Project Gutenberg: the German edition?

Project Gutenberg is an American website which digitises and archives cultural works to encourage the creation and distribution of eBooks. It currently offers 56,000 free books for download, including classics such as Pride and Prejudice, Heart of Darkness, Frankenstein, A Tale of Two Cities, Moby Dick, and Jane Eyre. Many of these titles are available because their copyright protections have expired in the United  States, and are therefore in the public domain. The website is a volunteer effort which relies mostly on donations from the public.

What does it mean if a book is in “the public domain”? This term means that something (a novel, artwork, photograph or other creation) is not protected by intellectual property law, including copyright, trade mark, or patent. Accordingly, the general public owns the work, and not the individual creator. Permission is therefore not required to use the creation.

Despite the noble cause of making literature available at no or low cost to the masses, a recent ruling against Project Gutenberg has resulted in the website being geo-blocked for all visitors attempting to access the site from Germany. The claimants in the case are the copyright owners of 18 German language books, written by three authors, each of whom died in the 1950s.

In Germany, the term of copyright protection for literary works is “life plus 70 years,” as it is in the United States. However, the United States applies different rules for works published before 1978. For works published before 1978, the maximum copyright duration is 95 years from the date of publication. In the United States, the 18 books in question are all in the public domain. For the avoidance of doubt, Project Gutenberg runs on servers at the University of North Carolina at Chapel Hill, and is classified as a non-profit charity organisation under American law.

Sharing and accessing the written word has changed since the 16th century! Engraving showing a publisher’s printing process, from the Met Museum.

The copyright holders of these works notified Project Gutenberg of their alleged infringement back in 2015. In early February 2018, the District Court of Frankfurt am Main approved the claimant’s “cease and desist” request to remove and block access to the 18 works in question. The claimants also requested administrative fines, damages, and information in respect of how many times each work was accessed from the website.


Our eBooks may be freely used in the United States because most are not protected by U.S. copyright law, usually because their copyrights have expired. They may not be free of copyright in other countries. Readers outside of the United States must check the copyright terms of their countries before downloading or redistributing our eBooks.

The Court reasoned that it was worth taking into account the fact that the works in dispute are in the public domain in the United States. This however “does not justify the public access provided in Germany, without regard for the fact that the works are still protected by copyright in Germany.” The simple message on the front page (cited above) may not be sufficient to draw users’ attention to the fact that what they are downloading may be in contravention of national copyright laws.

The judgement also cited Project Gutenberg’s own T&Cs in its decision, noting that the website considers its mission to be “making copies of literary works available to everyone, everywhere.” While this broad statement may seem innocuous and idealistic, the court used this to support its findings that Project Gutenberg could not reasonably limit itself as an America-only website.

A key point in this matter is the question of jurisdiction. While Project Gutenberg is based in the USA, the claimants successfully argued that as the works were in German and parts of the website itself had been translated into German, the website was indeed “targeted at Germans.” Furthermore, even if the website had not been intended for German audiences, that the infringement occured in Germany is sufficient grounds to bring the claim in German court.

While Project Gutenberg was only required to remove the 18 works listed in the lawsuit, the organisation has blocked its entire website in Germany to protect itself from any further potential lawsuits on similar grounds (see the Q&A here). Project Gutenberg is planning to appeal the decision.

This first published on the 1709 Copyright Blog. You can also read more at the IPKat here.


From Stockholm to Stock Market: Sweden’s Spotify set to list on NYSE

Music streaming giant Spotify recently filed its application to put shares on the New York Stock Exchange. The 264 page document details the company’s key risks and challenges: I’ve read them so you don’t have to!

The Securities Exchange Act of 1933, often called the Truth in Securities law, requires that investors receive financial and other significant information concerning financial securities. To avoid misrepresentations and other fraud, any company wishing to place its shares on an American market must submit a prospectus, formally known as an SEC Form S-1 (or an F-1 for foreign companies).

Sweden-based Spotify filed their prospectus for the New York Stock Exchange on 28 February.  Prospectuses are heavily regulated, and accuracy is vital: it is a lawyer’s job to fact-check these documents in a process known as “verification.” To allow investors to make informed decisions, a company must be honest about its particular commercial situation, and explain how share prices may decline. Spotify’s estimated valuation is nearly $20 billion, but it has never made a profit and reports net losses of €1.2bn (£1.1bn).

Spotify clearly needs a capital injection,
but given the risks below, would you invest?

Hitting the right note with listeners.
Spotify’s unique features include advanced data analytics systems and proprietary algorithms which predict music that users will enjoy. These personalised streams rely on Spotify’s ability to gather and effectively analyse large amounts of data, together with acquiring and categorising new songs that appeal to “diverse and changing tastes.” If Spotify fails to accurately recommend and play music that customers want, the company may fail to retain or attract listeners.

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Spotify knows that 71% of my recent tunes are energetic, upbeat, and suitable for a fitness enthusiast. Touché!

Licensing and royalties.
To make its 35 million tracks available for listeners, Spotify requires licenses from the musicians and record labels who own the songs. Additionally, Spotify has a complex royalty payment scheme, and it is difficult to estimate the amount payable to musicians under their license agreements. Even if Spotify secures the necessary rights to sound recordings from record labels and other copyright owners, artists may wish to discontinue licensing rights, hold back content, or increase their royalty fees. In 2014, Taylor Swift removed her songs from the streaming service in protest, although she later added it back.

Technical glitches and data protection.
Spotify’s software and networks are highly technical and may contain undetected bugs or other vulnerabilities, which could seriously harm their systems, data, and reputation. Growing concerns regarding privacy and protection of data, together with any failure (or appearance of failure) to comply with data protection laws, could diminish the value of Spotify’s service. This especially worth noting as Europe nears the General Data Protection Regulation (GDPR) implementation date of 25 May.

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Spotify’s NYC offices

Innovation and skilled employees.
Rapid innovation and long-term user engagement is prioritised over short-term financial gain. Spotify admits “this strategy may yield results that sometimes do not align with the market’s expectations.” The company also depends on highly skilled personnel to operate the business, and if they are unable to attract, retain, and motivate qualified employees, the ability to develop and successfully grow the company could be harmed.

International regulation and taxation.
As Spotify expands into new territories, it must adhere to a variety of different laws, including those in respect of internet regulation and net neutrality. Spotify even admits that language barriers, cultural differences, and political instability can bring share prices down! Furthermore, public pressure continues to encourage governments to adopt tougher corporate tax regimes, and tax audits or investigations could have a material adverse effect on the company’s finances.

Image result for bloomberg spotify

Method of offering.
While Spotify may not be able to successfully overcome each challenge listed in its prospectus, many of the risks are relatively common amongst international technology and media companies. But as an additional risk, Spotify has chosen a relatively unconventional method known as a direct public offering (DPO) to bring its shares to the stock market. Unlike a traditional IPO, in a DPO a company will not use an investment bank to market or underwrite (insure) its offering. While this avoids bank fees, uncertainty can result in a discounting of share prices. This is a really technical point and somewhat nuanced (it gave me headaches in law school!) but a risk worth noting.

I’ve written previously about Spotify’s copyright challenges, as well as its controversial privacy policy

Lawyerpalooza: when music festivals get intellectual property licensing wrong

Commercialisation is the process of bringing Intellectual Property (IP) to the market in order to be exploited: put simply, it’s how artists make money from their creations. To maintain control and balance risk against rewards, creators often use license agreements to ensure their work is used only in accordance with their wishes. So what happens when things go wrong?

Juan Marco is an artist from Los Angeles, California who has created illustrations and branding projects for the last decade. Marco’s work includes characters “inspired by musical energy — how it flows through your body when you create and listen to music.”

For the last several years, Marco has been the official designer for the popular Lollapalooza music festival. As part of this business relationship, he entered into an intlelectual licence agreement with C3 Presents, the concert promotion and artist management company responsible for Lollapalooza.

Licensing is a common way of commercialising intellectual property. A licensing agreement is simply a partnership between an intellectual property rights (IPR) owner and another user who is granted permission to use the IPRs in exchange for an agreed fee or royalty payment. This allows Marco (the licensor) to retain ownership of his work, while at the same time receiving income from C3 (the licensee).

One of the most important provisions of the agreement concern the scope of the licensee’s rights, covering (1) which IPRs are being licensed, (2) exclusivity, and (3) the extent of the licence. “Extent” in this context simply details if the IP can only be used for certain activities, events, or within certain territiories.

The original licence was for the non-exclusive use of various illustrations for Lallopalooza events in Chicago, USA and Santiago, Chile for three years. However, in a recent lawsuit filed in California District Court, Marco argues that his illustrations have been used outside of the original scope as agreed in the licence.

The alleged infringement includes using and modifying the artwork in unauthorised ways, as well as using it in locations beyond Chicago and Santiago. For example, Marco’s artwork is used in connection with the Lollapalooza event in Paris, as seen on the Lollaparis website. Additionally, Marco accuses C3 of sub-licensing his artwork to other users without his permission, in order to manufacture and create products which are similar or substantially similar to Marco’s original artwork.
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Marco is therefore claiming for copyright infringement, together with vicarious and contributory copyright infringement. In the first claim, he alleges that he has suffered substantial damages – both general and special – to his business. He notes that the Defendants have profited as a direct result of their “wilful, intentional and malicious” copyright infringement, and is asking for statutory damages of up to $150,000 per infringement.

In his second claim, Marco alleges that the C3 and the other Defendants are vicariously liable for the infringement carried out by other parties. The lawsuit states that the Defendants “knowingly induced, participated in, aided and abetted in and profited from the illegal reproduction and subsequent sales” of his artwork.

By alleging contributory copyright infringement, Marco is asking the Court to consider the Defendant’s secondary liability. To be found guilty of this offence, the Defendants must have reasonably known, or had reason to know, of the infringement. Marco asserts that under the original licence agreement, the Defendants had both the right and ability to supervise the copying of Marco’s artwork, but nevertheless failed to prevent infringement. The Defendants also benefited financially as a direct result of the infringement by other parties, and therefore must have known of the illegal copying in the first instance.

It is interesting to note that Marco is not seeking any damages in respect of harm done to his reputation. By his own admission, Marco has previously collaborated with big names in the music industry, as well as freelance work for record labels and bands. Rather, Marco is suing C3 because of the ways in which his artworks were used in contravention to the original licence agreement. No matter the payments or promotion involved, it is important to remember that permission to use artwork usually comes with very specific strings attached.

All the Stars and Constellations

A music video for the new Black Panther film features scenes of striking similarity to artist Lina Iris Viktor’s Constellations series. Is this inspiration or infringement?

Marvel Studios’ new movie Black Panther features the first black superhero to appear in mainstream comics. It has received widespread acclaim and press, not least because of its positive portrayal of Africans and African Americans as powerful, heroic characters. In its review, The New York Times exclaims that the film “is a vivid re-imagination of something black Americans have cherished for centuries — Africa as a dream of our wholeness, greatness and self-realisation.”

To promote the film and its soundtrack, American rapper and songwriter Kendrick Lamar, together with American R&B singer SZA, recently released a music video entitled “All the Stars.” However, the producers of the music video are now accused of stealing from African artists.

British-Liberian artist Lina Iris Viktor, who currently resides in New York, has garnered praise for her series Constellations. The work is characterised by unique patterning, using what Viktor considers a “purist colour palate” of only black and 24-karat gold. Viktor found out about the music video from friends, who had called her to say they had seen Constellations featured in the video. The alleged infringement begins three minutes into the video, and lasts for about 20 seconds.

a screen shot of the “All the Stars” music video

Viktor’s lawyer Christopher Robinson sent a letter to Lamar’s mentor and label head, Anthony Tiffith of Top Dawg Entertainment. In the letter, as seen and reported by The New York Times, the use of Viktor’s artworks in the “All the Stars” video constitutes “willful and egregious” copyright infringement. In particular, the video “incorporates not just the immediately-identifiable and unique look” of Viktor’s work, but also “many of the specific copyrightable elements in the Constellations paintings.”

Viktor was previously contacted on two separate occasions in respect of using her work in association with Black Panther. In the first instance, a set decorator asked Viktor directly if he could feature Constellations in the film itself. On the second occasion, a public relations firm contacted the Mariane Ibrahim Gallery in Seattle, which represents Viktor. The PR firm wanted Viktor to provide Marvel Studios and Disney with artworks to promote Black Panther. In both instances, Viktor declined the opportunity to be associated with the film, for reasons apparently related to financial terms and exclusivity.

Lina Iris Viktor, pictured here with her artwork for House & Leisure Magazine

Constellations and “All the Stars” call into question the fine line between infringement and inspiration. Style and general colour schemes are not protected by copyright law, regardless of the form in which it is illustrated or embodied (17 USC Section 102(b)).

Segments of Kendrick’s music video clearly appear to have been inspired by Viktor’s artwork. There are several striking commonalities with the patterns and colour schemes used, and certain actors’ poses mimic Viktor’s portraits. One could even argue that the name “All the Stars” echoes Viktor’s Constellations title.

Inspiration is a common and important part of most creative processes. The issue of concern is whether the source of inspiration was transformed to the extent that Lamar’s video was itself “original,” or instead “derived” from Viktor’s work. To answer this question, the two artworks must be compared to determine “substantially similarity.” The legal test for substantial similarity is a subjective, factual analysis called the ordinary observer test, as developed in Peter Pan Fabrics, Inc. v. Martin Weiner Corp., (2d Cir. 1960):

The Court will analyse if the ordinary observer, unless he set out to detect the disparities between the works, would be inclined to overlook them and regard the aesthetic appeal of the two works as the same. This means looking at the overall visual effect — the total concept and feel — regardless of the individual elements that may have been changed, added or even removed.

Left, an image from the video for “All the Stars” (Universal Music Group); right, the painting “Constellation I” by Viktor (Mariane Ibrahim Gallery).

At present, no official lawsuit has been filed at court. The letter simply asks the “All the Stars” crew to discuss a resolution of Viktor’s claims, “consisting at a minimum of a public apology for the unauthorised use and a license fee.” In her interview with The New York Times, Viktor explained that these allegations are “an ethical issue” and not about monetary compensation. She noted that the film’s creators focus on black empowerment and African excellence, but at the same time appear to support what she considers cultural appropriation. Lamar, Top Dawg, Marvel Studios and Disney have not yet responded to the allegations.

In an attempt to settle this allegation as quickly as possible, and indeed – to protect the narrative of promoting African and African American artists in general – Black Panther producers may simply choose to give Viktor an apology and a considerable licence fee. Given that the film is expected to smash box office records, and the Black Panther soundtrack has likewise become a hit with audiences, coming up with compensation is unlikely to be too much of a problem.

Cisco v Arista: what next for computer programs and copyright?

Computer programs are functional, but they are also “literary works” that may be protected under copyright law. In December 2016, Arista Networks defended itself against a $335 million copyright infringement lawsuit from Cisco Systems. Cisco is now appealing the decision.

Cisco Systems, the largest networking company in the world, is trying to prevent Arista Networks from building ethernet switches which partially rely on technology copied from Cisco. Now on appeal before Federal Court in California (9th Circuit), the legal question is whether aspects of the particular technology deserves copyright protection in the first place.

ethernet switches connect devices together on a network

Copyright protects creative expressions of an idea, but not the idea itself. This “idea–expression dichotomy” therefore limits the scope of copyright protection. In an earlier blog post, The Copyright Between Oceans, I explained how the scène à faire doctrine was used as a successful defence in a copyright lawsuit regarding the novel The Light Between Oceans, and its subsequent film adaptation. When scène à faire (French for “essential scene”) is applied, common or typical plot developments are denied copyright protection. This means that broad themes, storylines and ideas which are common in a particular genre remain free for use by authors, screen writers, and other artists.

In the United States, computer programs are considered “literary works” under the Copyright Act, 17 U.S.C. § 101. Accordingly, scène à faire may be applied to preclude copyright protection from aspects of a computer program which are common or otherwise “dictated by practical realities.” Practical realities include hardware compatibility, manufacturer design, and industry practice. Arista’s defence turns on this concept.

UEFA scores goal against internet giants to prevent copyright infringement

Union Des Associations Européennes De Football (UEFA), whose members include 55 national football associations, organises some of the most famous and prestigious football competitions in Europe. Recently, UEFA obtained an injunction against the UK’s main retail internet service providers.

As a substitute for paid subscriptions to sport packages through Sky, BT and others, some football fans are instead using set-top box devices such as Kodi to connect directly to streaming servers via their IP addresses. A survey for the BBC found that 47% of adults have watched a football match through an illegal provider at least once, with 36% streaming matches at least once per month.

Infringement in this way is on the rise for two key reasons. Firstly, an increasing proportion of UK consumers mistakenly believe using devices to access unauthorised streams is lawful. Secondly, most people know they personally won’t face charges for pirating illegal streams.

UEFA therefore applied for an injunction against the internet companies themselves, relying on the principle of “online intermediary liability.” Online intermediaries are companies which provide the infrastructure and data storage to facilitate transactions over the internet. Examples of intermediaries are search engines, web hosts, and internet access and service providers (“ISPs”).

Rather than go after private users, copyright holders – such as UEFA, movie stuidos and record labels – consider corporate intermediaries to be more viable targets for lawsuits. Accordingly, if online intermediaries have actual knowledge of the copyright infringement, they may be liable for the illegal behaviour of their customers and viewers.

Services of intermediaries may increasingly be used by third parties for infringing activities. In many cases such intermediaries are best placed to bring such infringing activities to an end. — Recital 59, Information Society Directive (2001/29/EC)