File Sharing, Damages And The Constitution...

from the getting-into-the-legal-weeds dept

Doug Lichtman is a well known intellectual property law professor who is a fairly big supporter of the copyright system. He's reached out to us, because of a podcast he recently recorded discussing the Joel Tenenbaum lawsuit. To be honest, I'd pretty much stopped covering anything to do with that lawsuit, because over the last couple of months, it's turned into something of a circus side-show, with both sides running around and making decisions as if they've never actually been in a court of law before. Even the judge has been making mistakes.

However, Lichtman specifically was hoping for the perspective of folks around here on the podcast, because (as he noted in his email), most of his listeners tend to be strongly pro-copyright, and he was hoping to at least find out what those of us less sure of the benefits of copyright think. To be honest, after listening to the podcast twice, it may be a bit too down in the legal weeds for many readers here -- though, if you really are interested in the legal specifics, have a listen. The first part involves Lichtman talking to Charles Nesson himself about the case, followed by three "legal experts" and then a guy from the RIAA who seems to honestly believe that the RIAA's lawsuit strategy was a success because it taught more people that file sharing was illegal. This is wrong on many different levels, since it clearly didn't impact user behavior, and has created other problems, such as the false belief in some that all file sharing is illegal (even of authorized content) and has framed the RIAA as being anti-consumer, making it that much harder for the major record labels to eventually make the shift in business models that are necessary to succeed these days.

The overall "conclusion" that Lichtman comes to is that Nesson and Tenenbaum are likely to lose the case, as precedent suggests that courts will likely find the statutory damages in the copyright act to be within the range of being constitutional. I actually agree that this is the likely outcome, though I find it, and the reasoning behind it, quite troubling. I also hope that, when (if) the case really goes to trial, Nesson has worked up a better argument than he gave on the podcast. While he does raise some good points, a lot of it feels like he only has a superficial understanding of both what's happening and the law itself. When really pressed on legal issues by Lichtman, he resorted to an emotional argument ("it's just a kid clicking on links!") which hardly is legally compelling.

However, in listening to the "experts," it sounds like it would be possible to make a more compelling case against the statutory rates by pointing out some rather simple facts: file sharing, in and of itself, creates no damage for artists -- and thus, the statutory rates have nothing to do with being a "remedy," but have everything to do with being punitive, which would make it a criminal issue, rather than a civil one.

Now, I can hear the copyright supporters (including Lichtman) shouting that it's ridiculous to claim that file sharing creates no damages for the artists -- but that's not what I said. I said, file sharing in and of itself creates no damage. And that's easily proven: just point to the increasingly large number of artists who have embraced file sharing on purpose and who have found that it's helped them earn more money. Then, what you realize is that file sharing combined with a bad business model may create damages, but those damages may be alleviated by putting in place a better business model (again, pointing to evidence of artists who have done exactly that). At that point, the "damages" have gone away. The fault is almost entirely on the part of the artist who picked a bad business model, and then did nothing to alleviate the problem when it became clear that the market was going in a different direction.

In that case, there's no actual evidence of damages, and it's difficult to see the constitutionality of charging someone $750, let alone $150,000, when there's no actual evidence of damages -- and the only actual "damage" may have been caused by the artist themselves by picking a bad business model.

Part of my problem with all of these discussions is that copyright supporters seem to automatically assume that file sharing must be bad -- but there's plenty of evidence to counter that, with artists' wide embrace of it (successfully in many cases) being exhibit A. If file sharing was really so damaging, there would be no such examples. But we see more and more every day. So it's not file sharing that's the problem. The real problem is a bad business model combined with file sharing. And it's rather ridiculous to fine Joel Tenenbaum (or anyone) because some record labels and musicians chose a bad business model.

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  1. identicon
    Rekrul, 19 Mar 2009 @ 10:37pm

    The bottom line is this;

    Digital content is much more convenient than physical copies of the same thing. A person can fill an MP3 player with more music than a duffle bag full of CDs, and still have it fit in their pocket. Using standard 700MB AVI files for movies, a person can easily put a couple dozen movies on a laptop for watching while traveling. It's also more convenient because there is such a wide range of devices they can be played on. You can play music and movie files on virtually any modern computer, regardless of what brand it is, or what OS it uses. The files can be backed up an infinite number of times, ensuring that you can easily keep your content virtually forever. Finally, since distribution of digital content is cheap and easy, huge libraries of content can easily be put online for next to nothing, as evidenced by the huge volume of content available on the file sharing networks.

    Unfortunately, the music and movie industries still haven't realized all of this. They insist that physical copies are still the core of their business. They've taken a few small steps, but have mostly crippled their offerings, making them unattractive to potential customers.

    They add DRM that restricts where and when people can play the files, often locking them to specific hardware. They place restrictions on backing up the files, preferring instead to offer re-downloads, often only for a limited time. They charge prices that are out of line with the actual costs of distributing digital. Finally, they only allow access to a portion of their catalogs, while keeping all the older, more obscure content (which is exactly the kind of stuff that should benefit from the digital age) locked up where nobody can access it.

    Of course, some of this is due to the ridiculous licensing schemes that they've forced into law. Why must WKRP in Cincinatti be butchered for the video release? Licensing. Why did it take 15 years for the movie Heavy Metal to be released to home video? Licensing. Why won't networks open up their vaults and make on-demand copies of old TV shows that will probably never be released on DVD? Licensing.

    If iTunes can become a success "selling" DRM-crippled music and video files that make people jump through hoops to use them, don't you think DRM-free files in standard formats would be even more successful? Sure, they'd get pirated, but that happens now anyway, only the source is different. Piracy wouldn't get worse, but people would have a legal alternative that offers them the same "product" without any of the legal risk.

    When buying an MP3 of a song or an AVI of a movie is as easy and hassle-free as buying a physical copy, piracy will diminish (but not vanish). Until then, people will continue to seek out what the companies refuse to give them.

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