Balancing the Scales: Expanding the Family Movie Act to Protect Consumers After Clean Flicks of Colorado, LLC v. Soderbergh – Note by Joel M. Purles

From Volume 81, Number 2 (January 2008)
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In July 2006 the District Court of Colorado released its Memorandum Opinion and Order for the case Clean Flicks of Colorado, LLC v. Soderbergh. The decision stands as the culmination of events that included accusations, finger-pointing, judicial appeals, massive impleadings, academic debates, congressional hearings, and even statutory intervention. The specific issue that the court faced, which is still under discussion today, was whether companies that edit consumers’ personal copies of motion pictures for moral content infringed the movie studios’ copyrights. Although much of mainstream America was likely unaware of either the case’s existence or outcome, the court’s decision has the potential to affect many Americans because it directly impacts the broader question at issue: whether a proper balancing of copyright interests should recognize and protect consumers’ right to control the way that they experience movies in the privacy of their own homes.


 

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A Little Help with Sharing: A Mandatory Licensing Proposal to Resolve the Unanswered Questions Surrounding Peer-to-Peer Liability for Contributory Copyright Infringement in the Wake of Grokster – Note by Julie Zankel

From Volume 80, Number 1 (November 2006)
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In June 2005, the Supreme Court held that the peer-to-peer (“P2P”) networks Grokster and Streamcast1 could be held liable for contributory copyright infringement upon a showing that network administrators clearly expressed support for or took other affirmative steps to encourage infringement. In the Supreme Court’s only prior holding on the issue of secondary liability, Sony Corp. of America v. Universal City Studios, Inc., the Court established that a manufacturer could not be held liable for contributory infringement if the device was “capable of substantial noninfringing uses.” In Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., the Court focused on the networks’ culpable conduct-relying on an inducement theory-and came to a conclusion that would allow the lower court to find Grokster liable on remand without resolving the current circuit split on the issue4 or rethinking or reinterpreting its prior holding in Sony. This ruling essentially overturned the Ninth Circuit’s holding that Grokster was not liable for its users’ infringement merely by virtue of the fact that the system also had substantial noninfringing uses. The Grokster Court instead held that the Sony doctrine did not foreclose the possibility that an actor could be liable for contributory infringement, even if the device is capable of substantial noninfringing uses, when there is evidence the actor encouraged and induced illegal use of the product.

Thus, while it is now clear that a P2P network that encourages infringing uses of its product can be liable for contributory copyright infringement, the extent of liability for a network that does not actively induce users to infringe copyrights where the system is capable of both infringing and noninfringing uses remains uncertain. Further, the Grokster decision is not instructive as to what exactly inducement entails. While the Court was adamant that Grokster’s actions amounted to inducement in the present case, it gave no explanation regarding what actions a network would have to take to be considered “intentionally inducing… infringement,” or alternatively what a network would have to do to avoid inducing infringement on a system capable of both infringing and noninfringing uses. This lack of clarity is of particular importance considering the growing popularity of these types of networks. P2P networks, in particular, are increasingly being used by universities, government agencies, corporations, libraries, and other organizations. Exchange over P2P networks is not limited to music (the digital files at issue in Grokster), but includes motion pictures, novels, videogames, television programs, and photographs.8 In addition, as digital technology rapidly advances, it will be feasible to disseminate more and more types of copyrighted and uncopyrighted works through P2P networks “with ever greater speed and efficiency.”

Further, considering the amount of money that is at stake (Grokster, for example, agreed to “pay up to $50 million in damages”), it is extremely important that P2P networks have some sense of their potential liability in a case where no inducement exists, and what they could and should do to avoid such liability. The Grokster opinion is not instructive on this point, and this is exactly where the two concurring opinions diverge. Justice Ginsburg’s concurring opinion seems to imply that, had there been no “inducement,” a network such as Grokster would still fail the Sony test. On the other hand, Justice Breyer’s concurrence maintains that without culpable intent, a network such as Grokster should not be liable for contributory copyright infringement.

Prior to the Grokster case, both the Ninth Circuit and the Seventh Circuit confronted contributory copyright liability issues in A&M Records, Inc. v. Napster, Inc. and In re Aimster Copyright Litigation, respectively. Although in both cases the defendants were found liable for the infringement of their users, due to the unclear standard set forth in Sony, these two courts came to divergent conclusions in their analysis with respect to the circumstances under which contributory liability should and could be imposed. While the Ninth Circuit focused on whether the defendant had actual or constructive knowledge of the infringement and subsequently failed to act to curb the infringing activity, the Seventh Circuit concentrated on whether the device was actually used for noninfringing purposes. The Seventh Circuit interpreted Sony to further require that even where noninfringing uses exist, the network provider must demonstrate it would have been disproportionately costly to design the server or monitor the network in a way that would eliminate or reduce the infringing uses in order to escape liability. 

This debate regarding issues surrounding secondary liability is one that must be resolved quickly. Clarification of the Sony rule is necessary to encourage legitimate P2P networks by ensuring that networks are fully informed of the extent of their potential liability. Without a resolution, servers will have no way to determine their liability or know what reasonable steps should be taken to avoid such liability. The Grokster majority avoided this question by basing its decision on an inducement theory-arguing this would enable copyright owners to protect themselves while keeping the Sony rule intact so as not to chill innovation. The lack of guidance in the Grokster decision, however, could itself chill innovation as it will lead P2P network providers to take economically inefficient steps to avoid liability, disallow uses on their servers even though the uses would not infringe and might further education or some other important goal, or completely abandon their networks in favor of something less risky.

This Note will argue that the best way to resolve this conflict is through a mandatory licensing scheme that puts the burden on the content industry rather than the technology provider to track the use of protected works and petition the service provider for a reasonable royalty.


 

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Copyright and Incomplete Historiographies: Of Piracy, Propertization, and Thomas Jefferson – Article by Justin Hughes

From Volume 79, Number 5 (July 2006)
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Because we learn from history, we also try to teach from history. Persuasive discourse of all kinds is replete with historical examples – some true and applicable to the issue at hand, some one but not the other, and some neither. Beginning in the 1990s, intellectual property scholars began providing descriptive accounts of a tremendous strengthening of copyright laws, expressing the normative view that this trend needs to be arrested, if not reversed. This thoughtful body of scholarly literature is sometimes bolstered with historical claims – often casual comments about the way things were. The claims about history, legal or otherwise, are used to support the normative prescription about what intellectual property law should be.

One normative approach to arrest the growing strength of copyright has been through “constitutionalizing” copyright. This approach produced meaty theoretical ideas with practical implications, but failed to capture the judicial imagination and largely ran aground on the Eldred v. Ashcroft and MGM Studios Inc. v. Grokster, Ltd. decisions. In contrast to this constitutional critique, many legal scholars have recently written about the increasing “propertization of intellectual property” – this is both a descriptive account and a normative critique that describes recent developments as unwisely moving copyright toward a property paradigm. Whereas the constitutional critique of copyright provided specific prescriptions, the propertization critique may now be cresting because it has failed to present clear alternatives to what it criticizes and, in some sense, the critique boils down to one of intellectual life’s most familiar lessons: be careful that the terminology you use does not become the master of your thinking process.


 

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Free the Music: Rethinking the Role of Copyright in an Age of Digital Distribution – Note by David Nelson

From Volume 78, Number 2 (January 2005)
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“We are at a moment in our history at which the terms of freedom and justice are up for grabs.” Every major innovation in the history of communications – the printing press, radio, telephone – saw a brief open period before the rules of its use were determined and alternatives were eliminated. “The Internet is in that space right now.”

The technology of the Internet has revolutionized communication and information distribution throughout the world. The direction of this revolution, however, will be determined in large part by how the law chooses to regulate this new medium.

Currently, one of the most important debates over the Internet involves the future of copyright law. The outcome of this debate will likely determine whether, as Stanford Law School Professor Paul Goldstein argues, property rights will extend “into every corner in which people derive enjoyment and value from literary and artistic works” with “a price tag attached to each use,” or whether, as Thomas Jefferson advised, ideas will “freely spread from one to another over the globe.”

This Note examines the issue of copyright as it pertains to recorded music and demonstrates that copyright protection for recorded music can no longer be justified as necessary for the promotion of artistic creation.


 

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Too Many Markets or Too Few? Copyright Policy Toward Shared Works – Article by Michael J. Meurer

From Volume 77, Number 5 (July 2004)
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The lawfulness of sharing copyrighted works has always been contested, but never so hotly as it is today. The marriage of digital technology and information products creates remarkable opportunities for digital file-sharing, and new disputes asking when copyright law should give copyright owners control over sharing of copies of their works. This Article broadens the terms of the sharing debate by recognizing that file-sharing is just one member of a diverse set of sharing behaviors that occur in copyright protected markets. Books and recorded movies are shared by lending – books are lent by public libraries at no charge, while movies are rented for a fee. Owners of copyrighted works often share their copies by performing them for an audience. The audience might be children listening to a bedtime story, friends watching a recorded movie together, patrons at a bar listening to recorded music, and so forth. Finally, users share many sorts of works via private reproduction using computers, video and audio recorders, photocopiers, and scanners.

Copyright law specifies a mixed pattern of rights over sharing. Copyright owners have worked effectively to exert control over many forms of sharing, but powerful business groups have defended users’ sharing rights as a means of increasing their profit. The two sides have wrestled in Congress and the courts over the scope of various copyright provisions, especially the fair use doctrine, the main arena for conflict over sharing rights and the main focus of this Article. 


 

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Underground Appeal: A Sample of the Chronic Questions in Copyright Law Pertaining to the Transformative Use of Digital Music in a Civil Society – Note by Chris Johnstone

From Volume 77, Number 2 (January 2004)
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Throughout the 1970s, the Bronx borough of New York City was perceived as a microcosm of desolate American urban hopelessness. Within this economically barren wasteland, the city’s culture cultivated a colorful new form of musical art, organically sown from the seeds of the past. What was born as a fringe musical movement has evolved into an American cultural mainstay. Today, hip-hop music experiences tremendous mainstream success, both as a credible art form and as a business. Yet the success and proliferation of this genre has largely relied on the use of samples of past funk, rock, and soul compositions.

Copyright law was established as a mechanism for the promotion of innovation. In the realm of digital sampling, however, its role remains somewhat unclear. It is obvious that unauthorized copying of original compositions should be unlawful, but the extent of this protection remains a doctrinally elusive concept when applied to small or manipulated fragments of music. Specifically, the issue of digital sampling suffers from a lack of clear judicial guidance. Although sampling can clearly be translated into standard copyright doctrine, its exact fit has yet to be definitively declared by the judiciary. District courts have only sporadically tackled the topic, deterring potential litigants who fear the consequences of inconsistent doctrinal application.

This Note will look at the issue of digital sampling through the lens of recent commentary that suggests that copyright law exists, in large part, for the purpose of reinforcing democratic principles such as informed debate, pluralism, and civic participation. It will attempt to unravel the tangled doctrine regarding digital sampling to demonstrate the pitfalls of the present regime, and will later suggest more appropriate guidelines for the recording industry that will minimize unnecessary fees and eliminate deadweight economic loss.


 

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Copyright Law and Free Speech After Eldred v. Ashcroft – Article by Michael D. Birnhack

From Volume 76, Number 6 (September 2003)
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Eldred v. Ashcroft, as decided by the Supreme Court in January 2003, added another chapter regarding the relationship between copyright law and freedom of speech to the judicial “chain novel” that has been in the writing for the past three decades. The Court affirmed the constitutionality of the Sonny Bono Copyright Term Extension Act of 1998 (“CTEA”), which extended the copyright term by twenty years, both for existing works and for new works. As in previous chapters, the Court reached the conclusion that there is no conflict between the two legal fields. It repeated the judicial sound bite that “the Framers intended copyright itself to be the engine of free expression.” Eldred nicely fits the conflict discourse, which is mostly one of denial. But Eldred also included novel and interesting elements that offer a new direction to the conflict discourse, or at least a potential for redirection.

Eldred raises many intriguing copyright law and constitutional law questions. Here, however, I wish to focus on the possible ramifications the case might have on the conflict discourse with respect to its constitutional level. Surprisingly, Eldred is the first facial constitutional challenge to copyright law in 213 years. As copyright law continues to expand into new territories and in unpredictable ways, and as new bills are introduced at a staggering rate to further the scope of the rights of copyright owners, it is crucial that we study the contours of copyright law. This need is especially acute in light of the Court’s comment that “[w]hen, as in this case, Congress has not altered the traditional contours of copyright protection, further First Amendment scrutiny is unnecessary.”

In this Article, I wish to challenge the constitutional dimension of the judicial rejection of the conflict argument, which concerns the conflict between copyright law and the First Amendment. I will structure the critique along the lines of an important distinction. When we pause and ask what it is that the courts have been denying in rejecting the conflict argument, we see, after close study of over thirty cases that addressed the conflict argument, that, surprisingly, courts reject different things at different points. This leads us to identify two kinds of conflict: one is internal to copyright law, and the other is external to it. These two conflicts derive, respectively, from an internal view of the relationship of copyright law and free speech, and also from an external view.


 

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Copyright Law As a Silencing Restriction on Noninfringing Materials: Unveiling the Scope of Copyright’s Diversity Externalities – Article by Guy Pessach

From Volume 76, Number 5 (July 2003)
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The main argument presented in this Article is that the harms and social costs of copyright cannot be summarized just in terms of enclosure and exclusion. Copyright law, I will argue, also has a silencing effect toward noninfringing creative materials of other independent creators and producers.

Recent scholarly work has emphasized copyright’s “dynamic effect,” that is, the ongoing influence of expansive copyright protection toward an enclosure of the creative commons, and diminishment of cultural diversity. On the whole, however, this broad approach regarding the social cost of copyright in terms of diversity has focused only on instances and frameworks of creative activity in which a secondary author wishes to make use of existing copyrighted material, while a copyright owner (often a media conglomerate) imposes obstacles and limitations against such a use.

The argument presented in this Article goes one step further in exploring the nexus of copyright and diversity. As I will show, an expanded copyright regime diminishes diversity in a more intrusive manner. Extensive copyright protection also has a chilling effect on the variety and diversity of creative works that are both noninfringing and not affiliated to copyright portfolios, or to the communicative activity, of commercialized corporate media. This outcome derives from the advantages extensive copyright protection affords to excessive exposure of corporate media’s creative materials, as well as to the economic and cultural dominance of these media products.


 

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