IPSC part 9: copyright plenary session

Plenary Session
Making Copyright Work for Creative Upstarts
Sean Pager
Imagine you’re a singer in a rock band, and hear your song used unauthorized for a car commercial. You call and they brush you off.  You can’t afford a lawyer, and costs of litigating in federal court could dwarf any license fee you might recover. If you never registered you have no eligibility for statutory damages and attorneys’ fees. You quit and go to law school.
Our standard theory of copyright is that we give rights to incentivize creation, but rights aren’t self executing. Without capacity to use them, they’re not useful. Copyright might not be doing the work it’s supposed to.  Our system assumes sophistication—simple Qs often have convoluted answers, and that’s just the formal law, not the institutions that implement them and have complexities of their own.  Registration alone; signing up for ASCAP/BMI; SoundExchange; Google’s Content ID—a lot of registries to keep track of. 
Broader Q: who is our © system for?  19th c. might have been reasonable to assume that © users were capital-intensive endeavors.  What to do now that creation doesn’t look like that?  Mobile app designers, indie filmmakers, graphic artists—how are they doing in the © system?
What would an upstart-friendly system look like?  Increasing legal certainty—more safe harbors and bright line rules.  Small claims process—better if mandatory.  Enhanced damages tied to registration should be reconsidered.  $35-55 to register is a lot for a graphic artist.  Tech can be used—interoperability, common-sense standards to allow one-stop registration; streamlined online licensing, as w/UK’s Copyright Hub targeted at low-value works to be licensed efficiently using automated mechanisms.  Or expert systems automated to give advice—compare increased ease of tax now that we have TurboTax—similar system for copyright users. (Note that TurboTax has engaged in a lot of funky behavior to prevent tax simplification—a Copyright Hub might do the same, especially if it were a private, profit-seeking organization.)
Menell: Creative upstarts should be able to find works/use Content ID to quickly ID ownership, and on backend streamlining system would be good, but more worried about front end of enabling people to find and navigate.  If they’re not willing to pay $35 to register, should we give them such strong protections for how their works float in the ether.
A: maybe find way to register high volume of works at once.
Lemley: useful points about small creators. Q is what are we to make of the fact that we are nonetheless seeing an unprecedented wave of such creators. We have more video, music, books than ever before, most coming from people outside the © industries. What does that mean? They don’t seem to be quitting and going to law school, whether they should or not.
A: Commercialization—amateurs may create a lot, but don’t invest as much. Making a full length feature film takes resources, while you can write a book on your own.  iPhone filmmakers are limited in what they can do, so we need to find a way to make film pay.
Lemley: sounds like there’s sorting between upstarts and more commercially oriented folks, but those may be more attuned to © system as already exists.
(I agree w/Lemley.  W/r/t the opening story: If most commercializers behave most of the time, though, is that so much worse than other elements of starting your own business?  There is plagiarism of works on Amazon’s self-publishing, but there’s also persistence.  Overconfidence about success is often important in incentivizing creation/starting a business/etc. Is © any different than the other rules that aren’t necessarily enforced (e.g., wage theft)?)
A: there’s a spectrum. Better access to © system may enable you to negotiate better terms.
Q: valid points about accessibility. Is enforcement necessarily the issue? Even in perfect enforcement world, would their captured revenue stream allow people to avoid going to law school?  It could just be that people are flocking to fewer and fewer items—how big is the pie?
A: demand is partly influenced by supply.  Change the system to make it easier for independents to have access—not just ©–people might embrace more products, not just blockbusters.
Q: so the issue is that people aren’t entering the market who otherwise would? Or that they’re entering without being able to recoup value?
A: Soundexchange has $100 million unclaimed royalties—there is money to be had.
Rosenblatt: are creative upstarts any different from other kinds of upstarts? We expect people starting out to do their homework to make a living—get a professional license if they need it, pay taxes. TurboTax is a solution to what we expect from people. 
A: does think tax code should be simplified; does get to whether it’s the gov’ts role to act.  Gov’t may help make TurboTax available to poor people (or better, pre-fill the return like they do in other countries).
Copyright’s Private Ordering: Lessons For Congress
Jennifer Rothman
Congress should largely leave room for private ordering, but sometimes codify uniformly accepted norms and support private ordering/avoid calcification.
Different attempts to address uncertainty in law/uncertainty about fair use: arguments that it’s more predictable than some say, but in individual cases it’s still uncertain so risk-averse people will still license. Campbell is an object lesson in why you should license—district court reversed by court of appeals reversed by Supreme Court, which remanded; ultimately settled with licensing fee—in practice this was a total loss for 2 Live Crew.  She worries about courts interpreting risk aversion as customary licensing practice worth respecting: her favorite example is Ringgold, where a poster was on screen for less than 30 seconds, but court found unfair in part because it bucked an industry custom of licensing set dressing.
We could revise §107 to limit on reliance on customary licensing, use guidelines and alternative licensing.  Not saying that licensing shouldn’t be relevant—availability, feasibility and reasonableness of licensing is relevant. But that’s different from whether people usually license or usually don’t license in an industry.
Use guidelines trying to address uncertainty: the Classroom Guidelines developed after Congress threw up its hands. This didn’t turn out well.  Negotiated by authors and publishers mostly; didn’t include educators, students, or universities; courts have often incorporated them despite their unrepresentativeness and have used them as a ceiling on fair use. We might want to codify some changes: don’t use their violation to determine whether something is fair use; maybe try again with representative group. 
Best Practices largely coming out of AU: valiant effort to push back against clearance culture. Done some important work, but concerned about codifying them as standard in particular industries. Again, they’re not representative of large content owners whose content is most likely to be used. Documentary guidelines can be more limiting than necessary, like not allowing cutting to the beat in incidentally captured music or creating a work around a copyrighted work.
Alternative regimes on top of copyright: Creative Commons—also a reaction to fair use uncertainty.  Allows authors to express what uses they think are appropriate. Maybe we just want Congress to leave this alone—w/exceptions: codify favoring attribution for fair use analysis (maybe even safe harbors); clarify that violation of private contract doesn’t alter analysis of infringement v. fair use. Documentary filmmakers often can’t comply with CC; they shouldn’t be hesitant to make fair use anyway.
Technology/contracts altering ©’s boundaries, technology and DRM—private agreements like Content ID.  We should restrict the ability of tech and private party agreements to eliminate fair use.  © can leave breathing room for private ordering and experimentation, but adopt good ideas.
Other good ideas: faculty ownership of scholarship and course materials, a universally accepted norm that nonetheless seems to run afoul of WFH; maybe attribution should be a requirement; a la carte copyright where you can register and choose to allow, say, educational use.  © can protect against lock-in effect; protect fair use from obsolescence; support fair use.  Clarify whether transformativeness requires content change or just purpose.  Additional safe harbors; limit scope of statutory damages in certain circumstances, esp. where people erroneously predict that use will be fair.
Q: what about webcasting v. streaming in §114?  Private streaming services’ deals—a lot of the terms end up mimicking the terms in webcasting, even the weird performance complement rules; public/private distinction gets blurred.
A: in general there’s a lot of interplay, and there’s not a bright line—operates in the shadow of the law. Warps in response to law; we need what Kozinski was talking about, interplay with courts and legislature.
Gordon: do you have in mind a sort of anti-DMCA: if you use tech improperly we can stop you?
A: Does interplay w/DMCA in gov’t authority.
Q: PTO roundtable suggestion—require tech to leave breathing room for some use of works—e.g., let’s have at least 5 seconds of a work up, not auto takedown even if tech permits.
Secondary Copyright Remedies
Felix Wu
Proposal: Remedies for secondary © infringement should be more limited than remedies for direct infringement, whatever they are.  Statute doesn’t codify secondary liability at any point, leaving no room for judges who expound on secondary liability to provide for different remedies.
Relation to tech innovation.  Why not borrow from patent law?  Patent specifically defines secondary infringement, but the relation between infringement and innovation is different in © and patent. Courts borrowing from patent face a very different context—misborrowing.  In patent, the statute speaks of articles w/ no substantially noninfringing use. It’s not possible for tech to relate to the underlying ©ed work in the same way. What would it mean for something to be specifically adapted to infringe a specific work, as the patent statute requires?  The tech is always capable of processing public domain/authorized works. Taken seriously, there’d be no contributory infringement at all.
That’s not where we’ve gone.  This concept is not a nullity in patent because tech innovation is wrapped up in the primary monopoly we grant to patentee, and orthogonal to primary monopoly we grant to copyright owner.  Thus secondarily liable actor is differently positioned than primarily liable actor.
Second concern: free expression. Protect tech/platforms because of externalities they create. That by itself can’t be enough to protect secondary actors more than primary actors, who also often exercise some kind of speech right.  But the primary actors get benefits that are difficult to transfer to secondary actors—primary actor is willing to take on more risk than secondary actor, since primary actor receives sense of belonging/creativity/community that they can’t monetize and transfer.  Thus externalities will be greater for platform.
Why not an immunity? Might be right in certain circumstances, but not all.  Free expression is at the fore w/r/t §230.  But in © we might be concerned about uncompensated harm/mass infringement.  Platforms could be least-cost avoiders in screening out infringement.  Potential for moral hazard: immunity means incentive to make money off of interest in infringing works. 
What can we do to avoid overdeterrence?  (1) Reduce/eliminate statutory damages for secondary liability. (2) Give restitution/disgorgement but limit their ultimate exposure.  (3) Shift burden of proof from defendants in calculation of damages/profits to avoid overcompensating Ps. May not be possible to show effects of one particular copy, but secondary liability cases are generally large in scope.
Lemley: run away from restitution.  Damages would be worse. You mean disgorgement w/causation.  Too easy in remedies for disgorgement to be all your profits.
May not need statutory change. Statute is silent on remedies for secondary infringement.
A: courts don’t think they’re creating secondary liability out of whole cloth—meaning of what counts as an exclusive right/triggering full panoply of damages. But sees potential. He wants to use profits as a ceiling and shift the burden of proof to avoid that problem with disgorgement.
Q: curious about moving away from patents. If you’re saying anything that could be used to infringe © could be used for public domain works, you’re begging the Q of whether that use is substantial. Is that really different from patent?
A: substantiality is really small in patent—you could use this item as a doorstop = that’s not substantial. Value of use for that purpose is what courts look at. In ©, using it for public domain would have value. 
RT: In terms of why not an immunity: You give three reasons, but none of them seems to differ from §230 to me.  Even w/respect to “mass infringement,” many of the actors that people hate in the §230 context do aggregate gossipy/defamatory content or revenge porn, and most of the visitors are happy to consume lots of different humiliations, which is the business model of those sites.
A: interest in speech is different as between those types of content—© is less speechy.  I know you disagree.

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