Here we'll explore the nexus of legal rulings, Capitol Hill
policy-making, technical standards development, and technological
innovation that creates -- and will recreate -- the networked world as we
know it. Among the topics we'll touch on: intellectual property
conflicts, technical architecture and innovation, the evolution of
copyright, private vs. public interests in Net policy-making, lobbying
and the law, and more.
Disclaimer: the opinions expressed in this weblog are those of the authors and not of their respective institutions.
Our friends at ISRI sent a note saying that Congress had gotten its act together to pass the bulkily named "Unlocking Consumer Choice and Wireless Competition Act" which includes provisions allowing companies and individuals who recycle and refurbish electronics to unlock them as part of their business.
This should serve to remind everyone that while the Internet is perhaps the most amazing commercial platform yet invented, it's also an information access mechanism for schools, for libraries, for communities, and for the public. As such it needs not to have "paid prioritization" and it needs rules that allow us to choose what we get, not the cable companies. The Internet has a public, an educational, and democratic imperatives that are every bit as important as its commercial imperative and don't you forget it.
The Canadian government has been sued by Eli Lilly to the tune of $500 million, based on similar provisions in NAFTA, because the corporation objects to a Canadian Supreme Court ruling rejecting the patent for two of its blockbuster drugs. As a result, Canadian law could be overturned by a ruling made in a secret, private arbitration proceeding.
As before I feel I should note that I am a long-time donor to MSF, but have no other affiliation with the organization.
The show is largely based on a paper published by two economists, Michele Boldrin and David Levine in which they argue against patents from an economists perspective. The very first sentence of the paper states baldly that "there is no empirical evidence that patents serve to increase innovation and productivity." In fact, they argue, the opposite is happening. Innovation and productivity in their view happen most from competition and being the first to be able to get something to market (first mover advantage).
As with many grand theories in economics, the proposed changes would include losers and risks. The losers are individuals and small enterprises who now make money from licensing. In their view such people should just go work for big companies that would pay them to do the same innovative work.
The risks come from things like medicine or nuclear power where the idea of patent protection contributes to companies making billion-dollar investments. Boldrin and Levine argue that it would be more efficient for the government to create a system of incentives whereby multiple companies could compete for the work in return for paybacks that would cover their investment. Given how massively inefficient government contracting can be today I'm highly dubious this would increase efficiency in the IP space.
Their "modest proposal" however, seemed like a good idea, which was just to reduce the terms of patents. Presently patent protection is 20 years, so turn that down to 18 and see if it makes any difference. If you get more productivity with less patent protection you could shorten the term still farther. Eventually either you'd find that less patent protection was not increasing innovation or you'd find that you'd reduced protection to zero while increasing innovation in measurable steps along the way.
We music people know payola when we see it. And what we see in Chairman Wheeler’s proposal doesn't give us any confidence that we won’t end up with an Internet where pay-by-play rules the day. We've heard this song before, and we’re frankly pretty tired of it.
Thousands of us have already told the FCC that losing an open Internet would be disastrous to the music community, and we suppose there's no harm in telling you again. But this time, we really hope you'll listen. We may not be telecom lawyers, but we get this issue pretty clearly. You have the legal authority to prevent discrimination and paid prioritization online. You only need to exercise it.
The thing he's offering is, nominally, is himself making potato salad. Yes, really. He's raising a few bucks to make potato salad. Why, then is he getting tens of thousands? Ferret's answer is, basically, "entertainment." The potato salad concept is silly and as the campaign has grown, more silly and goofy things have been added, like "a bite of the potato salad". Clearly that's not something you'd normally pay three bucks for, but so far over 600 people have thought it was funny enough to do that.
And there's the trick: make your campaign about "how you make the donator feel" and you can be more successful than trying a serious approach, especially if what you're pitching is something potentially desperate or depressing. By making this potato salad silliness feel like fun, it became something people wanted to feel involved with.
The lesson about Kickstarter or Indiegogo or any donation drive is that you get what you give
Therefore, he argues, anyone doing business with them needs to treat it as a business arrangement. If you are an author and Amazon is doing well by you, then that's great - continue doing business with them. If you are a reader and are unhappy that Amazon is making it hard to get certain books then take your business elsewhere. But whatever you do, treat it as a business proposition, not a personal/emotional proposition.
I'm sure there will be plenty of analyses flowing, and lots of people commenting on the implications of this decision. It seems like a small area of the law, but it's possible that this ruling will be used against a wide variety of nascent businesses, despite Breyer's apparent intention that the decision be read narrowly. The decision seems to go to great lengths to say that Aereo is (like) a cable company and thus should be subject to the copyright restrictions. Breyer specifically calls out a position taken by the US Solicitor General
that “[q]uestions involving cloud computing, [remote storage] DVRs, and other novel issues not before the Court, as to which ‘Congress has not plainly marked [the] course,’ should await a case in which they are squarely presented.”
That's a good theory; let's see how it shakes out in practice. My cynical side thinks the Cartel will still see this decision as a green light to go after cloud storage companies in general.
The archives have revoked the Beacon's access to the archive, on the grounds that publications in the Beacon used audio recordings from the archives without permission. In a written statement, the Archive says:
The University, however, does not tolerate the blatant and willful disregard of its intellectual property rights and policies.
This is a tricky matter, from a policy standpoint. Libraries often maintain various controls over different collections as well as enforcing copyrights held by authors of material in the library.
However, when those rights restrictions impede conversation about a controversial public figure we start adding in questions of what's in the public interest. This is the core of the Beacon's response to the Archive - the claim that their investigative reporting serves a general public interest. Which is, we should all remember, the reason copyright was invented.
Mike Masnick's piece on Alice v CLS Bank more or less follows the lines I'd expect. However, he points out that Thomas's opinion, rejecting the Alice patents because of generic computer implementations, doesn't give good guidance because the same argument could be made about any computer program. In essence, Masnick argues, SCOTUS is continuing to pretend that some software is patentable and some is not, while refusing to give examples or guidelines for drawing that distinction.
A reader pointed me to a blog entry over at the Library of Congress discussing animated gifs. The posting describes a little of the ubiquity of these Internet-spawned forms of communication and then asks the question: what about copyright? The answer seems to be that copyright claims don't arise because animated gifs rarely attribute authorship to their creator and because they often use tiny fragments of previously published media in a society where we generally understand the creative reuse of small samples to be fair use. RIAA excepted, of course.
The case, conventionally known as Alice Corp v CLS Bank dealt with challenges to patents held by Alice Corporation. I've read through the decision once and I expect better analyses will enlighten things in days to come, but what I see is that the Supreme Court is still swimming about in murky §101 waters. In particular, SCOTUS agreed with the CAFC that Alice Corp's patents were invalid because "...they are directed to an abstract idea." As such, they're not proper subject matter for a patent.
Thomas's opinion is pretty short and if you don't agree with the previous line of SCOTUS reasoning then you're not going to like this opinion either because it goes to great pains to trace how those past decisions require the present conclusion. Thomas reviews the reasoning in Mayo, and relies on that decision and Benson to argue that the patent claims construction "merely require generic computer implementation" and that this doesn't make the underlying ideas eligible for patent protection.
I was not aware that five Native American individuals had brought a case before the USPTO requesting that the mark be cancelled because it disparages Native Americans. This morning, the Office issued its ruling, finding that a series of marks must be cancelled because they were derogatory terms at the time of issue.
The idea is simple: you (the consumer) pay to get ad-free videos from labels who have also paid to be on the service. YouTube profits, everyone else loses. As a business model, it beats the hell out of thin gruel ad-supported, which is what the Google service has now. They want to be competing with Spotify et al, and they have the billions of yearly viewers to do it. All they need is providers (major labels) to pony up, and people to go along meekly. Because that's what you can do when you've gathered up enough eyeballs and browser clicks.
YouTube is pretty clearly aware of how much power it holds - witness how it forced G+ on everyone who used to comment on videos. Even today if you search "youtube comments" the top hits are "Youtube comments not working" or "Youtube comments not loading" and the like. But they just sat back calmly and weathered the storm. Now everyone thinks this is just fine and people still post their videos there. I expect exactly the same thing to happen with music videos; when you have little or no choice, complaining about it doesn't broaden your choices.
“We would not want someone to mimic our car in such a way to deceive customers into whether it is a Tesla,”
which sounds to me like he's talking about design patents or trademark infringements.
Don't get me wrong - I think Musk's intentions are good and this move is going in the right direction, even if it's largely symbolic. But I don't think it's nearly the big deal it's been hyped to be, and it's definitely not a giveaway.
The CoC posted that "A fair use of a work is an infringement" which is directly contradicted at 17 U.S.C. § 107, which states that a fair use is not an infringement.
To be fair, the distinction is somewhat subtle, because it turns on the notion of how fair use is invoked, as a defense against a charge of infringement. To be charged with a crime is to require a defense against that crime; if your defense is accepted then by definition you did not commit that crime. So it is with fair use - it acts to defend users of material against infringement charges and if their fair use defense is sustained, then they did not commit an infringement.
Subtleties aside, though, you'd expect an organization like the Chamber, which is purporting to lecture people on "5 Copyright Terms We Need to Stop Using Incorrectly", to get its basic facts correct.
The first one that appealed to me is for aspiring writers to practice pitching, particularly pitching ideas that stretch the author's capabilities. It's easy to write what you know and find yourself repeating what's already out there; pitching slightly newer, different, or even riskier ideas may catch publishers' attentions. She also advises not trying to monetize one's blogging, but rather to use the for-free writing as resume, and as a way to garner attention on social media.
There are two stories grinding their way along, most of the action being out of sight. The first being Oracle v Google arguing over the APIs for the Java language, and the second being Amazon and Hachette arguing over (probably e)book pricing. I haven't said anything about either case because there wasn't a lot going on that wasn't repetition of the basic points. I found a couple pieces that did raise good points, so let me cover them.
Masnick notes that the case started out as a patent issue (which is how it ended up at the CAFC) but they somehow morphed it into a copyright decision. To do that they had to reverse completely the original finding that the API is not the software. I'll admit this isn't readily apparent to people who write code and like other writers I have to reach for analogies. Part of that is because software isn't like most things in the world - software on its own doesn't do anything, but it controls anything that can be built to do any task we can manage within the limits of physics. An API is a way of giving instructions, not the instructions themselves. You might argue that there's a patent issue here, and I promise not to re-open the "is software patentable" debate, but seriously, guys, it's not copyright(able).
Masnick's piece makes the important point that many other news outlets have not - this is far from the end of the line. Google can, and should, appeal this disaster of a ruling either to the en banc CAFC or straight to the Supreme Court, which some argue is on a roll of smacking down CAFC overrreach. He rounds up some good opinion pieces from folk like Tim Lee and the EFF on why this decision is a roiling disaster, if it's allowed to stand.
Hachette for its part has joined forces with other retailers such as Walmart and B&N to discount and promote the things that Amazon is hiding. However, given that Amazon is a monopsony, there's not a lot that a small publisher like Hachette can do. In his blog piece Shatzkin lays this out in step-by-step detail and points out that the avalanche has begun and it is too late for the pebbles to vote.1
Shatzkin seems to think that the only thing that can keep Amazon from continuing to use its dominant position to the detriment of everyone else is outside (read "government") intervention. I think that's a nice fantasy but given the current Administration it's, well, fantasy. Honestly, I don't have any better ideas. At best I can see Amazon's behavior driving further consolidation in the publishing marketplace until there are only 2-3 publishers to deal with, who may have enough leverage and deep enough pockets to stand up to Amazon.
1 Yes, I am a giant SF nerd. You're all surprised I'm sure.
In particular, Rantanen takes issue with how the EFF appears to be keeping score. By noting that the CAFC has lost decisions unanimously, Vera Ranieri of the EFF claims that the CAFC is now "0-45". Well, yes, but. Rantanen points out that SCOTUS denies more cert petitions than it grants, and frankly it's rare for SCOTUS to take a petition if it's just going to uphold the decision. Overall, he calculates the SCOTUS reversal rate at 72%. I suspect that in this respect the CAFC is better than the 6th or 9th Circuits, both of which have a long history of having their decisions overturned.
And even if we restrict ourselves to petitions that were granted, Rantanen further notes that:
out of the 13 patent cases arising from the Federal Circuit since Bilski v. Kappos, the Supreme Court has affirmed the outcome in whole or part 7 times
That's not a bad rate, really, so maybe the EFF should tone it down a notch.
The case involved another 'fitness' company - information fitness in this case. FindTheBest is a start-up that offers to help people match up offers with needs. According to Lumen View, FTB was in violation of a patent Lumen held and it sued in what has become a typical troll pattern: the suit was held back if only FTB would settle; Lumen filed a large number of similar suits all at once, etc. Most tellingly, according to the judge's decision in this case Lumen didn't do "any reasonable pre-suit investigation."
That led the judge to determine that Lumen's case fit the criteria laid out in Octane and Judge Cote has found this case to be an exceptional one that justifies shifting FTB's legal fees to Lumen. The exact amount of this shifting is still to be deteremined, as FTB will have to show the judge what it cost to defend this case.
It will be interesting to see what Lumen's response is. They may just chalk one up in the loss column and move on, assuming that other defendants will be more willing to settle. A district judge's ruling isn't precedential in other jurisdictions, but it should be helpful to other defendants. If there's a District split then that gives Lumen stronger grounds for appeal later on; on the other hand, the risks of multiple judges following Judge Cote's reasoning might give them pause.
You can read about the details of the cases if you like, but the key point is that the CAFC and SCOTUS continue to disagree about major elements of, and interpretations of precedents for, patent law. This runs directly counter to the purpose for which the Federal Circuit was created, which is bad news for litigants and application writers. However, the specifics of these two cases probably make no difference because they are just part of an ongoing "pissing match" as Greg Aharonian calls it between the two courts.
Aharonian, in his emailed PATNEWS newsletter, points out that in theory SCOTUS can direct the CAFC to decide cases according to its decisions but in practice there's no enforcement mechanism. This leaves the CAFC judges free to ignore Supreme Court mandates and suffer no consequences as a result. The losers, again, are the people who have to litigate these things because when CAFC renders a decision that contradicts SCOTUS instructions it's still up to the litigants to appeal back to the Supreme Court to correct the CAFC's error.
I'm not a lawyer and I have no idea what mechanisms exist that could help with this situation. I know that we have problems with bad patents and people abusing the patents that are issued, but even once those problems get fixed we will need a unified judicial voice to interpret patent laws in light of new scientific and technological advances as well as new social understandings. This? This is a disaster.
Sundman's publishing journey is unusual, probably unique. He began with a Creative Commons-licensed work (Acts of the Apostles) that got a positive review on /, and saw a spike in popularity on Amazon. The novel was then sold to a small indie publishing house that was set to produce a revised version but was instead bought out by a bigger house. The rights then reverted to Sundman who wanted to produce a revised version of the book, incorporating improvements. The result is called Biodigital and it's about 60/40 reworked material/new material.
This sort of thing is (or used to be) quite common in the music space. Bands would release an EP with 4-5 songs and then later a full-length LP or CD containing those same songs - perhaps with a more professional production polish - and some new material. Record companies are set up to do this. Book publishers? Not so much. Sometimes you get a novel that's been made out of a short story (e.g. Ender's game) but nobody I know of has taken a previously published novel and remixed it themselves.
So, that's one point of view. Or, you could just pay the goddamn writer what they're worth. In this clip from an upcoming documentary on Harlan Ellison, the author rants about the "assholes" and "amateurs" who agree to work for free. Ellison wants to be paid for his work - in this case for an interview that Warner Brothers wanted to use on a DVD.
A real author, in this case Ellison, wants to be paid for their work particularly when that work is going to be used in a for-sale enterprise by a highly profitable mega-corporation such as WB. Ellison's rant is necessarily simplistic, but he has a basic point: the explosion of free content is making it difficult for people who want to make a living. The difficulty - again, see Erin Biba's rant - is that even people who are making money at these sorts of businesses seem to want contributions to come in for free. We, the public, give our free labor and content to YouTube and Facebook which use that content to make millions. It's been a couple years since the Ph.D. elite began to revolt against the publishers who make millions off their free labor but that business hasn't changed.
We're looking at a very wide gulf here: on the one hand we have individuals like Sundman and Fleishman who are on their own trying to figure out approximately everything and having a hard time getting actual income. On the other hand we have corporate entities that appear still to be quite profitable yet take advantage of individuals. I have no idea how to bridge this gap.
Two articles on Medium illustrate the differences in how 21st-century business models are affecting different people.
The first is Erin Biba's short, sharp farewell to Medium. Despite being one of the better-paid writers on the site, she's only getting about 2.5 cents per click on her story. That's not enough even to think about living on, and it's well below the living wage (she doesn't specify how much) that she's getting from traditional media organizations.
The core of her rant is that new media organizations don't value quality, only clicks. This leads to a profusion of listicles, recycled mindless content, and other things designed to drive up pageviews regardless of the content of those pages. In other words, new media are getting what they (don't) pay for.
What's missing from Fleishman's piece is how this relates to a living wage. He calculates his profit at $3000 on over $53,000 base income. That's not even going to pay rent for the time the campaign ran, let alone any realistic calculation of expenses. Yes, the purpose of the campaign was, nominally, fulfilled. But what's the point of artists making these complex and time-consuming campaigns when they can't eat? I talked about this last October, when I backed the 99% Invisible Kickstarter and I feel like if Kickstarter is going to run aground this may be its weak point: however many dollars it can pour into product, we still don't have a reasonable and reliable way to compensate the creators whose products we want.
(h/t Boingboing where I first saw these stories linked)
As David Kravets reports for Ars, ISPs who are now part of the Cartel's enforcement arm have sent over 1.3 million infringment notices to customers in the last year.
Is it working? Depends on what you think "working" looks like. If you're the RIAA you spin this as "cautiously optimistic". If you're capable of looking at a calendar you might flip back to the dark ages of 2001 and note that it's been 13 years since Napster was shuttered and the Cartel is still treating its customers like the enemy. You might also note that trench warfare is really dull and unproductive and try to find more interesting things to blog about. Here, have a funny picture of a baby yawning.
The proximate cause is that the Chief Justice of the CAFC is stepping down from the Chief spot and the Court has had to re-issue two opinions in which soon-to-be-ex Chief Judge Randall Rader was involved. Rader recused himself from those cases, but not before he had been involved in the decisions (oops!). To make matters worse, the reasons for recusal involved ethical improprieties on Rader's part that call into question his fitness to serve as a judge at all. Rader effectively endorsed a lawyer, in a manner similar to an author giving a blurb for a novel they enjoyed.
Judges at all levels are supposed to be as impartial as humanly possible. Giving an endorsement to a lawyer - let alone one who might appear before your bar - is just not done. Yes, we know that judges are mostly former lawyers, and nobody expects them suddenly to drop their private friendships with other lawyers. But there needs to be at least some professional distance.
The CAFC was created in 1982 in order to merge two courts that were hearing and often competing in rulings over patents. The theory was that there should be one highest court for patent cases, which would lead to more uniformity and that this unified court would be able to delve into the more technical matters that patents often require. Unfortunately, the CAFC seems to have spun more and more out of control,
He notes that IP in games can involve multiple regimes: patent, copyright, and trade dress, which covers elements of physical appearance and is generally compared to trademarks or service marks. I am not enough of a lawyer to know what is covered by trade dress versus design patents - they seem essentially similar to me.
The reader question to which he is responding involves a complaint and suit by the game company Wizards of the Coast against competitor companies Cryptozoic Entertainment and Hex Entertainment. WotC alleges that the game Hex: Shards of Fate, produced by these competitors, is too much a clone of WotC's famous and highly lucrative game Magic the Gathering.
Without getting into the specifics of either game too much, TB argues that there are derivatives and there are clones. The latter are particularly prevalent in the mobile space where a successful game often finds itself facing a dozen nearly identical clones with the serial numbers rubbed off. Larger-scale game cloning is much more rare, though it does happen. On the other hand, games are like many other media forms in that they innovate by evolution. Game mechanics and styles are similar, but new games make changes and twists and try new combinations or new approaches to the same thing. It's not at all clear at what point any given collectible card game is going to wind up being too similar to another.
The PBS Idea Channel's May 7 episode looks at The Future of Fandoms. One cannot talk about fandom without running into fan fiction and the entire cadre of (usually not officially sanctioned) derivative works produced by fans. One of the possible futures posed in the episode is whether the growth, robustness, and increasing popularity of fandom will provide a more robust bulwark for fair use.
It's not an unreasonable question - despite the efforts of the Cartel and various large corporations to stamp out fannish work there are now things like fan-funded major films, and the 'Net provides ways for fans to organize and respond that did not exist decades ago. Where fan-created derivative works previously only existed in sort of shadowy or out-of-the-way spaces, you now have Comicon costuming on major news networks, Google images, Etsy stores, not to mention millions of blogs, sites, and generally transgressive Web pages.
By sheer volume it's impossible to police all this stuff, so the question is whether it will continue to exist in a legal limbo, or be able to be legitimized. My opinion is that we're unlikely to see a more robust fair use anytime soon, because the current regime works to everyone's advantage. Corporations can still selectively prosecute those works they find threatening, while making money off the fan base that is kept fed with the quasi-legal derivative works. Fandoms grow fan bases and keeping a robust fan base has always been in the interests of the promoters - that's why there used to be official fan clubs. And I suspect that many fandoms act as slush piles for creators. Most of it isn't usable but once in a while a gem will float by. Certainly enough people are convinced that commercial creators "stole their idea" to support an entire forest of advice and help Web sites.
It's also in the interest of the monied powers to keep people guessing. If you don't know whether or not the lawyers are going to show up at your doorstep you may self-censor, or seek licenses and permissions that you didn't actually need but are less costly than a legal defense against Disney's hatchet team. (Not to pick on Disney exclusively, but they are one of the most aggressive.)
If you think government is somehow going to come to the aid of fair use, well you haven't been watching the amazing amount of regulatory capture that has happened in the past six years. I doubt we'll ever see a major change in Executive position so long as there continues to be a revolving door between the regulators and the regulated.
Please understand that this affects all of us: journalists and whistleblowers most directly, but also those of us in the public at large who benefit from having crimes and malfeasance exposed. Without the ability to be anonymous, and the ability to approach trusted journalists who can bring governmental and corporate misdeeds to our attention, we will all be worse off.
The Supreme Court handed down two patent-related decisions this week, both with lead opinions authored by Justice Sotomayor.
In Octane Fitness, LLC v. ICON Health & Fitness, Inc. the Court addressed the issue of attorney fee awards. If you've been following the patent troll debates you have probably seen the idea that awarding attorney fees could be a way to curb some of the worst abuses of the patent system. The law presently allows awarding fees in "exceptional cases" but gives only only general guidelines for what could be considered an exceptional case. In a unanimous ruling, the Supreme Court effectively reigned in the Court of Appeals for the Federal Circuit's current method of exercising discretion in these cases and moved that discretion back to the District level.
I'm not well-enough versed in the law to have an opinion whether the Court got it right in this case, but I think this is a desirable outcome. Lately the CAFC has been arrogating extra powers to itself, making de novo findings and so on. I think these matters are much better handled at the district level, where evidence and findings of fact are normally argued. Yes, this will likely lead to more differences of opinion and I suspect that the CAFC and SCOTUS will end up having to make additional decisions that set guidelines but we need a rich debate in the Courts over how to apply the law as it's increasingly clear that Gridlockress isn't going to help.
In Highmark Inc. v. Allcare Health Mgmt. Sys., Inc. the Court addressed the specific grounds for finding a case exceptional and handed another weapon to the anti-troll fighters. By specific reversal, the Court held that continuing to litigate cases that should reasonably be known to be baseless (e.g. from previous losses) is grounds for fee awarding.
This is important as it can curtail two bad-actor practices: "forum shopping" in which a troll continues trying to win cases in different jurisdictions until it finds a friendly judge. Then that single victory can be used to pressure settlements from other companies. Additionally, some trolls have filed RIAA-style mass lawsuits, trying to hit as many targets at once as possible. Under Highmark a defendant against such a suit can reasonably ask a judge to suspend trial pending other outcomes since the mass-filer now would face the risk of having continued suits being subject to penalty awards if it lost a lead case.
It's really unsurprising, then, that other bits of the Cartel (the MPAA and its affiliates in this case) have also gotten in on the act. The recently resigned US Trade Rep goes to work for the Cartel, joining at least a dozen of his colleagues. Meanwhile, Obama nominates Robert Holleyman, fresh out of the pro-SOPA BSA, to be the new trade rep.