Here's a quick rundown on some upcoming events I'm involved in, leading off with a very exciting keynote brainstorming workshop at the INNOVATE / ACTIVATE conference in Berkeley on April 21st. As some of you know, we've run a bunch of brainstorming workshops either at our own events or as part of other events (as we're doing here). In this case, we'll be doing a brainstorming workshop around the question of "What does a proactive intellectual property agenda mean?" This is a question that has received a lot of attention over the past few months, since the SOPA fight. Lots of people who were involved in that battle came out of it wanting to do something positive to move the debates about IP towards fixing the problems associated with it, rather than just reacting defensively to efforts to expand a broken system. So we're going to brainstorm some ideas. The session will kick off with three (very) brief talks to get people thinking out of the box -- one by Nicole Ozer from the ACLU, one by Mike McGeary from Engine Advocacy, and one by me. From there, everyone will go into breakout groups with a specific brainstorming task for an hour, and then we'll regroup and discuss what the different groups came up with. These events are always thought-provoking and a lot of fun. I'd suggest coming to check it out, but I've been told that the event is already sold out.

Separately, this coming week, I'll be in Belgium on Wednesday, April 11th, taking part in a stakeholder hearing about ACTA at the European Parliament (which looks like it will be streamed live online). Two days later, I'll be in London, where I'll be hosting a discussion with Coadec talking about our recent Sky is Rising report (and I'm sure I'll also be discussing other policy/tech/business model issues as well). If you're unfamiliar with Coadec, it's a wonderful, UK-based organization, focused on helping the innovation community get involved and engaged in policy issues in the UK. That one is free and open to the public, so please come and join us. It should be a lot of fun.

Italy only established patents for pharmaceuticals in 1978. Prior to that, it had a thriving pharmaceutical business with a ton of companies. The country was a net exporter of drugs. While many of the firms there did focus on making generics, there was significant drug discovery and R&D happening in Italy at the time as well. However, due in large part to pressure from the big international pharmaceutical firms, Italy eventually established patent protection for drugs as well. Following that, there was massive consolidation in the Italian pharmaceutical market. The country went from being a leader to just another player, and the big international pharma companies took over and to this day dominate the Italian market.

That's a bit of interesting background for the fact that the Italian antitrust authority recently found drug giant Pfizer guilty of abusing antitrust law in the country to try to delay or block competition from generic drugs. According to the report linked here, Pfizer was specifically called out on two points:

1. the artificial extension of the Xalatan patent in Italy by means of: a) the application of a divisional patent; b) the validation of the divisional patent in Italy; c) the application for an SPC in Italy; d) the application for pediatric extension; and

2. the start of litigations aimed at discouraging or increasing the costs for the marketing of latanoprost generic products in Italy.

Pfizer is expected to appeal, and the blog post linked here (from law firm DLA Piper) suggests that it has a decent chance of having the original ruling reversed. But, really, that's quite a change in just a few decades. From being a leader in the market -- often by building on the ability to produce generics -- to one where cheaper generics (which help keep people healthy in a more affordable way) are aggressively blocked from the market by activities of giant multinational pharma companies.

There have been proposals to stop minting the US penny for decades, but the little copper-colored coins are simply too beloved to remove from circulation. Rounding to the nearest nickel also probably rubs people the wrong way, but it seems like Canadians are going to find out how that works. Here are just a few other interesting articles on coins.

• Recently, Canada has killed its penny -- which cost more to mint than it was actually worth. In the US, it costs more to mint both pennies AND nickels, but it doesn't look like we're going to stop making them. [url]
• It's been difficult to get Americans to use dollar coins over paper bills. Dollar coins last longer and are cheaper to produce in the long run, but the Fed has just accumulated a collection of about 1.4 billion unused dollar coins that it's just storing in a vault. [url]
• Canada currently mints a $100,000 gold coin that weighs 10kg, but that's nothing compared to the proposal that the US treasury could mint a trillion dollar coin. A coin worth a trillion bucks was a crazy idea for solving the US debt crisis last year because there's no statutory limit on the amount of coinage the Fed can produce (while there is a limit on paper currency). [url]
• To discover more stuff on economics, check out what's currently floating around the StumbleUpon universe. [url]  

As always, StumbleUpon can also recommend some good Techdirt articles, too.

The Dutch anti-piracy group BREIN is somewhat famous for its overreaching efforts. While it succeeded in getting ISPs to block The Pirate Bay's website, it's been going after a bunch of proxy sites that have helped people get around the block. Its latest move may run into some difficulty however. The Dutch Pirate Party has its own proxy offering, and BREIN is demanding they turn it off. The Pirate Party, however, is standing its ground. As TorrentFreak reports:

Last week the local Pirate Party also received a letter from BREIN, demanding the shutdown of their Pirate Bay proxy site hosted at tpb.piratenpartij.nl. However, unlike the site owners that were previously contacted by the group, the Pirate Party is not caving in. They would rather fight the case in court.

Today the Party informed BREIN that the proxy site will stay online. To show that The Pirate Bay can be a useful communication tool the Pirate Party sent the letter through a torrent file, hosted on the BitTorrent site at the center of the dispute.

“The demands are ridiculous,” Pirate Party chairman Dirk Poot told TorrentFreak.

“A private lobbying organization should not be allowed to be the censor of the Dutch internet. We were also amazed to find an ex-parte decision attached, threatening Dutch minors with €1000 per day fines for operating their proxy. If we would have yielded, their trick would immediately be played out against numerous other private citizens.”

The larger point in all of this, of course, is just how completely and utterly useless BREIN's game of whac-a-mole is. There are so many proxy sites out there, and many are used for perfectly legitimate reasons. Trying to block every single one of them is a fool's errand. Those who want to go to TPB will figure out ways to get there.

As promised, here is our discussion with Rebecca MacKinnon, the author of Consent of the Networked, a fascinating book about the fine balance online today between the ability to use the internet for amazingly positive activism... as well as the threats of those who seek to control and limit the internet to prevent those kinds of actions. Rebecca was kind enough to answer some of the questions brought up in the discussion space at our Step2 platform, and we're reposting the Q&A here for folks to discuss below:

Could users push for change on their own or would it need to be an effort including governments and positive examples from industry?

It depends on what "change" you're specifically talking about. If it's a bad law (like SOPA) that industry doesn't like either, then you can have alliances between users and companies against government stupidity or evilness. Other times companies do bad things - like violate users' privacy - and users ask government to help rein them in (or at least some do - people are divided about whether government involvement is more productive or counterproductive). Sometimes you have situations where government and companies are colluding together against users, customers, and citizens.

The point is that we need a wide and diverse global movement for Internet freedom, rights and liberties. I draw a parallel from the environmental and labor movements. The only reason companies ever do the right thing when it comes to environmental and labor practices is due to massive global movements through which people exacted costs on companies for bad behavior in their various roles as consumers, investors, voters, and activists. It's not that they are perfect by any means but decades of activism on all fronts has undeniably brought real improvements if you compare the situation to 50 years ago.

Similarly the only reason why government gets it right on policies and laws related to the environment or anything related to civil liberties for that matter is thanks to long-standing citizen activism. Politicians and CEO's don't just wake up one day and decide to do the right thing. They generally do the right thing because they fear that the public will make them pay one way or another if they don't. The public currently isn't exacting sufficiently high costs on companies and governments when they violate our digital rights and liberties. We need to start making it clearer that we're serious, and find more effective ways to make that clear.

Which projects do you think have the most potential for expanding the digital commons?

I've listed quite a number in the "get involved" section of my book's website. I'm inclined to think that having a robust digital commons requires a diverse ecosystem of many large and small projects and initiatives all over the world rather than one or two massive centralized uber-projects.

What major events have occured since you published that you wished you could have included? Is there anything in the book that you might change in a next edition?

I used a fairly traditional old-school publisher so the text was really finalized in August 2011. A lot happened between then and the book's release on February 1st. The biggest event was the anti-SOPA fight, of course. I will definitely include an update about that and probably also the nasty cybersecurity bills Congress is considering. Things happen every day that relate to the book.

The point of the book, though, was not to have an up-to-the-minute account of everything - that's what blogs and articles are for. The point was to make a broader conceptual argument about trends and problems, and what we need to do about them. I think my broader argument and framing of the problems we face has held up pretty well. Another point worth making is that this book wasn't actually written with the typical reader of tech blogs in mind. It was written for people who rarely read anything about tech other than what shows up in MSM, who may have never read an "Internet book" before, but who care about the future of democracy in the Internet age and who badly need to be educated about what the threats to our digital liberties are, the power struggle being waged for control of the internet, and what ordinary non-techie people can do about it.

What is the most egregious example of corporate censhorship?

I describe in these excerpts here and here how the most insidious abuse of digital power is when you combine unnacountable government with unaccountable companies. Different permutations, variations and degrees can be found around the world.

What could the average user be doing today to have input on the networks and intermediaries that they use daily?

I think we need to see users and customers getting together in associations, developing leadership from the bottom up, then demanding that company management meet with them in person. We need to get more innovative with how we combine the best techniques of online organizing with old fashioned in-your-face, in-the-flesh collective bargaining.

Thanks to Rebecca for being the first to take part in this new "book club" experiment. I'm interested in the discussion that follows. And don't forget to check out the book club selection for April!

Update: The MPAA has now attempted to backtrack on these comments.

Ah, Chris Dodd. It seems like every time he opens his mouth, he makes things worse. In an interview with the Hollywood Reporter, he responds to a series of questions about SOPA by trying to tiptoe around the issue, but basically admits that there are backroom conversations going on between a small number of people, and that "between now and sometime next year," Hollywood and the tech industry will "come to an understanding." He's asked specifically if there are conversations going on now, and if the White House is pressuring folks to come to such "an understanding."

THR: Are there conversations going on now?

Dodd: I'm confident that's the case, but I'm not going to go into more detail because obviously if I do, it becomes counterproductive.

THR: Did you feel personally blindsided by Obama over SOPA?

Dodd: I'm not going to revisit the events of last winter. I'll only say to you that I'm confident he's using his good relationships in both communities to do exactly what you and I have been talking about.

Yes, you know why it would be "counterproductive" to go into more detail? Because he knows damn well that the problem with SOPA was that it was negotiated in the backrooms with private parties and no participation from the actual stakeholders: the public.

So, yes, admitting that you're doing the same thing all over again would be counterproductive. You know what would be productive? Stopping this political backroom dealing crap, and finally coming out and having a public discussion. But he won't do it, because Dodd is a coward and a DC-insider who only knows how to cut deals, not how to actually respond to the public's best interests.

Later in the interview he trots out a nearly identical line to the one he's been using recently, about how he only just discovered that the movie industry wasn't just about red carpets and movie stars.

There's so much misunderstanding about this business. Before I started this job, I would have said it's about Oscar night, red carpets, movie stars and glamorous lives. But there are 2.2 million people who get up every morning and work in this business. I think it's unfortunate there isn't a deeper understanding of how important this industry is to this country.

Not only does this sound ridiculous (and call into question why someone so clueless about the industry was given the top lobbying job for the industry), but it's entirely false. 2.2 million people do not "get up every morning and work in this business." As has been detailed many times, the actual number is less than 400,000 (and that's from the Congressional Research Service), and the number of jobs for people who actually make movies is growing. The only real decrease has been in those who work at theaters -- and that's due to consolidation.

We talk about all sorts of artists who really seem to "get" the internet, and how it can be used for good, rather than something to freak out about. It's worth noting that the band Wilco really was one of the earlier ones to embrace the internet in all sorts of ways, going all the way back to 2002, when the band's label (a Warner Music subsidiary) "rejected" its album Yankee Hotel Foxtrot and dropped the band. It gave the band the rights to the rejected album... and the band responded by streaming the entire thing live on its website. Today that's nothing special. A decade ago that was a pretty big deal. Eventually the album was released and became the band's best seller. We also wrote about them back in 2004, when the band had a cool reaction to an album leaking online before its release date. Rather than freaking out, the band said that it's something inevitable and not a problem. Later that same year, frontman and founder Jeff Tweedy explained a philosophy that will sound quite familiar to folks reading this site:

A piece of art is not a loaf of bread. When someone steals a loaf of bread from the store, that's it. The loaf of bread is gone. When someone downloads a piece of music, it's just data until the listener puts that music back together with their own ears, their mind, their subjective experience. How they perceive your work changes your work. Treating your audience like thieves is absurd. Anyone who chooses to listen to our music becomes a collaborator. People who look at music as commerce don't understand that. They are talking about pieces of plastic they want to sell, packages of intellectual property. I'm not interested in selling pieces of plastic.

Anyway, I was just catching up on some podcasts, and listened to an episode of The Nerdist Podcast in which they interview Jeff Tweedy (bonus geek points: Wil Wheaton joins the Nerdist crew for this one) and they have a good discussion on some of his thinking on these subjects. Wheaton actually brings up the whole Yankee Hotel Foxtrot story, and how the band's decision to put it online like that made him, as a fan, feel invested in the band's success because it was so kind to its fans. That lets Tweedy again make some key points that we've talked about here for a while, but it's always great to hear a successful musician saying similar things:

I'm happy with the amount of goodwill that seems to exist between us and our audience. I can only guess as to why that exists, and I've never been in a band where that didn't exist.... We have our collaborators and our patrons, who come to see us play, and I feel like we treated them as patrons of the arts and collaborators.

And as for the decision to release YHF online for streaming, he first notes that there was no one around to tell them it was a bad idea. It was just a "practical" decision:

We needed to get out on the road, because that's how we make money -- we don't make money off of records. So our business model, if you want to call it that... we support ourselves on the road. And having our new record done and wanting to play those songs just meant, well, let's let people hear them so they'll know what's up. And it'll be more fun to play those songs for everybody....

We just can't look at it as any individual thing is how we're going to be supported by anybody. If they get one record free, they might buy another record. If they get one record free, they might come see the show or they might buy a t-shirt at the show... For us, we've managed to keep our heads above water by not focusing on "the lost sales" but by focusing on the people who are there and are supporting us.

It's an attitude that has worked well for the band for at least a decade, and seems to work for many others as well. It still amazes me that so many others in that business tend to see their fans as criminals and don't make any effort to treat them right at all.

Having failed to pass SOPA, Congress is apparently looking for other ways to keep the big copyright players happy. The latest is a letter sent by 16 senators to the FTC urging the commission to "protect American manufacturers" by cracking down on the fact that foreign companies often use unauthorized software:

"This unfairness harms the affected companies and their employees, as well as consumers and the broader economy," the senators wrote. "It also stifles innovation by forcing law-abiding American businesses — large and small — to compete against those businesses that reduce their operating costs through the use of pirated IT."

Except that much of that is misleading. First of all, it's unclear that the companies in question would have bought the software otherwise, so arguing that it impacts the software companies isn't necessarily true. It is true that US companies have to compete against those other companies, but is the cost of the software they're using really the difference maker here? Besides, for all types of software there is growing competition from open source alternatives. If US companies want to compete, why not adopt more open source alternatives?

Also, what exactly do these Senators think the FTC can do here? The FTC has no jurisdiction over foreign companies and how they operate at home. Finally, even if the FTC could magically stop these companies from using unauthorized software, the end result is likely that those companies would simply shift to alternatives, such as open source software themselves.

No link on this one because the decision isn't "published" and isn't online, but a court in Arizona has revoked the probation on a guy and sent him to jail for ten years, based on a debate over the classification of social networking sites Facebook and MySpace. Now, we should be clear upfront that the guy in question, William Hall, was convicted of some pretty seriously disturbing crimes and, as such, I have no problem whatsoever with him getting whatever punishment the courts decide is within the law. Specifically, the ruling notes that in October of 2010, "Hall was convicted of attempted sexual exploitation of a minor under the age of fifteen, a class three felony, and surreptitious photographing, a class five felony." This post in no way defends Hall. My interest is just in the specific legal reasoning behind the revocation of the probation. Part of the probation was that he was limited in how he could use a computer. The court didn't completely ban internet usage or computer usage (something we've argued is overkill), especially noting that he made his living doing web design. However, it did bar him from visiting specific sites. At issue was guideline #13 in his probation agreement, which says:

I will not use an electronic bulletin board system, Internet relay chat channel, DCC chat channel, instant messaging, newsgroup, user group, peer to peer (e.g.Napster, Gnutella, Freenet, etc).

However, the court (and the probation officer) argued that he violated this section because of his use of Facebook and MySpace. Hall notes that he used those sites to further his web design business and that he specifically told his probation officer that he was going to use those sites and was told that Facebook was fine and that it wouldn't be blocked. There seems to be some dispute over this, as the probation officer says that he believed that Facebook counted under the Guideline listed above. During the trial, there was the following exchange with the "surveillance officer" being the "S.O.":

Q: Can you show me where on [the Guidelines] [Hall] is not allowed to use social networking sites?

S.O.: Yes, No. 13. I will not use any electronic bulletin board system[s] and social networking [is] underneath bulletin board system[s] because [users] can post comments and that's what a bulletin board system is.

Q: The end of paragraph 13 it gives examples of Napster, Gnutella, Freenet. Does not say Facebook, does it?

S.O.: It is so broad. There [are] thousands and thousands.

Q: Everybody knows Facebook. It doesn't say Facebook, does it?

S.O.: This is a little older. It-but it's a category of bulletin board systems which is what all networking systems are.

Again, Hall has been convicted of a very serious crime, and there were a few other parts of the case that raise other questions (he moved without informing the probation officer properly, he was supposed to only have one computer but didn't get rid of his second computer, later on access to Facebook was blocked but he still tried to go there...). It may very well be that he deserves to be in jail. But, for whatever reason, the court first granted him probation, and if we're going to do that, then the rules for probation should be clear. If they didn't want him going to social networking sites, they should have been explicit that this included social networking sites. It wasn't like this happened in the early days of Facebook. He was convicted at the end of 2010. Facebook was huge (and MySpace had already grown and declined). The probation rules list out other specific names. It's ridiculous that they didn't simply add "social networking" or the specific names of Facebook and MySpace if they really wanted to forbid him from going to those sites. Either way, the lower court and now the appeals court (Arizona state courts) have both decided that Facebook and MySpace are covered by Guideline #13 despite the unclear language. At the very least, one hopes that Arizona will update its guidelines for the sake of clarity.

You may recall a couple years ago that a bunch of politicians, led by state Attorneys General, went on a huge grandstanding campaign against Craigslist, because some people were using Craigslist for prostitution -- including some human trafficking. As we noted at the time (repeatedly), Craigslist was incredibly cooperative with law enforcement, and smart law enforcement officials actually used Craigslist as a tool to help discover, track down and arrest those who were breaking the law. But, rather than recognize that Craigslist was a useful tool, a huge media campaign was set off, leading Craigslist to shut down its "adult services" section, despite plenty of legal uses.

Of course, exactly as we predicted, the people who were previously using Craigslist for illegal reasons didn't magically disappear. They just shifted to other sites. One popular one was Backpage, owned by Village Voice Media, publishers of the famed alternative newspaper The Village Voice. Unlike Craigslist, Backpage told the grandstanders that it wouldn't back down. It noted that it cooperates with law enforcement, and that it understands the law and why it's not liable for the actions of its users. A lawsuit filed against the company resulted in Backpage being declared legal.

You would think, maybe, that the media and the granstanders would get the message. But, no, they just keep at it. Nicholas Kristoff at the NY Times recently posted a ridiculously silly column, which first "outs" Goldman Sachs as a minority investor in Village Voice Media (leading GS to sell all its shares before the article went to press, despite it having nothing to do with how the company operates), and then goes on to insist that the owners of the site must be "held accountable."

This is, to put it plainly, stupid. Kristof even acknowledges that the real way to stop human trafficking and underage prostitution is to have "prosecutors... focus more on pimps and johns." You know how they can do that? By using sites like Backpage to collect evidence and to find out who's actually responsible. But, immediately after that, Kristof insists that:

Closing down the leading Web site used by traffickers would complicate their lives, and after so many years of girls being trafficked on this site, it’s time to hold owners accountable.

That's ridiculous. Two years ago, we were told that the "leading website used by traffickers" was Craigslist. And the same sort of idiotically short-sighted campaign closed down that part of the service, and it did nothing to complicate the traffickers lives, because they quickly moved on to a variety of other platforms, including some that don't cooperate nearly as closely with law enforcement as Craigslist did (and Backpage does today). If Backpage is pressured into stopping adult ads, then the traffickers will move on to other sites within hours -- and many will be less willing to cooperate. Blaming the service provider isn't just stupid and pointless, it's counterproductive. It's helping the very people that the grandstanders claim to be targeting.

It's really quite sickening. The best way to stop these awful acts is to go after those responsible. Adding some ridiculous (and probably unconstitutional) secondary liability to third parties doesn't help. It makes the problem worse. Kristof and others may have good intentions, but their simple (and confounding) inability to think more than a single step ahead is really disappointing. In an effort to do good, they're causing a tremendous amount of harm. Not only that, but they're advocating to set an awful precedent when it comes to secondary liability, taking away the basic principle that you don't blame the tool, you blame the person who actually is breaking the law. Kristof is an award-winning journalist, and clearly a very smart person. That he'd be so short-sighted on something like this -- and stoop to the level of trying to drag other companies through the mud -- is immensely disappointing.

The original ruling in the Viacom vs. YouTube case was a complete and total victory for YouTube. The court effectively dumped the case at the summary judgment stage, correctly recognizing that YouTube qualified for the DMCA's safe harbors, and that Viacom was trying to change the clear definitions in those safe harbor provisions. This upset many copyright maximalists, and we heard stories about how the ruling would never survive the appeal. To some extent that was correct. The ruling in the appeal came out today, and it definitely walks back some of the original ruling, but, on the whole, it still leans towards YouTube's position.

The key question in the lawsuit revolved around the so-called "red flag" knowledge question -- and whether or not that meant specific knowledge of items that were infringing (as YouTube and the lower court believed) or just general knowledge of infringement on the site (as Viacom argued). Here, the appeals court got it right, saying that specific knowledge is necessary.

Although the parties marshal a battery of other arguments on appeal, it is the text of the statute that compels our conclusion. In particular, we are persuaded that the basic operation of § 512(c) requires knowledge or awareness of specific infringing activity. Under § 512(c)(1)(A), knowledge or awareness alone does not disqualify the service provider; rather, the provider that gains knowledge or awareness of infringing activity retains safe-harbor protection if it “acts expeditiously to remove, or disable access to, the material.” 17 U.S.C. § 512(c)(1)(A)(iii). Thus, the nature of the removal obligation itself contemplates knowledge or awareness of specific infringing material, because expeditious removal is possible only if the service provider knows with particularity which items to remove. Indeed, to require expeditious removal in the absence of specific knowledge or awareness would be to mandate an amorphous obligation to “take commercially reasonable steps” in response to a generalized awareness of infringement. Viacom Br. 33. Such a view cannot be reconciled with the language of the statute, which requires “expeditious[ ]” action to remove or disable “the material” at issue. 17 U.S.C. § 512(c)(1)(A)(iii) (emphasis added).

The court rightfully rejects the idea that the "red flag" knowledge part of the DMCA means that just knowing that there's some infringement -- without knowing specifics -- means you lose the safe harbors. Since this is the key question in the lawsuit, it's great that the appeals court got this right. This was also the point that the maximalists insisted that no appeals court would uphold, and, clearly, they were wrong about that.

The court responds to the claim that if red flag knowledge does not apply to "general" knowledge of infringement, then it's superfluous, by noting that's not true:

The difference between actual and red flag knowledge is thus not between specific and generalized knowledge, but instead between a subjective and an objective standard. In other words, the actual knowledge provision turns on whether the provider actually or “subjectively” knew of specific infringement, while the red flag provision turns on whether the provider was subjectively aware of facts that would have made the specific infringement “objectively” obvious to a reasonable person. The red flag provision, because it incorporates an objective standard, is not swallowed up by the actual knowledge provision under our construction of the § 512(c) safe harbor. Both provisions do independent work, and both apply only to specific instances of infringement.

In other words, it's possible to show that there are red flags, but they have to be red flags for infringement of specific items, not knowledge that there is infringement in general. That's a good ruling and it makes sense. Accepting Viacom's interpretation would have effectively killed large parts of the DMCA. YouTube's interpretation (now supported by both the district and the appeals court) keeps the DMCA's safe harbors in existence.

That said, the court then suggests that the district court may have erred in granting the summary judgment on that point. Here, the court is talking specifically about YouTube's actions, and saying that Viacom at least raised enough issues that it is possible to argue that YouTube did, in fact, have knowledge of specific infringement. In other words, the court agrees on the big picture interpretation of the law, but disagrees on the specific application by the district court. It doesn't mean that the court thinks that YouTube violated the DMCA -- just that Viacom at least raised enough issues that it should be handled by a jury in a trial, rather than decided at the summary judgment stage. So the case will now go back to the district court to be heard over that issue.

Even here, the judge notes that while Viacom pointed to some email evidence that YouTube execs may have known of some specific instances of infringement which they ignored, it also points out that it's unclear if those specific instances involve videos that are part of this lawsuit -- and that's necessary if YouTube is to lose its safe harbor provisions.

A second issue involves the question of whether or not YouTube exhibited "willful blindness" to infringement on the site. Here, the ruling is a bit troublesome. It notes that the DMCA does not refer to willful blindness (and that the DMCA does note that there is no duty to monitor). But... it then still suggests that there can be a willful blindness question under the DMCA if there is specific knowledge of infringement. So, again, going back to the main issue in this case, if Viacom can show specific knowledge, it might also be able to get YouTube for being "willfully blind." But, it's no sure thing that Viacom can actually show specific knowledge of clips that are a part of this lawsuit.

The third issue is the question of what "the right and ability to control" infringing activity means. Both YouTube and Viacom interpret that phrase differently... and here, the court rejects them both. The district court accepted YouTube's interpretation, saying (reasonably, in my opinion) that a service provider must know of the particular case before it is required to "control" it. That is, how can the "right and ability to control" apply to a situation where there is no specific issue at hand? What is the service provider expected to control if it doesn't know what it's controlling? Viacom, instead, argued that the issue around the "right and ability to control" created a magical "vicarious liability" for service providers if their services were used to infringe. Both courts reject that argument as making little sense and (importantly) going against the Congressional record (which specifically left out vicarious liability, which had been found in an earlier DMCA draft). Here, the appeals court tries to thread the needle with a somewhat confused ruling that doesn't quite agree with either side. It's not a vicarious liability standard, but it doesn't quite require specific knowledge. Instead, the court literally says "something more" is required -- and asks the district court to consider what that "something more" might be.

Finally, there's an issue of what "by reason of" storage means. The DMCA's safe harbors give protection for infringement that happens "by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider." YouTube (and the district court) pointed out that YouTube fits under this definition. Viacom tried to argue that YouTube does not qualify because it does much more than storage -- such as converting (transcoding) videos, offering playback of videos and offering "related videos." Viacom tried (at both levels) to argue that those functions go beyond mere storage, and do not qualify for safe harbor protections. Thankfully, the appeals court here agrees with the lower court and says those are protected. It notes that it's clear that Congress intended "service provider" to mean much more than just a storage provider. I should note that one of our frequent critics in the comments has been insistent that the DMCA was designed only to apply to pure storage providers -- but now we've got yet another detailed court ruling pointing out that this is 100% false.

However, the court does send one "feature" back to the lower court for review. It questions whether or not the syndication of videos to third party sites then falls outside the safe harbor provisions concerning "by reason of storage." The court isn't sure that this is outside the safe harbors, but at least asks the lower court to explore the issue.

In the end, this is a mostly good ruling. It gets the biggest question of law right, even if it's not sure about YouTube's specific actions. On some of the other points, it's a little fuzzy in its thinking, but this is still mostly a victory for YouTube at this stage (though, who knows how the lower court and a jury will rule on some of the specifics). It could have been a more complete victory, but this is hardly the complete rejection of the district court ruling that some maximalists insisted was going to be delivered.

This story is almost too crazy to believe. WIPO, the UN agency that more or less acts as the global IP maximalist agenda-setter, is now being accused of defying UN sanctions, by shipping computers and servers to North Korea. In what appears to be an attempt to avoid scrutiny over this very questionable transfer, WIPO tried to route everything through someone in China. The payment, however, was halted by Bank of America, who quickly realized that delivering computers to North Korea almost certainly violated sanctions against supplying technology to the country.

So why is WIPO giving computers to the North Korean government? Because, in its obsessively idiotic desire to expand intellectual property around the globe, the computers are supposed to help North Korea search foreign patent databases in order to abide by international patent law. Seriously. Why does NK need such computers? Because it bans the internet, so WIPO is concerned that people in North Korea can't use the internet to search through international patents. So, in an astoundingly stupidly short-sighted move, WIPO thinks that by giving North Korea computers to set up a local database of patents and trademarks, it can help the country obey international patents.

“As part of WIPO’s technical assistance program -- and through a mandate from its member states -- the Organization has been supporting IP [intellectual property] offices in developing countries to facilitate the processing of patent and trademark applications since the 1990s,” the spokesman said. “The assistance in question was part of this program.”

The assistance “is intended to enhance the efficiency of the operation of registration for patents by replacing the current ICT equipment with more efficient ICT [information and communications technology] equipment,” the spokesman continued.

Of course, as plenty of people outside the IP-maximalist bubble realize, North Korea doesn't give a damn about foreign patent and trademark applications. The country is actually well known for being a key source of counterfeiting. Second, and perhaps more important, the very reason that there's a ban on sending technology to North Korea is the fact that the government has been making use of any tech it can get its hands on to further its nuclear ambitions. Third, does WIPO really want to be in the business of supporting North Korea's ban on internet access? Are those the kinds of projects that the UN and WIPO think are worthwhile these days?

There's a full project plan that lists out all of the computer equipment being supplied, and lots of talk about how it will be used for patent and trademark databases, but does anyone seriously believe that's how it's going to be used? North Korea even sent a letter to WIPO thanking it for its support in supplying these computers.

Part of the reason that this is now being investigated is because a lawyer at WIPO raised concerns about the project, noting that it appeared to be in violation of UN sanctions (yes, a UN organization is violating UN sanctions...). The lawyer points out that the proper channels of review were not used here, and that he's:

...extremely concerned by the fact that WIPO staff may be implementing a project in violation of two UN Security Council Resolutions... and possibly in violation of staff's own international obligations, and their national laws.

The project also raises serious ethical concerns, namely whether an International Organization should be funding a project that would not be required if the state concerned allowed its population to access the Internet.

WIPO, and its director, Francis Gurry, are insisting they've done nothing (nothing!) wrong at all in supplying computer equipment to North Korea -- despite not being particularly public with the normal communication channels about the deal, and trying to route the whole thing through China. Clearly worried about the criticism, though, WIPO had another WIPO lawyer send around a legal memorandum that reads like a court filing, defending the actions. The memo whines that the decision by Bank of America to block the payment was based on US law, and it's not subject to US law. Of course, that US law is based on those UN sanctions. As for the UN sanctions, the memorandum insists that these actions were all perfectly legal -- believing that as long as you don't say the computers will be used for nuclear efforts, then everything is fine and dandy. It's as if WIPO thinks everyone else in the world is completely stupid.

That said, the very same lawyer, Edward Kwakwa, was also involved in a series of emails, in which he suggests that WIPO cancel the project, suggesting that it may violate the UN rules, and saying that:

I would suggest we go ahead ONLY if you think this arrangement is of crucial importance to WIPO. But given the sensitivities and the broad sweep of the sanctions language, I would prefer that WIPO simply desist from entering into any such arrangement, as it does not seem to be of any consequence or benefit to WIPO, and can bring more trouble than benefit ultimately.

Yes, that's the same guy who wrote the legal memo defending the deal. That same email thread has someone from WIPO saying that perhaps they should cancel the deal... but also pointing out that canceling this particular deal with North Korea would have little impact, "if we take into consideration that similar operations have already been done in the past, and others should be done in the future." In other words, it appears that WIPO has already sent similar technology to North Korea in the past -- perhaps in violations of the sanctions, and appears prepared to do so again in the future.

The whole thing is really quite insane when you go through all the details. WIPO, the IP-maximalist organization that is a part of the UN, is, at the very least, aiding North Korea's plan to keep the internet illegal, by supplying an entire computer system so that people in North Korea can research international patents and trademarks that they will almost certainly ignore -- or use for the purpose of counterfeiting. All of this is almost certainly in violation of UN sanctions against North Korea, and it seems likely that the computing equipment will be repurposed for use by North Korea in its nuclear program, where they are desperate for computing power. On top of that, even as WIPO officials themselves suggest that the deal should be dropped (while admitting more are already planned...), they are also making the case publicly that this is all perfectly legal.

This should be a pretty big scandal, and absolutely calls into question the management of WIPO. Having an economically unsupportable IP maximalist position is one thing. Aiding the North Korean nuclear program is an entirely different issue...

Maria Pallante, who's only been the US Register of Copyrights for a short while, but has worked in the Copyright Office for some time, has apparently decided that she's going to step up publicly as the copyright-maximalist-in-chief. In two recent talks, she has made it clear that she despises those who fought against SOPA, believes strongly that copyright is the sole way of making money for content creators, and, most disturbing of all, thinks that copyright doesn't need to serve the best interests of the country, but, instead, the best interests of copyright holders.

She recently gave an interview to the American Bar Association's "Landslide" publication, which is put out by the "Intellectual Property" Section of the ABA. In showing just how out of touch with the times the ABA remains, there is no link I can share for this story, but in the interview, Pallante is asked about the fact that there is widespread criticism of copyright law being "too restrictive." Her response is downright scary:

"It is my strong view that exceptions and limitations are just that -- they are important but they must be applied narrowly so as not to harm the proprietary rights of the songwriter, book author, or artist. Copyright is for the author first and the nation second."

That, right there, should be grounds for termination, as she clearly does not understand her job or the purpose of copyright law. First of all, it's long been shown that it's the exceptions to copyright law, such as fair use, that help songwriters, authors and artists to create such amazing new works. As we've been discussing a lot lately, there is tremendous evidence that greater exceptions really do help those artists. For her to insist that she only wants narrow exceptions suggests that she's making determinations based on pure blind faith, rather than empirical evidence.

But, much more important is the simple wrongness of that second statement. The Constitution is quite clear about whom copyright is for. It's for the public, not for the creators.

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

The purpose is to promote the progress of science and the useful arts. The method is creating monopolies for authors and inventors. But the clear, stated (and well recognized) intent and purpose of copyright law is for the nation. The goal is to maximize the overall benefit to the nation by helping the artists in a way that serves the nation. For someone in a position such as the Register of Copyrights to flip that equation on its head is really scary, and suggests she does not belong in that job.

Then, in a recent appearance before the American Association of Publishers, her short talk was like a big wet kiss to copyright maximalism, while attacking those who fought against SOPA. She talks up the wonders of copyright as if it's the only way to make money in publishing, and praises the Golan decision that said it's okay for the government to pull works out of the public domain and lock them up under copyright. She also insists that what concerned her most about the fight over SOPA was not the broad overreach of Congress and the MPAA, but rather the fact that the public doesn't understand copyright law, according to her. She's careful in her words, and pays some lip service to exceptions and the public, but it's not difficult to see her true feelings. She sneers at "the copyleft agenda" and snidely refers to the horrors that will happen if Congress listens to the public and changes copyright law based on "flawed notions of the public good." She's afraid that the public speaking out against SOPA means that such evil changes are "inevitable", and worries about that. She also suggests that having access to works for free is "a perversion of the Constitutional copyright clause" (she's quoting someone else saying that, but does so in a manner that shows she agrees). Is the public library "a perversion of the Constitutional copyright clause" in her mind?

Her job is supposed to be to promote the progress of science and the useful arts. That means understanding what the evidence actually shows will do so. Instead, she seems to have made some clear decisions about what must work -- and it's the same things that the copyright gatekeepers want. The role of the public, it seems, is just to be educated on her view of copyright law, and she fears that the public might influence the debate further beyond SOPA. This is immensely troubling, and raises significant questions about her impartiality in the role. The Copyright Office is somewhat famous for it's retrograde views on copyright law, but usually they try not to be quite so blatant about it in public.

For years we've talked about the challenges a global internet creates for legal questions that are based on more limited jurisdictions. As different countries start to deal with this, there has been some fragmenting of a global internet in the form of country-wide censorship, such as those seen in the Great Firewall of China. However, what's to stop it from fragmenting further and further? Eric Goldman points me to a recent academic paper arguing that US courts could start enforcing local obscenity laws on the internet by use of geotargeting. As you probably know, disseminating obscenity is illegal in the US, but the "know it when I see it" rule for determining what is "obscene" has generally focused on "community standards." For the most part, that's meant "local" community standards. That works (somewhat) when you're talking about physical distribution and you can try to determine the local community. But on a global internet? As the paper notes, the Supreme Court has mostly punted on this issue. However, the paper suggests that a solution could be to use geotargeting to re-establish local boundaries, jurisdictions and community standards on a global internet:

The line between obscenity and eroticism is hard to pinpoint, and varies from community to community. In general, the process of analyzing whether a work is obscene includes asking whether the content violates the community standards of the local geographic area where the material was published. Thus, for most media, publishers of potentially obscene content must choose the communities into which they publish, or face criminal charges from the least tolerant communities. But for online media, the Supreme Court remains undecided whether the obscenity analysis should use the local community standard. The Court’s doubts stem from the Internet’s global reach and lack of control over who receives free online content. For example, if a work is nationally-available online, and is judged using the same legal standard as in other traditional media, any local community offended by the content has the power of a heckler’s veto to make the publisher liable for distributing obscenity.

This Article explains why the use of a new online technology resolves the question of whether local community standards should be used to judge online content. Called geotargeting, the technology creates borders on the previously borderless Internet, which allows publishers to specifically target geographically localized communities, thereby excluding areas where the material might lead to criminal charges. This new power to publish potentially obscene materials only to selected communities drastically reduces the constitutional concerns of applying traditional obscenity law to online content.

There are a number of problems I can see with this approach -- some of which are addressed in the paper. However, what troubles me more is the larger issue. There's nothing that says this kind of approach needs to be limited to obscenity. Focusing on something like this opens up a fragmented internet ruled by local jurisdictions, where suddenly all sorts of geotargeting requirements start popping up to create a patchwork censorship regime down to very localized regions.

Many of us consider the global nature of the internet a feature rather than a problem. It allows people stuck in regressive communities to access the outside world and find out that their "community norms" may not be what's considered normal elsewhere. An approach that looks to open up censorship on local standards by use of geotargeting, while unlikely to be effective for those who really do wish to get around it, would almost certainly cause problems for those who have legitimate reasons to reach out beyond their local community.

One of the fields that is ripe for disruption by open digital technologies and business models based on abundance is education. That's already starting to happening with growing successes in the areas of open access and free textbooks. Now here's a major win for open educational resources in Poland (via Slashdot):

Polish Prime Minister Office yesterday accepted "Digital School program" with "Digital Textbooks" component included. With 45 million PLN (approx. 15 million USD) funding it has been the biggest governmental Open Educational Resources initiative in Poland so far. The government has decided to fund creating full set of educational materials for grades 4-6 (9-11 year olds). All those resources will be available under CC BY license, which is fully free license according to the Definition of Free Cultural Works.

It sounds like the use of that cc-by license was a close thing:

This draft [of the Digital School program] was accepted by Ministry of Education, but at a later stage of preparations the free licensing requirement was left out. Both Open Education Coalition and Modern Poland Foundation took part in the public consultation process; their comments in support of free licensing were taken on board in the very last minute.

Without that free license, this would have been just another scheme to produce government-funded educational materials. But with the license, those resources can take on a life of their own through re-use, improvement and wide-ranging adaptations. And once teachers, parents and students begin to see what can be done with freely-licensed educational materials that is hard or impossible to match with traditional licensing, the demand for them is likely to grow.

This makes the last-minute acceptance by the Polish government that the materials would be released under the cc-by license, after some apparent reluctance, doubly welcome, since it may well help to trigger the production of further open educational resources both within and beyond Poland.

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