Lawyers Going After Charles Carreon Increase Their Request To $40,000 In Attorneys' Fees Owed

from the get-some-popcorn dept

Last week, we noted that the case of a parodist blogger against Charles Carreon concerning Carreon's threats to wait the blogger out and sue at a later date was mostly over, after Carreon effectively threw in the towel, and admitted that his legal threats were completely empty and he wouldn't pursue the blogger. However, we noted there was still the issue of attorneys' fees. Carreon argued that his settlement offer included an offer of $750 to cover the filing of the lawsuit, and that by accepting it, any other fees were then out of discussion. The public interest lawyers representing the blogger, Paul Levy and Cathy Gellis, pointed out that's not how this works, and noted that they were owed closer to $5,000. And, now, they're ratcheting that up. In a new filing, highlighted by Adam Steinbaugh, they're explaining why Carreon should be on the hook for $40,115, mostly due to Carreon's own actions.

Moreover, although the "groundless or unreasonable" test is an objective one, defendant's conduct shows that he was fully aware that he had no basis for claiming trademark infringement. He refused to waive service of summons because, he said, he did not want to have to defend the litigation, and indeed he thumbed his nose at the efforts to serve him, saying that he was deliberately not going to "expose [him]self to service." Once service was effected, he refused to pay the expenses of service, supposedly because he was going to file a motion to dismiss the complaint, forcing plaintiff file a motion seeking an award of a few hundred dollars in expenses; plaintiff also sought an award of attorney fees for having had to file this motion. And then, when defendant saw that his escape routes had been cut off— that he had been served, and that plaintiff was not going to let him out of the case—he simply dropped his trademark claims unconditionally and offered judgment. Mr. Carreon's course of conduct speaks volumes about his evident recognition of the fact that his claims were meritless; he provides no reason for believing that his decision to drop them was occasioned by anything that he had learned about the merits during the course of the litigation.

Finally, although the groundlessness of the infringement and cybersquatting claims is alone sufficient to support an award of attorney fees under Ninth Circuit precedent, in circuits with a higher standard for finding cases exceptional, a litigant's oppressive conduct is one of the factors considered in support of fee awards. ... Although plaintiff's counsel tried to steer Mr. Carreon away from his threats of litigation, Mr. Carreon responded by ramping up his threats, trying to put the blogger in fear of significant financial liability by, for example, warning that he would seek statutory damages of $100,000... and would employ counsel instead of proceeding pro se for the precise purpose of running up the blogger's liability for attorney fees... he also boasted of his reputation for "litigating appeals for years." ... Once the litigation was filed, and while he was refusing to submit to service, he sent a letter to Mr. Recouvreur's employer,... which might have caused trouble at work for Mr. Recouvreur, by threatening to hold the employer liable for the conduct of its employee, and in any event to impose invasive document preservation requirements.

And after Mr. Carreon was finally served, he tried to threaten his way out of being held responsible for his baseless threats by making an additional threat to sue the employer of plaintiff's lead counsel, unless counsel induced his client to settle on the terms that Mr. Carreon demanded.... Mr. Carreon's decision to offer judgment giving plaintiff his complete success on the merits is perhaps an item in Mr. Carreon's favor in judging his litigation conduct, but in its entirety Mr. Carreon's litigation conduct was sufficient oppressive to form yet another factor in support of a finding that his case was exceptional.

Steinbaugh also notes a few interesting points. There's an indication that the plaintiff may also go after Register.com for exposing the parodist's name. Furthermore, Steinbaugh points out how ridiculous it is that Carreon complains in his last filing about people online wishing him ill-fate, and saying that he will "never inveigh against anyone in the public forum by deriding their character as others have mine." That, of course, is funny, given that his wife, who once claimed that I was a "nazi scumbag" seeking to do "to Charles what they did to Jewish lawyers in Nazi Germany." Uh huh. And it's not like Tara and Charles have calmed down in this department lately. Steinbaugh points out that Tara Carreon is now arguing that Matt Inman is partly responsible for the Newtown massacre. And then there's Carreon's Rapeutation.com site. The idea that Carreon somehow doesn't deride others' character in public isn't supported by the facts.

Separately, Paul Levy has blogged about the latest, providing more context, in which he also notes that Carreon's claims to the court that he never intended to take the blogger to court may actually make things much worse for Carreon, in that it may have opened him up to legal consequences from other venues, including Walgreens, the blogger's former employer, which Carreon threatened to drag into the lawsuit (which he now claims he never intended to file):

In trying to persuade me not to pursue the claim for attorney fees on the merits, Carreon claimed that the suit for a declaratory judgment was altogether unnecessary because, he claimed, he never would have sued for a trademark violation; if we had only waited, he said, we would have seen that.

If, in fact, Carreon never intended to pursue his threats to sue the blogger, that is perhaps the worst of all, not only because it means that Carreon has probably cost himself a great deal of reputational and financial harm for having a big mouth, but also because it puts him at significant risk of other legal consequences. For example, in addition to threatening to sue Register.com, Carreon threatened to sue Walgreens, the blogger's employer when the case began, demanding an extensive preservation of electronic records. We could not help thinking at the time that his real purpose was to try to drive a wedge between the blogger and his source of employment. If Carreon never intended to file such a claim, the blogger may have a claim for intentional intereference with contract, and perhaps Walgreens has a claim of its own for the expenses incurred in complying with potential data preservation obligations relating to an intentionally empty threat.

Oh, also, there may be ethics issues given how Carreon obtained the blogger's name, claiming it was for legal purposes, even though he now claims he never intended to file a lawsuit:

Moreover, if Carreon's current statement about his intentions last summer is true, there may be ethics consequences. After all, without having to file suit, he managed to intimidate the blogger's domain name registrar into placing the blogger's name into the public WHOIS record where other members of the public were able to see it; Carreon himself took advantage of the disclosure to feature the blogger's name publicly on his "rapeutationist" blog. And yet, Carreon now claims, he never intended to file the lawsuit at all.

The Federal Rules of Civil Procedure, Rule 26(b)(5) and the California Code of Civil Procedure, section 2031.285, both require a party who receives information that has been the subject of a claim of privilege to sequester the information pending a final ruling on the privilege. This rule has been applied to information obtained about the identity of an anonymous Internet speaker, and both an ABA Formal Opinion, and ethics rulings in some states, have taken the position that a violation of the obligation to sequester can constitute an ethical issue. Consequently, Carreon's insistence that he was never actually going to institute legal proceedings to vindicate his claim of trademark infringement outs him at risk of renewed disciplinary proceedings by the California and Oregon bar authorities.

Finally, on the point of whether or not further action will be taken against Register.com, as mentioned above, Levy notes that he's been trying to talk to Register.com about their policies, and that's going to determine the next steps:

Carreon's contention that he would never have followed through on his threats if legal action also reflects poorly on Register.com's craven release of the blogger's identity, albeit temporarily. While the case against Carreon was pending, we put Register.com on notice of a possible claim, perhaps a class action claim, for advertising (and charging extra for) a private registration service without providing any real safeguards against spurious claims demanding disclosure of the registrant's identity. We have tried to discuss with that company's counsel how they will handle cases like this differently going forward, and have postponed legal action to see whether such talks could be fruitful. But, to date, it has never been convenient for Register.com's representative to actually discuss its policies and procedures.

Now that the merits of the Carreon case have been concluded, we will have to see whether it is possible to avoid litigation on that aspect of the problem.

The case may be ending, but there are still plenty of loose ends.

Filed Under: attorneys fees, cathy gellis, charles carreon, ethics, paul levy

Is It Ethical For The American Bar Association To Claim Copyright On Its Ethics Opinions?

from the encouraging-unethical-lawyers dept

It sometimes amazes me how some copyright holders exert copyright when it makes absolutely no sense at all. There are plenty of times when -- even if something is covered by copyright -- it would be silly to use it. And, yet, sometimes, it still happens. Take, for example, this story sent over by Aaron DeOliveira. A lawyer, Ernie Svenson, posted a PDF file containing an American Bar Association "ethics opinion" on his blog... and the ABA threatened him with a copyright infringement claim. Remember, this is an ethics opinion from the ABA -- basically telling lawyers how they should act. You would think that they would want such things spread as far and wide as possible. I mean, that's what you would think if you were sensible. But... this is the ABA, and they just think "copyright infringement." Svenson is bewildered by the situation, noting that he would have thought the ABA would also want more lawyers aware of its ethical opinions.

Another lawyer, Carolyn Elefant, who has apparently complained about this stance by the ABA for a while, has set up an online petition asking the ABA to stop copyrighting its ethics opinions, and has also written a fantastic blog post about why it's so stupid for the ABA to do this. She notes that even if you think the RIAA's copyright tactics are ridiculous, at least it can legitimately claim that it thinks it's protecting its constituents. But, you can't make that argument here:

... whether you agree with the RIAA's tactics or not, at least its copyright enforcement activity is intended to protect RIAA's constituents; artists, musicians and record companies who lose money when their music is misappropriated. By contrast, the ABA’s policy of copyrighting ethics opinions -- the source of authority that govern lawyers’ conduct and inform many state bodies regulating lawyers — and locking them behind a paywall hurts lawyers and the public.

She goes on to point out that while she's argued that locking up ethics opinions harms lawyers, she's now realizing that it also harms the public -- for no good reason.

But now I realize that the problem caused by the ABA’s policy goes way beyond lawyers and affects the public.  Members of the public may not realize that lawyers can’t just outsource work to non-firm members without supervision (Ethics Opinion 08-451) or are limited in their ability to change fees in the course of representation  ABA Formal Opinion 11-458 (still online free!). Deprived of access to ethics opinions, clients may tolerate lawyers’ unethical conduct, ultimately prejudicing their case.

I really wonder what the ABA's defense for copyrighting ethics policies are, and why it would go after lawyers who share them. This really feels like a "because we can" situation, no matter how ridiculously counterproductive it is. Unfortunately, when it comes to intellectual property, there are way too many lawyers who seem to think "we can" automatically means "we should."

I wonder if someone could get the ABA to issue an "ethics opinion" on locking up crucial information on lawyer ethics from other lawyers and the public. It seems to me that it would be quite easy to make the argument that it's incredibly unethical.

Filed Under: copyright, ethics, ethics opinions
Companies: aba

DailyDirt: Journalism FAIL

from the urls-we-dig-up dept

While journalists are expected to follow a certain set of standards or code of ethics, that's not always the case. Every now and again, someone breaks the rules and gets away with it -- if only temporarily, since they usually get caught in the end. One famous example is former U.S. journalist Stephen Glass, who had fabricated many articles while he was working for the magazine The New Republic in the 1990s. (Apparently, he's now fighting for the right to practice law in California, after he was denied a license in 2007 on moral grounds.) Here are a few more examples of bad journalism.

• Jonah Lehrer, who had blogged for Wired for several years and was recently hired (and then fired) by The New Yorker, reportedly fabricated quotes and recycled or outright plagiarized parts of articles. While Wired had initially agreed to keep Lehrer on as a features writer, after carefully examining a number of his posts, the magazine just recently decided to end its relationship with him due to his failure to "meet WIRED editorial standards" or to "follow basic good journalism practices." [url]
• Ryan Holiday, marketing director at American Apparel, calls himself a "media manipulator." He wrote a book called "Trust Me, I'm Lying" on how to exploit the media by lying. Even worse, he used Help a Reporter Out (HARO) and pretended to be an expert on pretty much everything -- by lying, of course -- and managed to fool reporters from MSNBC, ABC News, CBS, The New York Times, and more. He claims it was all part of an experiment. [url]
• Margaret Wente has been accused of plagiarism -- copying the words of another Canadian columnist for her own article in 2009 about genetically modified foods in Africa. She has responded to the allegations, but her employers have also disciplined her (without revealing the details of her punishment and obviously not firing her). [url]
• Poynter.org has a wrap-up of the year's journalistic failings (so far) -- which it calls Journalism's Summer of Sin -- and it prescribes some measures for news organizations to prevent (and deal with) plagiarism and fabrication. The year isn't over, though, so place your bets on how many more journalistic fumbles will occur before 2013. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post.

Filed Under: ethics, haro, jonah lehrer, journalism, labvertisements, lying, margaret wente, plagiarism, ryan holiday, stephen glass

Oxford Professor Says Mankind Is Ethically Obligated To Create Genetically Engineered Babies

from the pick-and-choose dept

As we were just talking about the appeals court ruling that isolated genes are still patentable, we will have to begin thinking about how such a ruling will impact our lives. Some groups have decided to go the property rights route to assign ownership of DNA. Others wring their hands over how this will impact medicine. But, now that testing for genetic markers in embryos is in vogue, we can finally ask "what about the children?"

The Telegraph put that question to Professor Julian Savulescu, expert in practical ethics at Oxford, and he states, unequivocally, that not only should the genetic testing of embryos for physical illnesses be allowed, but applying those same tests for behavioral genetic markers is mankind's ethical obligation. It should be noted that, currently, outside of a few accepted tests these screenings are illegal, but Savulescu thinks that needs to change.

"Surely trying to ensure that your children have the best, or a good enough, opportunity for a great life is responsible parenting?" wrote Prof Savulescu, the Uehiro Professor in practical ethics. "So where genetic selection aims to bring out a trait that clearly benefits an individual and society, we should allow parents the choice."

There is a word for this kind of mass-screening, one which you won't hear Savulescu utter, and it is called eugenics. The reason many advocates of this kind of screening won't use that word is because it long ago became associated with Nazi philosophy, even though (as you can read in the Wiki article) many other nations did and still do some flavor of eugenics. The United States, for example, has some jurisdictions where testing for diseases (mostly STDs) that could be passed along to children is a requirement prior to attaining a marriage license. Israel has a program called Dor Yeshorim that tests for a multitude of hereditary diseases like Tay-Sachs and Cystic fibrosis. In China, eugenics has taken a more prominent role, with the PRC's Marriage Law requiring a doctor's approval prior to marriage (harsher language against specific illnesses found in previous iterations of the law have been removed over the years).

But what is different about Savulescu's argument is that we are no longer talking about genetic illnesses in the traditional sense, but instead behavioral genetic markers.

"Indeed, when it comes to screening out personality flaws, such as potential alcoholism, psychopathy and disposition to violence, you could argue that people have a moral obligation to select ethically better children. They are, after all, less likely to harm themselves and others."

This seems to me to be a gross-oversimplification of the role genetics plays in behavior. While we can all spend the next few weeks in a long-form discussion of whether nature or nurture plays the predominant role in behavioral outcomes of children, I think few would disagree that both are aspects that do in fact play some role. And, while Savulescu seems to make his argument matter-of-factly, other bioethicists disagree. Predictably, many of these criticisms focus on Nazi eugenics to extrapolate the entire field, but not all of them.

Biologists, for instance, point to what occurs in small, isolated populations (i.e. the Dodo bird) when a lack of genetic diversity leads directly to a species extinction. They then point out that the combination of allowing for "designer babies" based on widely accepted culturally preferred traits and the perhaps inevitable monoculture that would result would breed a scenario in which mankind was ripe for massive exposure to a single disease.

Add to all of this the potential for inherent socio-economic lines to be drawn in the sand in terms of health, between those that can afford the testing for what are now patentable isolated genes and those that cannot, and you can see where potential abuse and negative consequences loom around every corner.

That said, I refuse to take a luddite approach to genetic testing in general, or even eugenics as a whole. I admit that I write this entire piece without fully understanding where I stand on the issue, aside from what I think is the rather common sense position of advocating caution. Instead, I open the topic to you, the reader, for the comments section.

Filed Under: babies, ethics, gattaca, genetic engineering, traits

Emory University's Dishonest Data Reminds Us That Ethics Don't Come From A 'Policy'

from the ethics-policy dept

I know that for many universities, where they end up in the various "rankings" lists can make a big difference in terms of the type of students they attract, the money they can bring in and the professors they can get. So it's almost surprising to me to find out that Emory University's admission that it effectively fudged the numbers it sent to US News & World Report (the pre-eminent listmaker of university rankings) was really the first of its kind. The article does note a few other questionable uses of data by some universities -- such as Baylor paying already admitted students to retake the SATs, hoping they'll score higher and boost the rankings -- but Emory went a bit further. It didn't quite make up the numbers, but chose to send in the data for all the students they admitted, rather than the students who enrolled. And, of course, many students with higher GPAs and SAT scores may have been admitted to Emory, but chose to go elsewhere.

Of course, what struck me as extra interesting about this, is that we always hear about universities disciplining students based on an "ethics" code or something like that. So I figured Emory probably had something like that as well... and it did. There's the Emory University Undergraduate Code of Conduct, which includes lines like:

Emory University expects that all students act honorably, demonstrating a keen sense of ethical conduct. The University expects that its students behave respectfully, providing particular consideration for other people and for property. As members of a community, Emory University expects that students act responsibly, being accountable for the safety and wellbeing of themselves and others. University students are expected to be trustworthy, demonstrating honest character upon which others may rely with confidence.

That same policy also forbids "intentional misrepresentation," including "providing false or misleading information to a University official" or "filing a false or misleading report."

I also found that the school has a Code of Business Ethics and Conduct for employees, which includes this tidbit:

Emory University has adopted an overarching Statement of Guiding Ethical Principles that applies to Emory employees and all other members of the Emory Community. Emory employees should strive to adhere to these principles in carrying out their job responsibilities, and in particular any responsibilities they have in connection with Federal Research/Contract Activities.

That pointed me to the Statement of Guiding Ethical Principles (pdf) which, among many other things has lines like the following:

Members of Emory are expected to strive for the highest degree of integrity.

All of this has me wondering about these kinds of "ethics" policies and "honor codes" and the like. So many universities have them, but I'm curious if they actually do any good at all. Most of them say things that are basically common sense, and I have trouble believing anyone actually considers "oh, but the ethics policy!" before violating them. So what is the purpose of such policies? It seems that ethics aren't the kind of thing that you write down in a policy, but that you demonstrate by how you act and what you do.

Filed Under: data, ethics, falsifying, rankings, universities
Companies: emory university

Copyright Troll Claims Sanctions Against Him Are 'Bulls**t' And He's Going To Keep Sending Questionable Subpoenas

from the good-luck-with-that dept

After losing again for significant ethical lapses in sending subpoenas to identify individuals he was trying to shake down for payments -- at the same time the court had ordered him to wait for a fair hearing on whether those individuals could protect their anonymity -- Evan Stone apparently still does not realize the seriousness of what he did. In an interview with Ars Technica, he appeared both dismissive and defiant of the ruling against him, for which he owes tens of thousands of dollars:

“They just punted, and said you waived your arguments, so we have to affirm,” he told Ars Friday morning. “I'm ready for someone to take this up, this issue of copyright subpoenas in the Fifth Circuit. That's really the bigger issue. I'm just going to move on from this whole sanction thing. I think it's bullshit and I think it shouldn't have happened. I’d rather move on with my life than be right. That's what I’m going to do. We're going to do some more copyright subpoenas, and we're going to bring them before the district and see if they are accepted or denied and then bring them before the Fifth Circuit.”

This is an interesting revisionist history. First off, that's not quite what the court said. It did note that, through Stone's own incompetence as a lawyer, he waived any significant arguments against the sanctions, but that did not minimize the court's serious concerns about Stone blatantly defying its clearly-stated requirement of first holding a hearing to see if the anonymity of the users could or should be protected. Remember, the appeals court didn't just "punt," it also stated:

We conclude, however, that no miscarriage of justice will result from the sanctions imposed as a result of Stone’s flagrant violation of the Federal Rules of Civil Procedure and the district court’s orders. Stone committed those violations as an attempt to repeat his strategy of suing anonymous internet users for allegedly downloading pornography illegally, using the powers of the court to find their identity, then shaming or intimidating them into settling for thousands of dollars--a tactic that he has employed all across the state and that has been replicated by others across the country.

To pretend this is merely punting because of Stone's own failings as a lawyer underplays both how he screwed up in handling his own appeal, as well as the court's concerns with Stone's ethical lapses that resulted in the sanctions in the first place.

That he's going back to sending out subpoenas and pretending that what just happened to him is no big deal is somewhat stunning. Of course, what's even more stunning is that anyone would hire Stone to do more copyright trolling. Whatever you think of the practice, Stone has clearly demonstrated -- and been told by a court -- that he's not doing it right. Why would anyone hire that guy to do the same thing again?

Stone also apparently tried to pin the blame on Verizon for the mess that he's in. Again, in his discussion with Cyrus Farivar at Ars:

But beyond his questionable legal tactics, Stone lamented the fact that larger ISPs, like Verizon, (against whom he filed a subpoena in late May 2012 over a pirated work of anime in an ongoing case) fight him “tooth and nail,” while smaller ISPs simply “cough up the user information.”

And, he argues, Verizon isn’t protecting their users out of principle or out of an interest in legal fairness, but rather to protect their highest-paying customers, which, according to Stone, are pirates.

That's a pretty obnoxious statement and there's not much support for it in real life. Verizon protecting its users' privacy against lawyers trying to identify them for a trolling operation isn't about protecting revenue, it's about protecting individuals' basic rights against bogus legal threats and people who abuse the court system as a business model.

Filed Under: copyright troll, ethics, evan stone, sanctions
Companies: verizon

Free Culture Is The Response To The Ethical Failings Of The Old Entertainment Industry

from the if-we're-going-to-talk-ethics... dept

I already posted the responses of a bunch of musicians and music industry folks to the whole David Lowery/Emily White kerfuffle, but there were two more responses that were so good and so thorough I wanted to cover them separately. The first is from Zac Shaw, a musician and indie label owner who argues that if there's any ethical argument at all, it's the one in favor of free culture.

Asking today’s music consumers to kindly start paying for recorded music again because it’s the ethical thing to do isn’t only unviable — it’s not the ethical thing to do anymore. Free Culture is an ethic, and I think I can speak for my generation when I say we believe it to be the high ground over the way the music industry used to be run.

Shaw talks about his own experiences as a musician, getting signed to a label, having a deal that was impossible to recoup, and then the realization that while they had a fanbase, it just wasn't big enough to keep the band going. Unlike Lowery, Shaw isn't upset about this. He notes that this is the reality of the market. But he looks around at what's available today and he sees all sorts of opportunity. As he notes the people who are complaining loudest all seem to be the folks who were some of the very, very, very few musicians who succeeded under the old system. They tend to ignore all those who failed, because they liked it when they had gatekeepers keeping out the competition and keeping prices artificially high. But that was all based on lies and questionable behavior by record labels to keep out most musicians:

I’m going to level with you. You and many other Free Culture detractors are people from social circles with musicians that did well in the past but whose revenue dropped dramatically along with industry profits. I think the driver behind this blithely unrealistic “let’s go back to the way things were in the 90s” movement is pretty straightforward — you tasted profits from a business model that is no longer sustainable. You want your industry back.

We don’t.

Consider for a moment how were the profits of the “old” music industry won: By subjecting listeners and musicians — and indeed, our very culture — to a laundry list of horrendous commercial exploitation. Price fixing, payola, unpaid royalties, market monopolies, ticket surcharges, obscenely exploitative record contracts, manufactured popularity, censorship, perpetual copyright and destruction of fair use and the public domain… the list goes on and on. In short, the old way of doing things sucked and we don’t care if a few of that era’s successful artists no longer get mailbox money for music they recorded decades ago. We certainly don’t care if the record industry, which enabled these injustices, dies a slow, public death.

Shaw points out that, if anything, this new generation actually has much greater respect for musicians. What they don't have time for are those labels that did all of those things to keep music away from the public and to keep musicians from getting paid in the past:

Today’s musicians are held in higher esteem by listeners than ever before, and it’s the industry that has lost their respect (and money), due to a history of unethical behavior.

And, in fact, the new tools of today are changing the balance of power, and enabling the artists who couldn't even get in the door before to now reach out directly to fans and to build support without having to hand everything over to the gatekeeper:

Free Culture opponents often suggest technology somehow caused our generation’s desire for compensating musicians to evaporate. But it was clearly the corruption and ineptitude of the industry itself that is to blame for this negative attitude toward paying for music. Digital music technology provided the opportunity musicians and listeners have been waiting decades for — to balance the industry’s unchecked power, and maybe eke out a more sustainable living in the process.

Fans formerly had no apparatus to directly compensate artists. Now that they have tools like Kickstarter and Bandcamp, we’re seeing millions of dollars pouring directly into musician’s pockets.

As Shaw points out, Lowery and his friends want the next generation to "fix" the industry -- but the only way they can think to do so is to try to go back in time and re-establish that old system. But they miss the fact that this generation is actually fixing the industry by providing the wonderful new tools and services to help musicians: helping them create, promote, distribute, connect and monetize. It's just that it's "different" than the old way:

That’s the thing about asking our generation to fix the record industry. We’re already doing it. We’re connecting artists directly to fans and bringing back patronage, a far less exploitative model that is emerging as the foundation of the new music career. We’re using crowdfunding to finance our work. We’re using digital tools to democratize distribution and licensing, with fairer publishing deals. Instead of basing our entire career on one album dropping or flopping huge, we’re ditching the LP in favor of a steady stream of singles, what fans really want. Apps are the new album. Production is going more lo-fi but is becoming more diverse and original in the process. These are the viable solutions I was talking about earlier. It’s all actually quite liberating because none of it involves being exploited by the music industry, and if it does, it’s certainly far less than in the past.

And yes, we’re selling T-shirts. I wouldn’t have to sell ‘em if I had a dollar for every time I heard, “your music is free, so what, you’re going to make a living selling T-shirts?” But the profit margin is good and they’re moving off the merch table like CDs used to. You have to realize that when the physical media that holds the music is no longer a profitable product, there are myriad replacements which tie the music to a physical product that can be profitably sold. The critical thing to realize here: the devaluation of the music recording increases the value of merch for the artist. Our fans are gonna spend $10 at our merch table anyway — should we sell them a T-shirt they will wear everywhere for a 150% markup, or should we sell them a CD they’ll burn and shelve for the statutory rate of 9.1 cents per song?

There's a lot more in Shaw's piece, and all of it is worth reading. Of all the responses to Lowery, Shaw's seems like the most comprehensive one I've seen and makes the point eloquently -- and shows how Lowery's distorted view of the world misses the bigger picture. Lowery is defending the 1%. The small group of musicians who were allowed through the gatekeeper system in the past, against what's actually best for the vast majority of musicians and fans. The new technologies and services that Lowery and his friends blame are actually enabling a great new world for all sorts of musicians who would have had no place in the world beforehand. Lowery's friends can insult those artists, and insinuate that a failure to go through the old system shows they're "untalented," but any real attempt to look around at the content being produced today would show you that's crazy. There's so much wonderful content being produced -- and much of it by artists who are embracing all of the amazing things that the internet allows.

The second post is by Dave Allen -- whom we've written about before. Allen, of course, was a member of one of the seminal post-punk bands, Gang of Four, and has been very involved in both the music and tech worlds for years. He's always fun to talk to, because he always makes me see the world differently than I did at the start of the conversation. So I knew I'd be interested in his take on the whole kerfuffle, and he does not disappoint. At all. Go read the whole thing, entitled: The Internet could care less about your mediocre band. In it, he makes a ton of good points, but it all comes back to two things: (1) the old system was horrible and corrupt and most artists never made much money at all and (2) the new system has tons and tons of opportunity, but not if you aren't very good or if you sit around complaining about people not buying music, rather than figuring out how to embrace all the amazing new opportunities. I know this post is already really long, but here are just a few snippets of Allen's writeup (though, again, read the whole damn thing):

I take issue with it in its entirety because Lowery is attempting to solve the wrong problem. He is attempting in the present to solve a problem of the past – lack of music sales; ergo, damage to musicians income levels or lack thereof since the advent of the Internet. (Oddly he doesn’t mention that the music industry is most likely the only industry to ever, ever, sue its own customers. An inconvenient truth.) He even lays out in fine detail how much Emily would owe if she’d paid for all of her music (most of which came from the labels as “promos”. Once again Lowery doesn’t mention how music writers and radio DJ’s sold those promos to record stores..just saying.) He then asks her to cough up the dough for starving musicians.

He also rather insensitively points out, while undermining his argument, that “the average income of a musician that files taxes is something like 35k a year w/o benefits.” That’s almost $10k more than the current US median wage. There are around 8 million unemployed people here in the USA, many without a place to call home, who would gladly take that income. I find him so condescending that I want to break something right now.

I also find it disgusting that Lowery conjoins the deaths by suicide of Vic Chesnutt and Mark Linkous to this topic. He knows very well that those two brave artists, much braver than he, suffered through circumstances that were extremely personal and difficult to control. Had they been musicians or not, had nothing to do with the incredibly unfortunate outcome of their lives. It only goes to show how shallow and specious his entire argument is if he has to pivot it on their deaths.

He goes on to point out the flawed premise with not just Lowery's rant, but the very basis of Lowery's blog:

In what may, or may not, have been a misstep, Lowery posted his rant to The Trichordist blog whose tag line, Artists For An Ethical Internet, says it all. In using that tag line they show in brilliant light how much they misunderstand what the Internet is. And by doing so they undermine the very validity of their presence on the Internet. They can yell at the Internet into infinity and it will never blink.

The Internet can not be ethical. Only users of the Internet can be said to be ethical, moral, or philosophical; they may be terrorists, kidnappers, racists, deviants; they could also be atheists, religious zealots or spiritualists; they might be gay, straight, bi, married, divorced; employed, destitute…the list goes on. Whoever they may be they are users. The Internet is its own thing. The Internet doesn’t give a damn about musicians or your mediocre band.

And finally there’s this – Lowery writes about “immoral and unethical business models.” And includes this – “..they are “legitimate” companies like Google.” What’s with the quotes around “legitimate” does Lowery think Google is not legitimate? No, he thinks Google is the problem (read Devil..) because Google in his mind owns the “Unethical Internet” because of its advertising prowess. And I quote – “Google is also selling ads in this neighborhood and sharing the revenue with everyone except the people who make the stuff being looted.” Looted! Unbelievable.

He then rambles on about the “cost” of free music downloading – the $1000 laptop, the costly iPhone or Tablet, as if people only use these products to download music! He also falls into the same trap that U2′s manager, the ISP bully Paul McGuinness, falls into – blame the ISP’s for allowing access to the Internet, where as we know, people only go to steal music.. McGuinness is so well informed about the Internet that in the Billboard article I linked to he talks about the Googles! And he also said this about Apple and Google – “They didn’t invent the MP3, they just made the best one.” Erm.., what?

Clearly this a fool’s errand. At least we know who the fools are. They are what the economist Paul Krugman calls “Very Serious People,” for only they know how to fix things.

While my response to Lowery's original post was that there wasn't anything new about it, since the same arguments have been debunked repeatedly in the past, the acceptance by many that Lowery actually knew what he was talking about has made it worthwhile to respond. Lowery's piece has inspired lots of interesting commentary on the difference between looking backwards and moving towards future opportunity -- and that is worth discussing. And I'm glad people like Dave Allen and Zac Shaw decided to do so.

Filed Under: dave allen, david lowery, emily white, ethics, gang of four, zac shaw

Some Facts & Insights Into The Whole Discussion Of 'Ethics' And Music Business Models

from the well-needed dept

I know we've written a few times now about David Lowery's now infamous shaming of an intern because she apparently doesn't give him enough of her money, but that story keeps getting attention. Thankfully, a lot of that attention comes in the form of people from all over the music business popping up to explain (1) how Lowery's factual claims are false , (2) his ethical claims are silly and (3) it's time to get with the future, rather than pine for a mythical past that never existed. Here's a collection of some of the more interesting such posts.

First up, we have Jeff Price from Tunecore -- the company that helps thousands of artists release and sell music. Jeff has more data on how artists make money than probably anyone else alive. And he says that nearly all of Lowery's factual claims are wrong, or at best, misleading. Here's a snippet, but the whole thing is worth reading:

Well here’s some truth about the old industry that David somehow misses.

Previously, artists were not rolling in money. Most were not allowed into the system by the gatekeepers. Of those that were allowed on the major labels, over 98% of them failed. Yes, 98%
.

Of the 2% that succeeded, less than a half percent of those ever got paid a band royalty from the sale of recorded music.

How in the world is an artist making at least something, no matter how small, worse than 99% of the world’s unsigned artists making nothing and of the 1% signed, less than a half a percent of them ever making a single band royalty ever?

Finally, as much as I hate to say it, being an artist does not entitle the artist to get money. They have to earn it. And not everyone can.

This is a point that Lowery and his friends always ignore: because they don't count all the bands that failed under the old system. Those artists don't matter to them. The fact that those guys can make some money today where they made $0 before means nothing to them. The only artists who count are the artists who used to make lots of money, but don't make much money any more. Another example of Lowery being wrong that Price responds to is the claim that recorded music revenue to artists has been going down. Price has data:

This is empirically false. Revenue to labels has collapsed. Revenue to artists has gone up with more artists making more money now than at any time in history, off of the sale of pre-recorded music.

Taken a step further, a $17.98 list price CD earned a band $1.40 as a band royalty that they only got if they were recouped (over 99% of bands never recouped).

If an artist sells just two songs for $0.99 on iTunes via TuneCore, they gross $1.40.

If they sell an album for $9.99 on iTunes via TuneCore, they gross $7.00.

This is an INCREASE of over 700% in revenue to artists for recorded music sales.

Yeah, but you have to actually work at it now. Go read Jeff's entire writeup. It's pretty damning for Lowery.

Next up, we've got famed musician/producer Steve Albini's response, in which he notes that Lowery's facts are wrong and he's pining for a past that doesn't exist and ignoring all sorts of new opportunities:

In addition to vastly overstating the generosity of record labels toward artists in the old paradigm, Lowery openly sneers at the booming avenues for income that define the new music industry, merchandising and live performance.

As is true every time an industry changes, the people who used to have it easy claim the new way is not just hard for them but fundamentally wrong. The reluctance to adapt is a kind of embarrassing nostalgia that glosses over the many sins of the old ways, and it argues for a kind of pity fuck from the market.

It's doomed thinking. When it became obvious that the studio recording industry was not going to remain an analog domain, we built Electrical Audio to be as self-sufficient as possible so we could continue to use those methods we thought had important advantages despite changes in the greater industry. We didn't whine at the moon and expect the rest of the industry to indulge us. We also bought a Pro Tools rig to accommodate the sessions that weren't going to be done in the analog domain regardless.

Adapt to conditions or quit. Bitching is for bitches.

Next up, we've got successful "internet-era" musician Jonathan Coulton, who Lowery and his friends are claiming wrote a post supporting them. But that's only if you read the beginning, where Coulton claims that he agrees with Lowery. If you actually read the whole thing, Coulton's point is much more clear. He agrees that artists should get compensated, but scolding your customers is no way to do it. In fact, he talks about how exciting the future is going to be where more and more stuff is available for download for free, and how that will shake up lots of industries, beyond just music -- and just how exciting that is:

This is my bias: the decline of scarcity seems inevitable to me. I have no doubt that this fight over mp3s is just the first of many fights we're going to have about this stuff. Our laws and ethics already fail to match up with our behaviors, and for my money, those are the things we should be trying to fix. The change is already happening to us, and it's a change that WE ARE CHOOSING. It's too late to stop it, because we actually kind of like a lot of the things that we're getting out of it.

My one quibble with Coulton is that he seems to accept it as fact that artists make less money these days. His own experience and number from folks like Jeff Price above show that's simply not true. It may be true that the small circle of folks, like Lowery, who had some success in the past under the old system, and who then fail to adapt, may make less money, but that's the nature of a competitive marketplace.

Former record label guy Ethan Kaplan, whose insights we've discussed before, also weighed in with a more philosophical take, which is worth reading too. He makes two key points. As a guy who ran technology for Warner Music, he certainly has first hand knowledge about the role of innovation in the music business, and according to him, innovation was seen as a problem, because it broke the gatekeeper basis on which the old labels were built:

Innovation was antithetical to value for content, as it diminished the use of accessibility to increase relative worth.

Get that? He's pointing out that the labels' entire model was built on them being the gatekeeper -- limiting accessibility, in order to artificially suppress supply to keep prices high. The problem with innovation is that it inevitably moves towards greater efficiency. And that means pulling down artificial barriers. In the end, that's what Lowery is really complaining about, even if he doesn't realize it. He and his friends who once had some success as musicians face a more difficult world not because of unethical kids or because of technology... but because the way they used to make money was based on an artificial barrier that limited supply and competition, and allowed them to artificially inflate prices. It was good for them, but sucked for everyone who was kept out of the market. Why do you think this same crew is now arguing for a "new elitism" and directly insulting artists who succeed through more open means? It's because they want to go back to a limited supply. That's not happening.

And that brings up Ethan's second key point. There is no right to make money:

It is not a musician’s god given right to make money from their art. No one ever said this would continue as is.

This is a hard lesson. It doesn’t mean that copyright isn’t important. It doesn’t mean that artists can’t make money. It just means that it’s not a given, nor is it the responsibility of others to make this possible.

No one has ever had a "right" to make money from what they create. They have a right to try to do so. And many people have figured out how to do so under the current system. Those complaining don't seem to understand that you don't just get to sit back and have people give you money. You have to work at it, every day. That's the lesson Amanda Palmer provided everyone with her massively successful fundraising. She didn't raise that money based on any "ethical" arguments or anything having to do with copyright at all. In fact, she's explained how infringement has always helped her. She's able to do that because she works hard every single day to not just create great music, but to connect with her fans at a very deep level. She doesn't scold her fans -- she celebrates them. And because of that, she can make a ton of money and her fans love her for it.

Finally, we've got musician Travis Morrison, who was in a decently successful band (Dismemberment Plan) for a while and now works for the Huffington Post. He points out that this argument that there's some sort of ethical issue with the "kids these days" ignores the fact that past generations got music for free too, and for him, it was a huge boost to both his fandom and his desire to become a musician:

Music is so important to people. It is majorly important to young people. And to me? Literally somewhere below water and air but above food. And I just went for it. I bought a lot of music; I got a lot of free music from whatever sources were at hand; I just had to have it by any means necessary. If you duped a copy of a Dismemberment Plan record in college or something, it's cool. I guess I'd like to have the money, but you know what, I hope you just listened to it with even 1/10 of the consciousness I gave to the music I listened to as a kid--copied, stolen, or bought. And you know, maybe take some of the sermonizing from my peer group with a grain of salt. I think some of them did some of the things I did. Or... maybe a lot of them.

He's basically reinforcing the original point that Emily made and which kicked this whole thing off. Access to music and compensation of artists are two separate issues. The fact is that people know that the technology today enables access to pretty much every piece of music around. And it's a shame that we try to suppress that. The issue of compensation is somewhat separate from that -- and plenty of smart musicians are figuring it out. But arguing that access automatically means you need to compensate musicians at a high level (remember, Spotify's no good according to this bunch) or it's "unethical" just doesn't make sense, and has never made sense.

This debate has been interesting, but I'm glad to see that tons of people who live directly in that world have been coming out to correct the many inaccuracies in Lowery's post, which a few too many people took as gospel without understanding the details.

Filed Under: david lowery, emily white, ethan kaplan, ethics, jeff price, jonathan coulton, steve albini, travis morrison
Companies: tunecore

DailyDirt: Death Ain't So Simple

from the urls-we-dig-up dept

Medical technology is making progress all the time, and with that progress comes new ethical questions. One of the big issues that we may need to deal with soon is determining who is really dead (or when to stop resuscitating). Growing new organs isn't quite a reliable technology, so until we can re-grow our own organs, we're not immortals. But we're not dead yet....

• An adapted excerpt from "The Undead" by Dick Teresi discusses how the definition of death has evolved with medical technology. People used to call it death when the heart stopped beating... but they don't do that anymore. [url]
• Brain dead people are being harvested for their organs, but these folks might not be as dead as you'd think. Billy Crystal might call these patients "mostly dead" -- and revive them for true love.... [url]
• Facebook encouraged over 100,000 users to register as organ donors recently. However, there's still a large unfilled need for more donors -- would getting more Facebook "likes" be a good incentive for live donors? [url]
• To discover other biological curiosities, check out what's currently floating around the StumbleUpon universe. [url]  

By the way, StumbleUpon can recommend some good Techdirt articles, too.

Filed Under: billy crystal, death, dick teresi, ethics, medicine, organ donor
Companies: facebook

Microsoft Hires Key Anti-Google FTC Lawyer To Be Its New Chief Anti-Google Lobbyist

from the paying-a-little-too-much-attention-to-the-competition dept

There's something a little... disturbing about how gleefully Microsoft seems to want to sic antitrust regulators on Google. Given that the company went through its own long antitrust battle, you'd think that it would know better than to continually invoke the government's antitrust legal beagles against others. Instead, it seems to have taken the position that if it had to go through the antitrust rollers for so long, why shouldn't other successful companies. We've noted in the past Microsoft's fingerprints showing up on bizarre and silly antitrust claims against Google -- which have so far gone nowhere -- but Microsoft seems really intent on saddling Google with a long and costly antitrust battle. I guess Microsoft thinks it's easier to fight Google that way than, you know, actually innovating and competing in the marketplace. It's pretty sad just how anti-innovation these efforts are.

Either way, Microsoft appears to be stepping up its "saddle Google with antitrust charges" battle by hiring Randall Long from the FTC. Long was the key "anti-Google" lawyer within the FTC, who led multiple antitrust investigations into Google, and recommended that the FTC block Google's acquisition of AdMob (something he was outvoted on). Microsoft doesn't even seem to want to hide the fact that his role will be to lobby politicians in DC to hit Google with antitrust charges. The WSJ's report on the hiring is pretty explicit:

As part of his new job, Mr. Long will likely continue those efforts before the FTC and other agencies, a person familiar with the matter said.

Of course, if Long actually follows the rules, he shouldn't be allowed to do anything concerning any FTC investigations into Google for quite some time. The ethics rules are pretty clear -- even barring "behind-the-scenes" help on such investigations:

Except as provided in this section, or otherwise specifically authorized by the Commission, no former member or employee (“former employee” or “employee”) of the Commission may communicate to or appear before the Commission, as attorney or counsel, or otherwise assist or advise behind-the-scenes, regarding a formal or informal proceeding or investigation...

That certainly suggests that Long cannot and should not "continue those efforts before the FTC" for some time. Either way, it's yet another example of the questionable revolving door between government and the private sector, where ex-government officials end up in roles that have a very close connection to their former government role (or vice versa). Even assuming that Long follows all the rules, as I'm sure he intends to do, this kind of thing just looks really bad.

Filed Under: antitrust, ethics, ftc, lobbyists, randall long
Companies: google, microsoft