Why Arguing That Google Is In The Best Position To Stop Infringement Is Wrong

from the it's-not-and-it-makes-no-sense dept

While we did cover Google/YouTube's own filing in Viacom's appeal of YouTube's victory at the district court concerning its liability for infringing videos on the site, we did not cover the various "friend of the court" (amici) briefs filed by a variety of folks in support of YouTube's argument. If you'd like to see them all, Michael Barclay has put them all together in a single page, including his own (excellent) analysis of the key points raised in the briefs. Eric Goldman also does a nice job discussing many of the briefs and the key issues raised by them. If you want to understand what people are saying, read those two pages, and you should be in great shape (though, if you were reading both of their blogs already -- as you should -- you'd already be ahead of the game).

However, I did want to focus in on one particular brief, by law professor Michael Carrier, author of an excellent book on innovation (and how the law interferes with innovation), addressing the issue of "least cost avoidance," when it comes to stopping copyright infringement (pdf and embedded below).

It's one of the key arguments often made by content industry folks in arguing that tech companies and ISPs should be responsible for somehow policing their systems for infringement: that those service providers are in the best position to stop the infringement. For many years, we've always explained why this didn't make sense from a pure liability standpoint. These service providers aren't the ones doing the infringement and thus -- fundamentally -- it makes little sense to pin the liability on a party that didn't perform the law-breaking action. The response from the content industry is often to point to the concept of the "least-cost-avoider principle," which shows up in various aspects of the law, in which courts will sometimes shift liability around to put it on those in the best position to stop the law breaking at the lowest cost. And, in fact, this was found in some of the arguments supporting Viacom.

Carrier's amicus brief does a wonderful job debunking the argument. He does brush over a key point, that I wished got more attention: that it's incredibly unlikely that the service providers really are the least-cost-avoiders in these circumstances, since they have no clue what's really infringing and what's not (as demonstrated by Viacom's own confusions over staff members uploading promotional clips to YouTube...). However, for the purpose of making his point, he goes even further, suggesting that even if it's true that YouTube would be the least-cost-avoider, such a least-cost-avoider makes no sense in the context of copyright and innovation.

The brief points out that least-cost-avoider rules are used in tort law, in particular involving accidents -- which are situations in which no beneficial externalities are created as a result:
In these settings, lowering the costs of preventing accidents makes sense. Accidents do not offer any benefits for society. And the only downside to requiring actors to prevent accidents is that their costs will increase.

More important, requiring parties to take measures to reduce accidents will not have detrimental effects on third parties. No third parties will suffer collateral consequences if a driver is forced to slow down to the speed limit. Or if a barge fortifies its hull to prevent oil spills. Or if a manufacturer reduces the use of asbestos in its products. In short, the harms from the application of the least-costavoider principle in tort law are observable and do not threaten adverse unanticipated effects across other sectors of the economy.
But that's not the case in copyright law. In copyright law, infringing on copyright may certainly hurt some parties, but it also creates positive externalities and can lead to certain innovations. In fact, entire books have been written on how infringement is often a driver of innovation. Thus, taking the "least-cost-avoider" principle (even assuming it's true, which remains in question) could potentially cause serious harm:
The least-cost-avoider standard would result in innovative technologies becoming less useful and more cumbersome. Application of such a standard would have made some of today's leading technologies just a shadow of the invaluable innovation they ultimately became. For example, courts could have required photocopier manufacturers to modify their copiers to prevent the copying, absent a copyright owner’s approval, of "any document displaying a ©."
The brief goes on to note that, to copyright holders, pretty much every disruptive innovation first appears as some evil form of infringement that must be stopped. Applying this kind of principle would likely have stifled all sorts of beneficial technologies before they could have gotten off the ground.
It is understandable--if short-sighted--to not recognize the benefits of disruption. But it is not appropriate to reengineer the law to block disruptive innovation. The Constitution promotes the "Progress of Science and useful Arts." It does not guarantee that copyright owners are entitled to protect their existing business models against the onslaught of innovation.

The disruptive innovation unleashed by new technologies reveals the difference between tort law and copyright law in the application of the least-cost-avoider standard. There is no legitimate fear in tort law about eliminating valuable activity from society by overdeterring fast drivers or brittle boat hulls filled with gasoline. In contrast, there is monumental concern with stifling disruptive innovations by saddling them with the burdens of copyright owners.
In other words, even if we assume that service providers are the lowest cost providers of stopping infringement, that doesn't mean that's the best way to "Promote the Progress of Science and useful Arts." There's a lot more in the brief, but wanted to post this as a key piece of the puzzle in responding to claims that it makes sense to put the burden on service providers based on such a principle. While I tend to disagree that service providers are the least cost avoiders in the first place, even if they are, the potential net harm on innovation they can cause should be a huge concern in shifting liability.

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  1. identicon
    Anonymous Coward, 20 Apr 2011 @ 11:47am

    Frankly, I find the amicus far from compelling, and have to wonder why it was even submitted in the first place.

    The question before the appeals court is how should 512(c)(1)(A)(ii) be interpreted? This is what is referred to in some circles as the "Red Flag" provision.

    I could find nothing in the amicus that shed any light on how this question should be resolved. If fact, in some regards the amicus is misleading in suggesting that the case involves a rights holder shedding all costs of compliance onto the backs of service providers, which is simply not the case.

    Takedown procedures remain intact, and the burden (both time and cost) of such procedures rest almost entirely on rights holders, with the burden on service providers being quite minimal and easily handled using a virtually automated system.

    Here, however, we are dealing with the "Red Flag" provision and asking an entirely different question. At what point is apparent infringment so ubiquitous that a service provider should be called upon to shoulder a greater share of the burden?

    I do not profess to know the answer, but in my view the district court opinion places all significant responsibility and associated costs on rights holders, rendering the "Red Flag" provision virtually meaningless.

    In the non-internet world hosts are held accountable in certain limited instances. Is it a fair solution in the internet world that a different set of rules should apply?

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