Settlement strategy subtlety

I listened to a CD of a CLE today Policing and Protecting Copyrights on the Internet, offered by Strafford.  The participants were David Young and Andrew Bridges, both very experienced copyright litigators.  The discussion briefly touched on Google’s recent settlement with the book publishing industry concerning Google Book Search.

In a nutshell, Google had been scanning copies of books to provide search results of the full text of the books, as well as to provide images of the pages of the books.  Google was doing this without the permission of the authors or publishers of the books, and was claiming that it was fair use.  Eventually, Google settled with the authors and publishers, and the fair use question was never litigated to a conclusion.

It’s obvious that settlement often provides benefits to both parties: the dispute is resolved faster and less expensively, the risk of exposure to excessive damages can be lessened, etc.  During the CLE, though, one of the participants pointed out an additional benefit to Google of settling: whether or not this is fair use was not decided, but Google gets to continue doing it anyway.

Yes, Google could have litigated this to its conclusion, and possibly had this determined to be fair use.  In that case, Google would not have had to pay any royalties or damages in a settlement.  However, the world would now know that this activity was allowable.  By settling, Google keeps the question of whether it is fair use.  In a way, this creates a barrier of entry to those who might want to copy Google’s business model, as they would have to either come to similar terms with the authors and publishers, or they would have to spend their own money in court to litigate the fair use issue instead of free-riding on Google’s litigation efforts.

Thinking back to the Kindle case, this strategy could be another explanation for why Amazon didn’t bother fighting: sure, it could be fair use, but why litigate it when success would just lead to a zillion competitors doing the same thing?

The definitive answer in the Obama poster debate

Stephen Colbert recently hosted a debate between David Ross, former Director of the Whitney Museum, and Stephen’s brother Ed, a partner at Kenyon & Kenyon who specializes in copyright.  This debate produced what I think is probably the definitive answer on how the Shepard Fairey copyright debate should come out.

The money quote:

STEPHEN: Who do you really think is right?

ED:  Who’s paying me?

The Obama Poster Copyright Mess

One of the more interesting things going on in “popular IP” right now is the Shepard Fairey copyright dispute.  This has been blogged about and written about extensively elsewhere, but to sum up where it’s at right now:

1. Mannie Garcia took a photograph of Obama.
2. The AP (maybe) acquired the rights to the photograph from Mannie Garcia.
3. Shepard Fairey copied the photograph and altered it to create the ubiquitous red and blue Obama “Hope” poster.
4. The AP threatened to sue Fairey for copyright infringement, but during settlement negotiations, Fairey filed for a declaratory judgment.

This is another one of those “popular IP” issues where most people read the story and think, “Oh, I heard about this thing called ‘fair use’ one time.  I love that Hope poster!  Therefore, it’s obviously fair use!” 

No.  Well, it’s not obviously fair use, at any rate.