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Second Circuit: Copyright license of indeterminate term improperly read to be perpetual

By McKee, Voorhees & Sease, P.L.C.

In this appeal from the United States District Court for the Northern District of New York, the Second Circuit reversed the dismissal of a copyright claim based on ambiguity in a contract, but affirmed dismissal of the antitrust claims because the plaintiff's proposed market definition was not plausible.

The district court dismissed the copyright claims based on a contract granting the defendants the right to copy the plaintiff's materials with no time limit.  The district court held this was unambiguous, and granted a perpetual license to the defendants.  The Second Circuit held the contract ambiguous, in part because under New York law "contracts which are vague as to their duration generally will not be construed to provide for perpetual performance."  As a result, the court remanded the case for the district court to determine the duration of the license granted by determining the parties' intent.

The Second Circuit agreed with the district court that the plaintiff defined the relevant market in an implausible manner, and affirmed the dismissal of the antitrust claims.  The plaintiff's proposed market definition did not encompass all interchangeable substitute products, even under the facts in the light most favorable to the plaintiff, and therefore dismissal was proper.

More detail of Chapman v. New York State Div. for Youth after the jump.

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Full post as published by FileWrapper on November 07, 2008 (boomark / email).