Nothing's certain but death and taxes

And class actions, of course.

Laster v. T-Mobile USA, Inc., --- F.Supp.2d ----, 2005 WL 3610616 (S.D.Cal.)

In this putative class action, the plaintiffs asserted that defendants -- cellphone companies and other sellers of wireless telecommunication services -- engaged in the unfair and deceptive practice of charging consumers sales tax on the full retail value of cellphones that were advertised as "free" or at substantial discounts, in violation of California's Unfair Competition Law and False Advertising Law. Plaintiffs sought damages and injunctive relief under the Consumer Legal Remedies Act. Their state-law complaint was removed under CAFA.

Underlying facts: Cellphones are often sold as part of a bundled transaction: a free or discounted phone along with a service contract for a specified length of time. When the defendants offer the bundle, however, they generally charge sales tax of approximately 7.75% based on the full retail value of the phone. (For one representative plaintiff, this amounted to $10.31 in tax; for another it was $28.22.) Plaintiffs object that a free phone shouldn’t have any sales tax, and that the tax should be calculated on the discounted price when the phone is sold at a discount. I have to admit, this objection seems quite reasonable to me; I certainly don’t expect to be charged full-price tax on a sale item.

But this is a class action, so the legal analysis is not going to focus on the merits of the underlying claim. The contracts for the bundled phones, to which the plaintiffs agreed, included an arbitration clause that requires arbitration but bans class-wide claims in that arbitration. The Federal Arbitration Act (FAA) has a pro-arbitration policy, so the questions for the district court were whether a valid agreement to arbitrate existed and whether it encompassed the dispute at issue. But wait! Despite the federal policy favoring arbitration, state law controls issues of contract validity and enforceability. Generally applicable defenses such as fraud, duress, or unconscionability, may be applied to invalidate arbitration agreements, though the court is limited to determining whether the arbitration clause itself is unconscionable.

A contract of adhesion – a standard consumer contract imposed by the party with superior bargaining power – is unconscionable when both procedural and substantive unconscionability are present, though the amount of each required will vary with the strength of the showing on the other. Procedural unconscionability comes from oppression and surprise; oppression comes from inequality of bargaining power and an absence of meaningful choice on the weaker party’s side. Surprise comes from the extent to which the terms of the bargain are hidden in a wordy form drafted by the stronger party.

The defendants contested procedural unconscionability on the grounds that plaintiffs had meaningful choices – there were other cellphone companies on the market, including some that don’t insist on arbitration. The Ninth Circuit, however, has already rejected this very argument in Ting v. AT&T. Under Ting, take-it-or-leave-it consumer contracts are deemed to be procedurally unconscionable. The court reasoned that the T-Mobile contract at issue fell on the higher end of the unconscionability spectrum, since the arbitration provision was buried in a 52-page “Welcome Guide” that was only available to the plaintiff after she’d signed the contract. Cingular’s arbitration clause was a closer call – the plaintiff got the service agreement specifically mentioning arbitration at the time of purchase. Thus, it was on the low end of the unconscionability spectrum.

As for surprise, it’s clearly present in the T-Mobile contract. Though the Cingular service agreement talks about arbitration, it doesn’t mention the terms or the ban on class-wide claims; those elements can only be determined by reading pp. 10-12 of Cingular’s 13-page terms of service booklet, so a “modicum” of surprise is present.

Substantive unconscionability is the remaining hurdle. Plaintiffs argued that a contract by which consumers waive class action rights is subsantively unconscionable, based on the California Supreme Court’s ruling in Discover Bank v. Superior Court of Los Angeles, 30 Cal.4th 148 (Cal.2005). Defendants responded that Discover Bank didn’t hold all such arbitration provisions unconscionable, and if it did, it would be preempted by the FAA.

Discover Bank held a waiver of class-wide arbitration to be unconscionable in an adhesion contract when (1) disputes between the parties would predictably involve small damages, and (2) plaintiffs alleged a scheme by the more powerful party to cheat large numbers of consumers out of small sums. In such cases, the waiver becomes in practice an exemption from responsibility for fraud and willful injury. Applying this two-prong test, the court found substantive unconscionability. Notably, prong (2) is satisfied by plaintiffs’ allegations; they need not provide evidence at this time.

Gee, that test looks like it would invalidate class-wide arbitration waivers in most consumer contracts! Thus, the preemption argument. The FAA makes arbitration agreements enforceable except on grounds that would apply to any contract. Because the Discover Bank rule is not one of general applicability, the defendants argue, it’s preempted. The California Supreme Court found that, to the contrary, the determination that a class-wide bar is (usually?) unconscionable involves general principles of state law; it just so happens that those principles will often apply to this type of contract, as they might to any class of unconscionable contracts. The district court here agreed.

Defendants also had a motion to dismiss, so we do get some discussion of the merits of the claim. Under the newly amended unfair competition law, plaintiffs have to allege (1) actual injury (2) caused by the defendants’ false advertising. The court found that plaintiffs adequately alleged injury, but not causation. Plaintiffs claim to have been harmed by a variation on bait and switch – lured in based on promises of free phones, then induced to pay. But plaintiffs failed to allege reliance on the offer of free/discounted phones – no named plaintiff alleges seeing, reading, or in any way relying on the ads. The unfair competition claim was dismissed with leave to replead.

Plaintiffs’ Consumer Legal Remedies Act damages claim was also dismissed – with prejudice – because they failed to give defendants thirty days notice before beginning an action for damages, as required by law so that defendants can have an opportunity to fix the problem without litigation. Strict adherence to the notice requirement is necessary to further the statute’s aims.

Attracts deer but also false advertising claims

Wildlife Research Center, Inc. v. Robinson Outdoors, Inc., -- F.Supp.2d --, 2005 WL 3676530 (D. Minn.)

This case resulted in a judgment of $4.8 million, plus prejudgment interest, based on the defendant’s false advertising, business defamation, and product disparagement for hunting products – a human scent elimination spray and a doe-urine-based attractant. Monetary awards in Lanham Act cases are reasonably rare, but in this case the jury apparently felt that years of false advertising had taken their toll on the plaintiff, and awarded both damages for lost business and the defendant’s profits. Although the awards on the Lanham Act and state-law claims were duplicative, prejudgment interest was available on the state-law claims and was awarded accordingly.

Lanham Act recovery may include both actual damages and the defendant’s profits, though the total recovery is subject to principles of equity and must constitute compensation, not a penalty. In this case, the duration of the false claims, the damage to the plaintiff, and the defendant’s knowledge that its claims were false justified the award. In addition, though the defendant argued that recovery of profits is only allowed for willful violations of the Lanham Act, the court ruled that the 1999 amendment to §1117(a) abrogated earlier case law imposing a willfulness requirement: The law used to allow recovery for “a violation under section 1125(a) of this title,” but now it reads “a violation under section [1125(a)] of this title, or a willful violation under section [1125(c) (dilution of famous marks)].” The contrast makes clear that willfulness is not required for an award of profits in a false advertising case.

Northeast Mississippi Daily Journal, corrupter of youth?

The paper solicited youngsters to write in with their versions of the seventh Harry Potter novel. Inducement to infringe the derivative works right? They might as well have renamed their publication Newspapster!

Self-blurring?

Slate on Ford Fusion ads that look like iPod ads. This post was going to be called "Initial interest confusion, thy name is Ford," but at the bottom of the article, the reporter notes that Apple gave permission.

Ford's car communications manager says, "the iPod is so iconic that people stop to watch the ad." To which the reporter points out, "Yes. Because people think it's a new iPod ad. And iPod ads are often fresh and entertaining. When it turns out to be an ad for a midsize sedan, I imagine that people mostly lose interest." I'm not a big fan of the initial interest confusion doctrine, yet I agree that maybe this wasn't the best use of the brand on Apple's part.

In a future dilution action against one of the many businesses that use the iPod in advertising, should this be evidence that the mark is already diluted? Even though Apple granted permission, and thus there's no infringement, promiscuous use may still dissipatet he special attributes of fame for dilution purposes. (Compare to the idea of self-tarnishment, as in these dual-authorized rivalry figurines.)

I may be able to teach my dilution classes entirely with Apple/iPod examples.

No publisher liability for false specialization claims

American Association of Orthodontists v. Yellow Book Usa, Inc., --- F.3d ----, 2006 WL 162979 (8th Cir.)

The American Association of Orthodontists (AAO) is a trade association for, unsurprisingly, orthodontists, who have specialized training beyond that of general dentists. The defendant publishes yellow pages directories that list, by category, businesses and professionals who pay to be listed. Its Missouri publications included separate listings for “Dentists,” “Dentists-Orthodontists,” and “Orthodontists (Straightening-Braces).” The AAO sued for violation of the Lanham Act because Yellow Book listed general dentists under the last two categories, which allegedly was likely to confuse and deceive consumers about the qualifications and expertise of the listed dentists. (The AAO alleged that it was, among other things, a violation of the American Dental Association’s Code of Professional Conduct for a general dentist to claim a specialty without the requisite education.)

The court of appeals ruled on two independent grounds. First, dentistry is a heavily regulated profession of which orthodontics is a subspecialty. If it is not illegal in Missouri for a general dentist to perform orthodontic services, the court reasoned, finding a Lanham Act violation in this case would usurp the function of the state licensing authorities.

This seems to be missing a step – it could be unlawful for a general dentist to advertise a speciality without additional qualifications even if s/he could perform specialized services. Nonetheless, if it is legal for a general dentist to claim to be an orthodontist even if s/he hasn’t completed extra training, then finding for the AAO might conflict with the state regulatory scheme. Later in the opinion, the court refers to the lack of a state-law ban on “general dentists holding themselves out as orthodontists,” which seems to be the right standard.

Even so, it would be nice to know more about the state regulatory scheme. Though there may not be a formal requirement for further training before dentists can advertise as orthodontists, if the AAO could prove consumer deception, the state's policy might not be in conflict -- only if the state deliberately decided to allow broad dentist advertising would there be a problem. (Query whether the Lanham Act would preempt any such state rule; given the traditional state role in regulating medicine, probably not, but a state policy allowing total freedom of advertising in other fields might well be preempted.)

Even had the complaint stated a claim, the court ruled, AAO lacked standing. From a trademark perspective, even assuming that consumers would mistake a listing under “Dentists-Orthodontists” as a false endorsement or association with the AAO, the relief sought -- an injunction against listing general dentists under that category – would not redress the injury alleged, which was public confusion over whether the AAO endorses the Yellow Book listings.

Moreover, despite the broad language of §1125, most circuits have long held that non-trademark false advertising claims are limited to competitors. Even under a more expansive, antitrust-like test, Yellow Book provides only an advertising medium to individual dentists, who would be the proper defendants. As the court notes, though, this isn’t exactly a point about standing.

I'm a little surprised that there was no discusion of 15 U.S.C. § 1114(2), which provides for injunction-only remedies against publishers who innocently print matter in violation of § 43(a). Though that limitation is mostly targeted towards trademark infringement, it clearly contemplates other violations of § 43(a) such as false advertising; it limits “the remedies given to the owner of a right infringed under this Act or to a person bringing an action under section 43(a)” (emphasis added), suggesting that you don’t need a trademark “right” for this section to apply. This provision implies that a false advertising cause of action against a publisher would exist, though damages would be unavailable.

When the moon hits your eye like a big pizza pie ...

... it could be a jab from a disgruntled family member.

Rosati's Franchise Systems, Inc. v. Rosati, 2006 WL 163145 (N.D.Ill.)

Rosati’s Franchise is a family business of pizza restaurants. The corporate plaintiff has federal registrations for “Rosati’s Pizza” and related marks; it has ten director/shareholders, all of whom are family members. Frederic, Michael, William, and Jeffrey Rosati, the first three of whom are minority director/shareholders, are the defendants in this trademark and false advertising case.

As a result of disputes between the majority and minority Rosatis, the shareholders agreed to split exclusive territorial rights. Rosati’s Franchise agreed to cease franchising and instead issue licenses to each of the shareholders to use and sublicense the Rosati marks and recipes (which are claimed as trade secrets). After this agreement, the shareholders created a marketing cooperative to advertise the individual pizza stores, both existing franchises and new licensees. All ten shareholders used the cooperative to market the 140 Rosati’s.

In 1999, “a website was created” – I use the passive voice because that’s how the complaint says it – at rosatispizza.com (warning: plays music). It listed the names of all Rosati’s nationwide. A third party owned the domain name.

In 2005, unbeknownst to the majority, the minority shareholders purchased rosatispizza.com and rosatis.com from the third-party owners. Soon thereafter, the family rift became open, and the minority group’s lawyer sent a letter to one of the majority Rosatis, stating that rosatispizza.com would be revised to list only the locations owned and controlled by the minority. And indeed, the 94 Rosati’s stores franchised or licensed by the majority were taken off the site.

As a result, the plaintiffs alleged, both customers and licensees had expressed confusion and anger, which had resulted in a substantial loss of business and goodwill. Moreover, because the website was changed, they were forced to pull ads because their Rosati’s stores weren’t listed on the site named in the ads.

Moreover, at the time the complaint was filed, a message appeared on the listings for Arizona restaurants:

Note to our valued customers:

… In 2001 a second group started licensing the Rosati name to independent owner operators. Due to the high number of complaints received at this web site in relation to locations controlled by the second group, we want to make it clear that the Original Valley Owners have no ownership or authority over locations that use the Rosati name that are not listed on this web site. Any complaints for locations not listed on this web site should be directed to that location and should be resolved by the parties that own that location. We apologize for any confusion.

Plaintiffs alleged that this constituted unfair competition under the Lanham Act and violation of the Illinois consumer fraud and deceptive trade practices statutes.

The court dismissed the federal trademark claims based on the authorization granted to each shareholder, including the minority shareholders, to use the mark in connection with their own sublicensing activities. The license, however, did not allow the minority to make false or misleading representations of fact about the majority, so the federal false advertising claim survived, as did the coordinate federal claims.

This case included a standing challenge – defendants argued that the individual plaintiffs, as non-exclusive licensees, had no standing to sue. This is the rule for trademark infringement under §1114, but §1125(a) confers standing on a broader range of plaintiffs, “any person who believes that he or she is or is likely to be damaged by” prohibited conduct. The individual plaintiffs were such persons.

Brief comment: Usually, quality controls within a family business will be assumed to exist, avoiding the charge that the mark has been abandoned through naked licensing. Can that general rule possibly apply here, where it appears that one segment of the family has no control over the other? The existence of this litigation shows an attempt to monitor the use of the marks under the license; perhaps that’s enough. But the reviews at epinions suggest that consumers might not understand the convoluted ways in which this franchise has developed.

Farmed salmon: under the pink

Gallego v. Wal-Mart Stores, Inc., 707 N.W.2d 539 (Wisc. Ct. App. 2005)

Gallego filed a class action complaint against Wal-Mart for misrepresenting the origin of salmon and failing to disclose that the salmon was artificially colored. The trial court dismissed the complaint. The court of appeals affirmed in part and reversed in part, allowing one of his claims to proceed.

Gallego alleged that he bought artificially colored salmon from a Wal-Mart because he believed, based on the color, that it was “naturally raised or wild” rather than farm-raised; farm-raised salmon allegedly has “gray, unappealing flesh.” (Farmed salmon don’t eat the shrimp and krill that produce the red color of wild salmon, so salmon farmers add the color.) Gallego alleged that this was a misrepresentation, since consumers consider color to be a sign of wildness and think that wild salmon is tastier and more nutritious. Wal-Mart did not disclose the presence of the dye at the point of sale or on the packaging. Gallego sought damages for false advertising and unfair trade practices.

The court of appeals reasoned that Wisconsin law has a specific statutory provision prohibiting false advertising with regard to food. Unlike the general false advertising statute, which covers “merchandise” and other things that clearly aren’t food, the food law does not provide for a private right of action. Because of this more specific provision, which indicated that food is not merchandise, Gallego could not assert a private claim based on the general law.

He could, however, state a claim for unfair trade practices under a separate section of the law. Wisconsin regulations require food sold or distributed for sale in-state to be labeled in compliance with FDA rules, and the law provides a private cause of action for violation of state regulations. Wal-Mart did not dispute that FDA rules require disclosure of artificial coloring in salmon; instead, it argued that, for technical reasons, the relevant regulation didn’t trigger a private right of action, but the court disagreed.

More on the issue of dyed farmed fish, including other lawsuits: here here, and here, the last two of which include the marvelous fact that farmers can use a device called the Salmofan® to choose the color of the dye.

A new justification for the derivative works right

Michael Abramowicz has written A Theory of Copyright's Derivative Right and Related Doctrines, 90 Minn. L. Rev. 317 (2005), offering a new justification for the derivative right: not that it offers a tiny increase in the incentive to create over and above the reproduction right, but that it serves to force product differentiation in the derivative markets. I was amused by "[without the derivative right,] it is certain that there would be many written adaptations of Harry Potter, as amateur authors presumably would create a large number of unauthorized sequels and adaptations to other cultural contexts." Because that surely doesn't happen now.

More generally, though Abramowicz's work is typically thorough, I'm not yet convinced that competition in the derivative markets is a bad thing. As Mark Lemley has pointed out, when people copy each other in the market for (unpatented) products like office supplies, we call it the free market; we don't think that forcing product differentiation so that only one producer can make paper clips is efficient, even if the result of the free-for-all is that lots of producers rush into the market and drive the product down to its marginal cost. In fact, that's kind of the point.

The product differentiation theory says works are worth more to consumers when they lack close substitutes, so the production of many similar derivative could be less valuable to consumers than the production of a variety of highly differentiated works. The empirics of this are unclear and my intuitions are that the derivative right does not add social value, in that I see network effects in fandom so that the production of hundreds of stories about one TV show creates more value (including the value of having a fan community in which enthusiasms are shared) than one story about each of a hundred shows, and I also think there's a special pleasure in fetishizing small differences, comparing different treatments of the same basic story - or collecting vegetarian cookbooks, to take one of Abramowicz's examples. Nonetheless, as Abramowicz acknowledges, even assuming that creative works benefit from not being clumped together, and that a derivative works right increases the average space between works, consumers might be better off if free competition drove the price of derivatives down.

My description of the theory suggests that, at least with respect to the highly creative works that tend to spark fan derivative works, the model needs to be modified to take into account fans who enter the "market" and distribute their works freely, as in the Harry Potter novel archive linked above. We can add in non-monetary prices, but I suspect it makes the whole thing much more complicated, especially since sellers of authorized derivative works want to be paid with money. Perhaps there's some work on open source versus proprietary source software that might provide some insights.

There's no such thing as a controlled experiment in copyright, but it might also be worthwhile to look at the spate of unauthorized derivatives of Uncle Tom's Cabin, Tom Sawyer and the like. Those derivatives didn't crowd out other, nonderivative works as far as I'm aware, nor do modern versions of Shakespeare dominate the Blockbuster shelves, suggesting that the product space for copyrighted works is broad enough to give us variety without needing an extra derivative right.

Maybe the real problem I have is with the idea that, if we can propose a detailed enough economic model, we'll know something useful about copyright scope - the difficulty, as with the difficulty in Judge Posner's detailed equation in Sex and Reason that purports to show whether or not abortion should be banned, is that we have no idea what the values of the variables are and no real hope of determining those values. Thus, as Abramowicz acknowledges, his theory shows that a derivative right might be a good idea and might not be. Perhaps the models are helpful if they get us to think about considerations that otherwise might just be unintended consequences - Abramowicz uses his model to argue that we should think about the reproduction right and derivative right separately, and even assign them different scopes, to take into account the difference between reproduction's plain incentive justification and the derivative right's more complex product differentiation justification.

I have of course given only the merest outline of Abramowicz's argument. Interested readers should definitely check it out. Unfortunately, it does not seem to be available at the journal's site or on SSRN.

Mandarins and Geographic Origin

"I guess you could say it's a sense of terroir." What I find particularly interesting (aside from the idea of more yummy tangerines) is that the concept of terroir is, it appears, well enough known to food section readers in LA that it need not be defined.

International survey of nontraditional marks

This excellent site, available in English or German, includes useful surveys of applications and registrations for smell, taste, sound, motion, and other nontraditional marks -- a topic I'll be covering in my trademark class on Tuesday. It seems hard to imagine a taste mark that would be distinctive of the goods and nonfunctional, since (unless you're a baby) you tend to taste objects only when taste is a product feature.

Laches, patent claims, and false advertising

Icon Health & Fitness, Inc. v. The Nautilus Group, Inc., 2005 WL 3681813 (D. Utah)

False advertising cases, like trademark cases, are often decided at the preliminary injunction stage. Because one of the factors in granting preliminary relief is whether the plaintiff delayed in bringing its case, indicating that immediate relief is unnecessary, there is substantial Lanham Act caselaw on the topic. There is somewhat less precedent on the related subject of laches, which was at issue in Icon Health. Laches will bar an action if the plaintiff inexcusably delays in bringing suit and the defendant is prejudiced by that delay.

Icon, which produces fitness equipment under brand names including NordicTrack and Reebok Fitness, challenged two of the Nautilus Group’s claims for its Bowflex exercise machine: (1) that the Power Rods on the Bowflex were patented, and (2) that the Poly-Hexamethaline-Adipamide ("PHA") used in the Power Rods was "developed exclusively by Bowflex" and "not available anywhere else in the world." (Though it doesn’t appear in the decision, it seems likely that PHA is a misspelling of polyhexamethyleneadipamide, also known as nylon.)

The Bowflex patents were issued in 1986 and 1988, and Nautilus has made the claim that the Power Rods are patented for many years. In 1995, Nautilus asked its manufacturer what the Power Rods were made of, and, upon receiving the answer, added the PHA claims to its advertising.

Icon is a large Nautilus competitor with its own patent portfolio, but, the court found, in such a competitive market (at least 100 serious competitors), it cannot reasonably monitor everyone’s patents. The court accepted Icon’s testimony that there is so much advertising in the exercise industry – including via infomercials - and so much work to be done selling one’s own products that keeping track of every competing claim is impossible. Icon occasionally examines competitors’ products when it suspects patent infringement or is developing a similar product. The court found it significant that Nautilus, too, did not generally attempt to verify its competitors’ claims.

The claims at issue here came to Icon’s attention when it developed its own resilient-rod exercise machine, the Crossbar, and Icon had outside patent counsel investigate the matter in 2002. Icon had, however, encountered the Bowflex before, in 1987 when its creator was seeking marketing partners. The creator testified that he always brought along a copy of the patent in his marketing presentation. He sent marketing materials and a product sample to Icon before their meeting, and at the meeting the parties discussed the Bowflex patents as well as the function and features of the Bowflex machine. Icon chose not to invest in Nautilus. The court found that, though the parties are now competitors, they weren’t in 1987 and Icon had no reason to investigate further (presumably because Nautilus was still struggling to get off the ground, and thus was like every other self-promoting small business convinced that it had the Next Great Idea; Nautilus, unlike most ventures, might have been right, but Icon couldn’t have known that at the time).

Aside from that specific encounter, the Bowflex has been widely marketed since the 1980s, and Icon’s witnesses were generally aware of it, whether they watched SportsCenter and saw Bowflex ads or couldn’t sleep and therefore saw infomercials.

The Lanham Act has no limitations period; courts recognize a laches defense using an analogy to the most appropriate state limitations period as a starting point. The parties agreed that the analogous limitations period is Utah’s 3-year statute of limitations for fraud. (This is not a foregone conclusion, since state unfair competition law or even state trademark law are also candidates for the analogy.) Utah applies a discovery rule that starts to run when the plaintiff knew or should have known of the facts constituting the fraud or mistake.

The question was not when Icon knew of the Nautilus statements, but when it should have looked into the truth or falsity of those statements. The court found that Icon had no reason to investigate before 2002, and filed suit shortly thereafter. Its actions, in the context of the highly competitive and claim-clogged exercise market, were not unreasonable. Thus the Lanham Act claim will proceed. (A similar result obtained with respect to Icon’s claims for false patent marking.)

Other observations: (1) Critics of competitor suits for false advertising have pointed to cases like this (objections to a competitor's claim of patent protection) as evidence that competitors sue over matters about which consumers in fact care little. Materiality will still be an issue as the case proceeds, but I think it's reasonable for consumers to be influenced by claims of uniqueness and patent protection, both of which imply special efficacy. Consider patent medicine, which used the legal concept of patent (or, more often, trademark) to give nostrums a convincing mystique.

(2) This case features a 1:14 ratio of plaintiff’s attorneys (attorney, actually) to defendant’s attorneys. The race is not always to the swift, nor the battle to the strong – though, present result notwithstanding, that’s the way to bet.

I suppose it was inevitable

Ned Snow, writing in the Syracuse Law Review (unfortunately unavailable at the Law Review's site), argues that Grokster makes Tivo liable for inducing infringement, because commercial-skipping undercuts the economic basis for commercial-supported TV. I told my copyright law students that there's no such thing as a natural right to a business model, but Congress can always provide.

I disagree vigorously with much of what Snow says; what I found downright puzzling was his claim that "In Sony, the claim of contributory infringement against the VCR manufacturer stemmed solely from the fact that the manufacturer sold VCRs; the manufacturer did not encourage VCR users to reproduce copyrighted broadcasts." Take a look at this ad, if the absurdity of Snow's claim isn't plain on its face.

Full cite: Ned Snow, The Tivo Question: Does Skipping Commercials Violate Copyright Law?, 56 Syr. L. Rev. 27 (2005).

Remember that hypothetical about whether taping lectures infringed on rights in the prof's notes?

Hypothetical no more: UCLAProfs.com offers money for tapes and notes of targeted professors' classes. The idea is to expose ideological bias. Once students are taping, or even taking notes, for pay, they probably have exceeded the scope of any implied license. And here's an instance where the copy-shop cases pose a problem for students: while UCLAProfs.com's political program undoubtedly offers it a fair use defense for reproducing portions of lectures/notes that show professors' bias, students who provide the entirety of a semester's content -- as required by the site's offer - are engaging in wholesale, for-profit copying, and the fact that this copying is in the service of someone else's ultimate fair use is, under current precedent, unlikely to help.

A couple of points: The disclaimer says the site won't accept any tapes if the professor hasn't agreed to be taped, so that could solve the taping problem, but that still leaves the issue of whether detailed notes of a class could be a derivative work of the professor's notes.

The disclaimer also says the site won't pay "for copyrighted materials in any form." Yet students only get full payment for "full, detailed lecture notes, all professor-distributed materials, and full tape recordings of every class session." Plainly (and understandably, since I doubt anyone behind the site is a copyright lawyer) they're ignoring the copyright in the lecture notes -- no matter who holds that copyright, it exists unless the class is entirely unoriginal even in selection and arrangement -- and the tape recordings. I guess the disclaimer means students are supposed to turn over their John Stuart Mill handouts but not their Re-Elect Obama handouts.

Ben & Jerry's Ice Cream

Ben & Jerry's Ice Cream Greeting Cards ... from Florida State University. Photomicrographs (photos taken through a microscope) of popular Ben & Jerry's ice cream flavors, available as greeting cards. FSU apparently licenses the production of various decorative/promotional goods from its photos to Amber Lotus. Available bookmarks, for example, include PowerPC 620 and Cherry Garcia.

Pretty, but possibly infringing? Though Chocolate Chip Cookie Dough is generic, the line of greeting cards is called "Ben & Jerry's Ice Cream," and Chunky Monkey and Wavy Gravy are arbitrary/fanciful. Under the microscope, Wavy Gravy is no more psychedelic than the other flavors.

Nominative fair use?

When I was in law school -- but clearly on my way to becoming an IP prof -- I wrote Ben & Jerry's asking about the trademark aspects of the name change from Coffee Heath Bar Crunch to Coffee Toffee Crunch and back. This was before they'd been bought out; I got an answer, which was that, though they had used Heath Bars to make Coffee Toffee Crunch (and thus its presence in the Flavor Graveyard is a mite misleading), they decided to pay to use the trademark because taste tests showed that people liked the ice cream more when it was called Coffee Heath Bar, a result whose physiological basis has now been suggested by Read Montague's brain-imaging studies of Coke v. Pepsi preferences: people like Coke more in non-blind taste tests but Pepsi more in blind taste tests; the name "Coke" triggers positive memory associations.

Under Champion Spark Plug and the nominative fair use cases, did Ben & Jerry's really need to pay to use the name if they were using real Heath Bars?

Don't read

So, apparently the American Library Association sent a cease and desist letter alleging that Audible.com's Don't Read campaign "violates" the trademark of the ALA's "Read" campaign. Oh, ALA, how you have betrayed me! You're so good on copyright; wherefore are you making such a silly trademark claim?

Yesterday, as I was saving the Audible "Don't Read" posters, which were available from the website in PDF form, that feature was disabled, so I only got a few. I guess that change, which eliminates the version of the ads most like the ALA's poster-based campaign, was made in response to the threat letter, but I continue to see the "Don't Read" ads pop up on sites I visit.

I think the Don't Read campaign is icky, but that doesn't make it infringing. I do wonder about the use of a .org domain as the website, which seems a teeny bit misleading.