Ent Law Skinny – Fall 2011
1st Amendment Concerns with Ent Law (looking at things like sex and violence in entertainment)
Framework of 1st Amendment Analysis
o Is it first amendment protected/unprotected speech?
o To what extent is the speech regulated if it is protected?

Determine appropriate test, 2 ways to analyze
o Policy considerations
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If congress has these powers how do they exercise these powers
Burstyn Inc. v. Wilson= Movies are protected by the 1st Amendment; Like books and papers, the fact that sold for profit does not prevent protection under the 1st A
2 Ways of Analyzing 1st Amendment Issues
Balancing Approach
o
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Balancing of issues: ex: defamation
Categorical approach
o
o
Create categories and if fall into the category, automatically protected or not
Very narrow standard
 Ex: incitement; obscenity; indecency, child porn
Obscenity= Unprotected category; Miller Test (3 elements to determine if it is obscene)
The average person, applying contemporary community standards, would find that the work, taken as a whole, appeals to the prurient interest
Measured by contemporary community standards, the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law
The work, taken as a whole, lacks serious literary, artistic, political, or scientific value
Skywalker Records
Prior restraint with regards to entertainment and media – generally cannot use prior restraint, except for in certain circumstances (can take action after the fact, just can’t
prevent it)
Prior restraint allowed in
o
o
o
Troop movements (can’t disclose military strategy before particular action is taken)
Matters of national security of imminent nature
Rights of criminal defendant in certain situations (6th amendment rights)
Ashcroft v. Free Speech Coalition
Overbreadth doctrine
o
o
Can’t suppress legal speech as a by product of suppressing unlawful speech
Can serve as basis for striking down a well intended law that is written too broad
“Protected speech does not become unprotected merely because it resembles the latter”
FCC v. Pacifica
Indecent material can be regulated in certain forms of media (tv and radio) despite not being obscene (due to the unique pervasiveness of radio and tv)
FCC can regulate indecent speech because the government can make requirements for things they give licenses for
Cable tv and satellite radio and tv do not apply to the indecent regulation but do have to watch out for obscenity
o In making this type of distinction of what can be regulated, the court looks at scarcity, like how many other options are out there
Stern- Indecent: language of materials that depicts or describes, in terms patently offensive as measured by contemp community stds for the broadcast med, sexual or excretory activities or organs
Herceg v. Hustler Magazine= The concurrence focuses on how allowing tort liability would be ok because it would protect against loss of life which is a legitimate state interest while
the chilling effect would be outweighed by this interest, especially since tort liability is after the fact under special circumstances
Incitement
Brandenburg v. Ohio standard: to protect against the potential for expression to lead to violence, states may regulate only speech “directed to inciting or producing imminent
lawless action and is likely to incite or produce such action”
example of broad cast resulting in incitement: Weirum case where radio contest where tell people to get there first to win and someone gets killed
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o Ct said station created a foreseeable and unreasonable risk that someone else would endanger a third party
Book hitman describing how to become a hitman is an example of a written publication that could be considered incitement
Miramax v. MPAA- Ct dismissed because it is a private rating system
However, ct noted that there was not a rational basis for the rating, it was subjective and a marketing tool essentially
Defamation
Common Law (old way- not good law any more) did not require a showing of fault, and was essentially a strict liability issue
NY Times V. Sullivan
Created a new standard for public officials
Have to show actual malice by the defendant in making the statement (statement made with knowledge that it was false or reckless disregard of whether it was false or not
Curtis Publishing – extended the actual malice standard to public figures
Types of Public Figures
General all purpose
o
o
o
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Gertz – “clear evidence of general fame or notoriety in the community, and pervasive involvement in the affairs of society
Has to have access to media
Household names such as bono, cher, etc.
Limited
o
o
o
Person who has become famous for some evetn and have to prove actual malice as to coverage of that event
Considered a public figure with regard to a particular set of circumstances; either voluntarily inject themselves or are drawn into public controversy; public figure for a limited range of
issues
Once a person becomes a public figure in connection with a particular controversy they remain a public figure afterward for purposes of commentary on that controversy (Street v.
National Broadcasting)
Private Figure:
Use a negligence standard
Involuntary public figure
-
Person who did not want attention
Actual malice standard also
Private Person, Public Concern
Gertz case applied, uses a balancing standard
Min standard of fault is negligence (lower standard where basically only have to show where reporter didn’t follow up a lead or something) for actual damages
But if want to recover presumed or punitive damages, have to show actual malice
Summary of Defamation
Group
Standard used
Public Officials; Public
Figures
Private Person, Public
Concern
Fault – have to prove
New York v. Sullivan
Actual Malice
Gertz
Negligence for actual
damages
Falsity
Presumed/punitive
damages what need to
prove
Actual Malice
Higher standard of
actual malice for other
damages
Davis v. Constantin Cossta Gravis= Actual malice standard essentially allows you to rely on the work of others if they are a reliable source
Milovich v. Lorain Jour= Statement labeled as opinion not automatically protected under 1 A bc could easily convey an implied false factual assertion to the reader or listener
Intentional Infliction of Emotional Distress= Hustler v. Falwell: can’t use IIED to avoid 1st A limitations on defamation, still have to prove actual malice standard
4 Privacy Tort Causes of Action
2
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Intrusion
o Elements (Shulman v. Group W. Productions)
 Invasion of zone of privacy (reasonable expectation of privacy in the place, conversation, or data source)
 Must be offensive to ordinary person
o Look at things like whether enhancing device used
Private Facts
o
o
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Public disclosure of embarrassing facts
Elements: (Ross V. Midwesst Communications Inc.)

Publicity given to matters concerning private life (name may be changed, but the if the person involved and his or her family/friends know its him or her being portrayed still
applies)
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Publication must be highly offensive to reasonable person of ordinary sensibilities
 Matters publicized is not of legitimate concern (only has to be “reasonably intriguing to a concerned public) (what is the value of publishing the fact?)
False Light
o Elements or standard (Cantrell case)
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

o
o
Defendant implied something that was factually false and it was publicized in a widespread manner
The info places the plaintiff in a false light
The info must be highly offensive to a reasonable person of ordinary sensibilities
Fault – court added in Cantrell case due to close connection to defamation – actual malice standard

Invasion of Privacy
Basically when untrue facts have been published about person placing them in a false light in the public eye

Differs from defamation because defamation focuses on the injury to reputation, while false light focuses on the psychological charm to the plaintiff
o
-
Takes into account the type of public figured being applied and access to media concerns involved in that analysis
 Public figures: subject matter does not necessarily become private with the passage of time (dresbach v doubleday)
 Once a person becomes a public figure in connection with a particular controversy, they remain a public figure afterwards for purposes of commentary on that
controversy (Street v. National Broadcasting)
Right of Publicity
o
A celebrity’s right to the exclusive use of his or her name and likeness
 Elements (MLK, v. American Haritage
Appropriation of another’s name and likeness
Without consent
For financial gain of appropriator or injury to plaintiff
Appropriation of name and likeness issues, basically deals with name or likeness being appropriated without consent
Differs from right of privacy because it focuses on the commercial or property element and the right to be compensated from an economic point of view and one’s proprietary interest in
their name and likeness
Rights with regards to entertainment shows

 Can’t show entire production, but not sure on where to draw line for the limitation (Zachini v. Scripps Howard)
Factors to consider with this type of case: what is defendant using image for; is it commercial; is it for news?
o
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

o
o
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

o
Life story can’t misappropriated (Matthews v. Wozencraft) (look up 3 elements discussed in case)
Can it survive death
Personal distress claim – no cannot survive death
Commercial aspect – yes, can survive death
Rights with regards to celebrities
 Potential policy concern is when the use would not cause confusion under trademark law why extend protection under publicity law (Carson v. Here’s Johnny
Toilets)
 Not important how identity was appropriated, just how appropriated – so even if don’t physically appear in ad can still misappropriate identity (Vanna White
v. Samsung)
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Copyright Protection
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-
Derived from intellectual property clause of constitution (art I section 8 clause 8)
Designed to create incentive for creative efforts by establishing a reward for the effort (allows them to recoup any money spent in producing original)
Two problems
o Someone can come along and adapt it with less effort and still be rewarded without original person being awarded
o creates some tension with 1st Amendment Free Expression and Speech concerns
last for term of life of creator + 50 years
Copyrightable Material
-
original works of authorship fixed in any tangible medium of expression
o can’t be done by someone else
o authorship – some creative aspect; independent creation of new product
o must be fixed in a tangible medium of expression


moment put in tangible form its protected by copyright and does not require formal procedure
if it is something like a dance routine, videotape it
doesn’t have to be published

ideas, theories, facts are not copyrightable
o expression of facts is copyrightable
fact gathering (sweat of the brow) is not protectable (fiest case)
Copyright protection focuses on the expression of the ideas, not necessarily the idea itself so someone can come in and change it
Expression is protected but not facts
-
Expression
o
o
o
o
Facts
Characters
Plot
Dialogue-if dialogue in 2 works in substantially similar wwe could
have copyrightable issue
TC &F
o
Ideas/theories
o
“sweat of the brow”-effort in gathering the information
p.317 , Feist Publications v. Rural Telephone Service
*pt’ed to note 1
scenes a faire – stock scenes
stock characters
Infringement of Copyright
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Copying of expression from an original work
Independent creation is a defense, so if independently created, even if it is substantially similar there is no copyright infringement
elements to consider
o Whether person has access to copyrighted work
o Whether there is a substantial similarity between the copyrighted work and the work at dispute
If one is very convincing the level required for the other aspect is lowered
With regards to music, even though musical notes in public domain, a particular sequence of them is not (Bright Tunes v. Harrison)
With regards to books, look at the delivery of the theme, tones, ect even if telling same factual story or similar, all about how they deliver it (Denker)
-
Unprotectable parts of a story
o Scenes-a-faire: scenes that are essentially automatically part of the story as a result of the choice of setting or situation
o Characters: stock characters are not protected
Fair Use is a defense
Fair Use Defense (section 107) (sony first case to use)
Balances right of copyright owners against interest of public in gaining access to copyrighted works
Factors
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o
o
o
o
o
o
o
o


Purpose
Character and substance of the use
 Is it in bad faith?
Commercial or not
 Looking at things like whether done for profit
Nature
 Is the work factual based or created
Published

Is the original copyrighted work published or not
Amount Taken
 A quantitative analysis of the amount of the work taken (like only a paragraph out of an entire book)
Substantially
 Qualitative analysis of the amount taken (looking at how big the amount taken was to the over all work, was it the heart of the work or just filler for example)
Effect
 Effect on potential market
Can defendant’s work replace the original
Is there any other harm (like plaintiff losing money)
Just because work is commercial does not make it automatically unfair ( Orbison v. 2Live Crew case)
Must consider parody purpose of new artist in purpose factor and in the qualitative factors, parodies generally receive favorable treatment (Orbison v. 2LiveCrew case)
Advances in file sharing technology have become a huge concern in copyright law
-
Napster Case – file sharing does not fall under fair use defense
Grokster case – did not apply fair use analysis from Sony because this technology created for the purpose of copying, unlike Sony where not marketed copy video – focus on what the machine is
marketed to do
Performance Rights in Songs
Musicians have copyright rights in their musical works in 2 ways
o Songwriter has copyright rights: person gets all the royalties from the licenses obtained through licensing companies
o Sound recording: the actual recording of the song in that form (the entire band, but these people don’t get royalties from public performances)
Musicians also have public performance rights in their work, or essentially revenue from public performances of their work
Public performance is defined by these elements
o Performance in a place open to public
o Any place where substantial number of persons outside normal circle of family present
o The works is transmitted
 Essentially broadcasting of the work
Section 110(5) small business exemption
o To meet this exception


Can’t charge admission
Has to be recorded music coming from a radio or tv transmission (cd’s and cd players do not apply)
Can’t use a commercial sound system or run music from the radio out to somewhere else

Ownership of Copyright Right
Person who created the work is the owner
o Work for hire is an exception (section 101):
 If an employee that is paid to create works, then it is the property of the employer (look at common law agency rules)
 If just an independent contractor, the contractor has the rights unless there is a special agreement to sign the rights over
Can sign over the rights
Can sell licenses to the work
o Exclusive agreements need to be in writing
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o Make sure obtain all the rights that are needed in the writing
Enforcing Copyright Rights
o Can receive injunctive relief or damages
o To prove damages look at
 Loss to plaintiff
 Profits of defendant
o Also have statutory damages
 A flat amount set by statute per work, if do not want to have the burden of proving damages at trial which can be costly and difficult
Alternative Sources of Entertaintment Property Rights
3 Main forms of Protecting Property Rights in Entertainment besides copyright
Contract Law
Labor Law (lagor agreements)
o Big in movie industry
o Collective bargaining agreements
Trademark law
Artistic Credit
Lanham Act § 43(a) (part of trademark law)
 (1) Any person who, on or in connection with any goods or services…used in commerce any word, term, name, symbol, or device…or any false designation of origin,
false or misleading description of fact, or false or misleading representation of fact, which o (A) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to
the origin, sponsorship or approval of his or her goods, services, or commercial activities by another person, shall be liable in a civil action by any person who
believes that he or she is or is likely to be damaged by such act.
o Protects against “palming off” or “passing off” (Lamonthe)
 Selling of a good or service of one person’s creation under the name or maker of another (example is selling a generic and trying to pass off as brand name)
o Also protects against reverse palming off – leaving someone’s name off that was a part in the creation
o Also protects the work in a situation Where the creator does not want name on work after it has been substantially altered because of the negative implication (Gilliam
v. ABC)
 Can edit, but have to determine whether over edited under circumstances
Trademark Law
Applied using 8 factor Polaroid test in determining whether infringed upon
o
o
o
o
o
o
o
Strength of the mark
Degree of similarity between the marks
Proximity of the products
Bridging the gap
Actual confusion
Bad faith
Quality of products
Consumer sophistication
o
Essentially looking at the likelihood of confusion to see if misleading the consumer in any way
Contract Rights in Story Ideas
Contracts might protect ideas when copyright does not
In situation where have one person who wrote a screen treatment that was later adapted by another screen writer and made into a movie, the court can look at the contract then
focus on things like how similar the new screen play was to determine if there was a breach of K, but the level of similarity allowed depends on the K language (Buchwald)
o
Does not matter that story is not all new, its based on the K’al arrangement
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o
Can also use K to get around paying him depending on whether paying him part of net profit or net revenue
K that focuses on net profit: they can put lots of the overhead into the accounting of the movie making a high grossing movie have no net profit
Contract Formality
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Can use promissory estoppel to enforce liability for breach of an oral K (Elvin Associates v. Franklin)
Actor that backs out of movie can be sued for damages successfully, even when there was no written K signed by the Actor – can be liable for losses suffered by the project falling apart or having
to replace with a lesser name (Basinger Case)
Even if there were several things not spelled out in the oral agreement (including big things like starting date budget, etc) if there are enough terms present it is binding because parties can
negotiate other terms going forward or can use prior dealings to fill in the gaps (Gold Seal)
o Also, emails are considered writings under the Federal E-Sign law
Right of first refusal – allows publisher, studio, etc to get the ability to match the competing offer of someone else or trump it (that way studio gets to protect its K, and the creator gets best deal
because will get that amount no matter what)
The ability of minors to void a K is supposed to be a shield instead of a sword, only used when the minor in a worse position after the K (Scott Eden)
o Can’t disaffirm necessities K because getting a benefit, so is same in show business where making a lot of money
o There are special protections for minors in entertainment – Jackie Coogan law

Jackie Coogan law: requires judicial approval of the K and the child performer’s pay, set aside money of K in a trust for the child until becomes an adult, and the studios are
protected because the K is binding now and minor cant walk away
Bankruptcy: if a K is negated through bankruptcy, the person can sign another deal for more with another company as long as met technical rules of bankruptcy due to the fresh start concept
bankruptcy is founded upon (can use to take advantage of system in getting out fo K)
o Record companies need to break payments into installments to protect themselves from this type of situation by not giving up so much up front
Standard Considerations in Contracts in Ent. Industry
Creative control: harder to determine breach here (most artists want it)(can lead to things like disputes between actor and director as far as direction of a work)
Morals Clause: common in Movie industry to prevent major participant from going out and getting convicted of a crime that could affect the earnings potential
Non compete Clause:
o Either exclusivity or non compete, especially common in publishing (don’t want your author writing a book for a competing author in same genre)
o As long as they are ancillary to overall agreement and reasonable in terms and scope they are upheld by the Courts
Satisfactory product: ““The author will deliver to the publisher, on or before (date), one copy of the manuscript of the work as finally revised by the author and satisfactory to the
publisher in form and content.”
o big dispute of what works in publishing industry (like deligvery of a manuscript that Is not good, does this create obligation to assist the author in revising the work to
make it satisfactory? Some courts say yes)
Best Promotional Efforts: publisher must act in good faith to take reasonable efforts to promote client
o often a question of what is “best efforts” but usually a reasonable effort on publisher’s part works and there is a lot of business judgment deference here because in
best interest to promote it, but there are industry standards to go by
Compensation provision: keyed to net profit notion
o Getting a percentage of gross revenue is usually best course of action because prevents the creative accounting from being used to say the project lost money and there
was no profit – can take less salary and get higher percentage of gross revenue and can really hit it big if the project explodes in popularity
o However, gross rev can be under reported and if the studio owns tv networks or other distribution net works, then it cuts into revenue because not getting money for
those performances
List of Overhead Deductions: what is taken out of profit
o
Big problem for musical artists because various deductions that have to be met before musical artists get any money besides up front advance (production costs, royalties,
o packaging costs, promotional costs, breakage, reserves for returned goods, managers and agents percentages)
Representation of Entertainers
Talent Agent: secure employment for the artist (typically gets 10% of any revenue from jobs he secures)
Personal Manager: helps with the day to day business, and typically serves as the first type of agent an artist secures – blurring of the lines between an agent and personal manager
Business Manager: handle the financial investment side of dealing with artists money (typically only most successful have this)
Lawyer: entertainment lawyer brought in during transactions to ensure artist secures best deal possible,
State Regulation for Agents
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New York: “any person who procures or attempts to procure employment or engagement” but does not include the business side of managing the entertainment
o 10% ceiling on the commission
California
o
o
o
o
Have to have license to procure or attempt to procure employment (personal managers and agents also have to)

Record label agreements do not apply
Have to get approval of standard Contract before using it
No cap on commission, but too excessive like over 20% would be unconscionable
Look at the conduct to determine if they are an agent

If large portion of their work is procuring employment, subject to obtaining a license, even if that was just an incidental aspect of their duties
Conflict of Interest
Have to meet 2 requirements to represent in a potential conflict of interest situation
o
o
Have to have the ability to adequately represent both clients
Each client must give consent
Also have a fid duty to the client when deal with a person who, while may not be truly the client, has or should have reason to believe or rely on the lawyer
Unions
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Unions are immune from prosecution under anti-trust statutes for monopoly like behavior since they are looking out for the self interest of the members
The exemption does not apply when labor group combines with non labor group
They provide health and economic benefits to members, further the economic and other interest of members
Work with studios to resolve credit and recognition issues for the artists
Work to set minimum floor for compensation for members
Work to establish minimum working conditions and benefits for members
Loan Out Company= A legal mechanism where actors create a company for tax benefits that offers out the artists services so the income is not personal income
Antitrust Law
Antitrust Law
Sec 1 of Sherman Antitrust Act
First of two major antitrust provisions relevant to ent industry
o Governs situations where there are agreements
 3 types (governed by sec 1)
 Contracts
o Tying arrangements: forces you to buy a second product to get the product you originally wanted. Making the buyer follow a contract to
buy extra stuff
 Need 4 elements





Two products
Tied together
Market power
Substantial amount of commerce involved
Combinations (merger between two or more firms)
o 3 types of merger situations that can be encountered
 Horizontal
 2 firms doing same thing in same market combine (like two tv networks merging)
 Vertical
 Not competitors, but in same chain distribution of same product
 Conglomerate
 Situation where have a firm in one market acquiring a firm in a totally unrelated market
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

Conspiracies
o in restraint of trade or commerce (anticompetitive)
o Price fixing
 Horizontal
 Between competitors in market
 Per se violation
 Vertical –
 Chain of distribution
 Traditionally considered per se unlawful, but in recent years sup ct has applied new approach : rule of reason
What is common to all three is that there is some form of agreement between 2 or more independent parties
Sec 2 of Sherman Act
-
3 types of conduct condemned under this
o
o
o
-
Monopolization
Attempted monopolization
Conspiracy to monopolize
Elements Analyzed in Determining whether there is a violation
o Market power:
 Power to affect price in market






o
Conduct: must be some anticompetitive or exclusionary or predatory conduct


o
Need large market share
In order to prove case have to have monopoly power (ability to control price in market)
Market share of 85% is enough
Significant share and ability to sue barriers to keep competition
Specific to attempted cases to show power element: “dangerous probability of success” –
Specific to conspiracy: very similar to section one conspiracies because has to involve 2 or more firms
Some impermissible behavior as part of monopoly or attempt to
If company achieves position through superior skill, foresight and industry (having a good product and doing a better job than all competitors) conduct is a defense because it is
not bad or unlawful conduct
Intent: has to be an intent
 General intent to monopolize market or carry out behavior
 Attempt: courts require specific intent (to achieve monopoly power in future, which is a little higher level of proof)
The FTC and Department of Justice enforces these rules
Music Industry Antitrust Concerns
BMI and ASCAP, serve as intermediaries to song writers and places that want to play their music setting prices for licenses negotiate licenses for entire group instead of individually, and
purchaser gets a blanket license to play all the songs
Movie Industry and Antitrust concerns
Regulation under antitrust law is not a violation of the first amendment rights because can protect those but still no illegally restrain trade, only deals with the restraint of trade
Vertical Price fixing
o Look at from rule of reason standpoint
Horizontal price fixing between studios
o Per se
Block booking
o Is there a justification for showing all five movies as a group

Like trying to share the risk, lets the theatres share the loss if sharing the revenue

Now different if already know if the movies are a hit or loser
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