COPYRIGHT LAW 2004 Columbus School of Law The Catholic University of America Prof. Fischer CLASS of April

Sega v. Accolade: Intermediate Copying Accolade is a game developer that made and markets game software that was compatible with Sega’s Genesis console, without being a licensee of Sega. How did Accolade make sure its games were compatible with Sega’s console?

Sega v. Accolade: Intermediate Copying 1. Reverse engineered Sega’s video game programs - used decompilation to dissasemble object code to source code and created a manual that included description of interface requirements but not code. 2. Relying on information in the manual, Accolade created games for the Genesis.

Is Intermediate Copying Infringement? Did the 9th Circuit in Sega find that intermediate copying constituted a copyright infringement where copies were not made available to the public but the fruits of the copying were?

Is Intermediate Copying Infringement? Did the 9th Circuit in Sega find that intermediate copying constituted copyright infringement where copies were not made available to the public but the fruits of the copying were? Intermediate copying during the reverse engineering process would infringe even if the end product did not.

Is Reverse Engineering Fair Use Did the 9th Circuit in Sega find that reverse engineering was a fair use? How did the 9th Circuit apply the fair use factors?

Is Reverse Engineering Fair Use Did the 9th Circuit in Sega find that reverse engineering was a fair use? Yes, “where disassembly provides the only means of access to those elements of the code that are not protected by copyright and the copier has a legitimate reason for seeking such access”. Found 1st, 2d and 4th fair use factors to support Accolade. Particular concern about unfair monopolization fo market.

Sony v. Connectix (9th Cir. 2000) Issue\ here: entrepreneur reverse-engineers a console’s operating system to create a rival console that plays Sony games. In Accolade, the entrepreneur reverse engineered the operating system to sell compatible computer games. Thus the reverse engineering resulted in a product that did not compete with the reverse engineered work, whereas in Connectix, it did.

Sony v. Connectix (9th Cir. 2000) Issue here: entrepreneur reverse-engineers a console’s operating system to create a rival console - does that matter when considering first and fourth fair use factors?

Sony v. Connectix (9th Cir. 2000) Issue here: entrepreneur reverse-engineers a console’s operating system to create a rival console - does that matter when considering first and fourth fair use factors? No - both factors support fair use. Connectix’s Virtual Game Station is transformative and does not just supplant the Sony PlayStation; Connectix is a legitimate competitor.

Sony v. Bleem (9th Cir. 2000) What did Bleem do that Sony termed an infringement? Did the 9th Circuit find that Bleem’s use of Sony’s copyrighted work was a fair use? Why or why not?

Kelly v. Arriba Was Defendant's display on a visual search engine of lower resolution "thumbnails" of copyrighted images appearing elsewhere on the Internet, without the copyright owners' permission, a fair use? What about the display of the full image? Does Google’s visual search engine infringe copyrights?

Kelly v. Arriba Defendant's display on a visual search engine of lower resolution "thumbnails" of copyrighted images appearing elsewhere on the Internet, without the copyright owners' permission, is a protected fair use of those images under the Copyright Act. The court further holds that defendant's display of the full copyrighted image as part of its search engine results, either via inline linking or framing, infringes the copyright owner's right to publicly display the work. Does Google’s visual search engine infringe copyrights?

REMEDIES What remedies are available for civil copyright infringement?

REMEDIES Section 504 A. DAMAGES (either actual damages and profit OR statutory damages) s. 504 B. INJUNCTIVE RELIEF (s. 502) C. SEIZURE/IMPOUNDMENT (section 503) D. COSTS/ATTORNEYS FEES (s. 505) (PROPERTY TYPE OF REMEDIES)

INJUNCTIONS More routine than in many other civil cases Preliminary injunctive relief is generally awarded if P establishes p.f. case on validity and infringement (irreparable injury is presumed) Permanent injunction generally awarded if copyright validity and infringement are found

OTHER NONMONETARY RELIEF Impounding and destruction of infringing articles (section 503)

ACTUAL DAMAGES/PROFITS What are actual damages? (See Frank Music Case)

ACTUAL DAMAGES/PROFITS Actual damages are extent to which market value of copyrighted work has been injured or destroyed by an infringement including fair market value of licensing fee (Davis) If too speculative, will not be awarded Punitive damages are not generally awarded in copyright actions

INFRINGER’S PROFITS What profits is a prevailing plaintiff permitted to recover in a copyright infringement action? What must P prove? - see Davis case

INFRINGER’S PROFITS Prevailing P can recover infringer’s profits if attributable to infringement Plaintiff is only required to prove D’s sales that are reasonably related to the infringement Burden then shifts to D to prove elements of costs to be deducted from sales in arriving at profit. Doubt about computing costs/profits should be resolved in P’s favor.

FRANK MUSIC Had defendant met its burden in proving element of costs to be deducted from sales in arriving at profit? Why or why not? Can a copyright proprietor recover “indirect profits”? How should profits be apportioned? To what extent are joint defendants liable for an award of profits?

STATUTORY DAMAGES What are statutory damages? Can you recover statutory damages as well as actual damages and profits? Are there any prerequisites for statutory damages? See s. 412 When must P elect statutory damages? What amount of statutory damages may a court award? What if infringement willful?

DIGITAL THEFT DETERRENCE AND COPYRIGHT DAMAGES IMPROVEMENT ACT 1999 legislation raising statutory damages by 50% (See supplement)

STATUTORY DAMAGES See s. 504© Statutory damages can be between $750 and $30,000 per work “as the court considers just” For willful infringement, statutory damages can be increased to no more than $150,000. If infringement innocent, statutory damages can be reduced to $200

COMPILATIONS/DERIVATIV E WORKS For purposes of statutory damages, all parts of compilation/derivative work are to be regarded as constituting a single work

ENGEL V. WILD OATS What was the issue for the Southern District of New York? How did it resolve this issue?

LESSIG The Future of Ideas

COSTS AND ATTORNEY’S FEES See Fogerty v. Fantasy (1994) What was the subject of the split in the circuit? How did the Supreme Court rule on this split? Is Judge Posner’s statement in Gonzalez (see supplement) sound?