Industry Liabilities

The evolving world of technology has given birth to a generation of entrepreneurs—and after all, why wouldn’t it? The internet provides the ability to create e-commerce companies and social media websites allow for these companies to be promoted at little cost. When a new business concept is created it is understandable and expected to protect that new idea. For this post, I will deviate a bit from strategic marketing and focus on recent court cases that relate to copyright infringement and breach of contracts.

Penguin Group Inc. v. American Buddha

On March 25^th 2011, the U.S Appellate Court reviewed a case between Penguin Group Inc., a publishing company based in New York City, and American Buddha, a not-for-profit organization based in Arizona. Penguin Group Inc. claims that American Buddha committed copyright infringement by uploading four of the publishing company’s books on to the American Buddha website. The district court dismissed the complaint at the request of American Buddha for “lack of personal jurisdiction” (Penguin Group Inc. vs. American Buddha, 3).

Penguin Group Inc. appealed the decision, so the appellate court could decide if publishing the material on the internet, which allows content to be accessible by individuals within the state of New York, would prove that injury could have been sustained within the jurisdiction. Furthermore, Penguin Group Inc. argued that publishing copyrighted literature prevents authors from publishing work—for fear that they won’t be compensated, which would result in further injury.

In the end, the appellate court sided with Penguin Group Inc. by saying that, though the internet complicates the ability to determine where injury is sustained, American Buddha did commit copyright infringement.

In my opinion, the publishing of copyrighted material on the internet allows for anyone to view the content and should be viewed as copyright infringement—regardless of the state where the content was originally uploaded.

Case retrieved from: http://www.nycourts.gov/ctapps/Decisions/2011/Mar11/7opn11.pdf

Zyla v. Wadsworth Division of the Thomson Corporation

In 2001, Tufts University’s visiting professor Gail Zyla sued the Thomson Corporation, a textbook publishing company, for the unauthorized use of her work for the fourth edition of a nutrition textbook. After discord with the textbook’s co-author, Zyla withdrew as a contributor to the book—requesting that none of her work be included in the textbook. The withdrawal as a co-author reduced her royalties from 40% to 12.5%. The textbook did contain all of Zyla’s contributions; however, her royalties remained at 12.5%.

Zyla argued “copyright infringement; violation of Lanham Act; breach of contract; and intentional interference with advantageous relations” (Zyla vs. Wadsworth, ¶4). The lawsuit resulted in a judgment for the defendant, Thomson Corp., on all complaints.

If Zyla had agreed to a new contract that stipulated her work would not be included in the new textbook and reduced royalties, than I believe she should have received a judgment in her favor for at least breach of contract; however, my opinion differs from the ultimate decision after discovery.

Case retrieved from: http://caselaw.findlaw.com/us-1st-circuit/1253412.html

Chodos v. West Publishing Company Inc.

In December 2001, Rafael Chodos sued West Publishing Company for breach of contract after the publishing company rejected the manuscript that he was contracted to write because, after the manuscript’s completion, the publishing company decided that projected sales did not justify publishing the manuscript.

Chodos had signed a “standard Author Agreement” to write a law-related manuscript. After years of composing the work, the manuscript was considered of high quality, but, because of marketing and projected sales, it was rejected. Chodos sued for damages, stating that there was a breach of contract; however, the judge decided that the publishing company was within their right to reject the manuscript.

I can understand the devastation Chodos experienced after spending years satisfying his contractual obligations only for it to result in rejection and no potential of collecting royalties. Since the publisher considered the work high quality, the Author Agreement should have ensured some monetary compensation for Chodos’ time and effort. 

Case retrieved from: http://caselaw.findlaw.com/us-9th-circuit/1375991.html

In conclusion, it’s astonishing to see the outcome of lawsuits that seem valid. In most of the cases I reviewed, the courts sided with the large corporations—even when contracts were breached. Regardless, FindLaw.com proved to be a great resource for examining relevant cases in a variety of industries.

Sources

Chodos v. West Publishing Company Inc (2001). FindLaw.com. Retrieved on May 3, 2011, from http://caselaw.findlaw.com/us-9th-circuit/1375991.html

Penguin Group Inc. v. American Buddha (2011). FindLaw.com. Retrieved on May 3, 2011, from http://www.nycourts.gov/ctapps/Decisions/2011/Mar11/7opn11.pdf

Zyla v. Wadsworth Division, Thomson Corp (2001). FindLaw.com. Retrieved on May 3, 2011, from http://caselaw.findlaw.com/us-1st-circuit/1253412.html