1998 B.C. Intell. Prop. & Tech. F. 042401

Itar-Tass Russian News Agency v. Russian Kurier:
Federal District Court Applies the Berne Convention, United States and Russian Copyright Laws to Prevent Piracy in Mass Media

Maxim Voltchenko  fnA

April 24, 1998

The United States is well known for its vigorous protection of intellectual property rights owned by American nationals as well as foreigners. Similarly, the United States expects other nations to observe intellectual property rights of American nationals. Not surprisingly, the United States makes determined effort to urge other countries, especially the countries with emerging economies, to join the international treaties in the area of intellectual property. Virtually as a result of the United States' active policy regarding expansion of intellectual property rights protection in the international context, the two principal international documents in this area, the Berne Convention[1] and the Universal Copyright Convention[2], now have all major trade nations as their signatories. Russia, after modernizing its intellectual property laws in the early 1990s, acceded to the Berne Convention in 1995.

The Berne Convention and the Universal Copyright Convention are the two principal international conventions obligating signatory countries "to protect, in as effective and uniform a manner as possible, the rights of authors in their literary and artistic works."[3] These two treaties do not, however, constitute such a thing as "international copyright law" automatically protecting the copyright of each and every author in the world. Protection against unauthorized use in a particular country, whether a signatory to theses conventions or not, will depend on the national laws of that country.[4] The Berne Convention and the Universal Copyright Convention do, however, impose significant obligations on their members as to the legal protection afforded to foreign works.

The Berne Convention, the more authoritative of the two conventions, proclaims the two governing principles applicable in the international context: "minimum standards" and "national treatment." Under the minimum standards principle, a member of the Berne Union is required to protect foreign works if a very limited, easy-to-satisfy set of conditions is met.[5] Protection of foreign works, in particular, cannot be conditioned on registration or any other formality. The Convention does not however prohibit formalities as a prerequisite for certain types of remedies, licenses, procedural benefits, exemptions, etc. Under U.S. copyright law, for example, the availability of statutory damages depends on whether the copyright owner has registered its copyright in the U.S. Copyright Office. Similarly, the owner of a registered copyright will be entitled to compensation of its attorneys' fees in an infringement suit.

The application of the minimum standards principle together with "national treatment"[6] is demonstrated in Itar-Tass Russian News Agency v. Russian Kurier. [7] The Itar-Tass case is interesting not only for its application of the Berne Convention and U.S. copyright law to an unusual fact-pattern, but also because it extensively discusses and applies new Russian copyright law.

In 1997, the U.S. District Court for the Southern District of New York enjoined the defendants, a weekly Russian-language newspaper ("Kurier") published in New York City, and its owner from copying nearly verbatim whole sections of major Russian newspapers. The Court also awarded monetary compensation to the plaintiffs for damages sustained as a result of the unauthorized copying.
5
This lawsuit was initiated by major Russian newspapers (many of which are distributed in the U.S.) led by ITAR-TASS Russian News Agency.[8] As early as May 1995, the plaintiffs convinced the Federal District Court to issue a preliminary injunction against the defendants.[9] Then, in March 1997, the same court granted a permanent injunction against the defendants and awarded $500,000 in damages.[10] Finally, in June 1997, the Court addressed the issue of attorneys' fees and ordered that the defendants must compensate the plaintiffs for 50% of their attorneys' fees - approximately $180,000 out of $360,000.[11]

The issues litigated in Itar-Tass deserve special discussion. Unlike most copyright infringement cases, "substantial similarity" between the plaintiffs' and defendant's publications was not at issue. The defendant bravely admitted that he cut articles out of the plaintiffs' newspapers and published them in the Kurier. As their defense, the defendants argued that the plaintiffs had no protectable copyright interest in most of the articles taken from their publications. In Russia, as in most civil law countries, only individuals (natural persons) can claim authorship in their works. Therefore, organizations may not possess authors' rights. However, as the plaintiffs successfully argued, employers are in some situations given certain rights with respect to works made by their employees. Thus, as the defendants contended, the Court had to decide whether the plaintiffs' publications were protected under Russian copyright law.

Although the Itar-Tass court rendered a decision in favor of the plaintiffs, the Court's opinion is open to dispute as to the Court's interpretation of national treatment, a cornerstone principle of the Berne convention and the Universal Copyright Convention. The Court began its analysis by classifying the infringed works in two groups, 1) works registered under U.S. Copyright Law, and 2) Berne works.

The first group of works, the Court rightly noted, was protected under U.S. Copyright Law as "works made for hire" because these works were registered in the U.S. Copyright Office. The defendants attempted to question the protection of these works arguing that Russian Copyright law did not recognize the "works made for hire" concept for articles published in newspapers. The Court rejected this argument without lengthy discussion correctly stating that U.S. law, not Russian law, applied to works registered in the U.S. Copyright Office.

As for Berne works, the Court's rationale should be examined more closely. While the Court rightly determined that unregistered works published in Russia after March 13, 1995 (the effective date of Russia's adherence to the Berne Convention) were entitled to copyright protection under the Berne Convention, some observers criticize the Court's conclusion that Berne works were entitled to protection under U.S. law only if they were afforded protection under Russian law. As Professor Nimmer noted, the Court's finding that Russian law allowed the cause of action to proceed was unnecessary to its finding that the same case could proceed under U.S. law.[12] Professor Nimmer argues that the Berne works were protected under U.S. law by virtue of the national treatment principle regardless of whether they were protected under Russian law.[13]
10
Under the national treatment principle of the Berne Convention and the Universal Copyright Convention, the applicable law always is that of the state where the infringement occurred, not that of the state of which the author is a national, or in which the work was first published.[14] According to Professor Nimmer, the Itar-Tass Court should have applied U.S. law, not Russian law, in determining the protectability of the Berne works because the unauthorized copying by Kurier took place in the United States.[15] However, Judge Koeltl and some other commentators seem to disagree with that proposition, vigorously arguing that the validity of plaintiffs' copyright interest should be determined under the law of the country of origin. According to this approach, the Court, quite logically, focused attention on Russian, not U.S., copyright law.[16]

One could justify the Itar-Tass Court's logic by the vagueness of the Berne Convention's conflict-of-law provisions. Under article 5 of the Berne Convention[17], it is clear that the law of the country where protection is claimed (U.S. law in the Itar-Tass case) governs the issues of available remedies. Most commentators would also agree that U.S. law controls as to the issue of whether the infringed works are copyrightable.[18] But it is not entirely clear which law applies as to the issue of whether it is the plaintiffs who own the valid copyright interest in the infringed works. In other words, the Berne Convention provides no express choice-of-law solution to the question: who owns copyright. Nor does it contain any provisions concerning the "work-for-hire" (using the U.S. terminology) concept.

Despite the unavailability of any case law guidance, Professor Nimmer's interpretation of the Berne Convention conforms to the spirit of the Convention. The broader interpretation of the national treatment principle is justified by the Berne Convention's goal of effectively protecting foreign works. The application of U.S. copyright law to all the issues arising out of an infringement claim is also supported by relevant U.S. policy considerations. For example, judicial efficiency is better served when courts do not have to rely on translations of foreign statutes and case law, and the risk of distorted or inaccurate translations is abated. The application of forum law thus results in sounder decisions and increased certainty of law.[19] In determining whether the plaintiffs had a copyright interest in the works, the Itar-Tass Court, thus, should have relied on the U.S., not Russian, law.

Some may point out that the Itar-Tass Court's interpretation of the choice-of-law provisions might not have had any negative implications for the plaintiffs. After all, the Court did find that the plaintiffs had copyright interest in the infringed works under Russian law, and refused the interpretation of the Russian Copyright Act offered by the Defendants. While the Court's interpretation of the Russian Copyright Act was favorable to the plaintiffs, some think that the end result of this case could have been even more favorable to the plaintiffs had the Court applied U.S. law to the question of the plaintiffs' copyright interest.

First of all, under U.S. law it would have been substantially easier for the plaintiffs to show the plaintiff's copyright interest in the works copied in the Kurier. The Court would have simply employed the United States' firmly established works for hire doctrine for those works. The reported Court opinion reflects the fact that the plaintiffs invested a great deal of time and effort to persuade the Court that the Berne works were entitled to copyright protection under Russian law. If the Court had applied U.S. law to the issue of whether a valid copyright interest existed, the plaintiffs attorneys' fees would probably have been much less. This is important because the plaintiffs were required to pay 50 % of their attorneys' fees, about $180,000.
15
Another issue deserving examination is the copyright protection of unregistered, non-Berne works, works published before the date that the Russian Federation acceded to the Berne Convention, March 13, 1995. While the number of non-Berne works infringed is not insignificant - more than 100 works - the Court's opinion failed to address this issue for unknown reasons.

Both the United States and the Russian Federation, as the successor of the former Soviet Union, are signatories to the Universal Copyright Convention. The Universal Copyright Convention became effective in the territory of the former Soviet Union as early as May 27, 1973[20], so the unregistered, non-Berne works were, theoretically, protected in the United States as "Universal Copyright Convention-works." It remains unclear, though, if the Russian plaintiffs observed the necessary prerequisite for protection under the Universal Copyright Convention - the placement of the copyright notice. In any event, the Court should have at least addressed the possibility of copyright protection under the Universal Copyright Convention.

Despite the above-discussed imperfections, Itar-Tass is nevertheless an important precedent in fighting piracy in the international context, proving that foreign authors can protect their copyrights in the United States. Potential infringers, in turn, should not underestimate the copyright protection afforded by U.S. and foreign laws as well as by international treaties.


Footnotes

[ a ]Maxim Voltchenko is an associate with the intellectual property group of Eckert Seamans Cherin & Mellott in the firm's Philadelphia office; JD, Tomsk State University School of Law (Russia), 1993; LL.M. in International Business Law, Central European University (Budapest, Hungary), 1996; LL.M. Temple University School of Law, 1997. The author would like to thank Professor Michael Newcity and Professor Vratislav Pechota for their valuable comments on the draft of this paper and Lewis F. Gould, Jr. for his support of this research. Additional thanks to Kristen Mathews and Adam Scoville of the Intellectual Property and Technology Forum for their editorial suggestions and professionalism in publishing this article.
[1] The Berne Convention for the Protection of Literary and Artistic Works, September 9, 1886, as revised at Paris on July 24, 1971 and as amended in 1979, 102 Stat. 2853, 1161 U.N.T.S. 3 [hereinafter Berne Convention] (did not enter into force with respect to the United States until March 1, 1989).
[2] The Universal Copyright Convention, September 6, 1952, as revised at Paris on July 24, 1971, 25 U.S.T. 1341, 943 U.N.T.S. 178 [hereinafter Universal Copyright Convention]. The United States has adhered to both Acts of the Universal Copyright Convention - the Geneva Text and the Paris Text.
[3] Berne Convention, supra note 1, at 31; Universal Copyright Convention, supra note 2, at 194 ("... to ensure in all countries copyright protection of literary, scientific and artistic works").
[4] 3 PAUL GOLDSTEIN, COPYRIGHT Annex: 16 (2nd ed. 1998).
[5] See Berne Convention, supra note 1, art. 3, 1161 U.N.T.S. at 35.
[6] "National treatment" is discussed infra, ¦ 8, et seq.
[7] Itar-Tass Russian News Agency v. Russian Kurier, 42 U.S.P.Q.2d (BNA) 1810 (S.D.N.Y. 1997).
[8] The ITAR-TASS Russian News Agency was formerly government-run and known as the Telegraph Agency of the Soviet Union (TASS).
[9] Itar-Tass Russian News Agency v. Russian Kurier, 886 F.Supp. 1120, 1122 (S.D.N.Y. 1995).
[10] Itar-Tass Russian News Agency v. Russian Kurier, 42 U.S.P.Q.2d (BNA) 1810 (S.D.N.Y. 1997).
[11] Itar-Tass Russian News Agency v. Russian Kurier, Copy. L. Rep. (CCH) 27668, 1997 U.S. Dist, LEXIS 8297 (S.D.N.Y. 1997) (plaintiffs were not entitled to full compensation of their attorneys' fees because only a limited number of their works were registered in the United States Copyright office).
[12] See 2 DAVID NIMMER & MELVILLE B NIMMER, NIMMER ON COPYRIGHT § 7.16[B][1][b], n. 85 (1997).
[13] See id.
[14] See Berne Convention, supra note 1, art. 5(1), 1161 U.N.T.S. at 35; Universal Copyright Convention, supra note 2, art. II, 943 U.N.T.S. at 195.
[15] See 4 NIMMER, supra note 12, § 17.05.
[16] In establishing the plaintiffs' copyright interest under Russian law, the Court examined the battle of expert opinions provided by prominent experts in Russian law: Professor Vratislav Pechota, Professor Michael Newcity, Professor Peter Maggs, Michael Solton, Dr. Svetlana Rozina.
[17] Berne Convention, supra note 1, art. 5.2, 1161 U.N.T.S. 35, reads as follows: "The enjoyment and the exercise of the these [author's] rights shall not be subject to any formality; such enjoyment and such exercise shall be independent of the existence of protection in the country of origin of the work. Consequently, apart from the provisions of this Convention, the extent of protection, as well as the means of redress afforded to the author to protect his rights, shall be governed exclusively by the laws of the country where protection is claimed." (emphasis added).
[18] "To obtain relief against the unauthorized use of its work in another country, a United States copyright owner must show that its work is entitled to copyright protection in that country." 3 GOLDSTEIN, supra note 4, at 16:2. Although Professor Goldstein's example is the reverse of the Itar-Tass case, the principle illustrated remains the same: the applicable law is that of the state where the infringement occurred.
[19] See S.M. STEWART, INTERNATIONAL COPYRIGHT AND NEIGHBOURING RIGHTS 38 (1983).
[20] For insights concerning the Soviet Union's adhesion to the Universal Copyright Convention, see MICHAEL NEWCITY, COPYRIGHT LAW IN THE SOVIET UNION (1978).

© 1998 Maxim Voltchenko. Published with permission of the copyright holder.

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