JOLT Digest

District Court Declares Purchasers of Software to Be Licensees
By Anna Volftsun — Edited by Joshua Gruenspecht

MDY Industries, LLC v. Blizzard Entertainment, Inc. et al.
District Court of Arizona, July 14, 2008, No. CV-06-2555-PHX-DGC
Order (via Justia)

The District Court of Arizona entered a summary judgment motion finding that MDY Industries, LLC (“MDY”), creators of a software program called WoW Glider (“Glider”), were liable for contributory and vicarious copyright infringement because their program loaded a copy of a copyrighted Blizzard Entertainment, Inc. and Vivendi Games, Inc. (collectively, “Blizzard”) game into computer memory on the game-owners’ machines against the terms of the game’s End User License Agreement (“EULA”). As part of this decision, the Court also found that over-the-counter buyers of the computer game were licensees rather than owners and were thus bound by the terms in the EULA.

Judge David Campbell ruled that the EULA created a limited license rather than a sale because the title explicitly uses the word “limited” and because several of the provisions contain explicit restrictions on the use of the game which, when read together, prohibit the use of Glider. As licensees rather than owners of the game, users were only allowed to copy it under circumstances dictated by the EULA and were thus guilty of direct infringement when they used Glider because it loaded the game into the user’s RAM. A line of Ninth Circuit cases had previously held this to be “copying,” an exclusive right of the copyright holder under Section 106 of the Copyright Act. MDY was found to be liable for contributory and vicarious copyright infringement because it materially contributed to users’ direct infringement, profited from it, and declined to exercise its ability to stop Glider users from activities infringing the license.

The motions of both parties can be found here.

Public Knowledge argued that because 17 U.S.C §117 reserves to the computer user the right to make RAM copies to run the program, this construction of the EULA will allow Blizzard to retain rights it has never owned. Their amicus brief can be found here, and and Blizzard’s reply can be found here.

The Patry Copyright Blog notes the dismissal of the DMCA claim with approval but finds the copyright ruling to be wrongly decided and to also be a “chilling extension of control” by copyright holders over their products.

Corynee McSherry of the Electronic Freedom Foundation Blog also disagrees with the copyright ruling and notes other recent district court cases under Ninth Circuit jurisdiction which have come out differently, speculating that there will be an appellate decision on this matter soon.

A Note by Christina Hayes published at 22 Harv. J.L. & Tech. touched on whether Blizzard’s EULA could be enforced to limit users’ copyright fair use rights. (more…)

District Court Will Not Require Ebay to Make Greater Effort to Police Trademark Infringers
By Jeff Gritton — Edited by Joshua Gruenspecht

Tiffany, Inc. v. eBay, Inc.
S.D.N.Y., July 14, 2008, No. 04 Civ. 4607
First Circuit, June 18th, 2008, Nos. 07-2078, 07-2246
Slip Opinion

On July 14, the Southern District of New York denied Tiffany’s claims of direct and contributory trademark infringement against eBay. The court agreed with eBay that, as a legitimate seller of Tiffany goods, the online auctioneer had the right to use the Tiffany marks under the nominative fair use doctrine. It also rejected Tiffany’s demand that eBay be held jointly and severally liable for sales made on eBay.com by third parties.

Tiffany instigated this suit against eBay after its research showed that the majority of claimed Tiffany products for sale on eBay were counterfeit. While eBay provided reporting services for both users and trademark holders to notify its fraud division of counterfeit items, Tiffany had requested a more proactive solution: removal of all sellers placing five or more Tiffany items up for sale and suspension of the use of the Tiffany mark on the eBay site and in eBay advertising.

Brad Stone at the New York Times notes that courts in two prior international cases brought by luxury brands (Rolex in Germany and Louis Vuitton in France) had ruled against eBay. The divergent opinions may pose a challenge to eBay’s operation of a single global marketplace.

Professor Eric Goldman also provides a detailed analysis of the case. (more…)

District Court Compels Disclosure of YouTube User Logging Records, Protects Source Code
By Jay Gill — Edited by Sarah Sorscher

Viacom International, Inc. v. YouTube, Inc.
S.D.N.Y., July 1st, 2008, No. 07 Civ. 2103
Order (Provided by Justia)

The District Court for the Southern District of New York partially granted a discovery motion made by Viacom in its copyright suit against YouTube and YouTube’s parent company Google. The order compels Google to produce the contents of YouTube’s logging database, including the login IDs, IP addresses, and viewing information of YouTube users. The court denied Viacom’s motion to compel production of the protected source code for the Google search engine.

Viacom’s complaint alleges that YouTube is directly or vicariously liable for duplication of copyrighted material on youtube.com, and seeks damages of over $1 billion and injunctions against further infringing conduct.

Wendy Seltzer at the Citizen Media Law Project summarizes the bifurcated outcome of the case: “trade secret wins; privacy loses.” Kurt Opsahl of the Electronic Frontier Foundation calls this a “setback to privacy rights,” and argues that some of the login names and IP address information, which the court states are anonymous, can in fact be used to identify individual users.
(more…)

District Court Denies Yoko Ono Lennon’s Motion for Injunctive Relief
By Nicola Carah — Edited by Evie Breithaupt

Lennon v. Premise Media Corp.
S.D.N.Y., June 2, 2008, No. 08cv03813
Slip Opinion

The District Court for the Southern District of New York denied Yoko Ono Lennon’s motion for preliminary injunctive relief in a case involving Premise Media Corp.’s use of a fifteen-second clip of the song “Imagine” in Expelled, its controversial documentary about intelligent design. The court found that the plaintiffs failed to show a clear likelihood of success on the merits — required to obtain preliminary injunctive relief — because the defendants were likely to succeed in asserting an affirmative defense of fair use.

The court looked to the fair use factors articulated in § 107 of the Copyright Act of 1976: “(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.” Although Expelled is commercial in nature, the court found that the movie’s use of “Imagine” is “highly transformative, and not merely exploitative.” According to the court, the pairing of the lyrics and accompanying music to a sequence of images provided “a layered criticism and commentary of the song.” The court concluded, therefore, that defendants were likely to prevail on their fair use defense.

Expelled is a feature-length film that, according to one producer, “examines the scientific community’s academic suppression of those who ask provocative questions about the origin and development of life.” It is narrated by actor and writer Ben Stein, who graduated as valedictorian from Yale Law School in 1970, and who recently has become a proponent of Intelligent Design theory. (more…)

N.D.Cal. Grants Preliminary Injunction Requiring ODNI to Turn Over FISA-Related Documents

By Yelena Shagall — Edited by Wen Bu

Electronic Frontier Foundation, Inc. v. Office of the Director of National Intelligence, No. C 07-5278 SI
District Court for the Northern District of California, November 27, 2007
Order

On November 27, the District Court for the Northern District of California granted in part and denied in part a motion by the Electronic Frontier Foundation (EFF) for a preliminary injunction against the Office of the Director of National Intelligence (ODNI) ordering release under the Freedom of Information Act (FOIA) of communications concerning proposed amendments to the Foreign Intelligence Surveillance Act (FISA). The court ordered ODNI to provide an initial release by November 30, to provide a final release of all documents by December 10, and to provide an affidavit with its final release explaining why it withheld any withheld documents.

The court first held that a preliminary injunction may be granted in FOIA cases. It then found that EFF was entitled to a preliminary injunction. The court reasoned that EFF would likely prevail on the merits of its FOIA claim and suffer irreparable injury in the absence of relief; ODNI would not be burdened; and the public interest favored the injunction.

The court noted ODNI’s failure to justify its request to extend its response time from 20 days to 4 months and the irreparable harm to the public that would result from its inability to access information on the pending FISA amendments until after the Congressional vote expected before the end of the year. The court suggested that ODNI’s objections to the burdens imposed by compliance with FOIA should be addressed to Congress rather than the courts.

EFF issued a press release touting the importance of the order, as well as an earlier release explaining its pursuit of the case.
Kim Curtis of the Associated Press calls the order a “minor victory” in EFF’s challenge to the Bush administration’s domestic surveillance program.
Glenn Greenwald of Salon.com considers the order a significant victory for EFF, and argues it will provide the public with vital information concerning extensive lobbying and donations from the telecommunications industry to influence Congress to grant immunity from “past lawbreaking.”
(more…)