In the past, we've discussed the idea of "soft corruption" a few times -- which in some ways can be more nefarious than out and out corruption. In soft corruption, it's not what most people normally think of as corruption (i.e., cash for getting something from politicians), but merely something that presents the very strong appearance of influence buying. It involves situations where even if everything being done is legal and done for the right intentions, the mere appearance of the conflict reduces the public's trust in government. Earlier this week, we wrote about how the House Judiciary Committee, which claims to be working on a major copyright reform effort, held "listening tours" in both Silicon Valley and Los Angeles (unfortunately, reinforcing the idea that copyright is a "Hollywood v. Silicon Valley" concept). As we noted, however, we were pleasantly surprised at the Silicon Valley hearing, that the discussion seemed really positive. It was (a) focused on actual ideas that could be implemented and (b) the members of the Judiciary Committee really seemed open to lots of good ideas.
From reports I've heard, the LA listening tour was also pretty good, minus one silly, but expected, flareup involving someone accusing Google of being a criminal pirate enterprise. However, in a move that seems fairly sketchy, following the hearing, the Committee members who were there had dinner with the MPAA. And, in Politico's latest report it notes that the head of the Judiciary Committee, Rep. Bob Goodlatte, hung around an extra day in Southern California to put his name on and attend a fundraiser for his colleague Rep. Kevin McCarthy.... put on by the MPAA:
Rep. Bob Goodlatte didn't just bring lawmakers to Silicon Valley and Los Angeles this week to talk with tech companies and content creators about the future of copyright. The House Judiciary Committee chief also offered his name and support to a fundraiser for House Majority Leader Kevin McCarthy and the National Republican Congressional Committee, hosted last night by the MPAA, according to an invite snagged by MT.
The event, a cocktail reception and dinner at the BOA Steakhouse in West Hollywood, asked for checks to be made out to the McCarthy Victory Fund, a joint fundraising committee with the NRCC, according to a Goodlatte aide. But the Judiciary chairman, who was slated to attend, extended the help a day after he and other lawmakers visited Hollywood to talk tech policy and later dined with the MPAA. A spokeswoman for the congressman added it was Goodlatte's only fundraising event while out in California
And, yes, if he had done a similar thing up in Northern California with tech folks, it would be equally concerning. I know the cynical folks who read this won't accept this, but I actually do believe that Goodlatte is trying to come up with a reasonable plan for copyright reform that actually takes all the issues into account. While I don't always agree with him, I've found him to be a lot more open to understanding these issues than some of his colleagues. But... that said... this is the kind of thing that most people will see and reasonably think that it undermines Goodlatte's trustworthiness on issues like this. It certainly gives off the appearance of a pretty strong conflict of interest, and makes people more cynical and less trustworthy of the government that is supposed to represent them.
Of course, much of the real underlying problem here is the state of money in politics today, and the fact that, for most Congressional Reps. fundraising is nearly 50% of their job responsibilities. So, if you're going to Hollywood, why not tack on a fundraiser? But, again, what that does, in the public's eyes, is make the entire process appear corrupt in some fashion. Thus, even if everyone's goals and intentions are aboveboard, the American public has significantly less trust in the entire system.
Last year, when the Sony emails leaked, and it was revealed that the MPAA was still totally focused on bringing SOPA back through alternative means, one of the strategies explored was getting the International Trade Commission (the ITC) to set up a sort of secret SOPA. The ITC is an already problematic government agency that is already widely abused by patent holders. Basically, you can ask the ITC to "block" some sort of "illegal foreign competition." And for patent holders, this has meant going to the ITC and claiming that a foreign firm (or a domestic firm that is importing products) is violating its patents, and thus the ITC should issue an injunction blocking any such products from entering the US at its borders. This is already troublesome in the patent context, because the ITC process is entirely separate from either the USPTO's review of patents or the federal courts -- and actually has different rules. So even if a court might decide that a patent is invalid under existing rules, the ITC may have already started blocking the import of products, claiming patent infringement. It basically allowed patent holders to get two bites at the apple (sometimes, quite literally at Apple).
The MPAA's theory was that if the ITC can block "infringing products" at the border, why can't it basically do the same thing for "infringing content." The goal of the strategy -- which even the MPAA's legal experts admitted was a long shot -- was to find a key case, in which "digital goods" of some sort went before the ITC, and see if it could get a ruling in its favor. It found that case in the ClearCorrect case, in which the company ClearCorrect faced off against the ITC over its 3D printing of clear plastic braces, custom-designed for each patients' teeth. While another company holds patents on a similar process, ClearCorrect tried to get around this by doing the computer work in Pakistan, and then sending the completed digital model back to the US to be printed. Thus, ClearCorrect argued, it was not violating the patents in the US and was just getting a digital file. The ITC ruled against ClearCorrect, and the company appealed the ITC's ruling out into the federal court system where the case was heard by the appeals court for the Federal Circuit (CAFC). The MPAA weighed in supporting the ITC, hoping to give teeth to the idea that the ITC can block "digital goods" at the border for "infringement." Thankfully, the good folks at Public Knowledge weighed in on the other side, noting what a massive and dangerous expansion of power this would be for the ITC in a very digital world.
Thankfully, today, the CAFC sided with ClearCorrect and against the ITC (and the MPAA), noting that the ITC has no jurisdiction to issue injunctions on digital products. The decision was written by CAFC chief judge, Sharon Prost (who has really shaken up CAFC in a good way since taking over last year). Prost correctly notes that the ITC's original decision was a massive, unauthorized expansion of the ITC's jurisdiction, without the necessary Congressional approval. In short:
The Commission’s decision to expand the scope of its
jurisdiction to include electronic transmissions of digital
data runs counter to the “unambiguously expressed intent
Prost notes that the ITC's charter allows it to issue injunctions to block the import of "articles" at the border, and "it is clear that 'articles' means 'material things,' whether when looking to the literal text or when read in context 'with a view to the term's place in the overall statutory scheme.'"
The judge notes that, while digital content has some sort of physical aspects, that does not make it the same thing as physical property:
We recognize, of course, that electronic transmissions
have some physical properties—for example an electron’s
invariant mass is a known quantity—but commonsense
dictates that there is a fundamental difference between
electronic transmissions and “material things.”
Going into more detail, Prost basically just reads the law:
The Commission’s jurisdiction to remedy unfair international
trade practices is limited to “unfair acts” involving
the importation of “articles.” 19 U.S.C. § 1337(a).
Thus, when there is no importation of “articles” there can
be no unfair act, and there is nothing for the Commission
to remedy. Here, the only purported “article” found to
have been imported was digital data that was transferred
electronically, i.e., not digital data on a physical medium
such as a compact disk or thumb drive. The Commission’s
April 3, 2014, majority opinion devotes twenty-one pages
of analysis to the question of whether “articles” encompasses
digital data and ultimately concludes that it does.
But Judge Prost notes that the ITC is just wrong about that. And then starts digging in deeper and deeper about how ridiculous the ITC was in trying to make this massive landgrab. She spends pages citing the dictionary (actually, multiple dictionaries) as to why the ITC is just wrong. And then moves on to point out that it's pretty clear what Congress meant and the ITC seems to have just decided for itself to try to expand its powers. It's a pretty thorough smackdown. After making it clear that the ITC clearly misread the statute, Prost then goes on (even though she doesn't have to) to smack down the ITC's interpretation as "unreasonable." Again, she returns to the dictionary and notes that it appears the ITC looked at it, and then decided to pretend it said something different.
The Commission’s analysis of dictionary definitions
evidences the irrationality of the Commission’s interpretation
of the term “article.” While the Commission ostensibly
analyzes various dictionary definitions, it fails to
adopt a definition consistent with any of the definitions it
references. For example, as discussed in the prior section,
the Commission turns to the 1924 edition of the Webster’s
dictionary for the definition of “article,” but rather than
adopt that definition it concludes that it will “embrace a
broader meaning that describes something that is traded
in commerce.” ... In other words,
it generates its own definition, unrelated to the definition
provided by the dictionary.
Furthermore, the Commission inexplicably cites to
several dictionaries in two footnotes that support “articles”
being defined as “material things,” but provides no
analysis as to why these dictionaries should not be considered.
Even worse, she notes that the ITC not only misread the legislative history on the Tariff Act, but appears to have simply cut out a key phrase that undermines its argument. Specifically:
The Commission’s Opinion cites the Senate
Report, S. Rep. 67-595, as authority for this conclusion
and then quotes it as follows:
The provision relating to unfair methods of competition
is broad enough to prevent every type and
form of unfair practice and is, therefore, a more
adequate protection to American industry than
any antidumping statute the country ever had.
However, the actual quote reads as follows:
The provision relating to unfair methods of competition
in the importation of goods is broad
enough to prevent every type and form of unfair
practice and is, therefore, a more adequate protection
to American industry than any antidumping
statute the country ever had.
.... The Commission’s
omission of the phrase, “in the importation of
goods” is highly misleading; not only was a key portion of
the quote omitted, but it was omitted without any indication
that there had been a deletion. Furthermore, while
we may agree that the quote, as incorrectly stated by the
Commission, would indicate a broad authority for the
Commission, the phrase “in the importation of goods”
clearly limits the Commission’s authority. And as we
discussed above, it limits it in such a way as to exclude
non-material things. Because the Commission uses this
misquote as its main evidence that the purpose of the act
was to cover all trade, independent of what form it takes,
the Commission’s conclusion regarding the purpose of the
Act is unreasonable.
Yeah, simply deleting the phrase that undermines your argument, without even putting in some "..." or something is pretty bad.
There's a concurring opinion from Judge Kathleen O'Malley that is also a good read, noting how ridiculous it is that the ITC magically thinks it has the right to regulate pretty much the entire internet, without any actual expertise or mandate from Congress:
The Commission has concluded that it has jurisdiction
over all incoming international Internet data transmissions.
It reaches this conclusion despite never having
purported to regulate Internet transmissions in the past,
despite no reference to data transmissions in the statute
under which it acts, despite an absence of expertise in
dealing with such transmissions, and despite the many
competing policy concerns implicated in any attempt to
regulate Internet transmissions. The Internet is “arguably
the most important innovation in communications in a
generation.”... If Congress intended for the Commission
to regulate one of the most important aspects of modernday
life, Congress surely would have said so expressly.....
Although the Commission’s jurisdiction over imported
physical goods is undeniable, it is very unlikely that
Congress would have delegated the regulation of the
Internet to the Commission, which has no expertise in
developing nuanced rules to ensure the Internet remains
an open platform for all.... Instead, the responsibility lies with Congress to decide
how best to address these new developments in technology.....
Indeed, Congress has enacted laws and debated bills
whose intent is to balance an interest in open access to
the Internet and the need to regulate potential abusers.... Not once in
these debates has Congress said or implied that it need
not concern itself with these issues because it had already
delegated the authority to do so to the Commission.
Good stuff. O'Malley is actually arguing that the majority decision doesn't even need to go through the whole "Chevron" test it does, about interpreting the law because it's so blatantly obvious that the ITC has no authority here, but if it must go through with that interpretation test, then she agrees with Judge Prost that the ITC is just wrong.
There is a dissent, from Judge Pauline Newman who basically says "well, the ITC regulates international commerce, and commerce today is digital, so it's all good."
The purpose of Section 337 to provide a facilitated
remedy against infringing imports is beyond dispute. The
panel majority’s removal of this remedy from a preeminent
form of today’s technology is a dramatic withdrawal
of existing rights, devoid of statutory support and
of far-reaching impact. The majority’s ruling, that digital
goods cannot be excluded under Section 337 because
digital goods are “intangible,” is incorrect.
Given all that, don't be surprised to see an attempt to appeal this to the Supreme Court (or en banc for CAFC). But, at least for now this is a good and important decision that wipes out one of the MPAA's secret plans to bring SOPA in through the back door. Kudos to Public Knowledge for focusing in on this case and making the case for keeping the internet open.
The MPAA gleefully announced on Tuesday that it had shut down the main fork of Popcorn Time along with torrent site YTS (and its associated release group YIFY). Of course, if we go back through the history of file sharing, we can find plenty of times when the MPAA similarly declared victory over the shutdown of other file sharing sites -- and not a single one did a damn thing to slow down piracy rates. People just move on to something else. And yet, the MPAA thinks that it did something important here:
“This coordinated legal action is part of a larger comprehensive approach being taken by the MPAA and its international affiliates to combat content theft,” said Chris Dodd, chairman and chief executive of the MPAA, in a statement.
Dodd also says, "By shutting down these illegal commercial enterprises, which operate on a massive global scale, we are protecting not only our members’ creative work and the hundreds of innovative, legal digital distribution platforms, but also the millions of people whose jobs depend on a vibrant motion picture and television industry.”
Dodd is wrong. He's not protecting anything, other than perhaps his own job. Shutting down these sites doesn't decrease infringement -- the infringement just moves elsewhere. It's a giant game of whac-a-mole that the MPAA (and RIAA) have been playing for over a decade, and never seeing any kind of different result.
We highlighted this just last month with our Carrot or Stick research report, which made it clear that these enforcement efforts don't do a damn thing to slow down piracy, and don't do anything to help content creators or the wider creative ecosystem to get paid. You know what does do that? Allowing more innovation to flow. Popcorn Time was popular not just because it was "free" but because the interface and usability were incredible. The MPAA should be learning from that, in understanding how to help offer better products rather than celebrating shutting it down.
Again and again we've seen that when people are presented with good, convenient and reasonably priced options, they massively decrease their infringing activities. But the MPAA has actually made that difficult by burdening most services with ridiculous requirements (like forcing people to watch a movie within 24 hours, or limiting things so that the market becomes fragmented and people can't find the content they actually want to see). If the MPAA were truly concerned with making sure that revenue was supporting the creative ecosystem it would be looking at what Popcorn Time did right, and creating a legal service based on it. Cheering on the fact that you whac'd another mole, while everyone's already moved on to something else is hardly something worth celebrating.
[I]n addition to carrying out background screening on all employees and third party contractors, the MPAA demands that all workers sign annual confidentiality agreements that forbid them from talking about protected content.
With an eye on local law, companies must also implement random searches of their workers for traces of MPAA content, including the removal of coats, hats and belts, the emptying of pockets, a full security pat-down, scanning with metal detectors and inspection of electronic devices.
Other obvious demands are included, all aimed at preventing the leak or physical theft of studio goods: no portable devices with storage capabilities, no baggy clothes, and employees' meals must be brought to work in transparent bags.
Interestingly, the MPAA's 2015 agreement with Amazon actually scales back some of its requirements. Demands that Amazon create an MPAA-specific security team and allow reps monthly access to inspect restricted areas are no longer in force. Other stipulations focused on the specific parameters of on-site, physical security have been loosened or removed completely, as well as specifications for CCTV footage storage, access and retention. The requirement that all involved third parties be CTPAT-certified (Customs Trade Partnership Against Terrorism) has also been dropped, suggesting the MPAA is about done humoring the DHS's paranoiac assertions that everything has a potential terrorism nexus.
But the adjustments made between the 2013 and 2015 edition of the MPAA's "rules" don't reflect a change in the MPAA's Ft. Knox mindset. Instead, it shows the MPAA shifting its priorities from physical protection to digital protection. The high-profile hacking of Sony likely contributed to new stipulations like these:
2015 MPAA added the requirements to perform quarterly vuln scans of external IP ranges, secure any point to point connections by using dedicated, private connections and by using encryption. Additionally the requirement to implement baseline security requirements for WAN network infrastructure devices and services.
2015 MPAA added controls around the encryption of content at rest and in motion. Additionally, procedures around the storage of public and private keys.
Also new to this ruleset is a whole section dedicated to "mobile security" that addresses the potential security holes created by a BYOD environment.
The documents show the MPAA can be forward-thinking when it comes to the distribution of content -- especially when trying to figure out how to stop it.
We've been discussing the concept of "fair use" and how ridiculous it is that the USTR seems to be ignoring it. Back in 2012 there was great fanfare out of the USTR, when they said, for the very first time, they'd be including "limitations and exceptions" in the TPP proposal. "Limitations and exceptions" being a misleading euphemism for fair use (and some other related concepts all focused on the public's rights). However, as we noted soon after, the leaked text showed that while it was true that this would be the first such agreement that included such a concept, it only did so by limiting the ability of countries to implement a full fair use regime.
Then, with the latest leak of the negotiating text (from right before the most recent round of negotiations) we noticed how ridiculous it was that the fair use section was voluntary while all the sections on copyright enforcement were mandatory. Specifically all the enforcement sections said that countries "shall" implement this or that. But when it came to "limitations and exceptions" it just said that countries "shall endeavour to achieve appropriate balance." In other words: you have to ratchet up copyright law, but with fair use, you know, maybe think about it and try your best.
As of last month, it seemed that all of the TPP countries had agreed to this language. In late July, however, tech companies' renewed pressure seemed to have changed the game. The USTR offered to go back in and revise these provisions ahead of the last negotiation round. According to a spokesperson for the U.S. Chamber of Commerce, in exchange for support for the controversial Fast Track legislation, the USTR promised to make the TPP's exceptions and limitations language more permissive and be a requirement, rather than being purely a suggestion, for all TPP countries.
And... guess who went ballistic? Yup. Hollywood.
According to Inside U.S. Trade, rightsholder groups like the Motion Picture Association of America (MPAA) are "livid" about the USTR's move to revisit the language on exceptions and limitations. They're pushing back hard, urging members of Congress—including every House member from California—to pressure the USTR not to touch these closed provisions. Why? Probably not because revisiting the language will actually cause any real harm to creators. The more likely explanation is that the copyright maximalists are worried that their tight grip over the USTR is slipping.
This isn't all that surprising. Remember, as part of the Sony email leak, one of the emails showed MPAA boss Chris Dodd freaking out about the possibility that the TPP might include some sort of fair use. From the letter Dodd sent to USTR Michael Froman::
I am writing to you today regarding your Wednesday remarks at the Center for American Progress. I am concerned about your suggestion that previous free trade agreements’ copyright provisions were unbalanced and that USTR has addressed this lack of balance by including “fair use” in the TPP. Quite to the contrary, the recently ratified US-Korea FTA was supported by a broad cross-section of US industry, from tech and the internet community to the copyright community, and furthermore has been held up as a model agreement.
As I know you are aware, the inclusion of “fair use” in free trade agreements is extremely controversial and divisive. The creative community has been, and remains, a strong and consistent supporter of free trade, but the potential export of fair use via these agreements raises serious concerns within the community I represent. Over the last 24 hours, I have received calls from my member companies questioning what they perceive as a significant shift in US trade policy and, as a consequence, the value of the TPP to their industry.
Amusingly, this is the same MPAA who ridiculously claims to love fair use. As Sutton notes, this reaction is almost certainly fear over losing lobbying control over the USTR -- a main channel through which it has pushed its agenda for the past few decades.
But there is another important point in Sutton's post: why should it require Google and other internet companies to step up before the USTR took this issue seriously? Plenty of us out here in the public have been arguing about this issue for years -- including in letters sent directly to the USTR. But we're totally ignored until "big industry" comes along and says the same thing. That's really messed up.
The big media lobbyists' theatrics over this minor amendment are embarrassing, but they do raise one important issue: our trade negotiators are a lot less interested in the needs of ordinary users and creators than the needs of powerful companies. Why else was a last-minute intervention by Google sufficient to bring the USTR back to the negotiating table on this topic, where the sustained interventions of EFF and 10 other major public interest groups from around the world were not?
These kinds of regulatory laundering efforts shouldn't be at the whims of big companies, whether or not you agree with the policies being pushed. I'm just as uncomfortable with internet companies pushing the agenda as I am with Hollywood companies doing so. This entire process has been a ridiculous lesson in corporate give aways with little interest for the public. The only thing "transparent" here is how the USTR is focused solely on the desires of big companies, with absolutely no concern for the public interest. That seems like a fairly big problem, especially considering that Congress basically abdicated its (Constitutionally-guaranteed) role to step in and block bad provisions of these agreements.
The MPAA has been working on a number of tricks to find a SOPA through the backdoor in the last few months -- more on some of the many attempts coming soon -- but in one attempt, it's suddenly walking away. A few weeks ago, all of the major movie studios filed a lawsuit over the website MovieTube (actually a series of websites). While it may well be that MovieTube was involved in copyright infringement (and thus a lawsuit may be perfectly appropriate), the concerning part was that, as a part of the lawsuit, the studios were demanding a remedy that is not available by law: that anyone who provides any kind of service to MovieTube be forced to stop via a court injunction. This was the kind of tool that was a part of SOPA, which (you may recall) never became law. Among the requests in the lawsuit:
That the Registries and/or Registrars be required to transfer the domain names
associated with Defendants’ MovieTube Websites, or any subset of these domain names
specified by Plaintiffs, to a registrar to be appointed by Plaintiffs to re-register the domain names
in respective Plaintiffs’ names and under Plaintiffs’ respective ownership.
That content delivery networks and domain name server systems be required to
cease providing services to the MovieTube Websites and/or domains identified with the
MovieTube Websites and disable any access to caches they maintain for the MovieTube
Websites and destroy any caches they maintain for the MovieTube Websites.
That third parties providing services used in connection with any of the
MovieTube Websites and/or domain names for MovieTube Websites, including without
limitation, web hosting providers, cloud services providers, digital advertising service providers,
search-based online advertising services (such as through paid inclusion, paid search results,
sponsored search results, sponsored links, and Internet keyword advertising), domain name
registration privacy protection services, providers of social media services (e.g., Facebook and
Twitter), and user generated and online content services (e.g., YouTube, Flickr and Tumblr) be
required to cease or disable providing such services to (i) Defendants in relation to Infringing
Copies or infringement of Plaintiffs’ Marks; and/or (ii) any and all of the MovieTube
A few days later, the good folks at EFF reminded everyone that SOPA did not pass, and this attempt to require a SOPA-level block is not actually what the law allows. Of course, as we noted soon after the SOPA fight, it appeared that some courts were pretending SOPA did pass, mainly in a variety of lawsuits involving counterfeit goods (rather than copyright infringement). And the movie studios rely on that in their more detailed argument in favor of this broad censorship order on third parties who aren't even a part of this case:
Courts have granted similar interim relief directed to third-party service providers in
cases with similar facts. The first such case, The North Face Apparel Corp. v. Fujian Sharing
Import & Export Ltd. (“Fujian ”), 10-Civ-1630 (AKH) (S.D.N.Y.), was brought against
defendants in China selling counterfeit goods through the Internet directly to consumers in the
United States. In Fujian, the district court granted an ex parte temporary restraining order,
seizure order, asset restraining order, and domain-name transfer order, later continued by a
preliminary injunction order.
Of course, last week, a bunch of internet companies -- Google, Facebook, Tumblr, Twitter and Yahoo -- filed an amicus brief highlighting how ridiculous the widespread demand is:
Plaintiffs are asking the Court to grant a preliminary injunction not just against
the named Defendants, but also against a wide array of online service providers—from
search engines, to web hosts, to social networking services—and require them to “cease
providing services to the MovieTube Websites and Defendants[.]” None of those
providers is a party to this case, and Plaintiffs make no claim that any of them have
violated the law or play any direct role in the Defendants’ allegedly infringing activities.
Plaintiffs’ effort to bind the entire Internet to a sweeping preliminary injunction
is impermissible. It violates basic principles of due process and oversteps the bounds of
Federal Rule of Civil Procedure 65, which restricts injunctions to parties, their agents,
and those who actively participate in a party’s violations. The proposed order also
ignores the Digital Millennium Copyright Act (“DMCA”), which specifically limits the
injunctive relief that can be imposed on online service providers in copyright cases.
Even if Plaintiffs had named those providers as defendants and obtained a final
judgment against them, the DMCA would not permit the relief that Plaintiffs are asking
for at the outset of their case, where they have not even tried to claim that these
nonparties have acted unlawfully.
We represent Plaintiffs in the above-titled action. We write to inform the Court that after
Plaintiffs filed their Complaint (and presumably in response thereto), Defendants shut down their
infringing websites, and as of today, such websites remain offline. Plaintiffs are no longer
seeking preliminary injunctive relief at this time but will seek permanent relief as soon as
possible. Defendants’ time to answer or otherwise respond is August 19, 2015.
Moreover, because Plaintiffs have withdrawn their motion for preliminary injunctive
relief, the arguments offered by Amici Curiae... in opposition to that motion are
not ripe for consideration and are otherwise inapplicable. Accordingly, Plaintiffs have not
addressed them here. To the extent Amici are requesting what amounts to an advisory opinion,
such a request is improper and should not be entertained.
In short: we had hoped to quietly get a court to pretend SOPA existed so we could point to it as proof that this is perfectly reasonable... but the internet folks spotted it, so we'll just walk away quietly, and hope that next time, those darn internet companies, and those eagle-eyed lawyers at the EFF aren't so quick to spot our plan.
You had to know this was going to happen. Now that the US Trade Rep (USTR) has fast track authority after Congress caved in and passed the Trade Promotion Authority bill, efforts have ramped up to complete the Trans Pacific Partnership Agreement with meetings in Hawaii this week. Of course, with fast track in hand, the USTR doesn't need to concern itself at all with things like the "public interest" anymore and can focus on the real agenda: big corporate interests. Reports from the negotiations include one from the legal policy adviser from Doctors Without Borders, noting that the USTR organized a briefing for "US stakeholders," but only invited industry representatives. Oh, and the US Chamber of Commerce (the main lobbyists for SOPA) was allowed to book a room next to the negotiating room and got a private briefing from the USTR. Meanwhile, James Love from KEI notes that in a USTR briefing, USTR staffers are deliberately ignoring anyone representing the public interest.
You know who they are listening to, however? You guessed it: Hollywood. Politico notes that now that fast track is in hand and the USTR has more or less free rein in completing the negotiations, Hollywood has jumped in with a bunch of demands to expand copyright laws via TPP:
We've seen the Hollywood versus tech copyright fight play out over everything from SOPA to the Library of Congress. Now the major movie studios are pushing for key items on their wish list as negotiators hammer out the final details of an Asia-Pacific trade agreement. The studios hope the 12 countries working on the pact will agree to copyright protections that, in many cases, last longer than what’s currently in place, Pro Trade’s Doug Palmer reports.
The movie studios also want stricter penalties on piracy, especially as Internet access expands throughout the region.
And, because the USTR almost always gives in to Hollywood (it helps that the MPAA hired the top USTR negotiator on IP last year, so the current negotiators recognize that their next jobs are on the line with this agreement), it appears that the US has convinced a bunch of other countries -- who should know better -- to agree to lock in a life + 70-year copyright term, even as the US Copyright Office has suggested that current copyright terms are too long and should be scaled back.
There is no way to explain this as anything but selling out the public interest to appease corporate interests of Hollywood. It's a fairly disgusting display of the kind of "dealmaking" that the USTR has been pushing for more quietly for years, but now that it has fast track, it knows it can play hardball to help its friends in Hollywood. Fuck the public domain, Hollywood wants to keep getting paid for works from decades ago.
If you talk to the reporters who work for various big media companies, they insist that they have true editorial independence from the business side of their companies. They insist that the news coverage isn't designed to reflect the business interests of their owners. Of course, most people have always suspected this was bullshit -- and you could see evidence of this in things like the fact that the big TV networks refused to cover the SOPA protests. But -- until now -- there's never necessarily been a smoking gun with evidence of how such business interests influences the editorial side.
Earlier this month, we noted that the Hollywood studios were all resisting subpoenas from Google concerning their super cozy relationship with Mississippi Attorney General Jim Hood, whose highly questionable "investigation" of Google appeared to actually be run by the MPAA and the studios themselves. The entire "investigation" seemed to clearly be an attempt to mislead the public into believing that it was somehow illegal for Google's search engine to find stuff that people didn't like online. A court has already ruled that Hood pretty clearly acted in bad faith to deprive Google of its First Amendment rights. As the case has continued, Google has sought much more detail on just how much of the investigation was run by the MPAA and the studios -- and Hollywood has vigorously resisted, claiming that they really had nothing to do with all of this, which was a laughable assertion.
However, in a filing on Thursday, Google revealed one of the few emails that they have been able to get access to so far, and it's stunning. It's an email between the MPAA and two of Jim Hood's top lawyers in the Mississippi AG's office, discussing the big plan to "hurt" Google. Beyond influencing other Attorneys General (using misleading fake "setups" of searches for "bad" material) and paying for fake anti-Google research, the lawyers from Hood's office flat out admit that they're expecting the MPAA and the major studios to have its media arms run a coordinated propaganda campaign of bogus anti-Google stories:
Media: We want to make sure that the media is at the NAAG meeting. We propose working with MPAA (Vans), Comcast, and NewsCorp (Bill Guidera) to see about working with a PR firm to create an attack on Google (and others who are resisting AG efforts to address online piracy). This PR firm can be funded through a nonprofit dedicated to IP issues. The "live buys" should be available for the media to see, followed by a segment the next day on the Today Show (David green can help with this). After the Today Show segment, you want to have a large investor of Google (George can help us determine that) come forward and say that Google needs to change its behavior/demand reform. Next, you want NewsCorp to develop and place an editorial in the WSJ emphasizing that Google's stock will lose value in the face of a sustained attack by AGs and noting some of the possible causes of action we have developed.
In other words, Jim Hood and the MPAA were out and out planning a coordinated media attack on Google using the editorial properties that supposedly claim to have editorial independence from the business side. Notice that with the WSJ piece, they flat out admit that the editorial will be based on the ideas that "we" have developed. If you work for the WSJ, your editorial independence just got shot down. Remember when CBS stepped in and interfered editorially with CNET for giving an award to Dish at the same time that CBS was in a legal fight over that same device? That resulted in reporters quitting.
This is worse.
This is an out and out case where the MPAA is admitting to a plan whereby it will use mainstream media properties to run bogus and misleading stories to "attack" Google, to further the MPAA's (believed, but misleadingly so) business interests. Is this really how the Today Show and the WSJ pick their editorial topics?
The "plan" goes even further after that, getting the MPAA to find (and almost certainly pay for) a lawyer to work with the "shareholder" previously identified to file legal filings against Google.
Following the media blitz, you want Bill Guidera and Rick Smotkin to work with the PR firm to identify a lawyer specializing in SEC matters to work with a stockholder. This lawyer should be able to the [sic] identify the appropriate regulatory filing to be made against Google.
As Google notes in its legal filing about this email, the "plan" states that if this effort fails, then the next step will be to file the subpoena (technically a CID or "civil investigatory demand") on Google, written by the MPAA but signed by Hood. As Google points out, this makes it pretty clear (1) that the MPAA, studios and Hood were working hand in hand in all of this and (2) that the subpoena had no legitimate purpose behind it, but rather was the final step in a coordinated media campaign to pressure Google to change the way its search engine works. It's pretty damning:
The document thus shows that the CID was not the foundation of a legitimate
investigation—rather, it was a “final step” that would be issued only “if necessary” to further
pressure Google to capitulate to the demands of AG Hood and his supporters.
The court has yet to rule on what else Hollywood needs to turn over, but just from what's coming out already, serious questions are being raised (1) about Jim Hood and his office and what they were up to as well as (2) the editorial independence of the media arms of the MPAA studios, including both NBCUniversal ("the Today Show") and NewsCorp. (the Wall Street Journal).
Hollywood's efforts to win political clout have always stretched across the country, from glitzy campaign fundraisers in Beverly Hills to cocktail parties with power brokers in Washington.
Last year, the film industry staked out another zone of influence: U.S. embassies. Its lobbying arm paid to renovate screening rooms in at least four overseas outposts, hoping the new theaters would help ambassadors and their foreign guests "keep U.S. cultural interests top of mind," according to an internal email.
That was the same year that the Motion Picture Association of America, which represents the six biggest studios, reported it was lobbying the State Department on issues including piracy and online content distribution. Hollywood's interests – including its push for tougher copyright rules in the Trans-Pacific Partnership trade pact – often put the industry at odds with Silicon Valley.
The only public indication of the embassy-theater initiative was a February 2015 press release from American officials in Madrid, titled "U.S. Embassy Launches State-of-the-Art Screening Room." It credited "a generous donation" from the MPAA.
Asked about its gifts to the State Department, the lobby group declined to say how many embassies got donations or how much they were worth.
"Because film is a great ambassador for U.S. culture around the world, MPAA assisted with the upgrade of some embassy theater facilities," said spokeswoman Kate Bedingfield. "All gifts complied with the law as well as with State Department ethics guidelines."
Nicole Thompson, a State Department spokeswoman, said at least three embassies besides Madrid received between $20,000 and $50,000 in entertainment upgrades last year – London, Paris and Rome. The revamped screening rooms, she said, aren't intended to entertain U.S. officials, but rather to help them host screenings to promote an American industry and sow goodwill.
Thompson said the donations were proper and that all gifts to the department are reviewed to avoid even the appearance of a conflict of interest. "The department has explicit authorities to accept gifts made for its benefit or for carrying out any of its functions," she said.
The State Department routinely accepts gifts from outside groups, Thompson said. She couldn't provide any other examples of major gifts from groups that simultaneously lobby the agency. Thompson declined to list the items given by the MPAA or their total value, and wouldn't say whether the group had made similar gifts in the past.
There was at least one precedent. A spokesman for Warner Bros. Entertainment said the studio helped pay for the refurbishment of the screening room at the U.S. ambassador's home in Paris in 2011. "This donation was coordinated with the State Department and complied with all appropriate rules and regulations," the spokesman said.
State Department policies posted online specifically permit gifts from individuals, groups or corporations for "embassy refurbishment, " provided that the donors are vetted to ensure there's no conflict or possible "embarrassment or harm" to the agency. The posted policies include no caps on the value of donations, nor any requirements for public disclosure of foreign or American donors. The rules also say that the donations can't come with a promise or expectation of "any advantage or preference from the U.S. Government."
Obtaining an advantage, albeit a nonspecific one, sounded like the goal when a Sony Pictures Entertainment official wrote to the studio's chief executive officer, Michael Lynton, to relay a request to fund the screening rooms from Chris Dodd, the former U.S. senator who heads the MPAA. The executive writing the note – Keith Weaver – sought to assure the CEO that such a donation wouldn't be improper.
"The rationale being that key Ambassadors will keep U.S. cultural interests top of mind, as they screen American movies for high level officials where they are stationed," reads the message, included in a cache of emails hacked from Sony and which were posted online by the website WikiLeaks.
"The cost implication is estimated to be $165k (aggregate of $$$/in-kind) per embassy/per studio. Apparently, donations of this kind are permissible."
Besides Sony, the MPAA represents Disney, Paramount, Twentieth Century Fox, Universal Studios and Warner Bros. Entertainment. The e-mails suggest that Sony executives decided against contributing to the project for budget reasons.
The MPAA has long been a powerful presence in the nation's capital, spending $1.34 million on federal lobbying last year, according to data compiled by the Center for Responsive Politics. One of its flashier tools has been to host exclusive gatherings at its Washington screening room, two blocks from the White House, where lawmakers get to watch blockbuster films, rub elbows with celebrities, and up until several years ago, enjoy dinner – a perk scuttled because of stricter rules on congressional lobbying.
Hollywood studios depend on foreign markets for much of their profit but the MPAA's interests don't always align with those of other major American constituencies. For example, Hollywood studios have moved some film production to Canada to cut costs. American film workers have tried to get the federal government to stop the outsourcing of jobs, but have been met with resistance from the MPAA.
The trade group has also pushed federal officials to pressure foreign governments into adopting stricter copyright laws. An MPAA-funded study found that in 2005 worldwide piracy cost American studios $6.1 billion in revenue. That number has been disputed by digital rights advocates.
For the TPP trade deal, the MPAA has discouraged the American government from exporting "fair use" protections to other countries. In a hacked message from Dodd to the U.S. Trade Representative, the MPAA chief warned that including such provisions, which in American law allow limited use of copyrighted materials without permission, would be "extremely controversial and divisive." Digital rights activists have characterized the efforts as overzealous.
"They're basically encouraging other countries to adopt the most draconian parts of U.S. copyright law and even to reinterpret U.S. copyright law to make it more stringent," said Mitch Stoltz, an attorney for the Electronic Frontier Foundation. "Broadly speaking broadening copyright law harms free speech in many cases by creating a mechanism for censorship."
The state-of-the-art screening rooms are a relatively minimal investment by Hollywood as it works to strengthen connections abroad.
This spring, the U.S. ambassador to Spain, James Costos, brought a group of foreign officials to Los Angeles for a meeting hosted by the MPAA. Among them were representatives from the Canary Islands, who came prepared to discuss filming opportunities and tax incentives for American studios in the Spanish territory. The State Department touted the trip as an opportunity to "expand bilateral trade and investment, including through ties between the entertainment industries."
It's not known whether the path to that particular meeting was eased by the new screening room in Madrid. At the theater's debut in February, the ambassador's guests were treated to a dark tale of corruption, lobbying and double-dealing in Washington – the Netflix series "House of Cards."
We've already covered some of the details coming out in the flurry of legal filings in the dispute between Google and Mississippi Attorney General Jim Hood (helped along by the MPAA which financed and ran Hood's investigation). However, there is one little tidbit mentioned towards the end in one of the MPAA's many filings resisting subpoenas from Google to turn over internal documents. The MPAA's lawyers at Jenner & Block not only argue that much of the material being requested is "privileged," and thus allowing the requests will lead to lawsuits over the legality of those requests, but further argues that the emails in the Sony hack are similarly privileged and should not be available for use in lawsuits:
Quite apart from the policy concerns that arise if lawyers are allowed to use confidential
documents first obtained by hackers, the fact that some privileged documents were published in
the wake of the Sony hack will trigger subsequent litigation over privilege assertions. Privileged
documents obtained by hackers and later published nevertheless remain privileged. Presumably,
given Google’s apparent interest in the documents, Google will contest the privilege assertions.
This seems like a pretty longshot legal argument. It's pretty typical in business settings that once documents are out there in the public, any legal restrictions on them vanish. The idea that these documents, widely discussed publicly and in the press, would magically be banned from use in a legal case that was brought on because of those revelations is a huge stretch.