Hollywood Has Some Wild Ideas For Copyright In NAFTA

from the everyone-creates dept

Online platforms have enabled an explosion of creativity — but the laws that make this possible are under attack in NAFTA negotiations. We recently launched EveryoneCreates.org to share the stories of artists and creators who have been empowered by the internet. This guest post from Public Knowledge's Gus Rossi explore's what's at stake.

In the past few weeks, we at Public Knowledge have been talking with decision-makers on Capitol Hill about NAFTA. We wanted to educate ourselves on the negotiation process for this vital trade agreement, and fairly counsel lawmakers interested in its effects on consumer protection. And we discovered a thing or two in this process.

It won’t surprise anyone that we don’t always agree with lobbyists for the big entertainment companies when it comes to creating a balanced copyright system for internet users. But some of the ideas these groups are advancing are widely misleading, brutally dishonest, and even dangerous to democracy. We wanted to share the two wildest ideas the entertainment industries are proposing in the new-NAFTA, so you can help us set the record straight before it’s too late:

1) Safe harbors enable child pornography and human trafficking.

Outside specialized circles, common wisdom is that “safe harbors” are free get-out-of-jail cards that internet intermediaries like Facebook can use to avoid all responsibility for anything that internet users say or do in their services. Leveraging this fallacy, entertainment industry lobbyists are arguing that safe harbors facilitate child pornography and human trafficking. Therefore, the argument follows, NAFTA should not promote safe harbors.

This is highly misleading. Safe harbors are simply legal provisions that exempt internet intermediaries such as YouTube or Twitter, and broadband providers such as Comcast or AT&T, from liability for the infringing actions of their users under certain specific circumstances. Without safe harbors, internet intermediaries would be obligated to censor and control everything their users do on their platforms, as they would be directly liable for it. Everything from social media, to internet search engines, to comments section in newspapers, would be highly restricted without some limitations on intermediary liability.

The Digital Millennium Copyright Act (DMCA) and Section 230 of the Communications Decency Act (CDA 230) establish the two most important limitations for online intermediaries in US law. According to the DMCA, internet access providers (such as Comcast, AT&T, and Verizon) are not liable for the alleged copyright infringement of users on their networks, so long as they maintain a policy of terminating repeat infringers. Content hosts (such as blogs, image-hosting sites, or social media platforms) on the other hand, have to remove material if the copyright holder sends a takedown notice of infringement.

CDA 230 says that "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Online intermediaries that host or republish speech are protected against a range of laws that might otherwise be used to hold them directly responsible for what others say and do.

The relevant safe harbor for the interests of the entertainment industries is the DMCA, not CDA 230. CDA 230 specifically excludes copyright from its umbrella. And DMCA is exclusively about copyright. It is incredible dishonest and shallow for these lobbyists to use the specter of child abuse to drum up support for their position on copyright in NAFTA. No one should try to obfuscate a complicated policy discussion by accusing their opponents of promoting child sex trafficking.

2) Exceptions and limitations to copyright are unnecessary in trade agreements.

According to none other than the World Intellectual Property Organization, exceptions and limitations to copyright -- such as fair use -- exist “[i]n order to maintain an appropriate balance between the interests of rights holders and users of protected works, [allowing] cases in which protected works may be used without the authorization of the rights holder and with or without payment of compensation.” Without exceptions and limitations, everything from using a news clip for political parody, to sharing a link to a news article in social media, to discussing or commenting on just about any work of art or scholarship -- all could constitute copyright infringement.

Yet, the entertainment industries are arguing that exceptions and limitations are outdated and unnecessary in trade agreements. They say that copyright holders should be protected from piracy and unlawful use of their works, claiming that any exceptions and limitations are a barrier to the protection of American artists.

This is also wildly inaccurate. American artists and creators remix, reuse, and draw inspiration from copyrighted works every single day. If our trade partners don’t adopt exceptions and limitations to copyright, then these creators could be subject to liability when exporting their work to foreign countries. Exceptions and limitations to copyright are necessary both in the US and elsewhere. Our copyright system simply wouldn’t work without them, especially in the digital age.

Conclusion: We need to set the record straight.

For its political and economic importance, NAFTA could be be the standard for future American-sponsored free trade agreements. But NAFTA could have dramatic and tangible domestic consequences if it undermines safe harbors and exceptions and limitations to copyright. In the next policy debate around copyright infringement or intermediaries liabilities, the entertainment industries will point to NAFTA as an example of the US Government’s stated policy and where the world is moving.

Furthermore, these lobbyists will have already convinced many on Capitol Hill that safe harbors enable child abuse and that fair use is unnecessary. The entertainment industries knows how to walk through the corridors of power day after day -- they’ve been doing so for well over a century.

It’s not too late to fight back, set the record straight, and defend a balanced approach to copyright and consumer protections in NAFTA. You can start by contacting your representative. But the clock is ticking. Join Public Knowledge in the fight to keep the internet open for everyone.

Visit EveryoneCreates.org to read stories of creation empowered by the internet, and share your own! »

Filed Under: cda 230, dmca, dmca 512, everyone creates, fair use, nafta, safe harbors, trade

On The Internet, Everyone Is A Creator

from the it's-not-a-broadcast-medium dept

Visit EveryoneCreates.org to read stories of creation empowered by the internet, and share your own! »

One theme that we've covered on Techdirt since its earliest days is the power of the internet as an open platform for just about anyone to create and communicate. Simultaneously, one of our greatest fears has been how certain forces -- often those disrupted by the internet -- have pushed over and over again to restrict and contain the internet, and turn it into something more like a broadcast platform controlled by gatekeepers, where only the chosen few can use it to create and share. This is one of the reasons we've been so adamant over the years that in so many policy fights, "Silicon Valley v. Content" is a false narrative. It's almost never true -- because the two go hand in hand. The internet has made it so that everyone can be a creator. Internet platforms have made it so that anyone can create almost any kind of content they want, they can promote that content, they can distribute it, they can build a fan base, and they can even make money. That's in huge contrast to the old legacy way of needing a giant gatekeeper -- a record label, a movie studio, or a book publisher -- to let you into the exclusive club.

And yet, those legacy players continue to push to make the internet into more of a broadcast medium -- to restrict that competition, to limit the supply of creators and to push things back through their gates under their control. For example, just recently, the legacy recording and movie industries have been putting pressure on the Trump administration to undermine the internet and fair use in NAFTA negotiations. And, much of their positioning is that the internet is somehow "harming" artists, and needs to be put into check.

This is a false narrative. The internet has enabled so many more creators and artists than it has hurt. And to help make that point, today we're launching a new site, EveryoneCreates.org which features stories and quotes from a variety of different creators -- including bestselling authors, famous musicians, filmmakers, photographers and poets -- all discussing how important an open internet has been to building their careers and creating their art. On that same page, you can submit your own stories about how the internet has helped you create, and why it's important that we don't restrict it. Please add your own stories, and share the site with others too!

The myth that this is "internet companies v. creators" needs to be put to rest. Thanks to the internet, everyone creates. And let's keep it that way.

Visit EveryoneCreates.org to read stories of creation empowered by the internet, and share your own! »

Filed Under: creativity, dmca, dmca 512, everyone creates, everyone is a creator, fair use, internet, nafta, safe harbors

Appeals Court Makes A Mess Of Copyright Law Concerning ISPs And Safe Harbors

from the this-makes-no-sense dept

We've been following the BMG v. Cox lawsuit from the very beginning, through all its very odd twists and turns, including having a judge in the district court, Liam O'Grady, who made it quite clear that he didn't much care about the internet, and didn't see why it was a problem if people lost their internet access completely based on merely a few allegations of copyright infringement. The 4th Circuit appeals court has now overturned the lower court ruling and sent the case back to the district court for a do-over. While the initial decision was awful (as we discuss below), this new ruling makes a huge mess out of copyright law and will have serious, dangerous, and long-lasting consequences for the internet as a whole.

If you don't recall, the case involved BMG suing Cox Communications, though much of the case really hinged on the actions of another company, Rightscorp, who has been trying (and mostly failing) to build a business model around a form of mild copyright trolling. Rather than the aggressive "sue 'em and settle," strategy employed by others, Rightscorp would send DMCA takedowns to ISPs, with a settlement offer, and hope that the ISPs would pass those notices on to subscribers accused of infringing.

Cox Communications -- a decently large broadband provider -- made it quite clear to Rightscorp that it did not intend to be a part of its business model, and refused to pass on the settlement letters. Rightscorp started flooding Cox with notices... to the point that Cox decided to effectively just trash all inbound messages from Rightscorp as spam. After all this happened, Rightscorp signed BMG as a client, and then sued Cox, claiming the ISP had violated the DMCA by not kicking users off. What came out during the trial was that Cox basically had a "thirteen strike" policy (some of the earlier strikes involved stopping internet access until you read something and clicked something -- or requiring the user to call in to Cox).

What is rarely noted, of course, is that Cox was basically one of the only ISPs to actually have any termination policy for people who used their connections for copyright infringement. Most ISPs (and most copyright lawyers not working for legacy industry interests) believed that the DMCA's requirement for a "repeat infringer policy" was not directed at access providers, but at content hosts, where the issues are much clearer. However, BMG claimed here that Cox violated the DMCA's requirement for a repeat infringer policy -- and the court agreed. Cox was, partly, undone by some pretty bad behavior behind the scenes, that seemed to tar it as a "bad actor" and obscure the underlying copyright issues. Even more ridiculous was that Judge O'Grady later argued that Cox should pay the other side's legal fees, because even bringing up the idea that it was protected by safe harbors was "objectively unreasonable." That, itself, was crazy, since tons of copyright experts actually think Cox was correct.

On appeal there were two key issues raised by Cox. The main issue was to argue that O'Grady was incorrect and that the DMCA safe harbors covered Cox. The second pertained to the specific jury instructions given to the jurors in the case. The new ruling unfortunately upholds the ruling that Cox is not covered by the DMCA's safe harbors, but does say that the instructions given to the jury were incorrect. Of course, it then proceeds to make a huge muddle of what copyright law says in the process. But we'll get to that.

The Impact on Safe Harbors

Let's start with the safe harbors part of the ruling, which is what most people are focusing on. As the court notes, Cox (correctly, in my view), pointed out that even if it was subject to a repeat infringer policy, that should cover actual infringers, not just those accused of infringing. After all, it's not like there aren't tons upon tons of examples of false copyright infringement accusations making the rounds, and that's doubly true when it comes to trolling operations. If the rule is that people can lose all access to the internet based solely on unproven accusations of infringement, that seems like a huge problem. But, here, the court says that it's the correct way to read the statute:

Cox contends that because the repeat infringer provision uses the term “infringer” without modifiers such as “alleged” or “claimed” that appear elsewhere in the DMCA, “infringer” must mean “adjudicated infringer.” But the DMCA’s use of phrases like “alleged infringer” in other portions of the statute indicates only that the term “infringer” alone must mean something different than “alleged infringer,” otherwise, the word “alleged” would be superfluous. Using the ordinary meaning of “infringer,” however, fully accords with this principle: someone who actually infringes a copyright differs from someone who has merely allegedly infringed a copyright, because an allegation could be false. The need to differentiate the terms “infringer” and “alleged infringer” thus does not mandate Cox’s proposed definition.

Moreover, other provisions of the Copyright Act use the term “infringer” (and similar terms) to refer to all who engage in infringing activity, not just the narrow subset of those who have been so adjudicated by a court. For example, § 501(a), which creates a civil cause of action for copyright owners, states that “[a]nyone who violates any of the exclusive rights of the copyright owner” provided for in the statute “is an infringer of the copyright or right of the author.” 17 U.S.C. § 501(a) (emphasis added).

Similarly, the DMCA itself provides that ISPs who store copyrighted material are generally not liable for removing “material or activity claimed to be infringing or based on facts or circumstances from which infringing activity is apparent, regardless of whether the material or activity is ultimately determined to be infringing.” Id. § 512(g)(1) (emphases added). This provision expressly distinguishes among three categories of activity: activity merely “claimed to be infringing,” actual “infringing activity” (as is apparent from “facts or circumstances”), and activity “ultimately determined to be infringing.” The distinction between “infringing activity” and activity “ultimately determined to be infringing” in § 512(g) shelters ISPs from being liable for taking down material that is “infringing,” even if no court “ultimately determine[s]” that it is infringing — because, for example, the copyright holder simply does not file a lawsuit against the person who uploaded the infringing material. As this provision illustrates, Congress knew how to expressly refer to adjudicated infringement, but did not do so in the repeat infringer provision.

Again, the obvious implications of this are... insane. It means that you can potentially get people completely kicked off the internet with a series of knowingly false accusations of copyright infringement. How could anyone justify that as a reasonable policy?

The court insists that the legislative history supports this... but the only way it does is if you torture the legislative history and ignore what it says. Here's what the court says:

The legislative history of the repeat infringer provision supports this conclusion. Both the House Commerce and Senate Judiciary Committee Reports explained that “those who repeatedly or flagrantly abuse their access to the Internet through disrespect for the intellectual property rights of others should know that there is a realistic threat of losing that access.” H.R. Rep. No. 105-551, pt. 2, at 61 (1998); S. Rep. No. 105-190, at 52 (1998). This passage makes clear that if persons “abuse their access to the Internet through disrespect for the intellectual property rights of others”—that is, if they infringe copyrights — they should face a “realistic threat of losing” their Internet access.

But, again, based on the ruling here, this still applies even if the accusations are totally false and no infringement occurred. The court seems to ignore the word "abuse" in this statement and doesn't even bother to consider that there may be abuse on the other side -- in the form of copyright trolling against non-infringers (or simply trying to harm or silence the speech of a non-infringer).

Next up, the court has to determine whether or not Cox's repeat infringer policy was "reasonable." This, itself, is a minefield. The law provides no guidance beyond that to qualify for the safe harbor the provider has to have "adopted and reasonably implemented... a policy that provides for the termination in appropriate circumstances of subscribers... who are repeat infringers." That seems to leave an awful lot of discretion to the provider -- which the court admits... before determining that it doesn't think Cox's policy was reasonably implemented. And this is where a few bad actions by Cox employees comes back to haunt the company:

Here, Cox formally adopted a repeat infringer “policy,” but, both before and after September 2012, made every effort to avoid reasonably implementing that policy. Indeed, in carrying out its thirteen-strike process, Cox very clearly determined not to terminate subscribers who in fact repeatedly violated the policy.

The words of Cox’s own employees confirm this conclusion. In a 2009 email, Jason Zabek, the executive managing the Abuse Group, a team tasked with addressing subscribers’ violations of Cox’s policies, explained to his team that “if a customer is terminated for DMCA, you are able to reactivate them,” and that “[a]fter you reactivate them the DMCA ‘counter’ restarts.” The email continued, “This is to be an unwritten semi-policy.” Zabek also advised a customer service representative asking whether she could reactivate a terminated subscriber that “[i]f it is for DMCA you can go ahead and reactivate.” Zabek explained to another representative: “Once the customer has been terminated for DMCA, we have fulfilled the obligation of the DMCA safe harbor and can start over.” He elaborated that this would allow Cox to “collect a few extra weeks of payments for their account. ;-).” Another email summarized Cox’s practice more succinctly: “DMCA = reactivate.” As a result of this practice, from the beginning of the litigated time period until September 2012, Cox never terminated a subscriber for infringement without reactivating them.

One would hope that this part of the ruling would at least, somewhat, protect other ISPs that don't send stupid emails like that. But, you never know.

The Messed Up Jury Instructions

To fully follow the issues here, we have to take a quick tour to key copyright cases of years past. In the Betamax Case, Hollywood sued the makers of VCR devices (okay, okay, Betamax devices) for selling a product that its customers used to infringe. In 1984, the Supreme Court said that was crazy, and since the VCR had "substanitial non-infringing uses," it was legal to sell it, even if it was used to infringe. Almost 20 years later, the Supreme Court chopped away at this standard a bit in the unfortunate (and still wrong) Grokster case, that said even if the tool had substantial non-infringing uses, if the company "induced" infringement, then it could still be liable. But there had to be fairly strong evidence of actual inducement by the company -- in Grokster, the company more or less encouraged people to infringe.

Cox asked the court to use the Betamax standard in the jury instructions, saying that it's not contributory copyright infringement if there are substantial non-infringing uses -- but the lower court rejected that, and this court does too, pointing to Grokster (but not actually groking what the Grokster court said). But a second complaint about the jury instructions does win the support of the appeals court. Cox, rightly, argued that the jury instruction telling jurors that the standard for contributory infringement was if the company "knew or should have known of such infringing activity." The big problem here is the "should have known" part. That is not the law. It's not in the law. It's not supported by court decisions and has been rejected by numerous court decisions. And, here, the court finally gives Cox a break and says that those jury instructions went too far. "Should have known" is a negligence standard -- it suggests even if you didn't know, you were negligent in not knowing, and therefor still liable. But copyright law demands actual knowledge. And thus, the original ruling is thrown out and sent back to the court.

But... even with the jury verdict being tossed, this discussion is... weird. And troubling. Remember, the Grokster standard is about "inducement" which involved a level of intent on the part of the service provider. That's about taking specific actions to encourage the use for infringement. But, the court here keeps slipping into a separate question of "knowledge." The knowledge question and the inducement/intent question are two separate questions. But it's not clear that the court even realizes that. It keeps going back and forth between questions about inducement and questions about actual knowledge, to the point that it almost appears the court thinks these are the same things. But knowledge alone is not enough to prove a party induced others to infringe on a copyright.

See the following discussion:

First, Grokster’s recitation of the standard—that “[o]ne infringes contributorily by intentionally inducing or encouraging direct infringement” — is on its face difficult to reconcile with a negligence standard. See 545 U.S. at 930 (emphasis added). In addition, it would have been unnecessary for the Court to discuss in detail the situations in which intent may be presumed, and those situations, like Sony, in which it may not, if liability did not require intent at all, but merely required negligence....

Looking to patent law, as the Supreme Court did in Sony and Grokster, further counsels against a negligence standard. The Supreme Court has long held that contributory patent infringement requires knowledge of direct infringement. Aro Mfg. Co. v. Convertible Top Replacement Co., 377 U.S. 476, 488 (1964). And in 2011, the Court held that willful blindness satisfies this knowledge requirement, but recklessness (“one who merely knows of a substantial and unjustified risk of . . . wrongdoing”) and negligence (“one who should have known of a similar risk but, in fact, did not”) do not. Global-Tech, 563 U.S. at 769–71. The Court reaffirmed this holding in 2015, stating that contributory patent infringement “requires proof the defendant knew the acts were infringing,” and that Global-Tech “was clear in rejecting any lesser mental state as the standard.” Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct. 1920, 1928 (2015). The Court expressly rejected the possibility “that a person, or entity, could be liable even though he did not know the acts were infringing.” Id. Thus, in the patent context, it is clear that contributory infringement cannot be based on a finding that a defendant “should have known” of infringement.

In both Grokster and Sony, the Supreme Court adopted now-codified patent law doctrines— the staple article doctrine and the inducement rule. The Court did so because of “the historic kinship between patent law and copyright law,” Sony, 464 U.S. at 439–42, and the similar need in both contexts to impose liability on “culpable expression and conduct” without “discouraging the development of technologies with lawful and unlawful potential,” Grokster, 545 U.S. at 936–37. We are persuaded that the Global-Tech rule developed in the patent law context, which held that contributory liability can be based on willful blindness but not on recklessness or negligence, is a sensible one in the copyright context. It appropriately targets culpable conduct without unduly burdening technological development.

Note that the first paragraph is about inducement, which has specific characteristics, and the latter two are about "knowledge." But knowledge isn't what proves the intent for inducement. So... even as it's right to kick this back to the lower court, it feels like the 4th Circuit got twisted up by its own reasoning.

Then there's the issue of what the court means when it talks about "specific instances of knowledge." See this paragraph:

Selling a product with both lawful and unlawful uses suggests an intent to cause infringement only if the seller knows of specific instances of infringement, but not if the seller only generally knows of infringement. See Ludvarts, 710 F.3d at 1072 (holding that contributory copyright infringement “requires more than a generalized knowledge . . . of the possibility of infringement”; it requires “specific knowledge of infringement”). A seller who only generally knows of infringement is aware that “some of [his] products will be misused” — but critically, not which products will be misused.

This same issue came up in the Viacom v. YouTube case, in which it was found that YouTube wasn't infringing just because it had "general knowledge" that it was hosting some infringing content. It could only be liable if it had actual knowledge of infringing content and then failed to take it down. But... how the hell do you apply that standard here? You can see how it would apply to YouTube, where YouTube can go and see the file still hosted on its servers after being notified that it's infringing and then check to see that it is, indeed, the same material as the copyright holder claims. For an ISP, however, where the data is in motion, as opposed to at rest, all you have to go on are these often erroneous notifications from Rightscorp claiming infringement. But by the time an ISP like Cox would look at it... the transmission would be complete. So how can Cox have "actual knowledge" of infringement -- absent a court ruling that the activity was infringing (bringing us all the way back around to the first point made above)?

Either way, this case is hardly over yet, as there's still another trial to now go through. But, as it stands, it's making a big mess out of copyright law. And that's not good.

Filed Under: actual knowledge, copyright, dmca, dmca 512, inducement, infringement, jury instructions, knowledge, safe harbors, termination policy
Companies: bmg, cox, rightscorp

MPAA Wins: Australia To Carve Google And Facebook Out Of Its Expanded Safe Harbor Provisions

from the rights-for-only-some dept

Back in November, we discussed some reforms Australia was looking to make to its copyright laws. Chiefly at issue was how safe harbors were incorporated into the law, with those provisions applying only to primary service providers like ISPs due entirely to what appears to be a simple poor choice of words in the law. Under strict reading of the law as written, websites, libraries, and schools that allow internet users to create their own content and engage online would not be subject to safe harbor provisions, unlike the country's American counterpart. The government initially signaled that it wanted to harmonize its law with EU and American law, before the lobbying dollars of the entertainment industry sprung into action, causing the government to walk this back a bit.

And, now, it seems that all it took was some meager conversation between government officials and industry representatives for safe harbors to be yanked away from the usual MPAA targets.

Shortly after the government embarked on a detailed consultation with entertainment industry groups. They accuse platforms like YouTube of exploiting safe harbor provisions in the US and Europe, which forces copyright holders into an expensive battle to have infringing content taken down. They do not want that in Australia and at least for now, they appear to have achieved their aims.

According to a report from AFR, the Australian government is set to introduce new legislation Wednesday which will expand safe harbors for some organizations but will exclude companies such as Google, Facebook, and similar platforms.

What should be immediately obvious is the complete lack of logic for this type of move. Either safe harbor provisions should filter down from the primary ISPs or they shouldn't. Carving out exceptions to these important provisions, which serve primarily to increase expression and foster activity on the internet, strictly to some of the most popular platforms on that internet at the behest of movie-makers is the sort of thing that one struggles to describe as something other than purely the sale of national law to commercial interests. Oddly, the government has confirmed that safe harbor would apply to the afore-mentioned library, culture and archive spaces, just not to Google and Facebook, which arguably do as much as any other sites for culture and to archive information.

This action is also a useful data point for anyone to keep in mind when the entertainment industry discusses American and EU safe harbor provisions. It's clear by this involvement with the laws of a sovereign nation that those groups hate safe harbor laws and would like nothing more than to do away with them entirely. Let's all just keep that in mind whenever some mewing spokesperson for the entertainment industry wants to comment on our own safe harbor laws domestically.

Filed Under: copyright, free speech, innovation, intermediary liability, safe harbors
Companies: facebook, google, mpaa

Hollywood Using Trump To Undermine The Internet In NAFTA Talks

from the this-is-bad dept

As you may be aware, the US, Canada and Mexico are "renegotiating NAFTA" for reasons that don't entirely make sense, but we'll leave that aside. Either way, opening up that process has created an opportunity for Hollywood to attack the internet, and they've rushed right in. And, despite promises to the contrary, it appears that Hollywood may have succeeded in getting the Trump administration's US Trade Representative to back its dangerous plans.

To fully explain this requires a bit of a history lesson. A few decades back, Hollywood realized that what it couldn't get Congress to pass, it could force upon the US through "international trade agreements." Much of the history of what happened is detailed in the excellent 2002 book, Information Feudalism by Peter Drahos and John Braithwaite. The very short version is this: international trade agreements have mostly been negotiated without much fanfare or attention, often in secret, with handshake deals in backrooms. And since "trade agreements" are about industry and commerce, trade negotiators often spend most of their time listening to industry representatives to figure out what they want, rather than looking at what's best for everyone as a whole.

The legacy entertainment middlemen (very cleverly!) realized this long before many others did, and realized that if they could make copyright a "trade" issue, they could continually ratchet up the protectionist parts of copyright law. The plan involves a few clever components. First, find a few countries where they can convince local legislatures to pass ever more draconian copyright laws. Second, put pressure on trade negotiators to put similar provisions into trade agreements. Third, whine about countries (including the US) "failing to live up to the obligations of our international trade agreements" and forcing everyone to ratchet up their copyright laws to "comply." Wash, rinse, repeat.

This is actually how the DMCA itself became law in the US (which is ironic as you'll see in a moment). Hollywood tried to pass a DMCA-like law in the US in the mid-1990s and it failed. So, as the main architect of this plan publicly admitted a few years ago, they did "an end-run around Congress," ran to Geneva, and got a new trade agreement -- the WIPO Copyright Treaty -- passed. And then they scurried right back to Congress, and said to meet the obligations of the WIPO Copyright Treaty, we needed the DMCA.

Since then, Hollywood has pushed for draconian copyright requirements in basically every trade agreement, and the USTR was only too happy to oblige. Ridiculously, the USTR, while pushing ever more draconian copyright law around the globe through trade agreements, has flatly refused to also include fair use or equivalent "safety valves" to keep the law from being abused. Of course, as we've discussed for years, these "safety valves" -- generally called "limitations and exceptions" -- are actually fundamental user rights. In short: the USTR has pushed for rights for big corporations, while refusing to include the necessary rights for the public. That's a dangerous combination.

That brings us to the ongoing NAFTA renegotiation. Hollywood has been whining about the DMCA's safe harbors quite a bit in the past few years (yes, the same safe harbors that are from the DMCA that it forced the US to pass via international trade agreements). So far, however, heavy lobbying by the RIAA and MPAA to do away with the DMCA's safe harbors has failed to convince Congress (in part because Congress has seen through this game and, in part, because Congress still remembers what happened with its attempt to undermine the internet through copyright law with SOPA).

But, hey, with the reopening of NAFTA, Hollywood saw an opportunity, and has pushed for language that will undermine the DMCA's safe harbors and fair use -- things they can't get through Congress alone. Unfortunately, the latest reports are that the USTR has agreed to support this move and, even though it's been shown that more balanced copyright promotes trade, the US is now officially putting more draconian copyright on the agenda -- a move that risks undermining the entire internet, not to mention a major backlash from internet users as well.

Needless to say, this is bad. Some in Congress are speaking up on this, but it's falling along the traditional lines. Senator Ron Wyden has made it clear that he's "deeply concerned" that the Trump administration is willing "to undermine the internet as a platform for speech, innovation and US jobs" with the NAFTA renegotiation. On the flip side, you have Orrin Hatch -- a Senator so closely associated with giving the legacy entertainment industry everything it's ever wanted, that he's given the nickname "Senator Fido" (as in "lapdog") in Rob Reid's comic novel about the music industry. Hatch has spoken up in support of Hollywood, saying that while it's fine to reopen the DMCA's safe harbors, there should be no mention of fair use or any other user rights in these negotiations.

At this point, it appears that Canada is left pushing back on the US's crazy Hollywood-inspired demands. Of course, Canada's suggestions aren't all wonderful either, but at least it's pushing for a more balanced approach -- one that actually recognizes the rights of the public and the importance of protecting free speech, while the USTR (pushed by Hollywood) seems to have decided to throw that right out the window.

Obviously, there are so many other things going on these days, that it's easy to miss the background of "NAFTA 2.0" negotiations. But at this point, it appears that Trump's USTR -- at the urging of Hollywood -- is trying to use these negotiations to do real damage to free speech and innovation online. Taking away the DMCA's safe harbors and refusing to include important protections like fair use in any copyright language should be seen as a non-starter. As we've argued for years, copyright is best left out of trade agreements altogether, but if it does need to be in there, giving Hollywood it's wishlist plan to destroy the internet shouldn't be the USTR's top priority.

Filed Under: copyright, dmca, fair use, international obligations, nafta, safe harbors, user rights, ustr

Dangerous Ruling On DMCA Safe Harbors May Backfire On Hollywood

from the be-careful-what-you-wish-for,-mpaa dept

Late last week an important, but disappointing, ruling came down from the 9th Circuit appeals court. The ruling in the case of Mavrix Photographs v. LiveJournal found that volunteer moderators could be deemed agents of a platform, and thus it's possible that red flag knowledge of infringement by one of those volunteer moderators could lead to a platform losing its safe harbors. There are a lot of caveats there, and the ruling itself covers a lot of ground, so it's important to dig in.

The case specifically involved a site hosted on LiveJournal called "Oh No They Didn't" (ONTD) which covers celebrity news. Users submit various celebrity stories, and ONTD has a bunch of volunteer moderators who determine what gets posted and what does not. Some of the images that were posted were taken by a paparazzi outfit named Mavrix. Rather than send DMCA takedowns, Mavrix went straight to court and sued LiveJournal. LiveJournal claimed that it was protected by the DMCA safe harbors as the service provider and the lower court agreed. This ruling sends the case back to the lower court, saying that its analysis of whether or not the volunteer moderators were "agents" of LiveJournal was incomplete, and suggests it tries again.

There are a number of "tricky" issues involved in this case, starting with this: because ONTD became massively big and popular, LiveJournal itself got a bit more involved with ONTD, which may eventually prove to be its undoing. From the decision by the court:

When ONTD was created, like other LiveJournal communities, it was operated exclusively by volunteer moderators. LiveJournal was not involved in the day-to-day operation of the site. ONTD, however, grew in popularity to 52 million page views per month in 2010 and attracted LiveJournal’s attention. By a significant margin, ONTD is LiveJournal’s most popular community and is the only community with a “household name.” In 2010, LiveJournal sought to exercise more control over ONTD so that it could generate advertising revenue from the popular community. LiveJournal hired a then active moderator, Brendan Delzer, to serve as the community’s full time “primary leader.” By hiring Delzer, LiveJournal intended to “take over” ONTD, grow the site, and run ads on it.

As the “primary leader,” Delzer instructs ONTD moderators on the content they should approve and selects and removes moderators on the basis of their performance. Delzer also continues to perform moderator work, reviewing and approving posts alongside the other moderators whom he oversees. While Delzer is paid and expected to work full time, the other moderators are “free to leave and go and volunteer their time in any way they see fit.” In his deposition, Mark Ferrell, the General Manager of LiveJournal’s U.S. office, explained that Delzer “acts in some capacities as a sort of head maintainer” and serves in an “elevated status” to the other moderators. Delzer, on the other hand, testified at his deposition that he does not serve as head moderator and that ONTD has no “primary leader.”

It's this oversight by a paid employee of LiveJournal that makes things a bit sticky. The question is whether or not this oversight and control went so far that the volunteer moderators could also be seen as "agents" of LiveJournal, rather than independent users of the platform.

Evidence presented by Mavrix shows that LiveJournal maintains significant control over ONTD and its moderators. Delzer gives the moderators substantive supervision and selects and removes moderators on the basis of their performance, thus demonstrating control. Delzer also exercises control over the moderators’ work schedule. For example, he added a moderator from Europe so that there would be a moderator who could work while other moderators slept. Further demonstrating LiveJournal’s control over the moderators, the moderators’ screening criteria derive from rules ratified by LiveJournal

The court doesn't fully answer the question, but sends it back to the lower court, saying that it's a "genuine issue of material fact" that should be explored to determine if LiveJournal was responsible, and thus would lose its safe harbors. The specific fact pattern and details here may mean that this ruling doesn't turn out to be a huge problem in the long run for safe harbors, but... it is somewhat worrisome, in that there are at least a few statements in the ruling that are... concerning. For example:

... LiveJournal relies on moderators as an integral part of its screening and posting business model.

But... lots of sites rely on independent and volunteer moderators as a part of their business model. That alone shouldn't matter as to whether or not a volunteer is truly an agent of the company.

A larger issue may be the simple fact that even if a moderator is deemed to be an "agent" of a platform, if they're not experts in copyright, it would be ridiculous to then argue that their own failure to stop infringement makes an entire company liable. That would doom many websites that rely on volunteer help. If one were to mess up and not understand the vast nuances of copyright law, the liabilities for the platform could be immense. As Parker Higgins notes, the expectation here is unbalanced in a ridiculous way, especially as this very same court doesn't seem to think that the sender of a DMCA takedown should take as much responsibility for its actions:

Still, even if the moderator draws a paycheck from the platform, it seems unreasonable to expect them to approach thorny copyright questions with the nuance of a trained professional. That is especially true when you compare this ruling with the Ninth Circuit’s most recent opinion in Lenz v. Universal, the “dancing baby” case, which looks down the other end of the copyright gun at takedown notice senders. Notice senders must consider fair use, but only so far as to form a “subjective good faith belief” about it. If courts don’t require the people sending a takedown notice to form an objectively reasonable interpretation of the law, why should they impose a higher standard on the moderators at platforms handling staggering quantities of user uploads?

But if moderators are a platform’s “agents,” then it runs into trouble if they have actual or “red flag” knowledge of infringements. The Ninth Circuit has instructed the lower court to find out whether the moderators had either. Noting the watermarks on some of the copyrighted images in the case, the court phrased the question of “red flag” knowledge as whether “it would be objectively obvious to a reasonable person that material bearing a generic watermark or a watermark referring to a service provider’s website was infringing.” That’s an important point to watch. Copyright ownership and licensing can be extremely complex — so oversimplifying it to the idea that the presence of a watermark means any use is infringing would have profound negative consequences.

And this is why this ruling may backfire for Hollywood -- even as it pushed the court to rule this way. As EFF notes, at the very time that the MPAA is demanding that platforms do more to moderate content, the implications of this ruling may force them to do much less moderation:

The fact that moderators reviewed those submissions shouldn’t change the analysis. The DMCA does not forbid service providers from using moderators. Indeed, as we explained in the amicus brief (PDF) we filed with CCIA and several library associations, many online services have employees (or volunteers) who review content posted on their services, to determine (for example) whether the content violates community guidelines or terms of service. Others lack the technical or human resources to do so. Access to DMCA protections does not and should not turn on this choice.

The irony here is that copyright owners are constantly pressuring service providers to monitor and moderate the content on their services more actively. This decision just gave them a powerful incentive to refuse.

There are a few other issues in this case that are also potentially problematic. As Annemarie Bridy points out over at Stanford's Center for Internet & Society, the court seems to totally mess up the analysis of the DMCA's safe harbors by confusing part (a) of the DMCA 512 (which applies to network providers) and part (c) (which applies to online service providers):

According to the court, the section 512(a) safe harbor covers users’ submission of material to providers, and section 512(c) covers the providers’ subsequent posting of that material to their sites. There is no such submission-posting distinction in section 512. On the face of the statute and in the legislative history, it’s quite clear that section 512(a) is meant to cover user-initiated, end-to-end routing of information across a provider’s network. A residential broadband access provider is the paradigmatic section 512(a) provider. Section 512(c) covers hosting providers like LiveJournal that receive, store, and provide public access to stored user-generated content. To characterize LiveJournal as a hybrid 512(a)/512(c) provider misapplies the statute and introduces into the case law a wrongheaded distinction between submitting and posting material.

Putting aside the peculiar submission-posting dyad, the dispositive question concerning LiveJournal’s eligibility for the section 512(c) safe harbor is whether the site’s moderator-curated, user-submitted posts occur “at the direction of users,” taking into consideration the nature of moderators’ review and the fact that only about one-third of user submissions are ultimately posted. That question can be answered entirely within the ambit of section 512(c) and the existing case law interpreting it, including the Ninth Circuit’s own decision in Shelter Capital. There was simply no need for the court to invoke section 512(a) in this case.

The court's analysis here is... just weird. It's on page 13 of the ruling, and it really does seem to take a totally unchartered path in arguing that the submission of content is covered by 512(a) while the posting is covered by (c). But... that's wrong:

The district court focused on the users’ submission of infringing photographs to LiveJournal rather than LiveJournal’s screening and public posting of the photographs. A different safe harbor, § 512(a), protects service providers from liability for the passive role they play when users submit infringing material to them.... The § 512(c) safe harbor, however, focuses on the service provider’s role in publicly posting infringing material on its site.

Among the other issues with this case, there's also one on the question of whether or not the anonymous volunteer moderators should be disclosed. As we've discussed in the past, because the First Amendment also protects anonymity, any move to reveal an anonymous commenter must be carefully weighed against their First Amendment right to anonymity. The court here more or less brushes off this issue, saying that once the lower court determines the level of agency, that will answer the question on preserving anonymity:

Notwithstanding the deferential standard of review and complex issues of law that govern this discovery ruling, we vacate the district court’s order denying the motion and remand for further consideration. Whether the moderators are agents should inform the district court’s analysis of whether Mavrix’s need for discovery outweighs the moderators’ interest in anonymous internet speech. Given the importance of the agency analysis to the ultimate outcome of the case, and the importance of discovering the moderators’ roles to that agency analysis, the district court should also consider alternative means by which Mavrix could formally notify or serve the moderators with process requesting that they appear for their deposition at a date and time certain.

This is yet another important case in determining how online platforms can actually function today -- and rulings that undermine safe harbors like the DMCA frequently seem to be what Hollywood wants -- but again, this may backfire. Making it harder for these sites to function if they're actively involved in moderation only means they'll do much less of it.

Filed Under: 9th circuit, copyright, dmca, moderators, safe harbors
Companies: livejournal, mavrix

Supreme Court Won't Hear Case About Copyright Protection Of Pre-1972 Sound Recordings

from the and-other-news-about-pre-1972 dept

For many years now, we've been talking about the copyright questions surrounding pre-1972 sound recordings. There are a ton of ongoing cases about this and it may be a bit confusing to keep up with it all. In short, under old copyright law, copyright only applied to the composition itself, but not the recordings. Many states then tried to step in and created state copyright laws (or common law doctrine via the courts) that gave sound recordings some form of copyright protection -- some of it much crazier than ordinary copyright law. Eventually Congress federalized copyright for sound recordings, but it didn't apply to any sound recordings from before 1972 (and a few at the very, very, very beginning of 1972, but it's easier just to say "pre-1972 sound recordings.") And then, even though the 1976 Copyright Act took away state copyright laws having any power, they still applied to certain aspects of pre-1972 sound recordings. This has... made a mess of things. The easiest solution would be to just admit this is dumb and say that pre-1972 works should be covered by federal copyright law, but lots of folks have been against this, starting with the RIAA (more on that in a bit).

And with things being confusing, some copyright holders have been using the weird status on pre-1972 sound recordings to effectively try to shakedown online streaming music sites into giving them better deals. The various cases have been all over the place, with the first few cases coming out saying that because pre-1972 sound recordings aren't covered under federal copyright law, things are different and copyright holders can sue over them. This upended decades of what was considered settled law.

Last summer, in a related case on a slightly different issue, the Second Circuit completely ripped to shreds the argument from the record labels that the DMCA's safe harbors don't apply to pre-1972 sound recordings. The labels were going on a quixotic attack against the video hosting site Vimeo, and because the DMCA's safe harbors protected that site, it argued that pre-1972 sound recordings didn't qualify. The lower court had ruled the other way, opening up a world of problems for any website that hosted audio. Thankfully, the 2nd Circuit reversed it. Of course, the labels asked the Supreme Court to hear the appeal, specifically arguing that the 2nd Circuit's ruling had to be in error because it was "contrary to the considered view of the United States Copyright Office."

The Supreme Court, thankfully, declined to hear the case on Monday. This is a big win for the DMCA's safe harbors. While the 2nd Circuit's ruling only has precedence in that one region, the 2nd Circuit is fairly well respected and influential on the other circuits -- and having the Supreme Court refuse to take up the issue, at the very least, suggests that the Supreme Court doesn't see that reading as particularly egregious.

Meanwhile, there are other things afoot regarding the legal status of pre-1972 sound recordings. Late last year, we noted that the big win for the copyright holders in NY was overturned, and it was decided that, contrary to what some copyright holders have been arguing, there was no "performance" right under NY's state copyright, and thus they can't magically argue that such a right applies to pre-1972 works. Then, earlier this month, out here in California, the 9th Circuit told the California Supreme Court to explore the issue concerning whether or not California's state copyright law provided some proto-performance right to pre-1972 works.

And, just a few days after that, the state of Georgia's Supreme Court ruled that pre-1972 sound recordings can be played by streaming sites, and some copyright holders can't bring "RICO" claims (IT'S NEVER RICO!!!!!!) just because iHeartRadio plays those songs.

As more and more courts seem to be cutting off this attempted path used by record labels to shake down online services, it appears that maybe even the RIAA is having a change of heart. As you may recall, back at the top of the post, I noted that the RIAA was one of the leading voices insisting that it would be horrible to bring pre-1972 sound recordings under federal copyright law a few years ago. If they hadn't blocked proposals along those lines, none of this mess would have happened. That's why I find it somewhat surprisng, that one of the RIAA's favored front groups, musicFIRST, has been banging the drum this year, suddenly insisting that pre-1972 sound recordings should be treated the same as post-1972 works. Maybe, just maybe, the RIAA should have taken that position originally, rather than hoping to keep the copyrights separate so that it could force internet companies to pay more.

Filed Under: california, copyright, dmca, georgia, ny, pre-1972 sound recordings, safe harbors, scotus
Companies: riaa, vimeo

Australian Govt.: Just Kidding On That Whole Safe Harbors Reform Thing, Guys

from the lobbying-works dept

It was just last week that we discussed the pleasant news that Australia's Prime Minister was backing the idea of reforming the country's safe harbor laws, which are far out of line with much of the world as the result of poor wording. The whole thing can be basically summarized thusly: in Australia, safe harbor protections only apply to commercial ISPs, as opposed to service providers like websites or institutions that offer internet access, because someone decided to use the term "carriage service providers" in the law as opposed to simply "service providers." Essentially everyone agrees this was done in error as opposed to intentionally, yet it's been decades and nobody has bothered fixing the law.

Until some members of the government revived an attempt to do so and got the Prime Minister's support. Doing so would have put Australian law on equal footing with the EU and American safe harbor provisions, meaning that service providers generally couldn't be scapegoated for the actions of a third party. You know, holding the actual people culpable of a crime accountable instead of the service provider.

Well, that sane approach was no match for lobbying dollars, it seems, as the Australian government is yanking the safe harbor reform section out of its copyright bill entirely.

The Australian government has dropped plans to extend safe harbours from a new piece of legislation that will amend the country’s copyright laws. The Australian government had planned to bring the country’s safe harbour rules more in line with those in the US and Europe. However, the local media and entertainment industries hit out at that proposal, pointing out that the wider safe harbour had proven controversial in America and the European Union, and that moves were afoot in the latter to limit safe harbour protection for user-upload platforms.

With all that in mind, lobbyists for the content owners argued, a rigorous review should be undertaken before any changes to Australian safe harbour rules are considered by lawmakers. Yet the safe harbour reform hadn’t been subject to a proper consultation like the other proposals in the Copyright Amendment Bill.

Because it's simple morality: you don't blame someone who didn't commit an illegal action. On top of that, safe harbor provisions in America have only been held as controversial by lawsuit-happy lawyers and entertainment companies that see a potential profit center in service providers. After all, suing individuals is both difficult and a PR nightmare. Suing faceless websites or schools? Not so much.

Now the lobbyist-puppets in the government are pitching the removal as a way to have "evidence-based hearings" on the safe harbor proposals, except it should go without saying that evidence isn't often the basis of anything that comes out of entertainment industry lobbyists to begin with. Between inflated piracy statistics, inflated impact of copyright on inflated industries, and inflated claims about dollars lost, who but someone with their hand out even looks to the entertainment industry for any kind of valid analysis on any of this?

Besides: the whole safe harbor question has arisen from a miswording in the law. It seems that low of a hurdle to reform ought not need public hearings to leap over it.

Filed Under: australia, copyright, intermediary liability, safe harbors

Australia's Prime Minister Supports Expanded Safe Harbor Protections Down Under

from the good-news dept

The history of copyright law in Australia is somewhat tortured, with the government there far too often bending the knee to entertainment industries both local and abroad. Still, while much of this history is fraught with protectionism reared intentionally, one of the more curious aspects of Australian copyright law appears to have originated as something of an accident. That aspect is that the kind of safe harbor protections that exist in America are rather limited in Australia. Specifically limited to commercial ISPs, as opposed to websites or institutions that provide internet access generally speaking. We'll get a bit more into how this came to be in a moment. We'll start instead with news that recently offered amendments to copyright law in the country that would shore up safe harbor protections more generally have received the support of Australian Prime Minister Malcom Turnbull.

To solve this problem and put Australia on a similar footing to technology companies operating in the United States, proposed amendments to the Copyright Act will see all of the above receiving enhanced safe harbor protections while bringing the country into compliance with AUSFTA.

But for now, momentum appears to be shifting in favor of the technology platforms. A report in The Australian (paywall) indicates that Prime Minister Malcolm Turnbull has given the safe harbor amendments his support. It won’t be all plain sailing from here, however.

And that rocky road to harmonizing Australian copyright law with the EU and America is being laid by the usual entertainment industry suspects, whose objections are familiar tropes. Music and entertainment groups are complaining that offering safe harbor protections to such unworthy entities as schools and libraries, along with websites like Google and Facebook, amounts to codifying piracy. That's silly for all the reasons you should already know, but which can be best stated as it being quite dumb, and immoral, to saddle a third party with the guilt of a pirate just because it's an easier and more lucrative target. Because that's all this opposition amounts to: the desire to sue a school if a student infringes copyright. Or Google. Or a museum that provides internet access. This is what the entertainment industry wants to go to bat over.

But this gets really dumb when you consider that the lack of safe harbor protections in question was the result essentially of a poor choice of words over a decade ago.

The problem in Australian arose in the implementation of AUSFTA when the term “carriage service provider” (a technical terms for telecommunications companies and ISPs) was used rather than the wider “service provider” definition in the treaty.

“This places Australia at a competitive disadvantage” says Trish Hepworth. “Australian providers of common activities - transmitting data, caching, hosting and referring users to an online location – lack the protections and certainties enjoyed by their overseas competitors. It places schools, universities and libraries in a risky position as they go about their everyday business. ”

Reformers have been trying for ten years to correct this error, but they have been stymied at every turn by entrenched industry lobbyists. But now, with the Prime Minister throwing his weight behind expanded protections, there's a road map for a change in the law. The Australian government will be holding Senate hearings to debate the amendments, and you can be sure that the entertainment industry will be well represented within them, but a PM endorsement is a big deal. Hopefully our Aussie friends will get this right.

Filed Under: australia, copyright, intermediary liability, malcolm turnbull, safe harbors, service providers