It’s easy to appreciate why the MPAA and other groups that support tougher anti-piracy laws are so eager to circulate the report out today from the International Intellectual Property Alliance. It buttresses their case by showing that the national economy increasingly depends on industries that make and distribute content including computer software, movies, TV shows, video games, books, magazines, and newspapers. Their contribution to GDP crossed the $1T mark for the first time in 2012 (at $1.02T, a 5.2% increase vs 2011), accounting for nearly 6.5% of the national total, up from 6.4%. Last year’s growth is a little less impressive if you adjust for inflation: The copyright total was up 3.9%, slower than the previous year (when it was +6.1%) and 2010 (+4.2%). Even so, copyright-protected businesses added more value to GDP last year than construction (at $558.7B) and the federal government ($668.3B) — and came close to health care and social assistance ($1.16T), finance and insurance ($1.24T), and state and local government ($1.36T). Employment in copyright businesses also edged up. They accounted for 5.4M jobs in 2012, +1.9%. That comes to 4.04% of total U.S. employment, and 4.83% of private employment. At the same time, average compensation per employee rose 3.25% to $85,643 — that’s 33% more than the U.S. average, and 39% higher than the private industry average. The study stuck to a long-used formula for calculating the industry’s contribution to GDP instead of adjusting …
2ND UPDATE, 12:30 PM: The contempt of court ruling leveled against FilmOn on Tuesday is quickly turning into a battle outside the courts as well. Today plaintiff CBS told me that it did not withhold any licensing agreement from FilmOn from the court because it never received one – despite what the streaming service’s lawyer says. Last night, after I reported on the contempt of court ruling against FilmOn and its CEO Alki David, attorney Ryan Baker contacted me to say he had given the document requested by the court to CBS counsel on August 20 but the network never made that known to the federal court. Baker alleged that such a failure of notification led Judge Naomi Reice Buchwald to make the contempt of court ruling on Tuesday. CBS clearly begs to differ. Read their statement here:
No wonder this lawyer’s client was held in contempt. The court held a complete hearing on this subject and no licensing agreement was produced by either this lawyer or his client. Of course no such agreement exists. Would not this lawyer produce such an agreement to the court if it did? The client failed to produce such an agreement, the lawyer failed to produce such an agreement and the court pointed this out in its opinion (see, pages 20-21 of the opinion). CBS has never received or for that matter even seen such a so-called executed licensing agreement. Talk of diversionary tactics. This is sour grapes so strong that the fermentation has already begun. They lost, period.
UPDATE, 12:04 PM: The MPAA says that today’s Supreme Court decision “will hinder American businesses’ ability to compete overseas to the detriment of the long-term economic interests of the United States, and particularly its creative industries.” The trade group adds that it will “study the decision further before determining the most appropriate action for us to take.”
PREVIOUS, 9:55 AM: The 6-to-3 decision just handed a big defeat to the MPAA and other content providers by potentially undermining companies’ ability to charge different prices for books, CDs, DVDs, software, video games and other works in different countries. In the case, Kirtsaeng v John Wiley & Sons, entertainment companies sided with the book publisher against an entrepreneurial Thai college student studying in the U.S. Supap Kirtsaeng discovered that textbooks cost far less in Thailand than in the U.S. He turned that into a business, importing textbooks that he re-sold here for less than the publisher charged. Wiley said that violated its copyright; Kirtsaeng said it complied with the first-sale doctrine that enables people to freely re-sell content that they’ve bought. The MPAA and RIAA said in a brief supporting Wiley that extending the first-sale doctrine to works sold abroad “could impede authors’ ability to control entry into distinct markets, limit their flexibility to adapt to market conditions, or undermine territorial licensing agreements.”
Less than two months before The Expendables 2 comes out, Sylvester Stallone today scored an action hero legal victory. Judge Jed Rakoff rejected Marcus Webb’s claims that The Expendables was his original idea and Sly stole it. Webb sued Stallone, the retro action flick’s co-author David Callaham, Millennium Films, Nu Image Films and Lionsgate in late October 2011. In his initial suit, Webb said he circulated a script several years ago among studios about “elite highly trained mercenaries” recruited to defeat a dictator. Webb alleged that the screenplay for The Expendables is “strikingly similar and in some places identical” to his The Cordoba Caper. Webb claimed that Stallone, who directed, co-wrote and starred in The Expendables, and his team must have seen his script because they were so alike. The Rocky star’s lawyers said that was unlikely especially being that one was an action movie and Webb’s was more of a caper flick. The lawyers also pointed out that Callaham had already written several drafts of what was to become 2010’s The Expendables before Webb’s script was even out there. The judge, who said a more formal order would be forthcoming, obviously agreed. The Expendables 2 comes out on August 17, 2012.
The federal criminal copyright case against Megaupload founder Kim DotCom in the United States may never go to trial because although DotCom has been served with court papers, his file-sharing company hasn’t, according to a New Zealand newspaper’s coverage of the case in the U.S. Federal judge Liam O’Grady said he didn’t know if “we are ever going to have a trial in this matter” after he was informed Megaupload had not been served with criminal papers. Dotcom’s U.S.-based attorneyIra Rothken said “We don’t believe Megaupload can be served in a criminal matter because it is not located within the jurisdiction of the United States.” Prosecutor Jay Prabhu told the Virginia court hearing that might not matter because Dotcom owned 68% of the company. Instead of a corporation that might show up for a trial, Prabu suggested it was a case “seven people who actually don’t want to show up.” Dotcom faces a court hearing for extradition to the United States after a warrant was issued for him and six others on criminal copyright charges relating to music and movies on its computer servers. O’Grady raised the possible lack of a trial during arguments over FBI applications to wipe Megaupload’s vast database of members’ files. O’Grady said those motions to erase the data on 1100 computer servers seized from Megaupload could be “premature” and requested more information on why Megaupload …
The 6-2 U.S. Supreme Court decision favors content owners including Hollywood studios over an unusual coalition of public interest and Internet activists including Google. At issue was whether the federal government had the right in 1994 to pass a law that extended copyright protection to works that were already in the public domain. Lawmakers acted to sync U.S. copyright law with other countries’ rules as part of a broad trade agreement known as the Uruguay Round. But the change meant that public groups lost access to works including Alfred Hitchcock’s 1932 film Number Seventeen, J.R.R. Tolkien’s The Hobbit, Prokofiev’s “Peter and the Wolf” — and about 1 million books that Google said it wanted to make available online. Those challenging the change said that the government had trampled on the First Amendment without a compelling reason. But the Supreme Court justices deferred to Congress’ right to decide the national interest. The MPAA was pleased: The ruling “demonstrates that the United States fulfills its international copyright obligations and will remain a world leader in protecting creative works, thereby helping foster their continued creation and dissemination,” Chief Policy Advisor Fritz Attaway says.
The U.S. Supreme Court denied an appeal by NBUniversal to review a lower court ruling that reinstated a complaint alleging that the company’s NBC network stole the idea for its Syfy series Ghost Hunters. Parapsychologist Larry Montz and publicist Daena Smoller had claimed in a 2006 suit that between 1996 and 2003 they had pitched the idea of paranormal investigators using technology to investigate claims of haunted properties to entertainment companies including NBC and its subsidiary, then called the SciFi Channel. They lost in district court on the issue of copyright, but the case was reinstated on appeal on grounds of implied breach of contract. NBCUniversal, with the backing of the MPAA, argued to the Supreme Court that federal copyright law trumped state contract law. The high court on Monday declined to review the appeals court ruling, which allows the suit by Montz against NBCUniversal, Pilgrim Films & Television (which produces Ghost Hunters) and other defendants to proceed.
Sylvester Stallone has been sued by a writer who alleges the hit movie The Expendables copies a script and short story he filed with the U.S. Copyright Office in 2006. Marcus Webb says he then made available to Hollywood studios a script about mercenaries recruited to defeat a dictator named General Garza. Webb alleges in the suit filed in federal court in Manhattan that the screenplay for The Expendables is “strikingly similar and in some places identical” to his The Cordoba Caper. Webb seeks unspecified damages and a court order stopping further infringement by Stallone, his credited co-author David Callaham, Millennium/NuImage Films and Lionsgate. Expendables 2 is slated to open August 17, 2012.
Viacom and Google/YouTube were back in court Tuesday arguing over last year’s federal district court ruling that relieved YouTube and its parent Google of massive copyright infringement charges, Bloomberg reported. Viacom told a panel of three judges in the court of appeals in Manhattan that the lower court should have let a jury hear the case in which YouTube was accused of allowing users to upload videos of Viacom shows South Park and The Daily Show With Jon Stewart” and other shows as well as movies from Paramount Pictures. Viacom’s attorney said YouTube willfully ignored copyright violations by users posting video clips without authorization. That unauthorized content, Viacom argued, fueled the company’s rapid growth and Google eventually bought YouTube for $1.65 billion. YouTube pointed out that Viacom also had been a suitor and it was only after negotiations broke down and Google made the winning bid that Viacom sent the legally required takedown notices for infringing videos. YouTube’s lawyer told the appellate court panel it removed infringing videos as soon as it was notified by copyright owners. On that basis, U.S. District Judge Louis Stanton ruled last year that YouTube was protected from liability under the “safe harbor” provision of the Digital Millennium Copyright Act.
The judges appeared skeptical of sending the case back to a jury for trial, PaidContent said, …
The MPAA filed a copyright-infringement lawsuit in Los Angeles today against operators of the movie-streaming service Zediva, which the movie studio organization says illegally streams movies to its customers without obtaining required licenses, a violation of the studios’ right to “publicly perform” their works. Zediva claims it is like a brick-and-mortar DVD “rental” store and therefore not obligated to pay licensing fees to copyright holders. But the MPAA says Zediva is a video-on-demand service that transmits movies over the Internet using streaming technologies in violation of the studios’ copyrights. “Zediva’s mischaracterization of itself is a gimmick it hopes will enable it to evade the law and stream movies in violation of the studios’ exclusive rights,” said Dan Robbins, SVP and Associate General Counsel for the MPAA. “Courts have repeatedly seen through the façade of this type of copyright-avoidance scheme, and we are confident they will in this case too.”
EXCLUSIVE: Today Lois Lane was cast for Warner Bros’ Superman movie reboot. So it’s fitting to note that, on February 12th, the widow of Superman co-creator Jerome Siegel died of heart failure in a Los Angeles hospital at age 93. While much has been made of the fact that she was the model for Lois Lane, Joanne Siegel also was a driving force along with the estate of Joe Shuster to recapture the entire original copyright to Superman. The Siegel heirs have already been awarded half the copyright for Superman. And in 2013 the Shuster heirs get the remaining half. After that, neither DC Comics nor Warner Bros will be able to use Superman without a financial agreement with the Siegels and Shusters. There are also stipulations on what parts of the origins story can be used in future Superman movies and which require re-negotiations with the creators’ heirs or estates. But Warner Bros keeps fighting the Siegel and Shuster heirs and last May seized on a new hardball strategy: to force their attorney Marc Toberoff to resign by filing a lawsuit in federal court in Los Angeles raising questions about his alleged role as a financial participant in the Superman copyright. Before her death, Joanne Siegel was preparing the following letter obtained by Deadline:
December 10, 2010
Jeffrey L. Bewkes
Chairman and Chief Executive Officer
Time Warner Inc.
I am Joanne Siegel widow of Jerry Siegel, creator of Superboy and co-creator of Superman with Joe Shuster. It has always been my policy to be in touch with the Chairmen of the Board of your company going back to when Steve Ross formed Warner Communications.
Steve Ross knew how to take care of large vexing problems. He paid the price, whatever it was, then went on, and the company prospered. He was gracious and friendly when my late husband Jerry and I met him at a stockholders meeting after he sent Jerry, Joe, my daughter Laura and me company stock. He also phoned me to say if we needed anything I should just pick up the phone and call him. He said if he could not be reached for some reason, one of the top officers in the company, Deane Johnson, would handle things personally. Laura and I believe if Steve were alive our copyright ownership matter would have been successfully resolved long ago.
Jerry Levin was also reachable and thoughtful. He sent my husband and later me, cases of grapefruit at the holiday season. He remembered Jerry’s birthday with a Superman sculpture. When my Jerry passed away, Jerry Levin told Laura and me that we are part of the Time Warner family, part of its history. Unfortunately he retired before our rights issues were resolved. He had given his attorneys too much power so that negotiations were unsatisfactory and a settlement was impossible. Dick Parsons, on the other hand, was not friendly and, under him, the attorneys hired by the company were arrogant and pro-litigation.
Now you are Chairman and CEO. Because we are in litigation I held off writing to you. I now believe had we had contact early on, things might not have gone so far off track.
My daughter Laura and I, as well as the Shuster estate, have done nothing more than exercise our rights under the Copyright Act. Yet, your company has chosen to sue us and our long-time attorney for protecting our rights.
On December 1st I turned 93. I am old enough to be your mother. I have grown grandchildren. Unfortunately I am not in the best of health. My cardiologist provided a letter to your attorneys informing them that I suffer from a serious heart condition and that forcing me to go through yet another stressful deposition could put me in danger of a heart attack or stroke. I am also on medications that have side effects which force me to stay close to home and restrooms. Nonetheless your attorneys are forcing me to endure a second deposition even though I have already undergone a deposition for a full day in this matter. As clearly they would be covering the same ground, their intention is to harass me.
My dear daughter Laura too has painful medical conditions including multiple sclerosis, arthritis, glaucoma, spine disorders, and fibromyalgia. She has already had her deposition taken twice by your attorneys while in pain. Her doctors have given written statements saying she should not be subjected to a third deposition, yet your attorneys are insisting on re-taking her deposition in an effort to harass her as well.
So I ask you to please consider – do these mean spirited tactics meet with your approval? Do you really think the families of Superman’s creators should be treated this way?
As you know, DC and Warner Bros. have profited enormously from 72 years of exploiting Jerry and Joe’s wonderful creation. Superman is now a billion dollar franchise and has been DC’s flagship property for all this time.
As for this letter, the purpose is three-fold: