Copyright Infringement

June 26, 2013

Microsoft Sues Mister HardDrive and Mark Cady for Copyright and Trademark Infringement

New Albany, Ind. — Intellectual property lawyers for Microsoft Corp. of Redmond, Wash. sued Mister HardDrive and Mark Cady of Scottsburg, Ind. alleging infringement of copyrighted work TX 5-407-055 titled Microsoft Windows XP Professional : version 2002 registered with the U.S. Copyright Office; and Trademark Registration Nos. 1,200,236; 1,256,083; 1,872,264 and 2,744,843 registered with the U.S. Trademark Office.

Microsoft, the seventh largest publically traded company in the world, has sued Mister Harddrive, a business entity of unknown legal structure that is also known as Mister HardDrive’s Wipe and Restore (“Mister HardDrive”), and Mark Cady, an individual, alleging that they engaged in copyright and trademark infringement; false designation of origin, false description and representation; and unfair competition.

Microsoft develops, markets, distributes and licenses computer software. Microsoft’s software programs are recorded on discs, and they are packaged and distributed together with associated proprietary materials such as user’s guides, user’s manuals, end user license agreements, and other components. Mister HardDrive is engaged in the business of advertising, marketing, installing, offering, and distributing computer hardware and software, including products sold as Microsoft software.

In its complaint, Microsoft alleges that Mister HardDrive and Mark Cady offered, installed, and distributed unauthorized copies of Microsoft software and thereby infringed Microsoft’s copyrights, trademarks and/or service mark. Infringement and/or misappropriation of Microsoft’s copyrights, advertising ideas, style of doing business, slogans, trademarks and/or service mark in defendants’ advertising is also alleged.

Microsoft asserts that in December 2012, defendants were found to have distributed computer systems with unauthorized copies of Windows XP installed on them. Microsoft asked defendants to stop making and distributing infringing copies of Microsoft software but claims that additional computers with unauthorized copies of Windows XP were subsequently distributed by defendants. Microsoft claims that such distribution of counterfeit and infringing copies of their software — along with related infringing items — is ongoing.

The complaint lists the following counts:

· First Claim [Copyright Infringement – 17 U.S.C. § 501, et seq.]

· Second Claim [Trademark Infringement – 15 U.S.C. § 1114]

· Third Claim [False Designation Of Origin, False Description And Representation –

· 15 U.S.C. § 1125 et seq.]

· Fourth Claim [Indiana Common Law Unfair Competition]

· Fifth Claim [For Imposition Of A Constructive Trust Upon Illegal Profits]

· Sixth Claim [Accounting]

Microsoft asks that the court adjudge that the defendants have willfully infringed its federally registered copyright; that the defendants have willfully infringed several of its federally registered trademarks and one of its service marks; that the defendants have committed and are committing acts of false designation of origin, false or misleading description of fact, and false or misleading representation against Microsoft; and that the defendants have engaged in unfair competition in violation of Indiana common law.

Microsoft seeks damages, an accounting, the imposition of a constructive trust upon defendants’ illegal profits, and injunctive relief.

Practice Tip: Microsoft has named as defendants both the business entity and the individual who has been identified as related to Mister HardDrive as “an owner, operator, officer, [or] shareholder, [who] does business as and/or otherwise controls” the business. A corporate officer, director or shareholder is, as a general matter, personally liable for all torts which he authorizes or directs or in which he participates, even if he acted as an agent of the corporation and not on his own behalf.

June 13, 2013

Bruce Lee’s Daughter Sues Regarding 1965 Bruce Lee Screen Test

By Overhauser Law Offices, LLC

Indianapolis, Ind. — Copyright lawyers for LeeWay Media Group, LLC of Los Angeles, Calif. filed a declaratory judgment suit against Laurence Joachim of New York, N.Y. and Los Angeles, Calif. and Trans-National Film Corporation of New York in a copyright dispute over the use of portions of Bruce Lee’s 1965 screen test in the 2012 documentary “I Am Bruce Lee.”

Bruce Lee, widely considered to have been one of the most influential martial artists of all time, was also an actor and filmmaker. He is most famous for his roles in the films The Big Boss (1971), Fist of Fury (1972), Way of the Dragon (1972), Enter the Dragon (1973) and The Game of Death (1978). Lee was the first celebrity to be cast in major motion pictures after his death.

Lee completed his first Hollywood screen test in or about 1965. It is over eight minutes long and, according to LeeWay Media, has been used freely in many productions over the intervening decades. It is allegedly available for viewing on such sites as youtube.com.

A documentary about Lee entitled I Am Bruce Lee was produced by LeeWay Media, a company founded by Lee’s daughter Shannon Lee. It was released and aired on Spike TV in early 2012. Approximately 91 seconds of the 1965 screen test were included in the documentary. Prior to including the material from the screen test, LeeWay Media searched to determine whether the screen test was copyrighted. It concluded that the material was in the public domain.

LeeWay Media was contacted in July 2012 by Joachim, who claimed to own the copyright to the screen-test footage. He asserted that his copyright had been infringed. Negotiations ensued, but the dispute was not resolved. Among other issues, LeeWay Media asserted that it had requested but not received any relevant copyright-ownership documentation from Joachim.

In May 2013, Joachim informed LeeWay Media that, unless a six-figure settlement fee was paid, he would sue for violations of federal copyright law; federal law for unfair competition; and Indiana and California state law for unfair competition. LeeWay Media instead filed suit against Joachim and Trans-National Film under the Declaratory Judgment Act, asking the court to declare, inter alia, that LeeWay had not committed copyright infringement.

The complaint asks the court for the following:

· Declaration of No Valid Copyright

· Declaration of No Standing

· Declaration of No Copyright Infringement

· Declaration of No Unfair Competition

LeeWay Media also asks for attorneys’ fees and costs; and for a declaration that the claim of copyright infringement and unfair competition are in bad faith and, as such, should be sanctioned.

Practice Tip: In 1994, the Supreme Court addressed the issue of fee shifting in copyright cases in Fogerty v. Fantasy, Inc. Since then, the federal circuit courts have taken a variety of approaches to Fogerty and its statutory underpinning, 17 U.S.C. § 505. The Seventh Circuit is among the most willing of the circuits to shift fees, stating in Riviera Distributors, Inc. v. Jones, “Since Fogerty we have held that the prevailing party in copyright litigation is presumptively entitled to reimbursement of its attorneys’ fees.” This, perhaps, provides some insight into the rationale for a California plaintiff to sue citizens of California and New York in an Indiana court.

May 23, 2013

Keystone Management and Lockridge Sue Alleging Copyright Infringement of Architectural Work

By Overhauser Law Offices, LLC

Indianapolis, Ind. — Copyright lawyers for Keystone Management Systems, Inc. f/k/a Keystone Builders Resource Group, Inc. (“Keystone Management”) and Lockridge Homes-Indianapolis, LLC (“Lockridge”), both of Richmond, Va., filed a copyright infringement lawsuit alleging William Clyde Moore, Jr. (“Moore”) and Carol Cooper (“Cooper”), d/b/a DrafTech, both of Indianapolis, Ind., infringed the copyrighted work “Birkshire II” (architectural work: 1-396-233; and technical drawings: VA 1-396-224), which is registered with the U.S. Copyright Office.

Keystone Management is in the business of creating, designing, producing, distributing and marketing original architectural working drawings, architectural works and related technical drawings (“the Keystone Designs”). Lockridge is in the business of constructing, marketing and selling distinctive single-family residential homes. Keystone Management has granted to Lockridge the right to use the Keystone Designs.

Moore allegedly asked to purchase one of the Keystone Designs but no agreement was reached. He also allegedly discussed various home plans with Lockridge for the purpose of constructing a single-family home on his property. As a part of this discussion, Lockridge provided Moore with a rendering of the floor plan for the Birkshire II design. Moore then allegedly provided these plans to Cooper for the purpose of constructing a home in the Birkshire II design. Construction is either underway or completed.

Keystone Management and Lockridge sued in the Southern District of Indiana. They list two counts in their complaint: copyright infringement and unjust enrichment. They seek an injunction; impoundment and destruction of any homes built from the Keystone Designs; for damages up to $150,000 for each infringement; costs and fees.

We have blogged about similar cases here, here and here.

Practice Tip #1: Copyright protection extends to any architectural work created on or after December 1, 1990, but architectural designs embodied in buildings constructed prior to that date are not eligible for copyright protection.

Practice Tip #2: The second claim, for unjust enrichment, is preempted by The Copyright Act.
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May 8, 2013

Malibu Media Sues Twenty-Eight Additional “John Doe” Defendants for Copyright Infringement

By Overhauser Law Offices, LLC

Indianapolis, Ind. — Malibu Media, LLC of Los Angeles, Calif. has sued twenty-eight “John Does” for copyright infringement in separate complaints filed in the Northern District of Indiana and Southern District of Indiana.

Copyright lawyer Paul Nicoletti is again in federal court on behalf of Malibu Media. The company has filed twenty-eight similar lawsuits claiming copyright infringement. The “John Doe” defendants allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material.

We have previously blogged about Malibu Media here and here. We have also blogged about some of the other copyright-infringement litigation filed by Paul Nicoletti here.

Malibu Media seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of each defendant; an award of statutory damages of $150,000 per infringed work and reasonable attorneys’ fees and costs.

Practice Tip: The actions of companies such as Patrick Collins and Malibu Media have been called “extortionate” and, in at least one case, a class action suit has been filed against these “trolls.” The issue of “trolls” has also caught the attention of at least one U.S. lawmaker. Senator Charles Schumer has proposed legislation wherein the U.S. Patent and Trademark Office would review patent infringement suits before they could be filed in court. Of course, such legislation is not directly relevant to actions sounding in copyright, such as the multiplicity of lawsuits filed by Malibu Media. It may, however, sound a warning bell that tolerance of the questionable activities of intellectual-property trolls of all varieties is wearing thin.

April 1, 2013

Indiana Court of Appeals Holds that Forfeiture for Fraud in the Form of Copyright Infringement Requires Nexus Between Fraud and Forfeited Property

By Overhauser Law Offices, LLC

Indianapolis, Ind. – The Indiana Court of Appeals granted Indiana’s petition for rehearing and reaffirmed its January ruling in favor of defendant Michael Curtis that a conviction for fraud in the form of copyright infringement was, by itself, an insufficient predicate for forfeiture.

Curtis was charged with four counts of Class D felony fraud for selling pirated movies out of his truck. He pleaded guilty to one count of fraud, which was entered as a misdemeanor, and the remaining charges were dropped. The state also filed a complaint for forfeiture of Curtis’s truck under Indiana Code § 34-24-1-1(a)(1)(B) (2009), which allows the seizure of vehicles “if they are used . . . to transport . . . stolen [IC §35-43-4-2] or converted property.” The trial court granted the forfeiture.

The Indiana Court of Appeals reversed the decision, holding that fraud in the form of copyright infringement was neither garden-variety theft nor conversion and, thus, was not within the scope of the forfeiture statute. We blogged about that decision here.

The state asked for and was granted a rehearing. It argued that Yao v. State, 975 N.E.2d 1273 (Ind. 2012), required a different outcome. The appellate court disagreed, stating that, while Yao “might support the proposition that pirated movies constitute stolen property,” it failed to answer the question of forfeiture. On that issue, the court looked to Katner v. State, 655 N.E.2d 345 (Ind. 1995).

In Katner, the Indiana Supreme Court reversed the forfeiture of a vehicle predicated on an empty container in the possession of the driver that was found to have cocaine residue. There, the trial court had ordered the defendant’s vehicle forfeited under a statute allowing forfeiture where a vehicle was used to transport a “controlled substance for the purpose of. . . [p]ossession of cocaine.” The Court held that the state had not met its burden under the forfeiture provision to show a nexus between the property to be forfeited and the underlying offense.

The appellate court in this case held that such a nexus analysis was also appropriate for the forfeiture provision which applies to stolen or converted property. As the state had apparently had not shown a nexus between the use of the truck and the sales of the pirated movies, the court affirmed its earlier decision.

Practice Tip: It looks like Curtis can keep his truck. However, in the January decision, the appellate court suggested that legislation would likely be required to allow forfeiture in cases involving copyright infringement. In contrast, this current decision seems to hold that, should the required nexus between property and copyright infringement be proven at trial, a forfeiture statute could be used to seize property involved in that infringement.
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March 15, 2013

Klipsch and Audio Products International Sue Monoprice for Patent, Trade-Dress and Copyright Infringement

By Overhauser Law Offices, LLC

Indianapolis, Ind. – Klipsch Group, Inc. (“Klipsch”) and Audio Products International Corp. (“API”), both of Indianapolis, Ind., have sued Monoprice, Inc. (“Monoprice”) of Rancho Cucamonga, Calif. alleging patent infringement, trade dress infringement, unfair competition and copyright infringement.

In an eight-count complaint, intellectual property attorneys for Klipsch and its subsidiary API allege that Monoprice has been engaged in manufacturing, importing, selling and/or offering to sell a system entitled “5.1 Hi-Fi Home Theatre Satellite Speakers & Subwoofer” which is a less expensive “knock-off” of plaintiffs’ “ENERGY® TAKE CLASSIC™ 5.1” (“Energy Take Classic 5.1”) home theater system.

Count I of the complaint alleges the infringement of API’s Patent No. 6,725,967 (“Low distortion loudspeaker cone suspension“; also called the “‘967 Patent”) which was issued by the U.S. Patent Office in 2004.

The system has apparently been well received, garnering positive reviews and selling well. In Count II, “Trade Dress Infringement and Unfair Competition,” it is alleged that API has continuously promoted the Energy Take Classic 5.1 system and its predecessors and that, as a result of the commercial success of the systems, the systems’ trade dress has acquired secondary meaning among relevant consumers as an identifier of the source of the Energy Take Classic 5.1 system. The complaint further alleges that Monoprice’s conduct is causing confusion among consumers as to the affiliation of Monoprice with API and as to the origin of Monoprice’s goods.

Counts III through VII [NB: this should have been “III through VIII”; “Count III” was enumerated as a separate count twice in the complaint], all pertain to copyright infringement. More specifically, it is alleged that Monoprice has violated the copyrights of:

· the Energy Take Classic 5.1 Home Theatre System as a whole

· the Energy Take Classic 5.1 Satellite Speaker

· the Energy Take Classic 5.1 Center Channel Speaker

· the Energy Take Classic 5.1 Subwoofer Speaker

· the Energy Take Classic 5.1 Subwoofer Backplate

· the Energy Take Classic 5.1 Owner’s Manual

The complaint lists 14 separate requests for relief [NB: these appear, upon first count, as 13; however “request for relief” letter “k” is listed twice]. Among these are requests for judgments against Monoprice for infringement of the ‘967 Patent, trade-dress infringement, unfair competition and copyright infringement. API seeks compensatory damages and, for willful and deliberate wrongdoing by Monoprice, statutory damages up to treble the actual amount found or assessed by the court. API also asks the court to enjoin infringing behavior by Monoprice. Finally, it asks for attorneys’ fees, costs and expenses.

Practice Tip: There is certainly some overlap between design-patent infringement and copyright infringement. However, the multiple counts of copyright infringement for speakers and similar “original work[s] of authorship” – all of the applications for which were filed on February 22, 2013 – attempt to proceed under copyright law against alleged infringements that seem more appropriately considered to be a matter of design-patent law. Proceeding under copyright law, however, does have two significant advantages: a liberal filing period and a substantially longer period of protection. Many products are brought to market without having filed for a design patent. If the application for such a patent is not filed within one year of the public offering or sale of the products, the statutory bar under 35 U.S.C. § 102 will prevent the design patent from being issued. Copyright has no such strict application deadline. Additionally, the 14-year life of design-patent protection is in stark contrast to the protection available under copyright law to a corporation for a work-for-hire, which can extend over 100 years.

March 5, 2013

Court Refuses to Quash or Modify Subpoena Designed to Identify Alleged Infringer of Copyrighted Movie

By Overhauser Law Offices, LLC

Indianapolis, IN – The Southern District of Indiana ruled in favor of Plaintiff Patrick Collins, Inc. by denying the motion of pro se Defendant John Doe No. 7 to quash or modify Plaintiff’s subpoena.

In a lawsuit originally styled “Patrick Collins, Inc. v. John Does 1 – 13,” Patrick Collins, Inc. of Canoga Park, California (“Patrick Collins”), alleged direct and contributory infringement by 13 then-unidentified individuals including John Doe No. 7. The suit was filed by copyright attorney Paul Nicoletti.

By motion, Dustin Hillman (“Hillman”), identifying himself only as “John Doe 7,” asked the court to quash or modify the subpoena seeking to compel his internet service provider to provide his real name to the Plaintiff, stating that “such actions violate right to privacy and the disclosure of such matters may result in wrongful or unjust incrimination.”

Hillman attached for the court’s review an article which concluded that a common approach for identifying users infringing copyright law using BitTorrent (via the Internet) was not conclusive. He then asked the court to require Plaintiff to provide further information about its methods of identifying defendants and proof of the reliability of those methods. “Hardly a day goes by,” said Hillman, “that the news does not contain a story where a computer system containing highly confidential data has been hacked, spoofed and infected by malware.” He asked for the subpoena to be quashed or modified on these grounds.

The court was not persuaded. It discussed those situations under FRCP 45(c)(3)(A) where a court must quash or modify a subpoena and then those situations under FRCP 45(c)(3)(B) where a court may quash or modify a subpoena. Citing the Malibu Media litigation, a similar matter which we blogged about here, the court then noted that the burden of establishing the grounds to quash a subpoena is borne by the party seeking to quash it. Hillman, it said, had made an argument denying liability based on the possibility that his IP address may have been used by someone else. Such an objection was an argument on the merits of the case and was “irrelevant and premature” in the discovery phase of the litigation.

Hillman also asked the court to require the Plaintiff to disclose its “shake down methods” of collection, how much it had collected from alleged copyright infringers, the percentage of cases settled without trial and the total costs incurred by the Plaintiff. The court was not moved by this request, either, stating that no evidence of abusive settlement tactics had been presented to the court.

Hillman’s identity was deemed “relevant information that is reasonably calculated to lead to the discovery of admissible evidence” and Hillman’s motion to quash or modify the subpoena was denied.

Practice Tip: Patrick Collins, Inc. has filed quite a few suits, including another case naming over 1,000 John Doe defendants. The company has been called a “copyright troll” on more than one occasion. The actions of companies such as Patrick Collins and Malibu Media have been called “extortionate” and, in at least one case, a class action suit has been filed against these “trolls.”

March 5, 2013

Malibu Media Sues Seventeen “John Doe” Defendants for Copyright Infringement

By Overhauser Law Offices, LLC

Indianapolis, IN – Plaintiff Malibu Media, LLC of Los Angeles, CA has sued seventeen “John Does” for copyright infringement in separate complaints filed in both the Southern District of Indiana and the Northern District of Indiana.

Paul Nicoletti, a copyright attorney, has filed seventeen nearly identical suits in Indiana federal court on behalf of Malibu Media. The “John Does” allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of copyrighted material.

We have previously blogged about Malibu Media here. We have also blogged about some of the other copyright-infringement litigation filed by Paul Nicoletti here.

Malibu Media seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of each defendant; an award of statutory damages of $150,000 per infringed work – which would total over $1 million for many defendants – and reasonable attorneys’ fees and costs.

Practice Tip: The BitTorrent protocol is a decentralized method that allows users to distribute data via the Internet, and has become an extremely popular method for unlawful copying, reproducing and distributing files in violation of the copyright laws. While the copyright infringements committed with BitTorrent once consisted mostly of music copyright violations, the adult entertainment industry has increasingly been filing suit against infringers who have used BitTorrent-based technology.

February 22, 2013

BMI and Copyright Owners Sue Carey Tavern and its Owners for Copyright Infringement

By Overhauser Law Offices, LLC

Indianapolis, IN – Copyright lawyers for Broadcast Music, Inc. (“BMI”), of New York, NY and eight other plaintiffs have sued VAT, Inc. (“VAT”) d/b/a Carey Tavern and its owners, Matthew and Valerie Schachte of Westfield, IN, for copyright infringement in the Southern District of Indiana.

In its complaint, BMI states that it has been granted the right to license the public performance rights of more than seven million copyrighted musical compositions, including the compositions at issue. The other plaintiffs are the owners of the copyrighted music that was allegedly infringed and include such artists as Dolly Parton, via her sole proprietorship Velvet Apple Music, and R.E.M., via Night Garden Music, a division of R.E.M./Athens LTD. Also plaintiffs in this case are: Sony/ATV Songs, LLC d/b/a Sony/ATV Tree Publishing, Moebetoblame Music, Sony/ATV Songs LLC, ECAF Music, Blues Traveler Publishing Corporation, and Universal Music-Z Tunes LLC d/b/a Universal Music Z Songs.

The suit, brought under The Copyright Act, alleges that the defendants infringed multiple songs in BMI’s repertoire by performing the copyrighted songs and/or causing the copyrighted songs to be performed publically in Carey Tavern. It alleges that there were seven instances of infringement, with each artist-plaintiff having at least one copyrighted song infringed by the defendants.

Plaintiffs allege that VAT has a direct financial interest in Carey Tavern, as do Matthew and Valerie Schachte. Further, it is alleged that Matthew and Valerie Schachte are officers of VAT, with primary responsibility for the operation, management and supervision of the activities of VAT.

The plaintiffs claim that further acts of infringement will injure them irreparably and ask that the court enjoin the defendant from committing further acts of infringement. The plaintiffs also seek statutory damages pursuant to 17 U.S.C. §504(c) and costs, including reasonable attorneys’ fees.

Practice Tip #1: BMI has a history of actively pursuing litigation in cases where copyrighted songs were performed in bars or restaurants without authorization.

We have previously blogged about BMI:

– BMI Sues Indianapolis Bar for Copyright Infringement of Honky Tonk Women

– BMI Sues Elkhart Bar for Copyright Infringement of Achy Breaky Heart and Other Songs

– BMI Sues Fishers Bar for Copyright Infringement of Counting Crow’s Mister Jones and Other Songs

– Broadcast Music, Inc. et al Sues Bertee’s Inc. et al for Copyright Infringement of Musical Composition

– BMI Sues Diamond Investments Inc. D/B/A The Juke Box Live for Copyright Infringement of Eight Songs

– BMI Sues Olive’or Twist Bar for Copyright Infringement of Unlicensed Performance of Five Songs

– BMI sues Shenanigans for Infringement of Song Copyrights

– BMI Sues R House of Brews for Musical Composition Copyright Infringement

– BMI Sues Bugsy’s Entertainment Group for Copyright Infringement

Practice Tip #2: The plaintiffs have sued not only the business entity but also its two owners as individuals. Copyright laws allow an officer of a corporation to be held liable for the corporation’s copyright infringement if the officer contributes to the infringement by inducing or encouraging the infringement. An officer can also be liable for copyright infringement if the officer supervises the infringing conduct and has a direct financial benefit from the infringement.

January 29, 2013

The World Trade Organization Suspends United States Intellectual Property Rights in Retaliation for Trade Restrictions Deemed Improper Under the General Agreement on Trade in Services

By Overhauser Law Offices, LLC

Geneva, Switzerland – The World Trade Organization (“WTO”) has granted its permission for the twin-island nation of Antigua and Barbuda (“Antigua”) to disregard intellectual property rights granted by the United States (i.e., patents, copyrights and trademarks). The decision follows nearly ten years of negotiations and litigation pursuant to a 2003 complaint to the WTO by Antigua.

In the United States, there are three separate federal laws (the “Wire Act,” the “Travel Act” and the “Illegal Gambling Business Act”) and various state laws promulgated by Louisiana, Massachusetts, South Dakota and Utah that prohibit certain means of delivering gambling services, most particularly the interstate delivery such services. The dispute centered on the conformance of these laws with an international trade agreement when the laws restricted online gambling services offered in the U.S. by Antigua. [NB: Other WTO members participated as complainants but, by 2009, the U.S. had negotiated agreements with each of them.]

Via its attorneys, Antigua alleged that, together, the federal and state restrictions amounted to discrimination against foreign companies and constituted a breach of the United States’ agreement under the WTO’s General Agreement on Trade in Services (“GATS”). Antigua stated that its economy, which had, without the restrictions, included a substantial volume of online gambling services offered to the residents of the U.S., had been significantly damaged.