Tuesday, July 30, 2013

Covering Songs Has Become a YouTube Sensation

As with fan fiction, sometimes a song can inspire others to cover or remix it.  That is what has happened to the song "Blurred Lines" by Robin Thicke.  I am sure you have heard one version or another recently--I was subjected to repeat performances  on a recent trip.  Or, maybe you have heard one of the many homages to Daft Punk's "Get Lucky."  Similar to fan fiction, the evolution from albums to compact discs to downloadable music to YouTube has spawned a plethora of music lovers who cover their favorite songs and create videos.  I am sure you remember this one covering Carly Rae Jepsen's "Call Me Maybe" which made the rounds on Facebook. 

Again, as with fan fiction, this creates a conundrum for the copyright owners of the songs.  Do the owners shut down these cover videos, or do they encourage them?  In some cases, the covers can reach audiences that the original song may not have reached. For example, Vampire Weekend's cover of "Blurred Lines" introduced R&B singer, Robin Thicke, to the indie-rock crowd.  For Mr. Thicke, he may want to encourage such covers in order to facilitate his ability to "crossover," and therefore, broaden his fan base (and hopefully, leading to more sold songs).  Others may want to hold dear their copyright rights and shut down every one of these cover videos unless there is some compensation paid to the artist.  Each artist will have a different take on how they want to handle the situation.

Universal Music Publishing Group ("UMPG") has decided to help fuel this wave of covers by giving these web video musicians access to their catalog.  In exchange, UMPG shares any ad revenue generated by the video with the web artist.  Record labels may try to recruit these online stars to cover one of their artist's songs in order to expand the song's life cycle.  

It appears that instead of fighting the technology evolution, the record labels and publishers have decided to use the evolution to their advantage.  Something they did not do when Napster came about which I believe was a mistake (both at the time and now) because now they are still trying to catch up.  

Tuesday, July 23, 2013

Startup Company Names Make the First Brand Impression to Your Customers

Startups have begun to adopt quirkier and quirkier names in an effort to begin to build their brand right away.  What you may not know is that Yahoo and Google led the way.  Yahoo stands for "Yet Another Hierarchical Officious Oracle" and Google is a mis-spelling of googol the number with 100 zeroes after a one.  Then came Flickr and Tumblr.  Now the names are getting even wackier.  There's Mibblio, Kaggle, Shodogg, Zaarly, Spotify and a whole bevy of others. 

One reason for these types of names is that it helps branding and marketing.  There are several categories of marks with each category giving the trademark owner stronger or weaker protection.  Those categories from strongest to weakest are:  “arbitrary/fanciful,” “suggestive,” “descriptive,” or “generic.”  A coined phrase or made up word would be arbitrary/fanciful and provide the broadest protection because there are no other similar words like it.  A suggestive mark is one that suggests rather than describes a characteristic of the goods/services it represents.  For example, the trademark “Apple” for use with computer-related products would be suggestive.  A descriptive mark is one that merely describes the nature, quality, or character of the goods.  For example the mark “Red Fruit” when applied to an Apple Farm’s product would be descriptive. Generally, in order to obtain trademark protection for this type of trademark, the owner will need to prove that its mark has “acquired distinctiveness/secondary meaning.”  This means that the owner will have to show that consumers actually associate the descriptive mark with the owner’s goods/services and not view it as a description of the product. Finally, a generic term is the common name of a product.  It cannot serve as a trademark at all.  Some famous trademarks that have become the generic term for the product include “Thermos,” “Linoleum,” and “Escalator.” Thus, this trend by startups to create words puts these trademarks at the higher end of the trademark spectrum.  They also help avoid issues with trademark infringement with other companies. The more made up the name, the stronger the trademark.  As with any name or trademark, the object of the exercise is to be sure create a name or a trademark that conveys some meaning to the consumer. In addition, a good trademark should be memorable for the consumer.

Another reason is that these companies need a web address that is easy to remember and recognize. As you may imagine, most of the good or short ones are already registered.  It also helps to have shorter names to make it easier for potential customers to remember.  Commonly, the company will choose a mis-spelling of a word, mash two or more words together, or find some other way to come up with a name that is unique and still conveys a message to the consumer about that company's products or services.

Some companies will use an algorithm to create one word from two or more words. However, it is important to understand how the new name looks or sounds because in some cases the look, sound, orconnotation when actually read or spoken may be unfavorable. 

Overall, this can be a very good trend for strengthening a startup’s trademark.  I cannot tell you how many times my clients have clung to trademarks that were descriptive, rather than suggestive or arbitrary/fanciful which meant that those clients had to work harder to get consumers or potential consumers to associate their trademark with their goods/services.  One downside to this trend, though, is the promulgation of similar types of names.  For example, how many items came out with names that start with “i” after Apple came out with its “iPod” products? 

It is always important to pay attention to your brand and try to “get it right” the first time.  A company does not necessarily want to change its branding image mid-stream (a la go from Research In Motion or RIM to Blackberry). 

Tuesday, July 9, 2013

$ 675,000 for Downloading 30 Songs Illegally

The First Circuit upheld a $ 675,000 award against an individual who illegally downloaded thirty songs.  As you may know, the minimum amount of statutory damages allowed by the Copyright is $750 per infringement. The maximum is $30,000 per infringement. However, in the case of "willful" infringement, the Copyright Act provides for statutory damages "of not more than $ 150,000 per infringement. 
The lower court in the Sony BMG v. Tenenbaum case, awarded plaintiff $ 22,500 per infringement.  Mr. Tenenbaum appealed claiming that such an award was excessive, and therefore, violated his due process rights.  Arguing that the First Circuit should apply a punitive damages analysis to determine the propriety of the award, Tenenbaum sought a determination that the award was excessive.  The First Circuit declined to review the award under a punitive damages analysis.  Instead, it gave deference to the statutory damages set forth in the Copyright Act.  Using this analysis, the First Circuit, in order to find the award violated Tenenbaum's due process rights would have to find that the award was "so severe and oppressive as to be wholly [disproportionate] to the offense and obviously unreasonable."  The punitive damage analysis would have most likely yielded a favorable result for Tenenbaum. 
This begs the question, how is it that the award of $ 22,5000 per downloaded song is reasonable or not disproportionate to the offense?   According to the First Circuit, it thought that the purpose of the statutory damages was to discourage "wrongful conduct" and provide compensation for injury.  Undoubtedly, plaintiff will also seek to recover its attorneys' fees from Mr. Tenenbaum.  Thus, Mr. Tenenbaum's downloading of a couple of album's worth of music will probably cost him a pretty penny.   

Of course, the courts do not ever consider any mitigating factors.  For example, what if after downloading those 30 songs, Mr. Tenenbaum purchased 100 more from the same or similar artists which he would not have purchased had he not liked the thirty songs so much in the first place.  Or, whether Mr. Tenenbaum may have purchased the songs after downloading them?  (Most likely he did not, but what if?). 

While I am all for protection of one's intellectual property, including copyrights, it seems to me that the statutory damages provision of the Copyright Act leads to misuse and abuse.  This is especially true since a copyright registration is probably the easiest of the three (patents, trademarks, copyrights) to obtain.  Seems to me that the better approach to determining the statutory damage amount would be to run it through a punitive damage analysis.  That way, the courts may have greater flexibility in taking into account whether the infringer is a "career" or "professional" infringer or just someone like Mr. Tenenbaum.  

Until then, if you are downloading songs or other copyrighted material, do so from iTunes or Google Play (or other similar application, store, site) and only after paying for it.