Entertainment Law & Business

Prof. Kettle

INTRODUCTION - SPEECH FOR FUN AND PROFIT

What is Entertainment Law?

1. Contracts (K):
a. Express
b. Implied
c. Quasi-
(d. Breach of confidentiality or fiduciary duty)
2. Intellectual Property (IP):
a. Copyright ()
b. Right of Publicity (ROP) H#1, p8
c. TM, SM registration ()
d. Unfair competition
e. Misappropriation of ideas (tort)
f. Patents
3. Labor/Employment Law
4. Criminal Law
5. Immigration
6. First Amendment Law (free speech)
7. Alternative Dispute Resolution
8. Bankruptcy
9. Corporation and Small Business Law
10. Torts:
a. Misappropriation of ideas, name, image, likeness, etc. for commercial
advantage
b. Tortious interference with K
c.
11. Privacy (Prosser see H#1, p8):
a. Misappropriation for commercial advantage
b. False light
c. Intrusion
d. Disclosure of private facts
12. Trusts & Estates
13. Tax
14. Antitrust
15. Securities, SEC, Blue Sky Laws
16. Administrative Law
17. Internet Law

Entertainment Includes: Movies, Music, TV/Cable, Radio, Sports, Books, Live Stage, Video
Games, Internet, etc.
Entertainment products are the largest export from the United States

PROLOGUE SPEECH FOR FUN AND PROFIT

Part I Speech
Part II Technology (p2)
Part III Collaboration (p3)
Part IV Economics (p4)
Epilogue International Dimensions, Lawyering (p5)
I. SEX AND VIOLENCE IN ENTERTAINMENT AND THE LAW

- 75-80% of Americans believe that sex and violence inspires and teaches others (attracts
others to that behavior and numbs them to the consequences)
- Hate speech and fighting words are generally not allowed, but who should be the
judge?

A. FIRST AMENDMENT p10

Mutual Film Corp. v. Industrial Comm. of Ohio, U.S. (1915) - p10:

- Court said that, as a profit-oriented industry, the entertainment world was not entitled to
a constitutional guarantee of free speech.

Joseph Burstyn, Inc. v. Wilson, U.S. (1952) p11:

Film by Roberto Rossellini, The Miracle, was seen as sacrilegious, as a poor simple-
minded girl believes she impregnated by St. Joseph. The film received mixed reviews. The
Court held that under the First and Fourteenth Amendments, a state may not ban a film
based on a censors conclusion that it is sacrilegious.
- Extremely important Supreme Court case that established 1st Amend rights in the
entertainment industry.
- The importance of motion pictures as an organ of public opinion is not lessened
by the fact that they are designed to entertain as well as to inform. p15
- What is one mans amusement, teaches anothers doctrine. p15
- Before Burstyn, there was no First Amendment protection for for-profit
entertainment (or commercial speech) see Mutual Film above
- States acted as censors

Restrictions on the First Amendment:

a. Privacy
b. Intellectual Property
c. Advertisement
d. SEC, FTC, FDA
e. Libel, slander
f. Trade secrets
Not protected by the First Amendment:
a. Obscene speech (see Miller Test)
b. Libel, slander, misrepresentation, perjury, false advertising, solicitation of crime,
complicity, conspiracy
c. Speech or writing used as an integral part of conduct in violation of criminal
statute(s)
d. Speech directed at, or with purpose of, inciting or producing imminent lawless
action and is likely to produce such action (see Brandenburg test)

Miller Test for Obscenity:

1. Whether average person, applying contemporary community standards, would find
the work taken as a whole appeals to the prurient interests
2. Whether the work depicts or describes in a patently offensive way, sexual conduct
specifically defined by the applicable state law
3. Whether work taken as a whole lacks serious literary, artistic, political, or scientific
value
- First Amendment does not protect lawlessness or unlawful conduct
- Pornographic magazines can be protected if they have literary, artistic, political, or
scientific value
First Amendment; Free Speech

- Obscene Speech (Miller Test)

- Indecent Material
- Protect the Children Doctrine:
a. Children in the audience may be reasonably shielded from indecent
material
b. Safe Harbor Provision: indecent material is allowed after child hours
(TOD restriction).
- 12AM (midnight) to 6AM; or
- 10PM to 12AM if station signs off at 12AM
c. Other time of day (TOD), audience, medium restrictions (restrictions
vary).
- TOD restrictions are mostly concerned with children in the audience and
helping parents control the content that children hear
- Only for broadcast media; subscription media is not limited (some
control is already in place b/c must pay to get service).
- However, no duty to deprive the masses to protect the troubled few
- Thus, allows protects persons interested; First Amendment may also protect
the right to hear
- All bargaining takes place in the shadow of the law

- Intrusive Material (privacy: right to be left alone)

- First Blow v. Knockout (see FCC v. Pacifica)
- Privacy v. ROP

- Tort-based call to action

- Slander, libel speech
- Inherently risky and inciting speech (e.g., (a) radio broadcast that caused
listeners to rush to a scene in order to claim prize; and (b) Dominos Pizza
guaranteed 30-minute delivery were both found to cause likelihood of accidents).
- Incitement doctrine: requires incitement along with foreseeable and unreasonable
risk
- Brandenburg Test: speech directed to incite or produce imminent lawless
action and is likely to produce or incite such action.

- Speech with actual malice or Reckless disregard for truth or falsity

- Negligence liability does not offend the First Amendment

 B. ENTERTAINING SEX p29

Skyywalker Records v. Navarro, S.D. Fla. (1990) p30:

Fla. statute intended to regulate obscenity to the maximum extent allowable by the Const.
Sheriff warned all record shops that they will prosecute anyone who sells the 2 Live Crew
CD Nasty as They Wanna Be b/c obscene. Issue is whether the state law in constitutional.
- First Amend does not extend to obscene material, therefore not unconstitutional
for a state to ban obscene material.
- Court here applied the Miller Test:
1. Lyrics were found to be obscene, although the music was not. Since the lyrics
dominated the recording, the work as a whole could be considered obscene.
2. Patently offensive:
- Lyrics described sexual conduct in graphic detail
- State law proscribes portrayals of hardcore pornography
- Music recording is more intrusive than other forms of entertainment (e.g.,
books) b/c music can be played in public upon a captive audience.
3. Social Value:
- Court rejected argument that it is a comedy or a satire
- Must look at work objectively as a whole, not as a critic and not ad
hominem
- Focus is on the work itself, not its creators
- The explicit lyrics here were found to be utterly without any redeeming
social value
* All three elements of the Miller test were found against 2 Live Crew, therefore
found the work to be obscene.
- Although the work was found to be obscene, the Sheriffs actions constituted a
prior restraint, which cannot be tolerated by First Amend. Court issued a
permanent injunction against future prior restraint against any recordings.
But now that stores were on notice, they could be liable for selling obscene
material if continued to sell 2 Live Crew.
- Note that the audience is out there for 2 Live Crew: Nasty as They Wanna Be
sold over 1.7M records (Clean as They Wanna Be sold ~250K records).

Morals Clause - Contractual Out:

- Entertainer must uphold certain morality and values; if entertainer violates it, the
K may be voided.
Indemnification Clause:
- In case is entertainer violates some law or contract provision, the entertainer
agrees to indemnify his/her label, producer, etc. from any resulting damages.
 FCC v. Pacifica Foundation, U.S. (1978) p40:
George Carlins Filthy Words monologue. Father in car with 13-year-old son heard the
broadcast in the afternoon and complained to FCC. Broadcaster challenged whether Federal
Communications Commission (FCC) had the authority to ban certain types of speech over
the radio (challenged as against 1st Amend) i.e., whether the government can ban indecent
language under any circumstances.
- Court said FCC can regulate indecent language over broadcast media because:
1. Broadcast media (inc. free radio) has a uniquely pervasive presence and is
uniquely accessible to children. Government has an interest in the
[emotional and ethical] well-being of its youth and in supporting parents
supervision in their own household.
- Court found the monologue was vulgar, offensive and shocking. Does not
have to be obscene necessarily; indecent material can be restricted.
- Court rejected the argument that the monologue was political or social satire
- Government interests were found compelling in Action for Childrens
Television (ACT) (D.C. Cir. 1995) (ACT IV) p52
2. Narrow holding broadcast media only and the time of day was particularly
vulnerable to children in the audience.
- This monologue would be protected in other contexts
- Captive Audience: First Blow v. Knockout
- Before you know it is indecent, you have to hear it; but once heard, the
damage is done. Thus, government may restrict.
- Can turn the station when hear indecent material, but damage is already done -
cant un-ring a bell.

Howard Stern p50:

- Excerpts printed from Howards broadcast vulgar, shocking, offensive
indecent?
- The Stern case produced a new generic FCC standard for indecent
broadcast:
Language or material that depicts or describes, in terms offensive as
measured by contemporary for the broadcast medium, sexual or excretory
activities or organs.
- upheld in Infinity Broadcasting (F.C.C. 1987); and in Action for Childrens
Television (ACT) (D.C. Cir. 1988) (ACT I)

Record labels, publishers, studios, etc. do self-regulating through the use of warning
labels, content ratings, etc. This self-regulation was done in effort to appease political
pressure from lobbyist groups.
C. ENTERTAINING VIOLENCE p55

McCollum v. CBS, Ct. App. Cal. (1988) p57:

Teenager listened to Ozzy Osbourne and shot and killed himself. One song, Suicide
Solution, used the words get the gun, try it, try it, shoot, shoot, shoot.
- Brandenburg Test: song does not incite; there is no call to imminent lawless action.
- Depression is a common theme in music, literature, etc. and this artist is not unique
in that way. Words of songs by Ozzy speak of depression, but no call to suicide
(above song could be interpreted as a whole as pro- or anti- suicide).
- Also rejected b/c no incitement the claim that A&R Records arranged songs on the
album such that there was a build-up of the depression that culminates with
Suicide Solution.
** Absent incitement, cannot meet Brandenburg test and no tort liability.

Private v. Public Figures:

- Public figures cannot say untruthful things (mere negligence standard).
- Private figures have much wider discretion: not held to absolute truth, can be
mistakes as long as not reckless or with malice.
- Public Figure for a Limited Purpose: private person may expose himself to
criticism as to a certain activity, organization, association, etc.

Foreseeability is very important to torts:

- Jenny Jones Show lost tort suit as to I Have a Crush episode (p70, #2(e)):
- Man on the panel killed another man, who revealed that he had a crush on the
panel member (weeks/months after show was taped).
- Jenny Jones was held liable b/c misled member of the panel because told him the
crush was heterosexual by lying, they showed that there was a foreseeable risk in
the homosexual surprise.

Social Value: do shows like Jenny Jones and Jerry Springer have any social value
- comedic value?
- expose socio-economic issues?

Note: Damages for breach of contract:

1. Expectation
2. Reliance
3. Restitution
First Amendment Rights of Publisher v. Public
- Concerns:
- Call to Action; Incitement to imminent violence (Brandenburg Test)
- A foreseeable and unreasonable risk
- Obscenity (Miller Test)
- Is a publisher a bona fide competitor in the marketplace of ideas?

Herceg v. Hustler Magazine, 5th Cir. (1987) p63:

14-year-old hung himself after reading and trying to duplicate description, in the article
Orgasm of Death, of autoerotic asphyxia (Hustler, opened to this article, was found at his
feet). Heading of article stated that its series Sexplay was intended to discuss the
pleasures and dangers of taboo sexual practices and were presented to inform readers, lessen
their inhibitions, and make them better lovers. The article warns of that autoerotic asphyxia
can cause death and contains the warning DO NOT ATTEMPT.
- Majority overturned a jury verdict at trial court for $169,000 b/c majority found that
this article did not meet Brandenburgs incitement standard i.e., harm for which
there is no legal remedy.
- Concurring (on procedural grounds) and Dissenting (on substantive grounds) opinion
by Circuit Judge Edith Jones was printed. Dissent believed that a cause of action was
defensible under tort and constitutional grounds (factors on p67):
A. Obscenity
- By law, this article probably not obscene (but any given issue may be) but
Hustler is not a bona fide competitor in the marketplace of ideas; it is largely
pornographic, whether or not technically obscene. Thus, probably at least
indecent, and could be regulated.
B. Foreseeable Harm
- Target audience is claimed to be 18+, but Hustler knows that younger readers get
the magazine.
- Many warnings in the article may not be enough considering Hustler knows that
a significant portion of its readers are adolescents who are particularly
vulnerable to thrillseeking, recklessness and mimicry.
- Also, the warnings are rendered moot by the articles claims to make one a better
lover.
C. After-the-fact liability, not prior restraint
- Tort liability would be based on harm directly caused by the publication in issue.
- Any chilling effect on publishing would be the result of a legitimate state interest
in protect[ing] society from loss of life and limb.

Questions that need to be asked:

- Child/teen v. adult: how much of a difference? Are particularly vulnerable teens
part of the troubled few for which the law cant protect?
- Would a reasonable person know not to attempt the depictions in this magazine?
- Does the dissents distinction as pornographic matter? Would a reasonable
person give less credence to Hustler as an information guide, or more credence b/c
focused on sex?
- What if article was in an accepted magazine, such as Ladies Home Journal?
These type of magazines publish stories on different dangerous activities
such as hang gliding.
- Leads to a slippery slope argument: where do you draw the line?
In the majority of cases, the First Amendment provides publishers/producers with
strong, but not absolute, protection from tort liability.
- The Encyclopedia of Mushrooms Case (p69 #2(b)):
Mushroom guide that identifies and describes which mushrooms are safe to eat.
Readers eat mushrooms that were supposed to be safe, but were so poisonous that they
required liver transplants. Is publisher strictly liable for a defective product? Usually
not First Amend.
- How to Commit a Perfect Murder Case
Only case where publisher was held liable for foreseeability - not insulated by the
1st Amend.
- Besides books and depressing music, casebook also mentions TV movies (Born
Innocent), films (e.g., Natural Born Killers) and gangsta rap. p68-71

Harming oneself (self-mutilation or suicide) rather than harming others may be distinguished
in criminal law, but usually no distinction as to tort liability.

FBI Study said TV/movies/etc. do not cause the youth to be more violent:
- copycats are among the troubled few (page ??)

Insurance
- Insurance will usually cover error and omissions, such as good faith mistakes in
research.
- Insurance would probably only indemnify publishers from tort liability if publishers
paid high premiums.
- As a lawyer, you should make sure:
a. Your talent investigates whether his publisher is covered by insurance;
b. Your tort client investigates whether opposing party is covered by insurance; and
c If they are be sure to file before insurance deadline.
 D. SELF REGULATION BY THE ENTERTAINMENT INDUSTRY p78

Ratings
1. Music (p78):
- RIAA: Recording Industry Association of America
- single warning label: Parental Advisory Explicit Lyrics
- PMRC: Parents Music Resource Group (lobbyist for ratings, included Tipper
Gore)
2. Movies (p79-81):
- MPAA: Motion Picture Association of America
- MPAAs CARA: Classification and Rating Administration
- G, PG, PG-13, R, NC-17
- NATO: National Association of Theater Owners
- Jointly administers the MPAA rating system
- Appeals by producers over the rating received:
1. Ask for reasons for rating, and attempt to edit the film to meet criteria for
rating that you wish to have.
2. Appeal to the MPAA Appeal Board, which consists of 14-18 members
from the MPAA and NATO
3. Release the film un-rated (if producer in not a member of the MPAA
MPAA members by contract must submit film)
- MPAA has been criticized for 1) lack of meaningful standards; 2) criteria are
solely based on parenting, not psychology or film-making criteria; and 3)
especially for its preoccupation with sex as compared to violence.
3. Games (p90-91):
- IDSA: Interactive Digital Software Association
- IDSAs ESRB: Entertainment Software Rating Board, headed by a specialist
in child psychology
- EC (Early Childhood), KA (Kids to Adult some violence), T (Teen
violence and strong language), M (Mature - violence and sex scenes),
AO (Adults only - graphic sex and violence)
4. Internet
- COPA: Children On-line Protection Act

General standard: are ratings arbitrary and capricious?

Ratings are useful, but depend on:

1. Enforcement by theaters
2. Independence from industry pressure (free from clout pressure and bribes)
3. Consistency in the standards
 Miramax v. MPAA, N.Y. (1990) p81:
Miramax at this time was still a relatively small independent film distributor. Tie Me Up!
Tie Me Down! received an X-rating and was told that must cut out sex scene(s) to get the
R-rating. Distributor asked the court to find the rating arbitrary and capricious and replace
with R-rating. Distributor argued that an X-rating limited the theaters that would carry the
film and thus carried a stigma that would affect who would see it. The MPAA argued that
the court had no legal authority to reverse its movie ratings.
- MPAA Ratings:
- Anonymous parents are on the board. Ratings are supposed to be according to
parental values. The only mandatory standards are dependent on drugs,
sex, language, and graphic violence (less mandatory for violence than sex).
- MPAA is the only body authorized to use the federally registered certification
marks: G, PG, PG-13, R. Persons wishing to get mark must pay MPAA and
submit movie for review.
- X was not registered and court found that it had been taken by the porn
industry and lost its original connotation (No one under 17 admitted).
- No remedy as a matter of law for Miramax:
- Court said that ratings are not equivalent to government censorship, but industry-
imposed censorship is a form of censorship nevertheless.
- However, MPAA ratings are certification marks and the MPAAs evaluation
can only be overturned if: a) arbitrary and capricious; or b) in bad faith (this
is the standard of review for determination of a private, nongovernmental
organization).
- Court warned MPAA that it should look to improve its system and avoid
stigmatizing films of an adult nature, but which are clearly not pornographic
(this case is among those that led to the new MPAA rating, NC-17).
- Court also warned that MPAA creates an illusion of concern for children by
imposing censorship, but still allows the marketing of exploitive and violent films
with an industry seal of approval.

Internet Filters:
In public libraries, these filters are used with the objective of protecting kids, but:
- May block adult from viewing some content
- May block legitimately clean sites that mention sex or body parts (e.g., medical
sites)
- COPA: Children On-line Protection Act

(??????????????????????????????)
7th Circuit (????upheld/struck down??????) a state law restricting the use of certain video
games within an arcade.
(??????????????????????????????)
II ENTERTAINING THE PUBLIC WITH INDIVIDUAL LIVES

Defamation
- Elements:
1. Statement about plaintiff
2. Heard by another
3. False
4. Harmed plaintiffs reputation
- Types:
a. Libel (printed/written)
b. Slander (spoken)
- Standard:
- at common law, defamation standard was strict liability (no regard was given to
intent, knowledge or good faith) NY Times v. Sullivan was landmark case that
changed this
i. Public Figure: actual malice (knowledge or reckless disregard for the truth)
ii. Private Individual: negligence
- To get punitive damages, however, actual malice is necessary
iii. Public Person for Limited Purpose:
a. Isolate and define public controversy
b. Define plaintiffs role therein
c. False statements must be germane to plaintiffs role
----------- depending on jurisdiction, may also have following two prongs:
d. Degree that plaintiff injected self into controversy
e. Plaintiff involvement with the media

Infliction of Emotional Distress (Mental Battery)

- Elements:
1. Intentional
2. Reckless disregard (little or no thought given)
3. Extreme and outrageous
4. Extreme distress (must be severe)

Privacy Tort (Prosser)

a. Unreasonable intrusion on personal solitude (1st amend is not a license to trespass)
b. Public disclosure of embarrassing private facts
c. False light portrayals
d. Appropriation of name, image, likeness for commercial purposes (ROP)
A. DEFAMATION p96

NY Times v. Sullivan, U.S. (1964) summary on p97:

Advertisement describing non-violent demonstrations during civil rights movements, and the
wave of terror such demonstrations were subject to by public officials in Alabama. Some
statements made about the officials was found to be incorrect and the plaintiff sued stating
that the ad wrongfully implied that he was guilty of misconduct.
1. Public figures are subject to free speech criticism political speech is highly protected.
Public figure plaintiff must show that statement(s) were made with actual malice:
with knowledge or with reckless disregard for the truth.
2. Court must examine the entire record to ensure that a trial judgment does not
impinge upon First Amendment rights.

Johnson & Johnson v. Avon

J&J claimed that their insect repellant was government approved, but Avons Skin So Soft
was not. Although this was true, it didnt mention that Avon didnt need to be approved b/c
not an insect repellant. The court found defamation b/c the audience perceived this to mean
that Avon needed government approval but didnt get it.
- Truth is not necessarily a complete defense. The question may be what the listener
reasonably perceives as the statement.

Ways to prevent defamation suits:

1. Pay for the rights to tell a persons story. You dont have to do this, but you run
the risk of a defamation suit if the story isnt accurate. You especially want to do
this if subject is a private individual, b/c standard is mere negligence (although
punitive damages standard is actual malice), rather than actual malice if public
figure.
2. Fictionalize the story. The more outrageous the portrayal, the more protection b/c
unlikely the audience will believe that the depiction is true (see Falwell case).
3. Insurance (errors and omission E&O). Wont prevent suit, but can cover you
for damages.

Falwell lost his suit against Hustler magazine because the portrayal was so outrageous
(drunken and incestuous) that the public would never believe it was true.

Docudramas have wide latitude in dramatization

Misquoting an individual, even if portraying the gist of what the person said, is defamation.
The author can say the same thing without quotes.

The different standards for private and public figures is mostly due to the fact that public
figures have wide access to the media while private individuals do not. Public figures can
thus fight speech with speech.

Filmmakers can generally rely on books without making their own investigations.
Davis v. Constantin Studios, SDNY (1987) p101:
Film Missing was fictionalized version of the book Execution. Filmmakers relied on
book written by author (whose book had never been challenged in four years on the market).
Actual American in charge of Chilean mission says book falsely shows that he ordered, or
approved the order, the execution of an American citizen in Chile because he knew too
much.
- The issue on the motion is not the truth. Issue is whether the filmmakers
intentionally portrayed such a defamatory suggestion, knowing that it was false
or with serious doubts of its truth. The docudrama was fictionalization of the
book, but sufficiently close to the truth that it did not constitute actual malice.
- First Amendment does not require literal truth in docudramas.

B. INFLICTION OF EMOTIONAL DISTRESS p108

Hustler Magazine v. Falwell, U.S. (1988) p108

Falwell tried to bring emotional distress suit when his defamation case was dismissed. The
jury awarded damages, but the Supreme Court reversed: many things done with motives
that are less than admirable are protected by the First Amendment. Bad motive in other tort
areas may be controlling, but public/political criticism is protected by the First Amendment:
political cartoons and caricatures by their very nature are often based in embarrassing events
or traits.

However, the claim of intentional infliction of emotional distress does increase a private
figures ability to secure redress.

C. PRIVACY: INTRUSION ON SOLITUDE

Galella v. Onassis, (2d Cir. 1973) p114:

Legitimate social needs warrant some intrusions on a persons privacy. However, one cant
justify abusive and intruding presence in order to get pictures/info of de minimis public
importance.

Miller v. NBC (2d Cir. 1986) Reality TV, p115:

NBC crew accompanied paramedics to plaintiffs home and filmed paramedics working on
plaintiffs husband who eventually died. They aired the footage on a program, without ever
seeking plaintiffs consent (for filming or airing). Plaintiff claimed she relived her husbands
death and won suit for intentional infliction of emotional distress. NBC blurred out victims
face on TV, but plaintiff recognized him from body, clothes, etc. First Amendment does
not protect trespass. This was an unreasonable intrusion into someones personal
solitude. The news/press cant invade someones private home.
- Offensiveness Factors: 1) degree of intrusion; 2) context; 3) conduct; 4) circumstances
surrounding the intrusion; 5) intruders motives and objectives; 6) the setting into which
he intrudes; 7) the expectations of those whose privacy is invaded. (p116)

Food Lion v. ABC (M.D.N.C. 1995) p121:

Food Lion Supermarkets sued the press for using hidden cameras and won under trespass.
Although the information was newsworthy and valuable to society, still no license to
trespass.
- ABC is appealing, believes this ruling will operate as a huge deterrent to effective
journalistic investigation.
D. PUBLIC DISCLOSURE OF EMBARRASSING PERSONAL FACTS p124
- Not a claim of falsity; facts are true, but personal and embarrassing

Ross Test:
Plaintiff can recover if:
1. Publicity was given to matters concerning private life
- Have these facts been previously published or made public?
2. The publication would be highly offensive and objectionable to a reasonable
person of ordinary sensibilities
- I.e., is it shocking?
3. The matter is not of legitimate public interest or concern
- Is there a legitimate public interest in knowing the facts?

Ross v. Midwest Communications, 5th Cir. (1989) p126:

Man was accused of three rapes with similar MOs. He was convicted of two, but
acquitted on the third when the victim (P, Marla Ross) said it was not him during a lineup.
The person who raped P was never caught. News documentary had theory that since one
victim said it wasnt him, he should be acquitted of all three crimes. The documentary
named P in its story, and showed the home she lived in at the time of the rape, without
seeking her consent. P and her husband sued for invasion of privacy: public disclosure of
embarrassing personal facts.
Ross Test:
1. Matters Concerning Private Life
- Her name was on the police record. State could have sealed this information
in the interest of protecting victims privacy and welfare, but it did not.
- However, this is a narrow holding: court does not say that the victims name in a
rape case is always a matter of public concern that trumps victims right to privacy.
States may still protect the privacy of rape victims. Her name lost its privacy
status because of the potential false accusations, not because she was raped.
2. Highly Offensive and Objectionable . . .
- This element is usually to be judged from the standpoint of the general public,
but also should weigh against the privacy of the individual. Is the general
public ever shocked anymore? Victim and people who knew this person are
certainly more offended than an isolated public that doesnt know her or the
accused.
3. Matter of Public Concern
- The rapes and allegedly false accusations are matter for public concern. Our court
system doesnt want innocent people in jail. Therefore, if this story held any
weight, it was a matter of public concern. Name of victim gave such weight to
legitimize the story (real name helps verify the truth of the story).

Right of Privacy versus First Amendment

- State can protect the privacy of the individual; but once it is in the public record,
then the First Amendment may give protection to the information.
- Balancing Test: Need to know the truth v. Right to keep information private.

Entertainment is not a license to ruin peoples lives. But it has caused many problems
because of public disclosure.
If someone is shown on reality TV (talk shows, Cops, etc.), he has two potential
claims:
1. Public Disclosure of Embarrassing Facts
2. False Light claim if can show that you were depicted in a bad way that is untrue.
E. FALSE LIGHT PORTRAYALS p134
- Protects against untrue statements that are highly offensive to sensibilities

a. Actual Malice (public figure)

b. Negligence (private figure)

- Not allowed:
i. Imaginary incidents
ii. Manufactured dialogue
iii. Manipulated chronology

Time v. Hill, U.S. (1967) p135:

Fictionalized play was based on a real-life hostage situation. Family that said they were
treated decently by their captors and they just wanted to put the ordeal behind them.
The play depicted a much worse situation where the family was brutalized. Life
magazine wrote an article saying that the play was a reenactment and took pictures of
the actors in the house where the Hills lived at time of kidnapping.
- The Court found that the Hills were private individuals, but involved in a
matter of public concern. Thus the standard was actual malice (applies to
false light as well as defamation claims). The Court overturned the jury verdict
that the Hills had previously won (remanding for new trial under malice
standard?).
- Negligence standard was held not to apply because to hold tort liability for a
negligent misstatement would present a grave hazard of discouraging the
press from exercising its constitutional guarantees.
- Producer may have been negligent with the facts, but not done maliciously: the
play was loosely based on the hostage situation and was exaggerated for
dramatic purposes. The article should have been clear on that point.
- The Hills got a final settlement (for same amount as the jury awarded), but Mrs.
Hill committed suicide five years later.

Difference between False Light and Defamation claims:

False light: protects against true statements that are highly offensive to ones
sensibilities
Defamation: protects against true statements that are disparaging of ones reputation
F. PUBLIC FIGURES UNDER DEFAMATION AND PRIVACY LAW p139
- Protects untrue statements disparaging to plaintiffs honor/reputation

- Gertz: there is no constitutional value in false statements of fact. Only people

who benefit are entertainment brokers that sell drama and those who look to
perpetuate the lies for profit (the liar or someone who leaks the lies).

Dresbach v. Doubleday & Co., D.D.C. (1981) p141:

Man killed his parents. His brother lived with author, a summertime neighbor of the
family, for a period after the murders. Author wrote a book describing how brother cut
himself off from the murderer and cut him off from the inheritance. The book also gave
information on the family relationship before the murders: favoritism of the brother,
abuse in the home, etc.
- Brother claimed that he may at one time have been a public figure for a limited
purpose, but that was 20 years ago and now he is merely a private individual. He
sued under false light (dismissed) and public disclosure of embarrassing personal
facts (allowed to pursue, subject of this discussion).
- Court held that the material for the book did not lose its public status because
of the passage of time. Once a person becomes news, or a matter of public
concern, he remains so until the end of his days.
- However, the court said that in the interest of rehabilitation of the fallen and
the reformation of the criminal, there could be a cause of action for
unreasonable public identification of a person in his present setting referring
to earlier actions which took place at a time when the person was a legitimate
object of public interest. But such was not the case here no rehab necessary
for brother, he never committed a crime. The book was about the murderer, but
tangentially the facts of the brothers relationship with him are legitimately
interesting.
- When deciding what information is related to the matter of public concern,
there must be a logical nexus between the information and the matter of
legitimate public interest. The court will defer to a publisher to make that
decision unless there is a flagrant breach of privacy . . . where no legitimate
public interest exists.

Street v. NBC, 6th Cir. (1981) p147:

NBC movie of the week (MOTW) about a reported rape in GA in the 1930s. White
woman accused nine black men of rape (another woman involved dropped the charges).
Jury found guilty, but judge entered JNOV still, all nine ended up serving some prison
time. Movie portrays the judge as a courageous figure in the fight for civil rights and
portrays the woman as a perjurer.
- Woman claimed the movie showed her in a false light. She was a public figure at
the time, not only as the alleged victim in a high profile case, but because she
voluntarily told her story to the media. Her status as a public figure is not lost
over time she is still a public figure for a limited purpose and must meet
malice standard.

A Few Good Men was based on a true event, where screenwriters sister leaked the
transcript of the private military court martial trial. The movie and the play had a
disclaimer that any resemblance between depiction and real life were unintended and
coincidental, but it was really a dramatized/fictionalized account (but in reality, the
victim was hurt not killed, the Marines were convicted of assault ad were not
discharged, and the Marines did not cover up the commander was punished). The
Marines have not sued. Do they have a case? (p50)
 DEALPOINTS - Option Agreement for Story Rights:

- Give consent to sell private material of a person. Producer/studio will then shop the
idea around to see if anyone is interested in the story.
- Option means that if they are sold, the contract with this person gives them the first
opportunity.
- Length of option to buy is usually ~12 months and a second 12 month option at the
discretion of the studio/producer.
- Talent (the person with the story) should not let itself be stretched too far keep as
short as possible; studio will try to lock you in

- Agent usually tries for ~10% of purchase price

- Options are usually sold for anywhere from $1,000 - $25,000, or a % of purchase price.
- The first option payment usually goes towards the sale price, if story is sold
- Second option is usually higher than the first (interest generated in story) and
usually this payment does not go towards sale price.
- If producer cant find a buyer, then talent just keeps the option payment(s).

- Deal usually done in Short Form Memo:

- Option price, Royalties, etc.
- Short forms refer to other contracts (standard agreements) so be careful
- e.g., definition of net profit can be 30-35 pages
- Lawyer should always condition short form on approval of long form
agreement and terms (get a copy of long form agreement before allowing
client to sign the short form)
- Always try to bill your client in as a consultant to the book/movie/etc.
Consultants are generally compensated for each episode, paid while available for
writers/directors, and studio picks up expenses while working as a consultant
- Bill in most favored nation provisions: your client will be treated/paid as
well as other clients of the studio
- ???highest favorite nation??? copied wrong? same term or different
from above???
- Bill in spin-offs of original story: made-for-TV movies, movies, play, series,
etc.
- Always reserve right of publicity (ROP): a lot/most of potential for the money
can be here (e.g., most of New Kids on the Block money came from
merchandising).

- Options can be very lucrative (e.g., Nancy Kerrigan got %500K purchase price,
plus may have been more money based on above ROP, etc.)
III CELEBRITY PUBLICITY RIGHTS p160:

Right of Publicity (ROP) - see H#1, p8:

- Right of a celebrity/individual to control and profit from the use of his name,
image, likeness, performance, voice, biographical facts, and symbolic
representations.
A. Majority View
- Property Right (Brandeis?)
- Descends, although some states require lifetime exploitation. Also, some
states may require that celebrity file those rights by the estate in order to
preserve state and federal claims.
B. Minority View (e.g., NY)
- Privacy Right (Prosser)
- Right dies with the individual
- If possible, lawyer should forum-shop for state that best fits needs (if
representing talent, bring suit in case where ROP carries past death w/ or w/o
exploitation)

Protection:
a. State Law (see H#1)
b. Federal claim for false affiliation, false endorsement, etc.
- Lanham Act 43(a); codified at 15 U.S.C. 1125
c. Unfair competition
d. Privacy Laws (Tort)
e. Restatement (3rd) of Unfair Competition

Merchandising, Exploitation:
- Dont overexploit: could flood the market; control of image preserves its value
- Flooding may cause celebritys merchandise to go to dollar bin
- To protect from this, many celebrities put provision into K that they can buy
back, at their option, excess inventory at the manufactured price in order to
keep control
- Unlimited potential under ROP, very important to keep/reserve these
rights: keep them separate in K, dont lose through standard agreement
- Do not assign name, image, likeness, etc. away (sometimes big companies try
to hide ROP rights in a long form contract)
- Similar to TM, ROP must be controlled in order to keep rights (guard against
naked licensing). How much control does the individual have?

ROP v. First Amendment (Parody/Satire, Fair Use)

- The difference a parody and a knockoff is the difference between fun and profit
(White, p212)
- But, ROP should not hold parody/satire hostage
- (P) owner (artist) versus owner (producer/studio): who owns the ROP?

Criminal Celebrities (Son of Sam laws SOS laws)

A. EVOLUTION AND NATURE OF PUBLICITY RIGHTS p161

MLK Center v. American Heritage, GA (1982) p163:

Memorial bust of MLK, Jr. sold for $29.95. MLK Center denied ROP rights, but D sold
anyway and donated $0.90 for every bust to the Center.
- GA State law: ROP is a property right that is descendible. Therefore, ROP rights
survived MLKs death and MLKs family now controls.
- D claimed that the bust was similar to biography b/c was accompanied by a booklet
summarizing important facts concerning MLK tried to claim First Amendment
protection.
- Biographies are protected by First Amendment (as long as they do not violate
other laws: defamation, false light, etc.)
- However, that is not the case here cannot shield from liability for violation of
ROP by attaching booklet, still commercial exploitation.
- Form over content: newspapers, magazines, etc. can use biographical
facts even though newspapers are sold for profit. But cannot put
biographical facts on busts, mugs, collectible cards, etc. w/o permission.
- Cites to Palmer case where a video game used Arnold Palmer and other golfers
images and biographical facts w/o permission violated ROP.

B. PUBLICITY RIGHTS AND ENTERTAINMENT SHOWS

Zacchini v. Scripps-Howard, U.S. (1977) p171:

Human cannonball act was shown in entirety (15-seconds) on newscast. News asks
permission, it was denied, but they taped and showed anyway.
- First Amendment creates newsworthy exception for using someones image, etc.
but that does not give the media the right to use someones entire act b/c that
substantially threatens his livelihood. Why should people pay admission if they can
see it on TV? Media could have used still photo or shorter image, but cant use entire
act (or substantial portion?).

Cheers Norm & Cliff:

Airport bar has mechanical Norm and Cliff from Cheers TV show. Bar got a license
from Paramount, the owner of Cheers copyrights. However, actors sued for
exploitation of image and likeness.
- State ROP won out over federal copyright, actors ROP over characters was
retained even though shows copyright was owned by Paramount (cert. denied
by Supreme Court).

Symbolic Representation
- Bette Midler refused endorsement to sing, so company hired a backup singer that
sounded like her. ROP in CA allowed common law to protect against the imitation,
even though statute only protects against use of real voice or image). Therefore,
Bette won.
- Santanas has distinctive guitar riffs, but he doesnt own rights to the sheet music he has
played. Company hired a sound-alike to do commercials. He is suing on state ROP
common law grounds in symbolic representation versus federal copyright to the song.
Unresolved.
 Matthews v. Wozencraft, 5th Cir. (1994) p177:
Movie Rush was based on the true story of two undercover drug enforcement cops. The
male cop (P) sued the female cop (D) for money P made in selling the rights to her story.
- Misappropriation Test:
1. D appropriated Ps name or likeness for the value associated with it.
2. P can be identified from the publication/use.
3. D gained some advantage or benefit from the use.
- There is not much protection for ones life story (biographies can be written
factually or can fictionalize by using some facts about a public figure). Parties
here were both public figures for limited purpose.
- Generally, ROP case is weak in the biography context other privacy rights
are stronger (misappropriation, false light, etc.).
- However, had no case here: in addition to the fact that she took biographical facts, the
story increased the value of his story rather than reducing it (renewed interest in the
story). Misappropriation does not protect ones name or likeness per se, it protects
the value associated with them against excessive exploitation of its value.
- Ones likeness does not include general incidents from a persons life, especially
when fictionalized.

Hicks v. Casablanca Records, SDNY (1978) 181:

Fictional story written about lost period in Agatha Christies life: she once disappeared
for seven days. Author made up story that included cheating/plotting/murder/adultery.
- NY is a privacy state, rights die with celebrity (NY is a big advertising state,
especially NYC).
- NY requires all uses of name and likeness to be in writing (no oral agreements).
- Christies daughter sued for defamation, privacy rights, and ROP. Defamation and
privacy rights die with celebrity, only ROP remains (?why didnt it die?). May
have had potential defamation and/or privacy suits if Christie was still alive.
- The importance of fiction is not lessened by the fact that it entertains as well as
informs.
- First Amendment protects fictionalization unless:
1. Deliberate falsifications; and/or
2. An attempt was made to present disputed/fictional events as true.

Warren Spahn (pro baseball player) won his case where a book fictionalized his life:
1. Deliberately false and held out as true
2. Spahn was alive (may or may not have mattered)
C. CRMINAL CELEBRITIES p187

Simon & Schuster v. NY State Crime Victims Board, U.S. (1991) p189:
Son of Sam case: should criminals be able to benefit/profit from their crimes? Forty-percent
of the movies of the week are based on real-life crime. Does profit encourage crime?
- What about the victims? Civil suits are allowed against criminals, but many
criminals are indigent.
- Theory behind SOS Laws: cant prohibit criminals from receiving payment for their life
story, but can put it in escrow for five years to give victims the chance to collect
judgments from criminal before criminal has use of the money.
- State has important/compelling interests:
1. Ensure that victims are compensated by those who harm them
2. Ensure that criminals do not profit from their crimes
- But, Court said SOS law was overly broad b/c it included anyone who ever
committed a crime (whether or not they were charged, acquitted, convicted or
whether they admitted the crime). A statute is presumptively inconsistent with the
First Amendment if it imposes a financial burden on speakers because of the
content of their speech. Therefore, even the compelling state interests could not save
the statute.
- States need to be more narrowly tailored to meet state interests. Cant single out speech
on a particular subject unless narrowly tailored to advance the legitimate compelling
objectives of the state.

There is money in crime!

- Jurors, lawyers, witnesses all have sold their stories for money
- Laws now limit their rights in sale:
a. Witnesses cannot sell their story until after testifying
b. Jurors cannot sell until 90 days after trial is complete
c. Lawyers must write without violating attorney-client privilege: write about
trial strategy, etc. but cant disclose privileged facts
D. CELEBRITY PUBLICITY AS A MARKETING VEHICLE p198

Johnny Carson v. Heres Johnny Portable Toilets, 6th Cir. (1983) p199:
Portable toilet used Heres Johnny saying and the by-line The Worlds Foremost
Commodian. Carson filed suit under federal trademark and state publicity law.
- ROP turns on identifiability of celebrity, not limited to name or likeness.
- Carson doesnt own the TM for the slogan, but he is associated/identified with it
b/c of national TV exposure.
- Identifiability only requires that the use clearly identifies the wronged person
(e.g., slogan, nickname, etc.)
- There is no likelihood of confusion, so no TM claim.
- D admits he thought of the name and slogan as a play on Carsons popularity. People
may think that Carson is associated with/endorses the product, therefore,
intentional misappropriation of celebritys identity for commercial exploitation.
- Court rejected Ds parody claim.
Dissent: says the majority goes too far in expanding ROP beyond name, image, and
likeness. Especially the case here where Carson is the beneficiary of someone
elses work that hes become associated with (i.e., Carson didnt even come up
with Heres Johnny but he now controls it).

Vanna White v. Samsung, 9th Cir. (1992) p210:

Robot that resembled Vannas likeness was used for SONY ad, after they sought her
permission and she rejected. D claimed parody.
- Court rejected parody defense: this was purely an advertisement for profit, no
fun or social/satire message involved. Advertisers used celebrity images
primarily for profit; the parody is only secondary.
Dissent: similar argument as Heres Johnny ROP has been extended too far.

Parody/Satire, Fair Use

- Political cartoons, editorials, SNL, MadTV, etc. may be for profit, but the parody
or satirical message is the significant reason for using the celebritys persona.

E. WHO OWNS PUBLICITY AND ITS VALUE p222

- see Norm & Cliff (Cheers) above
- see MLK Center v. American Heritage above
IV ELEMENTS OF COPYRIGHT PROTECTION p234

Source of Copyright Protection:

- U.S. Const., Art I, 8, cl. 8
- 17 U.S.C. 101-803, 1001-1010

Copyright is very date and fact sensitive.

Usually required to deposit a copy of copyrighted material with Copyright Office

Copyright: protects original works of authorship fixed in a tangible medium of

expression for more than a transitory period of time
106 - Bundle of Rights (17 U.S.C. 106):
1. Reproduction
2. Derivative Works
3. Distribution
4. Public Performance (for sound recordings, owner)
5. Public Display
6. Digital Transmission of (P) sound recording
107-120 Fair Use Defenses
- All of the above Bundle of Rights are subject to defenses in these sections

1909 Act:
- Formalities are necessary for federal copyright protection:
1. Registration; and/or
2. Publication with Notice
- Without either of these, may still qualify for state protection.
- Perfect Notice:
COPYRIGHT 2002
Authors Name (or clear identifier)
All Rights Reserved
- Duration: 28 + 28 (renew*) + 19** + 19** + 20 = 95 years maximum protection
(*renewal became automatic after 1964)

1976 Act (effective 01/01/1978):

- Vests automatically upon fixation
- Duration:
a. Individual: Life + 50** + 20*** years
b. Corp./Anon./WMFH: 75** + 20*** from publication; or }___
100** + 20*** from creation } |-->First to
arrive

Key: ** - subject to termination/recapture by author at the end of this period (cannot be

waived)
*** - 20-year extension due to Sonny Bono Act (effective date 10/27/1998)

Berne Convention (effective 03/01/1989):

- Formalities of Notice are no longer required (but still should be used because protection
against innocent infringer defense)
A. COPYRIGHTABLE WORKS p238

1. Originality p240:

Miller v. Universal, 5th Cir. (1981) p240:

Reporter wrote book about real-life kidnapping. Movie producer sought to buy the rights,
but author refused (author withheld the derivative rights). Studio made movie anyway, and
screenwriter admitted used much of the book as a source.
- Research is not copyrightable, nor are the underlying facts. Compilation of facts
may be copyright protected if contains original expression (SAC selection,
arrangement, coordination).

2. Fixation p247:

Horgan v. MacMilllan, 2d Cir. (1986) p247:

Book made based on the Nutcracker ballet contained still photos of the production. Issue is
whether the still photos were violative of the choreographers copyright (derivative work).
- Choreographic movements are copyrightable, if they are somehow recorded or
fixed.
- Elements of the choreography were taken, but were photos enough to violate copyright?
The derivative work must be substantially similar in order to violate copyright:
the test is not whether one can re-produce the choreography based on the allegedly
infringing copy. Even a small amount that is qualitatively significant may be
sufficient for infringement.
- Photos can potentially communicate a great deal more than the still image; an
experienced choreographer may be able to anticipate previous/subsequent movements
from the photos. This case was remanded for this question of whether there is
substantial similarity, and whether any fair use defense has merit.
B. INFRINGEMENT

Copyright Infringement:
1. Copyright ownership of the right infringed (right within bundle of rights)
2. Substantial Similarity
3. Access
4. Unlawful copying or use of copyrightable expression

- Substantial similarity and access are related, but distinct. Access is required to protect
coincidental, independent, un-copied similarities between works. Access may be
inferred from striking similarity, but D has opportunity to rebut that
presumption.

- Registration of copyright is required to sue in federal court. Registration can be

done simultaneously with the filing of the lawsuit.
Exceptions: a) Berne Convention authors where first publication was in Berne
country
b) VARA visual arts moral rights; limited # of works, etc. (see
106A).
- Register with U.S. Copyright Office (division of Library of Congress). Usually
required to deposit two copies of work with registration (see H#1)

- Forms for registration (H#1, p33):

PA - performing arts (musical and dramatic works . . . )
SE - serials, works issued or intended to be issued in successive parts
SR - sound recordings
TX - nondramatic literary works
VA - visual arts (pictorial, graphic, and sculptural, including architectural)

RE - renewal (for works under 1909 Act)

CA - to correct or amplify information on an earlier registration
GR/CP adjunct application for registration as a group of contributions (filed in
addition to one the above forms: PA, TX, VA)

- SOL for filing infringement action (from time of infringement):

a. Civil: 3 years
b. Criminal: 5 years

- AFC Abstraction, Filtration, Comparison:

1. Abstraction:
2. Filtration:
3. Comparison:
- D wants this approach b/c it removes general plot themes, scenes a faire, etc.
from the comparison.
- Judge usually makes initial determination as to what is protected (i.e., whether
AFC applies, and to what extent). Jury then determines if substantially
similar

- DEALPOINTS - Lawyers Opinion Letter:

- To the best of my knowledge language should be used, no matter how much
research/diligence used you can never be absolutely sure that wont infringe.
- Even if did research of popular/registered/published works, client may have
copied (intentionally/subconsciously) an unknown work or could be
substantially similar to judge/jury even if you dont believe so.
1. Access: The Music Scene

Bright Tunes v. Harrisongs, SDNY (1976) p256:

Hes So Fine (Chiffons 1962) vs. My Sweet Lord (George Harrison 1970).
Both songs were popular. Hes so Fine was #1 in U.S. and #12 in the U.K.
(Harrisons home).
- Infringement Test:
1. Chiffons distributor, Bright Tunes, owned and registered all rights under
copyright.
2. The melodies and harmonies were substantially similar, although the
words were different. Even the pauses, etc. were similar.
3. Access yes, very often on the radio.
4. Copyrightable expression: musicologist testified that they was very similar
use of a unique combination of chords, thus protectable/copyrightable
expression was used. I.e., substantially similar use of original work of
authorship.
- Note: intent is irrelevant to copyright infringement: court found that D
subconsciously copied, and there was no intentional copying but this is
still unlawful. Because of potential for subconscious copying, most
producers/studios have insurance policies to protect themselves. Note that
insurance may cover subconscious copying, but will not cover willful
infringement.

Selle v. Gibb, 7th Cir. (1984) p260:

Let It End (Ronald Selle - 1975) vs. How Deep is Your Love (Bee Gees 1978)
P was a little-known artist who did not get any airplay on the radio, he played in some
clubs, and he sent out a few demo tapes, but most were rejected without even opening.
- Striking similarity may infer access, but it is rebuttable. Claim of access must
be backed up somehow:
a. Played on public radio
b. Song was available to, or shopped to, someone who had a relationship to D
(e.g., promoter, producer, manager).
c. P & D played similar venues (or in similar areas), where D may have heard
the song.
- If strikingly similar, original burden of no access is usually on D; but once
credible evidence of no access is shown, then burden shifts to P to prove
access.
- Here, D introduced evidence of creation process, which tended to show
independent creation. P had no evidence of any potential access (no tapes
shopped to anyone associated with D and never played in a venue where
likely that he was heard by D).
- Also, as to copyrightable expression:
- Chords in both the songs were very common chords and chord
progressions. Evidence showed that much of the songs were probably
from common public-access sources and would not have been
copyrightable.

Other cases:
- k.d. lang (Constant Craving) won infringement suit against Rolling Stones (??)
- Isley Bros. (??) won infringement claim against Michael Bolton (Love is a
Wonderful Thing)
- Owners of Credence Clearwater Revival copyrights (Run through the Jungle)
won infringement suit against CCR lead singer and Run through the Jungle
writer, John Fogerty (Old Man is Down the Road).
2. Substantial Similarity: Books, Plays, Movies p267

Denker v. Uhry & Warner Bros., SDNY (1992) p269:

Mrs. Horowitz and Mrs. Washington (novel/play 1980) vs. Driving Miss Daisy
Crazy (play/movie 1987). P, a respected and prolific author, sued for Ds violating
Ps right to derivative works.
- Scenes a faire doctrine:scenes that necessarily result from the choice of a
setting or situation are not protected by copyright.
(fair scenes).
Even general similarities are handled differently:
a. Racism character (overtly racist Jewish man; no overt racism, but
surrounding atmosphere of deep south racism affects Southern woman)
b. Infirmity drew a black character into the story as in order to help racist
character (stroke - therapist; old age driver/chaffeur)
- Court found that anything that may have been taken was either un-copyrightable
expression, or scenes a faire no infringement.
- Protected by Copyright:
a. Themes
- Horowitz: recent racism in NYC (spans one month in 1977); Daisy:
deep-south racism from post-WWII to present (spans 25 years of
developing relationship, 1948-73)
- Full recovery of man with help of therapist versus Growing old
together as both characters deteriorate with age.
b. Total Concept and Feel
- Horowitz is principally a comedy; Daisy is principally a drama (although
the two plays have elements of both)
c. Plot: minus scenes a faire
d. Characters
- The more developed, the stronger the character and the stronger the
copyright protection.
- Here, they both had well-developed characters, but they were developed
differently and only had had surficial similarities.

Beal v. Paramount/Murphy/Buchwald, N.D. Ga. (1992) p278:

Arab Heart (drama; prince sent to America for education and finds Am. wife, but
have cultural problems when she goes back to his country) vs. Coming to America
(comedy; prince decides to go to Am. to find his wife b/c doesnt want pre-arranged
marriage).
- Different theme, different plot, different concept, different characters: Only scenes
a faire were taken.

DEALPOINTS - Lawyers Opinion Letter:

- To the best of my knowledge language should be used, no matter how much
research/diligence used you can never be absolutely sure that wont infringe.
- Even if did research of popular/registred/published works, client may have copied
(intentionally/subconsciously) an unknown work or could be substantially similar
to judge/jury even if you dont believe so.
C. UNPROTECTABLE STORY PARTS p285
D. FAIR AND UNFAIR USES OF ENTERTAINMENT WORKS p297

107 Fair Use

- Raise fair use defense: affirmatively acknowledge use, but argue that are allowed to do
it.
- Requirements/Factors:
A. Must use in one of the following categories (in same area or ballpark): news
reporting, scholarship, comment, criticism, teaching, research
B. (see p298 for full test):
1. Purpose and Character (nonprofit vs. profit)
2. Nature of Work (fact vs. fiction)
3. Amount Used (qualitative and quantitative)
- Qualitative: did it take the heart of the work
- Quantitative: how much of Ds work was comprised of work taken from P
and how much (what percentage) did D take from original work
4. Effect on Market Value of Ps Work** (does it replace the need for Ps?)
- **Usually, the most important to the courts
- Transformative interpretation does not replace the need for the
original: interpretation of work opens a new market for it, does not
compete with originals market.
- No distinction between published and unpublished work (thus unauthorized
commercial use of a portion of anothers copyright can qualify as fair use even if
what is taken is from an unpublished work).

1. Scenes a faire
- Incidents, characters, or setting which as a practical matter are indispensable,
or at least standard, in the treatment of a given topic. p285
- Supreme Court found that there are only 36 fundamental dramatic situations,
various forms of which form the basis of all human drama. p287
2. Characters

Warner Bros. v. ABC, 2d Cir. (1981) p290:

Superman v. Greatest American Hero
- Most similarities are generic to superheroes, and not specific to Superman: tights, cape,
double-identity, can fly, x-ray vision or special powers. It is OK that GAH was
influenced by Superman, as long as dont take too much. GAH can be seen as a
parody: knew of other work, and poked fun at it using scenes a faire. The numerous
differences between the characters tended to undercut substantial similarity; the
total concept and feel of the two works greatly differed. Superman was in control:
protector of truth, justice . . . and took his commitment seriously (drama); GAH
stumbled into the role of superhero and was a bumbling character (comedy).
- The more developed a character, the more copyright protection character cant
be a mere chess piece to the story. Note that Wonderwoman was found to infringe on
Superman.
- SAC (selection, arrangement, and coordination) are protected even if elements
used are generic.
- 107 fair use protects parody/satire and parody/satires are favored by the court;
above analysis shows that GAH also meets the other four factors for fair use.
D. Fair Use

Campbell v. Acuff-Rose, U.S. (1994) p303:

Pretty Woman case: Roy Orbison v. 2 Live Crew
2 Live Crew did a rap distortion of Roys folk ballad. They requested permission from the
owner of Roys copyrights but it was rejected. Crew claimed a parody/satire of the fantasy
of romantic love and changed lyrics to story of prostitution.
- Once a song is released publicly, anyone can do a cover version, as long as:
1. Cover is true to the original (otherwise may be infringing derivative work)
- Can defend derivative work under fair use doctrine
2. Follow statutory regulations and pay compulsory licensing fees (105)
a. Notify copyright owner of intent to cover
b. Pay statutory licensing fees (or negotiate fees)
- Note that there are different fees for: i) recording/releasing a cover and
ii) public performance of a cover.
- General Rule for Parody/Satire (falls under fair use as comment/criticism). One
can only take that amount necessary to:
1. Conjure up the original
2. Allow the message to be conveyed to society
- I.e., cant take too much: no more than is necessary
- Court found that the distinctive bass line and the opening lyrics were substantially
similar to Roys, but that the lyrics departed from original (and lyrics are a very
dominant part of the song). But, Court found that Crews version was a
transformative interpretation that probably opened a new market for the song
rather than affecting the original market. This is usually the most important factor
(to infringement and potential damages) - however, still remanded to determine if Crew
took too much.
- Negotiations with copyright owner is not an admission of infringement. One
should be able to negotiate w/o admission however, some court may use this as
evidence of infringement.
- Commercial use is not ipso facto unfair use: can make a profit and still claim fair
use.

Garbage Pail Kids

- Were found to infringe upon Cabbage Patch Kids, especially b/c they were directly in
the same market: cards, stickers, etc. Thus the replaced the need for original (#4, most
important factor). Adverse affect on market is probably not enough to meet
infringement standard; must show that product:
a. Somehow replaced the need for original; or
b. Had a significant adverse effect on market b/c of unauthorized derivative
(dilutes market for original).
- Court can look at actual effect and potential (prospective) effect.

Effect on Market Nation case:

Nation magazine scooped story from Newsweek, by taking excerpts from as-yet
unpublished memoirs of former President Ford. Newsweek had purchased first serial rights
to the memoirs.
- As a result of Nations publishing of the excerpts, there was no remaining value to the
purchased first serial rights (the excerpts were already out there) thus the market was
destroyed. Nation took only ~300 words but took the heart of the memoirs
discussions on Watergate. Unpublished works can be protected.
Raunchy Parodies (p315):
Bette Midler won a suit against song Cunnilingus Champion of Company C as infringing
on her song Boogie Woogie Bugle Boy of Company B.
V. ENTERTAINMENT INNOVATIONS AND INTELLECTUAL PROPERTY RIGHTS
p318

Time Spacing: may or may not be a violation

- Fair use if solely for personal use (original and copy)
- Copy from one media to another (e.g., LPs to tapes; MP3s to CDs)

Time Shifting: Fair Use

1. Free TV;
2. Watch for personal use only; and
3. Erase or tape over once watched

Public Performance Royalties (Music):

a. ASCAP
b. BMI (Broadcast Music, Inc.)
c. SESAC
- Represent songwriters, not recording artists. Administer licenses for public
performance.
- Databases are public, so can search to see where artist is registered.

Fairness in Music Licensing Products Act - 110, (free broadcast only):

a. Store over 2,000 sq. ft.
b. Bar/Restaurant over 3,750 sq. ft.
- Up to 6 total speakers (no more than 4 in one room)
- 4 video devices (TV) maximum 55 diagonal screen (no more than one per
room)

Audio Home Recording Act (1992)

- 2/3 royalty artist, (P) owner
- 1/3 royalty songwriter, owner

115 - Mechanical Royalties (greater of the following, round up to whole minutes):

1998-2000 7.10 per song or 1.35 per min.
2000-2002 7.55 per song or 1.45 per min.
2002-2004 8.00 per song or 1.55 per min.
2004-2006 8.50 per song or 1.65 per min.
2006-2008 9.10 per song or 1.75 per min.
- Different from public performance royalties paid through BMI, ASCAP, SESAC
- Songwriter gets above mechanical royalties are for each unit distributed (sold,
promotional, given away). Calculated per song (each song is a unit).
- If one songwriter wrote all the songs on a CD, he gets the royalties in the amount
of (# songs/CD * # of CDs distributed).
- DEALPOINTS - Royalties are usually negotiated down to of fixed statutory rate
(not per minute rate), and sometimes will limit payment to 10 songs per CD (only get
paid for 10 songs, even if > 10 on the CD).
- Excess mechanicals: label must pay full rate by statute, but will recover the
difference (full ) from recording artists who use other songwriters songs.
- Recording artists do not get mechanical royalties. Recording artists get paid less, plus
the studio holds collateral against their earnings for production costs, advertising, etc.
Recording artist, therefore, makes nothing until get past break even in advances.
A. Fair Use and Home Video

SONY v. Universal, U.S. (1984) p327:

Universal sued SONY as contributory infringer for manufacture of VTR, which allows
people to tape TV shows (and FF thru commercials which makes advertisers unhappy).
- Why not sue public?
a. Bad policy to sue consumer
b. Too many people to join in suit (impractical)
- Home Video Taping Fair Use Time Shifting:
1. Free TV;
2. Watch for personal use only (non-commercial, private use in own home); and
3. Erase or tape over once watched (do not create a library of tapes)
- Basically time-shifting is allowed b/c you are only capturing what you would have
watched if you were available.

If Court came to different conclusion in SONY, it might stifle innovation.

- Courts will uphold an innovative device against potential contributory
infringement if device has some substantial, non-infringing use(s).

SONY case does not extend to home audio recording, but Congress passed Home Audio
Recording Act in 1992, which does allow audio taping for ones own personal use.
- Distributing audio tapes to friends is infringement (as it is for video tapes).

NAPSTER
- Not a fair use b/c no showing of substantial non-infringing use.
- Theoretically, could share unsigned artists songs (this was Napsters claim for
founding), but Court found that the site operated almost exclusively infringing activity.
- On TV/radio, advertisements generate money, at least some of which gets to the artist
thru royalties. Napster generates no revenue for the artists.
B. PERFORMANCE RIGHTS IN SONGS

Broadcast Music, Inc. (BMI) v. Claires Boutiques, Inc., 7th Cir. (1991) p341:
Retail store chain (~750 throughout U.S.) has revenues of $170M and net income of $13M.
Stores play local radio station broadcasts. BMI sued for copyright infringement. Stores
were using small, two-speaker Radio Shack home stereo receivers. BMI pressed for the use
in the aggregate (750 stores x 2 speakers/store = 1500 speakers), while Claires argued for
treating each store individually.
- Songwriter should get paid for every public performance of a song. BMI, ASCAP,
SESAC try to administer, pro-rate fees based on total popularity/exposure of songs
written by each artist.
- Anyone that uses radio in commercial establishment should have a public
performance license. Licensing fee depends on:
a. Size of establishment
b. Size of audio/video system
c. Whether live broadcast or recorded music
- In practice, need to get a license from all three above, unless you somehow limit
the music played to artist covered by one.
- There are many violations (ASCAP is said to be the 2nd largest user of the federal
courts (behind only the federal government itself).
- Single Receiver, Small Business Exception (no license needed):
1. Live broadcast (free radio)
2. Receiver must be typical of one used in a persons home
- Congress expanded this exception (see above)
- Court held that each individual store in a chain should be treated individually, not
in the aggregate. As long as each store complies with single receiver exception, no
infringement.

Family Exception: no public performance license needed to play a song or sing-along

among circle of close-knit friends and family

Point of Sale Exception (no license needed):

- Recordings: dont need public performance license if you sell the music that is played

Johnny Carson theme song: in its worst year, it generated $750K for songwriter (Paul
Anka). It averages ~$1M/year. Yesterday by the Beatles is the #1 covered song, with
Louie, Louie by the Kingsmen a close 2nd.
C. DIGITAL SAMPLING AND IMAGING

Jarvis v. A&M Records, D.N.J. (1993) p355:

Digital sampling case: fragmented literal similarity.
- The value of a work may be substantially diminished even when only a part of it is
copied, if that part copied is of great qualitative importance to the work as a whole.
p357
Fragmented Literal Similarity (i.e., digital sampling) p357
- Question: did D appropriate either qualitatively or quantitatively constituent
elements of the work that are original to P?
- To be answered by the ordinary lay person, with testimony by experts on each
side
- The practice today is to license: mutual benefit (old artist gets new exposure; new artist
gets to use sampled material).
- Compulsive licensing only applies if use is true to the original. But, sometimes will
negotiate to pay statutory fees based on the whole song, even if only sampling.
- Sampling infringes on and (P). A master use license is used to get rights to
both and (P).
- If sampling for a video, movie, choreography, etc., must get synchronization license
(synch license).
 D. COPYRIGHT OWNERSHIP
- In order to show infringement, first must show that one is the owner of the right
under copyright for the right that is allegedly infringed (factor #1 in infringement
test).
- Bundle of Rights are separable and each of the rights can be licensed or
retained individually.

Authors can transfer any/all of their rights by license, but retain non-waiveable
right to recapture/terminate licenses after 35 years.

Ownership v. Authorship
- The author is also the owner of the copyright, unless licensed out.
- The author is generally the person(s) who created the original work, but there are
the following exceptions/considerations:
a. Work made for hire (WMFH) see 17 U.S.C. 101 & 201
- Author is the employer or commissioning party, if statutory
requirements are met (including a written agreement if
commissioned work).
b. Joint Authorship see 101:
1. Intent to be joint authors
2. Each contributes copyrightable expression (majority view:
Goldstein); or
Final work is copyrightable, not necessarily each element (minority
view: Nimmer)
- Circuits are split as to whether majority/minority view
1. Work Made for Hire (see H#1, p37-40)

CCNV v. Reid, U.S. (1989) p363:

Nativity scene: sculptor made statutes of homeless people; CCNV made underlying
base consisting of a steam grate. Dispute over who controls the work (who is author?).
WMFH:
a. 101(1). Employer is the author if made by an employee within the scope of
his employment.
b. 101(2). Independent contractor is the author of a work, unless it meets
criteria for WMFH:
1. Specially commissioned work.
2. Written agreement, signed by both parties, that it is a WMFH.
3. Fits one of the statutorily defined categories (generally, does not include
stand-alone works).
- Parties here did not meet 101(2) requirements, thus issue narrowed down to
whether sculptor was an employee (and CCNV was author) or an independent
contractor (and sculptor was author).
- Whether one is an employee within the scope of employment should be
determined by the general common law of agency. The sculptor here was seen
as an independent contractor. (See p367 in text and H#1, p39-40 for 11 factors
used to make determination).
- Court also rejected claim of joint authorship: not the intent of sculptor to be
joint author (and CCNV may not have contributed copyrightable expression
majority view test). CCNVs platform was a common shape and probably not
copyrightable, but did include steam grate and pedestal.

2. Joint Authorship

Childress v. Taylor, 2nd Cir. (1991) p370:

Play based on a black comedienne, Moms Mabley. Idea was by an actress, who also
did much of the research and made suggestions to the script. Actress hired a writer to
write the actual play.
- Intent to be joint authors must be shown by the evidence (a written agreement
is not necessary:
a. How did the relationship develop
- However, joint authorship or collaboration agreements are very
important/influential (dispositive?)
b. What was the goal/purpose/intent of the relationship
- Testimony of the majority contributor is usually weighed most
heavily
E. COPYRIGHT LICENSING

Effects Assoc. v. Cohen, 9th Cir. (1990) p377:

Special effects done by independent contractor for D; through a letter and an oral agreement.
Uncontested that P was the author and owner of the copyrighted footage: not WMFH
because no written agreement signed by both parties and independent contractor so not an
employee based on agency law. (Note that special effects would have fit one of the nine
categories for WMFH b/c it was a contribution to an audio-visual work). D used effects in
his film but since he wasnt happy with the quality of the effects, so didnt pay full agreed to
price.
- D had a non-exclusive license ( 204) through oral agreement (exclusive licenses
must be in writing). Thus, no infringement by using the footage. Note that P may
still be able to recover the full price through a contract claim (in state court).
- Absent an express transfer of ownership, a contributor who is not a WMFH
retains ownership of his copyright.
- DEALPOINTS - P should have:
1. Conditioned any use of the footage upon receipt of full payment
2. All rights not expressly granted are expressly reserved to the author (never
give up more than you have to when you grant a license).

Cohen v. Paramount, 9th Cir. (1988) p383:

P granted synchronization license to D in 1969:
- License to record in any manner, for, or language except:
a. motion pictures
b. by means of television
- Court found that by means of television did not include copying onto
videocassettes for distribution to the public:
a. No express language authorizing the distribution of copies to the public by
sale or rental
b. VCR/VTR technology was not contemplated/anticipated at the time of the
contract.
- Courts will often construe a K against the drafter, but will also look at the intent of the
parties. Ps had added the language that P reserved all rights . . . except those
herein granted.

See pgs. 388-89 for Supreme Court and Circuit rulings on contract language and
interpretations.
 F. ENFORCING COPYRIGHT

Remedies, 17 U.S.C. ____

502 Injunction
503 Impoundment
504 Damages
(b) Ps loss, Ds profit (subject to apportionment) but no double-counting;
or
(c) Statutory damages (if qualify)
- Must have registered within 90 days of publication, or prior to
infringing activity
505 Attorneys Fees
506 Criminal Penalties (see also 18 U.S.C. 2319)
507-13 Misc.

Statutory Penalties:
- Pre-1989: minimum $200; ordinarily $250 - $10,000; willful >$50,000
- 03/01/89-12/02/99: minimum $200; ordinarily $500 - $20,000; willful >$100,000
- post-12/02/99: minimum $200; ordinarily $750 - $30,000; willful >$150,000
- minimum may be given for innocent infringer
- No innocent infringer defense if registered

1. Damages

Gaste v. Albert, 2d Cir. (1988) p395:

The song Feelings copied music written by a French composer. Feelings infringed on
the music, but had its own lyrics.
Damages:
- 88% of Ds profits (100% minus 12% apportionment for lyrical contribution).
- Producer was allowed to apportion an additional 8% for the expense of making
the infringing song.
- Apportionment is usually allowed for expenses in creating a work as long as
can show good bookkeeping (burden on infringer to show/prove expense)
- Overhead can only be claimed as to infringing work itself, not overall
company overhead
- Infringing artist may be able to apportion based on the newly added material (here it
was found that lyrics were worth 12% of profits). Courts will allow parties to try to
attribute portion of the revenues that attaches to the copyright material taken
should only have to pay damages for the value of that which was taken.

2. Attorneys Fees

Fogerty v. Fanatasy, Inc., U.S. (1994) p399:

- 505 Attorneys fees is an even-handed provision, should be applied equally to
prevailing Ps and Ds.
- Prevailing doesnt necessarily mean winning party. De minimis infringers
have been awarded attorneys fees.
e.g., Mom & Pop infringing D was awarded attorneys fees even though found to
infringe on big studios copyright: P got the minimum statutory damages, but D got
attorneys fees (or a portion thereof).
VI. ALTERNATE SOURCES OF ENTERTAINMENT PROPERTY RIGHTS p404

vs. TM/SM/

Lanham Act 43(a) protects unregistered marks

- 15 U.S.C. 1125
- Lanham Act is also called the Trademark Act
- Protects against passing off:
a. False advertising
b. False designation of source/origin
c. False affiliation
- Entertainers names are unregistered service marks (in most cases). Thus, fall under
43(a).

Visual Artists Rights Act (VARA) 17 U.S.C. 106A

- Protects works of visual art, defined as: a) less than 200 copies; b) signed and/or
numbered. Does not protect WMFH, work for advertisements, etc.
- This was an attempt to satisfy Berne Convention requirements for moral rights (droit
moral).
- Protects:
1. Integrity/honor of the work
2. Authors right of attribution (or not to attribute)
- These rights cannot be assigned, but they can be waived (be careful not to give
them away by K).
- Congress says Berne Convention requirements for moral rights are mostly covered by
the combination of (although not as strict as most Berne countries, U.S. satisfies to the
extent necessary):
a. VARA
b. Lanham Act 43(a) and common law doctrine.

Droit de suite
- Not protected in the U.S., but in some foreign countries (e.g., France)
- This is the right to royalties for future sales of a visual work of art.

Unions/Guilds
- These self-regulating organizations may set industry practice and define some minimum
requirements/standards.
WGA - Writers Guild of America (East and West Coast)
DGA - Directors Guild of America
SAG - Screen Actors Guild
AFTRA - American Federation of TV and Radio Artists
AFM - American Federation of Musicians
BS&P - Broadcast Standards & Practice
- Responsible for securing entertainers reputation, integrity, credit. E.g., directors cut
A. ARTISTIC CREDIT

Lamothe v. Atlantic, 9th Cir. (1988) p410:

Three members of a band co-authored two songs that were later recorded by one of the
members in a new band (RATT). That one member made some changes and did not give
the other two any credit for the writing.
- Copyright doesnt cover defects in notice: only one author is necessary for
copyright.
- Absent an agreement otherwise, co-authors have equal rights to exploit but are
obligated to share compensation earned through the property.
- Cause of action here was:
43(a) false designation: omission of some authors in the publication (reverse
passing off).
- Omission may be seen as the equivalent as misleading.
- The artist and/or the producer may be held liable for knowingly committing a
false designation.
- This case was remanded for trial under above rules (previously action was dismissed for
not stating a cause of action).

B. MORAL RIGHTS AND CREATIVE CONTROL p418:

Granz v. Harris, 2d Cir. (1952) p422:

Jazz artist allowed the live recording of his playing on the condition that it was credited as
Presented by Norman Granz and was released on a 12-inch 78 RPM record. Licensee
correctly credited the production, but produced a 10-inch record and omitted eight minutes
of music and audience cheers.
- Artist had breach of contract claim for false representation of the use presented
by.
- Artist, unless he waived his rights, was entitled to get an injunction against the
distribution of the 10-inch recording.
- Licensee may still have been able to release the music if he purchased those rights
separately or expressly, but cannot use the designation presented by artist
without the artists permission.

Preminger v. Columbia, NY Sup. Ct. (1966) p425:

Director licensed Columbia the right to show Anatomy of a Murder on television.
Contract stated that a) director had right of final cut and editing, but b) studio had exclusive
and irrevocable right to show on TV.
- Court said the only reasonable interpretation of this K was that director gets final
movie cut, but studio has the right to make necessary edits for TV based on
common industry practice. Minor cuts are OK, but not allowed to distort or
mutilate the work:
- Timing and limited editing for commercials, censor for TV audience, etc. are OK.
- Significant cuts are not allowed.
- Director claimed that the 161-minute directors cut was edited down to ~53-100
minutes. Such extensive cuts would be mutilation. Court said not enough evidence
shows such an extensive edit: remanded for trial to determine the actual extent of the
editing.
Gilliam v. ABC, 2d Cir. (1976) p430:
Monty Python comedy troupe licensed the BBC to broadcast The Flying Circus. P had
contract provisions which mandated that they keep creative control over all content, spelling
out the procedure if there was any alteration requested/required by BBC. BBC then licensed
to Time/Life, who in turn licensed to ABC.
- One cannot license away more rights than one has in contract.
- P specifically bargained for creative control, thus it was maintained. Commercials
are not the industry practice in England, thus P need not anticipate that when
licensing its rights. Also, the cuts made by ABC were extension (30 minutes shows
were cut to ~22). Thus, the editing constituted a violation of the artists rights.

BS&P (Broadcast Standards and Practice): includes FCC regulations and other
industry
practice.

DGA Typical Standard:

a. Director gets first cut.
b. Producer gets final cut, but director is allowed to be present and consult.
c. If director doesnt like producers cut, he can:
i. Request for re-edit
ii. Demand that his name be removed
- Directors with more clout can bargain for final cut.

43(a) is not available for consumers to file actions as plaintiffs. Studios, presenters, and
other parties involved are seen as enough potential plaintiffs that consumer interest is
protected.
- However, consumers are always supposed to be warned when something is changed
from the original.
E.g., Movie that has been modified from the original in order to fit format for TV.
 C. TRADEMARK INSTEAD OF COPYRIGHT

Trademarks
- Includes service marks, fed. certification and collective marks, and fed/state/cl
tradedress
- If federally registered, : 15 U.S.C. 1051-1128. Must be in interstate or
U.S./foreign commerce to be eligible for federal registration.
- Otherwise: TM, SM protection under state and common law

Touchstone of Trademark Law:

- 43(a) likelihood of confusion (LOC)
- 43(c) likelihood of dilution (LOD)

Polaroid Test for LOC:

1. Strength of Marks
- Strength of original owners mark can define extent/breadth of protection.
E.g., McDonalds exclusively owns most Mc- names, even outside food
business (defeated McSleep motel chain).
2. Degree of similarity
3. Proximity of products/services
4. Ps likelihood to BTG (bridge the gap)
5. Actual confusion
6. Quality of Ds products/service (whether may tarnish Ps reputation)
7. Sophistication of buyer

Dilution (LOD):
a. blurring the source: too many users such that it is hard to identify the
original
b. tarnishment: inferior product gives bad name to original source quality
standard

Fair Use of TM/SM

1. Product/service in question must be one not readily identifiable w/o use of
mark;
2. Only so much of the mark may be used as is reasonably necessary to identify
product/service; and
3. Use must not suggest sponsorship or endorsement by P mark owner
Other Fair Use Exceptions:
A. Comparative advertising
B. Noncommercial use of the mark
C. All forms of news reporting and news commentary

C/D/T (color depletion theory): limited allowance of exclusive right to use color as a mark
b/c there are only a limited number of colors available for use.
- But may use color as a mark if
1. Not functional and has achieved secondary meaning
2. Signifies single source
3. Restricted to own area of commerce
e.g., Green M&Ms; Pink Corning insulation are trademarks
Green tractors (functional identifies the country, grass, etc.); Pink antacid
(functional soothing); Black outboard motors (functional matches the most
boats) are not trademarkable
 Sound may be a mark, if adopted for product/service
e.g., NBC chimes (notes are GEC for General Electric Corporation)

Certification mark: signifies meets some standard, owner of mark licenses use of the
mark (cannot use the mark on ones own products/services)
Collective mark: signifies membership/association

FITGTT first in time gets the territory

- Owner of mark only gets exclusivity in territory of constructive use (and may
include limited zone of expansion ZOE: geographically and in market)
- Senior vs. Junior marks
- State/federal registration may give entire state/country as territory, but senior users
may be able to continue usage in certain carved-out territory. E.g., Burger King
is federally registered, but could not prevent use by senior user in small area
original to senior user.

Two Federal Registers (can now apply for both on-line):

1. Principal: stronger set of rights, including protection against foreign
imports
2. Supplemental: can still use , but not all rights attach
- no constructive use across country
- After 5 years on supplemental, presumed to have secondary meaning and
can file to move to principal register

Hormel v. Jim Henson, 2d Cir. (1996) p449:

Hormel sought to prevent Henson from using a character named Spaam in Muppets
movie b/c felt it infringed on their SPAM trademark (and felt it was poking fun and may
tarnish reputation).
- Polaroid Test was used:
- SPAM and Muppets are both very strong
- Marks not that similar
- Different area of services, but both in merchandising (t-shirts, etc.)
- SPAM not likely to enter the entertainment field, but may clash in merchandising
- No actual confusion
- Muppets generally seen as quality entertainment
- May not be sophisticated, but children and adults will at least know enough not to
buy one when wanted the other
- Overall: obvious, though inoffensive, nature of the parody and prominence of
both the Muppets and Hormels SPAM make it improbable that there will be
LOD.
true to both the name and the likeness

Warner Bros. v. Gay Toys, Inc., 2d Cir. (1983) p458:

Dukes of Hazzard car, the General Lee trademark was owned by the WB. Sued toy
company that made a replica, including the confederate flag.
- WB could have potentially gotten copyright (3-D work of art) and trademark (source
signification), but unregistered.
- LOD is found under 43(a) Lanham Act b/c General Lee had developed
secondary meaning. Consumers would associate the replica with the TV show. Not
absolutely necessary that the consumer would be solely motivated to buy the product
due to original source designation only need to show that consumers may believe the
product is associated with original source.
 D. CONTRACTS RIGHTS IN STORY IDEAS

Misappropriation of Ideas
- Protection of ideas against a small group or an individual; not inconsistent with
copyright b/c not protecting/holding ideas against society.
1. Novel
2. Concrete Form
3. Used by D
4. Ps expectation of payment
- 68% of all suits against movie studios are misappropriation of ideas (studios call
them nuisance suits)

Theories of Recovery
- Express K (less novelty)
- Implied K (novelty)
- Quasi-K, Unjust Enrichment (highest degree of novelty must be shown)
- Breach of Confidentiality/Fiduciary Duty (maybe no need for novelty; claim is
based on bad faith)
- Conversion of Property (formerly used, not so much anymore)
- Services Rendered (Not recognized in NY, see Murray v. NBC)

Main Defense
- Didnt use Ps idea; the idea/story were independently created
- Test is similar to infringement: 1) access; 2) similarity

DEALPOINTS Idea Submission Tips:

A. Use hard and soft approach
- Hard: dont meet until an agreement is signed
- Soft:
1. Send letter from law firm, building up elements of confidentiality
and implied K.
2. Meet w/o written agreement, but remind of implied K and
confidentiality
3. After meeting, again remind of above by letter
B. Double envelope method
- Outside envelope stamped confidential. Inside is a sealed self-addressed
envelope and a cover letter stating that if dont agree to the terms of the letter,
then should send back the envelope w/o opening. If opened, signifies that
agree to terms.
C. WGA registration of script (east or west) best to do so with copyright notice on
it
-However, some are hesitant to date ideas: want them to sound fresh
(WGA doesnt require a date, just a registration #).
D. Know the studio will probably counter with their own submission agreement
Buchwald v. Paramount, Cal. App. Div. (1990) p478:
Coming to America. Buchwald registered script with WGA. Buchwald pitched the idea
to Paramount and suggested Eddie Murphy as the star for his script King for a Day.
Written agreement was reached but then abandoned. Paramount pitched an idea to Eddie
Murphy and developed Coming to America. WB studio picked up Buchwalds script, but
dropped once they heard of the Paramount movie with Murphy.
- Treatment: pitch to executives/producers, may or may not be copyrightable.
- Express written agreement betw/ studio and P for any movie based on Ps treatment.
- Based on = based upon a material element of, or was inspired by
1. Access (no issue here direct access)
2. Similarity (sufficiently similar, considering the access)
- Studio appropriated and used a qualitatively important part of Ps material in
such a way that features discernible Ds work are substantially similar.
- Court rejected the defense that the idea itself was not original/novel and thus was public
domain.

Murray v. NBC, 2d Cir. (1988) p488:

NBC financial analyst said he had an idea for a sitcom about a non-stereotypical black
family starring Bill Cosby. NBC told him to flesh out the idea and he did, even
writing/proposing some episodes. Cosby Show appeared about four years later, and P
sued. All elements were undisputed by the parties, except for novelty.
- Occupation of P probably significant: might have been a different case if he was a
professional writer.
- Novelty is from the view of the recipient.
- Choice of law provision meant that it would be litigated in NY (services rendered not
recognized). NY generally pro-studio; CA generally pro-artist.
- Novelty:
- Cosby had mentioned a similar idea in back in the 1960s. But only stereo-typical
black shows had been used by the networks up until Cosby.
- Court said the idea was not novel, it just took a while to be
accepted/developed on TV.
- P didnt sue for copyright: copyright is the better choice if possible. Can bring both
claims, but be careful not to miss one and lose opportunity due to the entire
controversy doctrine.
VIII. CONTRACT FORMATION AND DURATION

Entertainment Contracts (Clash of Commerce and Art)

Long-term employment v. Free Agency

- In past movie/TV did long term Ks, now only used in recording industry
- Authors usually give book publisher the right of first refusal for subsequent
books or may contract for a multi-book deal

Deal Memos
- 1-3 page laying out major terms of K
- Deal memos are generally not enforceable b/c dont contain enough detail: refers
to a log form K. Entertainer should never agree until inspects long-form K. Studio
will try yo make binding before review.
- Long form usually has details such as net-profit calculation, other terms and
conditions, outs for the studio if project looks to be unsuccessful, try to get
ROP from artist

Oral Contracts
- Promissory estoppel, detrimental reliance
- Restatement 90 of Contract
- S/O/F (Statute of Frauds)
- Can be performed within a year (promissory estoppel is an exception)
- NY Test for Oral Ks: p522

Personal Services
- CA Rule for negative injunction (cant work elsewhere while under K)
- No more than 7 years, guarantee $9K/year
- 7 years mainly b/c recording industry needs to have time to recoup advances
(need ~3 albums to break even)
- Cant force a person to perform personal services by positive injunction

Contract Formation Concerns

S/O/F
Definitiveness
- Construction/Interpretive Aids (see also p523-24):
a. Express language (4 corners Williston on Ks)
b. Partial performance and understanding
c. Past dealings (w/ eachother; w/ other parties)
d. Industry custom and practice
Consideration and Mutuality
Minors (age of minority is 18 in NY)
- Court Approval up to 7 years (NY)

Best Efforts (duty of good faith and fair dealing is built into every contract)

Loan out companies (seek individual guarantee)

 DEALPOINTS Tips

Artist Protection and Contractual Outs

- Key Person
- Performance Goals
- Floors/Ceilings (amount of money to be spend in promoting, salaries to be paid, etc.)
- Pay or Play provision
- Most Favored Nation provision
- Audit Clause: right to examine studios books, as it relates to your project w/ studio
- Riders: extra provisions, luxuries, etc. (sometimes made purposely difficult so that
artist can walk-out if doesnt want to perform. E.g., Van Halen: no brown M&Ms)

- Negotiate outs of contract, no matter which side youre on.

- Try to set up cure provisions so that other party cant void K for
mistakes/omissions
- Notice and opportunity for cure
- Set definite time frame for opportunity to cure

Termination of Contracts: Factors to consider

a. Extent to which non-breaching party is deprived of benefit reasonably expected as
per K
b. Can non-breaching party be adequately compensated through damage award
c. Degree of performance to date (promissory estoppel, services rendered)
d. Willfulness of breach (potential punitives?)
A. CONTRACT FORMALITY: THE MOVIE WORLD

Kim Basinger Boxing Helena Litigation - p505

Deal memo covered main points for Basinger to star, production began. Oral agreement was
made based on the deal memo terms. Basinger wanted to back out based on problems with
nudity. Court found for the studio: $8M damages, then settled for $3.8M. Basinger filed for
bankruptcy, but denied.
- Ed Harris had a pay or play provision and he was paid $600K when key people
dropped out.
- Under SAG agreements, nudity requirements must be signed after review by
actor/actress.

2. Statute of Frauds/Promissory Estoppel

Elvin Assoc. v. Franklin, SDNY (1990) p512

Discussion for Aretha Franklin to perform in a Broadway show. Franklin expressed interest,
but said she had developed a fear of flying and was nervous about getting to NY: would only
travel on the ground at 200 miles per day. They tried to negotiate a deal.
- No written agreement, but producer won based on promissory estoppel (p515)
1. Aretha told the studio that she was enthusiastic about the show and it would be
given the highest professional priority.
2. Aretha was aware of the preparations and expenses going on due to her
commitment, and she never disclaimed any of her promises to perform.
3. Her initial fear of flying was supposedly worked out, and Aretha gave the studio
reassurances that she would fly. Therefore, her promise was not conditional.
- It would be unconscionable for Aretha not to pay studio after it had relied on her
promise.

Notes (p516)
Later attempt to revive the show was also unsuccessful. Producer had a deal with Aretha,
but it was conditional on the ability to sell/book the performances. Many venues required
large deposits b/c of the earlier trouble with the production, so producer could afford it.
Because of conditional provision, Arethas suit against the producer was dismissed: Aretha
knew or should have known that the agreement was contingent on successful scheduling
no breach by studio.

Gold Seal Productions v. RKO, D. Cal. (1955) p517:

Producer owned the rights to a book, and had agreement with a studio to develop into a
movie. Studio wanted Gregory Peck, but handshake deal was made to make movie
w/ or w/o Peck (and that was affirmed more than once by studio), i.e., unconditioned
agreement. When Peck didnt sign on, studio backed out of deal. No other studio
picked up option, and P claimed it was b/c of the damage inflicted by Ds back-out (no
one wanted to be associated with a questionable production).
- Court found breach of oral/implied contract; based it reasoning for finding a
contract upon:
1. These two had contracted before
2. Basic terms were agreed on and worked out orally
3. The parties had agreed to make remaining terms the same as those of a
previous contract between them.
- Not necessary for each term to be worked out, oral K may be sufficient w/o
signing agreement.
- Deal agreement was for $125K, plus 20% profits. Producer won and was awarded
$375K, which was reduced by appellate court to $275K.
- Court wont usually speculate on profits, but here it did willfulness of
breach?
 B. DEFINITIVENESS

Pinnacle v. Harlequin, SDNY (1981) p524:

Book K to publish 7 books, then best efforts agreement to negotiate a new deal.
- Implied good faith and fair dealing in every contract (w/ or w/o best efforts
clause).
- No guidelines were given as to what best efforts entailed: too indefinite to
enforce.

Guidelines courts will look for:

a. Right of first refusal
b. Exclusive negotiations for a period of time
c. Opportunity to match best offer
d. Promise of first look
e. Mandatory disclosure of all pending offers
- Generally, definitive terms make contracts easier to interpret, but parties are unwilling
to give away too much or get locked in.

C. CONSIDERATION AND MUTUALITY

Bonner v. Westbound Records, Inc., App. Ct. Ill. (1979) p532:

Five year record deal with then-unknown Ohio Players. Band will make records
exclusively for studio. Studio will advance payments against royalties. No performance
provisions for the studio. Studio and band cut two albums, and one went gold. Band tried to
get out of deal and sign with a larger label. Band tried to claim contract was unconscionable
for no mutuality b/c band had performance provisions, but studio didnt (no requirement that
studio actually release any albums).
- Even w/o performance provisions, contract was upheld b/c studio actually did
perform services for the band. Studio generally supported the band with advances
against royalties (consideration), plus forwarded money that they were not
obligated to pay showed good faith (mutuality) on part of the studio and showed
that studio suffered legal detriment (promissory estoppel).
- Studio also did not try to keep the band at its mercy given much creative control
and band kept full control over the profits of their lives shows, which at the time was
their main source of income.
- Promissory estoppel: even if the contract may not have been enforceable at
formation, it became enforceable when studio performed (by giving advances) in
reliance on the Ohio Players returning the advances upon their receipt of royalties.
- If studio doesnt condition upon royalties, they face a lose/lose situation. If band
bombs, they are stuck with the bill. If they band succeeds, the band signs with a
new label, and the studio doesnt reap any profit from its investment.

D. MINORS

Scott Eden Management v. Kavovit, NY Sup. Ct. (1990) p541:

D was a child actor, worked mostly in soap operas. Parents tried to disavow/void contract
with personal manager b/c minor and not approved by court.
- A minor under unapproved contract may void the deal, but must pay manager for
services rendered. Purpose of court approval is so that minors are not taken advantage
of; not so they can escape any legal liability.
DEALPOINTS

Personal Representatives (see H#2)

- Personal Manager (10-25% commission)
- Agent (10-15%, 10% max in NY)
- Business Manager, accountant
- Attorney (2-5%)
- Publicist
----------------------------------------------
- Others, usually a flat fee

Personal Manager v. Agent

- Only agent can procure employment (must have an agency license).
- Managers cannot shop their clients (incidental exception in NY)
- Managers role is to give career counseling advice and guidance (NJ still requires and
employment license)
- Courts looked to function performed by personal representative, not the title he
uses

Managers, agents, attorneys usually base their compensation on gross earnings.

- In NY, booking agents cannot receive more than 10% of gross (by statute).

Personal Manager (H#2)

- Usually works for multiple clients
- Usually a standard K:
a. Exclusive representative of the artist
b. ~5 year duration, usually in 1 year or 18 month increments
c. Both sides try to work in contractual outs (some based on performance by above
increments)
- Scope of representation depends on qualifications of manager:
a. Territory: U.S., U.K., Major European, ROW (Rest of the World)
b. Media: music, movies, books, etc. (can have one manager or multiple)
- Compensation is typically 15-20% gross revenue
- Make sure gross is defined in K: gross beyond advance (artist), gross straight
off the top (manager). What is commissionable: (inc. gifts, lawsuits, tour support,
recording support, everything, etc.)
- Power of attorney provision: manager wants full control/approval power to sign deals
for the artist; artist should try to limit the power of attorney: keep authority over
decisions and money (cap amount of money without authorization)
- Performance goals and phase-out provisions: important.
- Manager: all agreements entered, substantially negotiated, plus all renewals and
extensions
Artist: phase out over a period of time depending on duration of K, generally never
more than 3 years
- Conflict of Interest
1. If same person is attorney and manager: make sure all agreements that involve
compensation to the attorney are reviewed by another lawyer. Jim Croce rule:
any time attorney gets a %, retainer agreement must be reviewed by another
lawyer.
2. If same person is agent and manager: specify what tasks are accorded to each role
b/c they get paid different percentages.
Agents:
- Compensation capped at 10% in NY (generally 10-15%), and generally doesnt apply to
literary agents or orchestral booking agent.
- Can generally be terminated at any time.

Business Manager (glorified accountant):

- Should be separate from personal manager; dont want personal manager to have
control over the money. Should be accountant or accounting firm.

Attorney:
- Can be fired at will.
- LOD (Letter of direction): directs studio to pay lawyer his fees directly (not through
manager or artist.

Record Industry Agreements

- Overcall: contract to do more albums in one period, at the option of the studio
- Where did all the money go? (H#2, p7)
- Certified sales are important: must make sure of # sales, not #shipped
- Never negotiate less than 10% royalty for artist (minimum 10%, should aim for
more)
- Advance to artist should be 10-15% of recording fund
- New technology deduction: was invented to cover losses in case CDs didnt take
in the market, but still around now after >15 years.
- Excess mechanicals: company charges the recording artist for excess mechanical
royalties to the songwriter:
a. excess over 10 songs per album
b. excess over royalty (if cant negotiate songwriter down to )
- Artist should try to negotiate that studio pays 100% royalties and raise limit to
~12 songs.
- Although the terms seem oppressive, courts have upheld the majority of record Ks
(exception: the Kingsmens K was found unconscionable)
- Greatest Hits: less production, only packaging and promotion (and can be big money-
makers, e.g., Beatle, Eagles)
- Artist should try to negotiate that GH goes towards commitment for # albums
(usually they dont). Dont let studio reduce royalties for GH (they will try).
 Creative Control (Right of Consultation and Approval)

Morals Clause: conduct that may tarnish reputation (see p578)

- Morals clause can work both ways: product and endorser; company/studio and
talent
- Both sides should obtain the contractual rights to get out if either side is immoral
(reciprocal rights)
- Tough deal point b/c most studios, producers, etc, dont want it to go both ways

Non-compete agreements (re-record restrictions)

Artist/Author obligations (delivery of product)

- Book: satisfactory form & content
- Music: satisfactory technically and commercially
- Is there a cure provision?

Bankruptcy
- Ch. 7 (K ends)
- Ch.11 (K may continue)
- Ch. 13 (K does continue)

D. DURATION

DeHaviland v. WB, Ct. App. Cal (1944) 549:

Actress contracted for one-year increments, renewable for a total of seven years. Became a
star after Gone with the Wind. She wasnt available (b/c claimed she was sick) or
unwilling to perform.
- Duration of contract is measured by the real time, not suspended/extended while
party is unavailable or unwilling to perform.

E. BANKRUPTCY

TLC filed, Toni Braxton also: both platinum sales (p560)

- Watch out for production companies (LaFace, P.Diddy, etc.): they take money off the
top from the studio. Thus artist is splitting his royalties (~50/50) with production.
- Cant declare bankruptcy in bad faith in order to escape contractual obligations
(cant be sole/primary purpose).
- Mergers of labels are common and deals carry through merger/bankruptcy. Set
up key person provision so that you have a contractual out if you lose a key
producer, etc. in merger.

In re Willie Nile, SDNY (1982) p 561:

Artist filed for bankruptcy Ch. 11, meaning he may not have to sell off his assets (but also
means may have to continue to perform K). Changed to Ch. 7, where neither of the above
apply. Studio sued to force Ch. 11 and continuation of the K, under which they were owed
~$1M.
- Court said forcing someone to file Ch.11 would be like forcing involuntary
servitude and is not allowed. Purpose of bankruptcy is to give a fresh start would be
thwarted if forced to continue. Besides, both Ch.7 & Ch.11 are voluntary (only Ch.13
can be imposed).