[00:00:06] Speaker 01: Good morning and may it please the court. [00:00:08] Speaker 01: My name is Tyler Newby and I represent Neo Cortex. [00:00:13] Speaker 01: Neo Cortex publishes an entertainment app. [00:00:17] Speaker 01: It allows users to draw from a library of preset images and GIFs, short videos that are taken from TV shows or from movies, and then take a photo of their own face. [00:00:30] Speaker 01: Neo Cortex Reface app then kind of melds those, the photo of the user's face, inserts it into the image or the video clip, and then creates a new entertainment photo. [00:00:47] Speaker 01: The users can then distribute those, and when they do that, if they are free users, it will include a watermark that says made by Reface. [00:00:58] Speaker 01: The claimant here, the plaintiff here is an actor, something of a minor celebrity who appeared on a TV show called Big Brother on CBS. [00:01:09] Speaker 01: One of his clips or some clips from that show were included in the preset libraries that were in the Reface app. [00:01:17] Speaker 01: And when somebody allegedly created a meld of their face with those clips, [00:01:26] Speaker 01: He claimed that that is a violation of his rights of publicity under California's Civil Code 3344. [00:01:37] Speaker 01: We filed a motion to strike in the district court and under California's anti-SLAPP law. [00:01:44] Speaker 01: And our position was that this is really an infringement or it's a lawsuit that is aimed at chilling the free expression of my client and of its users. [00:01:57] Speaker 01: The resulting images are ones that are created both from my client's speech and from the user's use of that. [00:02:05] Speaker 03: Can I move you ahead into discussion? [00:02:07] Speaker 03: Yes, Your Honor. [00:02:07] Speaker 03: So you both are fighting about whether the anti-SLAPP statute applies at all. [00:02:13] Speaker 03: Let's assume it does. [00:02:16] Speaker 03: And I'm just moving to the step two analysis in the anti-SLAP statute. [00:02:21] Speaker 03: The issue for decision for the district court was whether or not, in effect, the complaint should have been dismissed for failure to state a claim. [00:02:30] Speaker 03: It's a Rule 12b6 analysis. [00:02:34] Speaker 03: It may be a terrible complaint, but I'm having trouble figuring out why they didn't state a claim. [00:02:41] Speaker 03: All the elements. [00:02:42] Speaker 03: of the alleged tort, because it comes from a statute, seem to be pleaded. [00:02:49] Speaker 03: And you have some defenses, which seems to me would depend on development of facts. [00:02:55] Speaker 03: And so I'm trying to figure out why, at least at this stage, the 12b6 order isn't something we should affirm. [00:03:04] Speaker 03: So if you could sort of skip ahead in the argument to that and address that for me. [00:03:09] Speaker 01: Certainly. [00:03:12] Speaker 01: Two points there. [00:03:13] Speaker 01: One is, you're correct, it's a 12b6 standard for the anti-slap motion when it's based on an allegation that they have not pleaded. [00:03:22] Speaker 01: a cause of action under the law. [00:03:25] Speaker 01: And our first argument there was that what they have pleaded is essentially a claim that is preempted by Section 301 of the Copyright Act. [00:03:33] Speaker 03: Well, let's just stop for a second. [00:03:36] Speaker 03: But in order to do that, don't you have to establish facts not in the complaint, like that you have a copyright and the extent of the copyright? [00:03:46] Speaker 01: No, Your Honor, we don't. [00:03:48] Speaker 01: So copyright and the subject matter here, right, the copyright preemption analysis is a two-step analysis, and this is often, it can be raised and is raised at the 12b6 stage. [00:03:59] Speaker 01: What they've alleged is that there were videos taken from a television show. [00:04:05] Speaker 01: Those are fixed in a tangible medium. [00:04:07] Speaker 01: That is the subject matter of copyright. [00:04:10] Speaker 01: And secondly, that [00:04:12] Speaker 01: users using our app created a derivative work. [00:04:15] Speaker 03: Right, so your position is that you have an absolute right under the copyright laws to use the image from the show for any purpose whatsoever. [00:04:27] Speaker 02: Copyright Act doesn't give you the right to use the plaintiff's image. [00:04:34] Speaker 01: Well, so Your Honor, two questions there. [00:04:39] Speaker 01: First of all, the copyright preemption does not require us to have a license to use those works. [00:04:48] Speaker 03: No, but what's copyrighted is the work. [00:04:50] Speaker 03: Correct. [00:04:53] Speaker 03: You don't have a copyright in his image. [00:04:55] Speaker 01: Correct. [00:04:56] Speaker 01: And this is the issue. [00:04:57] Speaker 03: So I think there are lots of issues that might need to be tried over why you think you have a copyright in his image. [00:05:04] Speaker 01: We are not claiming that we have a copyright in his image. [00:05:07] Speaker 01: We are claiming that [00:05:08] Speaker 01: The right that he is claiming here is one that is preempted by the Copyright Act. [00:05:13] Speaker 01: And here's why. [00:05:15] Speaker 01: And this isn't the exact issue that came up in T3, the Maloney and T3 case and the Downing case. [00:05:21] Speaker 01: I think these are kind of the two cases that are [00:05:23] Speaker 01: competing against one another in this one. [00:05:26] Speaker 01: So in Maloney, this is the exact argument that the plaintiff made and what the plaintiffs here are making is that they're not seeking to enforce any rights under copyright. [00:05:37] Speaker 01: They're just seeking to enforce his right over his image or his likeness that appears in the video clips that are then distributed by users after they do this meld using reface. [00:05:47] Speaker 03: Well, they're not seeking to enforce a copyright. [00:05:50] Speaker 03: interest in his image. [00:05:52] Speaker 03: They're saying that you're using his image for an improper purpose. [00:05:56] Speaker 03: Their claim isn't that you can't publicize his image in general. [00:06:01] Speaker 03: Your claim is that you can't use it in order to promote a new product. [00:06:08] Speaker 01: That's always the claim in a publicity case, right? [00:06:11] Speaker 01: Yes, of course. [00:06:12] Speaker 01: And so that was the exact claim and the argument that this court addressed in Maloney and in the laws v. Sony Music case. [00:06:19] Speaker 01: So in those cases, Maloney, this is a case where a website was the licensed reseller of photos taken from NCAA events. [00:06:31] Speaker 01: And the athletes sued. [00:06:33] Speaker 01: And they said, well, you can't use these thumbnails of us in [00:06:38] Speaker 01: Sporting events to promote the sale of these photos and the court this court said well, that's what they're really arguing is that They are they're trying to stop the sale or distribution reproduction of copyrighted content and it's while they may say that they're trying to protect their image or their persona that's in those photos ultimately [00:07:04] Speaker 01: What is being sold, what's being advertised is a sale of a work in a tangible medium that is protected by copyright. [00:07:14] Speaker 03: But their images were the protected right, were they not? [00:07:20] Speaker 01: It was the photograph. [00:07:22] Speaker 03: Right, so that photograph was copyrighted, was subject to copyright protection. [00:07:28] Speaker 03: So we were dealing there with the, that was the entirety of the, and the claim was that the use of that photograph someplace else violates my privacy rights. [00:07:37] Speaker 03: Here we have a slightly different case because you will agree that [00:07:42] Speaker 03: image of their client is not subject to copyright protection. [00:07:47] Speaker 03: What's subject to copyright protection is the entire work. [00:07:51] Speaker 03: So in the case you're talking about, we were looking at the entire work and here we're looking at something that goes into the entire work. [00:08:00] Speaker 03: Is that the same? [00:08:01] Speaker 01: I think it's, so I would disagree that a clip, a still, an excerpt from a copyrighted television program is not subject to copyright. [00:08:18] Speaker 01: It's still within the rights of copyright. [00:08:20] Speaker 01: Whether that's an infringement or not, that's for another court to decide. [00:08:24] Speaker 02: So you license these clips from the creator of the clips? [00:08:29] Speaker 01: I'm sorry, in... Your client. [00:08:32] Speaker 02: How did they get the rights to show the club? [00:08:36] Speaker 01: So my client has a... And this is, again, I'm dealing with what's alleged in the complaint. [00:08:41] Speaker 01: What's alleged in the complaint is that they sourced this library of presets from a number of different other libraries, one of which is called Tenor. [00:08:52] Speaker 01: It is essentially a library that... Licensing libraries? [00:08:57] Speaker 01: They licensed a library from Tenor, which is a collection of GIFs, short video clips, and that is what fed into this library of presets that users were able to use. [00:09:11] Speaker 01: Some of those, and most relevant to this case, the clips from Tenor came from the television show, Big Brother, and one of the other shows that he appeared on on CBS. [00:09:25] Speaker 01: What is ultimately being used or done here is the creation of a derivative work from those clips. [00:09:35] Speaker 01: I don't think there can be any dispute that a television show or excerpts of a television show are subject to copyright. [00:09:43] Speaker 01: And similarly, the modification of that implicates the right to create a derivative work and to distribute it. [00:09:50] Speaker 01: Distribution, derivative works, those are fundamental rights of copyright. [00:09:54] Speaker 01: I'd also harken back to the law's case. [00:09:56] Speaker 03: I don't think anybody questions your ability to produce a clip and distribute it. [00:10:03] Speaker 03: The question is whether you can use his image in that clip. [00:10:07] Speaker 03: Because what eventually happens is his image gets placed onto something, right? [00:10:14] Speaker 03: You take the library. [00:10:16] Speaker 03: Somebody looks at the library, and they put their own face over his image or something like that. [00:10:21] Speaker 03: So the question is whether or not you can use that. [00:10:24] Speaker 03: to promote this other product, right? [00:10:26] Speaker 03: It's not whether or not if you had a derivative work, you'd be violating copyright law. [00:10:33] Speaker 03: That's not the issue. [00:10:35] Speaker 01: Well, I would agree that if this were a case like Downing, where my client were taking these clips, the melded clips, the refaced clips, putting out advertisements saying, hey, you too [00:10:50] Speaker 01: can do this, come subscribe, that's a different case, or come buy this other service. [00:10:56] Speaker 01: That's a different case. [00:10:57] Speaker 01: Ultimately, what's being distributed here are the modified derivative works. [00:11:01] Speaker 01: They're being distributed by users, not by my client, and those derivative works include a watermark that identifies Reface as the source of those works. [00:11:12] Speaker 03: Can I take you in a wholly different direction for a second? [00:11:16] Speaker 03: Absolutely. [00:11:17] Speaker 03: One of the issues in this case is whether the NSLAP law applies in the federal court and whether or not we have jurisdiction over interlocutory appeals. [00:11:26] Speaker 03: There is currently pending an in-bank case that raises those issues. [00:11:32] Speaker 03: I think it's fair to say that whether it's that case or some other case, this court will resolve those issues in the next six months to a year. [00:11:41] Speaker 03: in which case we would just hold on to this case and wait till then. [00:11:45] Speaker 03: And my prediction is we will find, but I only predict that there is no jurisdiction. [00:11:51] Speaker 02: But there may be a compromise. [00:11:52] Speaker 02: Yeah, who knows. [00:11:53] Speaker 03: But I guess what I'm suggesting to both parties is the most likely outcome of today's case, given these other cases pending, is that we'll just hold on to it. [00:12:06] Speaker 03: And we'll hold on to it until those other cases are resolved. [00:12:09] Speaker 03: Put aside my prediction about how they will turn out. [00:12:12] Speaker 03: Does it make sense for both parties, under these circumstances, just to go back to the district court and file summary judgment motions and get what will be, even after these cases are decided, a final, appealable order? [00:12:27] Speaker 02: In other words, do you want to be stuck in limbo? [00:12:30] Speaker 03: You want to be stuck here? [00:12:31] Speaker 03: You seem to have some really good arguments. [00:12:33] Speaker 03: I'm not sure they defeat the 12b6 motion, but they might well succeed on summary judgment. [00:12:38] Speaker 01: Hope springs eternal on my side that the court will continue to follow its precedent on the eerie issue and the collateral order issue. [00:12:48] Speaker 00: I think the question is that even if that is ultimately the decision of this court, it's going to take some time to [00:12:56] Speaker 00: deal with the current case that's sitting on Bonk and other, just earlier this week or last week, there was another order from another three-judge panel on a case requesting briefing to take a case relating to the appealability of a denial of an anti-slap motion on Bonk. [00:13:15] Speaker 00: It's going to take some time for this court to get out a ruling on this issue, and you might very well be right that the ultimate conclusion is that these [00:13:25] Speaker 00: You can bring these appeals, but I think the question from this panel is, as opposed to holding this pending that decision of an en banc or perhaps the party should go back and continue to litigate these issues to summary judgment. [00:13:42] Speaker 03: I'm not demanding. [00:13:43] Speaker 03: I'm just raising this issue for both of you to consider. [00:13:46] Speaker 03: I think it will be a year. [00:13:48] Speaker 03: probably before we have a decision on this issue. [00:13:54] Speaker 03: And in the meantime, you'll both be twiddling your thumbs. [00:13:57] Speaker 00: I guess you're happy to stay here and just wait. [00:14:01] Speaker 01: Yes, and the reason why we brought this motion, my client's a small company, right? [00:14:04] Speaker 01: I know it doesn't matter if you're big or small or an individual or a corporation, the anti-SLAPP law applies equally, but the law is intended to protect speakers from the onerous costs of litigation in these cases. [00:14:19] Speaker 01: That is a substantial issue for my client. [00:14:21] Speaker 01: And this isn't just an individual case. [00:14:23] Speaker 01: This is a class case. [00:14:24] Speaker 03: So there's a whole procedure for it. [00:14:26] Speaker 03: You understand that we're probably not going to proceed when there are cases, in fact, cases pending, raising our whether we have the jurisdiction to proceed. [00:14:36] Speaker 02: We understand we're in line. [00:14:37] Speaker 02: So is there a way in which this case can be decided without reference to the anti-SLAPP? [00:14:43] Speaker 02: Or is that the only thing that gets you here on appeal is because anti-SLAPP [00:14:48] Speaker 02: is a collateral order over which we have jurisdiction on the appeal. [00:14:55] Speaker 02: I mean, is there a way we can decide this case without deciding the anti-SLAPP issue? [00:15:06] Speaker 01: Not at this stage. [00:15:07] Speaker 03: It would just be an interlocutory denial of a 12b6 motion. [00:15:11] Speaker 01: Correct. [00:15:12] Speaker 01: Which we can't decide. [00:15:12] Speaker 01: We'd have to take it up on mandamus. [00:15:14] Speaker 03: I understand your position. [00:15:16] Speaker 03: I just want to ask one question on the merits. [00:15:19] Speaker 03: Whose speech is at issue in this case, do you think? [00:15:23] Speaker 01: And I understand this is an issue that they have also raised. [00:15:28] Speaker 01: Our position is that it is both the speech of our client and of its users. [00:15:33] Speaker 03: How is your client speaking? [00:15:36] Speaker 03: putting their ultimate complaint is that this clip is in the library. [00:15:41] Speaker 03: So I'm trying to figure out why that speech, why putting a clip in a library is speech. [00:15:45] Speaker 01: The origin clip is part of ultimately what gets created or gets modified. [00:15:52] Speaker 01: And then the modification, which is started by the claimant or the plaintiff, but is enabled by my client's app. [00:16:04] Speaker 01: and then results in a final product, derivative work, that has a watermark that my client inserts. [00:16:12] Speaker 01: These are just the allegations. [00:16:14] Speaker 03: They're not complaining, I think, about the ultimate product. [00:16:21] Speaker 03: They're complaining about the use of their client's image as a [00:16:27] Speaker 03: as a step in creating the ultimate product. [00:16:31] Speaker 03: Because the ultimate product has my face in it, or the face of the user. [00:16:34] Speaker 03: He substitutes his face for their client's face. [00:16:37] Speaker 03: So I'm just trying to figure out where along the way you think your client is speaking. [00:16:42] Speaker 01: My client is speaking when it helps create. [00:16:44] Speaker 01: It is a part of the process of creating the resulting clip and the insertion of its watermark. [00:16:51] Speaker 02: It seems to me that the insertion of the watermark might be your client's speech. [00:16:57] Speaker 02: changing it to insert your own face's third party speech. [00:17:02] Speaker 01: It is partly third party speech. [00:17:04] Speaker 01: It's partly my client's. [00:17:06] Speaker 03: See, because they're not complaining about the creation of the watermark. [00:17:10] Speaker 01: They are. [00:17:10] Speaker 03: Well, I mean, at least I don't know how they can. [00:17:12] Speaker 03: What they're really complaining about, they're not complaining that a picture of me is created. [00:17:16] Speaker 03: What they're complaining about is that it was created off of a library that contains their client's picture, right? [00:17:23] Speaker 01: I think ultimately what they're complaining about is that the creation, the addition of the watermark on the resulting image is what makes it an advertisement and makes it a commercial use of their persona. [00:17:34] Speaker 03: Right, but that's not, but that's not, I see. [00:17:39] Speaker 03: So you think you might be able to, the case would be different if there were no watermark? [00:17:45] Speaker 01: I think we'd have to ask the plaintiff that, but that's how I read their complaint. [00:17:50] Speaker 01: I'd like to reserve the rest of my time. [00:18:04] Speaker 04: Hello, Your Honors. [00:18:05] Speaker 04: Aaron Lawson on behalf of the plaintiff, Kylan Young. [00:18:08] Speaker 04: I'll begin with the very practical question that was posed. [00:18:11] Speaker 04: And in short, I think we would prefer to continue developing the record. [00:18:16] Speaker 03: Of course you would. [00:18:17] Speaker 03: Yeah, absolutely. [00:18:18] Speaker 03: That's why I asked him. [00:18:20] Speaker 04: And I believe that the case has only stayed because of a stipulation, because this is a collateral order in this court, and so this appeal would jump the line and ordinarily wouldn't take as long as a traditional appeal. [00:18:32] Speaker 04: And if that's not going to be the case, I think our position on that stipulation would change, and we'd probably ask the district court if we could just get moving again. [00:18:39] Speaker 03: I'm not sure you can, the case is appropriately in front of us. [00:18:43] Speaker 03: I'm not sure that the district court has jurisdiction to continue to proceed with respect to a collateral order over which we have jurisdiction. [00:18:54] Speaker 03: You're certainly free to make an argument to the district court, but your friend will be back here in 20 minutes if you do. [00:19:00] Speaker 02: You would have to remand it for the district court to proceed. [00:19:05] Speaker 04: You could, I suppose, also [00:19:07] Speaker 04: I imagine there's a mechanism where we could ask the district court to certify the appeal under 1292B. [00:19:14] Speaker 03: I don't think you can certify a question that's already subject to 1291. [00:19:21] Speaker 04: Well, if you certify the motion to dismiss as it's by itself, which is ostensibly distinct from the motion to start. [00:19:27] Speaker 03: You'd be certifying to us. [00:19:28] Speaker 03: We're not going to take it. [00:19:31] Speaker 02: I don't think the certification is appropriate under 1292. [00:19:36] Speaker 04: So there may be no practical solution here. [00:19:39] Speaker 03: Yeah, no, I think the bottom line is that you may be just stuck for a year on a case that stayed and whether or not the stay can be partially lifted to allow discovery or something, I don't know. [00:19:51] Speaker 03: But I think that's a quite realistic possibility. [00:19:57] Speaker 04: slings and arrows of appellate practice, I suppose. [00:19:59] Speaker 00: I mean, alternatively, we can apply our precedent as it currently stands and decide these issues. [00:20:04] Speaker 00: You could, yes. [00:20:05] Speaker 00: So maybe you can answer for me why, assuming we agree that the public interest exemption applies, why isn't this artistic work? [00:20:17] Speaker 04: Well, I don't think we necessarily disagree that the image that is generated by the user sands the watermark is something that might qualify as artistic work. [00:20:27] Speaker 04: There's very little precedent on that, of course, in the California courts. [00:20:30] Speaker 04: The only published decision I could find says that a theme park is not an expressive work and not an artistic work. [00:20:36] Speaker 04: But what we are objecting to is the use of that image with the watermark to solicit downloads and purchases of this app. [00:20:44] Speaker 04: And so I think. [00:20:45] Speaker 03: Well, but that's why I'm having trouble understanding your privacy claim. [00:20:51] Speaker 03: Your claim is that they are using your client's image to promote their product, correct? [00:20:57] Speaker 04: Yes. [00:20:58] Speaker 03: Your client's image is not in the watermarked product, is it? [00:21:04] Speaker 03: What's in the watermarked product is my image, the user. [00:21:08] Speaker 03: I substitute my face for your client's face. [00:21:11] Speaker 02: Isn't it just the face that's been substituted in the rest of the image? [00:21:15] Speaker 03: So is he arguing that his body is what the violation of the right of publicity is? [00:21:22] Speaker 04: Yes, yes. [00:21:23] Speaker 04: that the cases have said that likeness is about really identifiability. [00:21:27] Speaker 04: It's not just the face. [00:21:28] Speaker 04: It's can we tell who the person is? [00:21:29] Speaker 04: And I think the district court's observation is really, it's really germane here is that the rest of the body stays the same. [00:21:37] Speaker 04: And this image is, it's presented in an image in the context in which it became famous, right? [00:21:42] Speaker 04: So for Mr. Young, it's an image. [00:21:45] Speaker 03: So you're not complaining about his actual image being in the library? [00:21:52] Speaker 04: That is not the subject of the publicity. [00:21:55] Speaker 03: So your only complaint is that, as your friend says, when this watermarked version for non-subscribers is produced, that violates his right of privacy. [00:22:06] Speaker 04: Right. [00:22:07] Speaker 03: At that point, they're using... Let's assume for subscribers who don't get the watermark on it. [00:22:14] Speaker 03: you're not making a claim that that violates your right of privacy? [00:22:17] Speaker 04: That the mere use without the watermark, no, that's not the subject of this publicity claim. [00:22:22] Speaker 02: It's just the use of the likeness to advertise to solicit subscribers. [00:22:28] Speaker 02: That's the crux of your claim. [00:22:30] Speaker 04: That is the claim, yes. [00:22:32] Speaker 02: Okay. [00:22:34] Speaker 04: So I think I'll continue with sort of the 12b6 issues. [00:22:40] Speaker 04: The copyright issue, I think the district court got this exactly right. [00:22:43] Speaker 04: The question when we're applying copyright preemption to a right of publicity claim is, does the claim focus on use of the likeness or is the likeness invoked as a pretext to prevent distribution of the underlying work? [00:22:56] Speaker 04: I think that's what this court said in the Laws case, right? [00:23:00] Speaker 04: Are you focused on [00:23:01] Speaker 04: on the likeness used in that case it was merchandising used to help sell a product or are you using it to fight over control of the work and we're not trying to prohibit distribution of episodes of Big Brother we're not trying to prohibit [00:23:16] Speaker 04: uh, stills and, uh, clips, uh, from episodes of Big Brother or The Challenge. [00:23:21] Speaker 04: It's just the use of Mr. Young's likeness and the likenesses of other class members to advertise for this app. [00:23:27] Speaker 04: So I think this is very clearly on, uh, the, the non-preempted side of the line as the district court concluded. [00:23:34] Speaker 04: Uh, on, on the, uh, the transformative use defense. [00:23:38] Speaker 04: very briefly. [00:23:39] Speaker 03: This is a state law transformative use defense, not a copyright law transformative use defense, is it? [00:23:48] Speaker 03: Well, I think it is developed by the California Supreme Court, but my understanding of the— But the California Supreme Court is developing it in its interpretation of this statute, right? [00:23:57] Speaker 02: rights of publicity, which is really odd. [00:24:00] Speaker 03: Yeah. [00:24:01] Speaker 04: So I think that the work that it's doing is that the Supreme Court's zucchini decision tells us that we have to somehow balance First Amendment rights with the right of publicity, that the First Amendment rights are not absolute. [00:24:14] Speaker 03: No, but I'm trying to figure out what the scope was. [00:24:16] Speaker 03: So in other words, if this were a copyright case, and they were suing you for violating their copyright in the underlying clip, [00:24:27] Speaker 03: I'd have, we'd be fighting about whether or not putting a different face on it was a transformative use. [00:24:33] Speaker 04: A fair use, probably. [00:24:34] Speaker 03: Is that what we're fighting about here, too? [00:24:36] Speaker 03: Or is it a different test? [00:24:37] Speaker 04: It is very similar. [00:24:38] Speaker 04: And I think Comedy 3 is very self-aware about this. [00:24:42] Speaker 04: They're pulling this from fair use. [00:24:45] Speaker 02: They simply said that they feel that they have to balance the right of publicity with the First Amendment. [00:24:50] Speaker 02: And they're going to borrow from the copyright law of fair use, which has a lot of other [00:24:55] Speaker 04: Well, yes, they did reject about half of the traditional fair use test in this application. [00:25:01] Speaker 03: Is that a legal test or a factual test? [00:25:04] Speaker 04: I think it's largely factual. [00:25:07] Speaker 04: But at this stage, the question is simply, can we establish it as a matter of law? [00:25:10] Speaker 04: And I think the answer is pretty clearly no. [00:25:13] Speaker 04: that the defendant can't establish this as a matter of law because, well, for two reasons. [00:25:18] Speaker 04: One, the only change to the likeness is to the face. [00:25:21] Speaker 04: There's no change to the context, to any other part of the body. [00:25:24] Speaker 04: You are supposed to be able to tell who this person in the image is before the face has been changed. [00:25:31] Speaker 04: And so I think that the Hilton case is our best case there, right? [00:25:35] Speaker 04: You had Paris Hilton's likeness. [00:25:36] Speaker 04: It was modified in a number of ways, many more ways than we have here. [00:25:40] Speaker 04: But you could still tell it was Paris Hilton. [00:25:43] Speaker 04: this court said that doesn't establish this defense as a matter of law. [00:25:47] Speaker 04: And I think there's a principle from some of the video game cases, the Band Hero case, the NCAA football case. [00:25:55] Speaker 04: In those cases, you had identical likenesses. [00:25:58] Speaker 04: They were set within a much broader context, which was the original work of the video game developers. [00:26:03] Speaker 04: But what the court said is, look, you are exploiting the likeness to sell this game. [00:26:09] Speaker 04: the commercial value of this is coming from. [00:26:11] Speaker 04: And I think that is also true of this app. [00:26:14] Speaker 03: So let's go back to their copyright defense. [00:26:16] Speaker 03: Because the third one is that you didn't sufficiently plead knowing this. [00:26:20] Speaker 03: And let's skip that for a moment. [00:26:23] Speaker 03: On their copyright defense, what they're saying is, we have the copyright in these clips. [00:26:31] Speaker 04: Well, someone has a copyright. [00:26:32] Speaker 03: Someone has a copyright in these clips, not us. [00:26:34] Speaker 02: And we assume they're licensing. [00:26:36] Speaker 04: Oh, I think part of the reason this looks weird is that that's an open question. [00:26:40] Speaker 03: Thank you. [00:26:42] Speaker 03: That's what I was trying to get to, and Judge Wardlaw sort of. [00:26:45] Speaker 03: Is there an open factual question about whether or not the defendant in this case has the ability to assert the copyright law? [00:26:56] Speaker 04: Well, yes. [00:26:59] Speaker 04: I don't think it is this question necessarily because, again, for preemption specifically, we're looking at, is it copyrightable? [00:27:09] Speaker 04: And if you look at, I'll say... No, I understand your preemption argument. [00:27:13] Speaker 03: Well, but I... I'm trying to figure out a different argument, which is that would there have to be some factual development at the trial court concerning the standing [00:27:24] Speaker 03: of this defendant to assert a preemption defense. [00:27:28] Speaker 03: Normally we hear a preemption defense from a copyright holder or a licensee, and I'm trying to figure out whether I know on this record what these guys are. [00:27:40] Speaker 04: I think our position would be that I'm not sure that that matters to their ability to assert preemption as a defense necessarily. [00:27:48] Speaker 03: So I can assert copyright preemption as a defense in your case? [00:27:52] Speaker 04: Well, it would be odd for you to come in as a third party. [00:27:56] Speaker 03: Don't you have to have some relationship to the copyright? [00:28:01] Speaker 04: Often, I mean, it's a weird question, because I'm not sure I can think of a case off the top of my head where it hasn't happened. [00:28:08] Speaker 02: It can't be abstractly preempted. [00:28:12] Speaker 02: It has to be in the context of a copyright holder's rights. [00:28:15] Speaker 02: In a context of a claim. [00:28:16] Speaker 03: In other words, are they entitled to assert preemption? [00:28:20] Speaker 03: And they may well be. [00:28:21] Speaker 03: They may be a licensee. [00:28:22] Speaker 03: They may have been assigned the rights of the copyright holder. [00:28:26] Speaker 03: I don't know. [00:28:27] Speaker 03: I'm trying to figure out whether I know that they're entitled to assert [00:28:31] Speaker 03: complete preemption defense. [00:28:34] Speaker 03: In other words, do they have any interest whatsoever in the copyright? [00:28:37] Speaker 04: Well, I think they'd probably tell you. [00:28:41] Speaker 04: I would suggest no, but I cannot give you a case off the top of my head. [00:28:44] Speaker 02: Does you have to continue discovery to determine that? [00:28:46] Speaker 04: That would be useful. [00:28:47] Speaker 04: We might also [00:28:48] Speaker 04: want to determine the extent to which AI is involved here and whether the resulting of images produced by this app are even copyrightable for lack of human authorship. [00:28:59] Speaker 04: I mean, these are all sort of open questions related to copyright. [00:29:03] Speaker 04: I think the district court got it exactly right, though. [00:29:05] Speaker 03: Well, because the part of the image you're complaining about was not created by AI. [00:29:09] Speaker 03: The part of the image you're creating about, you're complaining about, is the non-head part, is the non-head body. [00:29:16] Speaker 04: That's fair. [00:29:16] Speaker 03: We know that wasn't created by AI. [00:29:18] Speaker 03: It came from there, came to the library, the clips in their library. [00:29:22] Speaker 04: But I think there's some question about it. [00:29:24] Speaker 04: At what point do we not have enough human authorship? [00:29:27] Speaker 04: But for present purposes, this claim focuses on the use of the likeness. [00:29:32] Speaker 04: The likeness is not copyrightable. [00:29:33] Speaker 04: And I think that we can just end the discussion right there. [00:29:37] Speaker 04: I think the district court got that exactly right. [00:29:39] Speaker 04: That, unless you want to talk about the knowing piece, the knowingly piece of the 12b6 part of this appeal. [00:29:47] Speaker 03: Well, is there a knowing requirement? [00:29:49] Speaker 03: The statute seems to say so. [00:29:50] Speaker 04: Yes, it does have to be knowingly. [00:29:51] Speaker 03: And did you plead it? [00:29:53] Speaker 04: I believe that we did. [00:29:54] Speaker 04: It can be either actual or constructive knowledge. [00:29:58] Speaker 04: California cases say that to act knowingly means to act with awareness of the relevant facts. [00:30:04] Speaker 03: Did you plead constructive knowledge? [00:30:05] Speaker 04: And I think you can infer constructive knowledge from the fact that we have [00:30:09] Speaker 04: a library that's been compiled by the defendant that is searchable by name, and this is what the district court said, and I think you got this exactly right, that that suggests that they should know who is in this library and whose images are being used to solicit down- One reason I didn't ask about it is it seems to me an unsatisfactory solution. [00:30:26] Speaker 03: If we find that you didn't plead knowledge sufficiently, it'll go back to the district court and you'll plead knowledge sufficiently. [00:30:36] Speaker 03: So there may be a fault in your pleadings, but it doesn't seem to me this is a case in which you can't plead constructive now. [00:30:43] Speaker 03: You can't plausibly plead constructive. [00:30:46] Speaker 04: I agree. [00:30:46] Speaker 04: I think we've already done so. [00:30:48] Speaker 04: In the district court, the defendant's principal argument was, well, we don't have a [00:30:52] Speaker 04: a library of these images, we're just pulling them from the internet. [00:30:55] Speaker 04: But that I think is pretty well refuted by paragraph 15 of the complaint. [00:31:00] Speaker 04: And I think the district court recognized that that shows something sufficient for constructive knowledge. [00:31:05] Speaker 04: And I believe we'd be able to add to the complaint if this court thinks that is what needs to happen. [00:31:11] Speaker 04: So that is all of the real merits issues. [00:31:15] Speaker 04: Just briefly on whose speech this is in connection with a public issue, as the defendant has presented this case, it's the use of the images by the users to put their own face on the bodies of these celebrities. [00:31:28] Speaker 04: That's page 18 of their reply brief. [00:31:31] Speaker 04: We haven't found a case in which a defendant could invoke the anti-SLAPP law by relying on a third party's speech in connection with a public issue. [00:31:41] Speaker 04: The text of the law doesn't seem to support that either. [00:31:44] Speaker 03: Well, the text doesn't say anything about it, to be fair. [00:31:48] Speaker 04: Well, I think that the text says that we're asking for, if your claim involves the conduct of a person in furtherance of the person's right to petition or free speech in connection with a public issue. [00:32:00] Speaker 04: And I think every time California courts have addressed this language, [00:32:05] Speaker 04: They've been very clear that we're talking about the defendant's speech in connection with a public issue. [00:32:10] Speaker 03: My parents saying this issue has never come up in the California court. [00:32:14] Speaker 04: Not so far as I can tell. [00:32:15] Speaker 00: But isn't Neocortex arguing that their distribution of this image is, in fact, their speech? [00:32:22] Speaker 04: And I don't disagree that they are making that argument that some of the things they are doing are speech acts. [00:32:30] Speaker 04: But the speech in connection with a public issue is the user's. [00:32:34] Speaker 04: And that, I think, is the key. [00:32:35] Speaker 03: Well, so there, I mean, I understand your public issue argument, but everybody seems to agree that what's being attacked here is this watermarked image. [00:32:46] Speaker 03: Right? [00:32:46] Speaker 03: It's a form of commercial speech by them, is it not? [00:32:49] Speaker 03: You're saying it's an advertisement. [00:32:51] Speaker 04: Well, I'm saying that that is commercial speech. [00:32:54] Speaker 04: And I think that is the conduct that is in furtherance of the speech in connection with the public issue. [00:32:58] Speaker 03: OK, so now, I don't understand why that alone doesn't make its speech within the, forget the exceptions and the exemptions, but doesn't that alone make its speech within at least the initial scope of the inquiry? [00:33:13] Speaker 04: I think that it doesn't. [00:33:15] Speaker 04: There is conduct and furtherance of speech on a public issue, but it's not the defendant's speech on a public issue or in connection with a public issue. [00:33:21] Speaker 03: But you're attacking, as I understand it, their publication of this image with a watermark on it and your client's body, but not his head. [00:33:33] Speaker 03: Isn't that them speaking? [00:33:36] Speaker 04: Yes. [00:33:36] Speaker 04: And I think that is their speech, their conduct. [00:33:40] Speaker 03: Now, I understand your argument that that doesn't fit within the exemptions or exceptions. [00:33:47] Speaker 04: But you agree that's speech, do you not? [00:33:48] Speaker 04: Yes. [00:33:49] Speaker 04: Well, I agree that it is a speech act. [00:33:51] Speaker 04: We can evaluate the First Amendment defenses erased. [00:33:55] Speaker 03: And if there were no exceptions or exemptions, then this would be covered by the Anti-SLAP Act, would it not? [00:34:01] Speaker 04: I would disagree, because I think as they've presented it, the public participation here is what the users are doing. [00:34:08] Speaker 04: And our lawsuit doesn't have anything to do with what the users are doing. [00:34:11] Speaker 04: It's what the defendant is doing to solicit downloads of the app. [00:34:15] Speaker 04: And so I think that pulls it out of the scope here. [00:34:18] Speaker 04: But again, I think there are any number of ways to affirm this judgment on the merits if you're not inclined to hold it for a year or two years. [00:34:27] Speaker 03: Any of the number of things we've discussed so far. [00:34:28] Speaker 03: My problem is that these cases deal with our jurisdiction. [00:34:32] Speaker 03: And put aside the district court's jurisdiction to consider, that's a separate issue. [00:34:37] Speaker 03: But the cases deal, at least in part, with whether we have appellate jurisdiction to review the denial of this motion. [00:34:45] Speaker 02: But I'm wondering, too, whether it's one thing if we're denying it, saying it doesn't apply, versus affirming it, but saying it does apply and this appeal is properly here. [00:35:03] Speaker 02: Anyway, I'm just wondering. [00:35:05] Speaker 04: That's a fed court's question, and it's been about 12 years, so. [00:35:08] Speaker 02: Yeah, well, we live with it. [00:35:09] Speaker 04: And thank you for that. [00:35:12] Speaker 04: And I'll yield the remainder of my time. [00:35:13] Speaker 02: OK, thank you. [00:35:15] Speaker 02: Mr. Newby? [00:35:16] Speaker 01: Thank you. [00:35:19] Speaker 01: I just want to address the question the panel's raised about, does my client need to be a licensee for it to be able to assert copyright preemption? [00:35:27] Speaker 01: And I think the answer is no. [00:35:29] Speaker 01: The question in copyright preemption is, [00:35:33] Speaker 01: is the right that's being asserted, or is the act that's being challenged in the complaint, A, within the subject matter of copyright, and then B, if it is, is the right equivalent to one protected by copyright. [00:35:49] Speaker 01: It's true that in most of the cases, if not all of the cases, where this has come up in the anti-SLAP context and the right of publicity, the defendant has been [00:36:00] Speaker 01: a licensee or has been the creator itself. [00:36:05] Speaker 01: In the case of Lawz, it was Sony Music who licensed a song, or actually was the licensee of a song that was sampled. [00:36:14] Speaker 01: It was not the complete song, but it was sampled in the resulting work. [00:36:18] Speaker 03: Does the record tell us what your client's interest is? [00:36:21] Speaker 03: in the clips, put aside the watermarked image. [00:36:26] Speaker 01: It doesn't, but it's not relevant. [00:36:28] Speaker 03: Well, I understand your argument, it's not relevant. [00:36:31] Speaker 03: Maybe the records would solve the issue for me if you could tell me where it was. [00:36:35] Speaker 01: No, and that's why it doesn't, but our position is that you don't need more factual development on that because it's not relevant to the preemption analysis. [00:36:45] Speaker 01: It could be later some copyright owner comes after my client says you're infringing our copyrights. [00:36:50] Speaker 03: That's my next question. [00:36:51] Speaker 03: So let's assume you'd stolen these clips from somebody and then use them to do exactly what you're using them now for. [00:36:58] Speaker 03: You still could assert a copyright preemption defense. [00:37:03] Speaker 01: Well, if we were being, so if we were being sued for copyright infringement, that's obviously- No, no, not this case. [00:37:10] Speaker 03: I mean, in this case. [00:37:11] Speaker 01: Right, but if we were, then no, we couldn't argue preemption because the copyright- No, but I'm thinking about this case. [00:37:17] Speaker 03: You stole them from somebody, they're not yours, you've got no claim to ownership of them, no claim to right to use them. [00:37:25] Speaker 03: The owner doesn't care because, what the hell? [00:37:28] Speaker 03: I don't want to have a lawsuit. [00:37:30] Speaker 03: These guys make exactly the same complaint they're making now. [00:37:34] Speaker 03: I take it your position is you would be entitled to assert a copyright preemption defense to their publicity claim. [00:37:41] Speaker 01: Yes, preemption applies nonetheless. [00:37:44] Speaker 01: I see my time is up. [00:37:46] Speaker 01: Thank you. [00:37:46] Speaker 02: Thank you, counsel. [00:37:49] Speaker 02: Young, the neocortex is submitted, and this session of the court is adjourned for today. [00:37:55] Speaker 02: Thank you. [00:37:57] Speaker 02: All rise. [00:38:10] Speaker 02: This court for this session stands adjourned.