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VOLUME TWENTY, NUMBER 2 -- 2000TABLE OF CONTENTSSYMPOSIUM: LEGAL AND BUSINESS ISSUES IN THE DIGITAL DISTRIBUTION OF MUSIC This Article addresses whether existing copyright law, including the Copyright Act and recent amendments such as the Digital Millennium Copyright Act and the World Intellectual Property Organization Treaties, is effective in enabling copyright holders to regain and retain control over the dissemination of their properties in a digital environment, or whether additional measures are required. This Article focuses on future releases, which are traceable through embedded watermarks and other identifying codes enabling those releases to be tracked and traced throughout the networked world. Part II of this Article outlines the exclusive rights granted under the Copyright Act. Part III then discusses recent international treaties and domestic laws that were implemented to cope with the enormous changes resulting from existing and emerging communications technologies. Part III also highlights some apparent weaknesses in the domestic laws. Part IV explains the distinction between digital distribution and digital delivery, and describes some of the internet business models that have arisen. Finally, Part V concludes that although the entertainment industry is experiencing growing pains and the enormous discomfort that arises where there is uncertainty in business, the legitimate digital distribution and delivery of music, video and film may prove to be the industry’s biggest revenue ticket ever, provided that content providers focus on long term goals and revenue building strategies that incorporate current consumer expectations. COPYRIGHT LICENSES, NEW TECHNOLOGY ANI) DEFAULT RULES: CONVERGING MEDIA, DIVERGING COURTS? Determining whether a copyright license embraces new technology has long concerned the courts, and the digital revolution has dramatically multiplied the issues. This Article analyzes the divergence between the judicial approaches to new use cases involving grants of rights for the creation and dissemination of derivative works and examines whether the courts have adopted or should adopt any default rules to decide close cases. The Article concludes that default rules have not been established and considers the basis for the contrary perception, including Nimmer’s assessment of the new use issue. After identifying the judicial divergence as primarily resulting from the courts’ differing views on the significance of copyright policy in the new use analysis, the Article considers the propriety of establishing a default rule favoring authors of underlying works, The Article examines the need to balance the rights of authors of underlying works and the rights of authors of derivative works, as well as the importance to the public of the creation and dissemination of derivative works, and concludes that such a default rule would be inappropriate. The Article further argues that a default rule of any kind is unnecessary and points out that the placement of the burden of proof essentially acts as a tie-breaker. The Article then moves beyond the question of default rules and considers whether copyright policy should play any role in interpreting the scope of copyright licenses. The Article concludes that copyright policy supports the development of a federal common law of contracts to interpret the scope of copyright grants, and that, at a minimum, state law rules of construction should be tested against that policy before those rules are employed. STREAMING INTO THE FUTURE: MUSIC AND VIDEO ONLINE The Internet is impacting the music industry in much the same way it has other retail industries. The Internet’s influence on the music industry is especially significant because it has the potential to change an industry controlled by a few record labels that have been able to consistently sustain high profit margins. However, digital distribution—the delivery of downloaded music from the Internet—is threatening to change this well-established system. This Article illuminates some of the battles and positions of traditional and Internet entertainment companies. The Article first provides a background of how the traditional music industry functions and then explains how music is currently being used on the Internet. Then, the Article explains how the United States’ copyright laws protect music, followed by a discussion of some of the recent cases involving music and the Internet. The Article concludes that although the traditional entertainment industry has much to contend with, they are working on moving forward to develop this tool and that the record labels and the online music community may not indefinitely remain at odds. When the Digital Performance Right in Sound Recordings Act of 1995 (“DPRSRA”) was passed, neither Congress nor any of the parties involved appreciated that the Internet would be the testing ground for many of the DPRSRA’s provisions. Yet it was the introduction and rapid growth of music services on the Internet that prompted Congress to amend the DPRSRA through the Digital Millennium Copyright Act in 1998. This Article discusses two brewing controversies regarding the scope of sound recording performance rights. The first issue is how to apply the revised definition of “interactive service” to personalized music services. The second issue is whether an exemption granted for certain Federal Communications Commission-licensed broadcasts applies to the Internet and beyond. Although both issues have arisen due to the use of recordings on the Internet, resolving these issues will undoubtedly have sweeping effects on the performance rights for recordings in all digital media. PANEL TRANSCRIPTIONS Loyola Law School, together with the Los Angeles County Bar Association Intellectual Property and Entertainment Law Section, organized a live symposium on “Legal and Business Issues in the Digital Distribution of Music” on April 17, 1999. Two of the panel discussions held on that day are reproduced here. LICENSING OF MUSIC AND RECORDS FOR DIGITAL USE Moderator - Ron Gertz,
President of Music Reports, Inc. Moderator - Jay Dougherty, Associate Professor of
Law, Loyola Law School of Los Angeles. NOTES & COMMENTS In June of 1999, the Los Angeles Dodgers became the first baseball team caught scouting in Cuba, a direct violation of Major League Baseball rules. As a result of this violation, the Los Angeles Dodgers lost their contractual rights to two Cuban-born minor league players and were fined $200,000. The Dodgers helped the players defect to the Dominican Republic, which, under Major League Rules, allowed the Cubans to sign as free agents with the Dodgers. However, the Dodgers were never charged with violating the Cuban embargo. This Comment argues that Major League Baseball rules must be changed in order to avoid giving teams an incentive to violate United States foreign policy. This Comment discusses the Dodgers’ unprecedented actions in Cuba, and examines the details of the first time, in direct contravention of Major League Rules, a Major League team scouted in Cuba. The Comment continues by focusing on the Cuban embargo, specifically the history of the embargo, its recent developments and whether the Dodgers could be charged with violating its implementing provisions. Additionally, this Comment examines the evolution of Major League Baseball rules regarding the recruiting and signing of Cuban players and how present day Major League Baseball rules encourage teams and agents to violate the Cuban embargo. Finally, this comment describes recent legislative and presidential action regarding the United States embargo against Cuba and how this could affect Major League Baseball and its rules. The comment concludes by suggesting changes to Major League Baseball rules in order to avoid another incident similar to that created by the Dodgers. SNEAKING THROUGH THE BACK DOOR WITH PEPPERIDGE FARM: THE MONOPOLY ADVANTAGE OF DILUTION Traditionally, trademark law has not granted trademark owners the exclusive rights over the design or shape of their marks. Commercial monopolies over shapes and designs are generally left to patent law. Yet, in Nabisco, Inc. v. PP Brands, Inc., the Second Circuit’s interpretation of the Federal Trademark Dilution Act of 1995 (“FTDA”) may alter these traditional notions. This Note argues that the Second Circuit improperly applied the FTDA, resulting in an improper grant of permanent and nationwide preliminary injunctive relief to an undeserving mark. This Note further argues that the Second Circuit in Nabisco has substantially furthered the transformation of dilution law, allowing trademark owners the unprecedented possibility of perpetual and exclusive rights over the shape of certain marks. This note concludes that courts need to clearly define and reasonably interpret the concept of dilution or there is little hope for uniformity and even less hope that the FTDA will fairly grant nationwide legal refuge to only the most famous of marks. SHOW HER THE MONEY: THE CALIFORNIA COURT OF APPEAL’S MISTAKE CONCERNING IN RE MARRIAGE OF BONDS In light of professional athletes’ skyrocketing
salaries, their likelihood for divorce, and their fear that potential
mates are marrying them for
their money, prenuptial agreements have become attractive options. These
contracts allow professional athletes to avoid the default rule in community
property jurisdictions that all marital property is divided equally upon
divorce by giving professional athletes the ability to define their future
earnings and assets as separate property. Barry Bonds, a professional
baseball player, entered into a prenuptial agreement with this in mind.
However,
the California Court of Appeal invalidated Barry’s prenuptial agreement
when he filed for divorce in In re Marriage of Bonds. The court invalidated
the parties choice-of-law clause, a particularly important contractual
instrument for professional athletes, for the wrong reasons, but the
larger error was the imposition of heightened scrutiny to determine voluntariness
whenever only one party has independent legal counsel. The appellate
court
usurped the powers of the legislature by creating a standard of review
contrary to the language of the law, its legislative history, and relevant
case law. Although the California Court of Appeal was in pursuit of an
admirable goal, it superseded the law in the process. As a result, this
Note argues that the California Supreme Court should overturn the decision
to use heightened scrutiny. |
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