The broadest, most obvious trend in media consumption is the shift to an on-demand world, where content is available when you want it on whatever device you're using. In the day-to-day, this gets lost behind neverending squabbles about licensing, and severely limited offerings accompanied by bold statements about embracing technology—but in the long run, what's happening couldn't be any more clear. Any long-term strategy for relevance and success in the world of media has to embrace that momentum by building new business models around such distribution schemes, while gracefully dismantling the business models that rely on dying habits and the limitations of antiquated technology.

Or, you can attempt to reshape the cultural norms of future generations by going to the source: kids. At least that's what analyst Todd Juenger suggests in a recent report about children's programming on Netflix. Juenger conducted a focus group with mothers and discovered that they really like Netflix as a source of entertainment for their kids, especially since they can put it on whenever they want—and that kids are growing accustomed this. To hear Juenger talk about it, you'd think this was both surprising and bad (it's neither). His advice to the providers of children's programming? Stop this trend immediately:

His advice for entertainment companies is to be cautious about how much kids programming they make available to the online video streaming provider and in which windows. "We remain firm in our belief Viacom and Walt Disney should limit their content availability on Netflix," Juenger wrote.

...

"Moms are increasingly directing their kids to alternative viewing modes for content control, commercial avoidance and time management," Juenger summarized the findings. "The moms we talked to originally subscribed to Netflix for themselves, but have recognized the dwindling supply of content for adults and are now using the service primarily for their kids…The content selection is perceived to be significantly better for kids than for adults, and the lack of commercials and ability to control the viewing choices are seen as positives.”

According to the analyst, the focus groups described children as device agnostic, "happily watching on TV sets, tablets, computers, even phones, with indifference." The result: “Our concern regarding Viacom and Disney’s kids’ networks has been reinforced,” Juenger said. “Viacom and Disney should do everything in their power to steer viewership toward modes with the best long-term economics, namely traditional TV and emerging forms of TV Everywhere VOD.”

Yes, he's confirmed that the "lack of commercials and ability to control the viewing choices are seen as positives", in case anyone in Hollywood was still clinging to the hope that consumers would grow to hate those things. And yes, kids are "happily watching" on a variety of devices, and we can't have that, can we? Some might respond to the observation of a clear consumer preference in young children by trying to embrace that change early (if anything Hollywood does with technology can be called "early" at this point) but Juenger thinks they're better off trying to hold back the tide, or at least redirect it into their proprietary canals.

The funniest part is that suggesting Disney and Viacom should try to "steer viewership" is appealing to the very power such companies are losing. Big media empires don't get to "steer viewership" the way they used to, and that's exactly why these new distribution methods represent a threat to them. Juenger is suggesting they keep the sinking ship afloat by tying it to... itself. That's not going to work.

I heard from more than a few people that Senator Patrick Leahy would never be convinced of his distorted views on copyright for one key reason: he loves the way Hollywood puts him in movies -- with Batman being a particular infatuation. As you can see on Leahy's IMDB page (yes, he has one), he appeared in both the Batman TV series and The Dark Knight. Now, it's being reported that he's also making an appearance in the upcoming The Dark Knight Rises, where he gets to appear in a scene with Christian Bale. Of course, normally you might think that this kind of thing, something that Leahy is clearly excited about and proud of, would count as a "gift" and potentially run afoul of Senate ethics rules. It's not as if the studio is putting him in these films because of his acting chops...

I was recently at a "tech" conference that focused on entrepreneurs, and I watched a panel discussion on "legal issues" where the first speaker went on at length about why startups absolutely needed to apply for patents as soon as possible. He argued that so much of a company's value was "tied up" in its "intellectual property" and you absolutely needed to "protect" it or the company could just be copied. This shows a fundamental misunderstanding of true value. The idea, by itself, is somewhat meaningless. The real issue is the execution -- and no matter what you know about the idea, the actual execution is always a lot more difficult. Focusing on "protecting" rather than executing can actually be the death of a startup.

Thankfully, it looks like more and more startups in the "soft technology" realm are recognizing this, and are getting fewer and fewer patents. TechCrunch has a post by patent lawyer Leonid Kravets who did a study of patents and funded companies, and found that each year over the past few years, startups seem to be getting fewer patents. It may be tough to tell from the chart, but basically, each year shows fewer patent applications from startups. There's a ton of other interesting data at the link above, including some differences between certain investors. Not surprisingly, corporate VC wings seem to like companies with patents (a very big company mentality). Whereas VCs that have been investing in some of the most successful startups today (like Accel, which funded Facebook, and Union Square, which funded Twitter, Kickstarter, FourSquare, Tumblr and many others) have a much lower number of startups they invest in that have patents. Those VCs seem to recognize that it's not the patents that matter, and the general success of both of those firms' portfolios suggests they may be on to something.

The amount of music in the world is growing every minute -- it's not even possible for a single person to listen to every song within a normal lifespan. Luckily, no one would really want to listen to every song, but technology is accelerating the process of creating music with algorithms that can compose songs faster than any human musician and robots that can play non-stop. If virtual monkeys can re-create Shakespeare (albeit in short snippets), it's only a matter of time before virtual musicians are churning out pop hits. Here are just a few recent accomplishments of our new robot musician overlords.

• "Evolution of Music by Public Choice" is the title of a paper that describes how a genetic algorithm -- along with input from volunteers -- made some not-unpleasant-sounding music. Check out Darwin Tunes to participate in the project and become part of the evolutionary record for this. [url]
• If you really want to surround yourself with your favorite music, there's some software that'll turn your tunes into a carpet pattern for you. But for some practical reasons (and copyright law?), only 5 carpet patterns from this algorithm have been manufactured: classical, ambient, jazz, electronic and silence. [url]
• Sound Machines 2.0 (a robotic string quintet) listens to whatever music you play for it, re-interprets your musical choice, and then plays its own musical composition based on what it heard. However, it might be better to wait for Sound Machines 3.0 for all the bugs to be worked out.... [url]

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

Well, we may have found at least a temporary answer to the question of "just how far will Charles Carreon dig?" According to Mark Lemley, one of the lawyers representing IndieGoGo against Carreon, Charles Carreon has just dismissed his lawsuit. One hopes this means that he's finally realized that this entire process was a mistake. A broad apology for massive overreaction after massive overreaction from Carreon (and his wife who apparently referred to us at Techdirt as a "nazi scumbag") might be nice, but if it's just a general admission that he had gone too far, that seems good enough. Of course, given how far he went, and his repeated insistence on not giving up, I do wonder if this is really the end of all of this. Somehow I doubt it. This is a voluntary dismissal, which means he could refile. But, for a brief moment, it appears that he's stopped digging.

Update: Carreon is apparently declaring victory, claiming that the lawsuit gave him what he wanted. Uh, yeah. He sued to make sure that Matthew Inman and IndieGoGo did exactly what they said they were going to do... and then when they did exactly what they promised to do, he claims that's a victory? At best, he did two things: had Inman limit the donations to just two charities rather than four, and made Inman take some of his own money out of the bank to photograph it (as promised) for Funnyjunk, rather than use the actual money raised during the IndieGoGo campaign. If his goal there was to force that to prevent embarrassment I don't see how that's a victory. Does anyone honestly believe that Carreon came out of this with a better reputation than if he'd just let the original plans happen? Carreon could still face requests for legal fees from those he sued, though it wouldn't surprise me if they all just dropped it. Carreon seems to think the newfound attention he's received is a good thing, which just shows how completely out of touch he is. As Ars Technica notes:

But if the defendants pursued attorney's fees, the attention might be worth it for Charles Carreon. After asking for comment on his voluntary dismissal of charges, Carreon lilted over the phone, "I'm famous, I'm notorious." Which, from the looks of it, is exactly what he wants.

There are times that it's worthwhile to be notorious. And there are times that it's not. This is the second one.

We've talked in the past about the importance of copying what other companies do as a business strategy (and just how common it is throughout history, despite the pejorative terms associated with it). But one of the key factors in making "copying" a successful strategy is in knowing how to improve upon what you copy. It's why Apple has been so successful over the years. Yes, it builds on the ideas of others, but does so in a way that improves them and makes them more usable.

Yet, we always hear of people fearing companies copying one another (sometimes mistakenly calling them "thieves" or decrying their unoriginality). And yet, it seems pointless to worry about such things. Even as people always seem to be afraid of big companies with big budgets copying others, history has shown time and time again that this almost never works. That's because merely copying what someone is doing not only takes you "where the puck has been" rather than "where the puck is going," but also has you focused solely on the outward, superficial aspects of what makes another product or service successful. What's missing is an awful lot of details in the background -- the knowledge of why certain things work and don't work, as well as how users and customers actually interact with the product. Such copying almost inevitably fails.

With that said, it seems like Samsung's plan to make its own Facebook, using the rather telling code name "Samsung Facebook" seems destined to fail for exactly that reason. The very fact that they're internally calling it "Samsung Facebook" shows that they're already aiming at a target in the past, rather than the future. It's the exact wrong approach and almost guarantees that whatever comes out of it will be seen as pointless by the time it launches. Learning from what others do is a useful strategy. Copying what others do can be a very important business strategy -- but it has to be done with the goal of exceeding where those others are heading, not in replicating what they've already done. That's a recipe for expensive failures.

As the debate over file sharing rages on, a number of voices have stepped up to offer their opinions on all sides of the issue. In a post titled "Paying for Music: My Two Cents (Pun Intended)," Danny Bowman (a software engineer at Funzio and developer for Brute Labs) presents the argument that this "not paying for music" is the result of two things: first, the familiar discussion of scarce vs. infinite goods and secondly, a huge increase in participation has both aided in driving down the price of music as well as bringing us more in line with our cultural past, when making music was something everyone did, rather than a select few.

The assumption that artists should be compensated with money for recording music is probably based on economic and technological factors in the 20th century, when the means to produce and distribute quality music were limited to "professionals." Recording equipment required experience and expertise to produce anything listenable. [G]etting recordings into the hands of a large audience required a lot of infrastructure.... When the production and distribution of music had such barriers to entry, recorded music had economic value and people were willing to pay for the music that made it through those barriers. Musicians were operating in an industry, producing something that only a limited set of people had the means to produce.

But things have changed. With the barriers gone, anyone can get on the playing field.

Have you used music production software lately? It's really easy to make a professional sounding recording. And once you do, it's super easy to post the file online and then anyone in the world with an internet connection can hear it. In my mind, music production no longer has the barriers to entry that give it economic value. Amateurs are often making music that I like more than "professional" recordings. Heck, even I can make music that I like listening to more than a lot of "professional" recordings. In my view, recording music no longer carries economic value, so I generally don't feel the need to compensate musicians with money for their recordings.

Despite claims to the contrary, the amount of music being produced isn't dropping. The supposed "lack of financial incentive" isn't discouraging thousands of "amateurs" from expressing themselves creatively. If you thought you were having trouble selling an album before, how are you going to do it now that everyone has an album of their own?

This high level of participation isn't a new thing. Having more creators than consumers used to be the norm, rather than an indicator of massive disruption. Over the course of human history, music shifted from something everybody performed towards a top-down distribution that separated the "professionals" from the "consumers." Bowman quotes This Is Your Brain on Music: A History of Obsession by Daniel J. Levitin.

Music is unusual among all human activities for both its ubiquity and its antiquity. No known human culture now or anytime in the recorded past lacked music. Some of the oldest physical artifacts found in human and protohuman excavation sites are musical instruments: bone flutes and animal skins stretched over tree stumps to make drums... Only relatively recently in our own culture, five hundred years or so ago, did a distinction arise that cut society in two, forming separate classes of music performers and music listeners. Throughout most of the world and for most of human history, music making was as natural an activity as breathing and walking, and everyone participated. Concert halls, dedicated to the performance of music, arose only in the last several centuries.

To further illustrate this "performer-listener" phenomenon, Levitin talks about Jim Ferguson, a professor of anthropology, who performed fieldwork in the tiny country of Lesotho in Africa.

Jim patiently earned their trust until one day he was asked to join in one of their songs. [W]hen asked to sing with these Sotho villagers, Jim said in a soft voice, "I don't sing," and it was true: We had been in high school band together and although he was an excellent oboe player, he couldn't carry a tune in a bucket. The villagers found his objection puzzling and inexplicable. The Sotho consider singing an ordinary, everyday activity performed by everyone, young and old, men and women, not an activity reserved for a special few.

Our culture, and indeed our very language, makes a distinction between a class of expert performers - the Arthur Rubinsteins, Ella Fitzgeralds, Paul McCartneys -- and the rest of us. The rest of us pay money to hear the experts entertain us. Jim knew that he wasn't much of a singer or dancer, and to him, a public display of singing and dancing implied he thought himself an expert. The villagers just stared at Jim and said, "What do you mean you don't sing?! You talk!" Jim told me later, "It was as odd to them as if I told them that I couldn't walk or dance, even though I have both my legs." Singing and dancing were a natural activity in everybody's lives, seamlessly integrated and involving everyone [...]

Music has been a participatory, non-exclusionary form of art for longer than it has been a gated community composed of a handful of beneficiaries. The timeframe in which music and commerce came together to make a handful of artists successful is much, much slimmer than even the era of "performers" and "audiences." Mick Jagger, of all people, recognized this fact despite being one of the largest beneficiaries of this anomaly:

But I have a take on that - people only made money out of records for a very, very small time. When The Rolling Stones started out, we didn't make any money out of records because record companies wouldn't pay you! They didn't pay anyone!

Then, there was a small period from 1970 to 1997, where people did get paid, and they got paid very handsomely and everyone made money. But now that period has gone.

So if you look at the history of recorded music from 1900 to now, there was a 25 year period where artists did very well, but the rest of the time they didn't.

Some, however, seem to feel that this brief window of commercial success is the way it always has been and the way it always should be, despite evidence to the contrary. As Bowman points out, artistic expression and capitalism are an uneasy mix.

I think another important point here is that these content industries have always involved an uneasy fusion of Art and Capitalism, and that given the choice, people want to lean towards Art. Put another way, people prefer to think of music as an expression of something emotional and visceral that just wants to get out into the world, not as an industry or a business or a vehicle to make money. When anti-piracy advocates talk about not paying musicians as a "social injustice," it simply doesn't hit home. You have to pick a side - is music to be treated as Art? If so, then expecting payment is just delusional. Is music then a business? If so, the more broadly accessible means of production and distribution have eliminated the economic value that made recording viable as an industry. Deal with it. We didn't like music being a business anyway.

As long as file sharing and the music business are still being discussed as a matter of right and wrong, the real issue - economics - is ignored. And as long as this pertinent part of the equation is ignored, those arguing against the current reality will continue to miss the point, at their own expense.

The changes in business model are not caused by morals or ethics, but rather by economics. When you take Art and monetize its production and create an industry, and that industry is then faced with the realities of capitalism and supply and demand, don't act like there is social injustice at work. You can object to the capitalist system, but you can't argue that things should work the way they did when capitalism was going well for you.

Many argue that today's world will be the death of any form of artistic expression that can be converted to ones and zeroes, but what they're really saying is that the very brief moment when art and commerce merged successfully is over. With the way forward being a much more competitive path, it's no surprise that these voices choose to conflate economics and morals in order to make today's reality seem like the kleptomania of spoiled children. But if the music industry dies, music will still live on.

I think the bottom line is that nobody cares if the Music Industry dies because nobody believes it is adding value anymore, and that Music will continue on just as it has since the protohumans first started making it. That's why people won't pay for it.

One of the big complaints about ACTA and SOPA and the like was the extreme maximalist positions that they entailed, without recognizing the very important exceptions and limitations that can often be even more important in encouraging culture and creativity. The version of the US's recommendations on the IP chapter of the Trans Pacific Partnership (TPP) agreement that leaked last year, suggested a similar maximalist approach: all enforcement, all the time, no concern about limitations or exceptions.

In a somewhat surprising turnaround, the USTR has now admitted that it is actively embracing limitations and exceptions in its latest proposal around IP for TPP:

For the first time in any U.S. trade agreement, the United States is proposing a new provision, consistent with the internationally-recognized “3-step test," that will obligate Parties to seek to achieve an appropriate balance in their copyright systems in providing copyright exceptions and limitations for purposes such as criticism, comment, news reporting, teaching, scholarship, and research. These principles are critical aspects of the U.S. copyright system, and appear in both our law and jurisprudence. The balance sought by the U.S. TPP proposal recognizes and promotes respect for the important interests of individuals, businesses, and institutions who rely on appropriate exceptions and limitations in the TPP region.

Given the USTR's general lack of transparency and intellectually insulting attitude towards anyone who questions TPP and ACTA transparency, I don't trust the USTR on its commitment to this... but I have been hearing from multiple sources that the protests against SOPA and ACTA have had a big impact on the administration's thinking on intellectual property issues... and that the MPAA/RIAA folks are not at all happy about the latest version of the USTR's IP chapter. There have also been multiple assurances that the USTR will fight strongly to make sure that this language on exceptions remains in the agreement, even if some of its "advisers" from the legacy content industry don't like it. That suggests that maybe, just maybe, some voices of reason have gotten through to the USTR.

All that said, this requires very close scrutiny. And, of course, there's all sorts of things that can be hidden in the language -- which, of course, the USTR still has not revealed. In the interest of openness and making sure that these provisions actually are in the best interest of the public, it would be nice to actually have the USTR live up to its transparency commitments and publish the specific text that relates to these limitations and exceptions. On top of that, the so-called "3-step test" that the USTR mentions is somewhat limited (and a bit antiquated) in these modern times with an internet where things like mashups and remixing occur on a daily basis. It would obviously be a lot nicer if we actually moved forward with our limitations and exceptions to copyright law to bring them into the 21st century -- but having the USTR actually acknowledge such limitations and exceptions as an important part of the IP chapter on TPP is a huge (almost monumental) step forward.

Either way -- and I know that some people will never trust anything from the USTR considering how many bridges it has burned -- the USTR deserves at least some kudos for taking this surprising step, and hopefully it continues to recognize that this is an important issue. With further exploration, and further acknowledgement that the MPAA/RIAA's view of thew world is not the only one, perhaps the USTR can recognize that setting up a maximalist/protectionist plan does not help the US, the economy or creativity. Enabling a more functional system, including knocking down the barriers that copyright sometimes sets up, is a much more effective path.

You may remember that a couple years ago, an appeals court in the US ruled that, when dealing with software, as long as the provider calls what it sells "a license" rather than a "sale" it can take away your first sale rights. As you hopefully know, first sale rights are what let you resell goods that have copyright-covered material in them -- such as books -- without asking for permission from the copyright holder. However, for reasons that still don't make any sense, the 9th Circuit seems to think that as long as something is purely digital, first sale no longer applies.

The Supreme Court refused to hear the appeal, so while technically the ruling still only applies in the 9th Circuit, it's what most consider to be the state of the law in the US (there is always the possibility a different circuit court could disagree and it could go back to the Supreme Court -- and one could argue that some other rulings in the 9th Circuit already conflict -- but for now, the Autodesk case is widely considered the standard). There is, also, the upcoming ReDigi case, of which there's a decent profile in the Boston Globe -- but that's focused on music, and it's not entirely clear how that one will come out either.

Over in Europe, however, it appears that the European Court of Justice (who has been pushing out some relatively insightful rulings on copyright issues lately) seems to recognize just how ridiculous the 9th Circuit's view on first sale and software really is. In a new ruling, it has upheld the right of first sale on software, basically saying that you are buying a license and that license is resellable.

The specific case involved a company, UsedSoft, that was trying to create a market in reselling used software. Oracle sued, claiming that its license agreement specifically stated that it could not be resold. However, the court found that the right of first sale applied. In the court's language, it talks about copyright "exhaustion" which is the idea that once you've sold something you've "exhausted" your right to control it.

It makes no difference, in a situation such as that at issue in the main proceedings, whether the copy of the computer program was made available to the customer by the rightholder concerned by means of a download from the rightholder’s website or by means of a material medium such as a CD-ROM or DVD. Even if, in the latter case too, the rightholder formally separates the customer’s right to use the copy of the program supplied from the operation of transferring the copy of the program to the customer on a material medium, the operation of downloading from that medium a copy of the computer program and that of concluding a licence agreement remain inseparable from the point of view of the acquirer, for the reasons set out in paragraph 44 above. Since an acquirer who downloads a copy of the program concerned by means of a material medium such as a CD-ROM or DVD and concludes a licence agreement for that copy receives the right to use the copy for an unlimited period in return for payment of a fee, it must be considered that those two operations likewise involve, in the case of the making available of a copy of the computer program concerned by means of a material medium such as a CD-ROM or DVD, the transfer of the right of ownership of that copy.

There are some interesting side notes on this. First, the court also rules that if Oracle promised free maintenance updates to the original licensee, it must continue to provide those to whomever purchased the "used" software. However, it also puts a couple of limitations on this. The first one is somewhat obvious: the seller of the used license can no longer be using the software. Oracle argued that this would be hard to track, but the court rightly points out that this is the same issue that those who sell software on CD-ROMs and DVDs face, but they figure out how to survive:

As Oracle rightly observes, ascertaining whether such a copy has been made unusable may prove difficult. However, a copyright holder who distributes copies of a computer program on a material medium such as a CD-ROM or DVD is faced with the same problem, since it is only with great difficulty that he can make sure that the original acquirer has not made copies of the program which he will continue to use after selling his material medium. To solve that problem, it is permissible for the distributor – whether ‘classic’ or ‘digital’ – to make use of technical protective measures such as product keys.

Separately, however, the court ruled that you cannot divvy up the number of seats in a license and sell them individually. That is, if you buy a 100 seat license to some software, and are only using 50, you can't then sell just those other 50 seats. This ruling says that the first sale only applies to the entire license agreement, basically.

There is some disagreement as to how "big" an impact this ruling will have. To be honest, I'm not convinced that the overall impact will be that large, but I think it is a good thing that the court appears to recognize that you cannot contract away certain rights granted to you under copyright. Copyright holders have long tried to remove the limitations and exceptions of copyright law through contracts and "licenses." Recognizing that those limitations and exceptions really do exist is important, and it's good to see the EU Court of Justice release a clear ruling on that issue.

We mentioned, recently, that Wikipedia founder Jimmy Wales had started a petition to try to stop the extradition of Richard O'Dwyer, the UK student who set up a site for users to point others to online sources for TV shows (some of which were legit, some of which were infringing) -- and is now facing extradition and criminal charges in the US for daring to help people find video online. Since then the petition has received well over 200,000 signatures, including UK politicians from all three parties. You might think that the UK government would take notice.

Not yet, it seems.

The UK Home Office is apparently ignoring the petition and sticking with the party (i.e., Hollywood lobbyist) line. The site V3 (linked in the last sentence) reached out to the Home Office who said that they were aware of the petition, but didn't seem to care:

"Richard O'Dwyer is wanted in the US for offences related to copyright infringement," a Home Office spokesman told V3.

"The UK courts found there were no statutory bars to his surrender under the Extradition Act 2003 and on 9 March the Home Secretary, having carefully considered all relevant matters, signed an order for his extradition to the US."

That said, Jimmy Wales insists that the "low level" spokesperson "is wrong" and he fully expects that the Home Office will, in fact, respond after meeting with him about this issue. Let's hope that's true. Given the large public outcries about other related copyright issues (SOPA, ACTA...) you would think that the UK government would at least be paying attention when a rather large group of the public speaks out on an issue related to copyright. Hopefully, the answer given to V3 was just a spokesperson stalling until the Home Office is ready to officially address the matter.

We recently wrote about how the receiver for Righthaven's assets, Lara Pearson, was surprised to learn that Righthaven founder and former CEO Steve Gibson had gone out and hired lawyers in an attempt to continue the appeals court cases concerning some of its district court losses on key issues. Given that Righthaven had gone into receivership, and Pearson had effectively taken control while auctioning off what few assets there were, this was a problem. Pearson made it clear to Gibson that he no longer had anything to do with Righthaven, alerted both the lawyers he had hired and the court of what Gibson had done, and hoped that Gibson would go away. No such luck: he's now filed an "objection to the receiver's notification terminating" his job. You can see the whole thing below.

He makes a few points. First, he again reiterates that Righthaven's key lawyer in many of these lawsuits, Shawn Mangano, had simply stopped responding to him back in February. He seems to want to blame the mess he's in on that. Separately, he argues that the receiver did not have the right to take over the company, and that she did not follow specific court rules. Also, he appears to be trying to reclaim ownership of Righthaven, though the argument is complex:

Even if the Receiver’s termination of me as CEO was somehow within her authority and done within the parameters of permitted procedure, the Receiver’s position that that somehow divests me of authority would be wrong. A limited liability company is ultimately governed by its members and the members have chosen Net Sortie Systems, LLC (“Net Sortie”) as its statutory manager. I am the manager of Net Sortie. While the manager manages the CEO, in the absence of a CEO, the manager would assume management of all affairs of Righthaven...

He seems particularly upset that Pearson went out and hired another lawyer -- one who fought against Righthaven -- to help deal with the ongoing appeal, which likely means an effort to get the case closed as quickly and simply as possible. Gibson claims that it's his right to make such hires, despite the dismissal from his job that appears to indicate otherwise. He also keeps suggesting that there's a public interest in having the case heard at the appeals court -- and insists that (the old) Righthaven would succeed on appeal and get a litany of district court rulings against it overturned.

The filing is also chock full of snide remarks directed at Marc Randazza, with Gibson suggesting that the fact that blogs and others in the press have been mocking him is all because of Randazza -- and that the press' interest in this case is somehow unfair to him. Gibson really does seem taken aback at the fact that no one seems to be on his side any more. His own lawyer won't returns his calls. His job at Righthaven has been stripped away. He's being investigated for all this. So you can understand why he's lashing out and going legal, but this can't end well for him.

Rather, it appears that the Receiver is following the agenda of Mr. Randazza who apparently has a very serious concern that the Ninth Circuit will rule in Righthaven’s favor and unravel, finally, his vigorous press campaign, his personal attacks and any right to legal fees he currently enjoys. Unlike Mr. Randazza, Righthaven generally has made a conscious decision to not litigate matters in the press, to not engage in personal attacks either before the courts or otherwise and to address the legal arguments in a clinical fashion.

Independently, as addressed more fully, infra, I remain the manager of the manager of Righthaven and I should have the right to hire or terminate Righthaven counsel.

In other words, this saga is simply not over yet.

Tim Lee has a great blog post over at Forbes in which he discusses the concept of "social distance" and how it relates to problems in patent and copyright law. The basic point: if you actually know people who are suffering from specific problems, you're much more willing to take those problems seriously. Lee points to two examples.

The first concerns a former chief judge at CAFC, the appeals court that handles most patent appeals, Paul Michel. Michel has been pushing a plan to increase the number of patents out there (and actually thinks the government should subsidize patents). But a few months ago, when Lee got to interview him, and asked him about all the problems developers and startups are facing because of patents, Michel dismissed them, and suggested that if they were having trouble with patents, they should just not participate (ignoring that the problem isn't the lack of participation, but those who sue these firms).

As Lee points out, it seems as though Michel has nearly no first hand knowledge of what's really happening in the field. It seems unlikely that he regularly interacts with entrepreneurs and software startup folks. But you know who he does spend plenty of time with? Patent lawyers:

One has to imagine that if people close to Michel—say, a son who was trying to start a software company—were regularly getting hit by frivolous patent lawsuits, he would suddenly take the issue more seriously. But successful software entrepreneurs are a small fraction of the population, and most likely no judges of the Federal Circuit have close relationships with one. In contrast, every judge on the Federal Circuit knows numerous patent attorneys, so they’re well-attuned to the concerns and strongly pro-patent worldview of the patent bar.

Lee's second example makes the point even more strongly. He talks about Richard Epstein, the famous libertarian law professor and writer. Despite his general views against regulation, for some reason Epstein has always had a blindspot for intellectual property law. He's been a pretty strong maximalist. But Lee notes that there's one small area where Epstein goes in the other direction -- and it's because of exactly the kind of situation he hypothesizes above: a family member struggling because of over-aggressive IP law.

While Epstein has done a lot of great scholarship, his “maximalist” approach to copyright and patent issues tends to underestimate the economic frictions introduced by these legal regimes. But there’s one exception: he has a clear understanding of the problems weakened fair use rights pose for documentary filmmakers. Why? Because his son is a documentary filmmaker who has experienced firsthand the difficulty of assembling the rights necessary to publish a documentary film.

The bigger question, of course, is how do you fix that problem? How do you "decrease" the social distance between various people and those who are regularly harmed and hindered by over-aggressive patents and copyright. As Lee notes, that's a very difficult problem to solve: "senior public officials can only have so many friends and relatives." Of course, if you can't reduce social distance, perhaps alternatively you could increase awareness of the lack of social distance. Perhaps this wouldn't work -- as people likely overestimate what they "know" of certain types of people when they really have had no serious interactions with them -- but if there could be greater self-realization then they might seek out others who do have those kinds of relationships and that kind of access.

Well, this is unfortunate. We've written a few times about how various countries, under the TRIPS agreement are able to break patents on important medicines in the interest of public health. Most recently, we wrote about how India did this with a cancer drug made by Bayer called Nexavar. Despite the fact that Bayer has more than made back the money it spent bringing Nexavar to market, it's been pricing the drug at an unaffordable $70,000/year. After India allowed a small bit of competition, the price has dropped. We've seen that the USPTO doesn't like this at all and has tried to claim that high priced drugs are good for one's health, but that's beyond ridiculous to anyone who actually thinks.

Of course, "thinking" and "Congress" aren't words that often go together, so it appears that the USPTO is now trying to pull one over on Congress, with USPTO deputy director Teresa Stanek Rea misleading Congress by suggesting that these efforts violate international agreements like TRIPS. Unfortunately, TRIPS says exactly the opposite:

Rea told the committee, saying she believes the issuance of the Indian compulsory license was in violation of the Agreement on Trade Related Aspects of Intellectual Property Rights, an international pact administered by the World Trade Organization which sets minimum standards for intellectual property regulation. Rea said the USPTO is working to stem the tide of IP infringement in foreign countries by the use of a host of training programs and educational efforts aimed at foreign officials and judges along with the placement USPTO overseas IP attaches in Thailand, China, Russia, India, Brazil and Egypt.

Article 31 of the TRIPS Agreement expressly permits compulsory licenses as does the much earlier Paris Convention on the Protection of Industrial Property. The U.S. Itself routinely makes government use of patented inventions pursuant to Congressional authority under 28 U.S.C. Sec. 1498, but also has other laws allowing compulsory licenses in specific circumstances. Compulsory licenses have been allowed globally in the vast majority of intellectual property regimes since the 19th century. And, the patent on Nexavar in India had been granted under a 2005 Amended Patents Act that clearly articulated compulsory licensing rights at the time that Bayer prosecuted its patent and the patent was granted.

Finally, and most to the point, the US signed the Doha Declaration on the TRIPS Agreement and Public Health that pointedly grants countries the right to issue compulsory licenses, to define the terms upon which such licenses are granted – without restrictions, and to define the emergency circumstances that permit licenses to be granted without any prior notice to or negotiation with the patent holder (note: these expedited, no-negotiation procedures were not used in the Natco case). Under the Doha Declaration, countries are permitted to issue compulsory licenses in order to ensure “access to medicines for all” – something that India has attempted to do via the license granted.

It's a shame that the USPTO appears to be so in the tank for big pharma (they get lots of patents, which helps pay USPTO salaries...), that they're willing to mislead Congress on issues like this, even if it means that very sick people around the globe don't get the medicines they need.

Remember how Canada and Mexico have been asked to join the negotiations over the Trans-Pacific Partnership (TPP) agreement -- and both agreed to do so? You might think that this would enable them to show up this week in San Diego and at least observe, if not actively participate in, the latest round of negotiations. No such luck. Both countries have been denied access to the negotiations as observers. This is, of course, similar to what Rep. Darrell Issa discovered after his own request -- but in that case, you can at least kind of understand, since we already know that the USTR wants to hide its negotiations from Congress. But denying two countries who are entering the negotiations? If Canada or Mexico had any self-esteem at all, this is the point where they should have walked out and said to hell with the TPP. Why should they be expected to join an agreement where secret negotiations are happening, which they're not allowed to take part in?

Another day, another story about Charles Carreon digging himself a deeper and deeper hole. This time, it starts with him threatening to sue both the person who set up the parody site charles-carreon.com and Register.com, where the domain was registered. Register.com failed to live up to its own "privacy" promises regarding registration info, and exposed the name and personal info of the person who registered the site after receiving a letter from Carreon, despite direct promises to the person's lawyer. After another phone call in which the lawyer, Paul Levy, warned Register.com that it faced breach of contract charges, it made the info private again.

However, Carreon continued to threaten the blogger, leading to a rather bizarre exchange between Carreon and Levy, which relates to some history that Carreon has had with Levy's organization, Public Citizen, and a case we wrote about last year, involving a website run by Carreon and his wife. In the end, the owner of charles-carreon.com felt sufficiently threatened by Carreon's claims that s/he has decided to file for declaratory judgment to stop Carreon from suing. Part of the reason for seeking declaratory judgment was Carreon's direct threat to go after the blogger at a later date in various jurisdictions. He also threatened to use the DMCA takedown process to try to censor the site, because it uses a photo he claims copyright over. There's significant irony in the fact that Carreon is now threatening to abuse the DMCA process to stifle speech -- when what kicked this whole thing off was his DMCA-based defense of Funnyjunk and its failure to remove copyright-covered images.

Carreon's threat-letter response to Levy is something to behold, and can be viewed towards the bottom of the filing (pdf and embedded below). Here's a key part:

As far as when and where I will sue your client, be certain that it will occur if your client does not cede the domain, and advise her of ten things:

1. There there is essentially no statute of limitations on this claim, and the prima facie laches defense would not kick in for at least three years.
2. That venue in this action can be validly laid in at least three places, maybe four, if she doesn't live in Arizona, Florida, or California.
3. That I am capable of employing counsel to handle my claim against her, who will incur attorneys fees and seek recovery of the same. I filed pro se against Inman simply for sake of convenience and the need for speed, and not from a lack of resources.
4. That the law in this area cannot be predicted with certainty, will evolve substantially over the next three years, during which I will be using digital forensics to establish actual trademark damages in addition to seeking the maximum cybersquatting penalty of $100,000.
5. That a judgment that recites that the domain was obtained by fraud upon the registrar, in the form of a misrepresentation that she did not know of my trademark on the name, might well be non-dischargeable in bankruptcy.
6. That a judgment can be renewed indefinitely until collected, and that California judgments accrue 10% interest, which can compound once ever ten years by capitalizing the accumulated interest.
7. That you cannot guarantee that Public Citizen will provide her with free legal services on June 1, 2015, when I may very well send the process server 'round to her door.
8. That I have the known capacity to litigate appeals for years (check my Westlaw profile, and of course, the drawn out history of Penguin v. American Buddha, now in its third year, having passed through the Second Circuit and the NYCA, and still hung up in personal jurisdiction in the SDNY).
9. That the litigation, being of first impression in virtually every Circuit, grounded in a federal question, involving a registered trademark, and dispositive of many open issues in the field of Internet commerce and speech, might very well continue for a decade.
10. That Public Citizen might well be unable and/or unwilling to provide her with representation until the resolution of such an extended course of litigation.

He goes on to chide Levy and Public Citizen for "leaping to the defense of someone who is in league with a person who has harnessed the lowest impulses of puerile, vituperative Internet youth to generate a Charitable Fund that has been used to bribe two major charities into tacitly endorsing a campaign that is utterly devoid of charitable purpose, and is a mere cover for a hate campaign."

Uh, yeah. At best, this demonstrates that Carreon still has no clue about what's happening. He still thinks that there's some big campaign against him, and he's still lashing out without realizing that every time he does so he just draws more negative attention to himself. Most people tend to learn that when doing something makes the situation worse, they shouldn't keep doing it. Carreon seems unable to make that basic connection. The rather blatant threats against the blog owner -- to go after her in multiples jurisdictions and at a later date when Public Citizen might not be able to take her case -- are examples of the exact wrong way to handle something like this. It's an old-fashioned lawyer attitude: take an extreme position that you can back down from later. But in this case, it just seems to display -- quite vividly for the judge -- Carreon's true intentions: to be such a nuisance that people stop mocking him. One of these days, he may discover that each time he does that, he's only encouraging more and more ridicule.

Oh, and in the meantime, as for his attempt at getting a temporary restraining order to stop the money raised from being distributed, the judge has asked for proof that the charities have received the money -- as has been stated by IndieGoGo and Matthew Inman. If that is shown to be true, it seems likely that the judge will find no reason to consider the TRO request any more, since it's meaningless.