Category Archives: Copyrights

If a patent can’t cover an “abstract idea,” can it be a trade secret?

Should I patent my invention or keep it a trade secret?  QuestionInventors often ask me this question.  And after a recent court decision and USPTO actions that raise the bar for patenting software inventions, the question is becoming even more important for software developers who want to protect their IP.

In Alice Corporation Pty Ltd. v. CLS Bank Int’l, the Supreme Court made it clear that “abstract ideas” are not eligible subject matter for patent protection. The decision, as well USPTO Preliminary Examination Instructions that followed the decision, suggest that inventive concepts such as algorithms, financial business methods and methods of organizing human activity are not, in themselves, patentable unless claimed with additional elements that make the claim cover significantly more than just the abstract idea.

So, does this mean that it’s better to keep certain inventions as a trade secret? Will trade secret law protect abstract ideas in a way that patent law can’t?

In most cases, probably not. Several state court decisions suggest that a trade secret needs to be described in an enabling manner in order for the owner to enforce trade secret rights against others.

For example,the Court of Appeal for the State of California recently held that in California, a “trade secrets plaintiff must, prior to commencing discovery, ‘identify the trade secret with reasonable particularity.’” New Castle Beverage, Inc. v. Spicy Beer Mix, Inc., (Cal. App. 6/17/2014).  In that case, the complaint described the trade secret as a “process of applying a secret solution to the inner and outer surfaces adjacent the lip of a beverage cup to permit a first mixture of spices to adhere to those surfaces.” The court found this description to be too vague.  Also, the lower (trial) court expressed a concern that if it were to grant a preliminary injunction, the court would have difficulty determining whether the defendant was violating the injunction.

This means that when deciding whether to patent a process or keep it trade secret, the inventor should work with his or her attorney to assess which area of law provides the best protection, not which regime is easier to use. In both situations, the inventor should identify and document a complete description of the process.  This description needs to include more than just the general idea itself, it needs to explain how the idea is implemented as technology.

So, if the question is “can I protect it,” patent law and trade secret law will often lead to similar answers.  Neither area of law is likely to help an inventor who either can’t or won’t fully describe the process in a way that enables a reader to make and use the process, and that allows a court to determine when an infringer is using the process.

[Image credit:  Copyright: <a href='http://www.123rf.com/profile_anatolymas'>anatolymas / 123RF Stock Photo</a>]

What cloud computing services need to know about the Aereo decision

In June. the United States Supreme Court issued its much-anticipated decision in American Broadcasting Cos. v. Aereo, Inc. The decision effectively shut down the Aereo service, at least temporarily as it explores fundamental changes to its business model to permit it to continue distributing content while complying with the Court’s decision.

The Aereo service in question offered subscribers the ability to watch television broadcasts over the Internet, streamed in substantially real time as the programs were being distributed over-the-air by the original broadcasters. Aereo implemented this service via a network of antennas. When a subscriber selected a program, Aereo would select an antenna, deliver the program to the subscriber via the antenna, and dedicate the antenna to the subscriber until the program was complete.

The question that the Court considered was whether Aereo’s retransmission violated U.S. copyright law.  The Court focused on the section of the Copyright Act that gives a copyright owner the exclusive right to “perform the copyrighted work publicly.” The Copyright Act defines that exclusive right to include the right to “transmit or otherwise communicate a performance . . . of the [copyrighted] work . . . to the public, by means of any device or process, whether the members of the public capable of receiving the performance . . . receive it in the same place or in separate places and at the same time or at different times.”

Aereo argued that it did not transmit any performances “publicly” but rather only enabled the transmission of content privately, to a single subscriber at a time. However, the Court found that Aereo’s overall system could transmit a program to many subscribers, and that its activities constituted a “public” performance. In particular, the Court stated:  “we conclude that when an entity communicates the same contemporaneously perceptible images and sounds to multiple people, it transmits a performance to them regardless of the number of discrete communications it makes.”

The Court’s conclusion, if taken out of context, could cause cloud storage service providers to be concerned. Services that allow users to store music, video and other content online for on-demand delivery may indeed wonder whether their services permit “public performance” when a user accesses stored online content.

However, the Court took care to say that its ruling was limited to an interpretation of the Copyright Act’s Transmit Clause, which the Court said was intended to apply “to cable companies and their equivalents, [and] did not intend to discourage or to control the emergence or use of different kinds of technologies.” The Court noted that the term “public” in this context “does not extend to those who act as owners or possessors of the relevant product. And we have not considered whether the public performance right is infringed when the user of a service pays primarily for something other than the transmission of copyrighted works, such as the remote storage of content.”

Thus, not only did the Court state that it was not addressing remote storage systems, it also hinted that it would not consider distribution of remotely stored content in a cloud storage service to be a violation of copyright law because those distributions were not to the “public.”

So, at least for the present, remote storage services can take comfort in lower court decisions such as Cartoon Network LP v. CSC Holdings (2nd Cir. 2008), which held that remote DVRs may operate without violating copyright law.

 

 

Getty Images makes photo collection available for free use: but watch the fine print

Stock photo giant Getty Images has announced a new “embed” feature in which it will make a substantial portion of its image library available for free use on websites and in social media.

While many news reports are (rightly) touting this as a major new resource for online publishing, publishers should take care to read the fine print before cutting and pasting any images.  It’s important to remember that “free” doesn’t mean “no strings attached.”

Most importantly, Getty Images is not permitting cutting and pasting at all.  Instead, it will require that its images be embedded using a tool that provides credit and a link back to the source.  This could give Getty Images the opportunity to include ads or collect data relating to usage, much like video and music sharing sites do now when allowing others to embed their content.

In addition, the license only permits use for editorial purposes.  As stated in Getty Images’ Embedded Viewer Terms and Conditions:

You may only use embedded Getty Images Content for editorial purposes (meaning relating to events that are newsworthy or of public interest). Embedded Getty Images Content may not be used: (a) for any commercial purpose (for example, in advertising, promotions or merchandising) or to suggest endorsement or sponsorship; (b) in violation of any stated restriction; (c) in a defamatory, pornographic or otherwise unlawful manner; or (d) outside of the context of the Embedded Viewer.

Other digital media companies have found embedded viewers to be a strong revenue source.  With the limited license governing the embedded viewers, Getty appears to be seeking to improve revenue from an area (social media) that had been very difficult to monetize without except through substantial enforcement efforts.

Upcoming Supreme Court decision could shape future of internet video streaming

This year the U.S. Supreme Court will review the Second Circuit’s decision in American Broadcasting Companies, Inc. v. Aereo, Inc The result could affect how and when consumers can receive broadcast television over the Internet.

In its decision to grant certiorari, the Supreme Court agreed to consider the question:

Does a company “publicly perform” a copyrighted television program when it retransmits a broadcast of that program to thousands of paid subscribers over the Internet?

The case involves Aereo, Inc., which allows subscribers to watch broadcast television programs over the Internet for a monthly fee. Aereo’s system uses antennas and a remote hard drive to create individual copies of the programs. Users of Aereo can watch programs while they are being broadcast, or they can record them to watch at a later time, like an online DVR.

Several plaintiffs who held copyrights in programs broadcast on network television sued Aereo for copyright infringement, arguing that Aereo should not be permitted to transmit programs to its subscribers while the programs are still airing because the retransmission infringed their exclusive right to publicly perform their works. The plaintiffs also asserted that Aereo infringed their exclusive right of reproduction of the copyrighted programs, as well as contributory infringement.

The plaintiffs moved for a preliminary injunction, and the district court denied it. The plaintiffs appealed, and the U.S. Court of Appeals for the Federal Circuit affirmed. The plaintiffs have now appealed again to the Supreme Court, which is expected to consider the case in early 2014.

The Second Circuit’s decision found significant the fact that Aereo made individual copies of broadcasts. Rather than being a “public” performance, the Court found Aereo’s system to provide private retransmissions “since the entire chain of transmission from the time a signal is first received by Aereo to the time it generates an image the Aereo user sees has a potential audience of only one Aereo customer.”

The Supreme Court’s decision could be significant regardless of the result. If the Court upholds the decision, depending on the Court’s reasoning the case could make it difficult for over-the-air broadcasters to police against retransmission of their content online.  Or, if the Court reverses, the reasoning may prompt significant changes to the business models of Web-based (and perhaps even in-home) video transmission products.

Copyright, fair use and artistic works: can a work be transformed without being “transformative”?

Compare Cariou and Prince

Court: too close to call

A recent Second Circuit court decision appears to establish a broad fair use exception for the use of artistic works in new works.  However, a careful look at the case — and especially at the examples which the court considered too close to call as a matter of law — could leave artists feeling confused about just how broad the exception really is.

The case of Cariou v. Prince involved several photographs by Patrick Cariou. Cariou published his photographs in a book entitled Yes Rasta.  Artist Richard Prince altered and incorporated 25 of Cariou’s photos into various paintings and collages. Prince displayed his works in various exhibitions, and he also sold reproductions of a few of them. Continue reading

Supreme Court: Copyrighted works may be imported into and sold the United States if lawfully made abroad

A math student with an eye for a bargain has shaken up the U.S. publishing 1309128948industry after the U.S. Supreme Court ruled in favor of his textbook importation scheme.

Supap Kirtsaeng moved from Thailand to the United States to study mathematics at Cornell University. Frustrated over the high cost of textbooks at the school, he asked friends and family to purchase books in Thailand — where they were available at a much lower retail price — and ship them to him in the U.S.   Recognizing the business opportunity, Kirtsaeng began reselling the imported books on eBay.  Over time, Kirtsaeng generated about $600,000 in revenue from his textbook resale business. Continue reading

New house and senate bills, and White House memo, call for open public access to publications and data resulting from federally funded research

If a new White House memo directing government agencies to ensure that publications and data resulting from federally funded research seems familiar, that’s because it nearly matches a new bill that was introduced in the House and Senate just a week earlier.

On February 22, 2013, the White House’s Office of Science and Technology Policy issued a memo directing U.S. government agencies who annually fund over $100 million in research to implement a plan for requiring public access to data and publications resulting from that research.

The memo requires that each plan included elements for: Continue reading