IPSC part 3: judicial panel

Judicial Panel: Chief Judge Diane Wood (7th Circuit) and Chief Judge Alex Kozinski (9th Circuit)
Peter Menell: Discussion question: is IP common law?
Wood: throughout the federal level, we are not a pure common law system, nor a civil law system. Since the outset we’ve been a hybrid, which is a background against which Congress legislates.  Obviousness in patent: what is that? The only thing to do is turn to decisions. Courts have to put meat on the bones, and lawyers have to advise clients accordingly.  Could IP be captured in words better?  If you think so, go to Congress, but she’s not bothered by present situation.  You can have ERISA if you want, or Clean Air Act with precise rules and precise regulations.
Kozinski: has a very different feeling about what Congress wants when he interprets the tax code. IRS has interpretive authority; very clear that generating activity is not our mandate in the tax code.  When you interpret a statute governing IP, you expect to come up with situations that are new and that Congress would have expected judges to address, rather than saying “Congress hasn’t spoken so we’ll deny the claim.”  Judges have a fairly broad mandate in light of anticipated changes in tech that create new problems.
Wood: when something is so different from what has come before, as ISP problem seemed to be in Netcomcase, you’re left with only a few choices. You can say “it’s so different it’s not covered by the statute,” which can be unsatisfying.  But most judges don’t prefer that approach for a law written as broadly as patent/copyright laws—Congress is trying to say that you should put things in one box or another: is there infringement or isn’t there?  Cautious opinion: try to find a result that draws some boundaries.
Kozinski: distinguish between what judges do and what they say they do.  Judges reach results and then they come up with arguments to support them.  Textualists find textual arguments and touchy-feely types find touchy-feely arguments. But we aren’t as different from each other in how we reach conclusions as we pretend. 
Menell: Copyright Act of 1976 has decades of public hearings behind it, while DMCA was drafted quickly and secretly. Do you think of those differently?
Kozinski: never thought of it.
Wood: Hope Kozinski is right about people who call themselves strict textualists.  She doesn’t just stare at the text of the statute.  Think about what these words mean in the broader context of the subject matter Congress was addressing.  She won’t go so far as to say judges start w/ result and then give reasons, but much academic literature on how judges think is a little weird for judges (bugs under microscope).  Before computers, you could trace judges’ papers/drafts and identify jettisoned theories—that’s not possible any more as she just deletes everything.
Tries to give most persuasive reasons, and will look at sources that resolve ambiguities.  Not a big fan of legislative history, dating to experience with statute they were trying to pass at the Antitrust Division where she worked previously. There came a late-night moment with staffers from the involved committees, and a controversial question came up—whether the US would lend its assistance to a foreign country that wanted to prosecute an entity recognized under US law—and she said ‘we can’t say we won’t do that, because that’s the flip side of what we’re often trying to do,’ and the reaction was, ok, we won’t put it in the statute, but we’ll put it in the legislative history.  Made her a skeptic.  Much more legislative history is like the DMCA than it is a pure record of people striving for the right result.
Kozinski: shares some skepticism—if you want it that way, put it in the statute.  But we want to do what Congress wants us to do.  Nobody wants to spite Congress.  (I could probably suggest a few who do …)
Wood: knowing which is which in legislative intent is not easy.  Especially when you get to analogies—what is a transmission, what can intermediaries do, etc.  We use a lot of hypotheticals to explore the ramifications of our rules, and scholars can help with that. 
Kozinski: Lawyers can too. There’s nothing less helpful than a lawyer who says “that’s not our case” in response to a hypo.  We ask because we understand it’s not your case, but we want to know if your proposed rule will get us into trouble in another case.
Menell: look at some recent fair use cases and how they’d have been analyzed in your circuit.  Cariou v. Prince.  (Good intro to how presentation matters: Menell introduces the case by saying that Cariou’s Yes, Rasta sold for $60, netting him around $8000 for 6 years of his life, while Prince’s work sold for $1 million.  It’s also interesting to think about how physicality matters—the presentation of Cariou’s work side by side with Prince’s in a Powerpoint makes it harder to remember that Prince’s work is very differently sized.)  Prince testified that he didn’t have a meaning or intend to comment on aspects of the initial works—intended to pay homage to other appropriation artists and create beautiful artworks relating to musical, post-apocalyptic themes. His purpose was to include as much “fact” as possible and reduce “the amount of speculation.”  District court emphasized that Cariou may have lost gallery exhibition because gallery owner didn’t want to do something that had already been done.  Second Circuit found most of the Prince works to be fair use as a matter of law, but a few not. Challenged us to ID which one was which.
Andrew Gilden has noted how many amici came in from the modern art community on appeal.  Finds it bizarre that Second Circuit goes on about how many well-known people saw Prince’s art at the gallery, as if that influences fair use.  At some level, the court is saying we have to have a capacious understanding of how art is perceived, but how do we operationalize that?
Q for judges: how would you deal with an appropriation art case?
Kozinski: finds the opinion baffling. 
Wood: when you start talking about reasonable observers, that’s code for an objective test.  But we don’t know what criteria that reasonable person is using to draw the line between the first and second photos—why is X amount of transformation enough?  In TM, our circuit has insisted that it’s mostly not appropriate for a judge to evaluate likely confusion—we want outside evidence.  (Though the amici do seem to provide that.) Maybe that’s what Judge Batts has to do on remand for the 5 possible fair uses.  Partial dissent by a judge who thought that all the paintings should go back.  This case lost sight of why there’s a fair use exception.  Appropriation art: what is it about the structure of the market that would make it difficult to pay a reasonable royalty to Cariou?  Ask him for permission.  Can understand why a critique would be protected by fair use.  Second Circuit has taken leave of its senses in terms of what fair use means.
Kozinski: agrees with Wood.  Raises a more fundamental question: the all or nothing nature of fair use, where you pay nothing or get enjoined.  (Menell notes eBay changes that.)  Means you can take quite a bit without paying anything to the original artist.  Doesn’t see why you should be able to take anything at all without paying something, the amount of which is for negotiation/for the jury.
Wood: the reason that he took it because it was authentic is a little wild.  (I discuss the contradictory treatment of realism/facts in photos in the middle of this article.)
Menell: it was authentic because he spent 6 years cultivating a relationship with his subjects.

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