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  • Bay City, Michigan Shows How to Make Your Sweepstakes or Contest a Success Even When Very Few People Enter. Extending the Deadline Is Not Always the Best Solution.

    What should you do when you launch your sweepstakes or contest and no one comes to play?

    Bay City Passport Cover-1.jpgThat was the situation recently confronting the city of Bay City, Michigan. In celebration of its sesquicentennial (150th) birthday celebration, the city invited residents and others to compete for a bundle of prizes with the grand prize valued at $2,000. Entry required submission of the Bay City-issued “passport” (A promotional brochure mailed to city residents. Pictured on left.) with stamps indicating that the entrant had visited the city’s top twenty-five attractions.

    The problem. Only one person entered by the deadline. So Congratulations to the winner, native Bay City resident, Taylor Langstaff!

    Maybe “1” Is Not the Loneliest Number

    Relying on its strong media relationships, Bay City contacted the press prior to awarding the prizes. The Bay City promotion ended up receiving significant media coverage focusing on the fact that there was only one entrant. When asked whether Bay City considered the promotion to be a success despite the low participation, Deputy City Manager Dana L. Muscott responded with an enthusiastic, “Yes”. “. . . even if passports were not completely filled out, it was a great mailer for the events held in our City!” Ms. Muscott shared via email.

    The primary purpose for a promotion is to promote – as in generate positive attention for a company, organization, person, cause, or, in the case of Bay City, a city. Hence, I wholeheartedly agree with Ms. Muscott that the one-participant promotion was successful. “I actually had people from outside of town contacting me for a book to have some kind of guide to all of the [Bay City] activities,” Ms. Muscott shared with a reporter covering the promotion results.

    Now that is truly turning lemons into lemonade!

    Some Lessons for All Promotion Sponsors

    But what other options are available to sponsors whose promotions attract fewer entrants than hoped?

    Can a Sponsor Extend the Deadline? While I have not yet encountered a case directly addressing a sponsor’s right to extend a promotion deadline, here are my thoughts on the issue. If in the official rules the sponsor reserves the right to modify the rules, the promoter can arguably extend the deadline of the promotion. The right to extend the deadline is one of several rights a sponsor should reserve in its official rules. If the sponsor does not reserve these rights, the sponsor arguably waives the right to take these actions.

    But, Extending the Deadline Is Risky. It is risky to extend the deadline if the sponsor has not reserved that right in the official rules. Even with a reservation of the right in the official rules, deadline extensions are still risky – from both a legal perspective and a public relations perspective. The risk increases proportionally with the value of the prize, the number of participants, and the effort required from participants to enter. Sponsors implementing best practices will avoid deadline extensions.

    Ability to Extend Deadline Varies by State and by Type of Promotion. A state’s prize promotion laws can also impact the sponsor’s ability to extend the deadline. Some state prize promotion laws explicitly prohibit the sponsor from changing the rules. However, not all state prize promotion laws govern all contests, sweepstakes, and other prize giveaways. Like the federal Deceptive Mail Prevention and Enforcement Act which many state prize promotion laws model, some states make their prize promotion laws applicable only to certain categories of promotions that use direct mail or telephone solicitations or require attendance at a sales presentation. Other states have broader prize promotion laws that can at least be interpreted to apply to more traditional sweepstakes and contests.

  • More Lessons on How Not to Use Stock Images. Improper Use of Stock Image in HIV Ad Results in Successful Lawsuits against Getty Images and Advertiser.

    Stock images, stock footage, and stock music are fantastic resources when you need material for your website, advertisements, video productions, and other creative projects. Using stock materials can lower costs, legal risks, and administrative work – if used properly. Proper use is key as there are definitely incorrect and risky methods of using stock materials.

    HIV Ad Results in Lawsuits against Getty Images and Advertiser

    In April 2013, the New York State Division of Human Rights released an advertisement advocating rights for people who are HIV-positive. The ad featured a picture of Avril Nolan with the caption “I am positive (+),” and, “I have rights”. You can see the ad in the New York Post coverage.

    However, Nolan is not HIV positive and did not consent to the use of her image in the ad. The New York State Division of Human Rights obtained Nolan’s picture from Getty Images, a well-known stock image company. Getty Images obtained the picture from photographer Jena Cumbo, described as an acquaintance of Nolan, who took the picture.

    The incident resulted in Nolan filing lawsuits against both the New York State Division of Human Rights and Getty Images. I initially blogged about this incident in 2013. Since there has been some resolution to the legal proceedings, I thought it worth re-visiting the mistakes made by the New York State Division of Human Rights, by Getty Images, and by the photographer.

    The New York State Division of Human Rights’ Mistakes:

    Kudos to the New York State Division of Human Rights (NYSDHR) for licensing the image from a reputable stock image company rather than allowing its staff to meander the internet in search of images to cut and paste. (Some companies do that for their social media posting needs and it often does not work out well.)

    NYSDHR Mistake One. Unfortunately, no one at NYSDHR read the Getty Images license agreement. The NYSDHR staff person who made the online purchase clicked through the license agreement while downloading the Nolan image but did not read the license agreement which contained the following provisions:

    "2.6 Pornographic, defamatory, or otherwise unlawful use of [stock images] is strictly prohibited, whether directly or in context or juxtaposition with other material or subject matter. (emphasis added)

    2.7 “If any [stock image] featuring a model or property is used in connection with a subject that would be unflattering or controversial to a reasonable person”, the stock image must be accompanied by a disclaimer indicating “that: (i) the [stock image] is being used for illustrative purposes only; and (ii) any person depicted in the [stock image] . . . , is a model."

    NYSDHR Mistake Two. Several NYSDHR staff people reviewed and/or participated in preparation of the ad. Yet, none of them considered the implications of using the picture of a woman who’s not HIV positive as the focal point of an “I’m HIV-positive” advertisement.

    The Outcome for NYSDHR. Those actions constituted negligence by NYSDHR. As a result of negligently labeling Nolan as HIV positive in its advertisement, NYSDHR was found liable for defamation and for violation of Nolan’s privacy rights in a summary judgment motion (Nolan v. New York, 2015 NY Slip Op 32023(U) (Court of Claims, Oct. 18, 2015). The Court of Claims left the issue of NYSDHR’s damages for a subsequent trial.

    Getty Images’ Mistakes:

    Getty Images’ Mistake One. During the purchase process, Getty incorrectly informed NYSDHR that Nolan had signed a model release and that the image was available for commercial use.

    Getty Images’ Missed Opportunity. During the purchase process, Getty learned that NYSDHR would use Nolan’s image for advertising. However, Getty did not make any inquiries regarding the advertisement’s subject matter. Since not all purchasers are going to read Getty Image’s eight-page licensing agreement, the purchase process presents a good opportunity for Getty Images to highlight the additional steps required prior to using stock images in an ad about a sensitive subject.

    The Outcome for Getty Images. Nolan sued Getty Images for using her image for trade or advertising purposes absent any written consent in violation of New York Civil Rights Law §§ 50 and 51 (the state’s privacy laws). Getty tried very hard to get Nolan’s complaint dismissed by pushing any liability onto NYSDHR and the photographer. Getty’s arguments included the following:

    • Getty had a First Amendment right to display Nolan’s image in its database and license the image to the press;
    • Neither NY Civil Rights Law nor the First Amendment required Getty to investigate the existence or validity of every image release within its database
    • Nolan was a model and such status negated her privacy claim.

    The court disagreed with Getty finding that Nolan had a valid claim against Getty for placing her image in the Getty catalogue, especially where that photograph is ultimately used in an advertisement in a manner that created a false impression about Nolan. According to the court there were many factors that needed to be resolved via summary judgment or trial:

    • whether Nolan is a model,
    • whether Nolan signed a written release,
    • whether Civil Rights Law §§ 50 and 51 required Getty to investigate the existence of a release signed by Nolan,
    • whether the First Amendment protects Getty's exploitation of Nolan's image without Nolan's written permission,
    • whether Getty's inclusion of the image in its database of images available for licensing qualifies as use of the image for either advertising or trade purposes, and
    • whether Getty can shift to NYSDHR and the photographer the burden of obtaining Nolan's written consent.

    Getty decided not to pursue answers to those questions and settled with Nolan in January 2015.

    The Photographer’s Mistakes:

    Nolan posed for the photograph in May 2011 in connection with an article in Soma Magazine about New Yorkers interested in music. Nolan did not receive payment for the photograph, did not sign a written consent form, and did not grant permission for use of the photo for any purposes other than the Soma Magazine article. The photographer provided that image to Getty for inclusion in its stock image database.

    According to Getty, as part of that transfer, the photographer signed Getty Image’s contributor agreement. I just took a look at Getty Images contributor agreement and it does require that those submitting images to Getty obtain valid model and property releases where necessary in accordance with the Submission Requirements. It took a lot of clicking through other areas of Getty Images website to determine when those Submission Requirements deem it necessary to obtain model and property releases.

    Ms. Nolan did not sue the photographer. The photographer likely does not have the deepest pockets of the parties involved in this affair. She and Ms. Nolan might also be friends or at least social or professional acquaintances. While it appears that the photographer escaped unscathed, she likely did not strengthen her relationship with Getty Images and Getty Images might pursue her for reimbursement of any settlement feeds paid to Nolan. The Getty Images contribution agreement does include indemnification provisions.

  • Online Snarking. Is It Libel or Free Speech? Some Libel Do’s and Don’ts for Online Speech.

    With Facebook, Twitter, Yelp, online forums, and so many other digital venues in which to share our thoughts with the world, it is easier than ever to become the target or the perpetrator of libel.

    Some Defamation and Libel Basics

    Defamation law varies from state to state but there are several general, common principles. You defame someone when you make a false statement about the person and the statement harms the person’s reputation. The defamatory statement is libel if you write it down and share it with other people. When you simply speak the defamatory statement, that’s slander. Defamatory statements posted online are libel.

    To be defamatory, the statement must be false. A truthful statement – even if unflattering – is not defamatory. Similarly, a statement of opinion is not defamatory. However, do not take this as carte blanche to make any statement you want hoping to pass it off as an opinion. Merely labeling a statement as opinion does not insulate the statement from being defamatory. “I think Mr. Jones is a dishonest person,” may be a valid non-defamatory statement of opinion. In contrast, “I think Mr. Jones is embezzling money from the company,” is likely defamatory if Mr. Jones is innocent of embezzlement.

    Libel Do’s and Don’ts for Online Speech

    DO understand that you are accountable for your Internet speech. Just because you present it in 140 characters or place it in a Facebook posting does not mean you are not accountable for your defamatory language.

    DO realize that every online, negative comment about you or your business is not libel. The First Amendment protects a customer’s right to cybergripe, that is share online the truth about any bad experiences he has had with your business. In many cases, the disgruntled customer may even use a website name that mimics and parodies the business’ name – JonesConstructionIsAwful.com. The cybergriper steps outside legal boundaries only if his criticism includes false statements and those false statements harm the business.

    DO realize there is more leeway when making comments about public figures and issues of public concern. The risk of libel decreases if the real people mentioned are public figures or other people involved in events of public concern.

    DO realize the benefits of the Communications Decency Act (CDA). Thanks to this federal law, online forum operators, bloggers, and website owners are not legally re¬sponsible for libelous statements posted by visitors to their sites. This is starkly different from the offline world in which a publication like a newspaper or magazine would be liable for printing a reader’s defamatory comments.

    DON’T think you can hide behind anonymity. While you have a First Amendment right to speak anonymously, the First Amendment does not make it okay to violate someone’s rights. A person you libel online may be able to uncover your identity by serving a subpoena upon your internet service provider.

    DON’T think eliminating or changing names is sufficient. The person about whom you make untrue statements might still have a libel claim even if you don’t mention him by name. The person might still be identifiable through your mention of a nickname, geographic location, physical description, personality trait, or real-life events in which the person was involved. If readers can identify the person about whom you make a false and harmful statement, there is potential risk for libel.

    Libel Versus First Amendment Protected Speech

    To place some of these principles and do’s and don’ts into context, here are comparisons of what is libel and what is not libel.

    Not Libel. “This architect lacks compassion. He doesn’t care about the needs of his customers or the community.”

    Libel (if untrue). “Don’t hire him for your project. He is on illegal drugs and has been hospitalized for mental instability.”

    Not Libel. Posting online a photograph or video of someone. (However, depending on the circumstances, the posting might yield copyright, privacy, or other claims.)

    Libel. Posting a photograph or video after adding a misleading caption or editing it in a way that negatively misrepresents what actually happened.

    Not Libel. “This firm charged $10,000 when other firms charged only $5,000. The quality of their work was not worth the extra money.”

    Libel (if untrue). “After demanding full payment upfront, this firm started work two months later than promised and delivered a structure that was not up-to-code.”

    An earlier version of this article was published in the American Institute of Architect’s CRAN Chronicle.

  • Problems with Offering (or Winning) Real Estate as a Contest or Sweepstakes Prize. Part Two.

    Part One of this two-part blog posting reviewed the legal challenges of awarding real estate as a prize in a contest or sweepstakes. This Part Two highlights a few of the challenges confronting the winner of the real estate in such a promotion.

    Initially, winning a property for an entry fee of approximately $150 might seem like a windfall. It is a windfall with a few potential downsides. If the promotion is well structured, the rules will signal many of those potential downsides.

    Method of Transfer. Often, the owner transfers the property to the winner via quitclaim deed. With a quitclaim deed, the owner transfers any interest the owner has in the property; however, the owner does not warrant or guarantee the validity or existence of those property rights. Hence, if any title problems later emerge, the winner might need to resolve those problems without any assistance from the owner.

    Liabilities and Taxes. Promotion rules often indicate that the winner takes the property “as is”. While the promotion rules hopefully indicate that there are no liens, back taxes or other liabilities on the property, the transfer documents might not include this statement or, if included, might not guarantee the accuracy of the statement. It might be advantageous for a winner to conduct a judgment and lien search on the property prior to accepting it. Otherwise, as the new proprietor, the winner might be responsible for payment of any back taxes and debts.

    Outstanding Business Obligations. When the awarded property is a business property such as an inn or restaurant, the rules often require that the winner honor any advance reservations and outstanding gift certificates. Obviously, the resulting burden on the winner depends on the expense associated with honoring these pre-existing obligations as well as the winner’s intent to continue the business – which leads to the next point.

    Property as a Going Concern. If the real estate is a business property that the winner plans to operate, a commitment by the owner to provide the winner with some consultation and/or training on running the business is an attractive promotion feature. The winner may need to obtain and pay for the permits and licenses legally required for operation of the business Existing government-issued permits and licenses do not necessarily automatically transfer along with the transfer of the property or the business. There might also be vendor relationships the winner needs to establish or continue as part of operating the business.

  • Problems with Offering (or Winning) Real Estate as a Contest or Sweepstakes Prize. Part One.

    Owners of real property – ranging from luxury homes to country inns to movie theaters to yoga studios – sometimes offer their property as a promotional prize. The promotion often follows the owner’s unsuccessful attempts to sell the property in the conventional real estate market.

    The owner’s hope is that aggregate entry fees will allow the owner to recoup the investment in the property. The winner receives a property at a cost far below the property’s value. While this result may at first glance seem like a win-win for everyone, it can cause legal and other problems for both owners and winners. I’ll briefly review some of the owner’s woes in this blog posting.

    Lotteries Not Allowed

    Charging an entry fee (known as consideration in promotion law lingo) is where the potential trouble begins. If the winner of the property is selected based on a random drawing or other chance-based method, the real estate promotion combines chance, consideration, and a prize, and is, therefore, a lottery. With few exceptions, private individuals and organizations are legally prohibited from operating lotteries. Inadvertently structuring a promotion as an illegal lottery is number one on my list of top ten legal mistakes for contests and sweepstakes promotions.

    Promotion mechanisms that are legal, depending on the state, and that might allow a private individual or organization to charge entry fees include a non-profit raffle and a skill-based contest. There are several obstacles to both approaches.

    The Non-Profit Raffle Approach

    In most states, non-profit raffles are limited to non-profit organizations. Hence, to structure the real estate promotion as a non-profit raffle, the owner must first enlist a non-profit organization as a sponsor. Other potential obstacles to the real estate owner achieving his financial objectives through the non-profit raffle approach include the facts that

    The Skill-Based Contest Approach

    With this approach, the owner awards the real estate based on the participants’ demonstration of a skill. One challenge to this approach is structuring the contest so it can withstand legal scrutiny. In some actual-world situations, state attorneys general have re-classified poorly structured real estate contests as illegal lotteries. Structural features for a real estate contest which I would label as mistakes and contrary to best practices include the following:

    No Rules. Failing to have and publish well-drafted contest rules

    Insufficient Judging Criteria. Failing to specify the skills on which the entrants will be judged and the winner will be selected. For example, in an essay contest, it is insufficient to indicate the real estate will be awarded to the writer of the “best essay”. What exactly does it mean to be the best? An attorney general reviewing the contest will be looking for clearly established and stated criteria used for evaluating the essays.

    Insufficient Information about Judges. While the sponsor does not necessarily need to identify the judges by name, the better practice is to describe why the selected judges are qualified to judge the contest. Indicating merely that "an independent panel of judges" will review the essays by may be insufficient for a contest structure to withstand legal scrutiny.

    No Stated Minimum. Failing to specify the minimum number of entries for the promotion to go forward. Ideally, entry fees should be placed in an escrow or trust account so that the funds can be promptly returned if there is an insufficient number of entries. Delays in returning money can trigger legal scrutiny and accusations of fraud.

    Part Two of this blog posting series will briefly discuss why one might not want to be the winner of real estate awarded in a promotion.

  • My Awesome Law Rocks DC Judging Experience

    LawRocksDCAn upside to being a lawyer whose practice includes entertainment law is the occasional invite to a cool event. Such was the case last Thursday when I served as a judge at a Battle of the Bands event hosted by Law Rocks at the 9:30 Club in the District of Columbia.

     Law Rocks is a nonprofit organization that organizes concerts around the globe with proceeds going to local charities within the host city. There have been Law Rocks concerts in London, Sydney, Dubai, Los Angeles, San Francisco, New York, Boston, and Philadelphia. Thursday’s concert was the first in Washington DC.

    Part of the fun is encouraging attorneys and other legal professionals to release their inner rock stars. All members from the performing bands hail from local law firms or law schools. The eight bands on Thursday night’s 9:30 Club roster consisted of Attractive Nuisance, Buzzard Point Caucus, Estoppelgängers, The Fine Print, Redacted, Splinters, Sutherland Comfort, and Tortious Tones.

    As a judge, I did not deduct points from any band for a name that some might view as mildly dorky. In fact, I embrace the dorkiness. When I form my musical group of legal professionals, we will call ourselves Boilerplate – in homage to the transactional nature of my law firm practice.

    Each performing band rocks (i.e., raises funds) for a specific local charity. A nice touch at Thursday’s 9:30 Club concert was having a representative from each band’s selected charity introduce the band as the band took the stage.

    If Law Rocks comes to your city and you have the opportunity to serve on the Rock Panel of Judges, I highly recommend accepting. The evening was a blast and Law Rocks takes good care of its volunteer judges with complimentary car service, V.I.P. seating, food, and libations.

    DCLawofRock JudgesHere’s me (Joy) with two of my fellow Rock Panel judges – blues musician Michael "JR" Tash (left) and talent agent Ray Bialek (right).

    Congratulations to Law Rocks for a successful inaugural DC concert event offering a good time to a bunch of good people for the benefit of several good charitable causes.

  • Unauthorized Product Placement Questions Raised by Lego/Artist Conflict

    Lego blocks – a child’s toy – has stirred up a political, censorship, and product placement controversy.

    Artist Ai Weiwei’s Upcoming Work

    For an upcoming exhibit at the National Gallery of Victoria in Melbourne, the Chinese artist and dissident Ai Weiwei decided to build two works using Lego construction blocks. One work tentatively titled “Lego Room” is to consist of mosaic portraits of advocates for human rights and Internet freedom including controversial figures such as WikiLeaks founder Julian Assange. The second work is to be a new version of the artist’s 1995 photo triptych, “Dropping a Han Dynasty Urn.”

    This is not the first Ai Wiewei exhibit based on Lego blocks. In 2014, he did an exhibit at San Francisco’s Alcatraz prison which work including Lego-block-based portraits of 176 prisoners.

    Reaction by the Lego Group

    Danish toymaker, The Lego Group, refused to fill the bulk order of several million blocks needed for Ai Weiwei’s project. A Lego Group spokesman, quoted in the New York Times, explained that the company rejected the order because the company “. . . refrain[s] — on a global level — from actively engaging in or endorsing the use of Lego bricks in projects or contexts of a political agenda.”

    Rights Clearance Issues?

    Questions abound as to whether the Lego Group’s non-political stance was in fact political and as to whether refusing to fill the bulk purchase is censorship. For me, as an attorney whose practice includes licensing issues, the conflict also interests me from a rights clearance and product appearance perspective.

    The questions of whether one can incorporate brand-named products arise frequently. Products with brand names have a way of popping up – sometimes unexpectedly – in artwork, film, productions, advertisements, and other media. While conservative media producers eschew the risks from the unlicensed appearances of brand-name products in their works, several United States court rulings sanction the unauthorized appearance of a brand-name product in a production as long as the appearance does not

    1. tarnish the product’s reputation,

    2. siphon the goodwill associated with the product, or

    3. mislead people to believe that the product manufacturer has endorsed or sponsored the production.

    Courts are particularly willing to accept an unauthorized product placement when used for social commentary. Perhaps no company has learned this lesson better than Mattel, the maker of the iconic Barbie Doll. According to the courts, all the following are legally acceptable:

    • Utah photographer, Thomas Forsythe, taking and displaying photos of Barbie Doll in various absurd and often sexualized positions in his “Food Chain Barbie” photo series;

    • Artist Susanne Pitt re-selling Barbie Dolls after physically altering them and clothing them in sadomasochistic attire

    • Danish band Aqua featuring Barbie Doll in a sexually risqué song titled Barbie Girl

    In contrast, featuring iconic products and their logos in non-related advertisements without a license can have dire consequences.

    Back to the Lego Blocks

    One commenter compared the Lego Group’s withholding of blocks to the withholding of paint, pens, or a camera because one doesn’t like the painting, book, or film that will be created from that material. If one considers the Lego Group’s mission statement, as shared on its website, “to inspire and develop the builders of tomorrow”, the comparison has some validity.

    On the other hand, there are distinctions between those Lego blocks and paint, pens, or film -when being used as the basis for art. Typically, when we view a painting, book, or film, we don’t necessarily know the brand of paint, pen, or film used for the work. In contrast, each Lego construction block carries the trademark, Lego, so Lego is front and center for visual works constructed with the blocks.

    Meanwhile, Ai Weiwei’s social media posts and subsequent news coverage about the conflict have generated numerous offers from around the world of contributions of the toy blocks. Hence, it appears that the artist will get the Lego blocks – as well as some “you just can’t buy that kind of” publicity – for his upcoming art project.

  • Google Books Program Wins Another Fair Use Victory

    Background

    The Authors Guild v. Google, Inc. case began over ten years ago. In 2004, as part of the Google Library Project, Google entered into agreements with several libraries to digitize books in those libraries’ collections. Books digitized included books still protected by copyright. Google displays snippets – or several lines of text – of the digitized books in Google search results. The participating libraries are allowed to retain digital copies of the books they submit with the contractual understanding that the libraries will not use their digital copies in any manner that violates copyright laws.

    For its Library Project and related Books Project, Google has digitized tens of millions of books without the authorization of the books’ publishers or authors. In 2005, the Authors Guild, the Association of American Publishers, McGraw-Hill Companies, Simon & Schuster, John Wiley & Sons, and five individual authors filed a copyright infringement lawsuit against Google in the Southern District of New York. The district court found Google’s use of the books to be fair use and granted summary judgment to Google. The Authors Guild and the other plaintiffs appealed.

    In this recent ruling, the Second Circuit  agreed with the district court and concluded that Google’s use of the books is a fair use and, therefore, non-infringing.

    The Authors Guild's Arguments on Appeal

    The Second Circuit rejected all of the Authors Guild’s arguments. Here are those arguments and the court’s corresponding responses summarized in much more simplified terms than expressed in the court’s 49-page opinion:

    1. The Authors Guild argued that neither Google’s digital copying of entire books nor allowing users to read snippets of those books qualifies as a transformative use. Court’s response: Snippets serve the transformative purpose of identifying books of interest to the searcher. In order for Google to offer the snippet feature, Google needs a complete digital copy of the books in its system. Also, having complete digital copies of millions of books within its search engine has enabled Google to facilitate new forms of linguistic research (e.g., examination of word frequencies, syntactic patterns, and thematic markers).

    2. The Authors Guild argued that the snippets function as a substitute for the entire book. Court’s response: While Google makes an unauthorized digital copy of the entire book, Google does not make the complete digital copy available to the public. Furthermore, the limitations Google places on the snippet feature – such as blocking about 22% of each book from snippet view and returning the same snippets for a searched term regardless of how many times or from how many different computers the term is searched – means that viewing a book through the snippet feature cannot serve as a substitute for the entire book.

    3. The Authors Guild argued that even though public access to the snippet feature is without charge and without advertising, Google’s ultimate commercial profit motivation precludes a finding of fair use. Court’s response: While acknowledging that fair use often favors nonprofit uses, the court highlighted that some of the most universally accepted forms of fair use, such as news reporting, are normally done commercially for profit.

    4. The Authors Guild argued that the book-related programs infringe authors’ derivative rights by negatively impacting authors’ ability to exploit search markets. Court’s response: Google’s search and snippet features allow the public access only to very limited information within the book and do not allow any substantial access to a book’s expressive content. Authors do not have an exclusive derivative right to supply information about their works of the sort communicated by Google’s search functions.

    5. The Authors Guild argued that Google’s storage of digital copies exposes authors works to hacking and piracy. Court’s response: The books digitized by Google are stored on servers protected by the same security systems Google uses for its own confidential information. The court found Google’s security systems to be “extensive” and “impressive”.

    6. The Authors Guild argued that Google’s distribution of digital copies to participant libraries is not a transformative use, and subjects authors to the risk of loss of copyright revenues through access allowed by libraries Court’s response: The libraries proposed use of their digital copies was a fair use since that use entailed making available to library patrons the same type of digitized book searches that Google offers to the Internet public. Also, the participating libraries contractually agreed to use their digital copy in a copyright-respectful manner and to take precautions to prevent dissemination of their digital copies to the public at large. Under those circumstances, Google’s giving each library digitized copies of books already owned by the library is not an infringement.

    Why This Case Has Taken So Long

    One reason, this lawsuit has continued for more than ten years is that the Authors Guild and Google reached a proposed settlement in 2009. The settlement agreement with its attachments ran 300+ pages. (The historically curious can review the 10-page annotated summary I prepared in 2009 of the Google Book Settlement Agreement.)

    One of the troubling components of the rejected settlement is that it was opt-out and not opt-in. The rejected settlement would have applied to anyone who had a copyright interest in a book that was published on or before January 5, 2009 – unless that person took affirmative steps to opt out of the settlement. Also, the rejected settlement allowed Google to make much greater use of digitized books than just snippets – in return for payment to authors. For these and other reasons, the New York district court rejected the proposed settlement in 2011 – and the parties returned to litigating the original copyright infringement claims.

  • Proof that Using Creative Commons Material Is Not Risk-Free

    One might think that using properly licensed material would guarantee insulation from a copyright infringement lawsuit. Apparently not. At least not for Kappa Map Group’s recent use of material per a Creative Commons license.

    Background of Creative Commons License Dispute in Drauglis v. Kappa Map Group

    Kappa Map Group is a Pennsylvania-based publisher of maps and atlases. In July 2012, Kappa Map published an atlas entitled “Montgomery Co., Maryland Street Atlas”. The front cover of the atlas features a photograph of the Montgomery county landscape (presumably) entitled “Swain’s Lock”.

    Kappa Map obtained the Swain’s Lock photograph from the online photo-sharing site, Flickr. The photographer, Art Drauglis, had uploaded the photograph to his Flickr account and selected the option of making the photograph available to others under the terms of a Creative Commons Attribution-Share Alike License.

    What Is a Creative Commons License

    Creative Commons is a non-profit organization offering free license documentation that copyright owners can implement to make their works available for use by others. When using material under a Creative Commons license, one need not pay a fee nor obtain direct permission from the licensor as long as one follows the terms of the license.

    There are numerous forms of Creative Commons licenses. While all Creative Commons licenses do not permit commercial use, the Attribution-Share Alike license selected by Drauglis for the Swain’s Lock photo does.

    Photographer Sues Kappa Map Group on Creative Commons Technicalities

    As permitted by the Creative Commons Attribution Share-Alike license, Kappa Map used the Swain’s Lock photograph without notifying the photographer and without specifically asking him for permission. When the photographer learned that his photo adorned the front cover of the Montgomery Co., Maryland Street Atlas, he filed a copyright infringement lawsuit against Kappa Map.

    The photographer did not dispute that he published the photograph under a Creative Commons license that authorized commercial use. Instead, he argued that Kappa Map’s use was beyond the scope of the license. Ultimately, the court concluded that Kappa Map’s use was indeed within the scope of the Creative Commons license and that the use was not infringing. In reaching that conclusion, the court rejected the following three technical arguments presented by the photographer:

    Free Distribution of Atlas. The photographer argued that Kappa Map did not distribute the atlas for free as required by the license (the “ShareAlike Requirement”). The court found that the ShareAlike requirement applied only to derivative works of licensed material. According to the court, while the atlas included the photograph, the atlas was not a derivative work of the photograph. Therefore, the ShareAlike Requirement did not apply to the atlas and it was fine for Kappa Map to charge a monetary fee for the atlas.

    Adequate License Information. The photographer argued that the Kappa Map atlas did not include adequate information about the Creative Commons license since Kappa Map did not print the url to the license on the atlas. The court disagreed determining that inclusion of a url was not mandatory and that Kappa Map satisfied the information requirement by including on the atlas back cover the notation – Creative Commoms [sic], CC-BY-SA-2.0 – which contained the license’s uniform resource name.

    Proper Attribution for Photographer. The photographer argued that Kappa Map did not provide proper attribution for the photograph. The license requires that Kappa Map provide authorship credit in a manner comparable to and as prominent as credit provided on the atlas for materials comparable to the photograph. Credit for the photograph appeared on the back cover of the atlas in 7-8 point type as follows:

     

    Photo: Swain’s Lock, Montgomery Co., MD
    Photographer: Carly Lesser & Art Drauglis, Creative Commoms [sic], CC-BY-SA-2.0

     

    The photographer argued that the material comparable to the Swain’s Lock photo was the entire 112-page atlas. Copyright notice for the entire 112-page atlas was on the first page of the atlas and was in at least 10 point type. The court found that the material comparable to the Swain’s Lock photo was not the entire 112-page atlas; but instead each individual map. The credit for each individual map was a bottom-of-the-page notation of “© Kappa Map Group, LLC”. The court concluded that the back cover credit given for the photograph was comparable to and as prominent as the individual map credit.

    Lessons To Be Learned by Licensors and Licensees

    Creative Commons Materials Are Not Risk-Free. While I view being sued by a Creative License licensor as a rarity, the other risks associated with Creative License materials are much more likely to emerge.

    Read the Fine Print When Uploading Your Material to Websites and Social Media Networks. If you care about how the material is used, don’t just blindly accept the terms without understanding their impact – which is what the photographer of Swain’s Lock seems to have done when uploading the image to Flickr. Not all online postings provide the option or requirement of granting a Creative Commons license. However, as I discuss here and here, posting to social media sites such as Twitter and Facebook typically entails granting broad non-exclusive rights to the social media website to use your material (although users of the social media site don’t always have corresponding carte blanche to use your material).

    Understanding and Complying with License Terms Is Important. While this is true of all licenses, perhaps it is more true for Creative Commons licenses since all licensors might not fully understand the rights they are granting and might challenge licensees on technicalities. From my reading of the Kappa Map court opinion, it seems that Kappa Map’s actions were certainly within the spirit and made with the intent of full compliance with the Creative Commons license. Fortunately for Kappa Map, the court found the company to be in full compliance with all the technical minutiae of the license. Other licensees might not be as diligent – or as lucky.

    Sometimes a Paid-For License Is Less Expensive Than a Free License. Using Creative Commons material is attractive because use is free and requires no direct permission from the licensor. But sometimes “free” results in substantial expense. Even though Kappa Map prevailed in the copyright infringement lawsuit, the company’s use of the Swain’s Lock photo resulted in fourteen months of litigation. The Copyright Act allows the prevailing party in a copyright infringement lawsuit to seek payment of its attorneys’ fees and costs by the other party. Courts have discretion in granting such awards. Kappa Map asked for but was not granted an award of attorney’s fees and costs.

    The case is Drauglis v. Kappa Map Grp., LLC, No. 14-1043 (ABJ) (D.D.C., 2015). As of the writing of this post, the Swain’s Lock photo can be viewed here and the Kappa Map Group atlas cover featuring the Swain’s Lock photograph can be viewed here.

  • Minimizing Risk when Delegating Company Social Media Activities. Use of Images.

    Train Staff and Freelancers in Basic Copyright Principles

    Communicate to freelancers and staff that all company social media postings should respect others’ intellectual property rights. Ensure that individuals handling the company’s social media accounts have general awareness of copyright, fair use, and other rights clearance issues – whether you accomplish that task via an in-house training session, a third party webinar, a company handbook, or alternative means.

    The copyright infringement lawsuit filed by the North Jersey Media Group (NJMG) against the Fox News Network illustrates what can go wrong when a company does not provide clear guidance to staff responsible for social media. NJMG sued Fox after Fox posted an NJMG-owned iconic 9/11 image to a Facebook page promoting the Justice with Judge Jeanine television program. After Fox's argument that the use was entitled to a fair use protection was rejected in a summary judgment motion, Fox elected to defend its use in a jury trial scheduled for early 2016. (See Note)

    Here’s how the 9/11 image found its way to the Justice with Judge Jeanine Facebook page, according to the Fox-NJMG court documents:

    A Fox production assistant held principal responsibility for managing and posting content to the Justice with Judge Jeanine Facebook page. She found and selected the 9/11 image for posting on Facebook after conducting an internet search on Google. The decision to post the image was hers. The production assistant, who had majored in journalism and media studies, had no copyright law training in college nor during her three-year tenure at Fox.

    While the production assistant had access to the legal department and had previously consulted with it regarding the fair use of photographs and videos on the television program, she had never sought legal advice for postings on the Facebook page and did not seek the advice of the legal department or anyone else associated with the program before posting the iconic 9/11 image.

     

    Encourage Staff to Use Pre-Cleared Pools of Creative Materials

    Staff persons with no copyright training should not meander the internet in search of images to post to the company’s webpage and social media accounts! Read that sentence again.

    Even images that appear to be rights free or come with Creative Commons licenses can still be problematic. With respect to relying on fair use, not even experienced copyright attorneys can always accurately predict which uses a court will view as a qualified fair use.

    It might not be possible – or even desirable – to have a legal consultation for every image to be posted to the company’s social media accounts. One potential solution is making a bank of pre-cleared images available to staff and freelancers. There are stock image libraries of all sizes with the larger ones offering millions of images.

    What’s ironic about the Fox-NJMG copyright lawsuit is that Fox may have actually had a license to post that iconic 9/11 image. Fox subscribed to the Associated Press photo bank and the 9/11 image is among the images the AP makes available to subscribers. Fox discovered this fact in the middle of the proceedings and after the deadline to amend its answer to NJMG’s complaint. The court would not allow Fox to amend its answer to add the defense of license. (North Jersey Media Group v. Pirro, No. 13 Civ. 7153 (S.D.N.Y., Mar. 2, 2015)).

    The Lesson. If you have a blanket license to an image library, encourage – or, even better, restrict staff and freelancers to using images from that image library. Companies can apply similar strategies to music and footage by subscribing to stock music and stock footage collections.

    Of course, even using stock images requires a modicum of guidance as there are definitely wrong ways to use stock images.

    (NOTE: This posting previously incorrectly reported that NJMG and Fox settled the dispute after Fox’s failed summary judgment motion attempt. While the parties reportedly came close to settlement, those discussions ultimately proved unsuccessful.)