Thursday, September 07, 2023

Microsoft's PR agency got Gannett sued by sending it an ad for its Superbowl Ad Meter

Campbell v. Gannett Co., No. 4:21-00557-CV-RK (W.D. Mo. Aug. 15, 2023)

This is a copyright suit against Gannett for advertising-like use of a photo taken by Campbell of NFL coach Katie Sowers; the photo came from a screenshot of an ad run by Microsoft that played during the Super Bowl. The Microsoft ad was licensed by Campbell and showed the photo at about the 40-second mark. (Campbell’s lawyers are not serving her well by claiming that §106A applies to this photo, but that doesn’t turn out to matter here.)

For decades, Gannett has conducted an annual survey of Super Bowl commercials, called “Ad Meter,” through which anyone over 18 years old can register to rate commercials submitted to Ad Meter. A PR rep sent an email to Gannett stating, “I would like to submit Microsoft’s 2020 Super Bowl ad, ‘Be The One,’ featuring Katie Sowers to the USA Today Ad Meter.” The email included a YouTube link to the BTO ad and to high-resolution screenshots from the BTO ad, but the email did not include the Sowers photo (this description is a bit equivocal about whether the screenshots included the Sowers photo, but I’ll assume it didn’t). A second request followed, asking, “Can we please be included as part of the USA Today Ad Meter?”

A USA Today 2 producer downloaded the BTO ad from YouTube and then took a high-resolution screengrab from the commercial that comprised the Sowers photo. He uploaded the high-resolution screengrab of the Sowers photo and the downloaded video into Presto, Gannett’s content management system, and added tags including “USA TODAY” and “Ad Meter.”

Gannett derives revenue from the Ad Meter Platform, which included its own advertisement and sponsorship revenue. Gannett did not use the screenshot of the Sowers photo on Ad Meter, but instead on webpages promoting Ad Meter. Each publisher defendant separately determined which content it accessed on Presto to use for its websites and in its publications; their webpages that included the screenshot of the Sowers photo would have displayed ads.

Campbell sued for copyright infringement, contributory/vicarious copyright infringement, and CMI removal.

Gannett doesn’t get summary judgment on having a license even though the contract with Microsoft granted it “an unlimited (including all lifts, edits and versions) non-exclusive, worldwide, all channels, irrevocable, license to use, market, promote, distribute, copy, reproduce, display, record, re-record, electronically publish, publicly display, transmit, broadcast, telecast, publicly perform, modify, alter, cache, synchronize with visual images, create derivative works of, and/or publish the whole or part of the [Sowers Photo], in any media whatsoever (whether now known or hereinafter developed).” But this was a license to Microsoft, and Campbell argued that Microsoft wasn’t allowed to reproduce, distribute, and publish the Sowers photo as part of others’ advertising model (including news reporting). Instead, Campbell argued that she intended to prohibit further sublicensing.

The court found that whether Gannett had an implied sublicense couldn’t be determined on summary judgment. When she became aware of the use, she promptly sent a C&D. (It feels like Microsoft and its PR agency caused this problem.)

The court also rejected summary judgment on a fair use defense. There were no changes in the content of the photo itself. “Even assuming the purpose of Defendants’ use was to make the BTO ad available for commentary and criticism, that purpose itself, in the context of this case, is commercial” (citing Warhol).  And this is really bad:

Both positive and negative commentary or criticism for the BTO ad would generate attention for Defendants’ webpages and the services and products advertised there. The ultimate goal of making the BTO ad available for commentary and criticism using the Sowers photo is for the Publication Defendants or Gannett to generate more revenue for the Ad Meter service and for any other of their services or products advertised on Defendants’ webpages on which the Sowers photo was placed. (emphasis added)

Remember, “Publication Defendants” are newspapers.  A reasonable jury could find that this factor weighed in Campbell’s favor.

Factor two: a reasonable jury could find the photo “mostly creative.” Given that Sowers made history “by being the first openly gay coach, the second full-time female coach in the National Football League, and, when the photo was taken, the first female to coach in the Superbowl,” a jury could find that Campbell’s artistic choices weren’t mainly functional or informational. Although I don’t think it matters, part one and part two of those claims are completely unrelated—in fact, part one appeals only to the importance of the subject matter and has nothing to do with Campbell’s artistic choices, which remain entirely undescribed in the opinion.

Amount: the whole photo. The fact that it was used to link to the whole ad didn’t matter.

Market effect: Gannett argued that (1) it was not a market substitute because in many cases it was altered to include a play button, (2) it generated no greater likelihood of non-compensated use by others than resulted from its use in the BTO ad itself, which was on television and YouTube without attribution or watermark, (3) it was transformational, and (4) using a screenshot from within the BTO ad video as the means to view the video promotes the sharing of art and science, and the image is already contained within the published video. While this all makes sense, and Campbell appealed basically to the idea that she must have lost out somehow, a reasonable factfinder could conclude that the other factors all favored her and thus reject the defense.

CMI removal: Goes better for Gannett. It was undisputed that the Sowers photo, within the BTO ad, didn’t include any CMI or restrictive language. Campbell shifted her theory to one that the CMI was false because it attributed the ad, and thus the screenshot from the ad, to Microsoft. But false CMI is a different claim, one she didn’t bring. There was no proof that any defendant removed her CMI or distributed the photo with knowledge of its removal.

Profit disgorgement: “In a claim for disgorgement, the copyright owner is first tasked with establishing a causal nexus between the infringement and the infringer’s gross revenues.” “After that nexus is established, ‘a rebuttable presumption that the defendant’s revenues are entirely attributable to the infringement arises, and the burden then shifts to the defendant to demonstrate what portion of the profits are not traceable to the infringement.’”

In a previous case, the Eighth Circuit upheld the jury’s conclusion that the plaintiff had established a nexus between the defendant’s infringing use of his copyrighted work and its profits from the sales of the car being advertised. There, (1) the infringement was the centerpiece of an ad that essentially showed nothing but the car, (2) the defendant enthusiastically presented the ad to its dealers as an important and integral part of its launch of the car into the U.S. market, (3) sales of the car during the period that the ad aired were above the defendant’s projections, (4) the ads received high ratings on surveys that rated consumer recall, and (5) the defendant paid its advertising firm a substantial bonus based on their success.

By contrast, a previous Ninth Circuit case cited with approval in the car case, the evidence of a nexus was too speculative.  “The infringing use of the plaintiff artist’s work was featured within a collage including other content that was pictured only on one page of a multipage brochure advertising a concert series, and the plaintiff’s claim for 1.5 percent of the defendant’s total revenues was based on the defendant’s goal of generating a response rate of 1.5 percent to its brochure as a whole.”

Plaintiff’s expert identified defendants’ revenue from ads on websites containing the photograph and subscriber revenue related to the Subscribe Now feature on their websites. The websites also displayed many other photographs, news articles, videos, screenshots from other Super Bowl commercials, and other content during the time they displayed the Sowers photo. There is no way to track revenue from a single item of content, but each site that displayed the Sowers photo displayed it along with ads that paid based on the number of impressions. Plaintiff’s expert limited calculation of ad revenue for whole newspaper websites to their time displaying the photo, but didn’t attempt any further attribution. Using numbers for the websites as a whole was too speculative to establish a nexus. No rebuttable presumption arose, and defendants got summary judgment.

In addition, Campbell was limited to one statutory damages award. Even though each of the newspaper defendants were independent legal entities that made their own decisions about what to put on their websites, it’s the number of works infringed that counts. Where there’s a prime tortfeasor that is jointly and severally liable with every other defendant, that means one award. Gannett and the other defendants had a substantial and continuing connection. The newspaper defendants each use and choose content from Gannett’s content management system, and they were all its subsidiaries.  

But! There was a triable issue on willfulness, even though the PR agency submitted the ad, and even though the Sowers photo had no separate attribution or other information and thus there was no reason to believe it had to be treated separately. Campbell argued that the USA Today producer violated Gannett’s own copyright policy by downloading the ad from YouTube and taking a high-res screengrab. I don’t see how this constituted reckless disregard or knowledge of Campbell’s rights, but the court thinks maybe: “It is undisputed that Defendants are affiliates in a large, sophisticated media conglomerate that has written policies regarding copyrights, copyright infringement, and avoiding such infringement.” Thus, there was a jury question on willfulness. This seems wrongheaded to me; now everyone will have to go through an extra step of confirming that they have the rights including the rights to every individual element of an ad.

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