Appeals Court Punts On The Constitutionality Of Copyright Royalty Board

from the another-issue-for-another-time dept

While much of the focus on royalty rates has focused on the settlement between webcasters and SoundExchange, in a separate issue, an appeals court has sided with the Copyright Royalty Board in the rates it set for satellite radio (SoundExchange wanted the rates to be even higher, of course). The court found no reason to rule against the CRB, finding no evidence that the rates were "arbitrary, capricious, or unsupported by substantial evidence." But, perhaps drawing more focus was that, in this case, there were some side questions about the very legitimacy of the Copyright Royalty Board itself. This is due to a recognition (first in the patent space) that some of these appointments appear to violate the appointments clause of the Constitution.

While I do have serious questions about the legitimacy of the CRB, it's got a lot less to do with the appointments clause, and a lot more to do with the question of why judges are setting universal royalty rates in an industry, rather than letting the market set the rate -- especially when the CRB judges often do not appear to be particularly internet literate. So the whole appointments issue seems like a side show. Even if a court were to find that the CRB violates the appointments clause, I'm sure a hasty solution would be worked out, whereby those allowed to make appointments (the president or heads of cabinet-level departments) would simply rubber stamp the appointments.

Either way... it doesn't seem to matter just yet. In ruling on the latest case, basically the issue was punted, saying that the matter wasn't raised in a timely manner, and therefore the question will be ignored for now.

Filed Under: appointments clause, constitution, copyright, copyright royalty board

Jammie Thomas Decides To Appeal Constitutionality Of $1.92 Million Damages Award

from the and-away-we-go... dept

As we speculated earlier this week, given the silence from the Jammie Thomas camp since the $1.92 million verdict against her, we assumed she was gearing up for an appeal -- and that's now been confirmed. Thomas' lawyer has announced that Thomas has decided to appeal, questioning the constitutionality of the statutory damages awarded, which was the obvious attack point. It will be interesting to see who gets involved in actually managing the appeal.

Filed Under: appeal, constitution, copyright, jammie thomas, statutory damages
Companies: riaa

French Constitutional Council Guts 'Three Strikes' As Unconstitutional

from the sorry-Sarkozy dept

Well, that didn't last long at all... After some back and forth (and tremendous pressure from French President -- and known copyright infringer -- Nicolas Sarkozy), France passed a three strikes law that would kick people off the internet for three accusations of unauthorized file sharing. However, it looks like the law may be going nowhere fast. France's Constitutional Council has gutted the law, after finding significant constitutional problems with it. The Council specifically barred the heart of the law: the cutting people off the internet part, noting:

communication and liberty of expression are fundamental rights that only a judge can rule on.

Indeed. The council said that it could be okay to cut off internet users... but only with a judge's permission. It's expected that the law may be adjusted to push these issues in front of a judge -- but that's a much better (though still not perfect) situation, since a judge should at least require evidence rather than simple accusations. Either way, it's yet another defeat for an industry that continues to insist that somehow kicking people offline is going to "save" the industry.

Filed Under: constitution, france, graduated response, nicolas sarkozy, three strikes

Is A Conviction Constitutional If It's Based On Evidence From An Unconstitutional Search?

from the buttle-or-tuttle? dept

In a case where the legal implications should thrill any fans of Terry Gilliam's movie classic Brazil, the Supreme Court is set to examine if it's constitutional to convict someone, based on evidence that was only collected due to bad data in a government database. There's no question that a search of someone due to bad data in a database is unconstitutional, but the question is whether or not what's found in that search can then be used to charge someone. In this case, a bad (obsolete) database entry in a county database resulted in the search of an individual's car, where drugs and a firearm were found. This resulted in a conviction and jail time, but the search itself wasn't constitutional, because the data was incorrect. The appeals court let the conviction stand, oddly arguing that throwing out the conviction wouldn't put much pressure on governments to keep their data clean. The court also argues that anyone convicted as a result of such bad data, should simply file a separate, civil, lawsuit against the government. Of course, it seems like the bigger issue should simply be on the constitutionality of using any unconstitutionally obtained evidence in a lawsuit.

Filed Under: constitution, convictions, database errors, due process, supreme court

Life, Liberty And The Pursuit Of More Patents?

from the patent-apps-not-innovation dept

At the Republican Convention, Matt Yglesias catches a funny picture of an AT&T poster touting the company's enthusiasm for the patent system. It reads: "life, liberty, and the pursuit of more patents. AT&T: Averaging 2 patent applications per day. Proudly connecting political supporters in Minneapolis."

Photo by Matt Yglesias at Minneapolis-St. Paul Airport.
It's interesting that AT&T is bragging about its pursuit of "more patents" rather than, say, more R&D spending or more innovation. AT&T isn't exactly known for its record of high-tech innovation, so it's a little surprising to see it hold itself out as a poster child for the patent system—particularly when we remember that AT&T and other telco incumbents have used the patent system to extort tens of millions of dollars from companies like Vonage that are actually innovating.

Filed Under: constitution, innovation, patents, rnc
Companies: at&t

Is The Copyright Royalty Board Unconstitutional?

from the this-sounds-familiar... dept

Last month, we wrote about a Constitutional challenge to the patent appeals board. It was based on the theory that the Constitution clearly says that certain appointments can only be made by the President, the courts or the heads of a department. A legal change a few years back let the USPTO director appoint judges to the patent appeals board -- but the Patent Office director is not the head of a department. He reports to the Commerce Secretary who should be nominating the judges -- thus suggesting that all of the appointments over the last few years have been unconstitutional.

Of course, it didn't take long for folks to recognize that the same question may apply well beyond the patent appeals board. In fact, there's a court case challenging whether the current Copyright Royalty Board is constitutional as well. While the article doesn't go into details, it sounds like it's an identical issue. The CRB members are appointed by the Librarian of Congress rather than the President or the head of a department. This particular lawsuit has been filed by an organization that was hoping to compete with SoundExchange for collecting and distributing royalties. The CRB rejected the request. Given how many problems SoundExchange has had in carrying out its charter, it would seem like competition is a pretty good idea. However, rather than fighting that decision specifically, the company recognizes this same constitutional question. Funny how the boards involved in both copyrights and patents may be unconstitutional for the same basic reason.

Filed Under: appointments, constitution, copyright royalty board, copyrights
Companies: soundexchange

Funny How Universal Music Thinks Infringement Fines Are Unconstitutional When It's On The Receiving End

from the and-how-does-that-work? dept

You may recall Bridgeport Music as a company that claims to own the rights to various musical compositions and has a long history of suing anyone who samples even the tiniest bits of that music. The worst part is that there are very serious questions concerning whether or not it really has the rights to much of the music it claims to control. George Clinton, for example, claims that Bridgeport used forged signatures to get control over his catalog. A recent Bridgeport case may be interesting for a different reason, though -- one that shows how the record labels have no problem contradicting themselves when on the receiving end of a copyright infringement lawsuit.

The lawsuit involved Univeral Music, who lost the original decision and was hit with a rather large fine. Universal Music appealed that decision on a variety of points -- and appears to have convinced the judge that the punitive damages tacked onto the copyright infringement claims were unconstitutional. This is quite interesting because, as Ray Beckerman notes in that link, Universal Music is involved in a bunch of lawsuits where it's pushing for extremely high fines for individuals found guilty of infringement. In fact, Universal Music is actually on the receiving end of a lawsuit that accuses the company of requesting unconstitutionally high fines. In that case, Universal Music is asking for fines that are more than 1,000x the actual damages. Pretty high, right? So what were the damages that Universal Music (and the court) found so unconstitutionally high in this case from Bridgeport? Turns out they were about 10x the actual damages. Funny how that works.

It seems like Universal Music may come to regret pointing out the variety of reasons (pdf) why punitive damages can be seen as unconstitutional, as one would imagine that UMG's own filing will be raised against it in its own copyright infringement suits:

"While the Supreme Court has declined to adopt concrete or bright-line constitutional limits for the ratio between actual or potential harm and a punitive-damage award, the Court nonetheless observed that, "in practice, few awards exceeding a singled-digit ratio between punitive and compensatory damages, to a significant degree, will satisfy due process."... The court cited a 4-to-1 ratio as being close to the line of unconstitutional impropriety."

Universal Music would likely claim in its own defense that it was complaining about punitive damages, and in the other lawsuits it's fighting for statutory damages, but there are already plenty of folks pointing out that there really isn't much of a difference in many cases.

Filed Under: constitution, copyright, damages, infringement, punitive damages, statutory damages
Companies: bridgeport, universal music

Are The Last Eight Years Of Patent Board Appeals About To Be Tossed Out?

from the that-would-be-a-big-one dept

A little known lawsuit that has received very little attention could have a massive impact on our patent system. It turns out that, thanks to a procedural change in the law in March of 2000, nearly 2/3 of the appointments to the patent appeals board may have been unconstitutional. This could, potentially, invalidate any ruling involving one of those "unconstitutional" judges over the past eight years. Since the rulings involve panels of 3 such judges, an awful lot of the appeals will have involved one of the now questionably appointed judges. The details are very much inside baseball, but the quick summary is that the law was changed allowing the director of the Patent Office to appoint these judges, rather than the Secretary of Commerce. Yet, the Appointments Clause of the Constitution says that such appointments may only be made by the President, the courts or the heads of a department. The director of the USPTO is not considered a head of a department, as it's a part of the Commerce department (so appointments would need to come from the Secretary of Commerce to be Constitutional).

While the issue was first raised by a well-regarded scholar last year, the argument is now being put to the test in court by a company that felt the Board ruled incorrectly on one of its patents, and raised that issue as a part of an appeal. The Patent Office and the Justice Department are claiming that the company can't raise this issue now because it had not been used earlier (an appeal is supposed to be on the same issues raised earlier). Even if that's the case, then you can bet some other company will eventually raise this issue as well -- so the courts are going to need to deal with it sooner or later. Given the ramifications of a ruling saying that such appointments were unconstitutional (potentially invalidating an awfully large number of rulings), it would be surprising if the courts actually went that way. While it is reasonable to question why the head of the USPTO should be allowed to appoint these judges (there's a potential conflict of interest), pulling eight years of rulings into question would present a legal nightmare over what, honestly, seems like a minor procedural issue. There are plenty of problems with the patent system, but I'd rather they not be dealt with using minor procedural "gotchas."

Filed Under: constitution, patent appeals board, patents
Companies: uspto

The Constitution Still Doesn't Let States Stop Kids From Buying Video Games

from the for-those-who-weren't-paying-attention-the-first-dozen-times dept

Again? State after state after state has passed laws that ban the sale of certain video games to children, and time after time after time those laws are struck down as unconstitutional. Not a single one has passed muster, and yet court time and taxpayer money is wasted over and over again on these same issues, with at least 10 states having gone through the same process with the same results. States cannot ban the sale of video games to children. It's a violation of the First Amendment. This does not mean that stores themselves can't make such a policy, just as movie theaters have voluntarily (not based on a law) agreed not to let kids see movies of certain ratings. But to pass a law is unconstitutional. A lower court in Minnesota made that clear in 2006 -- but it didn't stop the politicians from appealing... and losing. Yes, a federal appeals court has agreed with the lower court that banning the sale of video games is not constitutional. While the lower court had noted:

"There is a paucity of evidence linking the availability of video games with any harm to Minnesota's children at all.... It is impossible to determine from the data presented whether violent video games cause violence, or whether violent individuals are attracted to violent video games."

The appeals court was a little less direct:

"Whatever our intuitive (dare we say commonsense) feelings regarding the effect of violent video games, precedent requires undeniable proof that such violence causes psychological dysfunction...."

Despite claims to the contrary by some activists, there still is no evidence linking violent video games to violent behavior. In fact, as has been pointed out repeatedly, violent crime has continued to drop as violent video games have become more and more popular. At most, studies have shown that violent video games make people emotional, but that doesn't lead to increased violent activity outside of the game itself. Of course, that won't stop grandstand politicians from pushing for such violent video game bans, despite the knowledge that they're clearly wasting taxpayer money every time they do so.

Filed Under: constitution, first amendment, minnesota, video games, violent video games

Judges Rejects Gambling Group's Attempt To Toss Out Anti-Online Gambling Law

from the keep-trying dept

A group calling itself the Interactive Media Entertainment & Gaming Association has failed in its attempt to get a judge to throw out Congress' law designed to ban online gambling. While the judge did note that the group has standing to bring this suit (which was an open question), she did not find their case compelling at all. She basically said that Congress passed the law legally and it wasn't a violation of the Constitution. The group is planning to appeal, but it still seems like a more likely path towards getting such a law overturned is to convince Congress that it made a mistake.

Filed Under: congress, constitution, legality, online gambling