IPSC, day two, breakout session 4: long presentations

Jim Gibson & Christopher Cotropia, Copyright's Topography: An Empirical Study of Infringement Litigation

Presented by Jim Gibson

Deep dive into cases filed 2005-2008 so they could study terminations.  17,119 total (based on coding by others who check boxes; if they checked TM box and not © then the study wouldn’t pick those up; made some attempts to fix that).  Sampled 1077 cases, allowing 0.95 confidence level even for subsets.  112 cases complaints weren’t available, and 7 weren’t copyright.  Of 958 left, 510 were filesharing cases; wanted to focus on run-of-the-mill cases rather than a campaign that was concentrated and was dying off even then.  Could be that the media companies were filing these instead of other cases, though. Other big subset: music publishers/PRO cases, 62 of them, which we do consider run-of-the-mill, nonunique cases.  386 “other” cases.

Haven’t run regressions yet or compared much (literary works v. nonliterary works).  Looking for correlations to explore, assumptions to test.

Coded for party size; most litigation that’s not filesharing has a small firm plaintiff (under Fortune 1000 or subsidiary); those are even more likely to be the targets, 70% of the time.  Goliath rarely sues David in nonfilesharing cases; 5.7% in just the catchall (non-filesharing, non-PRO cases)—which is the same percentage of David suing Goliath.  Big media is not a major player by number of cases, though they may bring impact litigation.  Only 15.29% of non-FS, non-PRO cases. They rarely sue each other and rarely sue individuals.

Subject matter, using §102 categories (though that lumps software with books): most popular non-FS category is pictorial/graphic/sculptural works (34%), literary second (28%), and architectural works 3d (between 7-9%).  Similar with plaintiff’s industry: biggest category is industrial design plaintiffs, including architectural firms (15-18%) and clothing/textiles (over 10%) (not so much fashion design as fabric design).  For teaching, this makes limiting doctrines perhaps more relevant—useful articles doctrine.

Is copyright litigation different from other litigation? How contentious are the cases?  “Hard orders”: judge actually has to figure something out/make a decision or issue a default judgment.  This looks like other civil cases, about 50% of the time in both. But there tend to be more such hard orders in any given case that has one—4.3 instead of 2.3 in the average case.  More docket entries than average, too, though dockets are fuzzy because of differing practices.  Trial rate was 3.8% compared to 1.4% for all civil cases in Hoffman’s study.  Copyright seems more contentious.

Termination: we think they mostly settle: settlement, 30%, agreed judgment, 15%, voluntary dismissal about 33%.  That’s higher than other civil cases.  Median pendency is a bit longer in copyright but not by much.

Implication: litigation is for the fringe; raises questions about breadth of impact of litigation reforms. But they may essentially be doing small claims now.

Commentator, Paul Heald: He thinks self-selection bias in litigation can’t be overcome. This study does the best job possible of avoiding that by not limiting itself to published opinions and going to dockets. This is still just the tip of the iceberg for copyright disputes.  Consider the YouTube Content ID program—more than 1000 (allegedly) infringing uploads on YT every day—those disputes get “settled” in a day or two.  The video gets taken down or monetized or left alone, and that’s how disputes arise; we can’t learn any of that by looking at litigation. This isn’t a criticism of the study but rather a contextualization of its relevance.

Digital Rights Corp. settlements: contracts w/movie studios and publishing companies, and when you get a nasty letter accusing you of infringing downloads, before suit is filed, letter directs you to DRC and asks you to pay some ($15 per movie or thereabouts) and you get a printed document saying the dispute’s been settled. Maybe in this context PGS works aren’t all that important.  (Though what will students need to know about how to work this system?)

Hypothesis driven studies: we think malpractice litigation is booming/costly, so we study it; likewise patent litigation.  Gibson is aware that he has data waiting for a hypothesis to test.  Study period is too short (four years) to show effects of changes in law on litigation over time.  But it is wonderfully careful selection and coding, with solid random sample of large size and high internal validity. Personal curiosity: what about criminal cases?  Other topics of investigation: who are the attorneys handling these cases? In-house, small-firm lawyers, etc.?  Disputes between big companies: their absence suggests a large part of the dispute picture is missing.

Any relationship between Copyright Office filings and lawsuit filings percentagewise?

Other interesting results: secondary liability 36% and DMCA 4%.  TM claims in 30% of cases, breach of contract in 17%; fits into industrial design narrative—outside the pure creative works context.  May make sense to become more familiar with thin copyright.  Defendant answered in a little more than ½ the cases.  Is the difference in percentage going to trial significant? Thinks this may be true in tax cases too—is idealism at work on the part of the defendants?

60% ask for willful damages, and 1% get them.

Gibson: selection bias—a lot happens in the shadows/clearance culture.  It’s easy to get to the wrong result in that shadow market. 

Lunney: maybe architectural cases are more common because they’re worth bringing: in the absence of timely registration, actual damages might still be worth litigating. Likewise fabric.  Many copyright claims are valid, but have damages in $5-10,000 range which isn’t possible if your lawyer isn’t working pro bono. 

Gibson: that’s compelling, but sometimes the real payoff is to get an injunction against a competitor’s use of a logo on a T-shirt, squashing the competition.  Sometimes a doctor’s office sues another over an ad that looks too similar, so it’s not a revenue generator in itself.

My suggestion: attempt to figure out what percentage are timely registered. Gibson says the data are incomplete, which I understand is a huge problem, but it’s the first question a lawyer would ask a client who got a threat and will affect everything thereafter, so any information could be really informative.  People allege in complaints that they’re entitled to statutory damages but they’re very often wrong given date of registration.

McKenna: are copyright claims addons to TM claims in these 30% where they’re together, or vice versa? How are they dispersed between categories?

Gibson: PRO and filesharing cases are cookie cutter, so we don’t need to revisit them and could code the others for this. Anecdotally, it’s a good mix from the ones he’s coded. Bad breakups between licensors and licensees.

McKenna: useful to know if it’s a kitchen sink complaint.

Lunney: may be basis for federal jurisdiction (McK notes that Lanham Act will do it too).

Further discussion: secondary liability often brought with primary liability not independent.

 #2 Room 205

Haochen Sun, Living Together in One Civilized World: Why Luxury Companies and Consumers Owe Ethical Responsibilities to the Poor

Commentator: Jeremy Sheff

Sun proposes ethical responsibility initiative for luxury brands to distribute information about antipoverty programs.

Comments: how will this be initiated/enforced? Government intervention?  How will we make luxury producers comply? Perhaps use of carrot of increased TM protection or stick of lowered TM protection might be thought to induce brands to confront consumers with pictures of starving children; his guess is that not too many retailers will take that deal.

Doesn’t want to break TM more than it already is.  The ethical component—are you a responsible corporate citizen—seems to have no particular connection to the factors for fame.  Suggests at one point that Tiffany v. eBay should’ve come out the other way if Tiffany were a better corp. citizen, but Sheff thinks that’s a terrible idea since that case was about competition in the secondary market.

Sun suggests that social distance is why rich don’t care about the poor—but that’s exactly what people are buying when they purchase luxury brands; they buy distance from the poor.

Real property/free expression issues. If social distance is the problem, the real issue is real property that separates the rich from the poor.  Zoning that keeps them apart.

Sun: Luxury industry has become very important to the global economy.  Barton Beebe on sumptuary codes.  Debates over increasing protection for fashion design.  Irresponsibility mentality; luxury sales are linked with bribery of officials.  Rich people spent $250 billion on luxury goods while 15 million died of starvation.

How to initiate social responsibility? Both government and nongovernmental organizations can exercise pressure.  Will luxury companies resist this? Worry about tarnishment from distributing brutal brochures?  He doesn’t think so because luxury companies can benefit from extra TM protection. We also need to change perception about the nature of brands—traditionally we perceive them in economic terms (100 most valuable brands), and then we also have words to describe them aesthetically. Something is missing: ethical value. It is time to discuss that. 

Ann Bartow: women control less than 6% of the world’s wealth.  Bags/shoes: seems like you’re positioning the problem as one created by women and one that women need to solve.  Why isn’t BMW the model?  In China, the luxury/corruption nexus also involves women as status symbols. If you talk about social justice, consider the gender ramifications.

Q: on refining definition of luxury brand. Banana Republic is more expensive than Old Navy: is it luxury?

A: literature has debate on this—luxury might be about exclusivity, high quality, conspicuous consumption.  Pluralism: in Africa Starbucks might be a luxury brand; in Italy it’s a denigrated brand; in the US it’s ubiquitous.