Actors gain notoriety for different reasons. For some, it’s due to a physical characteristic or an iconic character portrayal. For Alfonso Ribeiro, it’s a dance. The dance, which has become known worldwide as the “Carlton Dance,” is a corny dance number performed by Ribeiro’s character Carlton Banks on the 90’s sitcom “The Fresh Prince of
The Ninth Circuit recently was called upon to decide awarding attorney’s fees in a case where artists were suing for unpaid royalties under the California Resale Royalties Act (“CRRA”). In the case, Close v. Sotheby’s, Inc. (decided December 3, 2018), the Ninth Circuit ordered that the Plaintiff-artists be required to pay attorney’s fees to the defendants (eBay and art auction houses) for successfully defending against claims for unpaid royalties resulting from art sales. This conclusion required a discussion of the doctrine of preemption and a determination that defendants could still be awarded attorney’s fees under CRRA despite a finding that the bulk of Plaintiffs’ claims under the CRRA were preempted by the 1976 Copyright Act.
Plaintiffs, including the well-known artist Chuck Close, brought an action claiming that they did not receive the appropriate royalties for the sale of their works under the CRRA, which had been enacted in California in 1976. Under the CRRA, the seller of a work of fine art must withhold 5% of the sale price and remit that amount to the artist. Artists who do not receive such payments can bring a claim under the CRRA, which also has a provision that the prevailing party in such an action “shall be entitled to reasonable attorney’s fees.” The Plaintiffs essentially claimed that eBay, Sotheby’s and Christie’s had failed to remit them royalties under the CRRA for as far back as 1976.
At the district court level, the artists lost and their claims were dismissed. The district court found that the CRRA, which had been enacted in 1976, was subsequently “preempted” by the 1976 Copyright Act that went into effect in 1978. Preemption occurs where a Federal statute governs a subject matter so that it is the intent of Congress to “preempt” the state from enacting a contrary law. In essence, the district court was finding that the sole remedy for the Plaintiff-artists for claiming royalties due them was under the1976 Copyright Act and not the California state CRRA. After the Plaintiff-artists appealed the trial court’s decision to the Ninth Circuit, the Ninth Circuit affirmed the trial court for the most part but did remand some of the claims of Plaintiffs back to the trial court with regard to those sales that occurred between January 1, 1977 and January 1, 1978 (the enactment of the CRRA and the effective date of the Copyright Act). After the Ninth Circuit’s ruling, the Defendants moved for an award of attorney’s fees claiming that they were the prevailing party under the CRRA. The Plaintiff-artists opposed the request claiming that since their CRRA claims had been found to have been preempted by federal law, the defendants were not entitled to attorney’s fees under the CRRA for similar reasons.
The Ninth Circuit began by noting that the CRRA allows for an attorney’s fees award to the “prevailing party” and was mandatory because of the use of the language “shall be entitled.” Nevertheless, because the attorney fee provision had only been added to the CRRA in 1982, the Court would limit its examination of an award of attorney’s fees to those claims pertaining to sales after that date.
“Cause the players gonna play, play, play, play, play
And the haters gonna hate, hate, hate, hate, hate
Baby I’m just gonna shake, shake, shake, shake, shake
Shake it off / Shake it off
Heartbreakers gonna break, break, break, break, break
And the fakers gonna fake, fake, fake, fake, fake
If you’ve ever applied for, or researched copyright law, you likely learned one thing above all else: it’s not a perpetual right. So, how, you might wonder, have companies like The Walt Disney Company managed to maintain copyrights on certain creations for almost 100 years? In the case of the Walt Disney Company, the answer is simple. It is powerful enough that it actually changed United States copyright law before its rights were going to expire.
When copyright law was first codified in the United States pursuant to the United States Copyright Act, the copyright duration was limited to 14 years. Today, copyrights can last over 100 years. That’s a huge change, and there are an overwhelming number of copyright experts that will tell you that it is all because of a mouse.
Now that may be a slight overstatement. The copyright duration changed some prior to the creation of Mickey Mouse. The Copyright Act of 1790 included a provision that provided for an additional 14-year term if the creator was alive. Of course, at that point, copyright protection only applied to select creations such as maps and books. But 41 years later, in 1831, the Act was amended to allow for an initial 28-year term, with eligibility for a 14-year extension. Thereafter, in 1909, the Act was changed again to allow for a 28-year renewal instead.
The Ninth Circuit’s recent decision in the case of Dolby Systems, Inc. v. Christenson, focuses primarily on the issue of which party bears the initial burden of proof with regard to a “first sale” defense in a copyright infringement action. As the reader will see, however, this case really provides a cautionary tale as to the consequences a party may face when it plays games during discovery.
Adobe, a software publisher and the copyright holder for titles such as the “Photoshop” series sued Christenson in October 2009 alleging copyright and trademark infringement. (This column will not address the trademark issues.) Christenson ran a website on which he “re-sells” Adobe software, which he purchases from third party distributors apparently without Adobe’s authorization. Adobe claimed that it does not sell its software, but merely licenses them and that Christenson infringed on its copyrights when he “re-sold” its titles. Christenson claimed that his activities were protected under the First Sale Doctrine, claiming that he lawfully purchased the software from third parties, who had also “purchased” the software from Adobe.
Adobe’s lawsuit against Christenson was apparently quite contentious. The Ninth Circuit observed that the lower court proceedings were “punctuated by discovery disputes, sanctions and multiple rulings on the admissibility and exclusion of evidence.” Both parties filed cross-motions for summary judgment. The District Court, after excluding certain evidence offered by Adobe because it had not been produced during discovery, granted summary judgment in Christenson’s favor as to the copyright infringement claim after recognizing that the First Sale Defense applied. Adobe appealed this finding to the Ninth Circuit.