Ethics Week 4


Read: §2.1, 2.2 of Baase on privacy
Read http://cs.luc.edu/pld/ethics/garfinkel_RFID.pdf on privacy


Arguments about copying
DRM
Copyright rules details
History
Fair Use
cases
DMCA


ACM talk

Intellectual Property Law in the Internet Age 

Kelly Kocinski, Attorney

Who owns your content on Facebook, Twitter, YouTube, LinkedIn?

How do you protect your work from being stolen? What protections do you have if you are working to develop content that someone else has provided? This lecture and Q & A is aimed at addressing these and other online issues and offering advice on how to protect what  you have created for yourself and others and placed online or otherwise out in the world. 

Kelly will discuss the state of copyright, trademark, and patent law, how the law is trying to catch up to the technological and content-based advancements of the online world, and common misconceptions about the laws as they exist today. She will also discuss how those working online  — whether on social media sites, blogs, or web development — and with technology in general can protect their content and insulate themselves from liability. Finally, there will be a group discussion and Q&A to specifically address the concerns of the audience.


Can the FILM industry survive on the napster model?

Here we get into ECONOMICS. Thirty years ago, the movie industry income from selling recordings was zero, and the industry did fairly well. That said, it seems likely that going back to those days would be impossible.

From 2002 to 2008, the film industry grossed more in DVD sales than at the box office. However, that trend reversed in 2009. It is not clear whether filesharing is a significant factor, or, for that matter, legal on-demand downloads (which are not counted as DVD sales). (TV rights in the past were often as large as box-office; I do not know if that trend has continued but I doubt it.)
Figures in billions:

 box office
 DVD, other sales
 rental (all forms)
2008
 8.99
 10.06
 1.20
2009
 9.87
 8.73
 1.27



Other ethics/economics questions:
Check out http://thepiratebay.org. O brave new world!

Ethical arguments about copying

Baase p 228

  1. I can't afford CDs
  2. Because I can't afford CDs and so would never buy them, Big Music loses nothing when I download instead.
  3. I'm only downloading isolated tracks, not entire CDs
  4. It's ok to take from large, wealthy corporations. (Baase dismisses this. Is there any underlying justification?)
  5. I wouldn't be buying it regardless
  6. I have a right to give gifts (of tracks) to my friends
  7. personal file-sharing is so small as to be inconsequential.
  8. Everyone does it.
  9. I'd be happy to get permission to use zzzz, but don't know where. This is the Eyes on the Prize problem:  http://en.wikipedia.org/wiki/Eyes_on_the_Prize.
  10. I'm posting as a public service
  11. I'm posting to address some important social goal, not for sharing per se. (Legally, this is called transformative use)
  12. This is Fair Use.


Ethics of copyright: is it all about respecting the creator's right to sell their product, that is, is it dependent on the creator's business model?? Isn't this EXTREMELY utilitarian?
 
Bottom line: if we want the old rules to continue, we need to find ways to ensure return on investment for creators of music, movies, and books.
 
If.
 
And such ways to ensure ROI (Return On Investment, a standard B-school acronym) can be legal, technical (eg DRM), or social.

Again, how did we get into a situation where our ethical decision making involved analysis of ROI?

Digital Restrictions Management

(aka Digital Rights Management)

How does DRM fit into the scheme here? Is it a reasonable response, giving legitimate consumers the same level of access they had before? Or is it the case that "only the legitimate customers are punished"?

The general idea behind DRM is to have
  1. encrypted media files, with multiple possible decryption keys
  2. per-file, per-user licenses, which amount to the encrypted decryption key for a given file
  3. player software (the DRM agent) that can use some master decryption to decrypt the per-file decryption key and then decrypt the licensed file. The DRM agent respects the content owner's rights by not allowing the user to save or otherwise do anything with the decrypted stream other than play it.
The last point is the sticky one: the software must act on behalf of the far-away content owner, rather than on behalf of the person who owns the hardware it is running on. Open-source DRM software is pretty much impossible, for example; anyone could go into the source and add code to save the decrypted stream in a DRM-free form. Windows too has problems: anyone cat attach a debugger to the binary DRM software, and with enough patience figure out either what the decryption key actually is, or else insert binary code to allow saving the decrypted stream.

iPods, iPads, kindles, nooks, DVD players, and other closed platforms are best for DRM. Under windows, DRM is one of the issues leading Microsoft towards "secure" Palladium-style OS design under which some processes can never have a debugger attached. ("Protected processes" were introduced into Vista/win7.)

Most DRM platforms allow for retroactive revocation of your license (presumably they will also refund your money). This is creepy. Content providers can do this when your device "phones home", when you attempt to download new content, or as part of mandatory software upgrades.

Note that the music industry, led by iTunes, longer focuses on DRM sales. E-book readers, however, are still plunging ahead. One iPad market-niche theory is that the machine will provide a good platform for DRM-based movies and books.

Some older DRM mechanisms are based on the "phone-home" model: the DRM agent contacts the central licensing office to verify the license. This allows, of course, the licensing office to keep track of what you are watching and when. This raises a significant privacy concern. I have not heard of any recent systems taking this approach.

Another major DRM issue is that different vendors support different platforms. DRM might require you to purchase, and carry around with you, several competing music players, in order to hold your entire music library.

Perhaps the most vexing real-world DRM problem is that licenses are inevitably lost, sooner or later. Keeping track of licenses is hard, and moving licensed content from one iPod to the next (eg to the replacement unit) is nontrivial. If the first iPod is lost or broken, and Apple no longer supports the license, your content is lost. When Wal*Mart switched to selling non-DRM music a year ago, they also dropped support for the DRM music they'd sold in the past, meaning that those owners would see their investment disappear whenever their current hardware platform needed to be replaced.

Traditional CDs have a shelf life of (it is believed) a few decades, and traditional books (at least on acid-free paper) have a shelf life of centuries. Compare these to DRM lifetimes.

See also http://xkcd.com/488.

General copyright law rules

Different categories may be (and usually are) subject to different rules. See http://copyright.gov/title17 for (voluminous) examples.

A local copy is at http://cs.luc.edu/pld/ethics/copyright2007.pdf.
 
Rules for theatrical performances are tricky: these are ephemeral performances! Videotaping a performance may violate actors' rights.  Usual issue is rights of the DIRECTOR.
 
Copyright is held by creator unless:
 
Copyright covers expression, not content. 
Famous case: Feist Publications v Rural Telephone Service:
    (Feist v Rural) (1991, Justice O'Connor)
    the phone book is NOT copyrightable.
(some European countries DO have "database protection". Gaak!!)
More info below
 
Note that if you buy a copy, you have right of private performance (so to speak; there's no special recognition of it), but not public.

First Sale doctrine: after YOU buy a copy, you can re-sell it. Copyright law only governs the "first sale".
 
Who owns the copyright? The creator, unless it is a "work for hire", or the copyright is sold.

Fair Use:
This idea goes back to the constitution: the public has some rights to copyrighted material. Limited right of copying for reviews, etc

Good-faith defense protects schools, libraries, archives, and public broadcasts (but not me and Joel Tenenbaum); this limits statutory damages to $200 IF infringement was "reasonably believed" to be fair use. Note that, in the real world, this strategy doesn't usually apply (though it probably means that schools don't get sued much; it's not worth it.) Section 504(c)(2)(i).

In other cases, statutory damages may be reduced to $200 if the "infringer was not aware and had no reason to believe that his or her acts constituted an infringement of copyright".

Statutory damages are a flat amount you can ask for at trial instead of actual damages. See Section 504. Part of the theory is that by asking for statutory damages, you do not have to prove the number of copies made. But note the effect on the RIAA cases: actual damages might be in the range of $1/track, if you're downloading for personal use, while statutory damages are usually $750/track.
   
Title 17 United States Code, Chapter 5, Section 504, Paragraph (c) Statutory Damages. —

(1) Except as provided by clause (2) of this subsection, the copyright owner may elect, at any time before final judgment is rendered, to recover, instead of actual damages and profits, an award of statutory damages for all infringements involved in the action, with respect to any one work, for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally, in a sum of not less than $750 or more than $30,000 as the court considers just.

This was written to address large-scale commercial copyright infringement. Should it apply to personal use?

Laws (highlights only):

1790 copyright act: protected books and maps, for 17 years. "The earth belongs in usufruct to the living": Thomas Jefferson

1909 copyright act: copy has to be in a form that can be seen and read visually. Even back then this was a problem: piano rolls were the medium of recorded music back then, and a court case established that they were not copyrightable because they were not readable.

1972: Sound recordings were brought under Copyright. But coverage was retroactive, and now lasts until 2067. There are NO recordings in the public domain, unless the copyright holder has placed them there.

1976 & 1980 copyright acts: mostly brings copyright up to date. 1976 act formally introduced the doctrine of Fair Use, previously carved out by court cases, and formally covers television broadcasts.

1988: US signed Berne Convention, an international copyright treaty. We held out until 1988 perhaps because Congress didn't believe in some of its requirements [?]. 1989 Berne Convention Implementation Act: brings US into conformance with Berne convention: most famous for no longer requiring copyright notice on works.

[Berne Convention has since become WIPO: World Intellectual Property Organization, a U.N. subsidiary.

WIPO: one-state-one-vote + north-south divide => rules harming interests of poor countries were blocked. Example: pharmaceutical patents
 
As a result, some international IP agreements are now under the jurisdiction of the WTO (World Trade Organization), which the first-world nations control more tightly.
 
Who has jurisdiction over IP law could be HUGELY important: the third world is generally AGAINST tight IP law, while the first world is generally FOR it (at least governments are)
 
Brief comment on treaty-based law:  A judge may work harder to find a way not to overrule a treaty, than to find a way not to overrule an ordinary law.


1996: Communications Decency Act: not really about copyright, but it will be important to us later.

1997: No Electronic Theft act: David LaMacchia case (above); criminalizes noncommercial copyright infringement if the value exceeds $1000 and the infringement was willful.
 
In 1994, mp3 file sharing had not yet become significant.

1998: Digital Millenium Copyright Act passes. the two best-known and/or most-controversial provisions:
2005: recording movies in a theater is now a felony.

Fair Use

The statute-law rules (emphasis added):
  1. the purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes;
  2. the nature of the copyrighted work;
  3. amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
  4. the effect of the use upon the potential market for or value of the copyrighted work.
Factor 1 relates to how you are using the work, and is not exclusively tied to the commercial/nonprofit issue. It may help, for example, if your use is transformative: transforming the original work into something new and at least partially unrelated. Factor 2 relates to the work itself: is it fiction? Nonfiction? Text? Video? Music? A performance?

PARODIES are also often considered as an Item 1 fair-use exemption, although you should be parodying the work in question and not just using the work in a parody of something else. (Maybe not; see 1964 MAD case below) Here are a few parodies:

Generally the creator of a parody does NOT need permission of the original author.
 
Factor 2 refers to whether the work is nonfiction or fiction, etc. Fundamental news facts (and even sometimes images, eg individual frames from the Zapruder film of the Kennedy assassination) have been ruled "fair use". (The film itself is still under copyright, held now by the Sixth Floor Museum.) Sports scores are still debatable.
 
Factor 3: "one chapter" is probably way over the fair-use boundary. Quoting 400 words from Gerald Ford's biography was ruled not fair use. (However, the 400 words in question were those where Ford explained his pardon of Nixon.)
   
Factor 4: This is the big one. See Sony v Universal.
   

Some Famous Copyright Cases

Wikipedia famous copyright cases:
    http://en.wikipedia.org/wiki/List_of_leading_legal_cases_in_copyright_law.

1964: Irving Berlin et al. v. E.C. Publications, Inc.: "Mad Magazine case"

    Mad Magazine published "sung-to-the-tune-of" alternative lyrics for popular songs.
    District court ruled in MAD's favor on 23 of 25 songs.
    2nd Federal Circuit decided in MAD's favor on all 25 songs.



Sony v Universal City Studios, 1984, mentioned above.

SCOTUS decision: http://www.law.cornell.edu/copyright/cases/464_US_417.htm, by Justice Stevens.

This is the "Betamax" case, to at least some degree about fair use. Universal Studios sued Sony for selling the betamax VCR, on the theory that Sony was thus abetting copyright violation, and profiting from it.

District court found for Sony
Appellate court (9th circuit) found for Universal Studios
Supreme court, 5-4 decision, found for Sony

Paragraph 12 of the Supreme Court decision (emphasis added), addressing the Four Factors of Fairness:

The District Court concluded that noncommercial home use recording of material broadcast over the public airwaves was a fair use of copyrighted works and did not constitute copyright infringement. It emphasized the fact that the material was broadcast free to the public at large, the noncommercial character of the use, and the private character of the activity conducted entirely within the home. Moreover, the court found that the purpose of this use servedthe public interest in increasing access to television programming, an interest that "is consistent with the First Amendment policy of providing the fullest possible access to information through the public airwaves. Even when an entire copyrighted work was recorded, the District Court regarded the copying as fair use "because there is no accompanying reduction in the market for ‘plaintiff’s original work.‘"
   
Is that part about "broadcast free to the public" and the "private character" explicit in the Four Factors?

The Supreme Court decision then went on to introduce the doctrine of Substantial Non-Infringing Uses, still with us today and sometimes abbreviated SNIUs.

This case apparently legalized taping of TV programs for later viewing (but NOT archiving). Universal did not show how it was damaged, which didn't help their case any (presumably they thought it was obvious?). Under the doctrine of SNIU, Substantial Non-Infringing Uses, a distributor cannot be held liable for users' infringement (that is, for contributory infringement) so long as the tool is capable of substantial noninfringing uses. The precise role of "Fair Use" in the court's reasoning is not as clear as it might be, but this certainly DID play a role. It was actually the District Court that made that case.

SCOTUS does NOT really spell out "Fair Use" four-factor analysis, though they hint at it in the section "Unauthorized Time-Shifting" (paragraph 46). It was the District Court that came to the Fair Use conclusion.
  
Paragraph 54: "One may search the Copyright Act in vain for any sign that the elected representatives of the millions of people who watch television every day have made it unlawful to copy a program for later viewing at home"

However, there is also the following very interesting line from the Sony decision, in paragraph 46:

Although every commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright, ...

This is a remarkably strong statement about commercial use! The Supreme Court has backed away from this considerably in later decisions.
  
Fred Rogers testified in favor of Sony
  
Harry Blackmun, Thurgood Marshall, Lewis Powell, and William Rehnquist dissented.


1985, Dowling v United States, 473 U.S. 207

Supreme Court

Paul Dowling ran a bootleg record company, as an Elvis fan. SCOTUS agreed with his claim that what he did was not "theft" in the sense of "interstate transportation of stolen property", or fraud in the sense of "mail fraud". This was an important case in establishing that copyright infringement was legally not the same as theft (or, more specifically, that the illegal copies could not be equated with "stolen property"). However, the distinction was rather technical, addressing only whether a federal law on interstate transport of stolen property could be applied.

From the Supreme Court decision, http://laws.findlaw.com/us/473/207.html

The language of 2314 [the interstate-transportation-of-stolen property act] does not "plainly and unmistakably" cover such conduct. The phonorecords in question were not "stolen, converted or taken by fraud" for purposes of 2314. The section's language clearly contemplates a physical identity between the items unlawfully obtained and those eventually transported, and hence some prior physical taking of the subject goods. Since the statutorily defined property rights of a copyright holder have a character distinct from the possessory interest of the owner of simple "goods, wares, [or] merchandise," interference with copyright does not easily equate with theft, conversion, or fraud. The infringer of a copyright does not assume physical control over the copyright nor wholly deprive its owner of its use. Infringement implicates a more complex set of property interests than does run-of-the-mill theft, conversion, or fraud

It follows that interference with copyright does not easily equate with theft, conversion, or fraud. The Copyright Act even employs a separate term of art to define one who misappropriates a copyright: ... 'Anyone who violates any of the exclusive rights of the copyright owner ... is an infringer of the copyright.'

Dowling's criminal copyright-infringement conviction still stood. Note that Dowling's case clearly met the first item of USC §506(a)(1), namely     
    (A) for purposes of commercial advantage or private financial gain;
This was the standard that the courts ruled did not apply in the David laMacchia case.

1991,  Feist Publications v Rural Telephone Service

Supreme Court
    (Feist v Rural) (1991, Justice O'Connor; decision: http://www.law.cornell.edu/copyright/cases/499_US_340.htm)
    phone book is NOT copyrightable.
Paragraph 8:

This case concerns the interaction of two well-established propositions. The first is that facts are not copyrightable; the other, that compilations of facts generally are.

The decision then goes on to explain this apparent contradiction. First, the essential prerequisite for copyrightability is that the matter be original. Some compilations are original, perhaps in terms of selection criteria or presentation. The phone book displays no such originality. There is more starting at ¶ 22 (subsection B); Article 8 of the Constitution is referenced in ¶ 23. The gist of O'Connor's opinion is that, yes, copyright law does go back to the Constitution, and has to be considered. In ¶ 26, she writes,

But some courts misunderstood the statute. ......

What really matters is not how you register your copyright, but whether your work is original.

In 27, O'Connor directly addresses the Lockians among us: she explicitly refutes the "sweat of the brow" doctrine.

In ¶ 32: "In enacting the Copyright Act of 1976, Congress dropped the reference to “all the writings of an author” and replaced it with the phrase “original works of authorship.”"

¶ 46 states exactly what Feist did. You can do it too.

Bottom line, ¶ 50:
The selection, coordination, and arrangement of Rural's white pages do not satisfy the minimum constitutional standards for copyright protection. As mentioned at the outset, Rural's white pages are entirely typical. ... In preparing its white pages, Rural simply takes the data provided by its subscribers and lists it alphabetically by surname. The end product is a garden-variety white pages directory, devoid of even the slightest trace of creativity.


1991: Basic Books, Inc. v. Kinko's Graphics Corporation
Federal District Court, NY
Just because it's been published in a book does not mean you can use it freely in teaching a course. This was considered relatively obvious; nobody appealed.

1993: Campbell v Acuff-Rose Music, relating to the 2 Live Crew parody of Roy Orbison's Prety Woman.

1999: Estate of Martin Luther King, Jr., Inc. v. CBS, Inc.
MLK's "I have a dream" speech is not in the public domain. The issue was that the speech was delivered in 1963, before the 1989 Berne Convention Implementation Act. The copyright was not registered until AFTER the speech. Technical issue: did giving the speech constitute "general" publication or "limited" publication.

2000: UMG v MP3.com
    Federal District Court, NY
The court implicitly rules that you can't download copies even if you already own a copy, but that might not have been the central issue.

Copyright and traditional music


A quote from http://www.edu-cyberpg.com/Music/musiclaw2.html:

John and Alan Lomax, who also devoted themselves to collecting and preserving traditional folk music, took the controversial step of copyrighting in their own names the songs they collected, as if they had written the songs themselves. They even copyrighted original songs collected from other singers, such as Leadbelly's "Good Night Irene."

The Leadbelly incident occurred under the pre-Berne rules, where first-to-register meant something, even if you were registering the copyright of someone else's work.


  
2006-07 Da Vinci Code case: (actually filed in England, which has different laws): authors Leigh & Baigent of the 1982 book Holy Blood, Holy Grail lost their suit against Dan Brown. They had introduced the theory that Mary Magdalene was the wife of Jesus and that Mary and Jesus have living heirs. This was a major plot element used in Brown's 2003 book The Da Vinci Code. Did Dan Brown violate copyright?

Not if it was a "factual" theory, which is what the judge ended up ruling.

DMCA, 1999

Takedown/putback provisions 
legal support for copy-protection; provides (severe) penalties for even SPEAKING about circumvention (eg supplying online explanations); called 'anti-circumvention measures'
 


MGM v Grokster, 2005

Introduced doctrine of copyright inducement
Left Sony SNIU framework intact, despite MGM's arguments against it
See http://w2.eff.org/IP/P2P/p2p_copyright_wp.php for a lengthy article analyzing the decision.
The decision syllabus is at http://www.law.cornell.edu/supct/html/04-480.ZS.html, with links to Souter's opinion.
 
Note that the District Court and the Ninth Circuit granted summary judgement to Grokster!

1. Inducement:

Held: One who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, going beyond mere distribution with knowledge of third-party action, is liable for the resulting acts of infringement by third parties using the device, regardless of the device’s lawful uses. Pp. 10—24.
 
2. Contributory infringement.
Contributory infringement is similar to "aiding and abetting" liability: one who knowingly contributes to another's infringement may be held accountable. The Sony precedent might have blocked this, but if your primary goal is unlawful (as was Grokster's), you lose.
 
3. Vicarious liability.
Vicarious liability is derived from the same legal principle that holds an employer responsible for the actions of its employees.

Despite offsetting considerations, the argument for imposing indirect liability here is powerful, given the number of infringing downloads that occur daily using respondents’ software. When a widely shared product is used to commit infringement, it may be impossible to enforce rights in the protected work effectively against all direct infringers, so that the only practical alternative is to go against the device’s distributor for secondary liability on a theory of contributory or vicarious infringement.

Note that part of the issue here is the practicality (or lack thereof) of going after individual users.
 
"Filtering" argument: if an ISP fails to implement blocking or filtering, they have vicarious liability.


MGM had been hoping to get Sony v Universal overturned. In this they failed. Paragraphs (b) and (c) in the syllabus addresses the Sony precedent. The bottom line is that, while the Sony SNIU doctrine remains, Grokster went further (paragraph c):

The rule on inducement of infringement as developed in the early cases is no different today. Evidence of active steps taken to encourage direct infringement, such as advertising an infringing use or instructing how to engage in an infringing use, shows an affirmative intent that the product be used to infringe, and overcomes the law’s reluctance to find liability when a defendant merely sells a commercial product suitable for some lawful use.

Note that paragraph (d) begins: "On the record presented, respondents’ unlawful objective is unmistakable."

Finally, the court was unanimous in ruling that Grokster was liable for inducement. The 5-4 split was over whether Sony needed formal modification, with the answer being no for the time being.

What if Grokster had not actively induced users to engage in copyright infringement? Would that have gotten them off the hook?

Baase points out on page 218 (1st paragraph) that the DMCA has eroded this doctrine of SNIUs-make-it-ok; under the DMCA, circumvention of copy protection is illegal even if it has SNIUs. But this applies only to circumvention, not other potentially infringing uses.

At the top of page 216, Baase points out that it is not just computer technology that leads to societal debates about whether the technology should be banned. Drugs, guns, and power tools are also in this category.