Friday, June 14, 2019

A Celebration of the Work of Wendy Gordon, part 4

A Natural Right to Copy by Glynn Lunney, Texas A&M University School of Law
Thanks to the great women who encouraged intellectual honesty in topics and analysis of topics, not just Gordon but also Litman, Samuelson, others.  Gordon doesn’t agree w/how far Lunney takes her argument, but that’s ok.  Gordon’s “A Property Right in Self-Expression” shows that Lockean arguments for authors’ rights also provide limits on those rights that are themselves in the nature of natural rights.  Lockean proviso: there has to be enough and as good left over for others in order for property claims to be justified. Is copying right or wrong?  There is dispute! 

He thinks natural rights are nonsense on stilts; natural laws would exist without people.  He thinks it’s often just hidden utilitarian balancing.  Kant’s Categorical Imperative: if the Nazis ask you if you’re hiding Jews in your attic, should you tell the truth?  Utilitarian balancing would give us a very different answer.  A natural right should also be technologically independent, which seems inconsistent with © and its recency.  He thinks of natural rights as rhetorical tools.  Rhetoric, though, matters. [Lunney characterizes natural rights arguments about fairness as “utilitarian arguments for people unable to do math”—but of course none of us can really do math, in the sense required for doing utility calculations that would take into account all the knowns and unknowns, especially at the level of detail required to distinguish two fairly similar policies from one another.  Thus the appeal of rule utilitarianism and so on. Obviously this is a much bigger debate than any of us can do justice to right here!]

Judges sometimes equate copying with stealing, but he thinks this is wrong.  Moses smashed the original tablets from the mountain; we only have the Seventh Commandment because Moses copied them and plenty of others did too. Copying is never stealing and an expansion of the no-harm principle that equates them is difficult for him.  No-harm principle: Locke says no one ought to harm another in life, health, liberty or possessions—but there’s nothing in there about economic harm/deprivation of royalties.  Mixing labor as justification for property seems inconsistent w/counting economic harm—if value alone justified a property right, we wouldn’t care about how I got a pile of apples.  This is relevant because of the well established principle of damnum absque inuria: harm without legal injury, as when competition decreases profit.  Gordon does distinguish harm from wrongful harm, but not all free riding is wrongful harm—Kellogg copying Nabisco shredded wheat and automakers copying the idea of the minivan are both desirable forms of competition based on free riding. 

Gordon suggests that utilitarian balancing can trump deontological concerns when the costs are too great. How do we know when they’re bad enough? Who decides?  Category error: even if you could use Locke to justify initial ownership of the song, what does that mean when you’ve shared access w/another? Locke is about initial ownership, not what rights you retain even once you’ve transferred in the absence of an express or implied contract.

Contributions to value to a novel other than the novelist’s own work: the people who taught her to read and write; the people who created moveable type and all the other distribution elements; people involved in creation of market demand, such as people who paid workers enough to have money left over to buy the novel. Once you do but-for or even proximate causation all of those matter.  He thinks what’s efficient and fair is a cost-based allocation.  Inefficient and unfair to have a rule that’s cost based for everyone but the © owner who gets a value based reward.

What should be the default rule? What’s more important to society, copying or creativity? To him, it’s copying. We talk today b/c we share a language that neither of us came up with or decided to adopt. We both copied the language and its structure.  What we’re doing in © is important but what’s more important is the right to copy and talk.

Commentary by Richard Stallman, Free Software Foundation

Defaults are tremendously important. “IP” is both wrong descriptively and an overgeneralization about the very different regimes lumped together under that term. It gives you a bad way of thinking by default.  Law professors can probably overcome that but if you don’t spend a lot of time with it, that will mislead you. Natural rights have to be about morality; natural rights imply natural responsibilities, though that doesn’t mean you have to do a recommended act every time. E.g., sharing is good/feeding the hungry, but you don’t have to do so every time you’re asked; it’s instead that if you never do it then you’re not a good member of society. Respect natural rights and permit people to carry out their natural responsibilities to share.  You don’t “consume” published works. They don’t disappear as your eyes pass over them. It’s an economic metaphor that also changes your default thinking. The idea that you have to compensate a business for not being able to make money from something that it bought is planetary suicide when it comes to resources, and this relates to © as well.  Would also distinguish software from creative works; software as a set of instructions needs to be free or it subjugates users.

Syed: Lunney was careful and crisp in discussing deontology, but lumped utilitarianism together.  If you’re truly a maximizer, do you believe that fair distribution plays no role?

Lunney: people would choose fair distribution over unfair, because we’re risk averse; distribution is a utiltiarian consideration. 

Gordon: it’s true that Locke justifies right to use more than right to exclude. But what he’s describing is one of many ways of saying, all else equal, if someone has invested a lot of himself into a project, you have an obligation not to disrupt that project without a good reason, though we can then talk about what good reasons might be.

Lunney: prefers the defaults reversed. Who has to justify a change in the default and what does it take to do so?

Unfair Use as Market Failure by Ariel Katz, University of Toronto Faculty of Law
Fair Use as Market Failure’s contributions include: theoretically coherent framework for understanding fair use, at the time a mess; pioneering economic analysis of copyright; offering economic justification for fair use; showing how broad fair use conception is economically consistent w/©’s premises. Alas, misunderstood as implying that fair use should only exist when transaction costs are high and should disappear if transaction costs become low enough to allow negotiation b/t © owner and user. Instead, looking at whether there is a reason we can’t be confident that deferring to the © owner’s self-interest will also lead to overall social benefit? If we can’t, then there is reason to go to fair use. But this logic presumes that we can ordinarily be confident that deferring to self-interest will serve social goals, and if and only if that isn’t true, such as market failure, then it might make sense to refuse to defer to © owner’s veto.

But should we ordinarily be confident of this? Why not require © owners to show that their self-interest aligns with the public interest?  What creates pull to overly narrow fair use: (1) market supremacy premise: in general, social welfare will be maximized if market transactions b/t © owners and users would precede as many uses as possible bc the market is in general the best way of doing things; (2) broad entitlement: © owner is ordinarily entitled to revenue for all substantial uses of the work; (3) when economic value is at stake, we ordinarily want a potential user to seek permission from © owner and pay a negotiated price.  Begins with the assumption that © markets are efficient, but they are usually understood as deviations from static efficiency done in order to create incentives (keeping prices above marginal cost). Copyright by design undermines the perfect efficiency of the market.

Relatedly, do we want as many uses as possible to be market transactions? The opposite: social welfare is maximized if we have as few uses as possible as market transactions.  Nor should we agree with (3)’s broad entitlement: fair use isn’t an infringement and not part of the owner’s entitlement, and a © owner shouldn’t get more than necessary to generate works. It is, in other words, unfair uses that present market failures. Copyright is against natural rights; it is a legal monopoly and a creature of positive law only.

Commentary by Chris Sprigman, NYU School of Law: Microsoft antitrust litigation was how he started to learn ©: Microsoft’s argument was that it owned the © so nothing it could do with the © could violate antitrust law. Court says: saying you own the © so you can’t violate antitrust law with it is like saying that because you own a baseball bat you can’t be held liable for killing someone with it.  Monopolies and market supremacy: this is the key idea, that property structures markets and that the markets are run by private transactions by default.  Broad entitlement then follows from that: © owner is entitled to all rents that market supremacy makes available.  So is the idea that we ordinarily want transactions to take place b/t © owners and users of the works.  Combination: strong deference to © owner, which then leads to overly narrow reading of Gordon’s work on fair use. 

Katz’s first best solution where goods are nonrival: competition.  Katz would presume fairness until unfairness is demonstrated. But what’s Gordon’s first-best world?  Have to think about static v. dynamic efficiency. The holy grail would be to optimize static + dynamic efficiency. Gordon’s first-best would be a copyright system that does this. If you believe that copying causes long term welfare loss, you should end up with “efficient copyright.” Under that scheme, Gordon’s premises hold.  Rights with appropriate scope, term, and limitations. But we don’t seem to have that, e.g., it’s hard to understand the point of © for fine art. Balancing static + dynamic efficiency seems unlikely given how much lumping together Congress has done, even if you ignore problematic political economy.

What is to be done? Should judges interrogate the static/dynamic balance, the scope, the limitations that Congress has enacted?  Care is warranted, but Congress has left open some room, viz. fair use. Even if fair use is a defense, it isn’t an affirmative defense: the P should, once raised, have the burden of going forward—Lydia Loren’s article and the reasoning in Lenz in the 9th Circuit.  Skeptical about judges doing other things in ©; we don’t have a different term for motion pictures than for software, even though we probably should, and judges would have a hard time doing that.  [I would note that anywhere else in speech regulation judges have no problem saying things like this and performing their own static/dynamic/other analyses—that’s what strict scrutiny does.]

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