Alain Strowel - Peer-To-Peer File Sharing and Secondary Liability in Copyright Law (2009) (A)
Alain Strowel - Peer-To-Peer File Sharing and Secondary Liability in Copyright Law (2009) (A)
Peer-to-Peer File
Sharing and Secondary
Liability in Copyright
Law
Edited by
Alain Strowel
Professor, Facults Universitaires Saint-Louis, Brussels and
University of Lige, Avocat, Belgium
Edward Elgar
Cheltenham, UK Northampton, MA, USA
Contents
List of contributors
Table of cases
6
7
vi
x
Index
12
43
71
110
124
148
196
229
305
Contributors
Graeme W. Austin is the J. Byron McCormick Professor of Law at the
University of Arizona. He holds a J.S.D. and LL.M. from Columbia
University and is a graduate of Victoria University of Wellington. Born in
New Zealand, where he practiced commercial law and was a senior lecturer
at the University of Auckland, his work focuses on cross-border intellectual
property issues. He recently served as advisor to the American Law Institute
Project on Intellectual Property, Principles Governing Jurisdiction, Choice
of Law, and Judgments in Transnational Disputes, and is co-author of
International Intellectual Property: Law and Policy (2nd ed.). He also
teaches regularly as a visiting professor at the University of Melbourne,
Australia.
Robert Clark is an Associate Professor of Law at the School of Law,
University College Dublin. Since 1992, he has been the Irish national representative in the European Commission Copyright Experts Group and is a
member of the Irish governments Internet Advisory Board and the Patent
Office Users Council. He is the founder and chair of the Irish ALAI group
(1996). Since 1999, Robert has been employed as a consultant to the leading
Irish law firm Arthur Cox where he specialises in intellectual property and
information technology law. He is the co-author (with Shane Smyth) of
Intellectual Property Law in Ireland, now in its second edition, and is the
author of Irish Copyright and Design Law, both of which are currently
published by Tottel.
Graeme B. Dinwoodie is Professor of Law, Associate Dean, and Director of
the Program in Intellectual Property Law at Chicago-Kent College of Law.
He also holds a Chair in Intellectual Property Law at Queen Mary College,
University of London. Professor Dinwoodie has authored numerous articles
on intellectual property law. He holds a First Class Honours LL.B. degree
from the University of Glasgow, an LL.M. from Harvard Law School, where
he was a John F. Kennedy Scholar, and a J.S.D. from Columbia Law School,
where he was a Burton Fellow. He was elected to membership in the
American Law Institute in 2003.
Allen N. Dixon is a lawyer who has represented the intellectual property
interests of the technology and traditional content industries in various
vi
Contributors
vii
capacities for more than 20 years. He has served in General Counsel and
Assistant General Counsel positions in Asia, the US and Europe. As
European counsel and partner at Covington & Burling, he was the senior
legal advocate of the business software sector on intellectual property
matters in Europe in the late 1990s, acting as counsel to the Business
Software Alliance and individual software companies. From 2000 to 2005 he
was General Counsel and Executive Director of the international recording
industry association IFPI. Since 2005, he has been the principal and managing director of International Intellectual Property & Technology Consulting.
Jane C. Ginsburg is the Morton L. Janklow Professor of Literary and
Artistic Property Law at Columbia University School of Law, and CoDirector of its Kernochan Center for Law, Media and the Arts. With
Professor Sam Ricketson, she is the co-author of International Copyright
and Neighbouring Rights: The Berne Convention and Beyond (Oxford
University Press, 2006). Other books include Foundations of Intellectual
Property (Foundation Press, 2004) with Professor Robert P. Merges, and
Intellectual Property Stories (Foundation Press, 2005) with Professor
Rochelle Dreyfuss. With Professor Dreyfuss and Professor Franois
Dessemontet, she is also a co-reporter for the American Law Institute Project
on Intellectual Property: Principles Governing Jurisdiction, Choice of Law
and Judgments in Transnational Disputes.
Vicky Hanley is a UK associate in the Brussels office of Covington &
Burling LLP. Her practice involves legislative advocacy and advising on
policy-making and legislative processes. Miss Hanley has recently advised
leading multinational companies on regulatory issues in areas including
intellectual property and telecommunications, including the current review
of the electronic communications regulatory framework. She is also an
Edmund Davies Scholar of The Honourable Society of Grays Inn (2002)
and a member of the European Bar Group. Recent publications include
Last-ditch attempt to improve the EU patent system in the Journal of
Intellectual Property Law & Practice (September 2007), which she coauthored with Alain Strowel.
Alexander Peukert is Associate Professor of Civil Law, Commercial Law
and Intellectual Property Law at the Johann-Wolfgang-Goethe University
Frankfurt/Main, Cluster of Excellence The Formation of Normative
Orders. He graduated in law (1998) and earned his doctorate in law (1999)
from the University of Freiburg. After his second state examination (2001),
he worked at a law firm in Berlin, specializing in IP and media law. From
2002 to 2008, he was a senior research fellow at the Max Planck Institute for
viii
Contributors
ix
Table of cases
MGN Ltd [2002] 1 WLR 2003
215
Asia Media Inc. et al v Yang, No.
2002KAHAP77 (Suwon D.
Court, Seongnam Branch, First
Civ. Dept. 9 July 2002)
257
AT&T Corp. v City of Portland, 216
F33d 871 (9th Cir. 1999)
153
Atari Games Corp. v Nintendo of
Am., Inc., 975 F.2d 832 (Fed. Cir.
1993) 275, 276
Atherton v DPP [2006] 2 ILRM 153
220
Atlantic v Anderson (S.D. Tex.
2008) 66
Atlantic v Brennan, Civil No.
3:07cv232 (JBA) (13 February
2008, D. Conn) 67
Australian Tape Manufacturers
Association Ltd v
Commonwealth of Australia
(1993) 176 CLR 480 (High Court
Aus.) 122
Bahleida v Santa (2003) 233 (4th)
382 203
Baker v Selden, 101 US 99 (1880)
2757
Baker-Bauman v Walker, 2007 WL
1026436 137
Bidzerk LLC v Smith, 2007 WL
3119445 (D.S.C.) 88
BMG Canada Inc. v John Doe, 2004
FC 488 (Canada Fed. Ct. 31
Table of cases
xi
xii
Table of cases
xiii
xiv
Table of cases
xv
xvi
Table of cases
xvii
xviii
the technical means (in particular the software) to make primary infringements
online possible. The development of peer-to-peer networks over the Internet
has, therefore, brought the issue of secondary liability to the forefront.
Introduction
cies. For example, BitTorrent, a P2P communication protocol that uses trackers and metafiles to coordinate file distribution, has had its share of legal
controversy (although no significant case law yet), but in recent years has
worked with media companies and organizations to reduce illegal use of its
protocol. In 2005, BitTorrent Inc. signed an agreement with the Motion Picture
Association of America (MPAA) to collaborate on stopping Internet piracy;
specifically, BitTorrent agreed to remove all links to unlicensed copies of
movies owned by the seven MPAA studio members. Other ways to reconcile
the use of this promising technology with the possibility to protect and remunerate copyright holders are explored.
Despite such progress, copyright infringement online remains ubiquitous,
triggering particularly important and fascinating legal discourse extending
beyond that of direct infringement to the liability of third parties.
5
See Antony Bruno, WMG Sues Music Search Site Seeqpod, Billboard.biz,
23 Jan. 2008.
Introduction
Sony Corp. of American v Universal City Studios, 464 U.S. 417 (1984).
A&M Records, Inc. v Napster, Inc., 239 F.3d 1004 (9th Cir. 2001).
MGM Studios, Inc. v Grokster Ltd., 125 S. Ct. 2764 (2005).
Universal Music Australia Pty Ltd. v Sharman License Holdings Ltd., (2005)
FCA 1242.
Introduction
that a strict view on territoriality which would require domestic courts where
the primary acts of infringements occur to take responsibility could make the
legal analysis largely unmanageable. In addition, Graeme Austin considers the
impact of public international law norms (the Berne Convention) on private
international law and on the conflict of law issue; if those international norms
are taken seriously, Graeme Austin argues, courts imposing liability for indirect infringement should not be impeded by the fact that their decisions might
have extraterritorial effects.
10
Most advocates of those alternative solutions, for example, Terry Fisher, Neil
Netanel, Aric Jacover, Jessica Litman, Mark Lemley and Anthony Reese, are US-based
academics. It is in France, however, that the solution of a non-voluntary licence (the
licence globale) was at some point seriously considered by the legislature during the
Parliamentary discussions leading to the adoption of the 2006 French Copyright Act.
11
Although Peukerts paper emphasises some issues linked with a levy system,
a thorough discussion about the merits and drawbacks of levies is well beyond the
scope of the present volume.
Introduction
10
Introduction
11
issue of data protection, special rules are also defined in the draft, that allow
certain designated private parties to collect personal data and transmit it to the
High Authority for processing.
Other developments at the EU level (such as the European Commissions
consultation and the January 2008 Communication on Creative Content
Online in the Single Market) and at the national level (such as the February
2008 UK Green Paper entitled Creative Britain: New Talents for the New
Economy) all point towards the creation of a new framework for addressing
mass copyright infringement on the Internet and the increasing role to be
played by intermediaries.
We will see whether the new French approach to tackling online copyright
infringements, should it be incorporated into law, will succeed. The coming
months will be decisive in that regard. Even if such a system is integrated into
the French legal arsenal, it is doubtful that many other (European) countries
will follow this example in the mid-term. However, it is clear that the role of
ISPs in fighting online infringements will continue to be hotly debated.
Although legislative changes could potentially redefine the way online
infringement is addressed, the standard rules on secondary liability as applied
by the courts in civil proceedings for copyright infringement will remain the
preferred way to combat P2P and other mass copyright infringement. Thus, an
overview of the main doctrines and issues of secondary copyright liability
remains a valuable tool.
ing letter, the High Authority may order the suspension of access for a period of three
months to one year.
A NOT-SO-FARFETCHED SCENARIO
A new taxi service GetawayQuick drives members of the public to the destinations they choose. Unlike most car services, however, the business model of
this one is to become the car service of choice among bank robbers. Because
of its inside knowledge, and the speed and nondescript nature of its cars, this
* The author acknowledges the kind research assistance of St. Johns University
law sudents Nicholas Madonia and Edward McNamara.
12
13
service is particularly good at getting bank robbers to the banks and doing a
quick getaway.
Ninety percent or more of its work is bank jobs. In theory, the service could
drive customers to estate-agent offices, blind dates, or free-speech rallies
among Chinese dissidents, but no one has actually proved that any jobs of that
sort have ever happened. The drivers take the robbers to the bank, wait outside
during the stick-up, carry the robbers with the loot away to other jobs if they
like and make money in the process. The service is so efficient that huge
numbers of people have decided to get into the bank robbing game, and the
cab services business is booming. Advertisers are queuing up to sell things to
their customers.
When arrested for aiding and abetting multiple bank robberies, the taxi
company is shocked. Our drivers never pulled a gun on anyone, or touched
the money, they say. We had no idea what was going on in all those banks
these people may have been visiting friends or engaging in perfectly legitimate
bank transactions. If they happen to come out with money, theyre not stealing it, theyre just sharing it. As a matter of fact, banks are greedy institutions
that deserve what they get. They charge way too much in fees and interest, and
have been entirely too slow in adopting Internet banking, which would have
been a lot more secure. This arrest is just a continuation of outdated police
practices, which violate our right to drive, and chill the development of new
and exciting taxi service models.
Meanwhile, the national taxi association and the major automobile manufacturers while not threatened with such prosecutions themselves have
gone to the legislature en masse to be sure they are not prosecuted for bank
robberies. Friends of these industries in the legislature are regaled with nightmare scenarios about the dangers to them of prosecuting GetawayQuick.
GetawayQuick itself organises its nouveau riche customers to stage sit-ins and
write to their representatives. The legislature clarifies the common law of
aiding and abetting to deal with a few specific cab services and manufacturing
activities. GetawayQuick changes its business slightly to make sure it is not
caught by the new legislation.1
DEFINITIONS
Given that this area is replete with catchwords that different people use differently, it may be useful to define a few terms before examining what the courts
and legislators have been doing in this area.
1
This scenario is entirely fictional and satirical. Any resemblance to real
persons or events is entirely coincidental.
14
User. This term is used here to mean the person who engages in an act of
infringement the person who makes a reproduction, adaptation, performance,
communication or distribution in violation of the copyright or related-rights
owners rights.
Third party. This term means the person who has not engaged in an act
of infringement, but who is somehow connected with it. There are a range of
activity-related words (for example, intermediary, service provider) and
qualitative terms (for example, accomplice, contributor, inciter) regularly
used for such third parties and their activities.
Intermediary. An intermediary is one type of third party. The term is
commonly applied to telecommunications companies that provide, at a minimum, Internet access and connectivity between two or more individuals.
Service provider. In common parlance, this can mean anyone providing
any kind of service, whether Internet-based or otherwise any of whom might
become involved as third parties in infringement. The US Digital Millennium
Copyright Act applies this term for some purposes to Internet access providers,
and for other purposes to all types of providers of services on-line.2 The EU
E-Commerce Directive opted for a broader definition, covering all providers
of information society services.3 These and other similar laws grant liability
exemptions to a defined set of service providers, not typically on the basis of
their status but with respect to specifically defined activities that meet specific
conditions.
Internet. This is the publicly accessible telecommunications network of
interconnected computers and networks that operate on the basis of packet
switching technology and standard protocols such as IP (Internet protocol),
HTTP (hypertext transfer protocol) and the like. Approximately 1.5 billion
people world-wide use the Internet.4
File sharing. File sharing is the making available of files from a users
own computer for copying and transmission to other users over the Internet,
2
17 U.S.C. 512(k): (A) As used in subsection (a), the term service
provider means an entity offering the transmission, routing, or providing of connections for digital online communications, between or among points specified by a user,
of material of the users choosing, without modification to the content of the material
as sent or received. (B) As used in this section, other than subsection (a), the term
service provider means a provider of online services or network access, or the operator of facilities therefor, and includes an entity described in subparagraph (A).
http://www.copyright.gov/title17/92chap5.html.
3
Arts. 2(a)(b), Directive 2000/31/EC of the European Parliament and of the
Council of 8 June 2000 on certain legal aspects of information society services, in
particular electronic commerce, in the Internal Market (E-commerce Directive), O.J.
L 178 (17 July 2000), at 116, http://europa.eu.int/eur-lex/lex/LexUriServ/
LexUriServdo?uri=CELEX:32000L0031:EN:HTML.
4
http://www.Internetworldstats.com/stats.htm.
15
and the receipt of files made available this way. File sharing thus involves
uploading as well as downloading. File sharing takes place in networks of
users. Third parties have developed the file-sharing services and technologies
required to connect users and enable them to carry out such transmission and
copying activities in the third partys particular peer-to-peer (P2P) network.5
16
who distributes a device with the object of promoting its use to infringe
copyright, as shown by clear expression or other affirmative steps to
foster infringement, is liable for the users resulting acts of infringement.11
Commonwealth Countries: Statutory and Common Law Authorisation,
Vicarious Liability, Joint Tortfeasor and Incitement Rules
In Commonwealth countries, third-party copyright liability has sprung from
the notion of authorisation now enshrined in statutory law and interpreted
more broadly than its strict meaning as well as from other common law tort
and criminal law principles.
17
18
Id.
Sec. 36(1A), Australia Copyright Act 1968, as amended, provides as follows:
In determining, for the purposes of subsection (1), whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without
the licence of the owner of the copyright, the matters that must be taken into account
include the following:
(a) the extent (if any) of the persons power to prevent the doing of the act
concerned;
(b) the nature of any relationship existing between the person and the person who
did the act concerned;
(c) whether the person took any reasonable steps to prevent or avoid the doing of
the act, including whether the person complied with any relevant industry codes of
practice.
21
See for example, Performing Right Society Ltd. v Mitchell and Booker, Ltd
[1924] KB 762.
22
In The Koursk [1924] All ER Rep 168, at 175, cited with approval in Amstrad,
supra n. 17.
23
See generally Garnett, Rayner James and Davies (1999), Copinger & Skone
James on Copyright, ss. 2324, at 10991100 (14th ed.).
24
See for example, TONO v Bruvik, Civil Case No. 2004/822 (S. Ct. Norway,
27 January 2005) (defendant found liable for users unlawful Internet communications
of music files via hyperlinks on defendants site, where defendant deliberately
assisted such uploading, acted with intent, advertised Download as much as you
19
Duty of care to avoid damage. Civil law countries also tend to impose,
under a general legal duty of care, an obligation to act reasonably to
prevent harm to others. The duty required typically depends on the facts
and circumstances. An illegal act by someone is necessary (the users
infringement itself is usually sufficient), and some level of knowledge
on the part of the third party is typically required for liability to attach.
Courts often look at economic benefit to the third party and engage in
cost-benefit analysis (cost of harm, cost of avoidance, magnitude of
harm) in determining the duty of care, the existence of any violation of
that duty, and any remedy therefor.25
Injunctive relief against third parties. Civil law typically allows
prospective injunctions against persons involved in someone elses tort,
even if those third parties did not have prior knowledge of the wrongdoing. The German doctrine of Strerhaftung, for example, allows
injunctions against third parties engaging in affirmative acts that cause
a disturbance, even though damages will not be imposed against such
parties without proof of knowledge.26 Along these lines, the EUs 2001
Copyright Directive requires that national law make injunctions available to rights owners against intermediaries whose services are used to
infringe copyright, even if the intermediaries themselves are not liable
for the infringement.27
20
copyright applied to user activities in the first instance. Copies now are stored,
transmitted and used electronically sometimes even temporarily. Could the
copyright concepts of reproduction and distribution, traditionally applied to
articles in tangible form, be interpreted to cover computer and on-line storage,
transmission or usage?
The international community in the WIPO Copyright Treaties28 of 1996
answered this question with a resounding Yes. Copyright does cover storage in
digital form.29 Copyright also covers not just Internet transmissions but the
very act of making available copyrighted material for access on the
Internet.30
Thus, with rare exceptions,31 courts far and wide have found users liable
for posting and transmitting copyright material on the Internet without authorisation, including over file-sharing services.32 This result has been reached
28
WIPO Copyright Treaty (WCT) (Geneva, 20 December 1996); WIPO
Performances and Phonograms Treaty (WPPT) (Geneva, 20 December 1996).
29
The reproduction right, as set out in Article 9 of the Berne Convention, and
the exceptions permitted thereunder, fully apply in the digital environment, in particular to the use of works in digital form. It is understood that the storage of a protected
work in digital form in an electronic medium constitutes a reproduction within the
meaning of Article 9 of the Berne Convention. Agreed Statements Concerning Article
1(4) of WCT; see also Agreed Statements Concerning Articles 7, 11 and 16 of the
WPPT.
30
Art. 8, WCT; Arts. 10, 14, WPPT.
31
Reasons for Order and Order, BMG Canada Inc. v Doe, 2004 FC 488 (Canada
Fed. Ct. 31 March 04) (uploading and downloading not a copyright offence), reversed
and affd in part, 2000 FCA 193 (Canada Ct. App. 19 May 2005); SCPP v Anthony G.,
No. 0504090091 (Tribunal de Grande Instance de Paris, 8 December 2005) (private
copy exception excuses P2P reproduction and transmission), reversed, Anthony
G./SCPP (Cour dappel de Paris, 27 April 2007) (user fined and ordered to pay
damages and costs); www.legalis.net/jurisprudence-decision.php3?id_article =1954.
32
Courts have issued judgments against music file-sharers in many countries,
including Denmark, France, Finland, Germany, Italy, UK. Examples of judgments
include Polydor Ltd v Brown, No. HC 05C02035, [2005] EWHC 3191 (Ch) (UK High
Ct. Chancery Division, 18 November 2005) (Connecting a computer to the Internet
which is running P2P software and in which music files . . . are placed in a shared directory falls within this infringing act. This is a primary act of copyright infringement and
it does not matter whether the person knows or has reason to believe that what they are
doing is an infringement.). See also Order in Interlocutory Injunction Proceedings, No.
308 O 58/06 (Civ Chamber 8, Hamburg Landgericht, 25 January 2006); Order in
Interlocutory Injunction Proceedings, No. 28 O 634/05 (Kln Landgericht, 23
November 2005); Judgement, No. 95 Ds 1653 Js 15556/04 (57/04) (Kottbus D. Ct., 24
May 2004); Judgement, No. 461 Cs 509 Js 1607/02 (Frth D. Ct., 29 March 2004)
(offering of recordings for downloading violates reproduction and/or making available rights) Most of these cases have been settled following compensation payments
averaging several thousand US dollars. See IFPI, Breakdown of legal cases against
21
under copyright rules in place both before and after implementation of the
WIPO Treaties, on the basis that the copyright or neighbouring rights owners
reproduction right, communication right and/or making available right has
been violated. As of November 2007, for example, the recording industry had
brought over 80,000 cases against users in 20 countries for making recorded
music available without authorisation on file-sharing services.33
Third-Party Liability
1. Statutory exemptions for Internet service providers
Questions of third-party liability for Internet activities have come up in both
legislative and litigation contexts. Major telecommunications companies made
an initial pre-emptive push for specific statutory exceptions to the general
third-party liability rules for certain Internet-related telecommunications activities. These Internet service provider liability rules have been implemented
with a fair amount of consistency throughout the world:
mere provision of physical facilities as such does not make a telecommunications provider liable for someone elses communication of copyrighted material;34
mere conduit providers of Internet access, real-time routing between
third parties, caching and similar transient and intermediate storage en
route, are exempt from damages if their users infringe;35 and
hosting providers whose systems are used indefinitely by users to
store infringing material, are exempt from damages so long as they
remove or block infringements when they know or reasonably should
have been aware of them.36
22
37
See e.g., A&M Records, Inc. v Napster, Inc., 114 F. Supp. 2d 896, at 919 n.24
(denying summary judgment to Napster under 512(a)), affd, 239 F.3d 1004;
Universal Music Australia Pty Ltd v Sharman License Holdings Ltd [2005] FCA 1242
(5 September 2005) (denying Sharman defence under sec 112E of the Australian
Copyright Act, which provides that A person (including a carrier or carriage service
provider) who provides facilities for making, or facilitating the making of, a communication is not taken to have authorised any infringement of copyright in an audiovisual item merely because another person uses the facilities so provided to do
something the right to do which is included in the copyright.).
38
For example, Ellison v Robertson, 189 F. Supp.2d 1051 (C.D. Cal., 2002), revd
in part, 357 F. 3d 1072 (9th Cir. 2004) (14-day storage of newsgroups is transitory).
39
See, for example, Cooper v Universal Music Australia Pty. Ltd., infra n.42,
[2006] FCAFC 187, which found that an ISP that was aware of the intensive use and
copyright problems of a links site on its service, that gave free web hosting to the site,
and that took no steps to prevent the sites infringement, could not rely on a mere facility exception to liability.
40
For example, TONO v Bruvik, Civil Case No. 2004/822 (S. Ct. Norway, 27
Jan. 2005); Perfect 10, Inc. v Amazom.com, Inc., supra n.11 (no vicarious liability, no
contributory liability solely because the design of its search engine facilitates such
23
24
45
Docket No. 1157/04 (Ct. App. Amsterdam, 5th Civ Div, 15 June 2006), overruling Techno Design Internet Programming BV v BREIN, No. 85489/HA ZA 02-992
(D. Ct. Haarlem, 12 May 2004).
46
No. KG 01/2264 OdC (Amsterdam Ct. of Justice, 29 November 2001),
reversed, Kazaa v Buma/Stemra, No. 1370/01 (Amsterdam Ct. of Appeal, 28 March
2002), affd, No. C02/186HR (Netherlands S. Ct. 19 December 2003).
25
47
BUMA/STEMRA v Kazaa BV, No. C02/186HR (Netherlands S. Ct. 19
December 2003).
48
2002 (Wa) Case No. 4249 (Tokyo District Court, 29th Civil Division, interlocutory judgement 29 January 2003, damages decision 17 December 2003). See RIAJ
Press Release, Court decided Japan MMO, a file-sharing service company, for illegality; Interlocutory judgment by the Tokyo District Court, http://www.riaj.
com/e/news/20030129.html (29 January 2003); RIAJ Press Release, File-sharing
service company was ordered to pay 37 million Japanese yen; Tokyo District Court
decided the damages (17 December 2003), http://www.riaj.com/e/whatsnew/
20031217.html.
26
The criminal case initially failed,49 but in July 2002 the civil court
found Soribada liable because it knew or ought to have known of the
infringements taking place on its service. The court issued an injunction
requiring the peer-to-peer service to stop letting users download the
plaintiffs recordings, and to stop operating the service on the Korean
Data Centres servers.50 This decision was upheld on appeal,51 and
Soribada 1 shut. (In January 2005, the court also awarded the music
publishers society KOMCA about 19 million Won (US$ 18,000) for
Soribadas secondary infringement of KOMCA members reproduction
and transmission rights in about 5,000 songs.)
Soribada reopened in 2004 as a decentralised file-sharing service
(Soribada 2), which was improved and expanded into what became
known as Soribada 3. On 29 August 2005, the Seoul Central District
Court again ordered Soribada to suspend operation of its service and
distribution of the services software on the basis that the defendants:
49
The criminal case was dismissed on 15 May 2003 on the ground that the
charges did not adequately specify how Soribada aided and abetted copyright infringement. The prosecutor appealed this dismissal to the High Court. On 12 January 2005
the High Court rejected the criminal appeal, finding that Soribada had not been given
adequate notice of specific infringements and therefore could not be found aiding and
abetting a crime. In re Yang and Yang, Docket 2003 No. 4296 (Seoul D. Ct., Crim. Ct.
No. 5, 12 January 2005). The Supreme Court overturned this High Court decision, finding that if the developers could expect infringements to occur in their P2P system, they
abetted users infringements if they did not stop them. Case 2005 Do 872 (Korea S. Ct.
14 December 2007).
50
Asia Media Inc. v Yang, No. 2002KAHAP77 (Suwon D. Court, Seongnam
Branch, First Civ Dept, 9 July 2002).
51
Sinchon Music Co., Ltd. v Yang, Docket No. 2003 Na 21140 (Seoul High Ct.,
Civ Ct. No. 4, 12 January 2005), affd, 2005 Da 11626 (Korea S. Ct. 25 January 2007).
52
Korean Assn. of Phonogram Producers v Soribada Inc., Docket No. 2004 Ka
Hap 3491 (Seoul D. Ct., Civ Ct. No. 50, 29 August 2005). See Court Blocks Free FileSharing Services, Korea Times (31 August 2005), http://search.hankooki.com/times/
times_view.php?term=soribada++&path=hankooki3/times/lpage/nation/200508/kt200
5083117362711960.htm&media=kt.
27
The Korean record companies and Soribada settled the case in February
2006, with Soribada agreeing to pay 8.5 billion Won in compensation
(US$ 8.7 million). Following the settlement, Soribada opened a new
centralised P2P service (Soribada 5) which purported to use filtering
technologies to prevent infringement of the record companies rights. A
preliminary injunction sought by the record companies against this
service initially failed in August 2006, based on Soribadas defence that
stopping infringements would be technically impossible. The High
Court found on appeal, however, that Soribada had not used requisite
best efforts in filtering out infringing files.53 The parties have since
entered into a new settlement, and Soribada opened an authorised
subscription P2P service.
China Taipei (Taiwan): EzPeer.54 Subscription file-sharing service
EzPeer was indicted for aiding and abetting infringement, and sued for
civil copyright infringement. EzPeer was a centralised peer-to-peer
service in Taiwan that charged users for file sharing of music, film and
software files. IFPI Taiwan secured a civil injunction on 11 December
2003 requiring EzPeer to remove 105 infringing Chinese repertoire
tracks from its service. The Shih-Lin District Court dismissed the criminal case against EzPeer principals on 30 June 2005, finding among
other things that the defendants did not have the requisite criminal
intent or knowledge to be deemed accessories to users crimes. Several
individuals also were indicted, found guilty and sentenced for illegally
reproducing MP3 files from the EzPeer and Kuro services. IFPI and
EzPeer reached a civil settlement in June 2006. EzPeer shut down its
unauthorised file-sharing service, and set up a licensed and digital
rights management protected service called EzPeer+.55
China Taipei (Taiwan): Kuro.56 In December 2003, subscription filesharing service Kuro was indicted for aiding and abetting infringement;
civil infringement proceedings were also brought. Kuro was a
centralised peer-to-peer service in Taiwan that charged users for file
sharing music files. Kuros CEO and President (brothers Chen), and the
Chen brothers father (deemed a legally responsible person) were
indicted on 1 December 2003 for aiding and abetting unauthorised
53
No. 2006 Kahap/535 (Seoul D. Ct. 22 August 2006), revd, No. 2006/a 1535
(Seoul H. Ct. 10 October 2007).
54
Global Digital Technology Co., Ltd., 2002 Zhen Zi No. 10786 and No. 4559
(Shih-Lin (Taiwan) Dist. Ct. 30 June 2005).
55
G. Kennedy & S. Doyle, Pacific Rim News, 23 Computer L. & Sec. Rep.
152153 (2007).
56
Fashion Now Ltd., 92 Suit No. 2146 (Taipei (Taiwan) Dist. Ct.).
28
29
The defendants found liable were ordered to stop authorising infringement, which would be met by implementing a filter for infringing music
tracks; to pay 90 per cent of the plaintiffs costs; and to come back to
court for a damages hearing. The parties settled the litigation in July
2006, with the defendants paying a reported US$100 million in settlement damages to record company claimants and agreeing to filter their
service.60
Netherlands: Stichting BREIN v Leaseweb BV.61 The defendant ISP
was hosting a customer (Everlasting) that operated a BitTorrent site, a
recent hybrid of links and file sharing by which Torrent files point users
to particular content files and tracker sites coordinate the simultaneous uploading and downloading of those files between numerous users
of the BitTorrent software. Without deciding at the preliminary injunction stage whether the customers site violated copyright, the court
found that Everlasting structurally facilitates the infringement of copyrights and neighbouring rights and ... (the holder of) Everlasting must
be aware of this. Everlastings conduct therefore is unlawful, because it
is contrary to the principle of due care that must be observed vis--vis
those entitled to copyrights.62
60
Kazaa to pay record groups $100m, Financial Times (27 July 2006); IFPI,
Press Release: KAZAA settles with record industry and goes legitimate (27 July 2006),
http://www.ifpi.org/content/section_resources/piracy-report-current.html.
61
No. 369220 / KG ZA 07-850 AB/MV (D. Ct. Amsterdam, Civ Sector, 21 June
2007), affd, LJN: BD 6223, Amsterdam Court, 106.007.074/01KG (Amsterdam Ct.
App. 3 July 2008).
62
Id., para. 5.4. Accord, Stichting BREIN v KPN, No. 276747 / KG ZA 06-1417,
para. 4.4 (Hague Ct., 5 January 2007):
[The BitTorrent site operator is] facilitating structural infringements of copyrights
and neighbouring rights. In light of the nature of the files alone, it cannot be otherwise than that the Website Owner is aware of this. It is furthermore relevant that
income is being generated by means of the website because before being able to
download torrents a user is required to pay a certain amount. In these circumstances it must be concluded for the present that the Website Owners actions are
wrongful, not because the Website Owner is infringing the copyrights or neighbouring rights vested in the rightful owners, but because its actions conflict with the
due care that must be observed towards the rightful owners.
30
4. Third-party injunctions
Another development in this area has been the willingness of courts internationally to issue orders against Internet service providers and other third
parties to put a stop to infringers Internet activities. Thus for example,
German courts have held Internet account holders responsible for copyright
infringements claimed to be conducted by others using their accounts,63
enjoined an auction site to cut off offers that infringe trademark,64 enjoined an
eDonkey file-sharing server operator from allowing the making available of
infringing music files from his server,65 and enjoined payment-system
providers from conducting transactions on behalf of an infringing website.66
In the same vein, French courts have ordered ISPs to cut off more than 100
subscribers Internet accounts found to be involved in unauthorised file sharing.67 The Danish Supreme Court ordered service provider TDC, the countrys
largest telecommunications provider, to terminate the Internet connections of
two individuals on the TDC service that were offering infringing music files
from FTP servers.68 And in the Netherlands Leaseweb case, the court ordered
the ISP to disclose the customers identification and remove his BitTorrent site
from its service.69
5. Filtering or blocking
Courts increasingly have proved willing to grant injunctions that include a
requirement that a service provider filter or block infringing files or other
63
Order in Interlocutory Injunction Proceedings, No. 308 O 58/06 (Civ.
Chamber 8, Hamburg Landgericht, 25 January 2006) (he is the owner of the Internet
connection . . . and no fault is necessary for the restraining order demand); Order in
Interlocutory Injunction Proceedings, No. 308 O 41/06 (Civ. Chamber 8, Hamburg
Landgericht, 18 January 2006) (when he makes his Internet connection available to his
underage son, he has the duty .. to stop illegal conduct).
64
Montres Rolex v Ricardo, I ZR 304/01 (Germany Supreme Civil Ct. (BGH),
11 March 2004).
65
Universal Music GmbH v Rac, No. 308 O 273/07 (Hamburg D. Ct., Civ. Div.
No. 8, 24 April 2007).
66
Judgement, No. 27 O 836/04 (Berlin Regional Ct., 23 November 2004).
67
See IFPI, Breakdown of legal cases against illegal file-sharing, http://www.
ifpi.org/site-content/press/20060404a.html.
68
TDC v IFPI, No. 40/2005 (Denmark S. Ct., 10 Febuary 2006) (failure to
impose such an injunction would violate Art. 8(3) of the EU Copyright Directive);
Danish Court Tells ISPs To Cut Pirates Connections, Billboard.Biz (15 February
2006), http://www.billboard.biz/bb/biz/newsroom/legal_management/article_display.
jsp?vnu_content_id=1002033151.
69
Stichting BREIN v Leaseweb BV, supra n. 60, paras. 7.17.2; accord, Stichting
BREIN v KPN, supra n. 61, para. 4.15 (ISP would breach its own duty of care by not
disconnecting the customers BitTorrent site).
31
70
Napster, supra n. 37, 239 F.3d at 1027: Napster has both the ability to use its
search function to identify infringing musical recordings and the right to bar participation of users who engage in the transmission of infringing files.Napster bears the
burden of policing the system within the limits of the system.
71
Order para. 5, Universal Music Australia Pty. Ltd. v Sharman License
Holdings Ltd, supra n. 59:
5. Continuation of the Kazaa Internet file-sharing system (including the provision
of software programs to new users) shall not be regarded as a contravention of order
4 if that system is first modified pursuant to a protocol, to be agreed between the
infringing respondents and the applicants or to be approved by the Court, that
ensures either of the following situations:
(i): that:
(a) the software program received by all new users of the Kazaa file-sharing system
contains non-optional key-word filter technology that excludes from the displayed
blue file search results all works identified (by titles, composers or performers
names or otherwise) in such lists of their copyright works as may be provided, and
periodically updated, by any of the applicants; and
(b) all future versions of the Kazaa file-sharing system contain the said non-optional
key-word filter technology; and
(c) maximum pressure is placed on existing users, by the use of dialogue boxes on
the Kazaa website, to upgrade their existing Kazaa software program to a new
version of the program containing the said non-optional key-word filter technology;
or
(ii) that the TopSearch component of the Kazaa system will provide, in answer to a
request for a work identified in any such list, search results that are limited to
licensed works and warnings against copyright infringement and that will exclude
provision of a copy of any such identified work.
72
See e.g., Grokster, supra n. 10; Sharman, supra n. 58.
73
Case No. FI-15124/2006 (Copenhagen City Ct., 25 October 2006).
32
33
concerns ( 0.50 per user per month) as ultimately payable by the users of the
service and not excessive, and about possible false positives as insufficient
reason not to issue the injunction.
The courts analysis in SABAM makes clear that the normal issues relevant
to any injunction such as its efficacy, technical feasibility, and economic
reasonableness will be equally relevant to any specific requirement to filter.
The court also found that such an injunction did not impose a general monitoring requirement, did not impose liability on the service provider or eviscerate its general exemption from liability, and did not violate privacy laws.
LEGISLATIVE TRENDS
Some proposed legislation to deal with third-party copyright liability generally, or peer-to-peer activities specifically, have started to appear after a fairly
long gap that followed the development of the original ISP liability-limitation
rules in the late 1990s.
US. The 2004 US Induce Act proposal77 was subject to intense criticism and went nowhere, as did calls to change contributory-liability
rules in the US following the Grokster decision.
European Union. The European Commissions 2005 and 2006 proposals for a criminal-enforcement directive for intellectual property
included a provision to criminalise attempting, aiding or abetting and
inciting infringements on a commercial scale78 a fairly standard
accomplice-liability provision.
France. The French legislature enacted amendments to the copyright
law in 2006 that appear to be directed specifically at publishers of filesharing software. The law imposes a fine of 300,000 and three years
imprisonment on those who provide software obviously intended to
77
78
34
79
35
or reproduction. Such intention can be found where the provider advertises or takes other positive measures to abet, induce, procure or
persuade the public to infringe.84
SOLUTIONS?
Factors for Future Cases
Lawyers in the US and Commonwealth and civil law jurisdictions have prided
themselves on knowing and applying discrete rubrics and doctrines for finding third parties liable for users infringements, but it is increasingly apparent
that:
these doctrines overlap;
particular tests such as authorisation are being interpreted more
broadly and even differently than their literal meaning;
courts are applying a broader set of considerations in determining thirdparty liability regardless of the rubric chosen; and
these trends can be seen in all three types of legal traditions, with similar results.
In the US, for example, the pre-Grokster debate was whether the doctrine of
contributory liability applied where the third party file-sharing service
arguably knew about, intentionally facilitated, promoted and benefitted from
user infringements, but had tried to put himself beyond any real-time control
of user activities, and could articulate at least theoretical non-infringing uses
of his service.85 The defendants argued that the element of control (or at least
84
Art. 87(7), Taiwan Copyright Act (promulgated 11 July 2007):
Provision of computer programs or other technologies that enable the public to
publicly transmit or reproduce copyrighted works, with the intent to facilitate the
public, via the Internet, to publicly transmit or reproduce others works without
approval or authorization of the economic rights holder, thus infringing on the
economic rights of others and thereby gaining profits.
Person engages in the activity as described in Subparagraph 7 of the preceding paragraph, shall be deemed with the intent as referred to in that subparagraph shall the
said person advertise or take other positive measures to abet, induce, procure or
persuade the public to utilize a computer program or other technology to infringe
on the economic rights of others.
85
The district court noted that the defendants in the Grokster case may have
intentionally structured their businesses to avoid secondary liability for copyright
infringement, while benefiting financially from the illicit draw of their wares. Metro-
36
file-by-file, post facto control) of the contributory liability doctrine was not
met. They also argued that any non-infringing use would also defeat a finding
of liability under the Sony doctrine.
Nevertheless, not a single member of the Supreme Court would let
Grokster off. Appealing to older formulations of third-party liability rules that
included inducing infringement,86 the court found that a third party could be
found liable if he promoted infringement. That promotion need not be subjective or overt it could be proved from more than one objective activity of
communication (soliciting infringing users), failure to prevent or curtail
infringement (that is, to filter), or profiting from the infringement. In such
circumstances, actual or potential lawful use, even if substantial, was no
defence.
In the Commonwealth, commentators likewise have agonised over the
boundaries of the doctrine of authorising infringement,87 probably unnecessarily. For one thing, authorising infringement is not, as we have seen, the
exclusive rubric under which third parties can be held liable for users
infringements. Doctrines of joint tortfeasorship, inciting, aiding and abetting
and the like have equal footing to authorisation as bases for third-party liability, and as the commentators note, liability can be and sometimes is founded
on more than one theory.88
Moreover, courts in the Commonwealth have rarely taken the word authorisation literally. As a practical matter, doing so would make the offence
nearly meaningless. It is rare to find a major infringer that has overtly told
users to do something illegal any sensible third party would not be caught
dead doing so. Courts therefore have interpreted the term authorisation more
broadly to include activities with similar intent or effect countenancing,
counselling, aiding, controlling, inducing, and even inactivity or indifference to a degree from which authorisation, promotion or permission may
be inferred.
Goldwyn-Mayer Studios Inc., v Grokster, Ltd., 259 F. Supp. 2d 1029, 1037 (C.D. Cal
2003), affd, 380 F.3d 1154 (9th Cir. 2004), revd, No. 04-480, at 1 (S. Ct. 27 June
2005).
86
E.g. Kalem Co. v Harper Brothers, 222 U.S. 55, 62-63 (S. Ct. 1911) (defendant that not only expected but invoked [infringing use] by advertisement was liable
for infringement on principles recognised in every part of the law.)
87
E.g. Laddie, Prescott and Vitoria, The Modern Law of Copyrights and
Designs, 3rd ed., London: Butterworths 2000. 39.14, at 1772 (the breadth of this
[authorisation] tort is unclear, and some of the cases, mostly concerned with copyright,
are hard to reconcile with one another).
88
Id. 39.18, at 1777 (in a number of cases in which a defendant has been
found guilty of authorising infringement he could have been held to have committed
infringement either vicariously or as a joint tortfeasor).
37
89
Declaration of Professor Dr. Ir. E. Huizer (18 February 2002), Kazaa v
Buma/Stemra, supra n. 46.
38
90
The actual level of non-infringing use is a determination of fact which at times
defendants have even sought to adjust artificially during litigation. See, e.g., Stichting
BREIN v Leaseweb, supra n. 61, para. 2.5:
On 14 May 2007, the following was posted on Everlasting:
Hello everybody, This afternoon I was called by the provider of the server. He told
me that he had been warned by BREIN about our site. At that time, this man was
having a meeting with the companys lawyerThe lawyer recommended that I
upload some personal files, such as some nice photographs you once made or
recipes etc, as long as they are NOT copyright protected.
91
See 17 U.S.C., supra n. 2, 512(i) (policies against infringement, accommodation of standard technical protections).
92
Grokster, supra n. 10; Sharman, supra n. 59.
39
Figure 1.1
It seems clear from these cases that no one factor itself will impute liability,
but the strong presence of two or more accumulated elements ties a third party
more closely to the infringement in ways that courts may find sufficient to
93
94
E.g. In re Aimster Copyright Litigation, 334 F.3d 643 (2d. Cir. 2003).
E.g. 17 U.S.C. 512(i)(2)(C) (service providers must accommodate certain
technical protections that do not impose substantial costs on service providers or
substantial burdens on their systems or networks); In re Aimster Litigation, supra n.
92 (if the infringing uses are substantial then to avoid liability as a contributory
infringer the provider of the service must show that it would have been disproportionately costly for him to eliminate or at least reduce substantially the infringing uses).
40
impose liability on the third party. For example, merely describing in a magazine how to copy music illegally and asking Why buy spend $10 on the latest
David Bowie album when you can tape it? may indicate intention to assist or
promote infringement, but without any further evidence of some relationship
with the user, financial benefit or further involvement with any particular
copying, making such a publication may not result in liability.95
Releasing a generic product or service like a cassette duplicator or VCR
that has primarily or substantial non-infringing uses, where there is no further
involvement with the users, no express or implied promotion of infringement,
and no benefit that can be tied directly or indirectly to the infringement, has
not resulted in third-party liability to the manufacturers, even where these third
parties knew or should have known that users would engage in infringement
from time to time.96
On the other hand, even though a particular peer-to-peer service might be
used for non-infringing purposes, where it was mostly used by users for
infringement, and the third party had actual or imputed knowledge of user
infringement, promoted the service for such purposes, got a financial benefit
and engaged in an on-going connection with users, with inadequate (or no)
efforts to prevent or reduce infringement, such a third party will likely be held
liable for users infringements.97
Regardless of the liability theory articulated, therefore, it is likely that many
or all of these factors will continue to be the elements that courts will weigh
in deciding whether to impute liability to third parties for activities like file
sharing.
Defunct Defences
In the area of litigation against peer-to-peer services, it appears that several of
the defences commonly raised by such services are on their way to extinction.
These are the following:
The Frankenstein defence: Ive created a monster that has gone on the
rampage and now I cant control it. This type of defence has been effectively rejected in the Aimster and Sharman litigation.
The Einstein defence: This system is so complicated that the court and
even I, the service operator, cannot understand it. This was also rejected
in the Sharman litigation.
95
See RCA Corp. v John Fairfax and Sons Ltd., [1981] 1 NSWLR 251
(Australia).
96
Sony, supra n. 7; Amstrad, supra n. 17.
97
Grokster, supra n. 10; Sharman, supra n. 59.
41
CONCLUSION
The area of third-party liability with respect to Internet activities like file sharing seem to have gone through a phase of de-mythologising. In the US,
Commonwealth and civil law jurisdictions, judges seem to be having little
trouble in applying long-standing legal doctrines of third-party liability in a
98
42
OVERVIEW
Peer-to-peer file sharing has had a profound effect on the copyright industries
in recent years, especially the music industry, creating legal questions surrounding liability for illegal distribution of copyright materials online. Indeed, in
many countries, existing exclusive rights under copyright, or slightly modified
rights, comprise all the chief activities undertaken in the course of a P2P transaction largely through implementation of the interactive making available
*
Michael Schlesinger is Of Counsel to the law firm of Greenberg Traurig LLP
in Washington, DC. Mr. Schlesinger also serves as Professorial Lecturer in Law at
George Washington University School of Law and is a Lecturer at the Munich
Intellectual Property Law Center (MIPLC). He represents the International Intellectual
Property Alliance (IIPA). The views expressed in this chapter are solely those of the
author, and are not necessarily endorsed by Greenberg Traurig LLP, GWU School of
Law, MIPLC, or the IIPA. Mr. Schlesinger can be reached at SchlesingerM@gtlaw.
com.
1
One more quote could be added to these, that of John F. Smith, President,
International Federation of Musicians (FIM): ISPs are the gatekeepers of the Internet
they have the technical means and the moral responsibility to play an important role
in protecting copyrighted content on their networks and to ensure that performers
receive fair remuneration for the sale and use of their work on those networks.
43
44
right. The touchstone of this interactive right, as supported by case law in most
countries, is that a work can be made available to others in a manner such that
they may access it from a time and place chosen by them, and nothing more
(that is, even if the specificity of the onward transmission is not proven). The
future for copyright industries depends on the continued robustness of such
exclusive rights in the digital environment, preservation or confirmation of
secondary liability for copyright infringements online, and the continued or
increasing cooperation of service providers.
2
Digital Music Report 2008, 24 January 2008, at http://www.ifpi.org/content/
section_resources/dmr2008.html.
3
In the worlds biggest digital music market, the US, online and mobile sales
now account for 30 per cent of all revenues, according to IFPI.
4
Id. (reporting that Italys Luigi Einaudi Foundation in 2007 found that 30 per
cent of peer-to-peer users bought fewer CDs and DVDs, while only 6 per cent said they
bought more CDs, and In Australia, research undertaken for ARIA (February 2007)
shows that 57 per cent of P2P downloaders rarely or never purchase the music they
download pointing to straight substitution of legitimate sales).
45
Japan (with more than one third of all mobile users admitting to regular illegal downloading on mobile networks) and in Southeast Asia, where mobile
technologies are ubiquitous, but legal services remain sparse.
In Europe, illegal file sharing of copyright materials has proliferated in
recent years; however, where good cooperation in enforcing copyright exists,
the rate of Internet users regularly sharing files illegally has remained relatively low. Contrast that with countries that have little or no enforcement in the
online space, like in the Netherlands and Spain, and the rates of illegal file
sharing are greater: 28 per cent and 35 per cent, respectively, of Internet users
regularly engage in illegal file sharing.
WIPO Copyright Treaty, S. Treaty Doc. No. 105-17 (1997); 36 ILM 65 (1997)
(entry into force March 6, 2002), at http://www.wipo.int/treaties/en/ip/
wct/pdf/trtdocs_wo033.pdf (WCT), Art. 8 (Right of Communication to the Public).
6
WIPO Performances and Phonograms Treaty, S. Treaty Doc. No. 105-17, 36
ILM 76 (1997) (entry into force May 20, 2002), at http://www.wipo.int/clea/
docs_new/pdf/en/wo/wo034en.pdf (WPPT), Arts. 10 (Right of Making Available of
Fixed Performances) and 14 (Right of Making Available of Phonograms).
46
The adoption of such rights in the WCT and WPPT importantly sought to close
gaps in coverage in the existing conventions and treaties (either as to certain
acts or as to certain subject matter), as no right in the existing treaties
adequately or completely dealt with the transmission of works and objects of
related rights through the Internet or other similar digital interactive networks.
Two essential theories for the type of new exclusive right to be granted
emerged at the 1996 Diplomatic Conference: one seeking to fit digital and
interactive transmissions within existing notions of distribution, and another
seeking to fit such transmissions within existing notions of communication to
the public. Neither a distribution model nor a communication model
seemed entirely satisfying (or acceptable) to the delegates at the 1996
Diplomatic Conference because of the nature of digital transmissions; for
example, the transmission from one computer to another does not result in the
transfer of property or possession (because the source copy remains in the
possession of the sender), but by the same token, such a transmission does not
resemble a traditional non-demand broadcast (because of the interactive nature
of making available).
What emerged was a flexible approach owing to the differences in national
legislations and approaches at the time, an approach Dr. Mihly Ficsor has
dubbed the umbrella solution. As long as the act of making works, sound
recordings and performances available interactively is covered by one or more
exclusive rights, national legislatures could have considerable flexibility in
labeling or characterizing the exclusive rights involved.8 Thus, while the WCT
and WPPT do not require that the so-called distribution right extend beyond
the distribution of tangible copies, the umbrella solution does permit signatories to implement the communication to the public/ making available right
by applying the exclusive distribution right in a countrys law to electronic
transmissions of works, sound recordings, and performances fixed in sound
recordings. Most countries, however, have opted for adapting other existing
rights, most commonly the communication to the public right, to ensure that
interactive transmissions are covered. As to related rights, most countries have
7
8
47
9
World Intellectual Property Organization, Guide to the Copyright and Related
Rights Treaties Administered by WIPO and Glossary of Copyright and Related Rights
Terms, WIPO Pub. No. 891(E) (2003), CT-8.6, at 208.
10
For example, in the United States, the Supreme Court held in New York Times
Co. v Tasini, 533 US 483, 488 (2001), that notwithstanding absence of proof that individual copies of plaintiffs articles on defendants database were transferred to users of
the database, it is clear that the defendants distribute copies of the plaintiffs articles
merely by making them available for download. Id. at 498, 505. The Court rejected the
defence that there was no distribution under US law by the defendants since it was the
database subscribers who were responsible for the downloading.
11
See, e.g., Playboy Enterprises, Inc. v Frena, 839 F. Supp. 1552 (M.D. Fla. 1993).
12
The Register of Copyright and the United States Congress concluded that
48
Unlike the US, the EU opted for a communication to the public.13 At the
time these standards were adopted, there was little question that making available works (including objects of related rights) in such a way that anyone can
access them at their own time and place, including P2P uploads or downloads,
would be covered. It would have been absurd, for example, for the United
States to leave a gap in coverage for any acts of making available as defined
under the WCT and WPPT because at that very moment it was amending its
106(3) covered the making available right, such that no amendment to the US
Copyright Act was necessary. Letter from Marybeth Peters to Rep. Howard L. Berman
(25 September 2002), reprinted in Piracy of Intellectual Property on Peer-to-Peer
Networks: Hearing Before the Subcomm. on Courts, the Internet, and Intellectual
Property of the House Comm. on the Judiciary, 107th Cong. 2nd Sess. 11415 (2002)
([M]aking [a work] available for other users of a peer to peer network to download . .
. constitutes an infringement of the exclusive distribution right, as well of the reproduction right.) (As you are aware, in implementing the new WIPO Copyright Treaty
(WCT) and WIPO Performances and Phonograms Treaty (WPPT) in the Digital
Millennium Copyright Act, Congress determined that it was not necessary to add any
additional rights to Section 106 of the Copyright Act in order to implement the making
available right under Article 8 of the WCT.).
13
See Council Directive 2001/29/EC of 22 May 2001 On the Harmonisation of
Certain Aspects of Copyright and Related Rights in the Information Society, 2001 O.J.
(L 167/10), Art. 3. See also Mihly Ficsor, The Right of Communication to the Public
and the Making Available Right (on file with author). Article 3(1) of the Directive
2001/29/EC of the European Parliament and of the Council of May 22, 2001, on the
harmonisation of certain aspects of copyright and related rights in the information
society, in a way, is only a slightly adapted version of Article 8 of the WCT as it reads
as follows: Member States shall provide authors with the exclusive right to authorise
or prohibit any communication to the public of their works, by wire or wireless means,
including the making available to the public of their works in such a way that
members of the public may access them from a place and at a time individually chosen
by them. The recitals concerning this provision clarify that it includes two elements.
Recital (23) refers to the need for harmonizing the provisions on communication to
the public in general: This Directive should harmonise further the authors right of
communication to the public. This right should be understood in a broad sense covering all communication to the public not present at the place where the communication
originates. This right should cover any such transmission or retransmission of a work
to the public by wire or wireless means, including broadcasting. This right should not
cover any other acts. Recital (25) addresses the issue of on-demand transmissions in
respect of copyright: The legal uncertainty regarding the nature and the level of
protection of acts of on-demand transmission of copyright works and subject-matter
protected by related rights over networks should be overcome by providing for
harmonised protection at [the] Community level. It should be made clear that all
rightholders recognised by this Directive should have an exclusive right to make
available to the public copyright works or any other subject matter by way of interactive on-demand transmissions. Such interactive on-demand transmissions are characterised by the fact that members of the public may access them from a place and at a
time individually chosen by them.
49
law to implement the two treaties and was in the process of negotiating Free
Trade Agreements (for example with Singapore) that expressly included the
requirement to provide authors and right holders with an exclusive right to
make available works (and objects of related rights).
Global Implementation of Article 8 of the WCT and Articles 10, 14, and
15 of the WPPT
Globally, the number of implementations has grown markedly in the past
several years, whether they be by changes to domestic legislation (or proposed
changes), by commitments through bilateral agreements (most notably
through Free Trade Agreements entered into between several countries and the
United States), by interpretation, and by self-implementation (that is, through
accession to the treaties as superior law). As of April 2008, at least 96 countries/territories have, committed to have, or are in the process of legislating to
add, interactive rights of communication to the public/making available or
provide such rights by interpretation. Of those 96 countries/territories, 77
provide WPPT-compatible making available rights for producers of sound
recordings and/or performers, or had draft legislation providing such rights.14
There are several others that have broad interpretations consistent with the
treaties or that implement the treaties provisions through self-execution (for
example, Ghana, Guinea).
Anecdotal Implementation Data (keying on Asia)
Anecdotally, there seem to be four different implementation scenarios:
Countries that provide fully or near fully treaties-compatible rights as to
works and objects of related rights (examples are Australia and in Asia
include Brunei Darussalam, Cambodia, Hong Kong,15 Japan, Malaysia,
Papua New Guinea, Singapore, and Taiwan).16
14
Draft legislation: Oman (legislation awaits signature by the Sultan),
Swaziland, the Philippines, Thailand, Macedonia (Former Yugoslav Republic of), and
Kuwait have draft legislation that, if enacted, would provide an interactive making
available to the public right. Indias 2006 HRD draft would provide such a right. FTAs:
Panama (once FTA goes into force) and Colombia (if approved) would be obligated to
provide making available rights as to works and objects of related rights.
15
Hong Kong begins with the concept of distribution (similar to the US) but also
includes express language that largely mirrors the treaties. Copyright Ordinance
Section 26 (Cap 528) (2001). Section 26 of the Ordinance provides as to works (including sound recordings):
50
Countries that provide WCT-compatible rights but not WPPT-compatible rights, or vice versa (only Nepal from Asia falls into this latter category), or for which implementation of either is problematic or in
question in some way (examples in Asia are Indonesia, the Philippines,
Republic of Korea, Samoa, Sri Lanka, and Vietnam).
Countries that provide broad exclusive rights for works and/or objects
of related rights (for example, communication to the public and
broadcast rights) but no express interactive making available right
(examples are New Zealand and in Asia include Bangladesh, Bhutan,
Fiji, Mongolia, Pakistan, and Thailand).
Countries that provide no comparable rights to those in Article 8 of the
WCT and Articles 10/14/15 of the WPPT (examples in Asia include
Laos and Myanmar).
Implementation of Related Rights under the WPPT: Incomplete
Solutions for the Making Available Right
One problematic aspect in implementing the communication to the
public/making available right in the new digital environment is the treatment of related rights. Some countries have incompletely or improperly
defined the scope of the right, marring their implementation of the WPPT with
respect to related rights.17 Other countries have simply failed to implement the
(1) The making available of copies of the work to the public is an act restricted by
copyright in every description of copyright work.
(2) References in this Part to the making available of copies of a work to the public
are to the making available of copies of the work, by wire or wireless means, in such
a way that members of the public in Hong Kong or elsewhere may access the work
from a place and at a time individually chosen by them (such as the making available of copies of works through the service commonly known as the Internet).
(3) References in this Part to the making available of copies of a work to the public
include the making available of the original.
(4) The mere provision of physical facilities for enabling the making available of
copies of works to the public does not of itself constitute an act of making available
of copies of works to the public. The provision for performers is essentially the
same.
16
Taiwan has taken the approach of creating a new public transmission right
to satisfy the WIPO treaties. Taiwan Copyright Law, Art. 3(10). Taiwans approach
appears to adopt the broad communication to the public approach, but given the various exclusive rights in Taiwans draft law that together provide treaties-compatible
coverage, it can be said that Taiwans approach may be closest to Dr. Ficsors umbrella
solution, and may be an indicator that the notion of an umbrella solution remains
viable.
17
For example, some African countries that have implemented provide broad
exclusivity for communications to the public (including making available) for works
51
WPPT at all.18 For example, while Indonesias prompt ratification of the WCT
(the first country in the world to ratify the WCT, on 5 June 1997) set an excellent example, its 2002 Copyright Law failed to implement an interactive and
exclusive making available right as to sound recording producers and
performers. Indonesia has since joined the WPPT in 2005, but is yet to draft
implementing regulations for the WPPT.
Indonesia is not alone in its failure to properly implement the WPPT. Part
of some countries reluctance to act with respect to related rights may be a
reflection of the uncertain outcome at the 1996 Diplomatic Conference, specifically, the inability of the delegations to completely resolve all the issues
related to rights to be afforded to producers of phonograms and performers in
the networked (for example, Internet) environment. Specifically, the delegates
at the Conference adopted an agreed statement in connection with Article 15
of the WPPT. It reads as follows:
It is understood that Article 15 does not represent a complete resolution of the level
of rights of broadcasting and communication to the public that should be enjoyed
by performers and phonogram producers in the digital age. Delegations were unable
to achieve consensus on differing proposals for aspects of exclusivity to be provided
in certain circumstances or for rights to be provided without the possibility of reservations, and have therefore left the issue to future resolution.
This agreed statement reflects the discussions and negotiations about the socalled near-on-demand forms of broadcasting and communication to the
public by cable, such as subscription services. In respect of such services, the
demand of rights owners seems to be quite justified that, at least a right to
remuneration should be granted, but in cases where such services most seriously conflict with a normal exploitation of the rights in phonograms, an
exclusive right should be considered.19 What is clear is that the making avail-
but provide an incomplete approach to related rights, affording exclusivity only with
regard to making available for producers of sound recordings and performers, and
creating a right to a single remuneration for other communications to the public and
broadcasts. See, e.g., Botswana, Copyright and Neighbouring Rights Act (2000) (A.
19), 26(1); Tanzania, The Copyright and Neighbouring Rights Act, No. 6 (1999),
33; Burkina Faso, Law No. 032-99/AN Law for the Protection of Literary and Artistic
Property (1999), 79.
18
While beyond the scope of this chapter, another area in which implementation
strategies differ, but in which mistakes can be very costly to the system and leave countries out of compliance, is in the area of exceptions and limitations on the rights granted
in the WCT and WPPT with respect to communications to the public and the making
available of works or objects of related rights.
19
An example of existing legislation trying to respond to such a demand may be
found in 106(6), 114(a) and 114(d) to (j) of the US Copyright Act.
52
able right in Article 14 is to be considered a starting point for countries implementation approaches, not an end point. It would be unfortunate to stifle new
ways of distributing copyright materials in these countries, including subscription services, interactive or on-demand services, or near-on-demand services, by
enacting only a making available right as to phonograms, without considering
levels of exclusivity that ought to be granted to right holders in such cases.20
20
Express rights for record producers and performers in the online environment (as for other right holders) can provide economic rationales for investment in
the creation of recorded music (and other subject matter). In an environment increasingly dominated by digital transmissions rather than product delivery, and by an
increasing variety of methods of distribution, it is important to address the level of
exclusivity to be afforded over interactive transmissions of recordings and performances uses that are fast becoming the central economic uses of recordings and
performances.
21
Universal Music Australia Pty Ltd v Sharman License Holdings Ltd [2005]
FCA 1242 (5 September 2005).
22
The court noted three factors supporting a finding of secondary (authorization) liability: (1) defendants knowledge that the system was being widely used for
the sharing of copyright files; (2) failure to take any action to implement technical measures (keyword filtering and gold file flood filtering) that would enable the
respondents to curtail although probably not totally to prevent the sharing of copy-
53
54
55
Canada
In BMG Canada Inc. v John Doe (F.C.),29 the Federal Court of Canada denied
issuing a court order to turn over records of P2P file sharers partly on the
ground that the plaintiffs (record companies) had failed to make out a prima
facie case of copyright infringement. Plaintiffs alleged that defendants
installed a peer-to-peer application on their computers, copied files to shared
directories, used ISP services to connect their computers to the Internet, ran
the peer-to-peer application while on the Internet, and made files in the shared
directories available for copying, transmission and distribution to millions of
users of the peer-to-peer service. Specifically regarding the making available
right, the court held that there was no evidence that the alleged infringers
either distributed or authorized the reproduction of sound recordings [a]ll
they did was place personal copies into shared directories accessible by other
computer users. The Federal Court cited the judgement of the Supreme Court
of Canada in CCH Canadian Ltd. v Law Society of Upper Canada30 for the
proposition that the provision of facilities that allow copying does not amount
to authorizing infringement. Interestingly, the court focuses on the missing
authorisation from which liability could have been found, noting, [h]ow is
what was done here different from a library placing a photocopier in a room
29
30
56
31
32
57
Japan
In what is known as the File Rogue case, JASRAC (Japanese Society for
Rights of Authors, Composers and Publishers) v MMO Japan Ltd.,35 the
Tokyo District Court found MMO Japan Ltd. and its representative Michihito
Matsuda, who administered the peer-to-peer file-sharing service called File
Rogue, liable for copyright infringement of the rights of making copyrighted
works transmittable and public transmission of copyrighted works.36 One of
the issues the court considered was whether a sender who stores an MP3 file
in a share folder on his or her PC and connects to the defendants server
infringes the plaintiffs right of making copyrighted works transmittable.
The court held that the defendants service provides its users with an opportunity to exchange MP3 files, which are reproductions of commercially available recordings (CDs) [emphasis added]. More specifically, the court said, as
far as the exchange of MP3 files is concerned, the defendants service, in
effect, enables its users to freely send and receive MP3 files. [emphasis
added].37
Korea
Koreas seminal P2P cases involve the various iterations of the Soribada P2P
35
JASRAC v MMO Japan (Tokyo District Court, 29 January 2003), H17.3.31,
Tokyo Dist. Ct. No. 16 Ne 446 http://www.jasrac.or.jp/ejhp/release/2003/0129.html
(English-language summary) (awarding preliminary injunction against distribution of
FileRogue file-sharing program).
36
The case was continued to determine the scope of the injunction and the
amount of damages to be paid. In a provisional injunction applied by JASRAC in 2002,
the Tokyo District Court ordered MMO Japan not to allow the transmission of musical
works administered by JASRAC.
37
Another P2P case in Japan worthy of note involved the file-sharing service
called Winny. The Winny software was developed by Mr Isamu Kaneko to allow for
anonymous peer-to-peer file sharing. The anonymous system was styled after another
program called Freenet which purported to protect user identities to promote freedom
of speech, but Winny was advertised on an Internet bulletin board well known for propagating copyright infringement on the Internet. The bulletin board, 2channel, has been
cited in numerous press reports as a haven for copyright infringing activities. On 27
November 2003, police raided the home of Kaneko, known to Winny users as Mr
47, and shut down his Internet home page. On the same day, in separate raids, police
arrested two men for illegally distributing the Universal Studios film A Beautiful
Mind and for illegally distributing game software via Winny. On 13 December 2006,
the Kyoto District Court found Kaneko guilty of aiding and abetting the infringement
of Japans Copyright Law. See Motion Picture Association, Japanese File-Sharing
System Developer Guilty Of Abetting Copyright Infringement, 13 December 2006
(Press Rel.).
58
service and are instructive as to how communication to the public rights and
making available rights have become vital for right holders in practice. In the
case involving Soribada 3,38 an injunction was issued in 2005, among other
relief, ordering the founders of the Soribada P2P system to cease allowing
users of Soribada 3 to upload or download illegal MP3 files of the right holders. The key relevant issue in the case was whether the transmission right is
infringed by merely making available unauthorized copies of files in a shared
folder. The court found that making an MP3 file available for downloading by
other users after storing it on a shared folder requires only interfacing to the
network receiving IP addresses, etc. thus, no separate transmission is necessary.39 In a key legal holding regarding the making available right, the court
found that providing copyright material for use through wire communication
for receipt or use by other users who interface to the network of the Soribada
server anytime, anywhere [falls] under the infringement of the transmission
right under s. 1, Article 91 of the Copyright Act.40 Another key holding was
as follows:
MP3 files saved to their own download folders or those stored themselves in
the download folder shall be [deemed] stored in the shared folder for immediate
downloading by other Soribada users. This is tantamount to providing copyright
material for use through wire communication for receipt or use by other users who
interface to the network of the Soribada Service anytime, anywhere; thus falling
under the infringement of the transmission right of the Petitioner.
The founders of Soribada have since settled with many right holders and
launched Soribada 5 in July 2006 as a purportedly legitimate service charging
a monthly fee (currently 4,000 Won, or almost US$4), utilizing audio fingerprint technology to identify tracks and technology to filter out unlicensed
38
See Korean Association of Phonographic Producers v Soribada Co., Ltd.,
Case No. 2001 Kahab 3491, Seoul Cent. Dist. Ct., 50th Civ Div., 29 August 2005
(Soribada 3). The Soribada services (Soribada 15) have changed over time, each
becoming less centralized than the one before it. In Soribada 1, the defendants were
found contributorily liable for the infringements of their third party customers; the
service they provided was a website in which thousands of songs were indexed and
hyperlinked to IP addresses at which the various files could be downloaded. See
Korean Association of Phonographic Producers v Soribada Co., Ltd., Case No. 2002
Kahab 77, Suwon Dist. Ct., 9 July 2002, affd Seongwan [sp] Branch Ct. (14 February
2003), affd in part, Seoul High Court (12 June 2005), Case No. 2003 11a2 1140
(Soribada 1). In Soribada 2, the defendants removed the hyperlinks to the IP addresses,
but still retained an index on the site (resembling the architecture and business model
which was struck down as illegal in the US Napster litigation).
39
Soribada 3, at 1(a)(2)(a).
40
Id. at 2(b)(2)(b).
59
41
As of January 2008, Soribada was reportedly the second largest music service
provider in Korea with 700,000 paying subscribers. See Soribada, at
http://en.wikipedia.org/wiki/Soribada. Soribada claims to have licensing deals with
almost all local labels, with the exception of Seoul Records, which is owned by SK
Telecom, Soribadas main rival in the online space. Among foreign labels, Soribada
says it has a deal with Universal Music and that it is about to close deals with Sony
BMG, EMI and Warner Music. See Mark Russell, Soribada Gets OK For Legal P2P
Service, 13 March 2008, at http://www.billboard.biz/bbbiz/content_display/industry/
e3i276690244f41c8186be5e51e3a031b19.
42
The new Section 104(1) provides specifically,
An online service provider whose service involves peer-to-peer use between
different peoples computers, for which the main purpose is the transmission of
works (hereinafter referred to as a special type of online service providers), shall,
at the request of relevant right holders, be required to take technical measures,
including those to block illegal transmissions. In this case, the necessary measures
to be taken at the request of relevant right holders shall be determined by the details
of a Presidential Decree.
43
Ministry of Culture and Tourism Public Notification No. 2007-24.
44
See Statement from John Kennedy, Chairman and Chief Executive of IFPI, on
todays Yahoo! China ruling, 24 April 2007, at http://www.ifpi.org/content/
section_news/20070424a.html.
60
had no problem finding Yahoo! China liable for linking to illegal downloads
of copyrighted music,45 and the company was ordered to pay a fine of 200,000
Yuan and remove the links. On 20 December 2007, the Beijing High Court
upheld the lower courts decision.46 Yahoo! China failed to comply and faced
legal action again in February 2008 to enforce the December court order. The
Yahoo! China case was decided under the 2006 Regulations on the Protection
of the Right of Communication through Information Networks (1 July 2006)
(2006 Internet Regulations).
The Yahoo! China case stands in contrast with litigation brought by record
companies against the major Chinese search engine Baidu in 2005 under the
Copyright Law prior to the 2006 Internet Regulations. In November 2006,
the Beijing Intermediate Peoples Court found no liability for copyright
infringement, holding the search engines deep links did not constitute an
infringement [by Baidu] as all the music was downloaded from web servers of
third parties.47 The record companies appealed but the Beijing High Court
upheld the lower courts decision on 20 December 2007 (the same date as the
decision affirming the Intermediate Courts decision holding Yahoo! China
liable). However, as the Baidu decision was based on the state of the law prior
to the issuance of the 2006 Internet Regulations, on 4 February 2008, record
industry groups filed new civil suits against Baidu and also Sohu/Sogou for
their music deep linking services. A similar case brought by Hangzhou-headquartered online music service 5fad was likewise unsuccessful.48
45
Mike Rosen Molina, China court rules Yahoo! China violated copyright by
linking to filesharing sites, 24 April 2007, at http://jurist.law.pitt.edu/paperchase/
2007/04/china-court-rules-yahoo-china-violated.php.
46
However, the Yahoo injunction only extended to a few songs and the resulting damages were extremely low. Chinese officials responsible for drafting the
Regulations on the Protection of the Right of Communication through Information
Networks (Internet Regulations) that became effective on 1 July 2006 have stated that
under Article 23 of those regulations, ISPs are liable for deep linking.
47
See Baidu off the hook in copyright infringement case, 20 November 2006, at
http://digitalmusic.weblogsinc.com/ 2006/11/20/baidu-off-the-hook-in-copyrightinfringement-case/.
48
See Gareth Powell, 5fad loses copyright case against Baidu, China Economic
Review, 13 January 2007, at http://www.chinaeconomicreview.com/it/2007/
01/13/5fad-loses-copyright-case- against-baidu/. More deeplinking and Internet-based
infringement cases are sure to follow. For example, on 3 February 2008, Xunlei, one of
Chinas largest download service providers, lost a piracy suit and was ordered to pay
150,000 Yuan (US$20,833) compensation to Shanghai Youdu Broadband Technology
Co. (Youdu), according to the Pudong District Peoples Court. Youdu, a content
provider for broadband users, paid 600,000 Yuan to get rights to Confession of Pain,
a blockbuster film starring Tony Leung and Takeshi Kaneshiro, from the copyright
owner on 28 December 2006, six days after it debuted. Youdu was allowed to provide
61
Taiwan
As with China, the seminal cases in Taiwan involve P2P file-sharing programs
aiding and abetting users to download illegally, but the courts in these cases
did not directly address the making available right. On 9 September 2005, the
Taipei District Court convicted three executives of Kuro, Taiwans largest filesharing service, for criminal copyright infringement.49 The court spokesman
indicated, Kuro had violated copyright law in offering its members programs
to download MP3 music. The service was run as a commercial subscription
business, with an estimated 500,000 registered users in Taiwan and mainland
China, causing enormous losses to the music industry in both places.50 The
court found that Kuro ran advertisements that had encouraged members, who
a download service one month after the films debut, according to the agreement.
Youdu planned to charge 2 Yuan a download. However, a download link for the film
appeared on Xunleis website (www.xunlei.com) in early January 2007. By 4 January
2007, the film had been downloaded 520,869 times. In defense at court, Xunleis attorney claimed his client provided only a third-party link for the film and did not violate
Youdus rights. The court said Xunlei objectively participated and helped the thirdparty website to disseminate the pirated film and promoted the film on its website.
There are reportedly seven or more MP3 search engines that offer deep links to
thousands of infringing song files and derive advertising revenue from doing so
(accounting for the majority of online piracy in China) and over a dozen Chinese-based
P2P services engaging in file sharing activities, including Muper, Kugoo, Xunlei and
eMule.
49
Sentences ranged from two to three years in jail and fines for criminal copyright infringement. In addition, one of Kuros 500,000 paying members was sentenced
to four months imprisonment for making 900 songs available for upload.
50
In a subsequent development, the Taiwan International Federation of the
Phonographic Industry and Kuro reached a settlement on 14 September 2006, whereby
Kuro agreed to discontinue its file-sharing function by 15 October 2006, and would
cease distribution of P2P software, as well as pay NT$300 million (approx. US$9
million) in damages to record businesses. Kuro has approximately five million
members in China and Taiwan. Without obtaining distribution rights, Kuro collected a
monthly fee from its members for use of P2P software for illegal file sharing; it was the
largest website of its kind in Taiwan, and caused enormous financial damage to rights
holders. In August 2003, IFPI Taiwan filed for a preliminary injunction against Kuro,
prohibiting the illegal file sharing of the 105 songs owned by member rights holders;
then, on 4 December of the same year, the Taipei District Prosecutors Office brought
charges against Kuro for copyright infringement and commenced public prosecution.
See, e.g., Taiwans Kuro in substantial settlement with recording industry, 16
September 2006, at http://www.ifpi.org/content/section_news/20060914.html. The
Kuro case contrasted with an earlier case in which Shihlin District Court found Weber
Wu, president of EzPeer, a P2P file-sharing service, not guilty of criminal copyright
infringement. See Jessie Ho, Ezpeer found not guilty in landmark copyright verdict,
Taipei Times Online, 1 July 2005, at http://www.taipeitimes.com/News/front/archives/
2005/07/01/2003261705.
62
paid a monthly fee of NT$99, to swap copyrighted music files via its site, and
therefore held that Kuro was a party to infringement of the Copyright Law.51
United States
The Congressional drafters in the United States (and those advising them) did
not deem it necessary to amend US law (specifically, 106(3)) to explicitly
include the making available language from the WCT/WPPT, and advisors
have since confirmed the existence of a making available right under US
law.52
The early Internet and P2P cases did not key on the making available right
as there were either clear violations of the reproduction right (MP3.com) or,
with the main targets in those cases being services (for example, Napster,
Grokster), alleged facilitating infringement by third parties. As can noted
below, making available was presumed to be an infringement in Napster,
and, in Grokster, the Supreme Court at least implied that making files available constitutes distribution.
In more recent cases involving recording company suits against individuals
for illegal P2P file sharing, defence counsel facing clear-cut cases against
their clients for unlawful reproductions have waged some spirited defences
against the recording companies, claiming that US law does not in fact provide
a making available right, at least not without proof of an onward distribution.
The decisions on this claim have cut both ways.
51
See Taiwanese Criminal P2P Convictions Set the Example, 11 September
2005, at http://constitutionalcode.blogspot.com/2005/09/taiwanese-criminal-p2pconvictions-set.html. The Kuro case stands in contrast with the earlier District Court
ruling in a criminal action against Weber Wu, owner of the P2P site EzPeer. On 1 July
2005, the Taipei District Court found EzPeer not guilty of engag[ing] in reproducing
or publicly distributing works of copyright holders. More recently, EzPeer and Kuro
reportedly jointly launched a legal music site, called Kuro, in mainland China. See
http://www.billboard.biz/bbbiz/content_display/industry/e3i4666d48f49725610e21ab
472aba9283d.
52
Register of Copyrights, Marybeth Peters, in a letter to Congressional hearings
on piracy of intellectual property on peer-to-peer networks, said, making [a work]
available for other users of [a] peer to peer network to download ... constitutes an
infringement of the exclusive distribution right, as well as the reproduction right.
Letter from Marybeth Peters, Register of Copyrights, to Rep. Howard Berman, from
the 28th Dist. of Cal. (25 September 2002), reprinted in Piracy of Intellectual Property
on Peer-to-Peer Networks, Hearing Before the Subcommittee on Courts, the Internet,
and Intellectual Property of the House Committee on the Judiciary, 107th Cong., 2nd
Sess. 114115 (2002).
63
53
To the question of how the secondary liability standards in the US were
applied in the case, in the Opinion affirming the Appeal from the Motion to Modify the
Preliminary Injunction against Napster, Judge Beezer of the Ninth Circuit affirmed the
modified preliminary injunction, obligating Napster to remove any user file from the
systems music index if Napster has reasonable knowledge that the file contains plaintiffs copyrighted works. Plaintiffs, in turn, must give Napster notice of specific infringing files.
64
54
1997).
Hotaling v Church of Jesus Christ of Latter-Day Saints 118 F.3d 199 (4th Cir.
65
the 4th Circuit found that placing unauthorized copies of books and an index
of them for users to check out from a library constitutes an infringement of the
distribution right under 106(3) of the US Copyright Act.
Of even more persuasive effect is the Supreme Courts decision in New
York Times Co. v Tasini, 533 US 483, 488 (2001), which held that, notwithstanding absence of proof that individual copies of plaintiffs articles on defendants database were transferred to users of the database, it is clear that the
defendants distribute copies of the plaintiffs articles merely by making them
available for download.55 The Court rejected the defence that there was no
distribution under US law by the defendants as it was the database subscribers
who were responsible for the downloading.56
Despite such legal precedents, defendants lawyers have waged strong
defences in ongoing cases involving individual P2P file sharers brought by the
record companies, claiming that US law does not in fact provide a making
available right, at least not without proof of an onward distribution. The cases
cut both ways: some courts have found that the distribution right under
106(3) of the US Copyright Act encompasses the act of making copyrighted
materials available for electronic distribution on a peer-to-peer network,
regardless of whether actual distribution has been shown; other courts have
decided that a 106(3) claim cannot stand on the grounds that plaintiffs have
failed to show an onward distribution.
The following is a small sample of cases in which a making available
right or its equivalent was found in US law:
Elektra Entertainment Group Inc. et al v Barker, Case No. 7:05-cv07340-KMK (S.D.N.Y.) (Opinion and Order, 31 March 2008). In an
Order denying defendants motion to dismiss for failure to state a claim,
Judge Kenneth Karas agreed that distribution under 106(3) is essentially synonymous with publication, noting it is unsurprising that
courts faced with similar allegations as in this Complaint have looked to
the definition of the word publication in 17 USC 101 to construe the
definition of the word distribute in 106(3). The court held that the
offer[] to distribute copies or phonorecords to a group of persons for
purposes of further distribution, public performance, or public display,
55
Id. at 498, 505. ([w]e further conclude that the Print Publishers infringed the
Authors copyrights by authorizing the Electronic Publishers to place the Articles in the
Databases.)
56
Thomas D. Sydnor II, Thomas and Tasini: Did the Making-Available Debate
End Before It Began?, Progress and Freedom Foundation, Progress Snapshot, Release
4.13, June 2008 (e-mail publication) (pointing out that plaintiffs asserted that their
copyrights were infringed when their articles were placed in these databases).
66
17 USC. 101, can violate the distribution right of s. 106(3). The judge
specifically equated distribution with publication but said that the plaintiff needed to re-allege the claim using the proper wording.
Motown Record Co. v Theresa DePietro, Civ. No. 04-CV-2246, 2007
US Dist LEXIS 11626 (E.D. Pa.16 February 2007), at 7.57 In this case
involving a downloader using the Kazaa software, Judge Cynthia Rufe
of the Eastern District of Pennsylvania stated, [a] plaintiff claiming
infringement of the exclusive distribution right can establish infringement by proof of actual distribution or by proof of offers to distribute,
that is proof that the defendant made available the copyrighted
work.[38] Footnote 38 continues, [w]hile neither the United States
Supreme Court nor the Third Circuit has confirmed a copyright holders
exclusive right to make the work available, the Court is convinced that
17 USC 106 encompasses such a right based on its reading of the
statute, the important decision in A&M Records, Inc. v Napster, Inc.,
239 F.3d 1004 (9th Circuit 2001), and the opinion offered by the
Register of Copyrights, Marybeth Peters, in a letter to Congressional
hearings on piracy of intellectual property on peer-to-peer networks
([M]aking [a work] available for other users of [a] peer to peer network
to download ... constitutes an infringement of the exclusive distribution
right, as well as the reproduction right).
Atlantic Recording Corp. v Anderson, No. H-06-3578, 2008 WL
2316551 (S.D. Tex. 2008): Summary judgment was granted for plaintiffs, as defendant placed songs into a shared folder to be distributed.
The court found that distribution has been equated with publication
which includes the offering to distribute copies or phonorecords to a
group of persons for purposes of further distribution..., and making
copyrighted works available for download via a peer-to-peer network
contemplates further distribution, and thus constitutes a violation of the
copyright owners exclusive distribution right.
The following is a small sample of cases in which a making available right
or its equivalent was not found without a showing that there was an onward
distribution (although London-Sire v Does paves the way for a deemed distribution theory to succeed; that is, that there can be a reasonable inference
drawn from the facts in a plaintiffs favour such that the reasonable fact-finder
may infer a distribution actually took place):
57
67
In the most recent case, Capitol Records Inc., v Thomas (D. Minn. 2008),
Civil File No. 06-1497 (MJD/RLE) (Memorandum of Law & Order of
September 24, 2008), District of Minnesota Chief Judge Michael Davis
ordered a new trial, overturning a 4 October 2007 federal jury award of
$220,000 in damages to plaintiffs caused by defendant Thomass downloading
1,702 songs through the Kazaa network (though only 24 were at issue in the
case and subject to statutory damages). The new trial was ordered since it was
unclear whether jurors found liability based on Jury Instruction Number 15
([t]he act of making copyrighted sound recordings available for electronic
distribution on a peer-to-peer network, without license from the copyright
owners, violates the copyright owners exclusive right of distribution, regardless of whether actual distribution has been shown) or based on the actual
infringement (either reproduction or circumstantial evidence of actual
dissemination which the defendant carried out and which was completed
when MediaSentry [the firm hired by right holders to collect evidence of
infringement] downloaded the files). Judge Davis implores Congress to enact
a legislative fix (which it should be noted could be done by adding or offer to
68
58
See, e.g., United States v Shaffer, 472 3d 1219 (10th Cir. 2007) (placing child
pornography in a shared folder, and nothing more, constitutes distribution under 18
USC 2252A, and there is no requirement to show an actual download).
69
Indeed, with the damage caused by illegal file sharing to date, the future for
copyright industries, and the music industry which has borne the brunt of illegal file sharing most acutely thus far, will depend on the preservation of longstanding legal principles of copyright liability in the online space, including
against P2P infringements and unauthorized acts of making available. The
further elaboration in case law (or statute if necessary) of secondary liability
principles (or the development of such principles where none exist or where
they remain under-developed) will likewise be crucial to healthy development
of copyright protection online.59
In addition, there can be little doubt that increasing cooperation of service
providers will be crucial to preserving a legal Internet market. President
Sarkozys 22 November 2007 announcement of the Olivennes Report seemed
to hold some promise for a new day of cooperation and compromise between
service providers and copyright owner interests.60 Under the plan, ISPs agreed
that they would monitor what their customers are doing and pass on information about persistent pirates to a new independent body in France, with those
identified getting a warning and then being threatened with either having their
Internet access cut off or suspended if they do not stop illegal file sharing. In
exchange, right holders agreed to do more specifically, film-makers agreed
to speed up the transfer of movies to DVD and music firms pledged to support
DRM-free tracks on music stores. The Gowers Report in Britain61 and the
Renfors Report in Sweden62 both have also recommended to government that
59
See Dixon, Liability of Users and Third Parties for Copyright Infringements
on the Internet: Overview of International Developments.
60
Industries have recently noted some progress in cooperation among governments and in courts in Sweden, Belgium, the UK, the US and Asia.
61
Gowers Review of Intellectual Property, December 2006 (HM Treasury on
behalf of the Controller of Her Majestys Stationery Office), at http://www.hmtreasury.gov.uk/media/6/E/pbr06_gowers_report_755. Specifically, Recommendation
39 provides,
Observe the industry agreement of protocols for sharing data between ISPs and
rights holders to remove and disbar users engaged in piracy. If this has not proved
operationally successful by the end of 2007, Government should consider whether
to legislate.
62
The report, by Swedish Justice Department investigator Cecilia Renfors,
proposes a change in Swedish law so that ISPs would be obliged to take action to terminate the contracts of certain users who repeatedly use their connection to infringe copyright. This obligation could be enforced in court by right holders. According to the
Swedish Ministry of Justice,
It is proposed that the law be amended so that Internet Service Providers can be
ordered, under penalty of a fine, to take action such as terminating the contract of a
subscriber to prevent continued infringement using the Internet Service Providers
services.
70
ISPs should disconnect persistent infringers, by voluntary agreement if possible or legislation if not. A recent Belgian court ruling in the SABAM v Tiscali 63
case concluded ISPs should address mass copyright infringement and that they
had the means to do so.
However, on 10 April 2008, the European Parliament64 sent a message to
France that its brokered deal was unacceptable. Specifically, para. 23 of the
European Parliament resolution of 10 April 2008 on cultural industries in
Europe states in relevant part, [t]he European Parliament calls on the
Commission and the Member States, to avoid adopting measures conflicting
with civil liberties and human rights and with the principles of proportionality,
effectiveness and dissuasiveness, such as the interruption of Internet access.
So, we are at an impasse in Europe. Meanwhile, digital sales are weak in
France due to high levels of unauthorised file sharing which prompted the
Sarkozy plan for action against piracy by ISPs. With high levels of unauthorized file sharing in other parts of Europe, it is perhaps surprising to see those
elsewhere battling the French on this point of preserving the Internet for legal
trade in cultural products. Yet, all agree that ISPs are the gatekeepers of the
Internet, and as such, the question of how vital a role they must play in curbing copyright abuse will remain a vital question for years to come.
The report entitled Music and Film on the Internet Threat or Opportunity? was
produced in response to a request from Swedens Justice Minister. See IFPI welcomes
Swedish report calling on ISPs to tackle copyright Infringement, 5 September 2007, at
http://www.ifpi.org/content/section_news/20070905.html.
63
SABAM v Tiscali, No. 04/8975 A of the General Roll (D. Ct. Brussels 28 June
2007).
64
European Parliament Resolution of 10 April 2008 on cultural industries in
Europe (2007/2153(INI)). para. 23 states in relevant part, The European Parliament
calls on the Commission and the Member States, to avoid adopting measures conflicting with civil liberties and human rights and with the principles of proportionality,
effectiveness and dissuasiveness, such as the interruption of Internet access.
71
72
73
Unlike a surface link that connects the user to the linked sites homepage,
a deep link connects the user to an interior page of the site, that is, any web
page other than the homepage. An HTML command makes it also possible to
present the content of a linked sites web page inside the frame of the linking
site; in other words, the frame of the linking site will replace the frame of the
linked site on the users screen. With this type of link, the title of the page
(above the toolbar) and the address of the linking site (in the address box) are
not replaced by the title and address of the linked site. Therefore, even if users
usually realize that they are browsing the content of another site, the browser
does not display (solely) the URL of the linked-to site. With inlining or embedded links (also referred to as a dynamic or automatic links), an element
(such as an image, a graphic, a logo, etc.) from another web page (belonging
to the same or another site) can be inserted into a web page without leaving
the page of the linking site. As an image (or any other embedded element) is an
independent part of a web page, it has its own URL address, namely the place
on the server where the image has been stored in digital form. This instruction
takes the form of an HTML command giving the images URL address.8 The
fact that the link is activated automatically by the browser gives surfers the
impression that they are viewing an image from the web page that they are
browsing while the image actually comes from another web page.9 Thus, an
embedded link enables a site operator to insert images without having to copy
them. Indeed, the image is not reproduced at any time on the server hosting the
linking site. The image is only reproduced (in a lasting form) on the server on
which the originating site is stored and (in a temporary form) on the screen of
the surfer visiting the page containing the embedded link. This technique saves
space on the server hosting the page containing the embedded link.
It is not only linking techniques that can have an impact on third party liability. Other distinctions between hyperlinks (which overlap in part those that have
just been presented) should be considered such as where the linked page is
located,10 whether the link must be activated by the Internet user, and the
extent to which the origin of the linked material is visible.
8
The basic HTML command used to find the image on the server is <IMG
SRC=URL of the GIF or PEG file>. For example, if one wants to include a picture
of a Coca-Cola bottle on a page, all one has to do is include the command <IMG
SRC=http://www.cocacola.com/images/bottle1.gif> in the web pages HTML code.
Such use of protected images such as the Coca Cola bottle are submitted to rights
holders consent.
9
Even more so as the URL address of the site from which the image originates
will not be displayed in the space where the URL address of the page opened is usually
displayed (or where the URL address to which the user wants to go is entered).
10
Is it an Intra-page hyperlink, that is, a link that refers to a URL address situated on the same web page as the linking one; an Internal hyperlink, which refers to
74
a URL address situated on a different web page from the linking one, but on the same
web site; or an External hyperlink, which refers to the URL address of another web
site?
11
See discussion of KODA, NCB, Dansk Artist Forbund, Dansk Musiker
Forbund & IFPI Denmark, Case Nos. V.L. B-1943-99 and V.L. B-2089-99 (High Ct.
of Justice, Western Div., 20 April 2001) infra.
12
Article Art. 10 ECHR: Everyone has the right to freedom of expression. This
right shall include freedom to hold opinions and to receive and impart information and
ideas without interference by public authority.
75
76
illustrated by the difference between Googles search engine service (automatic search and ranking of links based on a computer algorithm, PageRank)
and the Google.News service (retrieval and organization of online news that
comes closer to publishing).
The law in the area of third-party liability derives from a number of
sources: statutory rules specific to the copyright area, case law developments
in copyright, and more general common law or civil law legal rules. A clear
distinction can be made between the principles followed under US case law
and those applicable in civil law jurisdictions. In the US, third-party liability
for copyright infringement generally falls under one of three heads: (1)
contributory liability; (2) vicarious liability and (3) inducement liability.13
These different grounds will be analysed below. In a civil law setting, the relevant concepts are: (1) knowing assistance, self explanatorily where a third
party knowingly assists in the copyright infringements of another; and (2)
breach of a duty of care, which necessitates an illegal act and third-party
knowledge and takes into consideration any economic benefit to the third
party and its magnitude relative to any costs.
Regarding liability for copyright infringement in relation to linking, three
possible types of situations can be distinguished: cases where the infringement
relates to the use of the pointer (or a collection thereof), cases where the
infringement results from the linking technique or process used, and cases
where the infringement is caused by the content of the linked site. While the
first two types of cases can raise direct copyright liability (see below), the third
type of case only involves secondary copyright liability (see p. 88).
77
online services, a recent Belgian case dealing with the same issue of the use of
headlines for linking involves a group of newspapers opposing a news aggregating service, a typical Web 2.0 service.
Shetland Times v Wills14 In this Scottish case, the defendant, Dr Jonathan
Wills, ran an online news service called the Shetland News, which provided
links to the site of the Shetland Times. The Shetland News reproduced on its
web site the headlines of stories published in the print version of the Shetland
Times and on the latter newspapers web site. The plaintiffs web site was not
financed by advertising, but the defendants site carried advertising banners.15
Users who visited the defendants site could click on the headlines, copied
verbatim from the Shetland Times, and then find themselves on the Shetland
Times site, at the page on which the story was posted.
The newspaper brought an action for an interim injunction for copyright
infringement, alleging in particular an infringement of copyright in the headlines. In his order of 24 October 1996, the judge hearing the case held that it
was probable that certain headlines particularly the long ones consisting of
eight words or more enjoyed copyright protection as literary works and that
consequently there was prima facie illegal copying.16 In weighing the opposing interests, the judge stressed that it was essential for the plaintiff that its web
site should be accessible only through its homepage.
The case did not end there. On 11 November 1997, the first day of the trial
hearing, the parties came to a settlement under which the Shetland News was
allowed to link to Shetland Times stories using the headlines as pointers
subject to certain conditions:
The link had to be acknowledged by the legend A Shetland Times
Story placed underneath the headline used as pointer;
The Shetland Times logo had to be featured on a button adjacent to the
pointer; and
The legend and the button had to be hypertext links to the title page of
the Shetland Times site.
This case confirms the principle that web-linking is authorized in principle
unless the linking is done in a manner that is prejudicial to the owner of the
linked to site.17
14
Shetland Times Ltd v Jonathan Wills and Another 1997 SLT 669 (24 October
1996).
15
16
17
78
79
information has to be reported does not enable the prior consent of the author
to be sought is not present in this case as Google could obtain the agreement
of the publishers of the indexed web sites in advance.
Googles argument based on the protection of freedom of expression (Art.
10 ECHR) was also rightly rejected by the Brussels Court who considered that
the freedom to receive and to communicate information can be limited in order
to protect copyright, and that the restriction prescribed by the copyright law
was appropriate and proportionate in this case. Also, the Court points out that
the system put in place by Google.News does not involve any human element
as Google does not employ any chief editor to select the articles put on the
Google.News page. Rather, the service is based on the automatic indexing by
the GoogleBot robot of the press articles made available on the Internet. The
Court seems to consider that freedom of expression has no real bearing in such
context.
The plaintiff thus obtained an injunction against Google that has forced
Google to refrain from indexing the articles of Copiepresse members. As an
appeal is pending while a settlement is still under negotiation to eventually
determine a fair remuneration for this reproduction, access to the articles has
been allowed by Copiepresse members, who saw a sharp decline in consultation once their online pages were cut off from Google.News service.
Copyright is used here to ensure compensation is paid for the investment made
in creating the protected content.
Where images or other visual material (logos, etc.) are used as pointers,
they may well enjoy copyright protection, and thus, the hyperlinks may
infringe copyright. This was the issue with which the visual search engine
Arriba was confronted. As pointers, Arriba used reduced versions of images,
thumbnails, corresponding to the word entered in the search.20 As the case
also involves the issue of the linking technique, it will be addressed below.
A collection of unprotected hyperlinks (pointers)
The taking of a directory or collection of links comprising of non-protected
elements, such as http addresses, could raise legal issues as well. While an http
address on its own cannot enjoy copyright protection,21 a list of web addresses
20
Kelly v Arriba Soft Corp., 77 F. Supp. 2d 1116 (C.D. Cal. 1999). For further
discussion of this case, see infra infringements involving the use of pointers and linking techniques at p. 84.
21
Some elements of such an address can however be registered as trademarks
(for example, a trademark can protect amazon.com, not only the second level domain
name amazon), but using those protected signs as pointers to the official web site of
the trademark owner cannot be considered as objectionable trademark use under the EC
trademark rules.
80
that is drawn up either in a reasoned manner (the case of directories that select
sites or links from spontaneous registrations by site operators) or automatically (the case of search engines) may, on the other hand, be eligible for
protection. To consider this question, it is interesting to compare a set of
hyperlinks to an index, or bibliography. In an index, the establishment of a link
between one entry and other words, which may themselves be used as entries
in the index, cannot as such be appropriated by copyright. What is involved
here is an association and thus a non-copyrightable idea.22 Each link represents a piece of information that may have value in its own right but does not
achieve the required level of expression to be protected as a work.
By contrast, an index considered as a whole may be eligible for protection
as a compilation in that the selection of the words reproduced in it, but not
their arrangement as it is alphabetical as a rule, may be the result of an original creative effort or, in order to use the established expression, may constitute
the indexers own intellectual creation. All those who have had the pleasure of
compiling an index know that this work requires creative choices. In the same
way, a compilation of hypertext links may enjoy copyright protection, but it
will necessarily be limited in scope as it will concern the whole, or a substantial part of it, but not a particular hyperlink (element). A list of hyperlinks that
requires some substantial investment for collecting, verifying or presenting
them could potentially enjoy the sui generis protection conferred by the EC
Directive 96/9 on the legal protection of databases.
Infringements Involving Linking Techniques and Processes
Apart from the cases involving copyrighted pointers, the different linking
techniques identified above do not give rise to unlawful reproductions or
communication of works, and no direct copyright infringement is involved.
Indeed, the person creating a link never reproduces the linked document. This
principle has been confirmed in various decisions. As one court put it: hyperlinking does not itself involve a violation of the Copyright Act . . . since no
copying is involved.23
The only copies made are the temporary ones on the screen of the surfer
who activates the link, but those copies arguably are exempted from copy-
22
If one reasons in terms of US law, one could say that what is involved is a
discovery (of a conceptual link) which, under s. 102(b) of the Copyright Act, is
excluded from the scope of copyright protection. See also Feist Publns, Inc. v Rural
Tel. Serv. v Co., 499 US 340, 356 (1991) (copyright protection does not extend to facts,
which can be equated with discoveries).
23
Ticketmaster Corp. v Tickets.com, Inc., 54 USP.Q.2d (BNA) 1344 (C.D, Cal.
2000). See also IFPI v T. Olsson, and the Copyright Board of Canada discussed infra.
81
right.24 In the case of an embedded link, the situation is the same, except that
it is not the surfer, but the browser alone, that activates the link.
Framing and other contextual links
Things are a bit more complex in the case of framing. Indeed, under US law,
the question of whether the assembly of (copyrighted) components of the
linked site within the frame of the site of the provider of the link constitutes a
new work either a derivative work25 or a compilation26 is a matter of
debate. It is also a matter of fact that goes beyond the present contribution.
Another question is whether the provision of a hyperlink, particularly in the
form of framing, is not equivalent to an act of communication to the public
within the meaning of Article 8 of the WIPO Copyright Treaty of 20 December
1996, namely: the making available to the public of works in such a way that
members of the public may access these works from a place and at a time individually chosen by them.
We do not think this to be the case. As the work is already available to the
entire Internet community at the linked sites web address, linking cannot be
held as a new act of making available to the public. The link does not extend
the works audience: surfers who access the work by activating the link can
also consult the page directly, as long as they know its URL. Concluding that
there is a new communication to the public does not seem justified and would
cause considerable difficulties in terms of copyright management.
Framing raises other issues in countries with robust moral rights that
protect in particular the interest of the author to have the works integrity
protected. Some changes in the way the authors content is presented within
the frame and the advertisement of the linking site might affect its moral interests and might be objected to in some countries.
It is possible to imagine situations in which the mere change of context
between the linking site and the linked one could infringe the moral right to
24
In Europe, these temporary copies for browsing purposes are exempt from the
reproduction right under Art. 5(1) of the EC Directive 2001/29 on the harmonization of
certain aspects of copyright and related rights in the information society.
25
This claim was made by the plaintiff in a case involving framing. Without
deciding on this matter, the judge nevertheless considered in his order on the defendants motion to dismiss that such classification was not out of the question.
Futuredontics, Inc. v Applied Anagramics, Inc., 45 U.SP.Q.2d (BNA) 2005, 1998 US
Dist. LEXIS 2265 (C.D. Cal. 1998), available at http://eon.law.harvard.edu/property/metatags/1998futu.html (accessible on 28 March 2009).
26
This was argued by the plaintiff in Imax Corp. v Showmax Inc., 2000
A.C.W.S.J. LEXIS 47376 (Fed. Ct. Jan. 18, 2000) (Can.), available at
http://www.fja.gc.ca/fc/2000/ori/2000fc25888.html. The The court granted an injunction against the defendant, however, without taking a stand on this question.
82
the integrity of the work. Various courts throughout Europe have already ruled
that certain electronic uses that have the effect of severing the link between a
newspaper article and the newspaper to which it belongs could be detrimental
to the journalists personal and moral interests; the same reasoning could be
applied to framing, which isolates content from its graphic and ideological
online environment.
If we take a hypothetical case similar to Shetland Times,27 allowing the
journalists articles to be accessed from a linking site that does not share the
same ideology as the newspaper to which the link pointed might eventually
justify an action based on the journalists moral rights. In Belgium, the ruling
of the Brussels Court of Appeal in a case involving a central database (Central
Station) that was offering an online clipping service with all the articles
published in Belgium on selected topics went quite far in granting journalists
a right to be published within a specific context. According to the Court:
[I]t is true that a journalist writes for a readership as wide as possible, but within the
context of the newspaper or magazine that publishes his contributions (his newspaper or his magazine); and his article features with those of his colleagues who
work, under the same editor, for the same values, in the same publication.28
The Court added that compiling several articles reflecting different leanings
in a single collection, as in the case of the Central Station database, is a
change of perspective from that of informing the readership of a single newspaper, and that having authorized distribution intuitu personae on a medium
that reflects well-defined leanings does not imply that authorization has been
given for distribution on the Internet. The changes resulting from the link, for
example, a frame, or from the context, for example, advertising banners and
pop-ups, will be taken into account to assess whether the personal interests of
the author have been hurt.29 On top of the copyright argument relying on
27
28
Presented supra.
Brussels Court of Appeals, Oct. 28, 1997, Auteurs & Mdias, 1997, p. 383
(authors translation). See also the special issue of the Columbia-VLA Journal of the
Law & Arts: Symposium on Electronic Rights in International Perspective, 22
Colum.-VLA J.L. & Arts 127 (1998), and particularly Jane Ginsburg, Electronic
Rights in Belgium and France; General Association of Professional Journalists of
Belgium v Central Station (Brussels Court of First Instance, 16 October 1996;
Brussels Court of Appeals, 28 October 1997), Union of French Journalists v SDV
Plurimedia (Strasbourg Court of Grand Instance, 3 February 1998), 22 Colum.-VLA
J.L. & Arts 161 (1998).
29
In the same way, a models personality right allows the model to oppose his/her
photographs being made available in a prejudicial context. See Landgericht Mnchen I,
7 October 2004, 7 O 18165/03 (Playboy-Fotos) (possibility to oppose links and advertising banners associating the photos of a naked Playboy model with pornography).
83
moral rights, other claims based on other bodies of law (unfair competition,
passing-off, etc.) could be raised to oppose framing or other contextual
changes, but those arguments are well beyond the scope of the present contribution.
Embedded links
One must also be more cautious when dealing with embedded links. Indeed,
in such cases, visitors do not realize that they are consulting a document that,
in fact, comes from another site. At any rate, visitors are given the impression
that it is the provider of the embedded hyperlink who is communicating the
work to the public. It is easier to hold the provider of an embedded link liable
for contributory infringement insofar as he or she quite clearly endorses the
linked content that is virtually an integral part of his or her own site through
the effect of the embedded link. These issues have already been debated in a
case brought before the Copyright Board of Canada.
The Tariff 22 case before the Copyright Board of Canada and the Supreme
Court of Canada In the Tariff 22 case, the Society of Composers, Authors
and Music Publishers of Canada (SOCAN) filed a proposed tariff for the
public performance of musical works through a telecommunications network
for approval by the Copyright Board as part of an administrative procedure
that is a feature of the Canadian copyright system. This tariff covers primarily
Internet transmissions of musical works. Following a period of consultation,
the board determined, in an initial decision of 27 October 1999, which activities on the Internet constitute acts that are subject to the payment of royalties.30
When considering acts of communication to the public, the board made an
interesting distinction between embedded links, which can be likened to acts
of communication to the public, and other types of links, which do not imply
any communication to the public:
The person that creates an embedded hyperlink to a work authorizes its communication. The person that merely supplies a link which must be activated by the user
does not.
.
In itself, the creation of hyperlinks does not involve a communication to the
public of any works contained at the linked sites. In their simplest form, hyperlinks
represent an electronic directory of addresses.
30
Public Performance of Musical Works, Copyright Board of Canada, 27
October 27, 1999, available at http://www.cb-cda.gc.ca/decisions/m27101999-b.pdf.
This case went up to the Supreme Court of Canada (Society of Composers, Authors and
Music Publishers of Canada v Canadian Assn. of Internet Providers, 2004 SCC 45,
[2004] 2 SCR 427).
84
Thus, some form of authorization is arguably involved in the case of embedded links, which results in the possibility of holding the provider of an automatic
link as indirectly liable for copyright infringement under Canadian law (and
under other laws based on the UK-originated concept of authorization).33
Infringements Involving the use of Pointers and Linking Techniques
Other copyright cases on linking combine the issues resulting from the use of
protected elements as pointers and those generated by the type of links. Direct
copyright liability is involved here, and the main issue is the application or
non-application of copyright exceptions, as shown in the US Kelly v Arriba
case where the scope of the fair use exemption is the core of the debate.
Kelly v Arriba34 In this case, the visual search engine Arriba (currently
available at www.ditto.com) enabled users to search for images on the Internet
on whatever words the user entered. The results of the search were presented
as reduced thumbnail pictures. These reduced photographs also served as
hyperlinks. By clicking on a thumbnail, the image (located on a third partys
web site) was extracted from the original site and presented to the user in a
new window, in its original size and with a few attributes, including the URL
address of the site from which it originated. This URL address also served as
a hyperlink to the page containing the image. Thus, the page of the site from
which the image originated was not presented to the user.35
31
Muzak Corp. v Composers, Authors and Publishers Assoc. (Canada), [1953]
2. SCR 182, at 189.
32
Public Performance of Musical Works, Copyright Board of Canada, 27
October 1999, at 27, 48. The distinction between automatic links and user-activated
links seems to be shared by the Supreme Court of Canada (see Society of Composers,
Authors and Music Publishers of Canada v Canadian Assn. of Internet Providers, 2004
SCC 45, [2004] 2 SCR 427 at 25).
33
See the contributions of G. Austin Chapter 5, A. Dixon Chapter 1, and J.
Ginsburg Chapter 4 in the present volume for further developments on the authorization approach for secondary copyright liability.
34
Kelly v Arriba Soft Corp., 77F. Supp. 2d 1116 (C.D. Cal. 1999).
35
In a later version of its search engine, Arriba made a change so that two
85
The plaintiff, a photographer with his own site who had at least 35
photographs indexed by Arriba, objected to Arribas use of his works on copyright grounds. It should be noted that Arriba did not dispute the allegation that
it reproduced and displayed the plaintiffs photographs. In its defence, Arriba
relied on the fair use exception.36 In his discussion, the judge found that
several factors weighed in favour of fair use. First, Arribas use of the
photographs was considered as transformative in nature, a factor identified
by the Supreme Court to define fair use in case of parody:37
Defendants use is very different from the use for which the images were originally
created. Plaintiffs photographs are artistic works used for illustrative purposes.
Defendants visual search engine is designed to catalog and improve access to
images on the Internet. The character of the thumbnail index is not esthetic, but
functional; its purpose is not to be artistic, but to be comprehensive.38
86
In the final balance of interests, the judge concluded that the various factors
referred to above weighed in favour of fair use. The judge stressed the decisive importance of search engines for the Internet in ultimately authorizing
Arribas use of the photographs:
The first and fourth factors (character of use and lack of market harm) weigh in
favor of a fair use finding because of the established importance of search engines
and the transformative nature of using reduced versions of images to organize and
provide access to them. Plaintiffs images were swept along with two million others
available on the Internet, as part of Defendants efforts to provide its users with a
better way to find images on the Internet. Defendants purposes were and are inherently transformative [].42
In 2002, the Ninth Circuit affirmed this decision in part and reversed it in
part.43 The Court held that the defendants actions in copying the photographs
to create the thumbnail images were not infringing because they were deemed
to be a fair use of the copyright works. The smaller, lower resolution thumbnail images were found to fulfil a different function from the plaintiffs original images. The copies were merely used to facilitate access to the images by
cataloguing them in response to search results. In addition, their reduced resolution would prevent them being used effectively for the same artistic purpose
as the originals, as any enlargement would result in a loss of the images clarity. The Court went further than the District Court, holding that the display of
the full-size version of the images when a thumbnail was clicked, however,
was held to be an infringement of the plaintiffs exclusive right to publicly
display the copyright work.44 It should be noted that the image displayed was
imported directly from the plaintiffs site and the defendant did not copy the
images. The Court held that this public display of the full-size images was not
a fair use because the defendants use of the images was not for a different
purpose than the plaintiffs use of them and the defendants use of the images
was likely to divert web users away from the plaintiffs site, thereby damaging the plaintiffs market for sales and licensing of the images.
In 2003, the same Court also affirmed the original finding that the defendants copying of the plaintiffs photographs to create and retrieve the thumbnail images was a non-infringing fair use.45 However, the Court avoided
resolving the issue of whether the embedded linking to and framing of the fullsize images hosted by third-party web sites was infringing. Instead, the
42
43
Id. at 1121.
Kelly v Arriba Soft Corporation 280 F 3d 934 (9th Cir, 2002), withdrawn 9th
Cir 3 July 2003.
44
Section 106 of the US Copyright Act.
45
Kelly v Arriba Soft Corp 336 F 3d 811 (9th Cir, 2003).
87
District Courts opinion on this point was reversed as it was held to have made
an ultra vires ruling.
The Courts finding that search engines reproduction of images for use as
thumbnails is fair use under the Copyright Act was upheld by the same Ninth
Circuit Appeal Court in the later Perfect 10 v Google case,46 a case that will
be further reviewed below under the indirect liability heading. The District
Court of California had originally ruled that the fair use defence did not apply
to Googles use of thumbnail images it created, as these thumbnail images
could be downloaded for use with a cell phone in direct competition with a
similar service provided by Perfect 10. On appeal, the decision to vacate the
District Courts original ruling relied heavily on the fact that there was no
evidence to support the use of Googles thumbnails for cell phone downloads.47
Other cases involving linking to photographs A German First Instance Court
also considered that offering links consisting of thumbnail reproductions of art
works does not trigger copyright liability when the creator of those works has
consented to their online reproduction.48 To reach this conclusion, however,
the decision relied on a completely different reasoning: the Court held that, by
making available the thumbnails, the defendant Google had violated the
communication to the public and the reproduction right belonging to the
creator; contrary to the decision in Kelly v Arriba, no exception was discussed
by the Court to exempt this use from copyright liability. Rather, the Court
considered that an implied consent to such use could be derived from the fact
the artist had first released the photographs on her web site. The works were
broadly available at no cost and her web site did not use any metadata (such
as robottxt), thus, indicating she consented to the use of thumbnails.
The issue of implied consent is regularly discussed in cases involving
search engines and Google in particular. In the Belgian case Copiepresse v
Google (see above), the argument was also made against the copies of the
press articles made on the Google cache pages. The press publishers in particular complained about the online availability of protected articles, through
cache copies, that were no longer available on the publishers web pages. By
indexing those pages and storing them as cache copies, Google was offering
free access to articles for which the readers should in principle pay. According
to the publishing model adopted, the articles are removed from the online web
46
47
Perfect 10, Inc. v Amazom.com, Inc., No. 06-55405 (9th Cir., 16 May 2007).
See infra for a discussion of the Courts ruling in relation to Googles liability for secondary infringement.
48
LG Erfurt, 15 March 2007 3 O 1108/05, MMR 2007 Heft 6 p. 393
(Thumbnails bei Google).
88
site a few days after their placement and are then only accessible subject to
payment. Googles practice was bypassing the business model used by those
publishers. In such a case, the argument that some form of implied consent
results from the fact no metadata is used by the publisher to prohibit the automatic indexing and the cache copies has some validity.
In addition to the infringement of copyright subsiding in a photographic
image, the provision of links to photographs can fall foul of privacy rights. The
defence of implied consent was also applied by the District Court for the
District of South Carolina when considering the infringement of privacy rights
in the context of a hyperlink to a photograph on a publicly accessible web site.
In October 2007, the Court held:
a person who places a photograph on the Internet precisely intends to forsake and
renounce all privacy rights to such imagery, particularly under
circumstanceswhere [the subject] did not employ protective measures or devices
that would have controlled access to the Web page or the photograph itself.49
89
50
90
52
(Swed.).
53
54
55
91
58
KODA, NCB, Dansk Artist Forbund, Dansk Musiker Forbund & IFPI
Denmark, Case Nos. V.L. B-1943-99 and V.L. B-2089-99 (High Ct. of Justice, Western
Div., 20 April 2001).
92
Although the judge does not actually use the terms contributory infringement
or complicity, he applies the theory of the link providers complicity to unlawful acts of reproduction committed by Internet users. As confirmed on appeal,
the conduct of the link provider is (probably) not compatible with the obligation
of due care that can be deduced from the general principles of civil law. The
Court of Appeal held that the balance of interest (in summary proceedings)
weighs in favour of granting a provisional injunction against the link provider.
TONO v Bruvik62 In 2005, the Norwegian Supreme Court established
secondary liability for the act of creating links to copyrighted MP3 files. This
59
60
93
63
64
65
94
95
On appeal, the Court considered the factors listed at subs. 101(1A) of the
Australian Copyright Act 1968. In relation to the first factor, the power to
prevent, the Courts decision was based on the fact that Mr Cooper deliberately designed the web site to facilitate infringing downloading of sound
recordings.70 It was held that he could not rely on his indifference to the use
of his web site to support his inability to prevent the infringement. Coopers
financial benefit from the advertising and sponsorship on his web site led the
Court to assume a commercial relationship between Cooper and the users of
his web site. Cooper included on his web site disclaimers, which misstated
67
See also the contributions of A. Dixon Chapter 1, J. Ginsburg Chapter 4 and
M. Schlesinger Chapter 2 in the present volume.
68
A trading name of E-talk Communications.
69
Subsection 101(1A) of the Australian Copyright Act 1968, introduced by a
2000 Amendment.
70
Universal Music Australia Pty. Ltd. v Cooper, [2006] FCAFC 187 (Fed. Ct.
Full Court Appeal, 18 Dec. 2006) at 149.
96
Australian copyright law. The Court did not find that Cooper took reasonable
steps to prevent infringement. In fact, the intended purpose of the disclaimers
was interpreted as purely cosmetic.
The Internet Service Provider E-Talk and its Director were also found liable
for copyright infringement. E-Talks actions were found to have gone beyond
simply providing facilities for making, or facilitating the making of, a
communication71 because it was aware of the copyright infringements, it
hosted Coopers web site (MP3s4free.net) for free in return for advertising on
the site, and it had the power to prevent the infringing conduct by taking down
the web site itself or declining to provide its host facilities. Conversely, the
Appeal Court overturned the original decision in relation to the E-Talk
employee. In his capacity of employee, he did not possess the power to, nor
could he have taken reasonable steps to, prevent copyright infringement, and
he had no relationship with the users of Coopers web site.
Cooper sought to rely on the Perfect 10 case (see below) and placed considerable weight on a suggested analogy between his web site and Googles
general search facility. It should be noted that this analogy was rejected by the
Court, and it clearly differentiated Coopers site from a general search engine,
stating Google is a general purpose search engine rather than a web site
designed to facilitate the downloading of music files.72
Baidu and Yahoo China cases The Chinese Courts have used the concept of
assisting infringement to establish the secondary liability of search engines
providing links to copyrighted materials. The Beijing No 1 and the Beijing No
2 Intermediate Peoples Courts simultaneously reached opposing decisions
regarding the liability of search engines for copyright infringement on providing links to infringing music files.73
Chinas most popular search engine, Baidu,74 was accused by several
record companies, including EMI, SonyBMG, Universal and Warner, of copyright infringement through its automated MP3 search engine.75 The companies
claimed that by providing links to music files, Baidu infringed their communication right under Chinese law. At issue in this case was whether Baidu had
communicated MP3 songs to the public by allowing users to search and down-
71
72
97
load illegal MP3 files through the Baidu MP3 search engine service. Baidu did
not directly upload MP3 files to their servers; they merely provided links to
MP3 files stored on other servers.
Beijing No. 1 Intermediate Peoples Court held that, as the relevant MP3
files originated from other web servers and not the Baidu web site, the
communication occurs between the users downloading the MP3 files and the
web site that uploads the files.76 The Court ruled that a web site providing
links was not directly liable as it did not engage in the act of communication
via the Internet under the Copyright Law of the Peoples Republic of China.77
However, the Court confirmed that Baidu could be indirectly liable for participating in and assisting third-party sites in transmitting infringing music.78
The Baidu case was considered under an old law that is no longer in force,
and therefore, this judgement can be considered as having been superseded by
the Yahoo! China ruling.
The Beijing No. 2 Intermediate Peoples Court rejected Yahoo! Chinas79
appeal against a decision holding it to be liable for assisting infringement for
linking to web sites offering illicit content.80 The Court ruled that the provider
of a searching or linking service is not liable for infringement where links to
infringing material are disabled following receipt of notice from the rights
owner. The Court clarified that a web site would not be liable where copyright
owners had not sent adequate notices of infringements, however, it would be
jointly liable for infringement if it is aware of or ought to know that the linked
work, performance or phonogram product constitutes an infringement and
fails to remove the link.81
Linking to File-sharing Programs
Phonefile v Startsiden82
76
See Wang Qian, A Direct Decision vs an Indirect Problem: A Commentary
on Seven Record Labels vs Baidu.com (2007) 1 Journal of China Copyright.
77
This decision has been superseded by contemporaneous decision of the
Beijing No. 2 Intermediary Court infra.
78
Baidu was not held to be liable because the IFPI had brought the case against
Baidu under outdated Chinese copyright law.
79
Owned by Alibaba.
80
Go East Entertainment Co. Ltd. v Beijing Alibaba Information and
Technology Co. Ltd., Civ. No. (2007) 02627 Er Zhong Min Chu Zi (Beijing No. 2
Intermediate Peoples Court, 24 April 2007).
81
Article China Court Rejects Yahoo Chinas Deep Linking Appeal,
December 20, 2007, By Steve McClure, Tokyo, http://www.billboard.biz/
bbbiz/content_display/industry/e3i3ed206b8d3c0733b23120a461b4581f2.
82
Phonefile v Startsiden (Oslo District court, Norway, 28 October 2003).
98
already discussed. The Court was asked to decide whether the Internet Portal
ABC Startsiden83 should be held liable for creating hyperlinks to file-sharing
programs, such as Kazaa.84 The defendant in this case provided links to filesharing programs, which could be used to facilitate copyright infringement as
well as other, lawful purposes, rather than directly to infringing materials.
Extending the distance of the linker and the infringement, in terms of the chain
of events, makes it more difficult to establish liability on the part of the linker.
ABC Startsiden essentially acts like a directory by categorizing different types
of services. The MP3 category presented links to file-sharing services. The
Court considered ABC Startsidens potential indirect liability for providing
hyperlinks to web sites where programs allowing users to produce illegal
copies of protected works can be downloaded. Relying on the principles of
secondary liability, the discussion in the case focused on whether there was
sufficient causation to make the defendant an accessory to the copyright
infringements committed by end-users. Although the Court found the existence of a causal link between the links created by the defendant and the
infringements committed by the end-users, this causal link was not sufficient
to comply with the Norwegian legal theories on liability. As the user would be
obliged to take steps subsequent to accessing the home page of the file-sharing service, the links were held to be of little importance in the chain of causation and no causal link was established. The Court noted that the file-sharing
programs would still be available if ABC Startsiden were to remove its hyperlinks and that such programs can also be used for non infringing purposes.85
Hosting of Links to Illicit Content
Scientology v XS4al1 In the Dutch case Scientology v XS4al1, the issue of
hosting was addressed as well as linking. The Church of Scientology objected
to its copyrighted writings (certain texts of Ron Hubbard, the founder of the
Church of Scientology) being disseminated on the Internet and sued 22 hosting service providers (including XS4all and Dataweb), in addition to the operator of the site at issue, Mrs. Karin Spaink, who was primarily responsible for
the online posting. As well as seeking an order enjoining the defendants from
hosting its copyright material, the Church also asked the Court (as a preventive measure) to prohibit them from linking to other sites containing the copyrighted texts.
83
84
85
http://www.startsiden.no
http://www.Kazaa.com
See Article Decision on Linking to File Sharing Services, Jon Bing,
Norwegian Research Centre for Computers & Law, Faculty of Law, University of Oslo,
http://merlin.obs.coe.int/iris/2004/2/article33.en.html.
99
At first instance, the Court of The Hague ordered the defendants to desist
from hosting or establishing links to the Churchs texts, holding that the defendants were liable to the extent that they knew about the presence of the texts
or of links on their servers, that the correct nature of the Churchs notification
could not reasonably be doubted, and that they did not act expeditiously to
remove the texts or links in question.86 The Courts reasoning concerning the
liability of the defendants, including the provider of the link and the ISPs hosting the page with the link, was based on the general obligation of due care
(zorvuldigheid) contained in the Dutch Civil Code.
On appeal, the Court of The Hague rightly considered that the freedom of
expression protected by Art. 10 of the ECHR (see above) would be disproportionately restricted by such an injunction and thus reversed the first instance
decision.87 This is clearly a case where copyright is (mis)used in order to
unduly limit the freedom to disseminate opinions that are particularly important to bring to the attention of the public. At length, the Court of Appeals
decision retraces the attempts of the Church of Scientology to restrict the
public debate on the legitimacy of the Church and concludes that the claim
against the publication of such protected documents, including through links,
would not be a measure necessary in a democratic society to protect the
right of others, in this case the copyright held by the Church.88
IFPI v Skynet A further case involving IFPI had to do exclusively with the
question of hosting hyperlinks.89 The Belgian branch of IFPI issued a claim
against a Belgian access provider, Skynet, for the presence of hyperlinks on
some of its customers sites leading to MP3 files that IFPI claimed were
infringing. IFPI had not notified the operators of the sites containing the
allegedly illegal MP3 files, nor their hosts, nor Skynets customers who had
established the links to the sites, but had directly addressed its requests to
86
Church of Spiritual Technology/Dataweb B.V., Rb. The Hague, 9 June 1999,
available in Dutch at http://www.xs4all.nl/~kspaink/cos/verd2ned.html. See also
Computerrecht, 1999/4, p. 200, note P.B., Hugenholtz; B.I.E., 1999, p. 458, note A.
Quaedvlieg.
87
Court of Appeal, The Hague, 4 September 2003, A&M, 2004.1, pp. 44. On
this decision, see G. Gathem and A. Strowel, Droit dauteur versus libert dexpression
et responsabilit des fournisseurs de service sur lInternet, A&M, 2004.1, pp. 5052.
88
On the balance of copyright and freedom of expression, see A. Strowel and F.
Tulkens, Freedom of Expression and Copyright under Civil Law: Of Balance,
Adaptation and Access, Copyright and Free Speech, J. Griffiths and U. Suthersanen
(ed), Oxford University Press, 2005, pp. 287313; A. Strowel and Fr Tulkens, Droit
dauteur et libert dexpression. Regards francophones, dEurope et dailleurs,
Larcier, 2006, p.161.
89
See also the discussion on Universal Music Pty. Ltd. v Cooper infra.
100
Skynet. Skynet, upon being asked to withdraw the links, had removed all of
them from its servers, though not within time limits satisfactory to IFPI, who
thus sought injunctive relief from the Court.
In his decision of 2 November 1999, the president of the Brussels Court of
Commerce concluded that the hosting of links leading to copyrighted materials could trigger Skynets liability if there were no reasonable grounds to
doubt the correctness of IFPIs notification.90 The president decided that there
were no such grounds in this case, and thus enjoined Skynet from knowingly
storing information on its server, giving rise to unlawful distribution of musical recordings.91
The Brussels Court of Appeal adopted the opposite solution. In its ruling of
13 February 2001, the Court first addressed the issue of the liability of the link
provider and stated quite clearly that links to MP3 files:
[] are a kind of key which, by clicking on it, allows reproductions of musical
recordings made without the rightful parties consent to be downloaded, copied and
distributed. The creation of links to such unlawful files, when one knows or should
know that they are illegal, constitutes an unlawful act.92
As regards the liability of the ISP, the Court of Appeal duly informed about
the relevant provisions of the US Digital Millennium Copyright Act and other
existing foreign law and case law, and of the EC 2001/31 Electronic
Commerce Directive decided to first develop its own standards for a notice
and take down procedure, and then to verify the application of such standards
to the facts of the case, in order to decide whether Skynet had acted contrary
to fair trade practices.
The notice and take-down procedure developed by the Court of Appeal
implies that when IFPI informs Skynet of the existence of hyperlinks on sites
that refer to illegal musical recordings posted on other sites, Skynet should
remove these links or prevent access to them, provided the following conditions are met and the procedure indicated below is followed:
IFPI must first, via an e-mail to the address indicated by Skynet, inform
Skynet of these links, identify them by stating the page(s) on the site of
Skynets customer on which these links appear along with the musical
recordings that form part of IFPIs repertoire and can be downloaded
from the linked sites, and must expressly require that these links be
removed or made inaccessible;
90
91
92
101
93
Perfect 10 Inc. v Amazon.com Inc, 508 F.3d 1146 (9th Cir. 2007). Because
Google was a named defendant in this important case, and Googles service was more
extensively discussed by the Court than Amazon.coms, we will refer to this case as
Perfect 10 v Google.
102
Arriba). It then focused on secondary liability regarding Googles inline linking to full size image.
To best understand how the courts addressed this issue, some background
on the technology is necessary.
Googles thumbnail images serve as a link for the user to obtain more information about the image. Clicking on a thumbnail image opens a new page that
uses the framing method to display two separate windows on the users screen,
one containing information from the Google web page, including the thumbnail image and text, and the other incorporating the full-size image from the
third-party web site through the technique called inline. Google does not
store the (sometimes illicit) full-size images appearing in one window on the
users screen but only provides HTML instructions directing a users browser
to access a third-party web site. Because providing these HTML instructions
is not equivalent to showing a copy, the Ninth Circuit held that Google cannot
be directly liable for the appearance of the full-size images.
The Court considered both vicarious and contributory infringement based
on the direct liability of the third-party web sites displaying the full-size
images, not of the Google image search users.
In order to find Google vicariously liable, the test defined by the Grokster
decision of the Supreme Court must be applied: one infringes vicariously by
profiting from direct infringement while declining to exercise a right to stop
or limit it.94 This means it would be necessary to establish that Google
enjoyed a direct financial benefit from the infringing activities of third-party
web sites that host and serve infringing copies of Perfect 10 photographs,
and that Google declined to exercise the right and ability to supervise or
control the infringing activity. According to the District Court and the Ninth
Circuit, Google is not deemed to have sufficient control over or authority to
stop or limit the infringing conduct of third parties to satisfy the second
necessary prong of the test for vicarious liability. Thus, Perfect 10 was
deemed unlikely to succeed in proving that Google can be held vicariously
liable.
In order to establish contributory infringement, Google had to know the
infringing activity and induce, cause or materially contribute to that activity.
To ascertain Googles knowledge of the infringing activities, the District Court
had considered the copyright notices placed on the original images, Googles
monitoring activities and the notices of infringement that were sent from
Perfect 10 to Google; however, it held that, alone, the inclusion of a copyright
notice on the image is not sufficient for Google to ascertain whether the
images were subject to copyright, and thus, Googles established monitoring
94
103
activities were not deemed to confer knowledge on it. The District Court did
not reach a decision as to whether the notices of infringement sent from
Perfect 10 to Google were sufficient to establish knowledge.
Assuming Google had knowledge of infringing materials available on its
system, the District Court, when discussing material contribution, relied on the
fact that Google does not offer the facility for its users to download the images
in the same way that Napster enabled its users to download music files.95
Focusing on the indirect liability in relation to the web sites offering the fullsize images to which Googles system links (not in relation to the users of
Googles system), the Court of Appeal dismissed the opinion of the District
Court that had concluded that Google did not materially contribute to infringing conduct because it did not undertake any substantial promotional or advertising efforts to encourage visits to the infringing web sites. For the Court of
Appeal, such analysis is not correct as Google substantially assists web sites
in distributing their infringing copies to a worldwide market. While the Court
of Appeal held that Googles activities do not meet the Grokster inducement
test96 because it has not promoted the use of its search engine specifically to
infringe copyrights, the Court did state that contributory liability could still be
imposed under common law principles, which establish that intent can be
imputed: an actor may be contributorily liable for intentionally encouraging
direct infringement if the actor knowingly takes steps that are substantially
certain to result in such direct infringement.97
For Google to be held contributorily liable, it must be established that
Google had knowledge that infringing Perfect 10 images were available using
its search engine, that it could take simple measures to prevent further damage
to Perfect 10s works and failed to do so. Because the District Court did not
resolve the factual issues over the adequacy of the Perfect 10s notices and the
availability of reasonable and feasible means for Google to refrain from
providing access to the infringing images, the Court of Appeal remanded this
claim back to it. Thus, there is no definite ruling in Perfect 10 v Google on
whether Google is in fact contributorily liable for inline linking to full-size
infringing images. The Court of Appeal rightly emphasizes that secondary
liability in such a linking case requires fact-intensive enquiries.
As for other issues considered in the present chapter, a case similar to
Perfect 10 has found its way in continental Europe, allowing a comparison of
views held in very different jurisdictions. A collective society (SAIF) representing well-known French photographers (Doisneau, Cartier-Bresson, etc.)
95
96
97
at 54.
Perfect 10 v Google Inc, 416 F Supp 2d 828 (CD Cal, 2006) at 855.
See contribution of J. Ginsburg Chapter 4 in the current volume.
Perfect 10, Inc. v Amazom.com, Inc., No. 06-55405 (9th Cir., 16 May 2007)
104
filed a case against Google France and Google Inc. for offering, through
Google Image Search, links to illicit reproductions of those authors pictures.
On 20 May 2008, the Paris First Instance Court quite surprisingly ruled that
US law should apply because Googles servers are located in California where
the allegedly infringing acts also take place. The French court only focused on
the alleged direct infringement for reproducing thumbnails on Googles pages.
Applying the US fair use provision, the court considered that Googles use was
non-commercial and did not negatively affect the exploitation of the
photographs, and was thus deemed fair.98 Strangely, the issue of indirect copyright liability for linking to illicit content was not addressed by the Paris court.
Links to Circumventing Devices
The DeCSS cases As the Internet is a global and extremely rapid means of
communication, it is very difficult to prevent the disclosure and subsequent
dissemination of information on the network. The DVD Copy Control
Association Inc. and the American film industry attempted to stop the online
communication of information concerning the possibility of decrypting a
program that is used to protect copyrighted films. Before marketing their films
on DVDs, the major US film producers took steps to ensure that they could not
be copied. The Content Scrambling System (CSS) program was developed
to prevent copying of films on DVDs. For obvious reasons of controlling the
use of this technology, film producers gave a single company (the DVD Copy
Control Association, Inc.) the right to license its corresponding decryption
technology. No CSS license had been granted to enable DVDs to be played on
Linux operating systems. However, a Norwegian Linux user, Jon Johansen,
succeeded in reverse engineering the CSS code and created a program called
DeCSS, enabling users to circumvent the CSS encryption system and thus
copy DVDs. In record time, the DeCSS was disclosed on a profusion of web
sites with an equally impressive number of web sites linking to them. In turn,
the US film industry brought a number of lawsuits against operators of sites
containing the DeCSS.
In one of these suits, DVD Copy Control Assn v McLaughlin, the film
producers requested an injunction prohibiting the defendant not only from
disclosing the DeCSS on his own site, but also from linking to sites containing the DeCSS. In its order granting a preliminary injunction, a California trial
court ordered the defendant to remove the DeCSS from his site but did not
98
SAIF v Google France and Google Inc., TGI Paris, 20 May 2008, accessible
on www.legalis.net.
105
deprive him of his freedom to establish links, claiming that such an injunction
against linking would be overbroad and burdensome.99 The court added:
Links to other web sites are the mainstay of the Internet and indispensable to its
convenient access to the vast world of information. A web site owner simply cannot
be held responsible for all the content of the sites to which it provides links. Further,
an order prohibiting linking to web sites with prohibited information is not necessary since the Court has enjoined the posting of the information in first instance.100
In our view, the last consideration is mistaken: as long as the DeCSS continues to be available on the Internet, whether on the defendants site or on other
linked sites, it will be in the plaintiffs interest to apply for an injunction
against linking. The real issue is rather the legal basis on which the plaintiff
can seek an injunction against linking. Under US law, the Digital Millennium
Copyright Act offers such a basis, as will be examined in the following case.
In the case on the merits, Universal City Studios v Reimerdes, the film
industry sought a permanent injunction against the defendants posting of the
DeCSS on their web sites and against the linking to other web sites containing
the DeCSS.101 The discussion regarding posting of the DeCSS (which was
declared to violate the DMCA) will not be further addressed here. More interestingly for this contribution, the court concluded that by linking to other web
sites containing DeCSS, the defendants unlawfully offered, provided, or
otherwise trafficked in the described technology, and thus equally violated the
DMCA.102
As regards the First Amendment defence, the court recognized the possible
chilling effect to the freedom of expression of a rule permitting liability for,
or injunction against, hyperlinks (especially where the linked site would also
offer content other than the DeCSS), and therefore, defined the standards to be
applied in deciding whether the linking at stake should be declared illegal. The
standards developed by the court are as follows:
[T]here may be no injunction against, nor liability for, linking to a site containing
circumvention technology, the offering of which is unlawful under the DMCA,
99
DVD Copy Control Assn v McLaughlin, No. CV 786804, 2000 WL 48512
(Cal. Super. Ct. 21 January 2000).
100
Id. at *4.
101
At first, the plaintiffs obtained, on 20 January 2000, a preliminary injunction,
but only as regards the posting by defendants of DeCSS on their web sites (not for linking). Universal Studios, Inc. v Reimerdes, 82 F. Supp. 2d 211 (S.D.N.Y. 2000).
Subsequent motions to expand the preliminary injunction to linking and to vacate it
were consolidated with the trial on the merits.
102
Universal City Studios, Inc. v Reimerdes, 111 F Supp. 2d 294, 325 (S.D.N.Y.
2000).
106
absent clear and convincing evidence that those responsible for the link (a) know at
the relevant time that the offending material is on the linked-to site, (b) know that
it is circumvention technology that may not lawfully be offered, and (c) create or
maintain the link for the purpose of disseminating that technology.103
Knowledge of the infringing material on the linked-to site and the intentional
placement of the link to disseminate the infringing material were therefore
sufficient to conclude that the provider of the link was liable. In Universal City
Studios v Reimerdes, the defendants had, upon issuance of the preliminary
injunction enjoining them not to post the DeCSS on their web site, entered into
a state of what they had themselves termed electronic civil disobedience by
attempting to defeat the preliminary injunction by linking users to other web
sites still offering the DeCSS, and by encouraging other sites that had not been
enjoined from posting the DeCSS to offer the DeCSS on their web sites. Based
on such eloquent evidence of the defendants intention, the court concluded
that the abovementioned conditions for issuing a linking injunction were met.
The same outcome for linking to an anti-circumvention device has been
reached in Germany (see below), although the legal grounds completely differ.
BMG Records v Heise Zeitschriften Verlag In this German case, which
echoes the above DeCSS cases in the US, a respected online news service
specialized in information technology had reported on a software (AnyDVD)
advertised for download from a third partys web site. The software was
hosted on a server based in Antigua and was able to circumvent the encoding
tools used to protect sound and video recording. Various German producers of
recordings sued the online news service because its report contained a link to
the web page from which the circumventing software could be downloaded.
From reading the linked-to page, it was also clear that this software whose
ability to crack anti-copying devices used for DVDs was praised was also
prohibited in European countries. At the time this online report was made (in
January 2005), Germanys 1965 Copyright Act had already implemented the
European rules prohibiting the trafficking of circumventing devices, including
promotion and advertisement to prevent such devices (Art. 6 of the EC
2001/29 Copyright in the Information Society Directive). At first instance and
later on appeal, the Munich Courts held that the defendant was liable for
assisting the infringement resulting from the traffic of circumventing technology.104 The form of contributory infringement applied by the Appellate Court
is known as disturbance liability (Strerhaftung). It relies on a provision of
103
104
Id. at 341.
OLG Mnchen, 29 U 2887/05, 28 July 2005 (21 O 3220/05 Landgericht
Mnchen I).
107
the German Civil Code (Article 830) dealing with torts, in particular acts of
contributory tortfeasors. On this basis, liability exists where an act, even in the
absence of intention or negligence, results in the violation of a legally
conferred benefit. In such a case, only an injunction can be granted, not
damages.105 The plaintiffs obtained an injunction against the online service for
assisting copyright infringement through the online publication and link.
As in other cases involving linking, the endorsement of the illicit content
referred to is decisive in establishing liability. In various decisions, the
German Supreme Federal Court (Bundesgerichshof) has emphasized that
hyperlinking is not subject to specific rules for online liability (such as the
German rules of the Telemedien law implementing the provisions of the EC
2000/31 Electronic Commerce Directive on intermediaries), but to the general
rules on liability. Applying these rules in two cases106 involving linking to
illicit material (such as pornographic content), the Supreme Federal Court
ruled that the person who, through linking to the information provided by third
parties, makes this information his own is liable in the same way the provider
of this information is. This appropriation (endorsement or sponsoring) of
third-party content exists when the link provider consciously and intentionally
subscribes to the linked-to content.
SUMMARY
Secondary liability for copyright infringement has been widely debated in
relation to P2P file sharing. It also plays an important role with regard to
hyperlinking. In general, to link does not raise any copyright liability.
However, in certain circumstances, the links between web pages may prove
dangerous. Caution is necessary if good relations are to be maintained.
Hence the motto some commentators have proposed: Think before you link.
The level of cautiousness needed and the liability risk firstly depend on the
type of linking:
Use of protected pointers. It is certainly necessary to think first before
linking if, instead of an Internet address, the pointer takes the form of an
image or other feature that may enjoy copyright protection in its own
right. The use of headlines as pointers has in particular been condemned
105
See G. Westkamp (2006), Hyperlinks, circumvention technology and
contributory infringement a precarious tale from German jurisprudence, JIPLP, Vol.
1, p. 309.
106
BGH 1 April 2004 I ZR 317/01 (Schner Wetten) and BGH 18 October
2007 1 ZR 102/05.
108
107
109
who offer a general purpose service and might legitimately ignore the presence
of illicit content. However, even for hosting providers, who at first sight play
a role remote from the directly infringing acts (the illicit uploading), some
direct knowledge might result from adequate notifications, and this triggers an
obligation to react expeditiously as in other cases involving the hosting of
illicit content.
The review of the case law on those aspects has demonstrated the multiple
issues raised by hyperlinking but a certain convergence as well in the way
courts have tackled those issues although they are operating in very different legal contexts and with the help of various legal tools often deeply rooted
in common law.
1
2
111
112
control of the facilitator so that it no longer knows in fact what customers are
up to, contributory infringement may be more difficult to establish. That, in
essence, was the copyright owners problem in the Betamax case.10 Sony, the
distributor of the video tape recorder, could well anticipate that consumers
would use the record function to copy protected programs, but once the device
was out of the manufacturers hands, it could neither know precisely what the
end-users were doing, nor limit their use to permissible copying.
In absolving Sony of liability, the US Supreme Court added a gloss to the
prior standard: one who distributes an infringement-enabling device will not
be liable for the ensuing infringements if the device is widely used for noninfringing purposes. Indeed it need merely be capable of substantial noninfringing use.11 This is so even though the distributor was aware that at least
some of the use to which the device would be put would be infringing. The
court then held that time shifting (recording for subsequent viewing and then
erasure) of free broadcast television programs was a fair use.12 On the record
in the case, the primary use of the VTR was for time shifting.13 A use held to
be non-infringing thus predominated, and certainly met the substantial standard.
Cases subsequent to Sony endeavoured to apply the substantial noninfringing use standard. But the standard did not again come into play with
respect to mass-market means of copying until the Napster controversy.14
There, an online peer-to-peer music sharing service maintained a central
database that allowed end-users to find other users currently online and to
copy MP3 files from their hard drives. Napster evoked the Sony standard,
asserting that not all the files were copied without authorization. Napster also
asserted that P2P architecture could, in the future, spawn more non-infringing
uses. The Ninth Circuit agreed that Sony required taking into account the
services capacity for future lawful use, but nonetheless held Napster a
contributory infringer. In yet another gloss on the standard of liability, the
Napster court held that courts should inquire into non-infringing uses when
the distributor of the device lacks actual knowledge of and control over
specific infringements. Where, however, it is possible to segregate and prevent
10
11
12
13
14
113
8.1.2.
16
See, e.g., Fred Von Lohmann (2001), IAAL: Peer-to-Peer File Sharing and
Copyright Law after Napster available at http://www.gtamarketing.com/P2Panalyst/
VonLohmann-article.html.
17
MGM Studios, Inc. v Grokster Ltd., 380 F.3d 1154, 1165-66 (9th Cir. 2004),
revd., 125 S. Ct. 2764 (2005).
18
380 F.3d at 1162 n. 10.
114
principles. In this light, Sony was a case articulating a standard for assessing
liability when it cannot be shown that the device distributor sought to foster
infringement. But if the defendant has actively induced infringement, there is
no need to revisit the Sony standard in order to clarify what substantial noninfringing use actually means.
The Court set out three elements probative of intent to induce infringement:
(1) the defendant promoted the infringement-enabling virtues of its device; (2)
the defendant failed to filter out infringing uses; (3) the defendants business
plan depended on a high volume of infringement. In Groksters case, all three
elements were easily demonstrated. Grokster had sent out emails extolling P2P
copying, and it had aim[ed] to satisfy a known source of demand for copyright infringement, the market comprising former Napster users.19 Grokster
not only declined to devise its own filters; it blocked third-party filters. And
Groksters business plan depended on advertising, whose rates would turn on
the volume of users encountering the ads. The more Grokster could attract
visitors, the better for its business, and the prospect of free music attracts more
visitors than paid music. Taken together, these factors demonstrated a clear
intention to foster infringement. As the Court declared: The unlawful objective is unmistakable.20
Of course, inducement to infringe is actionable only if infringements in fact
occur. Because the liability derives from primary infringing conduct, bad
intent must join with unlawful end-user acts. Thus, for example, distributing a
copying device together with an exhortation to use the device to engage in
massive unauthorized copying does not give rise to liability if no one in fact
so uses it. In Grokster, however, end-user infringement was never in doubt;
plaintiffs studies showed that 90 per cent of the works copied were copyrighted,21 and even the Ninth Circuit acknowledged that the Copyright
Owners assert, without serious contest by the Software Distributors, that the
vast majority of the files are exchanged illegally in violation of copyright
law.22 The Supreme Court thus could exclaim: The probable scope of copyright infringement is staggering.23
Having ruled that bad intent, if proved, sufficed to find liability for
infringements thus induced, the full Court declined to analyse what the standard for contributory infringement would be when intent to foster infringe-
19
125 S.Ct. at 2781. See also Sverker Hgberg (2006), The Search for IntentBased Doctrines of Secondary Liability in Copyright Law, 106 Colum. L. Rev 909
(discussing the post-Grokster dangers of targeting a risky demographic).
20
125 S.Ct. at 2782.
21
Id. at 2772, 2778.
22
380 F.3d at 1160.
23
125 S.Ct. at 2772.
115
ment cannot be shown. The full court opinion provided some indication of that
standard, however, when it stressed that certain of the three indicia of intent
could not, in isolation, establish inducement because basing liability solely on
the defendants business plan, or solely on the design of its product, would be
inconsistent with Sony.24 But the Court assiduously declined to offer further
guidance on the meaning of substantial non-infringing use.
Two concurring opinions, each signed by three justices, ventured onto that
terrain, advancing opposing analyses. For Justice Ginsburg, Sony requires that
copyright protection be effective not merely symbolic.25 Where the overwhelming use of the device is to infringe, to reject the distributors liability
would reduce copyright protection to the merely symbolic. The three justices
also stressed factual differences between the facts of Sony and the activities of
Grokster and Streamcast. In Sony, the time shifting that the Court deemed
fair use was in fact the primary use of the video tape recorder at the time. By
contrast, the copies the Grokster and Streamcast users made were not ruled fair
uses, and the defendants made no showing of significant actual non-infringing
uses. The concurring opinion chided the Ninth Circuit for its failure to distinguish between uses of Groksters and StreamCasts software products (which
this case is about) and uses of peer-to-peer technology generally (which this
case is not about).26 The evidence of non-infringing use presented by the
defendants, and credited by the Ninth Circuit, addressed the general benefits
of P2P, and not the particular application of P2P by Grokster and Streamcast.
Failure to distinguish between peer-to-peer in general and the exploitation
made of that technology by Grokster and Streamcast characterizes the other
concurring opinion by Justice Breyer, signed as well by Justices Stevens and
OConnor, who had authored or signed the majority opinion in Sony. This
opinion urged a broad interpretation of Sony, in order to provide security to
technology entrepreneurs against attacks by copyright owners allegedly
harmed by the distribution of devices that enable end-users to make unauthorised uses of works of authorship. For these justices, the phrase capable of
substantial non-infringing use must be understood to excuse the distributor of
a device whose lawful use is as low as 10 per cent, especially if non-infringing uses might develop in the future. Moreover, this concurrence stressed, the
potential for non-infringing use should be assessed with respect to devices of
this type, and not specifically in relation to the defendants device. Justice
Breyer thus could assert that it did not matter that Grokster may not want to
develop these other non-infringing uses. But Sonys standard seeks to protect,
24
25
116
not the Groksters of this world (which in any event may well be liable under
todays holding), but the development of technology more generally.27
Justice Breyer emphasized the benefits of the Sony doctrine (as understood
by the three concurring Justices): it is strongly technology protecting; it is
forward looking; and it does not require judges to evaluate the technology at
issue.28 The opinion does not hide its bias in favour of technological development. In weighing the disadvantages inflicted on technology against the
advantages to authors and copyright owners that would flow from a stricter
interpretation of Sony (such as that pressed by the Ginsburg concurrence),
Justice Breyers opinion does not allude to the interests of creativity, but to
greater revenue security for copyright holders.29 In this perspective, the only
creators who count appear to be the technology innovators, here confronted
with the anonymous and oppressive financial interests of the copyright holders. The opinion adds insult to injury by declaring that, in any event, the law
disfavors equating the two different kinds of gain (copyright) and loss (technology); rather, it leans in favor of protecting technology.30 This striking
affirmation is based neither on the text of 1976 Copyright Act nor in the
Constitution. Its principal foundation is the Sony decision, which, as we have
seen, can be understood in several different ways.31
But perhaps the disagreement over the Sony standard will not in fact matter
very much because the Grokster inducement standard may displace inquiries
into the substantiality of non-infringing uses. Speculation is hazardous, but
one might predict that, where a device facilitates infringement on a massive
scale, its distributor will likely be found to have intended that result. Where
the infringement the device enables is relatively modest in scale, inducement
will not be found; however, neither will the Sony threshold for liability be held
to have been crossed, whatever its height. In other words, inducement and
27
28
29
30
31
117
Although one of the three Grokster elements is missing, this still seems like a
straightforward case of inducement, and, assuming the device is used as
intended, liability would be found.
Case 2. The distributor, culture-for-me.com, neither promotes infringement, nor
filters infringements out; its business plan requires a high volume of traffic to the
site. Bloggers on the unaffiliated culture-wants-to-be-free.com site identify and
promote the infringement-facilitating features of culture-for-me.coms device or
service.
118
119
they enable. What barnyard characterization fits those whose business plans,
albeit copyright-parasitic, contemplate mixing infringing and non-infringing
sources of revenue? If we take Groksters treatment of the role of intent literally, then the partial foundation of the business plan (and the concomitant
device design) on non-infringing uses should not matter; the entrepreneur still
intends to foster some infringement. Liability, however, may turn on how
much infringement. For we have posited that Grokster will supply the rule
when the actual or potential volume of infringement is staggering. Short of
that (but how much short of that remains uncertain), the Sony standard reappears, with (as we have posited) the result that the challenged technology will
be deemed lawful.35
If this prediction is incorrect, then we can expect further development of
the Sony standard for exculpatory non-infringing use; in the absence of intent
to induce infringement, will even trivial non-infringing use suffice to insulate
the technology entrepreneur so long as the technology in the abstract is capable of future non-infringing use? Or will any device or service primarily used
to infringe run afoul of the standard? Perhaps a glance at the analysis in a
related jurisdiction might clarify the liability of infringement facilitators. The
decision of the Federal Court of Australia in Universal v Sharman addressed
the liability of the Kazaa network for authorizing infringement, in violation
of the Australian Copyright Act.
35
If the sheep are to be divided from the goats based on volume of infringement,
this poses challenges for the timing of any lawsuit. If suit is brought too soon, the
record on actual use may not be sufficiently established. But if copyright owners wait
to see how the device or service is used in fact, it may become difficult to dislodge;
fair use may reduce to a synonym for fait accompli.
36
Vereniging Buma, Stichting Stemra v Kazaa BV, Supreme Court of the
Netherlands (Hoge Raad), decision of 19 December 2003, AN7253 Case no.:
C02/186HR.
120
Anton Piller order37 authorizing pre-trial discovery of Sharmans computers. For over a year, the right holders monitored every transaction and every
email transiting through the Sharman servers. This enabled them to establish
an extensive record concerning both the measures that could be taken to
control users, and Sharmans deliberate relinquishing of that control regarding
its principal P2P service.
Unlike the US, where liability for facilitating infringement is grounded in
the common law,38 the Copyright Act of Australia (as well as of the UK39 and
NZ40) makes authorization of infringement a direct violation of the statute.
Subsection (1) of s 101 of the 1968 Australian Copyright Act provides that a
copyright:
is infringed by a person who, not being the owner of the copyright, and without the
licence of the owner of the copyright, does in Australia, or authorizes the doing in
Australia of, any act comprised in the copyright.
The Federal Court ruled that the statute did not require that the defendant in
fact be able to prevent the infringement; the statutory language (if any)
suggested the possibility that the extent of the power might be nil.41 That
would be the case where, for example, a defendant deliberately disabled itself
from any ability to prevent the infringing uses it unleashed. Thus, the court
37
See Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55 (CA);
[1976] 1 All ER 779; [1976] 2 WLR 162. An Anton Piller order, used primarily in
copyright and patent infringement cases, is a court order, obtained ex parte, allowing a
plaintiff to search a defendants premises without prior warning. A plaintiff obtains an
Anton Piller order to prevent an alleged infringer from destroying or hiding incriminating evidence.
38
Although in both Grokster and Sony the court analogized to 271 of the
Patent Act, which codifies contributory infringement.
39
Copyright, Designs and Patents Act 1988 s. 16(2).
40
Copyright Act 1994 s. 16(1)(i).
41
Universal v Sharman, supra at 360.
121
The Kazaa decisions resemblance to Groksters three-point analysis is striking. Like the US Supreme Court, the Australian Federal Court addressed the
defendants promotion of the infringement-facilitating features of its service to
a risky demographic44 of likely infringers; the defendants deliberate failure
to filter out infringing content; and its infringement-dependent business plan.
The Australian court also noted the pretextual nature of such copyright-protective measures as Kazaa had taken (wink-and-nod website warnings not to
commit infringement). Despite the similarity of the respective courts
42
43
Id at 328, 330.
Courts summary; see also at 184 (I do not doubt that some people use Kazaa
only in a non-infringing way. However, it seems unlikely that non-infringing uses
would sustain the enormous Kazaa traffic claimed by the respondents. The explanation
of that volume of traffic must be a more populist use.), 40315 (legal conclusions
concerning authorization).
44
I have borrowed this phrase from Sverker Hgberg (2006), Note, Doctrinal
Problems in the Judicial Expansion of Secondary Copyright Liability, 106 Colum. L.
Rev 909.
122
approaches, however, the prospects of finding liability for enabling infringement may be greater in Australia than in the US, principally because there is
no precedent in Australia equivalent to Sony; the UK and Australian cases
addressing recording devices and media rejected authorisation liability based
on lack of control over the users acts, not on the non infringing uses to which
the recorders could be put.45
As a result, it is possible that, in the future, facilitators of online infringements may be more vulnerable in Australia than in the US. In the US, if bad
intent is not shown (or not inferred from the scale of the enabled infringements), the prospect of non-infringing uses (albeit in still-undefined proportion) may relieve the technology entrepreneur of liability for contributory
infringement. This may be true even where the entrepreneur relinquishes the
ability to control end-user conduct, at least where that relinquishment is not
probative of intent to induce. After Kazaa, by contrast, an entrepreneur who
deliberately foregoes control that it could have exercised had it designed its
service differently may well be found to have authorized the ensuing infringements. Whether the contrast is more theoretical than real may turn on whether
there are bona fide reasons to decline to undertake measures to prevent or limit
infringements. If there are not, the entrepreneur is likely to be held an inducer
in the US and an authoriser in Australia. If there are, the Sony standard may
protect the entrepreneur in the US; it is possible that an Australian court would
require a more persuasive showing that the bona fide explanation in fact
supplied the entrepreneurs reasons for declining to avoid infringements.
The possible difference in outcome poses some fascinating private international law consequences. Copyright law is generally territorial: liability in a
given State arises out of wrongful acts occurring or impacting in that State.
Unexcused copying in the US violates US copyright law, and unexcused copying in Australia violates Australian copyright law. Unexcused communication
to the US public violates US law, and unexcused communication to the
Australian public violates Australian law. But, unexcused communication
from Australia to the public outside Australia also appears to violate Australian
law.46 This suggests that a technology entrepreneur who makes it possible for
Australians to communicate works to the public outside Australia without the
45
See, e.g., CBS Songs Ltd v Amstrad Consumer Electronics plc [1988] 1 AC
1013 (H.L.) (multiple-headed tape recorder); WEA International Inc v Hanimex
Corporation Ltd (1987) 10 IPR 349 (blank tape); Australian Tape Manufacturers
Association Ltd v Commonwealth of Australia (1993) 176 CLR 480 (High Court Aus.)
(blank tape).
46
See Copyright Act of 1968 (Aus), as amended, s. 10 (to the public means to
the public within or outside Australia).
123
right holders permission may be violating Australian law, even if the entrepreneur would not be liable under the law of the recipients countries.47
CONCLUSION
The Grokster and Australian Kazaa decisions illustrate the adaptation of
general principles to problems spawned by new technologies. Even though
Kazaa applies a statutory text, the reasoning draws on broader pre-statutory
case law, and seems largely consistent with the US Supreme Courts federal
common law analysis in Grokster. The two decisions may also have taken
some of the wind out of the sails of proposals to substitute a P2P levy scheme
for authors exclusive rights.48 At least to the extent those proposals were
propelled by an nergie du dsespoir at copyrights apparent inability to
confront the latest technological challenge, an effective compensation right
seemed more appealing than a hollow exclusive right. But if, as more recent
decisions suggest, copyright can rein in the intermediaries who enable
infringement for their own profit, then the climate may prove conducive to
licensing P2P exploitations. The goal, after all, is not to extirpate new modes
of exploitation, but to bring them within the zone of exclusive rights so that
authors may avail themselves of technological advances for the benefit of both
consumers and copyright owners.
47
For extensive analysis of the international consequences of the Kazaa and
Grokster analyses, see Graeme W. Austin (2006), Importing KazaaExporting
Grokster, Santa Clara Computer & High Technology Journal, Vol. 22, p. 577.
48
For examples of these proposals, see Jessica Litman (2004), Sharing and
Stealing, 26 COMM/ENT 1; Neil W. Netanel (2003), Impose a Noncommercial Use
Levy to Allow Free Peer-to-Peer File Sharing, 17 Harv J. L. & Tech. 1.
Decisions subsequent to Grokster and Kazaa in other countries have also held
against the facilitating intermediary. See A. Strowel and P.Y. Thoumsin (2005), Le
P2P: un problme pressant en attente dune rponse lgislative?, Proprits intellectuelles, No. 17, pp. 428434, citing developments in Taiwan, Kuro Conviction
Threatens P2P, 10 September 2005.
1
Protecting Innovation and Art While Preventing Piracy: Hearing on s 2560,
The Intentional Inducement of Copyright Infringement Act of 2004, Before the
Subcommittee on the Judiciary, 109th Cong (2004) (statement of Hon Marybeth
Peters, Register of Copyrights).
2
Universal Music Australia Pty Ltd v Sharman License Holdings Ltd (2005)
220 ALR 1 [Kazaa].
124
125
Federal Court in Cooper v Universal Music Australia Pty Ltd,3 and the famous
decision of the United States Supreme Court in Metro-Goldwyn-Mayer
Studios Inc v Grokster.4 The second section of this chapter introduces the
liability theories developed in the Australian cases and then discusses recently
enacted Australian legislation that allows courts to apply Australian law to
copyright material that reaches a public outside its borders. It also explores
other possibilities for extraterritorial application of relevant liability theories
arising under Australian law.
The third section explores the opportunities for applying the inducement
theory of copyright infringement that was developed by the US Supreme
Court in Grokster to conduct occurring in foreign jurisdictions. Copyright
owners may have welcomed the new inducement theory announced by the
Grokster court.5 Yet litigants may soon be embroiled in the task of determining how the theory might apply to conduct that occurs abroad. This section
first identifies the potential, within the increasingly fluid doctrine on the territoriality of intellectual property rights,6 for application of the Grokster inducement theory to activity occurring in foreign jurisdictions. It then considers the
issue of de facto exporting of indirect liability theories, and examines Breyer
Js concurring opinion in Grokster to explain this concept. The fourth section
offers a brief exploration of the relevance of public international law to the
development of a sound private international law regime for the P2P context.
Cooper v Universal Music Australia Pty Ltd v Sharman License Holdings Ltd
[2006] FCAC 187 (Full Federal Court of Australia) [Cooper].
4
Metro-Goldwyn-Mayer Studios Inc v Grokster Ltd, 125 S Ct 2764 (2005)
[Grokster].
5
The Grokster court adapted this theory from US patent law. The Patent Act
now codifies the inducement theory. See 35 USC 271(b): Whoever actively induces
infringement of a patent shall be liable as an infringer.
6
Quality King Distributors Inc v LAnza Research International Inc, 523 US
135 at 154 (1998) (Ginsburg J concurring) (describing copyrights territoriality principle as: Copyright protection is territorial. The rights granted by the United States
Copyright Act extend no farther than the nations borders (quoting P. Goldstein (1998),
Copyright, 2nd ed (Aspen Law and Business, New York).
7
Copyright Act 1968 (Cth) s. 101(1) (emphasis added).
126
number of non-exclusive factors that courts are required to take into account
when considering liability for authorising copyright infringement:
(a) the extent (if any) of the persons power to prevent the doing of the act
concerned;
(b) the nature of any relationship existing between the person and the person who
did the act concerned;
(c) whether the person took any other reasonable steps to prevent or avoid the doing
of the act, including whether the person complied with any relevant industry codes
of practice.8
These factors build on9 judicial analyses in a long line of Australian and
Commonwealth cases that have considered the scope of the concept of
infringement by authorisation.10 The statutory factors are not exhaustive,11
and they can be supplemented as the particular facts of cases demand.
Significantly, the factors appear to provide for a finding of authorisation in
situations in which the authorising defendant cannot control the end user, as is
implied by the use of the words if any in the first factor.12
In some Commonwealth jurisdictions, the interpretation of authorise in
the copyright infringement context had become fairly narrow. The House of
Lords held in CBS Songs Ltd v Amstrad Consumer Electronics plc,13 a case
involving a dual audio cassette player, that to authorise means a grant, or
purported grant, which may be express or implied, of the right to do the act
complained of.14 This standard was meant to be narrower than an earlier test
that focused on whether the defendant sanctions, approves, or countenances
infringement by another.15 Under this test, the purveyors of the tape deck were
not liable for copyright infringement.
8
9
127
16
17
128
21
The system gave Altnet knowledge of the IP addresses of the Kazaa users.
Ibid, at 367 (Wilcox J.).
22
The court also made formal declarations that such infringement had occurred.
Ibid, at 68 (Wilcox J.).
23
Kazaa (2005) 220 ALR 1 at 7 (Wilcox J.).
24
Cooper [2006] FCAFC 187.
129
The Court concluded that the defendant had authorized copyright infringement
by establishing and maintaining a website that was structured so that when a
user clicked on a link to a specific music file a copy of that file was transmitted directly to the users computer.26 It was immaterial that the website
operated automatically in the sense that, although [defendant] could edit links
on the site, [defendant] did not control the usual way in which links were
added to the site.27 The inexorable inference from the evidence was that it
was the deliberate choice of [defendant] to establish his website in a way that
allowed automatic addition of hyperlinks.28
In Kazaa, the Court did not distinguish between direct infringements or acts
of authorisation that occurred in Australia and those that occurred outside
Australia. The holding and remedy were only loosely tethered within territorial confines. For example, the modifications of the Kazaa system required by
the court were directed at the software received by all new users of the Kazaa
file-sharing system. Similarly, all future versions of the Kazaa system were to
include filter technology, and maximum pressure was to be placed on existing
users without limitation to those in Australia to upgrade to a system that
deploys these filters. There was no apparent restriction on the location of the
users or to where new versions of the Kazaa system software were to be
distributed. The record did disclose that there was a significant volume of
25
26
27
28
130
Article 8 applies to the full bundle of rights of the copyright owner, and was
intended to pave over gaps in the rights to disseminate copyright protected
works provided in the Berne Convention.31 The WCT is silent on the extra29
30
131
132
The Australian Act thus appears to limit direct liability for unlicensed communication by defining the person making the communication as the person
responsible for determining the content of the communication.36 One cannot
be held liable for communicating a work to the public merely by providing the
facilities by which a communication is made; nor can one be held liable unless
one is responsible for determining the content of the communication. Because
users generally determine the content of communications facilitated by P2P
networks, there may be significant obstacles to imposing liability on those
responsible for providing P2P products or services that directly communicate
a work to the public.
But if the territorially confined authorization tort is layered onto the
communication concept, Australian law might offer copyright owners some
quite powerful legal mechanisms capable of reaching many unlicensed foreign
communications of copyright protected works. If the users of P2P services are
considered responsible for the content of the communication by, for instance,
making copyright protected works available for downloading by others (works
they have at some stage selected themselves by downloading them from other
users), they would appear to be primarily liable for all communications,
domestic and foreign. If a party is liable for authorising those unlicensed
communications, the indirect liability theory also has the potential to reach
both communications within Australia and those made to P2P users in foreign
territories. The leading English authority on authorisation, Abkco Music &
Records Inc v Music Collection International Ltd,37 is consistent with this
point. The English Court of Appeal held that a foreign firm that authorised
infringement of copyright by primary acts within the United Kingdom was
liable for authorising infringement under the English copyright statute. If,
under Australian law, the act of authorisation does not itself need to have
occurred on Australian soil, a firm operating outside of Australia may, in some
circumstances, be found to have authorised communications that begin from
Australia, even if the communications themselves are directed or made available to users outside of Australia. Put another way, the Australian regime
might imply that, so long as theres a communicator located in Australia,
Australian law can reach the conduct of, say, a British firm whose conduct can
be characterised as authorizing infringing communications to the United
Kingdom and every other country to which they are transmitted.38
36
37
38
133
39
See, e.g., Boosey & Hawkes Music Publishers, Ltd v Walt Disney Co, 145 F
3d 481 (2nd Cir, 1998).
40
Pearce v Ove Arup Partnership Ltd [2000] Ch 403.
41
The English Court of Appeal in Pearce considered the subject matter jurisdiction issue first under the Brussels Convention, and then according to general
common law principles, suggesting that the ruling has significance outside of the
European Union. See also Lucasfilm Ltd v Ainsworth [2008] EWHC 1878 (Ch) (31 July
2008).
42
549 U.S. at 93940.
134
The Grokster Court was not required to consider any international issues.
Were such issues to arise, the Courts statement of the holding would invite
analysis of a number of questions. For example, are all uses promoted by P2P
services relevant to determining if the defendant induced copyright liability,
including those that occur abroad? Would it matter if many of the former
customers of an illegal service for which a defendant sought to substitute were
also located abroad? Would it be relevant if the advertisements that supported
defendants business model were targeted only to US consumers?
On the facts of Grokster, these issues would likely have been regarded as
moot. Even if analysis of the factual matrix supporting the Grokster holding
were confined to purely domestic activity, there would almost certainly be
enough domestic infringing acts, in terms of the sheer volume of primary
infringers and targeted advertising, to make concern with the foreign conduct
largely redundant. In the foreseeable future, however, purveyors of software
tools facilitating the creation and maintenance of P2P networks may become
more nimble, with services targeted more sharply at niche markets, both in
terms of audience and content.43 It is possible that numbers and geography
may begin to have greater significance.
De jure Exporting of Intellectual Property Liability Theories
At first blush, extant US copyright doctrine appears to impede application of
US copyright in cases where the primary infringers are located beyond the
forum. In Subafilms Ltd v MGM-Pathe Communications Co,44 for example,
the US Court of Appeals for the Ninth Circuit has held en banc that the authorization tort did not constrain authorisation in the United States of actions in
foreign territories, regardless of whether the acts would have constituted
infringements if done within the United States. The Court of Appeals
grounded its analysis of the cross-border questions in the territoriality of
domestic copyright law,45 a concept that the Supreme Court had endorsed
early in the 20th century.46 The corollary of the Ninth Circuits endorsement
of the territoriality of copyright law is that the lex protectionis governs the
43
See, e.g., Irish Software Designer to Create P2P Network Secured from
Official Monitoring, 1 August 2005, available at http://newsfromrussia.com/science/
2005/08/01/60884.html (reporting on announcement by software designer, Ian Clark,
to create a new P2P network that would include only invited, trusted users).
44
24 F 3d 1088 (9th Cir, 1994).
45
Ibid, at 10959.
46
See United Dictionary Co v G & C Merriam Co, 208 US 260 (1908); Ferris
v Frohman, 223 US 424 (1912).
135
47
For a meticulous exploration of the limits of the principle of lex protectionis
in copyright law, see Mireille von Eechoud (2003), Choice of Law in Copyright and
Related Rights: Alternatives to the Lex Protectionis (Kluwer Law International,
London).
48
Itar-Tass Russian News Agency v Russian Kurier Inc, 153 F 3d 82 (2nd Cir,
1998).
49
Subafilms Ltd v MGM-Pathe Communications Co, 24 F 3d 1088 at 10978
(9th Cir, 1994).
50
Ibid, at 1097.
51
Ibid.
52
G.W. Austin (2002), Valuing Domestic Self-Determination in International
Intellectual Property Jurisprudence, 77 Chicago-Kent Law Review 1155.
53
Ibid.
54
Sony, 464 US 417 at 435 n. 17 (1984): the lines between direct infringement,
contributory infringement and vicarious liability are not clearly drawn quoting 480
F Supp 429 at 4578.
136
A district court in New Jersey has adopted a similar approach, reasoning that
Wiseman J.s analysis was more sensitive to the modern age of telefaxes,
Internet communication, and electronic mail systems.57 The New Jersey court
saw the authorisation tort as preventing infringement of copyright by an entity
merely directing its foreign agent to do its dirty work.58
Subafilms is now over a decade old, and its analysis arose from a
completely different context than P2P networks. It also predates the massive
threats to copyright owners interests posed by digitisation and the Internet, as
did the Supreme Court cases on which the Ninth Circuit drew. One can sense
in the district courts analysis some frustration about domestic copyright
owners vulnerability to foreign piracy, which may be exacerbated by strict
insistence on territoriality. Courts in the leading copyright circuits distinguish
Subafilms where a predicate act of infringement occurring within the United
States facilitates infringement abroad.59 Rightly or wrongly, the predicate act
theory has the potential to be quite protective of domestic copyright owners
interests in foreign territories, even in cases in which liability under the copyright laws of the relevant foreign state(s) has not been established.60
55
P. Koneru (1996), The Right to Authorize in US Copyright Law: Questions
of Contributory Infringement and Extraterritoriality, 37 IDEA The Journal of Law
and Technology 87 (criticising the Ninth Circuit in Subafilms for inappropriately adopting the requirement in contributory infringement that there be an infringing primary
act).
56
Curb v MCA Records Inc, 898 F Supp 586 at 595 (MD Tenn, 1995).
57
Expediters International of Washington Inc v Direct Line Cargo Management
Services Inc, 995 F Supp 468 at 477 (DNJ, 1998).
58
Ibid.
59
See, e.g., Los Angeles News Service v Reuters Television International, Ltd,
149 F 3d 987 (9th Cir, 2005).
60
Sheldon v Metro-Goldwyn Pictures Corp, 106 F 2d 45 (2nd Cir, 1939).
137
Moreover, because temporary digital storage is considered a legally cognisable copy according to US copyright law, the predicate act theory has the
potential to catch a significant amount of foreign copying.61 Because P2P
networks are usually not geographically segregated, temporary copies of files
to pass through local nodes quite often. If a liability theory can catch an
unauthorised copy that occurs in the United States, then it would seem to be
consistent with the predicate act theory for it too provides pecuniary relief for
all the further foreign infringements that the local copy facilitates.
Without definitive guidance from the Supreme Court, lower courts willingness to apply Grokster in cases that involve foreign conduct, and in which
litigants have questioned the geographical scope of the liability theory at issue,
will likely depend on how rigidly future courts view the territoriality principle.
Arguably, application of the predicate act theory will very often be an affront
to a strict understanding of the territorial premise of the international copyright
treaty regime, as much as extraterritorial application of the authorization
tort.62 Further extension of the theory may be even more so.63 With this in
mind, however, one should also question whether it is always contrary to the
spirit of the Berne Convention to adapt liability theories to stem the tide of
massive copyright infringement over international communications networks.
Before considering that question in detail, it may be helpful first to consider
briefly the rapidly evolving doctrine on the territorial reach of US patent and
trademark laws. This doctrine may shed some helpful light on US courts attitude towards the territoriality issue in intellectual property generally. In the
patent context, recent decisions from both the Federal Circuit and the Supreme
Court evince some hostility to plaintiffs who seek to use US fora to or invoke
US patent law police infringing activities in foreign territories. In a muchawaited 2007 decision, Voda v Cordis Corporation,64 the Court of Appeals for
the Federal Circuit declined to exercise jurisdiction over a plaintiffs allegations of infringement of foreign patents. Though the decision was limited to a
particular species of US federal jurisdiction,65 the Federal Circuit held, over a
61
J.C. Ginsburg (1998), The Private International Law of Copyright in an Era
of Technological Change, 273 Recueil Des Cours 239 at 341.
62
G.W. Austin (1999), Domestic Laws and Foreign Rights: Choice of Law in
Transnational Copyright Infringement Litigation, 23 Columbia-VLA Journal of Law
and the Arts 1.
63
Ginsburg, above n. 61, at 347.
64
476 F.3d 887 (Fed.Cir. 2007).
65
Technically, the holding in Voda was limited to supplemental subject matter
jurisdiction arising under 28 USC 1367. In Baker-Bauman v Walker, 2007 WL
1026436, a district judge in the Southern District of Ohio distinguished Voda in a case
involving diversity jurisdiction under 28 USC 1332(a), but noting that such a case
could still be dismissed on forum non conveniens grounds.
138
strenuous dissent, that considerations of comity, judicial economy, convenience, fairness and other exceptional circumstances provided compelling
reasons to decline jurisdiction over the allegations of foreign patent infringement. If this approach becomes generally applicable, it will be necessary for
parties to litigate allegations of patent infringement occurring in a number of
different territories seriatim that is, in each of the different jurisdictions in
which each national patent is alleged to have been infringed.
The US Supreme Court has recently been engaged with a related set of
questions concerning the territorial scope of US patent law. In Microsoft v
AT&T Corp.,66 an April 2007 decision, the Court held that the US Patent Act
did not apply to a situation in which a defendant sent computer software from
the United States (either on a disk or by electronic transmission) to a foreign
manufacturer for installation on computers made and sold abroad. Generally,
there is no infringement under the US Patent Act where a product is made and
sold in another country. However, an exception enacted in 1984 applies where
a party suppliesfrom the United States, for combination abroad a
patented inventions components.67 In AT&T, the Court reasoned, in essence,
that copies of software supplied from the United States could qualify as
components, but that liability did not attach merely to supply of the program
in the abstract. Accordingly, supply of a single copy from the United States
did not qualify under the section. The copies that were loaded onto the
machines manufactured abroad were not therefore supplied from the United
States; rather they were supplied from places outside the United States. The
Courts reasoning suggests that the 1984 amendment envisaged the supply of
things; the ease of copying software did not make the supply of a single copy
the supply of components from the United States for the purposes of assembly abroad. In other words, because the copies did not exist until they were
generated by third parties outside the United States, the statute did not apply.
In AT&T, the Court accompanied its statutory interpretation analysis with a
statement about the propriety of extending the reach of US law to conduct in
foreign territories. Any doubt about the statutory interpretation point, the
Court reasoned:
would be resolved by the presumption against extraterritoriality, on which we have
already touched. The presumption that United States law governs domestically but
does not rule the world applies with particular force in patent law. The traditional
understanding that our patent law operate[s] only domestically and d[oes] not
extend to foreign activities, is embedded in the Patent Act itself, which provides
that a patent confers exclusive rights in an invention within the United States.
66
67
139
[]
As a principle of general application, moreover, we have stated that courts should
assume that legislators take account of the legitimate sovereign interests of other
nations when they write American laws. Thus, the United States accurately
conveyed in this case: Foreign conduct is [generally] the domain of foreign law,
and in the area here involved, in particular, foreign law may embody different
policy judgments about the relative rights of inventors, competitors, and the public
in patented inventions. Applied to this case, the presumption tugs strongly against
construction of [the statute] to encompass as a component not only a physical copy
of software, but also softwares intangible code, and to render supplie [d] ... from
the United States not only exported copies of software, but also duplicates made
abroad.68
68
69
70
71
140
US law, and on the related topic of the receptiveness of US courts to allegations of infringement that implicate foreign laws, appears to be pulling in a
number of different directions. In P2P cases, and indeed in any intellectual
property case involving foreign conduct, parties on each side should consider
whether it may be advantageous to raise the issue of the location of any activities that are relevant to the applicable liability theory.
De facto Export of Liability Theories
The doctrinal developments discussed immediately above all involve issues of
de jure applications of US intellectual property law, applications that directly
confront the territoriality of domestic laws. In the networked environment,
however, domestic laws do not necessarily have to be deliberately applied to
foreign conduct to have effects in other jurisdictions. Justice Breyers concurring opinion in Grokster illustrates that there is also potential for de facto
application of US copyright law.
Justice Breyer joined the Courts unanimous opinion holding that inducement of copyright infringement was a viable liability theory for the P2P
context. If the inducement theory were not available on the facts, however,
Justice Breyer, and two Justices who joined his opinion, OConnor and
Stevens JJ, would have upheld the granting of summary judgment based on the
test articulated in the famous decision in Sony Corp of America v Universal
Studios Inc72 in favour of the Grokster defendants. Sony provides a safe
harbour for those who, without more, market products that are capable of uses
that infringe copyrights as well as substantial non-infringing uses. Justices
Breyer disagreed with Justice Ginsburg, who authored another concurring
opinion, as to the evidence required to establish whether a product complied
with the Sony standard for purposes of summary judgment. These Justices also
disagreed about how to characterise the volume of non-infringing uses that the
Sony safe harbour requires, a question that the Sony court did not directly
address. Justice Breyer suggested that a product would fall outside of the Sony
standard if it will be used almost exclusively to infringe copyrights.73 Justice
Ginsburg and the two justices who joined her opinion, Rehnquist CJ and
Kennedy J, cited cases indicating that lower courts have required substantial
and predominant non-infringing uses to enable a defendant to qualify.74 On
this view, the relative amounts of infringing and non-infringing conduct may
be more important for the application of the Sony standard.
72
73
74
141
75
76
77
Ibid, at 2784.
Ibid, at 2790.
See J.C. Ginsburg (2005), Nouvelles des Etats Unis: Responsabilit pour
complicit de contrefaon La dcision de la Cour Suprme du 27 juin 2005 dans laffaire MGM v Grokster, 11 Auteurs & Mdias 290 (suggesting that Breyer Js assertion
that copyright law favours technology is warranted by neither the Copyright Act 1976
nor the Copyright Clause in the Federal Constitution).
78
Grokster, 125 S Ct 2764 at 2793.
142
79
80
143
144
recently in F HoffmannLaRoche Ltd v Empagran SA,81 a case where plaintiffs urged the court to mandate application of US antitrust law to foreign
conduct. Empagran was premised on an assumption that the commercial activity in the relevant markets was independent of the effects on United States
commerce.82 In contrast, it is hard to imagine a case in which domestic and
foreign effects are more intertwined than one involving P2P products and
services in which no geographical or other filtering devices have been applied
by the designers.
P2P products and services distil a paradox: practical steps to enforce the
rights of copyright owners under domestic law will almost inevitably lead to
application in foreign territories of the applicable law, something that is most
pertinently demonstrated by the silence of both the Grokster and the Kazaa
courts on the international reach of their holdings. On the other hand, as the
discussion above of Breyer Js Grokster concurrence attempts to demonstrate,
lower levels of enforcement of copyright is also very likely to have significant
effects on other nations copyright regimes. Faced with this paradox, perhaps
the best that we can do is to work toward identifying common values that
may assist in guiding tribunals and legislatures that must contend with the
interrelationship between different legal systems in the international copyright
context.83
Public and Private International Law
In a technological and legal context where legal standards developed in one
nation can easily affect policies developed in others, it may be appropriate to
look to public international norms for guiding principles. The idea that public
international law principles should influence the development of domestic law,
particularly where one nations acts affect others, has a long legal pedigree,
and in the copyright context, reflects a broad consensus among many84 nations
about appropriate legal ordering for copyright matters.85
81
82
145
146
it has seen the light, can no longer be restricted to one country and to one nationality. If it possesses any value, it is not long in spreading itself in all countries, under
forms which may vary more or less, but which, however, leave in its essence and its
principal manifestations the creative idea. This is why, after all civilized States have
recognised and guaranteed by their domestic legislation the right of writer and of
artist over his work, the imperative necessity has been shown of protecting this right
in international relations, which multiply and grow daily.90
CONCLUSION
Promoters of P2P products and services, along with other groups including
activists, litigants, and a number of academics, have made sustained efforts in
recent years to challenge the idea that copyright protection, and intellectual
90
December 1883, circular note from the Swiss government to the governments
of all civilized nations. Reprinted in Actes de la Confrence internationale pour la
protection des droits dauteur runie Berne du 8 au 19 Septembre 1884 (1884) pp.
89, cited in S. Ricketson (1987), The Berne Convention for the Protection of Literary
and Artistic Works: 18861986 (Kluwer, London), p. 54.
91
Berne Convention, above n. 31, Preamble.
92
See Ricketson at 74.
147
93
94
Higgins at 58.
This criticism of the Australian decision was quickly made by Prof. Kim
Weatherall in her regular blog on IP issues: http://weatherall.blogspot.com/
2005_09_01_weatherall_archive.html#112592939140783823.
148
149
See Lawrence Lessig (2004), Free Culture: The Nature and Future of
Creativity p. 296; Peer to Peer Networks in OECD Countries, OECD Information
Technology Outlook 2004, available at http://www.oecd.org/dataoecd/55/57/
32927686.pdf, 2.
4
See, for example, (2004) Streaming Media, 12 Wired 6, 1489; Lessig, supra
n. 3, at 10; Fisher, supra n. 1, at 82; Daniel J. Gervais (2004), The Price of Social
Norms: Towards a Liability Regime for File-Sharing, 12 J. Intell. Prop. L. 39, 40.
5
See infra non-voluntary licenses regarding P2P file sharing at p. 154.
6
Berne Convention for the Protection of Literary and Artistic Works, Paris Act
of 24 July 1971, as amended on September 28, 1979.
7
Agreement on Trade-Related Aspects of Intellectual Property Rights of 15
April 1994.
8
WIPO Copyright Treaty and Agreed Statements Concerning the WIPO
Copyright Treaty, adopted in Geneva on 20 December 1996.
9
See Berne Convention for the Protection of Literary and Artistic Works,
http://www.wipo.int/treaties/en/ip/berne/index.html.
10
See the WTO, http://www.wto.org/english/thewto_e/thewto_e.htm.
11
See WIPO Copyright Treaty, http://www.wipo.int/treaties/en/documents/
pdf/s-wct.pdf.
12
See Daniel J. Gervais (2005), Towards a New Core International Copyright
Norm: The Reverse Three-Step Test, 9 Marquette Intell. Prop. L. J. 1, available at
http://ssrn.com/abstract=499924, at 33; Jane C. Ginsburg (2001), Toward
Supranational Copyright Law? The WTO Panel Decision and the Three-step Test for
150
tested for conformance with these requirements under international law. For
example, the German Ministry of Justice already declined to adopt a new limitation to copyright with regard to non-commercial file sharing, explicitly referring to the three-step test under Berne.13
Further, the dispute settlement system of the GATT/WTO, makes it possible to enforce rules of an international treaty on intellectual property for the
first time.14 When one country adopts a trade policy measure or takes some
action that one or more fellow WTO members consider to be breaking the
WTO agreements, including TRIPS,15 a dispute settlement procedure can be
instituted. According to the Uruguay Round Understanding on Rules and
Procedures Governing the Settlement of Disputes (DSU), the Dispute
Settlement Body may authorize the imposition of trade sanctions if the target
of the complaint does not follow the recommendations of the panel report or
the appeals report.16 As of October 2005, the WTO homepage lists 24 dispute
settlement procedures relating to TRIPS,17 including a procedure concerning
US copyright law. The WTO Panel held that 17 USC 110(5) was a violation
of US obligations under the TRIPS Agreement.18 As a result the US, as a
temporary arrangement between the US and the EC, agreed to make a lumpsum payment in the amount of $3.3 million to a fund to be set up by performing rights societies in the European Communities for the provision of general
assistance to their members and the promotion of authors rights for a three-
Copyright Exceptions, 187 Revue Internationale du Droit dAuteur (RIDA) 3; but see
Pierre Sirinelli, Exceptions and Limits to Copyright and Neighbouring Rights,
Workshop on Implementation Issues of the WIPO Copyright Treaty (WCT) and the
WIPO Performances and Phonograms Treaty (WCCT), WIPO Document WCTWPPT/IMP/1 of 3 December 1999, available at http://www.wipo.int, 42 (stating that
the three-step test is far from providing harmonization).
13
See Bill for a Second Act on Copyright in the Information Society of 27
September 2004.
14
In a WTO Dispute Settlement Proceeding, the one invoking the restriction to
minimum rights under TRIPS bears the burden of proof. See Panel Report, United
States-Section 110(5) of US Copyright Act, WT/DS160 (15 June 2000), para. 6.9-16;
Panel Report, Canada-Patent Protection of Pharmaceutical Products, WT/DS114/13
(17 March 2000), para 7.16.
15
See Art. 64 TRIPS.
16
See Understanding on Rules and Procedures Governing the Settlement of
Disputes, 15 April 1994, Marrakesh Agreement Establishing the World Trade
Organization, Annex 2, Legal Instruments-Results of the Uruguay Round, 33 I.L.M.
1226 (1994).
17
See Index of Dispute Issues, http://www.wto.org/english/tratop_e/dispu_e/
dispu_subjects_index_e.htm#bkmk137.
18
See Panel Report, United States-Section 110(5) of US Copyright Act, supra n.
14.
151
19
See Notification of a Mutually Satisfaction Temporary Agreement, United
States-Section 110(5) of the US Copyright Act, WT/DS160/23 (26 June 2003).
20
On the difficulties amending the TRIPS Agreement see Gervais, supra n. 12,
at p. 28 (far from simple politically); Gervais, supra n. 4, at 71 (any proposal to
license P2P should take account of applicable international treaties); Peter Eckersley
(2004), Virtual Markets for Virtual Goods: The Mirror Image of Digital Copyright?,
18 Harv. J.L. & Tech. 85, 157.
21
See infra international copyright law at p. 159.
152
products. Users want to benefit from cheap, worldwide, and unrestricted access
to information contained in published works. It is no wonder that when even the
facts are controversial22 the possible solutions will be even more so.
In light of these developments, one commentator rightly describes the
current situation as a kind of logjam.23 On the one hand, P2P networks are
still intensely used and technologically improved for the sharing of digitized
content, some of which is copyrighted. On the other hand, right holders are
trying everything to bring an end to this allegedly harmful institution. This,
however, is not to say that nobody has an idea of how to resolve this conflict.
On the contrary, postulations cover the whole spectrum, from abolish copyright to abolish P2P networks.
Two of these approaches would not require legislative actions. First, a
wait-and-see approach argues that the market will provide an efficient result,
especially in the form of differential pricing, even if the legislature refrains
from stepping in.24 Second, several commentators and the Electronic Frontier
Foundation plead instead for voluntary collective licensing of exclusive rights.
Under the EFFs proposal, the music industry would form a collecting society
and then offer file-sharing users the opportunity to get legit by making a
reasonable regular payment (the EFF specifies $5 per month). So long as they
pay, users would be free to download whatever they like, using whatever software works best for them.25
22
153
The problem with both approaches is that they have not yet become reality.
Copyright owners establish more and more commercial online ventures where
users can stream and download legally and pay for these uses individually. But
neither these lawful alternatives to file sharing, nor civil and criminal actions
have lead to a decrease of traffic in P2P networks.26 Thus, uncontrolled use of
copyrighted works takes place as ever without generating revenues for artists
and right holders. The market has not solved the problem. Whether it ever will
is uncertain. Interestingly enough, the failure to stop unauthorized file sharing
has not put enough pressure on copyright owners to agree on a voluntary
collecting and licensing scheme as proposed by the EFF and others. Right
holders are still betting on exclusivity in cyberspace.27
Not surprisingly, therefore, both parties have turned their attention to the
legislature.28 Several proposals have been put forward, differing substantially
with respect to the aim and the practical solution suggested. At the extremes,
anti-copyright models plead for a complete or nearly complete abandonment
of copyright as an exclusive right in the digital network environment, arguing
that exclusive rights in cyberspace would do more harm than good.29 The
beyond copyright model instead proposes a digital lock up to stop infringing uses on the net.30 Looking for a middle ground that acknowledges the need
of right holders to enforce their exclusive rights effectively against illegal uses
in P2P networks without banning these technologies altogether, Mark A.
Lemley and R. Anthony Reese have outlined a streamlined and largely online
administrative proceeding overseen by the Copyright Office that gives copyright owners a quick, low-cost alternative to enforcing their rights against individual large-scale uploaders on P2P networks.31
26
27
154
Also somewhere in the middle of this spectrum of control are proposals for
future copyright models regarding P2P networks that would replace exclusive
rights in copyrightable subject matter with mandatory remuneration rights. The
fundamental notion of these concepts is that efficient control of the use of P2P
network technology is not possible without banning the technology altogether or
without severe drawbacks with regard to monitoring and privacy. To avoid these
disadvantages, non-commercial file sharing would be legalized under a limitation of or exception from copyright. Right holders would be compensated by a
levy or tax on products and services used for file sharing. The congeniality of
this solution rests upon the fact that it preserves the benefits of P2P network
technologies while at the same time guaranteeing authors compensation. In
Lawrence Lessigs words, it is compensation without control.32
anism through a form of non-binding arbitration which could rapidly resolve copyright
infringement cases on the Internet at low litigation expense, see also Alan R. Kabat
(1998), Proposal for a Worldwide Internet Collecting Society: Mark Twain and
Samuel Johnson Licenses, 45 J. Copyright Society of the USA 329, 341.
32
Lawrence Lessig (2001), The Future of Ideas: The Fate of the Commons in a
Connected World; Shih Ray Ku, supra n. 1, at 263.
33
Netanel, supra n. 23, at 32.
34
See Philipp Wittgenstein (2000), Die digitale Agenda der WIPO-Vertrge, p.
162 (stating that copyright on the Internet should be transformed from an exclusive
right to a mere remuneration right); Artur-Axel Wandtke (2002), Copyright und
virtueller Markt in der Informationsgesellschaft, Gewerblicher Rechtsschutz und
Urheberreht (GRUR) 1, 7 (arguing that the future protection of authors will probably
amount to mere remuneration rights).
155
several solutions addressing the fact that copyright, as it exists today, does not
meet the needs of a functioning information society. Among these solutions,
the author lists compulsory licenses, especially for sui generis rights in databases,35 and mandatory collective administration of exclusive rights, where
collecting societies woould be required to license certain uses on a nondiscriminating, fair basis,36 a model that ultimately is very similar to a statutory, non-voluntary license.37
Interestingly, a richer set of proposals for non-voluntary licenses applied to
P2P file sharing can be found in recent US literature.38 Glynn S. Lunney argues
that a levy or limited tax on copying technology and storage media for private
copying is inescapable, taking into account the dangers of an encryptionbased approach.39 Raymond Shih Ray Ku is very much in line with this
reasoning with his proposal of a Digital Recording Act as a second-best solution if the abolishment of copyright would hamper the incentive to be creative.
This Act would allow file sharing, but would introduce statutory levies on
subscriptions for Internet services and on the sales of computer, audio, and
video equipment. In order to measure the extent of downloads and other uses
35
Christophe Geiger (2004), Droit dauteur et droit du public linformation.
Approche de droit, compare para. 370380 (R.D.T.I.); see also Christophe Geiger
(2005), Right to Copy v Three-Step Test, Computer L. Rev. Intl (CRi) 7, 10 (stating
that it would be preferable to admit private copying as an enforceable right against
technical devices and to solve the problem by a working system of equitable remuneration).
36
Geiger, supra n. 35, at para. 38184; Lucie M.C.R. Guibault (2002),
Copyright Limitations and Contracts. An Analysis of the Contractual Overridability of
Limitations on Copyright, pp. 2627.
37
See Guibault, supra n. 36, at 2627. On mandatory collective administration
of exclusive rights without the obligation of the collecting society to license certain
uses, see Silke von Lewinski (2004), Mandatory Collective Administration of
Exclusive Rights A Case Study on Its Compatibility with International and EC
Copyright Law, UNESCO e.Copyright Bulletin, No. 1.
38
See also the proposals by Jim Griffin (April 2001), At Impasse: Technology,
Popular Demand, and Todays Copyright Regime, available at http://www.62chevy.
com/at_impasse.htm; Bennett Lincoff (22 November 2002), A Full, Fair and Feasible
Solution to the Dilemma of Online Music Licensing, available at http://www.
quicktopic.com/boing/D/uhAMNwVb8yfkc.html; Philip S. Corwin & Lawrence M.
Hadley (2004), P2P: The Path to Prosperity, 24 Loy. L. A. Ent. L. Rev. 649, 669;
Eckersley, supra n. 20, at 92 (virtual market reward/remuneration system). Lionel
Sobels Digital Retailers model (Sobel, supra n. 30, at 667, 673 et seq.) should not be
listed among the proponents of a non-voluntary license for non-commercial file sharing; see Lemley & Reese, supra n. 30, at 1410 (stating that Sobels model is not a levy
at all, because it depends on identifying and collecting from infringers).
39
Glynn S. Lunney (2001), The Death of Copyright: Digital Technology,
Private Copying, and the Digital Millennium Copyright Act, 87 Va. L. Rev. 813,
910918.
156
40
Shih Ray Ku, supra n. 1, at 31115; Raymond Shih Ray Ku (2003),
Consumers and Creative Destruction: Fair Use Beyond Market Failure, 18 Berkeley
Tech. L.J. 539, 566 n.160.
41
Jacover, supra n. 30, at 225054, with reference to Kabat, supra n. 31, at
33637, who proposed a Worldwide Internet Collecting Society (WICS) which,
contrary to the proposals discussed in this chapter, was meant to administer the exclusive rights of authors in cyberspace.
42
Netanel, supra n. 23, at 4, 3559.
43
Fisher, supra n. 1, at 199251.
157
Fisher allows right holders a hybrid marketing strategy, that is, to sell
copy-protected CDs while simultaneously distributing unencrypted
versions of the song, receiving shares of the tax for these uses.46 In addition, copyright owners would be free to implement DRM without registering their work for the tax system.47 The statutory default, however, would
be a limitation for non-commercial file sharing. It would also apply to
works not registered.48
In The Future of Ideas, Lawrence Lessig argued that file sharing should be
empowered by recognizing a system of compulsory licenses similar to those
used in cable retransmission, the fee being set by a policy maker striking the
right balance.49 In his 2004 book Free Culture, he still agrees with Fishers
proposal, but he also stresses that the current P2P network technology might
become irrelevant when faster and easier Internet access will empower users to
switch from downloading to streaming content from a commercial service to
which they subscribe. Due to this possible technological development, Fishers
44
Fisher, supra n. 1, at 214 ($2.389 billion would have to be raised for copyright
owners in movies, musical works and sound recordings).
45
Id. at 9.
46
Id. at 248.
47
Id. On the potential of this solution to comply with international copyright law
treaties, see infra Conflicts with a normal exploitation at p. 164 and Features and
benefits on p. 181.
48
See id. at 204 (stating that if a work was not registered, the use would be
lawful but uncompensated), at 247 (. . .if a copyright owner opted out of the system
entirely, releasing only an encrypted version of his or her recording. . .).
49
Lessig, supra n. 32, at 25455.
158
system would only serve in the interim period, to the extent that actual harm
is demonstrated.50
Jessica Litman differentiates between sharing and hoarding as the two
possible ways to exploit works on the Internet.51 By that, she means that right
holders can choose between letting their works be shared in P2P networks in
exchange for a blanket fee or levy/tax disbursed primarily to the musicians and
composers, or hoarding their works in exclusively exploited online ventures,
protected by DRM. Sharing would be the legal default rule.52 However, right
holders would be able to opt out of the levy system. To this end, they would
have to make their work available in a *.drm format capable of conveying
copyright management information, as defined in 17 USC 1202, that incorporates and facilitates digital rights management.53 If they had already
released their works in other formats, they still could after a 24-month grace
period before any withdrawal would take effect withdraw it from the
levy/tax system. In order to do so, however, the right holders would have to
recall copies of the work released in other formats and offer any consumers
who own authorized, commercial copies in a non-*.drm format the opportunity to exchange those copies for *.drm copies at no charge.54
Summing up, these concepts take the same starting point: compensation
without control is considered to be the best way to reap the fruits of the digital network technologies for authors and the general public alike.
Nevertheless, important differences can be observed. For example, not all
models afford the copyright owner the right to withhold his or her work from
the levy/tax system and to go for exclusivity in cyberspace instead. Even those
that do so, such as the models of Jessica Litman and William Fisher, advocate
sharing as the legal default. As will be shown in the following sections, these
differences are important when it comes to the question of compliance with
international copyright law. Finally, it should be noted that the mentioned
proposals are already influencing current political debates about copyright and
file sharing. Whereas content holders propose the application of software
filters that check files on the fly and order the users computer to terminate a
download if a files fingerprint matches that of a restricted song contained in
50
Lessig, supra n. 3, at 298, 301; see also Paul Goldstein (2003), Copyrights
Highway. From Gutenberg to the Celestial Jukebox, pp. 20203 (2nd edn.).
51
Jessica D. Litman (2004), Sharing and Stealing, 27 Hastings Comm. & Ent.
LJ 1, 3950.
52
Litman, supra n. 51, at 41. On the consequences of this solution for the
compliance of the proposal with international copyright law see infra Compliance
with international copyright law at p. 182.
53
Litman, supra n. 51, at 4648.
54
Id. at 48.
159
160
BC and the TRIPS Agreement. Only Art. 13 BC allows some flexibility with
regard to music.61 According to Jessica Litman, a model in which the right
holders can withdraw their work from the levy system would at least
arguably be compliant with treaty obligations under the BC and WIPO
treaties.62 She apparently doubts, however, whether her proposal for a levy/tax
system as the statutory default rule with an opt-out-procedure for right holders to be eligible for exclusive exploitation comports with the prohibition of
formalities for copyright protection under the BC.63 Finally, Neil Netanel
states that the levy he proposes would comport with Art. 13 TRIPS because it
would be limited to non-commercial uses and would provide a solution to the
practical implausibility of enforcing proprietary copyrights in the global P2P
arena.64 The following section will analyse which of these clearly differing
assessments is at least arguably correct.
Overview
All of the aforementioned proposals draw upon a limitation of or exception to
exclusive rights. With some differences in detail, the concepts permit noncommercial reproduction, distribution and public performance (streaming) of
a musical composition, sound recording, or motion picture via the Internet.65
Thus, they restrict both the reproduction right and the right of communication
to the public, which includes the right to make protected content available to
the public. Both rights are regulated as mandatory minimum rights in international copyright law.66
161
These exclusive rights are subject to the three-step test, which was adopted
in 1967 in Art. 9(2) BC67 and later in Art. 13 TRIPS,68 Art. 10 WCT69 and Art.
16(2) WIPO Performances and Phonograms Treaty (WPPT).70 It proclaims
that contracting parties may, in their national legislation, provide for limitations of or exceptions to the rights granted to authors
1.
2.
3.
67
Report on the Work of Main Committee I of the Conference in Stockholm
1967, reprinted in: WIPO, The Berne Convention for the Protection of Literary and
Artistic Works from 1886 to 1986 (Centenary) 19697 (1986) [hereinafter Report in
Stockholm 1967]. Art. 9(2) BC applies only to the reproduction right as regulated in
paragraph one of that article.
68
Art. 13 TRIPS is not confined to the rights newly introduced by the TRIPS
Agreement, but also applies to the rights provided for under the BC. See Panel Report,
United States-Section 110(5) of US Copyright Act, supra n. 14, at para. 6.80; Mihly
Ficsor (2002), How Much of What? The Three-Step Test and Its Application in Two
Recent WTO Dispute Settlement Cases, 192 Revue Internationale du Droit dAuteur
111, 153, 163; Sam Ricketson, WIPO Study on Limitations and Exceptions of
Copyright and Related Rights in the Digital Environment, Standing Committee on
Copyright and Related Rights, Ninth Session, Geneva, 23 to 27 June 2003, WIPO
Document SCCR/9/7 of 5 April 2003.
69
Art. 10(1) WCT covers the rights added by the WCT. Jrg Reinbothe and
Silke von Lewinski, The WIPO-Treaties 1996 Art. 10 WCT no. 26 . Art. 10(2) WCT 2
relates to the rights provided for in the BC. See WCT, Agreed Statement to Art. 10(2)
(It is also understood that Article 10(2) neither reduces nor extends the scope of
applicability of the limitations and exceptions permitted by the Berne Convention.);
Reinbothe and von Lewinski, at no. 6.
70
For the purpose of this chapter, I assume that the country that considers implementing one of the proposals is a member of or contracting party to the BC, the TRIPS
Agreement and the WIPO Copyright Treaties.
71
According to the preamble of the TRIPS Agreement, it is also taking into
account the need to promote effective and adequate protection of intellectual property
rights. In this respect, TRIPS parallels the WCT (to develop and maintain the protection of the rights of authors in their literary and artistic works in a manner as effective
and uniform as possible) and the BC (to protect, in as effective and uniform a manner
as possible, the rights of authors in their literary and artistic works).
162
provisions derive from Art. 9(2) BC.72 Moreover, this article does not attempt
a comprehensive interpretation of the three-step test according to the Vienna
Convention on the Law of Treaties.73 Rather, it summarizes how national
courts, the WTO Panel and legal literature construe the elements of the test. It
then applies these definitions to the concepts underpinning a levy/tax system
for P2P file sharing.
Interpretation of the Three-step Test
As regards the interpretation of the three-step test, it is undisputed that the
three steps have to be applied cumulatively74 and successively.75 In addition,
it is generally acknowledged that in construing the provisions of the three-step
test, one has to keep in mind the overall aim of the conventions: to provide for
adequate, balanced copyright protection.76
Certain special cases
The first condition established by the three-step test is that limitations of or
exceptions to exclusive rights may be introduced only in certain special cases.
As with all other elements of the test, divergent opinions exist as to what this
requirement means in detail. Some argue that a restriction in national law must
be clearly defined and should be narrow in its scope.77 The scope of the excep72
With regard to Art. 13 TRIPS, see Art. 2(2), 9(1) TRIPS and Daniel Gervais
(2nd ed. 2003), The TRIPS Agreement: Drafting History and Analysis 2.124; Panel
Report, United States-Section 110(5) of the US Copyright Act, supra n. 14, at para.
6.66; Ginsburg, supra n. 12, at 35; Senftleben, supra n. 56, at 99 et seq. But see
Gervais, The TRIPs Agreement, at 2.11.
73
See Panel Report, United States-Section 110(5) of the US Copyright Act,
supra n. 14, at para. 6.4346; Sam Ricketson (1987), The Berne Convention for the
Protection of Literary and Artistic Works: 18861986, pp. 13444; Ricketson, supra n.
68, at 59; Senftleben, supra n. 56, at 99114.
74
Failure to comply with any one of the three conditions results in the limitation/exception being disallowed. See Panel Report, United States-Section 110(5) of the
US Copyright Act, supra n. 14, at para. 6.74, 6.97; Reinbothe and von Lewinski, supra
n. 69, Art. 10 WCT no. 14.
75
See the records of the WCT negotiations, reproduced in Mihly Ficsor (2002),
The Law of Copyright and the Internet: the 1996 WIPO Treaties, Their Interpretation and
Implementation 5.134; Ficsor, supra n. 68, at 12021; Ginsburg, supra n. 12, at 4041.
76
With regard to the BC see Ricketson, supra n. 73, at 4748 (a pure maximalist view is mistaken); Ficsor, supra n. 75, 5.068. Regarding Art. 7 and 8 TRIPS
see Panel Report, Canada-Patent Protection of Pharmaceutical Products, supra n. 14,
at para. 7.26. Regarding the WCT see Reinbothe & von Lewinski, supra n. 69, Art. 10
WCT no. 7.
77
Panel Report, United States-Section 110(5) of the US Copyright Act, supra n.
14, at para. 6.112; Ricketson, supra n. 731, at 482; Ficsor, supra n. 68, at 129, 227;
163
164
regard to P2P networks is clearly defined and can easily be distinguished from
impermissible uses. For example, posting a work on a website or running a
P2P dark net where users have access only on a subscription basis would not
be privileged, because these uses have nothing to do with P2P technology
(posting a work on a web site) or are made for commercial purposes (running
a dark net). Second, advocates of non-voluntary license regimes raise several
justifications: namely, their concepts would preserve the promising advantages of global digital networks for instant and global dissemination of knowledge, especially for those works that are not adequately exploited and offered
by the right holder.85 Third, the quantitative approach taken by the WTO
Panel misconceives the scope of the limitation/exception and its consequences, on the basis that the proprietary exploitation of the work in general
must be analysed under the second step, not the first.86
Conflict with a normal exploitation
Proceeding to step two, the proposals must not conflict with a normal exploitation of the work. This is probably the element of the three-step test that raises
the most doubts regarding the scope of application and its effect on national
copyright legislation.
First, it is of utmost importance to note that, according to a nearly
uniformly accepted understanding based on the wording and structure of the
test, a non-voluntary license may only be introduced in national law if it clears
this hurdle. In particular, the implementation of a levy cannot cure a conflict
of the underlying limitation/exception with the second step, even if it compensates for the losses of the copyright owner. This aspect of compensation is
relevant only with regard to step three.87
85
On the assets of the proposals see Lessig, supra n. 3, at 29697. But see
Ricketson, supra n. 68, at 75 (unqualified assertion of public interest is not enough);
similarly Senftleben, supra n. 56, at 162 (with regard to digital private copying).
86
Senftleben, supra n. 56, at 140144.
87
Report in Stockholm 1967, supra n. 67, at 197 (the sequence would afford a
more logical order for the interpretation of the rule); Panel Report, United StatesSection 110(5) of the US Copyright Act, supra n. 14, para. 6.734; Ginsburg, supra n.
12, at 4553; Claude Masouy (1978), Guide to the Berne Convention for the
Protection of Literary and Artistic Works (Paris Act, 1971), pp. 5556; Ricketson,
supra n. 73, at 483485; Ricketson, supra n. 68, at 27; Henri Desbois et al. (1976), Les
Conventions Internationales du Droit dAuteur et des Droit Voisins, para. 173; Ficsor,
supra n. 75, at 5.58; Senftleben, supra n. 56, at 1301; Contra Geiger, supra n. 35, at
para. 418420; Christophe Geiger (2005), Comment, 36 International Review of
Intellectual Property and Competition Law (IIC) 151, 157 (proposing to read the threestep test backwards and to start with the third step in order to accomplish a flexible,
balanced system).
165
166
pay-per-use basis, it is argued that market failure considerations and decreasing transaction costs cannot be the sole line of argument. Otherwise, generally
accepted restrictions for, say, criticism, parody, or scholarship could be argued
to contravene step two.96
Applying these definitions to the proposals raises severe doubts regarding
their compatibility with this step of the three-step test. This is because the uses
covered by the proposed non-voluntary license, that is, copying and distributing content online by way of up- and downloads or streaming, are a source of
income today and will probably become even more important in the future.
Right holders are increasingly establishing commercial platforms to offer their
content for download or streaming.97 Assuming that a complete shift to
commercial online distribution by way of streaming is plausible, at least for
music and perhaps motion pictures, even Senftlebens restrictive interpretation, according to which a significant effect on the overall commercialization
of the work is necessary, to run afoul of this step would arguably assume a
conflict. It thus appears non-voluntary licenses covering non-commercial file
sharing can hardly be considered to be in line with the second criterion of the
three-step test.98
This conclusion, however, does not exhaust the problem as the aforementioned application of the three-step test relies upon a new type of protection
and factual exclusivity that Stefan Bechtold has called copyright cast in silicon99 DRM systems. This technology enables right holders to launch
commercial services in the digital network environment. With the advent of
technological protection measures, the copyright owner not only enjoys exclusivity based on the rights granted to him or her in national and international
copyright law, but DRM systems also make it possible to establish an additional, factual exclusivity supplemented with legal protection against the
circumvention of those technological measures.100
As already indicated, contracting parties of the WIPO Copyright Treaties
are obligated to provide legal protection of technological measures and rights
management information systems. Are the tax levy proposals in accordance
96
97
98
167
with these international requirements? And how does this legal protection
relate to the specifications of the three-step test?
Regarding rights management information, most of the proposals actually
draw upon fingerprinting and watermarking technologies. They do so in
order to monitor the ongoing uses in P2P networks for determining the shares
of each right holder. The establishment of a levy/tax system thus benefits from,
and relies upon, the mandatory protection of rights management information
systems according to Art. 12 WCT. A violation of this treaty obligation is not
apparent.
Much more problematic in this context is the mandatory protection of technological measures required by Art. 11 WCT. A complete prohibition of technological measures in national law would obviously be in conflict with this
requirement. However, none of the proposals discussed in this article suggests
that.
Neil Netanels Noncommercial Use Levy, however, rests upon the idea that
all works are covered by the limitation/exception to copyright and are thus
lawfully available in P2P networks. This premise can only be fulfilled if right
holders do not have the opportunity to withhold their works from this system.
Consequently, Netanels proposal suggests that right holders would not be entitled to employ technological DRM controls to block the privileged uses or, at the
very least, it would be legal for users to circumvent DRM controls and for suppliers to distribute circumvention tools needed to engage in privileged uses.101
Would such a limitation of the legal protection of technological protection
measures be in accordance with the WIPO copyright treaties? This raises the very
fundamental question of how this additional protection layer for copyright,102 as
regulated in Art. 11 WCT, relates to the three-step test (Art. 10 WCT), which
historically corresponded solely to exclusive rights granted by law.
As both provisions are regulated in the same treaty, they must not be
construed separately. Adopting this view, it is certainly in accordance with this
treaty to provide for narrow limitations/exceptions in line with Art. 10 WCT
and to restrict the legal protection of technological measures to the remaining
101
Netanel, supra n. 23, at 40. Sobel does not address this question expressly, but
it seems that his model is meant to comprise all copyrighted works and that it implies
that works can be downloaded, which would also require a prohibition of certain
restrictive technologies, e.g. those that facilitate pay-per-use models. See Sobel, supra
n. 30, at 68393.
102
See Chamberlain Group, Inc. v Skylink Techs., Inc., 381 F.3d 1178, 1192,
1202 (Fed. Cir. 2004) (holding that 17 USC 1201 et seq. do not establish a new,
highly protective alternative regime for copyrighted works and a new property right,
but instead prohibit forms of access that bear a reasonable relationship to the protections that the Copyright Act otherwise affords as an additional protection layer).
168
103
Ficsor, supra n. 75, at C11.10. This is the approach of the DMCA that gives
users a right to hack, but only under very restricted circumstances. See 17 USC
1201(d)-(j).
104
For example, critics of Michael Moore considered making a point-by-point
rebuttal of his movie Fahrenheit 9/11.
105
Supra Conflict with a normal exploitation at p. 164.
106
See Koelman, supra n. 91, at 7.
169
vention is legal if done to engage in privileged uses, for example, noncommercial file sharing) or even a prohibition of technological measures that
restrict these permitted uses is not in line with the three-step test and the
mandatory protection of technological measures.
This result, however, does not render all ideas for a levy/tax system covering non-commercial file sharing unlawful. Accounting for DRM systems
when applying the three-step test might result in an even greater freedom of
contracting parties to structure their national copyright law: the idea behind
this consideration is that right holders feature a new kind of exclusivity if they
implement DRM systems that eventually prevent the work from being used
without permission, for example, shared online. There are now two protection layers for a copyrightable work. The first one is exclusive rights under
copyright. The second one is the application of technological measures and the
legal rules against circumventing this factual exclusivity. The legislature can
limit both layers in parallel. For example, national copyright law can limit
exclusive rights and the legal protection of technological measures with regard
to quotations.
Both protection layers can, however, also be treated differently. By differently, I mean that national copyright law would, on the one hand, grant nearly
limitless anti-circumvention protection to DRM systems in order to enable
proprietary business models in cyberspace (exclusivity/hoarding). On the
other hand, a limitation/exception would allow non-commercial file sharing
under a levy/tax system, provided that the right owner does not implement
DRM. The copyright owner would thus be free to choose which kind of protection to adopt. With that freedom to choose, exclusivity as the fundamental
feature of current international copyright law is not restricted by a statutory
limitation/exception imposed by national law, but voluntarily by the right
holder. This is the basic notion of the bipolar copyright system and the reason
why this approach if implemented in national copyright law would not be
a violation of the three-step test or the obligation to protect technological
measures.
One nevertheless has to consider some possible counter-arguments in view
of international copyright law. Article 31(3)(b) of the Vienna Convention on
the Law of Treaties proclaims that there shall be taken into account, together
with the context . . . any subsequent practice in the application of the treaty
which establishes the agreement of the parties regarding its interpretation. An
agreement of the contracting parties regarding the permissibility of a bipolar
system cannot yet be observed. Broad non-voluntary licenses have, until now,
only been accepted to the extent that the exercise of exclusive rights is practically impossible (as in the case of private copying in the analog world). They
have not been adopted in situations where the copyright owner simply refuses
to implement readily available enforcement mechanisms. In addition, legal
170
107
Panel Report, United States-Section 110(5) of the US Copyright Act, supra n.
14, para. 6.188.
108
This notion can be traced back to the digital dilemma stemming from digitization and the Internet. See supra Introduction at p. 148.
109
See Ficsor, supra n. 75, at C10.34; Sirinelli, supra n. 12, at 28; Ricketson,
supra n. 68, at 75; Netanel, supra n. 23, at 60 n. 199.
110
With regard to European copyright law see Alexander Peukert, Der
Schutzbereich des Urheberrechts und das Werk als ffentliches Gut. Insbesondere: Die
urheberrechtliche Relevanz des privaten Werkgenusses, in Reto M. Hilty and
Alexander Peukert (ed.)(2004), Interessenausgleich im Urheberrecht p. 11, 25 et seq.
(explaining how the copyright directive expanded exclusivity to listening, reading, and
watching a work even if the consumer does not acquire a copy of the work).
171
approach lets one expect that a work is technologically shielded from file sharing. This approach is also fruitful with regard to the interpretation of the WCT.
A contracting party providing for protection beyond the obligations established by Art. 11 WCT regarding technological measures (because circumvention is also prohibited if the intended uses fall under a limitation/exception to
copyright) may draw upon a more flexible interpretation of Art. 10 WCT
regarding the three-step test, as opposed to a contracting party that seeks
narrow limitations to/exceptions from both the legal and the technological
protection layer.
Finally, the three-step test is not geared towards single copyright owners
but instead addresses national legislatures. Right holders have always been
free to decide to what extent they want to benefit from the exclusivity granted
by law. This freedom is exactly where the bipolar copyright system begins.
Right holders may opt for exclusivity and individual licensing (hoarding),
but under the bipolar copyright system, they have an additional option: they
would also be able to earn a levy/tax share by accepting certain privileges of
users, in particular, the non-commercial use of their work in P2P file sharing
systems.111 Seen from this perspective, the bipolar copyright system is nothing more than an additional compensation mechanism beyond what is available today. At present, right holders may try to recoup their investment by
individually licensing the use of their work. File sharing is copyright infringement. It is not compensated for if the right holder does not enforce exclusive
rights in difficult and expensive litigation in every single case. Under the bipolar copyright system, these uncompensated uses would potentially fall under
the levy/tax system and would therefore generate income. It would be up to
the right holder to decide which compensation mechanism promises more
revenues. Therefore, the levy/tax system essentially is not a non-voluntary
license, but instead a voluntary option.112
It has to be stressed, however, that this discussion relates to the second step
of the three-step test: the bipolar copyright system does not conflict with
normal exploitation of the work. The limitation/exception to exclusive rights
under the levy/tax system still has to meet the requirements of the first and
third steps. This way, the legal protection layer copyright may not be
removed completely. A bipolar copyright system would have to be limited to
certain special cases (first step) and would have to be modelled in a way not
to prejudice the legitimate interests of the author (third step).
111
172
In summary, the bipolar system rests upon the two pillars, which represent the
layers of todays copyright protection. One pillar is the law that prohibits the
circumvention of technological protection measures in order to establish exclusivity in the digital realm. The other pillar is a limitation/exception that permits
digital uses (for example, non-commercial file sharing) in the case of the right
holder opting out of the silicon copyright. The bipolar model (in accordance
with the three-step test) is thus a levy/tax for non-commercial file sharing as an
alternative to exclusivity based on law and technology. This follows the
approach of William Fisher and Jessica Litman. According to their concepts, the
copyright owner is free to choose hoarding instead of sharing.113
Fischer and Litman suggest the levy/tax system as the statutory default rule,
thereby requiring right holders to opt out of the levy/tax system if they prefer
proprietary exploitation. The pros and cons of this alternative and its compliance with international copyright law treaties will be discussed later on in this
chapter.
Unreasonable prejudice to the legitimate interests of the right holder
Before these details of the bipolar copyright system can be addressed, one
must still consider the third element of the three-step test. This element sets
out that the limitation/exception must not unreasonably prejudice the legitimate interests of the right holder.
Only if a non-voluntary license overcomes the first two hurdles must this
last condition be assessed. It establishes a flexible standard of reasonableness,
balancing the interests of right holders versus that of the beneficiaries of the
restriction to exclusive rights.114 It calls for protection of interests that are
justifiable in the sense that they are supported by relevant public policies or
other social norms.115 The crucial questions are whether the interests at stake
are legitimate, and at what point the degree or level of prejudice to the interests of the right holder may be considered unreasonable.116 The payment of
remuneration under a non-voluntary license may prevent the prejudice from
reaching an unreasonable level.117
113
Litman, supra n. 51, at 3950 (sharing or hoarding); Fisher, supra n. 1, at
248. For a more detailed discussion of the bipolar system, see infra How a bipolar
copyright system would function at p. 175.
114
Ficsor, supra n. 68, at 145; Ricketson, supra n. 68, at 27; Ginsburg, supra n.
12, at 57; Senftleben, supra n. 56, at 21044; Gervais, supra n. 12, at 1920.
115
Panel Report, Canada-Patent Protection of Pharmaceutical Products, supra
n. 14, at para. 7.69; Gervais, supra n. 12, at 1920.
116
Senftleben, supra n. 56, at 22641.
117
German Federal Supreme Court, Gewerblicher Rechtsschutz und
Urheberrecht (GRUR) 963, 967 (2002); Reinbothe and von Lewinski, supra n. 69, Art.
10 WCT no. 23; Ginsburg, supra n. 12, at 53; Senftleben, supra n. 56, at 23741.
173
Deciding whether a levy/tax system covering P2P networks on a noncommercial scale presents an unreasonable prejudice to the right holders
interest depends, to a large extent, upon the architecture of the system. It
would obviously present a prejudice to right holders if they were not allowed
to technologically prevent file sharing, or if circumvention for the purpose of
file sharing were not prohibited.118
Relying on technological measures to exploit works online is a legitimate
interest of right holders,119 as that is just what Arts. 8, 10 and 11 WCT are
meant to facilitate. Whether such an encroachment upon authors rights is seen
as unreasonable depends on whether national legislatures find that the public
interests benefited by this regime are equal to the interests of authors,120 and
whether the tax/levy actually compensates for the losses. In that regard, it must
be observed that the third requirement remains open-ended, leaving it for the
national legislature to strike the balance in particular cases that have passed
the first and second step.121 Considering the positive effects of a levy/tax
system for the dissemination of knowledge as well as for the compensation of
the accruing uses, it could certainly be argued that it would be a justified, and
not unreasonable prejudice to the interests of the right holders. However, the
problem with a proposal that restricts both protection layers (copyright and
DRM plus anti-circumvention provisions) with regard to file sharing is that it
does not fulfil the requirements of the second step. Neil Netanels concept,
therefore, would not survive for consideration of the third step.
As explained above, a tax or levy system as an optional alternative to exclusive exploitation in cyberspace, the bipolar system, does not run afoul of the
first two steps of the three-step test. Regarding the third step, the beneficial
effects of not outlawing P2P technology, improving the dissemination of
knowledge and guaranteeing compensation for authors, justifies the adoption
of this system. The bipolar system does not limit exclusivity as such; it simply
118
This reflects Neil Netanels proposal. See supra Non-voluntary licenses
regarding P2P file sharing at p. 154.
119
In this regard, it is important to determine whether only the interests of the
author count or also the interests of intermediaries as derivative right holders; see
Reinbothe and von Lewinski, supra n. 69, Art. 10 WCT no. 8 (safeguarding of investments of intermediaries is an aspect to be considered in applying Art. 10 WCT);
Senftleben, supra n. 56, at 21621.
120
The dominant opinion prioritizes authors rights v users interests; see e.g.
Guibault, supra n. 36, at 90110; Reinbothe and von Lewinski, supra n. 69, Art. 10
WCT no. 8 (referring to the preamble of the WCT that speaks of rights of authors but
only of the public interest); contra Geiger, supra n. 35, paras. 22526 (regarding limitations justified by fundamental rights); CCH Canadian Ltd. v Law Society of Upper
Canada, 2004 SCC 13 (Supreme Court of Canada 2004), paras. 12, 48 (finding that fair
dealing is a right of users).
121
Ricketson, supra n. 68, at 26.
174
offers right holders an additional business model to generate income from uses
of their work in cyberspace. The mere necessity of making a choice between
the two alternatives cannot be said to be a prejudice to the legitimate interests of right holders because it is nothing other than an everyday business decision. This illuminates the fact that limiting only one protection layer
(copyright) to a mere remuneration right and leaving the other layer (DRM
plus anti-circumvention rules) untouched is consistent with international copyright law. In any event, the levy/tax revenue must be sufficiently high to at
least arguably substitute for a potential exclusive exploitation on the basis of
DRM in cyberspace.122
Agreed Statement to Article 10 WCT
The previous analysis has revealed that it is more than doubtful whether, for
example, Neil Netanels noncommercial use levy for P2P file sharing fulfils
the obligations laid down in international copyright law because this levy also
denies the right holder the option of individual licensing using DRM. A different view could be derived from the Agreed Statements regarding Art. 10
WCT,123 which reads:
It is understood that the provisions of Article 10 permit Contracting Parties to carry
forward and appropriately extend into the digital environment limitations and
exceptions in their national laws, which have been considered acceptable under the
Berne Convention. Similarly, these provisions should be understood to permit
Contracting Parties to devise new exceptions and limitations that are appropriate in
the digital network environment.124
The delegations that proposed this statement wanted to express concerns that
the three-step test might become a straightjacket for adopting limitations and
exceptions in the digital environment.125 It is worth noticing the differences
between the two sentences: whereas the first sentence corresponds to already
existing restrictions and the digital environment in general, the second
sentence, dealing with new exceptions/limitations, relates to the digital
network environment and thus to the Internet context addressed by this article.
122
For a discussion of the amount of tax/levy due, see Fisher, supra n. 1, at
20515; Netanel, supra n. 23, at 4452.
123
Since it applies to both paragraphs of Art. 10 WCT, it not only relates to the
rights provided for in the WCT (especially the right of communication to the public,
Art. 8 WCT), but also to the rights granted under the BC (the reproduction right).
124
For a discussion on the relevance of the Agreed Statements with regard to the
application of the three-step test in general, see Ricketson, supra n. 68, at 62.
125
For the remarks of the delegations of the USA, Denmark, India, and the
United Kingdom, see Ficsor, supra n. 75, at 5.137.
175
Does this statement thus constitute a charter for contracting parties to devise
new exceptions and limitations in the digital network environment without
taking account of the three-step test?
For a number of reasons, the answer has to be in the negative. One of the
main goals of the WCT was to establish a new, exclusive Internet right as a
minimum right in international law. It would be inconsistent with this purpose
to read the agreed statement as giving contracting parties discretion to restrict
exclusivity in the digital network environment as they see fit. Had the
contracting parties wanted to exclude online uses from the three-step test, they
would have done so in the treaty. Finally, since the reproduction right is also
subject to Art. 13 TRIPS, which does not contain a similar statement, this
interpretation would produce a severe discrepancy in international copyright
law in general. Thus, the statement has to be understood, not as a broad
enabling clause, but as a clarification that exceptions and limitations may
indeed be adopted in the digital network environment126 and that they still are
subject to the three-step test.127
176
works into the public domain without significantly diminishing the incentive
of authors to create new works. A similar result could perhaps be achieved by
requiring registration for the renewal of the copyright term.130
The problem with these proposals is and that brings us back to the aim of
this paper that they require the amendment or abrogation of international
copyright treaties.131 It has been pointed out that these steps are extremely
difficult to achieve or simply unrealistic on a political level.132 It is therefore
reasonable to seek a solution that is superior to the logjam we have right now
without conflicting with Berne, TRIPS or the WIPO Treaties. One proposal
that fulfils this fundamental requirement and looks for middle ground in the
battle over copyright in the digital network environment is a streamlined
enforcement mechanism as outlined by Lemley and Reese.133 Another option
would be a voluntary collective management system as suggested by the EFF
and others.134 However, as long as these solutions are not adopted and have
therefore not yet proven that they actually solve the problems they are
supposed to address, it is worth asking what a bipolar copyright system would
look like in spite of its complexity.
Switching Between Individual Licensing and the Levy System
Does the choice make sense?
The most important feature of the bipolar system is that the right holder may
freely choose between exclusive, proprietary exploitation on the basis of DRM
(hoarding) or participating in the levy/tax system (sharing) as regards noncommercial file sharing. One of the advantages of this system is that the decision must be made for every single subject matter by the copyright owner
130
See Lessig, supra n. 32, at 25152; William M. Landes and Richard A. Posner
(2003), Indefinitely Renewable Copyright, 70 U. Chi. L. Rev. 471, 476; Epstein,
supra n. 1, at 3337; Public Domain Enhancement Act, H.R. 2601 108th Cong. (2003),
available at http://thomas.loc.gov/cgi-bin/query/z?c108:H.R.2601:.
131
For the duration of copyright, see Art. 7 BC, Art. 12 TRIPS. For the formalities of copyright, see Art. 5(2) BC.
132
See supra Introduction at p. 149. In the end, national lawmakers have to
make a choice between negotiations on a political level to amend international copyright law, and systems like the bipolar copyright system that do not require changes of
international law. Complexity is involved in either strategy. It only relates to different
aspects, that is, politics on the one hand and the legal and technological architecture of
the approach in line with current international copyright law on the other (be it a bipolar copyright system or a streamlined enforcement mechanism).
133
Supra n. 30. The authors also think it possible that their proposed system
could be part of a levy system, be it on an opt-in or opt-out basis; id. at 1424.
134
See supra Non-voluntary licenses regarding P2P file sharing at p. 154.
177
135
136
Supra n. 30.
The distinction between popular works and less popular works also plays a
role in the discussion on the optimal level of DRM protection. See Jeevan Jaisingh
(2004), Piracy on File Sharing Networks: Strategies for Recording Companies, available at http://ssrn.com/abstract=567681, 19 (stating that protecting the latest album by
Michael Jackson or the latest Lord of the Rings (movies and artists which already do,
or are more likely to create a buzz) makes more sense than protecting an album,
which is less likely to be popular.).
137
See MGM, 380 F.3d 1154, 1161 (9th Cir. 2004) (Indeed, the record indicates
that that thousands of other musical groups have authorized free distribution of their
music through the Internet.); MGM, 125 S.Ct. 2772 (Some musical performers . . .
have gained new audiences by distributing their copyrighted works for free across peerto-peer networks. . .).
138
See Lessig, supra n. 32, at 13234.
178
139
This is the approach of the so-called Potato System, which was developed by
the German Company 4FO AG together with the Fraunhofer-Institute for Digital
Media Technology IDMT in Ilmenau, Germany; see http://www.potatosystem.com/
info/eng/index.html.
140
The copyright owner may still try to sell copies of the work. While commercial online ventures will face significant competitive pressure from the freely available
versions in P2P networks, CDs and other offline mediums may still be successfully
offered.
141
There is no considerable risk that consumers will willfully abstain from
179
to require direct payment for such uses, and to still receive revenue is an alternative business model not available today.
Moreover, the fact that this switch to the levy/tax system will often take
place after a certain period of proprietary exploitation reflects current criticisms of the copyright term. In many jurisdictions, copyright currently lasts 70
years post mortem auctoris.142 It is rightly argued that such a long copyright
term, compared to a copyright term of 50 years p.m.a. or even shorter terms,
does not generate economic incentives meaningful for initial creativity.143 As
Justice Breyer put it in his dissenting opinion in Eldred v Ashcroft, no potential author can reasonably believe that he has more than a tiny chance of writing a classic that will survive commercially long enough for the copyright
extension to matter. After all, if, after 55 to 75 years, only 2 per cent of all
copyrights retain commercial value, the percentage surviving after 75 years or
more (a typical pre-extension copyright term) must be far smaller.144 The
bipolar copyright system can be understood as a flexible answer to that problem. Releasing works into P2P networks after an initial exploitation in proprietary systems gives users nearly as much freedom as with works in the public
domain. In addition, to provide for a significantly shorter copyright term
would again require the amendment of international copyright law. Finally, no
statutory modification of the copyright term would ever make it possible to
consider the commercial life cycle of each work individually. This, however,
is just what the bipolar copyright system does.
At first glance, it seems that the second variant of the switch-over scenario,
to switch from the levy/tax system to the proprietary system, is not likely to be
of practical relevance. After all, digital files of the unportected work are available in P2P networks. Given the current state of the art, it would hardly be
possible to prevent further use of these files technologically. The Grokster
decision of the Ninth Circuit Court, however, offers a telling example that
purchasing or licensing copies of newly released songs or movies because they hope
that these works will soon be available in P2P networks, as cultural works exert considerable attraction on consumers if they are admittedly, for a limited period of time a
must-have. Think, for example, of number one hits or movies that consumers simply
have to know in order to be able to take part in everyday conversation. This notion
relates particularly to younger consumers.
142
See, for example, 17 USC 302(a); Art. 1(1) Council Directive 93/98, 1993
OJ (L290) 9-13 (EC).
143
See Eldred v Ashcroft, 123 S.Ct. 769, 79293 (Stevens, J., dissenting), 808
(Breyer, J., dissenting) (2003).
144
Id.; Lessig, supra n. 32, at 29294; for a European perspective on Eldred see
Reto M. Hilty (2003), Eldred v Ashcroft: Die Schutzfrist im Urheberrecht eine
Diskussion, die auch Europer interessieren sollte, Gewerblicher Rechtsschutz und
Urheberrecht International (GRUR Int.), 201204.
180
teaches the opposite. Explaining why the P2P software at issue was capable
of substantial or commercially significant noninfringing uses, the court
states:145
One striking example provided by the Software Distributors is the popular band
Wilco, whose record company had declined to release one of its albums on the basis
that it had no commercial potential. Wilco repurchased the work from the record
company and made the album available for free downloading, both from its own
website and through the software user networks. The result sparked widespread
interest and, as a result, Wilco received another recording contract.
145
MGM, 380 F.3d 1154, 1161 (9th Cir. 2004). The Supreme Court did not refer
to this example expressly but stated that some musical performers . . . have gained
new audiences by distributing their copyrighted works for free across peer-to-peer
networks . . .; MGM, 125 S.Ct. 2764, 2772 (2005). Justice Ginsburg declared that
there has been no finding of any fair use and little beyond anecdotal evidence of
noninfringing uses; id. at 2785.
146
See Lemley and Reese, supra n. 30.
147
Litman, supra n. 51, at 49.
148
One could even consider allocating, for a certain period of time, a fraction of
the money due under the levy/tax system to the copyright owner after the work has
been withdrawn to account for the ongoing uses. This option, however, has severe legal
pitfalls. In the end, the uses are unlawful. After the work has been withdrawn, uploads
and downloads infringe the copyright in the work. They can be prevented by exercising exclusive rights. If the copyright owner fails to do so, it does not seem justified to
nevertheless assign his or her shares of the levy/tax revenue.
181
These examples show that both systems will be used for different classes of
works. While some works will be exploited (often for a limited time only) in
commercial online ventures, others will from the time of first publication be
available for non-commercial file sharing in P2P networks. The question
remains, however, as to which system should or must form the legal default.
Two alternatives are imaginable. In the first, the levy/tax system is the legal
default and the copyright owner must opt out of it. This is the variant proposed
by Jessica Litman and William Fisher. Alternatively, exclusivity is the rule and
the right holder may deliberately opt into the levy/tax system. The following
section addresses both alternatives, again emphasizing the question of whether
both approaches are in line with international copyright law.
Opting Out of the Levy/tax System
Features and benefits
The first alternative to be considered here is the opt-out model. According to
the suggestions of Jessica Litman and William Fisher, the levy/tax system
should be the legal default.149 Any work still under copyright and every newly
published work would fall under the new limitation from or exception to
exclusive rights, and would at the same time be eligible for shares of the
levy/tax, unless the right holder opted for exclusivity on the basis of DRM.
With regard to new works, Litman proposes a notice-based opt out mechanism. In order to inform consumers that a particular work does not fall under
the levy/tax system, the copyright owners would have to release the work in a
*.drm format.150 The right holders would lose any claims under the levy
system. Additionally, they would have to take affirmative steps to exclude
their work from the network and enable consumers to quickly and painlessly
ascertain that those works may not lawfully be shared.151 For works that have
already been released in another, free, format, Litman would make it even
more burdensome to withdraw a work from sharing.152 Without explaining
149
150
151
152
182
183
184
right of communication to the public would be limited with regard to noncommercial file sharing unless the right holder fulfills certain requirements.
The three-step test and the prohibition of formalities are closely related to
each other. If exclusivity has to be the default under the three-step test, the optout mechanism can well be said to act as a formality requirement. If not, the
right holder would in principle161 enjoy automatic protection under the
levy/tax system without further conditions or formalities. In this latter case,
Art. 5(2) BC would not be violated by this solution. To explain this distinction,
one must look to the general goals of the convention and the relevant provisions, because there is no precedent for an opt-out mechanism under a bipolar
copyright system. The idea of two layers of exclusivity that are treated differently was not known in 1971, the year of the last amendment of the Berne
Convention.
To begin with, it can certainly be argued that the necessary acts for opting
out of the levy/tax system are formalities under Art. 5(2) BC. Jessica Litman
suggests that the work would have to be published in a certain *.drm format
and that the right holder would have to take care that consumers are informed
about this choice. One could alternatively imagine a notice with the competent
authority that the work shall not be lawfully available for file sharing.162 Both
requirements are state-required, formal preconditions, similar to the notice and
registration system under former US copyright law, which was one of the
major obstacles to the US joining the Berne Convention.163 This is obvious in
the case that a declaration or registration is necessary.164 It also holds true for
the requirement to use a digital format (*.drm). While one might question
whether this requirement is a formality, it certainly can be said to impose a
condition in a more general sense that has to be complied with in order to
ensure that the work does not fall under the limitation/exception for noncommercial file sharing.
Originally, Art. 2(2) of the 1886 Berne Act referred to formalities and
conditions. Conditions meant material requirements such as providing a
161
It has to be noted that naturally only those right holders can receive a share of
the incurred levy/tax who register their work with the competent authority that distributes the money.
162
See Fisher, supra n. 1, at 242 (discussing an opt-out mechanism as regards the
preparation of derivative works).
163
See 17 USC 401(a); Nordemann et al., supra n. 160, Art. 5 BC no. 7.
164
Other formalities are the obligation to affix a copyright symbol and to make
a legal deposit of money or a copy of the work under penalty of losing rights. See
Daniel Gervais (2003), Application of an Extended Collective Licensing Regime in
Canada: Principles and Issues Related to Implementation, Study Prepared for the
Department of Canadian Heritage, available at http://www.canadianheritage.gc.ca/
progs/ac-ca/progs/pda-cpb/pubs/regime/regime_e.pdf, 19; Ricketson, supra n. 73, at
5.83; Nordemann et al., supra n. 160, Art. 5 BC no. 7.
185
translation of the work in the language of the country where protection was
sought.165 When the need to comply with conditions and formalities was abolished at the 1908 Berlin Conference, the term conditions in the new provision 4(2) was deleted as well. The documents of the conference, however,
show that the delegations understood the new wording formalities as covering both the conditions and formalities referred to in the 1886 Act.166 Thus,
the requirement to use a certain format for publication in order to enjoy exclusivity in cyberspace is also a formality under Art. 5(2) BC.167
With this insight, however, the interpretation of Art. 5(2) BC is not
complete. The second element of this provision is that the enjoyment or exercise of the right of reproduction and the right of communication to the public
as minimum rights under the named conventions be subject to the formality.
The necessity of addressing this element separately becomes obvious in light
of a statement at the Diplomatic Conference of 1884 that explains the meaning and reach of the provision. During the discussion, one of the German delegates put forward an interpretation that was approved by the Conference and
was reproduced verbatim in the Conference records. According to the statement of Dr. Meyer, the words formalities and conditions comprise everything which must be complied with in order to ensure that the rights of the
author with regard to his work may come into existence [in German:
Voraussetzungen], while the effects and consequences of protection [in
German: Wirkungen], in particular the extent of that protection, should
remain subordinated to the principle of treatment equal with nationals.168 As
was already shown, the current version of Art. 5(2) BC can be traced back to
Art. 2(2) of the 1886 Act.169 Hence, the distinction between prohibited formalities relating to the genesis of the right, and formalities that concern only the
scope of copyright is still valid for the interpretation of the provision.170
Adopting this reading of Art. 5(2) BC, it could be argued that the opt-out
mechanism establishes only a formality requirement as regards the scope of
copyright, in Dr. Meyers words the consequences of protection, but not its
genesis. As a result, these formalities would not fall under Art. 5(2) BC and
would therefore not conflict with this international obligation. For example, it
165
Ernst Rthlisberger (1906), Die Berner bereinkunft zum Schutze von Werken
der Literatur und Kunst und die Zusatzabkommen, p. 101.
166
Ricketson, supra n. 73, at 5.83.
167
The same holds true for other requirements Litman proposes. See Litman,
supra n. 51, at 48.
168
Ricketson, supra n.73, at 5.82.
169
See supra Compliance with international copyright law at p. 182.
170
See Ricketson, supra n. 73, at 5.83; Masouy, supra n. 87, at 35; Nordemann
et al., supra n. 160, Art. 5 BC no. 7; see also Baum, supra n. 158, at 927 for further
references.
186
is held that Art. 5(2) BC does not apply171 to provisions in national copyright
law that grant a longer copyright term for pseudonymous works if the author
registers his or her true name in a register for authors172 or if the law provides
for a presumption in favour of the person who is designated as author on a
copy of the work.173 Similarly, the opt-out mechanism does not deprive the
author of copyright protection completely. Copyright still comes into existence
without any formalities. Only with regard to non-commercial file sharing is
the legal default not exclusivity, but a levy/tax system, which still generates
income for the author. True, copyright owners still have to register their work
with the competent authority in order to actually have the prospect of receiving a share of the accrued money. But this could be said to be a mere factual
necessity.174 It is not required by law. Basically, the protection under the
levy/tax system is afforded without any formalities.
Moreover, it has to be kept in mind that the bipolar copyright system is
generally admissible under the three-step test. A national copyright law establishing this model could thus be said to grant authors the minimum rights
under Berne. If this is true, both pillars of the bipolar system are valid default
rules. Art. 5(2) BC would only prohibit both layers of protection being
subjected to formalities. Therefore, if right holders opt for exclusivity, they
are, according to this view, only extending the scope of copyright protection,
just like authors of pseudonymous works who register their true names to
enjoy the full copyright term.
171
See Ricketson, supra n. 75, at 5.82; Rthlisberger, supra n. 165, at 108;
Baum, supra n. 158, at 928; Willy Hoffmann (1935), Die Berner Uebereinkunft zum
Schutze von Werken der Literatur und Kunst 92; Schnherr, supra n. 158, at 297.
172
See, e.g., Sec. 66(2) German CA.
173
See, e.g., Sec. 10(1) German CA: In the absence of proof to the contrary, the
person designated in the customary manner as the author on copies of a work which
has been published or on the original of a work of fine art shall be deemed the author
of the work; the same shall apply to a designation which is known as the authors pseudonym or the artists mark.
174
For a discussion on the contrary view and the duty of the competent authority
to search for authors who did not register, although their works are being shared, see
infra n. 183. It is furthermore interesting in this context that the extended collective
management of exclusive rights by collecting societies is said to be in line with Art. 5(2)
BC. Extended collective management of rights means that national copyright law entails
a presumption in favour of collecting societies. According to this presumption, all
authors whose works are actually used under the collective licensing scheme grant
rights, even if this is true only for a substantial number but not all authors. Without this
presumption, smaller collecting societies would not be able to offer a comprehensive
repertoire for users. Authors are therefore obliged to expressly object to this administration of their rights in order to regain control over the exercise of their exclusive rights.
See Gervais, supra n. 164, at 19; Gervais, supra n. 4, at 72.
187
Finally, the formalities proposed for opting out of the levy/tax system do
not relate to the exercise of the exclusive rights. With exercise, Art. 5(2) BC
refers to the enforcement of copyrights, that is, to the remedies available in the
case of an infringement. For example, the bringing of proceedings or the
award of damages must not be dependent on formalities or conditions.175 The
formalities at stake here do not centre on infringement and remedies, but
primarily on the enjoyment of rights. Additionally, the whole idea of a bipolar
copyright system strongly implies a choice to be made by the right holder. This
choice has to be expressed and registered in some form to give the public, or
at least the competent authority, notice about the status of the work. If exercise of rights were to cover this notification, even a system that starts from
exclusivity and provides for a voluntary opt-in mechanism as regards the
levy/tax system would not comply with Art. 5(2) BC. Even the requirement to
file written documents in order to institute an infringement proceeding would
run afoul of the Berne Convention. Obviously, this cannot be true. A formality requirement as to the exercise of rights has to impose additional obstacles
not necessarily inherent in the copyright system.
For the following reasons, however, these arguments in favour of an opt-out
mechanism as the default are unconvincing. First and most importantly, it has to
be restated that the bipolar copyright system is also subject to the three-step test.
The arguments above only help to avoid a conflict with the second step, that is,
the normal exploitation of the work in the digital network environment. The first
and third step still have to be observed. From this it follows that a bipolar copyright system has to be confined to certain special cases (non-commercial file
sharing), and that the levy or tax has to compensate the privileged uses in order
not to cause an unreasonable prejudice to the legitimate interests of the right
holder. If it is true that the three-step test applies, its primary purpose has to be
observed. This fundamental goal is to guarantee certain minimum exclusive
rights in works, and to confine the scope of limitations to or exceptions from
exclusive rights in national copyright law. The bipolar copyright system already
downgrades exclusivity to an alternative, on par with a mere right to remuneration under a levy/tax system. This right to remuneration relies on
limitations/exceptions to copyright, which would conflict with the normal
exploitation of the work if the copyright owner did not have the option to choose
exclusivity. A paradigm shift like this only conforms with the purpose of the
three-step test if exclusivity at least forms the statutory default rule.
Second, this consideration can be rested upon the evaluation of other cases
where the copyright owner is obliged to fulfil formalities in order to enjoy
exclusivity. One example can be found in the BC itself. Art. 10bis(1)(1) reads:
175
188
It shall be a matter for legislation in the countries of the Union to permit the reproduction by the press, the broadcasting or the communication to the public by wire
of articles published in newspapers or periodicals on current economic, political or
religious topics, and of broadcast works of the same character, in cases in which the
reproduction, broadcasting or such communication thereof is not expressly reserved
[emphasis added].
189
182
See Vienna Convention on the Law of Treaties, Art. 31(3)(b) May 23, 1969 n.
55 U.N.T.S.331.
183
In order to address this problem, the authority distributing the money would
have to check whether all works that are being used are registered and would have to
contact the respective right holders if this were not the case. This solution obviously
entails significant administrative costs that diminish the prospects of the whole system.
184
Litman, supra n. 51, at 46 n. 166.
185
See Art. 5(1) BC ([I]n countries of the Union other than the country of
origin); Ricketson, supra n. 73, at 5.81; Masouy, supra n. 87, at 5.6; von Lewinski,
supra n. 37, at 5 n. 13. This is the reason why 17 USC 411(a) limits registration as a
condition to instituting an infringement action to United States works. See Paul
Goldstein (2002), Copyright at 3.15 (2nd ed.).
190
system anyway. The opt-out model as such would lose its most important
advantage, that the levy/tax system presumptively covers all works available
in the network. Finally, it would be even more difficult to persuade the legislature to implement a general levy/tax up front if the amendment discriminates
against national authors as compared to foreigners.186
If the opt-out model is not in line with international copyright law and
admissible modifications of this concept do not seem reasonable as to their
consequences, it shows promise to turn ones attention to the legal and practical aspects of an opt-in model.
Opting in to the Levy/tax System
Features and benefits
Under the opt-in model, to get paid a share of the levy/tax based on the monitored use of the work in P2P file-sharing systems, the right holder has to register the work with the competent authority. So as long as the work has not been
registered and technologically tagged, use is unauthorized and thus infringes
on the authors rights.187 This means that exclusivity is the legal default just
as it is today. The levy/tax system would provide an additional business model,
available for those right holders who think that this mode of exploitation is
more attractive than individual licensing on the basis of DRM.
Obviously, this solution does not raise doubts as to whether it is in accordance with treaty obligations under Berne, TRIPS or the WCT. It does not
limit the enjoyment or exercise of exclusive rights by law. Moreover, these
rights come into existence without formalities or other conditions.
Accordingly, neither the guarantee of normal exploitation under the three-step
test188 nor the prohibition of formalities is affected. This concept only gives
the copyright owner an incentive to accept lawful non-commercial file sharing
by providing a distribution channel where compensation without control can
become a reality.
Contrary to the opt-out model, the questions relating to this approach are
not of a positivistic and legal, but of a practical nature: is it persuasive to
186
See Ricketson, supra n. 73, at 5.81 (explaining that the convention invariably
has a decisive effect on the content of the domestic laws of its members).
187
Fisher, supra n. 1, at 204, proposes a different solution. If the work is not
registered, it would be deemed to be dedicated to the public domain (Would each
creator be obliged to register his or her creations? No. Unlike cars, songs and films
could be unlicensed. Creators who wished for whatever reason to dedicate their products to the public domain could do so.).
188
Still, however, the first and third requirements of the three-step test have to be
observed.
191
189
For the EFF proposal, see supra Non-voluntary licenses regarding P2P file
sharing at p. 154.
190
See Fisher, supra n. 1, at 25758.
191
See Netanel, supra n. 23, at 3559. The levy/tax would have to be imposed on
all services and products offered in the respective country. Therefore, it would not
severely affect competition in the relevant markets because all manufacturers or suppliers of services would have to pay the levy/tax. It has to be admitted, however, that
newly developed substitutes would have to be covered quickly by the levy/tax.
192
contracting into liability rules192 obviously does not take place automatically. The government, however, cannot force right holders into liability rules,
since that would be incompatible with international copyright law. Instead, it
establishes a system for indirect compensation of non-commercial file sharing.
Whereas in the short run, not all works will be available for lawful file sharing, the fact that at least some will be will probably change consumers attitude towards the way works on the Internet can be legally accessed. This soft
pressure and change of consumer behaviour is likely to make the levy/tax
system ever more appealing for copyright owners.
That the levy/tax system may grow due to network effects, however, also
reveals important drawbacks of the opt-in model. The levy or tax has to be
imposed without the guarantee that all works will be lawfully available in P2P
networks. Works that promise particular commercial success will not likely be
registered, at least in the beginning. Thus, the ones who have to pay the
levy/tax, consumers and manufacturers of devices and suppliers of services
used for file sharing, will claim that they are being burdened while the public
benefit is uncertain. In fact, this value judgment will be at the core of the political discussion surrounding an opt-in model: is it justified to raise prices for
devices and services at the heart of the information and knowledge society in
order to establish an additional business model for the distribution of copyrighted content online?
As right holders retain their freedom to decide about the use of their work, it
will not be them, but manufacturers of devices and suppliers of services who
will primarily argue against the implementation of this proposal.193 The opt-in
model shifts the pressure away from copyright owners towards a party that
neither creates nor consumes content. This view, however, neglects the fact that
manufacturers and suppliers of services profit from unauthorized use of copyrighted works in P2P networks because they commercialize the very services
and devices necessary for file sharing. Thus, they cannot claim to be uninvolved.
To sum up, there are many good reasons for a bipolar opt-in model, even if
it is uncertain how many works will be lawfully available for non-commercial
file sharing in the end. Most importantly, it is the only model that brings a
levy/tax system in the digital network environment into line with international
copyright law.
192
See Robert P. Merges (1996), Contracting Into Liability Rules, 84 Cal. L.
Rev. 1293 (explaining why right holders will automatically establish systems like
collective licensing if individual licensing does not work).
193
Fisher, supra n. 1, at 242. This repudiation can also be observed in the course
of the discussion about the future of the limitation and the levy for private copying in
Germany; see e.g., Bernd Rohleder (2004), Fr eine zukunftsfhige Urhebervergtung,
Zeitschrift fr Urheber- und Medienrecht (ZUM), p. 1061 (proposing to abolish the
levy for digital private copies).
193
CONCLUSION
As long as P2P file-sharing technology is not declared illegal194 and is not
substituted by other technologies, it is here to stay. If copyright owners fail to
integrate this technology into business models to generate revenue from the
consumers use of copyrighted works (as in the case of the VCR195), the
discussion about alternatives to exclusive exploitation in cyberspace will
become ever more important. Proposals for tax or levy systems covering noncommercial file sharing are among the most promising approaches to take
advantage of this technology for authors and society at large because this
model secures compensation for authors without hindering P2P networks and
the innovation that this technology brings about: compensation without
control.196
This chapter has shown, however, that none of the currently discussed
models is in accordance with obligations contained in international copyright
law. The BC, TRIPS and WCT rest upon the notion of legal and technological
exclusivity enjoyed by the copyright owner. These international instruments
are opposed to the implementation of statutory, non-voluntary licenses covering non-commercial file sharing. Only if the right holder is free to decide
whether he or she wants a work to be subject to a levy/tax system is exclusivity as the fundamental requirement of international copyright law satisfied. As
a result, exclusive rights and individual licensing have to be the legal default.
Therefore, only an opt-in model, in which the right holder has to register the
work for the levy/tax system, can be implemented in national law without the
need to either amend international copyright treaties or terminate membership.
Although this approach has some significant drawbacks, particularly with
regard to the number of works available for lawful sharing, it nevertheless
provides a business model not available today, to accept file sharing in exchange
for indirect compensation. It is also superior to voluntary collective licensing in
that it generates funding up front and thereby gives copyright owners an incentive to opt for sharing. In sum, the bipolar opt-in copyright system caters to a
permanent coexistence of speaking in economic terms property and liability
rules in cyberspace. Whereas the architecture of proprietary exploitation is
constructed by the copyright owner, the levy/tax system has to be established by
the government. Neither form of exploitation is outlawed.197 Instead, the choice
194
For the limited holding of MGM, 125 S.Ct. 2764 (2005), see supra Copyright
and peer-to-peer networks at p. 151.
195
See Lessig, supra n. 32, at 195; Shih Ray Ku, supra n. 40, at 55357.
196
Lessig, supra n. 32, at 201.
197
See also Einhorn and Rosenblatt (2005), 52 J. Copyright Society of the USA.
194
between the two is up to the copyright owner. As a result, this approach enhances
freedom and triggers competition between the two alternatives for the exploitation of works in the digital network environment. All in all, it supports creative
pursuits through exclusive rights and innovation in and development of new
communication technologies.198
What this chapter finally shows is that in thinking about new approaches,
existing copyright law must be considered as it is rooted in international law
to a large extent, which in turn is binding upon national and even supranational
legislatures such as the EC. The crucial question to be answered is what this
chapter tells us about the harmonization of copyright law in general. In my
opinion, it is necessary to carefully examine the drawbacks of international
harmonization as regards the flexibility of copyright legislation.199 This is true
not only for developing countries,200 but also for highly industrialized nations.
Copyright in general is directly linked to and has always reacted to technological changes. Accepting this insight, modern national copyright laws
provide for expiration dates of certain provisions,201 for specific measures to
quickly amend the law,202 or at least for obligatory, regular reports on the
effects of the law.203 Even if one does not call into question the international
239, 271(In other words, P2P and DRM technologies should be left to evolve together
. . .).
198
These were the two seemingly opposing policy considerations at the heart of
the Grokster decision; see MGM, 125 S.Ct. 2764, 2775 (2005) (The more artistic
protection is favored, the more technological innovation may be discouraged. . .); id.
at 11, n. 8 (The mutual exclusivity of these values should not be overstated,
however.); see also id. at 2 (Breyer, J., concurring) (referring to the need for the law
to strike a balance between a copyright holders legitimate demand for effective not
merely symbolic protection of the statutory monopoly, and the rights of others freely
to engage in substantially unrelated areas of commerce.).
199
See generally Annette Kur (2004), A New Framework for Intellectual
Property Rights Horizontal Issues, 35 IIC 1, 20; contra Sirinelli, supra n. 12, at
2627 (pleading for additional harmonization); Reinbothe & von Lewinski, supra n.
69, Art. 10 WCT no. 11 (recognizing the need to flexibly interpret the three-step test in
light of changing market conditions, focusing, however, solely on strengthening the
position of authors); Goldstein, supra n. 50, at 20911.
200
See the preamble of TRIPS: Recognizing also the special needs of the leastdeveloped country Members in respect of maximum flexibility in the domestic implementation of laws and regulations in order to enable them to create a sound and viable
technological base.
201
See 17 USC 119(a)(1), (e); Sec. 52a, 137k German CA (proclaiming that
one limitation to copyright Sec. 52a German CA expired on 1 January 2007).
202
See 17 USC 1201(a)(B)-(D) (rulemaking of the US Copyright Office
regarding certain classes of works that are exempted from the legal protection of technological measures).
203
See 17 USC 1201(g)(5); Art. 12 Copyright Directive, supra n. 100 (both
concerning the legal protection of technological measures).
195
204
See Kur, supra n. 199, at 20 (naming soft law and recommendations as an
alternative).
205
This applies even to the proposals discussed herein. These may become obsolete, just like todays file sharing, because of easier Internet access which enables information from commercial databases to be streamed; see Lessig, supra n. 3, at 30004.
206
Ficsor, supra n. 75, at 5.50; Senftleben, supra n. 56, at 30411.
207
But see Senftleben, supra n. 56, at 304 (arguing that the three-step test lends
sufficient weight to the interests of authors and users alike and that it was wise to
embrace the three-step test to circumscribe the ambit of operation of permissible limitations in the digital environment).
197
buy an entire classic album rather than purchase individual tracks.4 Other
developments in the British music industry indicate a shift away from traditional models of music distribution. Radiohead initially released the album In
Rainbows via digital download only, with fans being able to decide how much
to pay for the album. While surveys indicate that fans may, on average, have
paid as little as 4 (with one third of fans paying nothing at all),5 it is generally thought that by stripping away the margins normally afforded to the
record companies and retailers, Radiohead still netted increased profits as well
as considerable kudos amongst Internet music users. Nor is this kind of
marketing model being used exclusively by major and established acts who
have, like Radiohead, been able to break free from record labels. Indie band
The Crimea gave away its second album, Secrets of the Witching Hour in
2007, the band being only one of many acts which have realized that the
revenue opportunities being afforded to touring, live performances and
merchandising outstrip record sales by some distance.6 Any perusal of social
networking sites such as Facebook will show up the importance of this kind of
marketing and distribution mechanism, often encapsulated in the fact that fans
are able to access music legally and for free. Indeed, bands likes Koopa have
broken into the singles charts without a record deal of any kind, relying heavily on social networking sites to publicise and distribute their works, often by
actively encouraging fans to share music files with friends as part of their
social experience that Facebook, etc. seek to foster. Of course, where a sound
recording copyright is involved, MySpace and Facebook etc. will no doubt
seek and obtain licenses, but this may not always be necessary
File sharing is not per se illegal; it also benefits creators and right holders
by meeting consumer demand. Some right holders and other entities in the
entertainment products distribution chain may not like the way in which digital distribution and greater consumer choice have challenged traditional
markets for example, the impact of direct download and on-demand services
on the retail industry but the process is irreversible.
This chapter seeks to explore the file-sharing phenomenon in the context of
international copyright norms and the response that the activities of file sharers have provoked from the music industry and national courts. Its focus,
given that the legal response is rooted in individual jurisdictions, is the law of
the UK and Ireland, although case law from other jurisdictions is examined.
4
Downloads make hit singles again. Available at www.washingtonpost.com/
wp-dgn/article/2006/02/07
5
How much is Radioheads online album worth? Nothing at all, say a third of
fans. The Times 11 October 2007.
6
Album giveaway could ignite music revolution, The Guardian 30 April
2007.
198
What emerges is a much more complex picture of the liability issues that litigation has generated, with a greater number of potential actors being caught
up in potential liability scenarios than was previously thought. While many
commentators have rightly questioned whether right holders have sufficiently
appreciated the opportunities afforded by new methods of music transfer
often blaming market failure for encouraging illegal copying by users there
are signs that the courts are coming to grips with file sharing. However, signs
of structural change are appearing in the way in which issues of online liability and immunity are addressed, with consequences for the future operation of
ISPs. Indeed, some decisions explore the possibility of allocating both the risk
and liability in a much more horizontal way than the early stages of the debate
on file sharing could possibly have anticipated, drawing attention in numerous
jurisdictions to the possibility that acts of infringement of copyright can be
impeded, if not negated entirely, by technical measures at a variety of levels.
7
8
199
These Articles provide a clear basis for protecting authors works and sound
recordings from piracy and unauthorised online transfer. Before the adoption
of the WIPO Treaty, online dissemination (to use a legally neutral word) of
copyright works created several conceptual difficulties for judges as definitions and terms of art that were apt earlier in the previous century do not make
sense in a digital environment. The reproduction of a work, the publication of
a work, the distribution of a work, and the broadcasting of a work are the four
cornerstones of liability, but their late 20th century relevance was problematical. When a work exists solely in an electronic format, some jurisdictions have
found it difficult to hold that the replication of the work in that form is an
infringing act.11 While these cases reflect in part the failure of national legislatures to keep statutes in step with international treaties, delays in the implementation of treaty obligations can and do occur. Moreover, on the difficult
political issue of defining reproduction, the international community failed to
produce a definition (the 1996 Geneva treaties contain something less than a
satisfactory outcome on this point).12 On the issue of ISP liability through the
communication of a work to the public, however, Art. 8 of the WIPO
Copyright Treaty is fleshed out by an Agreed Statement which provides that
the provision of physical facilities does not amount to a communication within
the treaty or the Berne Conventions. The Hague Court of Appeal referred to
this in Church of Spiritual Technology v Dataweb BV in dismissing copyright
infringement actions against website hosts, the court holding that service
providers only provide the technical facilities for others to expose information.
Therefore it does not seem right to consider them as being equivalent to
publishers.13 A French court reached a similar conclusion,14 but it is the
Supreme Court of Canada that has most authoritatively analysed the legal
characteristics of online distribution of copyright works. This decision is
important, given that Canada at the relevant time had not ratified the 1996
Treaties.
11
See e.g. Ireland in cases like News Datacom Ltd v Lyons [1994] 1 ILRM 450
(smartcards) and Gormley v EMI [1999] 1 ICRM 154 (tape recorded speech not a
work).
12
The failure of the 1996 WIPO Diplomatic Conference to flesh out the reproduction right was in part ameliorated by the Agreed Statement concerning Art. 1(4).
13
[2004] ECDR 258 [269].
14
Perathoner v S. Joseph Socit Free [2003] ECDR 76. See generally Gervais
(2001) 34 Vand J Transnatl L 1363.
200
15
Copyright Board of Canada (1999) 1 CPR (4th) 417: Federal Court of Appeal,
(2002) 215 DLR (4th) 118.
16
RSC 1985, c C-42, amended by 1988, c 65.
17
The treaties had been signed but not ratified.
201
sary for another person to so communicate the work or other subject matter does not
communicate that work or other subject-matter to the public.18
18
19
20
202
He cited, with apparent approval, the Boards conclusions that, with respect to
most transmissions, only the person who posts a musical work communicates
it and that the content provider effects the communication.
Binnie J then suggested that mere conduit status will be scrutinized by the
courts in appropriate cases, citing both Art. 8 of the WIPO Copyright Treaty
and Recital 42 of the EC Electronic Commerce Directive.23 Noting that lack
of knowledge is not a defence to copyright liability, the opposite could well be
a basis for denying protection under s. 2.4(1)(b): the presence of such knowledge [that illegal files are held] would be a factor in the evaluation of the
conduit status of an Internet Service Provider. 24
Thus, the Supreme Court of Canada both provided an analysis of who is an
infringer in an online transmission and proposed that any immunity, whether
based on a specific statute or as a matter of general law, may need a balanced
analysis rather than a blanket application in favour of either right owner or ISP.
SOCAN bridges earlier case law, in which conduit status generally afforded
an immunity,25 and the more pragmatic position reached in the file-sharing
cases. Binnie J clearly considered that the balance of interests of users and
right holders could best be served by following the knowledge of infringing
materials and notice and take down procedure found in the Electronic
Commerce Directive.26 Viewed in this light, the file-sharing cases are more
21
22
23
24
25
203
27
Copyright Designs and Patents Act 1988, ss. 2227, as amended; (UK)
Copyright and Related Rights Act 2000, ss. 3743 (IRL).
28
Copyright, Designs, and Patents Act 1988, ss. 2227 (UK); Copyright and
Related Rights Act 2000, ss. 4448 (IRL).
29
Reform Party of Canada v Western Union Insurance Co. (1998) 3 CPR(4th)
289.
30
(2003) 233 (4th) 382.
31
(2004) 236 DLR (4th) 395; see Gervais (2004) 18 IPJ 131.
32
(2004) 63 IPR 258 (New South Wales).
204
fit file sharing into pre-Internet terminology such as acts of performance and
distribution33 of a work. Even where the making available right is transposed into national law, the trend in most common law jurisdictions is to use
the concept of authorization of infringement, a concept that exists independently34 of primary infringement in the legislation of jurisdictions such as
Ireland, Australia, Canada, and the UK.35 The attraction of using the authorisation concept is that the defendant may not actually participate in the infringing act but, where that person facilitates infringement by others, or sanctions
or approves of such conduct, liability may result. In a recent case, a party who
instructed the employees of another to data mine the plaintiff s database had
committed an act of authorisation for which he could be personally liable.36
The utility of the authorisation concept is evidenced by the fact that, in the
US file-sharing cases, the courts have had to resort to basic common law
concepts such as vicarious infringement and contributory infringement, as
well as devising a notion of inducement, in order to visit liability on the defendants.37 In many European jurisdictions, the courts also had to rely on general
principles of civil liability, such as whether the facilitation of file sharing can
provide the basis for liability as an accessory.38 The general result appears to
be that liability will be imposed if the primary infringer, in this case, the downloader, does not have a defence such as private use (the conclusion reached in
Bruvik, which also discussed the possibility of contributory infringement).
Thus, the gap between civil law solutions to this new problem and the line of
authority in the US may not be significant, at least in terms of finding common
approaches to the issues.
33
See e.g. Bruvik v EMI Norsk SA [2005] ECDR 331; see also Krog (2006) 22
CLSR 73.
34
Gummow J in WEA International Inc. v Hanimex Corporation (1987) 17 FCR
274.
35
Authorization of infringement first appeared in the Copyright Act 1911, s.
1(2).
36
Nominet UK v Diverse Internet (2004) 63 IPR 543 (Western Australia).
37
US Senate Bill s. 2560 posited a new basis for liability. For a discussion of this
Bill in the context of Grokster see Band (2005) Computer and Internet Lawyer 22: 1
38
KODA v Lauritzen and Egeberg [2002] ECDR 25 (Denmark); Bruvik v EMI
Norsk [2005] ECDR 332 (Norway).
205
39
40
Directive 2000/31.
The classic cases are Stratton Oakmont v Prodigy Services Co. (1995) 23
Media L.Rep. 1794 and Cubby v Compuserve 776 F Supp 135 (1991).
41
Communications Decency Act 1996 (47 USC s 230 et seq.). See generally
Voelzke (2003), Computer and Internet Lawyer 22: 4.
42
[2001] QB 201.
43
As required by s. 1(5).
44
[2006] EWHC 407 QB.
206
Godfrey, Morland J considered that both US case law and the US statutory
immunity were much broader than that afforded to an ISP under English law
but the Defamation Act 1996 solution, as well as US legislative initiatives,
clearly influenced the shaping of the European solution to online civil liability in the form of the Directive.
2000/31.
The Electronic Commerce (EC Directive) Regulations 2002 (2013/2002) (as
amended by 1178/3005) Articles 1719.
47
European Communities (Directive 2000/31/EC) Regulations 2003 (SI
2003/68).
207
However, liability will not result if the ISP merely hosts content without, as in
Hi Bit, having any knowledge of illegal copyright material, and the ISP acts
expeditiously to disable access when furnished with adequate details of unlawful material. French case law52 suggests a distinction between defendants who
host content as distinct from providing a link to content hosted elsewhere. The
common law jurisdictions reflect this distinction between positive inducement
of others to file share (as in HiBit) and a general awareness that the defendants
48
49
208
facilities may be used by others to share files. While there has been no reported
case law on file sharing in the UK, other common law jurisdictions have been
hotbeds of file-sharing litigation. The US decisions in Grokster53 and
Napster54 have the most high profile in the file-sharing arena, but recent
Australian case law may be of greater clarity and relevance than Grokster, for
example, at least to common law jurisdictions
Similar reasoning has also been applied in Europe. In KODA v Lauritzen and
53
125 S Ct 2764. The subsequent reaction to Grokster was immense; e.g.
Blakeney [2006] CTCR 55; Ganley [2006] EIPR 15; Hogberg (2006) 106 Col LR 909;
Radcliffe 22 CLSR 137. 50.
54
A&M Records, Inc. v Napster 239 F 3d 1004 and 284 F 3d 1091 (2002).
55
(2005) 65 IPR 409, exhaustively reviewed by Hyland at (2005) 10(5) Comms.
Law 157.
56
(2005) 65 IPR 409 [424].
209
Egeberg,57 the Vestre Landset, Denmark, found that when two children who
maintained their own websites created links directly to infringing music files,
they were liable as principals and accessories to infringement. The reasoning
on principal liability is difficult to reconcile with the Swedish Supreme Court
decision in Public Prosecutor v Olssen58 where it was held that making a link
is not an act of distribution. The controversial Dutch decision in Vereniging
Buma, Stichting Stemra v Kazaa59 may have broader precedent value, the
Court of Appeals holding that Kazaa was not liable for the actions of others
because the facilitation of infringement by third parties was not of itself an act
of publication, nor was such conduct an act of reproduction in its own right.
The best-known first generation file-sharing decision is that of the Ninth
Circuit Court of Appeals in A&M Records, Inc. v Napster,60 the leading decision arising out of the notorious file-sharing service Napster.61 Napster
permitted members of the Napster Community of users, following sign-up and
the downloading of free software from site, to search and download music
from the hard drives and servers of other Napster users. Napster provided both
user support and indexing facilities via its central registry. While it was not in
dispute that Napster was a primary infringer, Napster sought to counteract allegations of contributory and vicarious infringements by arguing that, since its
users did not infringe copyright, no case for its secondary liability could be
made out. Fair use defences in respect of the sampling of music files were
rejected, as was a defence of time shifting.
The Court of Appeals for the Ninth Circuit has handed down a fairly prouser decision on linking, Kelly v Arriba Soft Corporation.62 Although fair use
did not feature in the Ninth Circuits later decision in Grokster,63 Napster is
rooted in the factual link between the activities of Napster in directly stimulating infringement by its users and the common law concepts of contributory and
vicarious infringement as the basis of civil liability. So, while the US approach
to issues of secondary liability is constrained to use common law concepts to
visit liability on file-share facilitators, other jurisdictions have specific statutory
provisions than can be used in such context. The Copyright Act 1911 being the
basis of Irish, Canadian, Australian, and New Zealand statutory traditions, the
concept of infringement by authorising others to commit acts of primary
infringement is an extremely important means of redress.
57
58
59
60
61
62
63
210
In the classical sense, authorisation of infringement is made out by showing that the primary infringer has the benefit of another persons sanction,
approval or countenance. Case law makes it clear that mere knowledge that
another person may infringe copyright is not enough to constitute acts of
authorisation and that the person having authorised infringement may only do
so where he or she has the necessary power to control the infringing act. Thus,
hiring out sound recordings in the knowledge that hirers may make copies in
the privacy of the home will not make the hirer an authoriser,64 nor does the
sale of a tape recorder, even on the foot of advertising copy that refers to copying, make the seller of that equipment an authoriser (although this decision is
borderline65). Nevertheless, Universal Music Australian Pty Ltd v Cooper66
supports the view that the provision of file-sharing facilities may be acts of
authorisation if the putative authoriser is shown to have sufficient control over
both the user accessing the website and any remote operator placing hyperlinks on it. Cooper did not monitor users to see if the files being downloaded
were legal, nor did he scrutinise those linking to his site for illegal content. As
such, Cooper was held to have infringed copyright by authorising both downloading by users and of the making available of illegal files by operators of
remote websites.
At the heart of Cooper is a notion of authorisation that is rooted in the failure to exercise control over others. The Australian cases in particular stress the
possibility that authorisation may occur by omission: where a defendant has
abstained from action which under the circumstances then existing it would
have been reasonable to take, or . . . exhibited a degree of indifference . . . ,67
permission may be inferred. Canadian case law has specifically rejected this
reasoning68 and it has yet to find favour in England because it is incompatible
with Amstrad. However, as a recent New Zealand Court of Appeal decision
points out, Amstrad was a case on its particular facts, where the defendant had
no control over the domestic use of a technology that could be put to substantial non-infringing uses as well as infringing ones.69 In the file-sharing cases,
64
65
211
the courts have held that the defendant had the capacity both to monitor use
and restrict (albeit imperfectly) access to illegal files. Amstrad does not represent a barrier to the use of the authorisation of infringement concept by an
English court and the obiter statements of Binnie J in SOCAN70 do not suggest
an aversion to finding that an ISP has authorised infringement in specific
circumstances.
212
213
78
The US music industry apparently conceded that, if a music CD is lawfully
purchased, it will be lawful for the purchaser to load it onto a PC or MP3 player, but
copyright legislation in the USA and elsewhere does not reflect this. See comment by
DB Verrilli, Counsel for MGM in Grokster, cited by Ganley [2006] EIPR 15 [19].
79
IFPI: 07 Digital Music Report p. 18.
214
80
81
82
83
See www.pcpro.co.uk/news/.
Statement to High Court, Dublin, 23 January 2006.
(2005) 65 IPR 289 at 372 per Wilcox J.
See the equitable Civil Bill procedure in BMG Canada Inc. v John Doe (2005)
252 DLR (4th) 726.
84
[1974] AC 13.
215
216
those for which the personal data was legitimately obtained. Other data protection principles such as the security principle are also relevant.
The fact that ISPs may compile user records that reveal a considerable
amount of information about an individual user was recognized in 2001 when
the Irish government added ISPs to the list of data controllers who must register with the Data Protection Commissioner.92 In BMG Canada Inc v John
Doe,93 the Canadian Federal Court of Appeal indicated that the balance
between the protection of privacy and the rights of intellectual property
owners would generally turn upon the force of the perceived threat to the
integrity of intellectual property rights. BMG Canada Inc. sought Norwich
Pharmacal-type orders against numerous ISPs (the applicants). Having identified 29 file sharers who had each downloaded over 1000 songs, BMG sought
the names and addresses of those persons, providing the ISPs with the users
pseudonyms.94 Noting that the traditional Norwich Pharmacal approach
requires a balance between maintaining the integrity of confidential information and the protection of clearly established intellectual property rights which
have been infringed, the Court lowered the threshold by requiring the plaintiff
to establish a bona fide claim to be pursued and not a prima facie case of
infringement of an intellectual property right. Sexton JA reasoned:
Intellectual Property laws originated in order to protect the promulgation of ideas.
Copyright law provides incentives for innovators artists, musicians, inventors,
writers, performers and marketers to create. It is designed to ensure that ideas are
expressed and developed instead of remaining dormant. Individuals need to be
encouraged to develop their own talents and personal expression of artistic ideas,
including music. If they are robbed of the fruits of their efforts, their incentive to
express their ideas in tangible form is diminished.
Modern technology such as the Internet has provided extraordinary benefits for
society, which includes faster and more efficient means of communication to wider
audiences. This technology must not be allowed to obliterate those personal property rights which society has deemed important. Although privacy concerns must
also be considered, it seems to me that they must yield to public concerns for the
protection of intellectual property rights in situations where infringement threatens
to erode those rights.95
SI 2001/2.
(2005) 39 CPR (4th) 97 and (2005) 252 DLR (4th) 726, reversing the Motions
Court decision at (2004) 239 DLR (4th) 726.
94
See e.g. Geekboy@Kazaa.
95
(2005) 39 CPR (4th) 97 at 115.
217
In making the order, the Court may be expected to impose strict conditions
upon the applicant. In BMG Canada, the Federal Court stressed that the information disclosed should not be unrelated to copyright infringement and that
specific directions should be given as to the type of information disclosed and
its manner of use. Privacy should be respected by an order that the user be
identified by initials or protected by a confidentiality order. Kelly J endorsed
this approach in the Irish High Court in EMI Records (Ireland) Ltd and Others
v Eircom Ltd and BT Communications Ireland Ltd96 where four major record
companies sought Norwich Pharmacal orders in respect of 17 habitual downloaders. Granting the orders, Kelly J found that the plaintiffs had established
prima facie infringement and that no other recourse was available to obtain the
names and addresses of the users. Noting the importance of duties of confidentiality owed by the defendants to their subscribers and the subscribers
rights of privacy, Kelly J held that these duties and rights:
cannot be relied on by a wrongdoer or a person against whom there is evidence of
wrongdoing to protect his or her identity. The right to privacy or confidentiality of
identity must give way where there is prima facie evidence of wrong doing.97
Kelly J then built safeguards into the order. The plaintiffs were required to
undertake to use the information disclosed in compliance with the order only
to obtain redress in respect of copyright infringement in the sound recordings
covered by the plaintiff s Irish license; thus, indicating that the information
could not be transferred to a UK or US counterpart. The plaintiffs also undertook not to disclose the identities of the subscribers until the plaintiffs began
to enforce their copyrights against those persons. Kelly J explained:
This is being done in protection of the rights and entitlements of the subscribers
because it may turn out that they were not in fact guilty of any wrongdoing or that
the named person was not the operator at the time when the wrongdoing was in fact
carried out.98
The defendants were held entitled to costs of the action (including the costs
of actually making the disclosure) from the applicant.99
96
[2006] ECDR 40. For a robust Hong Kong counterpart, see Cineplay Records
Co Ltd v Hong Kong Broadband Network Ltd [2006] 1 HKLRD 255.
97
Ibid 43.
98
Ibid 44. A second phase of actions commenced in late 2005, culminating in
similar orders being made on 26 January 2006 (unreported).
99
Following the Court of Appeal (England and Wales) in Totalise plc v Motley
Fool Ltd and Interactive Investor [2001] EWCA Civ 1897. A second set of proceedings
brought in the Irish High Court in 2007 led to disclosure orders against seven ISPs: see
IRMA to get web users details Irish Times 8 June 2007.
218
These Dutch decisions are important because they demonstrate that the right
to operate as an ISP can involve the observance of a duty of care and that the
Electronic Commerce Directive far from creating an immunity in respect of
these operations, will incline in the opposite direction. Recent Italian case law
had inclined in favour of ISP disclosure orders although a definitive appellate
decision is expected shortly.104
100
Decision of the District Court of Utrecht of 12 July 2005, judgment translated
into English by SOLV Advocaten: www.solv.nl.
101
2000/31.
102
2004/48.
103
Decision of 25 November 2005. See the February 2006 newsletter of
Kennedy Van der Laan available at www.kvdl.nl.
104
See Prosperetti [2007] Ent. L.R. 280.
219
While he conceded that the law did not prescribe the conditions under which
an order may be made, the necessity test vis--vis Norwich Pharmacal is
flexible enough to afford a basis for such an order.
What may remain unexplored is the difficulty right holders may have in
some jurisdictions in collecting evidence. Case law suggests that the standard
methodology is to engage the US agency MediaSentry to monitor volume uses
of MP3 files, taking a 10 minute snapshot of real-time users in order to identify
105
CNIL decision, 24 October 2005. See generally Richardson (2002) 13 JLIS 90
on misuse of discovery procedures.
106
See www.ifpi.org. A more pertinent issue is the survival of the private copying defence under French law, the current debate being reviewed by Hugo and Hugot
[2006] Ent L. R. 139.
107
Data Protection Act 1998, s. 35 (UK); Data Protection Act 1988, s. 8(e)
(Ireland).
108
See e.g. the relevant rules of civil procedure, discovery, etc. In England and
Wales, see the Civil Procedure Rules.
109
[2006] ECDR 40.
110
Ibid 43.
220
Available at www.theregister.com/2006/07/14fileswappers_protected.
(2005) 65 IPR 289 at 348. The evidence admitted in Sharman revealed for
example that users may be able to shelter behind firewalls. Some software applications
to ensure anonymity are being researched. See e.g. www.freenet.sourceforge.net and
www.relakks.com; Comber and Staple [2007] ECL & P 9(7), 911.
113
2002/58, as amended by Directive 2006/24, transposed in Ireland by SI
2003/535; for UK transposition see SI 2003/2426.
114
Kennedy v Ireland [1987] IR 587; Atherton v DPP [2006] 2 ILRM 153.
115
In the UK, see the Regulation of Investigatory Powers Act 2000, ss. 12.
116
For example, if the evidence is illegally or unconstitutionally obtained,
English law contains an exclusionary discretion, case law indicating that any privacy
intrusion is a relevant consideration for the court: see Jones v University of Warwick
[2003] 3 All ER 760. In Irish law, there is a discretion in relation to illegally obtained
evidence but a complete bar in unconstitutionally obtained evidence: see McGrath,
Evidence (2005) Chapter 7. The leading case is Universal City Studios v Mulligan
[1999] 3 IR 392.
221
117
118
119
http//www.heise.de/English/newsticker/news/93759.
Case C 275/06: Summarised at [2007] ECDR 390.
In 2005, the European Institutions put forward two texts, a Framework decision and a draft Directive. The Framework decision was rejected by the European
Parliament.
120
The obligations to retain data and provide such data is reserved for the
222
223
Tiscali responded that the information provided is not evidence of infringement and that, without a court order, Tiscali will respect the privacy and data
protection rights of its subscribers.127
Again, ISPs are in a difficult position. While an ISP must act expeditiously,
must it take the right holder at its word? Under the standard cease and desist
case law in the UK,128 the person served with the notice must have the opportunity both to consult the alleged infringer and to take legal advice; it is hoped
that this is part of the notice and take down procedure under the Electronic
Commerce Directive. Further, it would be appropriate for the right holder to
agree to indemnify the ISP in the event of the complaint against the subscriber
being ill-founded. However, without, any judicial process, it is difficult to see
how this mechanism can evolve. It is perhaps best if the courts continue to
require right holders to employ discovery or Norwich Pharamacal principles,
possibly allowing the court to hold that there is sufficient prima facie evidence
of infringement to warrant withdrawal of service to the user. The integration
of discovery or Norwich Pharmacal procedures into notice and take down
powers may be expensive and cumbersome but any alternative puts ISPs in a
predicament.
125
Court ruling confirms Internet Service Providers must act to stop piracy,
available at www.ifpi.org/site-content/PRESS20060215.html.
126
Available at www.pcpro.co.uk/news/90078/bpi-pressures-isps-to-suspendfilesharing-accounts.html?searchString=news+90078 (last accessed 1 November
2008).
127
Available
at
www.pcpro.co.uk/news/bpi-pressures-isps-to-suspendfilesharing-accounts.html?searchString=news+90078 (last accessed 1 November
2008). Tiscali instead provided evidence of infringement in the form of screenshots and
user connections.
128
Infabrics Ltd v Jaytex Shirt Co [1978] FSR 451; Vermaat v Boncrest (No 2)
[2002] FSR 21.
224
Is this all worth the effort? Serial file sharers can be expected to take out
new subscriptions with other ISPs, change IP addresses, and resort to firewalls
and other technical ways of avoiding detection. Research projects in the
pipeline will allow users to go online with some assurance of privacy129 while
the encryption of files raises the computer forensics exercise to a new level.
But the music and entertainment industries must be seen to be doing something to tackle the P2P problem130 and the emphasis that the recording industry appears to be placing on ISPs seeks to both erode the safe harbour
immunities and make ISPs civilly and even criminally liable for third-party
wrongdoings.131 Some organisations in the UK are pressing for the expansion
of copyright in the form of a value recognition right that would make unlicensed ISPs liable in damages for third-party file sharing amongst its
customers, and while this initiative is unlikely to progress, the record industry
may be getting its way via a more indirect route.
The Weakening of ISP Immunity in UK Law
In Bunt v Tilley,132 Eady J noted concern over distinguishing between the shelter from damages and penal sanctions that the Electronic Commerce Directive
affords, while leaving open the exposure to injunctive reliefs that the Directive
does not close down; the ISP defendants were not party to meaningful injunctive proceedings in that case, and on the facts, Eady J held that injunctive relief
would not have been forthcoming as the ISPs had cancelled contracts and
taken other remedial measures anyway. But within the UK, the signs are that
the ISP immunity is unlikely to survive for much longer. This is not simply
because of judicial proceedings such as the Bunt v Tilley dicta or the 2006
Tiscali proceedings, outlined above. A number of straws in the wind are pointing towards a convergence of technical solutions and a changing regulatory
climate. In 2005, the (then) UK Department of Trade and Industry (DTI) initiated a consultation exercise133 on the possibility of expanding mere conduit
type immunities to hyperlinkers and the providers of location tool services and
129
130
225
data content aggregators, but the DTI concluded134 that there was insufficient
evidence to justify the expansion of any safe harbour immunity. Indeed,
industry had expanded, even absent such immunity, and it may be that this
conclusion has contributed to an awareness that the Electronic Commerce
Directive of 2000 does more than is actually necessary to stimulate the growth
of the Information Society.
A parallel development from the area of child pornography and Internet
content regulation has also fuelled the view that ISP immunity is in need of
revision. The UK, in 1996, established the Internet Watch Foundation (IWF)
charged with developing a safer Internet environment, specifically in relation
to counteracting on-line child pornography. In 2004, the largest ISP, British
Telecom, launched BT Cleanfeed, a blocking service that relies upon the IWF
providing a list of URLs, on a daily basis, and Cleanfeed blocking access to
suspect sites on the list. This blocking technology is regarded by critics as
being crude and mechanical, but it has caught the attention of both the public
and law enforcement as having a measure of effectiveness. In fact, the Gowers
Review on Intellectual Property, published in 2006,135 clearly had one eye on
this kind of technology when recommending the development of a negotiated code of practice between UK rightholders and ISPs, setting a deadline of
one year for such a code to emerge. More recently still, the House of Lords
Science and Technology Committee, in its report, Personal Internet Security,
published on 10 August 2007,136 suggested that it is now appropriate to take
a nibble out of the blanket immunity137 afforded by the mere conduit
defence. This recommendation was framed in the context of requiring ISPs to
monitor customer traffic that may, perhaps unwittingly, contain a virus or
spam. The Science and Technology Committee took the view that it is unrealistic to place the onus for ensuring Internet service safety onto the shoulders
of the end-user. The Committee recommended, at paragraph 3.69 that:
the mere conduit immunity should be removed once ISPs have detected or been
notified of the fact that machines on their network are sending out spam or infected
code. This would give third parties harmed by infected machines the opportunity to
recover damages from the ISP responsible. However, in order not to discourage
ISPs from monitoring outgoing traffic proactively, they should enjoy a time-limited
immunity when they have themselves detected the problem.
134
135
226
What we are witnessing here is a not-so-subtle shift away from the principle
that merely providing a facility that might be used by others to infringe the
criminal or civil law will not, of itself, produce liability for the service
provider. This principle is apparently being replaced with a statistical analysis
of levels of illegal Internet traffic, informed by technical evidence that some
forms of blocking or filtering will diminish the flow of illegal music or audiovisual files. When this analysis is combined with evidence that an ISP is indifferent to file-sharing activities and that the ISP could adopt countervailing
measures (in terms of practical steps and actions that would be contractually
possible), the fact that an actual complaint may have been made is likely to
derail any mere conduit defence.
The SABAM v Scarlet Decisions
Insofar as injunctive relief is sought to this extent, the controversial decision SCRL Socit Belge des Auteurs Compositeurs et Editeurs v SA
Scarlet138 may be a harbinger of the Europe-wide emasculation of the
Electronic Commerce Directive safe harbours. Here, the plaintiff, SABAM,
obtained judgment against Tiscali, later renamed as Scarlet, in November
2004 as a result of cease and desist proceedings brought against Tiscali as
an ISP whose network was being used by third parties for P2P file sharing
of illegal music files. The Brussels Court of First Instance appointed an
expert to advise on technical measures that Tiscali could adopt to stop copyright infringement by users. Although the expert noted that the most appropriate form of filtering technology, Copysense Network Appliances
Audible Magic, was educational software not designed to deal with ISP
traffic or encrypted files, the Court noted that MySpace and Microsoft had
either used or announced an intention to use Audible Magic. The Court also
brushed aside evidence that the software in question could throw up false
positives (that is, block legitimate transmissions) and found that the cost of
installation (some 0.50 per subscriber per month over a three-year period)
meant that a technical solution was possible, giving Tiscali six months to
install the relevant technical solution. The Court indicated that this decision
did not set aside the Electronic Commerce Directives provision that an ISP
has no duty to monitor content, noting that the Directive does not touch
upon the jurisdiction of a cease and desist judge and that Recital 40 of the
Directive specifically approves of technical surveillance instruments. This
decision is under appeal. While distinguishing immunity from damages and
138
227
228
file sharing to take place; such entities encourage and incite file sharing in
the language of Irish and UK copyright law, they authorise others to
infringe. Unlike ISPs, such entities are not permitted to resort to the safe
harbour of the Electronic Commerce Directive. On the other hand, the ISP
should not monitor content. But as a result of the SABAM decision, the ISP
now only has to be served a notice that illegal content is being transmitted
via its service and, if evidence of some kind of technical solution is
presented, the ISP will not only have to install it, the ISP will have to charge
its subcribers also. The convergence of the reasoning in the Australian
Sharman142 case and the Belgian SABAM decision overlooks the critical
differences in relation to culpability, and in jurisprudential terms, undervalues and threatens civil liberties. All the right holder needs to invoke are
injunctive proceedings in order to sidestep the Electronic Commerce
Directive and impose upon an ISP proactive duties to place filtering technology onto the ISPs services and pay for it too. Add to this mixture the
confusion at the level of national law and criminal and civil litigation, and it
is hard not to escape the conclusion that single market harmonization of
Intermediary Service Providers through the Electronic Commerce Directive
has been a complete failure.
142
230
are free to devise new exceptions and limitations that are appropriate in the
digital network environment.3
The treaty also calls for nations to provide adequate legal protection and
effective legal remedies against the circumvention of effective technological
measures that are used by authors in connection with the exercise of their
rights,4 although such rules should not impede acts that are permitted by law
or otherwise beyond the authority of copyright owners.5 The treaty gives no
guidance, however, about how nations might implement this anti-circumvention norm so as to enable privileged and other public interest uses of copyrighted works.
While the WCT embodies a negotiated balance between copyright owners
and users of digital works, the translation of this balance into the domestic
laws of the United States and the member states of the European Union has
not been fully successful.6 When enacting the Digital Millennium Copyright
Act (DMCA) of 1998 as the US implementation of the WCT,7 Congress
achieved a reasonable balance of competing interests in its creation of safe
harbours from copyright liability for Internet service providers and other intermediaries for the infringing acts of others.8 However, contrary to its apparent
intention, Congress failed to achieve a similar balance of interests when establishing new rules forbidding circumvention of technical protection measures
(TPMs) used by copyright owners to control access to their works and in regulating the manufacture and distribution of technologies primarily designed or
produced to enable circumvention of copyright-protective TPMs.9
3
4
231
10
Directive 2001/29/EC on the Harmonisation of Certain Aspects of Copyright
and Related Rights in the Information Society, Art. 6, 2001 O.J. (L 167) 10 [hereinafter
Copyright Directive]. This Directive is more restrictive than the DMCA in at least two
ways. First, it bans all acts of circumvention, not just circumventions of access
controls. Compare id. with 17 USC. 1201(a)(1)(A). Second, it lacks a set of built-in
exceptions and limitations such as those in the DMCA. Compare Copyright Directive,
supra, Art. 6, with 17 USC. 1201(c)(j).
11
Copyright Directive, Art. 6(4). We recognize that other commentators have
been more skeptical than we are about the will to carry through with this normative
commitment. See e.g., Severine Dusollier (2003), Exceptions and Technological
Measures in the European Copyright Directive of 2001An Empty Promise, 34 IIC
62; Inst. for Info. Law, Univ. of Amsterdam, Study on the Implementation and Effect
in Member States Laws of Directive 2001/29/EC on the Harmonisation of Certain
Aspects of Copyright and Related Rights in the Information Society, Final Report 73
(2007) [hereinafter Copyright Directive Implementation Study].
12
See infra nn. 295298 and accompanying text.
13
See id.; see also infra nn. 334340 and accompanying text.
14
Numerous commentators have noted the imbalance of the DMCA anticircumvention rules and their deleterious effects on fair, privileged, and other noninfringing uses of copyrighted works. See, e.g., Timothy K. Armstrong (2006), Digital
Rights Management and the Process of Fair Use, 20 Harv. J. L. & Tech. 49; Yochai
Benkler (1999), Free as the Air to Common Use: First Amendment Constraints on
Enclosure of the Public Domain, 74 N.Y.U. L. Rev. 354; Dan L. Burk and Julie E.
Cohen (2001), Fair Use Infrastructure for Rights Management Systems, 15 Harv. J.
L. & Tech. 41; Julie E. Cohen (1997), Lochner in Cyberspace: The New Economic
232
233
234
235
ISPs were, in the White Papers view, in a far better position to monitor and
control user infringements than copyright owners.23 The prospect of liability would give them strong incentives to ensure that their sites were not
used for infringing purposes and to develop technologies to deter infringements.24
The White Paper also recommended legislation to outlaw technologies the
primary purpose or effect of which was to bypass TPMs that copyright owners
used to protect their works.25 Without such protection, the drafters warned,
copyright owners would not be willing to make their works available in digital form. The White Paper contemplated no public policy exceptions to or limitations on the proposed anti-circumvention rules, a strategy that generated
considerable opposition and criticism.26 This section will discuss the different
ways that Congress responded to criticisms of the White Papers proposed ISP
and anti-circumvention liability rules.
ISP Safe Harbour Provisions
Congress had already begun to consider whether ISPs should be liable for
wrongful acts of their users, such as libellous postings on bulletin board
services, at the time the White Paper was published.27 In 1996, as part of a
telecommunications regulation reform measure, the telecom industry obtained
temporary copies made in the random access memory of computers as direct infringements of copyright. The White Paper discussed contributory and vicarious liability in
a different section. Id. at 10914.
23
Id. at 117.
24
Id. at 11718.
25
Id. at 23034.
26
See, e.g., Jessica Litman (2001), Digital Copyright: Protecting Intellectual
Property on the Internet 12265 (discussing the controversy). See also supra n. 21.
27
The ISP immunity provision was first introduced in Congress on 4 August
1995. See 141 Cong. Rec. H8468-69 (daily ed. 4 August 1995). Prior to this, the case
law on ISP liability for tortious acts of users was mixed. Compare Cubby, Inc. v
CompuServe Inc., 776 F. Supp. 135 (S.D.N.Y. 1991) (rejecting a defamation claim
against CompuServe because it did not monitor user postings) with Stratton Oakmont,
Inc. v Prodigy Servs. Co., 1995 WL 323710 (N.Y. Sup. Ct. 1995) (refusing to dismiss
a lawsuit similar to Cubby because, by monitoring some user postings for harmful
speech, Prodigy had shown it could monitor for defamation as well). The telecommunications industry became concerned that it would routinely be held liable for wrongful acts of users insofar as it policed its sites for any reason. The telecom industry
lobbied hard for Congressional preemption of decisions such as Stratton Oakmont. The
House Conference report makes clear that [o]ne of the specific purposes of [the immunity provision] is to overrule . . . decisions which have treated such providers and
users as publishers or speakers of content that is not their own. H.R. Rep. No. 104-458,
at 94 (1996) (Conf. Rep.).
236
a broad grant of immunity from liability for user wrongs.28 The industry
successfully argued that imposing liability on ISPs for wrongful acts of which
they were unaware was unfair and unwise. Requiring them to monitor their
sites for wrongful activity would not only interfere with user privacy and freedom of expression interests, but it would also increase dramatically the cost of
Internet access.
Self-regulation was deemed a more effective way to create incentives for
ISPs to ensure that their sites were being used for lawful purposes.29 At the
copyright industrys insistence, Congress carved out an exception to the
Communications Decency Acts (CDA) immunity provision for intellectual
property violations.30
Having won a broad grant of immunity in the first round of the fight over
ISP liability for wrongful acts of users, the telecom industry believed that, by
advancing the same arguments used to gain immunity under the CDA, it could
persuade Congress to reject the White Papers contention that that industry
should be held strictly liable for copyright infringements.31 ISP technology
platforms were, moreover, dual-use technologies, in the sense that they could
be as easily used for lawful as for unlawful purposes. Under the Supreme
Courts decision in Sony Corp. of America v Universal City Studios, Inc., ISP
platform technologies seemed to qualify for the safe harbour that Sony carved
out for technologies having substantial non-infringing uses.32
The telecom industrys chances for averting the strict liability rule
proposed in the White Paper were substantially enhanced by two pre-DMCA
developments. One was the Netcom decision, which rejected the White
Papers strict liability theory against ISPs.33 A second was an international
repudiation of a similar proposed strict liability rule for Internet intermediaries that the US had initially supported at the diplomatic conference that
28
Telecommunications Act of 1996, Pub. L. No. 104104, 110 Stat. 56. Title V
of this Act was the Communications Decency Act. The immunity provision is now
codified at 47 USC. 230(c)(1) (No provider or user of an interactive computer
service shall be treated as the publisher or speaker of any information provided by
another information provider.).
29
The rationale for this grant of immunity is discussed in Zeran v America
Online, 129 F.3d 327 (4th Cir. 1997).
30
47 USC. 230(e)(2). The Ninth Circuit has recently ruled that this limitation
on CDA immunity applies only to federal intellectual property laws. See Perfect 10,
Inc. v. CCBill LLC, 481 F.3d 751, 768 (9th Cir. 2007) (applying CDA immunity provision to state right of publicity claims).
31
See supra text accompanying n. 29 for the rationale for the CDA immunity.
32
Sony Corp. of Am. v Universal City Studios, 464 US 417, 442 (1984).
33
Religious Tech. Ctr. (RTC) v Netcom On-Line Commcn Servs., Inc., 907 F.
Supp. 1361, 1370 (N.D. Cal. 1995).
237
produced the WCT.34 An Agreed Statement on the treaty further clarified that
mere provision of physical facilities for enabling or making a communication
does not in itself amount to communication under the treaty.35 ISPs could
accordingly point to the international consensus against a strict liability rule
when arguing for a more balanced approach before Congress.
The Netcom decision was a pivotal development in the legislative drama
that spawned the DMCA safe harbours.36 In response to the copyright owners
direct infringement claim against Netcom, the alleged infringers Internet
access provider, Judge Whyte identified the question in the case as whether
possessors of computers are liable for incidental copies automatically made on
their computers using their software as part of a process initiated by a third
party.37 Judge Whyte decided that RTCs direct infringement theory was an
unreasonable interpretation of copyright law because it would logically lead to
imposing liability on owners of every single Usenet server in the worldwide
link of computers transmitting Erlichs message to every other computer.38
Before an Internet access provider could become directly liable, there needed
to be proof of some element of volition or causation, proof which is lacking
where a defendants system is merely used to create a copy for a third party.39
34
The Clinton Administration had supported a draft treaty provision under
which ISPs would have been strictly liable for temporary copies of infringing materials passing through their computers. See Samuelson, supra n. 4, at 38392 (discussing
debate over ISP liability at the WIPO diplomatic conference).
35
Agreed Statements, statement concerning Art. 8.
36
RTC, 907 F. Supp. at 136466. Litigation ensued after Dennis Erlich, a former
minister of the Scientology religion turned vocal critic, posted portions of the writings
of L. Ron Hubbard in the alt.religion.scientology Usenet newsgroup. RTC, owner of
the relevant copyrights, sued Erlich, Thomas Klemesrud (the operator of a bulletin
board service (BBS) on which Erlich had made the postings), and Netcom (the Internet
access provider for Klemesruds BBS), for copyright infringement. Id. at 1366.
37
Id. at 1368. In support of its direct infringement claim, RTC relied upon the
White Paper; the Ninth Circuits decision in MAI Systems Corp. v Peak Computer, Inc.,
991 F.2d 511 (9th Cir. 1993), which held that temporary copies of copyrighted works
made in the random access memory of computers were infringing reproductions of the
works unless authorized by the copyright owner or the law, id. at 518; and Playboy v
Frena, 839 F. Supp. 1552 (M.D. Fla. 1993), which held the operator of a BBS directly
liable for infringing copies of Playboy bunny pictures that users had uploaded to and
downloaded from the BBS. The White Paper had also relied upon MAI in support of its
view that making temporary as well as permanent copies of works in digital form were
copyright-significant acts and upon Frena in support of its view that ISPs were directly
liable for user infringements. See White Paper, at 6469, 120.
38
RTC, 907 F. Supp. at 1369.
39
Id. at 1370. Judge Whyte also granted Netcoms motion for summary judgment on RTCs vicarious liability claim. Although the judge was skeptical of Netcoms
claim that it lacked the ability to supervise and control users postings, the vicarious
238
Although Judge Whyte also agreed with Netcom that it should not be held
contributorily liable for Erlichs infringement before receiving notice about
this risk, he took issue with Netcoms assertion that RTCs notice of Erlichs
infringement was too equivocal given the difficulty in assessing whether
registrations are valid and whether a use is fair.40 While a mere unsupported
allegation of infringement by a copyright owner may not automatically put a
defendant on notice of infringing activity, Judge Whyte declared, Netcoms
position that liability must be unequivocal is unsupportable.41 Upon receipt
of a proper notice, Judge Whyte thought that Netcom should have a duty to
investigate the claim of infringement and to take the material down if the claim
was valid. Failure to do so amounted to a substantial contribution to user
infringement that, if proven, would justify contributory infringement liability.42
Two of the DMCA safe harbours are codifications of the Netcom ruling: s.
512(a) exempts service providers from liability for incidental copies made in
the course of network transmission of digital content on behalf of users;43 and
s. 512(c) exempts copies made in storing information for users except when
providers have received proper notice of infringement from the copyright
owner and failed to investigate the charges and remove infringing materials.44
Congress also created safe harbours for caching of digital content to enable
faster service to users and for information locating tools (for example, search
engines) that might connect users to infringing materials.45 The information
storage, caching, and information location tool safe harbours have notice and
takedown requirements akin to those articulated in Netcom.46
claim was unsustainable because Netcom had not received any direct financial benefit
from user infringements. Id. at 137577.
40
Id. at 1373. To require proof of valid registration would be impractical and
would perhaps take too long to verify, making it impossible for a copyright holder to
protect his or her works in some cases. . . . Id.
41
Id. at 1374.
42
Id. at 137475. There being a triable issue of fact on the adequacy of RTCs
notice to Netcom and the reasonableness of Netcoms response, the latters motion for
summary judgment on the contributory infringement claim failed. Id. The White Paper
had not considered a notice and takedown regime as a way to balance competing interests in ISP liability cases.
43
17 USC. 512(a).
44
Id. at 512(c).
45
Id. at 512(b) (caching safe harbour), 512(d) (information location tool
safe harbour). As mentioned above, the EU found notice and takedown to be a balanced
approach to ISP liability in its E-Commerce Directive, which, like the DMCA, provides
a safe harbour for transmission, caching, and information storage. It has no counterpart,
however, to s. 512(d). E-Commerce Directive, supra n. 16, Arts. 1214.
46
17 USC. 512(b)(2)(E)(i), (c)(1)(A), (d)(1)(A).
239
The DMCA safe harbours represented a major victory for telecom and
Internet industry groups, given that powerful copyright industry groups had
wanted service providers held strictly liable for infringing acts of users.
Other legislative concessions to ISPs included: a specification of what
constitutes adequate notice from copyright owners before the duty to investigate arises;47 a counter-notice regime so that users can ask to restore information initially taken down in response to a complaint of infringement;48 an
immunity for taking information down based on a good faith belief that such
action was proper;49 limitations on injunctive relief;50 and a clarification that
service providers were not obliged to monitor their sites for infringing materials.51
Copyright industry groups obtained some concessions as well. ISPs could
rely on the safe harbours only if they had adopted and reasonably implemented
policies to terminate repeat infringers, and if they accommodated standard
technical measures that might be developed in the future for the protection of
digital copyrighted works.52 ISPs were obliged to publicly designate an agent
to whom notices of infringement could be sent.53 The DMCA also authorized
copyright owners to seek subpoenas to require service providers to disclose
names and other identifying information about ISP subscribers whom copyright owners alleged were infringers.54
47
Id. at 512(c)(3). The Ninth Circuit gave this requirement some teeth in a
recent secondary liability case:
240
The DMCA safe harbours have generally been efficacious in run-of-themill copyright infringement cases involving users and their ISPs.55 Copyright
owners have incentives to monitor Internet sites for infringing materials and to
provide appropriately detailed information to ISPs so that the infringing material can be taken down. Copyright owners are deterred from sending false or
overreaching notices of infringement not only by provisions of the DMCA that
penalize wrongful notices,56 but also by the prospect of bad publicity and
judicial sanctions if they send improper or overreaching notices.57 ISPs have
incentives to cooperate with copyright owners in the notice and takedown
process and to terminate repeat infringers lest they forfeit the safe harbours
provided by the DMCA.
While there is some empirical evidence that ISPs are perhaps quicker than
they should be to take materials down upon receipt of notice and that the
counter-notice procedures are too rarely invoked,58 ISPs and copyright owners
have generally adapted to conducting businesses within the framework of the
notice and takedown regime of the DMCA safe harbours.59 Viacoms pending
copyright infringement lawsuit against YouTube will test how secure the
DMCA safe harbours really are,60 but it will not be surprising if the court tells
Viacom that it should take its complaint to Congress, as Viacom is essentially
trying to achieve through litigation what the copyright industry was unable to
obtain from Congress in 1998.61 Leaving aside the Viacom lawsuit, the past
55
See, e.g., Christian C.M. Beams (1999), Note: The Copyright Dilemma
Involving Online Service Providers: Problem Solved . . . For Now, 51 Fed. Comm.
L.J. 823, 846; Heidi Pearlman Salow (2001), Liability Immunity for Internet Service
Providers How Is It Working?, 6 J. Tech. L. & Poly 31, 4950.
56
17 USC. 512(f). This provision has some teeth, as is illustrated by Online
Policy Group v Diebold, Inc., 337 F. Supp. 2d 1195 (N.D. Cal. 2004) (sanctioning an
electronic voting technology firm for knowing misrepresentations when giving notice
to an ISP to take down allegedly infringing materials).
57
See e.g., Free Speech Battle Over Online Parody of Colbert Report,
http://www.eff.org/news/archives/2007_03.php#005176 (Mar. 22, 2007) (challenging
Viacom notice and takedown demand as to parody available on YouTube).
58
See e.g., Jennifer Urban and Laura Quilter (2006), Efficient Process or
Chilling Effects? Takedown Notices Under Section 512 of the Digital Millennium
Copyright Act, 22 Santa Clara Computer & High Tech. L.J. 621. For examples of
notice and takedown letters that have had chilling effects on users, see http://chillingeffects.org/copyright/.
59
See, e.g., Kevin M. Lemley (2003), Comment: Protecting Consumers From
Themselves: Alleviating the Market Inequalities Created by Online Copyright
Infringement in the Entertainment Industry, 13 Alb. L.J. Sci. & Tech. 613, 620.
60
See Complaint, Viacom Intl, Inc. v YouTube, Inc., No. 07 Civ. 2103 (S.D.N.Y.
12 March 2007).
61
See, e.g., CoStar Group, Inc. v LoopNet, Inc., 373 F.3d 544 (4th. Cir. 2004)
241
decade of experience with the DMCA notice and takedown regime suggests
that a relatively balanced and workable solution to this particular dual-use
technology problem has been found.62
Anti-circumvention Provisions
In addition to endorsing a strict liability rule against ISPs, the White Paper
anticipated that many copyright owners would find it desirable to use technical protection measures for digital media products or services intended for
distribution via global digital networks; yet, it also recognized that clever technologists could build tools to bypass these TPMs, which would thereby render
digital works vulnerable to infringements.63 To offer greater security to technically protected content, the White Paper recommended enactment of a ban
on technologies, the primary purpose or effect of which is to avoid, bypass,
remove, deactivate, or otherwise circumvent technical measures used by
copyright owners to protect their works.64
The White Paper offered very little policy analysis in support of this ban.65
(rejecting copyright owner arguments for intermediary liability as having been resolved
by DMCA safe harbors).
62
See, e.g., Beams, supra n. 55, at 841; Tim Wu, Does YouTube Really Have
Legal Problems?, Slate.com, 26 October 2006, http://www.slate.com/id/2152264/
(arguing that the content industry actually likes section 512 more than anyone will
admit). See also Michael L. Rustad & Thomas H. Koenig (2005), Rebooting
Cybertort Law, 80 Wash. L. Rev. 335, 397 (praising the balance of the notice and takedown rules).
63
White Paper, at 230.
64
The White Papers proposal was:
No person shall import, manufacture or distribute any device, product, or component incorporated into a device or product, or to offer or perform a service, the
primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without authority of the copyright owner or the law, any process,
treatment, mechanism, or system which prevents or inhibits the exercise of any of
the exclusive rights under section 106.
Id., Appendix 1 at 6.
65
The White Paper did state:
The Working Group finds that prohibition of devices, products, components, and
services that defeat technological methods of preventing unauthorized use is in the
public interest and furthers the Constitutional purpose of copyright laws.
Consumers of copyrighted works pay for the acts of infringers; copyright owners
have suggested that the price of legitimate copies of copyrighted works may be
higher due to infringement losses suffered by copyright owners. The public will also
242
It dismissed as misguided expressions of concern about the effects of anticircumvention rules on the public domain and on fair and other privileged uses
of copyrighted works.66 Clinton Administration officials also proposed that a
virtually identical provision should be included in the WCT.67
The Sony Safe Harbour was the pre-DMCA default rule for dual-use
technologies
The radical nature of the White Papers proposed anti-circumvention rule can
best be appreciated by contrasting it with the safe harbour for technologies
with substantial non-infringing uses set forth in Sony Corp. of America v
Universal City Studios, Inc.68 Sony was the first case to consider whether
copyright owners could hold technology developers indirectly liable for user
infringements on the ground that the primary purpose or effect of the challenged technologies was to facilitate unauthorized copying of copyrighted
works.69
Universal sued Sony for contributory infringement in 1976, shortly after
Sony introduced the Betamax video tape recorder (VTR) to the market, claiming that Sony knew that the primary use of its Betamax machines would be to
make unauthorized, and hence infringing, copies of copyrighted works, such
as movies shown on broadcast television.70 Indeed, Sonys advertisements
encouraged the public to purchase its VTRs in order to copy favourite
programs.71 In 1981, the Ninth Circuit Court of Appeals ruled in Universals
favour, on the grounds that making copies of copyrighted television
programmes, even for time-shifting purposes, was direct infringement, and
that Sony had knowingly contributed to that infringement because the primary
have access to more copyrighted works if they are not vulnerable to the defeat of
copy protection systems.
Id. at 230.
66
Id. at 23132.
67
See Samuelson, supra n. 4, at 40915 (discussing proposed WIPO treaty anticircumvention provision).
68
Sony Corp. of Am. v Universal City Studios, Inc., 464 US 417 (1984). The
White Paper did not mention that its anti-circumvention rule would partially overturn
the Sony safe harbor for technologies with substantial non-infringing uses. The White
Paper mischaracterized Sony as a case in which the absence of a market for hometaping had led the Court to conclude that time-shift copying of television programs was
fair use. White Paper, at 79.
69
For a well told history of the lawsuit, see generally James Lardner, Fast
Forward: A Machine and the Commotion It Caused (rev. ed. 2002).
70
Sony, 464 US at 459.
71
Id.
243
use of Betamax machines was to make such copies.72 In 1984, the Supreme
Court reversed, holding that time-shift copying of TV programmes was fair use
and that Sony was not liable for contributory infringement on account of the
substantial non-infringing uses to which the Betamax machines could be put.73
Justice Stevens, writing for the Court in Sony, observed that the only theory
on which Sony could be held liable was that [it has sold] equipment with
constructive knowledge that its customers may use that equipment to make
unauthorized copies of copyrighted material.74 There was, however, no
precedent for imposition of [secondary] liability on such a theory,75 nor any
basis in the copyright statute.76 Holding Sony liable on this theory was unwarranted, moreover, because of the significant effects it would have on other
parties, including copyright owners who approved of time-shift copying of
their programmes by Betamax users, members of the public who wanted
access to such technologies to make authorized and fair uses of them, and of
course, Sony and other technology developers who wanted to make and sell
these technologies.77 When a charge of contributory infringement is predicated entirely on the sale of an article in commerce that is used by the
purchaser to infringe [an intellectual property right], the public interest in
access to that article is necessarily implicated.78
Sony recognized that Congress had resolved a similar tension in patent law
by imposing contributory liability on technology developers only when they
made and sold devices that had been especially made or especially adapted
72
Universal City Studios, Inc. v Sony Corp. of Am., 659 F.2d 963, 971-72 (9th
Cir. 1981).
73
Sony, 464 US at 44756.
74
Id. at 439.
75
Id.
76
Justice Stevens pointed out that US copyright law does not expressly render
anyone liable for infringement committed by another. Id. at 434. Universal argued that
Kalem [Co. v Harper Bros., 222 US 55 (1911)] stands for the proposition that supplying the means to accomplish an infringing activity and encouraging that activity
through advertisement are sufficient to establish liability for copyright infringement.
Sony, 464 US at 436. This was, Justice Stevens opined, a gross generalization that
cannot withstand scrutiny. Id.
77
Id. at 43442.
78
Id. at 440. This statement was particularly significant because by the time the
Court heard oral argument in Sony for the second time, 9.5 million American households had Betamax machines; under Universals theory, virtually every Betamax user
was a copyright infringer, and Sonys potential liability was vast. Counsel for Sony led
off his oral argument with this fact. See Jessica Litman (2005), The Sony Paradox, 55
Case W. Res. L. Rev. 917, 940. The potential for statutory damages for which Sony
and/or owners of Betamax machines might be liable if Universals theory was accepted
was staggeringly large.
244
35 USC. 271(c).
Id. For a highly informative discussion of the case law on the staple article of
commerce rule, see Donald S. Chisum, Chisum on Patents 17.03 (2004).
81
Sony, 464 US at 439. For an argument that the Court was justified in borrowing this rule from patent law, see, for example, Brief of Amici Curiae of Sixty
Intellectual Property and Technology Law Professors and US-ACM Public Policy
Committee, to the US Supreme Court in MGM v Grokster, 20 Berkeley Tech. L.J. 535
(2005) [hereinafter IP Professor Amicus Brief]. But see Peter S. Menell and David
Nimmer (2007), Unwinding Sony, 95 Cal. L. Rev. 941, 985 (questioning the historic
kinship justification).
82
Sony, 464 US at 442.
83
Id.
84
Id. at 456.
85
See e.g., Pamela Samuelson (2006), The Generativity of Sony v. Universal:
The Intellectual Property Legacy of Justice Stevens, 74 Fordham L. Rev. 1831,
185051 (discussing the legacy of Sony).
86
Litman, supra n. 78, at 951. There is considerable support for the Sony safe
harbour among academics as well as among technology developers. See e.g., IP
Professor Amicus Brief, supra n. 81; Brief of Intel Corp. as Amicus Curiae Supporting
Affirmance, Metro-Goldwyn-Mayer Studios, Inc. v Grokster, Ltd., 545 US 913 (2005)
(No. 04-480), available at http://www.eff.org/IP/P2P/MGM_v_Grokster/
20050301_intel.pdf [hereinafter Intel Amicus Brief]. However, there are also some critics. See e.g., Menell and Nimmer, supra n. 81; Douglas Lichtman and William Landes
(2003), Indirect Liability for Copyright Infringement: An Economic Perspective, 16
Harv. J. L. & Tech. 395.
245
producers greatly benefited from the installed base of Betamax and other
VTRs, which created opportunities for a wholly new lucrative market for
copyrighted motion pictures, such as the sale of video cassettes of movies that
could be played in VTR machines.87 Many other new technologies, including
notably the iPod, have similarly allowed both information technology and
copyright industries to achieve mutual success.88
Although Congress has been persuaded on two occasions to deviate from
the Sony safe harbour in very narrowly drawn circumstances,89 it has rejected
other legislative proposals aimed at giving copyright owners greater control
over dual-use technologies.90 Courts have also denied relief to some who
sought to expand technology developer liability.91 Yet, when presented with
technologies lacking in substantial non-infringing uses, courts followed Sony
and imposed liability for infringements thereby enabled.92
The White Paper had sought to establish a new rule for technology developer liability with respect to so-called circumvention technologies based on
the primary use of the technology.93 This approach resembled the technology
developer liability rule that the Supreme Court rejected in Sony as too unbalanced. Soon after enactment of the DMCA, the entertainment industry
commenced litigation against peer-to-peer (P2P) file-sharing software developer Napster with the aim of overturning the Sony safe harbour for technologies with substantial non-infringing uses.94 In cases against P2P file-sharing
87
88
89
246
technology developers, the entertainment industry once again urged the courts
to adopt a primary use theory of technology developer liability for user
infringements.95 Part III will discuss why the latter effort was unsuccessful,
but for now, it suffices to say that the White Paper proposal for regulating technologies based on their primary purpose or use was a radical departure from
the Sony safe harbour default rule in place since 1984.96
95
247
Id. at 523.
See Samuelson, supra n. 4, at 409416 (discussing opposition to the proposed
WIPO treaty anti-circumvention provision).
100
Id.
101
WCT, supra n. 1, art. 11.
102
See H.R. 3048, 105th Cong., 8 (1997).
103
See, e.g., Chander, supra n. 18, at 20607 (discussing stronger than DMCA
anti-circumvention rules being negotiated by the U.S. in free trade agreements with
other nations).
104
17 U.S.C. 1201(a)(3).
105
Id.
248
106
107
108
109
110
111
112
249
250
explain why the bill distinguished between these two types of TPMs, nor why
it proposed totally banning circumvention of access controls, but not of other
TPMs.
A coalition of organizations, including libraries, educational institutions,
and other non-profit organizations raised concerns about the direct impact that
such a ban would have on fair and other non-infringing uses of copyrighted
works in digital form, on access to public domain materials, and on user
privacy interests.119 These concerns did not, however, arouse Congressional
interest as much as concerns about overbroad ISP liability. This relative indifference may be explained in part perhaps because the lobbying clout of these
nonprofits was minute in comparison with the heft of the copyright, telecom,
and technology industries that lobbied about ISP liability. Furthermore,
deployment of TPMs to protect copyrighted works was in its early stages, so
concerns about impediments to fair and other privileged uses may have
seemed speculative.120
Yet, if one knows where to look, there is considerable evidence of
Congressional concern about enabling public interest uses of technically
protected content. By regulating circumvention of access controls, but not of
rights controls,121 Congress decided, albeit implicitly, that circumvention for
fair use and other public interest purposes should remain lawful. Congress also
created three special public interest exceptions, including one for libraries,
archives, and educational institutions to bypass TPMs to make a good faith
effort to decide whether to buy the content protected by the TPM if circumvention was necessary to achieve this objective;122 one that aims to protect
user privacy interests implicated when content is protected by TPM; and one
that buttresses parental control over minors.123
119
See WIPO Copyright Treaties Implementation Act and On-Line Copyright
Liability Limitation Act: Hearing on H.R. 2281 and H.R. 2180, Before the Subcomm.
on Courts and Intellectual Property of the House Comm. on the Judiciary, 105th Cong.
(1997) (testimony of Robert Oakley; testimony of M.R.C. Greenwood).
120
The important role of the House Commerce Committee in inserting some
balance in the anti-circumvention rules is related in Samuelson, supra n. 14, at 54143.
121
17 USC. 1201(a)(1)(A). See Ginsburg, supra n. 14, at 6 (noting that section
1201 does not prohibit the act of circumventing a rights control). Ginsburg believes
that the decision not to regulate circumvention of rights controls was intended to leave
room for fair uses of technically protected works. Id. at 10.
122
17 USC. 1201(d).
123
Id. at 1201(h), (i). These provisions are, however, a puzzlingly narrow
response to concerns expressed about the anti-circumvention ban. See e.g., Samuelson,
supra n. 14, at 53753 (explaining the undue narrowness of s. 1201s exceptions);
David Nimmer (1999), Puzzles of the Digital Millennium Copyright Act, 46 J.
Copyright Socy 401 (1999), available at http://ssrn.com/abstract=208876.
251
17 USC. 1201(c)(1).
See e.g., 144 Cong. Rec. H7093 (daily ed. Aug. 4, 1998) (statement of Rep.
Bliley) (indicating that the Commerce Committee understood the DMCA legislation to
enable consumers to exercise their historical fair use rights).
126
17 USC. 1201(a)(1)(C).
127
Id.
128
111 F. Supp. 2d 294 (S.D.N.Y. 2000).
129
Id. at 322.
130
Universal City Studios, Inc. v Corley, 273 F.3d 429, 443 (2d Cir. 2001). But
see Chamberlain Group, Inc. v Skylink Techs., Inc., 381 F.3d 1178, 1200 (Fed. Cir.
2004) (regarding s. 1201(c)(1) as a fair use savings clause).
252
Both the trial court and the Second Circuit considered the triennial rulemaking and the narrowly drawn public interest exceptions to s. 1201 as
adequately accommodating fair use and other public interests pertaining to
technically protected works.131 Judge Kaplan characterized the argument that
purchasers of DVD movies have the right to circumvent CSS so long as they
do not infringe copyrights in DVD movies as pure sophistry and as a corruption of the first sale doctrine.132 According to Judge Kaplan, the DMCA anticircumvention laws fundamentally altered the landscape of copyright as to
technology provider liability.133
Seemingly without realizing it,134 Judge Kaplan arguably also closed off
another possible public interest safety valve in the DMCA by construing DeCSS
as a tool for circumventing access controls. If CSS is indeed an access control,
then bypassing it would violate s. 1201(a)(1)(A). Insofar as TPMs, such as CSS,
are deemed access controls within the meaning of s. 1201, the public interest
circumventions that the DMCA was supposed to accommodate by not regulating circumvention of non-access-control TPMs have arguably been foreclosed.
Copyright owners have apparently recognized that they may be able to defeat
some public interest limitations on the scope of the anti-circumvention rules by
adopting persistent access controls as their TPMs of choice.135
Given the hostility that Reimerdes and Corley displayed toward fair use as
a limitation on the scope of s. 1201, the next most plausible candidate for an
accommodation of public interest uses of digital content protected by TPMs
would seem to be the LOC rulemaking procedure. However, this procedure is
not a sufficient safety valve for several reasons.
First, it only occurs every three years, and any exceptions created only last
for three years.136 Secondly, it is largely focused on exempting classes of works
rather than classes of uses, although classes of uses are more relevant when
assessing public interest uses.137 Thirdly, proposals for exemptions can only be
made during the rulemaking process, and a heavy burden of proof has been put
131
132
133
134
253
138
254
145
See 37 C.F.R. 201.40. For a discussion of the latest rulemaking, see, for
example, Ginsburg, supra n. 14, at 1217. Ginsburg notes that the film teacher exception departs significantly from prior rule-makings. Id. at 1213.
146
For example, an evidence professor might want to bypass CSS in order to take
clips from movies about trials to show his class how to (and not to) make objections,
while a psychology professor might want to make fair use clips of movies to demonstrate
how mentally ill people are depicted. We are hopeful that a judge with a broad view of
17 USC. 1201(c)(1) might analogize these and similar fair use circumventions to the
exemption granted by the LOC, but there is as yet no precedent for doing so.
147
Ginsburg, supra n. 14, at 16.
148
See e.g., Armstrong, supra n. 14, at 68; Benkler, supra n. 14, at 42027;
Lipton, supra n. 14, at 12436; Perzanowski, supra n. 142, at 1718.
149
Professors Burk and Cohen have proposed requiring deployers of TPMs to
make unlocking technologies available to enable fair uses by third party escrow agents.
Burk and Cohen, supra n. 14, at 6567. Professor Lipton has proposed that the
Copyright Office establish an administrative procedure to assist prospective fair users
of TPM content. Lipton, supra n. 14, at 124.
150
See e.g., Reese, supra n. 135, at 66364.
151
See e.g., Ginsburg, supra n. 14, at 2122; Samuelson, supra n. 14, at 53945.
152
Dan L. Burk (2003), Anticircumvention Misuse, 50 UCLA L. Rev. 1095.
255
256
158
See Brief for Motion Picture Studio and Recording Company Petitioners,
Metro-Goldwyn-Mayer Studios v. Grokster Ltd., 545 US 913 (2005) (No. 04-480),
available at http://www.eff.org/IP/P2P/MGM_v_Grokster/04-480_Petitioners_
brief.pdf [hereinafter MGM Brief]. Recall that the Court had rejected, albeit only just
barely so, a primary use test for indirect liability for copyright infringement in the Sony
case. See supra n. 73 and accompanying text. Section 1201 adopts a variant on the
primary use test for circumvention technology liability. While in theory a primary
purpose or design test, as in the DMCA, is more rigorous than the primary use test
for which Universal argued in Sony, we are skeptical about how different they would
be in practice, given that when a technology is primarily used for an illicit purpose, a
challenger of that technology will almost certainly argue that the technology must have
been designed to facilitate these illicit uses and that any testimony about beneficial
purposes for the design are self-serving misrepresentations to avoid liability. See IP
Professor Amicus Brief, supra n. 81, at 55961.
159
See e.g., MGM Brief, supra n. 158, 1820.
160
The many amicus briefs filed in support of MGMs appeal are available at
http://www.eff.org/IP/P2P/MGM_v_Grokster/.
161
Grokster, 545 US at 937.
162
Id. at 920 (Given [their] benefits in security, cost, and efficiency, peer to peer
networks are employed to store and distribute electronic files by universities, governmental agencies, corporations, and libraries among others.).
163
Chamberlain Group, Inc. v Skylink Techs., Inc., 381 F.3d 1178 (Fed. Cir. 2004).
164
Lexmark Intl, Inc. v Static Control Components, Inc., 387 F.3d 522 (6th Cir.
2004).
257
258
content. The lock-out cases, in our view, set the stage for judicial development
of the reverse notice and takedown procedure we endorse in this chapter.
The Dissemination Technology Cases: Napster, Aimster, and Grokster
In approaching the dissemination technology cases and the controversies they
have provoked, we offer some preliminary observations. First, there are very
few privileged public interest uses directly at stake when consumers use P2P
file-sharing technologies to download entire musical works and sound recordings without payment to authors, artists, and recording studios. Unless one
believes that copyrights are an inherently illegitimate form of property, one
cannot readily defend the limitless free-riding on copyrighted works that P2P
file sharing has engendered in terms of traditional exceptions to copyright
protection.168
One may lament the demise of any equivalent of the first sale doctrine in
the online environment,169 and one may castigate record companies for clinging too long to outdated business models, without viewing the downloaders as
principled defenders of the public interest. Had the DMCA not so shamelessly
sacrificed the public interest provisions of copyright law on the altar of
TPMs,170 few copyright law professors would express so much alarm about
the cases expanding third-party liability for contributory and vicarious
infringement.171
What alarms the critics is precisely the potential capacity of the dissemination technology cases, if mishandled by the courts, to exacerbate the imbalance found in the DMCAs anti-circumvention rules and thereby to further
reduce the bona fide and legitimate rights of users, improvers, competitors,
and the public at large. From this perspective, every expansion of third-party
168
Some have argued that the public interest might better have been served by a
liability rule than a property rule in response to the P2P file-sharing phenomenon, that
is, by grant of a compulsory license to allow file sharing of copyrighted works for
noncommercial purposes. See e.g., William W. Fisher III (2004), Promises to Keep:
Technology, Law and the Future of Entertainment; Neil Weinstock Netanel (2003),
Impose a Noncommercial Use Levy to Allow Free Peer-to-Peer File Sharing, 17
Harvard J. L. & Tech. 1; see generally J. H. Reichman (2000), Of Green Tulips and
Legal Kudzu: Repackaging Rights in Subpatentable Innovation, 53 V and. L. Rev. 1743
(theory of compensatory liability regime). This would have ensured that revenues
would flow back to the composers, performers, and producers of sound recordings
while also ensuring that the works were widely distributed.
169
17 USC. 106(3), 109 (2000).
170
See e.g., Litman, supra n. 26, at 12245.
171
See e.g., IP Professor Amicus Brief, supra n. 81, at 55657 (expressing
concern about expansion of technology developer liability rules).
259
liability in this group of cases could potentially further inhibit the already
limited range of public interest exceptions to copyright protection. Perhaps
worst of all, it could further undermine the incentives to invest in technologies
needed for the sharing of information goods for legitimate and important
public-good purposes.172
The validity of these concerns must, however, be tested against the actual
holdings in these cases. Napster, Aimster, and Grokster operated online
services that supplied P2P technologies to enable users of their software to
search for digital files of commercially distributed copyrighted works on other
users computers, connect directly to the other users computers in order to
make copies of the desired files, and transfer the copies to the requesting
users computers.173 The principal defence of these P2P developers against
charges of secondary liability for copyright infringement was that they qualified for the Sony safe harbour for technologies with substantial non-infringing
uses,174 although Napster also raised two DMCA ISP safe harbour
defences.175
Napsters Sony defence characterized the downloading of MP3 files authorized by new artists, the sampling of songs users planned to buy if they liked
them, and the archival copying of sound recordings users already owned as
substantial non-infringing uses of its technology.176 Because of the massive
amounts of infringement taking place through use of these P2P services, the
entertainment industry plaintiffs argued that the Sony safe harbour should not
be available for services, or alternatively, that it should only be available if
the primary use of the challenged technology was non-infringing, as in
Sony.177 Another reason to sue this P2P service was that it was easier and
172
260
more effective to shut down Napster than to sue the millions of people who
illegally traded files on Napster.178
Napster was hardly a neutral ISP providing a vehicle for innocent transmissions of honest exchanges of information or opinions. Yet, it nonetheless
claimed immunity under the s. 512(a) safe harbour for Internet transmissions
initiated by others179 and the s. 512(d) safe harbour for information locating
tools.180 The courts in Napster rejected its statutory safe harbour defences.181
Although Napsters network was capable of some non-infringing uses, the fact
remained that, as the Ninth Circuit observed, Napster knew or should have
known that massive infringements were underway, and its business success
depended on encouraging these infringements.182 In hindsight, Napsters
claim to shelter under the Sony safe harbour was undermined by its active
inducement of infringement, as the Supreme Court later phrased it in
Grokster.183
The court in Napster seemed self-consciously to draw parallels between
contributory infringement and the safeguards established for ISPs under s. 512
by suggesting that a system operator could avoid liability by purging infringing materials when it knew or should have known about them.184 Obviously,
178
Lemley and Reese, supra n. 137, at 1349. Lichtman and Landes argue that
suing third parties instead of the actual direct infringers can be efficient when the
former, although only indirectly responsible, are typically in a good position to either
prevent copyright infringement or pay for the harm it causes. See Lichtman and
Landes, supra n. 86, at 409.
179
Napster II, at *6*8 (ruling on Napsters s. 512(a) defense).
180
Napster, 114 F. Supp. 2d at 919 n. 24. Napster argued that absent notice from
the copyright holder, it had no way of knowing which transfers were infringing transfers. Brief for Defendant-Appellant Napster, Inc. at 52, A&M Records, Inc. v Napster,
Inc. 114 F. Supp. 2d 896 (N.D. Cal. 2000) (Nos. 00-16401 and 00-16403), available at
http://www.eff.org/IP/P2P/Napster/brief0818.pdf.
181
Napster II, supra n. 158, at *6*8 (rejecting a s. 512(a) defence); Napster,
114 F. Supp. 2d at 919 n. 4.
182
Napster, 239 F.3d at 1020 n. 5.
183
See Metro-Goldwyn-Mayer Studios Inc. v Grokster Ltd., 545 US 913, 93638
(2005).
184
The Ninth Circuit Court of Appeals stated that if a computer system operator
learns of specific infringing material available on his system and fails to purge such
material from the system, the operator knows of and contributes to direct infringement. Napster, 239 F.3d at 1021 (quoting Religious Tech. Ctr. (RTC) v Netcom OnLine Commcn Servs., Inc., 907 F. Supp. 1361, 1374 (N.D. Cal. 1995)). The Ninth
Circuit invoked Sony, where the Supreme Court held that if liability had to be imposed,
it must rest on the fact that they have sold equipment with constructive knowledge of
the fact that their customers may use that equipment to make unauthorized copies of
copyrighted material. Id. at 1020 (quoting Sony Corp. of Am. v Universal City Studios,
Inc., 464 US 417, 439 (1984) (emphasis added)). Although the Supreme Court in Sony
261
did not clarify what could qualify as constructive knowledge, the Court in Napster
found that the company had materially contributed to the direct infringement committed by end users, since it had provided them with the site and the facilities without
which copyright violations could not have been committed. Napster, 239 F.3d at
102223.
185
Id.
186
Napster, 239 F.3d at 1016.
187
See Sony Corp. of Am. v Universal City Studios, Inc., 464 US 417 (1984).
188
See e.g., Lardner, supra n. 69, at 297313.
189
See e.g., IFPI, Digital Music Report 2007, at 4 (2007), available at
http://www.ifpi.org/content/library/digital-music-report-2007.pdf (Digital music sales
are estimated to have almost doubled in value worldwide in 2006, reaching an estimated trade value of around US $2 billion).
190
In re Aimster Copyright Litigation, 334 F.3d 643, 651 (7th Cir. 2003).
191
Id. at 646.
192
Id. at 650.
193
Id. at 65152.
262
263
drew upon another complementary patent law doctrine that disallowed the safe
harbour if the defendant had actively induced copyright infringement.200
Using this approach, neither the relative degrees of remoteness or of the material contribution in the three cases, nor the relative weights of some potential
non-infringing uses allegedly rising to a possible 10 percent of all uses in
Grokster could vindicate a Sony defence if the underlying intent of the operation was to actively induce copyright infringement.201
While some contend that this resolution will unduly chill innovation in
dual-use technologies,202 we have a more optimistic assessment of what
Grokster accomplished. The Grokster decision rejected several proposals to
limit the scope of the Sony safe harbour. It did not, for instance, exclude
services, as such, from the Sony safe harbour. It did not adopt any particular
standard of intolerable infringing uses. Moreover, it did not adopt a primary
use test for judging the lawfulness of dual-use technologies.203 The Court
preserved the safe harbour for technologies with substantial non-infringing
uses and focused instead on evidence of actions that demonstrated active and
intentional promotion of infringement, which disqualified the defendants from
the shelter of copyrights variant on patent laws staple article of commerce
limitation.204
The extent to which suppliers of dual-use technologies may still benefit
from a Sony safe harbour remains to be worked out in future cases, and care
must be taken not to impair or undervalue actual non-infringing uses where
they occur in a good faith context. Over time, however, it has become clear
that the recording industry cannot cling to obsolete business models that
oblige consumers to purchase music they do not want, and that this industry
cannot attain control over P2P technology. Rather, as the district court in
Napster correctly foresaw, shutting down firms such as Napster effectively
200
201
264
205
206
207
208
See A&M Records, Inc. v Napster Inc., 239 F.3d 1004, 1016 (9th Cir. 2001).
17 USC. 512, 1201 (2000).
17 USC. 102(a), 107122 (2000).
See e.g., Jonathan Band (2005), The Google Print Library Project: A
Copyright Analysis, J. of Internet Banking and Com. (December 2005) (discussing
projects to digitize public domain and copyrighted works in major library collections).
In theory, anti-circumvention liability should not lie for public interest users who
bypass TPMs to gain access to public domain works. However, if publishers use the
same TPM to protect copyrighted and public domain works, then any tool that would
bypass this TPM will arguably be illegal under s. 1201 because of the copyrighted
material also being protected by it.
265
Napster, Aimster and Grokster, and allow courts to think positively about the
need to balance public and private interests, as they traditionally sought to do
in the pre-digital era.209 Only when defendants begin to appear in a good faith
posture can we really discern what is at stake when the courts make appropriate judgments about the publics interest in access to technologies capable of
substantial non-infringing uses.
Of course, P2P systems such as Napster, Aimster and Grokster could not
long survive in such an atmosphere because they depend, directly or indirectly,
on benefits derived from infringing uses. Private foundations, public entities,
and public-private partnerships have already found good reasons to establish
P2P file-sharing networks to promote access to information goods for noninfringing public interest purposes. For example, Creative Commons has
established such networks for specific subject matter groupings,210 and scientific efforts to link databases in virtual archives through P2P technologies211
are growing in number.212 Science Commons, an affiliate of Creative
Commons, has unveiled plans to vigorously employ such technologies in a
number of major projects.213
These initiatives are likely to increasingly rely on P2P technologies to
enable participants to access and share privately held materials, whether copyrighted or not, that have been voluntarily made available to advance the goals
of the different user communities in question. Because such communities are,
209
266
as a rule, loosely organized and administered, they cannot and should not be
charged with the duties of policing the contents of materials made available to
the community for copyright infringement. Fortunately, so long as such groups
take pains to position their networks within the penumbra of s. 512 of the
DMCA, they can obtain all the sharing advantages of P2P systems while
largely immunizing themselves from liability for copyright infringement by
virtue of the notice and takedown procedures that this provision sets up.214
Moreover, s. 512 procedures allow systems managers to vet any infringement claims lodged against participating contributors and to refuse to comply
with a takedown request if they choose to back their members claim of privileged use against an outsiders claim of infringement.215 Even in a worst case
scenario, where the outsiders infringement claim ultimately prevails in a court
of law, the public interest goals of the user community should encourage
courts in this situation to narrowly tailor injunctions so as to avoid inhibiting
any legitimate non-infringing uses.216
The notice and takedown modalities of s. 512 thus make it possible to
keep P2P networks running for non-profit public interest purposes. Moreover,
the clean hands legitimacy of the enterprise should at least ensure that no
injunction otherwise affecting some infringing uses of the technology in question would shut down or impede such public interest initiatives. Nor is there
anything in the Supreme Courts Grokster decision that creates an insuperable
barrier to entry for launching these initiatives.217
Yet, once a public interest P2P file-sharing network is up and running,
problems may arise insofar as the technology allows community members to
link to external non-member ISPs where copyrighted works have been
deposited on conditions that restrict use or reuse of the material available
there. A risk of conflict exists between the search potential of the software to
enable non-infringing uses of posted material and the obligations of the
service provider to respect the dictates of the copyright owners it hosts on its
site. However, assuming that the service provider was covered by s. 512 of the
DMCA, this conflict could normally be resolved by notice and takedown
provisions with which we are familiar.
214
215
216
267
Under s. 512, all of the standard copyright exceptions and defences are
preserved even after the notice and takedown machinery superimposed upon
them has been triggered. If the information locating tool triggers an objection
from the copyright owner, the searcher can respond by asserting the noninfringing uses (for example, fair uses) that he intends to make of the protected
work in question. If the copyright owner acquiesces, the problem is solved. If
not, the putative fair user can seek a declaratory judgment to remove the obstacle and vindicate the non-infringing use.
Clearly, these legal modalities would benefit from expeditious administrative procedures to promptly resolve such disputes at low cost, with deferred
removal to courts only for specific issues that merited a full dress trial.218 Our
point is that, so long as we are dealing with traditional copyright defences, s.
512 of the DMCA poses no serious barriers to entry for our putative public
interest initiative.
How public interest uses may be frustrated by section 1201
Serious problems may arise, however, when copyright owners surround information products available on their websites with technological fences specifically designed to thwart, for example, the search and sharing capabilities of
the non-infringing, would-be public interest users.219 TPM fences may
initially prevent searchers from gaining access for the purpose of browsing
contents in order to identify material of interest.220 The same fences may then
direct would-be non-infringing users to an electronic gateway, where electronic contracts of adhesion will condition entry on a waiver of all the users
rights that our putative searchers might otherwise put forward to justify access
to and use of the information product in question.221 The electronic fence will
218
219
268
thus separate access from use. Insofar as s. 1201(c) permits circumvention for
privileged purposes,222 this will arguably only kick in after lawful access has
been gained. Yet, by then, user rights may have been abrogated by contract,
and it may already be too late to hack through the electronic fence prohibited
by s. 1201.223
Ironically, this scenario inverts the situation found in cases such as Napster,
Aimster, and Grokster where facilitators of mass infringements sought to hide
behind potential non-infringing uses. Here, instead, bona fide non-infringing
users risk being thwarted by copyright owners who use access control TPMs
to disable privileged uses.
By using TPMs, copyright owners arguably gain the power to opt out of
those parts of the copyright system they dislike. They cannot only design
TPMs to circumvent public interest uses, but can claim shelter behind s. 1201
for doing so. Because some cases have construed s. 1201 as abrogating fair use
and other public interest exceptions as grounds for circumventing TPMs to
extract non-infringing material, the public interest goals of the non-infringing
user may be absolutely defeated by the TPM.224 The DMCA does not explicitly allow circumvention for legally permissible purposes, although this would
have been consistent with the WCT and seems to have been the intent of some
in Congress.
From this perspective, s. 1201 arguably functions as a form of active
inducement to avoid the public interest exceptions embodied in the Copyright
Act. Copyright owners employ TPMs and s. 1201 protections in order to
thwart infringing uses of their works. However, TPMs may protect against all
unauthorized uses, both infringing and non-infringing. Although it is technically difficult to differentiate between these two classes of uses prospectively,
firms could do more to facilitate some public interest uses of technically
protected content if they chose to do so. There is as yet no incentive for copyright owners or TPM vendors to fine tune TPMs to enable non-infringing
uses.225
Thus, unless there is a way for s. 1201 to be construed to recognize the
legitimacy of access to enable non-infringing uses, the statute could become a
222
See supra nn. 121127 and accompanying text for a discussion of s. 1201 and
privileged uses.
223
17 USC. 1201 (2000).
224
See Ginsburg, supra n. 14.
225
One interesting experiment in designing TPMs with fair use in mind is the
open source digital rights management technology that Sun Microsystems is developing for digital content that would enable many fair uses. See Gerard Fernando et al.,
Project DReaM, An Architectural Overview (September 2005), http://www.
openmediacommons.org/collateral/DReaM-Overview.pdf.
269
270
not take long for some technology developers to realize that these rules, as
interpreted in Reimerdes, were susceptible to use as a tool for defeating
competition in the market for uncopyrightable products and services.233
Technology developers Lexmark, Chamberlain, and Storage Technology
Corp. (StorageTek) relied on Reimerdes in claiming that the DMCAs anticircumvention rules conferred on them the right to control access, through
digital lock-out codes, to software embedded in their products so as to prevent
competitors from supplying after-market replacement parts or services.234
The lock-out technology cases
Lexmark, a manufacturer of printers and toner cartridges, claimed that the
authentication protocol (or digital handshake) component of copyrighted
computer programs installed on chips in its printers and toner cartridges was
an access control, the bypassing of which violated s. 1201(a)(1)(A).235
Because Static Control made chips designed and produced to bypass this
access control, Lexmark charged it with violating s. 1201(a)(2).236 Static
Controls customers were manufacturers of toner cartridges designed to work
in Lexmark printers. The trial court, relying heavily on Reimerdes, issued a
preliminary injunction against Static Controls manufacture of these chips.237
The Sixth Circuit eventually reversed, seemingly on the ground that the
DMCA does not apply to digital fences limiting access to functional aspects of
the printers.238 The courts reasoning on the anti-circumvention claim is,
233
See e.g., Pamela Samuelson and Suzanne Scotchmer (2002), The Law and
Economics of Reverse Engineering, 111 Yale L.J. 1575, 164249 (predicting technology developer misuses of the DMCA rules).
234
Lexmark Intl, Inc. v Static Control Components, Inc., 387 F.3d 522 (6th Cir.
2004); Chamberlain Group, Inc. v Skylink Techs., Inc., 381 F.3d 1178 (Fed. Cir. 2004);
Storage Tech. Corp. v Custom Hardware, Engg & Consulting, Inc., 421 F.3d 1307
(Fed. Cir. 2005).
235
Lexmark, 387 F.3d at 52832. Static Control successfully challenged the
validity of the copyright in the toner cartridge software because it was a short program
with limited functionality and copying was necessary in order to make compatible
cartridges capable of running on Lexmark machines. Id. at 53542.
236
Id. at 531.
237
Lexmark Intl, Inc. v Static Control Components, Inc., 253 F. Supp. 2d 943
(E.D. Ky. 2003).
238
The court observed:
In the essential setting where the DMCA applies, the copyright protection operates
on two planes: in the literal code governing the work and in the visual or audio
manifestation generated by the codes execution. For example, the encoded data on
CDs translates into music and on DVDs into motion pictures, while the program
commands in software for video games or computers translate into some other
271
272
Commerce Committee concluded that 1201 fully respects and extends into the
digital environment the bedrock principle of balance in American intellectual
property law for the benefit of both copyright owners and users.243
It consequently rejected the notion that the DMCA had created a new exclusive right in copyright owners to control access to their works.244 Section 1201
should instead be viewed as providing copyright owners with a new cause of
action when circumvention of access controls threatened their ability to
enforce their exclusive rights under copyright law.
In its search for a more balanced interpretation of the DMCA, the court
considered at length linkages between the anti-circumvention rules and rights
conferred by copyright law:
Statutory structure and legislative history both make clear that 1201 applies only
to circumventions reasonably related to [copyright] protected rights. Defendants
who traffic in devices that circumvent access controls in ways that facilitate
infringement may be subject to liability under 1201(a)(2). . . . [D]efendants
whose circumvention devices do not facilitate infringement are not subject to
1201 liability.245
To the extent that Reimerdes said otherwise, the Federal Circuit disagreed.
Under Chamberlains interpretation of the DMCA, the owners of a work
protected both by copyright and a technological measure that effectively
controls access to that work . . . would possess unlimited rights to hold
circumventors liable under 1201(a) merely for accessing that work even if
243
244
Id. at 1195.
Id. at 119293. The Federal Circuit has thus rejected the views of some
commentators that s. 1201, in effect, created an exclusive right of access. See e.g., Jane
C. Ginsburg, Copyright Legislation for the Digital Millennium, 23 Colum. J. L. &
Arts 137, 14043 (1999).
245
Chamberlain, 381 F.3d at 1195.
246
Id. at 119597.
247
Id. at 1197.
273
that access enabled only rights that the Copyright Act grants to the public.248
The Federal Circuit found this construction of the DMCA problematic for a
number of reasons.249
For one thing, Congresss exercise of its constitutional authority must be
rational; yet, as construed by Chamberlain, s. 1201(a) borders on the irrational.250 For another, its interpretation of s. 1201(a) would flatly contradict
1201(c)(1) a simultaneously enacted provision of the same statute.251 It
was consequently necessary to adopt an alternative construction that leads to
no such contradiction.252
Construing s.1201(a) as though it was concerned only with control over
access, and not with rights protected by copyright law, would be both absurd
and disastrous.253 It would allow any manufacturer of any product to add a
single copyrighted sentence or software fragment to its product, wrap the
copyrighted material in a trivial encryption scheme, and thereby gain the
right to restrict consumers rights to use its products in conjunction with
competing products.254 This would allow virtually any company to attempt
to leverage its sales into aftermarket monopolies, even though this would be
unlawful under the antitrust laws and the copyright misuse doctrine.255
At least as problematic to the Federal Circuit were the implications of
Chamberlains interpretation of s. 1201 for the rights of consumers to make
fair uses:
Chamberlains proposed construction would allow copyright owners to prohibit
exclusively fair uses even in the absence of any feared foul use. It would therefore
allow any copyright owners through a combination of contractual terms and technological measures, to repeal the fair use doctrine with respect to an individual
copyrighted work or even selected copies of that copyrighted work. Again, this
implication contradicts 1201(c)(1) directly. . . . Consumers who purchase a
product have the inherent legal right to use that copy of the software. What the law
authorizes, Chamberlain cannot revoke.256
248
249
250
251
Id. at 1200.
Id.
Id.
Id. A provision that prohibited access without regard to the rest of the
Copyright Act would clearly affect rights and limitations, if not remedies and
defenses. Id.
252
Id.
253
Id. at 1201.
254
Id. For analogous concerns about the need for courts to carefully manage
boundaries between different modes of intellectual property protection, see Bonito
Boats, Inc. v Thunder Craft Boats, Inc., 489 US 141 (1989), which struck down Florida
anti-plug mold law as contrary to patent law and policy.
255
Chamberlain, 381 F.3d at 1201.
256
Id. at 1202.
274
257
258
259
Id. at 1194.
Id.
Storage Tech. Corp. v Custom Hardware, Engg & Consulting, Inc., 421 F.3d
1307 (Fed. Cir. 2005).
260
Id. at 130910.
261
StorageTek also claimed copyright infringement. A majority of the Federal
Circuit decided that the 17 USC. 117 safe harbor for computer maintenance services
protected CHEs activities. Storage Tech. Corp., 421 F.3d at 131118.
262
Id. at 1318. However, the StorageTek decision opens the disquieting possibility that a better-drafted contract could exclude the provision of competing repair
services by express terms that this court would uphold. Id. at 131617.
263
Id. at 1319.
275
rights protected by copyright law and the circumvention of the TPM, no violation of the DMCA anti-circumvention rules could occur.264
Broader implications of the lock-out technology cases
While this trio of cases Lexmark, Chamberlain and StorageTek reached the
right results, they failed to consider a fundamental postulate of US intellectual
property law, namely, that the exclusive rights that copyright law confers
cannot be used to defeat competitive uses of non-copyrightable functional
products or features that are suitable for regulation under the more procompetitive mandate of the patent laws.265 This proposition, established by the
Supreme Court in the 1880 landmark case of Baker v Selden and extended by
Bakers progeny, stands for the necessity of maintaining a clear line of demarcation between industrial and artistic property laws.266 Properly understood,
Baker v Selden authorizes intermediate copying of even an entire copyrightable work in order to extract the non-copyrightable functional elements,
so long as the competitors ultimate production avoids any unnecessary taking
of protected expression.267
Unfortunately, some commentators have obscured the pristine meaning of
Baker v Selden,268 which Professor Kaplan, among others, clearly understood.269 There has been a regrettable tendency to treat Baker as merely
264
265
Id.
Baker v Selden, 101 US 99 (1880). See e.g., Sega Enters. Ltd. v Accolade,
Inc., 977 F.2d 1510 (9th Cir. 1993) (affirming the lawfulness of reverse engineering of
copyrighted software to get access to interface information which was beyond the
scope of copyright protection); Atari Games Corp. v Nintendo of Am., Inc., 975 F.2d
832 (Fed. Cir. 1993) (accord).
266
See generally J. H. Reichman (1989), Computer Programs as Applied
Scientific Know-How: Implications of Copyright Protection for Commercialized
University Research, 42 Vand. L. Rev. 639, 649 n. 288 (analysing historical meaning
of Baker v Selden and criticizing commentators misinterpretations, especially that of
Melville Nimmers treatise); Pamela Samuelson (2007), Why Copyright Law Does
Not Protect Processes and Systems, 85 Tex. L. Rev. 1921, 194461 (demonstrating that
Nimmers interpretation of Baker is unsound).
267
See Pamela Samuelson, Baker v. Selden: Sharpening the Distinction
Between Authorship and Invention, in Intellectual Property Stories 181, 18192
(Rochelle Cooper Dreyfuss and Jane C. Ginsburg, eds. 2004) (discussing Bakers repudiation of copyright protection for useful arts and its implications for the lawfulness of
reverse engineering uncopyrightable technologies).
268
See e.g., Melville B. Nimmer and David Nimmer, Nimmer on Copyright
2.03, 2.18 (2006) (interpreting Baker narrowly).
269
See Benjamin Kaplan, An Unhurried View of Copyright 6366 (1966). See
also Reichman, supra n. 249, at 649 n. 288; Samuelson, supra n. 249, at 195361;
Lloyd L. Weinreb (1998), Copyright for Functional Expression, 111 Harv. L. Rev.
1149, 1175.
276
endorsing a form of fair use in cases involving functional works270 rather than
as an independent and fundamental, perhaps even constitutionally based,
subject matter requirement of the federal intellectual property system.271
Baker v Selden, properly understood, establishes fundamental limits on the
ability of copyright owners to exercise control over the development of technologies because this would bypass the strictures of the patent law.272 Because
of this, the DMCA cannot override Baker, and its fundamental policy prescriptions cannot be frustrated by the provisions of that Act.273 There is, moreover,
no legislative history suggesting that Congress intended to override Baker and
its progeny in adopting the DMCA anti-circumvention rules.
The Federal Circuit deserves considerable praise for expressly recognizing
that balance is a bedrock principle of intellectual property law and for developing a framework for interpreting s. 1201 that enables courts to develop a
balanced approach to interpretation of the DMCAs anti-circumvention rules
insofar as copyright owners try to use them to block fair and other non-infringing uses of technically protected copyrighted works. Just as the court in
Netcom rejected the White Papers unbalanced and overly broad interpretation
270
Sega Enters. Ltd. v Accolade, Inc., 977 F.2d 1510 (9th Cir. 1993); Atari
Games Corp. v Nintendo of Am., Inc., 975 F.2d 832 (Fed. Cir. 1993).
271
US Const. Art. I, 8, cl. 8 (giving Congress power to promote the progress
of science and useful arts, by securing to authors and inventors exclusive rights for
limited times for their respective writings and discoveries (emphasis added)). See also
J.H. Reichman, Legal Hybrids Between the Patent and Copyright Paradigms, 94
Colum. L. Rev. 2432 (1994) (discussing the fundamental premises of patent and copyright regimes).
272
Insofar as Sony held that technologies lacking in substantial non-infringing
uses can be regulated by copyright law, even if technologies with substantial noninfringing uses cannot be, we regard Sony as consistent with Bakers fundamental
precepts.
273
We are concerned about whether federal appellate courts will vindicate the
pristine meaning of Baker v Selden or even perceive its critical importance for satisfactorily resolving this class of cases on more than ad hoc, tentative grounds. We are
also concerned about the Federal Circuits tendency to defer in some cases to so-called
contractual terms (regardless of the lack of meaningful assent by the licensee) of
mass-marketed products, which undermines our confidence in the staying power of that
court as a check on abuses of public interest limitations on intellectual property rights.
See e.g., Monsanto Co. v McFarling, 363 F.3d 1331 (Fed. Cir. 2004) (enforcing
license on a bag of seeds sold to a farmer). Courts dealing with Lexmark or
Chamberlain-like DMCA claims may find it useful to consider Professor Burks
intriguing theories of anticircumvention misuse. Burk, supra n. 135. This would avert
the risk posed if the DMCA anti-circumvention rules allowed every product sold on the
general products market to obtain 150 years of copyright protection behind digitized
electronic fences that have nothing to do with the protection of literary and artistic
works.
277
274
275
278
279
(1) Some years ago, the American Civil Liberties Union challenged the
constitutionality of a law requiring public libraries to install filtering software if they take funds to promote Internet access to patrons. The filters
were meant to protect minors from accessing indecent or otherwise
harmful materials. However, such software under- and over-blocks
content, and it impedes access to materials which, though harmful to
minors, may qualify as constitutionally protected speech for adults.279
When the Supreme Court ultimately ruled against the constitutional challenge, it recognized the under- and over-blocking problem, and held that
over-blocking interfered with the legitimate interests of adults in accessing some blocked materials.280
The challenge for libraries since that decision has been to decide
whether to install filters, and if installed, which filtering software to
choose. Libraries may want to conduct a comparative assessment of the
efficacy of software filtering programs, but filtering software will likely
use TPMs to block access to the list of sites that the software blocks.
Because makers of filtering software are likely to consider block-lists as
proprietary trade secrets, they are unlikely to agree to bypassing the
TPMs. Library staff may also lack sufficient expertise to bypass the
TPMs to make such an assessment.281
takedown procedure under US law. As we explain at p. 281, we believe that the reverse
notice and takedown procedure would also be an appropriate and desirable means for
EU member states to implement their obligations under the Copyright Directive. But
the precise scope of those obligations is a matter that different member states have read
differently. See infra text accompanying nn. 309310. For other examples of public
interest uses that have been or may be thwarted or chilled by the DMCA, see e.g.,
Benkler, supra n. 14, at 38889; Ginsburg, supra n. 14, at 20; Lipton, supra n. 14, at
11315; Sadd, supra n. 14, at 32122; Samuelson, supra n. 14, at 54445, 54849, 553.
See also Electronic Frontier Foundation, Unintended Consequences: Seven Years
under the DMCA (as updated April 2006) available at http://www.eff.org/IP/DMCA/
DMCA_unintended_v4.pdf.
279
United States v Am. Library Assn, 539 US 194 (2003).
280
Justices Kennedy and Breyer thought that the interests of adults in access to a
wider array of materials was adequately addressed by provisions of the Congressional
legislation that allowed libraries to unblock sites for patrons wishing to view blocked
but nonetheless lawful content. Id. at 21415 (Kennedy, J., concurring); id. at 21520
(Breyer, J., concurring). Unblocking may, however, involve circumvention of a TPM,
which could run afoul of s. 1201(a)(1)(A).
281
See Pamela Samuelson (2007), Principles for Resolving Conflicts Between
Trade Secrets and the First Amendment, 58 Hastings L.J. 777, 79091 (discussing an
effort to reverse engineer a TPM to get access to block-list information for filtering
technologies, such as those widely used by libraries, that was thwarted by threats of
DMCA anti-circumvention liability).
280
It is in the public interest for libraries to have access to this information. Under a reverse notice and takedown procedure, a court could order
the software filtering firms to take down the TPMs so that the comparative analysis could take place. The software filter developer could petition the court to condition the takedown on the libraries willingness not
to reveal the trade secret block-lists. We have confidence that courts
could fashion appropriate relief that balanced the interests of the libraries
in being able to communicate findings with other librarians and the interests of the software developers in keeping the list data secret.
(2) A linguistics professor might want to develop a compilation of clips from
movies to show that the word redskins in Western movies has been
systematically used in a derogatory fashion.282 If this professor is not a
technically sophisticated person, he or she may not be able to bypass CSS
in order to make these clips from DVD movies. If the professor requests
access to unprotected forms of these movies to engage in the stated fair
uses and this request is ignored or denied by the motion picture studio
copyright owners, the linguistics professor should be able to ask a court
to order the studios to provide the appropriate access to the movies or to
authorize the takedown by a circumvention service on their behalf.283
(3) The Computer History Museum is among the entities that might want to
undertake a project to preserve computer programs written during the
1960s to early 1980s.284 Some software developers have employed
TPMs to control access to the programs; many programs are, moreover,
stored in now-obsolete formats and/or on obsolete storage media that
have effectively become TPMs. A Computer History Museum researcher
282
See Samuelson, supra n. 14, at 540 (giving this example). Public interest users
should not, in our judgment, have to undertake extra expense and effort to search for
possible alternative formats for the works of which they want to make fair use when a
technically protected format is near at hand. In this respect, we join the EFFs criticism
of the Copyright Office for its unwillingness to consider the inconvenience and
expense of such efforts as a factor favouring permitting fair use exemptions for such
users. See EFF on Rulemaking, supra n. 138, at 45.
283
See e.g., Ginsburg, supra n. 14, at 17 (suggesting that judges could authorize
circumvention services to facilitate fair uses of works protected by TPMs).
284
It is not entirely clear whether computer programs in machine-executable
forms would have been protectable under the Copyright Act of 1909, although the US
Copyright Office began accepting registration of computer programs as copyrightable
works in the mid-1960s. See Copyright Office Circular 31D (January 1965), reprinted
in Duncan M. Davidson, Protecting Computer Software: A Comprehensive Analysis,
1983 Ariz. St. L.J. 611, 652 n. 72. Obviously, bypassing a TPM protecting access to
programs written in this period would not give rise to s. 1201 liability if the programs
were not copyrightable, but the risk for a preservationist in circumventing these old
TPMs would nevertheless be real, given the registrations accepted then.
281
would have to bypass the TPMs to preserve this historical material and
store it in updated formats. Rather than waiting three years for the next
LOC rulemaking,285 Computer History Museum personnel should be
able to ask a court to issue a reverse notice and takedown order insofar
as copyright owners of the software did not agree or could not be found
to give consent to bypassing the TPM.286
(4) Security researchers are often interested in reverse engineering TPMs,
such as those used to protect commercially distributed sound recordings,
for purposes such as determining if the TPMs might cause software to be
installed on users computers that would cause the computers to be
vulnerable to security attacks or that might surreptitiously monitor and
report back on users behaviours.287 Undertaking such research would
almost certainly involve bypassing the TPM and making tools to do so.
Given the narrowness of the encryption research or computer security
testing exceptions to s. 1201, this activity would probably not qualify for
a statutory safe harbour.288 Yet, the work would nevertheless be in the
285
17 USC. 1201(a)(1)(C). There is currently a partial exemption for libraries
and archives to bypass a TPM to preserve digital content stored in obsolete formats, but
this may not apply to museums and it certainly does not authorize the making of tools
in order to engage in such circumventions. See Perzanowski, supra n. 142, at 16
(discussing the narrowness of the exception for obsolete formats).
286
Difficulties in locating copyright owners have prevented many creative and
educational reuses of copyrighted works, especially many older ones. The US
Copyright Office has proposed allowing reuses of so-called orphan works to proceed
if the reusers have made reasonably diligent efforts to seek permissions. See US
Copyright Office, Report on Orphan Works 8 (2006). A similar problem may arise with
TPMs. With the possibility of up to $2500 of statutory damages per circumvention at
stake for violation of s. 1201, see 17 USC. 1203(c)(3), there is a risk that public interest users, such as archivists, would be deterred from preservation activities. With a
reverse notice and takedown procedure, the archivist could be assured that he or she
would incur no liability for this circumvention as long as he or she did not infringe
copyrights in the works.
287
See e.g., Deirdre Mulligan and Aaron Perzanowski (2007), The
Magnificence of the Disaster: Reconstructing the Sony BMG Rootkit Incident, 22
Berkeley Tech. L.J. 1157. Another public interest issue posed not only by the Sony
BMG rootkit incident but more generally is that right holders do not always give notice
that they have deployed TPMs in mass-marketed digital content. Without notice of
TPMs, it becomes possible to inadvertently violate ss. 1201(a)(1)(A) and 1201(a)(2) if
one reverse engineers a purchased copy of digital content.
288
If, for example, the TPM does not use encryption, but some other technique,
the encryption research exception would, strictly speaking, not apply. See 17 USC.
1201(g). The computer security testing exception only applies if one is testing a
computer network for security flaws. Id. at 1201(j). The unduly narrow nature of
these exceptions is discussed in: National Research Council, The Digital Dilemma:
Intellectual Property in the Information Age 17176 (2001).
282
public interest, even if the right holder in the sound recording did not
approve of this activity.
Security researchers ought to be able to engage in such reverse engineering and to disclose the results of their research at scientific conferences.289 In keeping with the reverse notice and takedown regime, a
court could determine that research-related activities of this sort are
lawful under a proper interpretation of s. 1201.
Other considerations
Although it would be more cost-effective to have a streamlined administrative
process for considering reverse notice and takedown requests,290 a judicially
289
See e.g., Joseph P. Liu (2003), The DMCA and the Regulation of Scientific
Research, 18 Berkeley Tech. L.J. 501, 52837 (arguing for flexibility in the anticircumvention regulations as applied to scientific research). It is worth pointing out that
security researchers are unlikely to be interested in getting access to the digital content
protected by the TPM; they are primarily interested in the TPM itself and how it might
interact with the content. As long as such researchers do not engage in or knowingly
facilitate copyright infringement, their activities should not violate the DMCA. A
reverse notice and takedown regime could be adapted to facilitate such research.
290
See e.g., Lipton, supra n. 14, at 155 (Administrative approaches tend to be
more flexible and less formal in their procedures than judicial processes and are generally less costly than judicial hearings.). We recognize that our proposal has at least two
disadvantages. First, few prospective privileged users may have the resources to seek
judicial support for reverse notice and takedown challenges to technically protected
content, and second, the prospective privileged users will have to identify themselves
to the copyright owner rather than making spontaneous fair or other non-infringing
uses without informing the relevant copyright owners. See Burk and Cohen, supra n.
14, at 5961 ([A] preauthorization requirement would be costly and would chill spontaneous uses. . . . [A]pplication to a third party is likely to compromise the sort of
anonymity that users presently enjoy. . . . Spontaneous uses likely would disappear
altogether. . . . [U]nder this system, fair use might become the sole provenance of
well-capitalized firms with the resources to engage in the process.).
The first problem may be mitigated by the rise of public interest organizations
(including nonprofit organizations such as the Electronic Frontier Foundation and high
technology clinics such as those in operation at American University, Boalt Hall,
Stanford, and USC Law Schools) with the capacity to represent prospective fair users.
Moreover, in time, an administrative process might be set up to resolve these challenges, as Lipton proposes, supra n. 14, at 14955.
As to the second problem, a comparative approach is necessary. Realistically, the fair
use infrastructure that Burk and Cohen propose is less likely to be achievable than the
reverse notice and takedown procedure we propose. So while their proposal is more
socially optimal than ours in that copyright owners would not have to know the identity of the prospective fair user, ours is more socially optimal in that courts can actually make it happen. Moreover, a reverse notice and takedown procedure might, in
time, lead to something akin to the fair use infrastructure they envision, if copyright
283
developed case-by-case evolution is, in our judgment, preferable to a statutorily mandated administrative process. The case-by-case approach is more
dynamic, flexible, and responsive to the fine details of each situation. It is,
moreover, likely to lead to a normative framework for dealing with such
requests. We fear that a statutorily created administrative process at this point
would remain vulnerable to political economy problems akin to those that
brought about the unbalanced DMCA anti-circumvention rules in 1998.
Once the courts develop normative baselines for dealing with reverse
notice and takedown requests, however, an administrative process could
evolve over time to apply and refine this normative framework. This development could also induce copyright owners to engage in private initiatives
consistent with this framework, such as designating circumvention services to
which putative public interest users might apply to obtain circumvention for
non-infringing purposes.291
We believe that courts will be able to discern when putative public interest
users are not acting in good faith when making reverse notice and takedown
requests. Courts can also put in place safeguards to ensure that the reverse
notice and takedown regime does not bring about the increased infringements
that the DMCA was enacted to avoid (for example, by ordering copyright
owners to make use of trusted circumvention services rather than ordering
takedowns of the TPMs that might lead to massive infringements).
Whether courts in the United States will, in practice, defend good faith
public interest communities against technologically induced inhibitors of noninfringing uses with the same zeal they have thus far used in guarding against
online inducers of infringement in Napster, Aimster, and Grokster remains to
be seen. Certainly, the logic with which the courts have justified limitations on
regulation of dual-use technologies resonates with similar concerns to vindicate non-infringing uses of technically protected content and to remove barriers now thwarting development of appropriate technologies to achieve this
goal. A judicially engrafted reverse notice and takedown solution could
provide a minimalist bridging device to achieve this balance. Chamberlain and
StorageTek provide a conceptual framework for an interpretation of s. 1201
out of which the reverse notice and takedown approach we propose could
develop through common law adjudication.
owners found it more efficient to designate a service to deal with public good circumvention claims instead of having to respond to them on a regular basis.
291
Indeed, this may be a way to accomplish the fair use infrastructure that Burk
and Cohen envisioned some years ago. See Burk and Cohen, supra n. 14.
284
292
Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by
authors in connection with the exercise of their rights under this Treaty or the Berne
Convention and that restrict acts, in respect of their works, which are not authorized
by the authors concerned or permitted by law.
Id. (emphasis added).
293
See Copyright Directive, supra n. 10, Art. 6(4).
294
See infra Application of reverse notice and takedown under Article 6(4) at
p. 288.
295
See infra The unfulfilled normative commitment underlying Article 6(4) at
p. 282.
296
See infra text accompanying nn. 294297. For a summary and analysis of
member state implementation, see Guido Westkamp, The Implementation of Directive
285
In this section, we explain the basic contours of Art. 6(4) of the Directive,
and how adoption of the reverse notice and takedown procedure would implement member states obligations under that provision. This discussion also
allows us to elaborate further on some aspects of the proposal already
mentioned in this chapter.
The Unfulfilled Normative Commitment Underlying Article 6(4)
The EU Copyright Directive starts from the general normative position that
exceptions and limitations that would have been available absent the application of TPMs should remain available notwithstanding the application of such
measures.297 Unlike the DMCA, the Copyright Directive does not contain a
list of exemptions from the circumvention prohibitions.298
However, the EU legislators were aware of the risk that TPMs might become
an absolute prohibition restricting users from engaging in acts permitted under
286
The Directive thus seems to take the position that a technological adaptation,
namely, the application of TPMs, should not alter the balance that existed
under default rules of copyright law with respect to the enjoyment of exceptions and limitations.302 We call this principle prescriptive parallelism, to
convey the notion that the traditional copyright balance of rights and exceptions should be preserved in the digital environment.303
Article 6(4) is only one dimension of parallelism in the EU Directive. It
also contains a provision that anticipates a reduction in private copying levies
under national copyright laws, potentially to zero, where copyright owners
have applied TPMs to works and thus secured by technology what they
formerly obtained through legally sanctioned levy schemes.304 Copyright
299
See Lionel Bently and Brad Sherman, Intellectual Property Law 30911 (2nd
edn 2004) (noting fears expressed).
300
See Bernt Hugenholtz (2000), Why the Copyright Directive is Unimportant,
and Possibly Invalid, 22 Eur. Intell. Prop. Rev. 501 (describing Art. 6(4) as a provision that is presumably intended to reconcile the interests of right owners employing
technical protection measures with the interests of users wishing to benefit from copyright limitations); Bently and Sherman, supra n. 299, at 310 (As regards the relationship between the technological measures and exceptions to copyright, article 6(4) of
the [Copyright Directive] provides for a strange, barely comprehensible, compromise.).
301
See Copyright Directive, Art. 6(4).
302
Article 5(3)(o) also permits member states to create exceptions or limitations
to rights provided for in Arts. 2 and 3 in certain other cases of minor importance where
exceptions or limitations already exist under national law, provided that they only
concern analogue uses . . . . Copyright Directive, Art. 5(3)(o).
303
Compare similar concept expressed in Agreed Statements, supra n. 2, statement concerning Art. 10.
304
Article 5(2)(b) of the Copyright Directive permits member states to create
exceptions or limitations to the reproduction right in respect of reproductions on any
medium made by a natural person for private use . . . on condition that the right holders receive fair compensation which takes account of the application or non-application
of technological measures referred to in Article 6 to the work for subject matter
concerned. Copyright Directive, Art. 5(2)(b).
287
owners should not be able to double dip, and should receive the same level of
effective protection, whether through law or technology.
We do not want to overstate the principle of prescriptive parallelism underlying the EU Directive. Article 6(4) is a means by which the EU sought to
ensure that the balance of copyright law was maintained after the application
of technological protection measures.305 But that goal is pursued against the
broader backdrop of a Directive that contemplates adjustments to the legal
rights of both copyright owners and users to reflect the availability and application of such measures. For example, one of the principal objectives of the
EU Directive was to provide legal protection against circumvention of technological protection measures, which might be conceived as enhanced legal
protection for copyright owners in light of enhanced copying capacity.306
Moreover, the prescriptive parallelism of Art. 6(4) must also be viewed
against the treatment of exceptions by the EU Directive generally. Although
the stated objective of the Directive was in part to harmonize the disparate sets
of exceptions and limitations available under national copyright laws in the
EU, the Directive effected only a very modest amount of harmonization, at
least in the short run.307 Its broad list of exceptions is largely permissive,308
although there is a mandatory exception for ephemeral copies,309 and there is
a restriction on adoption of further exceptions.310
305
306
288
More importantly for purposes of this chapter, the failure to mandate the
adoption of a wide range of exceptions undermines the effectiveness of Art. 6(4)
in achieving its general goal of prescriptive parallelism. Article 6(4) only guarantees that technological protection measures should not impede the ability of
third parties to take advantage of exceptions or limitations if they are provided
in national law.311 Furthermore, there are a number of other significant textual
constraints on the potential effectiveness of Art. 6(4), including its limitation to
seven defined exceptions rather than all exceptions or limitations existing in
national law,312 its inapplicability to works made available on-demand,313 and
knowledge that adopting such exceptions will not meet with the objections of the
European Commission.
311
See id. at Art. 6(4).
312
These include exceptions for copying by libraries and educational institutions,
copying for the benefit of persons with a disability, and copying for the purpose of
scientific research. There is no coherent explanation, other than raw political compromise, for the inclusion of these exceptions but not others in Art. 6(4). See Copyright
Directive Implementation Study, supra n. 11, at 110 (Because this provision was negotiated in the last hours before adoption of the final text of the Directive, there is no
public record available to shed light on the legislators intent. As a result, the list of
limitations included in Article 6(4) appears highly arbitrary.). Indeed, the arbitrariness
of the list may simply reflect the broader failure of the Directive to rationalize treatment of exceptions generally. See id.
Moreover, Art. 6(4) does not, for example, include uses that users are entitled to
make because a work is in the public domain or because all that is taken is otherwise
unprotected by copyright law. It can be argued that the protections of Art. 6 do not
apply to public domain material in the first place because right holders are not in a position to authorize uses of such works. As a result, some national legislatures have taken
the position that TPMs on public domain works can be circumvented without liability.
See Urheberrechtsgesetz [Copyright Act], 12 September 2003, BGBl. I at 1774, Art. 1,
95(a)(2) (F.R.G.). Of course, in practical terms, if right holders package public
domain works with some protected works, it is unclear whether this interpretation will
be sufficient to save access to such works without more affirmative legislative statement. See Bently and Sherman, supra n. 299, at 309.
313
The mechanisms of Art. 6(4) do not apply where the work is made available
on an on-demand basis because the provision is inapplicable where the work or other
subject matter is made available to the public on agreed contractual terms in such a way
that members of the public may access them from a place and at the time individually
chosen by them. The language of this sentence in the directive itself makes the scope
of the limitation uncertain and could be tested in a number of ways. See Bently and
Sherman, supra n. 299, at 311 n. 132 (noting room for dispute regarding the phrase
agreed contractual terms); see also Copyright Directive Implementation Study, supra
n. 11, at 112 (suggesting that confining this limit on Art. 6(4) to negotiated contracts
would be consistent with the legislative purpose).
More importantly, the on-demand language surely cannot be read in ways that render
the general provision meaningless. See Maciej Barczewski (2005), International
Framework for Legal Protection of Digital Rights Management Systems, 27 Eur.
Intell. Prop. Rev. 165, 167 (noting that reading the available contractually on-demand
289
its unclear relationship with the anti-circumvention and interoperability provisions in the Software Directive.314
These limitations in the text of the Directive have caused many scholars to
doubt the capacity of the provision to achieve its declared objectives.315 In deference to ordinary canons of interpretation, we are reluctant to read the limits in
Art. 6(4) in ways that render the general provision meaningless.316 However,
rather than focus on the details of the limitations of Art. 6(4) as enacted, and
perhaps looking forward to the possible revision of the Directive to take into
account a recent report commissioned from the University of Amsterdam
Institute for Information Law,317 we will view the conceptual mechanism of Art.
6(4) as a means of ensuring continued viability of privileged uses notwithstanding the application of technological protection measures. More particularly, we
will consider the reverse notice and takedown proposal as a vehicle for implementing Art. 6(4) and exploring its possible reform.
Reverse Notice and Takedown as a Mode of Implementing Article 6(4)
The reverse notice and takedown proposal articulated in Setting the stage for
a reverse notice and takedown regime at p. 255, essentially consists of two
limits in Art. 6(4) in ways that allowed digital lock-up of all works available online
would conflict with the directives aims); see also infra text accompanying n. 306. The
same interpretive rationale surely should be applied to yet another limit on Art. 6(4),
namely, that because the provision only applies where the beneficiary has legal access
to a work, it is arguably ineffective against access control measures. See Severine
Dusollier (2003), Fair Use by Design in the European Copyright Directive of 2001,
Comm. of the ACM, April 2003, at 51, 5354 (2003) [hereinafter Fair Use by Design];
Dusollier, supra n. 11.
314
Council Directive 91/250/EEC, 1991 O.J. (L 122) 42 (EC) [hereinafter
Software Directive]. The anti-circumvention provisions and interoperability exceptions
in the Software Directive appear to survive the adoption of Art. 6. See Copyright
Directive, supra n. 10, recital 50; see also Software Directive, supra, Art. 7(1)(c);
Bently and Sherman, supra n. 299, at 311312 (discussing UK implementation and
noting different treatment of software).
315
See Hugenholtz, supra n. 300; Dusollier, Fair Use by Design, supra n. 313.
316
See Thomas Rieber-Mohn (2006), Harmonising Anti-Circumvention
Protection with Copyright Law: The Evolution from WCT to the Norwegian AntiCircumvention Provisions, 37 IIC 182, 188 (offering an interpretation of which
contractual arrangements by right holders would pre-empt member state intervention
by reference to the need to give Art. 6(4) some meaning); Barczewski, supra n. 313, at
167.
317
See Copyright Directive Implementation Study, supra n. 11. That report
concluded that the principle underlying article 6(4) . . . is worth maintaining but
recommended that the provision be simplified and clarified in a number of ways that
ensure its effectuation. See Copyright Directive Implementation Study, supra n. 11, at
116.
290
parts. First, implicitly, all uses privileged under traditional copyright principles
should continue to be privileged in an era of digital rights management. The
application of TPMs should not alter the balance of rights between copyright
owners and users.318 This is a substantive principle, which might be followed
with different modifications in different countries.319
Secondly, in order to effectuate this substantive principle, users need a mechanism by which to vindicate their rights and to secure the certainty required to
engage in creative activity privileged under traditional copyright principles.
Different institutional or procedural means through which to pursue this objective are possible,320 but we believe the reverse notice and takedown procedure
affords a number of distinct advantages, many of which were canvassed in
Setting the stage for a reverse notice and takedown regime at p. 255.
As an initial matter, we believe the proposed reverse notice and takedown
procedure should be considered as a means of implementing member state
obligations under Art. 6(4). This proposal should be studied by countries
committed to compliance with the EU regime, which includes not only the
member states of the EU, but also countries that commit to such a regime
(whether in general terms or in detail) in bilateral trade negotiations.321 Even
318
See e.g., Paolo Spada, Copia privata ed opera sotto chiave [Private Copies
and Locked Down Works], 2002(1) Rivista Di Diritto Industriale 591, 597598 (stating that the system of technological protection measures provided authors by the EC
Directive must acknowledge the exceptions to authors rights, including privileged
uses, because these are an integral part of the authors rights system and not merely
contingencies of contract or the owners brute force) (trans. JHR).
319
Even within the traditional copyright system, exceptions are quite different
from one country to the next. How each country might want to approach the digital
environment is unlikely to be more uniform.
320
For example, Professor Spada believes that the Directive entitles privileged
users disadvantaged by TPMs to assert their rights under the Directive in national
courts. See Spada, supra n. 318, at 598.
321
Compliance with EU law is an obligation not only of all European Union
member states, but also of member states of the European Free Trade Area (EFTA), as
well as a number of countries pursuing future European Union membership or entering
into bilateral trade agreements with the European Union. See Maximiliano Santa Cruz
(2007), Intellectual Property Provisions in European Union Trade Agreements:
Implications for Developing Countries, Intl Centre for Trade and Sustainable
Development 23. In the past, the bilateral trade agreements negotiated by the EU have
contained obligations with respect to intellectual property stated at a very general level,
such as compliance with the WIPO Copyright Treaty. See id. at 10. In contrast, the
United States has in its bilateral trade agreements sought to secure compliance with
more detailed standards that resemble the language of the DMCA rather than the terms
of the WCT. See Chander, supra n. 18, at 206. However, some observers have detected
a shift in the EU approach toward the more aggressive US approach in more recent
negotiations. See Santa Cruz, supra, at ixx, 18.
291
if certain limits apparently embodied in Art. 6(4) turn out to circumscribe its
actual scope in EU member states,322 member state implementation of a
narrower provision (for example, with respect only to certain exceptions)
might still afford insights as to how the basic structure of the proposed reverse
notice and takedown procedure could be enhanced to better ensure that anticircumvention provisions are consistent with privileged uses.
Moreover, such an exercise might also highlight the ways in which Art.
6(4) could itself be broadened as EU legislators consider a revision of the
Directive in light of the recent report by the Institute for Information Law at
the University of Amsterdam.323
Application of Reverse Notice and Takedown under Article 6(4)
Under Art. 6(4), right holders are required to ensure that beneficiaries of
exceptions have the ability to exercise those exceptions notwithstanding the
application of technological protection measures to copyrighted works.324 If
right holders do not voluntarily ensure that result, member states are obliged
to devise a mechanism to compel it.325
Member states have implemented this obligation in a number of different
ways.326 Each of the different forms of implementation offers a model for
preserving privileged uses; yet, most are deficient and would benefit from a
reverse notice and takedown procedure.327
Triggering an entitlement to relief
The reverse notice and takedown procedure would be available to any
particular user who wished to engage in a privileged use with respect to
even a single work. Thus, the threshold would be substantially lower than
the adverse effect on classes of work standard found in the rulemaking
authorization contained in the DMCA, even as refined under the 2006 rule-
322
323
292
making.328 But this more generous approach is fully consistent with Art. 6(4),
which would appear to allow analysis of particular uses of particular works by
particular users.329
One could argue that the unavailability of a single work to be put to a single
use might be deemed insufficiently substantial a cost to justify the mechanisms
contemplated by Art. 6(4). But this calculus depends in part upon the nature of
the mechanism and upon what is contemplated by the member state as an
appropriate measure in response to any given inability to exercise an exception granted by copyright law. If the procedure were speedy, and if appropriate measure meant one that permits a single circumvention, then there would
be virtually no real cost to a state acting on the basis of a lower trigger threshold.330
Because the reverse notice and takedown procedure contemplates the
possibility of relief in the form of a limited exemption for a particular user, it
would seem perfectly appropriate that the obligation of member states should
arise more easily than if broader relief were sought. As the recent refinement
by the Librarian of Congress of the notion of classes of works reflects,331 the
sub-categories of privileged uses that emerge from a matrix of affected works,
from groups of users, and from a range of uses, are substantial and disparate.
Not only must different forms of relief be available, but also different levels of
need to actuate permitted uses should trigger such relief.
The fact that relief under the reverse notice and takedown procedure might
be appropriate even with respect to a single use of a single work should not
preclude the possibility of using the procedure where technological protection
measures are having a more pervasive effect. Arguably, the relief available
under any state-imposed mechanism should reflect the degree and type of harm
caused by the application of technological protection measures. Thus, member
states may need to create more intrusive or structural relief for third-party users
or competitors if lawful uses of entire classes of works are being impeded.332
While this type of analysis parallels that conducted by the Register of
Copyrights in the triennial rulemaking to some extent, the reverse notice and
328
See Exemption to Prohibition on Circumvention of Copyright Protection
Systems for Access Control Technologies, 71 Fed. Reg. 68472 (27 November 2006) (to
be codified at 37 C.F.R. 201) [hereinafter 2006 Rulemaking], at 67.
329
See Copyright Directive, Art. 6(4) (incorporating by reference exceptions in
Art. 5 that involve particular uses for particular purposes including, for example, copying for the purpose of scientific research).
330
See Symposium, The Law & Technology of Digital Rights Management, 18
Berkeley Tech. L.J. 697, 760, 765 (2003) (remarks of Graeme B. Dinwoodie on
Anticircumvention Regulations in the United States and Elsewhere).
331
See 2006 Rulemaking, supra n. 328.
332
See Symposium, supra n. 330, at 76566 (remarks of Dinwoodie).
293
333
334
335
294
338
See Rieber-Mohn, supra n. 299, at 188 (arguing that voluntary measures by
right holders must be appropriate in order to avoid member state intervention and
must occur within a reasonable period of time).
339
Some private ordering has clearly occurred in the shadow of Art. 6(4). See
Copyright Directive Implementation Study, supra n. 11, at 107.
340
See id.
341
See also Ginsburg, supra n. 14.
295
use doctrine or other privileged uses in computer code will prove immensely
difficult.342 Thus, this cannot be the sole mechanism through which to ensure
privileged uses.
Moreover, such arrangements raise broader normative concerns. Relying
on copyright owners accurately to map technology to legal rules delegates
immense power to those owners both in the interpretation of the default rules
and in assessing the adequacy of the technology used to guarantee permitted
uses.343 Even if the copyright owners accurately interpreted and implemented
existing permitted uses, technological features would remain inherently backward-looking.344 One of the advantages claimed for the fair use doctrine is its
capacity to adapt efficiently to reflect new technological conditions.345
The European Commission viewed legislative intervention as a background
threat to provide incentives for voluntary arrangements with copyright
owners. Even so, the reverse notice and takedown approach immediately
guaranteeing the right to demand the exercise of privileged uses, regardless of
voluntary arrangements may be preferable. The desired end is the same:
342
See Nic Garnett, Automated Rights Management Systems and Copyright
Limitations and Exceptions, WIPO Doc. No. SCCR/14/5 (27 April 2006), available at
http://www.wipo.int/edocs/mdocs/sccr/en/sccr_14/sccr_14_5.doc.
343
See Eduardo M. Penalver and Sonia Katyal, Property Outlaws (Fordham Law
Legal Studies Research Paper No. 90, April 2007), available at http://ssrn.com/abstract=745324 (discussing anti-delegation architecture of copyright law). To the
extent that we wish to rely on the incorporation of privileged uses in the architecture of
the technological protection measures, it might be important to enlist the support of unfair
competition or consumer protection law in requiring the disclosure by copyright owners
of the precise nature and extent of technological protection measures. This objective has
been secured in a number of European countries, in part through DRM-specific legislation (e.g., Germany), Urheberrechtsgesetz [Copyright Act], 12 September 2003, BGBl. I
at 1774, Art. 1, 95(d) (F.R.G.), and in part through litigation under general principles
of consumer protection (e.g., in France). See Association CLCV / EMI Music France,
Tribunal de grande instance [TGI] [ordinary court of original jurisdiction] Nanterre, 6e
ch., 24 June 2003 (Fr.), available at http://www.legalis.net/jurisprudence-decision.php3?id_article=34 (fining Sony for failing to disclose TPM). As a result, market forces may
play a greater role in ensuring that copyright owners do not abuse the application of technological protection measures in the first place. See also Nika Aldrich, A System of LogoBased Disclosure of DRM on Download Products (29 April 2007), available at
http://www.ssrn.com/ abstract=983551.
344
Of course, the same may be true of agreements reached between copyright
owners and users. Thus, any voluntary agreement that is concluded ideally should go
beyond the articulation of present substantive rules and contemplate procedural or
institutional components that facilitate attention to the spontaneity and dynamism of
the ways in which users might wish to engage with copyrighted works.
345
See H.R. Rep. No. 94-1476, at 66 (1976); see also Pamela Samuelson (1993),
Fair Use For Computer Programs and Other Copyrightable Works in Digital Form:
The Implications of Sony, Galoob and Sega, 1 J. Intell. Prop. L. 49.
296
297
absent the involvement of such third parties, the rights secured by the reverse
notice and takedown procedure may effectively become worthless.349 In this
context, the proposal thus derogates from parallelism with traditional copyright law, but it does so because the technological realities are different. A
commercial copy shop might have improved the efficiency of professors
producing course packs or students making personal copies, but the copying
could have occurred without their help.350 The same is not true of technological circumvention (otherwise there really would be some doubt about whether
the measures were effective).
Developing appropriate forms of relief
Of course, one can avoid this debate entirely, at least within the structure of
Art. 6(4), by noting that this question is closely tied to the question of relief.
To the extent that the relief provided is more structural in nature, such as
requiring the modification of the TPMs or the distribution of the work in
unprotected format, procedural devices such as expanded standing or thirdparty beneficiary rules would be unnecessary. Such structural relief does
appear consistent with the type of approach contemplated by Commission
officials under Art. 6(4), when they suggested that the relief might include the
distribution of unlocking keys.351
oriented third parties from claiming third-party beneficiary status with respect to the
assertion of privileged uses forced the British House of Lords, in a leading case involving control of the spare parts market, to adapt a doctrine based in property law that
imposed restrictions on the initial seller of the property, rather than find a right personal
to the user of the property. Thus, in British Leyland Motor Co. v Armstrong Patents
[1986] 1 All ER 850 (HL) (UK), the Court held that the owner of copyright in the drawings of an exhaust pipe of a car could not enforce that copyright so as to prevent the
sale of unauthorized spare parts because to do so would derogate from the grant of the
property right in the car.
This doctrine, though short-lived in UK copyright law because statutory revisions
quickly addressed the specific problem of spare parts and rights in the designs of useful
articles, highlights the importance of limiting the rights of the right holder rather than
conferring personal rights only on individual users. Cf. Canon Kabushiki Kaisha v
Green Cartridge Co., [1997] AC 728 (PC) (appeal taken from HK) (per curiam opinion by Lord Hoffman); Mars UK v Tecknowledge Ltd [2000] FSR 138 (Ch.) (UK)
(opinion of Jacob LJ) (noting effect of demise of the British Leyland principle under
UK law).
349
See Copyright Directive Implementation Study, supra n. 11, at 133.
350
See Princeton Univ. Press v Mich. Document Serv., 99 F.3d 1381 (6th Cir.
1996), cert. denied, 520 US 1156 (1997).
351
See Jorge Reinbothe, The Legal Framework for Digital Rights Management,
Digital Rights Management Workshop, Brussels, 28 February 2002, at 2, available at
http://ec.europa.eu/information_society/eeurope/2005/all_about/digital_rights_man/
doc/workshop2002/drm_workshop_brx_rev.doc.
298
Focusing on the nature of relief available under the reverse notice and takedown procedure might be a cleaner approach than innovating with procedural
devices. At p. 255, we suggested that copyright owners receiving the reverse
notice and takedown request would either have the responsibility to take down
the TPMs that impeded privileged uses or the obligation to contest the use on
legally actionable grounds.352 Compliance with such a request would, of
course, effectively grant structural relief, albeit without judicial or administrative intervention. A failure to comply with the reverse notice and takedown
request could then provide a user group with standing to seek the right to
circumvent for the purposes of specified non-infringing uses.
If the user group was successful, the ability of similarly situated third
parties to take advantage of the courts decision would depend upon the nature
of the relief granted. In countries that recognize the doctrine of collateral
estoppel, third parties could clearly rely on the courts determination as to
whether the use in question was privileged. However, spreading the full benefits of the courts ruling might depend upon whether the court simply permitted the requesting party to circumvent, permitted the user group to employ a
provider of circumvention services to unlock the TPM, or ordered the copyright owner to modify the TPM.353
The significance of the nature of the relief granted in this regard becomes
clearer when one examines the deficiencies in one member states implementation of Art. 6(4). Under the provisions implementing Art. 6(4) in the UK,
users who are unable to engage in a privileged use due to the application of
TPMs may petition the Secretary of State.354 The Secretary of State can
require the copyright owner to demonstrate a voluntary measure or agreement or face directions that enable the relevant beneficiary to take advantage
of the copyright exemption.355 If the copyright owner fails to follow those
directions, it will be found in breach of a duty actionable by the user that
complained.356
This procedure suffers from several deficiencies. In particular, it requires an
application to the Secretary of State every time a user believes its right to
engage in a privileged use is being impeded.357 The reverse notice and take352
353
299
down procedure may also suffer from a similar problem if applications must
be made on a case-by-case approach and the relief contemplated simply authorizes a particular user to circumvent a particular technological protection
measure and no more. However, this direct approach should prove much
simpler than a formal referral to an administrative body, and practice under the
proposal as supplemented by judicial decisions, when necessary should
facilitate reliance on the mechanism over time, especially in common law
jurisdictions.
If the directions from the Secretary of State required the copyright owner
to modify the TPM, as a Recital of the Directive hints, one form of appropriate measure might be one that would have an across-the-board effect.358 If the
relief that a user could request under the reverse notice and takedown procedure could likewise take this form, a similar erga omnes effect could be
achieved.359
The possibility of structural relief is important in ameliorating another
weakness of the UK procedure (which might also, to some extent, be
levelled at the reverse notice and takedown proposal). Requiring application
by the beneficiary of the exemption fails to give adequate weight to those
instances where creative acts covered by a privileged use are spontaneous in
nature.360 Copyright exemptions traditionally operated on the premise that the
still assessing whether a technological protection measure is impeding any particular
privileged use, not whether an act of circumvention (or a device) will ex post be
excused from liability because of that fact. See Law 3057/2002 (Official Gazette
A/239/10 October 2002), Art. 81, Implementation of the Directive 2001/29/EC of the
European Parliament and of the Council of 22 May 2001 on the Harmonization of
Certain Aspects of Copyright and Related Rights in the Information Society and Other
Provisions, available at http://portal.unesco.org/culture/en/file_download.php/
3368a2bd0fffab9a5310a8e00abfb926Greek_law+.pdf (Greece). See generally
Copyright Directive Implementation Study, supra n. 11, at 6768 (summarizing institutional choices made).
358
See Copyright Directive, recital 51 (providing example of modifying an
implemented technological measure).
359
The recital expressly mentions other means of ensuring the ability to engage
in privileged uses. One of the responsible Commission officials suggested at the time
the Directive was adopted that these means might include handing out locking keys.
See Reinbothe, supra n. 351, at 2. Certainly, the language of right holders making
available to the beneficiary seems to suggest affirmative conduct, beyond merely
enacting an exemption to allow the beneficiary to engage in an act of circumvention
(though that would also be a possible measure).
360
Requiring an application to a government official in order to engage in creative
activity also devalues the importance of privacy or anonymity as an aspect of the creative
environment. See supra n. 290 (admitting this defect). In the notice and takedown procedure established by s. 512, the copyrighted works at issue are created prior to the joining
of dispute. Thus, the procedure does not interfere with the spontaneity of creative acts, or
the potential importance of anonymity in the creative process.
300
user would engage in the contested act and the legitimacy of that act would
later be determined by application of the allegedly relevant exemption, a practice whose risks might also inhibit actual resort to spontaneous uses. The
departure from this traditional assumption is in part simply a product of the
application of TPMs, which of themselves establish an inverted default of ask
first, act later. Nevertheless, requiring individualized applications in order to
engage in privileged uses does not help.
Here again, if structural relief could be requested by a user seeking to
engage in privileged uses, the costs of such a procedure and the repressive
effect of having to seek permission would more often become a one-time
occurrence. This supports the suggestion above that the reverse notice and
takedown procedure should permit the demandeur to seek broader relief than
merely obtaining immunity to circumvent.
While such structural relief as requiring the modification or elimination of
technological protection measures may, at first blush, seem quite radical, it is
fully consistent with Art. 6(4), which contemplates that copyright owners have
an affirmative role to play in ensuring the preservation of the balance of rights
between owners and users of works.361 To be sure, the relief that would be
secured through the mechanisms implementing Art. 6(4) is not detailed in the
Directive, and some commentators have argued that it cannot require the copyright owner to reveal the digital lock.362 But a per se rule foreclosing such
relief is inconsistent with the open-ended nature of the Directive, and indeed
with statements by Commission officials after its adoption.363
Whether such relief could undermine the efforts of copyright owners to
protect against even infringing uses364 would depend upon the terms under
which such disclosure was made. For example, if a handover of the digital lock
were conditioned on the manner in which the information was used or
disclosed, it might enable the privileged uses without undermining the copyright owners legitimate rights to protect against infringement. This possibil-
361
301
ity should make the reverse notice and takedown procedure attractive to industry. To the extent that the information is disclosed to third parties who will
facilitate the privileged use by a particular demandeur, the provision of
circumvention services as opposed to the manufacture of devices is less likely
to implicate the copyright owners nightmare scenario.
Likewise, under the original Australian implementation of the WCT, the
statute allowed circumvention devices to be supplied to a beneficiary of an
exception for a permitted use if the person making the privileged use provided
the supplier with a signed declaration to that effect.365 In any event, allowing
a circumvention service provider to assist a particular user should be less problematic.366
No predetermined single form of relief should be established. One size will
likely not fit all, given the wide range of uses that should be privileged. Yet,
there may be circumstances when, under defined conditions, even the disclosure of the digital lock might be appropriate. One of the benefits of the fair use
doctrine has been its flexibility and its ability to adapt to changing circumstances. The capacity of technology to effectuate a balance of rights, and what
that balance should be, may well be very different in five years time. Bodies
established under Article 6(4) in the European Union, and courts in the United
States under a reverse notice and takedown procedure, should remain free to
develop appropriate means to ensure the continued ability to engage in privileged uses.
Broader Perspectives and the Role of the Commission
The reverse notice and takedown procedure is precisely the type of conceptual
approach that is mandated, albeit in a narrow form, by Art. 6(4). A member
state could implement the reverse notice and takedown procedure as a means
of fulfilling the obligations imposed by Art. 6(4). As a result of the Directives
inadequate harmonization of exceptions and the opaque language of Art. 6(4)
itself, it is unclear how many privileged uses are protected by Art. 6(4).367
Some countries have implemented Art. 6(4) without clear reference to specific
365
See Jeffrey Cunard et al., WIPO Standing Comm. on Copyright and Related
Rights, Current Developments in the Field of Digital Rights Management, WIPO
Doc. No. SCCR/10/2 (1 August 2003), available at http://www.wipo.int/documents/
en/meetings/2003/sccr/pdf/sccr_10_2.pdf.
366
See Ginsburg, supra n. 14, at 17.
367
See Copyright Directive Implementation Study, supra n. 11, at 169 (suggesting revision of Art. 6(4) to give protected status to those limitations that . . . reflect
the fundamental rights and freedoms enshrined in the European Convention on Human
Rights, [and] those that have a noticeable impact on the Internal Market or concern the
rights of European consumers).
302
CONCLUSION
By the end of the multilateral negotiations held at Geneva in 1996, the intense
struggle among stakeholders representing content providers, the telecommu-
368
See Marcella Favale, Technological Protection Measures and Copyright
Exceptions in EU27: Towards the Harmonization, at 10 August 2007,
http://www.law.-depaul.edu/institutes_centers/ciplit/ipsc/paper/Marcella_Favale
Paper.pdf, at 22 (draft paper presented at Intellectual Property Scholars Conference)
(Every country that decided to single out only some exceptions, picked from the list a
different selection from that [in Art. 6(4)] of the Directive, and from that of the other
countries.).
369
See supra n. 319 and accompanying text (making this point).
303
nications industry, online service providers, and the educational and scientific
communities produced a workable compromise in the WCT. The importance
of preserving access to the copyrighted culture protected in cyberspace under
the new Treaty was expressly recognized in at least three important places:
(1)
(2)
(3
This historic compromise made it possible to establish a balanced legal infrastructure for worldwide networked communications of copyrighted works in
the digital environment.
Unfortunately, at the national implementation phase, the balance struck at
Geneva gave way, in the US, to the one-sided provisions of the DMCA and, in
the EU to the only slightly less unbalanced approach of the EU Directive.
While the DMCA formally acknowledged the need to preserve privileged uses
in s. 1201(c), ss. 1201(a) and (b) have arguably separated access from privileged use and made it difficult, and under some interpretations impossible, to
raise questions of privileged use once TPMs control access to copyrighted
works. The EU Copyright Directive took an equally tough approach to restricting access through TPMs. Although the Directive generally invoked a need to
respect exceptions and limitations in local law, it simultaneously limited the
scope of the provision enabling such privileged uses.
The end result on both sides of the Atlantic has been the emergence of a
distorted, unbalanced copyright regime in cyberspace with a growing chorus
of complaints from educational, scientific, and other public interest users,
among others, and a growing revolt against the legal restraints on legitimate
uses of the copyrighted culture in some quarters. The abusive possibilities
inherent in the DMCAs access control provisions became dramatically visible
in the recent lock-out cases, where TPMs were used to perpetuate the kind of
370
371
372
304
fraud on the patent law that the Supreme Court had struck down in its 1880
decision in Baker v Selden.373
Moreover, these extreme distortions of basic copyright principles mask the
much greater daily pressures that the DMCA puts upon the public interest user
community, which depends upon easy and continuous access to ideas, facts
and other inputs to knowledge that copyright laws have never been allowed to
protect. Unless these distortions are remedied, a copyright system that was
designed to promote progress by expanding the outputs of literary and artistic
works could end by choking off access to essential inputs to the production of
knowledge as a global public good in the digital environment.
Our proposal for a reverse notice and takedown procedure designed to
reduce the tensions between access protection measures and privileged uses
attempts to rebalance the copyright equation in cyberspace before the damaging effects of overprotection give rise to systematic failure or breakdown.
Among its many advantages in the US is the fact that it can be judicially developed and applied on a case-by-case basis, with low transaction costs and relatively few risks to either side. It allows bona fide public interest users to
continue their work without undue interference from TPMs and with the
support of the content-providing industries themselves, who may verify the
legitimate uses being enabled and contest uses that seem to stretch the boundaries of legally defined privilege. It builds on workable procedures that have
already proved their usefulness in the context of ISP liability, while enabling
pinpoint litigation on borderline issues that all sides will want clarified. There
is good reason to believe that industry itself might prefer a gradualist mechanism of this kind to more intrusive legislative measures with unknown future
consequences.
If judicial experimentation with a reverse notice and takedown procedure
proved unsuccessful for reasons we cannot foresee, it could be judicially abandoned as easily as it had been adopted. If, instead, it proved effective, the end
results could eventually be codified both in the US and abroad on the basis of
the experience gained in the meantime. In that event, our proposal would have
helped copyright law to regain its traditional balance in the digital environment while implementing the true spirit of the historic compromise originally
embodied in the WIPO Copyright Treaty of 1996.
373
101 US 99 (1880).
Index
ABC Startsiden 978
advertising revenue 26, 61, 11718, 121
Africa, making available rights 5052
Aldrich, N. 295
allofmp3.com 31
Altnet 121, 1278
Amstrad 17, 18, 39, 40, 122, 126, 210,
211
anonymity and the Internet 21422
ISP revealing subscriber details
21416, 217
online liability, sharing out 21922
anti-circumvention provisions 2412,
245, 24654, 255, 269, 270, 274,
276, 289
see also circumventing devices
antitrust laws 144, 145
Anton Pillar order 120
AnyDVD software 106
Arctic Monkeys 196
Armstrong, T. 231, 254
Arriba 79, 847, 102
Asia
broadband expansion 445
communication to the public rights
50
future of legislation 69
making available right 49, 68
see also individual countries
Atkin, L. 126
Audible Magic 226
audio fingerprint technology 589
Austin, Graeme W. 123, 12447
Australia
authorization, three-part test for
1718
authorizing copyright infringement
11923, 12530, 132, 204
circumvention devices 301
communication to the public
1223
contributory liability 122
306
Belgium
file-sharing and filtering 323
future of legislation 70
headlines as pointers 77, 789, 82
hyperlinks and implied consent 878
illicit content, hosting of links to
99101
links sites 23, 92
Benkler, Y. 231, 254, 278
Bently, L. and B. Sherman 285, 2878,
300
Berne Convention 13031, 135, 137,
1456, 14950, 159, 174, 190,
264, 283
Article 2(2) 1845
Article 5(2) 176, 183, 1846, 187,
188
Article 5(4) 189
Article 7 176
Article 9 20, 1612, 183
Article 10bis (1) 1878
Article 13 160
see also Internet copyright
infringements, international
developments; TRIPS; WIPO
Bertelsmann 16, 207, 212
Bhutan, communication to the public
rights 50
Big Champagne 21314
bipolar copyright system for digital
network environment 14895
administrative compensation system
proposal 1567
and P2P dark net 164
anti-copyright models 153, 1556
Article 10 WCT, agreed statement to
1745
and Berne Convention 14950, 159,
160, 1612, 174, 176, 183,
1846, 1878
beyond copyright models 153, 156
compulsory licensing, opt out scheme
158, 15960, 163, 164,
166, 167, 168, 169, 170, 171,
1734, 2578
compulsory licensing, suggested
1578, 180, 1889
copyright management information
1556, 1578, 167
copyright and P2P networks 1514
Index
BitTorrent 3, 29, 30, 56, 224
Blakeney 208
Botswana, Copyright and Neighboring
Rights Act (2000) 51
Boyle, J. 269
Braun, N. 296, 300
Brazil, file sharing jurisdiction 213
broadband expansion 445
Brown, M. 255
Brunei, making available right 49
Bruno, A. 3
BT 217, 219, 222, 225
BT Cleanfeed 225
Burk, D. 231, 254, 267, 276, 282, 293
Burkina Faso, Law for the Protection of
Literary and Artistic Property 51
Cable and Wireless 223
caching
and hyperlinks 878
and online liability, sharing out
200201
and predicate act theory 137
and technically protected copyright
works 237, 238
Cambodia, making available rights
49
Canada
anonymity and the Internet, ISP
revealing subscriber details
214, 217
authorization of infringement 556,
204, 209, 210
Copyright Act 200201
embedded links and copyright
834
intellectual property rights 216
making available rights 20, 556,
200, 202, 203
self-service photocopying of
copyright materials 55
SOCAN (Society of Composers,
Authors and Music Publishers)
834, 200203, 211
Chander, A. 233, 290
child pornography 225
China
advertising revenue and online piracy
61
broadband expansion 445
307
308
copyright law
anti-delegation architecture of 295
authors role in 142, 1456
and consumer protection 295
and patent laws, links between
2434
secondary infringement 12, 3, 45,
78
secondary infringement, and
hyperlinks 5, 71109
self-service photocopying of
copyright materials 55
and Web 2.0 services 75, 77, 78
see also individual countries
Corwin, P. and L. Hadley 155
Creative Commons 265
Creative and Media Business Alliance
2212
Cunard, J. 301
Davidson, D. 280
Dawyndt, P. 265
DeCSS 1046, 2512, 251, 27980
deep linking 6061, 72, 73, 912, 108
Denmark
Copyright Act 91
ISPs and file sharing 2223
links sites 23, 912, 209
making available right 204
third-party injunctions on copyright
infringements 30, 31
Desbois, H. et al. 164
digital-rights management (DRM)
systems 1489, 1529, 1656,
174, 177, 178, 181, 183, 184
pay-per-use business models 168
and technological protection 166,
16771, 173, 182, 224
see also bipolar copyright system for
digital network environment
Dinwoodie, Graeme B. 229304
discovery of identity orders 21822
see also anonymity and the Internet
Dixon, Allen N. 1242
Dogan, S. 110, 255
dual-use technology
Sony safe harbour as default rule
2426, 255
and threat to innovation 2623,
268
Index
see also technically protected
copyright works
Dusollier, S. 231, 289, 296
DVD Copy Control Association Inc. 104
E-Talk Communications 956
Eckersley, P. 151, 153, 155, 159
eDonkey 30
Eechoud, M. von 135
Einhorn, M. and B. Rosenblatt 1934
Electronic Frontier Foundation (EFF)
152, 153, 176, 191, 252, 253, 278,
279, 282
embedded links 72, 73, 81, 108
and royalties 834
EMI 59, 95, 199, 204, 217, 219
eMule 61
Epstein 176
Europe
anti-circumvention rules 2312, 233,
234, 246, 289
communication to the public right
489
Copyright Directive Implementation
Study 286, 287, 289, 291, 297,
299, 300, 302
copyright exclusivity 170
cultural industries in Europe
resolution 70
Data Protection Directives 2212
discovery of identity orders 218
E-commerce Directive 2000/31/EC
14, 21, 32, 100, 107, 202, 205,
2067, 218, 222, 223, 2245,
226, 227, 238
EC Directive 93/98, copyright term
179
EC Directive 96/9 (legal protection of
databases) 80
Enforcement Directive 2004/48 218,
221
illegal file sharing 45
Information Society Directive 198
intellectual property criminalenforcement directive proposal
33
prescriptive parallelism in 2858
public interest uses of technically
protected content 2312, 233,
234
309
310
Index
Ginsburg, Jane C. 82, 11023, 137, 141,
14950, 162, 164, 166, 172, 232,
250, 253, 254, 268, 275, 278, 280,
294, 301
Gnarls Barkley, Crazy 196
Goldstein, P. 125, 158, 189, 194
Google 23, 76, 878, 96, 1014
Google.News 75, 76, 789
Greece, technological protection
measures 299
Griffin, J. 155
Griffiths, J. and U. Suthersanen 99
Grokster 1, 2, 6, 1516, 31, 33, 356,
3841, 624, 102, 11011,
11322, 125, 1335, 137, 14044,
1467, 1523, 166, 177, 17980,
182, 1934, 204, 2089, 244, 246,
2558, 26067, 283 (see also
individual cases in Table of Cases
for breakdown)
Guibault, L. 155, 173
Hanley, Vicky 71109
Harris, E. 212
Hartwig, H. 19
headlines as pointers 769, 823
and freedom of expression 79, 1056
news reporting exceptions 789
see also pointers
Henry 224
Herman, B. and O. Gandy 250
Higgins, R. 144, 145, 147
Hilty, R. 179
Ho, J. 61
Hof, R. 260
Hoffmann, W. 186, 188
Hgberg, S. 114, 121, 208
Hong Kong
Copyright Ordinance Section 26
4950, 56
making available right 4950, 56
seeding files and swarm groups
56
Hugenholtz, B. 19, 286, 287, 289
Hugo and Hugot 219
Hyland, A. 208, 211
hyperlinks
automatic link 73, 74
collection of unprotected 7980
and communication to the public 81
311
copyright liability, caused by content
of linked site 88107
and copyrighted films 1046
deep linking 6061, 72, 73, 912,
108
direct copyright liability, cases
involving 7688
direct and indirect copyright
infringement 756
directories and copyright protection
80
dual character of linking as technique
and form of expression 724
dynamic link 73
embedded links 72, 73, 81, 834,
108
external 74
framing 72, 73, 813
headlines as pointers see headlines as
pointers
hosting ISP liability 75, 200, 208
HREF link 72
HTML code 72, 73
illicit content, hosting of links to
98101
index comparison 80
infringements involving linking
techniques and processes
8084
internal 734
intra-page 73
liability for copyright infringement
76
linking as form of expression 74
linking to file-sharing programs 978
links to circumventing devices 1047
moral rights, protection of 813
MP3 files see MP3 files
and online intermediaries 756
operators and copyright infringement
75
photographs see photographs
pointers see pointers
and posting of URL addresses 89
protected articles and cache copies
878
search engine with links to illicit
content 1014
search engines and copyright
protection 80, 848, 934,
967, 100104
312
surface linking 72
techniques for linking 724
third-party liability for links sites
224, 54
India, making available right 49
Indonesia, making available right 50,
51
innovation threat, and dual-use
technology 2623, 268
intellectual property
criminal-enforcement directive
proposal, Europe 33
Intellectual Property and the National
Information Infrastructure
White Paper, US 2345, 236,
237, 241, 242, 2458, 276
liability theories, de jure 13440, 143
and online liability, sharing out 216
international copyright law 15975, 176,
1829
mandatory minimum rights 16062
International Federation of the
Phonographic Industry (IFPI)
2021, 23, 27, 28, 29, 30, 31, 44,
59, 61, 69, 74, 80, 89, 9091, 92,
97, 99101, 196, 213, 219, 223,
261
Internet copyright infringements,
international developments
1242
ability to prevent or deter third party
38, 39
and advertising 26, 61, 11718, 121
authorization, interpretation of tests
for 35, 556
common elements, consistent
application of 3740
common law and civil law rules
1519
copyright liability to online activities,
application and limitations of
1933
copyright liability to online activities,
future cases, factors for 357
copyright liability to online activities,
solutions 3541
cost-benefit analysis 3940
definitions of terms 1315
defunct defences 4041
Einstein defence 40
extent of infringement 38
extent of third partys involvement
37, 39
filtering technologies 267, 289,
3033, 389, 117, 119, 279
financial benefit of third party 38, 39,
40, 76, 102
Frankenstein defence 40
incentives to cooperate with
copyright holders 240
knowledge of infringing activities 37,
39, 52, 76, 106
knowledge, interpretation of
elements of 37, 39
Land-of-Far-Far-Away defence 41
legislative trends 335
liability of file-sharing services
249
relationship of third party with user
37, 39
Scintilla defence 41
search engine with links to illicit
content 1034
search engines and copyright
protection 80, 848, 934,
967, 100104
self-regulation, suggested 236
statutory exemptions 212
third party, due care of 389, 76
third-party liability 2133, 39
third-party liability for links sites
224, 54
user liability 1921
Wink-Wink defence 41
see also Berne Convention; online
liability, sharing out; TRIPS
Agreement; WIPO
Ireland
authorization of infringement 204
copyright infringement provisions
2034, 206
Data Protection Acts 19882003
21516, 219
file sharing jurisdiction 214
ISPs and file sharing 21517, 219,
221
Norwich Pharmacal file-sharing
decision 21517, 219,
223
Index
Postal and Telecommunications
Services Act (1983) 215, 219
privacy issues 219, 220, 221
replication as infringement 199
Italy
ISP disclosure orders 218
music online and mobile sales 44
iTunes 26061, 263
Jacover, A. 153, 156
Jaisingh, J. 177
Japan
Copyright Law 25, 57
File Rogue case 57
file-sharing services liability 25
making available right 49, 57
mobile music piracy 445
reverse takedown and notice
approach 283
Japan MMO 25
Kabat, A. 154, 156
Kaplan, B. 273
Kazaa 2, 16, 245, 289, 31, 37, 39, 41,
523, 66, 67, 98, 113, 117,
11921, 124, 12630, 1434, 147,
209, 21112, 214, 227
Kennedy, G. and S. Doyle 27
Koelman, K. 19, 165, 168
Koneru, P. 136
Koopa 197
Korea
communication to the public rights
58
Copyright Act (2006) 34, 58, 59
Copyright Act, proposed Amendment
to Enforcement Decree 34
file-sharing services liability 257
KOMCA (Korean music publishers
society) 26
making available right 49, 50, 579
MP3 files in shared folders 589
third-party copyright liability
legislative trends 34
Kugoo 61
Kur, A. 194, 195
Kuro 278, 612
Kuwait, making available right 49
Laddie, H. et al. 17, 36, 127
313
Land-of-Far-Far-Away defence 41
Landes, W. and R. Posner 176
Laos, making available right, lack of
50
Lardner, J. 242, 245, 258
Latin America, broadband expansion
445
Latman & Tager 111
Lemley, K. 240
Lemley, M. and R. Reese 1534, 155,
159, 176, 177, 180, 255, 257, 258,
259, 262, 266, 268
Lessig, L. 110, 149, 154, 157, 158, 159,
164, 176, 177, 179, 193, 195,
262
levy/tax system, opt-in mechanism 187,
19092
compared to collective licensing
1912
features and benefits 19091
and liability rules 192
licensing, individual, and levy
system, switching between
17681
non-commercial use levy proposal
1567, 15960, 1634, 166,
167, 1689, 171, 173, 174,
177, 1789, 18081, 184, 186,
187, 19091
private copying, future of 192, 194
levy/tax system, opting out of 18190
all rights reserved clause 188
compliance with international
copyright law 1829
and exercise of exclusive rights 187
features and benefits 1812
see also bipolar copyright system and
digital network environment
licensing
collective, compared to levy/tax
system 1912
compulsory licensing, opt out scheme
158, 15960, 163, 164, 166,
167, 168, 169, 170, 171,
1734, 2578
compulsory licensing, suggested
1578, 180, 1889
Creative Commons 263
individual, and levy system,
switching between 17681
314
Index
illicit content, hosting links to 989
ISPs and file sharing 222
links sites 24, 934, 209
third-party copyright liability
legislative trends 33, 214
networking sites 197, 226, 240
New Zealand
authorizing infringement 120,
21011
communication to the public rights
50
Copyright Act (1994) 120
Nimmer, D. 244, 248, 275
Nimmer, M. 273
Nordemann, W. et al. 183, 184, 185
Norway
Copyright Act 93
downloading for private use 93
linking to file-sharing programs
923, 978
making available right 204
Oberholzer, F. and K. Strumpf 152
Oman, making available right 49
online liability, sharing out
anonymity and the Internet 21422
anonymity and the Internet, ISP
revealing subscriber details
21416
Australian cases and European
counterparts 20811
authorization of infringement in
common law 204, 210
and caching 200201
cease and desist case law 223
civil liability for online transmissions
2046
and communication to the public
199
copyright board and appeal court
decisions, and SOCAN
(Canada) 834, 200203, 211
and data protection 21516
defamation actions prior to ECommerce Directive 205
discovery of identity orders, some
European decisions on
21822
E-Commerce Directive see under
Europe
315
316
Index
public interest user groups
of technically protected content
2312, 233, 234, 2639
under DMCA, section 512,
facilitating 2646
under DMCA, section 1201,
frustrations of 2669, 270,
2713, 2767, 281, 292
Radiohead, In Rainbows 197
Ramkey 245
Reese, R. 252, 254
Reichman, Jerome H. 229304
Reinbothe, J. 298, 300
Reinbothe, J. and S. von Lewinski 161,
162, 163, 165, 173, 175, 194
revenue
advertising 26, 61, 11718, 121
financial benefit from infringement,
and peer-to-peer file sharing
54
financial benefit of third party 38, 39,
40, 76, 102
and mandatory rights proposals 154,
1556
for rights holders, lack of, and bipolar
copyright system 153, 170,
1778
royalties 834, 200
and security for copyright holders
116, 11819
reverse notice and takedown framework
case-by-case approach 2813
Europe, Copyright Directive, Article
6(4) 276, 29095
illustrative applications 27881
as mode of implementing Article 6(4)
of EU Copyright Directive
283303, 29096
suggestions 25583
to enable public interest uses of
229304
Richardson 219
Ricketson, S. 146, 161, 162, 163, 164,
165, 170, 172, 173, 174, 175, 183,
184, 185, 186, 187, 188, 189, 190
Rieber-Mohn, T. 289, 294
Rohleder, B. 192
Rthlisberger, E. 185, 186
royalties 834, 200
317
RTC 237
Russell, M. 59
Russia, file-sharing 31
Rustad, M. and T. Koenig 241
SABAM 323, 70, 227
Sadd, T. 232, 278
safe harbours
and anti-circumvention rules 230,
23252, 259
and anti-circumvention rules, checks
and balances in 23454, 259,
260, 262, 263, 266
provisions 23541, 301
Safe Harbour Agreement, Europe
220, 226, 238
Safe Harbour Agreement, US 220
Salow, H. 240
Samoa, making available right 49, 50
Samuelson, Pamela 142, 229304
Santa Cruz, M. 28990
Scarlet (Tiscali) 323, 222, 223, 224,
2267
Schlesinger, Michael 4370
Schnherr, F. 183, 188
Science Commons 263
Scientology, Church of 989
Scintilla defence 41
Sciorra, N. 245
seeding files and swarm groups 56
Seeqpod 3
Seff, A. 263
Senftleben, M. 159, 162, 163, 164, 165,
166, 172, 173, 195
Seoul Records 59
Sharman 6, 22, 289, 31, 38, 39, 40, 41,
523, 111, 117, 11921, 124, 126,
1278, 1434, 147, 21213, 214
Shetland Times 77, 82
Shih Ray Ku, R. 148, 153, 155, 156,
159, 259
Singapore, making available right 49
Sirinelli, P. 150, 170, 175, 194
SK Telecom 9
Skylink 271, 272
Skynet 99100
Sobel, L. 153, 155, 159, 166, 167
software
copyright protection, circumventing
112, 286
318
Index
reverse notice and takedown regime
see reverse notice and
takedown regime
and safe harbours see safe harbours
security research example 281
site monitoring 1278, 1556, 1578,
166, 16771, 173, 182, 239,
240
technically protected works, public
interest exceptions 250
see also bipolar copyright system for
digital network environment;
copyright control
Techno Design 24, 934, 210, 220, 222,
224
Telewest 222
territoriality
extraterritorial reach of copyright law
54, 13040
and national treatment 14562
toward a principled departure from
1436
Thailand
communication to the public rights
50
making available right 49
The Crimea, Secrets of the Witching
Hour 197
third party
copyright liability legislative trends
33, 345, 204
due care of, and Internet copyright
infringements, international
developments 389, 76
financial benefit of, and Internet
copyright infringements 38,
39, 40, 76, 102
infringement, and online liability,
sharing out 200201, 206, 211
injunctive relief against
(strerhaftung), Germany
19
liability, Internet copyright
infringements, international
developments 2133, 39
three-step test 1718, 159, 161,
16274, 184, 186, 187, 190
conflict with normal exploitation
16472
market displacement following
restriction 1656
319
320
music file-sharing 20
online child pornography 225
Personal Internet Security, House of
Lords report 225
privacy issues 219, 220, 222
Regulation of Investigatory Powers
Act (2000) 220
reverse notice and takedown
procedure and classes of users
292, 2978
Ullrich, H. 145
Universal Music 6, 16, 22, 23, 2831,
38, 4041, 524, 5960, 68, 946,
99, 111, 117, 11921, 12430,
1434, 147, 208, 21114, 220,
227
Urban, J. and L. Quilter 240
US
anti-circumvention rules 230, 2312,
2335, 236, 237, 241, 242,
245, 24854, 256, 269, 271,
274, 276
antitrust law 144, 145
Australia Free Trade Agreement 54
authorizing copyright infringement
1356, 137
cable subscription services and nearon-demand forms of
broadcasting and
communication 51
common law copyright and tort
principles 1516
communication to the public 122,
2367
Communications Decency Act (CDA)
2056, 236
contributory liability 15, 356, 63,
76, 1023, 11112, 11415,
122, 204, 209
Copyright Act 48, 51, 64, 65, 80, 85,
87, 116, 125, 135, 141, 162,
163, 164, 165, 167, 170, 194,
232, 267, 268, 272
copyright balance, search for 148
copyright exclusivity 170
copyright law 3, 32, 122, 184, 205
Digital Millennium Copyright Act
(DMCA) 48, 100, 1056, 230,
231, 232, 2334, 237, 23841,
245, 246, 25053, 254, 2556,
259, 278, 283, 291, 292, 3034
Index
publication, definition of 64, 656
reverse notice and takedown
procedure 2789
Safe Harbour Agreement 220
safe harbours provisions 23541,
25960
search engine with links to illicit
content 1014
secondary liability 11119, 209
substantial non-infringing use
standard 112, 11314, 115,
11617
technically protected works, public
interest exceptions 250
technology-friendly policies 1412
telecom industry, immunity from user
wrongs 2356, 239
temporary copies of files and
predicate act theory 137
third party, due care of 389
third-party copyright liability 33, 76
TRIPS Agreement arrangement with
EC 15051
vicarious liability 15, 63, 76, 102,
204, 209
video tape recording 112
WIPO Copyright Treaties
Implementation Act 249
Usenet 205, 237
Van der Laan, K. 218
vicarious liability 15, 18, 63, 76, 102,
204, 209
Vienna Convention on the Law of
Treaties 162, 169, 189
Vietnam, making available right 49,
50
Voelzke, J. 205
von Lewinski, S. 155, 161, 162, 163,
165, 173, 188, 189, 194, 198
Von Lohmann, F. 113, 262
Wandtke, A.-A. 154
Wang Qian 97
Warner Music 3, 16, 59
Weatherall, K. 147
Web 2.0 75, 77, 88
Weinreb, L. 273
Westkamp, G. 107, 288
Wilco 180
321
Wink-Wink defence 41
Winny 57
WIPO, see also Berne Convention;
Internet copyright infringements,
international developments;
TRIPS
WIPO, Copyright Treaty (WCT) 20, 21,
45, 14950, 159, 183, 22930,
237, 248, 264, 268, 290, 294, 295,
301, 302, 3034
WIPO, Copyright Treaty (WCT), Article
8
making available right 45, 48, 173,
174, 183, 190, 198, 199, 202,
203
making available right, global
implementation of 4952, 56,
62, 64, 81, 13031, 1667
WIPO, Copyright Treaty (WCT), Article
10, tree-step test 1678, 173,
1745, 198, 229
WIPO, Copyright Treaty (WCT), Article
11, mandatory protection of
technological measures 1678,
170, 171, 173, 230, 283
WIPO, Copyright Treaty (WCT), Article
12, mandatory protection of rights
management information 167,
170, 171
WIPO, Copyright Treaty (WCT), Article
14 198
WIPO, Diplomatic Conference (1966),
distribution and
communication models 467,
51, 199
WIPO, Performances and Phonograms
Treaty (WPPT) 20, 21, 456
cable subscription services and nearon-demand broadcasting and
communication 51
WIPO, Performances and Phonograms
Treaty (WPPT), Articles 10 and
14
making available right 456, 47, 48,
160, 161, 1667
making available right, global
implementation of 4952, 56,
62, 64
making available right, incomplete
solutions and treatment of
related rights 5052
322
Wittgenstein, P. 154
WTO
dispute settlement system 150, 183
TRIPS see TRIPS
Wu, T. 241
Xunlei 6061