How Do You Apportion an Infringer's Profits?

Tell It To The Hand. Today’s inspirational quotes by Learned Hand:

“We may win when we lose, if we have done what we can; for by so doing we have made real at least some part of that finished product in whose fabrication we are most concerned: ourselves.”

“To be pulled in many opposite ways at once results negatively, but it is not the same thing as to feel no impulse at all. An ass between two bales of hay is said to have died of starvation, but not from indifference.”

“[L]life is made up of a series of judgments on insufficient data, and if we waited to run down all our doubts, it would flow past us.”

“The spirit of liberty is the spirit which is not too sure that it is right; the spirit of liberty is the spirit which seeks to understand the minds of other men and women; the spirit of liberty is the spirit which weighs their interests alongside its own without bias; the spirit of liberty remembers that not even a sparrow falls to earth unheeded”

The last quote comes from a 1944 address given to a small crowd in Central Park. The speech was reprinted in Life, Reader’s Digest, The New Yorker and many newspapers. It struck a tone of tolerance that reverberated around the country and brought Hand unexpected attention and celebrity from the non-legal world.

Edward B. Marks Music Corp. v. Jerry Vogel Music 1 and Edward B. Marks Music Corp. v. Jerry Vogel Music 2. In 1907, the Edison Company released a performance of The Bird on Nellie's Hat. It was co-authored by Edward B. Marks and written in the 1890s. Marks also co-authored a song, “December and May.” In the early 1940s both songs became intertwined in a dispute that resulted in two separate lawsuits. One suit was about who had renewal rights to “December and May” and the other was an infringement action over “The Bird on Nellie's Hat.” In the latter, the defendant (the author of the infringing song) argued that both co owners (not just Marks) must sue him in order for the case to go forward. Judge Hand disagreed. He established the important legal principle, that either co-owner of copyright may bargain for, or litigate rights regarding the copyright, provided that the other co-owner receives an equitable interest in the results of the bargain or lawsuit. In the second case, Hand established that the same co-authorship principle applied for renewal as well -- that is, either co-owner may file the renewal of a copyright and that renewal benefited both co-owners, not just the co-owner who files the renewal.

Sheldon v. Metro-Goldwyn Pictures Corporation 2. Yesterday we discussed a case involving a Joan Crawford film, Letty Lynton, that infringed a play, Dishonored Lady. After resolving the issue of infringement, the case returned to the Second Circuit Court of Appeals and Hand again wrote the opinion. This time around the dispute was over how much MGM had to pay in damages. Until that time, the courts had taken the 1909 Copyright Act at its literal word; it stated the prevailing plaintiff in an infringement action was entitled to all of the defendant’s profits derived from the infringement. This was how the district court ruled and MGM appealed, claiming that only those profits attributable to the use (or portion of use) should be owed. Judge Hand acknowledged the difficulty in apportioning profits from a movie:

“Strictly and literally, it is true that the problem is insoluble. The profits from a picture consist of admission fees, which the playgoers pay because the picture attracts them with the hope of enjoyment. That enjoyment, which is one source of its further popularity, is made up of many factors: the actors, the work of the producer and director, the story, the scenery and costumes. The attraction and the hope which first draws them are principally aroused by advertisements, and the reputation of the stars and the producing company.”

Despite the difficulty, Hand jumped in to the fray and after deducting certain MGM expenses, discounting expert accounting opinions, and apportioning a reasonable value to the use of the material from Dishonored Lady, he determined that the owners of the play were entitled to one-fifth of the film’s profits. In this decision, Hand ended the era of “all profits to the winner” and set the modern standard for copyright damages still used today. Although other judges have advanced theories of damages, Hand’s analysis is still considered the gold standard.
The Complete Hand. We've said a lot of nice things about Learned Hand during the past week but we’re not trying to paint him as a saint (can an agnostic be a saint?). There are a few eccentricities to report as well.  Hand did not believe that the Bill of Rights should be considered “law” but merely "admonitory"principles. (He also advocated for the removal of the due process clauses from the Constitution and -- though strongly in favor of equal rights -- he criticized the Warren Court for its legal basis for striking down state segregationist laws.) He was a melancholic, highly self-critical and despised his own ambitions. When FDR failed to appoint him to the Supreme Court, he confided, "It was the importance, the power, the trappings of the God damn thing that really drew me on.” We’ve also seen he was a bit of a curmudgeon when it came to popular culture as evidenced by his distaste for Hollywood movies ("trivial"), comics ("silly pictures"), and popular music ("treacle"). But none of that means much compared to his accomplishments. This was, after all, the man who saved the Wright Brothers' patents and Superman's copyright. No fear of flying here. Thanks, Judge!

What is "Original" under Copyright Law?

Tell It To The Hand! In 1910, one year after being appointed as a district court judge, Learned Hand issued an injunction preventing the French aviator Louis Paulhan from making flights within the U.S. At issue were patents for the airplane’s rudder, owned by the Wright Brothers. The defendant argued that the flying machine's rudder was not novel. Judge Hand disagreed, dryly noting mankind's previous difficulty in becoming airborne.

"The number of persons who can fly at all is so limited that it is not surprising that infringers have not arisen in great numbers."

Responding to the issue of whether the rudder was novel or obvious at the time of its invention, Hand said:

“Many great inventions are of this character, and the reason why the ordinary man does not discover them although they are so plain when some one else has done so is that habit has limited his power to see what he has not been accustomed to see, and his selective attention is fast bound by his past experience.”

Two for One. In an effort to further drive down our dwindling readership, we’re going to include two of Hand’s copyright decisions today, both discussing the standard of originality.
Arnstein v. Edward B. Marks Music Corp (1936) This case is the first of five lawsuits for copyright infringement brought by songwriter Ira Arnstein over a ten-year period, most of them based on a semi-paranoid notion that famous songwriters (or their agents) had stolen Arnstein's songs by various nefarious means (including breaking into his apartment). Although not labeled as a vexatious litigant (the term hadn’t been invented then), one judge did chastise Arnstein for his “persecution mania.” (The last of the Arnstein cases was brought against Cole Porter and set the standard for summary judgment in copyright cases.) Several of the Arnstein cases are described in detail here, along with relevant sound clips.
In Arnstein v. Edward B. Marks Music Corp, Arnstein believed his melody for “I Love You Madly” had been stolen and used in defendant’s song, “Play, Fiddle, Play.” The similarities apparently were driving Arnstein mad, as he stated under oath, "I was desperate. I heard my song being played everywhere, and I was starving. I was out of my mind and might have committed murder.” Arnstein lost at trial and on appeal, he used various means to attempt to show similarities between the two songs. Alas, he misjudged Judge Hand’s knowledge of musical composition. Hand wrote:

"The second phrase of the chorus has no resemblance whatever to the next phrase of the song, but if one takes some notes of the treble in the accompaniment, moves them to the melody, raises them an octave, and cuts short the resulting melodic phrase, an identity can be made to appear. When the two songs are played the phrases show no resemblance, at least to the untrained ear. To a mind already set to find piracy, this of course seems proof strong as Holy Writ, but it is really of no significance.”

In truth, Hand did not have much affection for either composition – he referred to the lyrics of the defendant’s work as “the kind of treacle which passes in a popular love song” -- and believed pop music was an arbitrary and unpredictable business. After demolishing the plaintiff’s claims, Hand observed, “Success in such music as this is by no means a test of rarity or merit; it is a commonplace that the most experienced are usually unable to tell in advance what will hit the public fancy and what will not. Were it otherwise much waste could be avoided.”

Sheldon v. Metro Goldwyn Mayer (1936). The owners of the play, Dishonored Lady, sued the makers of the movie, Lettie Lynton, for infringement. Both works were based on a true story about a Scottish woman who was accused of poisoning her lover. The trial judge had determined there was no infringement, perhaps influenced by the fact that none of the play’s dialogue had been lifted. Judge Hand reversed:

“The play is the sequence of the confluents of all these means, bound together in an inseparable unity; it may often be most effectively pirated by leaving out the speech, for which a substitute can be found, which keeps the whole dramatic meaning. That as it appears to us is exactly what the defendants have done here; the dramatic significance of the scenes we have recited is the same, almost to the letter. True, much of the picture owes nothing to the play; some of it is plainly drawn from the novel; but that is entirely immaterial; it is enough that substantial parts were lifted; no plagiarist can excuse the wrong by showing how much of his work he did not pirate.”

Hand continued with a statement familiar to most students of copyright:

"If by some magic a man who had never known it were to compose anew Keats's Ode on a Grecian Urn, he would be an "author," and, if he copyrighted it, others might not copy that poem, though they might of course copy Keats's."

In other words, copyright does not protect against similarities, it protects against copying. The Sheldon case also led to another important copyright standard known as the Sheldon Rule, and we’ll discuss that in tomorrow’s final entry. Thanks Judge.

At What Point Does Copyright Protect a Plot and Its Characters?

Tell It To The Hand! Some facts you probably didn't know about Judge Learned Hand:

• his first name was Billings (ideal for a lawyer), 
• he was friends with the artist Maxwell Parrish (and his wife posed for one of Parrish's paintings), 
• he considered himself a melancholic (and "hopelessly hypochondriac"), and
• he was the godfather of J.D. Salinger's daughter, Peggy.

The Salinger Connection. Salinger and Hand, neighbors in Cornish, New Hampshire, were close friends. Salinger considered Hand a "yogi" and according to J. D. Salinger: A Life by Kenneth Slawenski, Hand's relationship with Salinger was perhaps the "fullest he had enjoyed." The men shared an intense interest in spiritual topics, and Salinger confided in Hand about his wife Claire's loneliness. Slawenski writes:

"Sadly, both men were enmeshed in troubled marriages, a fact both painstakingly concealed from others. Perhaps most important, both Salinger and Learned Hand suffered from periods of deep depression, a penchant towards melancholy that fused them together in a way unique to such sufferers."

Salinger wrote to Hand regularly and those letters were among the many paraphrased in a biography of Salinger by Ian Hamilton in the 1980s.  Salinger sued over Hamilton's paraphrasing of his letters and an appeals court ruled against Hamilton, relying on a Learned Hand case, Nichols v. Universal Pictures, as precedent.
Nichols v. Universal Pictures (1930).  Abie's Irish Rose, a corny tale of interfaith marriage, had been one of the longest-running shows on Broadway (inspiring playwright Lorenz Hart to pen the couplet: "Our future babies we'll take to Abie's Irish Rose -- I hope they'll live to see it close.") Despite a critical drubbing  (Robert Benchley said, "People laugh at this every night, which explains why democracy can never be a success.") the play was a huge hit and and like all hits, inspired imitators including the motion picture, The Cohens and the Kellys. The owners of Abie's sued for copyright infringement.
Abie's and The Cohens shared similarities: both plots involved children of Irish and Jewish families who marry secretly because their parents are prejudiced. At the end of each work there is a reconciliation of the families, based upon the presence of a grandchild. Beyond that, the works had little in common except for some ethnic cliches. The challenge in assessing this type of infringement is how to measure nonliteral similarities -- that is differences other than verbatim copying.  Learned Hand's visionary analysis demonstrated a deep understanding of the creative process:

"Upon any work, and especially upon a play, a great number of patterns of increasing generality will fit equally well, as more and more of the incident is left out. The last may perhaps be no more than the most general statement of what the play is about, and at times might consist only of its title; but there is a point in this series of abstractions where they are no longer protected, since otherwise the playwright could prevent the use of his "ideas," to which, apart from their expression, his property is never extended."

In other words, the premise of a film -- say Boy-Meets-Girl-Boy-Loses-Girl-Boy-Gets-Girl -- is never protected but the fully expressed plot -- say, When Harry Met Sally, can be protected. And the same is true for the characters within a play. Hand wrote -- in what was to become one of the most quoted statements in copyright law:

"If Twelfth Night were copyrighted, it is quite possible that a second comer might so closely imitate Sir Toby Belch or Malvolio as to infringe, but it would not be enough that for one of his characters he cast a riotous knight who kept wassail to the discomfort of the household, or a vain and foppish steward who became amorous of his mistress. These would be no more than Shakespeare's "ideas" in the play, as little capable of monopoly as Einstein's Doctrine of Relativity, or Darwin's theory of the Origin of Species. It follows that the less developed the characters, the less they can be copyrighted; that is the penalty an author must bear for marking them too indistinctly."

We don't want to belabor the point  -- though we are lawyers -- but Nichols was the breakthrough that enabled judges to assess and compare narrative works built around similar underlying ideas. Although it is true that wherever Hand's line of abstractions is drawn, it may seem arbitrary, "that," as the judge stated in Nichols, "is no excuse for not drawing it." Nichols has been cited in over 1,900 cases and its precepts have been borrowed for legal theories affecting software and websites. Thanks Judge.

P.S. Bridget Loves Bernie Dept. The unprotectible plot premise discussed in Nichols was resurrected in the 1972 TV show Bridget Loves Bernie. Oddly, an Irishman named David Birney played the Jew, Bernie, who married his co-star in real life. Sadly, the network dumped the show after one season  - even though it was in the top five for ratings -- reportedly because the networks had so many complaints about interfaith marriage. Go figure.

Saving Superman

Tell It To The Hand! More on the Reiss case. Yesterday we mentioned that James Joyce's Ulysses was released within a year of Judge Learned Hand's decision in the Reiss case. What we forgot to mention was that 13 years later, Judge Hand was on a three-judge panel that ruled that Ulysses was not obscene. The decision was written by Augustus Noble Hand, Learned's cousin, also a federal judge. (The third judge on the panel dissented, making this a two-Handed decision.) The cousins apparently shared an expansive view of the arts. Augustus wrote: "Art certainly cannot advance under compulsion to traditional forms, and nothing in such a field is more stifling to progress than limitation of the right to experiment with a new technique." Here here!
The L-Man Goes to Hollywood.  In the mid-1930s, Learned Hand visited Hollywood and watched a movie production. He later wrote of his experience for the Harvard Alumni Bulletin:

"Who could resist the inspiration of the magic by which light and sound were converted into some other essence, instantaneously transported, and made permanent upon a tiny celluloid strip? When one reflected upon the years of devotion and ingenuity, of seething imagination, and of patient verification which lay behind these results, it seemed an honor merely to be one of a species which could do such things."

As much as he appreciated the 'medium,' he was baffled at the 'message,' and considered most popular films to be "tawdry, trite, dreary, and childish." He asked:

"Of what value is it to scale the heavens, to descend to the bowels of the earth, to practice alchemy and all the necromancer's art, if the end were to be so pitiful as this?" 

Good question L-Man and we're only glad that you didn't live long enough to see Jersey Shore. 
National Comics v. Fawcett Publications, Inc. Learned Hand was no fan of comics (he viewed the Superman strips as "silly pictures" -- a view shared by cousin Augustus who, in another case, referred to these comics as "poor thing but mine own") but Hand influenced copyright law and modern culture when he pulled Superman from the public domain. It was 1952 and the legal battle between Captain Marvel and Superman had been going on for such a long time (12 years) that the super hero stories seem to have become intertwined (Was Lex Luthor a copy of Marvel's villain Dr. Sivana or vice versa?) The previous year, Captain Marvel had triumphed at trial -- not because he was original (the trial court ruled that he infringed Superman) -- but because Superman's owners had failed to include proper copyright notice on several strips. Under the 1909 Copyright Act, if you failed to include proper notice, you lost copyright. So, U.S. copyright law had done what kryptonite could not -- dooming the Man of Steel to an unprotected life in the public domain.

Poor Thing But Mine Own. As a general principle, Hand believed that technical pitfalls should not trump personal rights. In National Comics, Hand was able to combine that precept with a copyright principle he had pioneered two decades earlier in Nichols v. Universal Pictures (which we'll talk about  later this week). In Nichols, Learned Hand introduced the then-revolutionary idea that a character within a work could achieve copyright protection separate and apart from the underlying work. Learned Hand reversed the trial court and in a wise bit of judicial surgery, held that the improper notice only doomed certain Superman strips to the public domain, not the Superman character. He wrote, "The absence of any notice, or the affixing of an imperfect notice, upon one strip had no effect upon the copyright upon another strip depicting a different exploit."

Bare-faced infringers. Hand's decision prevented a "bare-faced infringer" (Captain Marvel) from profiting and prospering because of a technical forfeiture. (Hand later took this approach even further in Peter Pan Fabrics, Inc. v. Martin Weiner Corp., his final copyright decision where, in a flash of judicial activism, he prevented a fabric design from falling into the public domain because of a lack of notice.) When Hand decided National Comics, the United States was the only country in which copyright was forfeited if no notice was provided. In that sense, National Comics was 40 years ahead of its time.  In 1989, the U.S. gave up the ghost when Congress changed the law and ended this unjustifiable requirement. Thanks Judge.

Are Incomprehensible Words Protected Under Copyright?

Tell It To The Hand! We decided to celebrate our fourth year on the Internets by discussing five great copyright decisions by Judge Learned Hand. Yes, we know many of you have pressing questions (and we promise to get to them soon) but they'll have to wait while we finish our tribute to the most Zen jurist ever to sit on the federal bench.  ("Life is not a thing of knowing only," he once said. "Mere knowledge has properly no place at all save as it becomes the handmaiden of feeling and emotion.") And we have to love a federal judge who wanted every courthouse and church entrance emblazoned with Cromwell's words, “I beseech ye in the bowels of Christ, think that ye may be mistaken.” The L-man's advantage in copyright law (and the reason why he could redirect that law into the 21st Century) was because he understood (and was in awe of) the creative mind. Ennyway, the proof's in the pudding.
Reiss v. National Quotation Bureau, Inc. Learned Hand decided Reiss in 1921, a remarkable year for the arts -- Picasso's Three Musicians debuted as did Mondrian's Red, Yellow, and Blue, and Eubie Blake was having a hit with his ragtime jazz piano roll for I'm Just Wild about Harry. Within a year of the Reiss decision, James Joyce would publish Ulysses.
In Reiss, a man had published a book of 6,325 “coined” or nonsense words that could be used as a secret code by telegraph operators (who would assign private meanings to the meaningless words). A publisher copied the code words and when sued, defended himself by arguing that copyright could not protect the book because the code words had no "meaning." Judge Hand established a principle that we now take for granted: copyright law does not impose a standard of comprehension on works of authorship. Like Picasso, Mondrian, Blake and Joyce, Hand understood that the narrative sensibility (whether in stories, imagery or music) was no longer essential, if it ever was.

"I see no reason why words should [not be protected] because they communicate nothing. They may have their uses for all that aesthetic or practical and they may be the productions of high ingenuity or even genius." 

The code words, said Hand, were like "an empty pitcher" in that they had a prospective meaning, but as yet had not received it.

"Not all words communicate ideas; some are mere spontaneous ejaculations, some are used for their sound alone, like nursery jingles, or the 'rhymes of children in their play. Might not some one, with a gift for catching syllables, devise others? There has of late been prose written, avowedly senseless, but designed by its sound alone to produce an emotion. Conceivably there may arise a poet who strings together words without rational sequence - perhaps even coined syllables - through whose beauty, cadence, meter, and rhyme he may seek to make poetry."

Fifty-seven years after Reiss was published, it became a cornerstone for protecting computer code; it was used by the CONTU Commission to validate protection of computer code, and served as precedent for the seminal case protecting operating systems and object code.  Thanks Judge.