A change in the rules for Oscar eligibility proposed by the Academy of Motion Pictures Arts and Sciences (AMPAS) may violate antitrust laws, according to the Department of Justice.

At issue is whether feature-length films produced by streaming services like Netflix should be eligible for Oscar consideration, even though they don’t have a significant theatrical run. The DOJ weighed in on the issue in the wake of reports that Academy board member Steven Spielberg was planning to push for such a rule change.

Spielberg first made his views on the subject known last year, telling ITV News that, while Netflix and other streaming platforms have elevated the quality of television, “once you commit to a television format, you’re a TV movie… If it’s a good show [it] deserve[s] an Emmy, but not an Oscar.” In Spielberg’s view, the movie theater experience is essential to truly appreciate and reward the cinematic art form. His proposed rule change would preclude Oscar eligibility for films that do not have a significant theatrical run.

But in a March 21 letter, DOJ antitrust chief, Makan Delrahim warned the Academy that such a rule may violate Section 1 of the Sherman Act, which “prohibits anticompetitive agreements among competitors.”

“Accordingly,” Delrahim cautioned, “agreements among competitors to exclude new competitors can violate the antitrust laws when their purpose or effect is to impede competition by goods or services that customers purchase and enjoy but which threaten the profits of incumbent firms…

[I]f the Academy adopts a new rule to exclude certain types of films, such as films distributed via online streaming services, from eligibility for the Oscars, and that exclusion tends to diminish the excluded films’ sales, that rule could therefore violate Section 1.”

The proposed rule change was seen by some as a direct attack on Netflix. Though the streaming service has garnered increasing acclaim for its feature films – including Alfonso Cuaron’s “Roma”, which took home three Oscars this year – it typically does not release its films in theaters.

Netflix responded to reports of Spielberg’s comments early last month, tweeting:

“We love cinema. Here are some things we also love:

  • Access for people who can’t always afford, or live in towns without, theaters
  • Letting everyone, everywhere enjoy releases at the same time
  • Giving filmmakers more ways to share art[.]

These things are not mutually exclusive.”

Notwithstanding Netflix’s populist appeal, the DOJ’s position in defense of the streaming service’s Oscar aspirations simply may not hold water.

First, the objective of antitrust law is to protect the process of competition for the benefit of consumers, making sure there are strong incentives for businesses to operate efficiently, keep prices down, and keep quality up. Accordingly, the Sherman Act does not prohibit every restraint of trade, only those that are unreasonable. The DOJ’s position on the Academy’s proposed rule assumes both the manner and degree to which consumers are ultimately impacted by Oscar noms.  The anticompetitive impact may very well be too minor, speculative, or indirect to be considered “unreasonable.”

Second, the Academy is not a trade association in the model contemplated by the Sherman Act. Per se violations of the Act include plain arrangements among competing individuals or businesses to fix prices, divide markets, or rig bids.  Despite the Academy’s origins as a “company union,” today, it’s a collective of individuals from across the international film community.   Its membership includes several streaming service execs, and the majority of members have no particular studio affiliation or allegiance.

The Board of Governors will meet on April 23 for its annual awards rules meeting. The Academy hasn’t said whether it will consider the rule change.

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Rappers Terrence “2 Milly” Ferguson and James “BlocBoy JB” Baker, influencer Russell “Backpack Kid” Horning, and actor Alfonso Ribeiro (best known for his role as “Carlton Banks” in the sitcom “The Fresh Prince of Bel-Air”) have dismissed their claims against Epic Games for allegedly infringing their signature dance moves in the wildly popular videogame “Fortnite.”

“Fortnite” is an animated battle royale where fictional characters perform a victory dance after defeating an opponent.  “Pay or Play” previously reported on these cases in December, and it appeared many months would pass before the final curtain call.  Yet none of the cases got beyond the pleading stage.

The dismissals came about a month after the U.S. Copyright Office released its decision not to register Ribeiro’s dance routine.  According to the letter, although the Copyright Act does protect choreographic works, Robeiro’s moves constituted a “simple dance routine,” and “social dances, simple routines, and other uncopyrightable movements are not ‘choreographic works’ under the Act.”

In February, Epic moved to dismiss the plaintiffs’ claims under California’s anti-SLAPP statute and argued all of the moves alleged to be infringed were “simple routines” consisting of basic body movements.  Epic noted that placing these moves, such as an arm swing, side step, or head dip, outside the public domain would “cause every person who performs the step on television, at a wedding, or in any other public place to be susceptible to a copyright infringement claim.”  Regardless, Epic argued that the “Fortnite” version of the dances were not substantially similar to the plaintiffs’ performances in that the moves varied, were displayed at different tempos, and were depicted in a transformative context (i.e., celebrating victory on the battlefield vs. acting in a sitcom or music video, or performing on live television).  Additionally, Epic contended plaintiffs’ right of publicity claims were meritless because the game’s avatars have no resemblance to the plaintiffs and the value of the game does not principally derive from the plaintiffs’ fame.

All of the dismissals came before Epic’s anti-SLAPP motion could be decided and were without prejudice, which indicates these suits could be revived at some point.  But for now, it appears Epic will have the last dance.

The Writers Guild of America (WGA) and the major talent agencies are headed for a showdown. The consequences are literally unknowable but could upend the way the television business has operated for decades. This blog will tell you what’s behind the fight and what each side has been saying about it. A disclaimer before I proceed, however. This firm represents many writers and of course works closely with their agents. It is not my intention to take sides and I welcome comment from any who think I have misrepresented their position.

Talent agencies licensed by the State of California have a statutory monopoly over the procurement of employment in the entertainment industry. New York has a similar statute. The guilds representing writers, directors and performers have piggybacked on this statutory regime to assert the right to impose their own franchise agreements on the agencies, which they negotiate through the agents’ representative body the Association of Talent Agencies (ATA). These agreements vary among the three unions, but include provisions for example limiting the agents’ rights to collect commissions on residuals and permitting clients to terminate agency agreements when their agents aren’t getting them work. These franchise agreements have remained substantially unchanged for years and have accrued substantial precedential value. For example, the performer’s union SAG (now SAG-AFTRA) attempted unsuccessfully to overhaul their franchise agreement in 2002 and the agreement expired yet both union and agencies have continued to operate more or less as if it had remained in force. Now the WGA franchise agreement is about to expire, and despite this history the Guild is demanding huge changes in the way the agencies do business. Renounce packaging and producing, it says, or we will seek a vote authorizing us to require our members to fire their agents who do not cooperate. Although the ATA and WGA have had several negotiating sessions since the WGA announced its position, very little progress has been made. What is at stake that prompts the parties to put so much at risk?

In its ideal state, packaging is a practice by which an agency will assemble a number of key creative elements on a show from among its clients, e.g, the creator, showrunner, directors and star, and sell it to a studio or network. Then, rather than collect a 10% commission off the fees paid to each individual client, it receives a commission (typically 3%) out of the network license fee or show budget paid directly by the studio or network for the life of the series, another 3% of the license fee or budget deferred and paid out of first net profits, and 10% of backend revenues. As the agents see it, both they and their clients benefit from this practice. The clients save the 10% they would otherwise be paying out of their fees, while agents stand to make considerably more than they would in a straight commission situation. It also benefits the agency’s lower-level clients by giving them preferred access to jobs on that show.

The writers have a different view. They say that when an agency’s compensation is severed from its clients’, there is an inherent conflict of interest. The WGA has released numerous public statements in which writers recounted instances in which they claim their agents used a package position to benefit themselves at the expense of their writer clients. Many show creators expressed incredulity that their agents got package commission on shows they’d played no part in selling. Some went further to complain that when the agents were active in pitching their shows, they sold them to a less attractive buyer that offered a package rather than a make a better deal with a buyer that did not. Some even claimed that their agency had killed a deal entirely because a buyer refused to give it a package. Mid- and lower-level writers expressed concern that their agents were accepting inferior deals for them rather than disturb their cozy relationship with the buyers, especially since the package commission would be the same regardless.

The agencies have also been sticking their toes in the water as producers, albeit indirectly. On its face, this is a more direct conflict of interest than packaging, because the agencies are directly employing their clients, and indeed the franchise agreements of all three guilds prohibit this practice. Recently, however, as some of the biggest agencies have grown in size and scope, they’ve formed affiliated production companies which they say will operate at arms’ length from their agency affiliates. A further complication is that some of these production companies are WGA signatories, which means the union consented to permit them to hire WGA writers, a position it now disavows.

Agents have been packaging programs for decades. Writers have grumbled about it in the past, but have never before joined forces to take what is after all a considerable risk to them in order to try to force a change. A number of other factors are at play that have brought these issues to a head. First, the agency business itself has been changing. While writers have tolerated the perceived unfairness of television packaging, many regard the agencies’ forays into producing as a step too far. The big agencies have also accepted outside investment in order to diversify into sports, fashion, consulting and other areas far outside their traditional businesses of talent representation. This has tended to increase the sense of some clients that their agents’ interests are not necessarily aligned with their own. All this is happening while outside economic pressures on writers are increasing. Although the explosion in programming from streaming services has created more job openings, it hasn’t always put more money in the pockets of working writers. Where a season of a successful series on a broadcast network will comprise 22 episodes plus generous residuals, cable and streaming series orders will be 8, 10 or 13 episodes, with much smaller residuals, if any. Moreover, despite the shorter orders, the producers of these series still require the same level of exclusivity as for broadcast, so that writers must hold themselves off the market for much lower guaranteed fees.

This dispute will be coming to a head very soon. The current WGA franchise agreement expires on April 6. The WGA is insisting as a condition of renewing that agreement that the ATA agree to a Code of Conduct in which they will give up packaging and sever ties with their production company affiliates. WGA members will be voting this week whether to approve a resolution requiring writers to fire their agents if the agents do not sign the Code of Conduct. Meanwhile, very little progress has been made in negotiations between the WGA and ATA to reach a less drastic solution. If those negotiations fail and the writers approve the resolution, the outcome will be unpredictable. Some writers could break ranks and choose not to fire their agents. For example, writers who work primarily in features do not have a stake in the packaging debate. There could also be a split in the agency ranks, as smaller agencies, which depend less on packaging and not at all on producing, seize the opportunity to pick off clients from the big four (WME, CAA, UTA and ICM). Or the parties could stand firm and a new ecosystem could develop for marketing and staffing projects. The WGA has openly solicited managers and lawyers to fill this role, notwithstanding that they would be vulnerable to penalties as unlicensed talent agents. The Guild has also announced a system under which writers will submit themselves directly to showrunners for hiring.

It is still possible that the parties will make a deal in the eleventh hour. In the meantime, it’s fair to say that Hollywood is nervously awaiting what will come next.

 

 

Bette Davis and Joan Crawford never “tweeted” about their so-called rivalry – and that’s probably for the better.

Throughout the Golden Age of Hollywood, consumers were not exposed to each and every thought and opinion of top actors like Jimmy Stewart, Bette Davis, and Joan Crawford. The lack of technology at that time kept the public from knowing many personal, social, and political views of entertainers that hadn’t been carefully curated for public consumption.

Today, social media has opened a large door of instant communication. Like many things, this can be a positive and a negative. One “tweet” can expose a celebrity’s unpopular views and nearly instantaneously ruin his or her career.  Screenshots from fellow internet users and websites aggregating content can expose statements from the past that quickly change a person’s image tomorrow.

The news media – both traditional and modern — can add to the pressure on content creators to hold entertainers accountable for all statements. This presents a big issue for morals clauses often found in talent agreements in the entertainment industry.

What is a Morals Clause?

A morals clause prohibits an artist from engaging in conduct (and sometimes speech) that will bring either the artist or the other party to the contract (generally, a studio, production company, or network) into “public disrepute, scandal, embarrassment,” or generally cast a bad light on the company’s reputation.  Criminal conduct commonly falls under the definition of prohibited acts in a morals clause, but acts that fall short of breaking the law can violate the clause, too. For example, some morals clauses prohibit conduct that is offensive, shocks or insults public morals or public decency. Companies generally push for morals clauses in their contracts to protect their brand and reputation.

Further, companies and studios negotiating morals clauses typically seek to keep the language defining the objectionable conduct broad, so as to cover a range of conduct that would breach the agreement. The rationale for these companies is that they’re making an investment by hiring the artist for an endorsement deal, or a talent deal (such as an acting agreement) where that person’s face (and likely their actions) are associated with that company – on and off screen. From the studio’s perspective, maintaining a clean image is crucial – particularly in today’s climate where allegations of sexual misconduct, gender discrimination, and racial discrimination are quickly judged by the court of public opinion.

On the other hand, artists and athletes in talent and endorsement deals will push for more narrow language that specifies the exact conduct that is prohibited. Attorneys negotiating on behalf of entertainers may request that only criminal convictions violate the morals clause, not merely accusations, charges, or even proceedings.

It Starts With a “Tweet”

The following scenario is fairly common: 1) an actor employed by a film studio makes a controversial statement on his or her official Twitter account; 2) the actor’s statement instantly reaches thousands, or millions of followers, some argue they are offended, others defend the actor; 3) media outlets report the controversial statement, questioning why the film studio continues to employ this actor; and 4) now the pressure is on the film studio to make a decision: continue to employ the actor and face backlash, or enforce the morals clause and likely terminate the actor from the production. One tweet can have a major domino effect. Talk show appearances and interviews are often mapped out by talking points to protect an artist from discussing a detrimental topic. However, lawyers, managers, and publicists may not always know when an artist will send a “tweet” or what the artist will say – nor can they control it. Thus, due to the personal nature of social media, an entertainer may not have fully vetted a statement with his or her representatives prior to releasing it to the world via Twitter or Instagram.

Some say that information is “weaponized” in the era of #MeToo, Time’s Up, and other campaigns that seek to hold people accountable for their actions, today and in the past. Attorneys working with entertainment industry clients have a bigger incentive now more than ever to make clients aware of the parameters of morals clauses.  It’s important for entertainers to understand that something as quick and simple as a “tweet” can turn into a violation of a morals clause. Further, even if the public doesn’t discuss a “tweet” today, it can lurk on the internet, only to be placed in the spotlight in the future.

How do these old “tweets” resurface? While some entertainers quickly delete “tweets” and other social media posts when a controversy arises, they should be mindful of screenshot technology and websites that are in the business of archiving older social media posts, even those that are deleted. This means, a “tweet” from 2010 may be uncovered today, instantly impacting how the public views that entertainer.

Understanding the Parameters of a Morals Clause

It’s important for entertainers to understand the remedies available to a company he or she has contracted with in the event of a morals clause violation. Can the company terminate immediately due to a violation of a morals clause? Is there a cure period? There is sometimes room for interpretation as to what exact conduct constitutes a breach, and whether the artist has engaged in that conduct. Many agreements will allow a studio or network to terminate the agreement or suspend the talent’s services due to the talent’s violation of a morals clause.

One solution (although an extreme one) to prevent a morals clause mishap may be to stop using social media altogether.  This is unlikely to happen as social media has become an increasingly lucrative marketing tool and entrepreneurship vehicle for many entertainers. Another solution could be for public relations teams to step in and vet an artist’s “tweets” and other social media postings prior to publication. Some artists include their lawyers when drafting messages to fans. Some artists simply allow their representatives to run their social media accounts. This still leaves open the possibility of spontaneous social media posts that make the artist look bad.

In short, it can greatly benefit entertainers to be aware of their morals clauses. Entertainers should think twice, and a third time, before pressing the blue “tweet” button. For entertainers that don’t want to think twice before going on that “Twitter rant,” in the words recited by Bette Davis: “Fasten your seatbelts, it’s going to be a bumpy night.”

William Shakespeare’s character Juliet famously asked Romeo “What’s in a name?” The question still rings true today, and the answer may be, well, a lot.

The Power of a Name

The value in Grammy-award winning singer Rihanna’s name, her surname specifically, is at the center of a legal dispute between her and her father.

Robyn Rihanna Fenty, known worldwide as Rihanna, sued her father, Ronald Fenty (“Mr. Fenty”) alleging he used their surname, Fenty, to mislead consumers into thinking she was associated with his business, Fenty Entertainment LLC. Rihanna filed suit in the U.S. District Court for the Central District of California against Mr. Fenty and his business partner, Moses Joktan Perkins, claiming a violation her right of publicity, false designation of origin, and false light, among other claims. She is seeking damages, an injunction to stop her father from using her “FENTY” trademark to sell or promote any goods or services, and a declaratory judgment.

Known worldwide as a pop music star and beauty icon, Rihanna is also a prosperous businesswoman.  According to the complaint, she has been using her surname professionally and in connection with her brand and business ventures since at least August 2012. Through her company, Roraj Trade, LLC, she owns U.S. trademark registrations for a series of marks containing her surname, including “FENTY BEAUTY”, “FENTY BEAUTY BY RIHANNA”, and “FENTY GLOW”. She also owns trademark registrations in multiple foreign jurisdictions for the marks: “FENTY BEAUTY”, “FENTY BY RIHANNA”, FENTY”, and “FENTY FRAGRANCE”. Rihanna’s trademarks cover a number of products, including makeup, fragrances, and sneakers. “FENTY BEAUTY” has become one of Rihanna’s most popular brands, standing out at the forefront of popular cosmetics retailer Sephora, and being named one of Time Magazine’s 2017 “Inventions of the Year.

In 2017, Mr. Fenty opened Fenty Entertainment LLC, described on its website as an entertainment company “cultivating new talent and developing TV and media platforms.” His company is registered as an LLC in California and is also described as a production company developing “motion pictures, live concerts, and record producing.” In sum, Mr. Fenty’s business brands itself as offering services in the entertainment industry – the same industry in which his daughter has become of the biggest stars. With Rihanna’s visible brand campaigns, such as “Fenty Beauty”, “Fenty x Savage”, “Fenty x Puma” – and now her father’s Fenty Entertainment LLC…use of the Fenty name seems to leave room for confusion.

Supporters of Mr. Fenty’s business might respond: “Well, it’s his last name, too.” But what rights does a party have to their own last name?

Can A Surname Be Trademarked?

It depends. U.S. federal trademark law doesn’t allow an applicant to register a surname that is “primarily merely a surname” on the Principal Register.  15 U.S.C. §1052(e)(4).  This means there is no protection on the Principal Register for a surname that generally has no meaning outside of being someone’s last name.

On the other hand, if a surname has secondary meaning, also known as “acquired distinctiveness,” it’s eligible for protection under federal trademark law. A trademark registration applicant must prove that consumers associate the surname with a brand rather than simply thinking of it as someone’s last name.  A quick example is fast-food chain McDonald’s. While “McDonald” is a surname, McDonald’s Corporation owns the registered mark “McDONALD’s” in connection with restaurant services because the word “McDonald’s” has acquired a secondary meaning as a fast food restaurant with the golden arches.

Similarly, in Rihanna’s complaint, she argues that the “FENTY” mark, is “inextricably intertwined” with her professional persona, reputation, and businesses.  She argued that her “FENTY” mark has secondary meaning because relevant consumers understand the association with Rihanna when they see the mark “FENTY”.

It’s important to note that Rihanna owns the “FENTY” trademark in connection with beauty, makeup, and fashion products.  However, her complaint does not raise a trademark infringement claim, perhaps because Mr. Fenty filed a trademark application to register “FENTY” in connection with resort hotel services, not beauty products. His trademark application is still under review by the U.S. Patent and Trademark Office, which issued an initial refusal to register “FENTY”, alleging that it is primarily merely a surname when viewed in connection with hotel resort services (and citing 677 public records of individuals with the surname Fenty on the LEXISNEXIS® surname database).

Rihanna’s complaint brought claims of false designation of origin, suing her father for allegedly using their last name (her trademark) in his business to mislead consumers to think she is associated with his company.  Rihanna argues that the strong recognition of her “FENTY” trademark combined with her father’s choice to name his business Fenty Entertainment, and Rihanna’s overall influence in the entertainment industry confuses consumers into thinking Fenty Entertainment is associated with Rihanna, Roraj, and her Fenty Beauty product line.

Agency Law

The complaint also raises principles of agency law – it alleges that Mr. Fenty misrepresented the company as having authority to submit offers and enter into contracts on behalf of Rihanna. One notable allegation is that Fenty Entertainment engaged in conduct to book Rihanna for a series of Latin American concerts.

The complaint further alleges that until just about four months ago – October 2018, a press release on Fenty Entertainment’s website read “Ronald Fenty, father of superstar recording artist Rihanna, today announced the launch of Fenty Entertainment with his daughter Robyn ‘Rihanna’ Fenty”, implying an allegedly false affiliation with Rihanna.  According to the complaint, Fenty’s social media accounts stated that the company was affiliated with Rihanna until as recently as November 2018.

The complaint claims that while Mr. Fenty is Rihanna’s father, “he does not, and has never had, authority to act on Rihanna’s behalf.”

Even though Rihanna is a superstar entertainer, her “FENTY” trademarks largely protect her services in beauty, fashion, and fragrances. What does this mean for her father’s business as it relates to the entertainment industry?

The U.S. District Court for the Central District of California will decide.

Image from 123RF Limited

The drama is building in the comic clash between TBS late-night talk show host Conan O’Brien and comedy writer Alex Kaseberg over jokes Kaseberg claims O’Brien and his writing team stole from him.  As previously reported, O’Brien was able to knock out two of the five jokes in question on summary judgment on the grounds that they were independently created and/or too different for a reasonable juror to conclude they were copied, but three of Kaseberg’s jokes remain standing.  A jury trial is scheduled to begin this May.

In the trial brief O’Brien filed last month, O’Brien raises a funny bone of contention: are Kaseberg’s jokes even original enough to warrant copyright protection at all?  The brief asserts that “Kaseberg’s jokes are negligible and trivial variations on unprotectable ideas, preexisting works, or public domain works, such that they do not contain the requisite amount of creative input to qualify for copyright protection.”

Kaseberg’s jokes, like many jokes, pertain to news stories and current events.  The three jokes in question consist of a gag about New England Patriots’ quarterback Tom Brady giving Seattle Seahawks coach Pete Carroll the new truck Brady promised to award the MVP of Super Bowl XLIX, a jeer about a hypothetical street named after Bruce Jenner (i.e., “cul-de-sacless”), and a discovery that the Washington Monument is ten inches shorter than previously thought because of “shrinkage” resulting from cold weather.  Only the expressions of these humorous ideas, not the ideas themselves, are copyrightable.  And, as O’Brien’s brief notes, expressions that are “standard, stock, or common to a particular subject matter are not protectable under copyright law.”  However, Kaseberg’s brief stresses the low standard of originality the Copyright Act requires and contends all that is needed is “some creative spark, no matter how crude, humble or otherwise.”

In the event the jury finds Kaseberg’s jokes “original” enough to be copyrightable, Kaseberg will still have to demonstrate O’Brien’s jokes were “virtually identical” to Kaseberg’s – a much higher standard than the typical “substantial similarity” test.  Since Kaseberg’s jokes contain inherent newsworthiness, the Court found they could only receive thin copyright protection which requires the copying to be nearly verbatim to be actionable.

O’Brien argues Kaseberg falls well short of this standard, claiming the jokes are “worded differently, convey different actions, contain different levels of information, and involve different perspectives.”  O’Brien also claims differences in structure and delivery (O’Brien entertaining a live audience and Kaseberg writing his jokes in print) defeat Kaseberg’s claim.

Specifically, the differences in the Superbowl joke O’Brien identifies include the fact that O’Brien’s punchline (“So, Brady is giving his truck to Seahawks coach Pete Carroll”) was delivered in a neutral and sarcastic tone whereas Kaseberg’s punchline (“So enjoy that truck, Pete Carroll”) was more caustic and directed to Carroll.

With respect to the Washington Monument joke, O’Brien cites the fact that Jimmy Fallon tweeted the joke the day before Kaseberg published it, suggesting the joke is not original to Kaseberg.  O’Brien also pointed out that his punchline stating the monument, itself, was blaming the “shrinkage” on cold weather vs. Kaseberg’s jest “You know the winter has been cold when a monument suffers from shrinkage” distinguishes the jokes in that O’Brien sarcastically implies other factors shrunk the monument while Kaseberg solely attributes the weather to the shrinkage.  Finally, with respect to the Jenner joke, O’Brien claims the difference in punchlines “Cul-de-Sackless” vs. “Cul-De-No-Sac” is significant, as well as the fact that O’Brien’s joke was directed to the residents of the street whereas Kaseberg’s jeer was not.

Kaseberg’s brief acknowledges the Court’s finding that the jokes must be “virtually identical” to be actionable, but claims that this standard is met – especially in light of Kaseberg’s allegations that O’Brien told these jokes on his show the same night after Kaseberg posted them.  A funny coincidence?  Kaseberg thinks not.

It remains to be seen who will have the last laugh in this dispute, but with trial briefs submitted and less than four months before showtime, it appears this case will reach a grand finale.

The TVEyes v. Fox saga has reached its conclusion. Following the Supreme Court’s denial of TVEyes’ petition for certiorari, the video clipping service had little choice but to settle Fox News’s copyright infringement lawsuit. The parties filed a permanent injunction in the Southern District of New York under which TVEyes agreed to eliminate all Fox News content from its database. This injunction is a final settlement and protects TVEyes from having to defend a claim for damages and attorneys’ fees.

TVEyes is a subscription service that records virtually everything on TV. By syncing the video with closed captioning data, it’s able to make this library searchable by keyword. Subscribers can retrieve 10-minute clips around the keyword. Users include news organizations, the White House, members of Congress and the military. Fox News brought a copyright infringement suit against TVEyes in the Southern District, which TVEyes defended successfully on fair use grounds. The Second Circuit reversed the District Court, primarily on the ground that the clipping service deprived Fox News of licensing revenue that it would otherwise be able to realize.

This case attracted much attention, with free speech organizations such as Wikimedia and the Electronic Frontier Foundation arguing in support TVEyes’ position that its redistribution of clips is “transformative” and serves an important social role.

It remains to be seen whether other content owners will piggyback on Fox News’s success and demand that their content be removed from the site, or whether TVEyes will be able to develop a business model under which they pay for content.

Image from 123RF Limited

The California appellate court ruling which dismissed actress Olivia de Havilland’s suit against FX’s Feud will remain in place after the U.S. Supreme Court rejected de Havilland’s petition for review last week.

The now 102-year-old actress best known for roles in Gone With the Wind and The Adventures of Robin Hood, de Havilland alleged that FX’s depiction of her in the Emmy-award-winning docudrama Feud infringed her right of publicity and portrayed her in a false light.  Feud aired on FX in March of 2017 and was an eight-part miniseries that illustrated the intense rivalry between world famous actresses Bette Davis and Joan Crawford.  Olivia de Havilland, a close friend of Davis, was played by Catherine Zeta-Jones and her character appears for a total of 17 minutes across the entire season.

Specifically, de Havilland’s right of publicity claims hinged on her contention that she did not give FX permission to use her name, identity, or image.  Further, de Havilland complained that the depiction of her giving a fake interview on the red carpet, accusing Frank Sinatra of drinking all the alcohol in a green room for a production, and calling her sister, Joan Fontaine a “bitch” in an interview (de Havilland had actually called her a “dragon lady”) portrayed her in a false light.

FX claimed de Havilland’s suit amounted to nothing more than an ill-fated attempt to silence protected speech and filed an anti-SLAPP motion which was denied.[1]  The trial court reasoned that de Havilland’s right of publicity claims held merit based on declarations by purported entertainment industry experts claiming it is customary in the industry to obtain an appearance release from all individuals depicted in a work.  Moreover, the trial court held that FX’s portrayal of de Havilland was not “transformative” because its producers were attempting to portray her “as real as possible.”  The trial court also found that a jury could find that de Havilland was portrayed in a false light as a “gossip who uses vulgar terms about other individuals.”

FX’s appeal ultimately set the stage for a decision that vindicates the First Amendment and benefits all filmmakers and writers.  In her opinion for the Court, Associate Justice of the Second District Court of Appeal Anne H. Egerton recognized that books, films, plays, and television shows often portray real people and that these people, regardless of their fame, do not “own history.”  Accordingly, de Havilland “does… [not] have the legal right to control, dictate, approve, disapprove, or veto the creator’s portrayal of [her].”

The Court held that the First Amendment “safeguards the storytellers and artists who take the raw materials of life – including the stories of real individuals, ordinary or extraordinary – and transforms them into art, be it articles, books, movies, or plays.”  Further, the fact that some producers may obtain appearance releases or “life story rights” as a means of obtaining greater access to information about subjects and avoiding litigation does not mean that the First Amendment requires such agreements and, indeed, the Court held that such agreements are not required.  The Court noted that it might be a different story if de Havilland’s image was being used in a way that implied she sponsored or endorsed the work, but the Court reasoned that merely depicting de Havilland does not automatically indicate an endorsement.  Moreover, the Court found that her depiction was “transformative” because Feud told a complex story, the use of de Havilland’s identity was merely one of the raw materials from which the work was synthesized, and the work’s marketability and economic value derived from the creativity and skill of the creators and actors in Feud – not the depiction of de Havilland, which was only for 17 minutes of the 392-minute series.

With respect to de Havilland’s false light claim, the Court found it unpersuasive.  Specifically, the Court held that merely portraying de Havilland giving a fictitious interview would hardly subject her to “hatred, contempt, ridicule, or obloquy.”  To the contrary, the Court found that de Havilland was portrayed as a “wise, witty, sometimes playful woman” and Zeta-Jones’ portrayal of her was “overwhelmingly positive.”  Further, the series’ portrayal of de Havilland stating that Sinatra drank all the alcohol in a dressing room was not actionable because “Sinatra’s fondness for alcohol was well known” and a depiction of de Havilland saying this would not subject her to ridicule.  Finally, the Court found the fictitious “bitch” comment about de Havilland’s sister was not materially different from de Havilland’s actual reference to her sister as a “dragon lady.”

Of course, since de Havilland is a public figure, she had to demonstrate that Feud’s creators acted with actual malice when they made false statements about her.  De Havilland argued that actual malice was established by the producers’ concession that the red carpet interview, quip about Sinatra, and “bitch” comment never happened but, rather, were added for dramatic effect.  The Court was not convinced, holding that “fiction is by definition untrue.”  Thus, “[p]ublishing a fictitious work about a real person cannot mean the author, by virtue of writing fiction, has acted with actual malice.”  Rather, to prevail, a plaintiff must show that the defendant intended to convey a “defamatory impression.”  Here, the Court found that the producers intended to portray de Havilland as “a wise, respectful friend and counselor to Bette Davis, and a Hollywood icon with a unique perspective on the past,” and such a depiction was not grounds for a false light claim.

Although firmly defeated, de Havilland’s attorneys told the Los Angeles Daily Journal that “Miss de Havilland hopes she will live to see the day when justice is done.”  For filmmakers, producers, and writers, that day has already come.

[1] A “SLAPP” is a Strategic Lawsuit Against Public Participation.  Typically such an action is not filed because it holds merit, but rather to silence speech.  In response, California and numerous other states have passed “anti-SLAPP” statutes, which allows a defendant to file a special early motion to strike a SLAPP action and typically features the following procedural/substantive advantages: (1) a stay on discovery; (2) an expedited hearing of the anti-SLAPP motion; (3) an immediate appeal if the motion is denied; and (4) an award of attorneys’ fees to the party prevailing on the motion.

Just over a year ago, the U.S. Court of Appeals for the Federal Circuit held that a century-old ban prohibiting the United States Patent and Trademark Office (PTO) from registering “scandalous” and “immoral” trademarks violates the First Amendment.

Last week, the Supreme Court granted certiorari to determine whether they agree that the so-called “Scandalous Clause” is unconstitutional on its face.

The dispute began when the PTO denied trademark registration to Appellant Erik Brunetti’s clothing line – “FUCT.”  Citing Section 2(a) of the Lanham Act, the PTO argued that it was well within its rights to refuse to register a trademark that “[c]onsists of or comprises immoral, deceptive, or scandalous matter…”

Brunetti argued, in the first place, that his proposed trademark was not scandalous in the context of contemporary attitudes.  Further, and more notably, he argued that the Scandalous Clause constitutes a content-based restriction on his speech in violation of the First Amendment.

A restriction on speech is considered “content-based” when it “applies to particular speech because of the topic discussed or the idea or message expressed.”  Content-based statutes are presumptively invalid.  To survive, such statutes must withstand “strict scrutiny” review, which requires the government to prove that the restriction (1) furthers a compelling interest and (2) is narrowly tailored to achieve that interest.

Before the Federal Circuit, the government conceded that the Lanham Act’s “Scandalous Clause” is a content-based restriction, and did not contend that it survives strict scrutiny.  Rather, the government argued that the provision doesn’t really restrict speech at all: “Trademark rights are created not by federal law, but by use of a mark to identify goods and services in commerce,” wrote government lawyers in their petition for certiorari.  “Even without federal registration, respondent may use vulgar terms or symbols to identify his goods in commerce, and he may enforce his chosen mark in both state and federal courts against others whom he believes have misused it or have misappropriated any goodwill associated with it.”

Thus, the government explained, trademark registration should be viewed as a government subsidy for marks it wishes to promote rather than a restriction on marks that are excluded.  In that case, the bar on registering immoral or scandalous marks is simply a “reasonable exercise of the government’s spending power.”

This argument, however, may be a more difficult one to make in light of another recent Supreme Court decision on an analogous provision of the Lanham Act.

In 2017, the Supreme Court unanimously held that a provision of the Lanham Act which prohibited the government from registering trademarks that “disparage” others violated the First Amendment.  That case, Matal v. Tam, involved the members of an Asian American rock group (called The Slants) who were turned down by the trademark office when they tried to register their band’s name.  We blogged about that case here.  In Tam, the PTO refused to register “The Slants” as a trademark because they said the name was likely to denigrate a significant number of Asian Americans.  A unanimous Court found the “Disparagement Clause” to be facially invalid, underscoring that prohibiting the expression of an idea simply because “society finds the idea itself offensive or disagreeable” is antithetical to the bedrock principle underlying the First Amendment.

Further, the Court recognized that federal trademark registration confers significant benefits, and that refusal to register marks due to the Disparagement Clause was unconstitutional despite the fact that such marks could still be used. A plurality of justices (and all four who reached the issue) rejected the government’s argument that trademark registration should be viewed as a government subsidy.

Now, Brunetti argues that the “Scandalous Clause” should be similarly dispensed with.

In particular, he challenges the PTO’s history of apparently arbitrary decision-making when it comes to approving trademarks, arguing that this belies their claim that the Scandalous Clause is a content-neutral restriction.

For instance, he points out the office has registered trademarks for “FCUK,” “FWORD,”  and “WTF IS UP WITH MY LOVE LIFE?!”

If there is one thing both sides can agree on, it’s that this issue is ripe for review.  Though, in Tam, the Disparagement Clause was held facially invalid by a unanimous Court, several key issues, including the level of scrutiny that should be applied to similar provisions, were not agreed upon by a majority of the justices.

The Supreme Court will hear Iancu v. Brunetti this Spring.

 

 

 

 

Readers over 40 will remember the TV series MacGyver, which ran on ABC from 1985 through 1992. The show starred Richard Dean Anderson as a mild-mannered secret agent with an uncanny ability to escape the gravest perils by repurposing ordinary objects around him.  The show was such a hit that “macgyver” entered the lexicon to refer to an ingenious solution to a problem.

The original series was packaged by Major Talent Agency (“MTA”), which represented Henry Winkler and John Rich. Winkler and Rich, through their loanout companies, sold the show to Paramount under a 1984 agreement (“1984 Agreement”), which contained a specific provision according MTA a package commission on any series produced under the agreement and on “any spin-off series therefrom.” Paramount TV was acquired by Viacom in 1994, and when Viacom spun off CBS in 2006, the rights to MacGyver went with it.  In this franchise-crazed era, a revival of the program was inevitable; the new MacGyver premiered on CBS in the fall of 2016 and is now in its third season.  Citing the 1984 Agreement, MTA’s successors demanded their package commission from CBS, claiming that the new MacGyver constitutes a “spin-off series.” When CBS declined to pay, litigation ensued.

The case is deceptively simple. It turns on the meaning of the word “spin-off” as used in the 1984 Agreement. CBS’ publicity for the current series refers to it as a “reboot” or “remake.” Although neither of these terms appears in the 1984 Agreement, MTA’s successors assert that “[a]t the time of the 1984 Agreement, the term ‘spinoff,’ unless further defined, was broadly understood in the industry to mean a television series that is based on, comes out of or otherwise derives from an earlier television series, including what are referred to today as, among other things, ‘reboots,’ ‘revivals,’ ‘remakes,’ ‘sequels,’ and ‘spin-offs.'”

Conversely, CBS will argue that “remake” and “spinoff” refer to different things. A spinoff takes characters or settings from one work as the starting point for a different work. In contrast, a remake uses principal characters from the original work to animate a work similar to the original. These distinctions were well-known in 1984. At that time, A Star Is Born had already been remade twice. As for spinoffs, look no further than Happy Days, the show that made Henry Winkler’s career.  That series was itself a spinoff from a segment of Love, American Style and in turn was spun off to Laverne & Shirley and Mork & Mindy. By these definitions, the new MacGyver show is more fairly characterized as a remake than as a spinoff.  Of course, if the parties to the 1984 Agreement had intended to pay commissions to MTA for remakes as well as spinoffs, they could have said so.

There are, however, plausible theories that MTA’s successors could use to explain this omission. In 1984, remakes may not have been novel but were largely confined to theatrical motion pictures. The craze to recycle old TV series is a much more recent phenomenon. Further, the distinguishing characteristic of a remake is inherently fuzzy when applied to TV. A remake, by definition, substantially replicates the plot of its original, but every episode of a TV series is a new story, which begs the question of what exactly it is that is being remade. Under this logic, any reversioning of a series can be theoretically characterized as a spinoff, even one that involves substantially the same characters and setting. Viewed in this light, it is understandable why the parties to the 1984 Agreement might have used “spinoff” to refer to any new version of a series.

Sometimes, seemingly simple questions of contract interpretation can illuminate transformations in the entertainment industry over time. Similar conflicts arose over whether streaming revenues should be deemed “home video” receipts for purposes of calculating backend participations. Unlike those cases, the MacGyver case does not implicate deep technological changes, but it does reflect a programming trend that was perhaps not foreseen in 1984.