Intellectual Property

In Buergofol GmbH v. Omega Liner Company, Inc., 4-22-cv-04112 (DSD Jul. 13, 2023) (Karen E. Schreier), the court granted the defendant’s motion to compel and awarded monetary sanctions after the plaintiff failed to respond at all to discovery requests that the plaintiff had objected to as overbroad because the court ruled the plaintiff “still had an obligation to respond to the extent it did not object.”

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The Supreme Court decision in Andy Warhol Foundation v. Goldsmith changed the way fair use is analyzed. In determining fair use, four factors are examined. The first fair use factor examines the purpose and character of the use. Prior to this case, the focus has been on the transformative nature of the work itself. The Supreme Court in Campbell v. Acuff-Rose Music established this transformative use analysis when it said that the first fair use factor is an inquiry into whether “the new work merely “supersedes the objects” of the original creation, or instead adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message[,]. . . in other words, whether and to what extent the new work is transformative.” This transformative use analysis took on great importance and often eclipsed the other fair use factors. Prior to this case, the focus was on whether the second work had a different aesthetic or conveyed a different meaning. If the work was transformative, it was almost always found to be fair use. 

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In response to Google L.L.C.’s (“Google”) and other’s petitions for inter partes review (“I.P.R.”) of two patents owned by Parus Holdings, Inc. (“Parus”), the Patent Trial and Appeal Board (“PTAB”) of the United States Patent and Trademark Office (“USPTO”) found a number of claims obvious over prior art. The Court of Appeals for the Federal Circuit affirmed the PTAB’s decision, shedding additional light on the requirements and burdens of patent owners when responding to I.P.R. petitions.

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On June 7, 2023, the Ninth Circuit issued its opinion in VHT, Inc. v. Zillow Group, Inc., in which it affirmed the trial court’s findings of infringement against Zillow and the award of statutory damages. In 2019, the Ninth Circuit had previously found mostly in Zillow’s favor as to an earlier trial and had reversed and remanded the case back for further proceedings.

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The Federal Circuit Court of Appeals continues to strike down patents directed to abstract ideas under the Alice test for patent subject matter eligibility. In People.ai, Inc. v. Clari Inc. (Fed. Cir. 2023) U.S. App. LEXIS 8294, the court invalidated seven patents owned by People.ai.

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In a closely watched copyright case, the U.S. Supreme Court ruled Thursday that Andy Warhol’s portraits of music legend Prince did not qualify as fair use under copyright law. The decision affirms a previous ruling by the Second Circuit, which found that Warhol’s artwork shared the same commercial purpose as the original photograph taken by photographer Lynn Goldsmith.

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Earlier this month, a new Drake and Weeknd collaboration disrupted the Internet. The only problem was it wasn’t a Drake and Weeknd collaboration after all. The song “Heart on My Sleeve” was written and produced by TikTok user ghostwriter977. The vocals for “Heart on My Sleeve” were generated by artificial intelligence and made to sound like Drake and The Weeknd. UMG, the record label behind the artists, is furious and is pushing music streamers to block AI tools from training on its artists’ melodies and lyrics. While “Heart on My Sleeve” was ultimately removed from Spotify due to a copyright issue…the song had an unauthorized sample in it…we could see more original AI fake Drake songs from ghostwriter977, and there may not be anything UMG or the artist can do about it. 

The music industry sees generative AI tools that can create music that sounds like a specific artist as a real threat to business. In response to the fake Drake AI song, UMG issued a statement publicly encouraging digital service providers not to let generative AI tools train on music issued by their artists. UMG considers this a violation of copyright law.

The issue of whether training an AI tool on existing copyright-protected works constitutes infringement or is fair use is currently being litigated in a number of cases. Whether the initial content-copying an AI tool does as part of its learning process constitutes infringement or protectable fair use will have a profound effect on the future of AI. The courts’ focus will be on whether this copying is part of an overall transformative process to be weighed against the commercial impact the tool has on the applicable industry.

Focusing on the output, most, if not all, of those cases deal with generative AI platforms that create visual works. In this instance, it’s the creation of a musical work where the song itself was original, written by ghostwriter977. And since UMG based its takedown on a small sample audio tag included in the song, it seems fair to assume that the original components of the song itself probably are not infringing.

“Heart on My Sleeve” wasn’t the last of the Fake Drake. Another Fake Drake AI track recently dropped. The track “Winter’s Cold” was posted to Soundcloud on April 18, featuring the artificial vocals of Drake. The track garnered over 120,000 listeners on the platform. This, I am sure, has the record industry and recording artists strategizing on how to put this all back in the bottle. 

The first reaction is that this has to be a violation of the artist’s right of publicity claim. California’s right of publicity statute is Civil Code Section 3344, and it prohibits the use of another’s name, voice, photograph, or likeness on or in products, merchandise, or goods, or for purposes of advertising or selling such products, merchandise, or goods without such person’s prior consent. California also has a common law right of publicity that’s a bit broader than the statute. 

The Ninth Circuit has adjudicated two well-known right of publicity cases involving soundalike recordings. The first was Midler v. Ford, and the second was Tom Waits v. Frito Lay. Both cases involved the use of a soundalike singer singing a song in the style of the artist in a TV commercial. Both sued for violation of her right of publicity under the civil code and under common law. The trial court in Midler initially granted Ford its motion for summary judgment. On appeal, the 9th Circuit, addressing Midler’s common law claim, held that when a distinctive voice of a professional singer is widely known and is deliberately imitated in order to sell a product, the sellers have appropriated what is not theirs and have committed a tort in California. The Waits court, which relied on Midler, found similarly.

The holdings from both Midler and Waits will not be of much use to either UMG or Drake. Civil Code Section 3344 prohibits the use of another person’s “name, voice, signature, photograph or likeness, in any manner on or in products, merchandise, or goods, or for purposes of advertising or selling…..such products, merchandise, or goods without such person’s prior consent.” The Fake Drake AI songs were not being used to sell products. And as for a common law claim, even though common law provides a broader right of publicity protection than the statute, the First Amendment may prevent any recovery. Generally, a claim for common law appropriation will not stand under expressive works due to the First Amendment.

The biggest hurdle UMG or any recording artist who wants to sue based on an original generative AI sound recording with “soundalike” vocals will face is Section 114(b) of the Copyright Act. Section 114(b) permits “soundalikes.” A publication by the US Copyright Office specifically says that “under U.S. copyright law, the exclusive rights in sound recordings do not extend to making independently recorded “soundalike” recordings. Copyright protection for sound recordings extends only to the particular sounds of which the recording consists and will not prevent a separate recording of another performance in which those sounds are imitated. The imitation of a recorded performance, no matter how similar to the original the imitation may sound, would not constitute a copyright infringement, even where one performer deliberately sets out to simulate another’s performance as exactly as possible. So, subject to the open question about whether the AI training process constitutes infringement, as long as the music and lyrics are completely original and the sound recording does not contain any uncleared samples, then a generative AI sound recording that has “soundalike” vocals is probably completely legal.

This is not to say that UMG or other record companies don’t have other ways to combat this. The creator of an AI-generated “soundalike” song certainly can’t hold the song out as being from the actual artist. Also, I am certain that these record companies are examining and amending their contracts with any online service that distributes and performs music and insisting that these services prohibit generative AI tools from accessing the services.

In 2018, United Cannabis Corporation (“UCANN”) sued Pure Hemp Collective (“Pure Hemp”) for infringement of U.S. Patent No. 9,730,911 (the “‘911 patent”), entitled “Cannabis Extracts and Methods of Preparing and Using the Same. The ‘911 patent relates to “extraction of pharmaceutically active components … more particularly … botanical drug substance (B.D.S.) comprising cannabinoids obtained by extraction from cannabis.”

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On April 24, 2023, the Ninth Circuit issued its opinion in Epic Games, Inc. v. Apple, Inc., and affirmed the trial court’s ruling in Apple’s favor as to Epic’s Sherman Act claim for restraint of trade relating to Apple’s distribution of apps in its App Store. (This article does not address the other antitrust and state law claims also at issue in the 91-page opinion.)The legal battle involved “a multi-trillion dollar technology company” (Apple) versus “a multi-billion dollar video game company” (Epic).

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