Copyright Basics: 2

Gregory A. Piccionelli
In part one we looked at copyrights as property and the six separate rights granted to copyright owners. In today's conclusion, we'll examine copyright enforcement, statutory damages and beyond:

Until relatively recently, adult entertainment companies, with the exception of Playboy and a few others, did not generally enforce their intellectual property rights, such as their copyrights, very vigorously. However, because of rampant piracy of DVDs and photographs, Internet infringements, and unlawful distribution of content via peer-to-peer networks, all that has changed. In fact, over the past 10 years, most of our adult entertainment clients, including virtually every one of our large video production clients have either initiated or defended one or more copyright infringement actions.

A person or entity may be liable for damages to a copyright owner for copyright infringement if that person or entity exercises, without proper authorization, one or more of the exclusive copyrights listed above. In such cases, the copyright owner can bring a lawsuit in federal court to obtain dam ages and prevent the infringer's continued infringement of the copyright owner's work.

Statutory Damages
The basic measure of damages for infringement of a copyright is either the amount of money made by the infringer, or the amount of money lost by the copyright owner, due to the infringement. Unfortunately, filing a lawsuit in federal court and proving what an infringer made or what the copyright owner lost, is often an expensive proposition. Given the fact that a copyright owner is not automatically entitled to an award of attorney's fees if the infringement action is successful, many copyright owners have understandably elected not to file actions against even blatant infringers where the expense of the lawsuit would likely be greater than any realized monetary recovery.

Fortunately, copyright owners have another very powerful option. If the copyright in a work is registered with the Copyright Office prior to the infringement or within the first three months of publication of the work, the copyright owner can elect to seek "statutory damages" provided by the Copyright Act. This form of damages calculation allows the judge in a copyright enforcement action to award damages of up to $150,000 per work infringed regardless of the amount made by the infringer or the amount lost by the copyright owner.

Moreover, the statutory damages provision of the Copyright Act also entitles the copyright owner to seek, and be awarded, reasonable attorney's fees.

Because of the availability of statutory damages, the economics of enforcement of copyrights in the adult industry dramatically shift in favor of those that timely register their copyrights. In fact, we have settled numerous cases without having to commence a lawsuit. Often a "cease and desist" letter to which one or more copyright registrations are attached is enough to motivate the infringer to settle on terms favorable to our client. For example, thanks to the availability of statutory damages, we recently settled an action involving infringement of 32 registered works, in the mid-six-figures, without the need to commence a lawsuit.

Consequently, timely registration of copyrights is a good idea for producers of every type of adult content, including individual websites or even web pages. Moreover, the benefits of copyright registration become even more attractive, however, when one considers that the cost of registration is currently only $30 per work.

A Good Defense
The flip-side of knowing how to effectively enforce your copyrights is to know how to avoid infringement of another party's copyrights. As indicated above, a successful copyright enforcement action against an infringer can cost the infringer dearly.

Consequently, we always counsel our clients that license content not to use any content to which they do not have a clear written authorization to do so. This means a written license of rights with explicit representations and warranties that the licensor has all the rights allegedly licensed. Further, we advise clients to require that the licensor must agree to indemnify the licensee from any and all damages resulting from actions brought by third parties claiming rights in the content.

Of course, this article is only a basic introduction to issues involved in copyright exploitation, enforcement and infringement prevention.

Consequently, if you are an adult entrepreneur or are considering entering the business, we strongly recommend that you seek the counsel of a competent intellectual property attorney experienced in adult entertainment matters.

Gregory A. Piccionelli, Esq. is a senior member of Piccionelli & Sarno, one of the world's most experienced adult entertainment law firms, additionally specializing in intellectual property, Internet and traditional media matters. He can be reached at (310) 553-3375.

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