December 12, 2017

Answers To The Most 5 Frequently Asked Questions Regarding Data Protection in the United States

1. Are there any database protection rights in the United States? If so, could these be used to protect information such as sports fixture lists, timetables or other collections of data? Are there any decisions on the scope of protection and/or what can be protected?

2. Could such information be protected under copyright law and if so how? Has this protection been tested in any cases?

In the United States, database protection rights exist in only a few limited areas, including the protection of semiconductor chips and boat hulls.  Currently, no law exists that explicitly provides protection to databases and collections of data.  Although legislators have introduced bills in the United States Congress to protect databases, Congress has never enacted any of these bills into law.  Without these type of rights, collections of data only receive protection under if they can be protected under copyright law. Among other requirements to be protected under copyright law, the work has to be “original” which means that the work is independently created and not copied from other works.  (See 17 U.S.C. § 102(a).)  The copyright in a compilation or derivative work extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work, and does not imply any exclusive right in the preexisting material.  Thus, there is no copyright protection in the underlying facts or data in a compilation.  In addition, the United States Copyright Office has issued regulations prohibiting the use of copyright to protect “information that is common property containing no original authorship,” such as “schedules of sporting events[] and lists or tables taken from public documents or other common sources.”  (22 C.F.R. § 202.1(e).)The United States Supreme Court has also rejected protection for collections of data that lacked originality, explaining that “[f]acts, whether alone or as part of a compilation, are not original and therefore may not be copyrighted.  Pubs. v. Rural Telephone Serv. Co., 499 U.S. 340 (1991).  A factual compilation is eligible for copyright if it features an original selection or arrangement of facts, but the copyright is limited to the particular selection or arrangement.  In no event may copyright extend to the facts themselves.”  Id. at 350-51. The plaintiff had claimed that the defendant had violated copyright law by copying the names, towns and telephone number in a published telephone directory.  The Court denied copyright protection to this collection of facts because “there is nothing remotely creative about arranging names alphabetically.” Id   The Supreme Court also specifically rejected protection based on “sweat of the brow” to compile sets of facts without any originality in the compilation. Id. at 359-60. The Court stated that “originality, not ‘sweat of the brow,’ is the touchstone of copyright protection in directories and other fact-based works” and while it may not be a high standard “the selection and arrangement of facts cannot be so mechanical or routine as to require no creativity whatsoever.” Id. at 362.

Since this Supreme Court decision lower courts have therefore analyzed collections of facts and data for at least minimal originality in the selection and compilation.  Based on this standard, courts have found, for example, that projected automobile valuations satisfied the test for originality because “they represented predictions by the Red Book editors [and] were based not only on a multitude of data sources, but also on professional judgment and expertise” (See, e.g., CCC Info. Servs. v. MacLean Hunter Market Reports, Inc., 44 F.3d 61, 67 (2d Cir. 1994)) and a taxonomy of dental procedures, including “the short description and the number,” was subject to copyright because “[c]lassification is a creative endeavor.” American Dental Assoc. v. Delta Dental Plans Assoc., 126 F.3d 977 (7th Cir. 1997).  Conversely, other courts have refused to grant copyright protection (1) to the selection and arrangement of information concerning court opinions, such as data regarding the identity of the parties, the court, the date of decision, the identity of counsel, subsequent procedural developments, and opinion citations; (Matthew Bender & Co. v. West Publishing Co., 158 F.3d 674 (2d Cir. 1998)); (2) to a table concerning high school sports because “there is nothing original about simply selecting all of the generally available sports;” (Schoolhouse, Inc. v. Anderson, 275 F.3d 726, 730 (8th Cir. 2002)) and (3) to a table a collection of taxonomy because “[t]he mere fact that numbers are attached to, or are a by-product of categories and descriptions that are copyrightable does not render the numbers themselves copyrightable,” and that “the design, ordering, and sorting of transmission parts” was “practically inevitable” ATC Distribution Group, Inc. v. Whatever It Takes Transmissions & Parts, Inc., 402 F.3d 700, 708-09 (6th Cir. 2005).

3. If the information can be protected in any way (either copyright or data protection rights), what measures should the owners/creators take to ensure protection? What, if anything, would risk the loss of protection?

As explained above, facts alone are not subject to copyright protection in the United States.  United States copyright law protects collections and compilations of facts only to the extent that the selection and arrangement itself shows at least a minimum of the originality required by copyright law.

Some database owners have attempted to protect their uncopyrightable compilations via contractual licensing terms.  At least one court has held that that copyright law does not preempt the enforcement of a shrinkwrap license that prohibited the copying of an uncopyrightable database of telephone directories.(Compare ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996)). However, one of the leading scholar’s on copyright law has roundly criticized this decision as leading to a “parade of horribles” if parties could use contract law to circumvent the limitations of copyright law.  Nimmer on Copyright § 3.04[B][3][a].

4. If the information can be protected, what would be the typical licensing arrangements and royalty rates for other parties who want to use or reproduce the information?

Since the United States does not offer protection to databases and the information could only be protected if it qualified for copyright protection, the typical licensing arrangement and royalty rates would be based on what is customary in that area.  It is simply not possible to make generalizations about reasonable royalty rate because what would be considered reasonable for one type of information could be considered unreasonable for another type of information.

 5. Are there any questions regarding protection of information such as fixture lists that remain unresolved in your jurisdiction? If so, what are they and what are the possible resolutions? Are any cases pending?

Because copyright law in the United States is generally decided on a case-by-case basis within the courts rather than through strict statutory authority, each case must be analyzed on its own facts.  Although the compilation of information within a database requires only a bare minimum of originality to be eligible for copyright protection, courts considering similar facts have reached opposite conclusions about the copyrightability of databases.  For example, a number of courts have upheld contracts prohibiting the copying of databases, other courts have summarily rejected this position.  In short, this area of the law in the United States is still in a state of flux.

 

 

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