Thursday, December 12, 2013

PTO/NTIA: remix

Legal Framework for Remixes

Moderator: Michael Shapiro, Senior Counsel for Copyright, USPTO


David Carson, International Federation of the Phonographic Industry

Popular image of industry that forcefully asserts rights and goes to court at drop of hat is not the reality today, after baptism of fire with online pirates decimating sales. We’ve remade ourselves and focused on rights to license so consumers can experience them in just about any way they want, ideally in ways that make us money because we are a business. We aren’t out to sue people. Days of suing users are behind us.  We’re trying to give people ability to do what they want in a way that doesn’t harm our rights and compensates our artists when they use our creative efforts.

Generally, we are licensing UGC. YouTube licenses are exemplary: permit YT to make UGC with sound recordings available.  Google called the licensing solution, powered by Content ID, as win-win-win for copyright owners, YT, and users: new source of revenue for the first two and allows the users to remix without independently seeking licenses. 

Commercial sound recording remixes, by contrast, should be a negotiation with rights clearances and payments.

Prof. Peter DiCola, Northwestern University Law School

Book, Creative License, with Kembrew Mcleod.  Based on over 100 interviews with musicians who’ve been sampled and who sample; attorneys, industry professionals, and scholars. Many competing interests in sampling. Detail sample clearance process. Some great successes (Suzanne Vega and DNA, with initially unauthorized remix) but there are significant barriers, especially for independent labels and musicians. Inefficiencies: transaction costs; difficulty of negotiating across generations; royalty stacking problems. Even advocates of status quo agree: if you sample multiple works, it will be impossible to license your work for any price less than 100%.  Collage based music with 15-20 samples is impossible, everyone agrees. Some are untroubled by this, but the fact is that even superlawyers can’t get it done.

Jay Rosenthal, National Music Publishers’ Association

Has negotiated 100s of digital sampling deals in prior life, represented Salt N’ Pepa etc.  We support fair use exceptions as legitimate defenses, but don’t believe that fair use should be expanded beyond accepted contours or believe in compulsory licensing because of the various ways in which samples are used. Copyright law shouldn’t have primary goal of ease; should be supporting interests of creators. Shouldn’t promote class warfare between old artists and new artists. Congress should incentivize collaboration, including licensing.  Doesn’t believe there’s a problem with digital sampling. After 20 years, contractual deal points are relatively easy to negotiate. Businesses exist to help get clearance, get quotes, for new artists too. Easier than ever to find authorship/ownership information.  You can find publisher/songwriter if you really want. Cost of samples has never been lower; buyer’s market. Often not flat fees, but sharing percentage. If you have lots of samples, it’s hard, but it is done—idea that it’s undoable is untrue.

Takes exception to the idea that Public Enemy’s views on digital sampling are majority in hip-hop. Other rappers like Salt N’ Pepa concluded that unauthorized sampling is morally wrong/violates Golden Rule.  Would clear all samples.  “What a Man” had 60/40 basis.

No compelling reason to change broad framework with de minimis/copyrightability test. That’s the antithesis of progress to have loopholes in copyright law to allow remixers to use other artists’ music for free. But there are solutions. Market-based.  NMPA’s deal with YouTube over UGC, thousands of publishers.  UGC is a big part of this debate; is being put into a paid position.  Creative Commons approach is also viable.  Microlicensing is also a solution for less use/less money.  Much better for ecosystem to promote collaboration between new and older artists rather than them not asking permission, not paying, and not attributing. (I wonder what the Impressionists would have said about collaborating with the older generation.)

Josh Schiller, Boies, Schiller & Flexner LLP

Represented Richard Prince in court of appeals (i.e., that district court ruling was Not My Fault). Appropriation art as a recognized artform. Used photos as raw ingredients; you could call them samples; he’s called himself a kind of DJ.  Court found most of them transformative; believe the remainder will be so recognized too.

Importance of 2d Circuit’s decision: recognized that a work of art can be transformative without needing to look solely at an explanation the artist may provide. The concern for “legitimate” fair uses—there’s no such word in the statute. It lists a number of examples.  You have to look at each work for transformativeness.  Even using the entire image, when you’re dealing with art, can be fair.  Prince is inspired by many things; he shouldn’t be required to say magic words to get a transformativeness ruling.  Satire/parody need not be obvious.

The issue is not lack of clarity, but that fair use is case by case and copyright applies to so many industries that fair use must be considered within its context.

Prof. Rebecca Tushnet, Organization for Transformative Works

501(c)(3) nonprofit founded to protect and defend noncommercial transformative works and their creators.  Scope: 42 million hits on our website each week by people accessing fanworks, and we aren’t anywhere near the largest site for fanworks.  Creative works exist in an ecosystem, and in that ecosystem, noncommercial works are the equivalent of the wetlands—a rich source of diversity that can’t be replaced by systems of top-down control.  In this environment, fair use has an important disciplinary effect on the biggest copyright owners whose works are most often used in remix. It deters them from making the most outrageous claims and allows people who are caught up in automated enforcement mechanisms to assert their rights. If they find an organization like ours, fair use allows creators to fight back when copyright owners try to suppress critical and transformative uses like Jonathan McIntosh’s Buffy vs. Edward. Robust fair use supports a culture of free speech and reasonable balance as against a culture of suppression of speech and the resulting disrespect for copyright.

Licensing is no substitute for fair use, as fair use decisions from across the courts of appeal have recognized. Fair use exists to protect works that copyright owners wouldn’t license, as we’ve seen again and again with the licensing schemes offered as exemplars—both on YouTube and Amazon’s Kindle Worlds there are substantial content restrictions that fall most heavily on the most critical and most transformative uses. Fair use also exists to protect works that simply shouldn’t be controlled by copyright owners because of the substantial new meaning and positive externalities they bring into the world—positive externalities being the term for value that isn’t captured by the creators themselves in terms of monetary return and thus can’t simply be transferred over to existing copyright owners. In a licensing-only world that value would be misdirected and destroyed. Licensing schemes also support monopolization of the channels of communication, since only giants like Amazon and Google have the clout to negotiate broad licenses and use that to keep people locked into their platforms against the competition.

A final note, given the composition of this panel: under most circumstances, music isn’t a good model for the rest of copyright. The legal regime and the business models it has encouraged are so complex and specific that we should most likely look elsewhere, unless we’re prepared to adopt compulsory licensing across the board. And I think Mr. Schiller’s comments also bore this out.

Q: what is a remix?  Collective works/derivative works/compilations?  Jay Rosenthal distinguished between remix and mashups.

Rosenthal: from a music standpoint, a song that is basically a recreation that would come under the compulsory license is one type of derivative work, allowed by statute.  Beyond that, a song with samples v. a mashup with lots of samples are effectively the same thing from a legal standpoint. Is it harder for Girl Talk to license, if he tried? Yes. But nevertheless fundamentally the same. Might be different for other forms of art.

Q: do we have a cultural production problem?  If it’s uncertainty, where’s the evidence?

RT: lightning strike effects of getting a takedown notice, which often leads the person to withdraw completely; fear at the institutional level so that schools are unwilling to use remix even though it’s really good for teaching.

DiCola: trouble with move to commercial world; also inhibits licensing to push them underground.  Lost revenue is a shame too.

Carson: music industry shares that goal.  Instinct is to cut a deal, or do it on an automated basis.  There are always exceptions—recording artists who don’t want their work sampled.  Or a record company might want nothing to do with a particular product.  What if Nazis put a work on their website?  One of our poster children for European gov’ts about necessity of controlling uses is offensive uses made of our works is the brief YT phenomenon (we do take down) of Hitler’s In Memoriam to Adolph Hitler, using popular sound recordings such as theme from Titanic. We want to stop that.  So sometimes licenses won’t work.

Rosenthal: moral rights. Our YT deal resulted from class action on behalf of independent publishers. Have ongoing license with cooperation and collaboration, working on database. Idea is not to sue out of business or stop them from making fair use/derivative works—we want licenses.

Creativity: lived through the age of hip hop. No producer reaching out through a company, when they clear a sample or get a “no”—never known a producer to stop work and go home. Go on to the next one.

DiCola: doesn’t disagree about substitution being possible, but let’s talk about the places where there are barriers to understanding the system. There’s no example of someone with 20 samples getting a license. That kind of work can’t be licensed.

Rosenthal: I’ve done them on prorated basis.  Shouldn’t compel us to change a whole licensing system.

RT: noncommercial speech works differently; 16 year olds inventing remix in their bedrooms don’t take these business routes; diversity/chilling effects are disproportionate for women/minorities.  Types of creativity differ: example of Gone With the Wind, where they were perfectly willing to license certain types of content but not Alice Randall’s depictions of homosexuality and miscegenation.    Like saying that there are newspapers under a censorship regime and the fact that they’re filled indicates that free speech has been unaffected by censorship.

Q: fair use changes in the courts?

Schiller: court recognized that observers matter. There are readily available artistic opinions that speak both to transformativeness and to market substitution.  Commerciality doesn’t mean market substitution.

Q: statutory license/Canada’s UCG exception?

RT: Look at it!  Canada’s market seems to be functioning well; SOCAN even just cut a deal with YouTube. Protects against the lightning strike.

Rosenthal: sometimes it’s tough to understand what’s noncommercial. Many clients early in their careers are trying to turn themselves into viable marketplace forces, but aren’t making money. Brings intent to the fore, and whether user is trying to get into a commercial marketplace v. hobby/fun.  On fair use: Beastie Boys case is very worth following.

DiCola: an issue of control.  YouTube license is worth paying attention to but the advantage of a statutory scheme is that it’s public and transparent, and Content ID isn’t.  (Preach!)  When a YT clip has more than one work, how does the revenue get split?  The parties might know, but we don’t. Public scheme has benefits of understanding (and also, I would add, the benefit of allowing competitors to get the same deal).

Carson: statutory licenses have a lot of baggage. Many licensors and licensees aren’t particularly pleased with them.  Will always be cases where you want to say “no, you can’t use my work for that purpose,” and a statutory license doesn’t permit that.

Peter Menell: mashups are astoundingly popular, outside any real market. Disservice to copyright if we can’t bring it within a market of some source. Rosenthal hasn’t convinced me. Generation of remixers won’t just shift from one source to another if they get told “no, you can’t use X, find a Y instead.” You’re encouraging them to hate and defy copyright law. Mechanical license worked pretty well. Could be way to go.

RT’s reaction: this is a way to “hide the wiring” of copyright for ordinary people.

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