August 2023 Roundup of Copyright News

In August, the courts were ablaze with issuing big decisions in several major copyright cases, including one on AI and copyright authorship. Here is a quick snapshot of the copyright-related activities that occurred during the month of August as well as a few events to look forward to in September.  

Copyright Alliance Activities

Copyright Alliance Blogs: We published several blogs in August:  

  • The Barbie movie made a splash this summer, and Copyright Alliance CEO, Keith Kupferschmid, wrote this blog post highlighting how copyright laws helped protect and propel this beloved doll into a cultural icon.
  • We published a three-part blog series on movie copyright cases that filmmakers should know, exploring Infringement Cases, Fair Use Cases, and Copyright Authorship.
  • In time for back-to-school, we published this blog post on four tips for educators to navigate copyright law.

CCB Status Update: At the end of August 2023, 557 total cases had been filed with the Copyright Claims Board (CCB). Of these claims, 217 are “smaller claims.” In at least 159 of all cases, the claimant is using legal counsel. At least 475 of the cases involve infringement claims, 91 involve Section 512(f) misrepresentation claims, and 18 involve claims for declarations of noninfringement. The eCCB docket currently shows that the works at issue in these cases are as follows: Pictorial Graphic & Sculpture (239 cases); Literary Works (86); Motion Picture and Audiovisual Works (108); Sound Recordings (64); Musical Works (36); and some cases include claims for multiple works. Sixty-one foreign residents have filed claims. Of all the cases filed, 379 have been dismissed for the following reasons: Due to Respondent’s Opt Out (48); Due to Failure to Amend Noncompliant Claim (206); Registration Issues (10); Due to Failure to Provide Proof of Service of Process (77); Claimant Withdrawal and Dismissal of Claims (31); and Settlement (5). There are 49 active proceedings and four final determinations.  

USCO Requests Comments on AI Study: On August 30, the Copyright Office published a notice of inquiry and request for comments in the Federal Register for its Artificial Intelligence and Copyright study. The notice seeks comments to help the Office assess whether legislative or regulatory steps are warranted and to inform the Office on issues involving the use of copyrighted works to train AI models, the appropriate levels of transparency and disclosure with respect to the use of copyrighted works, and the legal status of AI-generated outputs. The deadline for submitting comments is October 18, 2023, and reply comments is November 15, 2023.  

CRB Issues Final Determination for Phonorecords Royalties: On August 10, the Copyright Royalty Board (CRB) announced a final determination after the district court for the District of Columbia had vacated and remanded part of a CRB’s determination of rates and terms for making and distributing phonorecords for the period beginning January 1, 2018 and ending on December 31, 2022 (Phonorecords III). The determination includes a rate increase from 10.5% to 15.1% for on-demand streaming. More information is available here.  

USCO Publishes Final Rule on Ex Parte Communications: On August 11, the Copyright Office published a final rule on the procedures governing the use of ex parte communications in informal rulemakings, including the instructions for requesting ex parte meetings and identifying impermissible ex parte communications. The final rule largely memorializes existing procedures for ex parte communications but incorporates a few changes/clarifications including clarifying that ex parte communications include those communications that occur after the commencement of a rulemaking, whether the rulemaking process begins with the publication of an NPRM or another Federal Register notice, such as an NOI.  

USCO and LOC Provides Updates on Copyright Office Modernization Efforts: On August 16, the Library of Congress and Copyright Office hosted a Copyright Public Modernization Committee meeting which featured the progress made in modernization efforts to the Copyright Office’s online services and systems. In her opening remarks, Register Shira Perlmutter provided updates on the Copyright Office’s activities including the initiation of the latest rulemaking proceeding of section 1201 exemptions, preparing for the next fee study, intensifying work on AI issues, and progressing on the Electronic Copyright System. The modernization team presented updates and features including a feature which directs registrants to choosing the correct application form by asking a series of questions, standardizing displays for forms in the limited licenses that the Copyright Office administers, and digitizing many more analog historical records for the public. A recording of the meeting will be uploaded to the Copyright Office’s Modernization Website.  

USCO Declines to Conduct a Study on Section 115 Compulsory Licenses: The Copyright Office responded to a June letter penned by musician, George Johnson, declining to engage in a new study of the section 115 compulsory mechanical license. The Office noted that such a study was premature given the recent enactment of the Music Modernization Act.  

Biden Administration Activities 

USPTO Receives Comments for Study on Anti-Piracy: The U.S. Patent and Trademark Office (USPTO) received 54 comments in response to its request for public comments on its study titled: Future Strategies in Anticounterfeiting and Antipiracy. The comments were originally due on August 23, but the USPTO informally announced two days after the deadline, that the comment period had been extended to September 25, and formalized this announcedment in a Federal Register notice on August 31. The USPTO received 54 comments in total and will hold a public roundtable on the issues on October 3. The Copyright Alliance submitted comments addressing a range of copyright piracy issues, including the need for better education for consumers, the ineffectiveness of certain provisions of the DMCA, and the need for the adoption of site-blocking mechanisms in the U.S. Many others also filed comments including the American Association of Independent Music, UFC, NBA, and NFL, the Motion Picture Association, Association of American Publishers, Entertainment Software Association, and the U.S. Copyright Office.  

Senate Majority Leader Schumer to Hold AI Insight Meeting: According to reports, Senator Chuck Schumer (D-NY) will hold the first scheduled “Insight Forum” on AI issues on September 13, which will be closed to the press. The forum will includes a list of speakers from the tech and creative industries including, Mark Zuckerberg, CEO of Meta, Sam Altman, CEO of OpenAI, Jensen Huang, CEO of NVIDIA, Satya Nadella, CEO of Microsoft, Elon Musk, Tesla CEO, Sundar Pichai, CEO of Alphabet, and Charles Rivkin, Motion Picture Associaiton Chairman & CEO.  

Parties Submit Proposed Consent Judgment in Publishers’ Lawsuit Against Internet Archive: On August 11, the district court for the Southern District of New York issued an order accepting a joint proposal submitted by Hachette Book Group, HarperCollins Publishers, Penguin Random House, and Wiley (the “Plaintiffs”), together with the Internet Archive (IA) regarding the judgment to be entered in Hachette Book Group, et al., v. Internet Archive. In March 2023, the court had found IA liable for copyright infringement for scanning and distributing digital copies of Plaintiffs’ books and rejected IA’s fair use defenses. The proposed consent judgment provided for a stipulated permanent injunction preventing IA from offering unauthorized copies of the Plaintiffs’ books to the global public under the manufactured theory of “controlled digital lending,” and included a confidential agreement on a monetary payment, all subject to Internet Archive’s right to appeal the case. However, the court clarified that the injunction would only apply to the publishers’ print books which were also were available for electronic licensing.  

Court of Appeals Rules USCO’s Enforcement of Section 407 Mandatory Deposits is Unconstitutional: On August 29, the Court of Appeals for the District of Columbia Circuit issued an opinion in Valancourt Books, LLC v. Garland, et al., finding that the way the U.S. Copyright Office enforced Section 407 for physical copies of Valancourt’s works, amounted to an unconstitutional taking of Valancourt’s property. Section 407 of the Copyright Act requires copyright owners to deposit two copies of the work with the Library of Congress within three months of its publication, and was a provision enforced by the Copyright Office via demand letters to have noncompliant owners comply with the provisions or pay a fine. The court found that “because the requirement to turn over copies of the works is not a condition of attaining (or retaining) copyright protection in them, the demand to forfeit property cannot be justified as the conferral of a benefit—i.e., copyright protection—in exchange for property.”  

Record Labels Sue Internet Archive: On August 11, Universal Music Group, Sony Music Entertainment, Capitol, and other record labels filed a lawsuit against the Internet Archive, alleging copyright infringement of 2,749 pre-1972 sound recordings for the mass digitization and distribution of those songs as part of the Internet Archive’s “Great 78 Project.” Through the project, the Internet Archive digitizes sound recordings fixed in physical 78 rpm records and uploads the files to a webpage that allows users to stream and download the recordings.  

DC District Court Rules that AI-generated Art Is Not Protectable by Copyright: On August 18, Judge Howell of the US District Court for the District of Columbia issued an opinion granting the U.S. Copyright Office’s motion for summary judgment in Thaler v. Perlmutter, a case challenging the Office’s denial of registration for a two-dimensional artwork generated by an AI algorithm called the “Creativity Machine.” Granting the Copyright Office’s motion and denying Thaler’s, the order explains that “defendants are correct that human authorship is an essential part of a valid copyright claim” and “a bedrock requirement of copyright.” The court also denied Thaler’s claim that the Copyright Office’s refusal to register the work was “arbitrary and capricious”—and therefore a violation of the Administrative Procedures Act (APA)—finding that “the Register did not err in denying the copyright registration application.” Thaler’s counsel said that they plan to appeal the decision.    

OpenAI Moves to Dismiss Class Action Lawsuit: On August 28, OpenAI filed motions to dismiss the two class action lawsuits brought by book authors, including Paul Tremblay and Sarah Silverman. In both briefs, OpenAI argues against the plaintiffs’ characterization that every ChatPGT output is an infringing “derivative work” of the plaintiffs’ books, stating that the plaintiffs did not sufficiently prove substantial similarity. The AI company also argued that the vicarious copyright claims should also be dismissed, stating that the plaintiffs did not show that OpenAI had the right and ability to supervise any infringing conduct nor did they show that OpenAI had a direct financial benefit resulting from the infringements.  

SoundExchange Sues SiriusXM Alleging Underpayment of Recording Artist Royalties: On August 16, SoundExchange filed a lawsuit against SiriusXM in the Eastern District of Virginia, alleging that the satellite radio company undercompensates recording artists because it overcounts its share of revenue that comes from webcasting, resulting in a lower gross revenue amount for the company’s satellite broadcasting to calculate royalties payable to recording artists. As a result of SiriusXM’s calculations, the complaint alleges that the company withheld more than $150 million in royalties.  

Court Denies Apple’s Petition for a Rehearing in Case Against Corellium: On August 23, the Court of Appeals for the Eleventh Circuit denied a petition made by Apple for a rehearing en banc of the court’s ruling that the reproduction of Apple’s iOS by the software company, Corellium, qualified for the fair use exception. Apple argued that the court’s decision conflicted with the Supreme Court’s opinion in the Andy Warhol Foundation v. Goldsmith, which was issued days after the Eleventh Circuit had ruled in favor of Corellium. However, the court stated that after carefully reviewing the High Court’s Warhol opinion, it did not alter the balance of the four factors that they weighed in favor of fair use.  

Triller and Sony Music Entertainment Settle Lawsuit: On July 21, Sony Music Entertainment and Triller entered into a confidential settlement, resolving the infringement lawsuit brought by Sony Music for Triller’s breach of an agreement covering the platform’s use of Sony musicians’ songs. In April 2023, Triller had settled a portion of the lawsuit, agreeing to pay Sony Music $4.57 million for contract breaches. Triller is in the midst of another active lawsuit filed by Universal Music Group in January 2023.  

The New York Times Considers Lawsuit Against ChatGPT Maker: According to reports, The New York Times is considering filing a lawsuit against OpenAI, the developers of ChatGPT. The parties were reportedly in contentious negotiations for a licensing deal in which OpenAI would use The Times’ news content for AI tools.  

Court Awards DISH Network and Sling Half Billion Dollars in DMCA Piracy Lawsuit: On August 14, the district court for the Southern District of Texas entered a default judgment for plaintiffs, DISH Network and Sling TV, and awarded almost $500 million in statutory damages for over 2 million violations of the Digital Millennium Copyright Act’s (DMCA) anti-circumvention provisions.  

Books3 AI Training Dataset Is Taken Down: According to reports, Danish anti-piracy group, Rights Alliance, successfully submitted a takedown notice on behalf of Danish publishers to remove the “Books3” dataset from the website, The Eye. First released in late 2020, the Books3 dataset is a plaintext collection of 196,640 books sourced from the pirate site, Bibliotik, and has been used to train various generative AI models developed by Meta and possibly other AI companies.

UK Culture, Media and Sports Committee Calls on UK Government to Abandon Proposed Overbroad TDM Exceptions: On August 30, the United Kingdom’s House of Commons Culture, Media and Sport Committee issued a report, calling on the UK Government to abandon its proposal from June 2022 to categorically exempt text and data mining of copyrighted works under the country’s copyright laws. The Committee further recommended that the UK government work to facilitate mutually beneficial licensing schemes to support small AI developers in particular, and that the government should continue to support the creative community and “work to regain the trust of the creative industries following its abortive attempt to introduce a broad text and data mining exemption.”

UK Courts Grant Site Blocking Orders: According to reports, the High Court in London granted broadcaster, Sky, and the Premier League injunctive orders that would allow the rights holders to block IPTV and other pirate services and sources that illegally stream and provide access to soccer games and other content.  

Industry Activities 

YouTube Music Launches MusicAI Incubator with Universal Music Group; Publishes AI Music Principles: On August 21, YouTube Music published a set of AI music principles and launched its YouTube Music AI Incubator in partnership with Universal Music Group. The principles include: (1) Responsible AI development in partnership with the music industry; (2) Protecting the creative work of artists on YouTube; and (3) Scaling trust and safety policies to protect the YouTube community. Universal Music Group chairman and CEO, Sir Lucian Grainge, stated: “Today, our partnership is building on that foundation with a shared commitment to lead responsibly, as outlined in YouTube’s AI principles, where Artificial Intelligence is built to empower human creativity, and not the other way around,” he added. “AI will never replace human creativity because it will always lack the essential spark that drives the most talented artists to do their best work, which is intention. From Mozart to The Beatles to Taylor Swift, genius is never random.” More information is available here.  

Rights Holders Pen Letter Calling on Global Leaders to Support IP Rights: On August 9, news media companies and rights holder groups around the globe, including Getty Images, National Press Photographs Association, News Media Alliance, and the Authors Guild published an open letter, urging lawmakers to consider regulations and industry action surrounding generative AI that increases transparency, promotes the pursuit of consent from rights holders for use of works for AI training purposes, facilitates collective negotiations regarding the terms of AI providers access and use of works protected by intellectual property, and requires AI providers to remove bias and misinformation from services. More information is available here.  

Look Forward To And Save the Date For…

IPO 2023 Annual Meeting: From September 10-11, the Intellectual Property Owners (IPO) Annual Meeting will offer “a mix of educational programs featuring leaders in the IP industry, committee meetings, networking opportunities, sponsors, exhibitors, and more.” The event brings together IP professionals from around the world to discuss strategies, trends, and best practices. More information is available on the registration page.  

Copyright Alliance AI and Copyright Webinar: On September 13 from 1:00-2:00 p.m. ET, the Copyright Alliance, along with numerous VLA and Community Partners, is hosting a webinar titled, Artificial Intelligence and Copyright: The Next Frontier. This event will explore the complex relationship between copyright and artificial intelligence (AI). Specifically, it will cover how AI has transformed creative processes and delve into the legal and ethical implications surrounding copyright ownership, licensing, fair use, and other opportunities and challenges brought on by the AI revolution. Legal experts from the Copyright Alliance, Kevin Madigan and Rachel Kim, will host the webinar. More information is available on the registration page.  

Copyright + Technology Conference 2023: On September 14 from 9:00 a.m.- 5:00 p.m. ET, the Copyright Society, GiantSteps Media, and Fordham University School of Law are hosting their annual Copyright and Technology Conference, which will “focus on the dramatic and fast-moving influences that technology has on copyright in the digital age.” Now in its fourteenth year, the conference is attended by technologists, attorneys, media industry practitioners, and public policy decision-makers to discuss topics related to copyright and technology. This year’s keynote speaker is Pina D’Agostino, a Professor at Osgoode Hall Law School. More information is available on the registration page.  

WIPO Conversation on Generative AI and IP: From September 20 from 4:00 a.m.- September 21 4:00 a.m., the eighth session of the World Intellectual Property Organization’s (WIPO) conversation series will explore the intersection of generative artificial intelligence (AI) and intellectual property (IP) rights. More information is available on the registration page.  

USCO Monthly Recordation System Webinar: On September 28 at 1:00 p.m. ET, the U.S. Copyright Office will hold its next monthly webinar to keep the public updated on the Office’s optimized Recordation System. Separate from the Office’s registration application, the new recordation module allows users to electronically transfer their copyrights to someone else. The webinars will “cover announcements about the module, important reminders, frequently asked questions, and a live Q&A session.” More information is available on the registration page.

If you aren’t already a member of the Copyright Alliance, you can join today by completing our Individual Creator Members membership form! Members gain access to monthly newsletters, educational webinars, and so much more — all for free!

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