Moderator: Kristen McCallion, Fish & Richardson
Gerard Lewis, Comcast
Courts have enshrined various business models—is that a good
model going forward? Public performance:
relatively new right. History of figuring out whether communication to the
public was a public performance. Move of
radio and then TV from foreground experience to background/pervasive. Change in
technological limitations—innovation to improve the experience. Court initially
said that cable TV wasn’t a public performance, just an enhancement of the
transmission. Congress acted: framed
exclusive right broadly, definition of public performance broadly. Exemption
for homestyle receivers in public places was framed very narrowly. Made a number of assumptions about tech: tech
available for private homes would remain distinct from that available to commercial
establishments, an assumption no longer as valid now. Technical and detailed factors—number of
receivers, length of wires, money taken in by establishment; contrast to broad
definition of exclusive rights. Result:
Fairness in Music Licensing Act, expanding the exemption, nearly 600
words. Next copyright act: don’t want to
count bytes or other technical factors; that doesn’t seem to work.
Predictability and certainty are desirable, but worry about
purpose built and specific provisions, such as AHRA model, where tech quickly
becomes obsolete and doesn’t provide guidance.
Felix Wu, Cardozo Law School
Judge Chin in Aereo: Courts should resist the temptation to
look under the hood. Aereo feels a lot
like a cable system—functionally, is it the equivalent? A different case: ReDigi: tried to create a
market for digital first sale. SDNY said there was no digital first sale,
because there was reproduction and not distribution. If you didn’t look under
the hood, the result might have been different.
Not obviously a principle that
favors owners/nonowners.
So what should we do going forward? Not clear that Congress
has led/signalled at all. One key question to answer in the next formulation of
exclusive rights: how much will we look under the hood and how much define in
functional terms. (Why not go all the
way to making available?)
We need to know the underlying goals of © law to have a
functional definition. So his concept
might be access. Reproduction might have been an attempt to mediate access to a
work. Counting the number of books printed gave you some idea of how many would
have access, though there’s not a pure 1-to-1 correspondence. But access is now potentially on both sides
of the equation, not just incentives v. access.
Consumptive/productive access. Is there a better way to split consumptive
from productive uses? Though of course those categories are tied up.
Neil Netanel, UCLA Law School
Conducting empirical study of infringement/substantial similarity
cases. Trying to figure out what the
tests are, whether there’s any correlation with outcomes, types of work,
identity of parties, etc. Paul Goldstein
said the most important rule is that Disney never loses; wants to test that
empirically (now that it has Lucasfilm, it at least inherited a loss or
two!). Do courts filter out
unprotectable elements, and how do they define those? For which issues do they
rely on expert testimony? How often do defendants admit copying or access? When
there’s an exact copy, a prima facie case has been made: defenses will either
be ownership, noncopyrightability, or another affirmative defense. Most
interesting/troublesome cases involve comprehensive nonliteral similarity (like
the recent Disney/Snowman
case, which may also provide a data point).
Second Circuit and Ninth Circuit offer the major approaches. 9th
Circuit’s extrinsic test seems to cover both “copying in fact” and “wrongful
copying,” and then its intrinsic test seems similar to the 2d Circuit’s
test. There are lots of variations on
these themes even within the circuit.
Students invariably ask whether the tests make a difference. We don’t yet know, and that’s why we need a
study.
Lots of criticisms of these tests; Pam Samuelson & Mark
Lemley prominent among them. Both argue
for some version of inverting the stages, or bringing more objectivity from
first stage to second. Initial results
suggests it’s even more a mess than we thought.
Initial survey was developed based in part on Second Circuit’s
distinction between copying in fact and wrongful copying, and we asked if
courts actually made that distinction, or applied the inverse ratio rule. We found out in the pilot that our RAs had no
idea what we were talking about because even in the 2d Circuit courts often
make no distinction whatsoever between copying in fact and wrongful copying;
they just talk about “copying” or “unauthorized copying” w/o making it clear
whether that meant license or authorized by law, or “protectable expression”
without saying how much or what that meant. Redesign: ask RAs to identify
statements about what would support a finding of infringement, and then
determine which statements go to copying in fact/wrongful copying.
What should be the locus of reform? Preliminary experience suggests that some
clear pronouncement of the test and the relevant factors is needed, whether
from Congress or the SCt.
Christopher Sprigman, NYU Law School
To an antitrust lawyer, much about copyright seems odd,
including the prima facie structure of a copyright case. On one end of spectrum, massive commercial
infringement—copies of recent blockbuster. At heart of copyright law:
consumptive, compete with originals in market, displace demand otherwise
satisfied by legitimate work. At other
end: parents post video of toddler dancing to a Prince song—not displacing, not
a valid licensing market. Yet copyright law prescribes the same sort of prima
facie case for either, despite the different effects on authors/markets. For an antitrust lawyer, this seems odd. Antitrust is based on the view that
competition is efficient; copyright holds that unrestrained competition among
copyists results in market failure. Sprigman has no quarrel with this more
pessimistic account of competition in some ways, but different acts pose
different risks, and the law should deal with it better.
Antitrust has the same problem and does deal with it better.
Some conduct is highly likely to be harmful, like cartels. Exclusive deals may
sometimes harm competition, sometimes be irrelevant, and sometimes help competition. Antitrust marks out a
category for per se violation of the law: Ps need not prove market power or
harm to competition; such harm is conclusively presumed. For all other conduct,
antitrust uses a rule of reason. P is required to show market power and likely
harm to competition. Makes sense: where we believe that conduct is very likely
to do damage and very unlikely to produce benefit, we give P a cause of action
that is essentially strict liability. For other conduct, we put P to the proof
that the P ought to be in a position to produce. What’s in the category changes over time—minimum
resale price maintenance has been moved into rule of reason.
Contrast with ©, where no P is required to show harm as an
element of the prima facie case, even when the conduct seems unlikely to cause
harm. Castle Rock: never showed that they wanted to enter the quiz book
market, but court just hypothesized that they could and thus hypothesized
harm.
Could we import this mechanism into the next great copyright
act? Yes, we could have a category of per se copyright infringement—current liability
structure should be for this category. Everything else should be rule of reason
and P should be required to show harm as part of the prima facie case. He has suggestions, but they are a first cut—copyright
litigation should be an engine of learning, which allows Ps to provide evidence
about what causes harm (and what doesn’t), so the categories’ content can
change over time.
(1)
Only registered works should be in the per se category.
Registration is a signal about potential harm.
Registration should produce a bigger difference in treatment.
(2)
In addition, use of work must also be
consumptive/likely to displace demand. Thus it must be exact or near exact
copy/performance.
Everything else should be rule of reason: derivative works,
unregistered works, licensing markets not involving exact copies. Sprigman’s
article on this proposal covers this in more detail.
Q: what about antitrust power of large aggregations of
copyrights? ASCAP/BMI consent decrees ended up in pretty workable licensing
scheme. Is there any point in looking at major film companies, etc. for
something like that?
Sprigman: antitrust consent decrees are example of antitrust’s
ability to learn. Price-fixing is possible, but blanket licenses also lower the
cost of licensing, which requires ingathering copyrights. Blanket licenses are
procompetitive, plus safeguards to prevent abuse. Safety valve: resort to court
determination of rate; rules against exclusive licensing. SESAC is now under antitrust attack from
private plaintiffs, and got past the motion to dismiss case because SESAC has
struck exclusive deals for what Ps say are must-have categories of music and
raised prices substantially. Conduct comes in various forms—antitrust can look
at this as copyright hasn’t except a bit in fair use analysis. Need more because fair use is subject to a
chilling effect.
Q: isn’t this too expensive to prove market harm, as in
antitrust?
Sprigman: doesn’t think so, but we can learn over time. Could have various presumptions to help
Ps. Antitrust has a sunny view of
markets—tends to see them as resilient to anticompetitive conduct, while
copyright doesn’t, and he thinks the empirics suggest copyright is wrong—markets
adjust to piracy. May not adjust optimally, but we don’t actually know what the
optimum is.
Q: could fair use get us to that world? How would a rule of
reason reduce chilling effects more than fair use?
Sprigman: fair use has gotten more capacious relatively more
recently. We’re seeing some market harm principles enter through the back door,
but that’s not efficient. Channel litigation according to whether market harm
can be shown.
Q: format shifting is becoming more relevant—backups, Kindle
to hard drive, etc. Is there a way to bring this into formalization? (Private copying exceptions that plenty of other countries have,
maybe?)
Wu: that’s an example of figuring out what we mean by
access. Why would format shifting even be a problem? Because we’re focused on
reproduction. If instead we focused on access, that would suggest that format
shifting isn’t something we would care too much about.
Glynn Lunney: public performance right used to be against
competitors; there used to be natural monopolies, with only one large theater
in town, one or two TV stations. How should we structure public performance now
that’s not true?
Lewis: transmit clause tries to deal with that, but doesn’t
necessarily do it well. Physical natural monopolies are largely past (RT: um,
at the content level maybe, not at the Comcast level!). Cloud services—can rent space on Amazon and
be as much of a cloud provider as Netflix or Dropbox. Wu’s point about looking under the hood: we
might not like what we see, or we might need to figure out what counts as a
hood. Need to know the problem we’re
trying to solve.
Q: of the various tests for nonliteral infringement, do any
adequately address software?
Netanel: Typically in software cases the test is much more
abstraction and filtration based.
Merger, etc.
Sprigman: the way they vary it has to do with competition.
Filtration is a decision about competition.
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