March 14, 2014 · · Comments Off

Lupita Nyong’o and Celebrating Unsung Artists — “We celebrate successful artists — artists with the machinery of celebrity behind them — but how do we celebrate all of the other people who are making art each and every day? And, forget celebrating them: How do we support them? How do we make it economically viable for them to make art? We don’t. And, for the sake of our culture, we should.”

Slate’s Anti Copyright rant sounds like a letter from your psycho ex — The article insists that voluntary agreements to reduce the harms of infringement are the new SOPA, because in the two years since the bill was stopped, saying something is the new SOPA is the best strategy some copyright skeptics have been able to come up with.

Victims of IP theft need better protection — Reps. Judy Chu and Tom Marino highlight the challenges facing indie artist Christine Filipak in keeping up against the tide of infringement she faces. Just in time for yesterday’s IP Subcommittee hearing on the DMCA notice and takedown process. Along the same lines, check out Mark Schultz’s article, Time to revise the DMCA: the most antiquated part of the copyright may by one of the newest.

Transformative or just taking? Lawyers struggle to define fair use in wake of Google Books case — Report from a NYC Bar Association panel Monday featuring Judge Chin, who recently held Google Books to be a fair use, and other noted copyright lawyers and scholars.

Oakland emails give another glimpse into the Google-Military-Surveillance Complex — “The evidence was abundant and overwhelming: in email after email, Oakland officials had discussed the DAC usefulness for keeping tabs on activists, monitoring non-violent political protests and minimize port disruption due to union/labor strikes. In particular, officials wanted to use the surveillance center to monitor Occupy Wall Street-style activists, and prevent union organizing and labor strikes that might shut down the Port of Oakland. *** But buried deep in the thousands of pages of planning documents, invoices and correspondence was something that the activists either seemed to have missed or weren’t concerned by. A handful of emails revealing that representatives from Oakland had met with executives from Google to discuss a partnership between the tech giant and the DAC.”

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This morning, the House Judiciary Committee Subcommittee on Courts, Intellectual Property, and the Internet will continue its ongoing review of the Copyright Act, focusing this time on Section 512 of Title 17, the DMCA’s notice and takedown provisions.

No doubt, copyright’s skeptics will trot out their usual line of DMCA abuse, so I thought it would be appropriate to offer my own. Here, in no particular order, are my top examples of DMCA notice and takedown abuse: sites and services which had claimed the protection of the law while receiving millions of notices of infringing content and profiting handsomely, to the detriment not just of the large copyright holders who could afford to send takedowns (and litigate if need be) but especially to the detriment of individual creators and small businesses, who effectively have no recourse:

Hotfile

Filelocker Hotfile was founded in 2009. By the time it was sued for copyright infringement by the major motion picture studios in 2011, it had become one of the most popular such sites. In part, this was because the site did such a good job facilitating infringement among its users—evidence showed over 90% of files downloaded through the service were infringing, and the court noted that these efforts “worked a significant financial benefit to Hotfile and its founders.”

Hotfile, of course, argued strenuously that it was operating consistent with the DMCA.

The facts showed a different story. One of the requirements for the DMCA safe harbor is that a site adopts and reasonably implements a “repeat infringer” policy, one that terminates accounts in appropriate circumstances. The court found that Hotfile was doing anything but. When the litigation began, Hotfile had received over 10 million takedown notices for infringing content on its system.  But records show that it had only ever terminated a grand total of 43 users—though 33 of those came as a result of a court order from prior litigation. Nearly twenty-five thousand Hotfile users had accumulated over three infringement notices. Over sixty of those users were sitting on at least three hundred notices.

And as proof that Hotfile could have adopted a reasonable repeat infringement policy but didn’t, and that it would make a difference, the service revamped its policy after the litigation began and almost immediately 444 of its 500 highest paid affiliates were terminated for repeated infringement. Hotfile ended up shutting its doors and settling with the motion picture studios for $80 million the day before it was set to face a jury.

It’s difficult enough for creators to detect and deter online infringement, but some bad actors use the DMCA as legal cover, window dressing that places a façade of legitimacy over plain old for-profit exploitation. The law, however, is more than just a notice-and-takedown mechanism, and services have a number of requirements they must meet to enjoy its protection.

Megaupload

In 2012, the US government brought criminal charges against filelocker Megaupload and seven of its officers. Like Hotfile, Megaupload argued that it was merely an innocent cloud storage provider, shielded by the DMCA, but publicly released evidence shows the site used the law as a sword, helping it rake in $150 million and causing around $500 million in damages to copyright holders.

While the government alleges Megaupload failed to meet most of the DMCA’s requirements, one policy in particular stands out as DMCA abuse. According to the Department of Justice:

If there are multiple links to a file, then any attempt by the copyright holder to terminate access to the file using the Abuse Tool or other DMCA takedown request will fail unless all of the URL links to the infringing file are known and submitted, because the file will continue to be available through any undisclosed URL links. The infringing copy of the copyrighted work, therefore, remains on the Mega Conspiracy’s systems as long as a single link remains unknown to the copyright holder. The Mega Conspiracy maintains a record of links that have been generated by the system, but duplicative links to infringing materials are neither disclosed to copyright holders, nor are they automatically disabled or deleted when a copyright holder either uses the Abuse Tool or makes a standard DMCA copyright infringement takedown request. During the course of the conspiracy, the Mega Conspiracy has received many millions of requests to remove infringing copies of copyrighted works, and yet the Mega Conspiracy has, at best, only deleted the particular URL of which the copyright holder complained, and purposefully left the actual infringing copy of the copyrighted work on the Mega Conspiracy-controlled server and any other access links completely intact.

This is a deliberate end-run around the law’s purpose of cooperation between service providers and copyright owners to detect and deter infringement. “Takedown” should mean “takedown” (ideally, it should also mean “stay down”, but that’s another story).

Grooveshark

One of the safe harbors in the DMCA protects against liability for material stored at the direction of users. So why couldn’t you have users store music files on your servers and then provide an on-demand streaming platform with a catalog rivaling licensed music services? That’s the too-clever-by-half strategy employed by Grooveshark (along with allegations that it requires employees to upload music themselves to plug any holes). Grooveshark is currently involved in copyright infringement litigation with a number of record labels, and indie musician Erin McKeown has repeatedly called them out for their practices:

Noted copyright scholar Peter Menell has also written about the service, calling it a case study in DMCA safe harbor abuse. The “DMCA license” that services like Grooveshark believe they are entitled to under the law—where services believe it’s ok to build full-fledged content platforms without licenses so long as they “launder” the content through users—not only allows them to divert money out of the hands of musicians, but it makes it more difficult for legitimate, sustainable online platforms to grow.

IsoHunt

At one point, IsoHunt was one of the world’s most popular BitTorrent search engines, indexing and helping users search and find torrent files—90-96% of which were infringing. As with the services above, IsoHunt claimed DMCA protection. But last year, the Ninth Circuit rejected that claim.

The primary reason was that IsoHunt was actively inducing infringement through its service:

As noted, the record is replete with instances of Fung actively encouraging infringement, by urging his users to both upload and download particular copyrighted works, providing assistance to those seeking to watch copyrighted films, and helping his users burn copyrighted material onto DVDs. The material in question was sufficiently current and wellknown that it would have been objectively obvious to a reasonable person that the material solicited and assisted was both copyrighted and not licensed to random members of the public, and that the induced use was therefore infringing.

It would seem obvious that service provider actively engaged in encouraging infringement (and, as the record showed, profiting from it) could find refuge in a statue designed to protect service providers from incidental and innocent infringement that occurs on their facilities. But that is unfortunately not always the case. The DMCA should not be so broad that it protects against deliberate infringing behavior.

Though these sites have been or are currently the subject of legal action, there are sadly far too many like them continuing to operate, hiding behind the DMCA to profit off the work of others without their permission. This abuse penalizes good faith service providers and stymies the growth of legitimate innovative services. It exploits creators—and worse, chill their ability to create and disseminate new works for the public to enjoy.

As Congress looks at the DMCA, it should look for ways to reduce the ability of bad faith actors to abuse the important protections the law provides. That would better foster the type of sustainable and innovative online creative ecosystem that the public deserves.

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Last week the Supreme Court received the first round of amicus briefs in American Broadcasting Companies v. Aereo. Individuals and organizations who support the broadcasters’ position (or support neither party) filed nearly 20 briefs; in a few weeks we’ll see Aereo’s opening brief, followed a week later by amici in support of Aereo, setting the stage for oral arguments in front of the Court on April 22.

The issue in front of the Court should be familiar by now to anyone following the case, but to reiterate, it is this: does Aereo violate a copyright owner’s exclusive right to perform a work publicly?

In a series of posts, I broke down this inquiry into its component parts. First, I asked, “what is to the public“? Then I asked “what is a performance“?

Much ink has been spilled over how the Supreme Court should rule in Aereo, and my posts, concluding that, yes, Aereo does perform to the public, were no exception. The primary argument in favor of Aereo is that it is Aereo’s customers, not Aereo itself, engaged in performing broadcast television to users.

So it would seem that one question remains as to Aereo’s ultimate liability: who is the “performer”? This question is pivotal. If, as I have argued, we interpret “to the public” as requiring a look at the relationship between performer and audience, then a conclusion that it is the user engaged in performing would mean the performance is private, since a user-to-user performance is undoubtedly private. But if Aereo is the performer, the opposite conclusion seems required, since the relationship between Aereo, Inc. and its paying subscribers is very likely a public one. In other words, the latter involves direct liability for copyright infringement while the former does not.

But rather than attempting to answer this question here and now, I want to reframe it. Specifically, I want to suggest that the question of who “performs” a work is not a copyright question.

That does not mean it is any less valid of a question. It just means it is a question involving legal doctrines besides copyright law. If the argument, for example, is that Aereo is merely renting equipment to users to engage in otherwise legal actions, than the question is whether this is actually what is happening (and not just legal sleight of hand) and whether the agreement between Aereo and the user is sufficient to shift liability from Aereo onto the user. This involves questions of contract and tort rather than copyright.

Indeed, tort law provides a diverse array of doctrines that can be called upon to answer who a “performer” is: ideas such as proximate causation, agency, and perhaps even bailment.

The answer does not, however, come from the Copyright Act.

What is the import of this claim? For one, it means that it is not necessary to torture the text of the Copyright Act to reach a conclusion that it is a user of Aereo rather than Aereo who is performing a work. The text of the Transmit Clause is straightfoward: one performs a work publicly if they transmit a performance of the work to the public, by means of any device or process. Only the most baffling interpretations can make “by means of any device or process” mean “by means of any device or process… except 1,000 antennas” or “by means of any device or process… except 10,000 antennas.”

It also means the legislative history of the public performance provisions in the 1976 Copyright Act are of no help. In fact, the legislative history compels the conclusion that the Copyright Act is the wrong place to turn to for answering who the “performer” is.

In 1965, the Register of Copyrights released a report on the current version of the Copyright Act, one in which the public performance provisions were substantially the same as those that would eventually become law. In the report, the Register noted that Congress “adopted the approach, like that taken in foreign laws, of stating the public performance right in broad terms in section 106, and of providing the specific exemptions for educational and other nonprofit uses in section 109.”1

It signals this breadth through its explanations of the definition for performances in the draft revision:

A work may be performed ”either directly or by means of any device or process,” and these devices or processes would encompass sound or visual reproduction equipment of all kinds, amplifying systems, radio and television transmitting and receiving apparatus, electronic retrieval devices, and a host of other techniques, undoubtedly including some not invented yet.2

It goes on to state that the language adopted was intended to cover all commercial providers of copyrighted broadcasts except for explicitly provided exceptions:

The bill does not exempt community antennas and other commercial systems that retransmit broadcasts of copyrighted material to the public. It would, however, under section 109(5), exempt operators of nonprofit “boosters” or “translators” who retransmit, “without altering or adding to the content of the original transmission, without any purpose of direct or indirect commercial advantage, and without charge to the recipients.”

So there is no mistake, the report explains just how broadly the language of the Copyright Act should be read, including the note that a specific exception for “common carriers” was considered and rejected.

We have therefore adopted the phrase “transmit or otherwise communicate * * * to the public” to cover every method by which the images or sounds comprising a performance or exhibition can be picked up and conveyed to the public. This concept would include, among other things: direct amplification (as over a loud speaker system); transmission over wires or other connections; wireless transmission by the originating transmitter and by any other transmitter who picks up his signals and passes them on; and further transmission, over wires, of a wireless transmission. Likewise, although probably also covered under clause (A), it would include performances in public places resulting from the playing of records on jukeboxes and other sound reproducing equipment and from the reception of wired or wireless transmissions.

In effect, the definition is intended to cover every transmission, retransmission, or other communication of a performance which reaches “the public.” The 1964 bill contained language exempting transmissions by someone acting, “as a common carrier,” the thought being that a corporation merely leasing wires or equipment for the intermediate transmission of signals to other transmitters, rather than to the public, should not be subjected to liability to the copyright owner. It was pointed out that the concept of “common carrier” might be extended unjustifiably to some commercial transmitters to the public, and we have therefore dropped this exception as ill-advised. We are convinced that purely intermediate transmissions should be exempt, but that an express exemption is not necessary to exclude them.

There is further evidence that Congress did not intend for the language of the public performance provisions to explain the distinction between cable services and antenna rental services. For example, following the district court’s decision in United Artists Television v. Fortnightly Corporation,3 which found the operator of a community antenna television service liable for publicly performing copyrighted works, a bill was introduced that would establish three categories of liability: CATV operators would not be liable for providing access to broadcasts within the broadcast area. Liability would attach where a CATV operator provided access to distant broadcast signals, and a reasonable license fee would be required where CATV services brought outside signals when local viewers were not “adequately served” by three major networks. CATV operators rejected this approach.4

The Supreme Court eventually reversed in Fortnightly, holding that a CATV operator does not perform television broadcasts; instead, its “basic function the equipment serves is little different from that served by the equipment generally furnished by a television viewer.”5 So we know that the idea of a distinction between a service performing a work publicly and a service allowing an individual to perform a work privately was on Congress’s radar during the revision process. But it declined to insert any language that could potentially mediate that distinction. Rather, the public performance provisions would include all third parties, and “cover every transmission, retransmission, or other communication of a performance which reaches ”the public,” no matter how closely they resemble a mere provider of equipment for a user.6

To say otherwise, to suggest that language in the Copyright Act itself guides us to distinguish between a transmitter of performances and a mere passive device or process is supported by zero evidence. To say, after this clear and convincing evidence, that Congress drafted statutory language that would distinguish between companies performing a work to the public and companies merely providing facilities allowing members of the public to perform a work to themselves is untenable. Nothing in the final text of the provisions indicates that Congress intended this distinction, and nothing in the legislative history suggests that it buried such a distinction in the language, to await a clever lawyer to tease it out.

And this isn’t the case that Congress wasn’t aware of an argument that a service could argue it is just doing what users could otherwise do themselves. It heard that argument repeatedly.

Congress heard the argument that CATV equipment was “not owned by the CATV system but by the system’s individual subscribers.”7 Congress heard CATV operators argue that “Because CATV systems are functionally identical to rooftop antennas on private homes, broadcasters deserve no greater exclusivity than they would obtain if everyone chose to install a private rooftop antenna adequate to receive the available signals.”8 Congress heard that “CATV is not a passive rooftop or ‘rabbit-ear’ antenna.”9 CATV proponents argued to Congress that CATV is simply an “aid in reception of television broadcast signals”.10

And, driving home the point that this is not an issue of the Copyright Act being inadequate to deal with current technological challenges, the president of the NCTA argued nearly half a century ago that “The conventional way in which a viewer obtains programs is by buying his own set, installing his own antenna, and then enjoying the program. But the viewer may resort to other methods to enjoy his local station. If, instead of buying his set outright, the viewer chose to rent it from a company which agreed to keep it in good condition, there would be no reason in policy or logic why this act should bring into play different copyright consequences from those which obtain when the viewer owns his set outright.”11

Congress explicitly rejected—decades ago—the arguments Aereo and its supporters are currently making. As noted above, it ultimately settled on a broad statute that does not make the distinctions CATV proponents sought.

But, before consumer electronic advocates’ heads explode, I want to reiterate that this does not mean Aereo or similar services are necessarily liable for copyright infringement. It merely means that any possible salvation does not lie in the Copyright Act but in some other legal doctrine, whether through contract, tort, or otherwise.

General copyright principles would certainly inform the application of these legal doctrines, and the statutory text may serve as a guide, but the language itself does not answer the question of who is the “performer”.

So the Supreme Court’s job is clear. Assuming that Aereo is the performer, since that issue is not in front of the Court,12 it plainly is performing “to the public” because it is transmitting works using any device or process to individual subscribers that it has a public relationship with.

(I personally think proximate causation can play a critical role in the distinction discussed here and hope to explore this more fully in a future post.)

Thanks to Devlin Hartline for valuable feedback during the drafting process!

Footnotes

  1. U.S. Copyright Office, Supplementary Register’s Report on the General Revision of the U.S. Copyright Law (1965), []
  2. Id. []
  3. 255 F. Supp. 177 (SDNY 1966). []
  4. Judith E. Ciani, CATV and Copyright Infringement, 10 B.C.L. Rev. 459, 471-72 (1969). []
  5. Fortnightly Corp. v. United Artists Television, Inc., 392 US 390 (1968). []
  6. Supplementary Report, supra. []
  7. Statement of Louis Nizer, representing producers and distributors of copyrighted television film programs, Copyright Law Revision, Hearings before Subcommittee No. 3, pg. 1359, Serial No. 8 (1966). []
  8. Id. at 1298. []
  9. Statement of Arthur B. Krim, Hearings before Senate Judiciary IP Subcommittee on S.1006 at 170 (1966). []
  10. Fn. 7 at 1330. []
  11. Id. at 103. []
  12. And was not foreclosed by Cablevision in 2008. Cartoon Network LP v. CSC Holdings, 536 F. 3d 121, 134 (2nd Cir. 2008) (“We need not address Cablevision’s” argument “that (1) the RS-DVR customer, rather than Cablevision, does the transmitting and thus the performing”). []

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A Plea about Arts Piracy in the Theater — This week’s must read. “To put it another way, playwrights will only generate new plays insofar as they can afford to keep doing it, and only insofar as they know that the community is protecting their work even when they’re not around to police it.”

Copyright experts side with broadcasters in Aereo fight — This week, amici supporting broadcasters in ABC v. Aereo filed their briefs at the Supreme Court. Included among them was this one by copyright scholars David Nimmer and Peter Menell. Be sure to also check out the solidly written and well-reasoned brief from the US Copyright Office and DOJ as well as one taking the international perspective from a whopping 15 separate creative associations and eight IP scholars.

Guest post: Copyright’s Public Performance Right, Cable Television, and Aereo — Speaking of Peter Menell, I was delighted to see him contribute a version of his amicus brief argument to the Copyright Alliance’s blog.

Google Judge to Rule on Media Access to Documents after March 7 — Google is currently facing claims that it illegally accessed private emails. While the First Amendment normally requires court records be publicly accessible, Google has moved to seal certain documents filed in the lawsuit, arguing, in part, that “public disclosure of the Sealable Information would cause Google significant economic harm by revealing sensitive aspects of Google’s proprietary systems and internal decision-making processes to Google’s competitors, depriving Google of competitive advantages it has earned through years of innovation.” A group of media companies and organizations have intervened to oppose Google’s motion, a ruling of which can come as early as today.

Welcome to Googletown — This week’s feel good read.

The Oscar Selfie: Why Copyright Analysis Should Be Left To Copyright Lawyers — Some great perspective from Paul Fakler following the rash of silly and unnecessary copyright analysis of Ellen DeGeneres’ record-setting #selfie from Sunday’s Academy Awards. Speaking of which, The Ellen Selfie Was TV’s Victory, Not Twitter’s. “The Hollywood selfie seems like a giant business coup for ad-reliant Twitter, but it says more about the power of a century-old technology than anything else.”

Washington Attorney General Hits Cyberlocker for “Deceptive Practices” — An interesting new front opens in the fight against commercial exploitation of creators. According to Torrentfreak, “the AGO says that by failing to inform users that some of the content available from UMB may be copyrighted, UMB had engaged in ‘deceptive business practices’ contrary to the Consumer Protection Act. Furthermore, the AGO said that by charging a subscription fee to use the service, UMB had been ‘implicitly leading members to believe’ they were accessing content legally, something that was likely to confuse customers and lead them to unwittingly break the law.”

We’re being screwed by Spotify! David Byrne, R.E.M.’s Mike Mills and Cake’s John McCrea on the fight for artists’ rights — Cake frontman John McCrea speaks to Spotify about the reemerging artist rights movement.

The Echo Nest is Joining Spotify: What it Means to Me, and to Developers — “Today, we’ve announced that The Echo Nest has been acquired by Spotify, the award-winning digital music service. As part of Spotify, The Echo Nest will use our deep understanding of music to give Spotify listeners the best possible personalized music listening experience. Spotify has long been committed to fostering a music app developer ecosystem. They have a number of APIs for creating apps on the web, on mobile devices, and within the Spotify application. They’ve been a sponsor and active participant in Music Hack Days for years now. Developers love Spotify, because it makes it easy to add music to an app without any licensing fuss. It has an incredibly huge music catalog that is available in countries around the world. “

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Cross-posted on the Law Theories blog.

With Aereo’s upcoming oral argument before the Supreme Court, I’ve got tens of thousands of tiny antennae on the mind. The novelty—and, of course, the absurdity—of Aereo’s service makes it one of the more interesting copyright puzzles. Most of the issues with Aereo are repetitive of the issues with Cablevision, and debate abounds over whether the number of source copies matters and whether multiple transmissions should be aggregated. I’ve come to view these issues as red herrings. But there’s another red herring that I’d rather discuss here, and that’s whether a decision against Aereo would be the death knell to the cloud. After all, performances are transmitted from Aereo’s service to members of the public just like they are from some cloud computing services. So why shouldn’t we worry?

In my last post about Aereo, I unconcernedly claimed: “This case isn’t about the future of cloud computing companies—those services are protected by the DMCA.” Why we shouldn’t worry about the cloud is certainly in large part answered by the DMCA, but I want to take it a step deeper and show that, even without the DMCA, some cloud computing companies would not incur liability when content is transmitted from their services to members of the public. The key to understanding why such cloud computing companies are not infringers is the key to understanding why Aereo is an infringer, and this turns on application of the volitional conduct test—a test codified in DMCA, but which is applicable in any context where the Transmit Clause is implicated. The volitional conduct test provides us with a way to separate the Aereo-like goats from the cloud computing sheep.

Under the Transmit Clause, it is a public performance to (1) transmit a performance of a work (2) to the public.1 There is no doubt that a performance of a work is being transmitted with Aereo’s service, so (1) is not at issue. The issue is whether this transmission is “to the public,” which is a term of art. Whether a transmission is “to the public” does not depend on the place to which it is sent, and a transmission to a private place can be “to the public” nonetheless. What makes it “to the public” is the relationship between the sender and the receiver, and this relationship, naturally, depends on the identity of each party. When the relationship between the sender and the receiver is a public one, the transmission is a public performance. And when the relationship between the sender and the receiver is a private one, the transmission is a private performance.

In Aereo,2 the Second Circuit focused on the receiver for each transmission, concluding that when there is a one-to-one relationship between the source copy and the receiver, the performance is private—even if we presume that Aereo is the sender. I think this makes no sense. If Aereo is the sender and the subscriber is the receiver, then that relationship is a public one and the transmission is a public performance. The Second Circuit’s reliance on there being a unique source copy for each receiver was misplaced, for the Transmit Clause cares only about who is transmitting to whom. It says nothing about a source copy—and in fact no source copy is even needed to publicly perform via transmission.3 The issue is simply who is directly causing the transmission to occur. Until we know who is transmitting to the receiver, that is, until we identify the sender, we can’t know whether the relationship between the sender and the receiver is a public one such that it’s “to the public.”

Without fair use or the DMCA to fall back on, the Aereo appeal squarely presents the issue of who is directly causing the transmission when a performance of a work is transmitted from Aereo’s service to the subscriber. In other words, the case boils down to who is the direct performer in this scenario. If the subscriber is the direct performer, then the performance is private since the sender and the receiver are the same party and the transmission therefore is not “to the public.” If Aereo is the direct performer, then the performance is public since the relationship between the sender and the receiver is a public one and the transmission therefore is “to the public.” And whether Aereo is the direct performer turns on the volitional conduct test: Is Aereo’s volitional conduct sufficient such that it directly causes the transmission? I think the answer is clearly “yes,” and how I get there is by utilizing the only bright-line rule under the volitional conduct test.

The genesis of the volitional conduct test is the famous Netcom decision,4 penned in 1995 by District Judge Ronald M. Whyte of the Northern District of California. Pre-DMCA, Judge Whyte was faced with deciding the liability of Netcom, an internet service provider, for infringement taking place utilizing its system. Critically, “Netcom was not itself the source of any of the infringing materials on its system,”5 and the issue was whether it could be a direct infringer of the reproduction right nonetheless. Judge Whyte held that it could not: “Although copyright is a strict liability statute, there should still be some element of volition or causation which is lacking where a defendant’s system is merely used to create a copy by a third party.”6 Since “such copies are uploaded by an infringing user,” Judge Whyte continued, Netcom’s actions were not a direct infringement of the reproduction right.7

Judge Whyte acknowledged that copyright infringement is a strict liability tort, meaning that neither knowledge nor intent to infringe need be shown. However, strictly applying that strict liability to reproductions occurring in cyberspace “would hold the entire Internet liable for activities that cannot reasonably be deterred.”8 Grounded in the policy argument that “it does not make sense to adopt a rule that could lead to the liability of countless parties whose role in the infringement is nothing more than setting up and operating a system that is necessary for the functioning of the Internet,” Judge Whyte proposed a dichotomy between a passive conduit, which provides only dumb pipes used by others to copy, and an active participant, which takes affirmative steps to bring about the copying.9 And central to Judge Whyte’s holding that Netcom was a passive conduit was the fact that it was the users who uploaded the content to Netcom’s service in the first place.

The key to understanding Netcom and its progeny is to recognize that the volitional conduct test is not used to determine whether a service provider should be held directly liable in the first place. Instead, a service provider seeks Netcom immunity because, without it, it would otherwise be a direct infringer. The volitional conduct test is perhaps best understood in terms of causation: Even though, because of strict liability, every service provider that is the cause-in-fact of the copying is thereby a direct infringer, certain service providers are nevertheless not directly liable for the copying because their actions are sufficiently remote. Perhaps the leading iteration of the volitional conduct test comes from the Fourth Circuit in CoStar:

[T]o establish direct liability under §§ 501 and 106 of the Act, something more must be shown than mere ownership of a machine used by others to make illegal copies. There must be actual infringing conduct with a nexus sufficiently close and causal to the illegal copying that one could conclude that the machine owner himself trespassed on the exclusive domain of the copyright owner.10

The volitional conduct test has also been adopted by the Second and Ninth Circuits,11 as well as by several district courts.12 In fact, Congress baked Netcom immunity under the volitional conduct test right into the DMCA.13 For example, Section 512(c) grants a qualifying service provider immunity “for infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider.”14 The Second Circuit in YouTube and the Ninth Circuit in Shelter Capital read this language very broadly, finding that even transcoding and indexing user-submitted content to facilitate its public playback was protected by the safe harbor.15 While Section 512(c) protects a service provider for many automated acts that occur after a user uploads content to the service, the one thing it doesn’t provide immunity for is content supplied by the service provider itself.

How the volitional conduct test operates in the cloud is demonstrated in the Hotfile case, where the district court stated:

Thus, the law is clear that Hotfile and [the owner] are not liable for direct copyright infringement because they own and manage internet facilities that allow others to upload and download copyrighted material. . . . [T]he website hotfile.com merely allows users to upload and download copyrighted material without volitional conduct from Hotfile or [the owner]. . . . [N]othing in the complaint alleges that Hotfile or [the owner] took direct, volitional steps to violate the plaintiffs’ infringement. There are no allegations, say, that Hotfile uploaded copyrighted material. Therefore, under the great weight of authority, the plaintiffs have failed to allege direct copyright infringement.16

Because neither Hotfile nor the owner had engaged in sufficient volitional conduct, by, for example, uploading the infringing content at issue, the district court found that they could not be held directly liable for the infringement that occurred. Contrasted with Hotfile is Tasini,17 where the Supreme Court held that a database provider was directly liable for violating the public distribution right for content that it had supplied and made available as part of its publicly-accessible database. Because the database provider had supplied the infringing content at issue, this was a sufficient condition for finding that it was a direct infringer.

The import of all this is that where the service provider itself supplies the infringing content that is publicly distributed, displayed, or performed, that service provider can claim neither Netcom immunity nor DMCA immunity. Supplying the infringing content is sufficient for finding that the service provider has directly caused the infringement to occur—but it’s not necessary for such a finding. In other words, if the service provider itself supplies the infringing content, then it is a direct infringer. But sometimes the service provider can also be a direct infringer even if it did not supply the infringing content. This happens when the service provider engages in other volitional conduct “with a nexus sufficiently close and causal to the illegal copying,” to borrow the Fourth Circuit’s phrase, such that it is not only the factual cause of the copying, but the legal cause as well.

For example, in Megaupload, the district court found that the plaintiff had alleged that Kim Dotcom’s infamous website “serves as more than a passive conduit, and more than a mere ‘file storage’ company.”18 Several facts, including Megaupload’s reward program where it paid users to upload content, meant that Megaupload had possibly crossed the line from being a passive conduit to being an active participant in the infringement. Similarly, in Usenet, the district court found that the bulletin board service was “not merely a ‘passive conduit’ that facilitates the exchange of content between users who upload infringing content and users who download such content.”19 The “active measures” and “active steps” engaged in by the defendants “transformed [them] from passive providers of a space in which infringing activities happened to occur to active participants in the process of copyright infringement.”20

Like all proximate causation analysis, the volitional conduct test involves both art and science, and courts engaging in it typically juggle somewhat-vague concepts of foreseeability and temporality with normative decisions about social justice.21 As Dean William Prosser, author of Prosser on Torts and Reporter for the Restatement (Second) of Torts, put it, proximate causation is “our more or less inadequately expressed ideas of what justice demands.”22 Exactly how much volitional conduct it takes for a service provider to cross the line from passive conduit to active participant, no one can say. The analysis is, necessarily, somewhat arbitrary. The only bright-line criteria that exists under the volitional conduct test is that of who supplies the infringing content. When it’s the service provider itself, the volitional conduct on the part of the service provider is sufficient to find it directly liable.

This past week, District Judge Dale A. Kimball of the District of Utah found that the plaintiffs were likely to succeed on the merits against Aereo because it “provid[es] paying customers with retransmission of copyrighted works.” And this gets to the heart of why Aereo should lose before the Supreme Court. Aereo has crossed the line from being a passive conduit to being an active participant because it supplies the very content that is available using its service. Presumably, this is at least part of the reason why Aereo does not argue that Section 512(c) gives it DMCA immunity. Aereo cannot maintain that the content residing on its service is “by reason of the storage at the direction of a user” because the content comes from Aereo itself. The subscriber doesn’t go to Aereo to upload the content he already has to the cloud; the subscriber goes to Aereo to get the content he wants but doesn’t yet have—content which Aereo itself supplies.

The reason why Aereo, and not the subscriber, is the direct performer is simple. Because of copyright’s strict liability nature, every party that is the cause-in-fact of the copying is a direct infringer unless some other doctrine absolves that party from direct liability. The volitional conduct test uses a proximate causation analysis to determine whether a party’s actions are sufficiently remote such that it should not be held directly liable for the infringement. While the metes and bounds of the volitional conduct test are imprecise, to say the least, there is one bright-line rule: When the service provider itself supplies the very content at issue, that service provider’s actions can never be sufficiently remote to absolve it of direct liability. Because Aereo itself supplies the very content at issue—by implementing and making available its system of tens of thousands of tiny antennae that receive and retransmit performances—Aereo is the identity of the sender. And since the relationship between the sender (Aereo) and the receiver (the subscriber) is a public one, the transmission is a public performance.

The argument that it is Aereo’s subscriber, and not Aereo itself, who is the sender is untenable. The Transmit Clause was enacted to capture any service doing exactly what Aereo does, namely, retransmitting a broadcast to the public by any means possible. The petitioners in Aereo do a great job of traversing the history of the Transmit Clause in their opening brief before the Supreme Court, but the short version is this: The Supreme Court had held in a pair of cases that a community antenna television system or a cable system that captured an over-the-air broadcast and retransmitted it to the public was not engaged in a public performance.23 Congress enacted the Transmit Clause to legislatively overrule these two cases, and the words Congress chose, namely, “any device or process” used to transmit a performance, leave no doubt that its concern was with the function of the device or process utilized to make the transmission—not the underlying technical details of the device or process itself.24

Aereo’s argument boils down to it claiming that, even though the Transmit Clause on its face applies to “any device or process” that transmits a performance to the public, its particular device or process is somehow so special under-the-hood that the Transmit Clause doesn’t reach it. The problem with this argument is that the Transmit Clause means what it says, and it’s no answer to say that Aereo is simply doing for a subscriber what he could do for himself. This was the Supreme Court’s reasoning in the two cases the Transmit Clause was enacted to overrule. And even if we accept the argument that Aereo’s subscribers are really lessees of its equipment, the outcome is the same. The test is volitional conduct, and the conduct that matters is the conduct that Aereo itself has actually engaged in. If Aereo’s own actions are sufficient to find it directly liable absent any lease relationship, then its own actions are necessarily sufficient to find it directly liable even with the lease relationship. Because unless there is also some agency relationship between Aereo and its subscriber—for example, if Aereo were the subscriber’s employee—then Aereo’s own actions are only attributable to itself.

Cloud computing companies need not be worried about the outcome of the Aereo appeal because these service providers will continue to be protected by Netcom immunity under the volitional conduct test or by DMCA immunity. Assuming such service providers are protected by the DMCA, there’s an expansive amount of volitional conduct they can engage in without losing their safe harbor. How much volitional conduct they can engage in without losing Netcom immunity is less clear, but what is clear is that when a service provider itself supplies the very content at issue, there is no immunity under either the volitional conduct test or the DMCA. If Aereo loses before the Supreme Court, as I believe they should, it won’t negatively affect cloud computing companies because there is no reason for the Court to look any further than the fact that Aereo supplies the very content at issue. If anything, the Court’s decision will further cement into place the one bright-line rule that there is with the volitional conduct test, and this clarity in the law will redound to the cloud.

Special thanks to Terry Hart and Jonathan Greenfield for their valuable feedback in drafting this post.

Follow me on Twitter: @devlinhartline

Footnotes

  1. See 17 U.S.C.A. § 101 (West 2014) (“To perform or display a work ‘publicly’ means– (1) to perform or display it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered; or (2) to transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times. *** To ‘transmit’ a performance or display is to communicate it by any device or process whereby images or sounds are received beyond the place from which they are sent.”). []
  2. See WNET, Thirteen v. Aereo, Inc., 712 F.3d 676 (2d Cir. 2013). []
  3. For example, live performances and television broadcasts can be captured and transmitted to the public even though the sender possesses no source copy. []
  4. See Religious Tech. Ctr. v. Netcom On-Line Commc’n Servs., Inc., 907 F.Supp. 1361 (N.D. Cal. 1995). []
  5. Id. at 1367. []
  6. Id. at 1370. []
  7. Id. at 1371. []
  8. Id. at 1372. []
  9. Id. []
  10. CoStar Grp., Inc. v. LoopNet, Inc., 373 F.3d 544, 550 (4th Cir. 2004). []
  11. See Cartoon Network LP, LLLP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008); Fox Broad. Co., Inc. v. Dish Network L.L.C., Case No. 12-cv-57048, 2014 WL 260572 (9th Cir. Jan. 24, 2014). []
  12. See, e.g., Field v. Google Inc., 412 F.Supp.2d 1106 (D. Nev. 2006); Playboy Enterprises, Inc. v. Webbworld, Inc., 991 F.Supp. 543 (N.D. Tex. 1997); Playboy Enterprises, Inc. v. Russ Hardenburgh, Inc., 982 F.Supp. 503 (N.D. Ohio 1997); Disney Enterprises, Inc. v. Hotfile Corp., 798 F.Supp.2d 1303 (S.D. Fla. 2011). []
  13. See, e.g., H.R. Rep. 105-551(I), at *11 (“As to direct infringement, liability is ruled out for passive, automatic acts engaged in through a technological process initiated by another. Thus, the bill essentially codifies the result in the leading and most thoughtful judicial decision to date: Religious Technology Center v. Netcom On-line Communications Services, Inc., 907 F. Supp. 1361 (N.D. Cal. 1995).”); ALS Scan, Inc. v. RemarQ Communities, Inc., 239 F.3d 619, 622 (4th Cir. 2001) (“[T]he ultimate conclusion on this point is controlled by Congress’ codification of the Netcom principles in Title II of the DMCA.”). []
  14. 17 U.S.C.A. § 512(c) (West 2014). []
  15. See Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19, 39 (2d Cir. 2012); UMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1016 (9th Cir. 2013). []
  16. Disney Enterprises, Inc. v. Hotfile Corp., 798 F.Supp.2d 1303, 1308 (S.D. Fla. 2011) (internal citations and paragraph break omitted). []
  17. New York Times Co., Inc. v. Tasini, 533 U.S. 483 (2001). []
  18. Perfect 10, Inc. v. Megaupload Ltd., Case No. 11-cv-0191, 2011 WL 3203117, at *4 (S.D. Cal. July 27, 2011). vacated pursuant to settlement, 2011 WL 10618723 (S.D. Cal. Oct. 11, 2011). []
  19. Arista Records LLC v. Usenet.com, Inc., 633 F.Supp.2d 124, 149 (S.D.N.Y. 2009). []
  20. Id. (internal quotations, citations, and brackets omitted). []
  21. See Mark Bartholomew & Patrick F. McArdle, Causing Infringement, 64 Vand. L. Rev. 675, 703 (2011). []
  22. Id. (internal quotations and footnote omitted). []
  23. See Fortnightly Corp. v. United Artists Television, Inc., 392 U.S. 390 (1968); Teleprompter Corp. v. Columbia Broad. Sys., Inc., 415 U.S. 394 (1974). []
  24. See, e.g., H.R. Rep. No. 94-1476, at *63 (1976) (A performance occurs “either directly or by means of any device or process, including . . . any sort of transmitting apparatus, any type of electronic retrieval system, and any other techniques and systems not yet in use or even invented.”); id. at *64 (“The definition of ‘transmit’ . . . is broad enough to include all conceivable forms and combinations of wires and wireless communications media, including but by no means limited to radio and television broadcasting as we know them. Each and every method by which the images or sounds comprising a performance . . . are picked up and conveyed is a ‘transmission,’ and if the transmission reaches the public in [an]y form, the case comes within the scope of clause[] (4) . . . of section 106.”). []

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February 21, 2014 · · Comments Off

The political conflicts and ambitions of [Shakespeare's] England are known to the scholar and the specialist. But his plays will forever move men in every corner of the world. The leaders that he wrote about live far more vividly in his worlds than in the forgotten facts of their own rule.

Our civilization, too, will survive largely in the works of our creation. There is a quality in art which speaks across the gulf dividing man from man, nation from nation and century from century. …

[I]t is important to know that the opportunity we give to the arts is a measure of the quality of our civilization. It is important to be aware that artistic activity can enrich the life of our people; which is the central object of government. It is important that our material prosperity liberate and not confine the creative spirit.

—President Johnson, at the groundbreaking ceremony for the John F. Kennedy Center for the Arts on December 2, 1964.1

National Endowment for the Arts, Sunil Iyengar, on “Why The Arts Really Do Mean Business” — Check out this podcast with Copyright Alliance’s Sandra Aistars and National Endowment for the Arts Sunil Iyengar on the NEA’s recent report showing the arts and culture sectors contribute over half a trillion dollars to U.S. GDP and create nearly 2 million jobs.

‘Grindhouse’ to ‘John Carter’ – 18 ‘dream projects’ that turned into nightmares — An interesting article in its own right, though I was struck in particular by the author’s remarks that, “The best art comes from dealing with the limitations under which something is produced, and when all of those limitations are taken away, you can end up with something that is wall-to-wall indulgence.” and “The lesson to take away is that when you want to pay tribute to the guys who came before you, do it in a way like Lucas and Spielberg did with Indiana Jones. Take that energy and channel it into something of your own”

New report says how much advertising is going to piracy sites — $227 million in 2013. And, according to the report, a significant chunk of that is coming from dozens of “blue-chip advertisers”, major brands like “AT&T, Lego, and Toyota.”

‘House of Cards’ Searches on Google Turn Up Pirate Links as Top Results — Variety reports, “In a Google search for “Watch House of Cards” on Wednesday, the top two results were links to apparent pirate sites, couchtuner.eu and stream-tv.me.” That reminds me of the story about Charlie Chaplin entering a Charlie Chaplin look-alike contest and coming in third.

Utah Judge Gives TV Broadcasters an Injunction Against Aereo — Although the Supreme Court has already agreed to determine the liability of the internet streaming TV service, the Utah court heard and granted a motion to enjoin Aereo in a parallel proceeding. Said the judge, “Aereo’s retransmission of Plaintiffs’ copyrighted programs is indistinguishable from a cable company.”

Kim Dotcom raid warrants legal, Court of Appeals rules — Despite continual proclamations of innocence, Dotcom has done nothing but delay having his day in court. Here, a New Zealand court strikes down one such attempt.

Wikipedia: as accurate as Britannica? — A 2005 study has given rise to the gospel that Wikipedia is as accurate as Encyclopedia Britannica. Here, Andreas Kolbe points out the sharp limitations of that study. “Nicholas Carr put it this way: in limiting itself to topics like the ‘kinetic isotope effect’ or ‘Meliaceae’, which no one without some specialized understanding of the subject matter would even be aware of, the Nature survey played to Wikipedia’s strengths. Carr also established that the Nature ‘study’ was not actually an expert-written research article of the type that built the reputation of Nature, but a non-peer-reviewed piece of news journalism (a fact he confirmed with the piece’s author, Jim Giles).”

Footnotes

  1. As quoted in Copyright Law Revision Pt. 6, Supplementary Report of the Register of Copyrights on the General Revision of the U.S. Copyright Law: 1965 Revision Bill, xiv (1965). []

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February 14, 2014 · · Comments Off

How to photograph the Sochi Winter Olympics, as told by a pro — Sports photojournalist Adam Pretty describes what its like shooting the 2014 games. As a Getty Images photographer, Pretty also receives some help to capture the best moments. “Getty will have laid 20km of cable to create a state-of-the-art fiber optic network that will connect all the key photo positions inside the venues directly back to the Getty Images office in the Main Press Center. With the VLAN connections on the mountains, the photographers will be able to dump the contents of their memory cards onto their laptops, and they’ll automatically be back with the editor a minute or so later.”

Proposal for Compulsory Remix License Has Foes in Steven Tyler and Attorney Dina LaPolt — A post-deadline comment for the IPTF Green Paper proceedings on copyright policy from a number of music luminaries, including Aereosmith frontman Tyler, Don Henley, Sting, Ozzy Osbourne, Britney Spears, Deadmau5, and Joe Walsh takes on the idea of a compulsory license for remixes. Could this mean that attention to current copyright review discussions is starting to pick up?

Spanish box-office loses almost half of its audience over nine years — The Spanish film industry has almost completely crumbled in the past decade. Recently, the IIPA has also recommended to the USTR that Spain be placed on the Special 301 Watch List, noting “In stark contrast to so many of its neighbors in Western Europe, Spain suffers from unrelentingly high rates of digital piracy in every sector – music, film, videogames, software, and books.”

Pandora Suit May Upend Century-Old Royalty Plan — Few realize that ASCAP and BMI, organizations that collect public performance royalties for songwriters and music publishers, are limited in what they can do by an over 70 year old consent decree with the DOJ. Is it time for a change?

The Australian Law Reform Commission officially recommends adoption of fair use — The Australian Law Reform Commission (ALRC), an independent statutory body in Australia tasked with reviewing existing law and offering recommendations for reform, has dropped a 478 page report recommending the country repeals specific exemptions for, to name a few, personal copying and educational uses, and adopts a US-style fair use provision. Around 60% of ALRC recommendations are substantially implemented, while another 30% are partially implemented.1

The Day the Internet Didn’t Fight Back — Apparently repeating “SOPA” over and over is starting to lose its effectiveness.

Silicon Valley Needs to Lose the Arrogance or Risk Destruction — From Wired, no less. “It’s all adding up to a nasty picture of Silicon Valley—of an industry that hoovers up personal data and reaps massive profits from its use, preaching a gospel of sharing but refusing to share back.”

Footnotes

  1. Australian Law Reform Commission Annual Report 2011-12, pg. 30. []

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On January 24th, the Ninth Circuit denied a petition for rehearing en banc in Fox Broadcasting v. Dish Networks. The decision was, however, amended slightly from the original opinion, released last July.

Fox Broadcasting v. Dish Network involved satellite television provider Dish’s Hopper, a set-top device with digital video recording (DVR) and video on demand (VOD) capabilities. Relevant to this discussion, Dish began providing its Hopper customers with a service called “PrimeTime Anytime” (PTAT). PTAT, when enabled, automatically recorded all primetime (8 p.m.-11 p.m.) programming from the four broadcast networks (ABC, CBS, NBC, and Fox). The recordings are saved locally on a customer’s Hopper for a predetermined amount of time (typically 8 days), after which they are automatically deleted.

Fox sued for copyright infringement, alleging, in part, that Dish directly infringed its reproduction right when it made PTAT copies of Fox television programs. Fox sought a preliminary injunction

The District Court in Dish concluded that “at this stage of the proceedings, the Court is not satisfied that PTAT has crossed over the line that leads to direct liability. Despite Dish’s involvement in the copying process, the fact remains that the user, not Dish, must take the initial step of enabling PTAT after deciding that he or she wants to initiate the recording. The user, then, and not Dish, is the ‘most significant and important cause’ of the copy.” This, despite the fact that Dish designed, houses, and maintains the system that creates the copies. The court also did not consider the following facts indicative of causation:

  • “Dish decides which networks are available on PTAT and has defaulted the PTAT settings to record all four networks.”
  • “Dish also decides the length of time each copy is available for viewing: PTAT recordings are automatically deleted after expiration of a certain number of days, and a user may neither delete nor preserve the original PTAT copy before that time.”
  • “Dish decides when primetime recordings start and end each night, and it maintains the authority to modify those times according to the particular programs airing that night. Additionally, the user cannot stop a copy from being made during the copying process, but must wait until the recording ends before disabling the link.”

The Ninth Circuit affirmed this result, saying “the district court did not err in holding that Fox did not establish a likelihood of success on its direct infringement claim.”

The “volitional conduct” test relied upon by both courts is idiosyncratic within the larger contours of tort law, and neither court explains why it decided to extend the test so far beyond previous applications. I’ve detailed some criticisms of the opinion when the original decision was released last summer. But today I want to head overseas and look at a recent case where a court got it right.

TV Now

In 2012, an Australian court considered a very similar question. Telecom service provider Optus created “TV Now”, a service that enables customers to watch and record television broadcasts through a mobile device or personal computer. It was sued by a group of sports leagues for infringing its copyright in broadcast football games. The trial court judge held that Optus was not liable for infringement, relying in part on the US court decision in Cablevision and analogizing the service to a VCR or DVR. The decision was appealed.

The primary issue on appeal was “who ‘does’ the act of copying.” The appellate court said “the rival contenders are Optus, the subscriber, or Optus and the subscriber jointly.”

The court first considers the case that the copies were made solely by the subscriber. This approach is based on the premise that “Optus makes available to a subscriber a facility (a service) which enables the subscriber as and when he or she is so minded to use that facility to record broadcasts and later to view them. The copies that are made are the result of the subscriber’s use of the facility though the actual making of them requires Optus’ technology to function as it was designed to.” This is the position taken by the trial court judge, which said that to “make” a copy means “’to create’ by selecting what is to be recorded and by initiating a process utilising technology or equipment that records the broadcast”, a conception the court here said “robs the entirely automated copying process of any significance beyond that of being the vehicle which does the making of copies.”

Besides the analogy of Optus as a DVR operated by a subscriber, the trial court judge also saw the subscriber choosing to copy as “the last ‘volitional act’ in the sequence of acts leading to a copy being made and, for that reason, is significant in determining the identity of the maker.” The appellate court found these arguments less than compelling.

It noted too the trial court’s citation to Cablevision and the “volitional conduct concept.” However, the court viewed this concept as relevant only when there is a need to distinguish between direct and contributory liability—which is the case in U.S. jurisprudence but not under Australian law. The court added, referring to the academic criticism of the Cablevision decision, “It equally is not apparent to us why a person who designs and operates a wholly automated copying system ought as of course not be treated as a ‘maker’ of an infringing copy where the system itself is configured designedly so as to respond to a third party command to make that copy.”

The court concluded:

[W]e consider that Optus’ role in the making of a copy – ie in capturing the broadcast and then in embodying its images and sounds in the hard disk – is so pervasive that, even though entirely automated, it cannot be disregarded when the “person” who does the act of copying is to be identified. The system performs the very functions for which it was created by Optus. Even if one were to require volitional conduct proximate to the copying, Optus’ creating and keeping in constant readiness the TV Now system would satisfy that requirement. It should also be emphasised that the recording is made by reason of Optus’ system remaining “up” and available to implement the subscriber’s request at the time when its recording controllers poll the user database and receive a response indicating that a recording has been requested. What Optus actually does has –

a nexus sufficiently close and causal to the illegal copying that one could conclude that the machine owner … trespassed on the exclusive domain of the copyright owners: CoStar Group Inc v LoopNet Inc, 373 F3d 544 at 550 (4th Circ. 2004).

… Put shortly Optus is not merely making available its system to another who uses it to copy a broadcast. Rather it captures, copies, stores and makes available for reward, a programme for later viewing by another.

The real question for the court was whether Optus alone is liable or whether Optus and the subscriber are jointly liable. And here, the court indicated that the latter was most likely (since only Optus was named as a defendant, it was not strictly necessary for the court to resolve the question of the subscriber’s liability.) Said the court:

If one focussed not only upon the automated service which is held out as able to produce, and which actually produces, the copies but also on the causative agency that is responsible for the copies being made at all, the need for a more complex characterisation is suggested. The subscriber, by selecting the programme to be copied and by confirming that it is to be copied, can properly be said to be the person who instigates the copying. Yet it is Optus which effects it. Without the concerted actions of both there would be no copy made of a football match for the subscriber. Without the subscriber’s involvement, nothing would be created; without Optus’ involvement nothing would be copied. They have needed to act in concert to produce – they each have contributed to – a commonly desired outcome. The subscriber’s contributing acts were envisaged by the contractual terms and conditions. How they were to be done were indicated by the prompts given on the Optus TV Now TV guide page. The common design – the production of the selected programme for transmission to the subscriber – informed the solicitation and the taking of a subscription by the subscriber; it was immanent in the service to be provided.

The Australian court’s conclusion seems to hew more closely to general principles of tort law. Though the issue is settled, for now, in the Ninth Circuit, the Second Circuit is set to take up the issue soon in a parallel case involving the same Dish services and the other three major broadcast networks. Last October, the Southern District Court of New York denied a preliminary injunction against Dish in part because it agreed that the customer, not Dish, made the PTAT copies. That decision has been appealed, and oral arguments are set for next week.

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Previously, I began looking at the legal questions involved in American Broadcasting Companies v. Aereo, currently in front of the Supreme Court. The issue is whether Aereo, by providing a service that allows paying subscribers to watch broadcast television online, is publicly performing the copyrighted programming. The Second Circuit said it is not, based on its 2008 decision in Cablevision, which held that a transmission from a unique copy of a work is merely a private performance. Aereo, relying on the Cablevision decision, designed its service to purportedly assign a unique antenna to each individual subscriber.

The Copyright Act states that to perform a work publicly means, in relevant part, “to transmit or otherwise communicate a performance … of the work … to the public, by means of any device or process, whether the members of the public capable of receiving the performance … receive it in the same place or in separate places and at the same time or at different times.”

The seemingly straightforward language belies some of the complexities that result, as evidenced by the Supreme Court’s agreement to hear Aereo. The approach I began in my previous post was to break the definition up into its separate components to understand it better: we have an actor (otherwise unnamed in the Act, we can refer to this as a “performer”), the action (“to transmit or otherwise communicate”), the object (“a performance of the work”), and a prepositional phrase (“to the public”).

To the public redux

I first took a look at what “to the public” means. Having had the opportunity to consider some of the feedback I’ve received on the article, I do want to make a slight modification to my definition.1

Originally, I wrote, “Any transmission from one person to another person who is not a family member or a close social acquaintance is a public performance.” The mention of family members and social acquaintances invites a level of specificity that I did not intend and distracts from the original purpose, which is to focus on the relationship between performer and audience. The legislative history of the Copyright Act says that under the second clause of the definition of “publicly”, performances during “routine meetings of business and governmental personnel” would be exempt “because they do not represent the gathering of a ‘substantial number of persons.’” I think the definition of “to the public” should similarly exempt such performances. It seems it would be more accurate to step back one level of abstraction; rather than referring to family members and social acquaintances, we should refer to “public” and “private” relationships. “Public” relationships are those that tend to be described as commercial, arms-length, or impersonal, and are strongly unidirectional, while “private” relationships tend to be described as familial, social, or collegial, and are much more reciprocal in nature.

What is a performance?

With that out of the way, we can turn to the next question in the analysis: what is a performance?

As with “to the public”, “performance” is not directly defined in the Copyright Act. But the Act does define the act of performing:

To “perform” a work means to recite, render, play, dance, or act it, either directly or by means of any device or process or, in the case of a motion picture or other audiovisual work, to show its images in any sequence or to make the sounds accompanying it audible.2

A performance right for dramatic compositions first appeared in US copyright law in 1856.3 Nondramatic musical works gained a performance right in 1897,4 and the 1909 Copyright Act, the last general revision before the current Copyright Act, provided performance rights for dramatic works, nondramatic literary works, and musical compositions. However, the current Copyright Act is the first to actually define “perform.”

Though the current Copyright Act did not become law until 1978, the language of the definition for performance is substantially the same as the definition included in the 1965 version of the bill.5 Following the introduction of that bill, the US Copyright Office released a report explaining the bill in detail. The Supplementary Report explained:

Under clause (1) of section 106(b), to ”perform” a work means ”to recite, render, play, dance, or act it.” This includes, for example, the reading aloud of a literary work, the singing or playing of music, the dancing of a choreographic work, and the acting out of a dramatic work or pantomime. A work may be performed ”either directly or by means of any device or process,” and these devices or processes would encompass sound or visual reproduction equipment of all kinds, amplifying systems, radio and television transmitting and receiving apparatus, electronic retrieval devices, and a host of other techniques, undoubtedly including some not invented yet. In the case of a motion picture, performance would mean ”to show its images or to make the sounds accompanying it audible.” It would be clear under this language that the purely aural performance of a motion picture sound track would constitute a performance of the motion picture; but, if the sounds on the soundtrack are reproduced on an authorized phonorecord, performance of the phonorecord would not be a performance of the motion picture.

The definition is relatively clear, and there are very few cases that have have been confronted with issues relating to its interpretation. One of the most relevant and thorough is US v. ASCAP.6 There, the court was tasked with considering whether a download of a music file was a performance. It looked at the “ordinary sense” of the words used in the Copyright Act’s definition of performance and concluded that performance requires “contemporaneous perceptibility.” Said the Second Circuit:

The downloads at issue in this appeal are not musical performances that are contemporaneously perceived by the listener. They are simply transfers of electronic files containing digital copies from an on-line server to a local hard drive. The downloaded songs are not performed in any perceptible manner during the transfers; the user must take some further action to play the songs after they are downloaded. Because the electronic download itself involves no recitation, rendering, or playing of the musical work encoded in the digital transmission, we hold that such a download is not a performance of that work, as defined by § 101.

In other words, “Transmittal without a performance,” said the Second Circuit, “is not a ‘public performance.’”

Transmission without performance

As support for this proposition, the court cited to Columbia Pictures Indus. v. Prof’l Real Estate Investors.7 In Columbia, the operators of a hotel resort offered guests the ability to rent movies on videocassette at the front desk, which they could watch on hotel-provided equipment in their own rooms. Plaintiffs sued, relying on the Third Circuit’s line of cases holding video store operators liable for public performance for operating private viewing booths on their premises.8 The Ninth Circuit, however, rejected this argument, holding that hotel rooms, though offered to the general public, become private spaces once they are rented.9 Thus, the operation of the equipment is not a performance in a public place.

Plaintiffs, however, also argued that the act of providing videocassettes to hotel guests implicated the Transmit Clause because the hotel was “otherwise communicat[ing]” the films. The Ninth Circuit rejected this argument as well.

A plain reading of the transmit clause indicates that its purpose is to prohibit transmissions and other forms of broadcasting from one place to another without the copyright owner’s permission. The Act provides a definition of “transmit.” “To `transmit’ a performance or display is to communicate it by any device or process whereby images and sounds are received beyond the place from which they are sent.” According to the rule of ejusdem generis, the term “otherwise communicate” should be construed consistently with the term “transmit.”  Consequently, the “otherwise communicate” phrase must relate to a “process whereby images or sounds are received beyond the place from which they are sent.”

This reading is reinforced by the rest of the transmit clause which refers to the use of transmission devices or processes and the reception by the public of the performance. Devices must refer to transmission or communication devices, such as, perhaps, wires, radio towers, communication satellites, and coaxial cable, while reception of the performance by the public describes acts, such as listening to a radio, or watching — network, cable, or closed-circuit — television “beyond the place” of origination.

In sum, when one adds up the various segments of clause (2), one must conclude that under the transmit clause a public performance at least involves sending out some sort of signal via a device or process to be received by the public at a place beyond the place from which it is sent.

Nothing that La Mancha has done has violated this common sense construction of the transmit clause. While La Mancha has indeed provided the videodisc player, television screens, guest rooms, and makes videodiscs available in the lobby, we are not persuaded that any transmission of the kind contemplated by the statute occurs. If any transmission and reception occurs, it does so entirely within the guest room; it is certainly not received beyond the place from which it is sent. We are not persuaded that the term “otherwise communicate” can be read so broadly as to include the videodisc arrangements at La Mancha.

The reasoning of the Ninth Circuit here and the Second Circuit in ASCAP seems sound.10

To perform a work includes the transmission of a contemporaneously perceptible rendition of the work and is distinguished from the delivery of a work, including electronic delivery via transmission.11

The nature of a performance

A “performance of a work”, then, follows from this definition. If “performing” means rendering a work so that it is contemporaneously perceptible, a “performance of a work” is something that is contemporaneously perceptible. It is intangible—the Copyright Act refers to the tangible objects that embody works as copies. It is conceptual, an act rather than a thing.12 A performance is not the actor on stage, nor the sound waves emanating from a speaker, nor the photons transmitted across fiber optic data lines.13

It is also, perhaps, worth pointing out that it is not a performance that is embodied in a copy but a work.14 A performance is, by definition, incapable of embodiment; indeed, one does not even need a copy to perform a work, as is the case of a singer singing from memory.

And it is a conceptual unity. Consider two members in an audience. Neither will be perceiving the exact same thing, both because they are in different locations and because they themselves have variations in their eyes and ears that shape their personal perception. But conceptually there is only one performance of the work, and it is exactly the same for each audience member for copyright purposes.

The same holds true if a performance reaches its audience via transmission rather than via sound and light waves through the air. The Central District Court of California explains why in its decision enjoining FilmOnX (then “BarryDriller”):

The definition section sets forth what constitutes a public performance of a copyrighted work, and says that transmitting a performance to the public is a public performance. It does not require a “performance” of a performance. The Second Circuit buttressed its definition with a “cf.” to Buck v. Jewell-La Salle Realty Co., 283 U.S. 191, 196 (1931), which interpreted the 1909 Copyright Act’s provision of an exclusive right to publicly perform a musical composition and held that “the reception of a radio broadcast and its translation into audible sound” is a performance. But Buck, like Cablevision and this case, was concerned with a copyright in the work that was broadcast. The Supreme Court was not concerned about the “performance of the performance” – instead, it held that using a radio to perform the copyrighted song infringed the exclusive right to perform the song (not to perform the performance of the song).

The Transmit Clause explicitly recognizes this conceptual unity, saying a work is performed publicly when it is transmitted even if “the members of the public capable of receiving the performance … receive it in the same place or in separate places and at the same time or at different times.” There could be thousands of separate transmissions, but there is still only the performance.

These may seem like inconsequential distinctions, but I think they undermine even more the Second Circuit’s notion that we can conceptually sever performances of the same work made by the same actor but from distinct copies. If the Transmit Clause spoke about the audience capable of receiving the physical transmission, as the Second Circuit says it does, then it would be possible to have multiple private performances since physical transmissions are discrete and separable. But it doesn’t—the Transmit Clause speaks about the audience capable of receiving the “performance of a work”, which remains a conceptual unity no matter how scattered the audience is.15

This interpretation of performance is, in my opinion, far more consonant with the statutory language and the ordinary use of the terms than the Second Circuit’s “unique copies” interpretation. It also means, as we’ll see in the next installment of this series, that most of the heavy lifting (at least for issues arising in the cloud computing context) occurs in the causation inquiry, i.e., “who is the performer”?

Footnotes

  1. I also flubbed when I referred to the three situations as being “mutually exclusive”. What I meant instead is that each situation excludes the previous. For example, a “place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered” could include a place open to the public, but that would make the previous clause redundant. Similarly, the last clause, transmission to the public, could include transmission to the public in a public place, or transmission to a place where a substantial number of persons is gathered, but that would make the previous two clauses redundant.

    I think it still follows that each situation is analyzed by exclusive means. We can presume (from the case law) that a “place open to the public” turns on the nature of the place. The “place where a substantial number of persons…” situation doesn’t turn on the nature of the place: if such a place were public, then the first situation covers it, while being a private place is insufficient to tell us if there are a substantial number of persons there. The same holds true for the last situation. The nature of the place is irrelevant (otherwise the first clause would be redundant), the size and relationship of the audience to each other is irrelevant (otherwise the second clause would be redundant). So what is there left to consider? The only thing I can come up with is the relationship between the performer and the audience. There could be others I am not aware of, but the relationship between performer and audience seems to provide a workable rule consistent with the Copyright Act’s structure and purpose. []

  2. 17 U.S.C. § 101. []
  3. Act of August 18, 1856, 34th Cong., 1st Sess., 11 Stat. 138. []
  4. Act of January 6, 1897, 44th Cong., 2d Sess., 29 Stat. 694. []
  5. H.R. 4347 and S. 1006, 89th Cong. []
  6. 627 F. 3d 64 (2nd Circuit 2010). []
  7. 866 F.2d 278, 282 (9th Cir. 1989). []
  8. Columbia Pictures Industries v. Redd Horne, 749 F.2d 154 (3d Cir.1984); Columbia Pictures Industries, Inc. v. Aveco, Inc., 800 F.2d 59 (3d Cir.1986). []
  9. In support of this conclusion, the court relied on Fourth Amendment case law holding that hotel guests have constitutional protection from unreasonable searches and seizures in hotel rooms. []
  10. And indeed, the Copyright Office’s 1965 Supplementary Report adds support.

    In general the concept of ”performance” must be distinguished sharply from the reproduction of copies on the one hand and the exhibition of copies on the other. It has been suggested that some of the internal operations of a computer, such as the scanning of a work to determine whether it contains material the user is seeking, is closely analogous to a ”performance.” We cannot agree, and for this reason we deleted from the definition of ”perform” the ambiguous term ”represent” which appeared in the 1964 bill. A computer may well ”perform” a work by running off a motion picture or playing a sound recording as part of its output, but its internal operations do not appear to us to fall within this concept. []

  11. Thus, uploading of a work to a web site, like downloading, is not a performance. []
  12. performance“, Merriam-Webster Online, “an activity (such as singing a song or acting in a play) that a person or group does to entertain an audience”. []
  13. “Very few people gather around their oscilloscopes to admire the sinusoidal waves of a television broadcast transmission. People are interested in watching the performance of the work.” Fox Television Stations v. BarryDriller, at 5 (C.D. Cali December 27, 2013). []
  14. Congress separately and outside the Copyright Office has made it a criminal offense to fix, without authorization, a live musical performance in a copy, thus underscoring this distinction. See 18 U.S.C. § 2319A. []
  15. Likewise, the Transmit Clause does not speak about “the potential audience of a particular ‘work’,” an alternative interpretation that the Second Circuit raises and dismisses. []

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