Google: The New Public Library?

I suspect a fair number of people are really struggling with the proposed settlement between Google and the Author’s Guild over the wholesale scanning of more than 10 million copyrighted works.  At the heart of the settlement is a compromise that would allow authors to financially benefit from the sale of their works as a result of the Google index.  This would in turn allow Google to provide an index to these works that would be searchable using the google search engine.

The original thesis that permitted, according to Google, an “opt out” system for scanning and indexing these books was that Google’s use was a “fair use” as that phrase is defined within U.S. copyright law.  See 15 U.S.C. § 107.  Libraries, for example, acquire and make paper books available to the general reading public for loan.  Academics and journalists are specifically identified as “fair users” of the copyrighted works of others within the statute; these kinds of uses are recognized by federal law as having general utility that should be encouraged, in spite of the monopoly otherwise enjoyed by authors of works.  Google probably does not fit within any of the specifically mentioned groups.  Google is a very large, international, for-profit company that provides web search and related web services to internet users.

And, as has been spelled out in a number of federal cases on fair use, exploiting the works of another protected by copyright for profit and without paying the “customary fee” to the author almost always spells “not fair use.”  In this case, Google has reproduced wholesale into digital form the works of others without paying them any compensation.  Google’s activities are presumably part of its mission as a for profit entity.  One would anticipate that Google would be able to expand its AdWords presence to searches that turn up digital copies of the works that it scanned, and that Google could therefore gain a profit from these ads, without necessarily compensating the owner of the work whose content helped Google in getting its ad revenue.  Not fair use if we are all reading the same statute.

Nor is the phrase “opt out” found anywhere in the statute on fair use.  A copyright owner is not required to “opt out” of an infringer’s database in order to protect or reserve his rights in restricting how the work is reproduced or duplicated.  Implementing such an opt out system does not necessarily make the subsequent use a “fair use” under the Copyright Act.  For Google, I’m presuming that they would have argued that there were other overriding policy objectives that supported their project of scanning and indexing all of these books and placing them into the hands of internet searchers.  Perhaps chief among these is that Google was simply creating version 2.0 of the local public library, bringing more content to the more than one billion internet users that might be looking for an otherwise unretrievable work.  We actually pay (through taxes, at least for public libraries) the use that our brick and mortar libraries make of copyrighted works, why not tolerate a better library that its users by and large do not pay for (except by tolerating the ads that appear unctuously alongside search results)?

From a technical perspective, Google is absolutely right about its search engine as compared to the typical card catalog at the local library.  Google wins hands down.  When you consider that the majority of these books are out of print and hard to come by (about 3-4 million books are in print at any one time in the world), the settlement proposed would put back into “print” of a sort a whole lot of books that are otherwise hard to find unless you go to some “old school” library and use their card catalog.  Google’s index, however, improves the library card catalog, because the card catalogs are generally useful if you are already aware of the work, or the work happens to be cross-indexed in a meaningful way in relation to how you are searching the catalog.  Most catalogs in libraries are not full text indexes of the individual works in the library, so a google index would represent a huge leap forward for finding material online.

However, the legal argument (to the extent one has been made – Google entered into settlement negotiations promptly with the plaintiff such that Google has not had to file much in response to the Complaint) appears a little wanting.  Financially, most authors will probably be satisfied with the relatively small settlement amount per book, and the potential share of revenue for actual book sales through the Google service.  But the problem with the settlement for some is that they can get a better financial deal than Google is going to offer them.  Hopefully these authors will simply opt out of it to allow those authors that want to participate the option to do so.  But I think there is trouble ahead for this group of authors in the longer term as a consequence of what Google has been doing with its indexing.

This project poses a larger question that is aimed at the fundamental structure of what the Copyright Act protects in intellectual property: how authors can actually get paid for writing works in light of the free availability of huge amounts of information on the internet.  In years past, it was much easier to control access to information published in books, which provided a way to get paid via book sales.  I’m sure more popular books were plagiarized and reproduced without authorization of the publisher, but mass reproductions of a popular book would generally cost real money, which would limit the number of persons willing to engage in such wholesale theft.  Generally, in a paper world, authors had a way to generate revenue from book sales and royalties that was protected by the Copyright Act.

The internet has altered the level of accessibility to information.  Post 9/11, many U.S. government agencies and larger private companies began slimming down the amount of information available online (I guess posting our nuclear launch codes on the interweb was not so smart!) that was posted as part of transparent governance and the culture of openness encouraged by the internet.  However, in spite of a more security-conscious culture, the overall internet’s content continues to grow.  The information available in the written works of the world’s authors, especially highly searchable content from these works, would add substantially to the value and utility of the internet.  But can authors make a living if the information in their works is free?  Will authors continue to write works as a “hobby” and will this reduce the extent and value of works written in the future?  Can new works be written that are supported by advertising (e.g., Google Adwords on blogs)?

The “free” value of things available on the internet is challenging many of us to make a living in a new way.  And I think as a result, authors may need to seriously reconsider how they will survive as well.  To a certain extent, those that sit down to write a book must have (or develop through writing) some expertise in the subject matter for the book to have utility (not always true, but more often than not there is a correlation between authorship and subject matter expertise).  Our economy is benefitted by the high availability of specialists and experts that can help us beyond what we might self-educate ourselves about via internet research.  So there is value to the economy as a whole to the extent that authorship encourages the development of expertise.

The works created through this process also have intrinsic value to the economy to the extent that they are available for public consumption.  I certainly learned a fair amount about virtualization, for example, by reading white papers and other freely available articles online.  However, in spite of my self-education online, I would not have been comfortable implementing virtualization in a production environment without help.  Our project was benefitted greatly by the wisdom and experience of a technology professional that implemented these systems on a regular basis.  Perhaps this is how authors can make a living – by reselling their expertise in their field to more educated internet users that found the author through a Google book search.  But for those of you counting on royalty payments to make a living until 70 years after your death, I think Google is going to put you out on the street looking for a job!

Here are some links to several CNET stories that discuss the details of the proposed Google settlement.

CNET Story

CNET Story 2

CNET Story 3

Google and Copyright Infringement

Google, back in 2004, began an endeavor to index the contents of an enormous number of books through its search engine, so that google users would be able to full text search books that were otherwise unpublished on the internet.  Under U.S. Copyright law, books that were published before the 1920’s (and certain texts published after that time that did not comply with the renewal requirements and were not saved by the Copyright Act of 1976) are in the public domain and can be freely copied without the need of prior consent or the paying of royalties to the author or his/her estate.  Hence, you can find a copy of Edward Gibbon’s Decline and Fall of the Roman Empire on google’s book search, because Mr. Gibbon originally wrote the manuscript well before the earliest date that the book could be protected by current U.S. Copyright law.  Of course, what got google into trouble was not long dead authors but very alive ones (or ones whose estate or a third party owned a valid copyright to the work), which led to a lawsuit against google in federal court in 2005 by several named plaintiffs and an association, the Author’s Guild, who represents over 8,000 other authors.  The Author’s Guild, et. al. v. Google, Inc., 05 CV 8136 (S.D.N.Y. Sep. 20, 2005).

The complaint in 2005 alleged that google’s indexing of these books without paying a license fee to the individual authors with valid copyrights was copyright infringement writ large, and that the indexing was done in search of advertising revenue (an expressly commercial purpose).  Infringing the valid copyright of another without paying the customary license fee is the sine qua non of an unfair use, and I suspect that were we to see this tested in a court, google would likely have lost the suit.  However, the case didn’t get very far as the parties entered into negotiations to settle the matter.  In 2008, a proposed settlement was announced (see a CNET article here) which would have had google pay the Author’s Guild about $125 million in royalties for google to continue its “exploitation” of works that were probably protected by copyright.

This settlement has not set well with others that are concerned that google’s book collection looks a tad monopolistic (including the Department of Justice, who opened an antitrust investigation according to Reuters).  There is concern in the online community that google may have control of too much information which may ultimately stifle innovation by others.  Monopolizing a market generally violates the Sherman Anti-Trust Act, which can lead the Department of Justice to file suit against the alleged monopolizer.  Such suits have caused large companies like IBM and AT&T to either stop seeming to be monopolies, or to breakup outright into smaller units.  Last year, anti-trust concerns stopped google from establishing a search marketing relationship with yahoo, even though google was probably not trying to control the world of search but just trying to help yahoo fend off a purchase by Microsoft (which ultimately did fail and subsequently led to the ouster of Yahoo’s CEO and a founder Jerry Yang, later in 2008).

Ironically, holders of a valid copyright exercise a legalized monopoly over the thing copyrighted, which, while limited to the duration of the author’s life plus 70 years, is a relatively long time.  For highly valued items, such a monopoly could effectively stifle innovation, at least for those that wish to make derivative works from the copyrighted work but cannot afford to pay the “customary fee” to the copyright holder.  Effectively, the copyright holders represented by the Author’s Guild are one set of monopolists fighting with another alleged monopolist, google, which is probably far larger, but probably not otherwise more or less sympathetic.  On the other hand, the copyright monopoly does have limits built in to the rights granted under the Copyright Act itself, including fair use under section 107, which provides for some academic and non-profit expression by individuals who would otherwise be copyright infringers.  Against google’s alleged monopoly of online information, only a very large sum of money to invest in a competing search engine can offset the market that google now controls in search traffic and search advertisements.  There is no “fair use” exception to google’s alleged monopoly over information that would balance the playing field.

In years past, the anti-trust branch of the Department of Justice may have tried to break up a monopoly and/or have a governmental agency regulate the resulting company(ies).  For example, in Maryland, the Public Service Commission is responsible for watchdogging the utility and phone companies.  Verizon, which operates in several states including Maryland, is a smaller version of AT&T from the 1970s (or perhaps larger given the overall growth in telecommunications in the U.S. over the last thirty years).

The question to be answered is whether Verizon is any more responsive to customers today than AT&T was before the big break up, and whether Verizon is any less stifling of competition and innovation than its predecessor, AT&T.  Answering these questions may help to answer whether google ought, as a matter of policy, to be broken into smaller operating groups and/or regulated by the federal government like an “internet utility” company.

With regards to responsiveness, this is a hard question to answer.  A regulated utility like Verizon is still a very large entity, and as a matter of statistics, Verizon will make a substantial number of errors in service provision and billing that will lead to user complaints.  I don’t have any hard data on complaints over time or resolution rates to compare pre- and post-break up of the entity.  And as to google, I’m not sure that this is much of an issue.  The truth is that there are other search engines in the market today, and it is very easy for an internet user to access these search engines.  They may not have the same content indexed, but all of them use some form of search advertising to help subsidize your ability to freely search on them (or you have to pay a subscription fee to use them).  The state of search today may not really compare with the customer service issues of telecom customers of years past that were stuck working with the Baby Bell to get their phone to work properly.

With regards to the problem of stifling competition, the telecommunications bust at the beginning of this century was in part the result of the Baby Bells like Bell Atlantic/Verizon who controlled the last mile infrastructure that connected competing telecoms to customers.  After a century, the Baby Bells had so much more invested in the public phone and data networks that no small start up could possibly compete.  And whether court-ordered or not, the engineers at Verizon were not going to make a competitor’s service request a higher priority than servicing direct Verizon customers.

So, if the equivalent of this is for google to keep its database of indexed books but simply share access to other search engines, I doubt the outcome would be much different – most people trying to find a book would get a better response from google’s search engine than a competing search engine.  Alternatively, if google were required to publish its search engine algorithms and code, how long and how much money would it take for a competitor to grow to sufficient size to accumulate the scope and depth of data that google now handles every day?  Ten years?  Twenty?  And would the internet be a better place because there are two identical search engines? This is like when there were two different paper phone books.  Other than the additional tree casualties, I don’t think the public was better served with two phone books, and I doubt having two identical databases on the internet of web sites would be much better, either.

What about an Internet Public Service Commission?  For the phone company, the PSC in each state is empowered to receive and investigate complaints from customers – typically about a billing problem, but the PSC investigators examine related issues as well.  My experiences with the PSC here have been positive.  The PSC’s opening of an investigation usually gets my complaint to the right person at Verizon, who is then able to resolve the problem that the customer service representative was either not empowered to resolve or unwilling to resolve.  What, then, would the IPSC be charged with handling from the public about google?  Lost documents in the internet cloud that were stored with google?  Google’s search crawler doesn’t search my site quickly enough?  My web site doesn’t show up in search results high enough based on my keywords?  Security breaches at google?

I suppose another solution would be to make google a national library and attach it to the Library of Congress, which could use the google revenue stream to pay for scanning and indexing everything in the Library of Congress to make it generally available to the public.  Unrelated parts of google could be spun off as private enterprises that would not operate with public money or public regulation (such as the cloud computing aspects of google).

Stay tuned for developments!

Health IT & Open Source

The truth is that I may just be getting annoyed about this debate.  A recent blog posting on Wired (click here for the article) frames the debate over health technology in terms of open source versus legacy or proprietary code, the latter being the enemy to innovation, improved health outcomes, and usability.

First off, an open source program is merely governed by some version of the GPL, which means that other developers can reverse engineer, make derivate works, or otherwise include your open source code in their subsequent open source code.  Developers that freely work together to write something cool are developers writing code.  They aren’t necessarily health experts, physicians, efficiency gurus; in fact, they may not even have health insurance if they live in the U.S. (1 in 6 of us are uninsured).  The fact that code is open source does have a big impact on how U.S. copyright law protects the work, but it doesn’t mean that somehow an open source developer is more in tune with health IT requirements, how to best integrate the system into a physician’s practice, or even necessarily what the actual requirements are for a physician to see a patient and document the visit to avoid liability for fraud or malpractice.  That’s because for developers, requirements come from outside of the development community, from users.

And guess what – proprietary developers of software listen to their user community to understand their requirements.  It’s part of the job of developers, regardless of whether the code is open source or proprietary.  And, for everyone participating in the global economy, the people that pay for your product generally drive the features and functionality in it.  If you can’t deliver, then your user base will go find someone else who can deliver.

Now, for larger health organizations, health records systems are a multi-year investment.  This inherently locks that health organization into a longer term, and more conservative, relationship with their health IT vendor, which tends to reduce the amount of change introduced into a health records system over time – especially for the larger vendors that have a lot of big clients.  The little developer out there writing code at 3am is certainly going to respond to market changes far more quickly than a really big corporation with a health IT platform.  But you know what?  Try getting the little guy to support your 500 desktop installations of his software 24×7.  Do you really think he can afford to staff a help desk support function around the clock for your business?  What happens when he has two customers with emergencies?  Or he wants to get some sleep?  And what about change control?  Even big vendors stumble in testing their code to make sure it works and is secure before releasing it (think Microsoft).  Solo, open source developers, even working in informal teams, are going to miss at least as often as a larger vendor, and introducing a lot more changes just increases the frequency that an untested change becomes an “unpublished feature” aka “blue screen of death.”  Trust me on this one: the health care user base is not going to be very tolerant of that.

Repeatedly, I hear the refrain that this stimulus money is going to go to systems that can be put to a “meaningful use,” and that is going to exclude rogue open source Health IT developers from being funded, squelching innovation in the market place.  I imagine that complying with the security regulations under HIPAA probably hinder innovation, too, but they increase the reliability of the system vendors that remain in the market place and reduce the risk to the data of patients that might be in their computer systems.  Setting minimum standards for health records systems may favor incumbent systems, but honestly – is that so wrong?  Isn’t the trade off here that when someone buys a system that is certified, they can have the satisfaction of knowing that someone else without a vested interest in the product, thought it had certain features or a proven record of delivering certain outcomes?  Perhaps the certifiers aren’t neutral because they come from the industry of EHRs, but if I recall correctly, the people that run the internet have committees with representatives from the internet industry, yet I rarely hear that the standards for the POP3 protocol unfairly burden new or open source developers.

That someone set standards for EHRs like a government agency is a lot like the government setting the requirements for you to receive a driver’s license.  Everyone who drives needs to understand what the red, octogonal sign with the capital letters S T OP means.  On the other hand, you may never parallel park again, but you better learn how to do it if you want your license to drive in Maryland.   Standards are always a mixed bag of useful and not-so-useful rules, but I don’t think there are too many people out there arguing that the government should not set minimum standards for drivers.  A certification requirement for EHRs to establish minimum standards is no different.  Ask the JCAHO people about it.  Ask the HIPAA police.  Ask the IT people you know.  If you are going to develop an EHR, you better secure it, make sure the entries in the database are non-repudiatable, and have a disaster recovery approach.  Don’t know what these things are?  Do your homework before you write a computer system.

Now, another refrain has been that look at how all of these proprietary systems have failed the world of health provisioning.  For example, look at how more kids died at the Children’s Hospital ER in Pittsburg after the hospital implemented an EHR (I can feel a class action lawsuit in federal court).  Who implements EHR’s in ER’s?  So the doctor is standing there and a patient is having a heart attack.  What should the doctor’s first act be?  To register the patient into the EHR and record his vitals?  I would think the doctor should be getting out the paddles and worrying about the patient’s heart beat, but then, I am an attorney and systems guy, not a physician.  Look – dumb decisions to implement a computer system should not lead to subsequent critics blaming the computer system for not meeting the requirements of the installation.  EHR is not appropriate every place patients are seen or for every workflow in a health care provider’s facility.  No knock on the open source people, but I don’t want my ER physician clicking on their software when I am dying in the ER, either.  I don’t want my doctor clicking anything at all – I want her to be saving me.  That’s why I have been delivered to the ER.

Now, VistA is getting a lot of mileage these days as an open source, publicly funded, and successful example of EHR in action.  And it is free.  But in fairness, VistA is not a new piece of software recently written by three college kids in a garage somewhere in between World of Warcraft online gaming sessions.  This program has been in development for years.  And “free” is relative.

For example, if you want support, you need to pay for it.  If you want to run it in a production environment, you will need to buy equipment and probably get expert help.  If you want to implement it, you will need to form a committee, develop a project plan, implement the project intelligently with input from your users, and be prepared to make a lot of changes to fit this system (or any system) into your health facility’s workflows.  And if you find yourself writing anything approaching software, that will cost you something, too, as most health care providers do not have a team of developers available to them to modify any computer system.  So, “free” in this context is relative, and genuinely understates the scope and effort required to get any piece of software to work in your facility.  “Less” may be a more appropriate adjective.  But then, that’s only true if you can avoid costly modifications to the software, and so far, there is no single EHR system that works in every setting, so expect to make modifications.

That’s my rant.  Happy EHR-ing!

RIAA & Copyright: $2 Million Fine Whacky Consequence of Copyright Act

The RIAA, in a new trial of an alleged copyright infringer who had shared 24 songs via the file-sharing service Kazaa, won almost $2 million in fines against the defendant calculated on the basis of statutory damages under the U.S. Copyright Act.  (See the Wired Story here)  This is an almost ten fold increase in the fines awarded to the RIAA against Thomas-Rassert from the original trial in 2007.  The basis for these fines is a provision of the Copyright Act, codified at 17 U.S.C. § 504(c)(2), which allows for a maximum fine of $150,000 on the finding of willful infringement by the defendant.  Statutory damages are available to a plaintiff who elects to not seek actual damages for the infringement proved during the trial.

In this case, the defendant Thomas-Rassert had been sharing 24 songs online.  Assuming that she had a typical aDSL connection where the upload speed is considerably slower than the download speed, and the average size of each file shared was about 3 megabytes, she would have been able to share about 0.22 songs per minute to other users of Kazaa.  If each song would have cost $1 to purchase as a single from a reputable vendor (like itunes), and she shared these 24 songs continuously for a year, the amount of lost sales to the music industry would have been about $115,632 (with about 20% of this going to the reseller and not the music companies), or about 1/20th of the damages award against her for her infringement of the plaintiff’s copyrights.  Thomas-Rassert’s own estimate of the actual damages proved by the plaintiff was even smaller – on the order of $150.  (See the filing seeking remittitur after the original trial resulted in a $222,000 verdict against her)

I certainly do not condone copyright infringement, but the damages sought by the RIAA in this case are highly disproportionate to the alleged injury to the copyright holders.  Seeking such a large fine against an individual reflects to me, at least, the frustration the RIAA has had in pursuing the makers of the file sharing platforms directly, many of whom are either out of the RIAA’s legal reach or otherwise judgment proof.  While I would not call Thomas-Rassert an “innocent infringer,” nor a “fair user” given the prior Supreme Court jurisprudence holding otherwise, I also would not call her a “pirate” worthy of the civil version of a hanging, either.  Let’s hope the judge has the good sense to reduce the fines to a more reasonable level.

Trademark Infringement & Starbucks

Starbucks is a well known, international purveyor of coffee products, with thousands of stores throughout the world.  Starbucks v. Wolfe’s Borough Coffee, Inc., No. 01 Civ. 5981 (LTS)(THK), 2005 U.S. Dist. LEXIS 35578 (S.D.N.Y. Dec. 23, 2005) (Starbucks I).  Starbucks Corporation was formed in 1985 in Washington State, after the original founders had been in business for themselves since 1971 in the Seattle Pike’s Place Market.  Id. at *3. Under a traditional trademark analysis, Starbucks has spent a substantial amount of money to market its coffee products worldwide (over one hundred thirty-six million dollars worth from 2000-2003).  Id. at *5.  One should not use a trademark similar to “Starbucks” without expecting trouble.

In 2004, Wolfe’s Borough Coffee, a small coffee manufacturer that distributes its brands in a store in New Hampshire and through some New England supermarkets, was sued by Starbucks in the southern district of New York for trademark infringement and dilution under the Lanham Act and state law.  Id. at *6.  Wolfe’s Borough Coffee was trading with two allegedly infringing names: “Mr. Charbucks” and “Mister Charbucks,” both similar to the trademark “Starbucks” used by the famous coffee house of the same name.  Starbucks v. Wolfe’s Borough Coffee, Inc., 559 F. Supp. 2d 472 (S.D.N.Y. June 5, 2008) (Starbucks III).  Yet, Starbucks lost in district court on all of its claims.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *29.  Starbucks appealed, the second circuit reversed in 2007 because of a change to the Lanham Act in 2006 by Congress through the Federal Trademark Dilution Act, and the trial court affirmed its prior decision in favor of the defendant in 2008.  Starbucks v. Wolfe’s Borough Coffee, Inc., 477 F.3d 765 (2nd Cir. 2007) (Starbucks II); 15 U.S.C. §§ 1125(c), 1127 (2008); Starbucks III.

Starbucks Claims

Starbucks sued Wolfe’s under federal and state law, alleging trademark infringement under sections 1114 and 1125(a) of the Lanham Act, trademark dilution under sections 1125(c) and 1127 of the Lanham Act and also under New York law, and unfair competition under state common law.  15 U.S.C. §§ 1114(1), 1125(a) (2008); Id. at §§ 1125(c), 1127; N.Y. Gen. Bus. Law § 360-1 (1999).  This case note will focus on the allegation of trademark dilution.

In order to prove trademark dilution, the plaintiff must demonstrate that (a) the plaintiff’s mark is famous, (b) the defendant is using commercial use of the famous mark, (c) the defendant’s use came after the plaintiff’s use, and (d) the defendant’s use of the plaintiff’s mark dilutes the plaintiff’s mark.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *22.  The defendant had conceded the first three elements leaving only the last element of the rule in dispute.  Id.

Moseley v. Victoria’s Secret Catalogue, Inc., 537 U.S. 418, 433 (2003) requires a plaintiff to prove actual dilution rather than a likelihood of dilution in order to prevail under the Lanham Act anti-dilution section.  New York law is less stringent than federal law in this area, and the court reasoned that if the plaintiff could not prevail under state law, it also could not prevail under federal law.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *25.  The court examined the likelihood that the defendant’s use of its marks would either blur or tarnish the plaintiff’s marks, and concludes that plaintiff could not prevail under either standard.  Id. at *30.  Blurring occurs when a defendant uses the plaintiff’s mark to identify defendant’s products, increasing the possibility that the plaintiff’s mark will no longer uniquely identify plaintiff’s products.  Id. at *25.  Tarnishment occurs when a plaintiff’s mark is associated with products of a shoddy or unwholesome character.  Id. at *26.

The court’s review of the record caused it to conclude that the plaintiff had failed to demonstrate actual or likely dimunition “of the capacity of the Starbucks Marks to serve as unique identifiers of Starbucks’ products…” because the plaintiff’s survey results did not show an association with the defendant and the mark “Charbucks,” only that respondents associated the term “Charbucks” with “Starbucks.”  Id. at *27.  The court also held that the plaintiff’s survey results did not substantiate that the mark “Charbucks” would reflect negatively on the Starbucks brand.  Id. Plaintiff therefore lost on its dilution claims.

Change in Dilution Act

Prior to 2006, dilution of a famous mark required that the plaintiff demonstrate actual dilution to prevail under section 1125(c) of the Lanham Act.  Moseley, 537 U.S. at 433.  However, Congress amended the applicable statute to only require that the defendant’s use was “likely to cause dilution.”  Starbucks II, 477 F.3d at 766.  The second circuit held it was not clear if the amended Lanham Act’s prohibition of dilution of famous marks was coextensive with New York law, the latter being the basis for the trial court not finding dilution of Starbucks’ marks.  Id. Therefore, the appeals court vacated the trial court’s judgment and remanded for further proceedings.  Id.

On Remand

The district court took back up the Starbucks case under the amended anti-dilution statute.  To demonstrate blurring of a famous mark, the amended Lanham act requires a court to consider all relevant factors including: “(i) [t]he degree of similarity between the mark or trade name and the famous mark[;] (ii) [t]he degree of inherent or acquired distinctiveness of the famous mark[;] (iii) [t]he extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark[;] (iv) [t]he degree of recognition of the famous mark[;] (v) [w]hether the use of the mark or trade name intended to create an association with the famous mark[;] and (vi) [a]ny actual association between the mark or trade name and the famous mark.”  Starbucks III, 559 F. Supp. at 476 (citing 15 U.S.C. § 1125(c)).

Degree of Similarity

The district court held that a plaintiff must demonstrate under this element that the marks are very or substantially similar.  The court pointed out that the defendant’s marks appear on packaging that is very different from the plaintiff, and the defendant used the rhyming term “Charbucks” with “Mister,” where Starbucks appears alone when used by the plaintiff, therefore the court found this factor to weigh against the plaintiff.  Id. at 477.

Distinctiveness of Starbucks Mark

Given the extent of the use of the Starbucks mark by plaintiff and the amount of money expended by the plaintiff in its marketing program, the court found this factor favored the plaintiff.  Id.

Exclusive Use by Starbucks
The fact that the plaintiff polices its registered marks, and the amount of money spent on using the mark both led the court to weight this factor in favor of the plaintiff.  Id.

Degree of Recognition of Starbucks’ Mark

Again, given the longevity and number of customers that visit Starbucks stores, the court found this factor to favor the plaintiff.  Id.

Defendant’s Intent to Associate with Starbucks’ Mark

The court finds that while the defendant intended to allude to the dark roasted quality of Starbucks brand coffees, the fact that the marks are different and the defendant had not acted in bad faith led the court to weigh this factor in favor of the defendant.  Id. at 478.  The court reasoned that the defendant used this mark to distinguish its own lines of coffee products, with the Mr. Charbucks brand being the dark roasted coffee as compared to other Wolfe’s Borough/Black Bear coffees.  Id.

Actual Association with Starbucks’ Mark

Here, the court found that while there was an association with the Starbucks’ mark to some respondents to the survey conducted by Starbucks, this association alone is not enough to find dilution.  Id. Instead, the court found that the defendant’s marks would not cause customers to confuse the defendant’s products with the plaintiff’s.  Rather, customers would tend to see the playful reference to a quality of Starbucks’ coffee – the dark roast – to distinguish one kind of Wolfe’s Borough brand coffees from other Wolfe’s Borough brand coffees.  Id.

Tarnishment Analysis

The amended Lanham Act also provides a specific definition for dilution by tarnishment: “[an] association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.”  15 U.S.C. § 1125(c)(2)(C) (2008).  The court held that the plaintiff’s survey evidence could not support a finding of dilution by tarnishment, because the plaintiff’s survey was susceptible to multiple and equally likely interpretations.  Starbucks III, 559 F. Supp. at 480.  In addition, the court found that the defendant’s coffee products were not of actual poor quality, so any actual association between the defendant’s coffees and Starbucks would not likely be damaging to Starbucks.  Id.

As a result, Starbucks lost its case on remand for trademark dilution.  One might almost say that Starbucks has become so synomous with quality dark roasted coffees that their brand name can’t be diluted by other quality coffee brands.  Instead, the Starbucks mark is a victim of its own success in the world.  Add that to the list of reasons why a Starbucks on every street corner is not a good idea.

Note: This post was originally published in the Annual Intellectual Property Law Update, volume II, June 2009, Maryland State Bar Association Intellectual Property Section – Publications Committee.

Second Life Avatars and First Life Trademarks

More and more, the body of laws that govern our “first lives” are traveling into the world of Second Life, an online virtual world that allows people to own land, buy and sell products for Linden Dollars, and now, register trademarks based on graphics created by a user in Second Life.  Click here to read the full article.

This should probably come as no surprise, given the strong and growing commercial activity within Second Life.  According to their site, in-world users of Second Life are exchange about USD$35 million each month for virtual goods and services.  First life laws on trademarks were created in part to encourage commerce by helping consumers know the actual source for the goods they were buying.  It seems to me that the next step will be first life businesses like Nike and Rolex seeking a way to enforce their trademark rights in a first life court against Second Life infringers.

Sony ebook reader with google

Sony and Google announed today that Google will be making its online PDF library of public domain works available through Sony’s epub reader. Google has well over 500,000 books online as a result of its work to scan public domain works into digital format.

I have used Google’s book search for historical research and it is a great tool for finding books published before 1925. The search tool also gives you results for materials still under copyright but not the entire book in PDF. Will Sony’s reader come in an iPhone flavor? Maybe, but not just yet.

Google Targets Targeted Ads

Big brother is watching your every move on the internet.  And, by “big brother,” some privacy experts mean Google, the internet search engine with a majority of all searches online.  According to Yahoo News (click here for the story), Google has begun a new advertising campaign that uses where you have been to present advertisements to you from AdWords advertisers.  So, for example, if you had previously visited my web site,, and were searching for legal services next month, you might see my Google ad show up in your Google search results, where another user that had never been to my site might not see the same ad.  Read Google’s Blog here.

The controversy for privacy advocates is that people other than you have access to your web history, regardless of whether you wanted those other persons to have access or not.  It is kind of like the FBI agent walking over to the public library and printing out a list of all the books you have taken out in the last year – most patrons of the library (way back in the good old days before the Patriot Act) just would not expect the government to be investigating what books they were reading.  Of course, most of us also probably don’t get all that upset about it, unless the cops have a warrant and are banging down our door at home!

What’s different about this situation, however, is that Google is not a government agency (though Google, like other service providers do comply with warrants from government agencies, or the laws of other nations where they operate, including some of those dictatorships who shall not be named, but whose country’s name rhymes with Whina).  And, Google’s advertisers are generally just other businesses looking for customers.  I think that we have gotten over the commercialization of the internet.  We’ve been living with stupid advertisements from stupider products now for some time.  I imagine that Billy Mays is probably living in your subconcious, too, but it just makes me bound and determined to never buy any crap that guy is pushing on those TV commercials.  I mean, how often do you have a torn US flag that you repair and want to fly in a wind tunnel (even sixty mile per hour winds will not drown out Billy!).

So, if you go to a web site selling that crap, and search for things like that crap on Google, that stupid web site’s ads will be more in your face than they might otherwise be.  Personally, I think you deserve to be tortured with endless pop up ads for visiting that web site and contemplating supporting Billy Mays’ personal quest to yell at everyone on the planet.  And don’t get me started about ShamWow.  But I digress.

The issue for us users of the internet is how much we are willing to put up with others knowing about us.  I’d be willing to bet most readers of this blog treat the internet as a parking lot under surveillance, and just don’t pay much attention to the cameras.  Our expectations of our privacy on the internet continue to be lowered as social networking and other web sites allow us to live more publicly than ever before.  Google is part of this trend, as is your television, newspaper, trade magazine, your neighbor’s pets, your government – pretty much everybody.  That’s because we need to buy more stuff.  Ask Whina – they are ready to sell you a new flat screen TV that you can hook your internet-enabled new WiFi Macbook Air to while you are reading an advertising-sponsored blog, searching through internet ads on Google for the best deal on the next cool thing.

Coming next month: free clothing sponsored by Google ads that are updated regularly to reflect your geographic location, courtesy of Google Maps!  (Oh John, just been shopping at The Apple Store in Towson, I see…)

Copyright Meet Speech

Check out this article on some of our online service/social networks and the impact that private companies have on our free expression by clicking here.  Certainly the first amendment doesn’t give us much protection in private areas like shopping malls or the private homes of others (or even the sidewalk around the back of a Post Office, for that matter, or a military base if you are an anti-war protester), but online systems like youtube and myspace represent a whole new frontier, entirely governed by private terms of service contracts with individual users.  The Supreme Court has held, as far as copyright is concerned, that the rules on fair use balance an individual’s free expression against the property interests of the copyright holder.  Is fair use a sufficient standard, however, when the determination of fair use is entirely in the hands of an editor at a web site operator?  Especially when there is no clear path to appeal an adverse decision of the operator, and no constitutional remedy?