A child posted a photo on his Instagram account of himself and a cousin wearing 1 Hotel branded robes at one of their hotels. 1 Hotel commented on the post stating: “We love this photo! Reply to this comment with #sharemy1pic if you’re happy with us sharing your photo on our social channels.” The child’s account responded: “@1hotels thank you! #sharemy1pic.” 1 Hotel then used the photo on its Instagram account. It later also posted the photo on its website to sell the robes in the photo.

Two years after the photo was posted, the plaintiffs obtained a copyright registration for the photo. The plaintiff later filed a lawsuit against 1 Hotel in the Central District of California, alleging (among other things) that the hotel’s use of the photo constituted copyright infringement and unauthorized use of the child’s likeness. The hotel then filed a motion to dismiss.

All causes of action were dismissed for different reasons, but some will likely be revived because the plaintiffs were given the opportunity to amend a few of them so that they were passable under the applicable pleading standards. Importantly though, the court substantively determined that the exchange between the plaintiff and hotel on Instagram created an “implied license” to use the photo on the hotel’s “social channels.” (It’s not clear why the license was implied, rather than express.) However, the court found that the hotel may have exceeded the scope of that license by using the photo to sell robes on its website since the exchange never mentioned that. Accordingly, the court denied the hotel’s motion to dismiss the copyright claim on substantive grounds, because there is a material issue of fact as to whether the implied license extended to the sale of robes on a website.

The hotel sought to dismiss the misappropriation claim related to use of the minors’ likenesses by arguing (1) that the plaintiffs consented to the use of the photo, (2) the use was incidental, and (3) the children are not readily identifiable. The court rejected the first argument for the reasons mentioned above. Although the hotel may have had consent to post the photo on its social channels, it may not have had consent to post it on its website. The court also easily found that the use was not incidental and that the children were readily identifiable.

The causes of action referenced above may be litigated further if the Plaintiffs submit an Amended Complaint, but this present decision still includes some helpful lessons for companies that want to use content they find on social media. First, although getting a signed release is likely always the safest approach, companies can likely get consent in a less formal matter, such as the one illustrated above. However, when getting consent, it’s important to be clear about the scope of that consent. Make sure you’re clear about how and where you want to use content to help avoid any surprises (and lawsuits).

Riviana Foods objected to Planting Hope’s continued use of the symbol and filed a challenge in an unusual venue – the National Advertising Division (“NAD”). Although NAD focuses on advertising disputes, Riviana argued that Planting Hope’s use of the registered trademark symbol conveys the misleading advertising message that the RIGHTRICE trademark is registered with the USPTO.

This is far from a typical advertising case, and it’s not clear whether Planting Hope disputed NAD’s jurisdiction over the matter, but in March 2024, NAD issued a decision in which it recommended that the company stop using the registered trademark symbol in ads unless there is a final determination reinstating the RIGHTRICE trademark on the federal register. Planting Hope agreed to comply.

In May 2024, Riviana initiated a compliance proceeding questioning whether Planting Hope had sufficiently complied. Planting Hope explained that it had made changes to digital materials, but not physical materials, and that its motion to set aside the default judgment had been fully briefed and was awaiting a decision from the Trademark Trial and Appeal Board (“TTAB”). A successful motion would moot NAD’s decision.

NAD determined that just because Planting Hope was waiting for the TTAB decision, that didn’t mean it could wait to comply with NAD’s decision. NAD asked the company to take down images on its social media pages that included the registered trademark symbol. NAD didn’t ask Planting Hope to remove existing inventory with that symbol from stores, but cautioned the company not to produce new inventory with that symbol at this time.

Although NAD has previously determined that trademarks can convey advertising claims, this is the first time NAD has explicitly determined that an advertiser’s use of a trademark symbol can itself constitute a claim. NAD isn’t going to turn into a venue for broader trademark disputes, but if you find yourself in this narrow fact pattern, NAD may present a good venue for a challenge.

Non Fungible Tokens (“NFTs”) are very “on trend” and many brands are finding ways to use them to the benefit of their businesses. Blockchain technology also presents new challenges with respect to the enforcement of intellectual property rights. One particular challenge is the creation of blockchain domain names.

Please see our advisory, Unauthorized Blockchain Domain Names: What's a Brand to Do? It provides a summary background regarding blockchain domain names and suggestions for rights owners to navigate the new challenges they present with respect to enforcement.

See the advisory for the full details.

Post-Mortem Right of Publicity

This post-mortem right is transferable and descendible and will allow the estates of deceased individuals who died on or after March 30, 2021 to protect the exploitation of their likenesses for forty years after the person’s death. Notably, in order to bring a cause of action under the statute, the deceased’s estate must register their rights with the New York Secretary of State.

The amended statute also expressly prohibits the unauthorized use of a deceased performer’s “digital replica,” defined as “a newly created, original, computer-generated electronic performance by an individual in a separate and newly created original expressive sound recording or audiovisual work in which the individual did not actually perform,” if such use is likely to deceive the public into thinking the use was authorized by the deceased person or its successor. The law explicitly exempts a number of activities from liability under this new cause of action, such as digital remastering of an individual’s previously recorded performance. The statute also provides that the use of a “conspicuous disclaimer” explaining that the use of the performer’s persona in the digital replica has not been authorized precludes a finding that the public is likely to be deceived by such unauthorized use, thus precluding liability.

The new amendment also codifies a number of exceptions to post-mortem rights that have long been recognized by the courts as exceptions to rights of publicity, such as use in works that are in the public interest, or are educational, newsworthy, political, commentary, criticism, parody, or satire, and use in literary and other artistic works.

In addition to an award of injunctive relief, potential liability for violation of the post-mortem rights of publicity may include statutory damages in the amount of $2,000, or compensatory damages plus any profits attributable to the unauthorized use, and punitive damages.

Unlawful Publication of Sexually Explicit Depictions of Individuals

An individual has a cause of action against any person who: (a) disseminates or publishes such sexually explicit material; and (b) knows or reasonably should have known that the individual depicted in the material did not consent to its creation, disclosure, dissemination or publication. The bill provides that an individual depicted in such materials may only be found to have consented if the consent is provided in writing under particular conditions set forth in the statute.

A person may be liable for dissemination and publication of such unauthorized materials even if he did not participate in the creation or development of such materials. A disclaimer that the use is without consent will also not preclude liability.

There are certain exceptions to liability, including publication or dissemination for purposes of reporting, law enforcement, legal proceedings, or in connection with a matter of public concern. However, the law expressly states that such sexually explicit material shall not be considered of newsworthy value simply because the depicted individual is a public figure.

Liability for a violation of this new cause of action includes injunctive relief, punitive damages, compensatory damages, and reasonable court costs and attorney’s fees. The statute of limitations is three years after dissemination or publication of the sexually explicit material, or one year from the date a person discovers or reasonably should have discovered such dissemination or publication.

In Sum

Perhaps the most significant impact of New York’s new law are the protections against the publication and dissemination of digitally fabricated sexually explicit materials. This new cause of action will provide much welcomed protection to celebrities and other individuals who are the victims of deep fakes and other nefarious digital content, and will also require publishers of adult materials to increase their safeguards with respect to consent of an individual’s likeness in sexually explicit digital content.

[1]Senate Bill S5959D.

Photographer Mark Iantosca took a picture of a digital content creator wearing Elie Tahari clothing. Elie Tahari posted that picture on its social media accounts with the following caption: “@linhniller caught us in our footsteps wearing head to toe #ElieTahari. We loved how she styled the whole look.” Although the caption also tagged Iantosca, the company hadn’t sought his permission, and the photographer sued for copyright infringement.

In its defense, Elie Tahari argued that the use of the photograph was de minimis because reposting another’s picture has become commonplace on social media. Although that’s an argument that in-house counsel frequently hear from their marketing teams, the court soundly rejected it. “There is nothing ‘trivial’ about a business utilizing a professional photographer’s work to promote its products.” To hold otherwise “would represent a seismic shift in copyright protection.”

The court also rejected Elie Tahari’s arguments that its post did not amount to infringement simply because the company credited the photographer in the caption of its post or because it had hired the model to wear its clothing. “Simply put, attribution is not a defense against copyright infringement [and] defendant’s argument that the model is wearing defendant’s clothing line has no bearing on liability for copyright infringement.”

Many people who use social media in their personal lives repost pictures without permission from the photographers and without any consequences. It’s tempting to think that the same is true if you repost pictures on your company’s social media accounts. As this case demonstrates, though, the consequences for doing that can be much greater.

In Sohm v. Scholastic Inc., No. 18-2110, 2020 WL 2375056 (2d. Cir. May 12, 2020), the Court found, among other things, that monetary damages in a copyright infringement suit are limited to those incurred in the three years preceding the commencement of suit.

In Sohm, professional photographer Joseph Sohm and one of his agencies sued Scholastic Inc. in the Southern District of New York for, among other things, alleged copyright infringement of 89 of his photographs. The district court granted in part and denied in part the parties’ cross-motions for partial summary judgment. On appeal, Sohm and Scholastic each raised various challenges to the district court’s order. Most significantly, Scholastic argued that the district court erred in: (1) applying the “discovery rule,” and not the “injury rule,” to determine when the plaintiffs’ claims accrued under the statute of limitations; and (2) allowing damages that accrued more than three years prior to the date that plaintiffs filed the copyright infringement suit.

In deciding the statute of limitations issue, the district court applied the “discovery rule” and found the action was timely filed because Scholastic had failed to show any reason that Sohm should have discovered the infringing acts more than three years prior to the date it filed the complaint. The Second Circuit affirmed, rejecting Scholastic’s argument that two recent Supreme Court decisions, SCA Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC, 137 S. Ct. 954 (2017) and Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S.663 (2014), cast doubt on the “discovery rule’s” applicability, because in both cases the Supreme Court specifically declined to rule on the applicability of the rule.

The Second Circuit reversed the district court’s decision regarding recovery of damages for infringement. It agreed with Scholastic that regardless of whether the discovery rule or injury rule applies for purposes of accrual of a claim, the Supreme Court’s decision in Petrella clearly held that the Copyright Act limits a plaintiff’s recovery to damages incurred in the three years prior to filing suit. There, the Supreme Court explained that “[u]nder the Act’s three-year provision, an infringement is actionable within three years, and only three years, of its occurrence” and “the infringer is insulated from liability for earlier infringements of the same work.” Petrella, 572 U.S. at 671. Thus, “a successful plaintiff can gain retrospective relief only three years back from the time of suit” and that “[n]o recovery may be had for infringement in earlier years.” Id. at 677.

This decision will be well-received by defendants in the Second Circuit who are faced with claims of copyright infringement more than three years after the allegedly-infringing behavior has ceased, such as a fashion company who is faced with an infringement claim regarding a product it has not sold for many years.

Unfortunately, since the Supreme Court’s ruling in Petrella, most circuits, including the Ninth Circuit, have not yet squarely addressed whether copyright infringement damages should be limited to those incurred in the three years preceding suit. Some district courts in the Ninth Circuit have since suggested that damages incurred more than three years prior to suit should be permitted so long as the plaintiff had no reason to know about the infringement prior to the three-year limitations period. See, e.g., Johnson v. UMG Recordings, Inc., 2019 U.S. Dist. LEXIS 184455 (C.D. Cal. Oct. 23, 2019). This presents a potential split among the circuits with respect to the availability of damages for copyright infringement outside the three-year statute of limitations.

Romag Fasteners, Inc. v. Fossil, Inc. et al., Case No. 18-1233, involved an interpretation of Section 35 of the Lanham Act (15 U.S.C. § 1117(a)) which reads in relevant part:

When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office, a violation under section 1125(a) [for trademark infringement] or (d) [for cybersquatting] of this title, or a willful violation under section 1125(c) [for dilution] of this title, shall have been established in any civil action arising under this chapter, the plaintiff shall be entitled, subject to the provisions of sections 1111 and 1114 of this title, and subject to the principles of equity, to recover (1) defendant’s profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action.

Prior to today’s decision, the rule in several Circuits, including the First, Second, Ninth and Tenth, was that a plaintiff must first prove willful infringement before it could seek an award of defendant’s profits for trademark infringement. This rule was based upon case law holding that the principles of equity require a demonstration of willful wrongdoing to justify the harsh remedy of a disgorgement of defendant’s profits -- as opposed to an award of actual damages a plaintiff may prove it suffered as a result of the infringement.

In the underlying action, Romag Fasteners, Inc. (“Romag”), a seller of handbag fasteners, sued defendant Fossil, Inc. (“Fossil”) claiming that Fossil infringed its registered ROMAG trademark by using counterfeit fasteners on its Fossil products. The jury found infringement, but in response to a special interrogatory, found that Romag had not proven that Fossil’s infringement was willful. However, the jury still awarded a disgorgement of defendant’s profits on the infringement claim because they found it necessary to deter future infringement. The District Court later struck the award of defendant’s profits because the jury did not find willful infringement, as was required by the law of the Second Circuit. The Federal Circuit, applying Second Circuit law, affirmed, and the case was appealed to the Supreme Court.

The Supreme Court found that a “categorical rule” requiring a threshold showing of willful infringement could not be “reconciled with the statute’s plain language.” Despite holding that willfulness is not a prerequisite to awarding defendant’s profits, the Court made clear that a defendant’s mental state remains highly relevant to fashioning appropriate remedies for trademark violations. In essence, the holding counsels that while defendant’s state of mind is a “highly important consideration” in determining whether profits should be awarded, willfulness is not a precondition to the availability of such an award in the first instance.

The elimination of the willfulness prerequisite may lead to more opportunistic plaintiffs and windfall damage awards. It will certainly change the manner in which defendants in some circuits assess the prospects of litigation and may affect the likelihood that an award of defendant’s profits will be precluded prior to trial. However, particularly given the difficulty in recovering attorneys’ fees in most trademark infringement cases, a plaintiff will still need to carefully consider whether the potential merits of its case justify the significant costs of litigating a matter to a decision. Moreover, even after the Supreme Court’s decision, courts will have broad discretion as to how to weigh the state of mind of a defendant in each particular case in determining both the available remedies, and the amount of any award.

Mraz alleges that MillerCoors did not seek his permission, and that he wouldn’t have given it anyway. “Due to the family friendly nature of the song, Mraz has never licensed the composition for use by alcohol companies or other adult-oriented products and would never do so.” According to the complaint, the unauthorized use violates Mraz’s copyrights and right of publicity, among other things.

MillerCoors removed the ad from Instagram, but a spokesperson insists the company didn’t do anything wrong. “MillerCoors contracted the rights to the BeachLife Festival and video assets through the event’s promoter, so if they truly feel there has been a violation here, we are not the party they should be suing.”

It’s too early to tell how this will turn out, and the case is likely to settle, so we may never have a clear answer. But it does illustrate an issue that commonly comes up with sponsorship agreements. Just because you’ve paid to sponsor a festival or other event doesn’t necessarily mean you have the rights to use footage captured at that event. You may need to secure those rights separately (and sometimes from another party). If you get those rights from the event organizer, make sure you have provisions in the agreement to help protect you against suits like this.

In jurisdictions that have adopted the Server Test, a website publisher can only be liable for direct infringement when a copyrighted image is hosted on its own server as opposed to being embedded or linked from a third-party server. On February 15, 2018, the court in Goldman v. Breitbart News Network, LLC, et al., U.S. District Court for the Southern District of New York, No. 17-cv-3144, found that embedding a tweet of a copyrighted image can be considered copyright infringement, regardless of where the image is hosted.

The Copyright Act grants copyright owners several exclusive rights to control the distribution and use of copyrighted works, including the right to make copies of the work, the right to distribute those copies to the public, and the right to publicly display the copyrighted work. In the Goldman case, the Court held that embedding a tweet of a copyrighted image can violate the copyright owner’s exclusive display right.

The Ted Stevens Olympic & Amateur Sports Act gives the United States Olympic Committee (or “USOC”) exclusive rights to use certain words, like “Olympic,” and symbols, like the interlocking rings. The Act also prohibits use of any word, symbol, or combination thereof that “tending to cause confusion or mistake, to deceive, or to falsely suggest a connection with” the user of the marks and the Olympics. Other countries – including South Korea – have similar laws.

Some companies pay a lot of money for the right to use these marks, so if you use them without permission, you could get a letter (or worse) from an official sponsor or a group like the USOC. The USOC has even tried stop companies from using marks in hashtags. For example, in 2016, the USOC’s chief marketing officer wrote that companies could not use hashtags such as #Rio2016 or #TeamUSA.” According to some press reports, the USOC sent letters to various companies reiterating this position.

Feel free to cheer Team USA on from your personal social media accounts this summer. But remember that what may be called “patriotic” when done from your personal account could be called “infringement” when done from a business account.

DMCA and the Safe Harbor

The law is ever-changing in the U.S. regarding internet site liability for service providers and there are some instances in which the DMCA safe harbor will not protect DMCA compliant service providers from claims. To date however, companies should be able to manage risk by:

• adhering to mandatory DMCA requirements, including: (a) providing required contact information for a registered agent to the U.S. Copyright office and on the company’s website; (b) establishing a repeat-infringer policy which includes potential termination of use of site, the terms of which are communicated to users; (c) expeditiously removing content in response to DMCA takedown notices; and (d) not interfering with standard technological measures used by content owners to identify and protect copyrighted works;

• removing any specific content which the company knows is infringing or which should be apparently infringing based upon facts or circumstances known to the company;

• not exerting material control or supervision over the user’s (infringing) conduct (if any);
• not receiving financial benefit directly attributable to the uploading or display of content by users.

Rule Changes

1. The existing paper registration system will be replaced by online registration.
2. All paper registrations will become invalid on December 31, 2017. All service providers, including those already registered, will need to re-register via the online system, available at https://dmca.copyright.gov/osp/login.html, before that date.
3. Service providers must supply the physical street address, not a post office box, of its designated agent. A post office box may be used only in exceptional circumstances, such as where it is dangerous to publicly publish a street address, and with prior written approval of the Copyright Office.
4. Registrations must be renewed every three years. Expired registrations can be renewed at any time.
5. Any amendment or update to a registration restarts the three year clock.
6. The registration fee has been reduced from $105 to a flat rate of $6 per agent designation. The same fee applies to amendments and renewals.

The text and U.S. Copyright Office Summary of the changes can accessed here: https://www.federalregister.gov/documents/2016/11/01/2016-26257/designation-of-agent-to-receive-notification-of-claimed-infringement

In the fashion world, this provision of the Copyright Act allows companies to protect original pictorial, graphic or sculptural features that are applied to garments, bags and other accessories. Examples include: fabric designs like a floral pattern; graphic art like an artistic rendition of a snake or tiger; and sculptural 3-D hardware adornments like belt buckles or buttons. Copyright protection only covers the artwork itself, not the overall configuration of the garment or other product to which it is applied.[2]

For decades, courts and commentators have struggled to fashion a suitable test to determine when a pictorial, graphic or sculptural feature of a useful article (such as a garment) is protectable under § 101 of the U.S. Copyright Act. On March 22, 2017, in a 6-2 decision written by Justice Thomas, the Supreme Court provided long-awaited clarification. Much to the relief of the fashion industry, the Court adopted a test that preserves copyright protection for applied art to apparel and fashion accessories.

In Star Athletica, LLC vs. Varsity Brands, Inc., 580 U.S. ____ (2017), the Supreme Court held that:

a feature incorporated into the design of a useful article is eligible for copyright protection only if the feature (1) can be perceived as a two- or three-dimensional work of art separate from the useful article and (2) would qualify as a protectable pictorial, graphic, or sculptural work—either on its own or fixed in some other tangible medium of expression—if it were imagined separately from the useful article into which is incorporated.[3]

Facts and Procedural Background

Star Athletica, LLC v. Varsity Brands, Inc. involved a dispute between two companies that sell cheerleading uniforms. Varsity Brands, Inc. (“Varsity”) designs, manufactures, and sells athletic apparel and accessories, including cheerleading uniforms. Varsity employs a design team that creates various two-dimensional designs, some of which are later incorporated onto the three dimensional surface of cheerleading uniforms. Varsity was granted U.S. copyright registrations for two dimensional artwork designs shown as depicted on the surface of cheerleading uniforms. Varsity submitted the images below[5] as the deposit copies during the copyright registration process:

Star Athletica, LLC (“Star Athletica”) also markets and sells cheerleading uniforms and accessories. Varsity filed suit after it discovered Star Athletica’s marketing materials were advertising cheerleading uniforms very similar to Varsity’s copyrighted designs. Varsity brought federal claims for copyright and trademark infringement against Star Athletica, together with a number of state claims including unfair competition.

Both parties cross-moved for summary judgment. In 2014, the U.S. District Court for the Western District of Tennessee granted partial summary judgment in favor of Star Athletica and dismissed Varsity’s copyright infringement claims. The District Court found that it could not conceptually separate the design features at issue—the colors-and-design components of a cheerleading uniform—from the utilitarian object that is a cheerleading uniform. As such, it held the designs were not eligible for copyright protection. Specifically, the District Court found that “a cheerleading uniform loses its utilitarian function as a cheerleading uniform when it lacks all design and is merely a blank canvas.”[6] In making this determination, the court considered factors such as whether the designer intended to create the designs for the purpose of use on a cheerleading uniform and whether the cheerleading uniform would be “marketable” as a cheerleading uniform absent the graphic designs.[7]

On appeal, a majority of the Sixth Circuit rejected the District Court’s conclusion “that a cheerleading uniform is not a cheerleading uniform without stripes, chevrons, zigzags, and colorblocks,” [8] and instead held that the graphic features of Varsity’s cheerleading uniforms were protectable subject matter under the Copyright Act. After identifying nine different potential tests to determine what separates the copyrightable elements of a “useful article” from those purely utilitarian elements, the Sixth Circuit crafted its own hybrid approach grounded in the text of the Copyright Act. The Sixth Circuit ultimately found that the graphic features of Varsity’s cheerleading uniform designs could be conceptually separated from the utilitarian aspects of the uniform, and were therefore capable of copyright protection. Specifically, the Court found that the “arrangement of stripes, chevrons, colorblocks, zigzags are ‘wholly unnecessary to the performance’ of the garment’s ability to cover the body, permit free movement, and wick moisture”[9] and that the graphic design could exist as an artistic work side by side with the useful article (the garment).

Supreme Court Case

In May 2016, the U.S. Supreme Court granted certiorari to determine: “[w]hat is the appropriate test to determine when a feature of a useful article is protectable under section 101 of the Copyright Act?”

Both parties agreed that the Copyright Act protects fabric designs that can be applied to garments, but not the design of a garment itself. The parties disagreed as to where on this spectrum Varsity’s designs fall. Varsity argued that the two dimensional designs of chevrons, zigzags, stripes and colorblocks were protectable graphic designs that were separable and independent from the useful article.[10] Star Athletica argued that the particular configuration of chevrons, zigzags and stripes did not meet the separability test and were chosen for the functional purpose of making the uniform’s wearer “slimmer” or “taller”.

The parties also disagreed as to what test the Court should apply to determine whether the designs were separable and independent graphic designs that are capable of copyright protection. Star Athletica proposed that the Supreme Court adopt a four part “statutory-separability analysis” that focused not just on physical separability but also other objective factors such as the design process and the marketability of the design or article.[11]

Varsity argued that original two-dimensional graphic designs are copyrightable under the plain meaning of the statute and do not lose copyright protection simply because they are applied to a useful article such as a cheerleading uniform. Accordingly, Varsity argued that the Court need not reach the separability argument. Varsity also rejected the proposed separability test advocated by Star Athletica in favor of the Copyright Office’s approach, which finds that a feature satisfies the separability requirement “only if the artistic feature and the useful article could both exist side-by-side and be perceived as fully realized, separate works—one an artistic work and the other a useful article.”[12]

Supreme Court’s Decision

In its much awaited decision, the Supreme Court fashioned a test for separability[13] that is true to the text of the Copyright Act and is in line with the approach suggested by the Copyright Office:

[A] feature incorporated into the design of a useful article is eligible for copyright protection only if the feature (1) can be perceived as a two- or three-dimensional work of art separate from the useful article and (2) would qualify as a protectable pictorial, graphic, or sculptural work—either on its own or fixed in some other tangible medium of expression—if it were imagined separately from the useful article into which is incorporated.[14]

The Supreme Court clarified that if Varsity is ultimately successful in establishing valid copyrights in the designs at issue in the case, it “may prohibit only the reproduction of the surface designs in any tangible medium of expression—a uniform or otherwise.”[15] Varsity, however, has “no right to prohibit anyone from manufacturing a cheerleading uniform that is identical in shape, cut, and dimensions” to the uniforms at issue here.[16]

Effects on the Fashion Industry

The Supreme Court’s adoption of a single, coherent test to determine the protectable design aspects of a garment provides much-needed guidance that should provide the fashion industry with more confidence and clarity. The Court’s decision also confirmed that copyright protection for pictorial, graphic and sculptural features applied to useful articles such as apparel and other fashion items is alive and well. Perhaps most importantly, the Court specifically rejected some criteria previously endorsed by courts that have potentially adverse results for fashion companies who rely upon copyright protection in applied art to help protect their business from knock-off products.

For example, the Court specifically rejected the distinction between “physical” and “conceptual” separability previously adopted by a number of courts, which considered the result upon the useful article if the artistic design feature were removed. The Court found that an examination of the “physical-conceptual distinction is unnecessary” [17] because “[t]he focus of the separability inquiry is on the extracted feature and not on any aspects of the useful article that remain after the imaginary extraction.”[18] The Court noted that the Copyright Act specifically provides copyright protection for art that is applied to useful objects, and that an artistic work cannot lose protection “simply because it was first created as a feature of the design of a useful article, even if it makes that article more useful.” [19]

The Supreme Court also specifically rejected the notion that design methods, purposes and reasons should be considered in determining whether graphic, pictorial or sculptural elements are capable of copyright protection, noting that there is no basis for such considerations in the text of the Copyright Act.[20] Had the Court considered such criteria, as advocated by Star Athletica, it could have effectively eliminated protection for applied art for fashion companies that employ designers to create pictorial, graphic and sculptural works for the purpose of applying them to fashion products.

The Court also rejected Star Athletica’s contention that it should consider the marketablility of the design elements in determining whether they are capable of copyright protection. As noted by the Court, marketability is not a prerequisite to copyright protection under the Copyright Act and such a rule would “threaten[] to prize popular art over other forms, or substitute judicial aesthetic preferences for policy choices embodied in the Copyright Act.”[21] Such a rule would also have the potential to disadvantage new designers and small companies who may not have an established market for their designs.

In all, the Supreme Court gave the fashion industry a little something to cheer about.

For more information on this client advisory, please contact:

Andrea L. Calvaruso (212) 808-7853 [email protected]

[1] U.S. Copyright Act, 17 U. S. C. § 101.

So far, this story is fairly typical, and could represent any number of contests that are run in the US every year. What makes this story different, though, is that the owner of one of the photos Anheuser-Busch used filed a lawsuit against the company for copyright infringement, invasion of privacy, and violation of her right of publicity. Kayla Kraft argues that she owns the copyrights to a photo of her drinking beer while wearing a fake mustache that Anheuser-Busch used in its campaign, and that the company used the photo without her consent. She is seeking unspecified damages.

It’s difficult to piece together what may have happened. According to press reports, Anheuser-Busch says that Kraft’s picture was submitted as a contest entry. The company hasn’t answered the complaint yet, though, and the complaint doesn’t specifically mention the contest, so we don’t have a lot of details. Obviously, the case is going to turn on facts that we don’t have, including who submitted the picture. But although it’s too early to draw clear lessons from the case, the suit still highlights some important issues related to the use of user-generated content (otherwise known as “UGC”).

Companies can – and should – put provisions in rules that (among other things) tell people what they can and can’t submit, specify what rights the company has to submissions, and release the company from any liability. Keep in mind, though, that not everyone will read the rules, and that submitters may not even have the authority to grant the necessary rights. There are some things companies can do to address these risk. For example, it might make sense to highlight key provisions outside of the rules. And although you may be able to rely on online releases for some things, there are instances – such as when you want to use content offline – in which an offline written release make more sense.

Almost every campaign that includes UGC involves a careful balancing of risks. Because a “perfect” solution may be cumbersome in many cases, most companies will accept some level of uncertainty. But lawsuits like this serve as good reminders of what can go wrong.

SnappyScreen sells an automatic sunscreen application vending machine into which a person can walk in pale, and walk out nicely-bronzed ten seconds later. The company touted this benefit to prospective customers, and it advertised that its machine was “the World’s First Touchless Sunscreen Application System.” All is not sunny in the world of sunscreen machines, though, and SnappyScreen was sued by a competitor who argues that this claim is false. Sunscreen Mist Holdings argues that it has sold and promoted similar products since 2006, and that those products are protected by a patent. The company is suing for patent infringement and false advertising.

It’s too early to predict how this case will turn out, but it’s not too early to identify a key lesson here. If you want to advertise that you are the first or only company to have a product or feature, it’s often a good idea to commission a search by a patent attorney. A good patent attorney will look for issued patents and other pre-existing products and public disclosures that can help you identify whether you are, in fact, the “first and only.” The results can help you figure out whether you can support the claim you want to make or, if not, whether there are ways to narrow it down. For example, if you can’t claim that your company was the first to come up with a certain type of product, maybe you can focus on the uniqueness of a certain feature.

Aside from providing advertising guidance, the search can also be used for other purposes, such as determining whether there are patents your product might be infringing (and how to design around them), and whether it makes sense to explore patent protection for your product or any of its unique features.

The analysis may require additional steps, but if you skip this first one, you might find yourself getting burned later.

Last month, the Copyright Office issued a Final Rule that will impact all online service providers, even those who have already registered for safe harbor protection. Here is a summary of the key changes:

• Effective December 1, 2016, the Copyright Office will no longer accept registrations on paper or PDF, as it has done since the DMCA was enacted in 1998. Instead, agents must register through an online system.
• All online service providers must register through the new system by December 31, 2017 – even if they have registered before. Failure to do so will result in a loss of safe harbor protection as of January 1, 2018.
• Registrations will expire after three years, so online service providers will need to renew their registrations in order to maintain protection. The Copyright Office will send automated alerts to remind account holders about upcoming renewal deadlines. Any amendment or update to a registration will restart the three-year clock.
• There will be a flat fee of $6 for each registration, amendment, and renewal. Previously, online service providers had to pay a $105 registration. (Renewals were not required.)
• Online Service Providers can now name a department or even an entire entity (such as a law firm or other service provider) as the designated agent.
• Until December 31, 2017, copyright holders who want to submit a takedown notice will have to search both the old and the new electronic database when trying to identify registered designated agents.

To help acquaint users with the new system, the Copyright Office has created the various video tutorials to show, step-by-step, how to use the system.

For more information, please see our advisory.

Remember that the International Olympic Committee and the United States Olympic Committee have exclusive rights to Olympic marks and that the unauthorized use of those marks could constitute infringement. The protected marks include Olympic rings, the Olympic flame, “Team USA, and “Rio 2014.” Some companies pay a lot of money for the right to use these marks, so if you use them without paying that money – even on social media – it’s likely to get noticed, and you could get challenged.

For example, when the Olympic torch blew out in Sochi, a bystander with a Zippo lighter re-lit the flame. Zippo capitalized on that event and posted pictures on social media with the hashtag #ZippoSavesOlympics. The company was quickly contacted by Olympic officials and it stopped using the hashtag soon after. (Revised ads referred more generically to “winter games.”) It could have been worse. The USOC can bring a civil action against any company who uses an Olympic trademark in a way that tends to cause confusion or falsely suggests an association between the Olympics and that company.

Feel free to cheer Team USA on from your personal social media accounts this summer. But remember that what may be called “patriotic” when done from your personal account could be called “infringement” when done from a business account.

The Italian gun-maker featured Elvis imagery in various ads, including the one below, and hired Elvis impersonators to appear at various events. (Catch a video here before it’s taken down.) According to the complaint, Beretta’s unauthorized use of the Elvis imagery “falsely indicated to the purchasing public that Beretta, its business, and its goods were somehow sponsored, endorsed, or approved by plaintiff . . . .” This caused injury to the estate “by depriving the plaintiff of its right to control the usage of its property and to derive monetary benefit from authorized usage of such property.” The estate seeks an injunction and monetary damages.

This case serves as a reminder that a celebrity’s right of publicity can extend beyond the grave. A number of states — including Tennessee — have statutes that explicitly recognize a post-mortem right of publicity. Even in states without these types of statues, the estates of celebrities may have certain common law rights. If you want to use a celebrity in your ad campaign — regardless of whether that celebrity is dead or live — make sure you check with your legal team first.

The FTC’s draft complaint against MPHJ hints to a broader investigation into the practices of the “patent troll” or non-practicing entity (NPE) industry. In September 2013, the FTC sought public comments on a proposal to issue compulsory process orders seeking information from 25 "patent troll" entities (entities that are in the business of buying and asserting patent rights). MPHJ’s suit is just the first to challenge the Commission’s jurisdiction over patent enforcement activity. Specifically, MPHJ’s complaint calls into question whether the FTC has authority to restrict the assertion of allegedly valid patent enforcement rights. If the court decides that the FTC does not have jurisdiction, the case could impede the FTC’s effort to prevent potentially abusive patent-troll tactics.

We will continue to monitor this case and post updates here.