Did Homeland Security Make Up A Non-Existent Criminal Contributory Infringement Rule In Seizing Domain Names?

from the questions,-questions... dept

We've been writing a lot about the highly questionable seizure of domain names by Homeland Security's Immigration & Customs Enforcement (ICE) group here over the last couple of months. The deeper you dig, the more ridiculous it gets. If you look over the full affidavit written by ICE special agent Andrew Reynolds, you realize that there are two basic elements to the claim of criminal copyright infringement that justifies the seizure of the domain name: (1) that the site links to a fair amount of content that is deemed infringing and (2) that it "profits" from this in the form of advertising.

There are a variety of problems with this reasoning in general, some of which we discussed in our recent post about the liability for sites (such as Twitter) which users use to post links to infringing content. Of course, the general response to this is that the issue of collecting a large number of such links is evidence of contributory copyright infringement in the form of "inducement." And this is where things may get tricky for Homeland Security in pushing its claims. In our comments recently there was a very interesting discussion on this issue, highlighting the fact that there is no such thing as criminal copyright inducement.

It starts out with the recognized fact that linking alone is not direct infringement, but could possibly be considered contributory infringement. However, as we've pointed out for years, contributory copyright infringement is not found in the Copyright Act but, rather, is something that the courts have more or less made up as they went along, as a form of common law. In fact, a few years back when some in Congress tried to explicitly put "inducement" into the statute with the INDUCE Act, Congress chose not to pass it. Instead, the main support for inducement as copyright infringement comes today from the Grokster decision in the Supreme Court, which explicitly notes that the Copyright Act has no such inducement standard but that it comes from common law principles that were developed around civil copyright infringement. There are serious problems with the Grokster court's interpretation of contributory copyright infringement, but we'll ignore that for now and focus on the fact that it really only discussed inducement in civil cases.

In other words, there's nothing indicating that criminal copyright inducement exists. Yes, the courts have said it's possible in civil cases, but there's no such support for making it a crime. It appears that Homeland Security seems to have just made this part up and assumed that such a crime must exist. That seems rather troubling. In fact, in a paper by law professor Mark Batholemew from a couple years ago, he highlights how contributory copyright infringement does not seem to fit with criminal copyright law, if you look at the history of copyright law and the idea of contributory infringement.

The full paper is worth digging into. It goes through the history of contributory infringement in copyrights and patents and, then, compares it to the idea of "accomplice" liability in criminal law (which is, surely, where Homeland Security will claim this made up criminal inducement comes from). Yet, as Bartholomew notes, the situations are quite different:

The analogy between accomplice liability and contributory infringement fails given careful consideration of the reasons behind imposing criminal sanctions on indirect actors. Accountability for accomplices requires a tight nexus between the mental state of the defendant and the ultimate criminal act committed by another. This paradigm cannot be used, however, to structure contributory infringement law given the different theoretical bases for the two secondary liability regimes and the particular evidentiary issues accompanying infringement.

The paper highlights the much higher evidentiary requirements to prove any sort of criminal accomplice liability, rather than typical contributory infringement. Yet, from Homeland Security's affidavit, it appears no such effort was made to actually reach the evidentiary hurdles for showing probable cause for criminal accomplice liability. Instead, the focus is mainly (though not even sufficiently) on the standards for civil copyright infringement.

That seems like yet another rather big problem for Homeland Security and the Justice Department with these seizures.

Filed Under: contributory infringement, copyright, homeland security, inducement

isoHunt Appeals Process Begins

from the not-so-simple dept

As we're still left scratching our heads over the US government's botched affidavit to seize Torrent-Finder, that includes numerous technical and legal errors -- and most importantly, does not take into account the First Amendment implications of domain name seizures -- it's worth remembering that a site that has a few similarities to Torrent-Finder, IsoHunt, is still involved in a legal fight concerning its operations.

While we keep hearing defenders of the domain name seizures claim that it's somehow "obvious" that Torrent-Finder is guilty of criminal copyright infringement, it pays to remember that IsoHunt, which is being charged with civil copyright infringement (which has a lower bar) has caused something of a stir in legal circles. The original ruling on IsoHunt broke some new ground in actually being one of the first (and perhaps most high profile case) to use the whole "Red Flag" claim to make IsoHunt guilty of contributory infringement. This is why lots of other cases now cite the district court's ruling in the IsoHunt case -- because it's really the only case that recognizes such "general knowledge" as removing DMCA safe harbors.

In other words, it's still a pretty open question how the courts will actually rule on this issue -- and yet Homeland Security and its supporters somehow think it's "obvious" that Torrent-Finder is even more guilty, despite a lack of any actual charges or a full trial? In its appeal, IsoHunt questions whether or not the injunctions placed by the judge in the district court ruling (who, it should be noted, still lets IsoHunt continue to exist, if in a modified form -- unlike the seizures) are violating the First Amendment in forcing search engines to somehow pre-censor their results, based on no factual evidence of infringement.

There certainly may be additional evidence that makes IsoHunt guilty of contributory infringement, but it's certainly not a clear cut question (though I can predict some folks in the comments will claim otherwise). However, considering that this legal battle is still being fought, it seems even more ridiculous for Homeland Security (or its recent college grad ICE agent) to declare that another search engine is somehow obviously guilty of criminal copyright infringement.

Filed Under: appeals, contributory infringement, copyright, isohunt

Gibson Sues Everyone Over Paper Jamz Paper Guitars, Specifically Goes After eBay

from the that's-not-going-to-work dept

Eric Goldman points us to the news that the (notoriously litigious) Gibson guitar company is suing a whole bunch of companies for selling the new "Paper Jamz" paper multi-touch guitars. If you haven't seen these things, they're basically a "paper" (really plastic) guitar with a capacitive multi-touch surface that plays music in response to your touch. Here's a video demonstrating the thing in action: It actually seems like a pretty cool toy for anyone who wanted to create a more realistic air guitar... So, what's the problem? Well, it seems like most of the models Paper Jamz is offering look very much like Gibson trademarked guitar models, and the Paper Jamz folks (made by Wowwee) didn't bother to get a license. Wowwee doesn't even bother trying to hide it. In its marketing, it refers directly to the Gibson models each Paper Jamz design is set to look like. It's so blatant, it almost makes you wonder if Wowwee figured they'd get sued to help their marketing.

That said, even if it's totally blatant, I'm wondering if there's any actual "harm" here, despite Gibson's claims. It's not as if using one of these is going to make people say they don't want a real Gibson guitar. If anything, I could see these increasing the demand for the real versions of the various Paper Jamz models. Hell, I could see a market for Gibson to come out with similar designs just to capitalize on the popularity of the Paper Jamz guitars.

The flipside, of course, is that Gibson wants to "license" the trademarked designs, and is actually hoping to get Wowwee to pay up for the designs and then still get the benefit of increased demand for the real guitars. That feels a bit like double dipping, but you can understand where Gibson is coming from on that.

Where it gets a little shadier is going after the various retails selling the Paper Jamz offerings -- as the lawsuit is filed against Walmart, Amazon, Big Lots, K-Mart, Target, Toys R Us, Walgreens, Brookstone, Best Buy, eBay, Toywiz and HSN (Macy's was also threatened, but claims it doesn't sell the toy, so Gibson didn't sue). It gets especially questionable when it comes to eBay, where (obviously) some users have been selling the toy. Gibson claims that eBay is guilty of contributory infringement, because it did not respond to a cease & desist letter it sent and (Gibson claims) even under the recent Tiffany ruling, which absolved eBay of such liability, part of what worked in eBay's favor was its takedown policy. Gibson here is arguing that since eBay didn't take stuff down when it contacted them, that policy was ignored, and the Tiffany ruling no longer applies. That seems like a stretch, though there are some details lacking, such as exactly how Gibson informed eBay of the "infringing" material. A blanket cease & desist might not include enough information. Either way, it seems pretty silly to go after eBay here -- because the company has shown a willingness to fight (and win) over lawsuits like this.

Filed Under: contributory infringement, guitars, liability, paper jamz, trademark
Companies: ebay, gibson, wowwee

Disney, WB Claim Ad Firm Working With Pirate Sites Is Guilty Of Contributory Infringement

from the a-new-mole-to-wac dept

Apparently the folks in Hollywood are trying a slightly different tactic than directly wac'ing file sharing site/service moles, and are trying to go after other third parties. Disney and Warner Bros. have sued an ad firm called Triton Media for providing advertising services to a series of sites that the studios feel facilitate copyright infringement. Note the degrees of separation here. The sites in question do not host or transmit any copyrighted material. As the legal complaint notes:

Specifically, the Websites, have posted, organized, searched for, identified, collected and indexed links to infringing material that is available on third-party websites, otherwise provided access to infringing material, and/or hosted infringing material.

So, the websites themselves are already pretty far removed from the actual infringement. The files are hosted on other sites. They're shared by other people. These sites just allow users to post links. And... then on top of that the studios aren't even suing these sites, which are a few steps away from the actual infringement: they're suing this ad firm, which is another degree of separation away. Wow.

The complaint itself is pretty stunning too when you realize that it never actually shows what Triton did that would qualify as contributory infringement. It just focuses on these nine websites instead. Perhaps there's more to this lawsuit than is in the filing, but it seems like a huge reach. If advertising firms are liable for infringement that happens on a totally different website than the one they're working with because someone clicked a link... that seems like it could create massive liability for anyone offering services on any website.

Filed Under: advertising, contributory infringement, copyright
Companies: disney, triton media, warner bros.

Describing How To Create A Software Program Now Puts You At Risk Of Contributory Patent Infringement?

from the for-the-purpose-of-teaching... dept

A whole bunch of you have been submitting the following story from a Dutch developer who is being threatened by Landmark Digital, a BMI subsidiary which owns the patents on Shazam's music recognition technology, for writing a blog post describing how to build similar technology in your spare time. The story is a perfect example of the ridiculous situation with patents today. Basically, the guy noted that what Shazam does in recognizing music is really not that complicated, and explained how to create something similar yourself, which he did himself in a weekend. He had not released the code, but was planning to do so when the legal threats came in. The guy wondered what patents they were talking about specifically, especially considering that in Europe, the standards to patent software are much higher. In response, he was only told about two US patents (6,990,453 and 7,627,477 -- oddly, on that last one, Google still shows it as being patent pending, even though the patent was granted last year).

The developer points out how silly this is:

Why does Landmark Digital Services think they hold a patent for the concepts used in my code? Even if my code works pretty different from the Shazam code (from which the patents came).

What they describe in the patent is a system which:

1. Make a series of fingerprints of a media file and/or media sample (such as audio, but could also be text, video, multimedia, etc) 2. Have a database/hashtable of fingerprints as lookup 3. Compare the set of hashtable hits using their moment in time it happened This is very vague, basically the only innovative idea is matching the found fingerprints linearly in time. Because the first two steps describe how a hashtable works and creating a hash works. These concepts are not new nor innovative.

But, with a bit of imagination one could (possibly) argue that my code (again, written completely by myself in a weekend with some spare time) does the same thing as the patent describes.

After talking it over with some attorneys, he realized that it probably wasn't worth the potential lawsuit to publish the code he wrote over the weekend, as ridiculous as that sounds. But then things got more ridiculous, as the lawyers for Landmark demanded he take down the original blog post as well, saying that it could teach others how to infringe the patent:

As I'm sure you are aware, your blogpost may be viewed internationally. As a result, you may contribute to someone infringing our patents in any part of the world. While we trust your good intentions, yes, we would like you to refrain from releasing the code at all and to remove the blogpost explaining the algorithm.

Great, so now we have to worry about contributory patent infringement as well? Are we really going to keep stretching third party liability to such ridiculous levels? Explaining to people how they might possibly build a simple app is now putting yourself at risk of liability?

Filed Under: contributory infringement, europe, music recognition, netherlands, patents, software patents
Companies: bmi, landmark digital, shazam

Gucci Allowed To Sue Credit Card Processors For Contributory Infringement Over Counterfeit Goods

from the third-party-liability dept

We're always a little skeptical of third-party liability claims, because allowing those types of lawsuits can often create serious chilling effects on various services. It seems that any reasonable standard of liability would apply liability to the parties actually involved in breaking the law, rather than the service providers they use. Of course, supporters of third party liability point to cases where those third parties have to be aware of what's being done, how it breaks the law... and then do nothing to stop it. The question is usually where do you draw the line. Michael Scott points us a recent court decision where the judge is allowing Gucci to sue three companies involved in processing credit cards for a website (which it already shut down through lawsuit) that was selling counterfeit Gucci products. No one denies that the website sold counterfeit Gucci products, the question is whether or not these three companies are liable (and also if the jurisdiction is proper, but we'll skip that part of the lawsuit): Decision Gucci v Frontline (Credit Card) In this case, the court found there was little evidence to support direct trademark infringement, but enough to support contributory liability for all three parties (though, for different reasons for some of them). The middleman who set up the merchant account actually advertised on its website that it worked with "high risk merchants" including those who sold "replicas." The court finds that pretty compelling evidence of "inducement." Separately, the two financial institutions that acted as the actual merchant accounts both had programs in place where they either reviewed the websites they worked with careful and/or demanded detailed reports on the chargebacks they got. The court found in this case, that both institutions should have had enough knowledge that the site was selling counterfeit goods, and thus should have stopped doing business with them to avoid secondary or contributory liability.

I can see how the court decided the way it did with the middleman who advertised itself as working with merchants who sell "replicas" (though "high risk merchants" could be borderline -- since a brand new, but completely legitimate, merchant could be seen as "high risk.") Even so, however, it seems weird to put liability on someone who is effectively a matchmaker for business done later. As for the argument against the financial institutions, it gets much trickier. Gucci will probably win the lawsuit, given what the judge says, but it does get a little worrisome when courts start effectively demanding that third parties have detailed knowledge and understanding of their partners' business practices.

Eric Goldman notes numerous problems with the ruling, such as the fact that "the payment processor is charged with the knowledge of a third party entity's salesperson." That's always the problem with third party liability rulings. They're effectively claiming that a third party is somehow responsible for the actions of someone entirely different. Goldman's conclusions:

This is a terrible ruling on both a doctrinal and normative level. On a doctrinal level, the court bypassed the main holdings of Tiffany v. eBay (binding on the court), Perfect 10 v. ccBill and Perfect 10 v. Visa. Instead, the court stitched together crappy dicta from the Tiffany v. eBay case with Kozinski's dissent in Perfect 10 v. Visa to come up with an expansive secondary trademark liability rule applicable to vendors to counterfeit websites. I expect payment service providers to become the latest defendant-du-jour among trademark plaintiffs looking for deep pockets in web infringement cases. Something to look forward to.

Normatively, this ruling raises the specter that payment service providers will attempt to exercise even more business control over the businesses they service, effectively deputizing the payment service providers into cops on the Internet beat. As I mention in my notes about the OECD efforts on Internet intermediaries (which I will post soon), this deputization of private vendors into content cops has numerous disadvantages. I'm hoping this ruling gets fixed by the judge or on appeal so that we don't suffer the logical consequences of this bad ruling.

Separately, I do want to make one point that struck me in reading this ruling (along with the recent eBay/Tiffany ruling. Trademark law is in this weird vortex where it does not have an official safe harbor protection for third parties, a la copyright (DMCA 512) and defamation/other things (CDA Section 230). Both Section 230 and the DMCA provide rules (though, some would argue, not very clear ones) for how a third party can avoid liability. There is no such safe harbor for trademark law. And yet, the courts have effectively created a very similar safe harbor just by looking at the facts of the cases: if you don't have specific knowledge and agree to take stuff down when alerted to it (eBay ruling) then you avoid liability. That's just like the DMCA -- even if this particular case seems to stretch the understanding a bit.

This highlights the idea that the DMCA safe harbors aren't some ridiculous extension beyond common sense, as some copyright maximalists contend. Instead, it shows that the DMCA safe harbors do, in fact, match up with basic common sense in making sure that liability is applied directly to those who actually have the most knowledge of the situation... not just those with the biggest bank accounts.

Filed Under: contributory infringement, merchant accounts, trademark

Recording Industry May Go After OiNK Admin Again

from the not-getting-the-message dept

We were as surprised as anyone that a UK court correctly realized that OiNK itself didn't violate copyright law, and thus admin Alan Ellis hadn't done anything illegal. But rather than understand the difference between infringing copyrights and hosting a tracker, the recording industry is now flipping out and insisting that Ellis must be punished somehow, and it may file a civil suit against him because apparently punishing people is more important than actually coming up with business models that work.

Filed Under: contributory infringement, copyright, oink, uk

The Similarity Between ACTA And Chinese Internet Censorship

from the it's-all-about-secondary-liability dept

To be fair, it may have been Bono who first made the connection explicit, but others are beginning to notice that there are some worrisome parallels between what is being pushed via ACTA and other methods and ongoing internet censorship in China. The latest, as pointed out by the EFF, is writer Rebecca MacKinnon, who walks you through the way in which Chinese censorship is based on the same faulty principle as ACTA's push for secondary liability for ISPs.

Let's take a step back to explain this. We've discussed, in the past, that the way China operates its "Great Firewall" is not by explicitly banning anything. Instead, it simply puts liability on third parties such as ISPs and says they'll take the blame and face the consequences for any "bad stuff" that is allowed through to Chinese users. As MacKinnon notes, this is really "intermediary liability," or (obviously enough) putting the liability for actions on an intermediary to force them to try to curb the behavior of end users. In this way, the Chinese government can claim that it doesn't censor the internet and there's no such thing as a "Great Firewall," because it doesn't exist as a single thing. It's just that the government will punish ISPs who don't block "bad stuff."

But this "intermediary liability" is a big deal, because under any common sense approach to things, you should never blame an third party/intermediary for the actions of end users. And yet, that's exactly what the entertainment industry has been pushing. One of the key components being pushed for the internet section of ACTA is the idea of expanding "secondary liability" or "contributory copyright infringement" or whatever they want to call it. In reality, it's the same intermediary liability that China uses to have ISPs censor content. The idea is that if you put the liability for file sharing on ISPs, then they will be forced to figure out ways to stop it -- just like ISPs in China are forced to create their own censorship campaigns.

And, of course, this isn't even hypothetical. We've got some real world examples. That's because much of the early language in ACTA was modeled on the "free trade" agreement that the US pressured South Korea into signing. That included such intermediary liability for ISPs when it came to copyright infringement, and guess what happened? First, the country felt it needed to start kicking people off the internet based on a "three strikes" plan, just to satisfy the treaty. Then service providers quickly started banning all sorts of activities, including any music uploads and many video uploads. After all, it's not worth it for the service providers to be liable, so they block the ability to upload all sorts of content. And, of course, with such liability there, others went even further, with some service providers even banning advertisements for any kind of website that could allow copyright infringement, because of the fear that, via such intermediary liability, they may get blamed just for allowing an advertisement that pointed to a site that could be used for copyright infringement.

When you look at the details, it's incredibly similar to the way in which China crafted its Great Firewall. Impose such secondary liability that puts the responsibility on a third party, and and watch those third parties basically lock down all sorts of additional things, just to be safe. Of course, the old school entertainment industry doesn't mind, because preventing you from communicating isn't their problem. They don't see the internet as a communications platform anyway. They're hoping it's the next broadcast medium, and clearing the decks via a Great Firewall an intermediary liability system works right into those plans. The more you look at the details, the more it looks like the entertainment industry is doing everything possible to encircle the internet to make it appear more like a broadcast entertainment medium, rather than a communications medium.

Filed Under: acta, broadcast, censorship, china, communications, contributory infringement, copyright, entertainment, intermediary liability, liability, third party liability

OiNK Admin Explains Why He Thought The System Was Legal

from the contributory-infringement dept

TorrentFreak is covering the ongoing trial of Alan Ellis, the admin of the popular (and now shut down) private torrent tracker OiNK. Back when it shut down, Trent Reznor outed himself as a regular user of OiNK, pointing out that it really filled a niche that the industry itself was not providing. As he noted:

"I'll admit I had an account there and frequented it quite often. At the end of the day, what made OiNK a great place was that it was like the world's greatest record store. Pretty much anything you could ever imagine, it was there, and it was there in the format you wanted. If OiNK cost anything, I would certainly have paid, but there isn't the equivalent of that in the retail space right now. iTunes kind of feels like Sam Goody to me. I don't feel cool when I go there. I'm tired of seeing John Mayer's face pop up. I feel like I'm being hustled when I visit there, and I don't think their product is that great. DRM, low bit rate, etc. Amazon has potential, but none of them get around the issue of pre-release leaks. And that's what's such a difficult puzzle at the moment. If your favorite band in the world has a leaked record out, do you listen to it or do you not listen to it? People on those boards, they're grateful for the person that uploaded it -- they're the hero. They're not stealing it because they're going to make money off of it; they're stealing it because they love the band. I'm not saying that I think OiNK is morally correct, but I do know that it existed because it filled a void of what people want."

The problem, however, as more people looked at the issue was that it wasn't clear what laws were actually broken. The UK apparently does not have a concept like contributory copyright infringement (and, yes, one of the things ACTA is trying to require is that all signees add that to their copyright laws), and since he operated just the tracker, Ellis didn't copy any works on his own computer. He wasn't storing anything and he didn't transfer anything. So what did it do? After working through a variety of theories they came up with conspiracy to defraud the music industry, which sounds quite similar to felony interference of a business model.

Now that the trial is ongoing, Ellis is explaining that he didn't believe that what he did in running OiNK directly was copyright infringement, even if users of OiNK may have infringed on copyright (he does admit to downloading works via OiNK, however -- but that's separate from his admin role, and he claims that he only used it to sample new musicians, and bought the albums of those he liked). Without a contributory copyright infringement rule, it is difficult to see how hosting the tracker alone could infringe -- and if that's the case, it's not clear why the site was shut down. Hopefully the court recognizes this. However, we're still trying to understand how this "conspiracy to defraud" concept works. As Reznor pointed out above, there was little effort to "defraud" anyone. It was very much about sharing and promoting artists to help them in the OiNK community. But, of course, the industry will never admit to the promotional value of sharing.

Filed Under: contributory infringement, copyright, oink, uk

Google And Microsoft Sued For Linking, Indirectly, To Infringing Music

from the good-luck dept

Well, people have asked in the past how Google and Microsoft's search engines are really all that different from some of the file sharing search engines, and now we've finally got a lawsuit to at least explore some of that. It's not a major label, but a small indie blues label called Blues Destiny is suing Google and Microsoft along with RapidShare. At issue, of course, is that people are uploading Blues Destiny music to RapidShare, and searches via Google and Microsoft can find them. As Eric Goldman notes in the writeup linked above, the label isn't particularly clear in what it's upset about, so he believes the real issue isn't even that Google and Microsoft link people to RapidShare, but that it finds other sites that then link to RapidShare. That seems like many degrees removed from actually infringing -- and it's difficult to even see a clear claim for "inducing" infringement. Goldman also notes that the lawsuit is complicated by Blues Destiny's imprecision and vagueness in a series of (increasingly exasperated) takedown notices, which is coupled with Google not complying -- but potentially that is due to the failure of Blue Destiny to properly state what needed to be taken down. Either way, it's difficult to see how either Google or Microsoft is going to be found liable here, but the lawsuit is still worth watching, given the questions about where the fine line is drawn between just being a search engine and being a contributory infringer.

Filed Under: contributory infringement, copyright, inducement, linking, search engines
Companies: blues destiny, google, microsoft, rapidshare