Kids entertainment law update
Episode 167 for it's May 1 2024. Here we go.
Hello, everybody and welcome back to another episode of Entertainment Law update from Los Angeles, California. I am Gordon Firemark,
And from the Dallas Fort Worth Metroplex I'm camera bin it.
And this is our podcast about entertainment law where each month we pull together a round up of legal and business news stories and share our opinions and commentary and analysis and chit chat and and try to have a good time with it all
And here we are. How are you today, Tamma? Oh yeah, I am doing great. I'm just giving the heads up that my allergies are like,
Wild and crazy. So,
I'm drugged up maybe that's what I'm saying. Time to party. For some reason my screen goes blank. You know, I don't know. Maybe I had to leave the building for my allergies or I'm sneezing.
That could be. I could. Okay.
If I disappear. Alright. Well, things here in LA are good too. No, no complaints. The weather is starting a warm up.
And the insects are starting to show up again and all that kind of fun but everybody's good. So, glad to be here.
We do not get cicadas here in the in the desert. Okay. Check it.
But you know, mosquitoes and and crane flies are a thing here, you know, crane flies. These giant, it look like a mosquito but they're about an inch and a half.
Hey this is not a show about what is it called insect study insects.
Outside my ears. Yeah. Well, we thank you our listeners for being here with us and tolerating our
Attempts at chitchat,
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Dot com. And we have a busy episode for you today. We are,
Gonna talk about a couple of big cases and we have a lot on the AI front. So, I'm calling this episode, is it?
Real or is is alive or is it something else? So.
Let's just start with some it's it's medium big news I guess you say we talked about it what a year ago when the case broke the top gun maverick situation,
And there's been a motion for summary judgement granted in favor of Paramount pictures in this case brought by the widow of
A hood your no the writer of the article top gun back in 1983
That detailed the experiences of F 14 pilots and their radio intercept officers during their training that Paramount pictures had purchased,
An option or they bought the rights to that article and then they made the original movie Top Gun that was suggested by
Article. The original feat film featured fictional characters at the Naval Fighter Weapon School that was depicted in the article by UNA as well. So,
2018 rolls around and the plaintiffs had sent a notice of termination of the grant of copyright.
Transfer rights. That was effective January 24 2020. And then the Maverick movie that the sequel to Top Gun was released
In 2022 or so without giving yonae any credit at all now the top gun maverick movie was set 30 years later after the original top gun where the
The lead character Maverick was now a test pilot training class of graduates and the court had to grapple with sort of two issues the big one was whether there was copyright infringement and also there was a breach of contract claim
so on cooperate infringement the really the only dispute was weather or not
The top gun maverick was had striking similarity or or substantial similarity with
The original article and the court decided not really they said the article itself was a non fiction work that detailed up how pilot and his,
radio intercept officer were shot down by their instructor and the cast system and history of the school,
And the intense nature of the training all of which was depicted in the film but the the original film was a worker fiction which
With those fictional characters and now the sequel film was also a work of fiction starting with the character of Maverick disobeying orders, getting recommended, and then,
Having to train a group of graduates.
The important mission and there was drama about the relationship between Maverick and his former Rios the son who was now unable aviator and ultimately,
The court looked at it and said look the the school the naval aviator school top gun is a real fighter pilot school and the factual elements
Embodied in the story are not protected under copyright law and the general plot ideas were not protected as well,
And then the court moved on to the breach of contract analysis saying,
There was no bridge of contract because the production occurred after the termination of those motion picture right so there was no longer a contract in force essentially the film was not produced under that assignment of any rights the movie came out
Following the termination and there is language in the contract that said,
In the original agreement that made it clear that nothing in that agreement would prevent a party from doing anything that any member of the public could do. So, in theory, a studio like universal a different
Production company could put out another movie about the top gun naval maybe it are training school and that wouldn't infringe any right so paramount could do the same thing,
And so summer judgment granted in favor of paramount as yet we haven't seen whether there's an appeal of anything.
But looks like paramounts off the hook on this one.
So I thought it was interesting the court talked about that the article back to the 80s was written in a non linear fashion
From a time perspective. Oh, interesting. Forwards and backwards, different,
Again about different people and the so the timeline didn't go in a linear fashion but that Maverick top gun isn't a linear fashion and that was one of the things that they yeah obviously the
Defense argued that distinguished that substantial similarity I I really thought it was
I guess two thoughts on this these statements about the termination and they're being no contract so evidently the studio is not fighting the copyright grant termination because they determined it probably didn't give them.
The rights they got out of that article probably weren't helpful anymore. Well, I think at the time, it was
In in New York. The decision to
Option the article may have been just sort of keep it out of the hands of everybody else and and sort of way claimed to that name top gun even though that's what the school is called him they may have not needed them even back in the 80s except that it was more expedient to
Do that to get the rights and and frankly maybe the right thing to do. Hey, we've read your article. We loved it. It inspired us to make this movie,
Let's make a deal but the sequel is based on the original movie
Night on his article and I think that's the court came to,
Yeah. Yeah, I mean, I just, it's, it's interesting because clearly,
Talking Maverick is a driver of the first movie but what the decision on is that it's not a top gun maverick is not a drive it yes
I think that's an accurate way. Yeah. Participating. So, so good news for the lovers of the Paramount films and.
And not so wonderful for the family of your name but I think it's the right decision in this particular instance
And I believe there's talk that there's a third.
Oh. Third in the series. Alright. So, we lost Katie. Yeah, I know. I'm too.
Okay. Well, we mentioned we've got a lot to talk about and we've got a lot on the AI topic today. So, we're going to just jump right into AI and talk about your home state,
Tennessee and the Elvis act do you want to take this story
Sure. So, and and I've actually been doing some back and forth between here and Tennessee. So, I was in Nashville when this.
Past. So, it was some exciting news all over the news. In the in the Nashville with music business, but anyway, Tennessee just passed a new bill, titled the Elvis Act, short of ensuring lightness voice and image security
Act of 2024 it amends their prior state write a publicity law as we've talked about a bunch of times write a publicity is not federal,
Right. It is a state by state.
So it didn't mean they're 1984 act and it takes effect on July 1 2024 the Elvis act establishes strong protections related to individual voice image and lightness against unauthorized artificial
Tissue intelligence derived from deep
Fakes and voice clones kind of the summary of the main changes is adding a person's voice to the scope of write a publicity protection in Tennessee I thought that was interesting with it
Thing. Music City USA. That's how it was in there. But definition of voice as protection to simulation of an individual's voice which means simulated or AI generated replica of another individual.
Protected so it can be a sound and a medium that is quote readily identifiable and a tributable to a particular individual
Regardless of whether the sound contains the actual voice or simulation of the voice of that
Individual. Gives broader protection against unauthorized use of a voice likeness as long as it is for purposes of advertising without the use being an item of commerce. So.
Purpose of advertising products merchandise goods or services is the amendment to the act or for purposes of fundraising so listing donations anything you're trying to sell something or make money from,
As well as giving us a civil action ability for violation of this act
And a new claws of cause of action as well when someone creates an AI model or platform for users.
To create a I generated photo, voice, or lightness with the knowledge that it will violate the act. So, not only an individual right but also AA,
Cause of action to go against these platforms that I don't know maybe this will help,
Hey broaden the act.
I have some concerns about that part because you're essentially saying you look you made the software you're liable and that sort of gets us into the Sony beta maximalisis and you know does it have other legitimate uses,
But I guess that knowledge component maybe the work around there,
Maybe. It also adds AA section specifically for recording artist where they are allowed,
To Sue over commercial use of their voice and and giving some rights if they've assigned
That right to a record label where a person has entered into a contract for an individual's exclusive personal services,
As a recording artist or an exclusive license to distribute sound recordings that capture an individual's audio performance and
An action to enforce that right set for maybe brought by the person or the individual. And there's some exemptions for news, public affairs, sports broadcasting.
That's listed in the plot.
Present law the new bill adds a list of exemptions to the extent that such rights are protected by the first amendment for comment criticism scholarships satire purity
Or fleeting or incidental. So, they're they're trying to carve out the first amendment has some
Flexibility. And these kinds of things.
So I this is the first to my knowledge this is the first state law that's passed and is going to be enacted specifically addressing the AI concerns we're we're going to talk about
This whole section over things that are happening at the federal level or are trying to happen at the,
On on AI and deep fakes. Well, you know, California's law does have the word voice in the right of publicity statute. So, but but it doesn't say specifically simulated voice but there is the case law about,
You know, Bet Middler and Tom Waits and and that line of cases saying. And Johnny Carson, correct? I think so. Yeah. Yeah. So.
Just to be really clear though you know because I've heard some talk about chatter among folks about this and I just be really clear this would not prevent someone from
Doing like a parody video where they have a simulated bora audio assimilated voices and there's that that one of the of Johnny Cash thing and I'm a barbie girl.
Oh yeah if you haven't heard that it's it's hilarious because it really sounds just like him and,
You can, you can find that on YouTube. There's actually a whole YouTube channel dedicated to there's one of Simon and Garfunkel singing. I like big butts. You know that kind of thing. So, but you know, for humor and and parody sake, that
Still first Amendment protection is going to come into play. So, this is really aimed at that commercial use, the kind of thing that essentially hurts the economic interests of the artist,
And so as we move through our conversation I I made a note and I'll circle back to it as we get to own into our stories about
How maybe some of these standards of parody which is really,
The parody has to make fun of the original. So, even if John and Cart, they're using Johnny Carson's,
AI white. Is it truly a parody? Well, the question that becomes it's a parody of what is it of Johnny Carson or is it of the song or the or the
The sketch that he was doing I think both those would qualify but if they're just making fun of something else and making it sound like it was Johnny Carson doing it probably not,
It's probably not.
Yeah.
When I talk to clients about what purity is and isn't.
Yes that's changing the lyrics it's not just making funny lyrics to,
Right? Country standard. So, that's a copyright analysis but we would apply it I think to this.
Write a publicity first amendment maybe even some unfair competition times it's arguments and and there as well
You know, parody is parody and we've got I think pretty solid definitions from the what the two live crew case and then those kinds of things that pretty do a pretty good job or articulating where the boundaries are for parody. So,
Right?
Well, there's a federal statue in the works. The generative AI copyright disclosure act was introduced in the house on April 9.
By California representative Adam Shiff the bill requires AI developers to send notice to copyright holders of any work that they've used in training in AI program and that notices to be sent at least 30 days
Before the A. I. Program is made available to the public. So, it's the it's the AI not the output that we have to think about. The proposed law would require,
That anyone who creates or altars of data set used for AI training to send a notice to the register of copyrights with a
Detailed summary sufficiently detailed summary of any copyrighted works used and that would essentially provide the owners of those copyrights. I guess a chance to object and maybe opt out.
Currently there are folks that are looking for,
Reparations for use of their works in training these tools are facing uphill climbs in the courts and so the supporters of this bill say they
This could be a step toward protecting artists, writers, creators, of all sorts and to provide for some model for compensation and and less of this outright,
Taking I guess you could say the house also has the no AI fraud act which would effectively create a federal writer publicity enabling individuals or rights holders to sue over
Unauthorized use of a person's likeness or voice but this is the the generative AI copper at disclosure act is more about.
Require me some transparency so there are two twin lawsuits also centering on this,
I want to describe her as AI's shadowy copyright management and that's taken from an approach in the case of the intercept media inc versus open AI and raw story media versus alternate
No I'm sorry also versus open AI we covered that in last month's episode in both of those cases the plaintiffs argued that the AI took steps to conceal the copyright infringement by intentionally removing,
Copyright management information the authorship authorship but information those kinds of things,
And all of this sort of reflects the the European Union's open A excuse me AI act
Which requires disclosure also abusive copyrighted materials and so on so,
Lots of backing from trade groups in the IP industries music industry the human artistry campaign saga so on and so forth and the other
Entertainment industry union. So, we'll get some pushback for sure and we'll be watching to see what happens in congress. I think congress has trouble
You know, deciding what to have for lunch, much less what to do about the law these days. So, yeah. Forget.
Who knows?
I I think it's interesting. It feels a little bit while I.
I told you so,
I'm I'm okay. I don't know. It's like a almost this kind of notice for a compulsory license for a mechanical license. If I give you the information, it's all going to be okay. I I can't quite figure out how it gets us where we want to
How it would get the content owners where they want to go I agree I think all it does is open the door to maybe some
Earlier litigation asking for injunctions or something like that but we still have to make a case for why it's not,
Fair use why it's infringement. Why not accept what to do that? I also want to bring up we talked about this. I guess it would have been in the
Probably fourth quarter of 2023 which was the deep X accountability act introduced in September 23.
And and nothing has happened on that since the introduction. So, it looks like we've got kind of pending as the generative AI copyright disclosure and the houses know AI fraud act and we'll see if
Anything else comes up at the federal level.
And here we are. It's an election year and you know, they're they're bigger fish to fry and and frankly more posturing to do on other hotter topics.
Then, all of this. So, I don't expect much to to happen and you know, if it does great and we'll see but I agree that the disclosure isn't really the issue. The the
Prohibition on doing this without permission or consent is is where we need to have.
Mortif in the law, I think. At least, that's the argument that the copper and industries want. So, interesting that they're supporting it but,
Maybe it's better you know something's better than nothing kind of an approach there,
And and I guess I know where that just added in some light breaking things on the no fakes act which had seen it earrings yesterday so that's another right,
Third prong to the component of what's happening at the federal level. Yeah, yeah, we'll get to that story in a couple of minutes. Yup.
Let's move on to the story about Saga and the record companies they've reached this deal over AI in recordings.
Back in eight early April, a billie eilish had and, and another couple 100 musicians had signed an open letter.
For a I developers to respect the rights of artists and ensure that they get a fair deal from the AI generated music,
Platforms and and paradigms and some of the world's largest record labels have now reached a 10° agreement with Zag after.
Covering the use of AI generated voice impersonation and that's still waiting for the union to be ratify you to ratify the members to ratify the rule Sony Warner Music Universal in Disney have made a commitment to,
Some consent and compensation requirements. It's interesting that it's sag after and not AFM and a Beth
But what is it that you know act via all those others federation of musicians and after a covers
The actual focal talent.
You know, it is sag after. I just remember, I don't know how all the administration plays out that I think they work together from an administrative stamppoint.
And and their sister unions with the other unions yeah
Yeah. Anyway, under the agreement, record labels would need this clear and conspicuous consent from copyright owners covering minimum
Copyright owners interesting covering minimum compensation require
Requirements and specific details about how they intend to use any recordings. So, that's on the ingestion side before the, you know, the training of AI's and things. Pretty similar to what the studios agreed to,
The movie studio is agreed to with Sag after last year so the union is is holding the line on that and then doing a good job of it it sounds like,
Some of what I had read that maybe the again this is Voice Talent for
On the video film production side. That maybe they weren't so happy with what the union agreed to for them. So, if this is mirroring, mirroring it.
That's easy for me to say. Yeah. I'm going to dig in deeper as I'm concerned about how this plays out for my clients and also making sure that the labels are honoring this.
Yeah, that'll be the trick one.
Well, meanwhile, we are hearing lots of stories about,
AI generated, you know, deep fake audio recordings of of artists
Who didn't actually collaborate, collaborating, or who are now deceased, you know, doing it.
Performances with living people on time. So, yeah, it'll be interesting to see what those labels do and the artists on those labels who have been trying to do this kind of thing. Well.
We have another AI story here the check courts have weighed in on the question of copper eye protection for AI generated or AI assisted works in this case the plaintiff had generated an image using the program dolly,
The prompt was create a visual representation of two parties signing a business contract in a formal setting like a conference room or a law firm office in Prague and show only their hands so the plain of subsequently generated took this
Generated image, put it on a website, and then the defendant took it from the website, put it on their own website
And the planet objected on the basis that they were the author of that generated image and demanded it be withdrawn and and distribution be stopped without their consent and took them to court
And the key issues were weather that image is even eligible for copper eye protection whether the person created the prompt,
Based on the AI could be considered the author of that image for the purpose of coppery lawn. The municipal court in Prague said no. Only a natural person can be the author of a copyrighted work and since the AI is not a natural person.
The AI can't be an author it has to be the unique result of a creative activity of a natural person,
And unless the creator can demonstrate that the generated image is the result of there unique creative contribution it's not a work of authorship
So, no copyright. Yeah.
Hey Facebook I think so far it's just China and Vietnam would have said differently.
I don't remember the Vietnam dude. I heard something about that not long ago that there there was and it didn't go as far as China but it was you know.
Basically saying yeah there are scenarios where the crafting of the prompt can be the act of authorship or something along those lines
So, I have this whole thing of, okay, so they've said that but then how if how do I enforce still enforcement rights? If you're outside of,
If you created something in the US that would then be infringed in China.
Probably doesn't help. Our folks too much. Maybe it helps someone in China but who's infringed here but not the other one. Not the other way around. It's not the other area.
So I I anyway I jumped the gun on the on the third prompt. Well let's target. Legislation but the no fakes act senate judiciary committee hearings yesterday. I on April 30 I plugged in a link to the C Span
Video I don't know how long cease span leaves those videos at but it's active for right now if you want to go watch that 2 hour hearing and
Report back. Yeah. That'd be great but FKA twigs testified on April 30 before the senate committee about the dangers of unauthorized used of AI to mimic an artist style and personas. She herself developed a
A deep fake over the past year to explore using AI for marking purposes and to get ahead of others who may want to misuse her likeness.
Twiggy are a twig argued sorry Twiggy I'm dating myself just a little bit.
Sorry. No one, no one under 50 is going to get that, but all of our listeners.
Listeners and viewers over 50 will appreciate that Twig argued that AI technology threatens artist identities and livelihoods if their voices images
Art can be replicated without their consent. She sees this as exploitation of creators during a major technology shift. Huh?
I feels like every time that happens much like artists have been exploited in the past by innovations while she
She continued with that. Well acknowledging AI is created potential if controlled by the artist Twigs,
Plans on urging the committee or did urge the committee her written statement was released ahead of the hearing to enact regulations protecting individuals artist work
Their voices and lightnesses from being co opted harmfully by AI without permission or
Compensation.
In the future of AI landscape. So the no fakes act which is this third prom. We're talking about is.
Proposed federal legislation aimed at protecting individuals from the unauthorized use of their voice image and lightness in digital replicas including deep faith.
Aches and voice clones it's also known as the nurture originals foster art and keep entertainment safe act and it was introduced back in October of 2023 and we're just having some hearings here in end of April
So eh the goal is to create a federal writer publicity and as we just discussed earlier we don't have one of those. Everything is state by state. Some
Saying voice image and lightness as we've just learned not mentioning voice some acrobal state laws during a person's lifetime in Texas,
The statutory writer publicity is effective after death even though you can,
In for some of those state rights through misappropriation in Texas we don't have an active
Write a publicity law. During the artist life. So.
I don't know. What do you gotta add to that? Gordon, what do you think?
So I can hear you and I'm very animate see you animatedly discussing but I can't hear you.
That's because I had to cough and I muted my microphone. So, what I was saying. So, wasn't my allergies, folks? It was. Very animated.
Animatedly responded to my prop. No, that's it's nice that I had a rehearsal for what I'm about to say again now. I
I was questioning how does the federal government get into an area that has historically been subject of state regulation and,
I mean like you know I guess there are situations where congress just decides okay it's time for us to occupy this field and either declare that this is a federal question kind of a thing.
You know, using what the commerce clause probably, something like that, but I challenge whether that's the whole,
How they can regulate trademarks is if they're in interstate plumbers. So, yeah, I don't see them declaring that suddenly, this is part of copyright law or something like that. Therefore,
You know, has its own statue or constitutional authority but,
You know the the real question is does Congress even have the will to come in and do this and and does that send a message in other areas of law? That are hot button issues around.
You know, where where the power of the states and the power of the federal government, the federalism question. So, I don't hold a lot of hope that a federal law like this.
Comes in to play anytime soon but it's I'm glad we're talking about it and and it's reaching the public stage in this way. Right.
You know, crafting AA complaint. You can use their certain provisions of the trademark trademark at Liana Mag that can be used sort of like a writer publicity.
Cause of action as well as the state law causes of action,
And maybe just because who the players are in this now it gets more interesting.
And I would think the technology side,
With much rather get this address in one law versus potentially 15 that's a good point that's good point so that lobby may actually step in and say,
Okay we'll we'll go for it here's what we need and yeah I should say you know as pessimistic as I am about congressional action happening at all any subject really,
This act is by partisan sponsored bill in the senate the no fakes act and also the house bill,
The no AI fraud act which is similar and and covers things in much the same way. It's also bipartisan. Equal number of Democrat and Republican sponsors. So,
Maybe my pessimism is misplaced in this instance,
Or maybe not. It's great to, okay, so how many years have we been,
Joyfully hosting the podcast together. This is our 15 year anniversary episode.
We started in April of 2009 and this is now welt May 1 but this is technically our April episode four 2024,
Hey Facebook in and happy anniversary to you because as
Everyone knows I'm not the technical genius behind this program.
Questions about myself now too.
15 years. So,
If we went back to the year number one we were discussing will the world congress overhaul the copyright act?
You're right. And we've held out no hope. And it hasn't happened.
But what we're seeing is again as these it's kind of this guacamole as the issues pop up and was it last episode or the prior one it's been since the first
2024 that,
You know the congressional reviews related to non-fungible tokens came out and said we don't need to update any laws related to NFT. So, you know, we're having these hearings on AI.
Are the current federal law sufficient to deal with AI. I guess that's really the question that's gotta be answered and if it's not,
Then we'll congress act to in by enacting a law that they believe is sufficient to deal with AI.
Well, that is the big question is it? Yeah. It's not going to.
Oh well I've expressed my point of view the pessimism that I was talking about well 15 years we've been talking 15 years about the copyright act having a major overall,
Either one of us have the bandwidth to go back to look at
All of our listen for all of our predictions on that point. You'll like it some point, I said, within 10 years, we'll have a major overhaul.
Maybe. Yeah. Didn't happen.
It didn't happen. I think we do need it at some point and you know, it's just a matter of of having a.
A system in Washington that works and that isn't just about the political posturing and setting up the you know the table for the next big election.
Positioning. I'm not going to get too political here but
Anyway, let's talk about this 10th circuit decision involving well, it's interpreting and using applying the warholve
Foundation for the visual arts versus Goldsmith case. The Supreme Court's decision has now reshaped the landscape and copyright law particularly fair use and transformative views doctrine. This case is white monkey productions,
LLC Timothy Seppy versus Netflix and Royal Good Productions. Seppy is a former videography at the Gerald Wayne
Directive zological park recorded he recorded a video of Joe exotic delivering a eulogy
Joe exotic from the Netflix TV show Tiger King and that video was live streamed on the,
Joe exotic TV YouTube page and then stayed there after the funeral for a while. Netflix, featured a clip from the video and a segment of the tiger king show that was about a minute and six
Seconds long. That video was taken after Seppy had terminated his relationship with the park and there was.
And thus it was determined not to be a work made for hire so seppy is the owner of the copyright and the footage the district court initially ruled in Netflix's favoring
Looked at fair use and disn and then the circuit court took a look in disagree by applying the fair use the four factors outline in the copyright act
First off, the purpose and character of the use, the circuit court rejected the notion that the use was transformative.
Focusing on the commentary that did not critically engage with seppy's work work but rather focused on Joe exotic and the court said defendance use the funeral video to illustrate mister exotics proported megamaniah cole
Excuse me.
Easy for me to say. Reported Megalomania even in the face of tragedy and by doing so to fedence for providing a historical reference point
In exotics life and commenting on his showmanship. However, defendants used to not comment on mr. Seppy's video,
That is being it's creative decisions or intended meaning. War hall has deemed such a use to not be sufficiently transformative. So this departure from
The Campbell versus Acoro's music case highlights a shift towards a stricter interpretation of transformative use,
Secondly the court acknowledge that the nature of the copyrighted work favored the defendants as the video was factual and previously published on third on the amount of substantiality prong the portion taken was insubstantial,
Relative to the work as a whole and that also went in the defendant's favor and on the fourth factor the effect of the use on the potential market circuit court found that the district court
Excuse me, these, yeah, the appeals court found the district court's analysis, lacking, emphasizing the defendants burdened to demonstrate minimal market impact.
Again signaling a stricter standard for fair use determinations ultimately reverse the district court's ruling and further look at the fair use factors that fourth one gets me,
I'm not sure it's a wrong decision overall but is it really the defendant's burden to prove minimal market impact?
Well, hey, I guess it is on a defense. The fair uses a defense so you have to prove, you know, no, no, significant market impact. Okay, fair enough. So, who here we probably will see this again unless they reach a
Settlement. Yeah. They kicked it back down but this is where I was mentioned earlier.
This begins to feel like that parody standard of it must comment on the underline work.
To be able to fit within this this fair use factor in any transformation factor.
The Warhol case said the world case looked at whether or not they were created for essentially the same purpose magazine illustration,
Purpose and character but it does transformation fall under the factor
That purpose and character factor even though again in the last 15 years we've discussed a whole lot that transformation is kind of become the fifth factor. Well that's the way the Supreme Court characterized it as tying into that first factor in particular
Right? But it's funny. I was teaching
Fair use in in my class the other day and I sort of dawned on me that you know the first and second factors the purpose and character of the alleged infringing use and the nature of the original I I find myself wondering did they characterize it as nature of the original just so they weren't also saying,
Versus the purpose and character of the original.
Because if you look at the way it seems to be going maybe that's really the point is let's just say it differently so we're not conflating the two but ultimately whether it's transformative is,
Comparing the purpose of the original verses with the the purpose of the new. Well, I I think that is what what is happening in the drink information
So, how close are you stepping? How close is the new work?
Yeah, if they're the same purpose, in purpose of the previous. Yeah. So, maybe it's not really a fourth factor, a four factor. It's really three factors.
But you know how close the church the first two and added this transformation layer into some of the the deeper thinking copyright scholars would maybe go back to look at it
The opinions from the
40s and 50s that dealt with fair use what was that learn at hand and and that group of jurists. Yeah. Couldn't love somebody named Learn at hand.
That's a judge. Yeah. I miss the alcohol. You're listening. Thank you. Yeah. We're making up that name. But we're not.
He was the grandfather of Mr. Hand from Fast Times at Richmond High,
Okay.
I've been working on genealogy and,
You know,
We have a lot of names beyond learning hand that are going to southern names in my genealogy but we won't we won't go down that path. So, topic for another day. Hey, that's right.
Everybody dies. Yeah. Well, you may remember a 6 months or so ago.
Artist Sam Smith and Normani had sued and won a case over their hit dancing with a stranger and now their case they've had some
Not so great luck on the attorney's fees side of things. Federal judges denied their request for
An award covering their legal expenses. The stars claim that that was more than $700 thousand and here in the Central District of California, Judge Sue.
Has dismissed that part of the case he determined on March 18 that it was so with the case itself wasn't so devoid of merit
As to necessitate penalizing the plaintiffs with payment of the substantial legal fees Smith and Normani,
Contender that they shouldn't be held responsible for hefty expenses they had to incur in defending against what they seemed what they deemed a frivolous and unreasonable loss. So I'm sorry so I I had the facts wrong. They didn't they were sued for infringement and they won.
And then ask for their attorney's fees and they said look it was merely a gamble by the planets.
Hoping for a significant payout and the judge disagreed saying no there was no evidence of a malicious intent by the plaintiffs and so the point of send that case songwriters Jordan Vincent Christopher Miranda and Roscoe.
Claim the dancing bore a striking resemblance to their 2015 track of the same name so they they they pointed the hook and chorus about songs being similar as well as the title and,
Ultimately, the in September, the summer judgement motion was granted, and,
But the judge said, no, you know, there was a plausible case there. So, no attorneys fees for you. So, yeah.
Defend them to it back and said yeah but should you set all these things in your decision that would make us think in this wasn't it,
Uplawsable claim and it was as far as the judge pointing out prior art that quote contains nearly 20 references to the term dancing with a stranger.
I don't know even the judge saying the arguments had generic reasoning and ruling in favor of a much smaller recovery of legal cost. Yeah. So, they did get their cost but,
Well, I don't know. $10 thousand, I think. Versus 700 1000.
On the planet side and this is just me speculating.
Is this a potential commentary on even as a defendant we need to get our legal fees reindeer,
In the pending case. Well, I mean it sounds like it. I mean, you know, it'll be interesting to see if there's an appeal here. I think the standard of review for these kinds of things would be abusive discretion, right? So, let's help me,
And it then it sounds like he the judge made his reasoning pretty clear
In the ruling no evidence of malicious intent it wasn't frivolous and unreasonable so you know hard hard to say but what is that $700 thousand represents what a couple of 1000 hours of lawyers work
To defend to a summary judgment ruling. So, no trial happening,
No appeal yet or anything like that. So, that that does seem like a lot of money.
I think that's something that defendants do need to be mindful about. Mindful of? Yeah. Yeah. You know, on the other hand.
And I feel like I just read this yesterday and sorry
Too much allergy medicine I guess. And another case where the recovery and I think it was the plan of actually prevailed and didn't get there.
Attorney's fees. They just got the cost and the judge going through a similar.
Analysis. You know, I I think. Yeah, I mean, I think from a public policy perspective, there's there's something here to the notion that you know, I know a ruling like this.
Kind of stimulates settlement. I mean, they could've gotten out of lawsuit for 150 1000 bucks. If they lost the lawsuit,
With intentional willful infringement there the damages would have been in that wealth unless there's actual damages but statue damage is 150 grand so does that mean that you get sued and it's cheaper to offer a settlement than to defend,
Even though you know it's a frivolous case. This is bogus. Come on. It's ridiculous. So.
Pursue that I I
I still struggle with,
Dismiss also some copyright claims on motion for some rejuvenate even though I know it can yeah.
Well, I mean, I guess if you have the experts lining up and saying, no, they're really not that similar.
Yeah and sorry I wish I had made that as I'm looking at my notes I didn't write that case down because that that case that I was reading that we had discussed in earlier episode actually did hinge on the,
On the experts. Yeah. And making the ruling at the motion for some rejuvenate. So. Well, you know, the question is material issue of of tribal fact.
And if if the experts are sort of lining up saying, well, it's not really that similar. Then, it's asking the judge to just interpret what does that mean in terms of infringement or or you know, any of the other elements of the case, I guess. But,
Yeah, it's 700 g. I mean, if the the defense cost them more than they would have had, maybe would have had to pay and,
Well, their profits would have been the issue in that case, wouldn't it? Right. I think so. I think so. And then we don't want to set that up for every time. Oh, just sue me and I'll pay you the,
Yeah. So, it's actually dangerous. Maybe another area for the overhaul of copyright statue to address the defendants.
Right to attorney's face. Okay, so I do want to just correct myself as far as changes to the copyright act in the last 15 years. We have had one major change. Yeah.
The small claims court. Right.
Now you know I I think we hopefully they'll issue another report as to how effectively it's working. Right. But,
Shall we take credit for that since we were talking about it in the past 50 we should take we will take credit for all successes.
But yeah so you know I I look in again one of these things on the maybe think about it as we're talking about attorneys feeding images because you know had this
Be gone through the small claims court that was from the KSAC damages would have been
Capture a much lower amount of money but clearly these report damages exceeded that. So.
No. And you know, so so they gambled and lost but at least they didn't have to pay out the attorney's fees, the other side. So, I I guess that sort of the cost of doing business when you're a big star with big
Famous records and things but it will be interesting to know how much did the artists actually collect in
In their share of record royalties from these albums after recruitment of recording cost and marketing and all that stuff whether or not they're actually not losing money on the song. Or not.
But that's conversation for another day. Exactly. Exactly. Well, we have one more,
Message or story to share with folks and and it's been big news in in many business arenas these days that there's the,
Federal trade commissions non compete bam that was announced on April 23,
The FTC has made this rule and it's actually a 570 page PDF document to make a rule
That really only needs 10 pages or so or less in the in the code of federal regulations. So, it I was amused because as I was scrolling through these 570 pages I landed on one of the pages that was the heading was cup,
Federal paperwork reduction act notice.
You know what? While I'm watching the 2 hour hearing. Yeah.
What multitask? Well, I'll help you. 500 pages. I'll tell you the first 561 pages are
Preferatory material explaining and look it's legislative history stuff so it has its relevance here and there but the text of the actual rule starts on page 561 of this 570 page document,
And what the law does or the rule when it goes into effect they have to,
After project that forward about 120 days after publication in the federal register for to be,
I've become a part of the code of federal regulations but
But it adds sub chapter J to title 16 of the CFR starting at section 910. Now, none can beats have been illegal and uninforceable in California for,
And a half.
Yeah so a long time yeah I I thought it was hot the whole 7 year thing in California well there's a 7 year statue on personal service bindings personal service contracts but
In an employment contract, you can't tell the employee. Hey, after you're done here, you can't go work for our competitors.
And the law has been revolving an evolving in Texas and obviously very very narrow and scope. Yeah.
Until I actually kind of love it when I see.
Prior to this but when you would see an employment agreement come across that had this just egregious ten-year non-compete and I'm like let me just tell you,
Let's don't negotiate this because it's dark. Never going to be enforceable. So, let's get everything else we want and just
Know that they can never enforce that. Yeah. It can make us too yet but it's not a forceable. So, we've talked about this states rights versus federal rights and here is an example of where,
The federal trade commission is,
Preempting all state laws related to not compete.
Over interstate commerce and labor and employment.
Areas although states also have labored employment law in effect so this is interesting and and it's not gone with without challenge but,
What the law will do is essentially prohibit the use of,
These non-compete clauses in employment agreements. It's a retroactive band which means any existing non-competes will be valid
From the moment the law takes effect and there are just a few small exceptions senior executives with non competes
Those will remain in effect but no new non-compete clauses for senior executives. It does not apply to if you're selling your business and promising not to compete against the company you used to own,
So that's still a valid. That makes sense. Yeah. Yeah. And it doesn't apply to certain kinds of banks and health care businesses and stockyards. So, interesting health care businesses because that's one of the areas that I see a lot of.
Doctor agreeing not to compete against their former practice when they move to a new practice and things like that,
But the consequences, this is what's interesting. The FTC is actually going to impose fines, penalties, and junk to relief.
On employers that continue or try to use these non-compete classes and you know look it it's already a non-enforceable provision and it might even render the entire contract void if it's not handled
You know, correctly. So, the fines and penalties is pretty significant. The federal government's going to come after you and say, wagging your finger, okay? Pay up.
You used one of these closets. You know, you pulled out an old contract form from a file somewhere and oops. Now, you pay a fine. Right. So,
Companies have to pay attention to this. It also requires that note that employees who are currently bound under an existing non-compete.
Must be given notice of this change before the rule takes effect and it actually includes the note there
Yeah. Practice actually includes the specific language of the notice. So, there's just a model notice. Hey, they'll the government has changed the rules. They're still no longer replies. So, be your advice. And.
One of the interesting things that I've noticed is it doesn't have an impact on trade secret law. So, if you haven't NBA, that's still in effect and
A lot of NBA's really have the practical effect of preventing you from going and working from your competitors because you take the knowledge you gain on the job with you and so competitors will still be,
Maybe reluctant to hire people who worked for the other company you know because they'll get sued for the transfer.
This is a conversation I often have with with my clients who are you know maybe they're not quote in the entertainment field. Yeah.
Content or whatever they're they're business area is is you know you were maybe they've got sales people.
Yeah. It's like even if that sales person is not under a non-compete, under Texas state law, they have a duty not to disclose.
You know, this competitive information. Oh, even in the absence of a non-disclosure clause.
That's right. You can't under under our state. Just state common law.
You're the duty of non-disclosure of confidential and proprietary information,
I mean because that makes it sense it's proprietary as property. Yeah. That's right. So if I have a method for sales formula or marketing.
You can't go take that to the next employer now and you can you know take your comment sense nobody's stopping that I I always love pre who out before I even thought about going to law school.
My sister, this was when she was in college, went to work with a daycare, and they wanted her to sign a non-compete that she'd never go work for another daycare.
You know, so even at 20, she was like,
I might signing that. You know, so you can see at that level, that's a very egregious. You've gotta. Yeah. Hourly wage person. You know, non-enforceable. So, here's what's interesting on these estimates.
The FTC says that putting this band in place is going to mean more innovation an average of 17 1000 to 29 1000 more patents each year
I don't know how they're coming up with that but I guess they think individuals will be more likely to pursue a patent but yet,
Well, that's interesting. I don't know because if you're employed to date,
We don't we aren't patting on your shopping for both of us,
But typically the inventor and the employer are listed on the patent application so not sure how that number anticipating would be people leaving their employment and then
Patenting something they,
You know, in their own name, as an independent, but if you, that's where the NBA is coming also. If you develop something partly while you are working for a company.
And then you use it for your own benefit. Isn't that a violation of NBA languages? What happened? But interesting. It also says two. Seven increase in new.
Formation of startups and this probably ties into exactly what you're saying. The person says, gosh, I'm going to leave and go start this new business because this is my idea. And I'm going to implement it.
This amazing skill set that I now I can use as a consultant privately and and provide the same thing to 12 different
Companies. Hi, you're earnings. This was interesting. Typical workers earned $524.
More annually. I can see I can see that,
With greater mobility of employees because now I can go work for competitor the company wants to keep me there maybe willing to pay me more,
That's true. That's true. And it's it's interesting. You and I talked about before we added this to the rundown. So we want to give it hat tip to,
Michael Plazer, right? Michael's the one that kind of sentences. I think he goes. Thank you, Michael. Sorry. Yeah.
Hey how does this kind of apply and and I think it really is just good information for us to have is we advise.
Individuals, small businesses, larger businesses who as you mentioned, this has a retroactive effect. Yeah. That
People may be subject to one of these that it's going to go away or the business has maybe operating
With the top that these are going to be enforceable forever or at least for the term that was drafted in the original signed document and they only need to be given them a heads up that's
Not going to be the case any longer. Yeah. Disconnecting them with employment law attorneys that can advise them.
Appropriately on what to do next. Yeah and and you know it's important to remember that even though California seems to be the the
The hub or at least a hub of the entertainment industry. There are plenty of entertainment businesses outside the the state of California and Texas. Where,
They have used non-disclosures with writers and designers and computer programmers and folks like that that that
Had that non-compete language in their contract. So, now, they're those folks are a little more mobile in their employment.
Prospects and can start competing companies and things. So, I don't know if it's going to really change. I mean, being in California, I've always sort of taken the view that not competes or dis favored and I'm not going to
Go for it. Although I haven't a few instances just said, well, you live in California, you're working in California. They're never going to be able to enforce that.
Now it's nice to be able to say that sort of about it more global level
Right in along my lines of it's a 10 year non compete and you're at this level. Hey, it's not going to happen. You know.
It's just going to be unenforceable. So, back to my political pessimism for a moment. I do have to ask does this FTC rule survive if
Mister Trump becomes the president again or does that new administration come in and say no no no no put that away
Take that away Can they undo the regulations I don't know the answer that maybe thinking along the lines of if Mister Trump
It becomes President Trump once again that he's,
Lean towards avoiding the business world.
Right, is this not been official to businesses and as such we need to remove it. Yeah. I don't know.
Yeah, be interesting to watch.
Hey while I often wish I
I've been a child of this
Date. A teenager of the 60s. There's a part of me that's kind of glad I wasn't a teenager of the 60s. Well, if you take a look at what's going on around college campuses right now, it's looking a little bit like the 60s, isn't it?
A little bit like us reading. Yeah, I've been comparing it to. I wasn't old enough to understand all of that happening around the Vietnam War and now,
I'm trying to wrap my head around what's happening right now so yeah it'd be I need to have this conversation with someone who was a college student,
Yeah. Well, I was talking to my students earlier this weekend. We're at a very small arts college. You know, the very small student body and they're not having these conversations. They're just
But now I've got more to think about than this. I, you know, but then, at UCLA yesterday, we had violence and yeah, you know, so,
It's it's a little bit like I have had this conversation with my mother during age.
She adds more children at home during the Vietnam war.
Yeah. She's like, I was so busy raising my kids.
In living, you know, that life that,
She just wasn't as aware and tuned in obviously at the university so much being more available on Facebook. But again I think it is the best comparison analogy we have is to what's happened on campus then to what's happening now. Yeah.
And the civil rights movement. In the civil rights movement, obviously, yes. Yes.
Anyway. Well, man. Wait, wait, wait, wait, wait, wait, cover, what's up, thanks?
Yeah. Anyway, that is it for our episode this month. Entertainable update.
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Yeah. You can find me. My website T Ben@Law. Com or create Protect. Com both of those will take you to the same spot. So if we've been doing 15 years of podcasting
Then I think I probably got 17 years of blogging.
I so just think you create project takes you to that so social media most sites I'm at Tamara Benette.
Thank you so much for always including me and for a great 15 years. As we've
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