26 April 2011

I Did My "Celebration" Yesterday

In dubious celebration of World Intellectual Property Day, herewith a few updates and thoughts thereon (sorry, I've been reading 1970s-era H'wood contracts a lot over the last few days...):

  • GBS Update: Nobody filed a timely notice of appeal from Judge Chin's 22 March 2011 ruling, so things will proceed in the District Court. The hearing that was set for yesterday has been delayed until 01 June 2011 (PDF), giving the [string of insults concerning egos and arrogance] organizations involved more time to come up with another flawed "proposed settlement" that concentrates more on administrative convenience and ensuring that the authors don't get individualized control and/or income than anything else.

    Meanwhile, Professor Samuelson demonstrates that she actually read the ruling and gives it some credence with a draft paper on what a legislative solution to the problems raised in the litigation might look like (PDF). I don't agree with everything in the paper, as it still fails to grasp that the default position of the various parties — that there is a valid means of avoiding direct contact with each author/copyright holder — cannot be mechanistically evaded without a fundamental alteration of copyright law. That said, it's a helluva lot closer to business-sense workability than anything else I've seen seriously proposed... which means, of course, that it has less than zero chance of getting through Congress.

  • Borders Bankruptcy Update: Borders is now trying to put further pressure on its landlords (and utilities, suppliers, etc.) by keeping open the option to close twenty-odd more stores. Ordinarily, it would be required to accept or reject leases in the very near future, and that would then become part of the reorganization plan. Instead, Borders wants to delay a final decision on the leases until approval of a reorganization plan.

    In one sense, this is a chicken-and-egg situation in which the Bankruptcy Code (in the interest of creating a uniform law) tries to say "egg comes first unless the judge says otherwise." That is, it is not logically reasonable to require such a strongly plan-shaping measure so early in the process. On the other hand, it also allows the debtor to discriminate against certain landlords, which is — in effect — like allowing the debtor to determine which creditors to pay at a higher rate. In short, this is as much about juggling chainsaws as it is about bankruptcy law and practice. Notice, too, that the primary people who could be affected by this decision — authors and store patrons — have exactly zero say in any of this. Now that's respect for World Intellectual Property Day!

  • Peter King tries to make sense of the ruling ending the NFL lockout yesterday and can't. He's a bright guy, but not a civil procedure geek (for which he, and his audience of football fans, are probably quite thankful).

    Basically, what happens next is this: First the District Court judge who just issued the ruling will rule whether to stay it pending appeal; then the Eighth Circuit Court of Appeals will rule whether to stay it pending appeal; then the appeal of this ruling will proceed in front of the Eighth Circuit and — unless the Eighth Circuit stays both the ruling below and all other proceedings, which would be highly unusual — the rest of the antitrust matter will continue in front of the District Court. In the ordinary course of things the various stay rulings will be issued within the next week, and almost certainly less than that.

    So, what is it going to take for the league to win and get the lockout reinstated? Well, it is Easter/Passover season, so perhaps a miracle will be forthcoming... but I wouldn't count on it. Many employment lawyers point to the Eighth Circuit as being pro-employer, and in that sense they're right; that, however, neglects the procedural context. In this instance, the standard of review makes it extraordinarily difficult to reverse the District Court. On one level, a judge's decision on whether to grant a preliminary injunction is always reviewed for "abuse of discretion." The most common "abuse of discretion" is using the wrong law; thus, if the Eighth Circuit determines that Judge Nelson's legal analysis was blatantly wrong, the owners win. The problem is that her legal analysis is not blatantly wrong; those areas where there's room to disagree are precisely those in which the other barrier to reversal comes into play: The balance of equities and irreparable harms, and her findings of fact. In both of those areas, there's an even higher standard of review: "Clear and convincing error," which is roughly the civil litigation equivalent of "beyond a reasonable doubt." Further, there's another procedural reason for a court to refuse to reverse this particular injunction: The injunction does not concern an ultimate remedy in the litigation, but merely preserves a previously bargained-for result pending outcome of the entire case (and American Needle, holding that the NFL is subject to antitrust scrutiny for its licensing arrangements, is a heavy hand on the scale there... and requires the Eighth Circuit to reconsider some of its prior pro-employer precedents).

    Thus, if the owners don't get a stay allowing them to continue the lockout during appeal, I don't see them winning this appeal. Procedurally, there's too much of a mess. Score a touchdown for the players' lawyers.