Jack Zeal has a really interesting post over on Rick Falkvinge's InfoPolicy site, in which he argues that it's not "our" job to "fix" the broken business model of those who rely on copyright. He talks about having yet another discussion with the typical copyright system supporter, in which they make one of those "but without copyright..." arguments, and he starts pointing out alternative business models. However, he's come to believe that strategy is pointless because, effectively, it's not our job to fix your broken business model. And, to some extent, he's right. It's not our job to do so, but as someone who's been taking part in these discussions for a very long time, and who has spent an awful lot of time and effort highlighting successful new business model opportunities, I still think it's incredibly helpful and useful. I'll explain why by responding to each of Jack's points. To be clear, I don't think Jack's argument is a bad one, and I can understand the frustration, but I still think our focus is more productive long run.

If we propose specifics, we leave ourselves vulnerable to the “but what about A or B? Those couldn’t work with business model C!” It’s an unending cat-and-mouse game. The classic example is the old “How to finance a blockbuster-caliber movie?” trope. Nobody ever considers that maybe the current system is the reason movies have to cost that much, do they?

So? That's always true. People can always bring up a "what if?" and it's easy to then point out that there are similar "what ifs?" with the current system. To be honest, I've often found the "what if" discussions useful in thinking through even more new business model ideas, which is kind of cool.

If we offer generalities, like “Merchandise and sell experiences instead of commodities”, they tend to be shot down in snarky sound-bites, like “So bands will have to sell T-shirts instead of records?”

There are always going to be some people who misunderstand or (more likely) misrepresent your arguments. The "sell lots of t-shirts" trope is so common we used to sell an actual t-shirt that said "looooooooots of t-shirts" on it. And it was a decent seller! Point being: you'll never convince everyone -- especially those who have no interest in being convinced. But, having been at this for a long time, I can assure you that for every person misrepresenting such arguments, there are many others who are recognizing the truth of the opportunities opening up around them. I can't even begin to tell you how many content creators contact me talking about how they used to believe the old party line on copyright (or, more commonly, that they believed there was no hope for making money these days), but that they ended up becoming inspired by reading through some of the many examples of business models that worked.

It keeps the conversation on the content industry’s terms. They can be the “victims” needing a “rescue” strategy. It’s sure a great shift of attention from the rest of society being denied access to information and the natural rights to communicate and share

I'm not sure about this at all. In talking to and working with numerous content creators working through business model challenges, I just don't see this. The discussions about business models are never about "rescuing" anyone -- just straight up brainstorming about cool things that can be done.

It’s needlessly speculative. Indeed, it reminds me a lot of the earliest “home computer” books dumped out by the thousands in the late 1970s and early 1980s. The authors spent hours arguing that we’d all be managing recipies or doing computer-driven teaching, and then VisiCalc happened and people forgot all about recipe-management. No doubt it will be the same. Someone finds the “killer model” for post-monopoly revenue generation, but it’s probably not gonna happen until there’s no other choice but to find one. And much like the cuddly toy in the caption image, some of the suggested models aren’t gonna fly in the real world.

Well, to be clear, we've always said that there isn't a magic bullet business model that works for everyone -- and that the "new business model" involves experimenting with a number of opportunities, much of which depends on the content creator themselves, their audience and the relationship between the two.

So, for us, the highlighting of new business models serves a number of different purposes. First off, it's just plain helpful to lots of artists. And that seems like a good thing. Second, it debunks the claim that copyright is the only business model, which seems to be an implicit (and sometimes explicit) assumption by many, unfortunately. Third, doing so quite often inspires others to try more cool new things themselves. And that can only be a good thing. Much of this is about experimenting and recognizing that there isn't just one way to do things any more. That can be scary and a big challenge for many artists, but it also means that there's tremendous opportunity.

Finally, whether or not it's "our job" to highlight alternative business models, if you don't, none of the claims above go away. People will still attack and complain that there are no business models that work without copyright. A decade ago (after about five years of highlighting problems with the system) I finally started focusing more regularly on highlighting positive examples, and on the whole the experience has been much more beneficial than negative. It's resulted in a lot more interesting conversations with content creators from super stars to kids just starting out -- often leading to cool new experiments and more opportunities. It's also resulted in some really interesting conversations with execs from the legacy industry really looking to help adapt to the changing market. If I was just talking about the problems of copyright, none of that would likely have happened.

A friend of mine who is a successful CEO had a rule at his company, which was that no one was allowed to highlight a problem without also at least tossing out a possible solution, even if it was just to kick off brainstorming. That might be extreme, but it seems like a handy tool. If you're only complaining, it's easier for people to write you off. If you're also highlighting possible solutions, there's a lot of benefit. Also, frankly, it's often a lot of fun to talk about cool things that people are doing.

Here's another patent application to keep an eye on, following on the heels of Microsoft's patent app for a TV that counts noses in order to charge each viewer for content, potentially turning your living room into something akin to a porn store viewing booth or bus stop TV -- "please insert $2 to continue viewing." Verizon's patent application also involves a device eyeballing your living room, this time in an effort to target advertising.

Verizon's living room intruder is a DVR that observes "ambient action," identifies it and scans its ad database for an appropriate ad to serve up during the next commercial break. This sounds about as creepy as an ad exec watching you through your open living room drapes in order to decide which flyers to shove in your mailbox. Rest assured, Verizon's use of the phrase "ambient action" is designed for maximum innocuousness. It's not until you get to the list of possible "ambient actions" that the creep factor really kicks in.

[0016] To illustrate, an exemplary ambient action may include the user eating, exercising, laughing, reading, sleeping, talking, singing, humming, cleaning, playing a musical instrument, performing any other suitable action, and/or engaging in any other physical activity during the presentation of the media content. In certain examples, the ambient action may include an interaction by the user with another user (e.g., another user physically located in the same room as the user). To illustrate, the ambient action may include the user talking to, cuddling with, fighting with, wrestling with, playing a game with, competing with, and/or otherwise interacting with the other user. In further examples, the ambient action may include the user interacting with a separate media content access device (e.g., a media content access device separate from the media content access device presenting the media content). For example, the ambient action may include the user interacting with a mobile device (e.g., a mobile phone device, a tablet computer, a laptop computer, etc.) during the presentation of a media content program by a set-top box (“STB”) device.

It looks as though Verizon has carefully avoided naming any other ambient actions that viewers may not want to have "watched back," like "having sex with," "fighting with," "yelling at," "masturbating to," "Farmvilleing at" or "blogging about." All joking aside, it's a bit disconcerting that Verizon's main concern isn't the potential privacy violations, but rather that its customers just aren't watching TV hard enough.

[T]raditional targeted advertising systems and methods fail to account for one or more ambient actions of a user while the user is experiencing media content using a media content access device. For example, if a user is watching a television program, a traditional targeted advertising system fails to account for what the user is doing (e.g., eating, interacting with another user, sleeping, etc.) while the user is watching the television program. This limits the effectiveness, personalization, and/or adaptability of the targeted advertising.

I suppose that, in this era of "second screens" and "promiscuous 'cuddling' teens," it's tough to get the sort of "captive audience" that advertisers (and the companies that sold customers to them) used to take for granted. The bold, new paradigm is the "observed audience," an innocuous phrasing in itself. The "tracked audience." The "surveilled audience." These terms are a little more accurate, especially considering how much information Verizon covers under the pillow-soft, marketing-friendly, customer-disarming term "ambient."

[0019] Detection facility 104 may be additionally or alternatively configured to analyze data received by way of a detection device in order to obtain information associated with a user, an ambient action of the user, a user's surroundings, and/or any other information obtainable by way of the data. For example, detection facility 104 may analyze the received data utilizing one or more motion capture technologies, motion analysis technologies, gesture recognition technologies, facial recognition technologies, voice recognition technologies, acoustic source localization technologies, and/or any other suitable technologies to detect one or more actions (e.g., movements, motions, gestures, mannerisms, etc.) of the user, a location of the user, a proximity of the user to another user, one or more physical attributes (e.g., size, build, skin color, hair length, facial features, and/or any other suitable physical attributes) of the user, one or more voice attributes (e.g., tone, pitch, inflection, language, accent, amplification, and/or any other suitable voice attributes) associated with the user's voice, one or more physical surroundings of the user (e.g., one or more physical objects proximate to and/or held by the user), and/or any other suitable information associated with the user.

There's also wording in the application regarding recognizing the tune a viewer is humming and reacting accordingly (presumably by contacting the nearest PRO and reporting an unlicensed public performance). It also leaves the option open for detecting other animate and inanimate objects, including pets and branded products. And, like Microsoft's application, Verizon's suggests the system will be able to distinguish between adults and children and activate parental controls.

This being Verizon, the advertising watch-and-push isn't limited to the all-seeing DVR. The user's phone or tablet will most likely be receiving additional advertising or content based on what "ambient actions" are detected. I can only imagine the delighted thrill of customers watching their DVR shove ads onto their phones simply because they weren't paying enough attention to the ad on the TV screen.

Once again, this is nothing more than a patent application, which doesn't necessarily mean this product will ever make it to market, USPTO 'OK' or not. But it does give you some idea of Verizon's theories on where targeted advertising is headed.

I recently heard a story of yet another startup which had been hit by a bogus patent troll lawsuit. As always, it would be cheaper to just settle the lawsuit than to fight it in court, even though they knew that they would win. In this case, the CEO said he was going to fight it anyway because it was "the right thing to do" and to ward off future trolls. That, of course, is the worst part of troll lawsuits: the reason they work so well is that it's cheaper to "lose" and pay the troll than to "win" in court. Obviously, the SHIELD Act looks to change some of that calculus by making trolls have to pay up for bogus lawsuits. However, in general, plenty of startups can tell stories (beyond just patent trolls) in which they "settled" some sort of legal dispute, rather than did what's "right" and to win in court. Frequently, this is driven by the pressures from investors and venture capitalists, who don't want to fund lawsuits but high growth companies.

Of course, many realize that settling or foregoing a legal response in such cases can often make the situation worse, because it attracts more such activity from companies who know they can get away with it. I'm thinking of that after reading this fascinating story by famed venture capitalist, Josh Kopelman, in which he discusses why he and another investor in the startup TechForward financed a lawsuit against Best Buy. You should read the whole thing, but the short version is that Best Buy approached TechForward about using its system to create a "buyback" program. They signed some non-disclosure agreements, leading TechForward to share a bunch of confidential info about their model with Best Buy. Best Buy proceeded to take that info, and then tell TechForward "no thanks." Of course, it came out that the plan all along had been to get access to TechForward's model to build Best Buy's own. Due to the amount of resources (over a year) that went into trying to get the deal, having Best Buy pull it out from under them left TechForward in a bad position, and its assets were sold off. But the VCs kept funding the lawsuit:

Best Buy's last minute actions posed a fatal blow. Techforward sued Best Buy – but it would take a very long time before the case made it through trial. And since Techforward had invested so much money working on the Best Buy deal, the cash position of the company was not looking good. The board ultimately had to make a horrible choice – they sold Techforward's assets to a third party. BUT – they did not sell the lawsuit. Instead, First Round Capital (along with our co-investor, NEA) decided to keep funding the lawsuit. And over the last 18 months, we and NEA gave the lawyers hundreds of thousands of dollars to keep the suit going. This wasn't an easy decision. We are in the business of funding companies – not lawsuits. But my partner, Howard Morgan, was a board member of Techforward – and he sat in those board meetings. And Howard was convinced that Best Buy shouldn't get away with their behavior. We needed to send a message to Best Buy – and every other large company – that they can't blatantly violate agreements and steal ideas from startups. And if big companies believe they can violate agreements with immunity because a startup can't afford to sue them, it is bad news for every startup in the ecosystem.

The end result is that a jury sided with TechForward, awarding it a $22 million award, along with an additional $5 million in punitive damages as response to the action being willful and malicious. The details show that Best Buy employees were pretty blatant about their plan to lead TechForward along, get access to its model, and then copy it. In one email exchange between employees, they even said directly "...remove the Techforward reference in the file names..."

A couple of thoughts on this. It is incredibly rare and surprising to see VCs like Josh and Howard agree to do this kind of thing. I can't recall a single instance of VCs agreeing to fund a lawsuit like this. However, as with the CEO fighting the patent troll, there's an important signalling aspect to this decision. Letting companies know that they can't just rely on VCs not wanting to fund such a lawsuit might lead some big companies to think twice before trying to take advantage of smaller companies. Hopefully more venture capitalists will agree to do similar things.

The second interesting tidbit: this kind of lawsuit got figured out without using a patent. We always hear about how patents are "necessary" to stop big companies from just copying small companies -- but what this showed was that (1) it's not always so easy to copy without more detailed knowledge and access and (2) even if such access is granted, it can be done so conditionally (such as with an NDA, as in this case) allowing for the sharing of information, without having to use a tool like a patent or a copyright. Hopefully more investors will do similar things, recognizing not just the wider social benefit, but in scaring off other companies from either filing bogus lawsuits of their own, or just taking questionable actions towards the companies.

Food scarcity is a real problem in many parts of the world, but in affluent nations, there are different kinds of food limitations. Not being able to find a "cooler ranch" flavored snack and having to settle for "original flavor" is definitely a first world problem. Here are just a few examples of some food shortages from around the world.

• Would you spend about $100 for some Twinkies? Limited-edition baked goods might trump loooots of t-shirts.... [url]
• Illegal hunting in South Africa could endanger large carnivores like cheetahs, lions and leopards. A boom in bushmeat trade threatens the food security of rural communities. [url]
• The American poultry industry has invested a lot of resources to create copious amounts of white meat on various farm-raised birds, but now there's more demand for dark meat. Look out for genetically modified six-legged chickens soon. [url]
• The European Parliament has voted (again) to ban shark finning practices that endanger certain sharks. The EU first passed a ban in 2003, but it left loopholes that allowed for shark finning to continue. Shark fin soup fanatics may need to start looking into the viability of shark farms soon. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post.

Remember the comedy routine that really was a copyright troll court hearing involving notorious copyright troll lawyer John Steele and a bunch of lawyers who all denied representing the plaintiff? We hoped that people would take that transcript and turn it into a movie, and now, apparently, we may have Act II. Ars Technica and Fight Copyright Trolls both have the odd story of a man named Alan Cooper, who just happens to be employed by John Steele... but as a "caretaker" for some property Steele owns in Minnesota. And, well, I'll let his lawyer explain the details:

My client had for several years acted as a caretaker for a Minnesota property owned by an attorney by the name of John Steele. When visiting his property, Steele had on numerous occasions bragged to my client about a plan involving massive copyright legislation in multiple jurisdictions. He also specifically instructed my client to contact him if anyone asked about various corporations, that Cooper was to call him. When Cooper confronted Steele about that, Steele told him not to worry about it. Needless to say, my client was suspicious, but did not know what to make of this situation. Upon learning about the many lawsuits filed by AF Holdings and learning that AF Holdings has a CEO with an identical name he began to investigate further, eventually prompting him to retain counsel.

[...] When investigating this matter and calling the number listed on the wefightpiracy.com website, I confirmed that Steele is currently "of counsel" with Prenda Law. I called and emailed local counsel, Michael Dugas to give notice of representation and find out if there was in fact a different Alan Cooper with AF Holdings. Within an hour of giving notice to Prenda Law and local counsel of my representation, Steele himself called my client several times in a row and asked if he had been talking to attorneys in Minnesota. Because I had not yet heard from from attorneys Dugas or Steele, I looked for an alternative phone number for attorney Dugas and found a different number than the one that appears on the pleading.... Calling that number, I heard a voicemail message which said "Prenda Law." I again left a message, but have received no response. Because I have no response from Dugas or Steele, and because Steele has contacted my client, my suspicious are now increased.

Today, I receved an email from another attorney at Prenda Law, Paul Duffy, suggesting that their client, AF Holdings, probably would not volunteer information. I reasserted my request to confirm that there was another Alan Cooper at AF Holdings. Shortly before sending this letter, Duffy emailed me again and said that I should not contact his office again.

My client would like certainty that his identify is not being used without his knowledge and against his will as the would be CEO of AF Holdings, LLC or as a manager of Ingenuity13, LLC....

This letter was sent to the court on a few different cases involving these companies. In at least one, the judge apparently didn't think this mattered. After saying that it was "reviewed by the court," the judge also said "the court will take no action on this request." In the other cases, the lawyer for AF Holdings, Michael Dugas wrote a response which does not attempt to clarify the situation, but instead basically tells the judge it's false and not to worry about it:

I write to respond to the November 29, 2012 letter filed with the Court by Attorney Paul Godfread. In his letter, Attorney Godfread accuses AF Holdings LLC of being a sham corporation and fraudulently holding his client out as its CEO. Both of these accusations are categorically false.

Attorney Paul Godfread filed an identical letter in a similar case currently pending before the Honorable Judge Joan N. Erickson. In a text entry, the Court indicated it reviewed the letter and “will take no action on [Attorney Godfread’s] request.” Plaintiff respectfully requests that the Court reach similar decision. By way of separate action, Plaintiff will address Attorney Godfread’s egregious behavior.

Note that the letter leaves out the important part. You know, the part where they say that the "Alan Cooper" on these documents is a different Alan Cooper. It seems like that would help settle manners, especially if the initial claims were false.

There's more bad news on the Fourth Amendment front as the appeals court reviewing a lawsuit filed against the US government for illegally spying on American citizens has declined to rehear the Al-Haramain case.

A federal appeals court is refusing to reconsider its August ruling in which it said the federal government may spy on Americans’ communications without warrants and without fear of being sued.

The original decision by a three-judge panel of the 9th U.S. Circuit Court of Appeals this summer reversed the first and only case that successfully challenged President George W. Bush’s once-secret Terrorist Surveillance Program.

Without comment, the San Francisco-based appeals court announced Wednesday that it would not rehear (.pdf) the case again with a larger panel of 11 judges, effectively setting the stage for a Supreme Court showdown. The appeals court Wednesday also made some minor amendments (.pdf) to its August ruling, but the thrust of it was the same as before.

Not only does this mean the plaintiffs will have to take the case to the Supreme Court (if it will hear the case), but it also means the damages awarded ($20,000 each for the two plaintiffs and $2.5 million in legal fees) have been reversed.

This also means the Bush's Terrorist Surveillance Plan will continue unchecked as citizens will be unable to bring suits against the government for warrantless spying. The decision rests on a couple of dubious items: a "missing" sovereign immunity waiver and a document mistakenly sent to the plaintiffs that was later designated a "state secret."

The San Francisco-based appeals court had ruled that when Congress wrote the law regulating eavesdropping on Americans and spies, it never waived sovereign immunity in the section prohibiting targeting Americans without warrants. That means Congress did not allow for aggrieved Americans to sue the government, even if their constitutional rights were violated by the United States breaching its own wiretapping laws...

A lower court judge found in 2010 that two American lawyers’ telephone conversations with their clients in Saudi Arabia were siphoned to the National Security Agency without warrants. The allegations were initially based on a classified document the government accidentally mailed to the former al-Haramain Islamic Foundation lawyers Wendell Belew and Asim Ghafoor.

The document was later declared a state secret, removed from the long-running lawsuit and has never been made public.

Concern about the government's ability to designate nearly anything as a "state secret" in order to prevent the release or use of possibly damning evidence has already been discussed by the Supreme Court during oral arguments in the Clapper v. Amnesty International case. In this case, the belated "state secret" designation effectively limited the plaintiffs to citing circumstantial evidence, which is far less effective than producing an actual document showing that the NSA was doing exactly what the plaintiffs claimed it was.

Between the "sovereign immunity" that is unlikely to ever be waived and the ability to designate damning evidence post-facto as "state secrets," the NSA has set itself up with the ability to run a constitutionally dubious, but legally sound, domestic spying program. The system of checks and balances our nation was formed on now more closely resembles a series of erected walls protecting government agencies from being held accountable for their actions.

Not this again. Nearly three years ago, we wrote about the growing hype around "cyberwar" in the US government -- much of it being pushed by one Michael McConnell. News reports love to cover McConnell's fear-mongering about how the internet is at risk. He used to always talk about "cyberwar" but that term went out of fashion, so lately it's all "cyberattacks" and "cyberterrorism." The reason the press loves McConnell is that he's a former head of the NSA (under Clinton) and director of national intelligence (under George W. Bush). What those reports don't like to mention is that since leaving the government, McConnell has a very cushy job as Vice Chairman of Booz, Allen, Hamilton. Booz Allen is a company that regularly seems to do $100 million+ deals with government agencies, many of them related to cybersecurity. You think that having a former NSA director running around scaring agencies about how they're at risk of "cyberwar" or "cybersecurity" isn't useful for business?

And yet, it seems that time and time again when we see McConnell's name, reporters completely fail to mention this particular conflict of interest. Instead, they report his claims as if they're fact, despite the much simpler and more obvious fact: no one has died from an internet attack. Ever. None. Zero. Zilch.

Take, for example, this News.com article by Steven Musil. And then let me know where either of these points is made. You can't, because they're not in there. McConnell's connection to Booz isn't mentioned. Nor is the fact that "cyberthreats" are still as dangerous as a ghost story.

Instead, he throws in a couple scary scary quotes from McConnell about how we're getting close to a cyber-9/11 or a cyber-Pearl Harbor without pointing out that plenty of people think such claims are completely overblown. Also, we've been hearing about this for years now, and while it's been quite profitable for McConnell, there's been no evidence that such a threat is really any closer. But, boy does it make money for government contractors. This isn't to pick on Musil in particular -- plenty of reporters seem totally taken in by McConnell's old job and seem to throw any skepticism (or the ability to do a basic Google search about his current job) out the window. But if we keep seeing it, we're going to keep calling it out until people realize that maybe there are motives there beyond what McConnell says.

It's not surprising that a year-old proceeding launched by the U.S. Copyright Office, toying with the idea of creating a copyright-focused small claims court, has gone largely unnoticed. Private meetings in Dubai about the future of the internet, and copyright proposals in Germany that could change the way search engines work have been vying for people's attention around the same time.

However, about a week ago, a small number of rights holders organizations, attorneys, and artists were invited by the Copyright Office for panels at Columbia & UCLA's law schools to debate the details of what a copyright small claims court should look like.

Here's some context about why these details are so important: if some of the more short-sighted special interests monopolize how these proceedings go, it could lead to a situation worse than bogus DMCA takedowns. Right now, internet users have to worry about abuses of the DMCA that lead to content takedowns; imagine adding to that a situation where it's even easier to have them bullied and brought into a real courtroom.

If this court is shaped without your input, we could be faced with a situation where it makes economic sense for media companies to sue many more average internet users over the photos they post on Facebook and Tumblr. The tens of thousands of Bittorrent filesharing lawsuits over the last two years might pale in comparison.

Even though it's a ways off from completion, a small claims system for copyright would have a bigger impact on the day-to-day of copyright law than any "reform" to copyright since the DMCA in the late 1990's, so we should pay attention.

Who wants a small claims copyright system, and why?

Some rightsholders say formal copyright lawsuits in the current system are too expensive. Evidence from the ABA IP law section shows that federal copyright trials are expensive (pdf), with cases where less than $1 million is at issue costing an average of over $200,000 in legal fees before trial, and nearly $350,000 once they've gone through to an appeal.

So the argument from some rightsholders is that it simply isn't practical to bring legitimate smaller disputes. This argument says that while attorneys fees and costs are available if you've registered your work, many smaller disputes involve unregistered works and fees and costs are unavailable..

The ABA's comments tried to give a sense of where the line is for attorneys to actually bring a federal lawsuit.

Approximately one-third of the respondents would turn away a copyright case where the likely recovery would be less than $60,000. But about two-thirds of the respondents would accept an uncomplicated case with a likely recovery of less than $60,000. Only about one-third of respondents would accept an uncomplicated case with a likely recovery of less than $30,000.

In short, some rightsholders want a new forum to bring suits against small-scale defendants.

What is the practical impact of a small claims copyright court?

The organization I direct, New Media Rights, provides one-to-one legal services to all kinds of folks who would end up being both defendants and plaintiffs in the new system. Why we're participating so extensively is because we're in a unique position: we're (1) a user-oriented organization (for example, defending innocent internet-users who are wrongly implicated in filesharing cases). BUT we're also an organization for (2) independent creators: the type of people who make their livelihood by sharing their creativity online.

We see a lot of the bullying and trolling that takes place in the informal copyright system, where overreaching DMCA takedown notices and cease and desist letters are common. As many people reading this may know, bogus copyright claims are regularly misused to takedown otherwise legal content.

So we have to balance the need of independent creative people to get “justice” for their works being wholly misappropriated by bad actors, while keeping life sane for average internet users. These are some of the details that I shared with the Copyright Office to balance those interests...

How to keep a new small claims system fair?

1. Defendants need to have access to all defenses normally available to them including the fair use and DMCA safe harbor defenses. At least one misplaced comment suggested getting rid of the DMCA safe harbor all together and raising statutory damages to $650,000 (from $150,000).

2. Any small claims system will need to address current misuse of copyright law. Threats of lawsuits and settlement demands from copyright trolls are a big problem. Currently, because this abuse takes place outside the formal court system, there are few consequences for the troll. Our suggestions highlight the need to keep trolls out while allowing legitimate cases to go forward.

3. Defendants have to have adequate legal representation. Plaintiffs will have had months to prepare a complaint and consult attorneys. A small-scale defendant will have limited time and resources to figure out how to defend themselves. Small defendants without adequate representation shouldn’t simply get steamrolled or coerced into settlements by overreaching copyright owners (example: The mass filesharing lawsuits of the last two years).

Self-help systems like FLASH in Northern California, and legal assistance projects like New Media Rights in San Diego, provide help for these types of people. BUT as the Executive Director of New Media Rights, I can tell you that we don't have even 1% of the capacity to deal with and correct all of the misuses of copyright law that we see.

4. Defendants need to have access to fees and costs. Under section 505 of the Copyright Act, a court is permitted to award fees and costs to the prevailing party. Despite the Supreme Court's finding in the early 1990's in the Fogerty case that the standard is the same for plaintiffs and defendants, plaintiffs regularly get fees simply by registering while defendants have to show the plaintiff's lawsuit was in bad faith and frivolous. The result is a disincentive for defendants to challenge copyright holders, and an incentive for innocent defendants to settle. This is because even if a defendant wins in federal court, they will still likely have to pick up the tab for attorneys fees.

Why this is important and what you can do

Even though the small copyright claims discussion is speculative, making it difficult to simply be for or against it, it definitely isn't a discussion that should be ignored.

Internet users need to stay involved with the proceeding and make sure the new system is something more than a new venue for porn companies to coerce settlements out of internet subscribers. For now, the best thing we can do as internet users is raise awareness and be involved, so that by the time a full proposal is on the table at the Copyright Office, it includes safeguards that will make sure the new court provides a fair playing field.

Earlier this week, we wrote about how the ITU had secretly approved a standard for deep packet inspection behind closed doors. This was troubling on a number of different levels, including the idea that they're even trying to standardize such a thing, and that they're doing so in secret. However, after the news came out, Asher Wolf decided to tweet a simple question, asking if anyone had access to documents about the DPI standard. And a funny thing happened: Toby Johnson, a PR/communications guy for the ITU, responded and offered to send the documents. Which he did. And then, five hours later, after Asher had spoken about them publicly and sent them around to a bunch of journalists, she got an email saying that the documents were for her eyes only, and not to publish or share them "in part or in whole."

Yes, the ITU is so incompetent that they can't even do secrecy right.

Richard Chirgwin has a pretty good rundown on how ridiculous the DPI standard is, but perhaps more bizarre, as Wolf points out, the documents show that the ITU didn't think it was worth studying the impact of such a standard before implementing one -- which would suggest (yet again) that the ITU appears to go about things backwards.

About a year and a half ago, we wrote what we thought was just a fun theoretical post about copyrights in tattoos. The general point was that if a tattoo artist creates a new and unique design, then, technically, they're the one who gets the copyright. And that can lead to some awkward legal issues. Of course, it barely took three weeks before that "theoretical" question became real, when a tattoo artist who had done Mike Tyson's famous tattoo sued Warner Bros. because the character Ed Helms plays in The Hangover 2 ends up with a similar (though not identical) tattoo. WB eventually settled that case to make it go away.

As a bunch of folks have sent in the news that tattoo artist Christopher Escobedo has sued video game company THQ because they accurately depicted UFC fighter Carlos Condit in the game UFC Undisputed 2010. Condit has a prominent "lion" tattoo which is replicated in the game. You can see the tattoo here: None of the news reports we've seen have posted the actual legal filing, so we've posted it here and embedded it below. There are a few things worth noting. The game came out in 2010. Escobedo created the tattoo in 2009... but did not register it until February 24, 2012. That may significantly limit Escobedo's ability to collect. Specifically, if you want to ask for statutory damages (up to $150,000), registration has to occur within 3 months of the work being published and prior to infringement. In this case, neither happened -- which is why Escobedo is asking only for "actual damages." And that's going to make this case difficult for him. He's claiming that he wouldn't have licensed the image, which is how he's going to argue for really high damages, but a court might not buy any real or significant "damage" to the copyright being used in the game.

Honestly, much of this feels like the artist is using this more as a way to get publicity, rather than as a way to win a lawsuit. After all, the lawsuit got attention... because the artist issued his own press release about it. That press release mentions the Mike Tyson tattoo case, suggesting that some people saw that and started looking for other opportunities to use tattoo cases to sue big companies, hoping for easy settlements.

Sites that share unauthorized copies of various kinds of digital files are hardly news, and neither are attempts to shut them down. But a recent case in Italy breaks fresh ground here:

The Milan public prosecutor has ordered the seizure of assets of the Avaxhome "digital newsstand", a portal for "sharing" newspapers, books, comics and music DVDs. The claim of receiving stolen goods against the site was validated by the investigating magistrate in Milan after a complaint by Italian publishing group Mondadori in June. The website is based in Russia, and Italian ISPs have now blocked access to the site.

Since the site is based in Russia, seizing its assets might prove tricky. But what makes this decision important is the fact that the public prosecutor in Milan has gone beyond finding that the site infringes on copyright, and deemed it to be "receiving stolen goods" -- a far more serious charge.

As Fulvio Sarzana, the author of the blog post quoted above and lawyer for the Italian ISP association, explains (original in Italian):

"This seizure is a serious problem because for the first time in Italy and in the world putting copies of articles on the Web is considered to be receiving stolen property and not only infringement of copyright." According to the lawyer, "the risk is that from now on anyone whoever puts copies of articles on the Web will see their site closed and be on the receiving end of a charge that equates this case to that of a car thief."

Sarzana says that the Italian ISP association will appeal, so it's not certain that this dangerous equivalence will stand. But it's a worrying prospect that copyright infringement might be routinely equated to theft in this way, since the two are completely different for reasons that have been discussed many times here on Techdirt.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Update: The account is now unblocked, with this message from Facebook:

I'm so sorry for the inconvenience caused, there was a temporary misconfiguration in our photo review systems which caused a very small subset of users to be incorrectly enrolled in one of our checkpoints. There was no issue with your original photo, we have a combination of automated and human-review systems dedicated to keeping people safe, and a bug caused one of these systems to incorrectly enroll a small number of users into checkpoints.

We have since remedied the issue, and remediated all affected accounts. Please let me know if you or others are still experiencing any difficulties.

Yesterday I posted this adorable photo on Facebook:

Being a cute picture of a cute cat, it got a lot of "likes" and comments. A few hours later I followed up with this photo (accompanying text in the caption):

Another photo of Nut and me. Here you can see in more detail how Nut presses her face as hard as she can into mine. She does this all night, by the way. If I move my face away, she rearranges herself to grip the back of my head as tightly as possible. If I'm face-down on the pillow, she slides her paws under into my eye sockets and mashes her head into my ear. It's very cute but I don't think I could stand it every night.

Shortly thereafter, FB wouldn't let me view my feed, instead giving me this message:

"We noticed you may be posting photos that violate our Community Standards. Help make Facebook better by cleaning up your photos and removing friends that post nudity or other things that violate our standards."

Then it took me directly to all my photos and said,

"To keep your account active, please remove any photos that contain nudity or sexually inappropriate content. Check the box next to each photo you need to remove."

I didn't have a single dirty photo to check, so I checked none and then clicked the box that said, "I have checked all my photos that violate Facebook’s policies." For that, I was rewarded with this:

"Because you uploaded photos that violate our policies, you won't be able to upload photos for 3 days.

"If you have other photos on the site that violate our policies, be sure to remove them immediately or you could be blocked for longer. After this block is lifted, please make sure any photos you upload follow Facebook’s Policies."

Followed by another checkbox that says,

"I understand Facebook's policies and I won't upload any photos that violate these policies."

But I haven't checked that box yet, because I really don't understand Facebook's policies. At all. Maybe Franz Kafka could explain them to me. Can you?

UPDATE: several hours later, I still can’t see my FB home page/news feed. This is what I continue to get instead:

Sega has a history of being less than friendly to their fans and customers. Recall that they were unable to respond to one customer's concerns about SOPA, other than to ramble on about reboots and hard resets. Then there was their DRM fiasco when an iteration of their popular Football Manager franchise had DRM every bit as functional and effective as Congress.

Pictured: Constitutional DRM
Image source: CC BY 2.0

Well, Sega has apparently decided to buck their trend of being mildly annoying to their fans... by upping the ante and going full-blown fan-screw-crazy. They have apparently been going on a YouTube video take down blitz for anything related to their Shining Force franchise to somehow protect an upcoming PSP release in the series from being... well... maybe they think that... no, that doesn't work... you know what? I don't know what the hell they're afraid of, but they're pooping all over a bunch of fan videos.

Many YouTube channels have already been hit, including that of popular game critic TotalBiscuit, who has since removed all Sega content from his page out of disgust. No type of content was spared -- Let's Plays, walkthroughs, and random gameplay clips all got flagged. Hell, even videos of fans just talking about the Shining series with no accompanying game footage whatsoever are apparently copyright violations!

If you've spent ten seconds searching for any game on YouTube, you know that the plethora of fan videos, playthroughs, and Let's Plays are more abundant than gold rings in a Sonic game. And if the rest of the gaming world is anything like me, and there's a frighteningly good chance that it is, they use those kinds of things to either influence whether they purchase a game or not or to enhance their gaming experience via the walkthroughs. Either way, Sega, yanking those videos offline in some misguided attempt to avoid confusion with a new upcoming game (because everyone knows how easily fooled the rabid fanbase of an RPG franchise is), can only cause anger in established fans/customers and ward off purchases by potential customers who can no longer get a glimpse of what they would be buying.

At this point, I would usually make some kind of grand statement mixed with a little vulgarity to wrap all this up into a fine point, but the afore linked Destructoid does it as well or better than I could, so I'll give them the final word:

Remember earlier this year when the Internet took a stand against SOPA / PIPA? This was the kind of nonsense we were fighting against. This is unbelievably bad form. It makes no sense either, because why are just the Saturn Shining games catching most of the heat? Why isn't Sega going after the whole pie? If you are going to be a dick, don't stop in mid-f*ck.

The NY Times, of course, was the newspaper central to the case of the Pentagon Papers. That involved a huge dump of information concerning a Pentagon study highlighting how the Johnson Administration had lied to the public and Congress concerning Vietnam. The papers were leaked to the NYT by Daniel Ellsberg. The Times proceeded to release excerpts of it along with some reporting, and eventually the entire set of documents was released publicly. Ellsberg was charged under the Espionage Act -- though eventually all the charges against him were dismissed, in part due to "gross governmental misconduct." The NYTimes was hit with an injunction against publication, and a legal fight ensued, which the NY Times eventually won. There are, of course, significant similarities with Wikileaks. Again, we're talking about a large amount of classified government documents, highlighting lies to the public by the administration, and which were leaked to Wikileaks by Bradley Manning. The documents were, at first, released in excerpts along with some reporting, and eventually the entire set of documents was released publicly. Manning has been arrested and is awaiting trial.

There have been some ongoing hearings, many of which we've covered, but some folks have noticed an oddity. The New York Times did not send a reporter. It merely ran a single AP wire story. Thankfully, the NY Times' own public editor is scolding the paper for its failure here, noting that no matter what you think of Manning or the whole Wikileaks issue:

The testimony is dramatic and the overarching issues are important.

The Times should be there.

The excuse from NYT Washington bureau chief David Leonhardt seems especially weak. Basically, saying there just isn't that much to the story:

We’ve covered him and will continue to do so. But as with any other legal case, we won’t cover every single proceeding. In this case, doing so would have involved multiple days of a reporter’s time, for a relatively straightforward story.

Apparently, when it's someone else, rather than the NY Times itself... it's just a "relatively straightforward story" not worth a reporter's time.

A few months back, we covered the story of Mike Tracy, a highly regarded animator with over a decade of teaching experience at the Art Institute of California. Tracy protested his school's mandatory ebook policy, one that saddled students with one-time use ebooks (via access codes) at a cost of $50-75 each. The push behind this policy came from the Education Management Corporation (EDMC), which manages several for-profit universities as well as operating its own e-textbook publishing company, Digital Bookshelf.

Mike Tracy refused to enforce the questionable policy and spoke out openly against EDMC's mandatory e-book policy, calling the forced inclusion of these textbooks "arbitrary, inappropriate and completely motivated by profit." In response, the Art Institute fired Tracy for "insubordination." It may be wishing it had simply made a few exceptions or reconsidered its textbook policies, as it is now being sued, along with EDMC, for lost wages and benefits, along with punitive damages for retaliation, wrongful termination and emotional distress.

Tracy, who had taught for 11-1/2 years at the Art Institute without requiring his students purchase a textbook, was informed by administration in 2010 that he would need to select a textbook from the list provided by EDMC, something that had never been required before this point.

"Plaintiff was concerned by this notification that his course had been selected for compulsory participation in defendants' e-book program," the complaint states.

"Plaintiff had taught the course for more than a decade without the use of an officially published textbook. Plaintiff had never previously designated a textbook for the course because, in the rapidly and ever-evolving field of digital animation, which increasingly relied on cutting-edge technical developments in the larger field of computers and computer science, no published textbook adequately addressed the subject matter of the course. Available published textbooks often suffered from a lack of comprehensive teaching of the subject matter; a failure to remain relevant, containing out-of-date materials, techniques, or approaches, due to rapid and continuous developments in the field; or a failure to provide practical and/or theoretical educational content that would adequately prepare students for careers in the field. Thus, in plaintiff's professional and academic opinion, none of the available published textbooks for the course were productive, useful, or appropriate for the students."

That's the trouble with policies: they can often override knowledge and/or common sense. Seeing as Tracy had more than 11 years experience at that point (and was respected by his students, who collected more than 4,700 signatures on a petition to get him reinstated), one would think the school would value his opinion over a list compiled by a management corporation more interested in turning students into mandatory "customers" than actually providing quality education. Tracy's concern about this new policy led him to do some research, which uncovered some more mercenary ugliness on EDMC's part.

Tracy says he found that students taking courses requiring an e-book were charged $50 for an "electronic resources fee," and $75 if the course required two e-books.

"Students were not allowed to opt out of the automatic fee, which was charged to their tuition accounts without further notice," the complaint states.

Tracy claims this policy prevents students from buying their books elsewhere, a right guaranteed in the student handbook.

"Moreover, the policy effectively eliminated all other potential ways that students traditionally saved money on text purchases, such as buying used texts or trading texts after completing a course, because access to the mandatory e-books was limited to the particular student charged, in a single-use only basis."

Mandatory fees plus elimination of used books sales. It's a nice racket if you can get in on it. Tracy claims most students were unaware they were being charged these mandatory fees and that other instructors felt the e-textbooks were unsuitable for their classes and never used the "provided" texts which, oddly, worked out perfectly for EDMC and the Art Institute.

"More disconcerting still, plaintiff discovered that if the student never logged on and activated the e-book account for the course, defendants retained a higher percentage of the profit from the sale of the e-book under the terms of their contract with the e-book publisher than if the student had actually activated and made use of the e-book account," the complaint states.

That's just bizarre. As a digital product, prices shouldn't fluctuate depending on actual "use" of the texts. If this is true, it's as though the intention was to push as many useless and needlessly expensive e-textbooks on students as possible in hopes of a greater "return" of "unused" textbooks. Beyond some minor account maintenance, it's hard to see many expenses being incurred by the use of e-textbooks, which makes the higher profit margin on unused "books" inexplicable.

Tracy filed complaints with several government agencies, including the Department of Education. On August 10, 2010, Tracy was threatened with firing unless he complied with the new policy.

"During the meeting, plaintiff, again, reiterated his concerns about defendants' e-book policy, including explaining his belief that it resulted in falsely or fraudulently utilizing federal and state funds (by way of the government-provided grants and loans to the students) through an unfair pricing scheme for the e-books, from which students were unable to opt out. Plaintiff stated that he believed the letter threatening his termination was a retaliatory attempt by defendants to silence his opposition to the e-book policy and to deter other faculty from coming forward and voicing opposition to the same. Plaintiff also believed the termination threat was a signal to him and his colleagues that defendants would not tolerate any type of questioning of their policies, without regard for whether these policies were in violation of the law and fair and ethical business practices," the complaint states.

Tracy suggested alternatives to the new policy but they were rejected. Believing that his firing was imminent, he posted a message on his personal Facebook account regarding the situation, thanking his students and colleagues for the time they spent together during his career. This apparently was too much for the Art Institute to take.

Four days after the meeting, the Art Institute fired him, "mischaracterizing his continued opposition to their e-book policy on the grounds that it was unlawful, unfair, and unethical as 'insubordination,'" Tracy says in the complaint.

He claims the school retaliated against him for objecting to its unlawful e-book program, refusing to participate in the program, and reporting the program to the government.

While we wait for this to play out, there are a couple of issues to keep an eye on. Considering EDMC's past legal issues (it's currently being sued by the Department of Justice for illegal recruiting and false claims) and it's possible violation of the Higher Education Opportunity Act (which states that textbook publishers must unbundle their core educational content from optional add-ons like study guides, homework systems and, possibly, mandatory electronic versions of textbooks), Mike Tracy could end up with a rather swift settlement should EDMC wish to remain out of the judicial limelight.

While this lawsuit is not directly about textbook publishing or for-profit schools, it does serve the purpose of shining some sunlight on the intertwined workings of businesses like EDMC, which both owns and supplies textbooks to its colleges. This limitation of options, and the reliance on accounts, passwords and one-time use e-textbooks, prevents students and instructors from choosing anything but the most profitable (for the management and administration) path.

Exposing EDMC's "policies" for what they are -- the building blocks of closed ecosystem -- will hopefully help steer future students away from post-secondary for-profit schools run by the corporation. As for Tracy, hopefully the suit goes his way and, at the very least, he ends up at a school that appreciates his talents.

The US Patriot Act has suddenly scared an entire nation, and it's not the US itself this time. The Netherlands is currently going nuts about the US government being able to request medical details of all its citizens when the Dutch Electronic Patient Database (EPD) is implemented next month. This will not be the only country that freaks out because of the Patriot Act, as this sort of thing is likely to happen a lot more often. A recent study explained that US government agencies can secretly request anyone's data if they are using a cloud-computing service which 'conducts systematic business in the US'. It is already sufficient when the service provider is somehow a subsidiary of a US company.

That turns out to be a problem in the Netherlands, because the company that has developed the EPD and will be hosting the patients' data on its cloud computing systems is the US-based CSC. The Dutch government and the organization responsible for implementing the EPD are convinced there is no problem, because there are clear contracts which have assigned Dutch jurisdiction, and fortunately the Dutch have stringent data protection laws that will protect patients' sensitive data. Because that's what data protection laws do, right?

False! At least with regard to information law, researchers from Amsterdam University warn that this analysis is way too simplistic. According to the scholars, it is quite possible the US government agencies can circumvent data protection laws and could easily request access to medical information of every single person in the Netherlands. The study doesn't just cover the Netherlands (though it is especially timely for that), but rather looks at how these risks may apply more globally. Here are just a few of the findings that should raise eyebrows across the globe:

"When using a cloud service provider that is subject to U.S. jurisdiction, data may be requested directly from the company in question in the United States. […] From a legal point of view, access to such information cannot be denied and cloud service providers can give no guarantees in this respect. […] The possibility that foreign governments request information is a risk that cannot be eliminated by contractual guarantees. Nor do Dutch privacy laws offer any safeguards in this respect. […] It is a persistent misconception that U.S. jurisdiction does not apply if the data government requests for information do not apply to Dutch users of the cloud. […] legal protection under specific U.S. laws applies primarily to U.S. citizens and residents. […] Given the nature of intelligence work, it is not possible to gain insight into actual requests for information by the U.S. authorities […] Cloud providers will typically not be able to disclose whether such requests are made"

If the above doesn't yet lead to a new international outrage against the US Patriot Act, then the following sentence on the extra-territorial effects of the Patriot Act should at least send shivers down the spines of sovereignty-loving non-US government officials:

"The transition to cloud computing will, in principle, result in a lower degree of autonomy [...]"