Tag: Ninth Circuit Court of Appeals

Things Creators Can Learn From Seuss v. ComicMix

I listened yesterday morning to oral arguments presented (via video conference) on Monday before the Ninth Circuit Court of Appeals in the case Dr. Seuss Enterprises v. ComicMix LLC. As a quick recap, in 2016, Dr. Seuss Enterprises (DSE) filed a copyright claim against publisher ComicMix over a mash-up book called Oh, the Places You’ll Boldly Go!. The author/illustrator team who created the work used iconic illustrations from various titles in the Seuss portfolio, and combined the images with themes and characters from the Start Trek series. In 2019, a California District Court found that “Boldly” was fair use, applying first and fourth factor analyses that many creators found troubling. 

For deeper dives into the legal particulars, see my post from last August and/or posts here and here by Stephen Carlisle of NOVA Southeastern University. But suffice to say, I think most copyright watchers would agree that the appellate panel also found the District Court’s fair use analysis disconcerting and will at least remand, if it does not overturn the decision. Already quoted on social media by copyright advocates is this riposte by Judge M. Margaret McKeown:

“The district court seemed to take the position that if you take existing expression and then you interspersed it with new expression, you have a transformative work. That is a definition of transformative use that I haven’t seen before. It would seem to sting the notion of copyright protection, and almost everything would be a fair use.”

While it can be folly to read too much into judges’ comments at oral arguments, the panel did seem to express concern with three key points in this case:  1) that the lower court may have erred in finding “Boldly” a transformative work under the first fair use factor; 2) that the lower court applied the wrong analysis in considering the potential market harm to DSE under the fourth fair use factor; and 3) as a procedural matter intertwining the two factors, that even a correct finding of transformativeness does not shift the burden from the defendant to the plaintiff to disprove (or prove) potential market harm under the fourth factor. 

Now, I could break down what that all means, but would frankly rather wait until the court renders its decision, and, in the meantime, note that the complexity implied by these considerations leads to a different proposal I would make to most creators out there:  Don’t do this to yourselves. There are way better places you could go.

If you have talent and a desire to express something to the world—and you would rather spend your time creating works than fighting legal battles—the decisions made by “Boldly’s” authors in this instance provide a pretty good guide (Things 1-5, if you will) for avoiding legal complications, even if you want to parody classic material.  

Thing One – Learn What Parody Is

Thanks, in large part, to the volume of works used in funny YouTube videos and such, the word parody is too often invoked to describe every use of a work for the purpose of comic effect. This is an error, both as a literary and legal definition of parody. As discussed in more detail in this post in 2014, a true parody must comment on the original work being used. When ComicMix attorney Dan Booth was asked about this distinction on Monday, he averred that “Boldly” parodies the original work because Seuss’s character is “individualistic and narcissistic,” while Star Trek conveys themes of “teamwork” and “universalism.” 

While I am in no position to judge evidence I cannot fully review, that sounds like a very slippery (i.e. loose) grasp on any claim to parody. Merely using protected works in a new context does not favor a finding of fair use. If “Boldly” is indeed a parody, it should directly lampoon the values or ideas expressed in “Go” by mocking or critiquing Seuss’s original themes of individual empowerment through imagining possibilities. (And even then, we get into some murky waters with regard to copying visual works for the purpose of commenting on textual expression. But let’s not go there, boldly or otherwise, right now.)

I would further argue that the authors’ use of illustrations from multiple Seuss books militates against a finding that “Boldly” is directly commenting upon “Go.” In fact, one illustration from “Boldly,” shown on this ComicMix post from 2017, depicts two Spocks in the manner of Seuss’s The Zax, and the text actually reinforces a theme of individuality. So, maybe there is real parody in “Boldly” somewhere, but it doesn’t sound like there is.  

Thing Two – A Mashup is Not Automatically Fair Use

At oral argument, Booth described the mashup as an “innovative form that takes different sources and puts them in dialogue with one another.” Okay. But even if that were a universally applied description of the mashup aesthetic, it does nothing to place the form in any special category of consideration under a fair use analysis. 

As a general statement, one can assume that, for instance, two sources “in dialogue with one another” will create a third voice, and that this would be consistent with the purpose of fair use, but any given mashup will be subject to the same case-by-case analysis that will be applied to any other type of use. Moreover, because mashups generally involve works owned by more than one copyright owner, they can invite more than one legal complaint.

Thing Three – Apply an Inverse Rule When Creating Parody

One of the errors I find most troubling in this case, even to hear it presented, is the implication that ComicMix needed to create imitations of Seuss’s visual works in order to convey the parodic nature of “Boldly” (assuming parody is even present). This argument is anathema to what I would describe as an inverse proportion rule that says:  The more widely recognized the original work, the less the parodist needs to copy in order to express a commentary about the work.

Seuss’s illustrations are so iconic and so universally recognized that one need not copy every tittle and jot with the precision of a Talmudic scribe in order to lampoon the work—if indeed parody is the real goal. On the contrary, a true parodist would seek to mock an artist’s visual language by selecting certain characteristics to overstate or understate, rather than create a work that so slavishly mimics the original that an ordinary observer would fail to perceive that any visual parody exists at all.

This is one of the weakest aspects of ComicMix’s appeal to parody in my view—that an average consumer, seeing “Boldly” on a store shelf, might easily think that DSE had produced the mashup. Never mind the trademark implications, but a sendup of Dr. Seuss should be almost immediately recognizable as not Seuss and yet Seuss-like enough to know that a joke is being conveyed. We see examples of effective parody through limited copying all the time. Hence the general fair use guideline, to take only as much of the work as necessary is, in fact, easier to apply when parodying the most recognizable works.

Thing Four – Be More Creative

Let’s be honest. A great deal of the time, making substantial use of existing works—especially works as famous as the Geisel oeuvre—is motivated by marketing more than a burning need to express something new. Again, I won’t judge “Boldly” as a work without being able to read the whole thing—and its creators are experienced professionals—but Seuss is such an obvious source for this kind of appropriation that it is difficult to see such uses as more than gimmicks, seeking to profit off the notoriety of the original. 

My oldest kid and I used to riff on the idea of famous Nazis reading Seuss-like works to children, including the book Oh, Zee Places You Vill Invade (and let’s not get started on the Sneetches with the stars.) But if we had developed that inside joke into a book a la “Boldly,” would it imply transformativeness under a fair use analysis? 

The target of the mockery isn’t Seuss, it’s Nazis. Seuss is merely an obvious context in which to place Nazis for satirical effect, but that would not make this hypothetical use a fair use. More specifically, if we did produce such a book, would we need to slavishly copy Seuss’s illustrations to make the joke work? Nope. Readers would get it through the use of illustrations that evoke Seussness without copying Seuss. 

Thing 5 – Work Around Copyright

Finally, if the goal is to produce new creative works—rather than spend years in copyright disputes—it is worth remembering the many, many stories in which creators start out intending to use existing works and then, by navigating around copyrights, discover new and better ideas that would not have occurred otherwise. Happens all the time. 

I wrote about this process in 2013, and that post was later cited in a paper by scholar Joseph Fishman called Working Around Copyright, in which he describes, in legal-scholar terms, what millions of creators already know: that overcoming obstacles to initial creative instincts tends to produce better results. And when that first instinct is to copy protected works, there’s a good chance that the still-untapped idea is probably much better.  

FilmOn Not a “Cable Provider” Says Ninth Circuit

A recurring narrative promoted by the internet industry and its cheerleaders is that the old creative industry, which relies on copyright law, is “outdated.”  The major rights holders, they keep saying, “cling to old models,” pretending the future is not happening.  Of course this new v old narrative is more than a misleading PR message—it is a gross hypocrisy if you follow the story behind the tweets, headlines, and comment threads.

Because if we were to summarize the story of copyright in cyberspace, it is generally one in which new business models seek to rely rather heavily on loopholes and loose interpretations of old law in order to succeed.  Time and again, the courts try to wrestle with new business ventures, whose owners hope for favorable interpretations of statutes that were written long before their models were imaginable, let alone possible. And much of the time, these “new” businesses represent various ways to exploit creative works without payment or permission.  Such is the case with a service called FilmOn, which hit a major setback this week in the Ninth Circuit Court of Appeals.

Essentially, FilmOn captures television broadcasts via the airwaves and then retransmits the content to paying customers over the internet. Several broadcasters, who are named collectively in the case as Fox, sued on the basis that FilmOn infringes the exclusive right of publicly performance. Like Aereo, FilmOn had argued in several courts that its service does not “publicly perform” works, but when the Supreme Court held that Aereo’s very similar model did infringe this exclusive right, FilmOn changed its defense strategy.

Instead of going for no licensing, FilmOn has been vying for cheap licensing by arguing that the company can be defined as a “cable provider” under the terms of §111 of the Copyright Act. “Cable providers” are eligible for compulsory, government-set licenses which obviate the need to negotiate with individual rights holders for retransmission of creative works.  A district court agreed that FilmOn qualifies as a “cable provider,” but the Ninth Circuit has now reversed that decision. And although the court has stated that both FilmOn and the broadcasters presented plausible interpretations of §111, the opinion appears to have turned on two factors:  context and deference to the Copyright Office.

In its analysis of the exception carved out in §111 with the 1976 Copyright Act, the circuit court notes the balance struck between the interests of copyright holders and the need to serve segments of the population that lived in remote locations.  §111 was designed to enable a network of local cable providers to make the large, capital investments necessary to serve these smaller markets without the added burden of negotiating terms with individual rights holders. Moreover, those cable companies were subject to FCC regulation, including “must-carry” provisions mandating certain content be transmitted just for them to be allowed to operate.  From the Ninth-Circuit opinion …

“… in 1976 the cable industry was a fledgling one; cable systems had little market power and little ability to overcome the considerable transaction costs they would incur if they had to negotiate individual licenses directly with copyright owners. Congress responded to these economic conditions by enacting § 111, which relieved cable systems of the need to sit down with every copyright holder before retransmitting their copyrighted broadcast works. … Fundamentally, however, § 111 was Congress’s attempt to balance the socially useful role cable systems had come to play, on the one hand, against the property interests and creative incentives of copyright holders, on the other.”

By contrast, the court observes that FilmOn is operating in a very different market as a business that a) does not have to make the kind of capital investments as 70s-era cable companies; and b) can reach far beyond a local market to potentially any viewer in the world via the internet.  So, although the court stipulates that FilmOn’s statutory interpretation of §111 is not wholly without merit, the panel ultimately defers to the assumption that Congress intended to maintain balance between protecting copyright and serving the remote markets via the more limited technology that existed at the time the statute was written.

Additionally, in light of its finding that both the broadcasters and FilmOn provide reasonable interpretations of §111, the court gave considerable weight to past testimony by the Copyright Office, which has, since the 1990s, asserted that internet-based companies like FilmOn are not “cable providers” under the terms of the statute.  Quoting from the preambles to the USCO 1992 and 1997 rulemaking proceedings, “… a provider of broadcast signals [must] be an inherently localized transmission media of limited availability to qualify as a cable system.” In other words, the ability to transmit globally via the internet exceeds the intent of §111.

Everything about the rationales applied to write §111, including the three tiers of statutory rates based on system size, is predicated on an analysis of local markets.  This includes matters like local advertisers who pay relatively low rates to reach a local customer base via their “cable providers.”  That small-town hardware store ad you see pays pennies on the dollar compared to a major brand reaching millions via national broadcast, and this factors into the calculus of what makes a “cable provider” eligible for which compulsory license under the terms of the statute.

There is simply no reasonable way to argue that a business like FilmOn, which retransmits a signal to the entire world via the internet, achieves the goals of Congress in establishing the compulsory license regime for “cable providers.” But as I say, this is a recurring theme in the copyright narrative. In the world of PR, these companies portray themselves as new, progressive, forward-thinking, etc.  But in order to avoid paying for the creative works they need to operate, they try very hard in the courts to look like they’re just business as usual.

Prison for password sharing? Not likely.

After a ruling by the Ninth Circuit Court of Appeals, a number of blogs and articles appeared with headlines announcing that it is now a federal crime if, for instance, your kid uses your Netflix password.  While that kind of headline is good for traffic and buzz, it’s also typically exaggerated and misleading—at least insofar as this recent decision is concerned.

At the heart of the matter is the Computer Fraud and Abuse Act (CFAA), which has been sharply criticized for years by a number of civil liberties advocates who focus on digital-age issues.  The CFAA may also be referred to generically as the anti-hacking law, and there is perhaps legitimate concern that the language in the statute is overly broad and may therefore be abused by a capricious prosecutor to indict people who commit minor offenses (or non-offenses) under a law written to address serious cyber crimes.

The appeals court decision that ignited the recent flurry of headlines, United States v Nosal, concerns David Nosal, a former employee of the executive search firm Korn/Ferry. After being dismissed from the firm, Nosal “convinced some of  his  former  colleagues  who  were  still  working  for Korn/Ferry  to  help  him  start  a  competing  business.  The employees used  their  log-in  credentials  to  download  source lists, names and contact information from a confidential database  on  the  company’s computer,  and  then  transferred  that information to Nosal.”  This is a partial description of facts as stated in the Ninth Circuit’s en banc opinion issued April 2012 in the same case.

There appears to be no dispute in the matter of Nosal’s criminal liability under several other statutes regarding his unauthorized access of Korn/Ferry’s protected data, but the appeal pertaining to CFAA hinges on what critics—and at least some judges—feel is ambiguity over the meaning of “authority” to access a computer.  Because one of Nosal’s former colleagues still had credentials to log into the firm’s computers and because she voluntarily shared those credentials, can Nosal then be charged with violation of CFAA?  Does authority come from the credential holder or the computer owner?  Right there is where civil libertarians and dissenting judges say the ambiguity in the language could jeopardize you and me and every other citizen who voluntarily shares a password with a friend or family member for innocuous access to our personal accounts.  From the EFF …

“Nosal’s colleagues had the authority of an authorized user, the current employee who lent her credentials. Thus, if “authority” can come from the account holder—as with a wife who lends her bank credentials to her husband to pay a bill, a college student who uses a parent’s Hulu or Amazon password, or someone who checks Facebook for a sick friend—then Nosal and his colleagues did not violate the CFAA.”

I wouldn’t call the distinction irrelevant, but neither would I call this case a particularly good reason for everyone to overreact, which has no doubt already happened on social media threads everywhere.  The employee with “authorized” access to Korn/Ferry’s database may well have given her permission to Nosal and others to use her login credentials, but that in itself was a criminal violation and a permission she had no “authority” to grant under any circumstances.  The majority opinion from the court is extensive on this point and argues that its interpretation of “authority” is both clear and consistent with sister circuit court decisions in precedent cases.

Meanwhile, even a very narrow interpretation of “authority” in Nosal’s case is a far cry from comparing these circumstances to the fact that I have a Netflix account which enables up to four devices simultaneous access to the service and that one of these may be used by my college-student son.  That’s what Netflix expects a family to do with an account that allows multi-device access.  Moreover, unlike Nosal’s “inside woman” at Korn/Ferry, I do have authority to give permission to a friend or spouse to log into my Facebook account.  Neither Facebook nor the federal government can mandate that the account holder has to be the individual who types in the credentials—to say nothing of ever proving such evidence—so it seems like gratuitous hyperbole for EFF and other critics to compare these everyday examples to Nosal.  Still, the three-judge panel had one dissenting opinion, which the EFF describes as follows:

“While the majority opinion said that the facts of this case “bear little resemblance” to the kind of password sharing that people often do, Judge Reinhardt’s dissent notes that it fails to provide an explanation of why that is. Using an analogy in which a woman uses her husband’s user credentials to access his bank account to pay bills, Judge Reinhardt noted: “So long as the wife knows that the bank does not give her permission to access its servers in any manner, she is in the same position as Nosal and his associates.” As a result, although the majority says otherwise, the court turned anyone who has ever used someone else’s password without the approval of the computer owner into a potential felon.”

Indeed, we may now be a nation of felons, and if this is so, then Congress better get on that.  But the fact that we are all guilty is the first reason we might want to calm down a bit before reacting to those scary headlines and getting in a big sweat about it.  Also, while I lack the credentials to argue with an appeals court judge, I’m going to a little because the wife in Judge Reinhardt’s example does have her husband’s permission to access the bank account, and the husband has the authority to grant her that permission. Judge Reinhardt knows this, though, and his point is that the statute ought to reflect the distinction between this common, family banking example and the Nosal case in which the individual with the credentials did not have “authority” to grant access.  Reinhardt writes the following in his dissenting opinion:

“The majority [opinion] does not provide, nor do I see, a workable line which separates the consensual password sharing in this case from the consensual password sharing of millions of legitimate account holders, which may also be contrary to the policies of system owners. There simply is no limiting principle in the majority’s world of lawful and unlawful password sharing.”

Perhaps Congress will need to review CFAA, but it seems simple enough to observe that “authority” to grant access will be predicated on the relationship between the login credential holder and the data being accessed. Korn/Ferry owns 100% of the data on its computer servers, its employees may only access that data under the conditions and permissions of the firm, and this access may be revoked at the sole discretion of the firm without question.  In short, nothing in the database belongs to any of the employee/users, who therefore have no authority ever to share access with anyone. In such a scenario, only the computer owner can have the “authority” to grant access.

This is very different from the relationship between a bank and a customer vis-a-vis one’s own account information pertaining to one’s own money. The bank owns the servers and the systems just like the bank owns the vault, but the customer owns the account information and assets in the account and has full discretion to use the information or assets as he sees fit, while the bank has very restricted authority to access or exploit either the data or the assets under management. Reinhardt’s comparison might be more compelling if the wife in the scenario were cheating on her husband and so gave the login credentials to a dashing third party to drain the bank account so they could run off to the Caribbean together.  In this soap opera, could said dashing third party (DTP) be indicted under CFAA in addition to other criminal charges? Arguably, the wife had more authority to grant access to the DTP than the Korn/Ferry employee had to grant access to Nosal, so I imagine CFAA would be an over-reach in this situation.

In the case of a Facebook account, the “ownership” question remains a bit vague. Many social media companies lay claim in their Terms of Service to “ownership” of every word and image we share on their platforms, but does that make these companies the “owners” of the data in the same way that Korn/Ferry owns its data?  I would argue it does not, especially since none of our shared social media data can be called “private” or Facebook’s “trade secrets.” As with the banking example, a social media account involves a shared “authority” to access based on the relationship between the data and the account holder; and this would seem to void any assumed violation of CFAA.  Regardless, it will likely be years before these questions are officially resolved, but I wouldn’t lose years of sleep in the meantime worrying about felony charges for common password sharing.