The World in U.S. Courts: Summer 2015 - Intellectual Property (Copyright)
This copyright infringement claim was brought by the composers of a 1978 song "San Francisco Bay" against U.S. and non-U.S. entities that have distributed internationally the hit song, "Timber," co-written in 2013 by Pitbull, Kesha, and Lukasz Gottwald. They, and the publisher "Far Out Music" ("FOM"), co-own the copyright. FOM, but not the other copyright owners, licensed the copyright to the defendants for worldwide use.
As relevant here, the U.S.-based defendants were first charged with copyright infringement in connection with allegedly infringing distribution of Timber outside the U.S. The District Court in New York stated that acts constituting copyright infringement under foreign law do not constitute a violation of the U.S. Copyright Act, which has no extraterritorial applicability, but noted an exception where an act of infringement in the U.S. permits further reproduction in other countries. The Court found this requirement was not met because the U.S. acts allegedly involved in this case, including the creation of duplicate master tapes and electronic files, were not infringing because the defendants possessed a U.S. license covering the allegedly unlawful conduct. (The Court found that the alleged "authorization" in the U.S. of unlawful copying abroad could not support a U.S. copyright infringement claim, but noted that courts elsewhere had reached a different conclusion as to the scope of the law.)
Claims of copyright infringement outside the U.S. were also brought against non-U.S. affiliates of Sony Music Entertainment ("SME"), a U.S. company, arising out of their distribution of Timber in their home countries. A key legal question was what country's law would apply: In the U.S., worldwide rights can be granted by just one co-owner of a copyright (in this case, FOM). In the countries where the alleged infringement occurred, such a license, to be effective, has to be granted by all co-owners. Thus, if U.S. law applied, the ex-U.S. distribution would be deemed to have been lawful; otherwise, it could be infringing. The District Court observed that questions relating to the ownership of a U.S. copyright were decided under the law of the country "with the most significant relationship to the work in question." A different rule was applied to whether there was infringement, which was to be decided under the laws of the country where the alleged infringement occurred. At issue in this case was the scope of the license, and the Court held that issue was to be judged under the laws of the country where the allegedly infringing distribution occurred. Because FOM's license was invalid in those countries, the case was allowed to proceed.
[Editor's note: The Levitin case is also discussed in the Personal Jurisdiction/Forum Non Conveniens section of this issue.]