff was “not necessary” in order to convey the news. The court added that showing him, which was additionally a breach of contract, could not be “in furtherance of the exercise of … the constitutional right of free speech” because it was illegal and tortious. Showing plaintiff could not, therefore, be “protected speech” to which anti-SLAPP applies. Finally, the court concluded that plaintiff was not a public figure so showing him could not be “in connection with a public issue or an issue of public interest.”

In reversing the trial court, the Court of Appeals found:

“[A]t plaintiffs’ urging, [the court] narrowed the focus [of whether the anti-SLAPP statute applied] to the specific portion of defendants’ conduct that plaintiffs found objectionable. With respect, that inquiry puts the proverbial cart before the horse.”

In other words, whether speech or conduct is actionable is a matter for the second step of analysis under the anti-SLAPP statute, not the first step concerning applicability. The appellate court held that the trial court’s consideration of whether the objected-to speech was “necessary” was not proper. Similarly, the trial court’s consideration of whether plaintiff was a public figure was misguided and not itself probative of whether the anti-SLAPP statute applied. Instead, the appellate court noted, “as plaintiffs conceded, and the trial court recognized, ‘the news reports of the shooting constitute an issue of public interest.’” The court held that “it follows that plaintiffs’ claims arise from conduct in furtherance of the exercise of the constitutional right of free speech in connection with an issue of public interest.”

Analysis of the trial court’s ruling shows that it was confused by the frequently repeated appellate court statement that anti-SLAPP statutes apply only to “protected speech.” Some trial judges, as here, have believed they must first determine whether all of the speech in question is “protected,” that is, nonactionable, in order to decide whether the statute applies. That inquiry would make step one analysis superfluous and would put “the cart before the horse,” as the appellate court noted.

Confusion arises from the imprecise use and understanding of the phrase “protected speech.” Anti-SLAPP statutes set out categories or kinds of speech to which the statutes apply. Those kinds of speech are “protected” in the sense that the special mechanism of anti-SLAPP analysis applies to them and accordingly claims may be quickly dismissed, often before discovery and with attorney fee assessments. Step-one analysis does not ask whether all speech at issue is “protected” in the sense of being “nonactionable,” only whether the speech is of the kind described, to which anti-SLAPP analysis applies.

Step Two: Probability of Success Regarding the Tort Claims

The decision in Mullen is the first Oregon appellate decision to reverse a trial court decision that the anti-SLAPP statute did not apply to the speech in question. Because of its initial decision, the trial court did not reach the second issue of whether plaintiffs had established “a probability that [plaintiffs would] prevail on a claim by presenting substantial evidence to support a prima facie case.” In ruling on a second issue of first impression, the appellate court held that because “that question was fairly presented to the trial court”—even though that court did not reach the question—“and the record was sufficiently developed to enable … review,” the appellate court could proceed to answer
the “probability,” or second-step question.

The appellate court first set out the bases for this analysis. First, a court accepts as true all evidence favorable to the plaintiffs. Second, it considers the supporting and opposing affidavits submitted by both parties, but it does not weigh plaintiffs’ evidence against defendants’. Third, it considers defendants’ evidence and argument “only to determine if it defeats plaintiff[s’] showing as a matter of law.” Applying these standards, the court of appeals determined that plaintiffs had not established a prima facie case regarding any of the three tort claims; that is, plaintiffs had not provided evidence to support every element of any of the claimed torts.

Of particular interest, the court found that plaintiffs would need to have evidence of a “special relationship” between plaintiffs, on the one hand, and the station and reporter, Mark Hanrahan, on the other, in order to proceed with either the negligent publication or the negligent infliction of emotional distress claim, absent allegation of personal injury. As the court explained:

Here, defendant Hanrahan and plaintiff were strangers to each other before the agreement, which was limited to the term that defendants could come onto plaintiffs’ property if they agreed not to air plaintiff’s likeness. That agreement did not form a special relationship; defendants were not acting as plaintiffs’ agents, and plaintiffs did not relinquish control of matters to defendants that required them to exercise independent judgment on plaintiffs’ behalf. That is so because plaintiffs could not relinquish control of an activity—filming, editing, or broadcasting a news report—that they never had in the first place. Thus, defendants did not owe a heightened duty to plaintiffs that would support a claim for noneconomic damages absent a personal injury.

Similarly, plaintiffs’ claim for intentional infliction of emotional distress failed because plaintiffs could present no evidence that defendants intended to harm them. “At most, defendants unreasonably failed to make all of their employees aware of the promise made to plaintiff and to prevent the harm that could follow from breaking that promise.”

The appellate court dismissed the three tort claims and remanded to the trial court for consideration of the contract claim, only. While plaintiffs’ tort claims were for $1.5 million, the smaller amount they could obtain under the contract claim was less than the amount of attorney fees that were likely to be awarded against them; an award of reasonable attorney fees to a prevailing movant is mandatory under Oregon’s anti-SLAPP statute. As a result, the matter quickly ended when plaintiffs agreed to dismiss all claims with prejudice and without payment to any party.

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Censorship by Fire http://www.medialawmonitor.com/2015/08/censorship-by-fire/ Fri, 28 Aug 2015 22:15:49 +0000 http://www.medialawmonitor.com/?p=3014 By Robert Corn-Revere

One recent outrage perpetrated by members of ISIS, the Islamic terrorist movement, is that they don’t just burn people, they burn books, too.

Last February, ISIS members burned the Mosul public library and along with it more than 8,000 rare old books and manuscripts. Across Anbar province in Western Iraq, local officials report the ISIS campaign has burned more than 100,000 titles.

And they haven’t confined their activities to books. ISIS thugs also destroyed 3,000-year-old statues at the Mosul Museum and at an archeological site, smashing priceless antiquities with sledge hammers and power drills. This war on culture brings to mind the Taliban’s destruction of the standing Buddhas of Bamiyan in March 2001.

That such barbarous acts are being perpetrated in the birthplace of writing and of civilization itself makes them all the more tragic. But it hardly makes them unique.

It is not just the likes of ISIS—people who would have to progress 1,000 years to be considered medieval—who favor censorship by fire. Burning books that espouse hated ideas—and in the past, their authors as well—is perhaps the oldest form of censorship.

And it never seems to go out of fashion. Last November 5 (Guy Fawkes Day in the U.K.), a battered women’s refuge in England hosted a public book burning of the potboiler Fifty Shades of Grey, calling it a manual for abuse. But some frustrated husbands in Ohio beat the shelter to the punch (so to speak), having torched copies of the mommy-porn novel on the ground that their wives were too busy reading the steamy book to pay attention to them in the bedroom.

Historical examples of book burning are too numerous to list in a short article, but they date back to antiquity. The Babylonians and their allies burned the library of the scholar King Ashurbanipal in 612 B.C. when they sacked the Assyrian capital of Nineveh. In 213 B.C. Chinese Emperor Qin Shi Huang ordered the burning of all history and philosophy books from states other than Qin (in addition to burying intellectuals who disputed state dogma). And the works of the Greek philosopher Protagoras were gathered and burned in the marketplace in Athens because he dared to question whether the gods exist.

Although religion is far from the only motive for book burnings, a belief in the supernatural often is what fans the flames. Antiochus IV ordered Jewish books in Jerusalem be “rent to pieces” and burned in 168 B.C.; the Emperor Constantine ordered the burning of works by those who disputed the Trinity; the Christian Emperor Jovian burned the library of Antioch in 364 A.D., because it had been stocked largely by Emperor Julian who was non-Christian; and in 392 A.D., the library at Alexandria was looted and burned by Christian mobs and the woman philosopher Hypatia murdered.

The religious conflicts that divided Europe in the Middle Ages (and beyond) continued the tradition of book burning. Pope Gregory IX prevailed on King Louis IX to destroy all copies of the Talmud in Paris  in 1242. About 12,000 volumes were burned after being “tried” by the crown and “convicted.” In 1401, the English Parliament under King Henry IV passed a law titled “On the Burning of Heretics” that required the collection and public burning of heretical works. In the decade before 1500, the Spanish Inquisition ordered the wholesale burning of Jewish and Arabic texts. In 1499, for example, the Archbishop of Toledo publicly burned 5,000 Arabic manuscripts in Granada’s public square. By order of the Pope, Martin Luther’s German translation of the Bible was burned in 1624 in those parts of Europe controlled by Catholics (although for his part, Luther himself burned Papal decrees).

Of course, it wasn’t just books that were consigned to the flames. A common punishment for heresy was to be burned at the stake along with the offending works. For example, the Inquisition in Rome condemned the heretic Cecco d’Ascoli to such a fate in 1327 for his book Acerba and such was the practice for hundreds of years. The Calvinist-dominated City Council of Geneva in 1553 ordered that Michael Servetus be burned at the stake with his manuscript along with a copy of a printed book tied to his waist. His crimes?  Preaching non-trinitarianism and opposing the baptism of infants.

In the 20th century, book burning is most closely associated with Nazi Germany, and for good reason—the Nazis wanted to be known for it. On May 10, 1933, Nazi youth groups burned some 25,000 “degenerate” books at a large bonfire in Berlin, with radio broadcasts to publicize the event to those who could not attend in person. Books by such authors as Albert Einstein, Bertolt Brecht, Helen Keller, Sigmund Freud, Thomas Mann, Karl Marx, Ernest Hemingway, and H.G. Wells were tossed on the flaming heap. Similar events were held throughout Germany in the 1930s and 40s, and 40,000 people attended a speech by Joseph
Goebbels describing the events.

Freud would later quip, “What progress we are making. In the Middle Ages they would have burned me. Now, they are content with burning my books.”  But Freud probably is fortunate he didn’t stick around in Vienna after the Nazis annexed Austria to find out if that was true.

Book burning isn’t associated as much with the United States, given our unique First Amendment protections, but even in this country it is a well-established tool among the champions of censorship. From the colonial period, William Pynchon’s book The Meritorious Price of Our Redemption was banned in 1651 for criticizing the Puritans, and all known copies were publicly burned.

Book burning became institutionalized in the late 19th century after Anthony Comstock persuaded Congress to adopt a federal obscenity law in 1873. Comstock, who headed the New York Society for the Suppression of Vice, made no bones about his purpose. The seal for the New York Society depicted on one side a constable ushering a miscreant to jail, and on the other, a Victorian gentleman stoking a large fire with armloads of books.

The law Comstock promoted, and which he helped enforce as a special agent of the Post Office, banned any book or other item even remotely related to sex, including information on contraceptives. And Comstock kept close track of the material he seized and destroyed—usually by fire. By the time he died in 1915, Comstock claimed to have burned some 15 tons of books, as well as 284,000 pounds of printing plates for “objectionable” texts (which were melted down), and nearly four million pictures. While he didn’t set the authors ablaze as did his predecessors, Comstock boasted that he drove a number of writers and booksellers to suicide.

Official book burnings faded away as the Supreme Court developed a strong First Amendment jurisprudence in the mid-to-late 20th century. But “unofficial” book burnings persist. In 1948, stoked by pseudo-scientific theories that blamed juvenile delinquency on comic books, a number of communities around the country held public burnings of comics. The obvious parallel to Nazi Germany apparently was lost on the organizers.

Similarly, in 1966 a number of communities across the Bible Belt in the southern U.S. publicly burned Beatles records in reaction to an out-of-context John Lennon quote that the band was “more popular than Jesus.” Evangelists, some southern disc jockeys, and the Ku Klux Klan urged people to bring records and band merchandise to throw on the bonfires at anti-Beatles rallies. And so they did.

Did the Beatles cease to exist as a result, or become less popular than Jesus? Of course not (although 1966 marked their last tour as a band). But burning is a peculiar form of censorship in that the act itself is intended to send a message. This is why book burning is a public spectacle. It is designed to express outrage and contains within it the notion that the ideas contained in the books or other works of art should be obliterated entirely.

In less enlightened times—a place where ISIS still lives—it was more possible to believe that ideas could be assassinated along with their authors. But even in ancient times the censor’s power was limited.

The Islamic philosopher Averroes, who was largely responsible for preserving the legacy of Aristotle in Western thought, fell out of favor with the ruling authorities at the end of the 12th century, and his writings were ordered to be burned. As he stood watching the blaze, he told one of his students who was openly weeping, “Today I cry over our situation . . . but the ideas have wings.”

 

Robert Corn-Revere is a partner at Davis Wright Tremaine LLP in Washington, D.C., where he practices First Amendment law. A version of this article was first published under the title “Bonfires of Insanity: A History of Book Burnings From Nazis to ISIS” on the website The Daily Beast on February 28, 2015.

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New York’s Proposed Right of Publicity Statute for Dead Celebrities is Apparently Dead Itself http://www.medialawmonitor.com/2015/08/new-yorks-proposed-right-of-publicity-statute-for-dead-celebrities-is-apparently-dead-itself/ Wed, 26 Aug 2015 22:21:39 +0000 http://www.medialawmonitor.com/?p=3018 By Elizabeth McNamara and Camille Calman

As New York’s legislature struggled to reach the end of its extended 2015 session, a bill proposing a statutory right of publicity for the deceased languished in committee, where it looks destined to die.  We view this as a positive development, since the bill represented a significant departure from New York’s longstanding law on the right of publicity, which has always been strictly confined to the living. The bill contains definitions that are so vague as to be unworkable and raises more issues than it solves. We hope that the legislature will not reintroduce this flawed bill in future sessions.

There is no question that dead celebrities sell. Years after their deaths, celebrities appear in advertisements for all manner of products. Frank Sinatra endorses “Jack Daniels Sinatra Selects.” Bob Marley’s face appears on every product from the Marley Beverage Company. Audrey Hepburn danced across the screen for the Gap and appeared in CGI form in a British ad for chocolate bars. Dior resurrected Marilyn Monroe, Grace Kelly, and Marlene Dietrich for a perfume ad, and Monroe’s voice and likeness were featured in ads for Chanel No. 5. Fred Astaire danced with a Dirt Devil vacuum cleaner, and John Wayne advertised Coors beer.

Given the money involved in posthumous endorsements, it’s not surprising that celebrities’ heirs have argued for a posthumous right of publicity. Many states have enacted statutes extending the right of publicity past death. For example, California extends the right of publicity to “deceased personalities,” whose name, voice, signature, photograph, or likeness had commercial value in their lifetime for 70 years after their death.  Indiana protects “name, voice, signature, photograph, image, likeness, distinctive appearance, gestures, and mannerisms” during life and for 100 years after death. Tennessee, home of the late Elvis Presley, provides protection indefinitely, as long as the deceased’s publicity rights are still being exploited. In other states, courts have found that the common-law right of publicity survives death.

New York is the residence of countless public personas so that any change in the law here will necessarily have significant impact. The New York bill, S.5650/A.7904, is titled “An act to amend the civil rights law and the civil practice law and rules, in relation to the right of publicity.” It would extend the right of publicity for 70 years after death for anyone- not just those whose persona had, or was exploited for, commercial value during their lives. The bill would create a property right in a deceased individual’s persona, “freely transferable or descendable, in whole or in part, by contract or by means of any trust or testamentary instrument, whether such  contract, trust or testamentary instrument was entered into or executed before or after the effective date of this article.” Anyone who uses “any aspect” of a deceased individual’s “persona” for commercial purposes would have to obtain prior written consent of the deceased’s heirs. “Persona” is broadly defined to include “name, portrait, picture, voice, signature, photograph, image, likeness or distinctive appearance, gesture, mannerisms or other indicia of a deceased individual.”  The statute would apply to anyone who died while domiciled in New York on, after, or within seventy years before the effective date of the statute. The rights granted are explicitly retroactive and are deemed to have existed at the time of death. The statute attempts to grapple with the fact that those already deceased would have been unlikely to leave specific publicity rights in a will, by providing that a bequest of “the residue of the deceased individual’s assets” is sufficient to have transferred the newly-created rights. Id.

New York’s right of publicity has traditionally been strictly defined under Sections 50 and 51 of the New York Civil Rights Law, which prohibits the use “for advertising purposes, or for the purposes of trade” of the name, portrait, picture, or voice of any living person. The Court of Appeals has emphasized that Sections 50 and 51 should be “narrowly construed” and subject to a broad newsworthiness exception Although some New York courts have recognized a “proprietary interest” in a living celebrity’s public personality, Sections 50 and 51 have always been held not to create any assignable or descendible right. The proposed statute would shift the balance dramatically.

The bill’s “Justification” section explains that “New York’s deceased personalities, in many instances, spent entire careers building reputations and bodies of work that are a property right that should not be extinguished with their passing. This property right should also be protected after their passing . . .” Query, however, whether the statute would achieve these goals. The statute’s protection is not limited to persons who “spent entire careers building reputations and bodies of work;” it equally applies to the accidentally famous and the not-famous-at-all. Furthermore, it does nothing to protect the deceased’s “reputations” or “bodies of work”; it merely vests in the deceased’s heirs the right to decide how her persona will be exploited. The heirs may have their own ideas about exploiting their newfound property right, which may have little to do with reputational protection or honoring the deceased’s wishes. Personas would be transferred from the public domain to individual heirs, which would certainly benefit the heirs, but perhaps to the detriment of the public.

The proposed statute would also create broader rights for the dead than the living.

  • First, a large body of case law strictly construes the application of Sections 50 and 51 to commercial advertising or trade, while favoring the First Amendment right to use a person’s name and likeness in editorial and creative works.) The new statute recognizes First Amendment rights by including exemptions for works of “political or newsworthy value concerning public interest” and for specifically enumerated creative works such as books, plays, original musical compositions, motion pictures, original works of fine art, and television programs (but, oddly, not radio programs). But the vagueness of some of the terms virtually invites protracted litigation. Who will decide whether a work has “political or newsworthy value concerning public interest,” and isn’t newsworthiness a question of editorial judgment, as New York courts have long held? Who will decide what is or isn’t a “work of fine art”?
  • Second, the definition of “persona” in S.5650/A.7904 is broader than the rights protected in Sections 50 and 51. “Persona” includes not only names, likenesses, and voices, but signatures and “distinctive appearance, gesture, mannerisms or other indicia of a deceased individual.” This vague definition is unworkable—how should a court determine whether a “gesture” or “mannerism” is sufficiently distinctive to call to mind a particular deceased individual?

In addition, creators of expressive works about deceased celebrities may be constrained in promoting those works. The creative-works exemption applies only as long as the work does not “constitute an advertisement, endorsement or solicitation for the sale or purchase of a product, article of merchandise, good or services, other than for the work itself.” As the New York State Bar Association Committee on Media Law pointed out when opposing a similarly-worded bill in 2013, a Broadway musical about Marilyn Monroe could use Monroe’s persona artistically, but might face liability for selling merchandise such as posters or t-shirts, which could threaten the economic viability of the production.

And what about dead criminals? Under the bill, their heirs can inherit and exploit their posthumous rights of publicity. How will this interact with New York’s “Son of Sam” law, which prohibits criminals from profiting from their crimes? If a deceased criminal’s heirs inherit and exploit the criminal’s persona, will the crime victims be compensated? Or does the right of publicity descend to the heirs unencumbered by the victims’ “Son of Sam” rights?

Finally, this statute could create a retroactive right of publicity for photographs and videotapes in archives. Photographers who took iconic photos of Marilyn Monroe (and obtained releases from her) have long wrangled with her heirs over who may exploit those photos.  Photographers whose life’s work includes photographing celebrities might be challenged in court by heirs who argue that the photographers’ release forms did not assign posthumous rights to exploit the images for commercial purposes—or that a release granted rights to the celebrity’s likeness but not his “gestures” and “mannerisms” since statutory rights to those traits vest only in the heirs, not the living celebrity.

Ultimately, S.5650/A.7904 would remove from the public domain the personas of anyone who dies while domiciled in New York, and bestow their personas on their heirs. But as drafted, the statute would extend the right of publicity far beyond the limited publicity right of Sections 50 and 51 (the only such right that New York courts recognize). It would almost inevitably lead to litigation; could have a chilling effect on First Amendment rights; and could raise other, unanticipated problems. We hope the Legislature will not revive this troubling bill in future sessions.

 

Elizabeth McNamara is a partner in the New York office of Davis Wright Tremaine.Camille Calman is an associate at the firm. Reprinted with permission from the June 30, 2015, edition of the New York Law Journal © 2015 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited. ALMReprints.com – 877-257-3382 – reprints@alm.com.

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FTC Considers Facial Recognition Parental Consent Method Under COPPA Rule http://www.medialawmonitor.com/2015/08/ftc-considers-facial-recognition-parental-consent-method-under-coppa-rule/ Mon, 24 Aug 2015 22:25:54 +0000 http://www.medialawmonitor.com/?p=3021 By Ronald G. London and Bryan Thompson

The Federal Trade Commission announced on July 31 that it is seeking public comment on a new verifiable parental consent method set forth in an application submitted by Riyo under the Children’s Online Privacy Protection Act (COPPA) Rule. If approved by the FTC, Riyo’s proposed mechanism would allow entities to obtain verifiable parental consent through a two-step facial recognition process.

Under the FTC’s COPPA Rule, websites and online services that collect personal information online from children under 13 must obtain verifiable parental consent authorizing the collection, use and/or disclosure of a minor’s information. The rule also specifies several methods of gaining parental consent, and allows parties to submit and seek FTC approval of additional means for obtaining consent not currently permitted by the rule. Parties must demonstrate to the FTC that any new method is substantially different from an already approved verification method, and how it is “reasonably calculated, in light of available technology, to ensure that the person providing consent is the child’s parent.”

According to Riyo’s application, its proposed consent method would first require a parent to capture an image of his or her photo identification via a smartphone or computer camera. The parent would later provide verifiable parental consent by taking a selfie, which would then be compared against the photo identification image provided earlier. Riyo claims its process would not upload to or rely on third party databases to verify information.

The FTC’s public comment period for Riyo’s proposal ended on September 14, and the Commission is presently reviewing the comments submitted. The Commission’s decision on Riyo’s application is expected sometime this fall. The FTC previously received five applications seeking approval of proposed verifiable parental consent methods, but has approved only the method submitted by Imperium, LLC, which uses knowledge-based authentication to confirm a parent’s identity.

Meanwhile, the FTC has denied consent method applications where the proposed method either is a variation of a method already approved under the Rule, or is not reasonably calculated to ensure that it is the parent providing consent. The FTC most recently denied an application by AgeCheq that proposed the parent enter a validation code and digitally sign on a mobile device to authenticate the parent’s ownership and approval. In denying its application, The FTC claimed AgeCheq’s method “authenticate[d] the device rather than the user.”

Riyo’s two-step facial recognition process substantially differs from the methods that met with recent denials.

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Industry Players Weigh In on Spokeo http://www.medialawmonitor.com/2015/08/industry-players-weigh-in-on-spokeo/ Fri, 21 Aug 2015 23:05:00 +0000 http://www.medialawmonitor.com/?p=3025 By Christin McMeley and Elizabeth Drogula

A few months ago, we reviewed the U.S. Supreme Court’s decision to grant certiorari in Spokeo, Inc. v. Robins, 135 S. Ct. 323 (2014), and the implications that a ruling in the case will have on the landscape of litigation under privacy statutes. Since then, the petitioner, Spokeo, and numerous amici have filed briefs addressing the issue before the Court: whether Congress can confer Article III standing on a plaintiff that has not suffered a concrete injury, thus allowing that plaintiff to sue in federal court based on the bare violation of a statute—in other words, whether Article III standing can exist based on an injury-in-law and in the absence of an injury-in-fact.

Many of the amici focused on the effect of technology on businesses’ exposure to liability, describing how media and technology companies, and technology-dependent businesses, engage in an enormous number of transactions with consumers each minute of the day, whether via communications systems, content delivery, ATM and other banking transactions, or any other digital transmission of data. This environment creates, according to the amici, the potential for huge putative classes in actions asserting claims for statutory damages based on those transactions, which is of particular concern in the privacy context, given the statutory damages available under statutes such as the Telephone Consumer Protection Act (TCPA), the Video Privacy Protection Act (VPPA), and similar state statutes. Facing the potentially ruinous consequences of an adverse judgment, and the untenable costs of defending against such suits, the amici argued that it is not surprising that many companies would choose to settle aggregated class claims rather than adjudicate their merits. In many cases, however, such settlements can hardly be considered “missing a bullet.” They can be enormous in their own right, often ranging from several million to tens of millions, such as Capital One’s $75 million settlement of a TCPA class action in February.

Article III standing requirements have served as a check against class plaintiffs pursuing large settlements by bringing spurious claims—specifically, the requirement that plaintiffs sufficiently plead an injury-in-fact (i.e., a particularized harm) to ensure that the jurisdiction of federal courts is invoked to resolve actual cases and controversies rather than purely legal disputes. The amici argued that if the Supreme Court holds that the bare violation of a statute is sufficient to establish Article III standing, the flood gates for ruinous class claims will open, with more than just financial consequences. For instance, a group of media companies and trade groups, represented by Davis Wright Tremaine, argued that doing away with the injury-in-fact requirement raises First Amendment concerns, because “the fear of large civil damages awards, and the mere cost of waging a defense against numerous specious claims, inhibits the development of content by media companies, and thus indirectly chills speech.” At the time of this article’s submission, the respondent, Thomas Robins, had not yet filed his brief on the merits.

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The Fingerprint File Doesn’t Have to Bring You Down: NAI Offers Advertisers Guidance on Digital Fingerprinting & Location Tracking http://www.medialawmonitor.com/2015/08/the-fingerprint-file-doesnt-have-to-bring-you-down-nai-offers-advertisers-guidance-on-digital-fingerprinting-location-tracking/ Mon, 17 Aug 2015 23:09:12 +0000 http://www.medialawmonitor.com/?p=3028 By Christin McMeley and Bryan Thompson

Advertisers who use tools such as location data and newer non-cookie technologies to deliver interest-based advertising must carefully balance the use of those tools with consumer privacy. To achieve this balance, the Network Advertising Initiative (NAI)—a digital advertising self-regulatory body—has recently released guidance for advertisers on how they can do both and stay in compliance with the NAI Code of Conduct.

The NAI released its Guidance for NAI Members: Use of Non-Cookie Technologies for Interest-Based Advertising Consistent with the NAI Code of Conduct (Beyond Cookie Guidance) on May 18, instructing its digital advertising members who conduct Interest-Based Advertising (IBA) and Ad Delivery and Reporting (ADR) how to employ non-cookie technology in line with the NAI’s Code. Then on July 20, the NAI issued its Guidance for NAI Members: Determining Whether Location is Imprecise (Location Guidance), clarifying under what situations members’ use of location data for IBA may be considered “imprecise” and thus not require users’ opt-in consent. Both releases come on the heels of the NAI’s 2015 update to its Code of Conduct that clarified members’ privacy obligations.

Beyond Cookie Guidance

The NAI’s Beyond Cookie Guidance provides baseline best practices for advertisers regarding consumer transparency and notice regarding an advertiser’s use of non-cookie technologies (i.e., mechanisms such as browser cache, locally-stored objects (LSOs), or statistical identifiers to identify a consumer’s browser); providing user controls to consumers in the form of opt-out mechanisms; limitations on the use of data collected; and accountability to the NAI.

The Beyond Cookie Guidance states that it sets “baseline practices” and details how the organization may evaluate advertisers during annual compliance reviews. The NAI also announced that it would work with its members during an undefined “implementation period” to help members understand and employ the baseline practices.

Transparency and Notice to Consumers

The Beyond Cookie Guidance instructs advertisers using non-cookie technology for IBA and/or ADR must include in their privacy policy:

The Beyond Cookie Guidance instructs advertisers using non-cookie technology for IBA and/or ADR must include in their privacy policy:

A general description of the technology or technologies used for IBA and ADR;

A description of, and easy access to, an “easy-to-use opt-out mechanism” where users can prevent IBA, or IBA based on non-cookie technologies, on specific browsers or devices;

A description and link to a consumer transparency tool; and

Updates to statements that browser cookie controls by themselves halt IBA where such representations would be untrue.

Members must also clearly and conspicuously post notices on websites where data is collected for IBA declaring that non-cookie technologies may be used by third parties on the site. Members must make “reasonable efforts” to have such notices posted on their partners’ sites.

Finally, members using non-cookie technologies that cannot be viewed or changed through native browser controls must implement a consumer-facing transparency mechanism that:

Displays on both the member’s page and the NAI opt-out page whether data is collected for IBA using non-cookie technology on a specific browser and the opt-out status; and

Shows an icon or other disclosure on the NAI’s opt-out page informing consumers of the member’s use of non-cookie technology, as well as a link to the member’s site for information about their use of the technology in question.

User Controls

The Beyond Cookie Guidance calls on members to provide an opt-out mechanism, provided on both the members’ respective websites and the NAI’s opt-out page, to give consumers control whether they want data collected via such technologies to be used for IBA. Data collected for non-IBA purposes via non-cookie technologies during an opt-out period may never be used for IBA.

Members will also have to use the NAI’s recently developed opt-out tool—a web-based option that allows a user to set cookies alerting NAI members that the user does not want to participate in IBA—to set opt-out preferences and to learn and honor consumers’ preferences.

User Limitations & Accountability

If a member makes a material change to its IBA data collection and use policies, the member must obtain opt-in consent from consumers before applying those changes to any previously collected data.

Finally, the NAI requires its members to take the following steps for accountability purposes:

Allow the NAI to conduct “reasonable technical oversight,” or, failing that, work with NAI staff to develop a regimen allowing compliance teams to engage in external technical oversight.

Members’ opt-out inspection services should give the NAI the means to determine whether ad interest profile changes have been make following a post-opt-out decision, or some other method enabling NAI compliance staff to determine member compliance with the Guidance and the Code.

Location Guidance

Under the 2015 updates to the NAI’s Code, members are required to obtain a user’s opt-in consent to use his or her Precise Location Data (PLA) for IBA purposes. Accordingly, the NAI’s Location Guidance clarifies when location data is considered imprecise, and thus does not require that members obtain the user’s opt-in consent. The NAI provides the following analysis for members to determine whether they are using PLA that requires opt-in consent:

A member is not using PLA if it does not store or otherwise save location information;

A member’s use of location information is de facto imprecise
if it stores:

Latitude and longitude coordinates with two or fewer
decimal places;

Location sizes in the form of geographic shapes larger
than 785,398 sq. meters; or

Information describing a place larger than 785,398 sq. meters;

A member may also render a location imprecise if, before storing or saving, it enlarges location coordinates to two or fewer decimal places, increases the geographic shape or size that is stored, or uses only general descriptors of the location (e.g., “coffee shop”).

If a member does not meet these benchmarks, it must determine whether the location is imprecise by considering: (a) the location’s area; (b) the area’s population density; (c) the location data’s accuracy; and (d) the presence and detail of a location’s timestamp. While the NAI says that a member will not be in violation of the Code if it conducts a reasonable analysis using these factors and determines that a location is imprecise, the NAI staff may ask a member to subsequently change its practices.

Practical Effect

While the NAI Code of Conduct and related guidance is only directly binding on members, NAI members generally contractually require non-members—including website and mobile applications owners and advertisers—to abide by the NAI’s data collection and use restrictions. Because NAI’s members include many well-known data collectors and aggregators, the practical effect can be ripples of NAI compliance throughout the interest-based advertising ecosystem. Third parties who contractually commit to comply with the NAI’s Code should familiarize themselves with its requirements, which do vary slightly from the Digital Advertising Alliance’s Self-Regulatory Principles. Moreover, while framed as “guidance,” NAI members should treat these releases less like suggested best practices and more like mandatory steps they need to take to avoid adverse actions by the NAI during compliance reviews.

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For Funny Or Die’s Peter Morris, Cutting-Edge Legal Issues Are No Laughing Matter http://www.medialawmonitor.com/2015/08/for-funny-or-dies-peter-morris-cutting-edge-legal-issues-are-no-laughing-matter-2/ Sat, 01 Aug 2015 15:06:34 +0000 http://www.medialawmonitor.com/?p=3031 By Jonathan Segal

Funny Or Die was founded in 2007 by Will Ferrell and Adam McKay as a production company to create comedy shorts on the Internet. Its first video, “The Landlord,” netted 82 million views. In the past few years, Funny Or Die has expanded beyond its digital roots, producing television programs, including “@midnight” with Chris Hardwick, as well as native advertisements, and even political ads. In 2014, Funny Or Die won an Emmy for a special episode of “Between Two Ferns,” pairing Zach Galifianakis with President Barack Obama.

For its inaugural In-House Insider feature, Media Law Monitor sat down with Peter Morris, the Vice President of Business Affairs and Development at Funny Or Die, to discuss the challenges and triumphs of the Funny Or Die legal team.

MLM: So what does your typical day look like as the main lawyer at Funny Or Die?

Peter: Every day is different. One of the things that’s truly wonderful and unique about Funny Or Die is we are always doing exciting and different things. We never stop doing anything, and we continually add new content, platforms, and products. We’re pushing the boundaries in so many different areas of law, from First Amendment issues that we work with your firm on across multiple platforms, as well as legal issues connected to where and how we’re distributing our content, who we’re doing deals with, social media issues including sponsorship and branding in that [social media] world, developing the new self-regulatory rules around that, as well as some of the governmental regulations [surrounding these sponsored/branded social media posts]. It is just a fun experience of always having a list of 30 things to do on your to-do list, and then having 20 that you never expected to hit you dumped in your lap. You’ve got to thrive in an environment where in many cases you have to figure it out on the fly. So I would love to tell you that there is some sort of order or process around my day. But there really isn’t—and that, in so many ways, is what makes it fun and fulfilling.

MLM: What legal issues do you deal with the most in your position?

Peter: There is a lot of attention required to production-related issues, including First Amendment and clearance issues, of course. A lot of business affairs. We’re dealing with negotiations and drafting agreements with all the networks, studios, and the financiers for the projects we’re doing. There are a lot of distribution agreements, along with sales and custom content-creation agreements—whether that’s for our interior sales team on branded entertainment deals with advertisers, our white-label commercial production company, Gifted Youth, or our newest political initiative, FODC. We handle all forms of strategic partnership agreements for Funny Or Die, whether that’s our participation in the Oddball Comedy and Curiosity Festival or our early participation with Facebook in their Facebook Anthology and Facebook Suggested Ads Alpha programs. Because we’re a counsel’s office, we also handle everything from the employment contracts for internal people, issues that come up requiring immediate attention, to any HR issue that arises, to the real estate leases for all of our properties, to business affairs, to legal affairs, to corporate management, to clearances, to licensing, to distribution, to sales, strategic partnerships, acquisitions, to speeding tickets … everything. It just runs the full gamut.

MLM: So what’s surprised you the most since you started in your position here?

Peter: I think one of the things that attracted me to Funny Or Die originally is not what they were doing, but what I thought they could do, which was limitless. And I still believe that. The growth of this company in the four-and-a-half years that I’ve been here I think is the most shocking, staggering thing. When I got here, we were making 15 web videos a month, we had a television pilot deal, and that was it. We now make 20 videos or more a month. We make several big-budget branded entertainment videos every month that are not integrations, but entertaining custom comedic videos around a product or service, distributed and marketed across Funny Or Die’s platforms. We have a portfolio of apps, with more launching every quarter. We have an entire editorial news team that makes an incredible amount of non-video content for all of our different platforms.

We now have roughly 23 television shows or television specials on-air or in some stage of development, versus that one pilot. We also make content—not just repurpose it—but make original content for 17 social media platforms. We have over 30 million social media followers across all those platforms, which makes us the #1 comedy brand in the world across social media. So we make content for all of those areas. And again none of this stuff was being done when I first got here. All of those things are new. And that’s just been incredible to witness.

MLM: So what’s really difficult for you and your team? When do you have OMG moments?

Peter: Every single week, we, the three of us, are doing something that we’ve never done before. And in many cases we’re doing things that no one has ever done before, like the new operation we’ve opened up in D.C.

Traditionally, candidates, super PACs, and independent expenditure groups hire media agencies and creative agencies to create their advertising campaigns, buy their television spots, and create some of the attack ads and things of that nature. But the idea of producing entertaining spots that either promote an issue, a candidate, a specific campaign in some way—done from an actual standpoint of entertainment rather than just pure messaging—it’s really never been done on this scale. So how that fits into federal election laws is new. It’s unique. It’s uncharted territory. So it’s exhilarating and frightening, because it’s something I have had to become well-versed in, and it’s something that, in many cases, no one has ever done before.

MLM: Would you say you guys are the ideal people to start something like that because you make content that people share and spread around?

Peter: The value that you can get here if something pops is really high. But again you’re convincing a very regimented system that in essence has always done something one way from the beginning of television. Really, from John F. Kennedy who was the first president to really utilize television to reach the American public, from that moment until now everyone’s virtually done everything the same way to some degree. I think we were able to prove how valuable this can be with the success of “Between Two Ferns,” featuring President Obama, and we are already seeing organizations come to Funny Or Die to hire us to create original content in connection with their issues.

MLM: Obviously Will [Ferrell] and Adam [McKay] are renowned, but you also have a whole staff of people who are writers and shooters. How do you advise such a wide range of folks, especially non-lawyers?

Peter: It’s about education and just being able to tailor your message in different ways. It’s a little bit broader here, but one of the things we look for in hiring people is someone who can tailor a message to our CEO and President, to our CFO, to our COO, but then also to an editor, a programmer, a sales account executive, a writer, or director who doesn’t look at the world in the same fashion. Being able to get them to understand and learn.

It’s difficult, and it’s a wonderful thing, and it’s what makes this really rewarding and fun. Our goal is to empower our creative staff to make as many decisions as they can and in essence to train them to sort of spot these issues and to know to bring them to us early, and we’ll help them solve it in a way that they want, that’s works for them, but still gives
us protection.

MLM: So what advice do you have for other media lawyers?

Peter: I think the first thing you need to understand is what the priorities of the company are and how your role is viewed from the standpoint of providing value to your company. You have to make sure that you have a good grasp on what the different departments need from you, so that you can prioritize what you’re doing and respond in an effective manner. Are they looking to you simply for risk assessment, to paper deals, or are you involved in the strategy/direction of the company, and are you empowered to be a decision-maker? There are very different roles you might play depending on what those answers are. For example, this is extremely important if you’re at a smaller media company, and your staff is lean and mean, as it should be, everybody comes to you with a bullet wound, and you’re in triage mode at all times. It’s your job to understand based on the landscape of your company how and where to provide the highest level of value to the company, and, in using my analogy, in some ways that can translate to determining who really is bleeding out on that table at that exact moment and how to handle that and who is fine sitting in the waiting room with a bullet room in their shoulder. If you work at a smaller company, as opposed to a large traditional media company, I think it’s really important that you feel empowered and comfortable making decisions. Generally, although not all the time, lawyers at more traditional studios and networks are often not the final decision-makers. If your goal is to be a high-level general counsel with a company that’s dynamic and is going to try things that in many cases have never been done before, you can’t be afraid to make decisions. You need to have the backing of your boss and trust yourself to make the calls and move on. You’re absolutely going to make some mistakes! You do your best to manage those, but if you’re running at 110 miles an hour, you’re going to miss some things that whiz by in your periphery, and that’s okay. You need to learn to constantly assess how much you need to do, what the risks are, and trust yourself to know that you can make the call and keep moving.  And I think that a lot of in-house counsel get bogged down in the process of approvals and the fact that they’re not comfortable making that call. All our attorneys are empowered to make decisions at Funny Or Die, in part because the volume of work is so staggering and never wavering, there is not another option.  Frankly, our internal motto on the legal side is “Ugly but Effective.” Don’t worry about what it looks like, just find a way to make it work, get it done, and keep moving. Bottom line: in dynamic places like Funny Or Die, lawyers have to be willing to make quick decisions as they arise, or you’ll suddenly turn around and realize your company has become “the old guys” who aren’t willing to take risks and try things.

MLM: So, this is obviously a new media Internet-focused company with its origins in the Internet, but you guys produce content that goes into traditional channels and also partner with traditional media providers, like television. What are the cultural and legal differences in the two sides of the business?

Peter: In some ways they are very different cultures. People assume that the Internet is the Wild West, and therefore their practices and actions can be looser, and they take that attitude because you theoretically (and, in many cases, actually) can take a piece of content down with no repercussions. That is not true in many cases for many different digital companies.

Our legal philosophy is to try to approach things from the standpoint of allowing content creators to do innovative things that result in compelling content on any platform that keeps people talking about Funny Or Die, while evaluating things from a broader business perspective, where the actual likelihood of material harm may come into play, not just the goal of eradicating all risk. We do this with a combination of real business evaluation and risk assessment, coupled with creative legal problem-solving/troubleshooting to limit risk if/where we can and being prepared for what may come our way later on. When we are making content just for ourselves on a specific digital platform, I feel more comfortable with us being aggressive and taking that risk because of who we are and where we come from and our attitude and flexibility of working things out with people who may be upset. In general, I feel more comfortable taking risks when we don’t have to indemnify someone else.

In speaking with many of my friends who work at traditional media companies, the culture there is very risk averse, I think to the point of excess, which has slowed their ability to innovate. Traditional media companies: (1) buy a television show from a producer; (2) the network owns all rights to the show; (3) the network requires that production company to fully indemnify them from all third party claims; and (4) the network sets a very regimented policy regarding what the production company can actually do in and in connection with their show. That last one is incredibly burdensome when you are talking about a production company with its own digital platform, brand awareness, and audience (that in some cases is bigger than the network’s) like a Funny Or Die, The Onion, or Fullscreen. They don’t view content production as a partnership or collaborative effort in many ways but as “that’s the toy that I bought … and don’t touch it.” The good news is that is starting to change, and traditional media companies are beginning to both see the value and allow the individual or producer to utilize show elements in new ways on new platforms to build value and market the show. Whether due to want or necessity, this culture is moving more towards what I see in the digital landscape.

MLM: Is there anything else you want to tell me about the company or your job?

Peter: I believe I am the luckiest guy on the planet! These are the most intelligent, cutting-edge people I have ever worked with, and it’s the most fun I’ve ever had at work. It is challenging. It’s exciting. It is never mundane or stale. The essence of Funny Or Die to me came from our CEO when he was interviewing me. When I asked him why he came to work as the CEO at Funny Or Die, he said his goal was to create a company where people could try things without fear of failure. It was simple, eloquent, and I thought it was a complete bullshit line at the time, but after being here for four-and-a-half years, I will tell you that it’s the truth and it’s magical to wake up and come to work in an environment like this every day.

MLM: Cool.  So without fear of failure but not without fear of liability.

Peter: Fair enough… and that’s why you’re my lawyer.

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State Supreme Court Strikes Down Washington’s Anti-SLAPP Statute http://www.medialawmonitor.com/2015/07/state-supreme-court-strikes-down-washingtons-anti-slapp-statute/ Thu, 30 Jul 2015 23:30:37 +0000 http://www.medialawmonitor.com/?p=2946 By Bruce E. H. Johnson, Eric M. Stahl, and Ambika Kumar Doran

The Washington Supreme Court in May struck down that state’s 2010 anti-SLAPP statute, holding in a unanimous opinion that the law violates the state constitution’s right to a jury trial and is invalid on its face. The decision, Davis v. Cox, is the first in the nation to hold an anti-SLAPP statute unconstitutional.  — P.3d —-, 2015 WL 3413375 (Wash. 2015).

The statute, RCW 4.24.525, provided a procedure for early and efficient disposition of lawsuits targeting “public participation and petition,” including petitioning as well as speech on issues of public concern. Like statutes in California and elsewhere, the law enabled defendants facing such claims to bring an early motion to strike, requiring the plaintiff to show at the outset that the claim had merit. The law also provided for attorneys’ fees and a statutory damages award to defendants who won an anti-SLAPP motion.

Davis held that the law violates the state constitutional protection for the right to trial by jury. Specifically, the Court held that the requirement a plaintiff “establish by clear and convincing evidence a probability of prevailing on the claim” meant the trial court had to weigh and decide disputed factual evidence, which is the purview of a jury. Until Davis, every court to interpret the law held the provision was akin to a summary judgment procedure, but the Court found that to adopt that interpretation, it would have to rewrite the law. Instead, it held the law’s plain language requires a judge deciding an anti-SLAPP motion to rule on factual issues and dismiss even non-frivolous claims if they do not meet the “clear and convincing” standard. That, the court held, “creates a truncated adjudication of the merits of a plaintiff’s claim” and “invades the jury’s essential role of deciding debatable questions of fact.”

Notably, the claims in Davis did not permit plaintiffs to demand a jury trial. The plaintiffs, five members of the Olympia Food Co-op, alleged purely equitable claims, arguing the defendants—former and current members of the Co-op Board—acted ultra vires and breached their fiduciary duties when the board adopted a boycott of Israel. The trial court dismissed the claims under the anti-SLAPP statute, and the Court of Appeals affirmed, both holding the plaintiffs had failed to satisfy a summary judgment standard. The Supreme Court did not weigh in on whether summary judgment was warranted, remanding the case.

Although plaintiffs in other cases in Washington State had argued the anti-SLAPP statute is unconstitutional, Davis was the first to squarely present the issue before the state Supreme Court. Opposition to the law was spearheaded by the Washington State Association for Justice Foundation, a trade association for plaintiffs’ attorneys. The Association was joined by the American Civil Liberties Union of Washington and the Washington Employment Lawyers Association. Although the ACLU has consistently supported anti-SLAPP laws in other states, including by opposing similar constitutional challenges, the Washington chapter has taken a different position on the anti-SLAPP law and other state legislation protecting the public’s right of participation and petition—such as by supporting privacy-based exemptions to public records access, new rules making it easier to seal criminal court records, and legislation criminalizing certain ads that a court ultimately declared unconstitutional.

Amici in support of the statute included the State of Washington, the Reporters Committee for Freedom of the Press, twenty-six major news media organizations, and several organizations that support Palestinian rights.

Davis is significant because it holds the anti-SLAPP statute unconstitutional on its face, meaning it cannot apply in any circumstance. Because the basis for the decision is the state constitution, the Washington Supreme Court’s opinion is the last word, pending any future legislative fix. Media defendants and other SLAPP victims have therefore lost an important protection against baseless lawsuits targeting their First Amendment activities, at least for now.

 

DWT represented the defendants in Davis v. Cox, along with the Center for Constitutional Rights.

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The 9th Circuit Rights the Balance Between Copyright Law and the First Amendment http://www.medialawmonitor.com/2015/07/the-9th-circuit-rights-the-balance-between-copyright-law-and-the-first-amendment/ Wed, 22 Jul 2015 02:39:18 +0000 http://www.medialawmonitor.com/?p=2954 By Brendan Charney, Dan Laidman, and Kelli L. Sager

The 9th Circuit has dissolved a sweeping preliminary injunction that had ordered Google to take down copies of “Innocence of Muslims,” an anti-Islam film trailer that was linked to violent protests in the Middle East in 2012. The May 18, 2015, decision by the en banc court came nearly a year and a half after a divided panel ordered the video removed while a performer’s copyright claim worked its way through the courts.

The novel application of copyright law to suppress a newsworthy video drew protests from media organizations, a number of whom expressed concerns in an amicus brief that the original panel’s expansive interpretation of injunctive relief under copyright law could allow disgruntled subjects of news coverage to block unflattering articles or broadcasts while evading traditional First Amendment protections. In vacating the injunction, the court majority agreed with a central premise of the media amicus brief, writing that the “panel’s takedown order of a film of substantial interest to the public is a classic prior restraint of speech.” Noting that a “weak copyright claim cannot justify censorship in the guise of authorship,” the court held that such takedown orders must meet a heavy burden to justify the restriction on speech.

“INNOCENCE OF MUSLIMS” AND AN INTERNATIONAL CONTROVERSY

“Innocence of Muslims” depicts the prophet of Islam as, among other things, a pedophile and murderer. After the crude film was posted on YouTube and translated into Arabic, it caused outrage in the Middle East and was cited as the cause of violent protests, including the September 11, 2012, attack on the U.S. Consulate in Benghazi (which resulted in the death of U.S. Ambassador Christopher Stevens). After the 2012 attack, officials in President Obama’s administration referred to the possibility that the film had spontaneously instigated the attack, but others disagreed, arguing that the attack was a planned act of terrorism that the United States should have anticipated.

An Egyptian cleric later issued a fatwa against anyone associated with the film. Following the fatwa, Cindy Lee Garcia, an actress in the film, sought to enjoin Google (which owns YouTube) from hosting the film. Garcia alleged that she had been told her performance would appear in a desert adventure story and she read innocuous lines given to her by the film’s director, Mark Basseley Youssef. Youssef allegedly dubbed in different lines later to make it appear that Garcia’s character was accusing the prophet of being a child molester.

Garcia sued Google and Youssef in California state court, seeking to enjoin further distribution of the film based on claims sounding in privacy. After the state court suit was quickly dismissed, Garcia brought a copyright action against Google in federal court. In the federal action, she claimed a copyright interest in her five-second performance, complained that Google had not responded to her takedown requests, and argued that continued public availability of the film was likely to cause her irreparable harm, including possibly death.

THE SECRET PRELIMINARY INJUNCTION AND GAG ORDER

The district court denied the preliminary injunction, but a divided panel of the 9th Circuit reversed. The panel majority granted the injunction, requiring Google to take down all copies of the film featuring Garcia. (The panel initially issued its order in secret, prohibiting Google from telling the public about the takedown, or the court’s order, until the panel filed its opinion a week later.)

Then-Chief Judge Alex Kozinski authored the panel majority’s decision, holding that Garcia was likely to succeed on the merits because her performance was itself copyrightable under the “minimal creativity” standard set out in Feist Publications, Inc., v. Rural Telephone Service Co., 499 U.S. 340 (1991). The majority found that Garcia possessed all rights to her performance because it had not been shown that 1) she contributed her performance within the scope of employment, 2) she had executed a work-made-for-hire agreement, or 3) she had granted Youssef an implied license to use her performance (given that Youssef used dubbing to change the content of her lines without her consent). The panel majority also found that irreparable harm would likely result from the alleged infringement because Youssef’s posting of Garcia’s performance caused Garcia to receive credible death threats.

The majority rejected Google’s argument that the public interest favored continued access to newsworthy materials, stating that “the First Amendment doesn’t protect copyright infringement.”  Judge N. Randy Smith dissented, disagreeing with the majority’s substantive analysis of the copyright claim and also suggesting that the injunction was an impermissible prior restraint.

A wide array of news organizations, filmmakers, Internet companies, academics, and free speech advocacy groups filed amicus briefs supporting Google’s request for rehearing. Some argued that the court’s reasoning would drastically expand the number of people who could assert a copyright over a work and would allow any of these new copyright “owners” to assert a shaky copyright claim as a basis for forcing the takedown of expressive works, including news coverage. Some amici argued that this novel theory of copyright—making claims available to any person who contributed “minimal creativity” to an expressive work, without even considering the First Amendment—could provide an end-run around speech protections that limit prior restraints in other contexts, such as in defamation or privacy torts. Others warned that the ruling could encourage would-be censors to use threats as a sort of “heckler’s veto” to encourage the suppression of works with which they disagree.

The 9th Circuit agreed in November 2014 to rehear the case en banc. But the court denied Google’s request to stay the panel’s ruling. Consequently, Google remained subject to the takedown order for nearly 15 months, until the issuance of the en banc opinion.

THE EN BANC DECISION

The 9th Circuit ultimately vacated the injunction in a 10–1 decision written by Judge M. Margaret McKeown, with Judge Kozinski the only dissenter. The en banc opinion noted Garcia’s “heartfelt plea for personal protection,” but held that copyright law and First Amendment principles foreclosed her request for a preliminary injunction.

“A Classic Prior Restraint”

The court determined that the takedown order “gave short shrift to the First Amendment values at stake.”  It rejected the nostrum that “the First Amendment doesn’t protect copyright infringement,” and clarified that copyright law “is not categorically immune from challenges under the First Amendment,” citing the Supreme Court’s decision in Eldred v. Ashcroft, 537 U.S. 186 (2003). Accordingly, the en banc decision confirmed the takedown order was “a classic prior restraint of speech” and held that the “heavy presumption” against such restraints simply could not be overcome with such a thin copyright claim, especially given that the film was “controversial and politically significant.”

Takedown Orders Are Mandatory Injunctions

The en banc court’s analysis of the four-factor preliminary-injunction test likely will help creators and distributors avoid takedowns of expressive works in questionable cases. The opinion confirms that takedown orders are mandatory injunctions that are subject to a heightened showing of likelihood of success. Although the panel majority had required Garcia to show only that she was likely to succeed on the merits of her copyright claim, the en banc court held that, because the takedown order required Google to take affirmative action—“to remove (and to keep removing) Innocence of Muslims from YouTube”—it was a mandatory injunction. Accordingly, Garcia had to show that the law and facts “clearly favor” her position—a difficult task in the context of a novel theory of copyright.

No “Copyright of Thousands”

On the facts presented, the en banc court held that Garcia could not show that the law “clearly favor[ed]” her position; instead, the court held that Garcia’s theory of copyright ownership would undermine the purpose of the Copyright Act by splintering copyright ownership among thousands of contributors. (Judge Watford argued in a concurrence that the court should have decided the case on narrower grounds.)

The en banc court zeroed in on the key issue raised by Garcia’s copyright theory:  whether a contributor’s performance can be considered a copyrighted work that is separate from the work in which it is contained. The court answered in the negative, drawing on guidance from the Copyright Office and its prior decision in Aalmuhammed v. Lee, 202 F.3d 1227 (9th Cir. 2000). The en banc court’s reasoning focused on the threat that Garcia’s theory would “fragment copyright protection” for integrated works, and raise the specter of a “copyright cherry-picking” whereby “any contributor from a costume designer down to an extra…[would be enabled] to claim copyright in random bits and pieces of a unitary motion picture without satisfying the requirements of the Copyright Act.”  Thus, a “cast of thousands” in an ambitious film would yield a “copyright of thousands.” The court also noted that under Garcia’s theory, “filming group scenes, like a public parade, or the 1963 March on Washington, would pose a huge burden if each of the thousands of marchers could claim an independent copyright”—a point raised by media organizations in their amicus brief.

Copyright Law Is “Meant To Foster Rather Than Repress Free Expression”

The en banc court also was concerned that Garcia’s theory would empower plaintiffs to use copyright as a tool of censorship, an outcome it found particularly undesirable given that copyright was actually meant to encourage creation and distribution of expressive works.

Given that Garcia faced credible death threats from religious extremists, the court wrote that “at first blush, irreparable harm looks like Garcia’s strongest argument.” But the court noted that, for purposes of a preliminary injunction, an alleged “irreparable” harm is only relevant if it affects a legal interest protected by the movant’s cause(s) of action. Thus, when a preliminary injunction is sought based solely on a claim of copyright, the movant must show irreparable harm to the movant’s “interests as an author.”

To determine the contours of Garcia’s “interests as an author,” the court considered the Copyright Act’s purpose, and held that copyright law is “meant to foster rather than repress free expression.” As the Supreme Court noted in Harper & Row Publishers, Inc., v. Nation Enterprises, 471 U.S. 439 (1985), copyright “supplies the economic incentive to create and disseminate ideas.” In other words, copyright does not protect personal safety or dignitary interests, and therefore, harm to those interests cannot justify taking down copyrighted material.

“Ultimately,” the Court observed, “Garcia would like to have her connection to the film forgotten and stripped away from YouTube. Unfortunately for Garcia, such a ‘right to be forgotten,’ although recently affirmed by the Court of Justice for the European Union, is not recognized by the United States.” This statement should come as no surprise to American speech advocates, but reaffirms the principle that copyright cannot be used to conceal or restrain public facts.

At the same time the en banc opinion was issued, Judge Stephen Reinhardt filed a separate opinion dissenting from the Court’s decision in March 2014 not to rehear the denial of Google’s request for a stay of the takedown order. Judge Reinhardt expressed dismay that “our court allowed an infringement of First Amendment rights to remain in effect for 15 months before we finally issued our opinion dissolving the unconstitutional injunction issued by a divided three-judge panel.” Noting that the film’s role in the Benghazi attack has been the subject of congressional hearings, Judge Reinhardt stated that the panel’s order “condoned censorship of political speech of the highest First Amendment magnitude.”

CONCLUSION

After 15 months, several rounds of briefing, and 13 separate amicus briefs, the 9th Circuit dissolved a prior restraint that had restricted access to a politically significant film at the center of world-historical events. This victory is worth celebrating, and the court’s reasoning will forestall future attempts to restrain expressive works based on thin copyright claims. It is also worth noting the role that amici played in this victory: the court majority expressly thanked the 13 amici who submitted briefs, specifically mentioning several groups. The court’s reasoning also reflected arguments made by some of the amici, which reaffirms the importance of weighing in on important constitutional cases.

As Judge Reinhardt points out, however, this victory nonetheless is bittersweet, given the lengthy period of time in which the public was denied regular access to a film bound up in world events and news organizations and commentators were prevented from featuring the film directly in their coverage of these events. Hopefully the outcome of this case, and the strong opinion issued by Judge Reinhardt, will persuade other courts to reject heckler’s vetoes, and to subject all takedown orders to the most exacting First Amendment scrutiny.

Davis Wright Tremaine LLP attorneys Kelli L. Sager, Dan Laidman, and Brendan Charney represented Amici Curiae Los Angeles Times Communications LLC; The E.W. Scripps Company; Advance Publications, Inc.; The New York Times Company; The Washington Post; the Reporters Committee for Freedom of the Press; National Public Radio, Inc.; the National Press Photographers Association; the California Newspaper Publishers Association; and the First Amendment Coalition in this matter.

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Elonis v. United States: So What’s a True Threat? http://www.medialawmonitor.com/2015/07/elonis-v-united-states-so-whats-a-true-threat/ Tue, 21 Jul 2015 02:36:16 +0000 http://www.medialawmonitor.com/?p=2950 By Diana Palacios

The Supreme Court has skirted a difficult question once again, leaving everyone to wonder what constitutes a “true threat” under the First Amendment. In Elonis v. United States, 575 U.S. ___ (2015), the Court held that a person cannot be convicted of communicating threats simply because a reasonable person would view the statements as threatening. The majority opinion, authored by Chief Justice Roberts, was grounded in basic criminal-law principles and avoided the larger First Amendment issues presented in the case.

After his wife left him and took the children, Anthony Elonis began posting on Facebook rap lyrics with violent and graphic language that threatened his wife, co-workers, an FBI agent, and a local school. Elonis was convicted under a federal statute that makes it a crime to communicate “any threat to injure the person of another,” 18 U.S.C. § 875(c). The statute, however, does not specify any requisite mental state. Elonis argued that statutory construction and the First Amendment required the government to prove that he intended his statements to be a threat. During the trial, the district court rejected Elonis’ arguments and instructed the jury to consider whether a “reasonable person” would regard Elonis’ statements as threats. The 3rd Circuit affirmed.

The Supreme Court reversed, holding that the reasonable person standard is insufficient and “inconsistent with ‘the conventional requirement for criminal conduct— awareness of some wrongdoing.’” To be convicted of communicating a threat, the Supreme Court explained, the defendant must have a guilty mental state; however, the Court stopped short of specifying whether a defendant had to intend for a statement to be a threat or whether recklessness would suffice. In a concurring opinion, Justice Alito contended that recklessness is sufficient, while Justice Thomas, as the sole dissenter, would have preferred a reasonable person standard.

But the majority opinion did not address the larger constitutional issue of whether the First Amendment requires a showing of subjective intent to threaten in order to constitute a “true threat”—a category of speech unprotected by the First Amendment. Indeed, the Supreme Court has provided little guidance on this issue. The last time the Supreme Court applied the true threat doctrine was in Virginia v. Black, 538 U. S. 343, 359 (2003), where the Court defined true threats as “statements where the speaker means to communicate a serious expression of an intent to commit an act of unlawful violence to a particular individual or group of individuals.” Since Black, courts have split on whether the First Amendment requires proof of a person’s subjective intent to threaten, as required by the 9th Circuit, or whether a reasonable person standard is sufficient, as required by most circuits that have addressed this question.

Although the majority did not address the First Amendment issue, Justice Alito and Justice Thomas did. In line with his views on statutory construction, Justice Alito explained that recklessness would be sufficient under the First Amendment because it would provide “adequate breathing space” for protected speech. Justice Thomas traced the history of true threats and concluded that the First Amendment does not require any heightened mental state; if it did, Justice Thomas explained, true threats would be “one of the most protected categories of unprotected speech.” Neither Justice Alito nor Justice Thomas gave much credence to the concern that the true threats doctrine could be used to chill protected speech.

Ultimately, Elonis is far more notable for what it did not hold. With the widespread use of social media, what constitutes a true threat online remains an open question—and will continue to be a widely debated issue that the Supreme Court may eventually have to resolve.

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Wake-Up Call: 2nd Circuit Declares NSA’s Mass Telephone Surveillance Program Illegal, Then Weighs Whether Claims are Moot in Light of Later Development http://www.medialawmonitor.com/2015/06/wake-up-call-2nd-circuit-declares-nsas-mass-telephone-surveillance-program-illegal-then-weighs-whether-claims-are-moot-in-light-of-later-development/ Sat, 06 Jun 2015 03:23:25 +0000 http://www.medialawmonitor.com/?p=2968 By Lance Koonce and Bryan Thompson

Whatever your opinion of Edward Snowden, the shockwaves from his leaks of classified material have continued to roil all three branches of the federal government. The latest wave broke on May 7, 2015, when the United States Court of Appeals for the 2nd Circuit held in ACLU v. Clapper that the National Security Agency’s mass telephone metadata collection program, which had been in place for a decade or more, was not authorized by Section 215 of the Patriot Act and was therefore illegal. Public awareness of that program had come to light in June 2013 when The Guardian newspaper published a leaked order from the Foreign Intelligence Surveillance Court (FISC) requiring Verizon to produce to the NSA “on an ongoing daily basis … all call detail records or ‘telephony metadata’ created by Verizon for communications (i) between the United States and abroad; or (ii) wholly within the United States, including local telephone calls.” It subsequently became clear that such FISC orders have been issued to virtually all major telephone carriers in the United States.

This was arguably the most significant ruling to date on the various surveillance programs revealed by Snowden and the only appellate court ruling on Section 215, which at the time of the ruling was set to expire on June 1, 2015. In light of the pending expiration, lawmakers had begun intensely debating whether the program should be continued, modified, or ended. Some members of Congress pushed for a clean reauthorization, while the Obama Administration defended the program, but also called for the end of bulk collection, advancing an alternative mechanism that would require the carriers themselves to maintain the data until the government requests it.

The 2nd Circuit’s May 7 decision is remarkable for its strong criticism of the breadth of the data collection program, the government’s efforts to justify that breadth by unpersuasive comparison to ordinary search warrants and subpoenas, and the government’s strained argument that information about every phone call is “relevant” to an authorized investigation. The court would not countenance stretching the concept of relevance so far, as Section 215 requires:

If the orders challenged by appellants do not require the collection of metadata regarding every telephone call made or received in the United States (a point asserted by appellants and at least nominally contested by the government), they appear to come very close to doing so. The sheer volume of information sought is staggering; while search warrants and subpoenas for business records may encompass large volumes of paper documents or electronic data, the most expansive of such evidentiary demands are dwarfed by the volume of records obtained pursuant to the orders in question here.

On June 2, 2015, one day after Section 215’s sunset provisions were triggered, Congress passed the USA Freedom Act, which was subsequently signed into law by President Obama. The legislation strikes a middle ground, amending Section 215 to temporarily reauthorize the surveillance program for a 180-day period, but then prohibiting future large-scale bulk collection of call detail records after November 29.

Given the important revisions that the USA Freedom Act made to Section 215, the 2nd Circuit directed both parties on June 9 to brief whether the changes to Section 215 prohibiting future bulk collection of telephone metadata moots any of the appellants’ claims. Meanwhile, the Foreign Intelligence Surveillance Court issued an order on June 29 permitting the government to resume metadata collection during the 180-day reauthorization period.

The 2nd Circuit is currently weighing the arguments in the parties’ response briefs, which were due on July 27. We will have to wait to see whether the 2nd Circuit will find that the USA Freedom Act’s future termination of the bulk collection program renders the ACLU’s claims moot or warrants further judicial action. In its response brief, the government stated that the definite termination of the bulk collection program on November 29, coupled with the NSA’s decision to sequester and later destroy all collected metadata, will moot the ACLU’s claims, and asked the court to respect the compromise worked out between Congress and the President. It may be some time before the ultimate disposition of this case; in the meantime, it is unclear to what extent this ruling or the USA Freedom Act could affect telephone carriers’ immunity when providing information to the government pursuant to National Security Letters (“NSLs”) and FISC orders. However, there are several other cases challenging the legitimacy of the mass data collection program under appellate review in other jurisdictions that may give more specific guidance on this topic, and the courts considering them will undoubtedly take account of the 2nd Circuit’s decision, which is summarized below, along with a brief discussion of the current status of the case.

The NSA Bulk Metadata Collection Program

Launched sometime after the September 11, 2001, terrorist attacks, the NSA’s mass telephone metadata collection program is implemented through orders issued by the Foreign Intelligence Surveillance Court, upon application from the NSA. As presently constituted, Section 215 of the Patriot Act permits the government “to make an application for an order requiring the production of any tangible things … for an investigation to obtain foreign intelligence information not concerning a United States person or to protect against international terrorism or clandestine intelligence activities.” The government’s application must include “a statement of facts showing that there are reasonable grounds to believe that the tangible things sought are relevant to an authorized investigation (other than a threat assessment) conducted in accordance with subsection (a)(2) of this section to obtain foreign intelligence information not concerning a United States person or to protect against international terrorism or clandestine intelligence activities.” The review of such applications by FISC is conducted in secret, typically in ex parte proceedings.

The order to Verizon—and presumably every similar order addressed to other providers—required the ongoing production of telephone metadata, which was then to be stored on a secure NSA network indefinitely. The court noted that under the program, the metadata “would only be accessed ‘when NSA has identified a known telephone number for which … there are facts giving rise to a reasonable, articulable suspicion that the telephone number is associated with [Redacted]’– presumably, with terrorist activity or a specific terrorist organization.” As set forth specifically in a “Secondary Order,” the metadata collected included “comprehensive communications routing information, including but not limited to session identifying information (e.g., originating and terminating telephone number, International Mobile Subscriber Identity number, International Mobile station Equipment Identity number, etc.), trunk identifier, telephone calling card numbers, and time and duration of call.”

 The District Court Decision

The American Civil Liberties Union, American Civil Liberties Union Foundation, New York Civil Liberties Union and New York Civil Liberties Union Foundation filed the instant case in the United States District Court for the Southern District of New York, challenging the NSA’s metadata program on the grounds that it was beyond the scope of Section 215 of the Patriot Act, and that it violated the First and Fourth Amendments. In the district court, Judge William H. Pauley granted the government’s motion to dismiss, finding that Section 215 impliedly precludes judicial review, that the statutory claims were meritless, and that the statute does not violate the Constitution.

 The 2nd Circuit Opinion

 Standing and Preclusion

First, the 2nd Circuit affirmed the district court’s ruling that the appellants had standing to support their action against the NSA’s metadata program, finding that they alleged concrete, traceable, and redressible injuries. Specifically with regard to appellants’ Fourth Amendment claim, the court found that the FISC orders permitting the government to collect virtually all telephone metadata demonstrated that the appellants’ records are collected as part of the NSA’s program and that the appellants’ claim alleges injury from the very collection of their metadata. The court found that such collection was more appropriately challenged as a seizure under the Fourth Amendment, rather than as a search, and accordingly held that “whether or not such claims prevail on the merits, appellants surely have standing to allege injury from the collection and maintenance … of records relating to them.”

Significantly, in addition to finding that collection alone is a seizure and confers standing, the court noted that even on the government’s theory—that no search (and therefore no harm) occurred unless a particular record was singled out for scrutiny—it was clear that any actual review of collected data by a human being would constitute a search and confer standing. The court held that the computerized review the government described was no different:

Finally, the government admits that, when it queries its database, its computers search all of the material stored in the database in order to identify records that match the search term. In doing so, it necessarily searches appellants’ records electronically, even if such a search does not return appellants’ records for close review by a human agent. … That the search is conducted by a machine might lessen the intrusion, but does not deprive appellants of standing to object to the collection and review of their data.

Next, the court addressed the government’s contention that the plaintiffs were impliedly precluded from bringing suit, in particular because Section 215 provides only for judicial review by FISC and a “specialized mechanism for appellate review,” and anticipates challenges only from the communications companies that have actually received Section 215 orders (not the targets of the orders). Rejecting this argument, the court noted the strong presumption in favor of judicial review deriving from the Administrative Procedure Act (APA), requiring the government to show “clear and convincing” or “fairly discernible” evidence that Congress intended preclusion. The government argued that the extensive secrecy requirements surrounding the limited judicial review provided by statute indicated that Congress intended not to permit any other judicial review. But the court disagreed:

Indeed, the government’s argument from secrecy suggests that Congress did not contemplate a situation in which targets of § 215 orders would become aware of those orders on anything resembling the scale that they now have. That revelation, of course, came to pass only because of an unprecedented leak of classified information. That Congress may not have anticipated that individuals like appellants, whose communications were targeted by § 215 orders, would become aware of the orders, and thus be in a position to seek judicial review, is not evidence that Congress affirmatively decided to revoke the right to judicial review otherwise provided by the APA in the event the orders were publicly revealed.

The court also rejected the government’s arguments that the statutory scheme as a whole, legislative history, and the language of other statutes favored preclusion, summing up its arguments as follows: “In short, the government relies on bits and shards of inapplicable statutes, inconclusive legislative history, and inferences from silence in an effort to find an implied revocation of the APA’s authorization of challenges to government actions.”

 Illegality Under Section 215

Turning to what it saw as the heart of the matter, the court first noted that Section 215 allows the government to seek “an order requiring the production of any tangible things … for an investigation … to protect against international terrorism or clandestine intelligence activities,” including anything that “can be obtained with a subpoena duces tecum issued by a court of the United States in aid of a grand jury investigation” or any other court order. While this is broad language, the court noted that the government must also submit a fact statement demonstrating reasonable grounds to believe “that the tangible things sought are relevant to an authorized investigation (other than a threat assessment) conducted [under guidelines approved by the Attorney General].” In plain English, this meant that “the basic requirements for metadata collection under § 215, then, are simply that the records be relevant to an authorized investigation (other than a threat assessment).”

The court’s decision on the legality of the FISC orders under Section 215 turned on the definition of “relevance.” The court pointed out that the parties were not even really debating whether the data being collected were “relevant to any particular inquiry.” There was no comparison to the scope of traditional subpoenas or court orders because such mass data collection is something different—the government argued that the relevance of bulk aggregation of metadata comes instead from “the ‘creation of a historical repository of information’” that can be queried by “’certain analytic techniques’” in future terrorism investigations. The court concluded that the government’s definition would render the word “relevant” virtually meaningless because, by that reasoning, all telephone metadata in the United States, at all times, would be “relevant to terrorism investigations”:

Thus, the government takes the position that the metadata collected—a vast amount of which does not contain directly “relevant” information, as the government concedes—are nevertheless “relevant” because they may allow the NSA, at some unknown time in the future, utilizing its ability to sift through the trove of irrelevant data it has collected up to that point, to identify information that is relevant. We agree with appellants that such an expansive concept of “relevance” is unprecedented and unwarranted.

To the extent the government did point to prior decisions examining the breadth of subpoenas, the court found that “as broad as those subpoenas were, the cases cited by the government only highlight the difference between the investigative demands at issue in those cases and the ones at issue here.” Notably, in all such prior cases, the subpoenas were limited by the context of the investigation itself, or temporally. By contrast, the court held,

The telephone metadata program requires that the phone companies turn over records on an “ongoing daily basis”—with no foreseeable end point, no requirement of relevance to any particular set of facts, and no limitations as to subject matter or individuals covered.”

Indeed, such a broad reading of “relevant” ignored the statutory limitation of such orders “to an authorized investigation.” The government’s argument implied that there is “only one enormous ‘anti‐terrorism’ investigation and that any records that might ever be of use in developing any aspect of that investigation are relevant to the overall counterterrorism effort.” Finding that the government’s interpretation of the statute “defies any limiting principle,” the court held that the surveillance far exceeded the statutory scope.

The court also found that the government’s interpretation read the phrase “other than a threat assessment” out of the statute. The FBI’s own guidelines, the court noted, differentiate assessments from investigations because “they may be initiated without any factual predication.” The objective of an assessment may be broad—for instance, prevention of “terrorist acts against the nation”—but must still be clearly defined and serve an authorized purpose. When conducting assessments, the court further noted, the FBI typically limits itself to methods with “low intrusiveness,” such as collecting public information and reviewing government records. Given these distinctions, it was clear that Congress intended “to prevent § 215 orders from being issued where the FBI, without any particular, defined information that would permit the initiation of even a preliminary investigation, sought to conduct an inquiry in order to identify a potential threat in advance.” The metadata collection program was “even more remote from a concrete investigation” than such threat assessments.

 Constitutional Challenges

While the 2nd Circuit chose not to address the appellants’ First Amendment claim, it discussed at length the argument that the metadata collection program violated appellants’ expectations of privacy under the Fourth Amendment. The district court rejected appellants’ Fourth Amendment claim on the grounds that the Supreme Court has held that an individual has no privacy interest in telephone records or other information voluntarily disclosed to a third party. Appellants argued that technological advances in surveillance such as the metadata program gave cause to revisit this third-party records doctrine.

The court acknowledged that appellants’ claim raised the “vexing” question of how modern technology is altering traditional privacy expectations, an issue that has thrown Fourth Amendment jurisprudence into “some turmoil” in recent years. In its analysis of appellants’ Fourth Amendment claim, the 2nd Circuit highlighted Justice Sotomayor’s concurrence in United States v. Jones, which questioned whether the realities of the digital age—“in which people reveal a great deal of information about themselves to third parties in the course of carrying out mundane tasks”—call for us to reevaluate the notion that we have no reasonable privacy expectation in information like telephone metadata that we must disclose to third parties to live in the modern world.

Despite its pondering, however, the court did not resolve these difficult issues. Because the court already held that the NSA’s program was not authorized by Section 215, and because Congress might make the appellants’ constitutional claims moot by revising Section 215 or letting it expire on June 1, the court decided that “we need not and do not reach these weighty constitutional issues.” Instead, the 2nd Circuit suggested that courts should defer to Congress, which can apply its experience and judgment and reflect the will of the electorate to define the contours of privacy under the Fourth Amendment in an evolving technological and social landscape. Finally, the court noted that several bills to revise Section 215 were pending before Congress, and that “[t]he constitutional issues [involved] are sufficiently daunting to remind us of the primary role that should be played by our elected representatives.”

 Injunctive Relief/Remand

Although the court determined that the district court erred in dismissing the appellants’ claims and that “appellants have shown a likelihood—indeed, a certainty—of success on the merits of at least their statutory claims,” it declined to decide whether a preliminary injunction is required. Instead, the court demurred and chose to remand the issue to the district court.

Echoing its analysis of appellants’ constitutional claims, the court noted that the program’s sunset provisions would take effect in a few weeks’ time without congressional action; should Congress allow Section 215 to lapse, appellants’ injunction consequently would be moot. In the court’s view, given the government’s asserted national security interests in the program, and the importance of Congress’ role in deciding whether to reauthorize Section 215, “we deem it prudent to pause to allow an opportunity for debate in Congress that may (or may not) profoundly alter the legal landscape.” As discussed below, this is precisely what occurred.

2nd Circuit to Consider Whether New Law Renders ACLU’s Claims Moot

The court’s prudent pause allowed Congress to drastically revamp Section 215, but to what extent the new law altered the legal landscape is unclear, at least in the short term. At the heart of the question is the fact that Section 103 of the new USA Freedom Act prohibits bulk collection of business records and other “tangible things”—including call detail records—by requiring FISC orders approving production to use “specific selection terms” as the basis for production. Section 101 requires that the FBI must also use specific selection terms as the basis for a production request, and mandates judicial oversight of production orders.

Perhaps critical to the appellants’ claims, Section 109 delayed the effect of these changes for 180 days until November 29. In its order temporarily reviving the government’s bulk metadata collection program, FISC looked to Section 109 and legislative history to hold that Congress intended to prohibit the bulk collection of data only after the 180-day period ended. Looking beyond the mere text of the new law, FISC also took pains to note its disagreement with the 2nd Circuit’s analysis, and concluded that the 2nd Circuit’s conclusions were nevertheless superseded by the USA Freedom Act.

The parties’ response briefs to the 2nd Circuit paint drastically different pictures on just how the new law affected the appellants’ claims. Not much has changed, according to the ACLU brief, as the government “continues to collect call records in bulk … based on the same statutory language the Court has already held does not permit it” and “apparently intends to retain and use the fruits of its unlawful surveillance indefinitely.” Looking to reach the finish line quickly, the ACLU also used the bulk of its response brief to petition the 2nd Circuit for a preliminary injunction against the revived collection program.

Conceding that appellants’ claims are not currently moot, the government’s response brief emphasized that the appellants will not have a cognizable claim once the program permanently ceases on November 29. The government also argued that the ACLU’s claim for a purge of collected data will also be moot, as the Office of the Director of National Intelligence recently announced that the NSA will sequester and no longer use or access metadata already collected after November 29. Instead, the NSA will retain the data for an additional three months for “data integrity purposes” and will delete all metadata as soon as possible after all pending civil actions are resolved. As the bases for appellants’ claims will expire in short order, the government asked the 2nd Circuit to respect the legislative compromise embodied in the USA Freedom Act and hold that the appellants are not entitled to any relief.

How the 2nd Circuit will divine the effect of the new law on the appellants’ remaining claims, and whether its decision will come before the lapse of the reauthorization period, is currently unclear. But needless to say, the 180-day transition period built into the USA Freedom Act, combined with its prior deference to the congressional process and FISC’s recent order criticizing the circuit court’s prior ruling, will weigh heavily in the 2nd Circuit’s deliberations.

How Will the USA Freedom Act Impact Provider Immunity?

Telephone carriers and other providers have likely been watching the events unfolding in the 2nd Circuit and Congress, wondering how any judicial decision or legislative action may affect their immunity when they are asked to comply with an NSL or FISC order. Providers fortunately received a reprieve under the USA Freedom Act’s Section 105, which extends liability protection to entities that produce tangible things or provide information, facilities or technical assistance in complying with an order. Regardless of how the 2nd Circuit rules, providers should enjoy protection from liability for complying with government requests for information, both under the temporarily authorized bulk collection program and the more limited methods permitted by the USA Freedom Act after November 29.

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Landmark Open Internet Order Released by FCC http://www.medialawmonitor.com/2015/06/landmark-open-internet-order-released-by-fcc/ Wed, 03 Jun 2015 02:50:36 +0000 http://www.medialawmonitor.com/?p=2960 By Christopher Savage, Paul Glist, Wesley Heppler, K.C. Halm, and T. Scott Thompson

On February 26, 2015, the FCC voted to approve new Open Internet (or Net Neutrality) rules (on a 3-2 party line vote).  The FCC released the full Order explaining the details of the new rules on March 12, 2015.  Most of the new rules took effect on June 12, 2015, but the FCC’s new, expanded obligations on ISPs to disclose their terms service, network management practices, etc., have not yet taken effect, pending approval by the Office of Management and Budget.

In addition to explaining the majority’s actions and reasoning, the Order contains lengthy and vigorous dissents from Commissioners Pai and O’Rielly.

We summarized the FCC’s key actions in an advisory based on an early release by Chairman Wheeler and a subsequent advisory following the Commission’s vote. The Order confirms that the FCC’s main regulatory actions are as follows:

  • It changes the regulatory classification of broadband Internet access service both fixed and mobile, from an “information service” to a Title II “telecommunications service.”
  • It “forbears” from applying the vast majority of traditional Title II requirements, although the true scope and ultimate effectiveness of this forbearance is in dispute. Taking the agency at face value, however, it forbears from (among other things): ex ante rate regulation; tariff filing and related requirements; network unbundling requirements; and any obligation on providers to contribute to the universal service fund—although the agency has signaled that such contributions may be required in the future. However, the agency holds that the “core” Title II provisions—Section 201 (generally requiring terms of service to be just and reasonable) and Section 202 (generally banning unreasonable discrimination)—do apply to broadband.
  • It imposes three “bright line” rules—no blocking, no throttling, and no paid prioritization—and a general rule barring unreasonable interference with/disadvantaging of (a) end users’ ability to access lawful content or to use non-harmful devices in connection with the service, and (b) edge providers’ ability to disseminate content.
  • It defines broadband Internet access service to include interconnection arrangements between a broadband provider and other networks and asserts authority to review disputes regarding such arrangements on a case-by-case basis.
  • Except for the ban on paid prioritization, the rules permit a provider to engage in “reasonable network management,” defined to include technical aspects of running a network, but to exclude actions taken for “business” purposes. The rule against paid prioritization indicates that waivers might be available, but the discussion in the Order itself indicates that the bar for obtaining such a waiver is quite high.
  • The FCC imposes more detailed and onerous disclosure (“transparency”) requirements on broadband providers, but temporarily exempts providers with fewer than 100,000 subscribers from those more detailed requirements; as noted above, these new requirements have not yet taken effect.
  • It concludes that data services that do not provide end users with access to the Internet (such as interconnected VoIP and certain IP video services) are not subject to its new rules. Instead, these services (referred to as “specialized services” in the former rules) will be subject to monitoring and additional disclosures to ensure that they do not degrade broadband quality.
  • It modifies its enforcement/complaint procedures to permit the Enforcement Bureau to seek written input from outside technical bodies to assist in resolving claims that the rules have been violated, and also permits the Enforcement Bureau to issue advisory opinions about possible future conduct.

There are a number of significant impacts from the FCC’s ruling. That said, with one major exception—the extension of active FCC regulatory oversight of interconnection between broadband providers and other networks—the new rules directly governing the provision of broadband may fairly be viewed as an update (albeit, in the case of transparency/disclosure, a substantial one) of its earlier rules from 2010, with a specific process by which the Commission could render ad hoc judgments on broadband rates, terms and conditions.

Numerous parties have challenged the FCC’s new rules in federal appeals court; as of late July, parties opposing the FCC’s action have filed their opening brief, challenging the FCC’s decision to classify wired and wireless broadband Internet access as a Title II “telecommunciations service,” along with a number of related claims.

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Taming the “Wild West” in the Far East http://www.medialawmonitor.com/2015/03/taming-the-wild-west-in-the-far-east-3/ Sun, 22 Mar 2015 20:47:03 +0000 http://www.medialawmonitor.com/?p=2905 China Extends Protections for Privacy and Reputation to the Internet, Heightens the Risk of Lawsuits Against Online Publishers

By Jim Rosenfeld, Vincent Wang, Ambika Doran, and Alan Huang

Although laws targeting Internet-based content have lagged behind in China, the Chinese government has made sweeping changes over the past two years—most recently last fall—that extend offline legal protections to the virtual world.  These developments will require online publishers to change their practices and possibly face greater exposure to privacy and reputational claims.

The changes began in December 2012, when the Chinese government issued the Decision to Enhance the Protection of Information on the Internet (the “Decision”), the principal document outlining privacy and reputational rights online in China.  The Decision protects personally identifiable and other private electronic information, requires Internet service providers (“ISPs”) to follow certain protocols when collecting and using electronic information, and places primary responsibility on ISPs if such information is compromised.

The Decision does not define specific violations or enforcement mechanisms, but directs the Supreme People’s Court (“SPC”) and the Supreme People’s Procuratorate (“SPS”), China’s highest court and prosecutorial office, respectively, to do so.  As a result, the SPC and SPS in September 2013 issued the Interpretation of Criminal Liability for Libel on the Internet, and the SPC in October 2014 distributed Rules Concerning Several Issues of the Application of Law in Civil Dispute Cases Where Personal Rights and Interests Are Harmed by Use of the Internet (“Rules”).  Together, these documents outline a new regime for policing violations of privacy and reputation rights on the Internet in China.  Eight changes are worth noting:

1. Rules defining jurisdiction for online violations

The Rules clarify the correct venue for alleged online violations of personal rights: the defendant’s residence or the location of the violation.  The latter, in turn, is the location of the terminal (whether a computer or mobile device) that sends the harmful content.  Notably, this raises—but does not appear to resolve—the question how the Rules apply to foreign defendants who publish content abroad.

2. Procedures making it easier to sue ISPs

The Rules accomplish this in two ways.  First, they allow an ISP to be a defendant if the plaintiff sues it directly or an ISP customer who is sued requests the ISP be added as a co-defendant.  Second, an ISP cannot easily defend itself by arguing the allegedly harmful information was released by an unidentifiable customer.  Instead, it must identify the customer to add that customer as a codefendant.

3. Revised DMCA-like safe harbor

Before the Rules, China already had a safe harbor similar to the Digital Millennium Copyright Act, 17 U.S.C. § 512(c).  Under that rule, an ISP could avoid suit altogether by following a protocol: remove content upon notification it is infringing and notify the poster, and restore the content if the poster disputes the claim.  The poster and claimant would then resolve their dispute in court without further involvement of the ISP (unless there was proof the ISP itself knew about the infringement).

A revised rule makes it more likely an ISP will be dragged into court.  Now the ISP is immune from liability but not suit, and must prove two elements to be dismissed from suit: (1) it “timely” removed the disputed content and (2) it had no basis to know the content was infringing.  Each of these, in turn, is decided according to a set of factors established by the Rules that may involve fact-intensive, time-consuming, and expensive inquiries.

4. Liability for reposting content

The Rules also create a test to decide liability for reposting third-party content, which requires looking at the duty of care owed by the reposter (public figures have a greater duty than others), whether the information appears to be harmful, and whether the reposter changes the information to make it untruthful or misleading.

5. New violation: Black PR

The Rules make it unlawful to engage in “Black PR,” the practice of purposefully posting online negative information about a company, and the business of providing this service.  Specifically, those who engage in or repost Black PR may be guilty of criminal defamation for fabricating defamatory information or altering information to make it defamatory if (1) the content results in over 5,000 visits or is retransmitted by at least 500 others (within a one-year period) or causes mental disorder, self-mutilation or suicide by the victims or their relatives; or (2) the offenders have been administratively punished for similar offenses in the last two years.

Although the government generally prosecutes criminal defamation only if a victim presses charges, public prosecutors will pursue those who target multiple victims and cause serious harm or those whose conduct causes mass disturbance, public disorder, conflicts among ethnic groups, damage to national image or interests, or serious impact to foreign countries.  Violations are punishable by up to three years in prison.

Prosecutors may also charge Black PR offenders with criminal provocation, which is punishable by up to five years’ imprisonment, for insulting or intimidating others, fabricating falsified information, knowingly circulating falsified information or abetting others to do so on the Internet, resulting in serious public disorder.

Those who hire, organize, abet or aid others to post or repost harmful content may be held jointly and severally liable.

6. New violation: Blackmail

The Rules make it unlawful to post harmful content or block or alter lawful content and then charge a fee to undo the act.  It is also a crime to threaten to delete content, depending on the frequency of the threats and the amount paid (a minimum of RMB 50,000 in revenue or RMB 20,000 in profit for individuals, and RMB 150,000 in revenue or RMB 50,000 in profit for corporate offenders—about $8,000, $3,200, $24,000, and $8,000, respectively).  Penalties include up to five years’ imprisonment, a multiple of the illegally obtained profits, and forfeiture of assets. If the revenue or profits are five times larger than the above amounts, the penalties increase to up to twenty years in prison

7. New violation: Unauthorized disclosure

The Rules also create a tort for disclosing personal information (including genetic and health information, criminal records, home addresses, and private activities).  Exceptions exist where an individual consents, the disclosure is intended and necessary to promote the public interest, non-personally identifiable information is used for education and technical research (although this also requires consent), the individual has already disclosed the information, or the information comes from a lawful channel and the exercise of governmental powers.

It is lawful for ISPs or their customers to disclose information from governmental documents.  However, this requires showing (1) the documents are the only source of the information, (2) the defendant did not add insulting and defamatory content, use improper titles for content, or alter the information to be misleading, and (3) the information is currently reflected by the source—meaning the disclosing party must update content if the government makes changes.

8. New civil remedy: Investigative costs and legal fees

Existing law already allows a court to require a tortfeasor to apologize, pay compensatory damages, pay mental distress damages, and restore the plaintiff’s reputation.  The Rules now allow courts to require compensation to victims for investigative costs and legal fees, up to RMB 500,000 (about $80,000).

The Decision, Rules and Interpretations represent China’s response to growing public demand that the government help individuals protect their personal rights on the Internet.  They provide powerful tools to deter or remedy harms caused by online speech.  As a result, ISPs should be prepared to defend more lawsuits.

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The Dark Knight, Black Panthers, Ghosts and Ginger Rogers: Increasing Protection for Use of Trademarks in Promotions for Expressive Works http://www.medialawmonitor.com/2015/03/batman-barbie-black-panthers-ghosts-and-ginger-rogers-increasing-protection-for-use-of-trademarks-in-promotions-for-expressive-works/ Sun, 22 Mar 2015 20:45:42 +0000 http://www.medialawmonitor.com/?p=2887 By Jonathan Segal and Alonzo Wickers IV

Content creators of all stripes strive for realism in their depictions of the world.  This is for good reason – media is more effective, and more immersive, when viewers recognize it as a reflection of the real world.

Despite a desire for realism, most people can recall watching a favorite program or a movie, and seeing a nearly real, but somehow generic product – like the “Morley” cigarettes from the X-Files, or Coca-Cola cans disguised to just say “Cola.”  The experience can be jarring, pulling a viewer out of the carefully crafted suspension of disbelief that producers seek to create.  Similarly, it is common to see unsightly blurs obscuring logos on the clothing of reality-show participants, or computer logos hastily covered up with sheets of post-it notes.  Despite these efforts – sometimes made out of an abundance of caution over fears of trademark claims, and sometimes mandated by advertiser sensitivities, or product integration agreements – everyone knows what piece of fruit lurks, glowing on the back of the silver laptops ubiquitous in every office scene.

So, why not abandon the fake brands and blurs, and let real logos and trademarks bloom from every t-shirt, vending machine, and car-chase cupholder?   Although the First Amendment ordinarily protects content creators from liability for the use of trademarks in expressive, editorial content, some producers or publishers are concerned that those protections would not apply if the trademark is shown in an ad or trailer for a television program or movie, or where it is shown on the cover of a book or magazine.

However, while the law on First Amendment protection for the use of trademarks in promotional materials for expressive content is still developing, a growing body of cases suggests that content creators should receive the same degree of protection for their use of trademarks in promotions of editorial works that they receive for the use of marks in the underlying works themselves.  These courts have extended the holding from Rogers v. Grimaldi, 875 F.2d 994, 999 (2d Cir. 1989), that “in general the [Lanham] Act should be construed to apply to artistic works only where the public interest in avoiding consumer confusion outweighs the public interest in free expression,” to apply to promotional materials for expressive works.  Importantly, the Rogers Court made this determination even after explicitly acknowledging that artistic works have a commercial component, as they are bought and sold in the marketplace.  Thus, a number of courts have applied a version of the test first laid out in Rogers, finding that use of trademarks in promotions for expressive works do not violate the Lanham Act if the use of the mark (1) has some artistic relevance, and (2) does not explicitly mislead as to the source or the content of the work.

For example, in Seale v. Grammercy Pictures, 949 F. Supp. 331 (E.D. Pa. 1996), Bobby Seale, a founding member of the Black Panther Party, sued producers for the use of his name and likeness in connection with the promotion of a movie, “Panther,” and a related picture book and home video by putting a photo of an actor portraying him on the cover of a video.  Granting summary judgment to the defendants, the court echoed the Rogers analysis holding that “the First Amendment guarantee of freedom of expression outweighs any potential risk that the Defendants’ use of the Plaintiff’s name and likeness, a photograph of the actor who portrayed the Plaintiff in the film, may implicitly suggest that the Plaintiff endorsed the film or the pictorial history book.”

Although it did not explicitly apply the Rogers test to use of a trademark in a promotion, the Ninth Circuit in Mattel Inc. v. Walking Mt. Prods., 353 F.3d 792, 796-797 (9th Cir. Cal. 2003) implied that the Rogers Test could offer First Amendment protection for the use of trademarks in promotions.  In Mattel, the Ninth Circuit held that a photographer’s absurd portrayal of naked Barbie dolls (in blenders, for example, as baking enchiladas) was protected by the First Amendment.

Indeed, federal courts and the California Court of Appeal have explicitly applied the Rogers test to find that  the use of trademarks on the cover of works, which some may view as promotional, was protected by the First Amendment, even as the courts did not adjudicate questions about separate promotions.

Interpreting Mattel and Rogers, a district court in the Central District of California held that featuring the plaintiff surfboard company’s mark only on a surfboard printed on the back cover of a book Hannah Montana: Rock the Waves was protected First Amendment activity.  Stewart Surfboards v. Disney Book Group, Case No. 10-cv-02982-GAF-SS (C.D. Cal., May 11, 2011).  The Stewart court explicitly acknowledged that “Rogers recognized the need to establish a new test for trademark infringement claims where the use of a trademark has both expressive and commercial components, such as the use of a trademark in the title of an artistic work…”  The district court rejected any argument that the use of the plaintiff’s mark had to be “culturally significant,” holding that “the level of [artistic] relevance merely must be above zero.”  Accordingly, because “the Stewart Surfboards mark, which appears on a depiction of a Stewart surfboard on the back cover of the book, evokes the surfing theme that is reflected in the plot line of the book,” the book’s use of the trademark met “the low threshold” imposed by Rogers.  Additionally, even though the mark was located only on the back cover, the use was not “explicitly misleading” readers or consumers to believe that Steward Surfboards endorsed the book, Miley Cyrus and all.   The book, the court noted, “does not say anything like ‘Brought To You By Stewart Surfboards’ or ‘Presented By Stewart Surfboards,’ nor does it indicate that it is a story about Stewart or his surfboards. To the contrary, the book jacket and spine include the Disney logo, the “Disney Press” logo, and the Disney channel logo, and the back and inside flaps of the jacket describe the book as a story about a girl’s summer vacation.”

Similarly, addressing the use of a mark the title and promotion of a horror film, the California Court of Appeal explicitly held that “where marks have historical significance and similar marks are used in the title of an artistic work or advertising, the Rogers test adequately ensures protection of both the public interest in avoiding consumer confusion and the public interest in free expression.”  Winchester Mystery House, LLC v. Global Asylum, Inc., 210 Cal. App. 4th 579, 590 (2012).  Working off the Rogers court’s observation that “like the artistic works they identify, are of a hybrid nature, combining artistic expression and commercial promotion,” the California Court of Appeal rejected claims from holders of a trademark in the “Winchester Mystery House,” despite the fact that the horror film, which was loosely based on events that allegedly took place in the Winchester house, was called “Haunting of Winchester House”  and featured images of a Victorian style mansion.  The court rejected the plaintiff’s argument that “defendant decided to use plaintiff’s marks in the title and in packaging its film as ‘merely a crass marketing tool, not an artistic decision based upon the subject matter’ of the film,” holding that the fact that “defendant based its film on a true story to generate interest does not mean that the title and the cover of the DVD were not artistically relevant to the underlying film.”  Because “defendant’s use of plaintiff’s marks refers to the meaning associated with plaintiff’s marks, that is, the house built by Sarah Winchester to fend off the ghosts of those killed by Winchester weapons,” it met the burden of artistic relevance.  Indeed, the Court noted that “both the title ‘Haunting of Winchester House’ and the Victorian-style mansion are related to the content of the film.”  Finally, noting that the cover of the DVD explicitly identified the filmmaker, it held that the second prong of the Rogers test, that the use must not explicitly mislead the reader, was satisfied.

Finally, in two recent cases, Fortres Grand Corp. v. Warner Bros. Entm’t, Inc., 947 F. Supp. 2d 922, 924-925 (N.D. Ind. 2013) affirmed on other grounds by Fortres Grand Corp. v. Warner Bros. Entm’t, Inc., 947 F. Supp. 2d 922 (7th Cir. 2014), and Mil-Spec Monkey, Inc. v. Activision Blizzard, Inc., 2014 U.S. Dist. LEXIS 165943, 22-24 (N.D. Cal. Nov. 24, 2014), district courts have applied the Rogers test to promotions of expressive works that were separate from the underlying works.

In Fortres Grand, a district court in the Northern District of Indiana focused on the use of a the trademarked name of a computer-security program in the film The Dark Knight.  The filmmakers named a fictional software program “Clean Slate,” even though a real program existed with the same name.   The film’s marketing team also created two websites to market the film, which used the “Clean Slate” name in connection with their content.  The court, noting that “the websites are essentially a creative outgrowth of the fictional world of the film,” described them as “what a (fictional) citizen of Gotham might find if they were looking for information on the (fictional) Rykin Data company,” which sold the equally fictional “Clean Slate” software.  One of the pages on the website was titled “PROGRAM: ‘CLEAN SLATE'” and explained that “‘Clean Slate’ is the informal name for Rykin Data’s primary service, in which the corporation will amass personal histories (specifically off the Internet) and destroy it permanently.”  Both websites also contained a fictitious patent for the software, stating that the invention could grant a customer “a clean slate within the digital world.”  So, the Dark Knight clearly used the mark in promotions that were separate from the film itself.  Nonetheless, the court found that the promotions were protected speech under the Rogers test even as the plaintiff argued that it was inapplicable to the websites because they were commercial speech.  The court found that the “websites at issue here do far more than simply propose a commercial transaction  — in fact, it is hard to see that they really propose any commercial transaction, other than obliquely convincing consumers to buy a ticket to the film. Instead, they are creative, fictional extensions of the film — artistic works in and of themselves — and are thus entitled to First Amendment protection. The Rogers test therefore applies, and the analysis is the same as with respect to the film.”

A district court in the Central District of California reached a similar conclusion in Mil-Spec Monkey about an advertisement for the Call of Duty: Ghosts video game that incorporated the plaintiff’s trademarked “angry monkey” logo.  The plaintiff is a company that sells “morale patches” that soldiers and others sew onto tactical clothing as a means of self-expression.  The “angry monkey” patch served both as a product but also as the logo of the company.  The video game, which allows players to participate in single and multiplayer virtual military exercises, allowed players to put the patch on their avatars in multi-player mode.  The patch also showed up in the pre-release promotional trailer for the game.  Acknowledging that the game was an expressive work, the court found the Rogers test protected the use of plaintiff’s mark both in the game and in the trailer.  It stated explicitly that the fact that “the Ghosts ‘angry monkey’ design briefly appears in the pre-release trailer for the game’s multi-player mode  . . . does not diminish its artistic relevance within the game.”  Accordingly, there was no genuine issue of material fact as to whether the use of the “angry monkey” design in Ghosts meets the “artistic relevance” prong of the Rogers test.  Additionally, because the game itself and promotional materials prominently and clearly identified Activision as the producer of the game, the inclusion of the “angry monkey” design in promotional materials was not explicitly misleading, the court found.

In the cases discussed above, courts found that use of marks in promotional context, on books and DVD covers, on promotional websites, and in trailers, were protected as extensions of the expressive works themselves.  Although content producers may seek to minimize the incidental use of trademarks in promotional materials for their expressive works, it is likely that the First Amendment offers a degree of protection in the event that trademarks are used in promotional materials, especially when the use of the mark has some artistic relevance and where it is not explicitly misleading, where the producer of the expressive work is clearly identified.

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Vanity Fair Prevails in Libel Suit Brought by Oleg Cassini’s Widow http://www.medialawmonitor.com/2015/03/vanity-fair-prevails-in-libel-suit-brought-by-oleg-cassinis-widow/ Sun, 22 Mar 2015 20:35:02 +0000 http://www.medialawmonitor.com/?p=2883 Photo: Oleg Cassini pictured with actress Grace Kelly in 1954 (Copyright Bettmann/Corbis, AP Images)

By Elizabeth A. McNamara & Alison Schary

Oleg Cassini, the designer who created Jacqueline Kennedy’s iconic styles, had been linked or married to the most beautiful women of his day – Grace Kelly, Marilyn Monroe, Anita Ekberg, Gene Tierney, among countless others.   But Cassini’s death in 2006 revealed a bombshell: unbeknownst to nearly everyone, Cassini had been married for the past 30-plus years to the woman he regularly introduced as his “assistant,” Marianne Nestor.  His death kicked off a bitter estate battle between his no-longer-secret third wife (now widow) and Cassini’s daughter from a previous marriage, Christina Belmont Cassini, which continues to play out in the courtroom and on Page Six to this day.

In August 2010, Vanity Fair ran an article by Maureen Orth titled “Cassini Royale,” exploring Oleg’s colorful career, the ongoing battles over the Cassini estate, and the woman to whom he had been married for over three decades.  Among other reminiscences, a movie producer who had lived with one of Marianne’s sisters noted that the three Nestor sisters “put the Gabor sisters to shame,” as “[e]very one of them latched onto big guys.”  A real estate attorney who had dated Marianne’s other sister recalled “parties the Nestor sisters threw in the 60s in a Fifth Avenue apartment where there were only a few other girls and lots of older guys looking for action.”  He observed: “The game the three Nestor sisters had was to hang out with rich guys, many of them if they could – the guys who could write the checks.”

Unhappy with her portrayal in the Vanity Fair piece (for which she had declined to be interviewed), Marianne filed a complaint against Vanity Fair on the day before her one-year statute of limitations expired under New York law.  She challenged numerous statements from the article, but emphasized her concern with the anecdote about parties in the 1960s.  Then, she served Vanity Fair 124 days later, four days after the statutory period for service had lapsed.

Vanity Fair moved to dismiss the complaint for failure to state a claim and for failure to timely serve.  In response, Marianne amended her complaint and moved for a retroactive extension of her time to serve, claiming that she had miscalculated 120 days as equivalent to four months.  While she admitted there was no good cause for the delay in service, Marianne claimed that the extension should be granted under the broader “interest of justice” standard in CPLR 306-b based on the merits of her action.  In particular, Marianne claimed that the quote referencing the Nestor sisters’ 1960s parties with “lots of older guys looking for action” portrayed her as a “prostitute.”  She also objected to a passage suggesting that she was aware Cassini was carrying on extramarital affairs in their home during their secret marriage, claiming that it imputed unchastity and sexual immorality to her.

On April 19, 2013, the New York County Supreme Court dismissed the suit, finding that the complaint failed to state a claim for libel or infliction of emotional distress, and that for the same reasons, no extension of time to serve was warranted in the interests of justice.  Plaintiff appealed, and on February 10, 2015, the First Department of the New York Supreme Court, Appellate Division, unanimously affirmed the lower court’s dismissal.  The appellate court explained that “[c]ontrary to plaintiff’s contention, the allegedly defamatory statements, including a quoted statement that plaintiff and her sisters used to throw parties in the 1960s that were attended by many wealthy ‘older guys looking for action,’ do not imply that plaintiff was a prostitute and lacked sexual morals.”  While brief in its reasoning, the opinion will be helpful going forward as yet another example of courts refusing to read implications of sexual immorality into G-rated (or even PG-rated) language.

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Davis Wright Tremaine LLP attorneys Elizabeth A. McNamara and Alison Schary represented Advance Publications, publisher of Vanity Fair, in this matter.  Reprinted with permission from the February 2015 issue of the MLRC MediaLawLetter. © 2015, Media Law Resource Center, Inc.  All rights reserved.

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IRS Ordered to Make Non-Profit Form 990s Available In a Useful Electronic Format http://www.medialawmonitor.com/2015/03/irs-ordered-to-make-non-profit-form-990s-available-in-a-useful-electronic-format/ Sun, 22 Mar 2015 20:30:54 +0000 http://www.medialawmonitor.com/?p=2881 By Thomas R. Burke and Dan Laidman

Federal agencies cannot avoid their obligation to disclose public records in modern electronic formats merely by invoking budgetary constraints, a judge has ruled in a rare decision exploring the scope of the Electronic Freedom of Information Act (“E-FOIA”).

United States District Judge William H. Orrick of the Northern District of California ordered on January 29, 2015, that the IRS had to produce a set of records to plaintiff Public.Resource.Org in the machine-readable format that the organization specified in its FOIA request.  Public.Resource.Org v. IRS, 2015 WL 393736 (N.D. Cal. 2015).  The court rejected the IRS’ argument that complying with the request would be unduly burdensome in light of its limited resources, explaining that the “fact that an agency may be under significant financial distress because it is underfunded does not excuse an agency’s duty to comply with the FOIA.”

The litigation concerns Public.Resource’s request for the electronically filed Form 990s for nine tax-exempt charitable organizations.  Form 990s are filed by all non-profit organizations and include information about the finances and activities of nonprofit organizations.  The IRS uses the information to enforce the rules governing nonprofits’ tax-free status.  There is no dispute that Form 990s are public records already subject to disclosure, but the IRS refused to produce them in a machine-readable format, even where the records were originally e-filed with the agency in that manner.  Instead, the IRS has only made the documents available in an image format akin to a low-resolution photograph.

Public.Resource, a nonprofit organization dedicated to improving public access to government records and the law, filed suit under E-FOIA, a 1996 amendment to the Freedom of Information Act which requires federal agencies to provide copies of public records “in any form or format requested … if the record is readily reproducible by the agency in that form or format.” 5 U.S.C. § 552(a)(3)(B).

Public.Resource argued that the IRS’ production of the records in a non-machine-readable image format frustrated efforts by watchdog groups, journalists, academics, and other government agencies to monitor the IRS’ performance by making it extremely difficult to process and analyze information from Form 990s.  It submitted declarations about the public benefit of accessing Form 990s in machine-readable form from experts including its president, Carl Malamud, who has worked to make the IRS Exempt Organizations database more widely accessible while also scrutinizing the IRS’ breaches of taxpayer privacy; the former United States Deputy Chief Technology Officer; the CEO of Charity Navigator; and journalists with the Center for Investigative Reporting and ProPublica, among others.  Public.Resource also invoked President Obama’s Executive Order 13642, Making Open and Machine Readable the New Default for Government Information which sought to “ensure that data are released to the public in ways that make the data easy to find, accessible, and usable.” 78 Fed. Reg. 28111 (2013).

The IRS moved to dismiss the case at an early stage on the grounds that FOIA did not apply at all because the disclosure of Form 990s is governed by a separate provision of the Internal Revenue Code.  Judge Orrick rejected this argument and denied the IRS’ motion to dismiss, holding that FOIA was not superseded, and that given the law’s “pro-disclosure purpose,” it cannot be supplanted by another federal statute absent express language to that effect.  Public.Resource.Org v. IRS, — F. Supp. 2d —-, 2014 WL 2810499 (N.D. Cal. 2014).

Following this threshold ruling, the IRS argued that it should not have to produce the records in the desired format because it would be too burdensome.  While it did not dispute that it receives and maintains e-filed Form 990s in a machine-readable format, the IRS explained that it has an established process for converting the records into image files for processing, which includes redacting certain information which is exempt from public disclosure.  The agency argued that it would have to develop new protocols and train new staff to redact sensitive information from Form 990s in machine-readable format.  It estimated that such efforts would cost $6,200 to produce the nine Form 990s at issue in the desired format, although virtually all of its evidence focused on the overall costs of producing all Form 990s in a machine-readable form.

In his January 29 Order, Judge Orrick denied the IRS’ motion for summary judgment and granted Public.Resource’s cross-motion.  The judge explained that under E-FOIA, to avoid disclosure in a requested format, the “agency’s evidence of burden … must be not only compelling, but also demonstrate that compliance with a request would imposes a significant burden or interference with the agency’s operation.”  As a matter of law, the judge held, the IRS’ evidence failed to meet this burden:  “That the IRS will have to develop new protocols and train staff to respond to Public.Resource.org’s request does not somehow excuse its need to comply with E–FOIA.  If that was a valid excuse, anytime there was a request for production in a format that the agency has not accommodated before, the agency could argue undue burden.”

The court also dismissed the IRS’ argument that its existing production process was sufficient because Public.Resource’s format request was “unique.”  As the court explained, the “IRS cannot defeat Public.Resource.org’s request for disclosure of information in the [machine-readable] format by relying on its own prior practices that are inconsistent with the E–FOIA amendments” – particularly because it was likely that the request was unique because the IRS had previously made clear that it would only produce the records in image format.

The court’s ruling was based on the burdens of producing the nine specific Form 990s at issue in the litigation.  However, the judge suggested that after incurring these “one-time expenses” to establish the necessary protocols for producing machine-readable records, responding to similar requests in the future would be significantly less costly.  The judge ordered the IRS to produce the requested records within 60 days of the order.

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Public.Resource.Org is represented in this matter by Davis Wright Tremaine LLP attorneys Thomas R. Burke, Ronald G. London, and Dan Laidman. 

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Screenwriter SLAPPs Down Libel-in-Fiction Claim http://www.medialawmonitor.com/2015/03/unusual-legal-questions-raised-by-defamation-claims-arising-from-fictional-works/ Sun, 22 Mar 2015 20:25:38 +0000 http://www.medialawmonitor.com/?p=2879 By Kelli L. Sager, Deborah A. Adler, and Dan Laidman

In a victory for all authors of fiction, a screenwriter of the film “What Maisie Knew” has successfully defended a lawsuit that sought to hold him liable for defamation based on the portrayal of a character drawn from an 1897 Henry James novel.

The case highlights the unusual legal questions raised by defamation claims arising from fictional works.  In “libel in fiction” cases, the real-life plaintiff simultaneously claims that he or she is actually portrayed in a fictional work, but also that the portrayal contains some false characteristics or events that are defamatory.  Such counterintuitive claims pose a special risk of chilling artistic expression, by discouraging writers from addressing subjects that overlap with their own personal experience.  The January 20, 2015 ruling, which granted writer Carroll Cartwright’s SLAPP motion and dismissed plaintiff Ronee Blakley’s libel in fiction lawsuit, reinforces the strict First Amendment barriers to such actions.  Blakley v. Cartwright, Los Angeles County Superior Court No. BC543217 (Hon. Rafael A. Ongkeko, presiding).

The key legal issue in most libel in fiction cases is whether a reasonable reader or viewer would believe that the allegedly defamatory statements are actually about the plaintiff.  This constitutionally based “of and concerning” standard requires that “a reasonable person … would understand that the fictional character … was, in actual fact, the plaintiff acting as described.”  Tamkin v. CBS Broadcasting, Inc., 193 Cal. App. 4th 133, 146 (2011).

Defamation cases involving fictional works are nothing new, and have involved many classic works, including the novel and film “Anatomy of a Murder” (Wheeler v. Dell Publishing Co., 300 F.2d 372 (7th Cir. 1962)); and the novel and movie “From Here to Eternity” (New York ex rel. Maggio v. Charles Scribner’s Sons, 205 Misc. 818, 821 (New York City Magis. Ct. 1954)), among others.

And there have been successful libel plaintiffs in cases involving fictional works, although the cases tend to involve circumstances where the plaintiff and the purportedly fictional character shared highly unusual characteristics that were readily identifiable.  For example, in Fetler v. Houghton Mifflin Company, 364 F.2d 650 (2d Cir. 1966), the plaintiff’s brother wrote a novel based on their unique family featuring “a minister father and thirteen children in which the third, fourth and eighth are girls and the eldest a son with great responsibility, who toured Europe in a bus in the 1930s giving family concerts.”  And in Bindrim v. Mitchell, 92 Cal. App. 3d 61 (1979), the plaintiff and main character were both therapists in California who conducted nude therapy sessions, and the author had based passages on actual transcripts from sessions that she attended with the plaintiff pursuant to a non-disclosure agreement.

In more recent years, however, a series of appellate decisions in California have rejected defamation claims arising from the portrayal of fictional characters in films and television shows.  In Aguilar v. Universal City Studios, Inc., 174 Cal. App. 3d 384 (1985), the plaintiff had the same name (“Bertha”) as a character in the movie “Zoot Suit,” and she had participated in real-life events depicted in the film.  In Polydoros v. Twentieth Century Fox Film Corp., 67 Cal. App. 4th 318 (1997), the screenwriter of the film “The Sandlot” knew the plaintiff; a character in the film had a similar background and virtually identical name; and as a child, the plaintiff physically resembled the character “right down to [his] eyeglasses and the color and design of his shirt.”  And in Tamkin, a writer for the TV show “CSI” used the plaintiffs’ real names and occupations for characters in a draft script, and characters in the episode that ultimately was broadcast had similar names and characteristics.  Yet in each case, the courts found that the similarities were too generic or non-specific to establish that the fictional work actually depicted the plaintiff.

The Blakley v. Cartwright litigation arose from “What Maisie Knew,” a 2013 film starring Julianne Moore about a resilient six-year-old girl enmeshed in a bitter custody battle.  Adapted from a 113-year-old Henry James novel, the film updated the story to take place in modern-day New York, but otherwise kept most of the novel’s key plot points and characters.  Mr. Cartwright, the co-author of the film’s screenplay, had a child in 1988 with Ms. Blakley, an actress who was known for her roles in “Nashville” and “Nightmare on Elm Street,” and the pair had a long-running and acrimonious custody dispute.

Ms. Blakley sued Mr. Cartwright in April 2014, claiming that she was portrayed by the character of Maisie’s mother in the film, and falsely depicted as a bad parent.  Among other things, Ms. Blakley alleged that the character’s name, “Susanna,” resembled her middle name, Sue; she and the character both wore red plaid shirts and had similar hair; they were both musicians; and some of the circumstances of the real-life and fictional custody disputes were alike.  She also pointed to public statements that Mr. Cartwright made in connection with the film, in which he mentioned his personal experiences and daughter, and she presented declarations from several of her friends claiming that they believed the film was meant to portray her.

Mr. Cartwright’s SLAPP Motion pointed out, among other things, that the alleged similarities were too superficial or widely-shared to state an actionable claim, and that any similarities were outweighed by stark differences, from the film’s setting to its central plot point, in which Maisie’s mother and father both re-marry, only to see their new spouses become romantically involved with each other.  (The plaintiff did not allege any such real-life events.)  Mr. Cartwright also noted that Maisie’s father was a selfish and unsympathetic character, which undercut the notion that he intended to portray events from his own past.  He also pointed out that courts have rejected the use of declarations to determine what a “reasonable viewer” would have believed; in this case, the declarants were plaintiff’s friends who claimed to have watched the film with her.

The Court agreed with Mr. Cartwright, and granted his special motion to strike Ms. Blakley’s complaint pursuant to California’s SLAPP statute, which provides for the early dismissal of claims targeting free speech.  In a 14-page ruling issued January 20, 2015, Judge Ongkeko concluded that the alleged similarities were “either tenuous or common, non-unique occurrences,” and that as a matter of law, the “statements and alleged similarities cannot reasonably be interpreted as referring to Blakley.”  The Court also found that the plaintiff’s own evidence revealed “areas in which her life diverges from the plot” of the film, and that, read in context, Mr. Cartwright’s public statements were a description of his creative process and not an admission that the character of Maisie’s mother was based on the plaintiff.

Mr. Cartwright’s victory is particularly significant because there were indications that the plaintiff’s legal team (which initially included three sets of lawyers) viewed the case as an opportunity to expand the scope of liability for libel in fiction claims.  Her Complaint quoted from a book written by one of her lawyers, Rod Smolla, in arguing that authors should be held liable when they take a “middle ground” approach of “neither adhering perfectly to the real person’s attributes and behavior nor engaging in elaborate disguise.”  Fortunately, the First Amendment provides broader protections, as the Court’s decision makes clear.

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Davis Wright Tremaine LLP attorneys Kelli L. Sager, Deborah A. Adler, and Dan Laidman represent Mr. Cartwright in this matter.

 

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Penalty! The California Court of Appeal Calls Foul on the NCAA’s Attempt to Seal Records of the USC/Reggie Bush Investigation http://www.medialawmonitor.com/2015/03/penalty-the-california-court-of-appeal-calls-foul-on-the-ncaas-attempt-to-seal-records-of-the-uscreggie-bush-investigation/ Sun, 22 Mar 2015 20:15:42 +0000 http://www.medialawmonitor.com/?p=2877 By Thomas R. Burke and Jonathan Segal

In a significant victory for open court filings, the California Court of Appeal rejected an effort by the National Collegiate Athletic Association (“NCAA”) to seal 400 pages of documents in a dispute between the NCAA and a former assistant football coach at the University of Southern California (“USC”) related to the NCAA’s investigation of star running back Reggie Bush.

The court concluded that the NCAA failed to carry the heavy burden of showing that its interest in the confidentiality of its enforcement proceedings overrides the constitutional right of access and the presumption of openness, or how this interest in confidentiality would be prejudiced if the documents submitted to the court were disclosed.

The court-secrecy dispute arises out of a lawsuit filed against the NCAA by assistant USC coach Todd McNair for defamation and breach of contract, among other claims.  The lawsuit arose in connection with a report the NCAA Committee on Infractions (“COI”) issued related to its investigation into whether Reggie Bush received improper benefits while a student at USC.  (The investigation resulted in a two-year suspension from post-season play, and an order to vacate victories for every game in which Bush played.)

The NCAA sought to dismiss McNair’s lawsuit under the California anti-SLAPP statute (CCP § 425.16).  The NCAA sought to seal the opposition brief that McNair filed to oppose the anti-SLAPP motion and 400 pages of documents, including:  (1) the COI Report; (2) the NCAA case summary provided to the Col; (3) memoranda drafted by members of the COI concerning the allegations; (4) excerpts of witness interviews; (5) telephone records; (6) the notice of allegations; (7) excerpts of the deposition testimony of NCAA officials describing the NCAA’s investigative and adjudicative process; (8) e-mails between COI members while adjudicating the allegations; (9) excerpts of the COI hearing transcripts; (10) plaintiff’s response to the notice of allegations; and (11) his appeal to the NCAA’s Appeals Committee.

To support its sealing motion, which the trial court denied, the NCAA argued that its bylaws require it to keep its investigations strictly confidential.  The NCAA argued that its investigators rely on confidential sources for much of the information they gather, and promise confidentiality to witnesses to obtain needed facts.  If the requested documents were not sealed, the NCAA insisted that its enforcement proceedings would be made public, thereby prejudicing its enforcement abilities and embarrassing witnesses who had relied on confidentiality.

Reviewing the trial court’s decision to deny sealing, the Court of Appeal acknowledged that “[t]he public has a First Amendment right of access to civil litigation documents filed in court and used at trial or submitted as a basis for adjudication. . . . As [NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, 20 Cal.4th 1178 (1999)] explained, ‘the public has an interest, in all civil cases, in observing and assessing the performance of its public judicial system, and that interest strongly supports a general right of access in ordinary civil cases.  If public court business is conducted in private, it becomes impossible to expose corruption, incompetence, inefficiency, prejudice, and favoritism.’”

The Court of Appeal applied the test laid out by the California Supreme Court in NBC Subsidiary, which requires a court to find that (1) there is an overriding interest supporting sealing records; (2) there is a substantial probability that the interest will be prejudiced absent sealing; (3) the proposed sealing is narrowly tailored to serve the overriding interest; and (4) there is no less restrictive means of achieving the overriding interest.  As the party seeking an order sealing appellate court records, the NCAA has the burden to justify the sealing, the Court held.

The NCAA argued that its interest in the confidentiality of its enforcement proceedings overrides the public right of access to documents used as a basis for adjudication. It argued that enforcement is key to assuring some of its basic principles of promoting amateurism and protecting student athletes from exploitation. Additionally, because the NCAA does not have subpoena power, it is forced to rely on “voluntary” participation in its investigations.  If confidentiality were not guaranteed, the NCAA argued, witnesses would be hesitant to offer fulsome cooperation.  Finally, the NCAA argued its bylaws and contractual agreements apparently guaranteed confidentiality, and were overriding interests.

The Court of Appeal rejected all of these arguments.  It found that the confidentiality offered by one of the NCAA’s bylaws was ephemeral – it only lasted until the COI report was issued.  Some of the information to be kept confidential by another bylaw was previously disclosed by the NCAA itself in the COI report.  The Court of Appeal held that “[i]n short, one bylaw the NCAA cites as its overriding interest in confidentiality is temporally limited, and the other bylaws are restricted to witnesses, institutional representatives, and reports of witness interviews. None of the bylaws relied on by the NCAA provides the one-size-fits-all cloak of confidentiality it seeks here.”

The Court of Appeal similarly found that any contractual confidentiality agreements the NCAA entered into did not authorize the court to seal any documents without “a specific showing of serious injury.”  The Court of Appeal explained further that “[b]road allegations of harm, bereft of specific examples or articulated reasoning, are insufficient.”  The NCAA did not put forth any specific showing of injury.

The Court of Appeal also considered, and rejected, the NCAA’s argument that the NCAA’s “insistence on a confidential investigative process endows it with a privilege which would be akin to an overriding interest.”  It noted that “the California Legislature has abolished common law privileges and precluded courts from creating new nonstatutory privileges as a matter of judicial policy.”  The Court of Appeal found that the NCAA could not point to a statutory privilege that was applicable to it. The NCAA had sought to seek the shelter of the Reporter’s Privilege, but the Court of Appeal rejected its attempt, holding that the “NCAA, a private, voluntary organization, is not the media and so no such concomitant privilege exists for the organization.”

Summarizing its holding on the first prong of the NBC Subsidiary test, the Court held that “[o]n balance, the NCAA’s interest in ensuring the confidentiality of its investigations is insufficient to overcome presumption of, and the courts’ obligation to protect the constitutional interest in, the openness of court records in ordinary court proceedings.”

On the second prong, prejudice, the Court of Appeal further considered, and rejected, the NCAA’s claims that the unsealing of the documents would cause it prejudice by sabotaging future investigations and cause embarrassment to past participants.  It was “not convinced” and noted that “[w]hile it is possible that some may shy away as the result of disclosure, it is just as likely that knowing their statements might become public, members of the COI and investigators would ground their evaluations in specific examples and illustrations in order to deflect potential claims of bias or unfairness.” The Court of Appeal noted that NCAA investigative files involving the University of Kentucky and Florida State University were made public through litigation.  The NCAA failed to show that these disclosures “chilled future investigations.”

After finding that the NCAA failed to make its showing in the first two prongs, the Court of Appeal held that it did not need to make further inquiry, and decided to unseal.  While acknowledging that the NCAA provides an important public service, it held that “our analysis here is based on the First Amendment. The constitutional right of public access to, and the presumption of openness of, documents submitted at trial or as a basis for adjudication in ordinary civil cases are designed to protect the integrity of our judicial system.”  The NCAA filed a Motion for Reconsideration that the Court of Appeal summarily denied the following day.

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Davis Wright Tremaine LLP partners Thomas R. Burke and Kelli L. Sager, and former associate Jeff Glasser (now Vice President, Legal, for the Los Angeles Times) represented the Non-Party Press Representatives, The New York Times Company and Los Angeles Times Communications LLC which intervened to oppose the proposed sealing. 

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Tinker, Take Two http://www.medialawmonitor.com/2015/03/tinker-take-two/ Sun, 22 Mar 2015 20:12:06 +0000 http://www.medialawmonitor.com/?p=2875 By Robert Corn-Revere

Two legendary figures in the ongoing fight for student free speech rights are asking the Supreme Court to revisit this thorny area of First Amendment jurisprudence.

John and Mary Beth Tinker were petitioners forty-six years ago in Tinker v. Des Moines Indpt. Sch. Dist., 393 U.S. 503 (1969), the landmark case that established “[i]t can hardly be argued that either students or teachers shed their constitutional rights to freedom of speech or expression at the schoolhouse gate.”  Then, as now, the Tinkers are asking the Court to decide how to honor First Amendment principles “in light of the special characteristics of the school environment.”  Id. at 506.

With the assistance of DWT and UCLA law professor Eugene Volokh, the Tinkers have submitted an amicus brief urging the Court to accept review in a current student speech case, Dariano v. Morgan Hill Unified School District.  The Dariano case arose when some students wore American flag-themed shirts to school on May 5, 2010, while others at Live Oak High School observed “Cinco de Mayo” celebrating Mexican culture and heritage.  Responding to comments that there might be “issues” or “problems” because of the shirts, school officials directed the students sporting the “flag” shirts to remove them, turn them inside out, or go home.   Some students had exchanged profanities during a similar incident the previous year, but in 2010, no classes were delayed or interrupted because of the shirts, no violence occurred at the school, and there were no reports of actual distur­bances.  The students who wore the shirts made no threats, and were not disruptive.  They did file a civil rights action, however, and the lower courts upheld the school’s decision to restrict their silent demonstration.  In doing so, the Ninth Circuit said it was merely applying the Supreme Court’s holding in Tinker.

That’s what riled up John and Mary Beth Tinker.  They could not reconcile the Ninth Circuit’s holding either with their own experience or with their understanding of what the Supreme Court held in their case.  And so they decided to weigh in.

Past as Prologue

The Tinker case arose at the end of 1965 as the Vietnam War was becoming increasingly contro­versial.  Although American involvement was still in its early stages, almost 2,000 U.S. soldiers had already died in the conflict, and another 6,000 would perish in the coming year.  John, then fifteen years old, and his thirteen-year-old sister Mary Beth, an eighth-grader, decided to express their grief over the loss of life and to show support for a proposed Christmas truce by wearing black armbands to school.

Seven students in Des Moines participated in the silent protest despite the fact that the School Board in an emergency meeting had adopted a policy pro­hibiting the armbands.  Five students who violated the policy were suspended from school, including John and Mary Beth Tinker, who, along with Christopher Eckhardt, challenged the ruling in court.

The Supreme Court concluded that “[i]n our system, state-operated schools may not be enclaves of totalitarianism.”  Tinker, 393 U.S. at 506, 511.  In striking a balance between fundamental constitutional safeguards and the authority of school officials to “prescribe and control conduct in the schools,” the Court held that “undifferentiated fear or apprehension of disturbance is not enough to overcome the right to freedom of expression.”  Id. at 507-08.

That decision, and the personal experiences that led to it, forged the Tinkers’ lifelong commitment to promoting First Amendment values.  John is the general manager of KPIP, a low-power com­munity FM radio station in Fayette, Missouri. He is also the editor of Schema-Root.org, a web-based encyclopedia of current events.  Each year, he corresponds with dozens of students who are working on school projects related to Tinker v. Des Moines, and several times each year, he speaks publicly in academic settings about the case.

Mary Beth Tinker has also been active on free speech issues, and in 2013-14 participated in a nationwide campaign to promote student rights known as the “Tinker Tour.”  She traveled more than 25,000 miles by bus and spoke to more than 20,000 students and teachers at over 100 stops that included schools, colleges, churches, youth detention facilities, courts, and several national conventions.  The armband she wore in 1965 is on permanent display at the Newseum in Washington, D.C.

The Core Issue

In the forty-six years since Tinker was decided, school authorities and lower courts have struggled with understanding and applying it in the special circumstances of the school environment.   This difficult balancing act has been rendered more difficult by the fact that, in this entire interval, the Supreme Court has not taken another case analyzing how to apply the relevant test to student political speech.  Instead, it has decided cases involving lewd double entendre at a school assembly, Bethel School District No. 403 v. Fraser, 478 U.S. 675 (1986), editorial control of a school-sponsored newspaper, Hazelwood School District v. Kuhlmeier, 484 U.S. 260 (1988), and a nonsensical banner (“Bong Hits 4 Jesus”) at an event outside a school.  Morse v. Frederick, 551 U.S. 393, 402-03 (2007).  Dariano – like Tinker before it – squarely presents the Court with the problem of the “heckler’s veto.”

Many observers might sympathize with school administrators in Dariano who were merely trying to prevent a clash between students on Cinco de Mayo.  But the core question is whether the constitutionally sound solution is to silence peaceful demonstrators in the face of potential threats.  It is precisely the same issue the Court addressed in Tinker, where the simple act of wearing a black armband involved the risk of violent reaction over political expression.

The District Court in Tinker had refused to protect wearing armbands in school as a form of protest because “debate over the Viet Nam war had become vehement in many localities” and “individuals supporting the war and those opposing it were quite vocal in expressing their views.”  Tinker v. Des Moines Indep. Cmty. Sch. Dist., 258 F. Supp. 971, 972-73 (S.D. Iowa 1966), aff’d, 383 F.2d 988 (8th Cir. 1967) (en banc), rev’d, 393 U.S. 503, 506 (1969).  The court added that, “the reactions and comments from other students as a result of the armbands would be likely to disturb the disciplined at­mosphere required for any classroom.”  Id. at 973.

For the Tinkers, the potential disturbance was not limited just to polite disagreement.  One person telephoned their home on Christmas Eve and said “the house would be blown up by morning.”  See Ronald K.L. Collins & Sam Chaltain, We Must Not Be Afraid To Be Free 270, 277 (2011).   A woman called for Mary Beth, and when the young teen got on the line, said, “Is this Mary Beth?  …  I’m going to kill you.”  Kelly Shackelford, Mary Beth and John Tinker and Tinker v. Des Moines: Opening the Schoolhouse Gates to First Amendment Freedom, 39 J. Sup. Ct. History 372, 378 (2014).  The Tinkers received other threat­ening telephone calls as well.  They also received hate mail, and their house was vandalized with red paint.

A local radio talk show host told his audience he would defend anyone who physically attacked Leonard Tinker, John and Mary Beth’s father, who was a devoted pacifist.  Id.  As Justice Black noted, in school the Tinkers faced “warnings by other students” to the point that “an older football player” felt the need to “warn[]” “that other, non-protesting students had better let them alone.”  Tinker, 393 U.S. at 517 (Black, J., dissenting).

Despite such threats, the Supreme Court held the Tinker children’s speech to be protected by the First Amendment.  It was a classic application of the “heckler’s veto” doctrine – one of the oldest and most venerable in First Amend­ment jurisprudence.  The Court articulated the bedrock principle in Terminiello v. City of Chicago, 337 U.S. 1, 3-5 (1949), that danger from “angry and turbulent” hostile audiences cannot justify censorship.  The ruling in Terminiello came a mere 13 years after the Supreme Court first began to regularly invali­date unconstitutional speech restrictions.

The Supreme Court has reaffirmed the “heckler’s veto” principle on many occasions since then, holding that First Amendment rights cannot be curtailed “simply because of hostility to their assertion or exercise.”  Cox v. Louisiana, 379 U.S. 536, 551 (1965).  “[T]he possible tendency of … words to provoke violent retaliation” (setting aside the narrow zone of “fight­ing words”) cannot justify restricting such speech. Street v. New York, 394 U.S. 576, 592 (1969).  Indeed, “[t]hose wishing to express views unpopular with bottle throwers” cannot even be forced to pay more for their parade permits.  Forsyth Cnty. v. Nationalist Movement, 505 U.S. 123, 134 (1992). They certainly cannot be ordered to stop speaking.

The danger of violent reaction to speech was commonplace in the civil rights movement.  Limiting peaceful civil rights expression because of the fear of violent crowd reactions would have severely undermined both the First Amendment and the cause of equality.  See generally Harry Kalven, Jr., The Negro and the First Amendment 140-46 (1965) (discussing the “heckler’s veto” as a barrier to civil rights).  Fortunately, the Supreme Court repeatedly re­sponded by holding that “[p]articipants in an orderly demonstration in a public place” cannot be punished or silenced simply because “their critics might react with disorder or violence.”  Brown v. Louisiana, 383 U.S. 131, 133 n.1 (1966).

Even the expression in the classic case W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624, 642 (1943) – a silent refusal to salute the American flag – risked violent reaction.  When that case reached the Supreme Court at the height of World War II, more than 2,000 Jehovah’s Witness children had been expelled from schools because of their religious convictions about the flag.  Michael Welch, Flag Burning 6 (2000).  In 1940, an estimated 1,500 Jehovah’s Witnesses were victims of mob violence in 355 communities in 44 states in just a six-month period.  See Constitutional Amendment to Prohibit Physical Desecration of U.S. Flag, S. Rep. No. 108-33, at 57 n.17 (July 22, 2004) (minority views).

In such an atmosphere, a school principal con­fronted with a wave of patriotic fervor might con­clude that preventing potential disruption justifies forcing a few dissenters to profess love for flag and country.  After all, if the Ninth Circuit’s decision in Dariano is correct in holding that the need for order in the public schools trumps the “heckler’s veto” doctrine, why not dispense with the prohibition against compelled speech as well?  Yet the Supreme Court made clear – even (perhaps especially) against the backdrop of the violent hosti­lity to those who refused to salute the flag – that such a refusal is protected by the First Amendment.

To be sure, school administrators may and should try to prevent physical confrontations at school. But though the “special characteristics of the school environment” give officials some latitude in main­taining order, Tinker, 393 U.S. at 506, these charac­teristics do not give officials absolute discretion in achieving that objective.

The question is not whether order is to be main­tained in the schools, but how it is to be maintained.  It must be done in a way that is consistent with constitutional values.  As Justice Robert Jackson wrote for the Court in Barnette, 319 U.S. at 637, the Bill of Rights “protects the citizen against the State itself and all of its creatures – Boards of Education not excepted.”  This means that schools should not be permitted to meet their responsibilities simply because silencing speech may be “the path of least resistance.”  McCullen v. Coakley, 134 S. Ct. 2518, 2534 (2014).  The government may not “sacrifice speech for efficiency.”  Riley v. National Fed. of Blind of N.C., Inc., 487 U.S. 781, 795 (1988).

This is nothing more than recognition of the broader First Amendment concept that a speaker cannot be muzzled simply because the speech may prompt misconduct by a third party. Likewise, the government may not prohibit leafleting on the grounds that some recipients of the missives are litterbugs.  E.g., Schneider v. New Jersey, 308 U.S. 147, 162 (1939) (“There are obvious methods of preventing littering.  Amongst these is the punishment of those who actually throw papers on the streets.”).  And this is true even though restricting the leafleters may be easier, and more effective, than restricting the litterers.

The same is so with regard to hostile hecklers.  The need to prevent disruption of the school environ­ment cannot justify restricting students who engage in peaceful symbolic speech simply because others may take boisterous exception.  Otherwise, as Judge O’Scannlain explained in his dissent from denial of rehearing en banc in Dariano, “[t]he de­mands of bullies will become school policy.”

Teach Our Children Well

The Dariano case is also important because it serves as a teachable moment in the history of free expression – and one that is particularly potent given the purpose of public schools.  “Our Government is the potent, the omnipresent teacher.  For good or for ill, it teaches the whole people by its example.”  Olmstead v. United States, 277 U.S. 438, 485 (1928).  This is a particularly important concept in our educational institutions.  Public schools are vital institutions in preparing individuals for participation as United States citizens and in preserving the values of our democratic system.  Ambach v. Norwick, 441 U.S. 68, 76 (1979).  “That schools are educating the young for citizenship is reason for scrupulous protection of Constitutional freedoms of the individual, if we are not to strangle the free mind at its source and teach youth to discount important principles of our govern­ment as mere platitudes.”  Barnette, 319 U.S. at 637.

And the lesson of the lower court decision in Dariano is a particularly bad one – it instructs would-be censors that violence works.  “[T]he ‘heckler’s veto’ rewards the enemies of freedom for their misbehavior.” David P. Currie, The Constitution in the Supreme Court: 1946–1953, 37 Emory L.J. 249, 265 (Spring 1988).  Instead of preventing disruption, the Ninth Circuit’s reasoning will thus encourage threats, or perhaps even violence that helps make the threats more credible.  As Judge O’Scannlain explained in his dis­sent from denial of rehearing, the panel’s holding sends the message that “by threatening violence against those with whom you disagree, you can enlist the power of the State to silence them.  This perverse incentive created by the panel’s opinion is precisely what the ‘heckler’s veto’ doctrine seeks to avoid.”

It is ironic that the student expression censured in Dariano involved a showing of respect for the American flag.  A lifetime ago, the Supreme Court held that the government could not compel schoolchildren to salute the flag precisely because the First Amend­ment “includes both the right to speak freely and the right to refrain from speaking at all.”  Barnette, 319 U.S. at 645 (Murphy, J., concurring).  For the same reasons, the government should not be allowed to prohibit school­children from displaying the flag with pride.

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DWT Asked To Serve As Legal Counsel for Stand Up For Speech Litigation Project http://www.medialawmonitor.com/2015/03/dwt-asked-to-serve-as-legal-counsel-for-stand-up-for-speech-litigation-project/ Sun, 22 Mar 2015 20:10:42 +0000 http://www.medialawmonitor.com/?p=2872 By Lisa B. Zycherman

Constitution Day 2013 was a pretty bad day for the Constitution on our public university campuses. That was the day that Robert Van Tuinen of Modesto Junior College in California was prevented from passing out copies of the Constitution outside of his school’s tiny “free speech zone.”  On that same day, near Los Angeles, Citrus College student Vinny Sinapi-Riddle was threatened with removal from campus for the “offense” of collecting signatures for a petition against National Security Agency (“NSA”) domestic surveillance outside his college’s tiny free speech area.

The absurdity of these constitutional violations is obvious. But, due to the continuing threat of campus speech codes—rules that restrict what students may say and where they may say it—offenses like these are more frequent than we want to believe. The only difference between these two cases and the many others is that Robert and Vinny decided to challenge their schools in court.

Over the past year, the Foundation for Individual Rights in Education (FIRE) launched a nationwide litigation project to finally end speech codes on public campuses. Davis Wright Tremaine is honored to be asked to participate in this important work.

DWT attorneys Robert Corn-Revere, Ronnie London, and Lisa Zycherman, working together with local counsel, began this project in the fall of 2013, with a lawsuit at Modesto Junior College. Following that astonishing example, we actually found another case, at the University of Hawaii at Hilo, in which two students—Merritt Burch and Anthony Vizzone—were also told that they could not approach students to hand out Constitutions. The Modesto Junior College and University of Hawaii at Hilo suits both settled after each school adopted new policies protecting student speech rights and paid $50,000 apiece in damages and attorney’s fees.

On July 1, 2014, the Stand Up for Speech Project filed four additional suits to remedy systemic constitutional violations and generate greater awareness of the importance of protecting the First Amendment rights of students and faculty at our public institutions of higher education. On that day, Vinny and plaintiffs at three other schools filed federal lawsuits asserting their rights. The First Amendment violations alleged in the four suits are blatant:

At Citrus College, Vinny was threatened with being kicked off campus for speaking to another student outside the school’s tiny and ironically-named “free speech zone” about his petition drive protesting activities of the NSA. This happened despite the fact that protections for free speech in the public forum were first articulated by the Supreme Court almost 80 years ago, as well as the fact that Citrus College was already once forced to eliminate a free speech zone, after a lawsuit settlement in 2003. Citrus College has since settled Vinny’s claims after paying $110,000 (to cover damages and attorney’s fees) and adopting new policies that protect student rights.

At Ohio University, Isaac Smith and Students Defending Students, a student due process assistance group for which he serves as associate director, were ordered to stop wearing shirts with a mildly risqué slogan (“We get you off for free”) under a vague school policy prohibiting “demeaning” or “degrading” speech. Officials at the school took this action despite the fact that the Supreme Court held 44 years ago that the First Amendment protects clothing with political slogans—even crude ones—in a case that involved a jacket urging an anatomically improbable act involving the military draft. The University has agreed to settle the case after adopting new university policies that protect student rights to free expression and paying $32,000 in damages and attorney’s fees.

At Chicago State University, the administration is going to great lengths to silence faculty members Phillip Beverly and Robert Bionaz for their blog, the CSU Faculty Voice, which provides critical commentary on mismanagement at the university. Among other tactics, the school has adopted a broad and poorly defined “Cyberbullying Policy” as a tool of censorship. These efforts fly in the face of principles reaffirmed by the Supreme Court last year—again unanimously—that speech by teachers intending to reveal corruption and the misuse of public funds “lies at the heart of the First Amendment.”  The University’s motion to dismiss the litigation was recently denied by a federal judge and the court is now considering the professors’ motion for an injunction to prevent the University from enforcing its unconstitutional speech codes.

At Iowa State University, the school manipulated its trademark policy to deny approval for certain t-shirt designs proposed by the ISU Chapter of the National Organization for the Reform of Marijuana Laws (“NORML”). ISU hid behind the pretexual claim that the shirts somehow promoted illegal drugs or suggested that the message was endorsed by the university, when it is abundantly clear that the shirts merely state NORML ISU’s position on the political issue of drug policy reform. Students Paul Gerlich and Erin Furleigh are challenging this clear example of political censorship. In January, a federal judge denied ISU’s motion to dismiss the case, finding that ISU’s “creative argument” that the students’ case was really about trademark protection issues rather than a constitutional violation missed the mark.

Most recently, at Western Michigan University, the school denied the Kalamazoo Peace Center permission to use university space for a keynote address by activist Boots Riley at the group’s annual Peace Week commemoration citing “public safety.”  When presented with evidence that Riley had appeared on other college campuses without incident, WMU notified KPC that it could hold the event on campus—but only after paying $62 per hour for private security. KPC and its co-directors Jessica Clark and Nola Wiersma filed suit alleging that the university should not be permitted to impose a tax on controversial speech. The case is still pending.

The Stand Up For Speech cases are just examples of the type of censorship that takes place on American college campuses every day. The ugly truth is that American college campuses are now places where wearing t-shirts, collecting petition signatures, blogging, or distributing our nation’s founding documents can get you in trouble. The Stand Up For Speech project will continue to bring new cases until we reinforce the message, first articulated by the Supreme Court more than four decades ago, that “state colleges and universities are not enclaves immune from the sweep of the First Amendment.”

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Court Denies Request to Release a Video Deposition of Steve Jobs Shown During Trial http://www.medialawmonitor.com/2015/03/court-denies-request-to-release-a-video-deposition-of-steve-jobs-shown-during-trial/ Sun, 22 Mar 2015 20:00:58 +0000 http://www.medialawmonitor.com/?p=2849 By Thomas R. Burke and Diana Palacios

While sitting for a videotaped deposition, in one of his last public appearances, the late Apple CEO Steve Jobs swiveled impatiently in his chair and answered questions regarding Apple’s digital rights management technology in a tone that altered between boredom and sarcasm.  Or so we are told; we actually have not seen the video and nor will the general public, based on a ruling by U.S. District Court Judge Yvonne Gonzalez Rogers of the Northern District of California.

Indeed, except for the few who were present in the courtroom in Oakland, California, on December 5, 2014, when the video was played during the iPod antitrust trial, no other member of the public has seen the video recorded several years earlier and the federal district court judge who presided over the trial ordered that the video not be made available for public viewing.  Apple iPod iTunes Antitrust Litig., — F. Supp. 3d —, 2014 WL 7323399 (N.D. Cal. Dec. 17, 2014).

Three media organizations—Bloomberg L.P., The Associated Press, and Cable News Network, Inc. (CNN)—fought to make the video public.  They argued that based on the First Amendment and federal common law, the press and public had the right to view and copy the portion of Mr. Jobs’ video deposition that was shown to the jury in open court.  This right of access applied even though the video was never formally admitted into evidence by either party.  Application of CBS, Inc., 828 F.2d 958 (2d Cir.1987).  The Jobs deposition video was shown to the jury by the plaintiffs.  Apple vehemently opposed the release of the video, arguing that the right of access did not apply because the video was not a judicial record and Mr. Jobs’ privacy interests outweighed the public interest in the video.

Thus, the request raised the important question of what constitutes a judicial record under the right of access—a question that the Ninth Circuit has yet to answer.  The media organizations advocated for an expansive definition – one that would extend to any material presented in open court regardless of whether it was formally admitted into evidence.

The court disagreed, holding that “the request is not authorized by current Ninth Circuit precedent and such an extension of existing law is not warranted or prudential.”  The video was not a judicial record, the court explained, because it was not admitted into evidence.  It was “merely presented in lieu of live testimony due to the witness’s unavailability, and was and should be treated in the same manner as any other live testimony offered at trial.”  The Court pointed out that the Court provided the media with advanced notice of when the Jobs’ deposition video would be shown to the jury, provided room in her courtroom for the media to observe the video and made the transcript of Mr. Jobs’ testimony publicly available.  The Court found support in an Eighth Circuit case, which held that the video deposition of President Clinton was not a judicial record and the press’s First Amendment right of access was satisfied by allowing them to attend the playing of the video deposition and providing a copy of the transcript.  United States v. McDougal, 103 F.3d 651, 654 (8th Cir. 1996).

Judge Gonzalez Rogers was concerned not only about the privacy implications of releasing the video in this case, but possible requests in other unrelated cases.  Of course, Mr. Jobs is deceased and his rights of privacy have terminated.  The Court however, speculated that “if releases of video depositions routinely occurred, witnesses might be reticent to submit voluntarily to video depositions in the future, knowing they might one day be publicly broadcast.”  The Court also tacitly relied on the local rule banning cameras in the courtroom, except under particular circumstances, stating “[i]f cameras in courtrooms were not currently prohibited, the argument might have less weight.”

The Court’s ruling against access offers another example of the secrecy that permeates federal courts particularly when it comes to video recordings.  At the moment, federal courts are often at a rudimentary level when it comes to transparency and camera access issues particularly when compared to other branches of government and the decades of experience of many state courts.  Of course, federal courts are steeped in tradition and move cautiously, but these values are currently at odds with the right of access.

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