E:\Exams\2002\SPRING~1\Beck_Copyright Law

FINAL EXAM

GOLDEN GATE UNIVERSITY SCHOOL OF LAW

THIS IS AN OPEN BOOK, OPEN MATERIALS EXAM. You may use any notes, books or other written material to assist you in responding to the questions.

There are four (4) essay questions on this exam. The first three questions are worth thirty (30) points each; the last is worth ten (10) points. Answer each question as fully as you can, citing any appropriate cases, public policies, and statutes that are relevant.

DO NOT WRITE ON BOTH SIDES OF THE PAGE. WRITE LEGIBLY OR PRINT IF YOUR HANDWRITING IS DIFFICULT TO READ. If I cannot read your response to a question, your grade will be adversely affected. Remember to put your exam number only (no names) on your exams and blue books. Turn in the exam, blue books and scratch paper at the end of the exam.

QUESTION NO. 1 (30 Points)

Awesome Computer Company has announced plans to merge with Big Green Corporation to form the world's largest electronics company. The merger is opposed by a number of shareholders and has become a major topic in the financial press. Marvin Insider, a product manager for Awesome, has become concerned that he might lose his job as a result of the merger, and writes an unsolicited memo to Awesome's CEO detailing the reasons that he believes the merger should be rejected. Marvin has no responsibility for implementing the merger, and wrote the memo in the evenings at home on a company supplied computer. The memo contains an extensive financial analysis of the costs and benefits of the merger using financial information from Awesome's Annual Report to Shareholders and recommends that the merger not take place because the new company will be less profitable than the pre-merger company. Awesome's CEO, who strongly supports the merger, has ordered all copies of the memo confiscated, and to prevent distribution registers the copyright in the memo as an unpublished work for hire.

Question 1(a): Insider files suit in California Superior Court, seeking a declaration that he is the author of the work and that the work is not a work for hire. Who is the owner of the copyright and what court should decide the issue? Discuss.

Question 1(b): Matt Druck, a well known internet gossip columnist obtains a stolen copy of Marvin's memo and has it posted on his website. Awesome sends a letter to Druck and to Druck's ISP advising them that the work is copyrighted and that continued display of the memo is a violation of Awesome's rights. Assuming that Awesome is the owner of the copyright, discuss the defenses available to Druck and to Druck's ISP.

Question 1(c): Professor Ian Ernest, having read the memo on Druck's website, decides that it is an excellent analysis of the merger and, changing the names of the companies and some of the financial information and other facts, includes the memo as part of a case study for his business school class on high technology mergers. Assuming that Awesome is the owner of the copyright, discuss the defenses available to Professor Ernest.

QUESTION NO. 2 (30 Points)

You represent Rarebooks.com, which plans to become the eBay of rare book collectors. The Rarebooks.com website, available by subscription only, will have three major components - (1) an extensive database of rare book information compiled from various rare book compendiums; (2) an online computer program for valuing a rare book based on the system developed by James Libra, which was published by him in the bestseller, Rarebooks for Everyone; and (3) complete and up-to-date reports on the results of rare book auctions conducted by major auction houses.

Your client asks for your advice on the following issues:

Question 2(a): To develop its database, your client started with the 5'" edition of Avers Compendium, published in 1914, which contains relevant information about all rare books published before 1875. Ayers, the publisher, refused to license rights to the current 12'h edition which includes rare books published through 1975. The client has brought its database up to the 12`h edition standard by collecting information from other industry sources. Information on post-1875 books was added to the database only if that information was found in at least one other source besides Ayers' 12'h edition. However, the resulting database is almost identical to the current Ayers edition. Ayers has threatened to sue Rarebooks.com for copyright infringement. Discuss your client's potential liability.

Question 2(b): Libra's approach, which includes a rating system for what Libra determined were the five most important elements of book quality, is now widely used in determining the value of a rare book. The computer program being developed by Rarebooks.com will permit uses to "score" the quality of their books using the Libra rating system for the same five elements of the book. Libra has granted Ayers the rights to develop a computer program based on his book, and Ayers has threatened to sue Rarebooks.com for copyright infringement. Advise Rarebooks.com on its potential liablity.

Question 2(c): Bookauctions, Inc. compiles the results of major rare book auctions and publishes a monthly report on the results of those auctions, which it distributes to subscribers. It refuses to license its data to third parties. The subscription agreement contains the statement "Copies of the report are provided to the subscriber for subscriber's personal use only. Not for resale or further distribution." Rarebooks.com has subscribed to Bookauctions, Inc.'s report for the last ten years, and is extracting the data from the reports and incorporating that data into the Rarebooks.com database. Bookauctions, Inc. threatens to sue for copyright infringement. Advise Rarebooks.com on its potential liability.

QUESTION NO. 3 (30 points)

You are clerking for a District Court judge. Because of your familiarity with copyright law, the judge has asked you to prepare a short memorandum on the applicable law in connection with a pending motion for summary judgment brought by the defendant in a copyright case, Flags R' Us. Inc. v. World Banners.

The facts agreed by the parties are as follows:

In 1997, the plaintiff, FRU, acquired the copyright in the Earth Flag, which consists of two identical circular photographs of Earth taken from space, sewn onto each side of a dark blue synthetic fabric. A strip of white fabric is sewn onto one of the shorter ends of the flag, and a grommet is attached to each of the white strip's corners, thus permitting the flag to be flown horizontally or vertically as a banner. The original author of the flag registered the copyright in 1969. A supplemental registration stated "coverage is of the flag or banner, regardless of size, representing the image of Earth as taken from outer space by the Apollo mission, reproduced --d on a dark blue or black background, and the replication or reproduction thereof in any way, on any media or material." All photographs were taken by NASA and are in the public domain. The plaintiff's flag has become a well known symbol of Earth Day, and sells for $500 each.

Defendant has begun selling a $35 flag, made of cheaper materials, bearing a different public domain photograph of Earth on a light blue background, also with a white strip and grommets to permit use as a flag or banner. Defendant has moved for summary judgment contending that plaintiff's work is not copyrightable, relying on L. Batlin & Son, Inc. v. Snyder, 536 F.2d 486 (2d Cit. 1976). Defendant also contends that there is no similarity in protected expression because defendant's Earth photograph and the color of the background are both different from plaintiff's.

Write a short memorandum to the judge summarizing the applicable law and providing a recommendation on the disposition of the motion.

QUESTION NO. 4 (10 Points) You represent Magna Movies, a major movie studio. Magna is negotiating with Tom Thirdparty for the movie rights to "The Exterminator", a short story written, published and copyrighted by Arthur Author in 1975. Arthur died in 1985, and the copyright passed under his will to Wilma, his widow. Wilma assigned the copyright and "all rights" to Tom Thirdparty in 1992. Wilma died in 1993, survived by three children. What rights can Magna acquire from Tom Thirdparty? What are the renewal rights and termination rights? Who can exercise them and when? What steps would you advise Magna to take to protect its rights?