Commentator: Felix Wu
The format involves Wu presenting the paper and then briefly
commenting, before Rothman responds.
Wu: commerciality is bound up both in the scope of different
IP rights and various defenses.
Often ends up getting tied into First Amendment commercial
speech doctrine, which is falling out of favor with the Court and commentators,
and is a questionable source of authority for distinguishing commercial from
noncommercial. Commercial and
noncommercial are beginning to merge, so we can think about why and how we
might erase this line in IP. Thinking
through what a post commercial/noncommercial world looks like.
Isn’t commerciality just a proxy in fair use for factor four
substitutability? Noncommercial distribution of hit film is substitutable and
just as harmful as a commercial distribution.
Mp3.com got dinged without thinking about whether the kind of use at
issue there might be nonsubstitution—so it’s problematic on both sides.
Proposed fix: look at other kinds of lines, such as educational purposes
without regard to commerciality.
In TM, similar potential dichotomy. Use in commerce is necessary to acquire TM
rights, commerciality lite; but more interesting, does defendant have to be
engaged in commercial speech in order to bring an infringement action? Case law involves courts talking about
commercial speech doctrine but applying the Lanham Act in all sorts of
instances clearly noncommercial speech for First Amendment purposes, like
movies and video games. (Why does she
think eliminating the commercial/noncommercial distinction would help?)
Rogers defense even suggests
that infringement actions can cover noncommercial speech in certain circumstances. Dilution and false advertising also use the
distinction.
What would the world look like without the
noncommercial/commercial distinction?
Maybe we could address the harms of deception/confusion arising from
noncommercial speech. We could provide
more breathing room for commercial speech.
We could avoid the effort required to identify commercial speech as the
line blurs. We could apply an actual
malice standard in Lanham Act cases or other IP situations; this sort of
standard might be appropriate.
Wu’s comments: (1) Structurally, he wonders whether the
paper might separate out further constitutional and nonconstitutional notions
of commerciality. IP law’s definitions
are often explicitly nonconstitutional, especially copyright, and then there
are other areas where courts purport to refer to the constitutional sense. (2)
Think about whether we care about different kinds of speech/communication,
potentially distinguishing TM and false advertising claims in thinking about
assertions as to identity and other kinds of assertions about facts in the
world. Would we care differently about assertions about identity than other
kinds of facts? (3) Skepticism about
ability to successfully merge political and commercial in this regard; might
not serve either side. We might have
stronger interests in speakers in
political contexts, even in speaking falsehoods, than in a traditional
commercial context. Granting difficulty in distinguishing at the margin, the
endpoints may justifiably be preserved.
Actual malice might underregulate in advertising law; would make it
difficult to prevent commercial falsehoods that we should be preventing. (Wu kindly referenced my work on
the subject.)
Rothman: Main motivation for the project is that she’s
always footnoted these problems and they really need addressing. The right of publicity is a huge issue
here. People constantly say the right is
limited to commercial speech, and that’s just descriptively wrong. Some states
do limit the right to commercial speech, but overall it’s applied more broadly.
Wants to call that bluff.
Notion that commercial speech is more harmful to an identity
holder than noncommercial speech is not necessarily true—Lady Gaga is more
upset by Family Research Council suggesting that she’s against marriage equality
than by Baby Gaga baby food.
The case law is just incoherent: see the 9th
Circuit.
She doesn’t necessarily advocate importing actual malice,
just doesn’t think it would be the end of the world. But we may be seeing the death of commercial
speech as a doctrine, so we need to think about what would happen.
In terms of giving more latitude to noncommercial speakers,
it’s difficult to separate commercial and noncommercial speech.
Betsy Rosenblatt: there’s two kinds of commercial speech. One
uses commercial as the opposite of expressive and one uses commercial as the
opposite of nonprofit. Would like to see more about the difference between
these two—it’s confusing that copyright uses the second definition and TM and
right of publicity give lip service to using the first definition.
Not convinced that commerciality is a standin for
substitution. Many non-IP professors
have an instinct that if someone is making money off of some creation, they
should reward the creator in some way—give back. Might take that into account—the moral
claim/unjust enrichment type claim.
A: these are related concerns. Also an issue of value: even in copyright we
generally assess profit/nonprofit, we also value things made for profit less
than things that are made not for profit.
(I don’t think this reflects the case law.)
Unjust enrichment does affect our intuitions in
copyright. Still working on that.
RT: My concerns: in this model, as an empirical matter, property
wins and public interests do not. No
clearer example than the 9th Circuit—you seem to lean into the bad
results we’re already getting. The whole point of having a non-harm-based
standard, like a rule for noncommercial speech, is that harm stories are
endless, and courts are more convinced by property stories than by fraud
stories.
Justice Stevens’ standard: look at whether the regulation
targets the commercial aspect of the transaction. Solves the problem of
distinguishing marginal cases: look at the regulation and its aims, not at the
speech object.
Paper discusses DMCA hearings: cite more of them; she doesn’t
like the remix exemption for noncommercial works and argues that an exemption
for commercial works would have been a good idea. I believe that too! A blanket exemption was proposed and rejected
largely on the licensing grounds you propose as the substitute test—copyright owners
argued that they wanted to license all these uses, and the Copyright Office
found that this was a good enough reason to deny an exemption. This is why I believe that giving up on
noncommerciality and looking only at harm stories is a very bad idea.
A: my proposition is that IP law is in a mess and that not
acknowledging this issue is a problem. The rest is a thought piece about what
law would look like w/out the commercial/noncommercial distinction. Does not want to rest everything on harm,
though Alvarez says that’s the basis
for restricting noncommercial speech. Because we’ve been so focused on
commerciality, we’ve been undercutting ourselves on other ways to be more
speech protective. Sometimes a focus on
substitution would be better, or transformativeness. (RT: “We” have not neglected these factors, I
don’t think, and the big fair use wins are about commercial uses and haven’t
neglected those factors.) Yes, in the
right of publicity, it might lead to more liability, though she doesn’t like Keller either.
Commercial/noncommercial is still muddled even if there are
clear extremes. (Right, but my point was
that the Stevens approach asks what the gov’t is trying to regulate, the
commercial aspect of a transaction or something else, and strict scrutiny
applies if it’s something else. Then you
don’t need to decide whether an advertorial is “commercial speech,” only
whether there’s a regulation aimed at a transaction.)
Lisa Ramsey: are you trying to describe what would happen
under the Court’s political speech jurisprudence/strict scrutiny? Or are you proposing some other standard?
A: Her point is that it’s a mess. Courts confidently say the Lanham Act applies
to commercial speech, and then that it applies to noncommercial speech. Shining
a light on that is valuable. Then we can
think about what we could do that would work better.
Not just about market harm and incentives to create, but
also other interests, including personality interests—harm to copyright owners
can be unrelated to market harm. One
proposal for copyright reform is to only provide robust protection to
commercial works, but she thinks that’s problematic. Scope shouldn’t be different for
noncommercial works.
Room 204:
Jonathan Barnett, Copyright
Without Creators
Commentator: Jonathan Masur
Masur: Barnett makes the case for intermediaries. Financing major products, producing risky
works (subsidizing losers with winners). There are many other revenue sources
for intermediaries beyond sales of copyrighted works. Yes, Barnett says, but
removing copyright would take away one choice, and so we might not get the best
funding model. But that would justify
infinite copyright as well. Larger point
is that this runs into the issue of balancing static and dynamic
efficiency. Can’t avoid question of how
much is too much given the existence of other distribution/funding models
beside copyright.
Smaller issue: what’s the line between authorial incentive
and intermediary incentive? Costs of
producing a blockbuster, costs of paying authors/musicians a salary so they can
eat. What’s the difference between
saying that Michael Bay will produce a movie if he can get it funded and that
an intermediary needs to have resources to fund blowing stuff up? If the paper is framed as justifying
incentives for intermediaries, aren’t these really just ultimately incentives
for creators?
Certainly true that a content creator has to be risk-seeking
to enter a creative market, but this is part of the “romantic” story of artists—people
move to NY in droves to seek this risk. Not obvious that long-tail, long-term
structure of copyright is necessary—could just have a very short term.
Marketing and distribution: hits are still as important as
ever even in an era of rampant production. Consumers need help!
What’s the normative significance of that? We don’t really know whether mass marketing
of songs is socially beneficial. Might make songs cheaper but it’s hard to tell
what that means.
Barnett says the internet limited the value of copyrighted
musical works, causing shift to live performance. Intermediaries—ticket vendors,
concert venues—are still vital, but the issue is the proper role of copyright.
Concert ticket prices have gone way up—Pearl Jam won’t play a cheap show to get
you to buy their CDs. But on the whole it’s very hard to do the welfare
analysis given the moving parts—more access to recorded music, less to live.
Barnett: in patent, it’s clear that you need to cover the
costs of invention and of commercialization.
In copyright, the consensus is that copyright doesn’t make sense because
it’s been captured by concentrated interests.
That’s possible, but is there an efficiency story for why copyright law
looks as it does? The big picture story is that there is a plausible one. The
positive and normative aspects of the paper are separable. Canonical economic
models don’t take into account anything that happens after creation, but that’s
where all the cost and risk is. The real
world literature has a consensus: there is a heavy skew in creative markets to
hits. Most is junk and losers and a few
are gangbusters, and that’s what drives investment. The core problem as an economic matter is
risk. You must be able to spread away the risk of losers, in film, music, and
books. And the history of mass
entertainment markets all shows concentrated intermediaries. It’s not just entry barriers—independents are
always being acquired by majors, contracting w/them for distribution, because
the only way to make money is by having a portfolio.
Q: what does low quality/junk mean?
A: just market success—not a noneconomic judgment. Is the star just an economic
construction/tool of consumer manipulation? Tends to think not. The risk
problem in creative markets is double-sided.
Stars can be used as a proxy for the quality of the film. Is that a
function of the intermediary? Put to the
test in the digital era, where we have far greater access to other sources—we can
listen to anything, and we still like Michael Jackson best. There’s an economic function of the star:
limiting search costs; the consumer hedges against the risk of consumption
loss. (I thought he was going to say
that Kickstarter/Veronica Mars was an
example of consumer hedging!)
Wendy Gordon: difference between incentives to creators and
intermediaries: if your argument hinges on the need to pay stars, that’s an
argument for paying creators.
A: Emphasizes the issue with free riders who haven’t
invested in paying for the losers and can thus underprice on the winners. There are other possible mechanisms to
capture revenue, like lead time, but from an efficiency perspective we shouldn’t
just be trying to get a reasonable level of output; we should get an optimal
level of output, and for that, we don’t know whether lead time advantage is
sufficient. Chinese film industry makes a ton of money without controlling
piracy—it’s a viable system to do simultaneous relief. But what we don’t know is whether it’s
optimal, because windowing is impossible in China and they’re compelled to
choose that model.
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