ITAR-TASS RUSSIAN NEWS AGENCY; ITAR-TASS USA, AND FROMER & ASSOCIATES, INC., Plaintiffs-Counter-Defendants- Appellees, ARGUMENTY I FAKTY; MOSKOWSKIE NOVOSTI KOMSOMOL-SKAYA PRAVDA; UNION OF JOURNALISTS OF RUSSIA; EKHO PLANETY; MEGAPOLIS EXPRESS; BALAGAN ISRAELI COMIC MAGAZINE; MOSKOWSKY KOMSOMOLETS; AR PUBLISHING CO., INC. AND YEVGEN I. FROMER, Plaintiffs- Appellees, v. RUSSIAN KURIER, INC., Defendant-Counter- Claimant-Appellant, OLEG POGREBNOY, Defendant-Appellant. Docket No. 97-7498 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT 153 F.3d 82; 1998 U.S. App. LEXIS 21016; 47 U.S.P.Q.2D (BNA) 1810; Copy. L. Rep. (CCH) P27,813; 26 Media L. Rep. 2217 December 17, 1997, Argued August 27, 1998, Decided PRIOR HISTORY: Julian Lowenfeld, New York, N.Y., for [**1] Appeal from the March 24, 1997, remaining appellees. judgment of the United States District Court for the Southern District of New York (John (Professor William F. Patry, Yeshiva G. Koeltl, Judge) granting an injunction and University, Benjamin N. Cardozo School of awarding damages for copyright Law, New York, N.Y., submitted a brief as infringement. amicus curiae, by appointment of the Court). DISPOSITION: Affirmed in part, reversed in part, and JUDGES: remanded for further proceedings. Before: FEINBERG, NEWMAN, * and McLAUGHLIN, Circuit Judges. COUNSEL: Joel K. Bohmart, Bohmart & Sacks, New * Judge Calabresi was originally a York, N.Y., for appellants. member of the panel, but recused himself after oral argument. Robert J. Berman, Hackensack, N.J., for Thereafter, Judge Newman was appellee Fromer and Associates. assigned to the panel and has heard the audiotapes of the oral argument. OPINION: [*84] JON O. NEWMAN, Circuit Judge: the newspaper employers who compile their This appeal primarily presents issues writings. We further conclude that to the concerning the choice of law in international extent that Russian law accords newspaper copyright cases and the substantive publishers an interest distinct from the meaning of Russian copyright law as to [**2] copyright of the newspaper reporters, the the respective rights of newspaper reporters publishers' interest, like the usual ownership and newspaper publishers. The conflicts interest in a compilation, extends to the issue is which country's law applies to issues publishers' original selection and of copyright ownership and to issues of arrangement of the articles, and does not infringement. The primary substantive issue entitle the publishers to damages for copying under Russian copyright law is whether a the texts of articles contained in a newspaper publishing company has an newspaper compilation. We therefore interest sufficient to give it standing to sue reverse the judgment to the extent that it for copying the text of individual articles granted the newspapers relief for copying appearing in its newspapers, or whether the texts of the articles. However, because complaint about such copying may be made one non-newspaper plaintiff-appellee is only by the reporters who authored the entitled to some injunctive relief and articles. Defendants-appellants Russian damages and other plaintiffs-appellees may Kurier, Inc. ("Kurier") and Oleg Pogrebnoy be entitled to some, perhaps considerable, (collectively "the Kurier defendants") appeal relief, we also remand for further from the March 25, 1997, judgment of the consideration of this lawsuit. District Court for the Southern District of New York (John G. Koeltl, Judge) enjoining Background them from copying articles that have appeared or will appear in publications of the The [**4] lawsuit concerns Kurier, a Russian plaintiffs-appellees, mainly Russian language weekly newspaper with a newspapers and a Russian news agency, circulation in the New York area of about and awarding the appellees substantial 20,000. It is published in New York City by damages for copyright infringement. defendant Kurier. Defendant Pogrebnoy is On the conflicts issue, we conclude that, president and sole shareholder of Kurier and with respect to the Russian plaintiffs, editor-in-chief of Kurier. The plaintiffs include Russian law determines the ownership and corporations that publish, daily or weekly, essential nature of the copyrights alleged to major Russian language newspapers in have been infringed and that United [**3] Russia and Russian language magazines in States law determines whether those Russia or Israel; Itar-Tass Russian News copyrights have been infringed in the United Agency ("Itar-Tass"), formerly known as the States and, if so, what remedies are Telegraph Agency of the Soviet Union available. We also conclude that Russian (TASS), a wire service and news gathering law, which explicitly excludes newspapers company centered in Moscow, functioning from a work-for-hire doctrine, vests exclusive similarly to the Associated Press; and the ownership interests in newspaper articles in Union of Journalists of Russia ("UJR"), the the journalists who wrote the articles, not in professional writers union of accredited print -2- and broadcast journalists of the Russian Federation. Since the Court's analysis framed the key The Kurier defendants do not dispute that issue that would be considered at trial and is Kurier has copied about 500 articles that first raised on appeal, the Court's opinion and the appeared in the plaintiffs' publications or Russian statutory provisions relied on need were distributed by Itar-Tass. The copied to be explained. material, though extensive, was a small percentage of the total number of articles Preliminarily, the Court ruled that the published in Kurier. See Itar-Tass Russian request for a preliminary injunction News Agency v. Russian Kurier, Inc., 1997 concerned articles published after March 13, U.S. Dist. LEXIS 2717, [**5] No. 95 Civ. 1995, the date that Russia acceded to the 2144(JGK), 1997 WL 109481, at *13 Berne Convention. See id. at 1125. The (S.D.N.Y. Mar. 10, 1997) ("Itar-Tass II"). The Court then ruled that the copied works were Kurier defendants also do not dispute how "Berne Convention works," 17 U.S.C. ' 101, the copying occurred: articles from the [*85] and that the plaintiffs' rights were to be plaintiffs' publications, sometimes containing determined according to Russian copyright headlines, pictures, bylines, and graphics, in law. See Itar-Tass I, 886 F. Supp. at 1125- addition to text, were cut out, pasted on 26. layout sheets, and sent to Kurier's printer for The Court noted that under Russian photographic reproduction and printing in the copyright law authors of newspaper articles pages of Kurier. retain the copyright in their articles unless Most significantly, the Kurier defendants there has been a contractual assignment to also do not dispute that, with one exception, their employer or some specific provision of they had not obtained permission from any law provides that the author's rights vest in of the plaintiffs to copy the articles that the employer. [**7] See id. at 1127. Since appeared in Kurier. Pogrebnoy claimed at the defendants alleged no claim of a trial to have received permission from the contractual assignment, the Court next publisher of one newspaper, but his claim considered the provision of the 1993 was rejected by the District Court at trial. Russian Federation Law on Copyright and See id. at *4. Pogrebnoy also claimed that Neighboring Rights ("Russian Copyright he had obtained permission from the authors Law") (World Intellectual Property of six of the copied articles. The District Organization (WIPO) translation) concerning Court made no finding as to whether this what the United States Copyrights Act calls testimony was credible, since authors' "works made for hire," 17 U.S.C. ' 201(b). permission was not pertinent to the District See Russian Copyright Law, Art. 14(2). That Court's view of the legal issues. provision gives employers the exclusive right Preliminary injunction ruling. After a to "exploit" the "service-related work" hearing in May 1995, the District Court produced by employees in the scope of their issued a preliminary [**6] injunction, employment, absent some contractual prohibiting the Kurier defendants from arrangement. However, the Court noted, copying the "works" of four plaintiff news Article 14(4) specifies that subsection 2 does organizations. See Itar-Tass Russian News not apply to various categories of works, Agency v. Russian Kurier Inc., 886 F. Supp. including newspapers. See Itar-Tass I, 886 1120, 1131 (S.D.N.Y. 1995) ("Itar-Tass I"). F. Supp. at 1127. Accepting the view of -3- plaintiffs' expert, Professor Vratislav and Other Works." This Article contains two Pechota, Judge Koeltl therefore ruled that sub-sections. Article 11(1) specifies the the Russian version of the work-for-hire rights of compilers generally: doctrine in Article 14(2), though exempting The author of a collection or any other newspapers, applies to press agencies, like composite work (compiler) shall enjoy Itar-Tass. See id. copyright in the selection or arrangement of Turning to the rights of the newspapers, subject matter that he has made insofar as Judge Koeltl relied on Article 11, captioned that selection or arrangement is the result of "Copyright of [**8] Compiler of Collections a creative effort of compilation. evidence at the trial, the last phrase of The compiler shall enjoy copyright Article 11(2) was rendered "independently subject to respect for the rights of the from the publication as a whole." Russian authors of each work included in the Copyright Law, Art. 11(2) (Newton Davis composite work. translation). Because the parties' experts Each of the authors of the works included focused on the phrase "as a whole" in the in the composite work shall have the right to Davis translation of Article 11(2), we will rely exploit his own work independently of the on the Davis translation for the rendering of composite work unless the author's contract this key phrase of Article 11(2), but all other provides otherwise. references to the Russian Copyright Law will .... be to the WIPO translation. Russian Copyright Law, Art.