I attended and spoke at the 3rd Cloud Computing conference today, and here are a few points to take-home:

• Pay attention to governing law clauses (which law applies) and dispute resolution procedures (how do we resolve disputes), particularly for cloud service providers whose customers are worldwide;
• Limitations of liability in the context of the “public cloud” are critical. These clauses can be upheld if drafted clearly and carefully, but they will be struck down if they are unclear, or if there are overriding public policy reasons. 
• If you are a cloud-service user, and your use of cloud services involves the hosting of personal information (for example, information of your own end-customers), consider this: if one of those customers withdraws consent to the use of his or her personal information, do you have a protocol in place to track that withdrawal back through the cloud service provider, to the host who may be holding the data?

 

For a copy of my paper, please email me.

Calgary – 12:30 MDT

 

 

 You’re in good company. Even the late Steve Jobs had his complaints about this. In a biography of the Apple founder, Mr. Jobs complains that Android was “grand theft”, and he vowed to fight back. Is Android a rip-off of the iPhone? It certainly followed Apple.  The iPhone was launched in 2007, Android was launched in October, 2008. Apple introduced its App Store in July, 2008. Android Market came out a few months later. Even though it entered the marketplace later, by 2010, Android captured 44% of all mobile app downloads in Q2 2011, passing Apple’s 31% stake (see CNET report) The numbers are hard to crunch (remember, iOS is on multiple hardware devices made by one manufacturer, and Android sits on over 40 smartphones made by six manufacturers), and Apple’s system comes out on top by some measures, but by August 2011, some estimates put Android at a leading 48% of the smartphone market share.

So there is no doubt that Android has stormed from behind as a credible alternative to Apple’s ecosystem, but does that make it a “stolen idea”? Not from the perspective of intellectual property law, since there is no protection in the overall idea of a mobile platform that can run third-party apps. The real question is whether Google copied iOS code (there’s been no suggestion of that), used Apple’s trade-marks (nope), or infringed any of Apple’s patents (see this story for one of the many Apple vs. Android patent fights). 

In any event, there is a fine line between infringement and inspiration. Legend has it that Mr. Jobs was “inspired” by the mouse he originally saw at a Xerox research facility. Neither did Mr. Jobs invent the MP3 player or the idea of a mobile device running third-party apps. My Palm Treo was doing that years before the iPhone was launched.

Calgary – 07:00 MDT

 

A reminder: next week on November 1 & 2, 2011, the 3rd Cloud Computing Law conference will be held in Calgary, hosted by Federated Press. Richard Stobbe will be presenting on the topic of risk-allocation in cloud-based services such as iCloud and other enterprise cloud computing contracts, including warranties, indemnification and limitation of liability clauses.  

IT lawyers and in-house counsel from top companies will review:

• the risks & legal pitfalls of cloud computing
• legal and compliance issues 
• the implications of virtual storage on legal jurisdiction questions
• key issues that need to be addressed when negotiating and drafting a cloud computing agreement  

For registration details: Cloud Computing Law Conference (Calgary) 

Readers of ipblog.ca are eligible for a 15% discount – use this code when registering: CCL1111/PR 

Calgary – 07:00 MDT

 

Here are two recent U.S. software decisions to note. Both decisions strengthen the hand of software vendors:

1. In a follow-up to our earlier post (Software License Upheld), the Ninth Circuit Court of Appeals decision in Vernor v. Autodesk Inc. has been denied leave to appeal, meaning the US Supreme Court has elected not to review the decision. This case dealt with resales by Vernor of used copies of AutoCAD software. Vernor claimed the resales were permitted under the “first sale doctrine”. The decision stands for the proposition that a software license is an important exception to the “first sale” defence. This is because the court found that Autodesk had not sold copies but merely licensed copies of the copyrighted work. 
2. In another Ninth Circuit decision ( Apple Inc. v. Psystar Corp., 9th Cir. Cal. Sept. 28, 2011), a small computer reseller operated a business re-selling Mac OS X pre-installed into non-Apple computers.  Apple complained that this was an infringement of copyright and a breach of the Mac OS X license agreement. Specifically, Apple’s software license agreement requires Mac OS X users to run their copies only on Apple computers. Psystar raised the defence that this was restrictive and constituted “copyright misuse”. The court sided with Apple, pointing out that to demonstrate “copyright misuse”, the license agreement would have to restrict creativity or restrict competition. In this case, the Mac OS X license agreement did neither. Apple’s license does not restrict a competitor’s ability to develop its own software, nor does it prohibit customers from using non-Apple components with Apple computers. Instead, Apple’s license merely restricts the use of Apple’s own software to its own hardware.

Calgary – 07:00 MDT

 

In Louis Vuitton Malletier SA v. Akanoc Solutions, Inc., No. 10-15909 (9th Cir. Sept. 12, 2011) the US Ninth Circuit Court of Appeals found that “providing direct infringers with server space” qualifies as a material contribution for contributory copyright infringement of copyright. In Canada, we have the concept of a “authorizing infringement”, but generally, a person does not authorize infringement by authorizing the mere use of equipment (such as server space) that could be used to infringe copyright (according to the Supreme Court in the CCH case).  “Authorize” means to approve, permit and encourage the infringement. However, a court in Canada may find that copyright infringement is “authorized” in circumstances where there is something less than less than direct and positive approval and encouragement, for example, if there is some level of control over the infringing actions. This concept dates back to early cases  from the 1920s (Falcon’s case) and 1940s where “certain mechanical contrivances” (transcription turntables) were used to copy musical recordings, and became the subject of copyright infringement claims.

Calgary – 07:00 MDT   

 

Here’s an update to our earlier post (Copyright in Art … Part 2) about the case of photographer Patrick Cariou and appropriation artist Richard Prince. Earlier this year, a US District Court sided with Cariou in his copyright claim against Prince, based on Prince’s use of Cariou’s photographs of Rastafarians. The court dismissed the fair use defence since Prince’s copying was substantial compared with the “slight transformative value”. The New York Times reports that decision has now been granted an appeal (Court Allows Richard Prince to Appeal Copyright Decision) by the US Second Circuit Court of Appeals. The outcome will be closely watched by artists.

Calgary – 07:00 MDT

 

The Federal Tories have made it clear that they intend to re-introduce their copyright reform bill (the bill formerly known as Bill C-32) this fall, with new legislation possible by Christmas. They may want to re-think that timeline and ask Santa to wait on the shiny new copyright law. The Supreme Court of Canada is scheduled to weigh in on the subject, with a record five copyright cases scheduled in early December. While the issues in these five appeals will not span all of copyright law, the interpretation and analysis of copyright will undoubtedly impact the proposed legislation.

Calgary – 07:00 MDT

 

Save the date: On November 1 & 2, 2011, the 3rd Cloud Computing Law conference will be held in Calgary, hosted by Federated Press.

Richard Stobbe will be presenting on the topic of risk-allocation in cloud-based services such as iCloud and other enterprise cloud computing contracts, including warranties, indemnification and limitation of liability clauses.  

IT lawyers and in-house counsel from top companies will review:

• the risks & legal pitfalls of cloud computing
• legal and compliance issues 
• the implications of virtual storage on legal jurisdiction questions
• key issues that need to be addressed when negotiating and drafting a cloud computing agreement  

For registration details: Cloud Computing Law Conference (Calgary) 

Readers of ipblog.ca are eligible for a 15% discount – use this code when registering: CCL1111/PR

Calgary – 07:00 MDT

 

Are you a Canadian app-developer? One of the most common concerns I hear from my app-developer clients is this: how do you comply with laws around the world when your app is published on the App Store? Not an easy question to answer as these stories show. Here are a few updates from the wonderful world of app-related disputes and litigation:

• This story notes the importance of reviewing app-related privacy issues: a recent US Federal Trade Commission (FTC) settlement with app-developer W3 Innovations shows that the FTC will be scrutinizing the mobile app market for privacy violations, particularly violation of children’s privacy.  In the US, the Children’s Online Privacy Protection Act (COPPA) is specific privacy legislation that does not have an equivalent in Canada.
• The Lodsys patent infringement attack against iOS app developers has expanded to target Android developers and (reportedly at least one) BlackBerry app developer (updates here), as well as established game developers, including EA and Atari. Apple has sought to intervene in the case, to argue that their license agreement with Lodsys should shield iOS developers from patent infringement. Google may feel compelled to go to bat for Android developers. Which means Lodsys is locking horns with Apple, Google, RIM and EA.  

Related Reading: When an iPhone App Infringes a Patent 

Calgary – 07:00 MDT

Check out this interesting summary of Art Law concepts: Art Law TV, a series of videos which explores copyright and other legal issues faced by artists, presented through the lens of artistic practice.

Calgary – 07:00

 

In a new series, we review the basics of Canadian trade-mark, copyright and patent law.

• Canadian Copyright: The Canadian Copyright Act gives authors the right to control their creative works, such as books and pictures. Under copyright law, the concept of “author” is understood broadly and includes software programmers, photographers, musicians, mobile-app developers, animators, graphic designers, artists, dancers, writers, cinematographers, painters and poets. Original creative works are protected automatically under the Copyright Act, which gives authors the right to make copies for the term of copyright. Copyright generally lasts for 50 years after the death of the author.  It is an infringement of copyright to makes unauthorized copies of a work that is protected by copyright. One important point to remember is that copyright law does not protect ideas or concepts, but protects the expression of the idea – as expressed in written or fixed form, such as a book, a sound recording, a photo or a painting.
• Best Practices:
• Notation - A standard copyright notation is “© ABC Company Inc. 2011, all rights reserved.” A notation of this type is not required by the Copyright Act but it is recommended on copyright protected works.
• Register Copyright – Registration is relatively easy and inexpensive, and provides the owner with proof of ownership of copyright . In Canada, you are not required to submit a copy of the work with your application for registration.
• Public Domain – Just because something is publicly available on the internet does not mean that it’s in the “public domain” for copyright purposes. The concept of “public domain” refers to the expiry of copyright protection. So, for example, the original works of Shakespeare or an 18th century painting can be said to be in the public domain since the term of copyright has lapsed.
• Copyright in Software: Software, even open source software, is subject to copyright. The owner of the software could be the author of the code, or a company employing the author. To protect the intellectual property rights in software of any kind – whether it’s sold on a disc at the retail level, or is downloadable, whether an operating system or a mobile app - the owner should use proper copyright notations and implement a well-drafted license agreement. An end-user software license is a contract between the owner and the user that deals with topics such as ownership, use restrictions, warranties, liability, tech support, and related terms.
• Copyright Outside Canada: Under the Copyright Act and international copyright conventions, Canadians enjoy copyright protection in countries who are parties to treaties such as the Berne Convention, Universal Copyright Convention and the Rome Convention. Even with this legal framework in place, enforcement of copyright is challenging in the context of the internet, since infringement can occur easily and anonymously in multiple jurisdictions on multiple servers. Specialized assistance is usually required in combatting copyright infringement outside Canada.  

For more information and assistance with your copyright and software licensing needs, visit Field’s Intellectual Property & Technology Group. 

Calgary – 07:00 MDT

 

If the health of an industry is measured by the litigation it spawns, then the app and gaming economy is going strong:

• Copyright: Fantasy Flight Publishing has sued a European app-developer, Puffin Software, for alleged infringement of copyright in a medieval-themed game (Fantasy Flight Publishing, Inc. v. Puffin Software et al. U.S. District Court, District of Minnesota Case No. 11-cv-01928, Filed July 15, 2011). Fantasy Flight claims that Puffin’s iPad title “Viking Lords” is an infringement of copyright in the board game BattleLore owned by Fantasy Flight. In the claim, Puffin allegedly approached Fantasy Flight to pitch an iPad version of BattleLore, and when there was no uptake, Puffin decided to go ahead and publish the game under its own title.  The case will involve an analysis of the elements of each game, and a breakdown of functional and original elements, as in the Sony case (below).
• Patent: App-developer Zynga has been sued in Segan LLC v. Zyna Inc. for alleged infringement of Segan’s U.S. Patent No. 7,054,928, which was issued for a system for accessing “enhancement content” on the internet. The claim alleges that Zynga titles such as FarmVille, PetVille, and FrontierVille infringe the patent.
• Copyright: In Dath v. Sony Computer Entertainment America Inc., the US Ninth Circuit Court of Appeals upheld the lower-court decision in a copyright infringement case involving the Sony PS2 and PSP title “God of War”. The plaintiffs alleged that Sony infringed copyright in their written works about war between Sparta and Athens. The plaintiffs could not show actual copying, so they had to rely on the US concept of access and substantial similarity. Remember, copyright does not protect ideas, but merely the form and expression of ideas. In this case, there was no substantial similarity of expression of ideas. In this analysis, the court reviewed elements of expression such as plot, themes, dialogue, mood, settings and characters, and concluded that the works were not similar and no infringement occurred. 

Calgary – 07:00 MDT

 

In a recent US decision (Murphy v. Millenium Radio, 2011 WL 2315128 (June 14, 2011)), the Third Circuit Court of Appeals decided that removing the name of a photographer from a photo constitutes a violation of the DMCA. In this case, a photographer took pictures of two local radio personalities for publication in a magazine. The photo was later scanned and uploaded by the radio station, but in the scanning process, the photographer’s name was cropped out, without the artist’s authorization. The court found that this breached § 1202 of the DMCA which deals with “Integrity of copyright management information”.

In Canada, this would be covered by Section 14.1 of the Copyright Act, which addresses “moral rights”. Under this heading, an author or creator of a work has the right to be associated with the work as its author by name, or under a pseudonym, or the right to remain anonymous. Tampering with the right of a photographer to be associated with the work would infringe moral rights in Canada.

Calgary – 07:00 MDT

 

In Louis Vuitton Malletier S.A. et al. and Singga Enterprises (Canada) Inc., the Federal Court sent a strong message to counterfeiters. This is a case of infringement of copyright and trade-mark rights, arising from the sale of counterfeit copies of Louis Vuitton and Burberry handbags through online sales and operations in Vancouver, Calgary and Edmonton. The Trade-marks Act provides for an award of damages or profits in relation to the sale of infringing goods. The Copyright Act provides for an award of both damages and profits from the sale of infringing goods, or statutory damages between $500 to $20,000 per infringed work. In this case, the Federal Court awarded Louis Vuitton and Burberry a total of over $2.4 million in damages against the defendants, catching both the corporate and personal defendants in the award.  

Related Reading: Retail Therapy for Brand Owners: Counterfeit Goods & Director Liability 

Calgary – 07:00 MDT

 

 

Apple Inc. has a well-known family of iMarks registered in Canada, the US and around the world, including iTunes, iMac, iPhone, iPod and iPad. In Canada, it has even applied to register the iPad screen as a trade-mark under Application No. 1488599 (the IPAD TRADE DRESS ICON SCREEN Design) as well as the iPhone graphic (shown at right), under Application No. 1481515.

• The latest addition to the family is the iCloud mark. In the US, a company called iCloud Communications has sued Apple for alleged trade-mark infringement in the US District Court in Arizona. (See a copy of the Complaint Here). iCloud Communications claims use since 2005, though it does not have any registered marks. Prior to launching its new iCloud service, Apple bought the domain name icloud.com from Xcerion AB, a Swedish cloud-computing company, and there’s a pretty good bet that Apple has also acquired Xcerion’s registered US mark for ICLOUD which claims a priority date of November 29, 2007, for use with information management software.  Though the registration is still in the name of Xcerion, an Apple inhouse lawyer is named as the attorney of record. This strategic acquisition would allow Apple to rely on the earlier use claimed by this mark.
• In a recent Canadian case, Apple was the earlier user – in this case, it used its family of registered iTunes marks to oppose the application for the mark TUNECARDZ by Digi Media Cardz Inc., a BC company, for use with collectible cards allowing the card owner to download music. In the decision released by the Trade-marks Opposition Board (TMOB) (Apple Inc. v Digi Media Cardz Inc., 2011 TMOB 72 ), Apple prevailed by showing confusion between TUNECARDZ and its registered Canadian marks ITUNES and ITUNES MUSIC CARD for music downloads.

Apple has a long history of fighting strategic trade-mark battles, including for its core brand APPLE, starting in 1978, against Apple Records), against Cisco for its now-iconic iPhone trade-mark , and against Fujitsu, for the iPad trade-mark. Lessons for business? In many of these cases, the mark was already owned by someone else when Apple decided it was going to be an Apple brand.  This history is, in many ways, a reflection of the company’s approach to business: they did not invent tablet computing, smartphones, online music sales or the MP3 player. They simply stepped in, elbowed the early movers aside, and took over the top position. 

Calgary – 07:00 MT

 

Artists mash-up images, text and audio all the time and have been doing so for many years. When is “appropriation” considered “transformative”?  If you use someone else’s image to create something, is the new work simply a copy of the original image, or is it transformed into a new original work of art? 

If it’s just a slavish copy, then you need consent of the owner of the original image. Without that consent, you might be infringing copyright.  If it’s transformative, then is the appropriation forgiven since it results in something new and original?

Consider the case of photographer Patrick Cariou and appropriation artist Richard Prince. Earlier this year, a US District Court sided with Cariou in his copyright claim against Prince, based on Prince’s use of Cariou’s photographs of Rastafarians. The court was clear that the scope of Prince’s copying was substantial compared with the “slight transformative value”. In other words, there was a whole lot of appropriation and not much transformation. As a result, the fair use defence didn’t hold up.

The next question is the obvious one: where is the line between the two?  Andy Warhol made a career out of appropriation. His works - which borrowed everything from Campbell’s soup cans to press photos of Jackie Kennedy - were the subject of numerous complaints and lawsuits, all of which reportedly settled out of court. Artist Jeff Koons has also made a successful career out of transformative works, though he has often fallen on the wrong side of court decisions. In the 2006 US Court of Appeals decision in Blanch v. Koons, Koons successfully raised a “fair use” defence. This claim arose from the use of an image of the plaintiff’s copyright-protected photograph in a Koons collage painting entitled “Easyfun-Ethereal”. The court considered this use to be highly transformative, where the original image was used as “raw material” for a completely different type of work.

Calgary – 07:00 MT

 

Last week the US Supreme Court (SCOTUS) released its decision in the long-running patent infringement case between i4i, a Canadian software company, and Microsoft. (We’ve been following the case here). Microsoft has now run out of legal options. At trial, the jury found that Microsoft willfully infringed i4i’s software patent and that Microsoft failed to prove invalidity of the patent.  Microsoft appealed the original trial decision. That appeal was dismissed. Microsoft filed another appeal for a en banc re-hearing. That appeal was dismissed. Microsoft challenged the validity of the i4i patent. The patent was upheld, and the USPTO denied Microsoft’s second application for a re-examination. Microsoft appealed up to the SCOTUS and that appeal has now been dismissed (see the full decision here). In the US, the Patent Act is clear that a patent is presumed to be valid and in order to establish invalidity, the party who is challenging the patent must present “clear and convincing evidence”. Microsoft failed to provide such evidence and the original infringement decision stands.

One of the interesting elements of the case was Microsoft’s allegation that i4i had previously sold software (known as S4) which embodied the patented invention. If true, this would have impacted the validity of the patent that Microsoft had infringed. The S4 source code had been destroyed years before the patent infringement litigation, so evidence came from S4’s two inventors, both of whom testified that the S4 software did not embody the invention claimed in the infringed patent.  Microsoft now has to face the $290 million damage award and permanent injunction that bars the sales of certain versions of Microsoft Word.

Calgary – 07:00 MT 

 

Our update on Canadian copyright law now should be updated, as the Tory majority government is set to take the reins of power in Parliament.  The Conservatives made it clear in their campaign that they would, if given a majority, reintroduce and pass the bill formerly known as Bill C-32, An Act to amend the Copyright Act  (which will have a new number in the next Parliament). The bill’s digital-lock provisions remain contentious, and it is unclear how this will be addressed or amended, if at all, by the Harper government.  Parliament will resume June 2.  The traditional summer recess also usually starts in June.  So Parliament will not likely get much done before September.

On a related note, leave to appeal was granted by the Supreme Court of Canada in the case of Province of Alberta as represented by the Minister of Education, et al. v. Canadian Copyright Licensing Agency operating as “Access Copyright” (SCC #33888 – appeal from the Federal Court of Appeal; link to decision: 2010 FCA 198) This case deals with non-infringing use of copyrighted material for the purposes of “fair dealing“. This means the SCC will hear two “fair dealing” cases this term: the decision in SOCAN v. Bell Canada is also on the court’s docket; that case deals with the interpretation of the word “research” and whether 30-second song previews qualify as “fair dealing“.
Calgary – 07:00 MDT

 

When a popular iPad app aggregates news articles and re-packages them for reading on the iPad, is it copyright infringement?

The Washington Post and a dozen other media companies would say yes.  Zite, the Canadian app developer, argues the content is aggregated in much the same way that Google and other search engines crawl and index web content. Is there a difference between the two?  This is reminiscent of the early days of internet copyright disputes (in 1997), when the Washington Post and other media companies sued Total News Inc. for aggregating and framing news articles on the Total News webpage. The Washington Post had the same complaint as they now have with the Zite app: namely, that ads are removed or obstructed in the process, and the media company’s ad revenue is threatened. 

Other US lawsuits have established that certain types of framing, such as the reproduction of thumbnail images, can be excused as “fair use”. Google successfully raised this defence in the US decision in Perfect 10, Inc. v. Amazon.com, Inc. [PDF] based on the “transformative” nature of the copying. 

Calgary – 07:00 MDT

 

In recent privacy decision from the Ontario Court of Appeal (R. v. Cole, 2011 ONCA 218), the court recognized a core right to privacy of personal information which extends into the workplace – in this case, an employer’s laptop that was used by the employee in the course of employment.  The question was whether the employee had a “reasonable expectation of privacy” in the contents of the laptop. The court decided that the circumstances of this case, the employee did enjoy privacy in the contents of the laptop.

 Calgary – 07:00 MDT