1709 Blog: for all the copyright community

Tuesday, 27 January 2015

Zimmer in the frame over movie claim, Smith moves on with Stay With Me

Now there's that old saying isn't there - "where there's a hit - there's a writ" and whilst this blogger often spies claims of plagiarism, sampling and sometimes even downright copying which usually result in at least the threat of a lawsuit in the film, TV and music sectors, a claim in relation to the Oscar winning movie 12 Years a Slave has also thrown up claims violations of moral rights (under the copyright laws of Germany and France) - but in a US court. And elsewhere, a pop tune claim seems to have come to a sensible conclusion with at least the acknowledgement that an earlier Tom Petty work may have influenced the hit Stay With Me from the ever so soulful Sam Smith. 

The Hollywood Reporter lets us know that a U.S. civil lawsuit has been filed on behalf of composer Richard Friedman against composer Hans Zimmer, along with 20th Century Fox, Sony Music and various companies connected to the movie, for the alleged inclusion of a copyrighted music composition into the film's main musical theme.

According to the complaint, filed in a Californian federal court, the "Solomon Northup" theme in the movie can be traced to a 2004 Friedman composition titled "To Our Fallen," which allegedly was widely distributed as part of a music sample entitled "American Heart." The plaintiff says that the sound recording was embodied in a 2008 episode of the ABC series Desperate Housewives and that the string overdub portions of the music were recorded at the same recording facility used by Zimmer to create most of the musical score for 12 Years a SlaveFriedman is demanding monetary damages and an injunction.

The lawsuit's "quirkiest bit" is the assertion of the violation of Friedman's moral rights in the fourth and fifth claims for relief. The film, of course, had international distribution. The claim under (VII) relates to German law ('The German Copyright Statute of 1965') and refers to (in a translated form) the "right of recognition of authorship" and the author's right to prohibit "any distortion or mutilation of the work" before going on to apply the restricted acts in German law - here of reproduction, distribution and broadcast. The fifth claim under French law (VIII) is brought under 'The Republic of France the Code of Intellectual Property 1992' which seemingly provides that (in a translated form) L121.1  "an author shall enjoy the right to respect for his name, his authorship and his work" before going on the outline L121.2 (the author's right to divulge his work) and  L122.1 (the author's right of exploitation ... the right of performance and the right of reproduction) and the lawsuit asks for relief under the relevant French and German law.  This makes for uncomfortable reading when compared with the claim's choice of court for a jury trial in (II) Jurisdiction and Venue: the court selected is the District Court of the Central District of California Western Division and the claim is oddly silent on why French and German law claims are included, whilst also asserting that the District Court has "original and exclusive jurisdiction over the subject matter of this civil action under the Copyright Act 17 USC ss411 and 511", that the court has supplemental jurisdiction over a claim of unfair competition and that venue is the proper location as the defendants transact business within the District and can be found there and that many of the infringing acts were performed and occurred within the District. 

Rather handily TMZ has a comparison of the two works: One rather amusing comment goes "Oh puh-leeze! Mr. Zimmer also has two legs and is right-handed. Coincidence? At least in this excerpt, Mr. Friedman's piece is a very generic idea. They probably both ripped off me! And Beethoven. And Mozart. And. And. And....".

But in another songbook altogether  ....... When Sam Smith’s “Stay With Me” was released in April 2014, a number of commentators were quick to note the distinct resemblance to Tom Petty and the Heartbreakers’ 1989 classic tune “I Won’t Back Down”. Now details have emerged of a settlement on the split of song writing credits and a new split in the song's royalties. And remember it’s similarities in the song that this matter is about – NOT the sound recordings themselves – which this blogger feels are quite different. However, there is certainly an arguable similarity in some of the chord sequences so I am guessing that, and perhaps the presumption of 'casual connection' is why the claim was settled. The settlement reportedly included a 12.5% writing credit to both Petty and composer Jeff Lynne (of ELO fame) and the song’s credits on ASCAP (the collection society the American Society of Composers, Authors, and Publishers ) now lists Smith, Petty, Lynne, William Phillips and Jimmy Napes as the chief songwriters in what appears to be an amicable and sensible deal.  Again there's a handy 'compare for yourself' audio facility here. So you can make your own mind up!

http://www.hollywoodreporter.com/thr-esq/12-years-a-slave-draws-767183 and http://www.thesun.co.uk/sol/homepage/showbiz/bizonsunday/6294030/Sam-Smith-settles-up-royalty-dispute-with-Tom-Petty-and-Jeff-Lynne.html and for more on the UK's position on 'casual connection see Francis Day & Hunter v. Bron, [1963] Ch. 587

Marrakesh Treaty: now Paraguay makes six

The World Intellectual Property Organization has just issued a media release, Marrakesh Notification No. 6: Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled: Ratification by the Republic of Paraguay.

The event which this release records is the deposit by the Government of the Republic of Paraguay of its instrument of ratification of the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who are Blind, Visually Impaired or Otherwise Print Disabled. The date of entry into force of this Treaty will be three months from the date on which it secures the requisite number of 20 accessions or ratifications required under Article 18.  At present there are just six countries which have taken this step: three from Latin America, plus India, the United Arab Emirates and Mali. Things are a little silent in Europe, however ...

You can check additions to the list on the Treaty's Notifications page here.

Monday, 26 January 2015

Sensory copyright: a forthcoming event

Talking scents? On Tuesday 24 February the IPKat weblog teams up with the British Literary and Artistic Copyright Association (BLACA) for the second year running to host an exciting meeting on sensory copyright. Topics under review include the scent of perfume, the taste of cheese and other sensory works of authorship that fall outside the classic foursome of literary, dramatic, musical and artistic works.  

Is it an aerial photo of the wilds of Canada? A close-up of a chunk of marble?
Or a shot of a distant planet? No -- it's the surface of a cheese ...
The venue is the London office of Reed Smith LLP at 20 Primrose Street (here) and IPKat/1709 Blog contributor Eleonora Rosati (University of Southampton) will present the case in favour of protection of sensory works. IP practitioner and academic Tobias Cohen Jehoram, who has litigated this very topic in his native Dutch courts, will be taking the contrary position.  IPKat/1709 Blog blogmeister Jeremy will be in the chair.

The order of ceremonies runs like this: doors open at 4.30 pm for a 5 pm start.  After the serious side of the programme there will be some sensory delights -- whether protected by copyright or not -- in the form of refreshments kindly provided by our hosts.  There is no admission fee. 

The venue only holds 100 people so if you are planning to come, do email Polly Taylor at polly.taylor@blplaw.com to register your interest and be put on the guest list. It is likely that this event is going to be oversubscribed and we are unable to reserve places.  The seats will be allocated on a first-come first-serve basis on the day so do arrive early to ensure yourself a place.

Sunday, 25 January 2015

The CopyKat - looking backwards, looking forwards

Jerry Fisher, a photographer in Sioux Falls South Dakota, was interested in 3D printing and 3D image capture. So he went and photographed two local bronze casts of Michelangelo statues, one of Moses which is on display at Augustana College and is co-owned by Augustana and the City of Sioux Falls, and another of David (yes, the really famous one!), which is in a local city park. He blogged about his efforts to take the photos and turn them into 3D printer plans but came up against Augustana College when he uploaded preliminary model of Moses onto socia media: Fisher was promptly asked to take the Moses model down by The College who felt they had propriety over the statues (and were 'uncomfortable' with this use) and (supposedly) that their legal depatrment was of the opinionn that the College owned copyright(s) in the statues, Now Public Knowledge has provided Fisher with the answer that he already suspected was true - the College does NOT own a copyright in a 16th century reproduction statue by Michelangelo (!) and Public Knowledge's Michael Weinberg explained "Let’s get one thing out of the way right now: Augustana College had no legal right or basis to threaten Fisher with the specter of infringement. There is no copyright protection for a sculpture that was created at the dawn of the 16th century by a sculptor who died 450 years ago. All of Michelangelo’s work is firmly in the public domain. If fact, copyright didn’t even exist during Michelangelo’s lifetime. From the moment he sculpted his Moses anyone could copy, remix, and build upon it for any reason, without having to ask permission."  More on 3DPrint.com here.

James Bond, 007, the iconic master spy, is now available for more dangerous assignments from Canadian writers, thanks to a copyright quirk that allows the writing and publication in Canada of original material based on Bond creator Ian Fleming’s work. The Canadian press have noted that as of January 1st this year, the original writings of Fleming, a former British naval intelligence agent who published 12 novels and nine stories featuring 007 between 1952 and 1966, have entered the public domain. That’s because Canada’s view of copyright is that it extends for 50 years after the death of a writer. Fleming died in 1964. More on the Globe & Mail here.

Silhouette comparisons of Jacobus Rentmeester's photo of Michael Jordan,
left, and Nike's Jumpman logo, right. Taken from court documents
Phortographer Jacobus Rentmeester is suing Nike in the federal court in Oregon for copyright infringement. Not only is he asking for profits associated with Nike's Jordan brand, which generated $3.2 billion in retail sales in 2014. He also is seeking to halt current sales and plans for the brand's future. Wow! Rentmeester says he staged and shot the picture of Michael Jordan in his Olympic warm-ups in 1984 for an issue of Life Magazine .As he was a freelancer, Rentmeester retained the rights to the copyright.  After it was published, Nike's Peter Moore, who designed the first Air Jordans, paid $150 for temporary use of Rentmeester's slides. Rentmeester says Nike then used his carefully choreographed picture using Jordan's left hand to 'slam dunk' the ball, to recreate the shot with Jordan in Bulls gear with the Chicago skyline in the background, but that it was essentially still his work and his suit says "Mr. Rentmeester created the pose, inspired by a ballet technique known as a 'grand jete,' a long horizontal jump during which a dancer performs splits in mid-air," the lawsuit says. "The pose, while conceived to make it appear that Mr. Jordan was in the process of a dunk, was not reflective of Mr. Jordan's natural jump or dunking style." This photo in turn was transfomed into a 'jumping' Jordan logo - and having threatened to sue Nike back in 1985 for the use of the Jordan logo based on his photo,  ESPN says thaRentmeester agreed Nike could use the logo for two years on billboards and posters in North America, for which he was paid $15,000. The Jumpman image also was featured as a tag on the Air Jordan I shoes, which sold for $65 a pair. In 2005 Nike withdrew an advert for its skateboard brand due to its similarity to artwork for a record by punk band Minor Threat.   This could be an interesting case - and reminds the CopyKat of the recent decision by Mr Justice Birss in Temple Island Collections Ltd v New English Teas Ltd & another [2012] EWPCC 1 where infringement was found, and the decision by a Korean appellate court that found that the 'recreation' of a photograph of a natural scene of pine trees on an island set against a skyline could not be infringement - although neither of those cases took 28 years to get to court ......

and to end ..... the 'pre-1972' story about copyright in sound recordings in the USA keeps on giving - and now Zenbu Magazines LLC,  the owner of recordings by Hot Tuna, New Riders of the Purple Sage and the Flying Burrito Brothers, is seeking class-action status for suits filed in U.S. District Court in Northern California, arguing that services such as Apple’s free iTunes Radio, and Sony’s Music Unlimited - which charge subscribers to access their service - have copied tens of thousands of  pre-1972 recordings onto their servers, transmitted them and performed them without seeking permission or paying performance royalties or licensing fees to the copyright owners. Rdio Inc and Google Play are also in the firing line.  Sound recordings weren’t brought under the protection of federal copyright law until 1972 so are protected by state laws and some services, notably SiriusXM, haven’t been paying performance royalties to artists to play these older works prompting claims from both artists (with Flo & Eddie from the Turtles leading the charge), record labels and collection society SoundExchange. More here.

Friday, 23 January 2015

Hoist The Colours High: The Pirate Bay is Coming Back

Here's a guest piece by Thomas Dubuisson (@tdubuisson) on a subject that refuses to fade away: the fate of The Pirate Bay. Thomas writes:
This is the day you will always remember as the day you almost caught Captain Jack Sparrow”(Jack Sparrow, Pirates Of The Caribbean)

For many years, internet service providers (ISPs) have tried, and sometimes succeeded, to block access to The Pirate Bay (TPB), known as the world's largest illegal file-sharing site, in several countries around the world. However, this time, it’s “in real life” and not, as expected, on the internet, that thepiratebay.se domain was shut down.

Launched in September 2003, The Pirate Bay website has since been involved in a number of lawsuits, mainly accused of copyright infringement and of authorizing the infringement of its users. Eleven years later, on December 9, 2014, Swedish police carried out a raid at the Nacka Station data centre, in Stockholm, seizing a huge treasure: servers, computers, and other equipment. As a result, the site has been taken offline and dragged down several other popular BitTorrent services (i.e. open Internet application for content distribution) with it, such as EZTV, Zoink, Torrage.

As a consequence, many people have been looking for Pirate Bay alternatives. Following the raid, many Pirate Bay “copies” flourished. For instance, the IsoHunt.to, a de facto replacement of the original site that reached a settlement with MPAA stipulating $110 million reimbursement for damages in 2013, launched an OldPirateBay.org to “save the Freedom of information on the Internet” and to “keep on sharing”. They also launched “The Open Bay” initiative, a new torrent landscape, allowing anyone to create a Pirate Bay copy on his/her own domain.

Are we getting closer to the end of “the day” Swedish police will always remember as the day they almost caught The Pirate Bay? New elements shared by The Pirate Bay crew seem to indicate the resurrection of the site. A few days after the Police raid, TPB installed a countdown timer on the homepage indicating that something is about to happen on February 1, 2015. Recently, the TPB included the site's familiar look with the site's search bar, categories, and navigation elements.

Pirate Bay users expect full recovery. Film-makers and distributors, television, and various creative industries combating online copyright infringement are however hoping that the phoenix will not rise anew from the ashes. However, with just a few days of the countdown timer left, the site is showing much more signs of life than ever before.

Online infringement actionable where damage occurs, irrespective of where it was intended to happen, says CJEU

In another preliminary ruling of yesterday's date, the Court of Justice of the European Union (CJEU) had to determine where a copyright owner can bring proceedings for infringement when a third party has made the work available online for viewing and downloading without consent. The decision is Case C‑441/13, Pez Hejduk v EnergieAgentur.NRW GmbH, a request for a preliminary ruling from the Handelsgericht Wien (Austria).

The facts are as follows. Pez Hejduk, a professional photographer of architecture, created photographic works depicting the buildings of the Austrian architect Georg W. Reinberg. As part of a conference organised by EnergieAgentur, Reinberg used Hejduk’s photographs in order to illustrate his buildings, with her permission.  Subsequently EnergieAgentur -- without Hejduk’s consent and without stating that she was the author -- made those photographs available on its website for viewing and downloading. Hejduk sued EnergieAgentur in the Handelsgericht Wien, seeking damages of over 4,000 euro plus permission to publish the judgment at EnergieAgentur's expense.

EnergieAgentur raised an objection that the Handelsgericht Wien lacked international and local jurisdiction, saying that its website was not directed at Austria and that the mere fact that a website may be accessed from Austria is insufficient to confer jurisdiction on that court. The Handelsgericht Wien therefore stayed the proceedings and asked the CJEU:
‘Is Article 5(3) of [Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters] to be interpreted as meaning that, in a dispute concerning an infringement of rights related to copyright which is alleged to have been committed by keeping a photograph accessible on a website, the website being operated under the top-level domain of a Member State other than that in which the proprietor of the right is domiciled, there is jurisdiction only

– in the Member State in which the alleged perpetrator of the infringement is established; and

– in the Member State(s) to which the website, according to its content, is directed?’
Yesterday the CJEU ruled as follows:
Article 5(3) ... must be interpreted as meaning that, in the event of an allegation of infringement of copyright and rights related to copyright guaranteed by the Member State of the court seised, that court has jurisdiction, on the basis of the place where the damage occurred, to hear an action for damages in respect of an infringement of those rights resulting from the placing of protected photographs online on a website accessible in its territorial jurisdiction. That court has jurisdiction only to rule on the damage caused in the Member State within which the court is situated.
While the jurisdictional side of the ruling has its upside, the notion that the court has jurisdiction only to rule on the damage caused in the Member State within which the court is situated is a pain if it potentially means separate litigation in each of 28 jurisdictions to recoup damages on a country-by-country basis, particularly if the aggregated damage is substantial but the per-country damage is rather less so.

Eleonora's Katpost, pointing out that the Advocate General's Opinion also took the view that damages rulings should not be so limited, can be read here.

Exhaustion of copyright and sale of altered products: CJEU rules in Allposters

The Court of Justice of the European Union ruled yesterday that the consent of a copyright holder does not cover the distribution of an object incorporating his work where that object has been altered after its initial marketing to such an extent that it constitutes a new reproduction of that work. The ruling is in Case C‑419/13, Art & Allposters International BV v Stichting Pictoright, a request for a preliminary ruling from the Hoge Raad der Nederlanden (the Supreme Court in The Netherlands).

The ruling deals with the exhaustion of the distribution right in copyright protected works under InfoSoc Directive 2001/29, Article 4 of which reads like this:
Distribution right

1. Member States shall provide for authors, in respect of the original of their works or of copies thereof, the exclusive right to authorise or prohibit any form of distribution to the public by sale or otherwise.

2. The distribution right shall not be exhausted within the Community in respect of the original or copies of the work, except where the first sale or other transfer of ownership in the Community of that object is made by the rightholder or with his consent.
Significantly, the InfoSoc Directive does not contain a proviso found in European trade mark legislation, notably in Article 7(2) of the Trade Mark Directive 2008/95, that exhaustion shall not apply
where there exist legitimate reasons for the proprietor to oppose further commercialisation of the goods, especially where the condition of the goods is changed or impaired after they have been put on  the market.
The facts of our case, in short, run like this:
Allposters, through its websites, markets posters and other reproductions depicting the works of famous painters, which are covered by the copyright exploited by Pictoright. Among other products, Allposters offers its clients reproductions in the form of posters, framed posters, posters on wood and images on canvases. In order to produce an image on canvas, a synthetic coating (laminate) is first applied [by Allposters] to a paper poster depicting the chosen work [for which the copyright is managed by Pictoright]. Next, the image on the poster is transferred from the paper to a canvas by means of a chemical process. Finally, that canvas is stretched over a wooden frame. The image of the work disappears from the paper backing during the process. 
The Hoge Raad der Nederlanden referred the following questions to the CJEU for a preliminary ruling:
‘(1) Does Article 4 of Directive 2001/29 govern the answer to the question whether the distribution right of the copyright holder may be exercised with regard to the reproduction of a copyright-protected work which has been sold and delivered within the [EEA] by or with the consent of the rightholder in the case where that reproduction had subsequently undergone an alteration in respect of its form and is again brought into circulation in that form?

(2) (a) If the answer to Question 1 is in the affirmative, does the fact that there has been an alteration as referred to in Question 1 have any bearing on the answer to the question whether exhaustion within the terms of Article 4(2) of [Directive 2001/29] is hindered or interrupted?

(b) If the answer to Question 2(a) is in the affirmative, what criteria should then be applied in order to determine whether an alteration exists in respect of the form of the reproduction which hinders or interrupts exhaustion within the terms of Article 4(2) of [Directive 2001/29]?

(c) Do those criteria leave room for the criterion developed in Netherlands national law to the effect that there is no longer any question of exhaustion on the sole ground that the reseller has given the reproductions a different form and has disseminated them among the public in that form (judgment of the Hoge Raad of 19 January 1979 in Poortvliet, NJ 1979/412)?’
Yesterday the CJEU answered this battery of questions with some brevity:
Article 4(2) of Directive 2001/29 ... must be interpreted as meaning that the rule of exhaustion of the distribution right set out in Article 4(2) of Directive 2001/29 does not apply in a situation where a reproduction of a protected work, after having been marketed in the European Union with the copyright holder’s consent, has undergone an alteration of its medium, such as the transfer of that reproduction from a paper poster onto a canvas, and is placed on the market again in its new form.
A rather fuller note on this decision by fellow blogger Eleonora, also summarising the not-yet-in-English Opinion of the Advocate General, can be found on the IPKat here (Eleonora has promised more to come ...).  Meanwhile, this blogger will confine himself to the observations that (i) the CJEU appears to have reached the same conclusion as would have been reached in an action for trade mark infringement, notwithstanding the absence of a specific provision along the lines of Article 7(2) of the Trade Mark Directive and that (ii) the term 'moral rights' appears just once, incidentally, in the ruling, while it seems that this ruling will be of particular use and interest to those seeking to resist the distribution of tangible products on the basis of infringement of the right to object to distortion or mutilation of their original works.

This case, whatever you may think of the decision, is another example of the CJEU's new, speedy approach to dealing with references for rulings from national courts.  The reference was only made in July 2013, so the whole issue has been turned round in 18 months. Only a few years ago it was rare for a ruling in an intellectual property case to be issued within 22 months.

Thursday, 22 January 2015

Omega attempt to block resales falls foul of the first sale doctrine - and possibly copyright misuse too

In the U.S. the 9th Circuit Court of Appeals has ruled that watchmaker Omega's attempt to use copyright laws to block the sale of Omega watches at discounted prices Costco will just not work.

By way of background, Costco had bought a quantity of Omega watches intended for sale in Europe, not the US. Costco then imported those watches into the USA and put them on sale in its stores, discounting the prices Omega itself normally sells its watches at. Omega, in an attempt to block this, had inscribed a tiny globe on the back of the watch,  a copyrighteded image, and sued Costco for infringement.

The case was first fought on 'first sale' grounds, with the 9th Circuit originally siding with Omega, wo had argued that because the globe wasn't "lawfully made under this title" (because it was made in Europe, not under US law), "first sale" rights didn't apply. The case went up to the Supreme Court which ended in a 4-4 tie, because Justice Kagan didn't sit (as she had filed an amicus brief in the case while she was Solicitor General). The case then went back down to the District Court to determine whether or not it was still copyright misuse, even if first sale wasn't an issue.

The District Court agreed that it was a misuse of copyright.  Omega appealed (of course) and now the 9th Circuit has sided with the lower court, by revising its first sale opinion, thanks to the intervening Kirtsaeng ruling in the Supreme Court - which found that textbooks and other goods made and sold abroad could be re-sold online and in discount stores in America without violating U.S. copyright law.

In reviewing the current case, the 9th Circuit amended its original opinion,a nd followed Kirtsaeng, finding that Costco's actions fell within the First Sale doctrine:

It is clear, then, that Omega has no infringement cause of action against Costco. Omega’s only allegation is that Costco violated Omega’s copyright-based importation and distribution rights by selling gray market watches without a prior authorized first sale in the United States. Omega concedes that it authorized a first sale of the watches in a foreign jurisdiction. Omega’s right to control importation and distribution of its copyrighted Omega Globe expired after that authorized first sale, and Costco’s subsequent sale of the watches did not constitute copyright infringement. Kirtsaeng, 133 S. Ct. at 1366; 17 U.S.C. § 109(a). Thus, application of the first sale doctrine disposes of Omega’s claim, resolves this case in Costco’s favor, and conclusively reaffirms that copyright holders cannot use their rights to fix resale prices in the downstream market.

The copyright misuse claim did not really feature: However, in a concurring opinion, Judge Wardlaw said that copyright misuse would apply, even if the First Sale doctine didn't:

The district court correctly held that Omega misused its copyright “by leveraging its limited monopoly in being able to control the importation of [the Globe Design] to control the importation of its Seamaster watches.” The district court did not clearly err in finding that: (1) Omega copyrighted the Globe Design, at the advice of its legal department, to control the importation and distribution of Omega watches into the United States; and (2) Omega told its authorized distributors that the purpose of suing Costco was to “stem the tide of the grey market” and the “unauthorized importation of Omega watches into the U.S.” In other words, Omega attempted to use the copyrighted Globe Design to decrease competition in the U.S. importation and distribution of its watches by it and its authorized dealers—an obvious leveraging of a copyright to control an area outside its limited monopoly on the design. 

Omega argues that its anti-competitive motives are irrelevant to the issue of copyright misuse. According to Omega, our inquiry should instead focus on the copyright holder’s objective conduct or use. But Omega’s semantic hairsplitting is unpersuasive. By definition, “use” includes an inquiry into purpose.... However, we need not decide whether Omega’s motives are sufficient to establish copyright misuse. The undisputed record shows that before this lawsuit consumers were able to a buy a genuine Omega Seamaster watch from Costco for 35% less than Omega’s suggested retail price. This is no longer the case. Thus, at least one consequence of Omega’s lawsuit has been a reduction of intrabrand price competition for uncopyrightable Omega watches in the United States.

Later noting:

The Copyright Office granted Omega the exclusive right to control the importation and distribution of the Globe Design into the United States. It did not empower Omega to restrict competition from unauthorized retailers selling genuine, gray market Seamaster watches in the United States. Although the Globe Design engraved on the underside of the Seamaster watches was copyrighted, Omega misused its copyright when it used its intellectual property protection to obtain a copyright-like monopoly over uncopyrightable Seamaster watches.... Omega’s expansion of its copyrightlike monopoly eliminated competition from unauthorized watch retailers like Costco, thereby allowing Omega to control—through its exclusive distributor, Swatch U.S.A.—the retail pricing of Seamaster watches sold in the United States. If the copyright law allowed Omega to use its copyright to combat the importation and sale of all gray market watches that are stamped with the Globe Design, it would effectively grant Omega a copyright-like monopoly over the distribution and sale of Omega watches in the United States. Because such an outcome directly controverts the aims of copyright law, it is impermissible.

And, finally, it concludes:

“The limited scope of the copyright holder’s statutory monopoly, like the limited copyright duration required by the Constitution, reflects a balance of competing claims upon the public interest: Creative work is to be encouraged and rewarded, but private motivation must ultimately serve the cause of promoting broad public availability of literature, music, and the other arts.” Twentieth Century Music Corp., 422 U.S. at 156 [footnote omitted]. Omega’s attempt to expand the scope of its statutory monopoly by misusing its copyright in the Globe Design upset this balance. The watchmaker’s anticompetitive acts promoted neither the broad public availability of the arts nor the public welfare. Instead, they eliminated price competition in the retail market for Omega watches and deprived consumers of the opportunity to purchase discounted gray market Omega watches from Costco. Omega misused its copyright by engraving the Globe Design on the underside of its watches, and attempting to use copyright law to eliminate intrabrand competition from Costco in the retail watch market. Because the District Court correctly held that Omega misused its copyright in the Globe Design by attempting to leverage its limited monopoly over the design to control the importation and sale of Seamaster watches, I would affirm the District Court on the issue of copyright misuse.

Some would like to gave seen more on misuse: Writing on TechDirt,  Mike Masnick opines: "While I understand why the majority ruling just went with the easy out with First Sale, it's too bad that this concurring ruling isn't the majority ruling, as we could use more useful opinions like this one when it comes to copyright misuse. Either way, kudos to the court for properly recognizing that even if you buy a watch outside the US, you should actually own it, and that copyright law shouldn't be able to get in the way of those property rights."

And more on Gigaom here