We just noted how the procedural delays in the case against Kim Dotcom meant that it was more difficult for him to fight back against the US government. In response to all of this, Dotcom is offering the Justice Department a deal. He will come to the US and defend the case here if it agrees to unfreeze assets specifically to allow him to fight the case (i.e., pay lawyers and living expenses during the trial). In other words, he’s willing to skip the extradition fight and believes he can win in a US court, if they’re willing to actually let him access the money to pay for the defense. As he told the New Zealand Herald:
He said he would willingly go to the US if he and his co-defendants were given a guarantee of a fair trial, money to pay for a defence and funds to support themselves and their families.
“They will never agree to this and that is because they can’t win this case and they know that already.”
This is an interesting move, because it’s entirely possible that the DOJ will call his bluff here. Certainly, some of the strength in Dotcom’s case is that he wasn’t violating New Zealand law (which is required for the extradition to take place). A fight in a US court, against the DOJ, is a much tougher proposition — and a very risky bet. There are a lot of reasons why Dotcom may have a strong case, but the DOJ rarely loses. It happens, but it’s rare. Even in extreme cases, the DOJ is pretty good at railroading those they indict to “plea” out of a case rather than face a full trial.
Yesterday, we wrote about how Lamar Smith was rushing through a new bill that looked to approve a piece of SOPA that would spend taxpayer money to expand the diplomatic corp with a bunch of people whose job it would be to spread Hollywood’s special copyright interests around the globe… and to set up a special agency for this in the Commerce Department. Despite the public rebuke Lamar Smith got for his efforts to write SOPA in secret and then to rush it through, he apparently didn’t learn much and chose to do this bill the same way. It was put on the schedule to be marked up without the bill even being announced — basically a way to rush it through in secret.
It appears that this plan is falling apart. The markup did not happen this morning, and we’re hearing that support for the bill is wavering. Some of the named co-sponsors have made it clear that they’re just as unhappy that the bill was being rushed out this way without public comment and were uncomfortable with some of the specifics in the bill — and that these concerns mean that the bill may actually be delayed. It may be a very temporary delay, but it does sound like some of the “co-sponsors” may have changed their minds and won’t be supporting the bill. And, for the time being, the markup has been called off.
There is still a lot of back and forth going on, and it’s still important to speak up. Public Knowledge pointed out that the House Judiciary Committee and Lamar Smith need to learn that secret bills are a non-starter, and they’re absolutely right.
Before getting to the substance of the bill, perhaps the most shocking thing about it is how it is being handled by Committee Chairman Smith (who was a driving force behind SOPA). If Congress learned no other lesson from SOPA and PIPA, you would think that they got the message about not developing IP-related laws in secret. But you would be wrong. This bill leaked, fully formed, over the weekend and was scheduled for markup today. Needless to say, this came as a surprise to just about everyone not directly involved with drafting it and provided a very limited opportunity to meaningfully participate in the markup process. Step zero for any new IP bill should be a transparent drafting process.
Given that this is still a highly fluid situation, if you’re represented by any of the members of the House Judiciary Committee, you might want to give them a call and let them know that you opposed SOPA and you’re shocked that the HJC might push through a piece of SOPA in a process that was even more secretive than the one for SOPA itself.
Another era of building McMansions probably won’t be coming again anytime soon. Big houses built quickly and somewhat cheaply aren’t in much demand nowadays. But there are a few designers who are working on really small houses (that could almost fit in a McMansion closet). Here are just a few examples of some extremely tiny living spaces that look nicer than you might expect.
In the arguments over ACTA, one criticism seemed widely accepted: that it tries to bundle together two quite different challenges — tackling counterfeit goods, like fake medicines, and dealing with unauthorized file sharing. One popular suggestion was that ACTA should be split in two in order to handle those separately – for example, David Martin, the politician who played a key role in convincing the European Parliament to reject ACTA this week, supports this approach.
A New York federal court has ordered a rare default judgment in favor of John Wiley & Sons, one of the world’s largest book publishers. Robert Carpenter from Poughkeepsie, New York, has been ordered to pay the publisher $7,000 in damages for sharing a copy of “WordPress All-in-One For Dummies” on BitTorrent. According to Judge William Pauley, the man is guilty of both copyright and trademark infringement.
The judge specified that $2,000 of those damages were “for Carpenter’s counterfeiting of Wiley’s Trademarks”. As TorrentFreak notes:
To our knowledge, this is the first time that sharing files on BitTorrent has been viewed as counterfeiting, a description that’s usually reserved for fake goods sold as the real deal.
That’s troubling, because it would seem to open the door for anti-counterfeiting measures aimed at tackling serious trademark infringement to be applied routinely to P2P sharing of copyright files simply because they are exact copies of originals. That, in its turn, would mean that separating ACTA’s measures against counterfeit goods from those dealing with online infringement might not be enough to solve the treaty’s problems, since the former would still apply to the digital world. Yet another reason to bin ACTA completely and to start again from scratch.
Two and a half years ago, Universal Music (UMG) sued Grooveshark (or, really, its parent company Escape Media). The case has had a few twists and turns since then, but the judge has issued a ruling (embedded below) that is pretty clear in suggesting that Universal Music’s key argument — the the DMCA does not apply to pre-1972 songs — was a massive overreach, and the court will not accept it. Separately, the court flat-out rejected UMG’s attempts to have Grooveshark’s counterclaims of tortious interference dismissed. There’s no way to look at this other than a pretty big win for Grooveshark and a big loss for Universal, though the case is far from over.
On the key point, Grooveshark has long argued that what it does is really no different than what YouTube does, in that it allows individuals to upload content, and if it receives a takedown notice, it proactively follows the DMCA’s takedown process and removes that content. Realizing that getting around the DMCA’s safe harbors was a longshot, Universal Music instead reverted to a somewhat twisted argument, saying that pre-1972 sound recordings are not covered by the DMCA, and thus there are no safe harbor protections. To understand why they’d make this argument, you can read up on the history of pre-1972 copyrights for sound recordings — a huge mess that the US Copyright Office is still trying to figure out how to fix. But, the short version is that, currently, sound recordings from before 1972 are not technically under US federal copyright law, but various (and often crazy) state laws. Since the DMCA refers to works under federal copyright law, Universal Music’s arguments is that the DMCA doesn’t apply, thus the safe harbors don’t apply, and Grooveshark can’t rely on its safe harbor compliance to avoid liability.
If this argument sounds somewhat familiar, that’s because it’s the same one EMI tried to use against MP3Tunes, which failed spectacularly. The NY state court in this case appears to be well aware of that, citing the MP3Tunes case at length.
An internet service provider which seeks to benefit from the safe harbor provisions of the DMCA is required, as a condition of receiving such protection, “expeditiously to remove, or disable access to, the material that is claimed to be infringing or to be the subject of infringing activity.” …. Certainly the thrust of the DMCA is to relieve internet service providers of the initial need to ascertain the copyright status of the sound recordings that they make available, to place the burden of asserting copyright ownership on the owners of such copyrights, and to require the internet service providers to “take down” infringing material, upon receipt of a valid notice of infringement. There is no textual, or other reason, to think that Congress intended to limit that distribution of responsibilities to only post-1972 recordings.
Moreover, the phrase “copyright owners,”…. is applicable to the owner of a common law copyright, no less than to the owner of a copyright under the Copyright Act….
End result? Sorry, UMG, but you can’t just use this loophole to get around the clear and stated purpose of the DMCA’s safe harbors.
This Court is not attempting to extend the Copyright Act to pre-1972 Recordings, but, nonetheless, does find, based on the relevant language of the statutes and the analysis discuss above, that the safe harbor provision codified by section 512(c)(1) of the DMCA is applicable to Pre-1972 Recordings.
That shoots a pretty big hole in UMG’s case, as it’s now going to have to show that Grooveshark’s activities cause them to lose DMCA safe harbors, which is a much bigger hill to climb.
Separately, UMG failed in trying to get various counterclaims dismissed. The focus here was on claims that UMG contacted two companies — HP and INgrooves — to get them to back out of deals with Grooveshark. There are a bunch of different arguments (most pretty technical) that UMG makes to assert that these counterclaims should be dismissed, but the court isn’t buying most of them. For each precedent UMG brings up, the court highlights that the facts are different here and UMG’s reliance on particular caselaw “is misplaced.”
UMG had a couple of relatively minor victories: having one of the counterclaims dismissed (one having to do with antitrust activity, because Grooveshark only showed harm to itself, rather than competition in general) and also a rejection of an attempt to use Section 230 safe harbors, which explicitly carve out intellectual property. Grooveshark/Escape Media tried a rather convoluted argument (sort of the reverse of UMG’s pre-1972 DMCA argument, claiming that Section 230 safe harbors could apply to works covered under state copyright law). The court rejects this as silly, but it’s effectively meaningless since it still grants the DMCA’s safe harbors (which, admittedly are not quite as strong as the Section 230 safe harbors, but this is definitely the more reasonable result).
All in all, there’s still a long way to go in this case, but today’s ruling is clearly a pretty big loss for UMG and a win for Grooveshark.
The latest news in the world of copyright-trolling porn companies is that one of the people that the porn world tried to shake down with a trolling attempt has hit back with a racketeering lawsuit, which she’s trying to turn into a class action. The woman, Jennifer Barker, received a call from someone claiming to work for a law firm (though, in the lawsuit, Barker says she actually works for a third party) demanding a “settlement” payment to avoid being named in one of the lawsuits in Florida (the new favorite for copyright trolls due to some oddities in the law). The caller, like many copyright-trolling porn attempts, played up the fact that it would be embarrassing to be named in a lawsuit for downloading porn. Barker claims she never downloaded the porn and has no clue what BitTorrent is, and — quite reasonably — felt that she was being extorted.
From the lawsuit:
Ms. Hansen demanded that Ms. Barker pay money to settle the lawsuit or she would be identified publicly as having downloaded pornography and would be subject to hundreds of thousands of dollars as a judgment if the suit went forward because there were multiple downloads. Numerous individuals on the Internet report receiving a phone call from the same telephone number as that provided by Ms. Hansen to Ms. Barker with a demand that they pay money to settle a lawsuit against them.
Ms. Barker refused to pay any money because she did not know what BitTorrent was and had never downloaded any pornography from the Internet. On information and belief, many other members of the class have paid sums of money in settlement with the pornography purveyors even though they had never downloaded any pornography from the Internet, and certainly had never unlawfully downloaded any pornography from the Internet.
Subsequently, Ms. Hansen and others associated with her called Ms. Barker’s place of employment and left messages on the voicemail to which several of Ms. Barker’s co-workers also had access and continued to contact Ms. Barker on her personal telephone. Class members have been subjected to the same or similar treatment.
This is hardly the first attempt to use racketeering/RICO laws to counter copyright shakedowns, but to date, most have not been very effective. There is the ongoing lawsuit by Dmitriy Shirokov against US Copyright Group and its parent company Dunlap, Grubb & Weaver, but that was a really fact-specific case, involving the fact that the copyright holder (Uwe Boll) had failed to register the copyright in question in the US in a timely manner, leading to some specific legal questions.
There were also similar attempts to bring a class action racketeering case against the RIAA for its own practice of suing end users for allegedly making works available on file sharing networks. Those lawsuits flopped pretty badly, though.
Again, the case seems to allege some pretty specific facts that potentially could distinguish it from those other ones in the past, though it seems like a pretty massive longshot. The filing focuses on the use of the telephone to seek the money, claiming that it was “wire transmission in a scheme or artifice to attempt to fraudulently obtain money from another” under the law. But, that’s actually a pretty high bar to meet, and the porn companies can and will argue that they weren’t trying to “fraudulently” obtain money, but legitimately do so. I’d be surprised if the courts allowed this one to go very far.
As we announced a few weeks ago, the July Techdirt Book Club book is Year Zero written by Rob Reid and which comes out today, published by Random House. Rob will be joining us in a few weeks to talk about writing a comic sci-fi novel about the mess that is copyright law… but in the meantime, he’s provided the following excerpt, which is Chapter 1. There is a “prologue” before this, which you can read here, or you can just watch this video, which more or less covers the prologue info:
As part of this, Rob and Random House have agreed to do another give away, this time just for Techdirt readers, which will go to five commenters on this post, based on your voting scores on the comments. We’ll give one copy of the book each to the highest ranked “funny” and “insightful” comments, and then the three highest total scores other than the top ranked (so either funny or insightful). There are a few conditions: you have to be in the US or Canada. I know this sucks for those of you not in those places, but there’s nothing we can do about it. Also, to win, we obviously have to be able to contact you, which means (a) you need to be logged in when you comment, so we can email you and (b) you have to respond to our email informing you of your win within 24 hours of our email. Also, you can’t win twice — if you score the highest in multiple categories, you get a prize in one and the others will go to the runners-up. We’ll keep the voting open until Wednesday night and then tally the votes. So, get to work with your funny/insightful comments…
CHAPTER ONE: ASTLEY
Even if she’d realized that my visitors were aliens who had come to our office to initiate contact
with humanity, Barbara Ann would have resented their timing. Assistants at our law firm clearout at five-thirty, regardless — and that was almost a minute ago.
“I don’t have anyone scheduled,” I said, when she called to grouse about the late arrival. “Who is it?”
“I don’t know, Nick. They weren’t announced.”
“You mean they just sort of . . . turned up at your desk?” I stifled a sneeze as I said this. I’d been fighting a beast of a cold all week.
This was odd. Reception is two key-card-protected floors above us, and no one gets through
unaccompanied, much less unannounced. “What do they look like?” I asked.
“Lady Gaga strange?” Carter, Geller & Marks has some weird-looking clients, and Gaga flirts with the outer fringe, when she’s really gussied up.
“No–kind of stranger than that. In a way. I mean, they look like they’re from . . . maybe a couple of cults.”
From what? “Which ones?”
“One definitely looks Catholic,” Barbara Ann said. “Like a . . . priestess? And the other one
looks . . . kind of Talibanny. You know — robes and stuff?”
“And they won’t say where they’re from?”
“They can’t. They’re deaf.”
I was about to ask her to maybe try miming some information out of them, but thought better of it. The day was technically over. And like most of her peers, Barbara Ann has a French postal worker’s sense of divine entitlement when it comes to her hours. This results from there being just one junior assistant for every four junior lawyers, which makes them monopoly providers of answered phones, FedEx runs, and other secretarial essentials to some truly desperate customers. So as usual, I caved. “Okay, send ’em in.”
The first one through the door had dark eyes and a bushy beard. He wore a white robe, a black turban, and a diver’s watch the size of a small bagel. Apart from the watch, he looked like the Hollywood ideal of a fatwa-shrieking cleric — until I noticed a shock of bright red hair protruding from under his turban. This made him look faintly Irish, so I silently christened him O’Sama. His partner was dressed like a nun — although in a tight habit that betrayed the curves of a lap dancer. She had a gorgeous tan and bright blue eyes and was young enough to get carded anywhere.
O’Sama gazed at me with a sort of childlike amazement, while the sister kept it cool. She tried to catch his eye — but he kept right on staring. So she tapped him on the shoulder, pointing at her head. At this, they both stuck their fingers under their headdresses to adjust something. “Now we can hear,” the nun announced, straightening out a big, medieval-looking crucifix that hung around her neck.
This odd statement aside, I thought I knew what was happening. My birthday had passed a few days back without a call from any of my older brothers. It would be typical of them to forget — but even more typical of them to pretend to forget, and then ambush me with a wildly inappropriate birthday greeting at my stodgy New York law office. So I figured I had about two seconds before O’Sama started beatboxing and the nun began to strip. Since you never know when some partner’s going to barge through your door, I almost begged them to leave. But then I remembered that I was probably getting canned soon anyway. So why not gun for YouTube glory, and capture the fun on my cellphone?
As I considered this, the nun fixed me with a solemn gaze. “Mr. Carter. We are visitors from a distant star.”
That settled it. “Then I better record this for NASA.” I reached across the desk for my iPhone.
“Not a chance.” She extended a finger and the phone leapt from the desk and darted toward her. Then it stopped abruptly, emitted a bright green flash, and collapsed into a glittering pile of dust on the floor.
“What the . . . ?” I basically talk for a living, but this was all I could manage.
“We’re camera shy.” The nun retracted her finger as if sheathing a weapon. “And as I mentioned, we‘re also visitors from a distant star.”
I nodded mutely. That iPhone trick had made a believer out of me.
“And we want you to represent us,” O’Sama added. “The reputation of Carter, Geller & Marks extends to the farthest reaches of the universe.”
The absurdity of this flipped me right back to thinking “prank” — albeit one featuring some awesome sleight of hand. “Then you know I’ll sue your asses if I don’t get my iPhone back within the next two parsecs,” I growled, trying to suppress the wimpy, nasal edge
that my cold had injected into my voice. I had no idea what a parsec was, but remembered the term from Star Wars.
“Oh, up your nose with a rubber hose,” the nun hissed. As I was puzzling over this odd phrase, she pointed at the dust pile on the floor. It glowed green again, then erupted into a tornado-like form, complete with thunderbolts and lightning. This rose a few feet off the ground before reconstituting itself into my phone, which then resettled gently onto my desk. That refuted the prank theory nicely — putting me right back into the alien-believer camp.
“Thank you very kindly,” I said, determined not to annoy Xena Warrior Fingers ever, ever again.
“Don’t mention it. Anyway, as my colleague was saying, the reputation of Carter, Geller &
Marks extends to the farthest corner of the universe, and we’d like to retain your services.”
Now that I was buying the space alien bit, this hit me in a very different way. The farthest corner of the universe is a long way for fame to travel, even for assholes like us. I mean, global fame, sure — to the extent that law firms specializing in copyright and patents actually get famous. We’re the ones who almost got a country booted from the UN over its lax enforcement of DVD copyrights. We’re even more renowned for our many jihads against the Internet. And we’re downright notorious for virtually shutting down American automobile production over a patent claim that was simply preposterous. So yes, Earthly fame I was aware of. But I couldn’t imagine why they’d be hearing about us way out on Zørkan 5, or wherever these two were from.
“So, what area of the law do you need help in?” I asked in a relaxed, almost bored tone. Feigning calm believably is a survival tactic that I perfected as the youngest of four boys (or of seven, if you count our cousins, who lived three doors down. I sure did). It made me boring to pick on — and useless as a prank victim, because I’d treat the damnedest events and circumstances as being
mundane, and entirely expected. It had also helped me immensely as a lawyer (although by itself, it had not been enough to make me a successful one).
Sister Venus gave me a cagey look. “It’s sort of . . . an intellectual property thing.”
Hipmunk, if you’re unfamiliar with it, is a wonderful travel search site, which really thought hard about how to make searching for flights and other travel info much more useful and intuitive. For me, personally, it’s almost entirely replaced other sites like Expedia. A few weeks back the company announced on its blog that it had received $15 million in funding and also mentioned that it was doing okay in the revenue department. These days, that’s both a sign for celebration… and blood in the water for patent trolls. I recently spoke to a lawyer for a decently large startup that isn’t making any revenue, who has said that he’s been contacted by patent trolls, who basically just keep circling, saying they won’t sue until his company is making money, and then they’ll pounce. It appears something similar happened with Hipmunk.
Just days after the announcement, a “company” (and I use that term loosely) called i2z contacted them, demanding they obtain a license, according to a report by Jeff Roberts. i2z is already suing a ton of travel/location companies, including Google, Travelocity, TripAdvisor, Yelp and more in Delaware (while not as famous as Eastern Texas for patent lawsuits, Delaware has been getting some attention as a “favorable” venue for patent trolls). It has also sued Hotels.com in a separate action… in Texas (northern district, not eastern) and Microsoft in Oregon. Of course, i2z (like so many patent trolls) appears to just be a patent lawyer, based in California: Rakesh Ramde.
The patent in question (5,345,551) covers a “Method and system for synchronization of simultaneous displays of related data sources.” It was originally issued all the way back in 1994 to Brigham Young University… who held onto it until just about a year ago when it was assigned to “Gregory Cuke” who appears to be a real estate guy in Longview, Texas. And, yes, it turns out that i2z, despite actually being a lawyer in California, is technically based in Longview, Texas. Ramde claimed that Hipmunk violated claim one of the patent, which reads (in its entirety):
1. A system for synchronizing the presentation of data on a digital computer display, comprising:
first and second window-controlling means, each of said window-controlling means displaying information in at least one display window,
a synchronization control means, and
means for communications between said synchronization control means and each of said first and second window-controlling means;
wherein said first window-controlling means displays first information from a first source, and said second window-controlling means displays second information from a second source;
wherein said first information and said second information have sections, and at least one section of said second information corresponds to a section of said first information;
wherein said first window-controlling means sends a message to said synchronization control means over said means for communications indicating a change in viewing position to a new section of said first information;
wherein said synchronization control means sends a message to said second window-controlling means over said means for communications requesting a change in viewing position to a section of said second information corresponding to said new section of said first information; and
wherein said second window-controlling means displays said corresponding section of said second information on at least one display window.
In response, rather than letting i2z shop for its favorite forum, Hipmunk went to court in Northern California, asking for a declaratory judgment saying that (1) Hipmunk does not infringe and (2) the patent isn’t valid anyway. On that first point, it seems that Hipmunk has a reasonably strong argument, since the whole point of the claim seems to involve multiple windows, and Hipmunk displays everything in a single window.
Either way, this is the kind of crap that tons of companies face. The second they’re deemed even slightly successful, they get hit with patent infringement claims from non-practicing entities, wielding broad and vague patents that have nothing to do with what the company is really doing. And people still don’t think this is a problem?
Earlier today, we wrote about the city of Washington DC working on a a bill that would require startup car service Uber to charge five times as much as a cab, arguing that they need to regulate what is considered a “premium class.” They don’t explain why one needs to regulate what’s premium and what’s not, but that’s what you get in a massively regulated/anti-competitive market. The public outcry over this regulation, however, has resulted in the Councilmember who wrote the amendment, Mary Cheh, backing down and shelving it.
As we noted in our earlier post, Cheh had said all along that the amendment was actually an attempt to legalize Uber, after a Taxicab Commission “sting” earlier this year, which claimed that Uber was acting illegally. In response to all of this, Cheh seems upset, since she says that she worked with Uber to create the amendment, and was blindsided by the criticism:
“Several months ago, Uber contacted me and asked to work together to legalize services like Uber in the District… Since then, I have met with Uber many times, negotiated in good faith, and believed that I had reached an agreement with them last week.”
Others have suggested that parts of the amendment could be acceptable if they remove the minimum pricing rules. Uber, for its part, claims that it’s always believed the service was legal in DC, so it never believed that the amendment was needed to “make it legal.” For what it’s worth Uber clearly has benefited from this fight, as it drew an awful lot of publicity to the company’s presence in DC (and elsewhere). Either way, it seems difficult to see how regulating a high price benefits Uber.
And, in the end, what you’re left with are questions about why taxi licensing needs to be so restrictive and so all-encompassing. Are there concerns about keeping passengers from being ripped off and keeping them safe? Sure, but there seem to be ways to deal with that which don’t involve entirely regulating every aspect of the market, limiting competition and setting the actual pricing. But, in the end, as we’ve seen in other markets, those in regulated markets tend to figure out ways to use the regulations to their own advantage…
Ah, the insanity of music licensing. There’s apparently a biopic of Jimi Hendrix being made, starring Andre Benjamin (better known as Andre 3000 from Outkast) in the leading role. Of course, with a Hendrix biography, you’d think that the real star would be the music — but in this case, there won’t be any original Jimi Hendrix music in the entire movie, because Hendrix’s estate has said that it won’t license songs unless it has some sort of say in the production. The producers don’t want that, so they didn’t even ask to license the music. The film, instead, will make do with new versions of cover songs that Hendrix did along the way.
This is, in many ways, ridiculous. Part of the point of recording and retelling our cultural heritage is the use of the actual music that made it happen. Even the Hendrix estate finds the moviemakers’ position confusing (though, it doesn’t indicate if it would license the songs without creative say in the flick). Part of the problem is the ridiculous setup of music licensing today. You can do a cover song with compulsory licenses (i.e., without permission), but that’s only for audio. Doing video gets you into sync licenses and other issues that require permission. And this is what you get in a society that locks up culture: a movie about Jimi Hendrix that features exactly none of his original music.