Legislating IP (formerly the Induce Act Blog)

The only Copyright Treatise your library needs

2007-01-24T20:35:00.000-05:00

In single space, printed form, the The Patry Copyright Treatise is, by almost 100%, the largest treatise on copyright published, and is the first new multi-volume treatise on U.S. copyright law in 17 years.

***

also started today a separate blog, The Patry Treatise Blog. The purpose of this new blog is to start breaking down the one-way nature of treatise writing: I want to provide a forum where people can react to the book and I can both respond and provide further thoughts on things I have written or am thinking about putting in the next supplement.

What will the midterm elections mean for copyright?

2006-11-08T17:04:00.000-05:00

The Patry Copyright Blog: What the Election May Mean for Copyright: "On the House side, there is no uncertainty as to the majority, but we may not know for awhile who becomes chair of the IP subcommittee. Two names are mentioned frequently, Rick Boucher of Virginia, and Howard Berman of California. Both have a great deal of experience with copyright, and are highly regarded by their peers."

President Signs Copyright Royalty Judges Program Technical Corrections Act

2006-10-13T16:56:00.000-05:00

President Signs H.R. 1036, the Copyright Royalty Judges Program Technical Corrections Act

On October 6, 2006, the President signed into law the Copyright Royalty Judges Program Technical Corrections Act (P.L. 109-303). Among other provisions, the Act provides:
that the Copyright Royalty Judges are subject to the Administrative Procedure Act;
that they must consider certain Copyright Arbitration Royalty Panel determinations and interpretations among precedents;

that they allow certain petitioners to participate in a proceeding without a filing fee;

that they may make a partial distribution of cable and satellite royalty fees after the filing of claims for distribution of such fees; and

that they may issue an amendment to a written determination concerning technical and clerical errors and to modify terms under certain conditions.

Trademark Dilution Act Signed into Law

2006-10-11T12:21:00.000-05:00

The Trademark Dilution Act was signed into law last week. The bill overturns the Supreme Court's requirement from Moseley v. V. Secret Catalogue, Inc. that in order to prevail on a trademark dilution claim, the plaintiff must establish the existence of actual dilution, not simply the likelihood of dilution.

Eric Goldman, Trademark Dilution Revision Act of 2006: "Ostensibly, this law was intended to overturn the Moseley case's requirement that plaintiffs show 'actual dilution' instead of a 'likelihood of dilution.' However, the act morphed into an omnibus dilution revision effort that reshapes dilution law on a number of fronts. The result is a mixed bag--there is a little good news mixed in with the bad."

Attorney(s) at Kaye Scholer: The Trademark Dilution Revision Act of 2006: A Major Overhaul of Federal Trademark Dilution Law: "On October 6, 2006, the President signed the Trademark Dilution Revision Act ("TDRA"), a significant revision of federal trademark law intended to clarify and amend the scope of protection afforded to "famous" marks under Section 43(c) of the Lanham Act, 15 U.S.C. §1125(c). While it addresses and resolves a number of issues that have arisen since the introduction of dilution protection to federal law in 1995, the TDRA, nonetheless, has the potential to create numerous other issues, thereby making it likely that dilution will remain a controversial and evolving aspect of trademark law for many years to come."

William McGeveran, Info/Law, Trademark Dilution Revision Act Becomes Law: "The dilution concept has long been criticized for separating a trademark claim from its conceptual moorings: in theory, the principal interest protected by trademark law has been to prevent consumers from being confused. But that theory has been highly attenuated for a long time, so maybe it is better to admit that trademark law now protects big companies’ brand names for their own sake."

Previously: Chris Cohen shared some detailed first impressions of the bill.

Looking back, looking ahead

2006-10-10T15:16:00.000-05:00

The Patry Copyright Blog: The 109th Congress

The first session of most Congresses is usually devoted to oversight hearings and gathering information. There are a number of areas that could use serious attention in the 110th Congress. I mention two: First, the secondary liability issues left unresolved by the Supreme Court in Grokster. The Court is dysfunctional, issuing 9-0 opinions, as in eBay and Grokster, which are undercut substantially by dueling groups of concurring opinions, leaving litigants, lower courts, and the rest of us trying to figure out what's next. It is well past time for Congress to assert itself, and to permit the public to join the debate in open hearings and the give and take of the democratic process, rather than having to suffer from the Court's own internal politics.

Clean Flicks discussion in the House

2006-10-05T11:33:00.000-05:00

Last week, the House Committee on Energy and Commerce Subcommittee on Commerce, Trade, and Consumer Protection held hearings on Editing Hollywood’s Editors: Cleaning Flicks for Families.

Mr. Bill Aho, Chief Executive Officer, ClearPlay Inc.

Mr. Allan L. Erb, President, CleanFlicks Media, Inc.

Mr. John Feehery, Executive Vice President, External Affairs, Motion Picture Association of America

Ms. Robin Bronk Executive Director, The Creative Coalition

Mr. Jason Schultz, Staff Attorney, Electronic Frontier Foundation

This summer, a federal district judge ruled that creating and distributing edited versions of films to "sanitize" the films to make them more "family-friendly" constitutes copyright infringement as a matter of law under the §106(1) right of reproduction and 106(3) right of distribution. Clean Flicks of Colorado v. Soderbergh, 02-cv-01662-RPM (D. Colo. 7/6/06).

Previously: Clean Flicks.

Google adds news archives

2006-09-06T07:59:00.000-05:00

Google announced today that it has "added the ability to search through more than 200 years of historical newspaper archives alongside the latest contemporary information."

As with its current News service, Google will merely index the content and will not handle content delivery. They will also not charge content owners or consumers for the service.

Some of the content Google will be indexing has entered the public domain, but there is still plenty of content that is still under copyright. Google has announced agreements with The New York Times and Time Magazine to provide archived content for the service, but will also include articles "indexed from the Web without formal arrangements with their publishers".

If you recall, that practice prompted a lawsuit from the Angence France-Presse, alleged that the headline presented with the photo and excerpt constituted the "heart of the matter" and was thus an infringing use. While I can certainly appreciate the merits of AFP's argument, I do still agree with Prof. Patry's analysis that this constitutes Fair Use.

(Cross-posted to Loosely Coupled)

FairUse4WM cracks Microsoft's PlaysForSure DRM

2006-08-28T20:18:00.000-05:00

The big news last week was that the Windows Media DRM was cracked. Derek also thinks this isn't entirely a bad thing, and in fact this benefits both the consumers and the online music services. As Grant puts it, "DRM doesn't protect content in any meaningful way. DRM does however present an encumbrance to legal uses of media purchased by legitimate customers." This is, ultimately, the paradox of DRM: it keeps the 'good guys' from using works that would fall under fair use, but doesn't protect against the "bad guys" determined to steal anyways.

Peter Rojas, in an open letter to Microsoft, implores the company not to kill the FairUse4WM project. Rather than being an incentive for people to steal music, he suggests that many friends and readers have actually expressed an interest in signing up for these services. I tend to agree with this assessment. Until iTunes offers a subscription plan, this means that nearly nearly 80% of all digital music players are excluded from subscription service. If I were able to play Yahoo! Music or Napster music on my iPod, I would undoubtedly subscribe, and I'm sure many others are in the same situation.

As Peter puts it, "what keeps them paying is the continuing access to a large, frequently updated catalog of new releases and older tunes", and "DRM makes paying for music less attractive than stealing."

People aren't just downloading music illegally because it's free - they're downloading it because they can't get what they want from a paid service. Simply put, DRM doesn't work.

(Cross-posted to Loosely Coupled)

Net Neutrality Update

2006-08-27T10:59:00.000-05:00

FTC Chairman Deborah Majoras announced she will organize an Internet Access Task Force to examine a variety of issues, including Net Neutrality. Her speech here: pdf. [via PK]

The new dilution bill

2006-05-03T19:37:00.000-05:00

Steve Yahn at Editor and Publisher tries to stir up some interest in what should be -- search-term advertising and other flavors of the month aside -- the trademark story of the moment:

Embedded deep in H.R. 683, "The Trademark Dilution Revision Act," which awaits what may well be a last look in the U.S. House of Representatives before being signed into law by President Bush, is language that would remove key free-speech protections that have been part of U.S. trademark law since 1996.

Read the whole thing. He's right on: This bill will make the Lanham Act about as self- executing for plaintiffs as you could hope, at least for "famous marks." Be very scared if you're not the owner of such a mark... or its retained counsel.

UPDATE: Reaction at Editor & Publisher.

Originally posted on Likelihood of Confusion.

Legislating Decency

2006-01-23T00:09:00.000-05:00

It is not IP per se, but IP attorneys and students may be interested in First Amendment and telecommunications issues. I have a series of podcasts covering Senate Commerce Committee hearings about regulating broadcast decency posted at IPTAblog: IPTelligentsia Podcast: Senate Indecency Hearings Part 1 and Part 2.

Grokster remand hearing set for May 1st

2006-01-12T08:55:00.000-05:00

SVMLB: "Grokster remand hearing set for May 1st"

Senate to get techy next year

2005-11-30T23:32:00.000-05:00

Internet News reports that the Senate Commerce Committee will hold a number of hearings on internet and communications issues early next year: Senate Sets Ambitious Tech Schedule: "Signaling its intent to focus on Internet and telecom issues next year, the U.S. Senate Commerce Committee plans to hold 14 hearings on a wide variety of technology topics between January and March."

I'll try to cover these as much as possible. Maybe it's time to consider finding a sponsorship to underwrite complete coverage…

Committe on Commerce, Science & Transportation upcoming hearings:

1/19 - Decency
1/19 - Internet Pornography
1/24 - Broadcast and Audio Flag
1/31 - Broadcast and Audio Flag
2/7 - Net Neutrality
2/14 - State and Local Issues and Municipal Networks
3/2 - Wireless issues/spectrum reform
3/14 - Voice over Internet Protocol (VoIP)
3/14 - Wall Street's Perspective on Telecommunications

Previously: Fair Use in the Internet Age, Broadcast Flag and the Analog Hole, Protecting Copyright and Innovation in a Post-Grokster World.

Fair Use in the Internet Age

2005-11-16T23:07:00.000-05:00

The House Committee on Energy and Commerce Subcommittee on Commerce, Trade and Consumer Protection held hearings today on Fair Use: its Effects on Consumers and Industry.

Mr. Peter Jaszi
Professor
Washington College of Law
American University

Mr. Gary Shapiro
President & Chief Executive Officer
Consumer Electronics Association
Arlington, VA

Ms. Prudence S. Adler
Associate Executive Director
Federal Relations and Information Policy
Association of Research Libraries
Washington, DC,
On behalf of: The Library Copyright Alliance

Mr. Jonathan Band PLLC
Washington, DC,
On behalf of: NetCoalition

Ms. Gigi B. Sohn
President & Founder
Public Knowledge
Washington, DC

Mr. James V. DeLong
Senior Fellow & Director
IPCentral.Info Progress & Freedom Foundation
Washington, DC

Mr. Frederic Hirsch
Senior Vice President, Intellectual Property Enforcement
Entertainment Software Association
Washington, DC

Mr. Paul Aiken
Executive Director
Authors Guild, Inc.
New York, NY

An archived webcast and witness and member statements are available here.

Much of the hearing focused on discussing the merits of HR 1201, The Digital Media Consumers' Rights Act of 2005. HR 1201 would create a fair use exemption to the DMCA prohibition on circumventing digital rights protections schemes (aka DRM). In addition, the bill would authorize the FTC to require manufacturers and retailers to label copy protected CD's.

Most of the witnesses who addressed the panel spoke in favor of this bill and in defense of the fair use right. Jaszi discussed the tradition of fair use within the Copyright Act and noted a number of policy arguments in favor of the fair use rights, particularly the fact that fair use prevents copyright from overwhelming the First Amendment. As the reach of copyright law is constantly expanding to provide more restrictions on uses than ever before, fair use matters.

Shapiro started off discussing how fair use ensures innovation. Without fair use, there would be no VCR, tape recorder, Tivo, or iPod. The information technology industry relies on fair use-- fair use is all that protects inventors from an over-protected world. Because every use of digital content requires making a copy, fair use is especially important and needs to be strengthened. Americans should be able to use their property in any way they choose that does not harm others.

Band also noted that all actions in the digital world require making copies, including viewing web sites and replying to emails. Search engines depend on fair use in order to exist. Each major search engine copies a large portion of the world wide web every month under and opt-out scheme of implied consent. Kelly v. Arriba Soft found that search engine indexing is fair use and limiting this use would hurt the way we find information on the internet.

Adler discussed the relevance of fair use to the mission of libraries. Fair use works well because it is flexible, dynamic and inherently ambiguous. In addition to fair use by library patrons, librarians rely on fair use to create print and electronic reserves and to digitize print works. But when acquiring databases and electronic resources for collections, libraries license, rather than acquire like print material. License agreements are more restrictive than the scope of rights under fair use. Once technological controls are built-in to software, it is impossible for libraries to negotiate exceptions in license agreements.

Adler concluded by stressing the importance of libraries, who, rather tan publishers, archive copies for future uses. Fair use is an important safeguard on our nation's interest in cultural information.

Sohn discussed how fair use rights are slowly being chipped away. Although consumers expect to use content when, how and where they want, the content industries have managed to restrict these uses in the name of preventing piracy. Under the current anti-circumvention law, it is illegal for an individual to copy songs from a copy-protected CD for personal use, shifting video from a DVD to view on an iPod, or removing malicious DRM "rootkit" software from a computer. Sohn asked the representatives to "reject the notion that your constituents are pirates and theives. They do purchase digital products when those digital products are avilable on the market." In addition, she encouraged the representatives to reform the DMCA so that it permits circumvention solely for lawful purposes and clarify and strengthen the DMCA triennial review process.

Public Knowledge thinks that DRM is fine, so long as it is marketplace driven, not driven by legislation. FairPlay works in the marketplace, while Sony's didn't. The government should not mandate technological protection measures. DeLong agreed with applying a marketplace test to technology. But then, DeLong thinks a marketplace will sort out all problems with the copyright economy.

DeLong testified, "We don't talk about the need to balance the interests of automobile manufacturesr and drivers. We assume that we can establish rules promoting markets and allowing the market to sort itself out." Fair uses usually exist when the transaction cost of getting permission is out of proportion to all value to the user and detriment to the creator.
The internet is taking transaction costs out of the system.

DeLong credited DRM with creating marketplace solutions to things that used to have a cost. On the other hand, DRM imposes a cost on performing actions that the law has traditionally considered to be fair uses-- uses either so important to the free spread of ideas or so trivial that the law is not concerned with imposing a cost. These are actions that have no monetary value, yet are to be part of a marketplace? Fair use and free use are not necessarily the same.

Aiken and Hirsch, not surprisingly, spoke against strengthening the scope of fair use.

In both his opening statement and questioning of the witnesses, Stearns focused on seeking a technological solution for the "fair use problem." He thinks that technology should be able to come up with a magic bullet that would absolve Congress of its role in having to make difficult decisions about what activities should be encouraged and which activities prohibited. Stearns asked, "Why not make this the copyright equivalent of a race to the moon? Why shouldn't we be able to technologically limit the number of copies?"

Impressionistic transcripts of the most interesting questions asked by the subcommittee follow in the extended entry at iptablog (blogger has no extended entry feature.)

Broadcast Flag and the Analog Hole

2005-11-01T21:47:00.000-05:00

On Thursday afternoon, the House Subcommittee on Courts, the Internet, and Intellectual Property will hold an Oversight Hearing on "Content Protection in the Digital Age: The Broadcast Flag, High-Definition Radio, and the Analog Hole." with Dan Glickman (Chairman and Chief Executive Officer, Motion Picture Association of America (MPAA)), Mitch Bainwol (Chairman and Chief Executive Officer, Recording Industry Association of America (RIAA)), Gigi B. Sohn (President, Public Knowledge), Michael D. Petricone (Vice President, Government Affairs, Consumer Electronics Association (CEA) on behalf of CEA and the Home Recording Rights Coalition.)

At this hearing, the MPAA will present a two draft bills:

The Broadcast Flag Act would amend Title 47 of the US Code to grant the FCC the authority to regulate digital television receivers to enable a broadcast flag. Broadcast flag regulations adopted by the FCC were struck down by the DC Circuit in American Library Assoc. v. FCC for a lack of a legislative grant of authority.

The Analog Content Act would amend Title 35 to require certain analog conversion devices to preserve digital content security measures. In other words, this legislation would require technology and consumer electronics developers to only sell hardware that conforms to rules set by copyright owners to restrict the storage and redistribution of analog audio and video content.

The draft is written in such straightforward language:

§101(a)(1) No person shall manufacture, import, offer to the public, provide or otherwise traffic in any – analog video input device that converts into digital form an analog video signal that is received in a covered format, or an analog video signal in a covered format that is read from a recording on an inserted storage medium, unless any portions of such device that are designed to access, record or pass the content of the analog video signal within that device: (i) detect and respond to the rights signaling system with respect to a particular work by conforming the copying and redistributing of such work to the information contained in the rights signaling system for such work in accordance with the compliance rules set forth in section 201 and the robustness rules referred to in section 202; and (ii) pass through or properly reinsert and update the CGMS-A portion of the rights signaling system or coding and data pertaining to CGMS-A and pass through the VEIL portion of the rights signaling system in conformance with such compliance rules and robustness rules;

CGMS-A carries information about the rights a copyright owner is willing to grant to viewers alongside closed caption information. VEIL carries rights information as patterns encoded within the video signal itself (like Macrovision copy protection on VHS and DVD.)

This bill would require the Patent & Trademark Office to regulate the "rights signaling system" and in any rulemaking to update the rights signaling system, should encourage "representatives of the film industry, the broadcast, cable and satellite industry, the information technology industry, and the consumer electronics industry."

Joe Gratz wonders why this bill would place regulatory authority within the PTO rather than the Copyright Office: Analog Hole News: "Could this be because this law enacts unlimited-term copyrights for certain uses of certain content, violating the constitution’s “limited times” requirement? Or perhaps it’s because it covers “live events” as well as copyrighted works, violating the constitution’s “writings” requirement."

The EFF's Danny Sullivan writes:

The unprotected analog outputs of computers will be, in perpetuity, restricted to either DRM-laden standards, or to a "constrained image", "no more than 350,000 pixels". Analog video which has been branded as "do not copy", will last for only ninety minutes only in the digital world - and will be erased, literally frame by frame, megabyte by megabyte, from your PC, without your control. You'll watch a two hour film, and as you watch the final half hour, the first few scenes will be being dissolved away by statute.

The EFF's Cory Doctorow writes: Hollywood after the Anal. Hole again: "This is like the Broadcast Flag on steroids. The Broadcast Flag only covered TV receivers. This covers everything with an analog video input. If this had been around in 1976, the VCR would have been illegal. Today, it would ban Mythtv, every tuner-card in the market, and boxes like ElGato's eyeTV the Slingbox and the Orb and the vPod. This is a proposal to turn huge classes of technology into something that exists only at the sufferance of the studios."

Pre-release product photos

2005-10-24T18:19:00.000-05:00

Joe Gratz looks at one aspect of the Copyright Office implementation of regulations under the ART Act: Post Pre-Release Product Photos On Your Blog, Get Sued For Copyright Infringement:

The Copyright Office today released its interim regulations implementing the pre-registration provisions of the ART Act. Under that law, those who distribute pre-release copies of a work intended for later commercial distribution can be sued for copyright infringement even if the copyright holder has not yet finished or registered the copyrighted work, so long as the copyright holder "pre-registered" the work.

Vehicle Hulls

2005-10-18T12:04:00.000-05:00

Senator Cornyn (R-TX) introduced a bill to clarify one element of the Digital Millenium Copyright Act-- Title V, the Vessel Hull Design Protection Act. This bill is the Vessel Hull Design Protection Amendments of 2005 Act as S. 1785.

This bill will amend chapter 13 of the Copyright Act, which protects the design of vessel hulls to clarify the distinction between a hull and a deck, in order "to provide factors for the determination of the protectability of a revised design, to provide guidance for assessments of substantial similarity, and for other purposes."

Under the current version of the statute, the deck is considered part of a ship's hull, at least as far as copyright protection for the design of the vessel. The revised version of the statute would still protect the deck as part of the hull design, but also define a deck to be the part of a ship that sits upon the hull and includes the exterior cabin and cockpit surfaces.

Here is what §1301 will appear after the modifications proposed by this bill:

§ 1301. Designs protected
(a) Designs Protected.—
(1) In general.— The designer or other owner of an original design of a useful article which makes the article attractive or distinctive in appearance to the purchasing or using public may secure the protection provided by this chapter upon complying with and subject to this chapter.
~~(2) Vessel hulls.— The design of a vessel hull, including a plug or mold, is subject to protection under this chapter, notwithstanding section 1302 (4).~~
(2) VESSEL FEATURES- The design of a vessel hull or deck, including a plug or mold, is subject to protection under this chapter, notwithstanding section 1302(4).

(b) Definitions.— For the purpose of this chapter, the following terms have the following meanings:
(1) A design is “original” if it is the result of the designer’s creative endeavor that provides a distinguishable variation over prior work pertaining to similar articles which is more than merely trivial and has not been copied from another source.
(2) A “useful article” is a ~~vessel hull, including a plug or mold~~ vessel hull or deck, including a plug or mold, which in normal use has an intrinsic utilitarian function that is not merely to portray the appearance of the article or to convey information. An article which normally is part of a useful article shall be deemed to be a useful article.
(3) A “vessel” is a craft—
(A) that is designed and capable of independently steering a course on or through water through its own means of propulsion; and
(B) that is designed and capable of carrying and transporting one or more passengers.

~~(4) A “hull” is the frame or body of a vessel, including the deck of a vessel, exclusive of masts, sails, yards, and rigging.~~
(4) A "hull" is the exterior frame or body of a vessel, exclusive of the deck, superstructure, masts, sails, yards, rigging, hardware, fixtures, and other attachments.
(5) A “plug” means a device or model used to make a mold for the purpose of exact duplication, regardless of whether the device or model has an intrinsic utilitarian function that is not only to portray the appearance of the product or to convey information.
(6) A “mold” means a matrix or form in which a substance for material is used, regardless of whether the matrix or form has an intrinsic utilitarian function that is not only to portray the appearance of the product or to convey information.
(7) A "deck" is the horizontal surface of a vessel that covers the hull, including exterior cabin and cockpit surfaces, and exclusive of masts, sails, yards, rigging, hardware, fixtures, and other attachments.

Protecting Copyright and Innovation in a Post-Grokster World

2005-09-30T17:36:00.000-05:00

On Wednesday, the full Senate Judiciary Committee held hearings on "Protecting Copyright and Innovation in a Post-Grokster World," with testimony from:

The Honorable Mary Beth Peters, U.S. Register of Copyrights, Copyright Office, Washington, D.C.
The Honorable Debra Wong Yang , U.S. Attorney for the Central District of California , and Chair of the Attorney General’s Advisory Committee , on Cyber/Intellectual Property Subcommittee , Los Angeles, CA
Marty Roe, Lead Singer, Diamond Rio, Nashville, TN
Cary Sherman, President, Recording Industry Association of America, Washington, D.C.
Gary Shapiro, President and Chief Executive Officer, Consumer Electronics Association, Arlington, VA
Mark Lemley, William H. Neukom Professor of Law, Stanford University Law School, and Director, Stanford Program in Law, Science and Technology, Stanford, CA
Ali Aydar, Chief Operating Officer, SNOCAP, San Francisco, CA
Sam Yagan, President, MetaMachine, Inc. (developer of eDonkey and Overnet), New York, New York

In an opening statement, Senator Cornyn (R-TX) framed the issue in terms of protecting IP assets: "this hearing focuses on the importance of protecting property rights.… Unfortunately, every day, literally millions of dollars in copyrighted works are stolen via online services." The witnesses discussed more specific and concrete issues affecting copyright law after Grokster.

Before Grokster

Sherman discussed figures concerning the decline of the music industry in terms of both unit shipments and revenue since 1999, noting the correlation with the rise of file sharing, although he did not address a causal link between P2P file sharing and the decline. Yagan discussed figures showing that the number of P2P users continues to increase. This year alone, the average number of P2P users online at any given time has grown by more than 41% to nearly ten million. In the last 5 years, the number of active P2P users has increased fivefold. At its peak, classic Napster had 2 million users simultaneously online, according to Aydar.

Aydar offered three main lessons from the first five years of the P2P era:

Consumers were ready for digital music long before the recording industry was ready or even able to provide it.
It wasn’t about free, it was about having every song or symphony or speech you ever heard, no matter how exotic or obscure, at your fingertips. It was about being able to hear that music however and wherever you wanted: at your computer, in your car, on your stereo, at the beach -- an unlimited jukebox to satisfy everyone’s musical tastes that couldn’t be fulfilled through traditional retail channels.
Music has a tremendous meaning in many people’s lives.

Aydar went on to offer one reason for this continued growth in P2P: "While consumers were clearly ready to obtain their music digitally, the recording industry and music publishers were not yet ready to embrace the digital channel. Despite Napster’s best efforts to transition to an authorized business model, the company was forced to file for bankruptcy after nearly two years of litigation. From its ashes sprang hundreds of new P2Ps, designed specifically to skirt the law that was established in the Napster case.… Fans are stuck between the limited selection of today’s authorized services, and the poor user experience offered by the unauthorized P2Ps – adware, spyware, viruses, spoofed files, pornography… not to mention the fact that copyrights are not respected and users risk being sued. "

Impact of Grokster

While some parties, including the Register of Copyrights and the representatives of the content industries, are pleased that the Grokster decision brought clarity to the question of whether the developers of P2P file sharing software can be held liable for inducing infringement on a massive scale, technology developers fear that the Court's inducement standard is vague and nebulous and may lead to an unnecessary chill on innovation. "

The immediate impact of the decision is a renewed interest in licensing content for sharing on P2P networks. Register of Copyrights Marybeth Peters testified, "By articulating some boundaries on the development of products used to infringe copyrights, the Grokster ruling may have helped to frame these negotiations and agreements. Presumably some actors who felt that the prior state of law gave them complete freedom to offer products designed to facilitate infringement - and to do so with impunity – are now having second thoughts in light of the fact that the Court has clarified that there is a basis for holding them accountable for the consequences of what they purvey."

The main problem faced by P2P services hoping to become legitimate is the need to obtain licenses from numerous copyright owners. Peters said, "If the legitimate music industry continues to be saddled with a time-consuming and transactionally-expensive licensing process, then it can never compete effectively with the “pirates” who can offer a wider variety of music faster and cheaper." Aydar concurred, "Today, there are literally hundreds of thousands of living copyright owners. Each on-line retailer would have to strike an enormous number of direct deals to match the number of tracks the existing P2Ps provide -- a legal, economic, and practical impossibility."

The market is developing intermediaries to license content. SNOCAP COO Ali Aydar described his company's service as facilitating this marketplace. SNOCAP provides a way for rightsholders to claim, tag and control their content on P2P networks. Aydar believed that this will enable "a robust market that offers consumers more music through more channels" and notes that SNOCAP can act as a neutral registry for digital content in all media, including video and text.

In contrast, Gary Shapiro (Consumer Electronics Association) and Yagan suggested that the Grokster ruling will affect the ability of technology companies to innovate and result in a chilling effect on technology development in the US. Shapiro testified, "The old adage is that hard cases make bad law, and Grokster was a hard case." Shapiro worries that the Grokster decision will limit the ways that individuals will be able to transform and use content for personal purposes and that the technology industry will not be able to innovate.

If a single court were now to label as “infringement” consumers’ home recording of content they have paid to view or hear, what will be the status of all the product design, research, development, production, marketing, and distribution activity that went into serving these consumers? Scores of products and services are being created and introduced that change how people buy a house, book travel, do research, complete their education, and even run for office. The technologies have improved access to information, education and entertainment and enhanced peoples’ lives. All digital technologies involve copying to some degree. The law should not impede or restrict these new and beneficial consumer activities or the digital technology products that make them possible. Yet, all of these commonplace activities implicate conduct – reproduction, distribution, derivative works – that an overbroad interpretation of the Grokster case could prohibit. We are at a crossroads in technology. With new technologies allowing every citizen to be a creator, we must accept that our national creativity can no longer be measured by CD sales.

Many technology companies, including eDonkey, whose products can be used for infringement will simply find themselves unable to continue operations in a Post-Grokster world -- not necessarily because they would lose under the new Grokster standard, but rather because they literally cannot afford the costs of mounting a legal defense.

A broad inducement standard may chill innovation. Lemly noted that "since the courts have interpreted copyright law not to have any corporate veil, someone who runs or simply works for such a company could lose their house and their family’s retirement fund. The threat of a lawsuit will deter not just innovators developing technologies with illegal uses, but those who develop technologies with both legal and illegal uses and those who don’t yet know how the market will use their technology. The list of such dual-use technologies is long and distinguished: broadband Internet service, the iPod, TiVo, CD burners, and computers themselves, to name just a few."

In addition to chilling technological innovation in the US, the active inducement standard may send technology development overseas. Yagan noted that seven of the top ten major P2P software companies have chosen to locate outside of the U.S. and that Skype, the "hottest technology company of the moment" was founded outside of the U.S.

Questions remaining after Grokster

Most parties agreed that it is too early for Congress to legislate the inducement standard, but that we need time to see how the standard is applied by the lower courts. Lemly testified, "Whether the Court succeeded in creating a middle ground remains to be seen. Much will depend on how the Court’s open-ended, multi-factor test for improper purpose is interpreted in the lower courts. Much will also depend on how far copyright owners seek to take the new doctrine, and whether they overreach. For this reason, it is premature to propose legislation to correct deficiencies in the new inducement test."

Lemly suggested that 3 questions need to be answered about the Grokster standard:

What is required to prove "improper purpose?"
What conduct is required?
What state of mind must exist regarding infringement?

Yagan offered a hypothetical to explore the bounds of the active inducement test: "If eDonkey had simply written on its website from day one, 'eDonkey is a P2P file-sharing client' would we know for sure that we had avoided 'affirmatively and actively' inducing infringement? If so, then these sites will spring up immediately; if not, then the effect of Grokster will go beyond chilling, perhaps to the point of freezing innovation in its tracks."

Yagan went on to offer a framework for following the developments around P2P. P2P development may follow the trend towards greater anonymity, secrecy and adoption of encryption, or it may be the P2P services that pick up momentum are the "corporate, profit-motivated enterprises, which likely will be forced to comply with contractual terms stipulated by major entertainment rights aggregators such as reverting to centralized indexed searches, implementing various types of filtering, operating closed networks, and offering conventional industry-sanctioned business models like the current centralized paid download stores and tethered subscription models."

Impact of recent legislation

US Attorney Debra Wong Yang discussed the impact that recent legislation has had on criminal enforcement of copyright law and preventing piracy. The Digital Millenium Copyright Act has enabled prosecuting the intermediaries who remove copyright protection from content before distributing it to warez groups on the internet or on physical media. The Family Entertainment and Copyright Act (FECA) has made it possible for prosecutors to target the pirates at the step of acquiring source material, such as in movie theaters. Last month, Department of Justice prosecutors in San Jose, California used certain FECA provisions for the first time to charge a Missouri man with felony crimes for camcording films in movie theaters and distributing the films on computer networks.

What to do next?

General Goals
Lemly discussed the need to evaluate the public impact of copyright reform. While the copyright industries have the most at stake in reforming copyright laws, the public has an stake, too.

While reducing copyright infringement is an important goal, it cannot and should not be the only goal of public policy. Congress should also be concerned that overzealous enforcement of copyright will create a hostile environment for technological innovation and entrepreneurial business models. It should strive to balance these important interests, providing effective copyright protection but also preserving an environment in which innovation can thrive.

Nor can Congress simply rely on assurances from the copyright industry that they will foster innovation themselves, or target only "bad" and not "good" innovations. The content industry has proven short-sighted, time and again trying to stifle technologies that ultimately proved beneficial not only to society but even to copyright owners. They tried – and fortunately failed – to shut down jukeboxes, radio, cable television, the VCR, and the mp3 player. Perhaps it should not surprise us that publicly traded companies should have a short-run focus, looking at this quarter’s bottom line and not what will benefit society in the long run.

Copyright maximalism is poor public policy, and creating an environment where copyright maximalists create the laws will result in a legal regime that serves copyright owners to the detriment of the general public.

Yagan offered three suggestions for ways to legislate

Clarify the Supreme Court’s ruling in Grokster.
Make sure that the legislation will have the practical consequences you desire. Decentralization and anonymity facility infringement rather than accountability.
Encourage a market solution. Tens of millions of consumers are thirsting for the content created and distributed by the major labels and studios – there will be – there must be – numerous business models that will generate immense profits from these individuals.

Lemly suggested three issues that are the most deserving of legislative attention:

Make it easier for copyright owners to target direct infringers; Use the Copyright Royalty Judges Congress created last year to administer a quick, simple and cheap system for identifying and punishing high-volume illegal file traders.
Make it easier to clear rights in the digital environment.
Insulate technology companies from unreasonable liability.

Compulsory License Reform
Peters testified that Grokster clarified the issue of inducement liability sufficently to supplant the need for new legislation: "The Grokster decision supplants the need for Congress to create inducement liability by statute." Instead of inducement liability, Peters thikns that Congress should be focusing on making it easier to license works and reform the §115 compulsory license.

Grokster failed to resolve the difficulties of licensing underlying musical works for legal digital redistribution, which is the main hurdle facing innovation in the legitimate digital distribution of music. Section 115 is an antiuqated provision and needs to be reformed. The statutory rate puts an unnecessary ceiling on the royalty rate for privately negotiated licenses and hurts the free market. The one-at-a-time structure for licensing individual musical works makes it difficult, if not impossible, for online music services to acquire the right to make available vast mumbers of already recorded phonorecords. Many onine services bridge the gap between public performance and reproduction/distribution. By having different methods for clearing the public performance right and the mechanical rights, the statutory license is an unnecessary impediment to legitimate, innovative online music services. Reform is needed to make it possible to clear quickly and efficiently the necessary exclusive rights for large numbers of works.

By reforming the law for licensing works, Congress can make it easier for developers to create digital services that can compete with P2P on the open marketplace without having to engage in costly and pointless negotiations with scores of copyright owners.

(Also posted at iptablog)

Future of Music

2005-09-12T09:55:00.000-05:00

I'm blogging live from the Future of Music Policy Summit over at iptablog.

Universal Declaration of American Rights

2005-09-05T19:56:00.000-05:00

Derek Slater of the EFF's Deep Links blog is unhappy -- hat tip to Donna Wentwirth -- about "general search warrants" being issued in India to bring the file-sharing crusade to those ruddy-golden shores:

These kinds of warrants are ripe for abuse. That's why they're prohibited in this country under the Fourth Amendment, which was prompted by British abuses of power during colonial times. The MPA has the right to go after those suspected of infringment all around the globe, but it should be ashamed of using tactics that ignore basic civil liberties.

Really? From what I read, since a few years ago India has been a sovereign country with its own laws and constitution, and a democracy as well. For some reason, in its wisdom India decided not to replicate the U.S. Constitution. It's astonishing to me that anyone would suggest that anyone with a legal beef in India should unilaterally adhere to abstract principles of "basic civil liberties," or those enshrined in the constitutions of other countries, as part of its legal strategy. It's also quite a dollop of legal ethnocentrism.

It's really not as complicated as all that, however. Slater simply doesn't like the plaintiff in these cases -- the Motion Pictures Association -- nor its litigation goals. That's what is called "outcome-based" legal argumentation -- I don't like the result so I'll cook up a new pseudo-principle of law to get me an better one. I hope you'll excuse me for assuming that no one is about to suggest, in adherence to this new international legal principle, that "the defendants in the Indian MPA litigation should volunteer to comply with the voluntary disclosure rules of Federal Rule of Civil Procedure 26(e), which was enacted because Congress and the Supreme Court believed there was excessive gamesmanship in the discovery process."

But Ron, there's a difference between the Federal Rules of Civil Procedure and the Fourth Amendment, for heaven's sake!

Not in India there isn't!

Now, there's plenty of real issues to argue about, and I tend to agree that the MPA is going about this all wrong. But fuzzy-headed simulations of legal or constitutional arguments are not going to win the day with anyone.

Chief Justice Rehnquist Dies at Home - Yahoo! News

2005-09-03T22:22:00.000-05:00

Chief Justice Rehnquist Dies at Home - Yahoo! News

Hard Drive Data Recovery for Hurricane Victims

2005-09-01T20:55:00.000-05:00

My friend Jack Moore of Eagle Eye Forensics, LLC sent this along. It's not free, but if you know someone who has to worry about this, you may want to send it along.

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* Even if you are not ready for recovery of your data, contact us ASAP for instructions about how to prevent permanent destruction of the data on your hard drives.

We want to help you recover as easily and as soon as possible.

Our prayers remain with you and yours.

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Eagle Eye Forensics, LLC
Digital forensic services for the legal community
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www.eeforensics.com

Jack adds, "Tell people that if the drives are under water, keep them wet under water, clean water if possible."

Update on ClearPlay

2005-08-19T15:36:00.000-05:00

I stumbled on this article in Slate and it seemed to contradict my point in one of my favorite posts. On reflection I realized that actually the two pieces actually harmonize quite well.

It did make me wonder whatever happened in the ClearPlay litigation. As the company's site describes it,

ClearPlay has developed a unique DVD parental control technology that enables users to skip and mute segments of movies that contain graphic violence, nudity, and profanity.

The seven major Hollywood movie studios, along with fifteen prominent film directors and the Directors Guild of America have joined their collective resources to sue ClearPlay in an attempt to strip American families from their right to use ClearPlay enhanced parental controls within the privacy of their homes.

Oddly enough, the timeline of the court case on that site ends in 2004. But judging from the firm's selection of news stories on another page of its website, the company evidently anticipated that the Family Entertainment and Copyright Act may have made the litigation irrelevant.

Not that ClearPlay doesn't have other problems -- like a patent suit that's scaring off some partners. While it's one thing to edit the sludge that oozes out of Hollywood, editing your own press releases and website -- which make no mention of the progress of either the copyright litigation or the patent claims -- seem like less of a great idea in the long run.

So we did a little research on PACER. Turns out that the patent litigation is going full-bore, pay- for- your- lawyers'- kids'- braces,- college- and- medical- school- tuition patent litigation in the Southern District of Florida -- so much so that not only the ClearPlay website but the Nissim website fall far short of even alluding to the whole story. (See the extended entry on my blog for the docket report -- it doesn't format so great but you'll get the point down toward the bottom, if you like this sort of thing.) Nissim is represented by my old friend (from a case we worked on together -- not that he'd remember) Steven Pokotilow; I don't know the ClearPlay lawyers.

And the copyright litigation? Turns out it was dismissed for want of subject matter jurisdiction in light of the new legislation just two days ago, the court declining to issue an advisory opinion (essentially what ClearPlay was requesting), as federal courts are wont to do. Looks like ClearPlay was hoping for a little icing on its copyright cake, and maybe some attorneys' fees thrown in, in the copyright litigation (in the U.S. District of Colorado) considering what looks like a shellacking it seems to be receiving in the Florida patent case. But that was not to be.

As for me, I support their project, separate and apart from the legal issues -- the copyright issue now being moot (and my heart does not bleed for copyright owners here!), and the patent issue looking like a bloody mess. And it's not all bad for ClearPlay in the patent department. As long as the legal fees don't destroy the viability of the business, ClearPlay could be a company to watch.

Darknet for all within months?

2005-08-10T22:38:00.000-05:00

Can lawsuits or a new push for legislation be a fix for an easy to use anonymous Darknet file-sharing program? I think it will take more than Grokster or the Induce Act to deal with this...

Software that will allow people to anonymously swap music and other files on the Internet could render copyrighting of songs and movies obsolete by year's end, a creator [of Freenet] said. A test version of the "darknet" software was made available on a Freenet Project website early Wednesday and a refined edition could soon be ready "for general consumption," Ian Clarke of Freenet told AFP. The software is intended to allow computer users worldwide to exchange files online in a way that hides them from industry investigators, vindictive politicians and others, Clarke said. Music recording industry goliaths have fought to crush such renegade file sharing, which they claim fosters piracy of copyrighted material by musicians. Darknet software has so far been treated as a tolerable bane by copyright defenders because programs have been difficult to use and limited to sharing between groups of no more than five or 10 computer users. "We've devised a way you can have a darknet with potentially millions of users," Clarke said. "We hope we will have something suitable for launch this side of Christmas."

And another thing...why are people/news articles still saying things like this: "Music recording industry goliaths have fought to crush such renegade file sharing, which they claim fosters piracy of copyrighted material by musicians." Is there still really a debate about whether file sharing fosters copyright infringement? Maybe I'm missing something. There have been questions about the extent to which widespread file sharing has hurt industry profits and to what extent file sharing benefits society as opposed to how badly it damages the music & film industries, but not about whether file sharing fosters piracy. That much seems pretty clear. Let's be a little more intellectually honest people, please.

Stealth online use by Christmas: software designers - Yahoo! News

Likelihood of Confusion by Ron Coleman: Good News: I Saved a Lot of Money on Litigation

2005-08-09T09:17:00.000-05:00

Looking for the Geico v. Google decision? Here it is.

UPDATE: I didn't exactly mean more litigation -- but I guess we shouldn't be surprised.