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September 2010

Ninth Circuit Rules That Copyright Act Preempts Overlapping Right of Publicity Claim and Company's Sole Employee and Owner Had Infringement Standing, As Films Were Not "Work for Hire"

Jules Jordan Video, Inc. v. 144942 Canada Inc., __ F.3d ___, 2010 U.S.App.LEXIS 17081, 2010 WL 3211818 (9th Cir. Aug. 16, 2010)

Ashley Gasper, an adult film star who uses the stage name "Jules Jordan," is the president and sole owner of Jules Jordan Video, Inc. ("JJV").  In 2005, Gasper and JJV experienced a higher-than-normal rate of return of their DVDs, which prompted an investigation.  The investigation revealed that 144942 Canada Inc. and others produced, distributed, and sold unauthorized copies of Gasper and JJV's titles.  Gasper and JJV sued.

The claims remaining at trial (and subsequently at issue on appeal) were the copyright infringement claim and the violation of Gasper's right of publicity under California law.  After a lengthy trial, the jury found in favor of Gasper and JJV for both claims and awarded them substantial damages.

After the trial, the district court granted the defendants' motion for judgment as a matter of law that Gasper and JJV did not have standing to bring the copyright infringement claim.  The district court reasoned that because Gasper was employed by JJV, the films were "works for hire" under 17 U.S.C. § 101(1); hence, the owner of the copyrights was JJV, not Gasper.  But since the copyright registrations were in Gasper's name, the district court found the registrations invalid, concluding that JJV also did not have standing to bring the copyright infringement claim.

After entry of judgment, defendants moved for a new trial, arguing that Gasper's publicity claim was preempted by the Copyright Act.  The district court, relying on Fleet v. CBS, Inc., 50 Cal.App.4th 1911 (1996) and KNB Enters. v. Matthews, 78 Cal.App.4th 362 (2000), ruled that the right of publicity is preempted by the Copyright Act only when the distribution is made by the exclusive copyright holder.  Accordingly, the district court denied defendants' motion for a new trial.

Right of Publicity Claim
On appeal, the Ninth Circuit rejected the district court's narrow reading of Fleet.  Whether the publicity claim is preempted depends on "whether the rights asserted by the plaintiff are equivalent to any of the exclusive rights within the general scope of the copyright."  Because Gasper's publicity claim was based entirely on the misappropriation of the DVDs and his performance therein, the appellate court found that the publicity claim was preempted by the Copyright Act.

Gasper introduced a new argument on appeal—that the covers accompanying the DVDs used his name and likeness.  However, the appellate court also rejected this argument.  Factually, the appellate court explained, the only pictures that appeared on the DVD covers were "still shots" of the protected films.  Legally, the copyright of the underlying work extends to the cover. 

Accordingly, the Ninth Circuit reversed the district court's holding and vacated judgment against defendants for violation of Gasper's right of publicity under California law.

Copyright Infringement Claim
The Ninth Circuit also disagreed with the district court's holding that plaintiffs had no standing to bring their copyright infringement claim.  The district court had found Gasper's testimony that the films were intended to be outside the scope of his employment at JJV to be "concocted."  The appellate court, on the other hand, pointed out that "Gasper was the sole officer, director, and shareholder of JJV, exercised complete control over it, and made all decisions concerning JJV and production of the films."  Therefore, "if Gasper intended that his creative work be outside the scope of his employment with JJV, there was no one to disagree."

Further, even if JJV were the copyright owner, filing the copyright registrations under Gasper's name would have been an inadvertent mistake, and such a mistake would not invalidate the registrations.  The appellate court emphasized that copyright registrations are invalidated only if "the alleged infringer relied to its detriment on the mistake, or the claimant intended to defraud the Copyright Office by making the misstatement."  Because the defendants in this case intended to pirate the DVDs regardless of the identity of the copyright owner, the defendants did not rely on the owner information on the copyright registrations.  The appellate court also found that neither Gasper or JJV intend to defraud the Copyright Office, as they both believed that Gasper owned the copyright.  Nor would Gasper or JJV need to defraud the Copyright Office, as one could freely transfer the copyrights to the other if they so wished.

Finally, the appellate court reasoned that 17 U.S.C. § 101 "is designed to establish ownership of a work as between a commissioning party or employer on one hand and the commissioned party or employee on the other.  It would be unusual and unwarranted to permit third parties such as the instant defendants to invoke § 101 to avoid a suit for infringement when there is no dispute between the two potential owners, and both are plaintiffs to the lawsuit."

Therefore, the Ninth Circuit reversed the district court's grant of defendants' motion for judgment as a matter of law as to the copyright infringement claim.  After determining that the district court's error in including certain evidence did not affect the jury's verdict and that the use of the special verdict form did not constitute error, the appellate court reinstated the jury verdict in favor of Gasper and JJV based on copyright infringement.

Practical Effects
Copyright preemption:  While the titles of some summaries indicate that the Ninth Circuit ruled that the Copyright Act preempts a state claim for violation of the right of privacy, it is important to note that the appellate court only made such a ruling because the publicity claim was based entirely on the copyright claim.

Plaintiffs would be well-advised not to automatically assert a right of publicity claim when asserting a copyright infringement claim.  Instead, plaintiffs should consider whether a publicity claim encompasses publicity rights not within the subject matter of the copyright on which the copyright infringement claim is based.

Defendants, of course, would benefit from characterizing a publicity claim as being based entirely on a federal copyright infringement claim.

Infringement standing:  The Ninth Circuit has shown that it will not allow blatant infringers to escape liability based on technicalities, when there is no dispute between the employer and employee as to who is the copyright owner, and both employer and employee are plaintiffs in the lawsuit. 

Infringement defendants, however, need not necessarily abandon hope in attacking technicalities in the copyright ownership.  Arguably, the decision applies to a very specific set of facts, where the plaintiff company was wholly owned and operated by the one other individual plaintiff.  In addition, the defendants in this particular case likely inspired little sympathy as blatant counterfeiters.

Infringement plaintiffs, on the other hand, may want to use this case to counter technical attacks as to copyright ownership and emphasize the inequity of allowing the defendants to escape liability based on such technicalities.

Please click here to read the court's opinion.  

Intellectual Property

Yuo-Fong Amato
Susan B. Meyer


Intellectual Property