IP/Entertainment Law Weekly Case Update for Motion Picture Studios and Television Networks
July 21, 2010
Table of Contents
Fox Television Stations, Inc. et al. v. F.C.C., USCA Second Circuit, July 13, 2010
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The Second Circuit held that the Federal Communications Commission (“FCC”) “fleeting expletives” policy is unconstitutionally vague in violation of the First Amendment. The court held that the rule used by the FCC, which relied on a three-factor analysis to determine whether uses of allegedly indecent language were “patently offensive,” failed to give adequate notice of what conduct would or would not be a violation. The court determined that the policy, in effect since 2004, had in fact chilled protected speech on several occasions.
- The U.S. Court of Appeals for the Second Circuit held that the FCC’s “fleeting expletives” policy is unconstitutionally vague in violation of the First Amendment.
From 1978 until 2001, the FCC based its rules concerning the use of indecent language on radio and broadcast television on the Supreme Court’s decision in FCC v. Pacifica Foundation, 438 U.S. 726 (1978) (“Pacifica”). Pacifica, a case which arose from comedian George Carlin’s “Filthy Words” monologue, set forth a blanket prohibition on the use of specific words, regardless of context. Citing the need for a more flexible policy for indecency enforcement, the FCC set forth the underlying rule for its “fleeting expletives” policy in its 2001 Industry Guidance. There, the FCC explained that an indecency finding involved two determinations. The first determination is whether the material describes or depicts sexual or excretory organs or activities. The second determination is whether the broadcast is “patently offensive” as measured by contemporary community standards for the broadcast medium. The second, “patently offensive” determination depends on three factors: “(1) the explicitness or graphic nature of the description or depiction, (2) whether the material dwells on or repeats at length, and (3) whether the material appears to pander or is used to titillate, or whether the material appears to have been presented for its shock value.”
After U2 band member Bono uttered an expletive during the live broadcast of the 2003 Golden Globe Awards, the FCC issued an order (the “Golden Globes Order”), which signaled another significant change in the FCC’s indecency enforcement policy. Under the Golden Globes Order, the FCC declared, for the first time, that a single, nonliteral use of an expletive (a so-called “fleeting expletive”) could be actionably indecent. The analysis set forth in the FCC’s 2001 Industry Guidance, combined with the actionability of a single utterance, created the “fleeting expletives” policy. As it eventually developed, the policy also included a blanket prohibition, with limited exceptions, on the use of the words “shit” and “fuck.” At around the same time, the FCC also began interpreting penalty assessments as being on a per-broadcast, rather than a per-program basis, with each licensee accounting for at least one broadcast. Along with Congress’s increase of the maximum indecency fine from $32,500 to $325,000, this change in enforcement policy subjected violators to fines which could easily run into the tens of millions of dollars.
In 2006, the FCC applied the “fleeting expletives” policy to a number of programs, four of which it found indecent in an Omnibus Order. Fox Television Stations, Inc. (“Fox”), CBS Broadcasting Inc., and ABC Inc. filed petitions for review of the Omnibus Order with the Second Circuit. After the FCC voluntarily issued a Remand Order, which reaffirmed its finding of indecency with regard to two programs and reversed or dismissed with respect to the other two, Fox and its fellow petitioners sought review of the Remand Order. In a 2-1 decision, the Second Circuit invalidated the “fleeting expletives” policy as arbitrary and capricious under the Administrative Procedure Act. The Supreme Court granted certiorari and, in a 5-4 decision, reversed the Second Circuit’s decision and remanded, instructing the Second Circuit to consider constitutional challenges to the FCC’s policy not addressed in its first decision.
On remand, the Second Circuit noted in the first part of its discussion that it is “well-established that indecent speech is fully protected by the First Amendment.” The court also observed that, unlike the strict scrutiny which usually applies to content-based restrictions on indecent speech, the Supreme Court has applied something “more akin to intermediate scrutiny” to indecency restrictions in the context of radio and broadcast television. This distinction was set forth most clearly in Pacifica, in which the Court upheld an FCC restriction against George Carlin’s expletive-laced monologue, based upon concerns over the pervasiveness of broadcast media and children’s access to it. In this decision, the Second Circuit criticized the Pacifica framework as outdated in light of the proliferation of new kinds of media, like the internet, which undercuts the pervasiveness justification for the broadcast distinction, and in light of the rise of parental controls technology which effectively does away with the concern over exposure to children.
The court found that the FCC’s “fleeting expletives” policy was impermissibly vague, in part, because in its orders applying the policy, the FCC has not discussed how it has or will apply the three “patently offensive” factors, but rather has merely repeated one or more of the factors. The court reasoned that this gives insufficient notice to broadcasters as to how to avoid violating the policy. The FCC’s policy stands in contrast to the earlier Pacifica rule which, although it was rigid in its prohibition of seven specific words, at least provided clear guidance to broadcasters.
The court further reasoned that vagueness problems arise from the FCC policy’s blanket prohibition on the words “fuck” and “shit” and the two exceptions to that prohibition: the “bona fide news” exception and the artistic necessity exception. The court stated that the FCC has not set forth a clear explanation of when or how either exception would apply. Although the FCC created the exceptions to avoid First Amendment issues that would have arisen as a result of a complete ban on the offending words, the high level of discretion that the FCC wields in deciding when either exception applies gives rise to its own set of constitutional problems. As the court observed, the FCC’s indiscernible standards create “the risk that such standards will be enforced in a discriminatory manner.” As evidence of the risk of such discrimination, the court cited the fact that the FCC approved the repeated use of “fuck” and “shit” in the fictional film Saving Private Ryan while refusing to apply either exception to the words’ use in the documentary film The Blues.
Concluding its vagueness analysis, the court found that the FCC “fleeting expletives” policy did have a chilling effect on protected speech. The court cited numerous events as evidence of this chilling, including: (1) the refusal of several CBS affiliates to air a documentary about the September 11th attacks which included audio footage with expletives; (2) Fox’s decision to air the 2003 Billboard Music Awards with an expensive audio delay; and (3) Fox’s decision to not re-broadcast an episode of “That 70s Show” which dealt with masturbation. Citing these and other examples, the court concluded that the FCC’s prohibiting “patently offensive” words or phrases without giving adequate guidance as to what “patently offensive” means has the effect of “promoting wide self-censorship of valuable material which should be completely protected under the First Amendment.” So concluding, the court held that the FCC’s policy is unconstitutionally vague.
Sofa Entertainment, Inc. v. Dodger Productions, Inc., USDC C.D. California, July 12, 2010
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Sofa Entertainment, Inc. (“Sofa”), plaintiff in this copyright infringement action, owns the copyrights to a number of television shows, films, and musical recordings, including the entire library of the Ed Sullivan Show, a popular television program that featured various musical acts, including the Four Seasons.
- The U.S. District Court for the Central District of California held that the display of a seven-second video clip from the Ed Sullivan Show during performances of the musical Jersey Boys was non-infringing fair use.
Defendant Dodger Productions, Inc. (“Dodger”) is the producer of Jersey Boys, a musical based on the lives of various members of the musical group the Four Seasons (the “Musical”). The Musical, a two-hour dramatic work, tells the story of the Four Seasons’ rise to fame and at times incorporates historical footage as part of the performance. At the end of the Musical’s first act, a seven-second clip of a January 2, 1966 episode of Ed Sullivan – featuring Ed Sullivan introducing the Four Seasons – plays on a large screen (the “Clip”). Immediately before the Clip, the Musical’s actors are seen preparing to perform on stage as old-style CBS cameras roll across the stage. In the Clip, Ed Sullivan can be seen striking his signature pose and introducing the band: “Now ladies and gentlemen, here, for all of the youngsters in the country, the Four Seasons. . . .” As Mr. Sullivan waves his hands toward the band, the Clip ends, and the actors in the Musical begin to perform.
Dodger did not license the Clip from Sofa for use in the Musical. In 2008, Sofa filed a complaint against Dodger alleging copyright infringement for the unauthorized use of the Clip. In September 2009, Dodger filed a summary judgment motion on the basis of its “fair use” affirmative defense. Sofa also moved for summary judgment on various issues, including ownership and unauthorized copying.
In assessing Dodger’s claim of fair use, the District Court turned to the four statutory fair use factors set forth in 17 U.S.C. § 107. When analyzing the first factor – purpose and character of the use – the District Court noted that there were three different considerations subsumed within the first factor: the general purpose or character of the use, whether the use was “transformative” and whether the use was commercial in nature. The Court held that the Musical is a dramatic production intended to entertain, which weighed in favor of Plaintiff Sofa. However, the Court went onto to find that the use of the Clip in the Musical was transformative, as it served as a historical reference in the Four Seasons’ career and did not serve the same intrinsic entertainment value as the Clip, which weighed in favor of fair use. In addition, the Court found that the Musical is properly characterized as a commercial endeavor, but because Dodger’s seven-second Clip only featured Ed Sullivan’s introductory remarks and there was no evidence that Dodger used the Clip in the marketing of the Musical, the commercial nature of the use was not accorded great weight.
In analyzing the second “fair use” factor – the nature of the copyrighted work – the Court noted that it was a close call whether television footage was creative in nature or more properly characterized as newsworthy events. It did, however, find that the fact that the episode of the Ed Sullivan Show at issue had already aired tipped the second factor slightly in Dodger’s favor.
For the third “fair use” factor, the Court considered the amount and substantiality of the portion of the Clip used in relation to the copyrighted work as a whole. The Court rejected Sofa’s argument that the “heart” of the Ed Sullivan Show was Ed Sullivan’s introduction of musical acts, and instead found that the heart of the show was the musical acts themselves. In addition, the Court noted that the Clip was a brief historical reference in a two-hour musical production. Therefore, the Court found that the third factor weighed in Dodger’s favor.
Finally, the Court examined the fourth “fair use” factor – the effect of the use upon the potential market for or value of the copyrighted work. In other words, the Court considered whether the unauthorized use competes for a share of the market for the original work. The Court first acknowledged that two facts – that the Clip was used for primarily entertainment and the use was commercial – weighed against a finding of fair use for the fourth factor. Ultimately, however, the Court found that the fourth factor weighed in favor of fair use as Sofa introduced no evidence demonstrating that it currently licenses (or plans to license) the Clip, and the Court agreed with Defendant that the notion that any such market could ever materialize was speculative at best.
After addressing each individual factor, the Court proceeded to weigh the factors in light of the purposes of copyright. The Court found that there were components in the first factor that weighed for both Sofa and Dodger. As the three remaining factors weighed in favor of fair use, the Court held that Dodger’s use of the Clip qualified as “fair use.” As this finding was dispositive, the Court declined to rule on plaintiff’s motion for summary judgment.
Novak v. Warner Bros. Pictures, LLC, et al., USCA, Ninth Circuit, July 15, 2010 (not for publication)
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Plaintiffs Deborah Novak, John Witek, and Witek & Novak, Inc. hold the copyright in Ashes to Glory, a documentary film that portrays the rebuilding of Marshall University’s football program after it lost all but a handful of its players, coaches, and prominent supporters in a disastrous plane crash in 1970. Defendants Warner Brothers Pictures and several related parties produced the dramatic film We Are Marshall, which is based on the same historical facts as Ashes to Glory. Plaintiff filed suit against defendants alleging copyright infringement, breach of contract, and unfair competition. The district court granted summary judgment (previously summarized by us) in favor of Warner Brothers on all claims, concluding that plaintiffs failed to raise a triable issue of fact regarding the copyright claim because Plaintiffs could not demonstrate substantial similarity between the subject works. Plaintiffs appealed and the Ninth Circuit affirmed, holding that the two works are not substantially similar.
- Ninth Circuit affirms grant of summary judgment in favor of Warner Brothers on copyright infringement and breach of contract claims.
The Ninth Circuit initiates its analysis by stating that proof of infringement requires a fact-based showing that We Are Marshall and Ashes to Glory are substantially similar. In comparing the concrete elements between the two works, the court focused on articulable similarities between the plot, themes, dialogue, mood, setting, pace, characters, and sequence of events. Except for matters of historical fact, the court found that these elements of the two works are not substantially similar.
Plaintiffs first asserted that the district court imposed an improperly severe “bodily appropriation” standard of infringement. As evidence of the district court’s improper standard, plaintiffs pointed to the district court’s reliance on a quote in Narell v. Freeman, for the proposition that “historical facts and theories may be copied, as long as the defendant does not bodily appropriate the expression of the plaintiff.” In rejecting this argument, the Ninth Circuit held that neither Narell nor the district court substituted the “bodily appropriation” standard for the “substantial similarity” standard.
Plaintiffs also argued, under the “inverse ratio” rule, that the quantum of proof required to show copying is ostensibly lessened because defendant had full access to Ashes to Glory before producing We Are Marshall. The Ninth Circuit, however, stated that “‘no amount of proof of access will suffice to show copying if there are no similarities’ between the protected expressions in the two works.” Even under a relaxed standard, explained the court, the requisite similarities must be concrete and articulable. The only concrete or articulable similarities between Ashes to Glory and We Are Marshall, wrote the court, consist of unprotectable scènes à faire, and historical facts, which, like all facts, may not be copyrighted.
Plaintiffs also argued that the evidence of substantial similarity may be shown in the sequencing of events in the two films, especially in the two works’ opening montages. Upon comparing the two films, the court disagreed. The Ninth Circuit found that Ashes to Glory differs significantly from We Are Marshall by including the film’s title and many additional shots of the town of Huntington and the university campus in its opening sequences.
Finally, the Ninth Circuit held that the district court did not commit error in granting summary judgment for Warner Brothers on the breach-of-contract claim. In noting that the parties had not reached agreement on the purchase price, the Ninth Circuit emphasized that the failure to reach a meeting of the minds on all material points prevents the formation of a contract. Nor have plaintiffs produced evidence, stated the court, of disclosure of their work under conditions that would permit a jury to find an implied contract.
For more information, please contact Jonathan Zavin, W. Allan Edmiston, David Grossman, Jonathan Neil Strauss, Tal Dickstein or Meg Charendoff.
Westlaw decisions are reprinted with permission of Thomson/West. If you wish to check the currency of these cases, you may do so using KeyCite on Westlaw by visiting http://www.westlaw.com/.
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