SCOTUSBlog Petition of the Day: Fourth Estate Public Benefit Corp. v Wall-Street.com — The US Copyright Act requires a copyright owner to register her copyright with the US Copyright Office before she can file an infringement lawsuit. But courts are split on whether that requirement is satisfied when the registration application is received by the Copyright Office, or whether the copyright owner must wait until the Copyright Office has processed the application and issued a registration certificate (which currently can take 6-8 months). This appeal presents the issue to the Supreme Court; will it grant cert and resolve the split?

Kodi Addon Developers Quit Following Threats From MPA, Netflix, Amazon — A coalition of film and television producers have begun cracking down on developers and distributors of Kodi Addons that facilitate and encourage infringement. Torrentfreak reports that the efforts are beginning to pay off. Just this morning, the site reported another developer shutting down.

Copyright Small Claims: A Solution for Many Creators — David Newhoff writes of H.R. 3945, which would establish a streamlined, easy to use process for resolving small copyright claims, “It won’t solve every problem, but it should make a tangible difference for a significant population of creators who currently do not avail themselves of any enforcement procedure, but would if the barriers were lower. And frankly, copyright critics and internet-advocates (the ones who claim to care about creators) should actually support this bill because it establishes a forum for narrow, voluntary, and limited resolution between a rights holder and an alleged infringer without creating even a hint of a new liability implication for investing in web platforms.”

The End of Internet Exceptionalism – Or Why the Pirates Bet on the Wrong Horse — “In 2017, everything changed. It turns out that the Internet was not that different after all. It did not bring democracy, but election manipulation. Not free speech, but fake news. Not pluralism, but monoculture. Not quality, but algorithmic idiocy. Not grassroots, but skyscrapers. The surveillance state did indeed come, but not from copyright but from the internet companies. The pirates bet on the wrong horse: it was not Hollywood that broke the Internet, it was Silicon Valley.”

In a Surprise Verdict, Jury Says Developer Broke the Law by Whitewashing 5Pointz Graffiti Mecca — A very rare jury verdict finding a VARA violation. Eileen Kinsella of ArtNet reports, “The six-person jury found that real estate developer Gerald Wolkoff and his related companies broke the law when, in 2014, he whitewashed the 5Pointz graffiti mecca in Long Island City in the middle of the night. However, the jury decision will serve only as a recommendation to the case’s presiding judge, Frederick Block, who has yet to hand down a final verdict and assess whether any damages must be paid.”

Digital age changes all the rules on intellectual property — “Copyright law has served us well from the age of quills to the age of computers; and Congress has from time to time updated the law to stay abreast of new technologies, embracing photography, radio, sound recordings, movies, television, software, video games and more. Along the way, we became a literate and creative nation with the world’s most innovative, influential and lucrative creative industries. It’s now time for copyright laws to reflect the digital age.”

Something is wrong on the internet — A look at some of the creepy, partially algorithmically-generated videos found on YouTube’s platform geared toward children (given their consistent use of recognizable characters like Frozen’s Elsa and the Incredible Hulk, one might characterize them as part of “remix culture”). The author, James Bridle, concludes, “What concerns me is that this is just one aspect of a kind of infrastructural violence being done to all of us, all of the time, and we’re still struggling to find a way to even talk about it, to describe its mechanisms and its actions and its effects.”

Why Mark Zuckerberg’s Argument is Wearing Thin — A ‘free and open’ Internet has been an article of faith in and around Mountain View, Menlo Park, and its environs for two decades. The religious dogma, since the passage of two acts in 1996, generally holds that the Internet industry is somehow different and worthy of special protections. One act shields Internet companies from the liability they’d shoulder if they were considered to be publishers. (This is the legislation the sex-trafficking bill is amending.) The second exempts Internet companies from being sued for copyright infringement and other nasty behavior others might engage in on their platforms. Under this way of thinking, all the companies of Silicon Valley had to do was charge that something might hurt ‘innovation’ or threaten the ‘free’ nature of the Internet, and that something would be deemed bad. Remember SOPA, the Stop Online Piracy Act, a 2012 bipartisan measure the Internet industry summarily killed?”

I’ve decided to tell you guys a story about piracy — Maggie Stiefvater, author of The Raven King, shares her compelling personal experience about how piracy harms authors. As she observes, “pirating book one means that publishing cancels book two.”

An Objective Analysis of Piracy Site Blocking — Researcher Brett Danaher takes stock of his research on the effects of piracy and enforcement. “Mike Smith and I found that when Megaupload.com and Megavideo.com (the two largest piracy cyberlockers in the world) were both shutdown, many sites that linked to their content stopped working and many cyberlockers shifted their policies to be less tolerant toward copyright infringement. The result was a causal increase in revenues from digital movie sales and rentals of about 7.5%. Later, along with Rahul Telang, we found that even though the UK blocking the thepiratebay.org caused little decrease in total piracy and no increase in legal consumption, the UK blocking of 19 major video piracy sites in November 2013 caused a 12% increase in legal consumption and a large decrease in total piracy. Later, when 53 more piracy websites were blocked in November 2014, we found a similar effect.”

YouTube suspends critic’s ad account, then reverses course — YouTube is a lot better at finding and removing criticism about YouTube than it is about finding and removing infringing content.

Creativity and Innovation Unchained: Why Copyright Law Must be Updated for the Digital Age by Simplifying It — This research paper casts a critical look at both the online service provider safe harbors of the DMCA and the cable and satellite compulsory licenses.

Not every pattern is protected by copyright, even if creating it involved many choices — The US Copyright Office recently began publishing decisions by its Review Board, which considers requests from authors who have had their registrations denied by examiners. Here, two decisions involving graphic patterns are compared, one whose registration was denied after review and one whose registration was granted.

Above: Author T. J. Stiles delivers the keynote address at the Center for Protection of Intellectual Property’s Fall Conference, October 13, 2017.

Music Creators See Big Tech Earning Billions While ‘Strip-Mining Artists’ Work’: Guest Op-Ed — Musician and president of the Content Creators Coalition Melvin Gibbs writes, “The tech platforms wrap themselves in claims about free speech or internet censorship, but in the end they oppose measures to reduce pirated music and other creative works because that would hurt their bottom line.”

Another Season, Another Common-Law Copyright Opinion — Zvi Rosen writes about yesterday’s Florida Supreme Court decision finding that pre-1972 sound recording owners do not have a common law public performance right in Florida. The question came to the court after the Eleventh Circuit certified it as part of a lawsuit between the Turtle’s Flo & Eddie and Sirius XM Radio.

Internet “entrepreneur” shocked that copyright owner sued him for stealing their work — Also believes that all photographers do is put their photos online to trick people into copying them just so they can sue them.

Small Claims Bill Aims to Empower Copyright Owners and Creators — Kevin Madigan writes about H.R. 3945, the Copyright Alternative in Small-Claims Enforcement Act of 2017. The bill would establish a voluntary tribunal within the Copyright Office to provide streamlined resolution of copyright claims under $30,000. As Madigan notes, “The reality is that the majority of copyright owners are small businesses and individual creators who often lack the means to bring an infringement suit in federal court. According to a report by the Professional Photography Association, 70% of photographers have experienced unauthorized use of their work, but most instances of infringement are valued at less than $3,000. With relatively small sums of money and damages on the line, attorneys are reluctant to dedicate their time to representing individual artists and small businesses.”

Internet Archive Gives New Life to Old Books — “The people at the Internet Archive, a San Francisco nonprofit founded by Brewster Kahle, are relying on an important feature of the Copyright Act that allows libraries and archives to copy books for researchers and scholars in the last 20 years of the books’ copyright life, as long as they aren’t commercially available. The exception was added to Section 108, the part of the copyright law that provides special exceptions for libraries and archives, in 1998 when the copyright terms were extended by 20 years.”

NMPA Chief David Israelite on Music Licensing Issues: ‘The Value of the Song Is More Important Than the Process’ — Ed Christman at Billboard reports, “The National Music Publishers Assn., the Digital Media Assn. and various songwriter and record label groups are negotiating legislation that they hope will solve the mechanical licensing problems that have plagued digital music services, while hopefully achieving higher rates for music publishers and songwriters. It’s a proposed law that will create a mechanism and a new entity that will issue and oversee a blanket mechanical license for digital music services and record labels.”

Major Studios, Streamers Declare Legal War on TickBox — Netflix and Amazon’s content division join the six major film studios in a lawsuit filed against TickBox, one of the many fully-loaded Kodi boxes on the market that provide consumers with access to pirated works at the push of a button. The complaint alleges inducement of infringement—”With a wink and a nod, TickBox tells prospective customers they can ‘of course’ still use ‘Amazon Video, Netflix or Hulu on Tickbox TV’— but TickBox confidently predicts that, ‘within a few days of using Tickbox TV™ you will find you no longer need those subscriptions’ (because TickBox TV is intended to substitute for such services)”—and contributory infringement.

Strong copyright protections in NAFTA renegotiations are needed to protect rights of creatives — Gale Anne Hurd, producer of such films and television shows as the “Terminator” trilogy, “Aliens”, “Armageddon”, and “The Walking Dead”, speaks up in favor of effective copyright provisions in free trade agreements in this op-ed.

U.S. Government, Hollywood Studios Weigh in on Dispute Exploring Reach of U.S. Copyright Law — The case is Spanski Enterprises v Telewizja Polska, currently on appeal to the DC Circuit Court of Appeals. Besides extraterritoriality, the appeal raises the question of whether “volitional conduct” is required for infringement of the public performance right.

The Forgotten Origins of Copyright for Photographs — More excellent historical detective work from Zvi Rosen, who here presents an unsuccessful bill to extend copyright protection to photographs a year before Congress succeeded in passing such legislation.

Website blocking in Malaysia has reduced online piracy, says film makers body — According to the Motion Picture Association, traffic to pirate sites in Malaysia dropped 74% in the six months after the government initiated its sixth effort to block such sites in June 2016.

Re:Creating Reality: NAFTA, Dangerous Harbors & Unfair Use — Neil Turkewitz takes aim at a recent op-ed by the Re:Create Coalition, who is, in Turkewitz’s words, “no fan of copyright.”

On Eve of ‘Blurred Lines’ Appeal Hearing, Richard Busch is the Music Industry’s Most Feared Lawyer — Oral arguments in the “Blurred Lines” case, on appeal after a jury held that Robin Thicke and Pharrell Williams infringed on Marvin Gaye’s “Got to Give it Up” when they created “Blurred Lines.” Rob Levine interviews the attorney who represented two of Gaye’s children in the case. The Ninth Circuit provides live streaming of oral arguments, which you can access here.

A Small Claims Court is on the Horizon for Creators — Great news for creators, as this week a bipartisan group of legislators introduced the Copyright Alternative in Small-Claims Enforcement (CASE) Act of 2017. The bill would establish a voluntary tribunal within the Copyright Office to hear claims under $30,000.

Working in the International Arena: The Special 301 Process — Emily Lanza at the Copyright Office peels back the curtain on that agency’s role in the Special 301 process, which monitors trading partners and identifies countries that deny adequate and effective protection of intellectual property.

Publishers and societies take action against ResearchGate’s copyright infringements — The coalition statement reads in part, “ResearchGate’s primary service is taking high-quality content written and published by others and making as many as 7 million copyrighted articles – 40% of its total content – freely available via its for-profit platform…ResearchGate’s business model depends on the distribution of these in-copyright articles to generate traffic to its site, which is then commercialised through the sale of targeted advertising. ResearchGate often also substantively alters articles for the same purpose, and where corrections or retractions are issued, it fails to update articles accordingly on its site, undermining research integrity.”

U.S. Supreme Court Declines to Review Kim Dotcom Case — Finally, Dotcom, who consistently proclaims his innocence on charges of criminal copyright infringement, loses another attempt to delay actually appearing in court.

Petition of the day — SCOTUSblog highlighted the petition in Perfect 10 v Giganews this week. Giganews initially waived its right to respond, but the Supreme Court has requested a response by October 20. The issue: “(1) Whether the U.S. Court of Appeals for the 9th Circuit correctly held—in conflict with the U.S. Courts of Appeals for the 2nd, 6th, 7th, and 8th Circuits—that a defendant “profits from” direct infringement for purposes of vicarious copyright liability only if a plaintiff proves that its work, as opposed to the totality of the infringing content offered by defendants, was the reason customers were drawn to the defendant’s business; and (2) whether the U.S. Court of Appeals for the 9th Circuit correctly held—contrary to the decisions of the Supreme Court—that a defendant does not engage in direct copyright infringement when it displays, reproduces, or distributes infringing material, so long as that conduct is accomplished through an automated process.”

Italian Supreme Court confirms availability of copyright protection to TV formats — From IPKat: “As reported by DIMT – Diritto Mercato Tecnologia, in its 2017 decision in RTI Reti Televisive Italiane Spa v Ruvido Produzioni Srl, decision 18633/17 (27 July 2017), the Italian Supreme Court (Corte di Cassazione) confirmed that TV formats can be protected under the Italian Copyright Act (Legge 633/1941), and clarified at what conditions such protection is available. The Court recalled that the Italian Copyright Act does not contain a notion of ‘format’. However the definition provided in Bulletin 66/1994 of SIAE, which also allows authors of formats to deposit them, should be taken into account.”

Having a Bubble Bath or Why the “Buried” Piracy Report Got It All Backwards — Per Strömbäck writes, “The main problem is that the study only looks at how sales changed from 2009 to 2013 (this is page 74 and following). This is like checking the temperature ten minutes after I start adding cold water to my bath! The large-scale impact of internet piracy of music started in 1999.”

Compendium of U.S. Copyright Office Practices — A revised version of the Copyright Office’s Compendium is now available and effective as of today. The Compendium details the Copyright Office’s registration and examination practices in a publicly accessible manner and is highly useful for answering questions regarding issues such as copyrightability and originality. The revisions incorporate legal and regulatory changes since the previous version was published as well as public comments received by the Office responding to a draft of the revised version posted this past summer.

A recent copyright decision articulates in clear and direct language the underlying policies that guide copyright law. This past January, several publishers and author estates filed suit against Frederik Colting and Melissa Medina for allegedly infringing their works through a series of childrens’ books called “Kinderguides”. These books were billed as “Learning Guides” to classical works of literature by defendants; they each generally followed a similar format, with a story summary followed by a series of back-pages containing, for example, keywords and quizzes. At issue here were works still under copyright protection: Breakfast at Tiffany’s by Truman Capote, The Old Man and the Sea by Ernest Hemingway, On the Road by Jack Kerouac, and 2001: A Space Odyssey by Arthur C. Clarke. Defendants argued that any potential infringement was excused by fair use.

The court ruled against the defendants in late July, finding that they were liable for infringement and not excused by fair use. On September 7, Judge Rakoff of the Southern District Court of New York issued a detailed opinion describing his reasoning.

Copyright aficianados may remember Colting from the 2010 Second Circuit decision Salinger v Colting, where he was facing allegations of copyright infringement over an unauthorized sequel to J.D. Salinger’s Catcher in the Rye. 1The Second Circuit vacated the district court’s preliminary injunction on the grounds that it did not apply the proper standard, though it agreed with the court’s conclusion that Colting was not likely to succeed on his fair use claim. The parties subsequently settled, with Colting consenting to a permanent injunction barring him from publishing or distributing his unauthorized sequel. The current case demonstrates that he has not strayed far from the type of conduct that landed him in court then.

The case also demonstrates Judge Rakoff’s deft ability to apply the sometimes challenging concepts involved with copyright to determine that the Kinderguides are substantially similar to the original works, despite Colting’s attempt to argue that he only copied unprotected elements from the works. (For example, “Breakfast at Tiffany’s is, according to defendants, just the story of ‘a small town girl with a tough past who has come to the big city'” and thus a stock, unprotected character.)  He also easily rejects defendants’ fair use defense, with a particularly clear and correct articulation of the fourth fair use factor, which instructs courts to consider “effect of the use upon the potential market for or value of the copyrighted work.”

But it is under Judge Rakoff’s examination of “other considerations” within the fair use analysis where this opinion really stands out. He writes that among these other considerations “is whether, as defendants argue, their works should be protected because otherwise the constitutional purpose of copyright law — to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries — would be frustrated.”

The crux of defendants’ argument is that plaintiffs have declined to create children’s versions of their novels, so it would be contrary to the constitutional imperative of copyright for them to be able to use their exclusive rights to bar others from doing so. But, Judge Rakoff replies, “Congress did not provide a use-it-or-lose-it mechanism for copyright protection. Instead, Congress granted a package of rights to copyright holders, including the exclusive right to exploit derivative works, regardless of whether copyright holders ever intend to exploit those rights.

I agree fully with Judge Rakoff, and believe his statement is correct not just for copyright but for all property. Once the decision has been made to vest exclusive rights in a resource to an owner, as government has historically done with property and Congress has done through the Copyright Act, that right remains exclusive regardless of whether a non-owner sincerely believes they may put the resource to better use. At times, the non-owner may even be correct. But absent an exception, property prioritizes the owner’s use (or non-use) over the non-owner’s interest in use because in the aggregate, among other benefits, this facilitates the most productive use of resources. 2See, for example, Eric Claeys, Labor, Exclusion, and Flourishing in Property Law 95 N.C. L. Rev. 413 (2017).

That is not to undervalue the work that exceptions do at the margins, but at its core, this initial allocation of entitlements—property—is exactly what Congress had in mind. It is, indeed, not a “use-it-or-lose-it” mechanism. Rather, it is a “set-it-and-forget-it” mechanism.

But Judge Rakoff is not finished—he takes defendants further to task. Rakoff writes, “Implicit in defendants’ argument, then, is a contention that the Copyright Act itself is unconstitutional. As defendants put it, ‘the original copyright act granted authors exclusive rights for a 14-year term, with the option for a renewal term of the same length. Over the course of the following 200+years, the grant of rights has expanded unchecked, leading us here today.”

This is a common argument among copyright minimalists, who point to the 1790 Copyright Act as though it should operate as some ideal baseline for copyright policy, despite the fact that the first Congress spent very little time creating the Act (the majority of it was cribbed directly from England’s Statute of Anne)3See Oren Bracha, The Adventures of the Statute of Anne in the Land of Unlimited Possibilities: The Life of a Legal Transplant, 25 Berkeley Tech. L.J. 1427 (2010). and despite the extraordinary cultural and technological changes since that time. Rakoff spent little time rebutting this argument. “Defendants are no doubt correct in pointing out that Congress’ policy judgments have changed substantially over the course of our nation’s history.”

[B]ut as a legal matter, for the Copyright Act to withstand constitutional scrutiny, it must merely be the case that, in constructing its general scheme, Congress had a rational basis to believe that granting a suite of exclusive derivative rights to copyright holders would advance progress in the sciences and the arts. See Eldred v. Ashcroft, 537 U.S. 186, 208 (2003) (finding that, if the Copyright Act is “a rational enactment,” the Court is “not at liberty to second-guess congressional determinations and policy judgments . . . however debatable or arguably unwise they may be”). As defendants make no effort to show that Congress lacked such a rational basis for providing plaintiffs an exclusive right to exploit derivative works, including children’s adaptations, this Court cannot provide defendants with the relief they are seeking.

Perhaps recognizing the futility of continuing to push this argument, defendants subsequently stated that an appeal of the decision would be “highly unlikely.”

References   [ + ]

1. The Second Circuit vacated the district court’s preliminary injunction on the grounds that it did not apply the proper standard, though it agreed with the court’s conclusion that Colting was not likely to succeed on his fair use claim. The parties subsequently settled, with Colting consenting to a permanent injunction barring him from publishing or distributing his unauthorized sequel.
2. See, for example, Eric Claeys, Labor, Exclusion, and Flourishing in Property Law 95 N.C. L. Rev. 413 (2017).
3. See Oren Bracha, The Adventures of the Statute of Anne in the Land of Unlimited Possibilities: The Life of a Legal Transplant, 25 Berkeley Tech. L.J. 1427 (2010).

HTML5 DRM finally makes it as an official W3C Recommendation — “The World Wide Web Consortium (W3C), the industry body that oversees development of HTML and related Web standards, has today published the Encrypted Media Extensions (EME) specification as a Recommendation, marking its final blessing as an official Web standard. Final approval came after the W3C’s members voted 58.4 percent to approve the spec, 30.8 percent to oppose, with 10.8 percent abstaining.”

Court Rules Copyright is Not a “Use It or Lose It” Right — Stephen Carlisle discusses the recent Southern District Court of New York decision in Penguin Random House v Colting, where Judge Rakoff rejected defendant’s fair use defense regarding unauthorized children versions of classic novels like Breakfast at Tiffany’s and 2001: A Space Odyssey.

CreativeFuture Pushes Back on Internet Industry’s Claim That They Are ‘New Faces’ of Content — “In a letter to Lighthizer, Ruth Vitale, the CEO of CreativeFuture, wrote that ‘while I would take issue with anyone claiming to represent all ‘the new faces of the American content industry,’ I can comfortably tell you that CreativeFuture represents many of the true faces.’ She added that they ‘respectfully disagree with the views expressed by those tech trade associations.'”

Open Markets Opens Shop After Google Dust-Up — The Authors Guild writes, “We’re hopeful that the attention that incidents like these bring to Internet monopolies’ control of our information infrastructure and the related harm they bring to the creative industries is part of a growing recognition that the regulation of Internet giants like Google and Amazon may be required to keep intact the free flow of information in this country.”

Using Things, Defining Property — GMU Law professor Chris Newman this week posted a forthcoming paper on the definition of property, including intellectual property. Smart stuff, as expected.

Artist Rights Watch writes of the above trailer, “If you’re not aware of this indie film about producer Mark Hallman and his Congress House Studios, you really should check it out.  Rain Perry tells the story that we all know from the point of view of a great craftsman. You can rent or buy the picture directly from the film maker here.”