Copyright Cases in 2024: A Year in Review
Over the past year, all eyes have understandably been on the various ongoing cases brought by copyright owners against generative AI companies. But while we await decisions in those cases, which we’ll cover in an upcoming blog, there were a few non-AI copyright cases decided that could have a lasting impact on copyright owners, users of copyrighted works, internet service providers and others. Below are summaries of these 2024 copyright cases, some of which will see further developments on appeal in 2025.
Hachette Book Group Inc. v. Internet Archive
Perhaps the most important copyright decision of 2024 came in September when the Second Circuit affirmed a district court decision that rejected the Internet Archive’s (IA) fair use defense for its mass unauthorized scanning and distribution of literary works. The case dates back to 2020, when the Association of American Publishers (AAP) filed a copyright infringement suit against IA on behalf of its book publisher members, asking the court to enjoin the creation and distribution of digital versions of the publishers’ books that it offered to the public through the contrived theory of “Controlled Digital Lending.” In 2023, a district court in the Southern District of New York ruled for the plaintiffs on all for fair use factors, but IA appealed to the Second Circuit.
On September 4, the Second Circuit affirmed the lower court’s decision, agreeing that all four fair use factors clearly favored the publisher plaintiffs. The court concluded that if IA’s “large scale copying and distribution of copyrighted books without permission from or payment to the publishers or authors…” were to be considered fair use, “such a holding would allow for widescale copying that deprives creators of compensation and diminishes the incentive to produce new works… [which is] not an approach that the Copyright Act permits.”
The deadline for IA to file a petition for certiorari with the Supreme Court has now passed, meaning the Second Circuit decision is the final word on the illegality of Controlled Digital Lending. The decision is not just a big win for book publishers but also for the copyright community—and, as the Court points out, the public—as it provides a clear explanation of what the provisions of the Copyright Act permit and how they relate to the incentives that drive creators to produce new works. It’s also likely to affect a lawsuit brought by record labels against IA for applying a similar infringement model to the digitization and distribution of sound recordings under its so called “Great 78 Project.” There are even aspects of the decision that provide some insight into how the Second Circuit might apply the four-factor fair use analysis to the generative AI cases that may eventually be before it, which we discuss in this blog.
Sedlik v. Von Drachenberg
In early 2024, a jury in the Central District of California surprisingly found in favor of tattoo artist Kat Von D in a copyright infringement suit brought by Jeff Sedlik in 2021 for the unauthorized use of his photograph of Miles Davis in the preparation, promotion, and creation of a tattoo of Miles Davis. Despite objective and undeniable similarities, the jury found that the tattoo and some of the images of the tattoo shown in the social media posts were not substantially similar to the photograph. Out of fifteen social media posts, the parties agreed that four contained a substantially similar laser printed copy of the photograph, and so the jury was only asked to make a fair use decision on those posts, which it held in favor of Von D. In May, Sedlik appealed the decision to the Ninth Circuit, challenging rulings, decisions, and orders on the record at hearings prior to and during the trial.
The Copyright Alliance filed an amicus brief in support of Sedlik that argues that the district court should have granted Sedlik summary judgment on two issues that were overwhelmingly in his favor—that the two works were substantially similar and that Von D’s use was commercial under the first fair use factor. It’s an important issue, as our brief explains, because of how problematic and damaging it is for artistic creators when trial courts fail to robustly rule at summary judgment on issues that are far too one-sided to be sent to a jury. Moreover, when courts fail to streamline a case by undertaking a complete and thorough analyses of complex copyright law questions, it can result (as it did in this case) in sending nuanced doctrinal questions to a confused jury and squandering plaintiffs’ resources. That’s not how our courts should handle copyright cases, and we hope that the Ninth Circuit recognizes the mistreatment and remands the case in 2025.
Sony Music Entertainment v. Cox Communications
In February, the Court of Appeals for the Fourth Circuit overturned parts of a jury verdict in Sony Music Entertainment v. Cox Communications, Inc., where the jury had found Internet Service Provider (ISP) Cox liable for $1 billion for its subscribers’ infringement of 10,017 songs owned by the plaintiffs, a group of music companies. While the court affirmed the jury’s finding of willful contributory infringement, it reversed the vicarious liability verdict and remanded for a new trial on damages, finding that the continued payment by Cox subscribers of monthly fees for internet services was not a financial benefit flowing directly to Cox from the copyright infringement itself.
In August, both Sony and Cox petitioned the Supreme Court for certiorari, asking it to review the Fourth Circuit’s holdings on vicarious and contributory liability, respectively. The question presented by Sony is “[w]hether the profit requirement of vicarious copyright infringement permits liability where the defendant expects commercial gain from the enterprise in which infringement occurs (as the First, Second, Third, Seventh, and Ninth Circuits have held), or whether the profit requirement of vicarious copyright infringement permits liability only where the defendant expects commercial gain from the act of infringement itself (as the Fourth Circuit has held).” Cox’s petition asks the court to consider a two-part question, (1) “[d]id the Fourth Circuit err in holding that a service provider can be held liable for ‘materially contributing’ to copyright infringement merely because it knew that people were using certain accounts to infringe and did not terminate access, without proof that the service provider affirmatively fostered infringement or otherwise intended to promote it?” and (2) “[d]id the Fourth Circuit err in holding that of another’s direct infringement suffices to find willfulness under 17 U.S.C. § 504(c)?”
In September, the Copyright Alliance filed an amicus brief in support of Sony’s petition, explaining that the Fourth Circuit’s interpretation of vicarious liability is inconsistent with most courts, would threaten the creative industries, and would upset the balance that Congress intended when it enacted the DMCA. The Court has not yet made a decision on either petition, but in late November, it asked the office of the Solicitor General to file a brief “expressing the views of the United States” on the petitions. While it’s not determinative of whether they will take the case, it’s clear the petitioners have the Court’s attention. If the Court does take the case in 2025, it’s sure to be a monumental showdown over secondary liability standards that could have a huge impact on how internet service providers (and others) are held accountable for the infringement of their users.
Green v. DOJ
On August 2, the U.S. Court of Appeals for the DC Circuit issued an opinion rejecting a facial challenge to the constitutionality of the Copyright Act’s prohibitions on the circumvention of technological protection measures. The case was brought as a pre-enforcement action in 2016 by the Electronic Frontier Foundation (EFF) on behalf of various putative plaintiffs, and it argued that Section 1201 of the DMCA is overly broad and unconstitutional because it restricts lawful uses of technology under the First Amendment. In 2019, the district court for the District Court of Columbia dismissed all but the as-applied First Amendment challenges, finding that the government failed to meet its burden to show that Section 1201(a) does not encumber substantially more of plaintiffs’ speech than necessary to further its interest. The district court eventually held that the government satisfied its burden under intermediate scrutiny to justify application of Section 1201(a)’s anticircumvention and antitrafficking provisions. The plaintiffs then appealed the district court’s earlier order dismissing the facial First Amendment challenges.
Rejecting those challenges, Judge Pillard explained that the plaintiff’s facial challenge “is especially disfavored because Section 1201(a) expressly regulates conduct—the circumvention of technological locks, and trafficking in means of circumvention—rather than speech.” The opinion goes on to say that the “heartland” conduct the anticircumvention and antitrafficking provisions criminalize is piracy of digital property, which is “a modern form of theft.” Addressing the claim that the triennial rulemaking process itself is an unconstitutional burden on its beneficiaries’ speech, the court found it unpersuasive and notes “an irony of appellants’ challenge to the DMCA is that the triennial rulemaking exemption scheme—which identifies in advance and immunizes categories of likely fair uses—may be less chilling of the fair uses to which it applies than the after-the-fact operation of the fair use defense itself.”
The appeals court decision brings to an end nearly a decade of litigation during which the EFF threw the kitchen sink at the anticircumvention provisions of the DMCA. But their arguments were rejected at every turn, as the various courts not only confirmed the constitutionality of Section 1201 but reiterated the legitimacy and effectiveness of the triennial rulemaking process.
Warner Chappell Music v. Nealy
Lastly, it wouldn’t be a yearly copyright case roundup without mentioning the only copyright case the Supreme Court heard in 2024. While maybe not as intriguing as generative AI or fair use cases, the Warner Chappell Music v. Nealy addressed a circuit split as to whether the Supreme Court’s 2014 Petrella v. Metro-Goldwyn-Mayer, Inc. decision categorically bars damages for copyright infringements occurring more than three years before a lawsuit. In 2023, music publishers filed for cert after the Eleventh Circuit found that defendants in copyright infringement cases can be held liable for actions that occurred prior to the three-year statute of limitations for filing such litigation. The question presented to the Court was whether, under the discovery accrual rule applied by the circuit courts and the statute of limitations for civil actions under Section 507 of the U.S. Copyright Act, a copyright plaintiff can recover damages for acts that allegedly occurred more than three years before the filing of a lawsuit.
In a 6-3 decision written by Justice Kagan, the Court found that there is no time limit on monetary recovery when a copyright owner possessing a timely claim is entitled to damages, no matter when the infringement occurred. Importantly, the Court did not directly address the discovery rule, explaining that the issue was “not properly presented” and stating that “we assume without deciding that a claim is timely under [§507(b) of the Copyright Act] if brought within three years of when the plaintiff discovered an infringement, no matter when the infringement happened.” In his dissent, Justice Gorsuch stated that “rather than devote our time to this case, I would have dismissed it as improvidently granted and awaited another squarely presenting the question whether the Copyright Act authorizes the discovery rule.” In fact, the discovery rule was squarely presented to in Hearst Newspapers v. Antonio Martinelli, but the cert request in that case was denied shortly after the Warner Chappell decision. At least for now, the circuit split on the discovery rule lives on.
Conclusion
2024 was largely a good year for copyright owners in the courts. While the Sedlik case left many scratching their heads over substantial similarity, the Hachette and Green cases set the record straight on fair use and the constitutionality of the DMCA’s anticircumvention provisions. Along with the inevitable AI decisions coming down the pike, 2025 is set to be another busy year in copyright litigation. In addition to developments in the Sony and Sedlik cases, there are a few other ongoing cases that might be decided in 2025, including UMG v. Internet Archive, which is the aforementioned case that will likely be impacted by the Hachette decision. Let’s hope it’s a good year for copyright owners and for the copyright laws creators rely on.
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