Friday, May 25, 2007

Perfect 10 v. Google and Amazon : Copyrights : Transformative Fair Use : In-Line Linking : Framing : Vicarious and Contributory Infringement

Warning: some of the links here - or links from linked pages - may take you to pages with adult content. Caveat emptor (enter at your own risk).

Opinion in the consolidated case

Perfect 10 v. Google and Amazon (A9.com)
(9th Cir. May 16, 2007)
at the 9th Circuit Website

The opinion is also available online at Stanford Cyberlaw
and at LawGeek (Jason Schulz)

The copyright infringement case discussed in this posting and just decided in the 9th Circuit of the United States Court of Appeals really has it all. It is clearly a "10" in my book, or, viewing it from the side of the opposite sex, you might call it a recipe for "perfect copyright cake":

Recipe: Take Los Angeles, Beverly Hills and Hollywood. Then add an adjunct professor, computer expert, money manager and championship poker player (Norm Zada), who, first irked inter alia by the Playboy rejection of a friend, then publishes a rival magazine, Perfect 10. Stir in copyrighted commercial photographs of "Perfect 10's" topless and nude women, as posted to other Internet websites by unauthorized third parties. Bake under intense scrutiny on the Internet in a form using thumbnails generated by the Google search engine, with search results in-linking to such unauthorized photographs. Remove those search thumbnails from that digital oven at the bidding of the copyright owner of the photographs ... or else?

Presto: Perfect Copyright Cake, or,
as the lawyers might say, "the result is a very interesting copyright case".

What is a "Perfect 10? The underlying rating concept derived from a film:

"The 1979 romantic comedy film 10, directed by Blake Edwards and starring Bo Derek, Dudley Moore and Julie Andrews ... [derived its title of "10"] from a rating system used by people to rank members of the opposite sex based upon beauty, with a 10 being the epitome of attractiveness. It came into common usage as a result of this film...."

What Is the History of "Perfect 10", the publisher?

"Perfect 10 was created by Edward Rasen, the original executive editor of SPIN magazine and creator of SPIN Radio. Perfect 10 Video was launched during 1992 and Julie Kruis, a noted swimsuit model (Miss Swimwear Illustrated, etc.) was the original spokesmodel. Initially, Mr. Rasen published a newsletter and then a magazine until May 1998 when he sold the magazine, web address and video line name but not library to Norman Zadeh [now Norman Zada], a former Stanford University computer science professor and hedge fund manager. Mr. Rasen's version of Perfect 10 did not include pictures of naked females."

What is the case about?"

Frederick Lane at the NewsFactor Network summarizes the case as follows (May 17, 2007):

"Last year, a U.S. District Court in California issued an injunction against Google and Amazon.com (which operates the A9 search engine), barring them from including thumbnails of photographs from the magazine and Web site Perfect 10 in their image search results.

On Wednesday, the U.S. Court of Appeals for the Ninth Circuit (which includes California) overturned that decision and sent the case back down to the District Court for further proceedings. Writing for the unanimous three-judge panel, Judge Sandra S. Ikuta said that "[w]e conclude that Perfect 10 is unlikely to be able to overcome Google's fair use defense and, accordingly, we vacate the preliminary injunction regarding Google's use of thumbnail images."


TRANSFORMATIVE FAIR USE
and a Logical PARALLEL to KSR Teleflex & Patents


In the opinion of LawPundit, the most important element of Judge Ikuta's written opinion is the holding on the issue of transformative fair use, previously commented on LawPundit. Judge Ikuta writes:

"We conclude that the significantly transformative nature of Google’s search engine, particularly in light of its public benefit, outweighs Google’s superseding and commercial uses of the thumbnails in this case. In reaching this conclusion, we note the importance of analyzing fair use flexibly in light of new circumstances. Sony, 464 U.S. at 431-32; id. at 448 n.31 (“ ‘[Section 107] endorses the purpose and general scope of the judicial doctrine of fair use, but there is no disposition to freeze the doctrine in the statute, especially during a period of rapid technological change.’ ”) (quoting H.R. Rep. No. 94-1476, p. 65-66 (1976), U.S. Code Cong. & Admin. News 1976, p. 5680)). We are also mindful of the Supreme Court’s direction that “the more transformative the new work, the less will be the significance of other factors, like commercialism, that may weigh against a finding of fair use.” Campbell, 510 U.S. at 579."

This modern line of reasoning - in emphasizing "rapid technological change" and "new circumstances" - mirrors the trend of logic found in US Supreme Court Justice Kennedy's opinion in KSR v. Teleflex, where "modern technology ... market demand ... [and] design trends" are to be given more attention in the future than in the past in making the obviousness test for patents. Similarly, the scope AND limits of copyrights must be formulated to suit the modern age - rather than the long gone Gutenberg era.

Who bears the economic costs of protecting copyrights and patents?


One of the problems with patents and copyrights is that patent and copyright holders generally see only their "rights" and "profits", without any obligations. They see neither the "costs" that protection of their copyrights and patents engenders, nor who is to pay for those costs. The US Constitution does not provide that copyright and patent holders enjoy their monopolies free of costs. They are to be free to exploit their works and inventions but there is no clause which provides that others are to pay the bill for policing their private rights. There is also the ancillary issue of licensing costs, which should bear some sensible relationship to the actual benefit that a copyright or patent provides to society, otherwise the copyright or patent is - as a matter of simple economics - not worth protecting.

In The Two Faces Of Perfect 10 v. Google, by Anthony Falzone, Executive Director, Fair Use Project, Center for Internet and Society (Law, Science and Technology Program), Stanford University Law School, May 16, 2007, Falzone points out that the issue of secondary liability is an especially troublesome one in the case of Perfect 10 v. Google and Amazon as follows:

"The Ninth Circuit ... announced [that] there "is no dispute that Google substantially assists websites to distribute their infringing copies to a worldwide market and assists a worldwide audience of users to to access infringing materials." Accordingly, it held Google could be liable for contributory infringement if Perfect 10 can show Google (i) "had knowledge that infringing . . . images were available using its search engine," (ii) "could take simple measures to prevent further damage to Perfect 10's copyrighted works," and (iii) "failed to take such steps."


In other words, it held that Google could be held liable for providing search results that lead a user to a site with infringing content, so long as Google knew infringing content was available and could have done something "simple" to stop it."

Jon Healey's BIT PLAYER in Google and fair use at the Los Angeles Times states that:


"The 9th Circuit Court of Appeals' ruling today in Perfect 10 vs. Google and Amazon is a clear victory for search engines and tech companies -- and a clear defeat for copyright holders -- on a couple of fronts. But it also includes some language that could conceivably spell trouble for YouTube, MySpace and other user-generated content sites in their legal battles with the entertainment industry....

[T]he 9th Circuit said [District Judge] Matz was wrong to reject Perfect 10's claim that Google contributed to the infringements done by other Web sites. The panel sent the case back to him, saying he should apply this test:

Accordingly, we hold that a computer system operator can be held contributorily liable if it "has actual knowledge that specific infringing material is available using its system," Napster, 239 F.3d at 1022, and can "take simple measures to prevent further damage" to copyrighted works, Netcom, 907 F. Supp. at 1375, yet continues to provide access to infringing works.
The "take simple measures" has typically been interpreted to mean that a site removes infringing material when asked by the copyright holder. And the 1998 Digital Millennium Copyright Act, which Congress passed partly in reaction to the Netcom case, provides a strong defense against copyright infringement claims for Internet services that comply with its notice and take down provisions. Still, Mark Lemley, a law professor at Stanford University and an expert in copyrights, said the 9th Circuit's decision could open the door to later rulings that require Internet services to do more to protect copyrights because new technology made it easy to do so. That's a slippery slope, he said, that could put the courts in the uncomfortable position of mediating technical disputes between Internet companies and content providers over how Web-based services are designed."

In "Google thumbnails are fair use, says Court of Appeals"
at Outlaw-Com on May 18, 2007:


"A US court ruled this week that Google's creation and display of thumbnail images does not infringe copyright. It also said that Google was not responsible for the copyright violations of other sites which it frames and links to....

[T]he Ninth Circuit overturned a preliminary injunction that was imposed against Google in March. But it left some significant questions open, and sent them back to the lower court....

The issue of Google's knowledge of the infringements was vital. Though it formed a part of both hearings, it remains unresolved and the Court of Appeal has asked the District Court to look at it again.

A crucial issue in copyright disputes is how a company deals with an infringement once it has been notified of it. In this case there was some dispute about whether or not Perfect 10's notifications were specific enough for Google to be expected to act on them.

"The district court did not resolve the factual disputes over the adequacy of Perfect 10’s notices to Google and Google’s responses to these notices," said the Court.

"Moreover, there are factual disputes over whether there are reasonable and feasible means for Google to refrain from providing access to infringing images. Therefore, we must remand this claim to the district court for further consideration whether Perfect 10 would likely succeed in establishing that Google was contributorily liable for in-line linking to full-size infringing images under the test enunciated today."

Judge Ikuta said that Google could not be held liable for vicarious infringement because it had no power over the third party infringing websites and could not tell them to stop hosting Perfect 10's images."


Nice applause for the developing savvy of the federal courts in technological matters is found from Cynthia Brumfield at IP & Democracy.

See also John Ottaviani in Summary of Perfect 10 decision at Eric Goldman's Technology & Marketing Law Blog:

See also The Rub from Wendy Seltzer

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