Book review: "Moral Panics and the Copyright Wars" by William Patry

The content and technology businesses are at war, as is well-known and as I discuss in a recent article. It’s a struggle that focuses on unauthorized file sharing and new business models—in other words, a copyright war. Undeniably, the entertainment industry often battles demand rather than trying to satisfy it, and copyright laws have taken a corporate turn. Who better to write about this conflict, one would think—and point the way to solutions, one would hope—than an author with 27 years experience in copyright law as a professor, practitioner and government attorney?

That author is William Patry, who is now Google’s senior copyright counsel (though he emphasizes that he’s writing to express his own views, not Google’s). He says he’s in favor of “effective” copyright statutes, and I opened his book hoping to learn what those might look like, since the divergence of public behavior and existing copyright laws makes it clear that something has to change. It’s an area of great interest to me, not just personally, but also professionally, as my law practice at TroyGould focuses in large part on new media and, more generally, the intersection of entertainment and technology. I was writing a review for the Los Angeles Times, and I hoped I’d be able to write a positive one.

Alas, not. What I found was a book riddled with invective, unoriginal observations, and numerous typographical errors—about 200 typos at my count, including twice referring to Martin Luther King’s most famous oratory as the “I Had a Dream” speech (as though King had simply given up) and inadvertently transmuting federal judge Richard Posner into “Judge Richard,” perhaps positioning him for a gig on syndicated television.

The text is heavily footnoted, yet still marred by unsupported claims. Thus, Patry says that imposing public-access easements on beachfront houses doesn’t reduce their value. That’s doubtful, and he offers no evidence. We’re told “orphan works” is a metaphor used to unjustifiably protect certain kinds of works, but actually those using the term want to loosen protection (a position I agree with, as does Patry). Patry claims that declining CD sales are not related to unauthorized file sharing, but offers neither discussion nor footnotes. Moreover, the book is larded with unnecessary block quotes, among them a half-page endnote analyzing the phrase “Tastes Like Chicken.” Whatever the entrée, a sharper carving knife would have helped.

In short, I was hoping for a significant contribution that would build on previous work in this oft-discussed field. Instead, I found a deeply flawed narrative that didn’t even acknowledge the existence of landmark books in the area by such authors as Lawrence Lessig, Neil Netanel, William W. Fisher III, Jessica Litman, Siva Vaidhyanathan, Tarleton Gillespie, and James Boyle. As I discuss in the LA Times piece, the book is not without some virtues, but I was largely disappointed and surprised. You can read the full review here, then come back and leave comments if you wish.

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Culture Clash on the Internet

The Internet has devalued content to the point where it is often offered at no charge—newspapers, for instance—or widely misappropriated, as with music and movies. Either way, many people expect much of their content to be free. Why is this, how did it happen, and, focusing on music and movies, what can be done about it?

I’ve previously written about the why, in Huffington Post and Vanderbilt Journal of Entertainment and Technology Law articles, and identified six factors. Let’s focus on two: the culture of piracy, and the rise of ad-supported business models. Underlying both is the belief that content on the Internet should be free (a notion reinforced by the other four factors).

How did this attitude arise? The answer lies in the origin of the Internet. At first glance, this is paradoxical: the Internet began in the late 1960’s as the ARPANET, a project of the Department of Defense Advanced Research Projects Agency, or ARPA. The DoD, of course, seldom fosters self-gratification, a trait that underlies the “free content” culture of the Internet.

However, take a second look. The ARPANET was developed not in-house by ARPA, but primarily by defense contractors orbiting Harvard, MIT and Stanford, and by universities. Their faculty and staff used the ARPANET for social purposes as well as research, for instance by setting up news groups encompassing a variety of recreational interests. No one charged for participation in those groups, or anything else on the ARPANET, and there was little regulation of content—or of file transfers via the network. Those files were primarily documents, data and software, since digitized music and video were effectively non-existent. Still, the precedent was set: file sharing was virtually unfettered.

The predominance of researchers on the ARPANET fostered an academic ethos that includes the concept that information, i.e., content, should be free, since only by openly sharing research can science and other disciplines advance. As the ARPANET grew, the DoD installations on the network were split off in 1983 into a separate MILNET, leaving the ARPANET as primarily an academic facility. The transformation to a free-oriented environment was complete. Significantly, though, the network was primarily used by students and faculty in the computer science field. Its evolution towards the Internet occurred with little public notice until the early 1990’s. By then, its norms were set.

At the same time, an “information should be free” movement was growing, initially focused mainly on the software arena rather than networking. This coincided with the rise of personal computers, and was a reaction to the concurrent rise of consumer software, which of course was generally offered for sale, not for free. As the movement grew to encompass other forms of content, it reinforced and made latent the norms that had developed on the ARPANET.

In contrast to these trends, pre-Internet commercial timesharing systems were being deployed in the late 1970’s and early 1980’s, offering consumers email, information and entertainment, but on a paid basis, as befits a commercial offering. Thus, these systems had different cultural norms than the ARPANET—different histories, expectations, rules and practices. Ultimately, though, these systems were overshadowed by—and their commercially grounded norms had little effect on—the Internet.

During the same period, copyright law began to have meaning for the public in a digital context, but at first only for the limited population who traded in pirated software and games. Prior to this time, the only infringement committed by significant segments of the public involved physical media: mix tapes, concert bootlegs, and album copies on cassette made for friends. Although relatively common among young people, these forms of music (let alone any form of video) weren’t distributed digitally, because personal computers and networks at the time couldn’t process the large files involved. Thus, creation and distribution of these analog tapes was a time-consuming, manual process that didn’t imperil the music industry.

That began to change with the availability of the compressed MP3 audio format in 1995. The format exploded in popularity in 1997 with the release of the free, computer-based Winamp player software and even more so in 1998, with the introduction of the Rio portable MP3 player, a forerunner of today’s iPod. Accelerating these trends, modems were becoming faster, personal computers more powerful, and the Internet more pervasive. People began to rip CDs—that is, copy them to personal computers in MP3 format—and share the MP3 files over the Internet. (Ripping was possible because the audio CD standard, developed in 1980, omits copy protection, perhaps due to a failure to anticipate the capabilities that developed 25 years later.)

The above history, cultural trends, and technical factors appear to be what led to widespread copying and distribution of music and, later, motion pictures. Although educational campaigns have informed and reminded the public that such conduct is infringement, the underlying norms have proved difficult to dislodge, an effect that scholars refer to generally as the “sticky norms” problem. Thus, many people continue to violate the law.

But why? Or, to turn the question on its head, why do people ever obey laws (criminal or civil), even when it may be in their self-interest not to do so? This question has been studied by scholars such as Prof. Tom Tyler of NYU, who lays out several reasons that researchers have examined: (a) people consider the “tangible, immediate incentives and penalties . . . [i.e.,] personal gains and losses” resulting from obeying or disobeying a law (alternatively, the certainty, swiftness and severity of punishment); (b) people decide whether a particular law is moral (i.e., just); and (c) they decide whether a law is legitimate (i.e., promulgated by an authority that has the right to do so).

Evaluated against these metrics, copyright law as applied to content on the Internet falls woefully short. The immediate incentives to infringe copyright are clear: free music and movies. The penalties, in contrast, though severe, are neither swift nor certain, since only a small percentage of infringers are sued (and usually only uploaders of content, not downloaders). In addition, the prevalence of legitimately free content on the Internet—whether user generated content or ad-supported commercial works such as newspapers—probably undermines the perception of copyright law as just; after all, if some content is free, why not all of it? Finally, the perception that content companies are driving the copyright laws (and, of course the fact that they are filing the lawsuits), and a widespread disdain for music labels in particular, delegitimizes those laws.

Two other factors that drain perceived morality and legitimacy from copyright law are the fact that the targets of demand letters and lawsuits were often young people or their sometimes unknowing parents; and that the damages sought or obtained were sometimes grossly disproportionate to the offense. As scholars have discussed, these factors may have precipitated a backlash that actually decreased rather than increased compliance. In any case, ineffectiveness and negative public perception appear to have put a halt to copyright lawsuits against consumers.

What next? When noncompliance is widespread, sometimes the laws change (as in the elimination of prohibition and of sodomy laws) and sometimes behavior changes, as in the case of drunk driving, which was reduced significantly by a combination of stricter laws and broader education. In the case of copyright, though, the laws are strict already, but neither that nor education have been effective.

Perhaps what’s needed is penalties that are less strict—in the scholarly terminology, “gentle nudges” rather than “hard shoves”—but more widely enforced. If demand letters and infringement lawsuits targeting “first offenders” sought significantly lower damages (assuming litigation costs permit this approach), but such letters and lawsuits were issued much more often, public perception might change. Setting the damages at a level that young people or their parents would find affordable but quite unpleasant could reduce the perception of unfairness, but still have sufficient bite. Coupled with widespread enforcement, such damages might change people’s cost-benefit analysis while avoiding backlash. Something has to be done to reduce misappropriation of music and movies, at least until ad-supported business models (or other alternatives) become sustainable, if they ever do. Maybe this is the way.

This article benefitted from discussion with Prof. John Tehranian of Chapman University.

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Subscribe to my blog (jhandel.com) for more about entertainment law and digital media law. Go to the blog itself to subscribe via RSS or email. Or, follow me on Twitter, friend me on Facebook, or subscribe to my Huffington Post articles. If you work in tech, check out my new book How to Write LOIs and Term Sheets.

Barbara A. Ringer, author of 1976 Copyright Act, 1925-2009

Sometimes an obituary answers a question one never thought to ask. In this case, the question is, who wrote the 1976 Copyright Act? The answer turns out to be Barbara Ringer, who died April 9 at age 83, according to a detailed obituary in the LA Times. And it turns out it took her 21 years (!) of drafting and lobbying to get the law passed.

The significance of Ringer’s accomplishment is this: The 1976 Act was the first comprehensive revision since the 1909 version, which was written in an era that predated audiotape, movies, radio, television, cable TV, and computers. Thus, the changes to the law were momentous. Among many other things, the 1976 Act lengthened the term of copyright, but it also codified the concept of fair use for the first time—a legal doctrine essential to permitting the linking and copying that are essential to the Internet, VCRs, DVRs, and various other technologies.

Also a part of Ringer’s life were the challenges of being a woman in what was at the time almost exclusively a man’s world. When she graduated Columbia Law School and joined the Copyright Office in 1949, most lawyers were not only men, they were heterosexual (or closeted) white men, and the profession was segregated by religion as well (there were “Protestant” law firms and “Jewish” law firms, for instance). Even 22 years later, in 1971, Ringer was passed over for the job of Register of Copyrights—the head of the Copyright Office—and was forced to sue for sex discrimination in order to be awarded the job she would otherwise have gotten.

As for what Ringer did when she retired, well, I could continue to recount the details from the obit. After all, facts aren’t subject to copyright. But I’d rather give the LA Times the traffic. Like most content businesses, newspapers are in a bad way these days, as I discuss in a legal article I’ll soon be posting. So click the link and do your part to help out the local daily.

Trademarking Movie Titles

Book and movie titles fall in a gray area in U.S. law. For instance, although a book or movie is protected by copyright, its title isn't. Copyright simply doesn't cover titles. Officially, trademark doesn't either (except for series titles like Harry Potter). Nonetheless, I've developed ways to protect single-work movie titles using trademark registration -- effectively circumventing the long-established rule. For more, visit http://www.jhandel.com/news/2014/8/13/trademarking-movie-titles.

Viacom Can't Get Punitive Damages in YouTube/Google Suit

Viacom's suit against YouTube and Google slowly works its way through the legal system. In a decision rendered last week, but only generally reported yesterday, the Federal District Court in New York hearing the case denied Viacom's motion to amend its complaint to seek punitive damages against the defendants.

The Court's reasoning: the Copyright law doesn't provide for punitive damages. Thus, the decision says nothing about the strength of Viacom's case, or the thorny issue of whether the DMCA safe harbor - the notice and takedown procedures that govern one-off infringements on websites - applies in the case of the massive infringement alleged in this suit.

Punitive damages are damages intended to punish particularly conduct by defendants that's particularly egregious, as Viacom alleges is the case here. If available, they would come in addition to actual damages (the plaintiff's actual losses) or statutory damages, which are an alternative to actual damages where it's difficult to show actual damages (or where none have occurred).

Online Pirate Faces the Music

A women found guilty of sharing 24 songs, out of 1,700 she had on offer through her Kazaa account, will have to pay $222,000 in damages for copyright infringement to a group of record labels, reports the Los Angeles Times.

That's a jury verdict of $9,250 per song. Under the copyright act, the Minnesota woman, Jammie Thomas, could have been forced to pay as much as $150,000 per infringement. The record labels involved were Arista Records, Capitol Records, Interscope Records, Sony BMG, UMG, and Warner Bros. Records. The RIAA issued a statement hailing the decision. The industry has brought 26,000 lawsuits over the past four years. 10,000 of those cases have settled, typically at less than $5,000 each.

I think the industry's victory will have some deterrent effect, but not enough to sink all the pirate ships a' sail. Ultimately - sooner rather than later - all online music will probably be unprotected MP3's, and price points will probably have to come down as well, for individual songs or for monthly subscriptions.

Movie Clean Plays Dirty Pool, Studios Say

All of the major studios have sued a company that allegedly takes DVDs, modifies or deletes scenes and dialog that it considers objectionable, then sells the edited movies on DVD-Rs, Intellectual Property Litigation Reporter reports. The studios charge that the company, Movie Clean, is infringing their copyrights, and are seeking damages, an injunction, and destruction of the infringing goods.

The studios are clearly in the right, in my opinion, if the allegations are accurate. Creating an edited or revised version of a work - in copyright terminology, creating a derivative work - is one of the exclusive rights of the copyright owner. And taking an entire work, altering it, then selling it as a substitute for the original is scarcely fair use.

UMG Sues Veoh

Universal Music Group is suing Veoh for copyright infringement, based on alleged "massive" copyright infringement by the site's users, Forbes reports. Ironically, one of Veoh's backers is Michael Eisner, former head of CAA and, briefly, CEO of Disney. Veoh counters that it is protected by the DMCA safe harbor rules for internet providers.

Virtual Production - Real Issues

HBO has acquired an animated "documentary" entitled "My Second Life: The Video Diaries of Molotov Alva," that was shot entirely in Second Life, Variety reports. The production legal questions must have been interesting.

For instance: Did the filmmaker get personal releases and location releases? In what form - were hardcopies signed? In whose name - the avatar's or the RL person? If there is later a dispute over the release, what law and jurisdiction apply?

Location releases pose an interesting problem. Buildings in a virtual world are actually just artwork, of course - and artwork is more highly protected under the Copyright Act than physical buildings generally are. The release should be drafted in a way that takes account of this.

Likewise, an incidental image of an avatar may constitute copyright infringement, whereas an incidental shot of a RL person is not copyright infringement, and if it is in a public setting, it is generally not an invasion of privacy either.

Another difficulty is posting notices at virtual locations. How do you post effective notices in a world that allows people to teleport right into a space without ever seeing the posted notice? And how do you post a notice at all if the virtual building won't permit a virtual notice to be taped up onto it?

Bespoke IP

The Fall shopping season has begun. While the rest of us buy clothes, the fashion industry is shopping for new IP protection, reports the NY Times. Fashion designs have very little protection under copyright, but the newly-revised Design Piracy Prohibition Act aims to change that, prohibiting copying of the overall appearance of clothing, handbags, belts and eyeglass frames. This specialized form of copyright would be for a term of three years.

In contrast to the designs themselves, fashion logos and designer names are already protected, by trademark law. In fact, the WSJ recently reported that designer Joseph Abboud can no longer use his own name as a trademark - he sold it. After two years out of the business, he's back, but under a new brand name ("jaz"), and in competition with the owners of his own name.

BTW, the customized form of protection proposed by the Design Piracy Prohibition Act serves as a reminder that there are many forms of IP, each with different (but sometimes overlapping) subject matter. A short list includes:

• Copyrights: Works of authorship, such as books, movies, music, software, art, characters.
• Trademarks: Logos, brand names, slogans, book and movie titles (sometimes), characters.
• Trade Dress: Overall look of a product or service.
• Patents: Inventions, processes, business processes (incl. Internet), software, designs.
• Trade Secrets: Confidential information with economic value
• Moral Rights ("Droit Moral"): Creative rights, such as the right to receive credit (attribution) or not have a work destroyed; limited applicability in U.S.
• Mask Works: Semiconductor chip layouts
• Designs: vessel hulls (boats) and fashion designs (if the proposed bill is enacted)
  

Facebook Faceoff

The dispute over who owns the Facebook IP turns out to be a three-way affair, perhaps like some of the hook-ups on the site itself.

In 2004, the founders of of a site called ConnectU sued Facebook, alleging copyright infringement and theft of trade secrets. The ConnectU founders - Harvard students at the time - claim that they conceived the idea of a collegiate social networking site, and asked another student, Mark Zuckerberg, to write the source code.

Zuckerberg, the suit alleges, began to write code, but then jumped ship and used the code - and the idea - to start what is now Facebook. ConnectU foundered, while Facebook prospered.

Today, the NY Times reports, another Harvard student - Aaron Greenberg - has appeared, with emails between himself and Zuckerberg that allegedly prove he created an on-line facebook before Zuckerberg/Facebook or ConnectU. Greenberg says Zuckerberg lifted his ideas. He's bitter, but he's not suing. (At least, not yet.)

Who's on top in this three-way tussle? Allegedly, there was no contract between ConnectU and Zuckerberg, and Zuckerberg was not a formal employee of ConnectU. If true, ConnectU may find its suit disconnected, because without a contract or an employment relationship, trade secrets are generally not protectible and the programmer owns the copyright.

Likewise, Greenberg apparently has no legal claim, because his ideas weren't secret - his system was public - and because he doesn't claim anyone stole his code.

The lesson for ConnectU: get it in writing. Without a Non-Disclosure and Invention Assignment Agreement, the other guy gets the girl (or guy) while you stay home alone playing video games. The lesson for Greenberg: first doesn't always win. And the lesson for the rest of us? See a lawyer before you start bringing in partners and collaborators. Class dismissed.

Viacom, YouTube, and a NC Local Politician ...

... those are the ingredients in a bizarre copyright dispute that reads like a law school exam question.

Apparently, the politician prepared a humorous campaign video, and uploaded it to YouTube. VH1 then apparently downloaded the video from YouTube without permission and (re)broadcast it on the VH1 Web Junk 2.0 program, with the program's host appearing in the foreground adding commentary.

The candidate, pleased with the exposure, made a copy of the Web Junk clip, and uploaded that to YouTube. And, in response Viacom ordered YouTube to take down the video!

Now, remember, Viacom is already suing YouTube/Google for massive copyright violation related to all the uploading of clips from Comedy Central, VH1 and other Viacom properties.

So - no surprise - YouTube took down the clip - and even warned the politician that he'd lose his YouTube account if he continued to violate copyrights!

Was the politician was in fact infringing Viacom's copyright? It seems ridiculous, but there's an argument that he was. After all, Viacom owns the copyright in the Web Junk program, the host's commentary, etc.

What's more, Viacom's use was transformative - they added commentary - whereas the politician's wasn't. He just posted the clip unaltered. That makes a difference in copyright law; advantage Viacom.

But come on - this sure looks like fair use to me. Speech about government and politics is one of the most highly protected areas of the first amendment. By posting the clip, the politician was engaged in politicking - advancing his career. And, don't forget, most of the clip was his content anyway.

But if you want to finish this little law school exam, there's more: in the clip, the politician at one point shows a Star Wars-type Death Star destroying a little red school house. (The pol is a local school board member.) So, were Lucasfilm's copyright and trademark rights violated? Let's not even go there. Back in the Reagan days, there were plans for a missile defense system that everyone called Star Wars. Lucas sued over that, but lost.

And who shot the video anyway? If it wasn't the pol, he may not even own all rights to his own video - the production company might, depending on the terms of the agreement between them, or if there even was an agreement. Even if the production co. and the politician have a proper written agreement, the videographer might own the rights, if he/she was a freelancer and had not signed a written agreement with the production company.

Lawyers call this "chain of title" - the links in the chain of ownership from one person or entity to another. Non-lawyers may call it a nightmare, but for lawyers, well, it's just plain fun. Read more.