The Literacy Lab v. FastBridge Learning LLC et al. (17-cv-12231).

The Literacy Lab (“TLL”), a nonprofit organization that provides literacy services to low income students, filed a declaratory judgment action, seeking a declaration that it is not infringing copyright in Fastbridge’s earlyReading and CMBreading assessments. TLL had previously been served a subpoena in a Minnesota suit brought by the defendants against a nonprofit partner of TLL who provided TLL with the Reading Corps program and model that is accused in the Minnesota suit, creating declaratory judgment jurisdiction.  TLL asserts that the reading assessment tools are not protectable under copyright law because any such copyright would encompass the underlying ideas rather than the form of expression and under the merger doctrine.

WB Music Corp. et al. v. Quality Restaurants, Inc. et al. (17-cv-30163).

Continuing the ASCAP theme, WB Music Corp., Milksongs, and Hunglikeyora Music filed suit against the owners and operators of Louie’s Lakehouse of Southwick Massachusetts, alleging infringement of the songs “Shut Up And Dance,” “And So I Know,” and “Drive” by allowing them to be performed in the restaurant on July 16, 2017. According to the complaint, ASCAP representatives tried on over sixty occasions since 2008 to contact the defendants to offer an ASCAP license, all of which were refused.  This is one of six ASCAP-styled suits naming at least one of the same plaintiffs that were filed yesterday in Illinois, Louisiana Maryland, and Wisconsin as well as Massachusetts.

I would note that the performances of the Hendrix songs just referenced took place on July 14, 2017, and that the road from Southwick, located just west of Springfield, MA to Marlborough, home of the Bolton Street Pub, leads directly towards Boston – perhaps more such suits will arise in the coming days based on what appears to be a road trip taken by an ASCAP representative to explore unlicensed performance spots.

Experience Hendrix, LLC v. 587 Bolton St., Inc. et al. (17-cv-12197).

Experience Hendrix, which (according to its website) is owned and operated by members of Jimi Hendrix’s family, sued the owners and operators of the Bolton Street Pub of Marlborough, MA for allowing several copyrighted Jimi Hendrix’s songs to be performed without license. The Bolton Street Pub appears to offer entertainment most weekend nights in the form of cover bands.  Experience Hendrix asserts that it is a member of ASCAP, an association that licenses performance rights to members’ copyrighted musical compositions, and that despite repeated requests, the Bolton Street pub have refused ASCAP’s license overtures.  Experience Hendrix seeks an injunction preventing the Bolton Street Pub from publicly performing, causing, or permitting to be performed three particular Jimi Hendrix songs – “Fire,” “Purple Haze,” and “Stone Free” – and seeks statutory damages and attorneys’ fees.

Atlantis Services, Inc. v. Asigra, Inc. (16-cv-10864).

Asigra hired Atlantis to develop and provide software to Asigra, a project that was initially expected to take about a year. After agreeing to the terms for this work, Asigra sought to accelerate the completion of the project.  Asigra indicated that it could only do so by incorporating code from Atlantis’ own appliance product.  The parties orally agreed to Asigra receiving a limited right to use this code, with the parties disputing the consideration due Atlantis for this right.  After completion of the project, when a dispute arose over payment, Atlantis “unilaterally revoked the nonexclusive license” and sued Asigra for breach of contract, trade secret misappropriation, and copyright infringement, among other things.  Asigra moved for judgment on the pleadings on all counts.  Judge Hennessy granted Asigra’s motion with respect to the copyright claims, while denying it with respect to the other claims.  He determined that Atlantis had granted a nonexclusive license to the code by the parties’ oral agreement, which became irrevocable upon the payment of consideration by Asigra.  The reasoning is that, upon payment of consideration (regardless of whether it was complete consideration under the agreement) a contract has been formed, and the remedy for the aggrieved party is through contract law, not copyright.

Also of interest, Judge Hennessy determined that Asigra waived its argument that the allegedly misappropriated trade secrets were not adequately identified by raising it only in a footnote; First Circuit case law holds that arguments raised perfunctorily or solely by footnote are waived. He also denied judgment on the pleadings with respect to Asigra’s Ch. 93A claim, finding that one party’s breach of contract for the purpose of gaining leverage over the non-breaching party has been deemed an unfair business practice in Massachusetts.

Microsoft Corp. v. Teratech Corp. d/b/a Terason et al. (17-cv-12038).

Microsoft sued Terason and its president, Alice Chiang, for copyright and trademark infringement, false designation of origin, and unfair competition related to allegedly pirated versions of Microsoft software being advertised and distributed by Terason. Microsoft alleges that Terason customers purchase the software without being aware that it is not legally licensed by Microsoft.  Terason manufactures color portable ultrasound equipment, and (according to the complaint) thousands of activations and attempted activations of Windows 10 and Windows 7 software occurred over the past six years from an IP address assigned to Terason.  The product keys for these activations were either used more times than authorized by the applicable license or were used to activate software outside of the region for which they were authorized.  Microsoft alleges that Chiang personally participated in or had the right to direct and control these activities and received a direct financial benefit from these activities, justifying personal liability either directly or under principles of secondary liability such as respondeat superior, vicarious liability and contributory infringement. The case is before Judge Gorton.

Small Justice LLC v. Xcentric Ventures, LLC (1st Cir. Oct. 11, 2017).

Plaintiffs Richard Goren, a Massachusetts attorney, his company Small Justice LLC, and Christian DuPont had sued defendants Xcentric Ventures, LLC and Ripoff Report.com for copyright infringement, libel, interference with a contract, and violation of Massachusetts’ unfair competition statute. Goren had represented DuPont in an unrelated matter; DuPont had subsequently authored two reports critical of Goren and posted them to Ripoff Report, a “consumer protection” website owned by Xcentric that allows users to post complaints about companies or individuals.  As part of the posting process, the user grants Ripoff Report an irrevocable exclusive license to the copyright, and further warns users that, once posted, the post will not be taken down even at the request of the poster.  When DuPont failed to appear in the libel suit that resulted, Goren was granted an injunction prohibiting DuPont from publishing the reports, and was awarded ownership of the copyright of the reports. He then filed the suit that is the subject of this appeal, seeking the enjoin Ripoff Report from continuing to post the complaints and to require them to take all actions necessary to have cached versions and links removed from Bing, Google, and Yahoo.

Xcentric moved to dismiss the complaint, which Judge Casper granted in part. Specifically, Judge Casper dismissed the libel, tortious interference, and parts of the unfair competition counts as blocked by the Communications Decency Act, 47 U.S.C. § 230, which shields interactive computer service providers from liability for information provided by another content provider.  The court rejected Goren’s argument that, by holding itself out as the copyright holder and by having “directed” internet search engines to list the postings, Ripoff Report itself became the information provider.  Following discovery, Judge Casper granted Xcentric summary judgment on the remaining copyright and Ch. 93A claims, finding the “browsewrap” license conclusive on the copyright claims.  Judge Casper modified the judgment to find that the browsewrap license failed to meet the requirements of transferring an exclusive copyright license, and that only an irrevocable non-exclusive license had been granted; this distinction did not, however, change the outcome.  Finally, Judge Casper awarded $124,000 in fees and costs to Xcentric pursuant to 17 U.S.C. § 505.

The First Circuit Court of Appeals reviewed the dismissal of the libel and tortious interference claims de novo and affirmed.  The § 230 immunity is to be liberally construed, to prevent deterrence of on-line speech; so construed, Xcentric could not be considered to be “responsible … for the creation” of the information, and immunity would apply.  Continuing to apply de novo review, the Court affirmed the copyright decision, rejecting Goren’s argument that the license “contract” failed because no consideration was given to DuPont – while consideration is necessary to support an irrevocable license, actually posting the complaints was sufficient consideration under the circumstances.  Notably, the Court determined that it need not decide whether a browsewrap agreement can satisfy the exclusive license writing requirement of 17 U.S.C. § 204, leaving this issue open in the First Circuit.

The Court reviewed the fee award for abuse of discretion. After quickly dismissing Goren’s contentions that Xcentric was not a prevailing party or that its fee motion was untimely, the Court looked to the Supreme Court’s Fogerty factors in analyzing the decision to award fees – “frivolousness, motivation, objective unreasonableness [both factual and legal] and the need in the particular circumstances to advance considerations of compensation and deterrence.”  Characterizing review of the application of these factors as “extremely deferential,”

The Court found no fault with Judge Casper’s characterization of the legal and factual basis for plaintiffs’ claims as “at best questionable,” with its noting that Xcentric fought the case for more than two years without the prospect of a damage award, or with its determination that Xcentric prevailed on all counts. Finally, the Court noted that a showing of bad faith on the plaintiffs’ part is not a requirement for a fee award pursuant to the statute.  The fee award was thus affirmed as well.

Philpot v. Kinder et al. (17-cv-11991).

Larry Philpot, a professional concert and event photographer from Indiana, sued Encore Unlimited, Inc., Printed Guitar Picks Limited, and numerous individuals for copyright infringement. Philpot alleges the defendants uploaded photographs he had taken of Carlos Santana, Neil Young, and Kid Rock, printing them on guitar picks, and advertising and selling them through their own websites as well as on Ebay.  He seeks liability for reproduction and public display, as well as for unfair and deceptive trade practices under M.G.L. Ch. 93A.  Philpot further alleges that the copyright infringement was willful, based (solely, it appears) on his allegation that the defendants tried to hide their identities by registering their domains under aliases.  A review of one of the defendant’s websites (www.printedguitarpicks.com) reveals that the company allows customers to upload pictures to be printed on guitar picks, while also offering stock pictures of various artists; it is unclear from the complaint whether the former or the latter are the subject of the suit.  For the latter, the website indicates that all customers submitting photographs warrant that they obtained permission from the copyright holder; it will be interesting to see whether this clause affects the willfulness decision.