Secondary Fair Use
Analyzing disruptive technologies on which secondary liability might or might not be imposed. Sony standard: why so low as “capable of substantial noninfringing use”; from copyright owner’s perspective, this is really harmful. Why is the traditional standard either control & profit (vicarious) or knowledge & contribution (contributory) but not all at once, or some other subset? A good standard would provide a balance between authors’ and inventors’ incentives.
He models one author, one inventor, investing in creation. The inventor’s creation competes with the value of the author’s. They see what their products are worth and then transact. Three possibilities: both should operate; only the technologist should operate; only the author should operate. Can create a matrix showing the payoffs under various rules.
When a technologist has a property right, its incentive to invest in harm reduction turns out to be negative—creating harm to others creates an opportunity to profit. This is what inducement theory prevents. Explains Grokster in light of Sony. Sony’s tech has substantial noninfringing use and creates more value than harm; though Grokster’s tech is capable of substantial noninfringing use, it creates more harm than value.
We can change the rules of liability according to the realized values of tech and works of authorship. It’s relatively easy to decide when only one party should have the right/should be acting, but the difficulty comes when we want both the technologist and the author to operate. If you look at realized values ex post, it becomes clear that protecting the author with a property right is not the best solution, whereas there are choices to be made between author’s liability rule, technologist’s property right, and technologist’s liability rule. Oliar rejects author’s liability rule because it can’t be implemented in a regime with statutory damages. Likewise, he rejects technologist’s liability rule because it is so difficult to figure out. He thinks a property rule in favor of the technologist, which he identifies with Sony, is the right result, as modified by inducement/Grokster.
He thinks this analysis applies to fair use more generally, not just technology companies.
Q: How are we supposed to have any sense of what these values are, or what they might be a year from now?
A: It’s not perfect, but valuation is what people do. The value of tech isn’t just in any particular work—it can have value with respect to works in the public domain, or works where the author doesn’t object to the new use.
Q: What does it mean to suggest that there are scenarios in which only the author should operate? It’s not like the author harms the technologist unless the author already has a property right.
A: It’s just an externality—no one is to blame for a reduction in value, but if they act together the net result is less than the sum. (This must, I think, be assuming that the tech still had value even if it didn’t carry/affect any protected works, perhaps because of works in the public domain/fair use/etc.)
Frank Pasquale, Seton Hall University School of Law
Beyond Competition and Innovation: The Need for Qualified Transparency in Internet Intermediaries
The problem of unaccountable intermediaries: the new panopticon. They set the terms—you can’t negotiate with your cell provider on any of the information-based terms. Hidden persuader problem: you don’t know how you’re being sold. Relatedly, network power brokers: access to the network to the highest bidder.
Even if you value competition and innovation, that’s not enough. Often the competition is to gather information about people, and the innovation is to collect data and manipulate people in new ways. Privacy is an irreducible social good, and search and access are credence goods—faith in them needs protection. Monitoring is a foundation for accountability—look at Comcast’s throttling of Bittorrent. And that was hard to discover—it was one guy, an out of work engineer, who spent six weeks trying to figure out what was happening to his connection. Rather than relying on distributed enforcement, we need to mandate accountability.
The big picture: net neutrality battles focus on the physical later, but there are other threats to openness, innovation, and other valuable and worthy social goods at other layers. Zittrain on the iPod, Tivo, etc.; operating systems; intermediaries like search engines and social networks. Big question: why won’t litigation or competition work? He responds: network power. And intermediaries can compete to invade privacy. As for litigation: courts just find it very difficult to understand the big picture. Viacom v. YouTube—huge discovery battle, and Viacom didn’t end up getting very much information about how YouTube’s filtering worked. We may distrust big content owners, but this portends any litigant’s difficulty finding out how a search engine works based on trade secrecy claims. And litigation only occurs if people figure out that something untoward is going on—with personalized search results, you may never know what comes up when other people search for your name.
Regulation in the form of monitoring is the only way to balance intermediary power—need someone capable of making factual findings. Weitzner on “extreme factfinding”—a body of people capable of understanding what’s going on with the intermediaries at any given time. Someone needs to be able to “look under the hood.” FISA court model: a centralized government body, even if the facts are kept secret from the world at large.
Sandeen: So you want to control the trade secret problem by limiting knowledge to the regulatory agency?
A: Yes. Litigants often have trouble getting access, especially if all they have is a conclusion that they’ve been unfairly treated—defendants will respond by claiming neutrality for their algorithms.
Sandeen: Data exclusivity movement, where pharmacos are claiming a right to protect non trade secret information based on language in TRIPS. Used to prevent transparency in clinical trial data. Good analogy, possibly.
Jessica Silbey, Suffolk University Law School
Comparative Tales of Origins and Access: A New Future for Intellectual Property
The access movements: pushing against traditional IP. Increasingly polarized pro and anti property discourses. What accounts for this polarization, and is it as entrenched as the rhetoric suggests? Are the access movement’s stories that different from traditional IP stories? What kind of communities are being constituted?
IP: origins rhetoric; access: anti-origins. Traditional IP law: private appropriation is a precondition for production. Access: private appropriation may not be necessary for this—the new socialism of open source/the internet. Karl Marx said that common property is the common form. James Grimmelman on the ethical visions of copyright, all huddling around a default where authors and users are in a reciprocal relationship with payment as central. Sharing can support or undermine this central relationship.
Common ground/common problem: Both traditional and new stories are grounded in notions of autonomy and idealized notions of consent. This may portend failure for the access movements, or maybe they’re just rehearsing the origin myths of traditional IP.
Traditional IP concepts: the first and true inventor; works that are recognizably the author’s own; authenticity and source designations; valuing being there in the beginning. It’s a privilege and a status—lineage justifies high status. Heroes are independent and resourceful people, rugged American individuals. (Also European, right? Moral rights come from Europe.) Essentialize beginnings: being there first equates to desert. Justifies the status quo and explains it. Not backwards-looking but forward-looking: today’s characteristics that are valued are the same ones of self-reliance and self-control. Also adds in idealized, implied consent: we must have consented to those beginnings through a constitution, a marriage contract, an employment relationship, or the like.
What stories are the access movements telling? Robust commons, breakdown in the public/private distinction, mutual dependence on the commons that connects individuals. Thus, shared ownership/sharing nicely—equality between people. The community is the source (not really the origin) of creativity; value lies in the ability to give back to the community, and sustainability is key. Beginnings are less important—it’s going on that matters. Sharing not selling, collaboration not isolation promote the progress of science and the useful arts. Challenge us to figure out why people work and innovate, and tout nonlinear/group productivity as the best way to get innovation. Creativity is equated with play. The traditional rights bearing individual is contrasted to other-regarding ownership, valuing taking care of others as a way to make everyone better off.
Maybe this does flatten the hierarchies of traditional IP, and promotes an antisubordination rationale. And it talks more about substantive equality. Culturally fulfilling lives are valued as much as or more than overall efficiency. Focus is not on beginnings of products—open source software, blogs, wikis, remixes—but on how they get spun forward in the future. (I’m reminded of Eric Goldman’s doubts about the sustainability of Wikipedia.) What’s important is tolerating differences in what people want and differences in what they contribute. This is 21st century collaborative science fiction overlaid with 20th century liberal civil rights discourse.
If the origin stories try to protect the status quo, the access stories try to undo it, but she’s not sure they can succeed. Consider access movement heroes: they share conspicuous characteristics with standard stories: the hackers, the independent investigators—rugged individuals who allegedly are free, autonomous, creative. Access movement speak of freedom from and freedom to, but those are different things and they have contradictions that aren’t always addressed. Maybe we should be talking about autonomy in different ways—“freedom” is a problematic concept.
What measure of consent is meaningful? Open source = layering a contract on top of a private good. Meaningful consent to a license is really a metaphor, so why do we insist on licensing? Because our ideal of autonomy/consent drives us to ignore the reality of interactions with licenses.
How much of the new future will be old, if the access movement preserves the basic default rules?
Josh Sarnoff: One area of difference is at the level of substantive human rights. Limitations/exceptions for education. The political dynamic: how does someone get constructed into an autonomous person?
Me: Vidders strike me as a community grounded in community production, creating works that depend on context for intelligibility and engage in dialogue with other works, though it’s true that people occasionally nominate an “artist” or individual auteur out of the group, and of course vidders have a strong sense of their own individual artistic commitments. In the pending DMCA rulemaking, we had an artist talk about her individual creativity to justify an exemption for remix. (And also, Silbey’s point about the “heroes” of access movements is part of the dynamic that has kept vidders and similar communities marginalized in much of the discussion as compared to individual (male) protesters.)
A: Yes, as an advocate you have to make strategic choices about good arguments for your client. But you also have to worry that choices you make now will limit your ability to get broader results in the long run. The challenge: stop talking about autonomy and freedom in a world in which those concepts are meaningless given the constraints in the background.
Molly Land: Note that the human rights discourse also has its own language of individualism—created a worry that bringing human rights into IP would strengthen the discourse of IP maximalism because of these commitments to the individual. But human rights may be a more useful concept than access. Access can be about knocking down barriers, not about creating capacities, and human rights can add in emphasis on positive development of capacity.
Irene Calboli
The Case for Trademark Merchandising
She wants to look at TM reality v. theory; merchandising exists in practice, and she wants to protect/justify it to a fair and limited extent.
TM merchandising is a type of promotional licensing: use of marks on unrelated products, authorized usually by contract. It can be for profit, or just to establish brand image and advertise the main products. TM owners register marks in multiple categories just to be able to advertise the main products. She doesn’t believe that quality supervision is required as long as there’s a valid contract.
Boston Hockey is the key case here, 1975, allowing promotional use. Job’s Daughter in the 9th Circuit in 1980 rejected merchandising rights claims, but it bucked the trend. Most courts don’t say that TMs are property, but purport to apply the traditional confusion standard. State dilution laws also aid the merchandising right, as does federal dilution.
Merchandising is based on a property-type protection: protection of TM’s attractive function, or of the mark per se, rather than protection of consumers or protection of origin. Tough cases: when TM owners don’t have registrations for certain products and someone else uses them: unauthorized Redskins cookies sold at my local bake shop. Also, when consumers know they’re not purchasing an authorized product. On the other side, TM merchandising is an accepted practice by companies as a royalty producer/image builder and increasingly by consumers/fans. Practitioners and the PTO/TTAB accept it too in registration and opposition. Practitioners advise clients to register marks in multiple classes, even without use in countries where that is ok, and license it later.
Is this a monopoly? A barrier to entry? What is the good at issue: the patch/mark or the T-shirt with the patch/mark?
Pros of protection: protecting TM reputation and profitability; obliges competitors to work around and create their own products rather than riding on someone else’s reputation (a copyright justification?); prevents blurring/tarnishment (creating problem of self-dilution? Licensees produce cheap goods in China, etc.).
Cons: consumers deprived of cheaper products; competition can suffer; market failures; negotiating licenses can be costly and time-consuming.
Her proposal: protect against identical copies, i.e., fake products. Enforce licensing protection when agreements are valid via traditional infringement and dilution tests. Apply the traditional dilution standard when there’s no TM registration/license/use with respect to the products in question: SETON HALL unauthorized bagels. Problem for her: how to deal with abandonment/acquiescence/laches arguments.
My comment: I’m particularly interested in the workaround justification because it highlights merchandising claims by TM owners against merchandisers who have created variants—“Game Day” ads challenged by the Superbowl, fan T-shirts that don’t use the core mark but use associated colors, images, etc. (Note also the interaction with TM owners’ habit of claiming multiple protections—mark, trade dress, slogan, etc.)
A: She’d still apply a confusion/dilution test, but does think that such products do add to the universe of goods and may be beneficial. Courts would have to sort this out.
Zahr Stauffer: There may be comment/criticism even in a fake—still expressing a claim about the brand and its value.
A: But it’s also a criminal offense. Not necessarily clear that people will know it’s a fake just from context.
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