I know an internet meme has hit the mainstream when my mother asks me about it.
“Did you hear they want to throw people who post videos of lip-synching online in jail?” she asked me the other day.
She was referring to bill S.978, the Commercial Felony Streaming Act. The bill has raised considerable consternation online, with fears that it will be used against people engaged in all sorts of conduct that has up to now escaped legal attention, like posting videos on video-sharing sites or embedding videos on blogs. I had previously written about why those fears are overblown.
But those fears continue. Today I want to address the bill more in depth from a legal perspective to allay those fears.
The bill is addressed toward only large-scale, commercial piracy, and the bill is drafted accordingly.
To see why, I’ll show how the language creates several high bars to prevent it being applied to other types of infringement. But first, a little background.
Criminal Infringement of the Public Performance Right
If you take away only one thing from this article, take away this: S.978 doesn’t change what is legal and what is illegal.
Copyright is really a bundle of rights: the right to reproduce, distribute, and publicly perform, among others. Infringing any of these rights can trigger criminal infringement prosecution. Criminal infringement of reproduction and distribution has long carried felony charges in certain circumstances, but criminal infringement of other rights like public performance has been a part of the law since 1897 and has included the possibility of jail time.
Online, the distinction between what right is implicated by certain conduct blurs. Some courts have made a distinction between “downloading” and “streaming” to draw a line between reproduction and public performance, 1See, for example, US v. ASCAP, 485 F.Supp.2d 438 (SDNY 2007). though that doesn’t entirely clear up the confusion.
The distinction between downloading and streaming is not really a technical one. As Cory Doctorow explains in a 2009 column “Streaming will never stop downloading,” streaming is really only a subset of downloading. A work is still being copied, except with “streaming”, a user can start watching or listening before the entire work is finished copying, and generally, the copy isn’t permanently stored where it can easily be accessed later.
Legally, there is a difference between copying and a public performance. Ideally, that would translate online to a distinction between downloading and streaming, but as I just mentioned, that’s a difficult distinction to make.
Meanwhile, copyright owners are harmed just the same whether a site owner offers a movie that can be downloaded first and watched later or watched as soon as the downloading starts. Some copyright owners are particularly harmed by streaming: sports events are nearly always streamed since much of the experience comes from watching the event live.
Newly minted Register of Copyrights Maria Pallante explained the scope of this harm last June:
During its 2009-2010 professional basketball season, the NBA identified 2,975 unauthorized streams on just eight websites/services, while in the current 2010-2011 NBA season, the NBA identified more than 2,700 unlawful streams of games on just one foreign website alone. According to industry sources, monthly traffic to ten of the cyber lockers that provide unauthorized access to streamed content grew by 13 million separate users per month during 2010, to 105 million separate users per month. And a recent NBC Universal-commissioned study found that one site that provided access to pirated movie streams had 6.5 million unique users each month, while another similar website had 5 million unique users each month. Recent legal challenges involving claims of unauthorized streaming include a complaint by the Ultimate Fighting Championship (UFC) against life-casting website Justin.tv alleging that more than 50,000 viewers watched illegal streams of a live UFC bout, “UFC 121 Lesnar v. Velasquez” through the site, and that UFC vendors removed over 200 infringing feeds during just that live event. 2Promoting Investment and Protecting Commerce Online: The ART Act, the NET Act and Illegal Streaming, Statement of Maria A. Pallante, Register of Copyrights, before the Subcommittee on Intellectual Property, Competition, and the Internet Committee on the Judiciary United States House of Representatives, 112th Congress, 1st Session (June 1, 2011).
Bill S.978 seeks to address these problems by standardizing the penalties for large-scale, willful, commercial infringement of a public performance with the penalties for the same type of infringement of the reproduction and distribution right. S.978 amends the criminal copyright infringement provisions in part to add the following, stating that any person who willfully infringes a copyright:
(2) shall be imprisoned not more than 5 years, fined in the amount set forth in this title, or both, if–
(A) the offense consists of 10 or more public performances by electronic means, during any 180-day period, of 1 or more copyrighted works; and
(B)(i) the total retail value of the performances, or the total economic value of such public performances to the infringer or to the copyright owner, would exceed $2,500; or
(ii) the total fair market value of licenses to offer performances of those works would exceed $5,000
The language of the statute sets forth several bars to arbitrary and unreasonable application of the law, including its requirement of willfulness and the value necessary to trigger it. Let’s take a look at both of these in turn before looking at some more general bars to its application.
Civil copyright infringement is a strict liability tort — the intent or state of mind of an alleged infringer is irrelevant, and “innocent” infringement is not a defense. 3Although innocent infringement may reduce the minimum statutory damages available if the plaintiff seeks them.
Criminal copyright infringement, however, requires intent. The infringement must be “willful.” Courts have interpreted this to mean an “intentional violation of a known legal duty.” 4Prosecuting Intellectual Property Crimes, USDOJ, pg. 30, Third Edition (2006). In other words, in a criminal copyright trial, the government must prove a “bad purpose” or “evil motive” rather than merely an “intent to copy and not to infringe.” 5US v. Moran, 757 F.Supp. 1046, 1048 (D. Neb. 1991).
This is a high standard. In addition, it is a subjective rather than an objective standard, meaning the question is not whether a reasonable person would have known certain conduct infringed a copyright but rather what the alleged infringer himself thought, even if he was obviously wrong.
A good example of this distinction is found in the case law. In US v. Moran, the owner of a “mom-and-pop” movie rental store was charged with criminal copyright infringement after an investigation revealed that he was making a copy of every movie he got to rent out, keeping the originals in storage.
The owner testified that he did this as “insurance” because movies frequently became damaged or vandalized as they were rented out, and he was under the impression that, while piracy is illegal, his type of conduct was not. On this point, he was wrong, but the court noted that he honestly believed he was operating within the law, so the standard of willfulness hadn’t been met.
Obviously there are limits to this. Bad-faith claims or outright lying won’t save a willful infringer. Neither will disagreement over the validity of copyright law itself. 6See Cheek v. US, 498 US 192 (1991).
But it does mean that someone posting a mashup that they think is a fair use won’t find FBI agents at their door, 7The Prosecuting IP Crimes Manual says fair use has “rarely” been developed in criminal cases, in part because of the willfulness standard. I have yet to see a criminal copyright infringement case that presented a colorable fair use defense. nor does it mean an online intermediary with a legitimate DMCA policy in place will find itself in criminal court anytime soon.
The second bar that has to be passed for a conviction under S.978 is establishing value. The proposed bill establishes two separate measures of value: either 10 or more performances within 180 days where the total retail value (or total economic value to the infringer or copyright owner) exceeds $2,500 or where the total fair market value of licenses to offer performances would exceed $5,000.
Contrary to some of the commentary I’ve seen, these numbers — retail value, total economic value, or fair market value — can’t be pulled out of thin air. They mean what they say they mean, not whatever a copyright owner or the government wants them to mean.
Retail value is simply what an authorized version would cost at the store. Felony provisions for reproducing a copyrighted work use the same measure of value. 818 USC § 2319(b). So a bootlegger copying a $20 DVD would need to make 125 copies in 180 days before coming within the scope of the felony provision.
What is the value of a performance? It’s equivalent to the fee for streaming or renting. New movie releases can be streamed online from places like Amazon and iTunes typically for $3.99. Pay-per-view events like UFC fights generally hover around $50.
Things like clips or cover songs would have values that are fractions of these. Your ordinary blogger won’t come close to reaching this bar. But a website operator pulling in 5 figures a year for offering hundreds (if not thousands) of unauthorized movies, TV shows, and sporting events (as evidence from Operation in Our Sites has shown was common for the sites whose domain names were seized) will.
Perhaps the biggest reason not to worry about this bill is that the government must prove willfulness, the total value, and all other elements of criminal copyright infringement under S.978 beyond a reasonable doubt. In a civil trial, a plaintiff only has to prove the elements of the case by a preponderance of the evidence — it is more likely than unlikely that a certain thing is true. It is far easier to be found civilly liable than it is to be found criminally guilty — just ask OJ Simpson.
The rule of lenity acts as another bar in criminal law. Criminal courts must construe any gray areas in a statute in favor of a defendant.
Finally, in my previous post, I talked about why prosecutorial discretion acts as a bar, a discussion that some have interpreted as me saying “trust the government.” That’s not the case.
The discussion here shows why the law itself prevents S.978 from being applied to conduct that many fear it applies to. These legal principles, however, prevent such convictions. Prosecutorial discretion — specifically, the government’s incentive to only bring cases it knows it can win and its limited time and resources to prosecute cases — means that those cases in the bubble between clearly legal and clearly illegal conduct won’t be prosecuted in the first place.
To sum up, Bill S.978 can’t be used to prosecute the uses that many fear it applies to. It doesn’t change what conduct is legal and what conduct is illegal. It is designed to apply only to outright pirates who profit off the streaming of unauthorized copyrighted works, and the language reflects this design.
References [ + ]
|1.||↑||See, for example, US v. ASCAP, 485 F.Supp.2d 438 (SDNY 2007).|
|2.||↑||Promoting Investment and Protecting Commerce Online: The ART Act, the NET Act and Illegal Streaming, Statement of Maria A. Pallante, Register of Copyrights, before the Subcommittee on Intellectual Property, Competition, and the Internet Committee on the Judiciary United States House of Representatives, 112th Congress, 1st Session (June 1, 2011).|
|3.||↑||Although innocent infringement may reduce the minimum statutory damages available if the plaintiff seeks them.|
|4.||↑||Prosecuting Intellectual Property Crimes, USDOJ, pg. 30, Third Edition (2006).|
|5.||↑||US v. Moran, 757 F.Supp. 1046, 1048 (D. Neb. 1991).|
|6.||↑||See Cheek v. US, 498 US 192 (1991).|
|7.||↑||The Prosecuting IP Crimes Manual says fair use has “rarely” been developed in criminal cases, in part because of the willfulness standard. I have yet to see a criminal copyright infringement case that presented a colorable fair use defense.|
|8.||↑||18 USC § 2319(b).|