EU Extends Copyright for Sound Recordings by 20 Years

In the European Union, popular music recordings from the 1960’s from acts such as the Beatles and the Rolling Stones were poised to enter the public domain as a result of the expiration of their 50-year copyright term.  In September 2011, however, the European Union voted to extend copyright protection for these works for another 20 years. 

 Perhaps to assuage critics who claim that record labels (and not struggling musicians) will benefit most from the extension, the new EU directive contains a number of accompanying measures to provide balance to individual musicians who may not directly benefit from the copyright extension, including the following:

•  rights to a sound recording may revert to the artist if the record label does not make the recording available for sale to the public (the “use it or lose it” clause);
• a “clean slate” provision that prevents the record label from making any deductions during the extended copyright term from the contractual royalties due to featured artists; and
• creation of a fund, financed by record labels with a percentage of benefits obtained from the copyright extension, for session musicians who signed away rights when a recording was made.

Details as to how some of these measures will be implemented or enforced is not clear from the language of the new directive.  Nevertheless, it seems likely that EU Member States will be expected to implement these accompanying measures in addition to the term extension. 

U.S. Supreme Court Restores Copyright Protection to Foreign Works

On January 18, the U.S. Supreme Court, in a decision watched closely by musicians, publishers, educators, orchestra conductors, upheld a federal law restoring copyright protection to millions of books, paintings, films and musical compositions by foreign artists that were previously in the US public domain.  In doing so, the Court rejected constitutional challenges to the law, holding that nothing in the Copyright Clause or the First Amendment “makes the public domain, in any and all cases, a territory that works may never exit.” 

 The case, Golan v. Holder (docket 10-545), involved a 1994 law enacted by Congress (which became Section 514 of the Copyright Act) to implement certain provisions of the Berne Convention for the Protection of Literary and Artistic Works.  Article 18 of the Berne Convention required member countries to accord other countries minimum levels of copyright protection and treat authors of other countries in the same manner as they treat their own with respect to that protection.  While the U.S. joined Berne in 1989, it did not implement Article 18, in effect, disregarding protection for foreign works.  In 1994, the Berne Convention specifically mandated implementation of Article 18, leading Congress to enact Section 514, which was challenged in Golan.  Section 514 granted copyright protection in the U.S. to foreign works on the same basis as enjoyed under foreign copyright law. 

 Since prior to the enactment of Section 514, the U.S. did not recognize the foreign copyright protection of these works, they were considered to be in the American public domain.  Thus, upholding the application of Section 514, with its equal treatment of works under foreign copyright law, has the effect of providing copyright protection to works that were previously in the public domain.  As noted by Justice Ginsberg, the law merely puts “foreign works on an equal footing with their U.S. counterparts.”

Other provisions of Section 514 take into consideration its impact and attempt to ease transition to the new regime.  In particular:

•  restored works will only be protected until the expiration of the full copyright terms, whether that expiration occurs in the U.S. or in the origin country;
• reanimation of copyright will be limited to only the remainder of the copyright term the work would have been entitled had it never entered the public domain;
•  “reliance parties” who used or acquired a foreign work in the public domain prior to the enactment of Section 514 will be allowed to continue to use the work until the copyright owner gives notice of an intent to enforce; and
• derivative works based on restored or reanimated work must only pay the copyright owner “reasonable compensation” to indefinitely exploit the derivation.

As the Supreme Court noted, unanswered questions remain about how Section 514 will be implemented, but the Court did not consider those questions significant enough to require rejection of the law.  In particular, the treatment of “orphan works” (when the copyright owners of the newly regulated foreign material cannot be identified or located), will likely be among the first issues for Congress to resolve next.

“Termination Rights” To Take Effect in the U.S.        

On January 1, 2013, the controversial “termination rights” provision of U.S. copyright law will be triggered, allowing authors (and their heirs) to begin regaining control of their original works from publishers and record labels to whom the works were previously assigned.  For works assigned in 1978 and thereafter, Section 203 of the Copyright Act of 1976 allows an original author to exercise an option to terminate the existing owners’ rights if 35 years have expired since the assignment. 

The wording of this provision suggests that termination rights are absolute for the original author or heirs, and thus would prevail over any written agreements assigning ownership, even if the agreements state that they are in perpetuity.  There is, however, an important exception for “works for hire,” which are deemed the property of the publisher or record label.     

Termination rights are a particularly hot topic for the music business.  Once a master recording reaches its 35-year mark, it is “game on” for the artists and songwriters who wish to reclaim ownership of qualifying songs from publishers and record labels.  However, it is likely that any attempt to recapture rights will hinge on the language of the applicable contracts between the artists and songwriters, on one hand, and labels and publishers, on the other, specifically whether there is clear assignment language (which would be subject to termination) or “work for hire” language (which would leave ownership of the works with the applicable label or publisher). 

One concern with “termination rights” is the lack of clarity in this provision as it may relate to musicians.  For example, it is unclear who exactly can qualify as an “author” of a sound recording, casting some ambiguity over who can share the rights after they revert.  The law is also murky for non-U.S. artists and whether those artists can exercise termination rights on American recordings.  What is clear, however, is that to enforce termination rights, authors (or their heirs) must comply strictly with the law.  Some of the provisions to be aware of include:

•  a requirement to file termination notices as much as ten years in advance of the effective termination date, but no less than two years before the date an author hopes to recoup their work;
• a provision stating that once a song or recording qualifies for termination, the author has five years in which to file a claim or else the right to reclaim the work relapses;
• a rule that, for works created post-1978 with multiple authors or heirs, a majority must agree to terminate; and
• a caveat that the law only has effect in the U.S., so that a publisher assigned a worldwide copyright will still retain control in foreign markets.

For publishers and other existing owners of copyrighted works who face pending terminations, there are certain considerations to keep in mind:

• time is of the essence to reach out to songwriters or their estates to attempt to negotiate a new deal; 
• if a notice of termination has already been issued, only the current publisher may try to enter into a new deal with the songwriter or his estate before the termination takes effect;
• opportunities may exist for new copyright acquisitions from authors who seek to enforce their termination rights against existing copyright holders, but who may be in the market for a deal with a new publisher; and
• consider whether the “works for hire” exception applies. 

We will keep abreast of developments in these areas, particularly as the new implementation and enforcement schemes are developed.  And we are available to assist any copyright stakeholder seeking to assess how these changes in the copyright law may affect their rights.

**  Betsy Pierce, an associate with the Firm, assisted in the research and drafting of this post.

1)       Cartoon Network, LP v. CSC Holding Inc.

Among the most recent and important decisions impacting cloud-based storage and distribution of entertainment content was the Second Circuit’s 2008 decision in Cartoon Network, LP v. CSC Holding Inc. (“Cablevision Case”), which addressed the copyright implications of a cloud-based DVR system. Specifically, cable operator Cablevision Systems Corporation (“Cablevision”) announced plans in March 2006 to market a “remote storage DVR system” (“RS-DVR”) to allow subscribers without a stand-alone DVR to record cable programs on central hard drives Cablevision maintained at a “remote” location. In response, major networks and studios sued Cablevision in federal court, claiming that the RS-DVR would directly infringe their rights to reproduce and publicly perform their copyrighted works. The district court agreed and enjoined Cablevision from operating the RS-DVR system without additional licenses from the plaintiffs. Cablevision appealed and the Second Circuit reversed the decision on all three infringement counts.

The first claim rejected by the Appeals Court was that the brief caching of buffering data while Cablevision’s system queried whether the customer had actually requested the program be recorded on to the applicable hard drive violated the exclusive right of reproduction. The Appeals Court held that the buffering period was so negligible as to fail the Copyright Act’s requirement that a copy of work be fixed in a tangible medium “for more than a transitory duration.” This point is potentially significant for future cloud business models given that cloud-based services may enable the storage, manipulation and distribution of content in multiple formats across multiple devices, which will continue to no doubt further implicate transitory caching of content at multiple stages in the process.

The second claim reversed by the Appeals Court was that Cablevision was liable for direct copyright infringement for copying programs to the RS-DVRs. Here, the Appeals Court held that Cablevision did not evince the required “volitional conduct” that actually caused the copy to be made and found that Cablevision’s conduct in designing, housing, and maintaining a system did not amount to direct infringement.

The third and perhaps most controversial claim reversed by the Appeals Court was that the transmission of programming from the RS-DVR to subscribers who requested playback breached the public performance right. Here, Cablevision argued (and the Appeals Court found relevant) that, “because each RS-DVR transmission is made using a single unique copy of a work, made by an individual subscriber” only one subscriber is capable of receiving the transmission of that particular work and thus the performance is not “public”.

Ultimately, the holding in the Cablevision Case that individualized copies of content specifically streamed to subscribers from remote DVRs constitute private, as opposed to public, performances introduces a lack of clarity regarding the rights necessary for cloud-based transmissions of audio/visual content. Put simply, the question remains as to whether streaming of legally obtained content to an end user from the cloud (e.g., MP3 tracks stored in a digital locker, etc.) implicates the public performance right. As a result, purveyors of cloud-based business models are left considering whether additional authorization is required from copyright holders, and in the absence of obtaining that consent, whether the potential exists that another tribunal could later disagree with the Second Circuit’s holding in the Cablevision Case. Furthermore, the application of the holding in the Cablevision Case to alternate fact patterns and business models, as even the court itself acknowledged, provides limited guidance.

“This holding, we must emphasize, does not generally permit content delivery networks to avoid all copyright liability by making copies of each item of content and associating one unique copy with each subscriber to the network, or by giving their subscribers the capacity to make their own individual copies. We do not address whether such a network operator would be able to escape any other form of copyright liability, such as liability for unauthorized reproductions or liability for contributory infringement.”

2) Capitol Records, LLC et al. v. MP3tunes, LLC

Another recent and ongoing case potentially impacting the digital locker and cloud computing landscape is Capitol Records, LLC et al. (“EMI”) v. MP3tunes, LLC (See Initial Complaint, EMI Summary Judgment Memorandum and Response, MP3tunes Summary Judgment Memorandum and Response, and recent Summary Judgment Ruling). Here, multiple record companies and publishers affiliated with EMI have asserted, among others, various copyright infringement claims against MP3tunes, which operates two separate online services–specifically, MP3tunes.com and Sideload.com. MP3tunes.com allows users to store their music collections in online digital lockers, which they can then access from any computer or mobile device with an Internet connection. Sideload.com is a music search engine site that allows end users to search for links on the internet to downloadable music that can be uploaded (or “sideloaded”) to an MP3tunes digital locker. Once music is placed in an end user’s digital locker, the music becomes available for transmission to any IP-enabled device at the end user’s direction.

Based on the documents filed to date, EMI has asserted a series of both direct and secondary copyright infringement claims against MP3tunes, including claims that MP3tunes has forfeited its eligibility under the Digital Millennium Copyright Act’s (DMCA) Safe Harbor provisions for its illicit conduct in knowingly providing the means for end users to violate EMI’s copyrights via Sideload.com and failing to respond to takedown notices. In fact, the majority of EMI’s claims are based on the functionality and content made available via Sideload.com, which essentially aggregates URLs linked to digital music files that can be readily downloaded or sideloaded to an online locker. EMI has asserted that the infringing nature of the links posted on Sideload.com, as well as the corresponding files that are made available via the linked URLs that are then sideloaded into an MP3tunes digital locker violate EMI’s copyrights.

While a detailed analysis of the merits of EMI’s DMCA and contributory liability theories remain outside the scope of this post (and have yet to be entirely decided by the court), the district court, in its recent ruling on the parties’ summary judgment motions, did find that the MP3tunes was entitled to the Safe Harbor protections afforded under the DMCA, but further addressed a key issue emerging in the new cloud-based lockering environment. Specifically, upon receipt of a valid takedown notice from EMI, the court found that MP3tunes had a duty to not only remove links to infringing songs publicly displayed on Sideload.com, but also a duty to remove songs stored in users’ personal lockers which were downloaded from such links. In its defense, MP3tunes claimed that it was only required to remove the URL links on Sideload.com because only those links were listed on EMI’s takedown notices and that it might be subject to lawsuits by users if it actually removed personal property from users’ digital lockers. The court, however, rejected this argument, pointing to the DMCA’s immunity provisions for service providers acting on valid takedown notices (see 17 U.S.C. 512(g)), and stating that:

“Where service providers such as MP3tunes allow users to search for copyrighted works posted on the internet and store those works in private accounts, to qualify for DMCA protection, those service providers must (1) keep track of the source and web address of stored copyrighted material, and (2) take content down when copyright owners identify the infringing sources in otherwise compliant notices… [Accordingly,] MP3tunes was obligated to remove specific works traceable to users’ lockers .. [b]ecause MP3tunes keeps track of the source and web address for each sideloaded song in each user’s locker and EMI’s notices gave sufficient information for MP3tunes to locate copies of infringing song in users lockers.

In addition to the foregoing claims, EMI also claimed that MP3tunes directly infringes that right of public performance by allowing end users to stream music from their online digital lockers to personal devices. Relying in part on the holding in the Cablevision Case, EMI asserted that MP3tunes violates the public performance right because it uses a “single master” to play songs to multiple users, as opposed to Cablevision which maintained a separate copy of each program for each subscriber who recorded it. In response, MP3tunes replied that it does not utilize a “single master” storage system, but rather a common open source distributed file software system that eliminates redundancy and enables MP3tunes to efficiently store and retrieve the millions of audio files uploaded by its users without employing a duplicative file storing method.

Ultimately, the district court held that MP3tunes does not in fact use a “single master” system, but rather a standard algorithm known as “Content-Addressable Storage” to store music files which uses hash tags associated with each uploaded song that ultimately allows for the reconstruction of the exact file the user originally uploaded to the service (i.e., there is no “master copy” of any EMI songs stored on MP3tunes’ servers). Still, this determination does not entirely address EMI’s infringement claim regarding the right of public performance as the court’s holding solely relates to the nature of the specific file storage technology employed by MP3tunes. This is in part due to the fact that EMI’s arguments on the public performance issue were largely based on distinguishing the file storing technology used by MP3tunes from the technology employed by Cablevision. In other words, EMI did not address the public performance question by looking at the intended audience of the transmissions enabled by MP3tunes, but rather whether MP3tunes used a “single master” to transmit music to end users.

Ultimately, the take away from both the Cablevision Case and the MP3tunes case is that cloud-based delivery, storage and consumption of entertainment content, whether overtly and implicitly, implicates many of the exclusive rights afforded copyright holders and stakeholders need to remain vigilant about allocating risk when the laws in the US and overseas have yet to suitably address the contours of these services and the corresponding technologies at play. We will obviously keep an eye on future developments in connection with cloudifcation of entertainment content and any case law potentially impacting the future deployment of related cloud-based products and services.

The complete description of the panel is set forth below:

As the public’s demand for “any content anywhere” grows, entertainment, media and technology companies are turning to the “cloud” for innovative ways to distribute and monetize content. The movement to the cloud, however, presents stakeholders with a familiar challenge: how to formulate new business models without infringing the rights of content owners. While recent case law provides some guidance for cloud service innovators, many issues regarding the copyright implications of storing, reproducing and transmitting content from the cloud remain unsettled. Now, a host of emerging cloud-based business models — from MP3tunes, Dar.fm and Zediva to Amazon CloudDrive, Apple’s iCloud and GoogleMusic — are testing the parameters of copyright law. This panel will focus on the critical legal issues raised by the expansion of cloud computing and explore how stakeholders can balance the need to comply with evolving laws, standards and court decisions with the need to exploit new technological advancements that lead to improved services and enhanced user experiences.

For more information, and to register for COPYRIGHT AND CONTENT IN THE CLOUD, please follow this link: http://www.csusa.org/chapters_new_york.cfm, download the registration form and return it with your credit card information to The Copyright Society of New York by e-mail (amy@csusa.org) or fax (212-354-2847).

By way of background on the Hangover case, Whitmill created and applied Tyson’s tattoo in 2003.  At the time, Tyson signed a release acknowledging that Whitmill owned all artwork, sketches, drawings and photographs based on the tattoo.  Whitmill then registered a copyright in the tattoo in April 2011.  Whitmill’s copyright registration suggests that Whitmill registered Tyson’s tattoo, rather than the design for the tattoo, as the copyrighted work.  In the registration, Whitmill described the work as “Artwork on a 3-D Object” and registered it under the category of “Visual Arts”.  The Visual Arts category applies to designs where the work only exists in a single copy or in fewer than two hundred sequentially numbered and signed copies suggesting that Whitmill registered tattoo itself, rather than the design for the tattoo, as the copyrighted work.  This conclusion is further supported by the fact that Whitmill included a picture of Tyson as a copy of the work, rather than a copy of the design on its own.

The design of a tattoo is clearly copyrightable as a pictorial or graphic work under §102(a) of the Copyright Act.  However, the Copyright Act also requires a work be fixed in a tangible medium of expression in order for it to be copyrightable.  The novelty of Whitmill’s copyright claim is that it raises the question of whether a design is copyrightable when the medium in which it is fixed is the face of another person.

Recognizing copyright protection in a tattoo could grant the tattoo artist unintended control over the body of the recipient.  The Copyright Act grants certain exclusive rights to the copyright owner, which, in the case of a tattoo, could be interpreted as a form of ownership over the body and image of the tattoo recipient.  If Tyson changes the tattoo or adds to it without Whitmill’s permission, he could be violating Whitmill’s right to create derivative works.  Similarly, others who publish images or footage of Tyson could be held liable for violating Whitmill’s exclusive reproduction, distribution or performance rights, which may make Tyson liable as a contributory infringer if he authorized these uses of his image.  Because the tattoo is so famous, Whitmill may even be able to get a court order preventing Tyson from removing the tattoo under the additional protections works for works of visual art under § 106A (a)(3) of the Copyright Act.

In its court papers, Warner Bros. argued that, if the tattoo is copyrightable, its use constituted a parodical fair use of the copyrighted work.  Fair use permits certain uses of a copyrighted work without the copyright holder’s permission and, though there are no presumptively fair uses, parody has traditionally been granted broader protection under the fair use doctrine than other protected uses.  Warner Bros. claimed that the film is poking fun at the toughness and outrageous lifestyle manifested in Tyson’s “warrior tattoo” by placing the same tattoo on Helms, who plays a “timid, frightened and milquetoast dentist with a decidedly conservative lifestyle.”

Despite avoiding an injunction which might have interfered with the film’s theatrical release, Warner Bros. still faced the uncertainty of a trial and the possibility of incurring significant and unexpected costs, including the cost of digitally altering the film prior to its home video release.  However, whether it would have actually incurred those costs or ultimately prevailed is now merely an academic discussion as the case was settled.  Details were not disclosed.

In another high profile case, Sony Pictures recently defeated a copyright infringement claim in the Second Circuit Court of Appeals over the copyrightability of blow dryers as weapons in promotional merchandise for the film “Don’t Mess with Zohan”.  Novel claims of copyright protection are becoming more prevalent as developments in technology push copyright law into novel and previously unrecognized forms of expression.  This brings us to the larger concern for content producers–how to ensure that there is an adequate clearing process in place to encompass these newly developed forms of protected expression.

In an earlier post, we looked at the copyright issues raised by motion capture-based games.  Motion capture-based gaming creates one of the first opportunities for large-scale exploitation and monetization of choreographed movement as a separate work.  Whether it is a popular dance, a distinctive martial art sequence or a creative yoga position, in order to incorporate it into a game, the game developer must determine whether the particular movement constitutes copyrightable choreography.  However, copyright law does not provide a clear line between the types of movements that rise to the level of copyrightable choreography and those that do not.  The courts have not provided much additional guidance either.  If the work is copyrighted, the developer must seek the necessary licenses, as it would for the music-based interactive games.  However, unlike in music, there is no established framework for licensing choreographed works, making the game developer’s job much more difficult.

Similarly, if tattoos are copyrightable expression, content producers might have to adjust their clearance processes to make sure they’re obtaining the necessary licenses.  Previously, it may have been sufficient to obtain permission from the individual whose image is being used.  Now, content producers may want to consider whether there might be third party rights in that person’s image before displaying, altering or even making reference to it, as Warner Bros. did with Helms’ tattoo.

On the other hand, content producers have also been using novel copyright claims to protect their rights in the new technologies that have been sprouting up around their content.  Todd Blatt, a mechanical engineer from Baltimore, created a digital replica of a cube featured in the J.J. Abram’s film “Super 8”.  Within 24 hours of uploading the design to a 3D printing website, Blatt had received a cease and desist letter from Paramount claiming that the design violated Paramount’s copyright.  Creating physical recreations of on-screen objects is not a new phenomenon, but new technology makes these replicas more accurate and easier to reproduce, which means there will probably be more litigation to come over who owns the rights in this digital merchandise.

Our New Media, Entertainment and Technology practice group has extensive experience assisting our clients in understanding and analyzing the impact of new developments in the law on the design, development, implementation and operation of their respective business initiatives across all new media platforms, and we will continue to monitor these and other ongoing developments in copyright and licensing law to keep our clients informed and protected.

**  Kate O’Donnell, an associate at the firm, assisted in the research and preparation of this post.

As we suspected, the response from the entertainment community has been swift, and the company has since received a barrage of cease and desist letters from television networks, movie studios, sports leagues, broadcasters, syndicators and others in the entertainment industry alleging that the operation of the service as currently conducted amounts to copyright infringement. In response, the company has now filed a complaint for declaratory judgment in Seattle district court alleging that by complying with the Act’s compulsory licensing scheme in Section 111 “it has not infringed any of the copyrights owned by the any of the Defendants.”

We will obviously keep an eye on future developments as this complaint now moves its way through the court system and the entertainment industry’s forthcoming response.

Unlike other online content distributors, the start-up has allegedly sidestepped negotiating with the copyright holders for the license of its programming, and has instead elected to wager its future on a seemingly liberal interpretation of certain provisions of the Copyright Act (the “Act”), which permit qualifying “cable systems” to rebroadcast over-the-air television signals upon the payment of certain statutorily mandated revenues. Specifically, the Act’s compulsory licensing scheme (see Section 111) allows cable systems to carry distant broadcast signals while compensating copyright owners for the public performance of their works, without the transaction costs associated with marketplace negotiations for the carriage of copyrighted programs, and instead requires that the cable system remit a fixed portion of their revenues for the retransmission of such programming to the copyright holders. Based on statements from ivi, Inc.’s management, the company has already taken steps to comply with the requirements under Act, and is apparently taking the position that its service does, in fact, qualify as a “cable system”.

The company’s current position appears to be in part attributable to the Act’s expansive definition of a “cable system”, which includes “any facility… that receives signals transmitted or programs broadcast by one or more television broadcast stations licensed by the Federal Communications Commission, and makes secondary transmissions of such signals or programs by wires, cables, microwave, or other communications channels to subscribing members of the public who pay for such service.”  The legislative intent behind the foregoing definition and the enactment of the statutory licensing scheme over 30 years ago (decades before the advent and commercialization of the Internet) was to benefit traditional cable and satellite companies operating in a heavily-regulated industry under the jurisdiction of the FCC, including a slew of rules and requirements under the Communications Act, such as programming exclusivity, sports blackouts, network non-duplication, signal quota, must-carry, and others.  The statute was not designed to provide a means for Internet-based services like “ivi tv” to avail themselves of the statutory licensing scheme by labeling themselves a “cable system” on the one hand, while at the same time finding refuge from the corresponding restrictions on MVPDs under the Communications Act because the regulation of programming retransmitted via the Internet falls outside the scope of the FCC’s jurisdiction.

This approach has been attempted before, albeit unsuccessfully.  A similar start-up, iCravetv.com played an analogous tune in 2000. Hailed as the first service to put a broad range of ordinary TV stations on the Internet–from the Simpsons to Major League Baseball games–the Toronto-based service launched to international press and huge amounts of Web traffic. They too made similar arguments regarding the contours of compulsory licensing under Canadian copyright law, but failed to quash a swift petition for a temporary restraining order initiated by United States movie studios, television studios, sports leagues and broadcasters and the iCraveTV.com service agreed to permanently shut its doors.  Notably, the petition for the temporary restraining order called the business venture “one of the largest and most brazen thefts of intellectual property ever committed in the United States.” 

Since the iCraveTV case, the U.S. Copyright Office’s Register of Copyright has repeatedly reiterated that the compulsory licensing scheme under Section 111 of the Act is inapplicable to Internet transmissions:  “..[T]he section 111 license does not and should not apply to Internet transmissions” and that “if there is to be a compulsory license covering such retransmissions, it will have to come from newly enacted legislation and not existing law.”  Most poignantly, the Copyright Office has explicitly stated that it opposes any circumstance (as in the case of “ivi tv” or iCraveTV.com) where “any online content aggregator would have the ability to use a statutory license to sidestep private agreements and [be] free from any of the limitations imposed on cable operators and satellite carriers by the Communications Act and the FCC’s rules.”   In fact, the Copyright Office openly opposes an Internet statutory license that would permit any website on the Internet to retransmit television programming without the consent of the copyright owner, stating that “such a measure, if enacted, would effectively wrest control away from program producers who make significant investments in content and who power the creative engine in the U.S. economy.”

In addition, the Copyright Office has also warned that any possible expansion of the statutory licenses to the Internet will implicate and may contradict certain international obligations, including various bilateral and multilateral trade agreements that prohibit statutory licensing of television signals over the Internet.  Specifically, the U.S. has obligations under the Berne Convention, the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), and WIPO Copyright Treaty that relate to broadcasting and Internet transmissions, including several free trade agreements with foreign nations which contain the obligation that “…neither Party may permit the retransmission of television signals (whether terrestrial, cable, or satellite) on the Internet without the authorisation of the right holder or right holders, if any, of the content of the signal and of the signal…”

Against this backdrop, even if Ivi is able to successfully defend any copyright infringement claims and challenges to its current position regarding the applicability of the compulsory licensing provisions under Section 111 of the Act, we suspect (and Ivi has even suggested) that, like  iCraveTV, the company may be on the wrong end of a barrage of claims asserted by television networks, movie studios, sports leagues, broadcasters, syndicators and others in the entertainment industry alleging that the operation of the service as currently conducted amounts to and/or results in unfair competition, tortious interference with contractual relationships, trademark infringement and dilution, false designation of origin or false representation with regard to sponsorship or authorization, etc. Additionally, until and unless Congress decides to amend the Act to clarify the legislative intent concerning the scope of the compulsory license under Section 111, any challengers to the law will need to be in a position to withstand the full weight of the United States entertainment industry which drives a substantial portion of the U.S. economy.

We will obviously keep an eye on future developments in connection with this fledgling service and the entertainment industry’s forthcoming response.

Whether a dance routine or a martial arts demonstration, legal protection for the majority of athletic movements that will be incorporated into the forthcoming wave of motion detection-based games will likely fall under copyright law’s definition of “choreography”–a form of artistic creation which secured copyright protection in 1976 when the Copyright Act (the “Act”) was amended to include “pantomimes and choreographic works” (17 U.S.C. 102(a)). Prior to that time, choreography could only be protected under copyright statutes to the extent embodied within another copyrighted work that was eligible for protection. Although the Act extended protection to “choreographic works”, it failed to define the term and what types of movements qualified as same. Other copyrightable forms, including “architectural, audiovisual, literary, pictorial, graphic and sculptural works, motion pictures, and sound recordings” are defined in the Act, but “choreographic work” is the only copyrightable form whose meaning is left unclear. In fact, the House and Senate Reports surrounding the Act indicate that Congress’ decision not to define “choreographic work” was deliberate, as legislators believed the meaning to be “fairly well settled”. In fact, the only guidance provided by Congress with respect to the category of “choreographic works” was that it does not include “social dance steps and simple routines.”

In the absence of guidance from Congress or the copyright statutes on which activities qualify for protection under copyright law as “choreographic works”, the U.S. Copyright Office (the “Office”) offered a more technical definition of “choreography” in its Compendium of Copyright Office Practices, stating that “[c]horeography is the composition and arrangement of dance movements and patterns usually intended to be accompanied by music.”

While instructive, this interpretation is not binding on the federal judiciary, and there is little case law defining the precise scope of “choreographic works”. Moreover, even if the Office’s interpretation of a “choreographic work” does not capture the essence of certain athletic movements, the fact remains that the Act’s enumeration of copyrightable subject matter is not meant to be exhaustive, and is prefaced with the statement that “[w]orks of authorship include the following categories”; and since the Act defines the term “including” as “illustrative and not limitative,” the fact that Congress did not specifically list all athletic movements that fall within the realm of copyrightable subject matter does not mean that they are not covered (just as, for example, the absence of programming code and computer programs from the Copyright Act has not prevented the courts from finding same to be well within the range of copyrightable subject matter). Further, a separate category of copyrightable subject matter known as “dramatic works” also provides some applicability to the extent the athletic movements portray a story or narrative through action, but the underlying movements, which themselves are devoid of story, would not likely find refuge here if separated from the corresponding story or narrative in the context of an interactive game.

While some athletic movements remain close enough to the Office’s definition of “choreographic works” or “dramatic works” that they should be afforded copyright protection (e.g., figure skating, rhythmic gymnastics, synchronized swimming, etc.), there has been, in recent years, a push for the copyrightability of other athletic movements under the guise of “choreographic works.”  For instance, Open Source Yoga Unity v. Choudhury, specifically addressed the question of the copyrightability of yoga moves (see 2005 WL 756558 (N.D. Cal. Apr. 1, 2005).  While the court did not settle this question, it held that it is at least possible for individual yoga positions to be “arranged in a sufficiently creative manner” to merit copyright protection. In Ahn v. Midway Manufacturing Co., a district court held that dancers who performed martial arts routines for a software developer that later incorporated the routines into the “Mortal Kombat” video game did not become joint owners of the copyright in the game only because they assigned their rights to the copyrights pursuant to a work-for-hire contract (see 965 F. Supp. 1134 (N.D. Ill. 1997)).  The court deemed the martial art performances to be “choreographic works” and stated that these “choreographic works were all original works of authorship [and] choreographic works fall within the subject matter of copyright.”  In fact, in Baltimore Orioles, Inc. v. Major League Baseball Players Ass’n, the Seventh Circuit held that “[baseball] [p]layers’ performances possess the modest creativity required for copyrightability” (see 805 F.2d 663 (7th Cir. 1986)).

Based on the foregoing decisions, there may not be a significant enough distinction between a kung fu sequence, a skateboarding demonstration set to music and a figure skating routine that would warrant extending copyright protection to one and not the others. Ultimately, though, determining which choreography or movements actually fulfill the statutory criteria, and which on the other hand are too commonplace to qualify as copyrightable subject matter, will require a case-by-case, fact-specific analysis. That being said, as the above discussion indicates, it is certain that to qualify for copyright protection, an athletic movement will have to evince a certain degree of complexity and original expression, and routine-oriented athletic performances are more likely to warrant coverage as they generally embody sufficient amounts of artistic expression and each move is specifically choreographed and designed for repetition. As one commentator described, a sport like football, even where each play is diagrammed and practiced to some extent, depends more upon the interaction and improvisation of the participants throughout the natural course of the game. A running back, for example, may go fifty yards for a touchdown, eluding opponents, breaking tackles and navigating through the defense on one play, but the next time that play is called, he may fumble the ball or be tackled for a loss of yards. A figure skating routine, on the other hand, has a repetitive nature to it; the skater will often perform the same routine countless numbers of times with minimal variations.

Once the determination is made that the athletic movement likely falls within a class of protectable subject matter under the Act, the next step is licensing the rights for inclusion in the interactive game. The clearance process for music-based interactive games, for example, relies on a well-established framework with the licensing arms of the major labels, publishers, performing rights organizations and other collectives serving as long-standing clearing houses for securing rights from multiple artists and writers. However, there are no analogous industry clearing houses or collectives for licensing choreography rights and each applicable copyright, together with any corresponding moral, publicity or privacy rights, need to be licensed from the individual owner.

In fact, this may well be the first time that movements deemed “choreography” under the Act, whether in the form of modern dance or complex wrestling moves, will be exploited and licensed as individual works on a large scale–separate and apart from the play, the music video, the movie or even the person through which it entered the public consciousness. In other words, in order to develop an interactive title based on choreography on an operational level, each individual movement will need to be reperformed and recast by professionals and technicians who will recreate the movements in a green screen-reminiscent environment using motion sensors that will allow advanced computers to precisely track a new range of activity, in particular depth-based movement, which will then be digitized and incorporated into the video game. This process will ultimately allow for the comparison of the professional recreation against the end users’ movement on a television screen and allow the game to rate and track performance, alter difficulty settings, offer training functionality, etc., all of which have become standard functionality in interactive titles. Having now extracted and recreated the choreography as a stand-alone artistic creation, the publishers and developers of motion detection games will need to begin the process of securing the rights to those popular movements crucial to a successful gaming title.

This is where the legal confusion begins for licensing athletic movements and choreography. As an example, consider the implications of the inclusion of modern or popular dance into a motion capture video game. Dances have never been the subject of lucrative licensing outside the realm of dance companies and on-stage performances because dancers were often placed at a severe disadvantage for demonstrating ownership of copyrights. As a result, attribution and credit for a dance in the dance community is frequently not equated with ownership of the copyright given the lack of economic incentive in establishing and maintaining an accurate chain of title. In these muddy waters, who holds the necessary rights required to license the dance? The music label that owns the music video? The artist who performed the dance? The artist’s choreographer who conceived of the dance? Is it jointly owned by contributing dancers and the artist? Was it created pursuant to a work for hire agreement or within the scope of employment without an agreement? Was the dance based on a pre-existing dance which could invalidate ownership? Was the dance created outside the United States thus leaving the creator with moral rights over the work that cannot be assigned? Was it previously performed and recorded on stage or in dance studio, so that the movie studio or music label is left without ownership outside of their movie or video?

The foregoing dance hypothetical is just one example of the complications associated with one form of athletic movement destined to be incorporated into motion capture games. Once the worldwide popularity of a new line of these games takes hold and creators of all forms of movements claim copyright protection after realizing the new found economic value of their works, legal disputes over the nature of copyright and the bounds of statutory protection will force the courts to take a series of bold moves–ones that can be repeated.

As always, we will keep an eye out for developments in this area of the law, particularly as the technological bounds of interactive gaming continue to expand with the introduction of gesture-based gaming.