Hope you enjoyed part 5 in our series on Idea Theft. Welcome to Part 6 on Copyright Infringement Precedents and Implied Contracts.
If in this series I have mentioned – on the World Wide Web for all people to see – an idea or concept and someone reads it and proceeds to develop it… well that’s fair game (unless if it was a concept/project that was clearly copyrighted and so on).
Moreover, there’s a fundamental difference between an idea or an unsolicited submission being sent to some unassuming media company executive or talent agent who didn’t ask for the pitch, and when an idea or project is discussed in bilateral meetings.
What we’re exploring are private and bilateral conversations between two parties to explore a collaboration, where then one party violates the “implied contract” between them.
Can you handle the truth?
In a trial, copying involves the factual issue of whether the defendant actually used the plaintiff’s work in order to create the work. Lacking direct evidence, copying can be proved by circumstantial evidence establishing
(1) access to the plaintiff’s work and
(2) similarities between the works.
The best military commanders (i.e. quarterbacks, and so on) read the defence and devise their action plans accordingly. Lawyers tend to say little, but what they omit reveals the weakness in their client’s position.
For brevity, I will expand on at seven (7) cases, below, of which six were based in California and another in Quebec, Canada, which is where my company is headquartered.
A) California case law
1) In Buchwald vs. Paramount (1990)
Humorist and writer Art Buchwald alleged that Paramount Pictures stole his script idea and turned it into the 1988 movie “Coming to America.” Mr. Buchwald won the lawsuit and was awarded damages, and then accepted a settlement from Paramount before any appeal took place. The decision was important mainly for the court's determination in the damages phase of the trial that Paramount used ‘unconscionable’ means of determining how much to pay authors, which is widely called ‘Hollywood Accounting.’ Paramount claimed, and provided accounting evidence to support the claim, that despite the movie's $288 million in revenues, it had earned no net profit, according to the definition of ‘net profit’ in Buchwald's contract, and hence Buchwald was owed nothing.”
This is noteworthy as:
i) that was “only” an idea to begin with;
ii) estimating damages once the matter is “ripe,” i.e. say Netflix pays Paramount $1M per episode and it’s industry standard to get (for example) 1% as executive producer, then one can rely on expert testimony to determine damages should be 1% of $1M per episode = $10K per episode, and so on.
2) The 2004 Ninth Circuit Decision
“A 2004 decision by the Ninth Circuit Court of Appeals held that when a writer pitches an idea to a production company, an ‘implied in-fact contract’ is created, meaning the writer has a reasonable expectation that he will be paid if the company turns his idea into a product.”
This is noteworthy and pertinent as it touches on the concept known as “implied contract.” In essence, this means that if a writer pitches an idea or submits a script to a studio or network and that idea or script gets used, the writer must be compensated.
A long, protracted case with an anti-climactic outcome:
“Aaron and Matthew Benay filed a lawsuit accusing Warner Brothers and others of stealing the idea for ‘The Last Samurai’ from their screenplay of the same name, which they claimed was submitted in 2000 by their agent to the production company run by producers Marshall Herskovitz and Ed Zwick, and was later used as a basis for the 2003 film.
The movie came out in 2003, the lawsuit was filed subsequently and by 2012:
“In the course of discovery, an anonymous source produced documents incriminating Warner Bros.“
In February 2012, Judge Philip Gutierrez determined that the plaintiffs have not established sufficient “privity” to show that the studio shared knowledge of the writers’ screenplay.
Then in April 2012, after a seven-day trial in U.S. District Court in Los Angeles, a jury ruled that the script never was submitted in the first place. All other issues in the case, including whether an “implied contract” existed between Bedford Falls and the Benay brothers, were thus rendered moot, giving Herskovitz and Zwick a victory. Again, part of the challenge is in establishing the party that allegedly stole the idea had no knowledge of the original concept, which is the main reason the Benay’s did not prevail.
4) Eckler v Apatow re: Knocked Up Settlement
Proving access is one part of the challenge. In one matter, a Canadian author named Rebecca Eckler had written her 2004 book “Knocked Up” which was the name of a movie by Judd Apatow:
“Ms. Eckler was alleging that the story for the hit movie "Knocked Up" was taken directly from her book of the same name. She claims that she shopped around her 2004 book to be made into a movie. In the middle of the process, she learned of the Apatow project. The script that was making the rounds, she alleges, had a picture of a martini glass with a pacifier around the stem -- the same as on the cover of her book. Eckler, who told her tale in this month's Maclean's magazine, cites other similarities -- including the fact that the Katherine Heigl character is an up-and-coming television reporter, and the main character in Eckler's book is an up-and-coming newspaper reporter. She also says that the movie and book have a secondary female character in common -- the person that both main characters go to for advice -- and that both of the secondary characters have screaming children. The lawsuit was filed in a federal court in January, alleging copyright infringement and seeking unspecified damages.”
Judd Apatow, through his reps, released a statement:
"The book 'Knocked Up' is very different than the film 'Knocked Up.' The book is about a woman who gets pregnant by the fiance that she loves on the night of her engagement party. The film is a very different story; the film is about a one-night stand between a pot smoking slacker and an ambitious young woman that leads to a pregnancy and their attempts to get to know each other. Anyone who reads the book and sees the movie will instantly know that they are two very different stories about a common experience."
I reached out to Ms. Eckler about the matter, and she let me know that “We settled to the mutual satisfaction of both parties,” which is interesting since prima facie there may not have been actual proof that Mr. Apatow had access to Ms. Eckler’s book.
5) MONTZ v. PILGRIM FILMS TELEVISION INC NBC
In another case: A Federal copyright claim won’t always preempt a state-law claim for implied contract, particularly when submitting a pilot or series pitch to a studio. In simpler terms: A party can sue a television network if a network rejects his idea, only to use it on its own years later.
Larry Montz (a parapsychologist, or researcher into psychic abilities), and Daena Smoller (a publicist and producer) filed a lawsuit against NBC in 2006, arguing the Peacock company breached an implied contract. They claimed to have met with representatives of NBC/SyFy and others between 1996 and 2003, pitching a show about investigators traveling with high-tech equipment to track reports of paranormal activity.
At the time, NBC indicated to Montz that it was not interested in his ideas. Three years later, however, NBC produced “Ghost Hunters.” The lawsuit claimed that NBC used their materials and ideas to partner with Pilgrim Films to produce “Ghost Hunters,” about a crew that investigates sites said to be haunted.
Originally, the suit was dismissed after the District Court sided with NBC, saying copyright law does not protect ideas and concepts, only writings and other works of authorship, concluding that copyright law preempted the state law claims of breach of implied contract and breach of confidence.
However, the 9th Circuit Court of Appeals reversed that original finding, concluding that the suit was broader than a copyright claim because the studio had violated a contract with the two plaintiffs and sought compensation under state law, a right recognized by the California Supreme Court since 1956. According to Judge Mary Schroeder the state law provides:
"some protection for those who wish to find an outlet for creative concepts and ideas but with the understanding that they are not being given away for free. Without such legal protection, potentially valuable creative sources would be left with very little protection in a dog-eat-dog business."
Essentially, the 9th Circuit’s reasoning focused on the fact that the California Supreme Court has previously recognized the implied contract that is created between a writer and a producer, where an idea is disclosed to the latter under the premise that compensation would follow, should the idea be used. The issue was discussed previously by the 9th Circuit in Grosso v. Miramax, where the court ruled that an implied contractual claim is not preempted by federal law. The essential threshold, the court stated in its opinion, is that the state cause of action should assert rights that are qualitatively different from the rights protected by copyright. This echoes the conclusions of the Berne Convention.
The court found that:
"[T]he contractual claim requires that there be an expectation on both sides that use of the idea requires compensation, and that such bilateral understanding of payment constitutes an additional element that transforms a claim from one asserting a right exclusively protected by federal copyright law, to a contractual claim that is not preempted by copyright law."
A lawyer for the plaintiffs, Graham LippSmith concluded:
"It's a big issue for the entertainment industry. It means the little guy is still going to be protected, people trying to find their way into the entertainment industry."
6) Dan Rosen / Shame on You v. Elizabeth Banks
According to The Hollywood Reporter:
The allegation of an actual meeting with Banks, if true, is impactful for two reasons. First, under what's known as the inverse ratio rule, a high degree of access to the plaintiff's work may allow the plaintiff to prevail on a copyright claim with a lesser degree of similarity. And second, the implied contract claim means that when Rosen had his meeting with Banks and Handelman, he could be deemed as having a rightful expectation of payment if his material was later used. On the other hand, coincidences do occur, and some ideas are generic and non-protectable. If the film project came about through independent creation, the lawsuit would fail.
The inverse ratio rule says that when the showing that the defendant had access to plaintiff’s work is very strong, the bar for showing similarity between the works is correspondingly lower. In addition, when the showing similarity between the works is very strong, the bar for showing that the defendant had access to plaintiff’s work is correspondingly lower. Not all circuits follow this rule. For instance, the Second Circuit has rejected it. The Ninth Circuit does follow the inverse ratio rule. It is a part of the extrinsic analysis in the extrinsic-intrinsic test.
B) Quebec/Canada case law
Quebec, where my company is headquartered and I reside, relies on the civil code and not common law.
7) In Robinson v Cinar Corp
According to the CBC:
“The Supreme Court of Canada has found in favour of Quebec animator Claude Robinson after a 20-year legal battle, ruling that Montreal-based production company Cinar violated his copyright and must pay compensatory damages. Robinson created a cartoon character and show called The Adventures of Robinson Curiosity in the 1980s. The show, inspired by Daniel Defoe's novel Robinson Crusoe, was shopped around.
Almost a decade later Robinson saw a similar show called Robinson Sucroe — which became quite popular. He sued for copyright infringement. Robinson won at the Quebec Court of Appeal in 2009, which ruled that the Montreal-based production company, Cinar, had essentially copied his idea.”
What I found fascinating in this precedent is that the underlying story was i) actually based on a public domain work, for one, and ii) relies on expert testimony to establish facts and findings. That Robinson Crusoe was based on a public domain story did not give Cinar a wanton right to pillage and plunder Claude Robinson’s rights as they saw fit.
Cinar, founded by a husband and wife duo of Micheline Charest and Ronald Weinberg, eventually crashed and burned due to accounting irregularities. I would add that if I were an enterprising young investigative journalist with an interest in white collar crime, I suspect the Canadian tax credit system which helps finance productions is likely to be a hotbed of dubious schemes and other financial irregularities… but we can leave that for another day, as well.
Are you not entertained?
If based on this you feel like you may have a case on your hands, consult a lawyer. In part 7, we will look at concepts like Damages… followed by Jurisdiction & Venue, Prescription or the Statute of Limitations, Discovery & Depositions & the risk of Destruction of Evidence. Meanwhile, if you want to share your experience or contact me, you can do so using this form.