FALL 2013
IN THIS ISSUE
Court Rules Database Copyright Protects Individual Photos
Chanel and Jerzy Makarczyk Opt For Accelerated Case Resolution at TTAB
TTAB Cuts Renaissance Rialto's Claim of Right to Oppose Rialto Cinemas
Court Rules Database Copyright Protects Individual Photos
The U.S. Court of Appeals for the Fourth Circuit recently held that the copyright registration for a database containing text and photographs protects the individual photos so long as the proprietor owns their copyrights. Metropolitan Regional Information Systems, Inc. v. American Home Realty Network, Inc., 722 F.3d 591 (4th Cir. 2013). In addition, the Court held that electronic “click” assignments of copyrights satisfies the statutory requirement for such assignments to be in writing.
Metropolitan Regional Information Systems, Inc. (MRIS) and American Home Realty Network, Inc. (AHRN) are competitors in the real estate listing business. MRIS operates an online multiple listing service, commonly known as an “MLS,” with which it compiles property listings and related content (the MRIS Database). MRIS provides its database to real estate brokers and agent subscribers in Virginia and elsewhere.
By paying a fee and “clicking” their assent to MRIS’s terms of use, brokers and agents can upload photographs of properties to the MRIS Database. The terms of use include a provision that the brokers and agents assign their copyrights in uploaded photos to MRIS. Although MRIS does not routinely register such copyrights with the U.S. Copyright Office, MRIS puts a copyright notice on each photo and each quarter registers its copyright in the MRIS Database, stating in its applications that the copyright covers “images” or “photographs” as well as text.
AHRN is a California real estate broker that owns and operates the website NeighborCity.com, a national real estate search engine and referral business. AHRN acquires the information in its database from a variety of sources, including brokers and agents, tax assessors’ reports and other public records, and MLS compilations such as the MRIS Database. AHRN has included in its database real estate listings that contain copyrighted photos from the MRIS Database.
MRIS demanded that AHRN stop displaying MRIS’s copyrighted materials, but AHRN refused, and MRIS filed suit. The district court granted MRIS a preliminary injunction against AHRN’s use of photos from the MRIS Database, and AHRN appealed.
Section 409 of the Copyright Act provides that applications for registration of compilations, which include collective works such as many MLS databases, must provide “an identification of any preexisting work or works that it is based on or incorporates, and a brief, general statement of the additional material covered by the copyright claim being registered.” AHRN argued that because MRIS did not identify in its applications the “names of creators and titles of individual works [i.e., the photographs],” MRIS’s copyright registrations do “not extend to the individual elements in the [MRIS] Database.” The U.S. Court of Appeals disagreed, stating that “[a]s applied to a collective work whose author has also acquired the copyrights in individual component works, the text of Section 409 is ambiguous at best.”
The Court noted that Section 408 expressly permits “the Register of Copyrights to ease the burden on claimants of collective works by promulgating regulations to allow ‘for particular classes . . . a single registration for a group of related works.’” The Court pointed to Kay Berry, Inc. v. Taylor Gifts, Inc., 421 F.3d 199, 205 (3d Cir. 2005), which holds that the Copyright Act’s provision for group registration reflects Congress’s desire to liberalize the registration process (citing H.R. Rep. No. 94-1476 (1976)).
The Court said the Copyright Office’s rules, specifically, 37 C.F.R. § 202.3(b)(5)(i), permit “a single registration to be made ‘for automated databases and their updates or other derivative versions that are original works of authorship.’” Accordingly, the Court said, “the author of an automated database may file a single application covering up to three months’ worth of updates and revisions, so long as all of the updates or revisions: (1) are owned by the same copyright claimant; (2) have the same general title; (3) have a similar general content, including their subject; and (4) are similar in their organization.” Because MRIS had met those requirements, the Court held, MRIS’s copyright registrations protect the individual photos in the database.
Next, the Court turned to AHRN’s argument that, because the photo uploaders had merely “click-signed” their copyright assignments, MRIS had not met the requirement of Section 204(a) of the Copyright Act that assignments be in writing. As a preliminary matter, the Court noted that “Section 204(a) ‘was intended to resolve disputes between owners and alleged transferee[s], and was not intended to operate for the benefit of a third-party infringer when there is no dispute between the owner and transferee’” (citation and internal quotation marks omitted).
The Court subsequently stated that the federal E-Sign Act, “aiming to bring uniformity to patchwork state legislation governing electronic signatures and records, mandates that no signature be denied legal effect simply because it is in electronic form” (citing 15 U.S.C. § 7001(a)(1)). Although the E-Sign Act makes exceptions for certain types of contracts or records, copyright assignments are not among them. Thus, the Court held, “[t]o invalidate copyright transfer agreements solely because they were made electronically would thwart the clear [C]ongressional intent embodied in the E-Sign Act,” and therefore “an electronic agreement may effect a valid transfer of copyright interests under Section 204 of the Copyright Act.” For those reasons, the Court affirmed the district court’s grant of a preliminary injunction against AHRN.
Chanel and Jerzy Makarczyk Opt For Accelerated Case Resolution at TTAB
As appeared in September 1, 2013 INTA Bulletin
In an otherwise routine opposition proceeding before the Trademark Trial and Appeal Board (TTAB) the opposer, Chanel, Inc., and pro se applicant Jerzy Makarczyk decided to forgo many of the available TTAB procedures, including discovery, expert testimony, trial and an oral hearing. Instead, they opted for the TTAB’s infrequently used Accelerated Case Resolution (ACR) procedure, and the TTAB approved the parties’ stipulation regarding the same. Chanel, Inc. v. Makarczyk, Opposition No. 91208352, 106 U.S.P.Q.2d 1774 (T.T.A.B. May 13, 2013) (precedential).
Makarczyk applied to register the mark CHANEL in connection with “real estate development and construction of commercial, residential and hotel property.” Chanel filed a Notice of Opposition, alleging dilution, false suggestion of a connection and likelihood of confusion with its registered CHANEL marks, as used in connection with cosmetics, toiletries, clothing and other goods.
During their mandatory discovery conference the parties discussed participating in ACR. Shortly thereafter, and before any discovery was conducted, the parties stipulated to a number of procedural streamlining steps, certain facts and a briefing schedule, and agreed that the TTAB could resolve any issues of material fact and could issue a final ruling based on their submissions. The TTAB found the proceeding suitable for ACR. The TTAB agreed to “endeavor” to issue its final ruling within 50 days after the submission of Chanel’s reply brief—that is, by December 17, 2013, or just over a year after the proceeding was initiated.
In its approval, the TTAB noted that the final decision will still be rendered in accordance with the typical standard of proof—that is, the opposer must prove its case by a preponderance of the evidence. It also confirmed that the TTAB Interlocutory Attorney assigned to the case would be available for telephone conferences in the event of questions or issues arising out of the use of the ACR provisions. Any decision would still be appealable in the same manner as any other TTAB decision.
Many parties involved in TTAB proceedings have been reluctant to use ACR, as it remains fairly untested. However, this case may be a particularly suitable candidate for ACR because the parties stipulated to a number of facts, including that Chanel is the senior user of the CHANEL mark, that the parties’ marks are identical, and that Chanel never consented to Makarczyk’s use of the mark CHANEL.
TTAB Cuts Renaissance Rialto's Claim of Right to Oppose Rialto Cinemas
As appeared in September 15, 2013 INTA Bulletin
The Trademark Trial and Appeal Board (TTAB or Board) held that a movie theater company did not acquire its transferor’s right to oppose an application because the transfer agreement did not transfer any trademark rights. Renaissance Rialto Inc. v. Ky Boyd, Opposition No. 91197602 (T.T.A.B. May 31, 2013) (precedential).
Opposer Renaissance Rialto Inc. sought to block applicant Ky Boyd from registering the mark RIALTO CINEMAS, as used in connection with “movie theaters” in Class 41. Renaissance pleaded several alternative grounds for the opposition, including prior use of the mark, descriptiveness of the mark, genericness of the mark and fraud (based on Mr. Boyd’s allegedly false claim of exclusive rights in the mark).
The TTAB did not have to rule on any of those grounds, however, because it found that Renaissance had no standing to oppose the RIALTO CINEMAS application. The USPTO published the application on September 7, 2010, meaning that the deadline to oppose was October 7, 2010, and Renaissance did not file its notice of opposition until November 23, 2010.
Renaissance claimed that a third party, Lakeside Cinema Partners LLC, had obtained an extension of time until January 5, 2011, to oppose the application and, by an agreement dated November 1, 2010, transferred to Renaissance the right to oppose. The agreement also transferred to Renaissance the rights, if any, that Lakeside Cinema had in the mark RIALTO CINEMAS, rights that Lakeside Cinema would have acquired, if at all, from Mr. Boyd, who was the leaseholder of the Rialto Cinemas theaters before Lakeside Cinema acquired the lease. However, Renaissance submitted no evidence that Lakeside Cinema had ever used the mark RIALTO CINEMAS, and there was evidence of record that Lakeside Cinema had not, in fact, used that mark to brand its movie theaters and may not have had the right do so.
The TTAB said that “[a] party which files an opposition during an extended opposition period must have obtained the extension in its own name or must be in privity with the party that filed the request for an extension of time to oppose.” This is so, the Board noted, because “an extension of time to oppose is a personal privilege” and therefore requires more than that two parties “share the same objection to the issuance of a registration to [the] applicant” (citing Cass Logistics Inc. v. McKesson Corp., 27 U.S.P.Q.2d 1075, 1077 (T.T.A.B. 1993)). The TTAB also noted that privity “generally includes, inter alia, the relationship of successive ownership of a mark (e.g., assignor, assignee)” (citing TTAB Manual of Procedure § 206.02).
After reviewing the evidence, the TTAB found that “there has been an insufficient showing of use by Lakeside Cinema of the mark that it purports to transfer in the Transfer Agreement” and, therefore, “Lakeside Cinema transferred only the bare right to oppose applicant’s registration.” The Board held that “acquisition of another’s right to oppose, independent of a transfer of rights to a trademark and its associated goodwill, is an insufficient basis upon which to claim the benefit of the transferor’s personal privilege in an extension of time to oppose an application” (citation omitted). Accordingly, the TTAB ruled that it had no jurisdiction and dismissed the opposition “without prejudice to opposer’s right to file a petition for cancellation, if otherwise appropriate.”
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