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I’m Published!

January 7, 2011

A paper of mine has been published in the University of New Hampshire School of Law Newsletter. Check it out:

Remedies for Unfair Trade and Patent Circumvention Caused by Pharmaceutical Price Controls by David Connaughton

On another note, I will be starting work as a patent attorney at Lambert & Associates. This will be a very busy time, and my postings will be less frequent.

Mashups and Fair Use: Final Judgment

December 9, 2010

In my previous two posts, I have proposed arguments that mashup music such as Girl Talk’s new album does constitute fair use (here), and that it does not constitute fair use (here). Now, in the third part of this post series, I will play judge and decide how I think the issue of mashups, copyright infringement and fair use should play out.

I believe that when considering arguments on policy and the fair use factors, mashups do constitute fair use in light of the transformative nature of mashups, and the minimal impact mashups have on the market for the original works. These points go to the heart of copyright policy, which seeks to drive the arts as a whole forward. Mashups are transformative and creative enough to be their own works. At the same time mashups do not compete with the economic interests of existing rights holders. Therefore, by allowing mashups, the arts as a whole are enriched, without interfering with copyright holders’ rights.

Mashups such as Girl Talk’s are highly transformative. Mashups take portions of different songs: a lyrical track, a beat, etc. and combine them together in a unique, unexpected and transformative way. There is much more involved than just cutting and pasting different songs together, as some critics may argue. Typically, the mashed up songs do not come close to the originals in length, impact or feel. This transformative nature is a key distinction because it makes the work more unique and less of a copy.

Further, mashups such as Girl Talk’s have a minimal impact on the market for the original works because they of the amount of transformation, and the use of already established songs. It is highly unlikely that someone would download Girl Talk’s album to hear a short sample of a song that they like instead of buying that song. The samples are too short, and too different to reflect the original song.

On the other hand, there will be many cases where there is not enough transformation to favor fair use. An example might be the Jay-Z/Linkin Park mashup album, where the mashups are just two songs from two artists. It is hard to draw a line in this circumstance, but it probably should be between Girl Talk’s use of 10+ samples, and the two of Jay-Z/Linkin Park. The amount of transformative activity will also directly impact the market for the original works because a lack of transformation means that it is easier to substitute one work for the other.

Mashups are a unique art form that does not interfere with the economic interests of copyright holders, and therefore copyright policy favors mashups being considered fair use. The issues of transformation/creativity and economic impact, directly reflect the policy of copyright law, and must be heavily weighed when determining fair use. Copyright law seeks to promote creativity by providing economic incentives to creators. It follows that without economic damage to creators, copyright law should not interfere with creativity. In the case of mashups, there will not be economic damage to the original creators of the songs used. Further, mashups are highly creative and transformative of the original works, and policy should encourage their creation.

Because the fair use factors weigh in favor of fair use, and because policy encourages it, mashups should be considered fair use. There is certainly room for debate, and many artists may not like the outcome. The fact remains however that mashups are little like the songs that comprise them, and in no way interfere with the sales of artist’s original works. The artists can still make their money, and at the end of the day should be happy to know that Girl Talk others are fairly using their works to further enhance the arts.

For further discussion of the arguments for and against fair use for mashups, see

Mashups: Copyright Infringement Without a Fair Use Defense? and

The Fair Use of Mashups

The Fair Use of Mashups

December 3, 2010

In light of the release of the new Girl Talk mashup album: All Day, I have decided to analyze the availability of a fair use defense for mashups in a three-part series. In my previous post, the first of my three-part analysis of mashups and fair use, I argued that mashups are pure copyright infringement not subject to a fair use defense. Here, arguments favoring fair use will be presented, demonstrating why fair use may be a valid defense for mashups.

For those unfamiliar, a mashup as defined by Wikipedia is: “a song or composition created by blending two or more pre-recorded songs, usually by overlaying the vocal track of one song seamlessly over the instrumental track of another.”

 

Mashup music may initially to appear to infringe the copyrights of the songs it samples, however, there is a clear fair use defense available. Based on the fair use factors set forth in 17 U.S.C. §107 it can be seen, on a balance of the different factors, that mashups are a fair use of the copyrighted works they are made of. Further, mashups are the type of valuable, new, creative works that copyright law and policy seeks to protect.

17 U.S.C §107 sets forth four factors to consider when determining a fair use defense:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

Regarding the first three factors, Campbell v. Acuff-Rose Music provides guidance on the analysis. It is important to note however, that these factors must be weighted differently depending on the facts at issue. Further, the Supreme Court, in Harper & Row Publishers, Inc. v. Nation Enterprises, has noted that the fourth factor: “is undoubtedly the single most important element of fair use.” Finally, these factors are not exclusive, a court can consider other factors, such as the value and creativity that a work brings to society.

In brief, the first and second factors will likely lean against a finding of fair use for mashups, however the third and fourth factors, along with copyright policy, favor a finding of fair use. Further, when the factors are weighed, and the importance of the fourth factor is considered, it is likely that mashups will be subject to a fair use defense.

The first factor, the purpose and character of the use, may not favor a finding of fair use. In Campbell, the court identified that parody and social commentary favor a finding fair use, while actions such as pure copying would not. In the case of mashups, it is difficult to argue parody or social commentary, but at the same time, it is not quite “pure copying.” Yes, small portions of parts of songs are copied, but they are copied in a transformative way such that the new work is much different from the original. If a court were to pick a side, it would likely find that a mashup is slightly more akin to pure copying than social commentary, making the first factor weigh slightly against a fair use defense.

The second factor likely weighs against fair use because the musical recordings are the type of work that is at the core of copyright protections. This factor looks to the type of work that has been infringed to determine if it is, as stated in Campbell: “within the core of copyrights protective purposes.” The Court held that a musical work would indeed fall within the core of copyright protections. Musical works are at issue, therefore the second factor weighs against a finding of fair use because they are at the core of copyright protections. However, this second factor does not seem to add much value to the overall analysis, and is a weakly persuasive factor, at best.

The third factor, the amount and substantiality of the portion used, weighs in favor of a finding of fair use because the mashup artist uses only short snippets of particular tracks of songs, not substantial portions of the entire song. For example, a mashup typically consists of a short vocal track section extracted from the original song “mashed” with a beat or other musical snippet from another song. In Campbell a song was initially copied but quickly shifted to an original work. Likewise, in the case of mashups, a portion of a song is initially used, but then quickly shifts to another song in an original, creative and transformative way. Further, Campbell found that a the modification of the original song favors fair use. Mashups often involve speeding or slowing of tracks so that their tempos line up, Therefore, the minor and insubstantial use of musical tracks would favor a finding of fair use for the third factor.

The fourth and most important factor, the effect of the potential market of the original work, weighs heavily in favor of fair use because mashups do not interfere with the markets for the original songs. The fourth factor is considered to be the most important because it relates most directly to the policy of copyrights: to provide economic incentives for creators to create and to enrich society by encouraging creative authorship. Mashup songs do not interfere with the market for the original works because they only use small portions of the music, they largely use pre-established songs, and they do not replicate the original songs- they substantially transform them into new creative music.

Mashups use only a portion of a particular song combined with one or more other portions of other songs, as such, the use is not substantial enough to interfere with the value of the original song. If anything, the small portion acts as a teaser, attracting listeners to that particular song, and providing free advertisement for the original artist. Realistically, if a consumer only wants to listen to one verse of one song of an artist, they are not likely to buy the music anyway. Therefore, there is little to no impact on the market of the original songs.

The attraction of many mashup songs comes from the fact that the sampled songs used are well-known. Therefore, because consumers are familiar with the music, they have likely already made the decision to buy or not to buy the original, thus there is little impact on the market for the original works. It will be a rare case that a consumer downloads a mashup with a short sample of their favorite song as a substitute for purchasing the original.

Mashups do not replicate the songs they sample, instead, they a transform the songs substantially, such that there is little relation to the original work, and in turn, little impact on the market for the original work. As previously noted, Mashups use short samples of original works mashed with other samples. These short sections, when combined, result in a song that has been highly transformed from the original. Mashups do not replicate original songs, they operate in different markets and should not be found to interfere with the market for the original work. Therefore, the fourth factor weighs in favor of fair use for mashups.

Finally, Copyright policy strongly favors the creation of mashups because mashups represent tremendous progress in the arts, and at the same time, does not interfere with the incentives created by copyright law to encourage creativity. Copyright law seeks to enrich society by encouraging new creativity. This goal is achieved by balancing protection and economic incentives with freedom for new creators to build off of the developments of others. One major way that this balance is achieved is by fair use.

In the case of mashups, the copyright law balance strongly favors encouraging them. On the protection side of the balance, it has been established that mashups to not interfere with the rights or economic prospects of the original creators. On the freedom side, mashups are a new, popular and exciting type of art- exactly the type of works that copyright law seeks to promote. Therefore, in addition to finding support in the statutory factors, copyright law’s underlying policy also strongly favors a finding of fair use.

It has been shown that mashups fit comfortably within a fair use of copyrighted works, particularly because of the lack of economic interference with the original works mashups are made of. While the first two fair use factors weigh against a finding of fair use, the final two, more important factors favor fair use, as does copyright policy. When balancing the factors, it is clear that mashups are a fair use of copyrighted music.

Mashups: Copyright Infringement Without a Fair Use Defense?

November 30, 2010

On November 15, Girl Talk released his fifth mashup album entitled All Day. This brilliant collection of music will inevitably stoke the fires on the issues of fair use and copyright boundaries. This post will be the first of a three-part post where I analyze the availability of a fair use defense for mashup songs, arguing both sides in separate posts, and concluding in the third.

For those unfamiliar, a mashup as defined by Wikipedia is: “a song or composition created by blending two or more pre-recorded songs, usually by overlaying the vocal track of one song seamlessly over the instrumental track of another.”

Mashup music, by sampling portions of copyrighted songs, technically constitutes copyright infringement because it violates the exclusive rights of a copyright holder as set forth in 17 U.S.C. 106. The looming question is if a fair use defense is available. Based on the statutory fair use factors of 17 U.S.C. §107, it can be seen that mashups are not a fair use of the copyrighted works they are comprised of. Moreover, by interfering with the rights granted to copyright holders, protecting mashups discourages the creation of new music, and runs counter to the goals of copyright law.

17 U.S.C §107 sets forth four factors to consider when determining a fair use defense:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

Regarding the first three factors, Campbell v. Acuff-Rose Music provides guidance on the analysis.

The first factor, the purpose and character of the use, does not favor a finding of fair use because the mashup is pure copying with no parodic or commentating value. In Campbell the court distinguished protected “social commentary” and parody from pure copying. As far as mashups are concerned, there is little to no social commentary or parody involved. Instead, the mashup simply contains copied portions of copyrighted works. Therefore the first factor weighs against a finding of fair use.

The second factor, the nature of the copyrighted work, weighs against fair use because the musical recordings are the type of work that is at the core of copyright protections. This factor looks to the type of work that has been infringed to determine if it is, as stated in Campbell: “within the core of copyrights protective purposes.” The Court held that a musical work would indeed fall within the core of copyright protections. Musical works are at issue, therefore the second factor weighs against a finding of fair use because they are at the core of copyright protections.

The third factor, the amount and substantiality of the portion used, weighs against fair use because the mashup artist typically samples substantial portions of songs so that the listener can identify and enjoy them. In Campbell a song was initially copied but quickly shifted to an original work “substituting predictable lyrics with shocking ones”. The Court found that this minimal use favored fair use. Alternatively, a mashup artist samples substantial portions of copyrighted works to mash them together. These portions generally include the most identifiable, and therefore most protected, portions of the original songs. Further, unlike Campbell, there is no modification of the mashed up songs, a mashup is simply a rearrangement of vocal and musical tracks. Therefore the third factor weighs against a finding of fair use.

Finally, the fourth factor, regarding the effect for the potential market of the original work, weighs against a finding of fair use because mashups may interfere with the value and sales of original songs. This fourth factor can be considered the most significant because it touches at the basic policy of copyrights: to provide economic incentives for creators to create. The Court in Campbell notes that if a “substantial portion of the infringing work was copied verbatim from the copyrighted work,” it suggests a “greater likelihood of market harm.” In the case of mashups, it has already been established that a substantial portion of the songs are copied verbatim. Therefore it is likely that consumers will acquire mashup songs instead of paying for the original music, thereby violating the purpose of copyright law, and preventing creators from benefiting from their creations.

Allowing mashups will discourage creativity and therefore runs counter to the constitutional copyright policy of promoting progress in science and the useful arts. Mashups discourage creativity by preventing creators from capitalizing on their works, and by allowing the works that are created to be chopped and mashed with other songs. Mashup music is precisely the type of activity that copyright law seeks to prevent. It takes substantial portions of different songs, rearranges them and combines them with other songs, resulting in profit for the mash up artist while the original songwriter is left with nothing.

Mashup music certainly constitutes copyright infringement. In addition, it has been shown that a fair use defense will likely fail because of the purpose of mashups, the substantial amount taken from the original works, and the nature of mashups interfering with the market value of the originals. Indeed all four factors weigh against a fair use defense. Moreover, policy favors against a finding of fair use because it prevents creators from controlling their works and discourages their continued creativity.

Costco v. Omega and Copyright Misuse

November 24, 2010

The Supreme Court recently heard oral arguments in Costco Wholesale Corp v. Omega, S.A.. The question directly raised in the case is if watches, containing a small copyrighted image on the back, first sold in Switzerland and later imported into the United States, will infringe the copyright holder’s rights upon importation. This issue is discussed in detail on Patently-O, so I will not rehash it here. However, the facts of the case raise other interesting questions.

One such question, and focus of this post, is if Omega is subject to the equitable defense of copyright misuse because of their use of a negligible copyrighted image to control the importation and sale of a non-copyrighted article (the watch). Copyright misuse is something of an elephant in the room in the case because it is not directly at issue, and was not mentioned at oral argument. However, some amici have raised the issue in their briefs, so it will be interesting to see how the Court responds, if at all.

The leading case for IP misuse is Morton Salt v. G.S. Suppiger. There, the Supreme Court identified that when a patent or other IP is used to prevent competition in areas outside of the limited grant of rights, equity will prevent assertion of the rights. The court notes that a patent promotes public policy by providing the inventor with special rights to the invention only, and not to anything outside of the patent grant. Regarding articles outside of the grant, competition is a positive factor that promotes public policy and should not be interfered with by the patent holder. Therefore, any attempts of a patent holder to extend their rights to non-patented items interferes with competition on the open market and amounts to misuse.

The Court held that a patent “granted in the furtherance of a public policy may not claim protection of his grant by the courts where it is being used to subvert that policy.” In other words, a patent holder may not use his patent rights to interfere with the sale of non-patented articles. Likewise, a copyright holder may not use his copyright rights to interfere with the sale of non-copyrighted articles. This reasoning has been applied to copyrights in Lasercomb America v. Reynolds, a Fourth Circuit decision upholding the concept of copyright misuse.

In Costco, copyright misuse should apply. Omega is using a copyrighted image to control the sale of a non-copyrighted watch. The image is subtle, inconsequential, and has no impact on the watch purchase. Omega should not be allowed to claim protection of copyright in this case because copyright is being used to subvert competition in the sale of non-copyrighted items.

Copyright law promotes artists and artistic expression by preventing others from copying and reselling an artist’s works. Omega’s attempts at preventing the sale of a non-copyrighted watch with a copyrighted image on the back does not promote artistic expression. Instead, doing so is an attempt to subvert competition in the open market of non-copyrighted articles and constitutes copyright misuse.

It is clear that Omega is misusing their copyright, the question is if and how the Supreme Court will address the issue. Omega’s lawyers have done a clever job twisting copyright law to attempt to control the importation and use of their watches, and further, they have managed to avoid a direct Supreme Court showdown regarding the misuse of their copyright. The issue is in front of the court however, thanks to amicus briefs, and hopefully the Court will smell something fishy and delve into the issue.

*Special thanks to Professor Thomas G. Field, Jr. for taking the time to discuss this topic with me, and pointing out appropriate case law.

DOJ Gets Confused About Patent Law

November 9, 2010

The DOJ has recently submitted an amicus brief in AMP v. Myriad (Fed. Cir. 2010) arguing that isolated genes are ineligible patentable subject matter under 35 U.S.C. §101. The DOJ does advocate that human engineered genes should be patent eligible, and focus their argument on naturally occurring isolated DNA sequences. In so doing, the DOJ jumbles together 35 U.S.C. §§101, 102, and 103, confusing the issues of patent eligibility with patentability. Moreover, the brief fails to understand the policy concerns and implications of their position.

The DOJ argues that isolated genes are unpatentable because they are a “product of nature.” In so arguing, the DOJ jumbles statutory sections, and bases its position on novelty (35 U.S.C. §102) and obviousness (35 U.S.C. §103) rationale.

Naturally occurring chemicals, claimed in isolated form, are patentable. Schering v. Geneva 339 F. 3d 1373 (2003). DNA, as a chemical, is no different from other naturally occurring chemicals. All bioactive chemicals do something, just because DNA provides the starting point for the production of another molecule should have no bearing on its patent eligibility.

In Schering, the Federal Circuit held that a naturally occurring metabolite of a drug was unpatentable under §102, because it was inherently anticipated when produced by the human body. However, the court noted that if the metabolite were claimed in isolated or purified form, it would be patentable. No §101 issue was raised, because, as in Myriad, it is not an appropriate argument.

For another example, it is common and appropriate for chemicals from plants to be isolated or purified and then patented. It is inappropriate to draw a distinction between DNA and other chemicals. These chemicals, along with isolated DNA are new, useful compositions of matter, or at least improvements thereof, and as such are patent eligible subject matter under §101.

The DOJ uses §102 novelty reasoning when it argues that isolated DNA is not patent eligible subject matter, stating that because the “basic natural relationships” between the molecule that the DNA codes for, and the molecule itself is a “natural phenomena”. This argument is analogous to the chemical-metabolite inherent anticipation fact pattern in Schering. Like DNA transcription, a natural phenomena causes the drug in Schering to be transformed into the metabolite at issue. The Federal Circuit correctly ruled that the metabolite is not novel under §102, but not that it is entirely patent ineligible.

The DOJ further confuses §101 with §103 obviousness when it argues: “Isolation does not transform a product of nature into a man-made invention.” In other words, the DOJ is arguing that there is no “inventive step” involved in the isolation of DNA. Those familiar with foreign patent law will recognize that “inventive step” is analogous to obviousness in other jurisdictions. Therefore, the “transformative” argument has no place in §101, but rather §103.

 

When analyzing policy considerations of DNA patent eligibility, it is clear that to further progress in genetic research, isolated DNA sequences should be patentable. Patents are vital to progress in the medical field because of the tremendous investment required, and the ease with which innovation can be copied. To promote progress in genetic research, broad patent eligible subject matter is required.

Those opposing patents on isolated DNA shortsightedly argue that it is unfair that some women are unable to afford the patented breast cancer screening tests, and this lack of access should bear on patent eligibility. Removing isolated DNA from patent eligibility may give a few people low-cost treatment in the very short-term, but would kill innovation in the field, preventing society as a whole from benefiting. While it is a tragedy that some are unable to pay for cutting edge cancer screening, or any other cutting edge medicine, a greater tragedy still would be if everyone were to be denied new treatments. Without patents, medical innovation would slow drastically because of a lack of funding, preventing society as a whole from access to medical progress. Thus, the policy argument against patent eligibility is shortsighted, progress in the field is clearly driven by the patent system, and therefore policy favors isolated DNA patent eligibility.

In arguing against the patent eligibility of isolated DNA the DOJ sets forth novelty and obviousness reasoning thinly veiled to use patent eligibility language. Further, the DOJ fails to appreciate the patent policy implications of their position. There may be strong arguments that this particular isolated DNA is not novel under §102, or that it is obvious under §103, but eliminating the entire field of DNA research from patent eligibility is too extreme a measure. Hopefully, the Federal Circuit will see through the DOJ’s reasoning, and hold isolated DNA to be patentable by overruling the district court decision.

USPTO Fee Diversion: Taxing Innovation

November 3, 2010

Congress has been diverting 10% of USPTO revenues, which come directly from patent applicant fees, in effect creating a direct tax on innovation paid by the innovators themselves. This fee diversion tax simultaneously siphons much needed money from the patent office and at the same time creates a disincentive to innovate. To strengthen the patent system in the US and promote the progress of the useful arts, it is imperative that Congress stop taxing innovation through fee-diversion.

Fee diversion, until recently, has not received much attention among commentators, at least in the past few years. Lately however, the practice has been given more attention, both by Congress giving some money back, earlier this year, and by some commentators such as retired judge Paul Michel.

From what I understand, fee diversion started in the fall of 1990 as part of attempt to balance the federal budget. Not surprisingly, this diversion has continued to this day, either because nobody has made enough of the issue to get attention, or because of a lack of motivation for anyone to stop it, or both. Hopefully, as more people become aware of the issue, things will begin to change, and the USPTO can get back the 10% that it, and inventors, deserve.

Ending fee diversion would greatly aid the patent office, promote progress in the useful arts, and stimulate the economy. Fee diversion takes $230 million from the Patent Office. Congress adds this money to its already generous spending, while the patent office is dying on the vine. If this practice were stopped, the patent office would have substantially more funding to work with. More funding would, quite obviously, cut down the backlog, allow for updated systems and infrastructure, and allow patent applicants to genuinely get what they pay for. The result would be more valuable US patents.

In addition to being a drain on the patent office, the 10% fee-diversion tax creates a disincentive for innovation. Taxes must balance the disincentives they create (sin tax) with the importance of raising funds. In the case of USPTO fee diversion, Congress is failing miserably at this balance. Disincentivizing innovation is about the last thing that a good economy should be doing. Further, innovation is already taxed heartily through corporate, income and capital gains taxes, so Congress should not take any more.

A tax fails when it is so high that it kills the revenue stream itself. This is the case with the current USPTO fee-diversion system. The USPTO is suffering from an outrageous backlog, and cannot provide adequate services to its clients. Moreover, American innovators should not be taxed and thereby disincentivized for their innovation more than they already are. Ending fee-diversion would achieve both of these goals, stimulating innovation and the economy, and promoting patent policy.