Contractual covenant: an exchange of copyright rights for some promised performance. Generally, not preempted by Copyright Act. Remedies: contract. One exception: automatic revocation/recission clauses: you can get copyright remedies for breach.
Conditions precedent: found by the Federal Circuit in a recent case on open source licenses. A conditional promise: you can use the work provided that you do this thing; failure means copyright rights don’t vest and you’re an infringer when you fail to satisfy the condition. Conditions precedent are usually disfavored in contract law, but if they’re explicit enough they will be honored. Failure to pay royalties is usually a breach of a covenant, but courts often say that they could be structured to be conditions precedent. Federal Circuit approved strategy of binding downstream uses by forcing the contract to travel with copies of the work.
Is there any limit on what copyright owners can get copyright remedies for?
In general, copyright policy would be a useful guide. Many courts have praised attribution, which as part of contracts can be contrasted to bans on fair use.
Contracts plus TPM provide a huge amount of flexibility for copyright owners who are paying attention; he is looking for some constraints. Conflict preemption is his leading candidate, but courts like to talk about preemption more than they like to apply it.
Ned Snow, Burdens of Fair Use
Who should bear the burden of proof in a fair use claim? Fair use is currently understood as an affirmative defense, burden on the defendant (with a small qualification perhaps in Campbell). It doesn’t have to be: §107 defines fair use as “not an infringement,” which suggests that the party asserting infringement ought to have to disprove fair use, and Congress expressly called it a “right” in §108. One sentence in the 1966 House Report has led courts to conclude that Congress structured fair use as an affirmative defense: “the Committee believes that any special statutory provision placing the burden of proving fair use on one side or another would be unfair and undesirable.” Obviously, this sentence doesn’t do what the courts say it does. It doesn’t make sense to say there should be no burden of proof; Congress here is at most punting to the courts. The Supreme Court fumbled by not deciding, just tossing off a line.
Going back to precedent, if fair use grew out of Folsom v. Marsh, then it was bound up in the initial question of infringement, which again suggests a definitional question making lack of fair use part of the plaintiff’s burden. There also appears to have been a misunderstanding of the term “privilege,” with modern courts treating the fair use “privilege” used in older cases as analogous to a privilege in real property, which is an affirmative defense.
The burden of proof increases copyright’s chilling effect on fair uses. If Eldred is right that fair use is important for First Amendment concerns, this mandates at least a shift in the burden of proof, as Joe Liu has argued, drawing on defamation law. The party suppressing the speech must show that the speech is not protected, which has a bias towards broadening the marketplace of ideas.
First, let’s make lack of fair use definitional for infringement; the copyright holder has the burden to prove the facts that fair use isn’t present. Aside from free speech, the copyright holder has best access to relevant facts, particularly facts about markets. He thinks courts can manage the burden on the plaintiff; but if that’s too much, he proposes to split the burden, putting a burden of production on the defendant to show it’s in the grey area, and then the copyright owner would have the burden of persuasion. We do that already in first sale: if the defendant raises a scintilla of evidence that first sale applies, the burden shifts to the plaintiff.
Burden splitting would make sense out of Campbell, which spoke of 2 Live Crew’s failure to produce evidence on market harm, but then suggested that 2 Live Crew’s nonverbatim copying seemed likely to be fair use. All 2 Live Crew should need to do is show evidence on one fair use factor, and then the burden of persuasion should shift.
Julie Cromer Young, From the Mouths of Babes: Protecting Infant Authors from Themselves
Minors are entering into lots of contracts, e.g. online. Their agreements may be voidable. If all agreements with minors, doesn’t this diminish their copyright interest? Perhaps there is an implied license running to the parents. But does that square with children’s rights as authors?
The licenses on Facebook, MySpace, Disney’s Club Penguin, etc. are really extreme, granting perpetual, royalty-free, nonexclusive licenses to do anything with user-supplied content, even though millions of the submissions come from minors.
Doctrine: contracts are voidable at the minor’s will once they attain majority, if they act within a reasonable time. The question: do we care that this should apply? There’s been a movement for the doctrine not to apply.
What do you do when the child is a bad actor? That creates pushback against the doctrine. Why not say that a child who is capable of entering into a contract should have to abide by it?
The turnitin.com case: turnitin.com demanded that students agree to the license allowing archiving as part of submitting papers for plagiarism detection, and their schools required them to use turnitin. The court refused to allow disaffirmation. They received the benefit of a grade from using the service, and also they received the benefit of standing. She thinks this is nuts. Williston: the child can’t disaffirm when he’s received a benefit, but only if the benefit is one that he can return. (Right, what I don’t get is that the alleged infringement is ongoing, so the past benefit can’t count or all contracts that aren’t essentially slavery will be outside the scope of the rule allowing minors to disaffirm.)
Other implications: how we view the service of distributing content—is it a benefit? Does a benefit received from a third party count? If we don’t want to reward bad child actors, we need to find a reason that focuses on their badness rather than what the court in the Turnitin case did.
Goldman, for Young: Even if there was permission for copyright, that wouldn’t allow recycling for marketing—there are privacy and publicity rights available. If the contracts fail with minors, then wouldn’t they also fail for other purposes, like disclaimer of warranty, making Facebook subject to warranty obligations, or arbitration provisions, etc.? This is why there’s pressure to find these contracts valid. (I agree, but that just means that contracts with kids are now more common than they used to be; maybe that’s something Facebook has to live with. Also the “received a benefit” distinction may make some of the non-copyright issues different, if all the alleged harm happened pre-majority.) COPPA says you must disclose privacy policies to those 12 and under. What about kids 13 and up? The law contemplates bad privacy policies for those kids, so in another sphere we’ve changed definitions of who needs protection.
Goldman, for Snow: 9th Circuit’s Perfect 10 v. Amazon did some fancy footwork with preliminary injunction standards flipping the burden of proof, then amended the opinion to erase that result.
Karl: Look at child actor laws—it might be that they cover transfer of IP. Companies haven’t really tried to use these stupid provisions in their contracts. Maybe they’re useless legally too. Or perhaps you could argue for an extension of these laws for this situation (though that might run into preemption problems).
Karl, for Snow: Title VII burden-shifting seems like exactly the right analogy. She’d like to see fair use in declaratory judgment actions—what happens then? Look also at notice and takedown, and the recent decision in Lenz. There’s also possibly relevant precedent in damages and profits caselaw in infringement.
Q for Snow: Same issue arises in Australia in fair dealing cases. The old English cases are interesting because they treat it more as a limit on the right than an affirmative defense. It only becomes an affirmative defense once codified. Australia would immediately think of Berne’s 3-step test—is there any international issue in shifting the burden of proof? There’s been a big debate about the scope of defenses post-TRIPs.
Lunney, for Snow: Both Sony and Harper & Row put the burden on the plaintiff. (Snow: you can read Sony either way—if noncommercial, burden on plaintiff; if commercial, burden on defendant.) Lunney: at oral argument, 2 Live Crew’s counsel conceded that defendants had the burden of proof, making Campbell dicta. We also talk about plenty of things as affirmative defenses that aren’t: independent creation is called an affirmative defense, but there’s no burden of proof shift because copying is part of the plaintiff’s burden.
Lunney, for Ridder: Consider the doctrine of efficient breach. Sometimes breach is good. Sometimes we might not want to go to copyright remedies because that would limit the opportunity for efficient breach.
Bob Brauneis, for Snow: Burden of proof seems to matter most where evidence is scarce. Only on factor 4 does there tend to be an absence of evidence; it’s easier to know what the type of use is, how much was used, etc. (I’d think that factor 1 transformativeness will also be affected, at the margin, and courts do like to find things marginally transformative.)
Snow: He agrees that a strong counterargument is that burden of proof will rarely matter. But as a legal realist, he thinks a court confronting a new standard would put a finger on the scales in closer cases.
David Levine: Can something as technocratic as a burden of proof solve the chilling effect by shaping perceptions about people engaged in expressive activity. “Fair use as a right” is something that may be easier to internalize, and maybe burden of proof is a road to change that gut-level reaction.
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