July 2004 Archives

File Sharing, Piracy and DRM

Jeevan Jaising: Piracy on file sharing networks: Strategies for recording companies

We find that total music sales and profit of firm is higher, and total piracy (demand on file sharing network) is lower, when the firm sells a downloadable version. We look at the firm’s optimal choice of Digital Rights Management (DRM) protection, and find that revenue decreases with increased protection, and so it is optimal for the firm not to employ any DRM, in the absence of network effects. Listening to music or watching video protected by DRM is cumbersome to users. They have to download license files, there are restrictions on the number of times the file can be copied, and restrictions on the type of devices that can play the file. As a result there is a disutility to the legal consumer, because of which the firm charges lower prices. Loss in revenue due to decreased prices cannot be compensated by the increase in demand, and hence revenue decreases with higher protection. When network effects (NE) is high, and a nominal search cost is above a certain threshold, then non-zero protection becomes optimal. This result is exactly the opposite of what was found in previous research (Conner and Rumelt 1991), where protection was found to be optimal in the absence of NE, and zero protection was optimal if NE is high enough.

DRM subtracts value and is less desirable for the consumer.

Post-hoc Parody

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In re-evaluating whether the Jib Jab "This Land" animation is parody or satire, Chris Cohen wonders whether a post-hoc evaluation of a work's parodic content is justifiable: Am I to be labeled a flip-flopper?

The four factor parody inquiry is essentially an objective one because it utilizes this post hoc reasoning - the best stuff your attorney can come up with after the fact. But actually this appears to be an attempt to get at a very subjective question: just what was the author thinking when doing the work, even if the thoughts were in the background or subconscious. In the end what the author was thinking really can be irrelevant to the the legal finding.

The threshold question in evaluating a work's status as a fair-use parody is "whether a parody may reasonably be perceived." Campbell v. Acuff-Rose Music. The parody need not even be in good taste. Whether a work is parody must be considered by using an objective, post-hoc evaluation rather than an evaluation of intent. Judging parodic content based on an author's original intent creates an evidentiary problem, if it doesn't make a finding of parody nearly impossible to establish. Allowing a post-hoc justification of parodic content serves society by encouraging, rather than chilling, speech and creativity.

It is unfeasible, if not impossible to accurately document the creator's intent regarding parody. Even for works created with the explicit goal of parodying another work, a creator may not have any evidence to prove that was her intent. Rather (especially in the age of the blog) the creator may have merely written and published a first draft, without notes, without discussion, but with explicit parodic intent. By using an objective standard, courts avoid ruling on insufficient evidence.

Even if it is possible to document the creator's parodic intent (or lack thereof) beforehand, if a work is unintentionally parodic, it has inherent social value and that expression should be protected by the First Amendment, rather than prohibited by copyright. A work created with satire, comedy, or mere vanity as the creative impetus may yet provide biting insight into the original work and be a most effective parody. With the objective standard, the public is not deprived of such works and any chilling of speech is reduced to a minimum.

In order to support a finding of parody, the work need not have been created with explicit parodic intent, but still must have more than a bare minimum of parodic content. In granting summary judgment and finding fair use parody in Mastercard v. Nader, the court noted that the parodic "message need not be popular nor agreed with. It may be subtle rather than obvious. It need only be reasonably perceived."

The post-hoc, "lawyer's best argument" evaluation of parody is used not only because of the evidentiary necessity, but because it encourages, rather than chills speech.

JibJab link roundup

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Previously: This Use is Fair Use

Wired News: Sue You: This Song Is Our Song

As far as money is concerned, JibJab hasn't made much from the popularity of This Land. Spiridellis said the company made about $1,000 from donations in the past week -- an option that's come and gone from the site before. Pitted against an estimated $20,000 in recent Web-hosting costs, it would appear This Land has cost JibJab about $19,000.

Reason: Jabbing JibJab

Nothing says more about the awful state of copyright law today than the fact that this threat actually carries some legal weight. In the 1997 case Dr. Seuss Enterprises v. Penguin Books, the Ninth Circuit of the U.S. Court of Appeals ruled that The Cat NOT in the Hat!, a book by "Dr. Juice" that recounted the O.J. Simpson trial in the style of The Cat in the Hat, violated the Seuss estate's copyright. Ordinarily the fair use doctrine permits parody, but in this case the court was unmoved: This was a satire, it ruled, not a parody. A parody would be a commentary on the Seuss book, it explained, whereas this borrowed Seuss's creation to mock something completely different. The obvious retort—that it was a parody of both—didn't carry any water.

Eugene Volokh: JibJab SoSue

The copyright owners have a pretty good case. If JibJab were making fun of the song, then the cartoon would likely be a fair use. But JibJab seems to be just using the song to make fun of Bush and Kerry, rather than making much of a comment about the song itself -- that makes the fair use defense much weaker.

EFF has taken JibJab on as a client

Rather than addressing JibJab's free speech and fair use rights, Ludlow's lawyers have now sent threat letters to JibJab's hosting provider, AtomFilms, as well as to AtomFilm's upstream provider -- evidently in an effort to get "This Land" censored right off the Internet.

Ludlow Music's demand letter to Jibjab: Re: JibJab Media Unauthorized Use of 'This Land is Your Land'

Mr. Guthrie's musical composition is an iconic portrait of the beauty of the American landscape and the disenfranchisement of the underclass. As both a populist anthem and an ironic metaphor, 'This Land Belongs to You and Me' contrasts a view of the 'sparkling sands of her diamond deserts' and the sun shining on 'wheat fields waving' with the city's working class in the 'shadow of the steeple near the relief office' who grumble and wonder if such natural treasures embody their own experience with this country. The Unauthorized Movie does not comment on those themes.

Jibjab (EFF) reply to Ludlow: Re: Jib Jab Media, Inc. and Ludlow Music, Inc.

Jib Jab's parody addresses, among other things, the lack of national unity that characterizes our current political climate (ending with te optimistic hope that unity might be rediscovered). In short, 'This Land' explores exactly the same themes as the Guthrie original, using the parodic device of contrast and juxtaposition to comment on the original.

The Importance Of: EFF Defends JibJab Animation as Parody

Fred von Lohmann learns that Ludlow may not have a defensible copyright on the music: Props to The Carter Family

Turns out Woody Guthrie lifted the melody of "This Land is Your Land" essentially note-for-note from "When the World's on Fire," a song recorded by country/bluegrass legends, The Carter Family, ten years before Guthrie wrote his classic song.

See also Salon.com: Class politics, JibJab-style

Hey! You! Get off of my Pod

Today, Apple released a statement responding to Real's announcement of Harmony:

We are stunned that RealNetworks has adopted the tactics and ethics of a hacker to break into the iPod(R), and we are investigating the implications of their actions under the DMCA and other laws. We strongly caution Real and their customers that when we update our iPod software from time to time it is highly likely that Real's Harmony technology will cease to work with current and future iPods.

Translated: "The next software update to the iPod will prevent Harmony-DRM'ed files from playing on the iPod."

Derek Slater: Apple Threatens Real

Along with piracy rhetoric, we now get evil hacker rhetoric. Since when is reverse engineering unethical? Oh right - since the DMCA, which Apple is predictably waving around. Let me remind you that Real was one of the first companies to sue the creator of an interoperating product under the DMCA, so it's not as if they're the innocent defenders of innovation here. This could make for a fine DMCA battle royale, with copyright holders caught in between. Or it could fade away - we'll see.

Ernest Miller: Apple Gets Real Serious About Harmony

As if being a hacker is a bad thing. What do you call those two guys who built a computer in their garage and started a little computer company named after a fruit?

BusinessWeek: For Apple, Harmony Is Off-Key

Apple CEO Steven P. Jobs should clearly and firmly squelch Real's attempt to infiltrate Apple's music empire. GartnerG2 analyst Mike McGuire sums it up: "At some point, Apple may decide to license [its iPod technology] to others. But they should do it for good business reasons, not because a rival issues a press release or some beta software."

Doe, ID, and P2P*

Judge Denny Chin ruled that the First Amendment does not protect the anonymity of uploaders of copyrighted files on a p2p system Sony Music Entertainment Inc v. Does 1-40, 04 Civ. 473 (pdf). Sony will be able to obtain from Cablevision the identities of 40 users of the FastTrack p2p network who shared files using their cable modems. The First Amendment does not protect anonymity in this case:

Anonymus speech, like speech from identifiable sources, does not have absolute protection. The First Amendment, for example, does not protect copyright infringement, and the Supreme Court, accordingly, has rejected First Amendment challenges to copyright infringement actions.

While the use of P2P to download, distribute, or make available for distribution copyrighted sound recordings, without permission, is an exercise of speech, that speech is not uniquely expressive enough to deserve the protection of anonymity and thwart the interests of copyright owners.

The discovery request was allowed because: this is a prima facie claim of copyright infringement; the discovery request is sufficiently specific to obtain the desired information (defendant's identities); no alternative means exist to obtain subpoenaed information; central need for subpoenaed information in order to the case to proceed; defendants have minimal expectation of privacy.

Tech Law Advisor: Up/Downloaders Identities Not Protected by First Amendment

The court in finding against the Doe defendants found that although the First Amendment's protection extends to the internet, it does not protect copyright infringement. See e.g. Harper & Row and Universal v. Reimerdes. Nor does anonymous speech enjoy absolute protection.

News.com: Judge: RIAA can unmask file swappers

This ruling is the latest decision to clarify what legal methods copyright holders may use when hunting down people who are trading files on peer-to-peer networks. Courts have spent the last few years grappling with how to reconcile Americans' right to be anonymous with the entertainment industry's own right to sue people who violate copyright law.

Ernest Miller: RIAA Subpoenas for John Does Valid

Although this is a decision by a single district court, it is likely to be persuasive in other courts though it isn't binding.... The most important argument involved the First Amendment right to anonymity of the file sharers. While the judge recognized the First Amendment interest, he concluded that it was not sufficient to protect anonymity for filesharing of copyrighted files without any additional speech. This was the right decision.

*read to the tune of "doe, a deer, a female deer"

Tapping E-Mail

In response to the Councilman case, Rep. Jay Inslee (D-WA) is introduced the E-Mail Privacy Act of 2004. This bill would regulate the interception of e-mail like real-time interception of telephone conversations and require law enforcement to obtain a court order to intercept e-mail. (via beSpacific.)

GAO on E-Voting

GAO: Electronic Voting Offers Opportunities and Presents Challenges (pdf):

Looking toward to the upcoming 2004 national election and beyond, the challenges confronting local jurisdictions in using electronic voting systems are not unlike those facing any technology user. These challenges include (1) performing those security, testing, and maintenance activities needed to minimize risk and adequately ensure that the system operates as intended; (2) managing the system, the people who interact with the system, and the processes that govern this interaction as interrelated and interdependent parts; (3) having reliable measures and objective data to know whether the system is meeting the needs of the jurisdiction’s user community (both the voters and the persons who administer the elections); and (4) making choices about future system changes in light of whether a given system will provide benefits over its useful life commensurate with life-cycle costs, and ensuring that these costs are affordable.

Automatic Weapon IP Piracy?

The NY Times reports that the US has been purchasing unlicensed knock-off Kalashnikov AK-47 rifles: Who's a Pirate? Russia Points Back at the U.S.

Washington contends Russian intellectual-property pirates cost the United States more than $1 billion a year.

Now Russia is striking back. A Russian industry and product designer are asserting that the United States has been abetting intellectual-property pirates to suit its own needs, by directing copies of Russian merchandise around the world.

The complaint is not about software or music. It makes no mention of movies or video games. It is about the Kalashnikov assault rifle, the most prolific firearm ever made.

Adware Patent

Jupiter analyst Gary Price wonders if NetZero has really been granted a patent for adware: NetZero patents...AdWare?

NetZero filed for the patent in April 2000 and, last month, was granted a patent for High volume targeting of advertisements to user of online service

Disclosed is an ad server and local device that interface for selecting advertisements to be viewed by users of an online service based upon user activity. The local device preferably stores a targeted activity list of activity identifiers and associated advertisements in memory, preferably in cache memory. The local device monitors the activity on the local device and compares the activity to the identifiers in the targeted activity list. If the activity matches one of the identifiers, the local device causes one or more advertisements to be played.
Will this lead to patent infringement litigation against Claria and WhenU in addition to copyright and trademark (the IP trifecta)?

Russian Ringtone Rights

Pravda reports: Russian musician protects his intellectual property rights

The leader of the popular Russian rock group "Leningrad", Sergei Shnurov, has won the case of intellectual property rights violation. The court has ruled that S.B.A. Music Publishing, a subsidiary of the Gala Records company, pay 100,000 rubles to Sergei Shnurov for violating his intellectual property rights by issuing a permission for mobile phone companies to use Shnurov's music for mobile phones and karaoke, Gazeta reports.
(via IPKat)

This Use is Fair Use

CNN reports that Woody Guthrie's publisher is unhappy with the JibJab's animated take on "This Land is Your Land": Publisher peeved at political parody:

TRO believes that the Jibjab creation threatens to corrupt Guthrie's classic -- an icon of Americana -- by tying it to a political joke; upon hearing the music people would think about the yucks, not Guthrie's unifying message. The publisher wants Jibjab to stop distribution of the flash movie.
JibJab asserts that its use is a fair use.

Generally, a parody (a work which comments on the original) is considered fair use, while a satire (which comments on broad social trends, but not on the original work) is not a fair use. See e.g. Campbell v. Rose-Acuff and Suntrust v. Houghton Mifflin

Chris Cohen thinks that the video is satire, not parody:

The JibJab video would likely be considered satire, because the video does not directly target the original song. The clear target here is Bush and Kerry or politics/society in general. Also, if the video is a commercial use of the song, that will hurt JibJab's case.

Lawrence Lessig agrees with Cohen: on the meaning of “parody”:

As any copyright lawyer recognizes, it is not a “parody” in the sense that “fair use” ordinarily recognizes it. A “fair use” “parody” is a work that uses a work to make fun of the author. JibJab is using Guthrie’s work not to make fun of Guthrie, but of the candidates.

Not only does this animation comment on the public perceptions of the two candidates, but it shows how naive and marginalized Guthrie's vision of a united country is compared with modern political discourse. The animation parodies the original song by demonstrating what would result if the songwriter replaced Guthrie's idealism and hope with post-modern cynicism and rabid partisanship. The listener will think about Guthrie's unifying message and wonder if there is any place for such hope in politics today.

Ernest Miller also thinks that the JibJab use is a paradigmatic case of parody:

JibJab's wonderful parody undermines virtually every element of the original meaning of Guthrie's song. Where Guthrie's song is provocative understatement, JibJab's is merely provocative. Where Guthrie's song is one of unity, JibJab's version both mocks and ultimately supports that ideal. In a year in which the red/blue divide is frequently debated, Guthrie's call for unity would seem to be ripe for this sort of parody. Guthrie was a supporter of communism, but his America has become consumerist (which JibJab notes perfectly). Guthrie sang songs to raise political consciousness, JibJab mocks political consciousness.

The Blawg Channel's Marty Schwimmer would also find this to be fair use: My Two Cents on Jib Jab

The message of the original work is one of unity - the point of the parody in part is to illustrate the absence of unity at this time. As indicated in the 'Priceless' MasterCard case (where Nader not only commented on the two party system but on the values commercialized by MasterCard), commentary on the original work does not need to be at the primary reading of the parody. It can be so subtle as to be missed (by the plaintiff).

TechDirt notes that Guthrie took an expansive view of copyright: JibJab Threatened Over Use Of Woody Guthrie Song

Guthrie, after all, is the same singer who once put the following copyright notice on his work: "This song is Copyrighted in U.S., under Seal of Copyright # 154085, for a period of 28 years, and anybody caught singin it without our permission, will be mighty good friends of ourn, cause we don't give a dern. Publish it. Write it. Sing it. Swing to it. Yodel it. We wrote it, that's all we wanted to do."
Of course, Guthrie doesn't say "change it to create parody," but this is the type of parody which should be protected by Fair Use.

Joe Gratz thinks that "there might be more (or, depending on your perspective, less) to this case than the parody issue"

Real DRM

The NY Times reports that RealNetworks Plans to Sell Songs to Be Played on iPods

Tomorrow, without Apple's authorization, RealNetworks will start to give away software that will allow people to buy and download songs from its online music store and then play them on Apple's popular iPod portable devices in addition to those that use the Windows Media Player format and RealNetwork's Helix format.

I suspect that what the Real software does is merely strips the downloaded file of its proprietary DRM and loads it onto the music player as an unprotected MP3 or AAC file. The music player will be able to read it normally.

The Times article claims, "This will be the first time any company other than Apple has sold songs for the iPod." In fact, eMusic has been selling legitimate downloads of songs which can play on the iPod for longer than Apple.

Why would an iPod user who is locked in to using iTunes to sync her collection to the iPod even bother with Real?

UPDATE: News.com has more details: Real Networks breaks Apple's hold on iPod

Harmony also will automatically change songs into an iPod-compatible format. But because Apple has not licensed its FairPlay copy-protection software to anyone, RealNetworks executives said its engineers had to re-create their own version in their labs in order to make the device play them back.

Although the company said this action wasn't technically "reverse engineering," the software could trigger intense legal scrutiny.

So Real has created a clone of FairPlay by a process like reverse-engineering, in order to allow its DRM'ed songs to play on the iPod.

Does this constitute anti-circumvention under the DMCA? As Ernest Miller discusses in What Real's Hacking of FairPlay Doesn't Do, the Real software does not affect any songs already in the FairPlay DRM format. In fact, it only converts from one use-restrictive format into another.

Regulating VOIP

Yesterday, the Senate Commerce, Science, and Transportation Committee passed a Voice Over Internet Protocol Bill.

VOIP Regulatory Freedom Act of 2004 (S. 2281) regulates VOIP at the federal level and preempts state law with three major exceptions. States may still enforce laws and regulations of general applicability, including consumer protection laws and prohibitions against fraud and unfair trade practices. States and local governments may still require 911 and E911 services. States may still regulate transmission facilities and require VOIP providers to pay compensation to incumbent carriers for the use of facilities and contribute to the universal service fees. The bill does not affect VOIP telephony providers obligations under CALEA.

The bill requests a report from the GAO in order to assess:

  • technical capability of law enforcement to intercept and analyze IP transmissions
  • problems encountered by law enformcement when intercepting communications over the Internet or using IP
  • assessment of options for law enforcement agencies to acquire the skills and equipment necessary to analyze Internet communications
  • assessment of the first 10 years of CALEA implementation, compliance along with a cost-benefit analysis.
From the FCC, the bill requires a study assessing the first 10 years of CALEA.

Thomas: Bill Summary and Status

News.com: Senate panel embraces state VoIP taxes

ut in an unexpected twist, Sen. Byron Dorgan, D-N.D., persuaded the committee to adopt an amendment that permitted states to regulate VoIP services in two ways: levying taxes to pay for universal service and for compensating traditional telephone companies for the use of their phone lines through so-called access charges.

Law Practice Today: Everything You Need to Know about VoIP

CD Piracy

The IFPI finds that traditional music piracy (involving actual CDs) is at the highest level ever, although the rate of growth in pirated discs is slowing: Music pirate sales hit record 1.1 billion discs but spread of fake CD trade slows

Global sales of pirate music have hit another record at 1.1 billion discs annually, but thanks to stepped up enforcement efforts the fake CD trade is spreading more slowly than in recent years. Music piracy remains a huge US$4.5 billion illegal business driven by organised crime, government apathy and corruption.
In the full report, the IFPI notes a correlation between P2P and pirated discs in Taiwan. As P2P usage has increased, the amount of pirated discs sold decreased.

In Europe

IPKat reports on the latest European Commission attempts to harmonize copyright law as well as the latest European copyright cases.

Cell phone spam

PC-Radio.com reports on the First Lawsuit Over Cell Phone Spam

Lawyers for Verizon Wireless claim the defendants' messages violate the Telephone Consumer Protection Act (TCPA), as well as the Computer Fraud and Abuse Act, and New Jersey's computer fraud statute. Under the TCPA, victims are entitled to a minimum of $500 per violation as a remedy.

Acxiom hackers indicted

Directing marketing giant Acxiom had its database hacked, leading to an indictment in US District Court.

MPAA, NFL flag TiVo

In February, TiVo filed with the FCC for broadcast flag certification under the Digital Broadcast Content Protection Rule: Broadcast Flag Certification of TiVo

The MPAA and NFL filed oppositions to TiVo's certification, arguing that new TiVo features which allow TiVo subscribers to make recorded programs more portable should be subject to more stringent regulation. The Washington Post reports: TiVo's plans lead to copyright fight

In a white paper, the MPAA argues that TiVoGuard does not prevent widespread indiscriminate redistribution of broadcast content and permits copyright infringing conduct. Additionally, remote access technologies such as TiVoGuard threaten the viability of the Local Broadcasting System. MPAA filing: Legal and Policy Issues Raised by TiVoGuard

The NFL filed a comment opposing the certification of TiVo. The NFL wants to continue to limit the markets to which NFL games may be broadcast and be able to sell the NFL Sunday Ticket at an absurd premium to DirecTV subscribers, but fears that a TiVo video sharing service will harm the market.

Access all the filed comments by search in the FCC Electronic Comment Filing System for Proceeding "04-63"

TiVo's less commercially successful competitor ReplayTV offered an internet video sharing feature, which was the controversial subject of litigation. However, DNNA, the new owners of ReplayTV, dropped the Internet Video Sharing feature from the latest version of the ReplayTV.

PVRBlog: TiVo: you can only innovate if the NFL and MPAA say so

What is most shocking about the objections is that TiVo ToGo is an already crippled version of something TiVo hackers and users of software PVRs like Windows Media Center and Snapstream have been doing for years now.

Induce hearings

The Senate Committee on the Judiciary held hearings today about the INDUCE Act: "An Examination of S. 2560, The Inducing Infringement of Copyrights Act of 2004 "

For background and more links, see The Importance of Induce Act coverage and the Tech Law Advisor Induce Act blog (where I will be posting along with Kevin Heller and Chris Rush Cohen.

Rough notes from the webcast follow the jump.

Spam Miscellany

LawMeme's Rebecca Bolin looks at the state of state anti-spam laws: Fun With Preemption: State Law After CAN-SPAM

The state laws which were preempted--labeling, opt-outs, harvesting--were much less used, if at all. Many state spam laws, including the recently upheld Washington state fraud laws, are still valid. Virginia is still pursuing spammers vigorously using its falsification of headers and routing prohibitions. Washington keeps its individual cause of action even though CAN-SPAM doesn't make one, and Virginia outpaces the FTC in criminal charges, with a head start, of course

NY Attorney General Elliot Spitzer announced a settlement with e-mail marketer Scott Richter and his company, OptInRealBig.com, LLC.. In addition to a $50,000 settlement, the spammers are permanently enjoined from sending commercial email with false or misleading headers, sending messages with the intent to deceive, registering domain names with false information.

This settlement holds Richter and his company to a new standard of accountability in their delivery of emails," said Spitzer. "If he does not fulfill these standards, he will find himself back in court, facing greater penalties."
Additionally, Richter and OptInRealBig must retain and provide to the Attorney General detailed customer information and purchase records and a list of all complaints received.

Get your Induce on

Next up: Trademark

Utah-based ClearPlay developed software designed to skip over objectionable content on DVD's. In 2002, the Director's Guild of America, joined by eight studios, sued ClearPlay, alleging that the software infringes on copyright by creating unauthorized derivative works. For some analysis, see James Ball: Who Controls the Right to Create "Clean" Versions of Films?

Earlier this year, RCA started selling a standalone DVD player with ClearPlay software built-in. Now, Twice reports that a patent dispute is causing RCA to Stop Selling ClearPlay:

A Boca Raton, Fla.-based rival known as Nissim Corp. filed a patent infringement claim against ClearPlay on May 13. Nissim has developed a system called CustomPlay MediaCenter with parental control features.

Americans Complain

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Americans complain to the FCC more than ever. Denise Howell reports on a chat with Michael Powell, who notes that "In the year 2000 there were 111 public complaints about television. In the first three months of this year, there were 545,000."

The Trademark Blog's Martin Schwimmer offers a helpful tip for finding counterfeit goods for sale online: You Can Still Dial 431.322.12 For Fake

Somehow the urban myth circulated that there is a Code 431.322.12 of the Internet Privacy Act (which doesn't exist).  Website operators got it into their heads that if they cited Code 431.322.12, they could bar from their sites whomever they wanted, such as law enforcement officers or trademark attorneys.
Now, adding 431.322.12 as a search keyword provides a simple way to find sites which are most likely selling counterfeit goods.

Copyright Term Cheatsheet

Political Economy of IP

Landes and Posner, The Political Economy of Intellectual Property Law

This monograph seeks to explain the expansion of intellectual property law over the last half century, focusing in particular on the rapid growth that began with the 1976 Copyright Act. In so doing, it explores a fundamental, unresolved issue in the theory of regulation: why some kinds of regulation have increased dramatically over this period while others have virtually disappeared.
Published by the AEI-Brookings Joint Center for Regulatory Studies, June 2004.

18 hot IP issues

18 hot IP issues (mostly patent, some trademark and other internet-related.)


Ministry of Mobile Affairs (MoMA) is forced to change the name of its new gaming system because it neglected to run a trademark search before choosing a name: MoMA's Trademark Flaw is Irresistable, No More Eve

If you are looking for a page that belongs to the Ministry of Mobile Affairs Inc, please note that due to a trademark issue this website has been temporarily suspended. The Ministry of Mobile Affairs' mobile gaming product, formerly codenamed "Eve", shall be renamed and this website relaunched. "Eve" is in fact a registered trademark of CCP Ltd., an Icelandic company. We appreciate their graciousness in notifying us of the issue in a cordial manner.
By the way, The Museum of Modern Art (MoMA) might want its acronym back...

With Pictures

Appetite for Litigation

The AP reports: Judge Reject's Axl's Case to Stop Album

A federal judge has rejected a request by singer Axl Rose to stop an independent record label from releasing an album called "Hollywood Rose: The Roots of Guns N' Roses."... U.S. District Court Judge Gary Allen Feess denied the request for an injunction by citing the "nominative fair use" doctrine.

The nominative fair use doctrine is a creation of the Ninth Circuit, first introduced by Judge Kozinski in New Kids on the Block v. News America Publishing. Nominative fair use allows a person to use another's trademark for commercial purposes if the mark is used to describe the mark owner's goods or services and the use meets the following three criteria:

  1. the product or service in question must be one not readily identifiable without use of the trademark;
  2. only so much of the mark or marks may be used as is reasonably necessary to identify the product or service;
  3. the user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder.

For more about nominative fair use, check out the books at your local library, or see the following links:

Brother Records, Inc. v. Jardine, 318 F.3d 900 (9th Cir. 2003)

PACCAR Inc. v. TeleScan Technologies LLC, 319 F.3d 243 (6th Cir. 2003) (6th Circuit declines to recognize nominative fair use doctrine.)

Chad Dollinger, Nominative Fair Use: Jardine and the Demise of a Doctrine 1 Nw. J. of Tech. & Intell. Prop. 5 (Spring 2003).

Michael J. Smith, A Beach Boy, A Playmate And Five Guys From Boston Walk Into A Courtroom...

House Hearings

Gov. Computer News reports on e-voting hearings before the House Administration Committee: Lots of questions, few clear answers on e-voting

Computer security experts and election officials debating the merits of paperless voting before a House committee today presented widely differing opinions about the security of electronic voting.

One area of agreement among witnesses before the Committee on House Administration was that absolute security is impossible and the standard that direct-recording electronic voting machines must meet is “secure enough.”

(via beSpacific)

iTunes Takes Europe

Harvard Berkman Center Digital Media Project: iTunes Europe: A Preliminary Analysis

[This] report considers the legal foundation of iTunes Europe and the interplay of the service with European law.  The report examines the implications of the expansion of iTunes on the future of digital media, technology, business strategies, and international law.

DRM basics and beyond

John T. Mitchell introduces the law and policy of DRM in DRM: The Good, the Bad, and the Ugly

This paper suggests that good DRM should be encouraged and refined, bad DRM should be examined using traditional antitrust principles under a “rule of reason” analysis to determine whether harms are outweighed by the benefits, and all ugly DRM should be condemned and prosecuted as vigorously as is copyright infringement. There is excellent legal precedent for this approach. One of the most amazing features of the digital revolution is that prosecutors and regulatory agencies have failed to see how easily the legal principles developed in the analog world can be made to apply in the digital age.

RFID and Privacy

Two quick links for your perusal and enjoyment:

Wired Magazine on the promise and perils of RFID: Attention, Shoppers: You Can Now Speed Straight Through Checkout Lines

A blog covering privacy law and data protection: PrivacySpot.com

State FOI Laws

Filter this

NY Times: Internet Filters Are: [Good] [Bad] [Both]

In a case decided by the Supreme Court last week, the American Civil Liberties Union had argued that Internet filters are a great way to protect children from pornographic material online. But in a case decided by the Supreme Court last year, the A.C.L.U. argued against a law requiring filters in schools and libraries, and the organization attacked filters in a 1997 paper that said "rating and blocking proposals may torch free speech on the Internet."
Requiring filters dissuades free speech, but the availability of filtering software promotes free speech more than censorship.

CAN-SPAM in effect

Massachusetts Attorney General Tom Reilly filed the first state enforcement action against a spammer under the CAN-SPAM Act.

VoIP is not a telephone

A federal magistrate rules that the NY Public Service Commission may not regulate VoIP . InternetNews.com reports: Vonage Records Regulatory Victory

A federal magistrate is poised to issue a preliminary injunction blocking New York officials from regulating broadband telephony upstart Vonage.

Magistrate Judge Douglas F. Eaton of the U.S. District Court announced late Wednesday his intent to rule against the New York Public Service Commission (PSC), and he is expected to release a written order shortly. He may also consider making the injunction permanent. A hearing to consider that move would likely come in January, Vonage said.

Adware Advertisers

Ben Edelman examines which Advertisers are placing ads on WhenU.

News.com reports: Adware's going mainstream

Not Legal

CNet's Eliot Van Buskirk looks at some "legal MP3" sites which are no more legal than free P2P software: "100% Legal MP3s," my foot!

What these sites sell is something you can get for free from any number of Web sites: client software for accessing P2P networks such as Kazaa, WinMX, and Gnutella, along with some simple instructions on how to use them. As for the $25 charge to your credit card? None of that goes to the record labels, as some users might assume. That money generally goes to Internet entrepreneurs (actually, they're closer to parasites) who developed none of the software or the networks their so-called products use. As for you? The fact that you paid $25 to some guy in Romania changes nothing except your bank account balance. Your potential legal risk of being sued by the RIAA for making music available for sharing is unchanged.

RIAA Lawsuits Unpopular

Here's a real surprise: RIAA Lawsuits Unpopular with Americans

According to the FindLaw survey, 56 percent of American adults oppose the lawsuits. Thirty-seven percent support the industry's legal actions. Seven percent of those surveyed had no opinion. One thousands adults were surveyed, with results accurate plus or minus three percent.

No Trademark for Patents.com

".com" is a top-level domain indicator without any source-identifying significance, so patents.com is merely descriptive for patent registration software and not registrable as a trademark. In Re: Oppendahl & Larson LLP (Fed. Cir. Jun. 25, 2004)

Exterminate Licensing

A copyright licensing dispute prevents "TV's most evil villains," the Daleks, from appearing in the BBC's latest Dr. Who series. BBC News: No Daleks in Doctor Who's return.


Fans had hoped to see the Daleks' return in the series, scheduled for release on BBC One in early 2005, but feared copyright issues might stand in the way.

The BBC spokeswoman said: "The BBC offered the very best deal possible but ultimately we were not able to give the level of editorial influence that the Terry Nation estate wished to have."

But an agent for the Nation estate accused the BBC of ignoring copyright laws and said the corporation was trying to "ruin the brand of the Daleks".

In CoStar Group, Inc. v. LoopNet, Inc., the Fourth Circuit holds that an ISP or web site publisher is not liable for direct infringement of copyright by providing a service where users could possible infringe upon copyrights.

LoopNet is a provider of commercial real estate information. Sellers of real estate may upload information about a property to LoopNet's database. Users may upload photographs of the property. Some users uploaded CoStar's copyrighted photographs to LoopNet's database.

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

CoStar argues that because LoopNet's conduct does not fall within the DMCA safe harbor provision, LoopNet should have no immunity. The court rejects this argument, finding that the DMCA does not overrule Religious Technology Center v. Netcom On-Line Communications Services and common law interpretations of §§501 and 106. "It is clear that Congress intended the DMCA's safe harbor for ISPs to be a floor, not a ceiling of protection."

"ISPs when passively storing material at the direction of users in order to make that material available to other users upon their request, do not "copy" the material in direct violation of §106 of the Copyright Act." An ISP can become indirectly liable upon a showing of additional involvement sufficient to establish a contributory or vicarious violation of the act. Where a LoopNet employee's review of uploaded photographs is so cursory as to be insignificant, that should not be considered volitional conduct and therefore, LoopNet is not liable for direct copyright infringement.

CoStar Group, Inc. v. Loopnet, Inc., 03-1991 (4th Cir.,  Jun. 21, 2004). (via The Trademark Blog

In Society of Composers, Authors and Music Publishers of Canada v. Canadian Association of Internet Providers, 2004 SCC 45 (Jun. 30, 2004), the Supreme Court of Canada examines whether ISPs are liable for copyright royalties.

First, the court examines when the Copyright Act should apply to international internet transmissions. A "real and substantial connection to Canada" is sufficient to apply the Copyright Act to international Internet transmissions. Such a connection may be found by evaluating the locations of the content provider, the host server, the intermediaries and the end user.

An ISP which acts as a common carrier should not be liable for infringement in the transmissions of copyrighted works over its network:

A content provider is not immune from copyright liability by virtue only of the fact that it employs a host server outside the country. Conversely, a host server does not attract liability just because it is located in Canada. The liability of a host server should be determined by whether or not the host server limits itself to "a conduit" (or content-neutral) function.

An ISP may create a cache copy, because as a serendipitous consequence of improvements in Internet technology, it is content neutral, and "ought not to have any legal bearing on the communication between the content provider and the end user."

Society of Composers, Authors and Music Publishers of Canada v. Canadian Association of Internet Providers, 2004 SCC 45 (Jun. 30, 2004)

The Brennan Center for Justice and the Leadership Conference on Civil Rights released a set of common-sense Recommendations for Improving Reliability of Direct Recording Electronic Voting Sysytems