IN THE UNITED STATES DISTRCIT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA
Alexandria Division
RELIGIOUS TECHNOLOGY CENTER )
)
Plaintiff, )
)
V. ) Civil Action No. 95-1107-A
)
ARNALDO PAGLIARINI LERMA, )
DIGITAL GATEWAY SYSTEMS, )
THE WASHINGTON POST, )
MARC FISHER, and )
RICHARD LEIBY, )
)
Defendants. )
MEMORANDUM OPINION
Before the Court is the Motion for Summary Judgement filed by
defendants, The Washington Post, and two of its reporters, Marc Fisher
and Richard Leiby (hereinafter referred to collectively as
"The Post"). A court may grant summary judgement "only when there
is no genuine issue of material fact and the moving party is
entitled to judgement as a matter of law." Miller v. Leathers, 913
F.2d 1085, 87 (4th Cir. 1990) (citing Fed. R. Civ. p. 56 (c)). In
ruling on such motions, the court must construe all facts and all
inferences drawn from those facts in favor of the non-moving party.
Charbonnagas de France v. Smith, 597 F.2d 406, 414 (4th Cir. 1979).
Having performed this analysis, the Court finds that summary
judgment should be entered in favor of the defendants.
1. UNDISPUTED FACTS
The essential facts are not in dispute. In 1991, the Church
of Scientology sued Steven Fishman, a disguntled former
member of the Church of Scientology, in the United States District
Court for the Central District of California. Church of
Scientology Int'l v. Fishman, No. CV 91-6426. On April 14, 1993,
Fishman filed in the open court file what has come to be known as
the Fishman Affidavit, to which were attached 69 pages of what the
Religious Technology Center ("RTC") describes as various Advanced
Technology works, specifically levels OT-I through OT-VII
documents. Plaintiff claims that these documents are protected
from both unauthorized use and unauthorized disclosure under the
copyright laws of the United States and under trade secret laws,
respectively.
In California, the RTC moved to seal the Fishman affidavit,
arguing that the attached AT documents were trade secrets. That
motion was denied and the Ninth Circuit upheld the district court's
decision not to seal the file. Church of Scientology Int'l v
Fishman, 35 F.3d 570 (9th Cir. 1994). The case was remanded for
further proceedings and the district court again declined to seal
the file, which remained unsealed until August 15, 1995.
Defendant Arnaldo Lerma, another former Scientologist,
obtained a copy of the Fishman affidavit and the attached AT
documents. Lerma admits that on July 31 and August 1, 1995, he
published the AT documents on the Internet through defendant
Digital Gateway Systems ("DGS"), an internet service provider. RTC,
which regularly scans the Internet, discovered the publication of
documents and on August 11, 1995, warned Lerma to return the AT
documents and not publish them any further. After Lerma refused to
cooperate, RTC obtained a Temporary Restraining Order prohibiting
Lerma from any further publication of the documents and a seizure
warrant which authorized the United States Marshal to seize Lerma's
personal computer, floppy disks and any copies of the copyrighted
works of L. Ron Hubbard, the author of the AT documents.
During the same time period, on or about August 5 or 6, 1995,
Lerma sent a hard copy of the Fishman Affidavit and AT attachments
to Richard Leiby, an investigative reporter for the Washington
Post. On August 12, 1995, counsel for RTC discovered this
disclosure and approached the Post, which was told that the Fishman
affidavit might be stolen. In response to the RTC's
representations, The Post returned the actual copy which Lerma had
given it. However, the Post had by then learned that a copy of the
same Fishman affidavit was available in the open court file in the
United States District Court for the Central District of
California. On August 14, 1995, The Post sent Kathryn Wexler, a
news aide stationed in California, to that court to obtain a copy for
Wexler, who then mailed it Washington. Although it is
undisputed that RTC staff members had been checking that file out
and holding it all day to prevent anyone from seeing it, the file
was not sealed and obviously was available, upon request, to any
member of the public who wished to see it.
The day after the Post obtained its copy of the Fishman
affidavit, the RTC applied for a sealing order and the trial judge
ordered the file sealed. However, there is no evidence in the
record that the judge ordered The Post to reurn the copy made by
the Clerk'c office or that any kind of restraining order was
issued by that court against The Post.
Five days later, on August 19, 1995, The Post published a news
article, entitled "Church in Cyberspace: Its Sacred Writ is on the
Net. Its Lawyers are on the Case," written by defendant Marc
Fisher. In that article, RTC's lawsuit against Lerma and the
seizure of his computer equipment was discussed, as was the
history of Scientology litigation against its critics and the
growing use of the Internet by Scientology dissidents. The article
included three brief quotes (totally 46 words) from three of the
AT documents. On August 22, 1995, the RTC filed its First Amended
Verified Complaint for INjunctive Relief and Damages in which it
added The Washington Post and its two reporters, Fisher and Leiby,
as additional defendants. A Second Amended Verified was later
files and is now the subject of this summary judgement motion.
II. THE COPYRIGHT CLAIM
Although the Court has serious reservations about whether the
AT documents at issue in this litigation are properly copyrighted,
for the purposes of this motion, the Court assumes that the RTC
hold properly registered, valid copyrights for the AT documents
attached to the Fishman affidavit.
The Post does not deny that it copied the AT dcouments and
quoted from them. It argues, however, that this copying and these
quotations fall squarely within the "fair use" exception. Thus,
the dispositive issue as to the copyright claim is whether or
not The Post's use of the AT documents falls within the fair use
exception to the copyright law. Under that exception, "the fair
use of copyright ...for purpose such as criticism, comment,
new reporting ... or research, is not an infringment of
copyright." 17 U.S.C.A. & 107 (West Supp. 1995) (emphasis added).
As the Supreme Court has held "fair use is a mixed question of law
and fact." Harper & Row Publishers Inc. v Nation Enters, 471 U.S.
539, 560 (1985). In the instant case, the Court finds no material
facts in dispute; therefore, the issue can be resolved as a matter
of law.
At the outset of its opposition, the RTC argues that because
the fair use doctrine is an equitable one, The Post should not be
allowed to rely on this defense because of unclean hands.
Specifically, the RTC points to the Post's failure to disclose that
it had made several copies of the Fishman Affidavit. In an
affidavit signed on September 26, 1995, Mary Anne Werner, a Post
Vice President and counsel, averred that "only one copy of that
[Fishman] declaration has been made." In fact, through discovery
RTC learned, and the Post does not dispute, that other copies
were made. Wexler admits that she made an additional copy of the
materials received from the Clerk's office. She sent that copy to
Washington as well to ensure that Washington got a copy. A second
copy was created, not my copying the Fishman affidavit which had
been obtained in California, but by down loading a copy off the
Internet. The Post argues persuasively here that the presence of
the AT documents on the Internet was a part of their very news
worthiness and that making this copy was an act of legitimate news
gathering.
A third copy of the AT documents was generated after Lerma
sent a duplicate of the Fishman affidavit to Leiby via e-mail.
That e-mail was copied to a disk in response to demands by RTC's
counsel on August 22, 1995, that The Post secure any materials it
had been sent by Lerma. (Second Werner Decl. && 4-5).
None of these acts of copying strike this Court as
unethical behaivor and the Court is satisfied from her
second declaration that Ms Werner did not mislead the Court or
counsel in referring to one copy. In any case, the Court Aagrees
with The Post that the issue of unclean hands is a weak attempt by
RTC to avoid the real issue of fair use.
In determining whether the use of a copyrighted work is fair
use and therefore not an infringment, the Court must consider four
factors:
1. the purpose and character of the use,
including whether such use is of a commercial
nature or for nonprofit educational purposes;
2. the nature of the copyrighted work;
3. the amount and substantiality of the
portion used in relation to the copyrighted
work as a whole.
4. the effect of the use upon the potential
market for or value of the copyrighted work.
The fact that a work is unpublished shall not
itself bar a finding of fair use if such
finding is made upon consideration of all the
above factors.
17 U.S.C.A. & 107 (West Supp. 1995). These four statutory factors
may not "be treated in isolation, one from another. All are to be
explored, and the results weighed together, in light of the
purposes of copyright." CAmbell v Acuff-Rose Music Inc, 114 S. Ct.
1164, 1170-71 (1994). The interplay of the four factors is
recognized elsewhere as well. See, e.g., Sony Corp of America v
Universal Studios Inc., 464 U.S. 417, 449-450 (1984) (reproduction
of an entire work "does not have its ordinary effect of militating
against a finding of fair use" as to home videotaping of television
programs) ; Harper & Row, Publishers, Inc v National Enterprises,
471 U.S. 539, 564 (1985) ("[E]ven substantial quotations might
qualify for fair use in review of a published work or a news account
of a speech" but not in the scoop of a soon-to-be-published memoir).
Thus, we may not evaluate any single fair use factor in isolation.
As to the first factor, the purpose and character of the use,
there is no evidence in this record that the Post copied the AT
documents for any purposes other than news gathering, news
reporting and responding to litigation. Although the RTC has
argued that The Post harbors some animus towards Scientology, an
unbiased observer would conclude that the Church of Scientology and
its treatment of critics is a newsworthy subject about which The
Post is permitted to investigate and report. There is no evidence
that the Post was trying to "scoop" the RTC in quoting the AT
documents or trying to avoid payment of a royalty, conduct to which
other courts have looked in finding that a media organization
violated copyright. Harper & Row Publishers, Inc., vs Nation
Enterprises, 471 U.S. 539 (1985) ; Iowa State University Foundation,
Inc., v. American Broadcasting Co Inc., 463 F. Supp. 902
(S.D.N.Y. 1978).
Under the second factor, the scope of the fair use doctrine is
greater with respect to factual works than creative or literary
works. Hubbard's works are difficult to classify and courts
dealing with this issue have differred in their conclusion. As the
Second Circuit stated in New Era Publications Int'l v Carol
Publishing Group, 904 F.2d 152, 158 (2d Cir.), cert. denied, 111 S
Ct. 297 (1990) "reasonable people can disagree over how to classify
Hubbard's works." However, that court also concluded that
the works "deal with Hubbard's life, his views on religion, human
relations, the Church, etc. -- [and] are more properly viewed as
factual or informational." Id at 157. The United States District
Court for the Southern District of California is of another view,
however. In Bridge Publication, Inc. v. Vien, 827 F. supp. 629,
636 (S.D. Cal. 1993), the court stated that "[t]he undiputed
evidence shows that L. Ron Hubbard's works are the product of his
creative thought process, and not merely informational."
However, in this litigation the RTC has characterized the AT
documents essentially as training materials. Therefore, this Court
concludes that despite their obtuse language the AT documents are
intended to be informatinal rather than creative and, therefore,
that broader fair use approach is appropriate.
To evaluate the third factor, which essentially requires
making a qualitative as well as quantitative analysis of the use
made of the work, the three quotes need to be read in the context
of the article. The first and longest quote is obviously included
merely as an example of the obtuse language used in the AT
documents. No fair-minded reader could possibly construe this quote
otherwise.
Most of the 103 pages of the disputed texts
from the Fishman file are instructions for
leaders of OT training sessions. They are
written in the dense jargon of the church.
'If you do OT IV and he's still in his head.
all is not lost, you have other actions you
can take. Clusters, Prep-Checks, failed to
excercize directions.'
The second quote describes how in "one high level OT session
trainees are asked to pick an object 'wrap an energy beam around
it' and pull themselves toward the object." the last quote occurs
in the very next sentence which describes how trainees are to "be
in the following places--the room, the sky, the moon, the sun."
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These underlined words comprise the total of the copyrighted
materials quoted.
The RTC argues that where quotes, although fragmentary, are of
"significant material," even de minimis copying infridges. It then
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bootstraps this argument by claiming that because Fisher chose to
include these three quotes in his article, the quoted language must
necessarily be significant. Under this reasoning, no one, let
alone a newspaper, could ever quote from copyrighted materials
withour fear of being hauled into court for infridgment becuse
any quote would be deemed significant. To accept this argument
would essentially destroy the fair use doctrine. It also clearly
is unsupported by the facts because as discussed above, the three
quotes, read in context of the entire article, are offered solely
as illustrations of the authors claims about Scientology. They
are not intended to offer a complete definition of the Scientology
religion or to capture the total essence of what it means to be a
Scientologist.
Lastly, we must look at the effect of the Posts's use upon the
potential market for or value of the copyrighted work. Although
the RTC claims it has demonstrated an enormous effect upon its
potential market, a fair view of the record discloses no evidence
of any economic exploitation by the Post of RTC's copyrighted
material. As The Post cogently argues, no follower of Scientology
could possibly be satisfied by these three random fragments quoted
in its article so as to bypass the complete regime of
indoctrination.
Although both sides have raised numerous additional issues,
the essential analysis for the copyright claim comes down to these
four factors. Based on this analysis, we find for the defentants.
RTC properly argues that the mere existence of a copyrighted work
in an open court file does not destroy the owner's property
interests in that work. In the same way, the placement of a
copyrighted book on a public library shelf does not permit
unbridled reproduction by a potential infridger. However, RTC
cannot selectively avail itself of only a segment of the copyright
law. With preservation of copyright protection invariably
comes fair sue exemption, and on that ground the Post's actions
are proper.
III. ATTORNEY'S FEES
Because The Post has been found to be the prevailing party on
the copyright claim, it qualifies for an award of attorney;s fees
and litigation expenses. The RTC opposes such an award. Whether
to award such fees is a matter left to the Court's discretion.
Fogerty v Fantasy, Inc. --U.S.--, 114 S Ct. 1023, 1033 (1994)
In deciding the appropriateness of a fee award, the Court should
consider motivation of the plaintiff in bringing the action for
copyright infringement and the xtent to which plaintiff's position
is reasonable and well-grounded in fact and law.
On the first issue, the Court finds that the motivation of
plaintiff in filing this lawsuit against the Post is reprehensible.
Although the RTC brought the complaint under traditional secular
concepts of copyright and trade secret law, it has become clear
that a much broader motivation prevailed--the stifling of crticism
and dissent of the religious practices of Scientology and the
destruction of its opponents. L. Ron Hubbard, the founder of
Scientology, has been quoted as looking upon law as a tool to
[h]arass and discourage rather than to win.
The law can be used very easily to harass and
enough harassment on somebody who is simply on
the thin edge anyway, well knowing that he is
not authorized, will generally be sufficient
to cause his professional decease. If
possible, of course, ruin him utterly.
(Declaraction of Mary Ann Werner, Attachment A, at C5; see also The
Posts's reply brief at p. 24, note 23).
The context and extent in which the Post copies and quoted
from the AT documents was so de minimis that this Court finds that
no reasonable copyright holder could have in good faith brought
a copyright infringement action. Although there are limits beyond
which the media may not go, even in the interests of news gathering
and reporting, this case does not come anywhere near those limits
Therefore, an award of reasonable attorneys' fees is appropriate
and granted.
IV. MISAPPROPRIATION CLAIM
To prove misappropriation of a trade secret, the RTC must show
(1) that it possed a valid trade secret, (2) that the defendant
acquired its trade secret, and (3) that the defendant knew or
should have known that the trade secret was acquired by improper
means. Trandes Corporation v. Guy F. Atkinson, 996 F 2d 655, 660
(4th Cir. 1993), cert denied, -- US --, 114 S Ct 443 (1993).
The Post argues persuasively that the AT documents were no
longer trade secrets by the time the Post acquired them. They point
to the following undisputed facts. First, the Fishman
affidavit had been in a public court file from April 14, 1993 until
August 15, 1995, for a total of 28 months. although RTC has shown
that it went to extraordinary efforts to control access to that
file by having church members sign the file out and keep it in
thier custody at the courthouse, the file nevertheless was an open
file, available to the public. The Post was able to obtain a copy
of the Fishman affidavit withour any difficulty, by merely asking
the Clerk of the court to copy it. Thus, having been in the public
domain for an extensive period of time, these AT documents cannot
be deemed "trade secrets." Kewanee Oil Co. v Bicron Corp., 416
U.S. 470, 484 (1974)
Of even more significance is the undiputed fact that these
documents were posted on the internet on July 31 and August 1,
1995. (Lerma Affidavit). on August 11, 1995, this Court entered
a Temporary Restraining Order among other orders which directed
Lerma to stop dissemnating the AT documents. However, that was
more than ten days after the documents were posted to the internet,
where they remained potentially available to the millions of
Internet users around the world.
As other courts who have dealt with similar issues have
observed, "posting works to the internet makes them 'generally
known'" at least to the relevant people interested in the news
group. Religious Technology Center v Netcom On-Line Communications
Services, Inc., No. C. 95-20091 RMW (N.D. Cal.) Sl:p Opinion
entered 9/22/95 at 30. Once a trade secret is posted on the
Internet, it is effectively part of the public domain, impossible
to retrieve. Although the person who originally posted a trade
secret to the internet may be liable for trade secret
missappropriation, the party who merely downloads Internet
information cannot be liable for missappropriation because there
is no misconduct involved in interacted with the internet.
Even if one were to assume that the AT documents are still
of trade secrets is not committed by a person who uses or publishes a
trade secret unless that person has used unlawful means, or
breached some duty created by contract or implied by law resulting
from some employment or simliar relationship. (Smith c Snap-On
Tools Corp., 833 F 2d 578, 581 (5th Cir. 1988); Aerospace Am., Inc
v. Abatement Tech., Inc., 738 F Supp. 1061, 1071, (E.D. Mich.
1990).
It is the employment of improper means to
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procure the trade secret, rather than the mere
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copying or use, which is the basis of
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[liability].... Apart from breach of contract,
abuse of confidence or impropriety
in the means of procurement, trade secrets may
be copied freely as devices or processes which
are no secret.
Trandes Corporation v. Guy F. Atkinson Company, 996 F. 2d at 660,
(quoting the Restatement (First of Torts) (emphasis in original)
The Trandes court notes that abuse of confidence or impropriety in
the means of procurement represented the "essential element" and
the "core" of a misappropration claim. Id.
The RTC claims that because The Post was on notice of the
the RTC's allegations that the AT documents were stolen and were both
trade secrets and unpublished copyrighted works, the Post was under
a legal obligation not to copy the documents. This Court
knows of no law which required The Post to sit on its hands and do
no further investigation into what was obviously becoming a newsworthy
event and newsworthy documents. The RTC's allegations
are still just allegations. The very court from which the Fishman
affidavit was obtained still has under advisement the issue of
whether the AT documents are trade secrets. Although the Post was
on notice that RTC made certain proprietary claims about these
documents, there was nothing illegal or unethical about the Post
going to the Clerk's office for a copy of the documents or downloading
them from the Internet.
Because there is no evidence that the Post abused any confidence,
committed an impropriety, violated any court order or committed
any other improper act in gathering information from the
court file or downloading information from the Internet, there is
no possible liability for the Post in its aquisition of the
information. This is true regardless of the documents status as
trade secrets. As for disclosure of the information. The Post
did nothing more than briefly quote from publically available
materials. These acts simply do not approach a trade secret
missappropraition, and therefore, summary judgement must be entered
for the defendants.
The Clerk is directed to forward copies of this Memorandum
Opinion to cousel of record.
Entered this 28th day of November, 1995
signature
Leonie M. Brinkema
United States District Judge
Alexandria, Virginia