Category: Copyright

Copyright Office Questions Legality of Internet Archive’s National Emergency Library

Post author By Joshua Grove
Post date July 13, 2020

the word "copyright" typed on a typewriter On March 24, the Internet Archive (Archive) unveiled what it called the “National Emergency Library” (NEL) in order to “address our unprecedented global and immediate need for access to reading and research materials.” The announcement specified that Archive would suspend the waitlist for 1.4 million books in its unlicensed “lending library” until at least June 30, thus allowing an unlimited number of people to download electronic copies of the same book at the same time. Archive had previously employed a controlled digital lending (CDL) model where the number of downloads was tied to the number of physical copies Archive or its partners possessed. With the waitlist suspended, Archive temporarily abandoned the CDL model that it had relied on since 2011.

Archive’s release of 1.4 million copyrighted works without a license certainly caught people’s attention. The Authors Guild quickly condemned the move, claiming that Archive “has no rights whatsoever to these books, much less to give them away indiscriminately without consent of the publisher or author.” Maria Pallante, President and CEO of the Association of American Publishers, likewise denounced Archive’s announcement: “We are stunned by the Internet Archive’s aggressive, unlawful, and opportunistic attack on the rights of authors and publishers in the midst of the novel coronavirus pandemic.” Archive then responded in a blog post explaining that it had suspended its waitlist due to the “tremendous and historic outage” in the nation’s libraries caused by the pandemic and arguing that fair use is the “legal doctrine underlying” its CDL model “during normal times.”

A couple of weeks later, on April 16, Senator Tom Udall (D-NM) sent a letter to Acting Register of Copyrights Maria Strong asking the Office “to examine the National Emergency Library that has been organized by the Internet Archive which is operating without typical library licenses and is causing authors in New Mexico concern about the integrity of their copyrights.” In particular, Sen. Udall asked the Office to “include a legal analysis of the Internet Archive’s National Emergency Library” under Section 107 and to “recommend any corrective action that you deem necessary to comply with copyright law and protect authors.”

On May 15, Acting Register Strong submitted a detailed response to Sen. Udall, noting that “it is not the Office’s general practice to provide legal advice about specific factual scenarios” and that the “Office is particularly cautious about weighing in on circumstances or disputes between private parties.” Nevertheless, the Office provided a general analysis of how copyright law applies to libraries and then looked at how that analysis applies to “the Internet Archive’s recent activities.” Notably, the Office ultimately concluded that it “would have been beneficial for the Internet Archive to engage with writers and publishers prior to launching the National Emergency Library to discuss the contemplated parameters for the project and determine their willingness to participate.”

On June 1, a couple of weeks after the Office submitted its response to Sen. Udall, four major publishers, including Hachette, HarperCollins, Penguin Random House, and Wiley, filed suit against Archive for copyright infringement in the Southern District of New York. The complaint, which includes 127 works-in-suit, alleges that Archive’s CDL and NEL models infringe on their works, both directly and indirectly. This blog post does not address that dispute, though the publishers do raise many of the same issues in their complaint that the Office raised in its response to Sen. Udall. This blog post merely summarizes the Office’s reasoning on the fair use analysis of Archive’s National Emergency Library. It is worth noting that, even though Archive announced on June 10 that it was shutting down its NEL, the legality of the NEL is still a live issue in the publishers’ lawsuit.

Fair Use Under Section 107

Looking at the first fair use factor under Section 107 generally, the Copyright Office notes that while the “goals of promoting scholarship and education are explicitly identified in the statute as favored purposes,” it “is generally understood that many uses of copyrighted works by schools and universities must be licensed.” Citing Oracle v. Google and Authors Guild v. HathiTrust, the Office points out that “reproducing the text of physical books in digital format is not transformative unless the change in format results in new uses for the work.” Moreover, it explains that using educational materials for educational purposes “would not serve a different purpose than the original.”

Turning to the NEL specifically, the Office takes issue with Archive’s claim that “the vast majority” of the books it makes available “do not have a commercially available ebook” that would be publicly available given that libraries are closed. On the contrary, the Office states that “Archive does not appear to have verified if any of the works in its collection were available to the public in digital formats prior to including those books in its collection or removing its waiting lists” and that the NEL “includes many books for which ebooks are available commercially” at local libraries. Thus, the argument that Archive was making available works that were otherwise unavailable “does not apply to any books that were available in digital formats at the time of the copying.”

The Office notes that the NEL is available to the public for free such that Archive’s use is noncommercial. However, it emphasizes that Archive’s stated purpose of promoting scholarship and education “alone does not establish fair use.” Indeed, the Office points out that “at least some” of the 1.4 million works, such as “Stephen King thrillers and joke books,” are “likely to be accessed for entertainment rather than educational purposes.” Even for the educational books that are not available in digital formats, the Office explains that the noncommercial purpose must be weighed against “the non-transformative nature of the use.” Given that educational works are “originally intended to educate,” Archive’s use of these works “is not transformative.” And given that Archive does not provide “search functionality,” it does not fit within the “digitization cases” that were “deemed transformative,” such as Google Books and HathiTrust.

On the second factor, the Office cites Campbell v. Acuff-Rose for the proposition that “some works are closer to the core of intended copyright protection than others” and Harper & Row v. Nation for the point that the “law generally recognizes a greater need to disseminate factual works than works of fiction or fantasy.” The Office also notes that there may be “more justification” for reproducing previously published works that are “currently unavailable in the marketplace.” Nevertheless, it explains that the existence of organizations to provide copies of such works is relevant to this factor, and it mentions that the case law on a “work’s print status under the second factor is mixed.”

Applying this to the NEL, the Office clarifies that the analysis of the second factor is necessarily “fact-specific” and that each work or category of works “would need to be evaluated independently.” For example, “creative works” would be analyzed differently than “factual or informational works.” And while the unavailability of certain works might favor fair use “in some circumstances,” the Office notes that this does not appear to have been Archive’s focus. Archive instead focused on whether the books were available in digital form, making no “mention of the works’ overall availability.”

The key to the third factor, the Office explains, is “whether the secondary use employs more of the copyrighted work than is necessary, and whether the copying was excessive in relation to any valid purposes asserted under the first factor.” Moreover, while “copying an entire work often weighs against a finding of fair use,” the factor “would not weigh against a finding of fair use” if “it were necessary to copy the entire copyrighted work to achieve the purpose of the secondary use.”

The Office notes that the CDL White Paper, upon which Archive relies, “argues that it is necessary to copy the entire book to achieve the purpose of providing digital access to the work, such that the copying is not excessive in relation to the library’s purpose.” The CDL White Paper also argues that “the library prevents users from making additional copies of or further distributing the book and limits the duration for which a user can access a book.” In response, the Office points out that the courts in Google Books and HathiTrust “emphasized that the defendants had not made the full text of the copied works visible to the public” and how the Office itself (see here, here, and here) has “consistently expressed doubt that providing digital access to complete works can be considered a fair use.”

Quoting Harper & Row, the Office notes that the fourth factor, which is “undoubtedly the single most important element of fair use,” turns on “whether widespread conduct similar to the conduct of the alleged infringer ‘would adversely affect the potential market for the copyrighted work.’” The Office explains that, under Google Books and HathiTrust, the third and fourth factors are linked: “the risk that the digitized version will serve as a market substitute for the original work increases as the amount of the work that is made accessible to the public increases.” In both of those cases, the copying of entire works was permissible because it enabled transformative search functionality without serving as a market substitute by making the entire works available.

Turning to the NEL, the Office acknowledges a “disagreement among stakeholders over whether the analysis of market harm under the fourth fair use factor should consider the Internet Archive’s activities as roughly analogous to physical lending by libraries, or whether the markets for physical lending and ebook licensing to libraries are distinct.” The Office points out that no court has embraced the former approach and that “the Second Circuit squarely rejected it” in Capitol Records v. ReDigi. Moreover, the Office cites its own report noting that there are “significant differences” between lending physical copies and digital ones. And it points out that the NEL “lacks the controls cited by the CDL White Paper as necessary to mitigating market harm” since it allows “an unlimited number of users to borrow any given title simultaneously.”

On the latter approach, which holds that the market for ebook licensing is distinct from that of physical lending, the Office states that there is already “an established market” where “publishers and authors license their works to libraries for the purpose of digitally ‘lending’ them to patrons.” The fourth factor analysis here “might focus on whether the creation and distribution of digital versions of these works would affect this market, and also how, if such conduct became widespread, it would affect this market.” If digital versions of some works were not available in the marketplace, the Office concludes, “this factor might favor fair use for some, but not necessarily all, of the works contained in the National Emergency Library.”

The Office also examines how “exigent circumstances” related to the pandemic may factor into a fair use analysis. The Office notes that there “is undoubtedly a strong public interest in ensuring continued access to educational materials in this unprecedented time, which could weigh in favor of fair use.” However, while Archive’s goal “may be laudable, so is respect for copyright.” The Office states that it “would be imprudent to excuse widespread copying due to a national emergency without considering the possible repercussions on copyright law and copyright owners” since there “is also a strong public interest in ensuring that authors are able to financially survive the coronavirus crisis to be able to continue to produce creative works.” And it concludes by noting that a “court would almost certainly also take into account” Archive’s effect “on writers and publishers.”

Conclusion

The Copyright Office ultimately suggests that Archive may wish to “explore opportunities for collaboration with writers and publishers” such as by “allowing them to opt into making digital versions of their works publicly available.” While the Office never explicitly says that any particular work is being infringed, its analysis does indicate that, in its opinion, Archive cannot claim that it is engaging in fair use for all of the works made available with its National Emergency Library. Furthermore, the Office explains why other statutory limitations, such as the first sale doctrine under Section 109, would not apply to Archive’s activities. All in all, it seems clear that the Office is quite skeptical of the NEL’s legality under the fair use doctrine. Though, it remains to be seen whether the Southern District of New York will agree with the Office’s analysis.

Tags Authors Guild, Authors Guild v. Google, Authors Guild v. HathiTrust, Campbell v. Acuff-Rose, fair use, first sale doctrine, Google Books, Harper & Row v. Nation, Internet Archive, Maria Strong, National Emergency Library, NEL, publishers, Section 107, Section 109

Senate IP Subcommittee Hearing on DMCA Exposes Notice-and-Takedown Problems for Artists and Authors

Post author By Joshua Grove
Post date June 15, 2020

The following post comes from Yumi Oda, an LLM Candidate at Scalia Law and a Research Assistant at CPIP.

By Yumi Oda

On June 2, the Senate Subcommittee on Intellectual Property held a virtual online hearing entitled Is the DMCA’s Notice-and-Takedown System Working in the 21st Century? The hearing focused on the effectiveness of the Section 512 notice-and-takedown system under the Digital Millennium Copyright Act (DMCA). In what he described as “the longest opening statement” he had ever made, Chairman Thom Tillis (R-NC) first acknowledged the pressing issues of police brutality against African American communities and the COVID-19 crisis. He also emphasized the urgency of the hearing’s agenda considering creators’ ever-increasing dependency on the internet ecosystem during the pandemic. Notably, the deep sorrow over racial injustice and pledge of solidarity was shared among and acknowledged by each panelist throughout the hearing.

The panelists included: Don Henley, Musician and Songwriter; Jonathan Berroya, Interim President and CEO of Internet Association; Douglas Preston, President of The Authors Guild; David Hansen, Associate University Librarian and Lead Copyright & Information Policy Officer of Duke University; Abigail Rives, IP Counsel of Engine; Kerry Muzzey, Independent Classical & Film Composer of Kirbyko Music LLC; Meredith Rose, Policy Counsel of Public Knowledge; and Jeff Sedlik, President of Sedlik Photography. These panelists represented content creators and users of all sizes, highlighting the different types of stakeholders who are impacted by Section 512.

Originally seen as a compromise between copyright owners and online service providers (OSPs), Section 512 limits OSPs’ liability for copyright infringement in exchange for their reasonable efforts to police online piracy, including the duty to remove pirated content promptly once notified. However, as the recent Section 512 report by U.S. Copyright Office concluded, the notice-and-takedown system “is not achieving the balance Congress originally intended.” As such, this was the third hearing of a year-long review of the DMCA, which was expected to offer more practical—and potentially more divisive—insight into the notice-and-takedown system as compared to the first two hearings that were more academic in nature.

Senator Tillis stressed the issue of scale, which was highlighted in the first hearing this past February where CPIP’s Sandra Aistars and Mark Schultz both testified. There, Professor Rebecca Tushnet of Harvard Law School argued that small and medium entities typically only receive a small number of takedown notices, and an additional mandate could drive them out of business and increase market concentration. To conclude his opening statement, Senator Tillis maintained that the current system is badly failing both content creators and users, potentially requiring an entirely new system to tackle online piracy. To this end, he noted that he and Senator Patrick Leahy (D-VT) sent a letter to the Copyright Office asking for its input on how to best design an anti-piracy takedown system.

On the first panel, Eagles member Mr. Henley and bestselling author and journalist Mr. Preston spoke on behalf of creators, asking for DMCA reform and advocating for a notice-and-staydown system. Mr. Henley described how he was compelled to testify for the sake of millions of people working in the music industry whose voices are unheard, stating: “I come here out of a sense of duty and obligation to those artists, those creators who paved the road for me and my contemporaries, and for those who will travel this road after us.” He further vowed not to be silenced by what he conceived as a targeted attack by “Big Tech,” referring to a Washington Post op-ed that was published a couple of days before the hearing.

Describing it as “a relic of a MySpace era in a TikTok world,” Mr. Henley testified that the DMCA is outdated, patently unfair for music creators, and has been abused by “Big Tech” for over 20 years. In particular, he blamed large digital platforms for turning a blind eye to online piracy in the hopes of keeping traffic and ad income, hiding behind the Section 512 safe harbor protections, paying license fees well below the market price, and failing to share the fair burden of policing (despite having such capability) at the cost of the creative community. Mr. Henley emphasized the need for equitable compensation to be awarded to creators amid the pandemic because digital platforms will be the only reliable sources of income for music creators for some time.

Mr. Preston echoed Mr. Henley’s frustration over the one-sided system. Remembering the traumatic, sickening feeling of first encountering a book piracy website that listed his whole life’s work, Mr. Preston described how the current notice-and-takedown system leaves many creators in “enraging and disheartening” situations with no solution, analogous to “being mugged every single day.” Especially, Mr. Preston explained how he came to give up on filing notices after seeing the same pirated content promptly and repeatedly resurfacing under a different URL. He noted that rampant piracy has led to a 42% decrease in full-time U.S. authors’ writing income in the last decade, making it almost impossible for anyone to make a living writing books.

In contrast, Mr. Berroya, representing internet companies, and Mr. Hansen, representing research libraries and universities, claimed that the DMCA is working just fine. Mr. Berroya contended that the DMCA works as Congress intended, and the Copyright Office’s Section 512 report was inconsistent with his professional experiences. He alleged that the notice-and-takedown system allows copyright owners (whom he believed should be responsible for policing their own works) to take down their content quickly, incentivizes users’ creation and distribution, and encourages tech companies to develop tools beyond DMCA compliance, resulting in the present “golden age of content creation.” He emphasized that the DMCA merely sets a floor, not a ceiling, leaving potential room for further cooperation between creators and digital platforms.

Similarly, Mr. Hansen argued that Section 512 generally works as designed. To facilitate distribution of educational and research content, he would favor a system where content stays online unless a clear showing of infringement is made. He requested Congress to consider the “unintentional consequences” of revising Section 512, hoping that academia would not be an “afterthought” for them.

Mr. Berroya was in the hot seat most frequently on the first panel. His position supporting the status quo directly contradicted the shared, inherent belief that the DMCA should be revised, drawing questions from Senator Tillis, Ranking Member Christopher Coons (D-DE), and Senator Richard Blumenthal (D-CT). His argument largely and repeatedly relied on the potential for old fashioned dialogue, but some Senators were evidently not convinced in light of the other witnesses’ testimonies.

On the second panel, Mr. Muzzey and Mr. Sedlik represented independent artists making a living by creating and licensing their works. While recognizing the effectiveness of YouTube’s Content ID, to which he said he was “very lucky” to have access, Mr. Muzzey described how the DMCA is like “a tiny David” facing “tech Goliaths.” Specifically, in response to each takedown notice for 110,000 infringing videos located on YouTube, he received a counternotice claiming fair use incorrectly “100% of the time,” at which point he is given 10 days to file a lawsuit or the content is reinstated. This means, for a one-person, small business owner like Mr. Muzzey, the DMCA practically offers “no remedy.”

Mr. Sedlik is another artist who has had to spend countless, unproductive hours submitting takedown notices. He explained the dilemma he constantly faces: He needs to enforce his copyrights to maintain their values, but these lost hours leave him less time to create new works. Noting that the the presence of innumerable takedown notices by no means indicates success, Mr. Sedlik proposed several possible revisions to the DMCA.

On the other side of the table was Ms. Rives in support of startups and Ms. Rose on behalf of Public Knowledge. Ms. Rives contended that Section 512 is generally working well, without which many online platforms would not have existed. Referencing points made by Professor Tushnet, she argued that revising the DMCA, even slightly, would “shift the ground underneath today’s startups.” For example, she contended that imposing a duty to monitor, such as with filtering tools, would be ineffective or too costly for most startups.

Ms. Rose shifted the discussion by listing three situations where the current notice-and-takedown system puts users’ freedom of speech at risk, namely, bad DMCA takedown notices, problematic algorithmic enforcement, and most importantly, the inappropriateness of letting a private third party remove someone’s access to broadband without due process. Siding with the status quo, she warned that “asking for greater power and fewer safeguards is akin to discarding a tank and asking for a nuke.”

At the conclusion of the hearing, Senator Tillis reiterated the need to recognize the scale of infringement, and he promised to seek a path forward that would let copyright owners flag clearly infringing content so that it stays down—but without causing an undue burden on businesses and individual users.

Tags counternotices, DMCA, Don Henley, hearing, notice and takedown, notice-and-staydown, safe harbor, Senator Tillis

Senator Ron Wyden, Stop Harming Independent Creators

Post author By Joshua Grove
Post date June 12, 2020

the word "copyright" typed on a typewriter Here’s a brief excerpt of a post by CPIP Senior Scholar Eric Priest and Professor Sean Pager that was published at IPWatchdog:

As the current pandemic eviscerates jobs throughout our economy, Congress has a rare opportunity to improve the lot of one long-besieged group of workers: creators. Authors, songwriters, photographers, artists, filmmakers, and many other creative professionals are the lifeblood of American cultural innovation. For decades, however, unfettered copyright infringement online has undermined their livelihoods. The effect is especially pronounced for “creative upstarts”—independent creators who rely on copyright income. Many creative upstarts report widespread piracy of their works but feel powerless to stop it. Now, Senator Ron Wyden (D-OR) seems intent on unilaterally terminating a bill that if passed would give indie creators—thousands of whom live in Wyden’s state of Oregon—much needed access to justice. ***

Right now, Congress can fix this problem and offer much-needed support to creators by passing the Copyright Alternative in Small-Claims Enforcement (CASE) Act. This bill would create a voluntary, low-cost small claims system for copyright cases. The CASE Act provides for simplified procedures that the average person could navigate without an attorney, greatly reducing costs. The bill also contains a progressive feature critical for access to justice: cases would be handled remotely, further reducing the cost and burden for both parties. And the process is voluntary so each party can weigh for itself the pros and cons of participating.

To read the rest of the post at IPWatchdog, please click here.

Tags CASE Act, copyright, Eric Priest, Ron Wyden, Sean Pager

The AM-FM Bill and the Status of Terrestrial Music Broadcast Performance Rights

Post author By Joshua Grove
Post date June 1, 2020

The following post comes from David Ward, a rising 2L at Scalia Law who is working as a Research Assistant this summer at CPIP.

U.S. Capitol building By David Ward

This past Wednesday, the Senate Intellectual Property Subcommittee, led by its Chairman, Senator Thom Tillis (R-NC), held a virtual online briefing on the current state of music rights. Specifically, members of the music and broadcast industry debated a bill called the Ask Musicians for Music Act (AM-FM Act), which would create new terrestrial broadcast performance royalties for sound recordings. Some of the biggest names in the music and broadcast industry were invited to testify, including: Harvey Mason Jr., CEO of the Recording Academy; Curtis LeGeyt, COO of the National Association of Broadcasters (NAB); Dr. Richard Burgess, CEO of the American Association of Independent Music (A2IM); Scott Hunter, Executive Director of the National Religious Broadcasters Music License Committee (NRBMLC); and Colin Rushing, Chief Legal Officer of SoundExchange. These panelists represented both musicians and broadcasters, big and small, who have been engaged in a sometimes-tense dialogue about the future of terrestrial broadcasting rights.

For a bit of background, all music we hear on the radio has two copyrights: a copyright for the musical work (lyrics, notes, melodies, chords that an artist writes), and a copyright for the sound recording itself (that a producer or sound engineer usually helps create). The scope of the discussion here is about performance royalties for the sound recording, not the musical work. It should be noted, however, that radio stations still need licenses to play musical works over the air. These are usually obtained in the form of blanket licenses from performance rights organizations (PROs) such as ASCAP or BMI. Blanket licenses allow radio stations to broadcast musical works from the PRO’s repertoire, within the scope of their agreement.

Under the current system, though, radio stations are not required to pay a per-performance royalty when they broadcast a sound recording over a terrestrial broadcast, such as AM or FM radio. However, stations that broadcast over the internet, or any other entity that broadcasts performances digitally (such as a webcast), are required to pay digital performance royalties for the sound recordings they play. This being the 100th anniversary of broadcast radio, the AM-FM Act currently being debated aims to end this exemption that radio broadcasters have enjoyed for exactly 100 years.

Curtis LeGeyt from the NAB and Scott Hunter from the NRBMLC represented the interests of broadcasters who have long opposed the introduction of such a royalty on their expense reports. Mr. Hunter testified that a terrestrial sound recording performance royalty is “unwarranted” and “unnecessary,” and that Congress has repeatedly declined to create such a right even as recently as 2018. In 2018, Congress passed the Music Modernization Act, which made major reforms to music copyrights, including extensive reforms of how royalties are set and split for both musical work and sound recording copyrights. Mr. LeGeyt argued that Congress could have created a terrestrial performance royalty for recordings then, but did not. He further argued that copyrights are statutory devices intended to promote the creation and distribution of works, and that allowing radio to freely broadcast sound recordings best serves the purposes of copyright law.

Both Mr. LeGeyt and Mr. Hunter characterized the exemption as a mutually beneficial promotional tool for performers and broadcasters. They warned of a decline in local radio programming and further financial instability of the industry if new royalties were mandated. Noting the financial instability caused by the coronavirus pandemic, they argued this could be fatal to many local radio stations in the short term as well as disrupt radio business models in the long term.

On the other side of the issue were Harvey Mason Jr. from the Recording Academy, Dr. Richard Burgess from A2IM, and Colin Rushing from SoundExchange. Mr. Mason began his testimony by contrasting our current system with the rest of the world’s; namely, most other major countries have sound recording performance royalties for terrestrial broadcasters. Musicians are some of the hardest hit in the economy during the pandemic, and despite this, Mr. Mason testified, they are still playing free online shows for the benefit of others. This situation underscored the need to do away with the outdated exemption from paying sound recording performance royalties enjoyed by terrestrial broadcasters. Mr. Mason suggested that the AM-FM bill could be included in a new coronavirus relief package, so musicians can recoup some of the losses they have recently experienced.

Dr. Burgess of A2IM echoed these sentiments, adding that musicians are the only copyright owners that are not allowed to profit from the performance of their works over terrestrial broadcasts. In Dr. Burgess’ view, musicians are being forced to subsidize the radio industry even though their own revenues have been decimated.

Colin Rushing of SoundExchange, the company that collects digital performance royalties for sound recordings suggested there are few, if any, major differences between digital and terrestrial broadcasts in the modern age. Most broadcasters are simulcasting online, which already requires them to pay digital (but not terrestrial) performance fees. Many apps and devices also seamlessly transition between digital and terrestrial broadcasts. He testified that the lack of terrestrial performance rights creates a loophole that distorts the market and creates an incentive to invest in old technologies, making it harder for new platforms to compete. Echoing many of his colleagues’ sentiments, he also reiterated that the U.S. is an outlier on this issue and that this harms music creators who are generating value for broadcasters, now more than ever.

Questioning by Senate offices drew out the sharpest differences in positions. Mr. LeGeyt of the NAB and Dr. Burgess of A2IM engaged in a (sometimes terse) dialogue. Mr. LeGeyt painted a picture of mom and pop broadcasters forced to consolidate operations and lay off workers, even before the pandemic, while Dr. Burgess was not persuaded that struggling musicians should therefore be forced to take promotion and exposure as the only consideration for radio plays.

Senator Coons’ office (D-DE) began the staff questioning with something that was likely on everyone’s mind: what level of royalties are at issue. Being the expert in performance royalties, Mr. Rushing from SoundExchange chimed in with a short “we’re not sure” answer. In his mind, and even in the minds of the broadcasters, it would be impossible to speculate. Either the free market would dictate the rates, or some other rate-setting entity would set the rate based on the current market rates. Since the current market rate is zero in the U.S., defining any number would be speculation. However, Mr. LeGeyt was quick to draw a comparison to the royalties they already pay for digital performances, and that they already inhibit the growth of mid- and small-sized broadcasters.

The costs incurred by mid- and small-sized broadcasters was another topic that came up frequently in responses. Mr. Mason of the Recording Academy made a point to share that the proposal would put a cap of $1.50 per day on terrestrial performance royalties for true small and local radio stations. Mr. Rushing of SoundExchange added to this, stating that even most larger radio stations would likely be paying less than $500 per year. The broadcasting representatives again pointed out the already constrained budgets of many stations and that any increase in costs would hurt the industry.

Perhaps the most contentious issue was the purpose of terrestrial radio in the music ecosystem, and the role of “promotion” in that ecosystem. Broadcasters argued that terrestrial radio is and always has been a public service. It provides weather, news, and other important public service announcements for free while also promoting musicians’ work. Therefore, broadcasters should not have to pay performance royalties, as they have not for a century. Music industry representatives, however, argued that providing a public service does not warrant profiting off others’ work for free.

Senator Tillis’ office asked the question that got to the heart of the “promotion” issue: whether radio mainly plays music that is already popular and does not need promotion, or whether sound recordings become popular because they are promoted on the radio. Mr. Rushing of SoundExchange offered his view that it is a bit of both. He and his colleagues did not contest that many artists benefit from the promotion and exposure of broadcast radio plays, but not all of them do. In their opinions, the free market should decide what the rates should be for sound recording performance royalties so that any artists who want to provide their product for free in exchange for promotion and exposure would be able to make that choice. The broadcasters argued that broadcast radio is different than other forms of media, and that the value of promotion has been time-tested.

Although all participants committed to continue good faith discussions on the matter, it does not bode well for a quick agreement that the radio sound recording royalty exemption has already reached its century mark.

Tags AM-FM Act, Chris Coons, David Ward, IP Subcommittee, musical works, performance right organization, PRO, royalties, Senate, sound recordings, SoundExchange, Thom Tillis

Scalia Law Students and CPIP Scholars Make an Impact in Copyright Office Section 512 Study

Post author By Joshua Grove
Post date May 26, 2020

The U.S. Copyright Office released its long-awaited report on Section 512 of Title 17 late last week. The Report is the culmination of more than four years of study by the Office of the safe harbor provisions for online service provider (OSP) liability in the Digital Millennium Copyright Act of 1998 (DMCA). Fortuitously, the study period coincided with the launch of Scalia Law’s Arts and Entertainment Advocacy Clinic. Clinic students were able to participate in all phases of the study, including filing comments on behalf of artists and CPIP scholars, testifying at roundtable proceedings on both coasts, and conducting a study of how OSPs respond to takedown notices filed on behalf of different types of artists. The Office cites the filings and comments of Scalia Law students numerous times and ultimately adopts the legal interpretation of the law advocated by the CPIP scholars.

The Office began the study in December 2015 by publishing a notice of inquiry in the Federal Register seeking public input on the impact and effectiveness of the safe harbor provisions in Section 512. Citing testimony by CPIP’s Sean O’Connor to the House Judiciary Committee that the notice-and-takedown system is unsustainable given the millions of takedown notices sent each month, the Office launched a multi-pronged inquiry to determine whether Section 512 was operating as intended by Congress.

Scalia Law’s Arts and Entertainment Advocacy Clinic drafted two sets of comments in response to this initial inquiry. Terrica Carrington and Rebecca Cusey submitted comments to the Office on behalf of middle class artists and advocates, including Blake Morgan, Yunghi Kim, Ellen Seidler, David Newhoff, and William Buckley, arguing that the notice-and-takedown regime under Section 512 is “ineffective, inefficient, and unfairly burdensome on artists.” The students pointed out that middle class artists encounter intimidation and personal danger when reporting infringements to OSPs. Artists filing takedown notices must include personal information, such as their name, address, and telephone number, which is provided to the alleged infringer or otherwise made public. Artists often experience harassment and retaliation for sending notices. The artists, by contrast, obtain no information about the identity of the alleged infringer from the OSP. The Office’s Report cited these problems as a detriment for middle class artists and “a major motivator” of its study.

A second response to the notice of inquiry was filed by a group of CPIP scholars, including Sandra Aistars, Matthew Barblan, Devlin Hartline, Kevin Madigan, Adam Mossoff, Sean O’Connor, Eric Priest, and Mark Schultz. These comments focused solely on the issue of how judicial interpretations of the “actual” and “red flag” knowledge standards affect Section 512. The scholars urged that the courts have interpreted the red flag knowledge standard incorrectly, thus disrupting the incentives that Congress intended for copyright owners and OSPs to detect and deal with online infringement. Several courts have interpreted red flag knowledge to require specific knowledge of particular infringing activity; however, the scholars argued that Congress intended for obvious indicia of general infringing activity to suffice.

The Office closely analyzed and ultimately adopted the scholars’ red flag knowledge argument in the Report:

Public comments submitted by a group of copyright law scholars in the Study make a point closely related to the rightsholders’ argument above, focusing on the different language Congress chose for actual and red flag knowledge. They note that the statute’s standard for actual knowledge is met when the OSP has “knowledge that the material or an activity using the material on the system or network is infringing” or “knowledge that the material or activity is infringing,” while the red flag knowledge standard is met when the OSP is “aware of facts or circumstances from which infringing activity is apparent.” This difference, the copyright law scholars argue, is crucial to understanding the two standards: while the statute uses a definite article—“the”—to refer to material or activity that would provide actual knowledge, it drops “the” to speak more generally about facts or circumstances that would create red flag knowledge. “In Congress’s view,” the comment concludes, “the critical distinction between the two knowledge standards was this: Actual knowledge turns on specifics, while red flag knowledge turns on generalities.”

The Office went on to state that “a standard that requires an OSP to have knowledge of a specific infringement in order to be charged with red flag knowledge has created outcomes that Congress likely did not anticipate.” And since “courts have set too high a bar for red flag knowledge,” the Office concluded, Congress’ intent for OSPs to act upon information of infringement has been subverted. This echoed the scholars’ conclusion that the courts have disrupted the balance of responsibilities that Congress sought to create with Section 512 by narrowly interpreting the red flag knowledge standard.

Scalia Law students and CPIP scholars likewise participated in roundtable hearings on each coast to provide further input for the Copyright Office’s study of Section 512. The first roundtable was held on May 2-3, 2016, in New York, New York, at the Thurgood Marshall United States Courthouse, where the Second Circuit and Southern District of New York hear cases. The roundtable was attended by CPIP’s Sandra Aistars and Matthew Barblan. They discussed the notice-and-takedown process, the scope and impact of the safe harbors, and the future of Section 512. The second roundtable was held in San Francisco, California, at the James R. Browning Courthouse, where the Ninth Circuit hears cases. Scalia Law student Rebecca Cusey joined CPIP’s Sean O’Connor and Devlin Hartline to discuss the notice-and-takedown process, applicable legal standards, the scope and impact of the safe harbors, voluntary measures and industry agreements, and the future of Section 512. Several of the comments made by the CPIP scholars at the roundtables ended up in the Office’s Report.

In November 2016, the Office published another notice of inquiry in the Federal Register seeking additional comments on the impact and effectiveness of Section 512. The notice itself included citations to the comments submitted by Scalia Law students and the comments of the CPIP scholars. Under the guidance of Prof. Aistars, the students from Scalia Law’s Arts and Entertainment Advocacy Clinic again filed comments with the Office. Clinic students Rebecca Cusey, Stephanie Semler, Patricia Udhnani, Rebecca Eubank, Tyler Del Rosario, Mandi Hart, and Alexander Summerton all contributed to the comments, which discussed their work in helping individuals and small businesses enforce their copyright claims by submitting takedown notices pursuant to Section 512. The students reported on the practical barriers to the effective use of the notice-and-takedown process at particular OSPs. Two problems identified by the students were cited by the Copyright Office as examples of how OSPs make it unnecessarily difficult to submit a takedown notice. Accordingly, the Office called on Congress to update the relevant provisions of Section 512.

Two years after the additional written comments were submitted, the Office announced a third and final roundtable to be held on April 8, 2019, at the Library of Congress in Washington, D.C. The purpose of this meeting was to discuss any relevant domestic or international developments that had occurred during the two prior years. CPIP’s Devlin Hartline attended this third roundtable to discuss recent case law related to Section 512, thus ensuring that CPIP scholars were represented at all three of the Office’s roundtables.

CPIP congratulates and thanks the students of Scalia Law’s Arts and Entertainment Advocacy Clinic for their skillful advocacy on behalf of artists who otherwise would not be heard in these debates.

IP Scholars File Comments with OSTP on Public Access to Scholarly Publications

Post author By Joshua Grove
Post date May 7, 2020

shelves full of books A group of intellectual property scholars filed comments yesterday with the Office of Science and Technology Policy (OSTP), asking it to forgo its plans to make all federally-funded scholarly publications free and open to the public upon initial publication. The comments were submitted in response to a notice of Request for Information (RFI) that was published in the Federal Register seeking recommendations “on approaches for ensuring broad public access to the peer-reviewed scholarly publications, data, and code that result from federally funded scientific research.”

While the RFI did not specifically mention intellectual property rights, it is clear that any proposal to provide free access to federally-funded scholarly publications would have significant ramifications for the copyright owners of those works. The comments argue that any such plan to further lessen the exclusive rights of these owners should be rejected as it “ignores and destroys the resource-intensive review, translation, and commercialization processes required to produce and disseminate these manuscripts” and “confuses the so-called public domain with the public sphere or market.”

The comments are copied below, and you can download them here.

***

Intellectual Property Scholars’ Response to OSTP Request for Information FR Doc. 2020-06622, Regarding “Public Access to Peer-Reviewed Scholarly Publications, Data, and Code Resulting from Federally Funded Research”

May 6, 2020

The Office of Science and Technology Policy (OSTP) issued a Request for Information: Public Access to Peer-Reviewed Scholarly Publications, Data and Code Resulting From Federally Funded Research on February 12, 2020 (RFI).[1] The undersigned intellectual property (IP) scholars submit these Comments under the extended deadline.[2] We appreciate this opportunity to share our views on this important topic.

The RFI directs comments along four vectors: (i) current limitations on effective communication of research outputs and potential responsive changes; (ii) possible actions by Federal agencies to increase free and public access to federally funded research results; (iii) benefits to American science leadership and competitiveness from “immediate” access to outputs of research funded in part by Federal agencies; and (iv) other “information that might be considered for Federal policies related to public access to peer-reviewed author manuscripts, data, and code resulting from federally supported research.”

OSTP has a long and storied history across the twentieth century and down to the present. The Office played key roles in developing both the federal agency research funding system and the technology transfer system that are central policy components in America’s success as the science and technology global leader. While many comments will likely be directed to copyright in the context of scientific journals as commercial market publishers, our contribution prompts OSTP to align any new publication policies with the longstanding science and technology research and development (R&D) policies enshrined in the Bayh Dole Act of 1980 and related regulations for different types of federal research funding.

Federal extramural[3] research funding is divided into four categories: procurement contracts, governed by the Federal Acquisition Regulation (FAR);[4] grants, governed by Bayh-Dole;[5] cooperative agreements, also governed by Bayh-Dole;[6] and “other transactions,” limited to the Department of Defense and arguably governed by neither FAR nor Bayh-Dole.[7]

The purpose behind the distinctions is central to our Comments on the RFI. Whereas procurement contracts are used for the Federal government to acquire goods or services for its own use as any other market purchaser, grants and cooperative agreements are used for private contractors to engage in R&D leading to knowledge and materials that will be used primarily outside of the government. Thus, while title, ownership, or control of procured goods and services can properly vest in the Government, as for any market purchaser, title, ownership, and control of research results funded by grants or cooperative agreements vests in the contractor under the fundamental allocation rule and purpose of Bayh-Dole.[8]

Accordingly, any sense that research results—including inventions, data, or materials (biological or otherwise)—are produced by, or on behalf of, the government is false. To the contrary, the fundamental premise of Bayh-Dole (originating in earlier patent and extramural research funding policies of both the Kennedy and Nixon Administrations) is that title to government funded extramural research results are best left to recipient organizations such as universities (“contractors” in Bayh-Dole parlance) to license to the private sector for commercialization.[9] This is because the Federal government had proven woefully unable to secure the “practical application” of basic and applied sciences research. This meant that the benefits of such research were not realized by the public.

The same logic applies to written materials produced by grant or cooperative agreement funded investigators discussing their research results. Scientific publishing ventures are subject to the same dynamics as are commercialization ventures for technology produced under federally funded research. As scholars have documented, reputable scientific publishing requires costly private investment to sustain the international gold standard of peer review and the level of quality production, graphics, and searchable databases that promote the progress of credible science.[10] While copyrightable works are not covered by Bayh-Dole, neither are they “government works” when produced by grant or cooperative agreement funding recipients. This remains true even after the Supreme Court’s recent decision in Georgia v. Public Resource Organization, Inc.[11] Works commissioned under a procurement contract may be government works, and perhaps even statutory work made for hire, provided there was an express writing to that effect and the subject matter fit within one of the nine enumerated statutory types of works.[12] But again, that is not what is going on in federally funded extramural research occurring under grants and cooperative agreements.

At most, Federal agencies hold a non-exclusive license to use research results arising under grants or cooperative agreements for government purposes.[13] This generally does not include providing these things to the general public as a government service. It is possible that the Government could do so if it was willing and able to pre-empt the entire private market for this product and deliver copies of the patent or copyright protected item to the market that are commensurate with the quality of market participants. But this would require appropriation of massive amounts of taxpayer dollars to recreate what the private sector already provides efficiently.

Further, the fully commercialized versions of goods, services, and peer-reviewed articles that derived in part from federally funded research results are nearly always downstream products produced without government funding. Thus, any government license to research results does not necessarily apply to these finished products. For example, if federal funding led to a patentable invention that could be used in a smartphone, the government license would apply only to that patent and not the entire phone. Likewise, for peer-reviewed publications: to the extent a government use license exists just by virtue of standard agency funding agreements, it only applies to the research results, perhaps in the form of written lab notes.

Accordingly, even OSTP’s 2013 Memorandum directing agencies to require federal funding recipients to allow free public access to the final version of peer-reviewed publications may have been overreach that undercuts Congress’ extramural research policy goals set out in Bayh-Dole. If the Federal government wants to provide peer-reviewed private market produced publications to the public for free, it can procure them through the normal FAR contract system. This will of course cost a lot of money. But the Federal government should not be trying to get for free through the grant and cooperative agreement channels what it would otherwise have to buy in the open market. This principle should apply equally to peer-reviewed scientific publications as it does to other commercial market goods that embody Bayh-Dole subject inventions. The government does not get these goods for free, nor can it direct how contractors make them available to the market.[14]

Romantic notions of “open science” often used to justify open access policies are often based on idealistic myths not supported by the history of science. To the contrary, many of the greatest scientists in the Western tradition were highly protective and secretive with their research. Their processes and data were, after all, their competitive edge in the race for scientific priority and a long and fruitful research agenda. The results of their scientific inquiry, couched as “discoveries” or new laws or principles of nature, needed to be open and replicable, but that did not mean the underlying data or processes did.

While some bemoan “duplicative efforts” as wasteful, many of the most famous scientific races in history were replete with secretive independent traversing of the same ground. In fact, the British Royal Society allowed presentations of even research results to be done in private for awarding scientific priority and credit. This meant that such results were not made public. Ultimately, science seems to work best as a competitive market—at least as far as spurring rapid and pioneering advances. Open access works against this in the vain hope that a non-competitive collective will be equally motivated to long hours and expensive research.

No matter how you look at it, government-mandated immediate open access for copyrighted peer-reviewed manuscripts ignores and destroys the resource-intensive review, translation, and commercialization processes required to produce and disseminate these manuscripts. It confuses the so-called public domain with the public sphere or market. The most important is the latter—are innovative, creative, and valuable new writings being made available to the public in vetted commercially viable forms, perhaps for a fee, or are we simply mandating that inferior versions are made available for free? What is better? History and the market have already given us the answer.

We strongly urge OSTP to refrain from reducing further the already market-disruptive regulation that allows a mere 12-month embargo to recoup major investments in producing and disseminating peer-reviewed publications. Pushing access sooner will destroy the scientific publishing sector—with nothing to replace it in scale or quality—as well as dampen the successful competitive marketplace of scientific research. It will also unbalance the successful premise and system of R&D based off technology transfer under Bayh Dole.

Sandra Aistars*
Clinical Professor of Law
George Mason University, Antonin Scalia Law School

Devlin Hartline
Assistant Professor of Law
George Mason University, Antonin Scalia Law School

Joshua Kresh
Deputy Director, Center for the Protection of Intellectual Property
George Mason University, Antonin Scalia Law School

Adam Mossoff
Professor of Law
George Mason University, Antonin Scalia Law School
Co-Chair of the Technology, Innovation, and Intellectual Property Program
Classical Liberal Institute, New York University School of Law
Senior Fellow & Chair of the Forum for Intellectual Property
Hudson Institute

Christopher Newman
Associate Professor of Law
George Mason University, Antonin Scalia Law School

Sean O’Connor
Professor of Law
George Mason University, Antonin Scalia Law School

Kristen Osenga
Austin E. Owen Research Scholar & Professor of Law
University of Richmond School of Law

Mark Schultz
Goodyear Tire & Rubber Company Endowed Chair in Intellectual Property Law
University of Akron School of Law

[1] 85 F.R. 9488 (Feb. 19, 2020).

[2] 85 F.R. 17907 (Mar. 31, 2020).

[3] “Extramural” refers to research outside government owned and operated facilities. “Intramural” would instead signify research done within government owned and operated facilities.

[4] A procurement contract is used when “. . . the principal purpose of the instrument is to acquire (by purchase, lease, or barter) property or services for the direct benefit or use of the . . . Government; . . . .” 31 U.S.C. § 6303.

[5] A grant agreement is used when “. . . the principal purpose of the relationship is to transfer a thing of value to the . . . recipient to carry out a public purpose of support or stimulation authorized by a law of the United States instead of acquiring . . . property or services for the direct benefit or use of the . . . Government; and . . . substantial involvement is not expected between the executive agency and the . . . recipient . . . .” 31 U.S.C. § 6304.

[6] A cooperative agreement is used when “. . . the principal purpose of the relationship is to transfer a thing of value to the . . . recipient to carry out a public purpose of support or stimulation authorized by a law of the United States instead of acquiring . . . property or services for the direct benefit or use of the . . . Government; and . . . substantial involvement is expected between the executive agency and the . . . recipient . . . .” 31 U.S.C. § 6305.

[7] See GAO, Intellectual Property: Information on the Federal Framework and DoD’s Other Transaction Authority (GAO-01-980T, Jul. 17, 2001) (Statement of Jack L. Brock, Managing Director, Acquisition and Sourcing Management and John B. Stephenson, Director, Natural Resources and Environment, before the Subcommittee on Technology and Procurement Policy, Committee on Government Reform, House of Representatives).

[8] Federal agencies can modify the standard clauses of funding agreements (grants or cooperative agreements) to vest title, ownership, or control of research results in exceptional circumstances, but those have to be justified and documented.

[9] See Sean M. O’Connor, The Real Issue Behind Stanford v. Roche: Faulty Conceptions of University Assignment Policies Stemming from the 1947 Biddle Report, 19 Mich. Telecomm. & Tech. L. Rev. 379, 387-412 (2013), available at http://www.mttlr.org/volnineteen/oconnor.pdf.

[10] See, e.g., Adam Mossoff, How Copyright Drives Innovation: A Case Study of Scholarly Publishing in the Digital World, 2015 Mich. St. L. Rev. 955 (2015).

[11] No. 18-1150, 590 U.S. __ slip op. (2020).

[12] 17 U.S.C. 101, 201(b).

[13] See, e.g., 35 U.S.C. 202(c)(4)

[14] While Bayh-Dole does provide “march-in rights” under 35 U.S.C. 203 that allow the funding agency to grant licenses to the subject invention to third parties, this is only in the case where a contractor fails to achieve “practical application,” in the sense of getting a product embodying the subject invention to the market.

* Affiliations given for identification purposes only

Tags Bayh-Dole, copyright, open access, open-access mandates, OSTP, public access, RFI, scholarly publications, Sean O'Connor

Copyright Notebook: Observations on Copyright in the Time of COVID-19

Post author By Joshua Grove
Post date April 27, 2020

the word "copyright" typed on a typewriter The Indomitable Spirit of Artists

Heroes are everywhere. We all give thanks for the selfless efforts of medical professionals, first responders, delivery drivers, gig economy workers, grocery and pharmacy staff, and the many other individuals who daily place themselves at the center of the coronavirus pandemic in order to make our quarantined lives safe and manageable. Now with working-from-home days blurring into nights and weeks rolling by in an undifferentiated haze, artists, scholars, and the industries that work with them are taking unprecedented steps to bring color, life, and knowledge to our circumscribed lives. Theatrical release movies are streaming to homes, operas and Broadway productions are available on the websites of shuttered arts venues to enjoy for free, bands are playing online gigs, authors have devised ways to make their works available for online enjoyment and distance learning in a myriad of settings, and scholarly publishers and newspapers are making relevant news reporting and research about the coronavirus free to users.

This should not be terribly surprising. Authors and artists of all varieties have always nurtured deep community roots. They are the very types of entrepreneurs and independent businesses who–alongside shop owners and local services–undergird our towns and cities and contribute to our well-being not only through their creativity, but also through their generosity when neighbors seek support. Writing in the New York Times, author David Sax said about the importance of small local businesses:

These are the entrepreneurs who matter now, more than ever. Not the ones on the covers of magazines, not the billionaires and recipients of venture capital checks, whose products we may use, but whose lives are distant and entirely removed from the day-to-day of our communities. If Casper, WeWork or some celebrity’s makeup company doesn’t survive this crisis, the impact on our lives will be negligible. Elon Musk will be fine. But if we lose our barber, the fruit store on the corner or the plumber who saved us in a flood, we will have lost a piece of ourselves.

This is the mindset with which I am approaching copyright in the time of COVID-19.

The National Emergency Library

Sadly, unprecedented moves by artists to share their work with the world on lockdown have not dissuaded opportunistic behavior online. Capitalizing on the shutdown, multi-millionaire Brewster Kahle of the Internet Archive, who has long argued for expanding rights to copy and make copyrighted works digitally available without the permission of authors, announced an “emergency” free library of copyrighted works, available to readers without a waiting list. While Kahle’s Internet Archive has been controversial since its inception, this new iteration apparently removes all limits on the number of users who can check out a work simultaneously – essentially turning it into an all-you-can-read free e-book service. This goes beyond even the limitations applicable to brick-and-mortar libraries that offer electronic lending.

Kahle’s opportunistic move did not pass unnoticed, however. Senator Thom Tillis, who as head of the Senate Subcommittee on Intellectual Property is deeply engaged in reviewing and updating U.S. intellectual property policy, promptly penned a letter to Kahle noting:

I am not aware of any measure under copyright law that permits a user of copyrighted works to unilaterally create an emergency copyright act.

Tillis is right – making the 1.4 million books Kahle has scanned into his database freely available to an unlimited number of users is inconsistent with current copyright law. Moreover, it is a step towards “losing a part of ourselves,” as Sax so aptly puts it. According to the Authors Guild, the mean income for a professional author is $20,300 annually. Authors are the epitome of the types of breadwinners various government programs should currently be trying to prop up, rather than barons of industry who should be taxed for the welfare of others.

While the Internet Archive has reportedly reached an agreement with the University of North Carolina Press and Duke University Press in the past weeks, this agreement is too little, too late, and it represents a pernicious trend among internet industry advocates to infringe first, seek agreement later. Terms like “efficient infringement” have emerged to describe such behavior.

Internet Archive’s behavior threatens to upend the promise of copyright protection as an invitation to a business negotiation between authors and larger, better resourced associates who wish to acquire rights in their works. Practitioners of so-called “efficient infringement” or “permissionless innovation” blatantly challenge individual authors to sue infringers if they dare, or otherwise to take whatever the infringer is willing to offer. The music industry has called this negotiating-with-a-gun-to-one’s-head approach the reason for the “value gap,” which is seen when comparing license terms among internet services that rely on protections like the Digital Millennium Copyright Act (DMCA) safe harbors to avoid liability for infringement and those services that negotiate for rights in the free marketplace. It is not surprising that lopsided business terms result in cases where infringers are empowered by circumstances or the law to adopt a “sue me” approach instead of negotiating in good faith.

Google v. Oracle

Another example of the “efficient infringement” approach to acquiring intellectual property is seen in Google v. Oracle. This long-litigated case will bring a Supreme Court holding on whether companies can slavishly copy the software code of others in order to save R&D and marketing costs. While this is a battle between industry behemoths, the outcome is important to anyone who relies on copyright protection because Google adopted the “sue me if you dare” approach and is effectively arguing that the bounds of fair use should incorporate instances of intellectual property appropriation to avoid business inconvenience.

This case has cost countless millions of dollars to litigate through two jury trials and two federal appeals and is now before the Supreme Court. If this is the path to enforcing one’s rights, it is clear that individuals and small businesses effectively own rights with no remedies should an infringer with deeper pockets emerge. The case likewise demonstrates how litigation can be inefficient and ill-suited to establishing business norms.

Despite the lengthy record, the case is quite straightforward. As Oracle so plainly put it in its brief:

Google has a problem. It committed an egregious act of plagiarism and now needs to rewrite copyright law to justify it. It cannot.

Java SE was one of the most creative and intricately designed works of software ever written. Its elegance attracted a wide audience of developers. Manufacturers of all sorts of devices and competing platform makers clamored to license the Java SE platform. Innovation flourished, just as the Framers imagined, and just as the rest of the American software industry thrived under those same constitutional incentives.

Google wanted its own platform. Given its vast resources, it could certainly have written one. But with a looming existential crisis, there was no time to innovate. Google could have taken any of the several Java SE licenses Oracle offered, but Google rejected Oracle’s compatibility imperative as inconsistent with its commercial objectives.

So Google opted to plagiarize and take the risk. Google copied 11,330 lines of computer code from Java SE, as well as the intricate organization and relationships among the lines of code. Google put the code in its competing product, Android, and successfully pitched it to Oracle’s customers, generating billions of dollars in revenue.

As I (together with other copyright scholars) argued in an amicus brief to the Court:

Congress has addressed the protection of computer software through the Copyright Act, including the code at issue in this appeal. In its 1980 amendments to the Copyright Act, Congress adopted the recommendations of the National Commission on New Technological Uses of Copyrighted Works (CONTU) and recognized computer programs as “literary works” enjoying the full extent of protection under the statute. Even at that relatively early stage in the development of the computer software industry, Congress considered versions of many of the arguments and issues present in this litigation, including whether computer code should be protected as a literary work, the degree to which computer programs can be considered “functional” or necessary “machine-controlled elements” (as opposed to expressive works protectable under the Copyright Act), and the interests of protecting and incentivizing innovation. After careful analysis and debate, CONTU recommended to Congress, and Congress legislated, that computer programs are protected under the Copyright Act with no qualifications that would differentiate software from any other type of literary work under the statute.

Since 1980, software development has grown exponentially, and its application continues to expand into new industries. Congress has amended the Copyright Act to address issues raised by technological advances in particular industries, by enacting, for example, the Computer Software Rental Amendments Act in 1990, the Digital Millennium Copyright Act in 1998, and the Music Modernization Act in 2018. Congress has not, however, amended the Copyright Act to decrease the scope of protection for computer programs or altered the statutory standard for fair use. Because the statutory protections for computer software remain the same as for all other creative works, adopting Google’s position would amount to a judicially created, software-specific amendment. It would also result in singling-out the protections afforded to computer programs, which contradicts the plain text of the Copyright Act.

Google and its amici try to characterize this as “efficient infringement,” or “permission-less innovation.” Yet its conduct is entirely contrary to the goals of copyright law as expressed in the Copyright Act or the Constitution. As a result, there is no reason to incorporate these considerations into fair use. It is clear that purposeful copying to avoid business inconvenience is not fair use, either in the statute as enacted or as interpreted by courts. Although Google casts its theory as “software-specific,” there is no reason why infringing parties could not regularly use it to justify copying any kind of protectable expression. Thus, to expand the fair use doctrine in the way Google advocates would set a dangerous precedent not limited to the software industry.

The Court has announced that it will begin hearing certain oral arguments by phone during the pandemic shutdown, but Google v. Oracle is not (yet) among those cases. As of April 13, 2020, the case was postponed to the October term.

One final (but somewhat different because it involves a state) recent example of an entity acting on the principle of “efficient infringement” occurs in the case of Allen v. Cooper. This case raises state sovereign immunity as a defense, but the underlying fact pattern is hauntingly similar.

Allen v. Cooper

The Supreme Court ruled in Allen v. Cooper that it violates state sovereign immunity to expose state entities to liability for alleged copyright infringement, absent the state’s consent.

As covered by Devlin Hartline here on the CPIP blog, the case involved “both actual and metaphorical pirates.” The actual pirate was Blackbeard, whose ship went down near the North Carolina coast in the 1700s. The metaphorical pirates are the government of the state of North Carolina, which allegedly infringed, then settled, then allegedly infringed again, the copyrighted photos and videos of the wreck shot by underwater photographer Rick Allen. Not content to repeatedly infringe Allen’s work, the state Legislature additionally passed a law deeming all photographs and videos made of North Carolina shipwrecks to be a matter of public record, and thus free for public use. Although Allen claimed that the state had committed willful infringement, the Supreme Court ultimately sided with North Carolina in ruling the Copyright Remedies Clarification Act of 1990 unconstitutional and holding that the Eleventh Amendment prohibits private actions against the state without the state’s consent.

As it stands, this case bodes ill for anyone who makes their living in the knowledge economy. If you create, research, code, write, document, interpret, or otherwise create intellectual work product that a state or state employee deems of value, the state apparently can take your work without permission. Although this is a more definitive statement of the lay of the land than was previously clear (since earlier case law had considered patent infringement, which differs in some relevant ways from copyrights), it is not altogether unexpected. Nevertheless, state infringements of copyright have been a growing problem. In the twenty years since the Fifth Circuit opined in Chavez v Arte Publico Press that there was no significant problem of copyright infringement by the states enabled by the Eleventh Amendment, more than 150 copyright infringement cases have been filed against states.

Unfortunately, the Court ruled that the CRCA was unconstitutional in its abrogation of state sovereign immunity because it did not properly link the CRCA to the prevention of unconstitutional injuries like the deprivation of property under Section 5 of the Fourteenth Amendment of the U.S. Constitution. Although Allen lost his appeal, the Supreme Court all but invited new legislation by Congress:

Congress likely did not appreciate the importance of linking the scope of its abrogation [of state sovereign immunity rights when it passed the CRCA] to the redress or prevention of unconstitutional injuries—and of creating a legislative record to back up that connection. But going forward, Congress will know those rules. And under them, if it detects violations of due process, then it may enact a proportionate response. That kind of tailored statute can effectively stop States from behaving as copyright pirates. Even while respecting constitutional limits, it can bring digital Blackbeards to justice.

Until Congress returns to normal business and can take this matter up, there are a few issues any potential drafters of new legislation should bear in mind.

First, as the Court explained, it will be important to link any new statute abrogating state sovereign immunity to the redress or prevention of unconstitutional deprivations under Section 5 of the Fourteenth Amendment. This means limiting any new legislation to violations of the Due Process Clauses of the Constitution. Next, it will be important to create a legislative record noting the scope of the problem justifying the proposal, given the Fifth Circuit’s comments in Chavez, which failed to recognize the volume of lawsuits being filed against states for copyright infringement.

It is also wise to articulate some of the numerous reasons why state remedies are inadequate to deal with the infringements of copyright by states or their instrumentalities. Because federal copyright law preempts state law, and copyright matters are tried only in federal courts, there are no plausible avenues for states to create novel, recognizable causes of action for infringement under their own laws. Moreover, in addition to the federal doctrine of state sovereign immunity, states are typically also immune from suit in their own jurisdictions; thus, there are not likely to be any state common law-created remedies. Because states are in the best position to articulate and demonstrate the adequacy of state remedies, if any, the burden of doing so should rest with the state.

Finally, it is worth considering that only federal law can provide the uniform protection against state infringements that authors require in order to publish their works. Thus, Congress should not delay acting to take up the Court’s invitation to bring state digital Blackbeards to justice.

Reflecting on the above cases and controversies as I cozy up to my laptop or sign into a virtual meeting, I am at once thankful for the technology that allows me to connect to others and to keep working, and fearful for my friends and clinic clients who are facing existential challenges to their livelihoods. These cases, similar to many before them, illustrate how intertwined we all are as users and creators of works. It is my hope that we all will use this quieter time to contemplate how interconnected we truly are, and that we will emerge from quarantine to embrace the spirit of the oft-heard virus slogan “we are all in this together.”

Tags Allen v. Cooper, Authors Guild, Brewster Kahle, copyright, efficient infringement, Google v. Oracle, Internet Archive, National Emergency Library, permissionless innovation, Sandra Aistars, Thom Tillis

IP Industries Step Up in This Time of Crisis

Post author By Joshua Grove
Post date April 9, 2020

the word "inspiration" typed on a typewriter The global COVID-19 pandemic has challenged multiple aspects of modern society in a short time. Health and public safety, education, commerce, research, arts, and even basic government functions have had to change dramatically in the space of a couple months. Some good news in all this is the response of many companies in the intellectual property (IP) industries: they are stepping up to make sure crucial information and materials are available to speed research and development (R&D) towards vaccines, therapeutics, and medical devices. This blog post gives a sampling of the current initiatives facilitating the best innovative work the world has to offer.

Bio-pharmaceutical companies

Bio-pharmaceutical (bio-pharma) companies have been leading the charge, collaborating with academic and government partners to advance vaccine and therapy candidates on a fast track. While there have been isolated stories of some IP-related issues for rapid deployment and use of medical devices such as ventilators, the overall message is clear that research, development, and deployment have not been hindered by IP rightsholders. In fact, problems for distribution of medicines, personal protective equipment, and medical devices have little to do with IP rights but rather with hoarding and nationalistic impulses by governments.

Examples of rapid response are abundant. In February, the Department of Health and Human Services and its Biomedical Advanced Research and Development Authority (BARDA) partnered with the Janssen Research & Development unit of Johnson & Johnson to investigate a promising vaccine candidate. Janssen also committed to invest in the scale-up of production and manufacturing capacities to produce the vaccine candidate if it succeeds through clinical trials. By mid-March, 50 drugs that might fight the virus had been identified by collaborations of hundreds of scientists. Research continues apace and 80 clinical trials are proceeding, some on fast track status including a potential vaccine.

Beyond its core R&D, regulatory, manufacturing, and distribution mission, the bio-pharma industry is providing direct support to many places in need. This includes donations of medical supplies and personal protective equipment (PPE), existing treatments and medicines, and monetary and in-kind support.

At the same time, private incentives are more important than ever to get novel vaccines, drugs, and devices out to the world in safe, efficacious form and at scale. Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases, has long recognized that exclusive licenses of IP to bio-pharma industry partners are necessary to get innovative vaccines and drugs to the public:

“We always need a pharmaceutical partner,” [Fauci] told CQ Roll Call in October 2017. “I can’t think of a vaccine, even one in which we’ve put substantial intellectual and resource input, that was brought to the goal line without a partnership with industry. So this is a very natural process that we’re doing right now.”

He argued that for vaccines like Zika, which might predominantly be used in low-income countries, drugmakers don’t see a lot of financial incentive to get involved, which is why the NIH needs to grant exclusive licenses. But he argued that the process hasn’t had an impact on vaccine affordability.

“I have not seen in my experience situations in which we were involved in the development of a vaccine, particularly for low- and middle-income countries that really needed it, where the pharmaceutical companies priced it out of their reach,” Fauci said.

Likewise, as noted innovation scholars Daniel J. Hemel and Lisa Larrimore Ouellette point out in a recent article, Innovation Policy Pluralism, multiple vectors of public and private incentives and resources work together to advance pioneering innovation. Even in countries with a national health or single payer system, the government health program does not manufacture vaccines, drugs, or devices. Instead, it relies on private firms that in turn work closely and well with public and academic researchers to identify pressing problems, locate relevant basic science advances, and then translate those into actual vaccines, therapies, or devices.

The myth of patients and the public “paying twice” for bio-pharma innovation arising from public-private partnerships is pernicious. It conflates the distinction between basic science research and drug or vaccine candidates, on the one hand, with compounds that can be produced at scale, distributed safely, and that have passed arduous clinical trials to demonstrate safety and efficacy. In the United States, private companies must foot the entire bill for these clinical trials, which run into hundreds of millions of dollars over three phases that enroll thousands of subjects. Simply stated, publicly funded research does not result in a substance or compound that can be manufactured and distributed as is with no further R&D or clinical trials.

A related myth is that governments should use compulsory licenses and similar mechanisms to bypass IP rights holders in an effort to speed research and delivery of drugs and vaccines—when they emerge—to the public at low to no cost. First, there are important distinctions between compulsory licenses, U.S. Bayh-Dole style march-in rights, and government use under statutory provisions like 28 USC 1498, which we have outlined here. But across all of them, IP rights holders must still be compensated at a fair market license rate. Thus, there are no “savings” of IP royalties that could lower the price of vaccines or drugs. This makes sense as we don’t force manufacturers to produce drugs or vaccines for free. Even the Defense Production Act merely directs production, it does not require manufacturers to produce goods for free.

Finally, even if patents could be disregarded, we should be careful about encouraging “open source” or amateur production of regulated devices like ventilators. While the FDA has authorized some limited modifications of approved ventilators to accommodate the exigencies of COVID-19, this does not create a free-for-all in which wholesale changes or entirely new designs of the device or its components can be used. We need to take care that these modifications or new designs are actually safe and efficacious. Thus, while innovation like that of famed inventor James Dyson is most welcome, it does not actually solve the immediate problem of a shortage of ventilators as national regulators must still test and approve these untested devices for medical use. And at any rate, Dyson is not offering their new ventilators for free, even as they are designed to be produced at lower costs and sell at a lower point price in the market.

Thus, we need the bio-pharma industry more than ever to get through this pandemic. Large established firms and nimble start-ups have the resources and expertise to innovate and produce vaccines, drugs, and devices that will pass regulatory muster for safety and efficacy. Now is not the time to attack the patent system and weaken incentives for full-steam-ahead bio-pharma and medical device R&D.

Scientific publishing

Similar to the bio-pharma companies, publishers have been leading the way in making crucial scientific and technological information widely available in order to help fight the global coronavirus pandemic. An open letter from Kelvin Droegemeier, Director of the White House Office of Science and Technology Policy (OSTP) and member of President Trump’s Coronavirus Task Force, issued the call to arms last month (for example, see here, here, and here). Joined by government science leaders from eleven other countries—Australia, Brazil, Canada, Germany, India, Italy, Japan, Republic of Korea, New Zealand, Singapore, and United Kingdom—the letter called for publishers to make all research and data related to the coronavirus available immediately to the public. Publishers were quick to respond positively to the letter, pointing out that many journals had already been opened up to the public in an effort to support the dissemination of important scientific research and data when it is needed the most.

In the letter, the government science leaders stated: “To assist efforts to contain and mitigate the rapidly evolving COVID-19 pandemic, basic science research and innovation will be vital to addressing this global crisis. Given the urgency of the situation, it is particularly important that scientists and the public can access research outcomes as soon as possible.” The leaders asked the publishers to voluntarily agree to make their coronavirus-related publications, and the data supporting them, immediately accessible in PubMed Central and other public repositories. PubMed Central refers to the digital archive of biomedical and life sciences journal literature at the U.S. National Institutes of Health’s National Library of Medicine. The leaders also requested that the information be made available in both human and machine-readable format to allow for text and data mining using artificial intelligence.

The same day that the government science leaders sent their letter, Maria Pallante, President and CEO of the Association of American Publishers (AAP), issued a statement noting that the organization and its members would be happy to continue doing their part in making the research and data available to the public:

Publishers purposefully and continuously contribute to the advancement of science and medicine by investing billions of dollars in producing and disseminating high-quality, peer-reviewed journal articles. In this urgent and serious environment, we are grateful to the many publishers who are doing their part to communicate valuable discoveries, analyses, and data as quickly as possible, including by making their copyrighted articles pertaining to the virus freely available for public use during this crisis, in both text and machine-readable formats. Many publishers – both commercial companies and nonprofit societies – have been doing so for weeks.

Likewise, Elsevier, which specializes in publishing global information on science and health, has taken the lead in ensuring that relevant scientific information is available to the public. Back in January, Elsevier set up its Novel Coronavirus Information Center, offering free health and medical research information on the coronavirus and COVID-19, the disease that is causes. The Information Center is updated daily with the latest research information, including links to nearly 20,000 peer-reviewed journal articles on its ScienceDirect platform that are curated by clinicians and other experts. The information is intended for use by practitioners, such as nurses and doctors, as well by patients and their families. In response to the letter from the government science leaders, Elsevier announced in a press release that same day that the information would be made available to PubMed Central and other publicly funded repositories, including in machine-readable format that could be used for full text and data mining.

Kumsal Bayazit, the CEO of Elsevier, also released a statement that day underscoring Elsevier’s continued leadership on this front and concluding:

In working with the White House to improve the discoverability and utility of this important body of knowledge, we are now making it available to PubMed Central and other publicly funded repositories such as the WHO COVID database for full text and data mining and without any limitations for as long as needed while the public health emergency is ongoing. Through this partnership we hope to help researchers to keep up with the rapidly growing body of literature and identify trends as countries around the world address this global health crisis.

Numerous other publishers have stepped up as well. Wiley announced that it “is making all current and future research content and data on the COVID-19 Resource Site available to PubMed Central” and “other publicly funded repositories, such as the World Health Organization (WHO) COVID-19 database and Wellcome Trust.” The Resource Site was set up by Wiley in February in order to ensure rapid, public access to COVID-19 research, and in response to the request of the government science leaders, Wiley is now inputting that information into PubMed Central and other publicly-accessible databases. Likewise, Springer Nature stated: “We have made available, for free, all relevant research we have published and continue to publish, [and] are strongly urging our authors submitting articles related to this emergency to share underlying datasets relating to the outbreak as rapidly and widely as possible.” Other publishers, such as American Chemical Society, PLOS, STM Publishing, IOP Publishing, Emerald Group Publishing, F1000 Research, and eLife Research, have committed themselves to the cause of making their coronavirus research and data available publicly.

It is not just scientific research that is being freely shared by publishers. Textbooks for students affected by the pandemic have been made available as well. Wiley recognized the need “to ensure instructors who need to teach remotely have the necessary tools to help their students,” and it opened up its online textbooks so that instructors “can receive free access for their students for the remainder of the Spring 2020 term.” Barnes & Noble announced that it was joining VitalSource and other leading publishers to provide free online textbooks for students at schools where it operates a campus bookstore. Michael P. Huseby, CEO and Chairman of Barnes & Noble Education, said: “Our top priority remains providing schools and students with solutions during this time of unprecedented disruption, while simultaneously protecting the health and safety of our employees and customers.” Other textbook publishers, including Cengage, Gale, Cambridge University Press, among many others, have done the same in order to make the transition to online learning as smooth as possible by ensuring that students have online access to the textbooks that they need.

Tags AAP, Anthony Fauci, bio-pharma, coronavirus, COVID-19, Elsevier, FDA, IP licensing, James Dyson, Maria Pallante, publishers, PubMed, Section 1498, vaccine, Wiley

Supreme Court Paves Way for Revoking State Sovereign Immunity for Copyright Infringement

Post author By Joshua Grove
Post date March 31, 2020

U.S. Supreme Court building Last week, the Supreme Court handed down its unanimous judgment in Allen v. Cooper, a copyright case involving both actual and metaphorical pirates. The actual pirate was Edward Teach, better known as Blackbeard, who captured a French ship in the Indies, renamed it Queen Anne’s Revenge, used it for piracy, and then later ran it aground near the North Carolina coast in 1718. The shipwreck was discovered nearly three centuries later in 1996 by a marine salvage company named Intersal. North Carolina, the owner of the shipwreck, entered into an agreement with Intersal for its recovery, and Intersal in turn hired Rick Allen, an underwater photographer, to document those efforts through video footage and still images.

Enter the metaphorical pirates. Allen accused North Carolina of infringing his copyrights in the videos and images, which led to a settlement agreement between the parties in 2013 and the state paying Allen $15,000 for any past infringement in 2014. However, even after the settlement agreement, Allen claimed that North Carolina continued to use his video footage and still images without permission. In fact, the state legislature passed a law declaring all photographs and video recordings of its shipwrecks to be a “public record” and thus free for all to use in 2015. Upset at the turn of events, Allen filed suit in the Eastern District of North Carolina in late 2015, with the Governor of North Carolina as the lead, nominal defendant.

Allen sought to have invalidated as unconstitutional and unenforceable North Carolina’s law purporting to inject his videos and images into the “public record,” and he claimed that the state was liable for willful copyright infringement. North Carolina moved to dismiss the complaint, arguing that it had sovereign immunity under the Eleventh Amendment, which bars suits against a state by private individuals in federal courts without the state’s consent. In its unanimous judgment, the Supreme Court sided with North Carolina, holding that the state’s sovereign immunity trumped Allen’s claims. This means that, as of now, states are free from liability for copyright infringement. But, in so holding, the Supreme Court paved the way for how Congress could revoke this constitutional protection from the states.

To understand the Court’s suggestion, a little background information is needed. Under the Copyright Act of 1976, it was generally understood that states could be liable for copyright infringement, even though this was not expressly spelled out in the Act. That implicit understanding was called into question in the Supreme Court’s 1985 decision in Atascadero, which held that the waiver of sovereign immunity by a state must be “unequivocal.” Courts then applied that holding to find that the Copyright Act did not clearly abrogate state sovereign immunity. This led to Congress passing the Copyright Remedy Clarification Act (CRCA) in 1990, which expressly abrogated state sovereign immunity for copyright infringement.

The CRCA, codified in Section 511, provides in part:

Any State, any instrumentality of a State, and any officer or employee of a State or instrumentality of a State acting in his or her official capacity, shall not be immune, under the Eleventh Amendment of the Constitution of the United States or under any other doctrine of sovereign immunity, from suit in Federal court by any person, including any governmental or nongovernmental entity, for a violation of any of the exclusive rights of a copyright owner provided by sections 106 through 122, for importing copies of phonorecords in violation of section 602, or for any other violation under this title.

When Congress enacted the CRCA in 1990, it was focused on exercising its Article I power under the Copyright Clause. And for good reason. A year earlier, in Union Gas, the Supreme Court had held that Congress could abrogate state sovereign immunity by utilizing an enumerated power under Article I—there, the Commerce Clause. However, in 1996, the Supreme Court expressly overruled Union Gas in Seminole Tribe, holding that Congress could not abrogate sovereign immunity under Article I. That decision was later walked back somewhat in Katz, where the Supreme Court carved out an exception in 2006 for the Bankruptcy Clause.

Allen argued that, as in Katz, an exception to Seminole Tribe should also be made for the Copyright Clause. The Court in Katz reasoned that the states submitted to the supremacy of the federal Bankruptcy Clause at the Constitutional Convention. So too, argued Allen, with the Copyright Clause. But Justice Kagan, who penned the opinion of the Court on behalf of herself and six other Justices, rejected this argument as foreclosed by Florida Prepaid, where the Court had held in 1999 that neither the Patent Clause nor the Commerce Clause could be used to revoke state sovereign immunity for patent infringement liability. Ruling for Allen here would mean overruling Florida Prepaid, and the Court, citing stare decisis, was unready to make that move.

But not all hope was lost for Allen. Section 5 of the Fourteenth Amendment provides another path to revoking state sovereign immunity. Under Section 5, Congress may pass “appropriate legislation” to protect persons from a state deprivation of property without due process of law. A law is “appropriate,” Justice Kagan wrote, where there is “a congruence and proportionality between the injury to be prevented or remedied and the means adopted to that end.” Infringement by the states certainly does deprive copyright owners of a property interest, the Court noted, but only if that infringement is intentional or reckless. Negligent infringement does not count. Nor does it count if the state offers an adequate remedy for the deprivation.

In assessing the “congruence and proportionality” of the CRCA, the Court examined the record behind it to understand the nature and extent of the state copyright infringement that Congress intended to address. The timing of the CRCA’s enactment becomes critical here. Recall that Congress thought it was legislating under Article I, not Section 5 of the Fourteenth Amendment, so it did not create a record geared for a Section 5 analysis. Nor did it narrowly tailor the CRCA to reach only intentional or reckless deprivations that were not adequately remedied by the states. Justice Kagan pointed out these shortcomings to hold that Allen’s Section 5 argument failed since the record was too thin and the CRCA swept too far.

The Court heavily discounted the evidence that was in the record when Congress enacted the CRCA. Indeed, Congress asked then-Register of Copyrights Ralph Oman to prepare a report documenting the problem. The lengthy report was a year in the making, and it included comments and letters from numerous copyright owners complaining about copyright infringement by the states. There were hearings in both the Senate and House that generated hundreds of pages of testimony. And both the Senate and House issued reports explaining the need for the CRCA. While the district court below found that there was “sufficient evidence” to sustain the abrogation of state sovereign immunity under Section 5, the Supreme Court was unimpressed with the evidence in the record.

However, the Court did provide a roadmap for how Congress could develop a satisfactory record and craft a statute that would pass muster under Section 5 of the Fourteenth Amendment:

Congress likely did not appreciate the importance of linking the scope of its abrogation to the redress or prevention of unconstitutional injuries—and of creating a legislative record to back up that connection. But going forward, Congress will know those rules. And under them, if it detects violations of due process, then it may enact a proportionate response. That kind of tailored statute can effectively stop States from behaving as copyright pirates. Even while respecting constitutional limits, it can bring digital Blackbeards to justice.

Thus, Congress could draft a more narrowly focused law abrogating state sovereign immunity for intentional or reckless copyright infringement, and it would be upheld if the record shows that the extent of the harm is proportionate to the response and that there are inadequate remedies available in the states. Congress has already gathered some relevant evidence. For example, there is the General Accounting Office report on state sovereign immunity for infringement actions from 2001 and there is the Senate hearing on state sovereign immunity and protection of intellectual property from 2002. Both of those records were generated when Congress realized that Article I might not support the CRCA after the Supreme Court handed down Florida Prepaid, and they contain further evidence of copyright infringement by the states.

If Congress were to hold more hearings, it could start by receiving testimony from the people and organizations that filed amicus briefs in support of Allen with the Supreme Court in this very case. The amicus briefs from Recording Industry Association of America et al., American Society of Media Photographers et al., Software & Information Industry Association, Oracle America, Dow Jones, Copyright Alliance et al., David Nimmer et al., Ralph Oman, and others highlight widespread copyright infringement by the states. Hopefully, Congress will take the hint from the Court and pass another law abrogating state sovereign immunity for copyright infringement. Sadly, it would probably not be too difficult for Congress to create a robust record that could survive judicial scrutiny under Section 5 of the Fourteenth Amendment.

Tags Allen v. Cooper, copyright, copyright infringement, Florida Prepaid, Justice Kagan, Ralph Oman, Rick Allen, Seminole Tribe, state sovereign immunity

Proposed Open Access Regulation is a Solution in Search of a Problem

Post author By Joshua Grove
Post date December 20, 2019

a lightbulb shattering Earlier this week, a coalition of over 125 publishers and non-profit scientific societies joined the Association of American Publishers (AAP) in a letter to the White House expressing serious concerns with a proposed Administration policy that would override intellectual property rights and threaten the advancement of scientific scholarship and innovation. In a flawed attempt to advance open access goals, the policy would require the free and immediate distribution of any proprietary articles that report on research funded by a government agency. But overwhelming opposition by dozens of the most esteemed medical societies and research organizations reveals an ill-conceived and hasty proposal that would not only disregard long-established intellectual property rights, but would also adversely affect U.S. jobs, research, innovation, and global competitiveness.

Like other open access mandate proposals in the past, there has been no evidence offered that the untested models are viable or sustainable or that there are systematic failures in the current scholarly publishing market. In a policy brief published in 2017, CPIP identified similar proposals as nothing but solutions in search of a problem—clear examples of regulatory overreach lacking any empirical evidence of why they are needed and how they would be beneficial.

Proposed Policy Eliminates Any Opportunity to Commercialize

Proprietary articles that report on federally funded research—such as those published in leading medical and scientific journals—are currently subject to public access mandates that require them to be made publicly available no later than 12 months after publication. These mandates are meant to balance the interests of the public in accessing these works with those of publishers and non-profit organizations that bear the costs of producing them. It’s a framework that, while not perfect, reflects the Constitutional objective of securing exclusive rights to promote the progress of science and the useful arts.

Notwithstanding this long-understood trade-off between access and exclusivity, the proposed policy would require the immediate and free distribution of journal articles reporting on any amount of federally funded research. If implemented, the proposal would deny publishers any opportunity to recoup the investments made in development of these labor and cost-intensive works, and many journals and research organizations would simply no longer be able to operate. While the proposal may be rooted in a desire to benefit the public, its complete eradication of the already short 12-month embargo reveals a troubling unawareness of existing markets, the critical role of publishers, and the value of intellectual property.

Untested Model Reflects Unawareness of Creative Ecosystems

Unfortunately, proposals like this reflect a belief by some that in the digital age publishers are merely intermediaries who restrict access to works. Those who promote this narrative also tend to favor short-term access and distribution over sustainable industries, long term R&D, and free markets, but their efforts to impose sweeping open access provisions reveal an ignorance of the inner workings and contributions of the publishing industry.

The reality is that even when federal funding exists for underlying research, significant investments are required by non-profit journals and publishers to translate the research into high-quality articles. These organizations must dedicate time and resources to the review and selection of articles, management of the peer review process, editing, curating, distributing, and long-term stewardship.[i] The publishing industry employs thousands of Americans to carry out these tasks, and they fund their efforts at no cost to taxpayers. Additionally, the sale of journal subscription in hundreds of foreign countries contributes significantly to the U.S. economy and trade balance.

Perhaps most disturbing is that those promoting the proposal seem unaware or unconcerned with the potential devastating impact the policy would have on publishing and scientific communities and America’s leadership in research and innovation. Stakeholders representing the industries that stand to be most affected by an unfettered and unproven open access policy have been left out of discussions, resulting in an ill-considered and inequitable proposal. Furthermore, the fact that the details of Administration policies are sometimes not disclosed until they are announced and implemented raises serious questions about the development of a policy that could have such a significant impact on industries, jobs, and the U.S. economy.

Strong Opposition to an Unsound Policy

Taking into account these numerous problems, it’s not surprising that stakeholders have now joined together to voice their opposition to the proposed policy. Venerable institutions such as the American Medical Association, the American Cancer Society, and the New England Journal of Medicine are just a few of the dozens of scientific, medical, and publishing organizations to challenge the proposal. In addition to these stakeholder organizations, Senator and Chairman of the Subcommittee on Intellectual Property Thom Tillis recently voiced his concerns with the proposal in a letter to Secretary of the Department of Commerce, Wilbur Ross, and to White House Chief of Staff, Mick Mulvaney. He writes:

If the current policy is changed—particularly without benefit of public hearings and stakeholder input—it could amount to significant government interference in an otherwise well-functioning private marketplace that gives doctors, scientific researchers and others options about how they want to publish these important contributions to science.

As Senator Tillis and others point out, the proposed policy has been put forward with no input from stakeholders or public comment. No evidence has been presented that a revised policy is needed, nor has the existing marketplace been shown to be dysfunctional.

While the wide distribution of and access to scholarly articles is critical to advancing research and education, it shouldn’t be so overvalued as to disregard all that goes into producing them and the associated intellectual property rights. To do so would represent a short-term fix to a problem that has not been proven to exist and result in untold damage to publishing industries, the economy, and ultimately the public.

[i] For a detailed account of the value-add services provided scholarly publishers, see Professor Adam Mossoff’s article How Copyright Drives Innovation: A Case Study of Scholarly Publishing in the Digital World.

Tags Adam Mossoff, copyright, Kevin Madigan, open access, President Trump

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