Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

In these parallel cases, separate petitions were filed requesting the district court to set a "reasonable" rate after ASCAP and BMI were unable to agree on licensing fees with DMX, a provider of background/foreground music. In both cases, the district court adopted DMX's proposals. The court held the Second Amended Final Judgment (AFJ2) permitted blanket licenses subject to carve-outs to account for direct licensing and the court rejected ASCAP's claim that a blanket license with an adjustable carve-out conflicted with the AJF2. The court concluded that the district court in both cases found that ASCAP and BMI did not sustain their burdens of proving that their proposals were reasonable; no legal error contributed to these findings and the findings supported by the record were not clearly erroneous; and in both instances, the district court had the authority to set a reasonable rate for DMX's licenses. Accordingly, the court held that the district court did not err in setting DMX's licensing rates with ASCAP and BMI and that the rates set by the district court were reasonable. View "Broadcast Music, Inc. v. DMX Inc.; American Society of Computers, Authors and Publishers v. THP Capstar Acquisition Corp." on Justia Law

Defendant, a computer programmer employed by Goldman Sachs & Co., appealed his conviction for stealing and transferring proprietary computer source code of Goldman's high frequency trading system in violation of the National Stolen Property Act (NSPA), 18 U.S.C. 2314, and the Economic Espionage Act of 1996 (EEA), 18 U.S.C. 1832. Defendant argued, inter alia, that his conduct did not constitute an offense under either statute because: (1) the source code was not a "stolen" "good" within the meaning of the NSPA, and (2) the source code was not "related" to a product "produced for or placed in interstate or foreign commerce" within the meaning of the EEA. The court agreed and concluded that defendant's conduct did not constitute an offense under either the NSPA or the EEA, and that the indictment was therefore legally insufficient. Accordingly, the court reversed the judgment of the district court. View "United States v. Aleynikov" on Justia Law

Plaintiffs appealed from the judgment of the district court granting summary judgment to defendants on all claims of direct and secondary copyright infringement based on a finding that defendants were entitled to safe harbor protection under the Digital Millennium Copyright Act (DMCA), 17 U.S.C. 512. The court held that, although the district court correctly held that the section 512(c) safe harbor required knowledge or awareness of specific infringing activity, the court vacated the order granting summary judgment because a reasonable jury could find that YouTube had actual knowledge or awareness of specific infringing activity on its website. The court further held that the district court erred by interpreting the "right and ability to control" infringing activity to require "item-specific" knowledge. Finally, the court affirmed the district court's holding that three of the challenged YouTube software functions fell within the safe harbor for infringement that occurred "by reason of" storage at the direction of the user, and remanded for further fact-finding with respect to a fourth software function. Accordingly, the court affirmed in part, vacated in part, and remanded. View "Viacom International, Inc., et al. v. Youtube, Inc., et al.; The Football Assoc. Premier League Ltd., et al. v. Tur, et al." on Justia Law

This case involved the importation and sale of counterfeit luxury goods bearing trademarks owned by Louis Vuitton (plaintiff) and others. Defendants appealed from the district court's judgment granting summary judgment to plaintiff on its claims of trademark counterfeiting and infringement, and awarding plaintiff statutory damages in the amount of $3 million, and more than $500,000 in attorney's fees and costs. The court concluded that the district court did not abuse its discretion in declining to stay the proceedings; that, as the district court concluded, an award of attorney's fees under 15 U.S.C. 1117(a) could accompany an award of statutory damages pursuant to 15 U.S.C. 1117(c); and that the district court did not abuse its discretion in awarding such fees or in setting their amount. Accordingly, the judgment was affirmed. View "Louis Vuitton Malletier S.A. v. LY USA, Inc., et al." on Justia Law

Plaintiff filed suit alleging that two shoe lines manufactured by defendant infringed plaintiff's trademark. At issue was whether a trademark registrant's delivery of a covenant not to sue, and voluntary dismissal of its trademark claims, divested a federal court of subject matter jurisdiction over a defendant's counterclaims for a declaratory judgment and cancellation of the trademark's registration. After considering the breadth of plaintiff's covenant not to sue and the improbability of future infringement, the district court dismissed defendant's counterclaims because no case or controversy existed under Article III of the United States Constitution. The court agreed with the district court and affirmed the judgment.

This appeal stemmed from numerous trademark and unfair competition claims over the name "Patsy's." Patsy's Italian Restaurant appealed, and Patsy's Pizzeria cross-appealed, from a judgment of the district court after a jury trial on claims brought pursuant to trademark and unfair competition law. The court upheld the district court's jury instructions; affirmed the district court's refusal to grant a new trial on the issue of whether Patsy's Pizzeria made fraudulent statements to the Patent and Trademark Office, as well as its refusal to vacate the jury's verdict that Patsy's Italian Restaurant did not fraudulently obtain its trademark registrations; affirmed the district court's refusal to reinstate Patsy's Pizzeria's trademark registrations; and upheld the district court's denial of attorneys' fees and injunctive relief. Accordingly, the court affirmed the judgment of the district court.

Plaintiffs in this consolidated class action allege copyright infringements arising from defendant publishers' unauthorized electronic reproduction of plaintiff authors' written works. The district court certified a class for settlement purposes and approved a settlement agreement over the objection of ten class members (objectors). In this appeal, objectors challenged the propriety of the settlement's release provision, the certification of the class, and the process by which the district court reached its decisions. Although the court rejected the objectors' arguments regarding the release, the court concluded that the district court abused its discretion in certifying the class and approving the settlement because the named plaintiffs failed to adequately represent the interest of all class members. The court did not reach the procedural challenges, which were moot in light of the court's class certification holding. Therefore, the court vacated the district court's order and remanded for further proceedings.

Plaintiff sued defendant, claiming, among other things, copyright infringement under 17 U.S.C. 501, trademark infringement under 15 U.S.C. 1114(a), and unfair competition under New York state law. At issue was whether the first sale doctrine, 17 U.S.C. 109(a), applied to copyrighted workers produced outside the United States but imported and resold in the United States. The court held that the first sale doctrine did not apply to works manufactured outside of the United States; the district court did not err in declining to instruct the jury regarding the unsettled state of the first sale doctrine; and the district court did not err in admitting evidence of defendant's gross revenues. Accordingly, the judgment of the district court was affirmed.

After a bench trial, the district court entered a judgment for plaintiffs concluding that on seventeen occasions, defendant had infringed plaintiffs' copyrights in their research reports, and that by collecting and disseminating to its own subscribers the summary recommendations with respect to securities trading contained in plaintiffs' reports, defendant had committed the New York state law tort of "hot news" misappropriation. Defendant appealed the judgment and injunction against it on the "hot news" misappropriation claim. The court held that plaintiffs' claim against defendant for "hot news" misappropriation of the plaintiff financial firms' recommendations to clients and prospective clients as to trading in corporate securities was preempted by federal copyright law. Based upon principles explained and applied in National Basketball Association v. Motorola ("NBA"), the court held that because plaintiffs' claim fell within the "general scope" of copyright, 17 U.S.C. 106, and involved the type of works protected by the Copyright Act, 17 U.S.C. 102 and 103, and because defendant's acts at issue did not meet the exceptions for a "hot news" misappropriation claim as recognized by NBA, the claim was preempted. Accordingly, the court reversed the judgment of the district court with respect to that claim.

This appeal arose out of a successful forfeiture action brought by the United States government pursuant to 19 U.S.C. 1595a, which denied appellant's subsequent motion for attorney's fees. The forfeiture action sought to recover the Pissaro work of art entitled "Le Marche" that was reported stolen from the Musee Faure in Aix-les-Bains, France in 1981. At issue was whether the district court erred by refusing to apply the protections afforded by 18 U.S.C. 983 to the government's section 1595a claim and by denying her motion for attorney's fees after two of the government's three forfeiture claims were dismissed at summary judgment. The court held that a forfeiture action brought pursuant to section 1595a was not governed by section 982 and therefore, appellant was not entitled to raise the innocent-owner defense provided by section 983(d) or to take advantage of the heightened proof requirement of section 983(c). Therefore, the court affirmed the district court's judgment of forfeiture and since appellant was not a prevailing party within the meaning of 28 U.S.C. 2465(b)(1), she was not entitled to attorney's fees under the statute.