Cathy Gellis’s Techdirt Profile

cathy

About Cathy Gellis




Posted on Techdirt - 25 June 2018 @ 3:40am

The Supreme Court Makes A Federal Case Out Of South Dakota's Inability To Collect Taxes From Its Residents And Thus A Big Mess

from the aereo-for-ecommerce dept

In some ways the Supreme Court's decision last week in South Dakota v. Wayfair may seem like a small thing: it simply overturned an earlier decision, Quill Corp v. North Dakota, which had concluded that states could not impose requirements to collect sales tax on businesses with no physical presence in the state. But in dispensing with that rule, the decision invited broader effects that may not be so small, thanks to the alarming reasoning the Court used to justify it.

The Court was prompted to reverse its earlier decision – something that the Supreme Court does but rarely, thanks to the principle of stare decisis that ordinarily discourages the Court from messing with an earlier precedent – for a few reasons. In particular it was concerned that Internet businesses without a physical presence in the state had an advantage over those with one [p.12-13], and it accepted South Dakota's claims that it was losing out on millions of dollars in sales tax revenue when South Dakotans bought things from out-of-state Internet businesses who were not collecting the sales taxes that normally would have been owed [p.2].

These assumptions, if true, would raise reasonable policy concerns. But even if they were valid worries, it doesn't follow that the Supreme Court should be the organ of government to address them, especially not when its doing so threatens to create additional policy concerns of its own.

First, South Dakota may be heavily dependent on sales tax to generate revenue, but that's its choice. If consumption taxes turn out to be an inadequate way of filling its coffers, it could choose to impose other forms of taxation, like an income tax, as many other states have. It is not dependent on the United States Supreme Court to help it balance its budget.

Second, like other states, South Dakota requires its residents to independently submit to the state the sales tax that would have been collected, had they bought their goods from an Internet business with a physical presence there. ("If for some reason the sales tax is not remitted by the seller, then instate consumers are separately responsible for paying a use tax at the same rate." [p.2]). The Court may have been correct in observing that enforcing these sorts of payment requirements may be difficult [p.2], but just because it is difficult does not mean that it should fall to the United States Supreme Court to relieve the state of its enforcement burden – especially not an enforcement burden against parties over whom the state already had undisputed jurisdictional reach. This case essentially seems to boil down to South Dakota complaining, "We can't make our residents, who are clearly subject to our laws, pay their taxes, so please make sure that out-of-state residents, who are not clearly subject to our laws, do instead." And the court was amenable to this plea. [p.13]

As for whether the physical presence rule truly gave an advantage to out-of-state businesses, if the state could manage to get its residents to pay the taxes they owe the answer would be no, since any price advantage an out-of-state business could offer would have been negated by the subsequent payment obligation. But the problem with the Supreme Court having now changed the rule is that it's placed its thumb firmly on the other side of the scale and disadvantaged out-of-state businesses in favor of those with a physical presence.

In terms of sales tax collection, in and of itself it's no small task. States rarely have one tax rate applicable to the whole state, or to all types of goods. True, as the Court notes, South Dakota "is one of more than 20 States that have adopted the Streamlined Sales and Use Tax Agreement."

This system standardizes taxes to reduce administrative and compliance costs: It requires a single, state level tax administration, uniform definitions of products and services, simplified tax rate structures, and other uniform rules. It also provides sellers access to sales tax administration software paid for by the State. Sellers who choose to use such software are immune from audit liability. [p.23]

Such an agreement may certainly aid in minimizing compliance costs. So might the reasonably-priced software that the Court glibly assumes may eventually "make it easier for small businesses to cope with these problems." [p.21]. But in the here and now, compliance is still not so simple. This decision will still reach the other 30 states that have not adopted the Streamlined Sales and Use Tax Agreement, and figuring out how to comply will be more feasible for some businesses than others. Larger companies, for instance, will have more resources to manage complex compliance requirements. Companies large enough, or local enough, to have a presence in these states will also be more familiar with the state and its compliance requirements generally, since they will need to comply with the state's other laws as well.

Which leads to a more significant question raised by this decision, whose holding won't be confined to sales tax collection: what about these other state laws? Per the logic of the decision, can states impose other compliance obligations on Internet businesses, in addition to tax collection ones? As we've seen in recent discussions around Section 230, including in the cases involving Airbnb/Homeaway and Armslist, states love to apply local law to the Internet. In fact, even before the Internet states liked to impose local law whenever they could. The "long-arm" reach of states to impose their regulatory power on out-of-state parties has traditionally been limited by the requirement that the foreign party at least have some minimum contact with the state before they can be exposed to its jurisdiction. Which is why the physical presence rule made sense: being physically there suggested there was a significant enough contact between the party being regulated and the state doing the regulating. It also seemed more fair: in-state companies will also likely have in-state employees able to wield political pressure on the state government if the laws it passes to apply to their employers starts threatening their employment. Whereas out-of-state companies have no such political leverage to wield over the regulators they are nonetheless beholden to.

What the Court seems to be saying now is that lesser contact with a state than physical presence may be sufficient to establish minimum contact. In and of itself, such an assertion may not be controversial, and if the decision's rationale had been focused on those indicia it might not be so disquieting. In terms of the South Dakota taxation law itself, the law does incorporate some limitations so that it won't apply to Internet businesses with only incidental connections to South Dakota.

The Act applies only to sellers that, on an annual basis, deliver more than $100,000 of goods or services into the State or engage in 200 or more separate transactions for the delivery of goods or services into the State."[p.3]

But the Court is not specific as to what sort of lesser contact will be sufficient to subject an Internet business to state jurisdiction for taxation or otherwise, and it is going to be really expensive for out-of-state Internet businesses to find out.

Furthermore, the hostility that the Court showed to these out-of-state businesses is worrying. First, it is unjustifiably dismissive to the utility of the physical presence requirement.

The argument, moreover, that the physical presence rule is clear and easy to apply is unsound. Attempts to apply the physical presence rule to online retail sales are proving unworkable. States are already confronting the complexities of defining physical presence in the Cyber Age. For example, Massachusetts proposed a regulation that would have defined physical presence to include making apps available to be downloaded by in-state residents and placing cookies on in-state residents’ web browsers. Ohio recently adopted a similar standard. Some States have enacted so-called “click through” nexus statutes, which define nexus to include out-of-state sellers that contract with in-state residents who refer customers for compensation. Others still, like Colorado, have imposed notice and reporting requirements on out-of-state retailers that fall just short of actually collecting and remitting the tax. Statutes of this sort are likely to embroil courts in technical and arbitrary disputes about what counts as physical presence. [p. 19-20]

Of course, far from impugning the physical presence rule, these examples demonstrate the wisdom of it, because in all the examples described any dispute that might arise would arise because the states are trying to target businesses that aren't actually physically present in their states.

In fact, in general the Court seems to have an uneasy notion of what constitutes physical presence by an Internet business:

For example, a company with a website accessible in South Dakota may be said to have a physical presence in the State via the customers’ computers. A website may leave cookies saved to the customers’ hard drives, or customers may download the company’s app onto their phones. Or a company may lease data storage that is permanently, or even occasionally, located in South Dakota. Cf. United States v. Microsoft Corp., 584 U. S. ___ (2018). [p.15]

The Court also cannot imagine how limiting a company's physical presence might be of value to it:

But the administrative costs of compliance, especially in the modern economy with its Internet technology, are largely unrelated to whether a company happens to have a physical presence in a State. For example, a business with one salesperson in each State must collect sales taxes in every jurisdiction in which goods are delivered; but a business with 500 salespersons in one central location and a website accessible in every State need not collect sales taxes on otherwise identical nationwide sales. [p. 12]

Worse, to the extent that the Court can imagine why a 500-person company might choose not to have boots on the ground in every state where it might happen to have an online customer, it is inexplicably hostile:

In effect, Quill has come to serve as a judicially created tax shelter for businesses that decide to limit their physical presence and still sell their goods and services to a State’s consumers—something that has become easier and more prevalent as technology has advanced. [p. 13]

Later it in the decision the Court further describes Quill as allowing out-of-state companies to aid and abet customers in "evad[ing] a lawful tax that unfairly shifts to those consumers who buy from their competitors with a physical presence that satisfies Quill—even one warehouse or one salesperson—an increased share of the taxes." [p. 17]

What is concerning is that in using these pejorative assessments the Court is essentially declaring, "How dare you do something legal to avoid liability." Which is sadly an admonition we've heard the Court make before in trying to substantiate a questionable holding in another case: Aereo.

As the Court continues, the comparison with Aereo becomes even more apt:

"Distortions caused by the desire of businesses to avoid tax collection mean that the market may currently lack storefronts, distribution points, and employment centers that otherwise would be efficient or desirable." [p. 13]

In other words, the Court has concluded, "Our jurisdictional rule is deterring investment in the state, so therefore it's a bad rule."

This sort of contorted reasoning is exactly what happened in Aereo, where the Court looked at who was making money, unilaterally decided it was the wrong people, and then tied itself in knots to write new law, indifferent to how much settled precedent it displaced or the full extent of its likely effects, in order to justify reallocating the financial gains.

Then, as now, it was a decision predicated on a series of questionable assumptions. We can only hope that this latest result won't be as seriously catastrophic for online innovation as Aereo has been.

49 Comments | Leave a Comment..

Posted on Techdirt - 19 June 2018 @ 11:57am

Think The GDPR Only Regulates Big Internet Companies? The EU Says It Regulates You Too.

from the another-threat-to-democratized-speech dept

People tend to think of the GDPR as regulation companies must comply with. But thanks to a decision by the Court of Appeals for the EU earlier this month, there's particular reason to believe that ordinary Internet users will need to worry about complying with it as well.

In this decision the court found that the administrator of a fan page on Facebook is jointly responsible with Facebook for the processing of its visitors' data. And, as such, the administrator must comply with applicable data processing regulations – which necessarily include the GDPR.

The fan page at issue in this case appears to be run by some sort of enterprise, "Wirtschaftsakademie." But fan pages aren't always run by companies: as the court acknowledges, they are often run by individuals or small groups of individuals. Yet there doesn't appear to be anything in the ruling that would exempt them from its holding. Indeed, the court recognizes that its decision would inherently apply to them:

Fan pages are user accounts that can be set up on Facebook by individuals or businesses. To do so, the author of the fan page, after registering with Facebook, can use the platform designed by Facebook to introduce himself to the users of that social network and to persons visiting the fan page, and to post any kind of communication in the media and opinion market user data a processor of the data for visitors to its page, and thus jointly responsible with Facebook for its handling.

The problem is, compliance with data protection regulations like the GDPR is no simple matter. In fact, as this article suggests, the decision also potentially makes it even more complicated and expensive by expanding the jurisdiction of individual member states' data protection authorities (which was something that EU-wide regulation like the GDPR was actually supposed to minimize).

[Eduardo] Ustaran expressed concern in his 2017 post about the potential for local DPAs’ authority to issue decisions that affect companies located in other areas, in this case, Facebook, whose EU representative is in Ireland. He says that this goes against the letter of GDPR’s one-stop shop goal.

But even without this change to the GDPR's enforcement operation, the burdens of compliance were already a matter of concern. As discussed previously, compliance with the GDPR is difficult and expensive for even well-resourced companies. It's not something that individual Internet users are going to be able to easily manage, and that's a problem, because who would want to set up a Facebook fan page if doing so opened yourself up to such a crippling compliance burden?

Which leads to the essential problem here. Some cheer the GDPR because it puts user privacy front and center as a policy priority. In and of itself, there's nothing wrong with doing so – in fact, it's an idea whose time has come. But it doesn't matter how well-intentioned a law is if instead of merely regulating otherwise lawful activity it ends up suppressing it. And it's especially problematic when that activity is expressive. Even if chilling expression weren't the intent, if that's the effect, then there is something wrong with the regulation.

Furthermore, while it's bad enough if regulation chills the expressive activity of those well-resourced companies better able to navigate complex and costly compliance requirements, it's even worse if it chills the lawful and even desirable expressive activity of ordinary individuals. One of the things an Internet platform like Facebook does, and does well, is encourage the casual expression of ordinary people. If you have things to say, these platforms make it easy to say them to other people without you needing to invest in corporate structure or technical infrastructure before doing so. These are tools that help democratize expression, which ordinarily is something places claiming to value the principles of free expression should want to support. In fact, the more the antipathy against big companies, the more they should want to ensure that independent voices can thrive.

But instead we're seeing how all this regulation targeted at those big companies instead attacks regular people trying to speak online. We've seen the same problem with SESTA/FOSTA too, where individual online speakers suddenly find themselves risking legal liability for how they interact with other speakers online. And now it's happening again in the GDPR context, where the very regulation ostensibly intended to protect people online now threatens to silence them.

20 Comments | Leave a Comment..

Posted on Techdirt - 11 June 2018 @ 3:29pm

More Bad Facts Making More Bad Law, This Time In Wisconsin

from the thy-online-speaker's-keeper dept

A few weeks ago we, and others, filed an amicus brief in support of Airbnb and Homeaway at the Ninth Circuit. The basic point we made there is that Section 230 applies to all sorts of platforms hosting all sorts of user expression, including transactional content offering to rent or sell something, and local jurisdictions don't get to try to impose liability on them anyway just because they don't like the effects of those transactions. It's a point that is often forgotten in Section 230 litigation, and so last week the Copia Institute, joined by EFF, filed an amicus brief at the Wisconsin Supreme Court reminding them of the statute's broad application and why that breadth so important for the preservation of online free speech.

The problem is that in Daniels v. Armslist, the Wisconsin Court of Appeals had ignored twenty-plus years of prior precedent affirming this principle in deciding otherwise. We therefore filed this brief to support Armslist in urging the Wisconsin Supreme Court to review the Court of Appeals decision.

As in so many cases involving Section 230 the case in question followed an awful tragedy: someone barred from owning a gun bought one through the online marketplace run by Armslist and then shot his estranged partner. The partner's estate sued Armslist for negligence in having constructed a site where dangerous people could buy guns. As we acknowledged up front:

Tragic events like the one at the heart of this case often challenge the proper adjudication of litigation brought against Internet platforms. Justice would seem to call for a remedy, and if it appears that some twenty-year old federal statute is all that prevents a worthy plaintiff from obtaining one, it is tempting for courts to ignore it in order to find a way to give them that remedy.

Nonetheless, there was more at stake than just the plaintiff's interest. This case might look like a gun policy case, or a negligence case, but, like with Airbnb/Homeaway, this case was really a speech case, and laws like Section 230 that help protect speech are ignored at our peril because doing so imperils all the important expression they exist to protect.

The reason it was a speech case is that, as in the Airbnb/Homeaway case where someone was using the platform to say, "I have a home to rent," here someone had used the Armslist platform to say, "I have a gun to sell." Because these platforms only facilitate these narrow topics of expression it's easy to lose sight of what's getting expressed and instead focus on the consequences of the expression. But that's the problem with these cases: someone is trying to hold an Internet platform liable for the consequences of what someone said, and that's exactly what Section 230 forbids.

Tempting though it may be to try to find exceptions to that critical statutory protection, it is important to hold the line because Section 230 only works when it can always work. It wouldn't accomplish anything if platforms were only protected from certain forms of liability but still had to monitor all their users' content anyway. Congress recognized that such monitoring would be an impossible task and crippling to platforms' ability to remain available to facilitate users' speech. A major reason Section 230 exists is to protect speech from the corrosive effects these monitoring burdens would have on it. It is also why Section 230 does not let state and local jurisdictions impose their own monitoring burdens through the threat of liability, as the Wisconsin appeals court decision would do.

Thanks to local counsel Kathryn Keppel at Gimbel, Reilly, Guerin & Brown LLP for all her help getting this brief filed.

Read More | 14 Comments | Leave a Comment..

Posted on Techdirt - 4 June 2018 @ 1:34pm

Highlights From Former Rep. Chris Cox's Amicus Brief Explaining The History And Policy Behind Section 230

from the future-reference dept

The Copia Institute was not the only party to file an amicus brief in support of Airbnb and Homeaway's Ninth Circuit appeal of a district court decision denying them Section 230 protection. For instance, a number of Internet platforms, including those like Glassdoor, which hosts specialized user expression, and those like eBay, which hosts transactional user expression, filed one pointing out how a ruling denying Airbnb and Homeaway would effectively deny it to far more platforms hosting far more kinds of user speech than just those platforms behind the instant appeal.

And then there was this brief, submitted on behalf of former Congressman Chris Cox, who, with then-Representative Ron Wyden, had been instrumental in getting Section 230 on the books in the first place. With this brief the Court does not need to guess whether Congress intended for Section 230 to apply to platforms like Airbnb and Homeaway; the statute's author confirms that it did, and why.

In giving insight into the statutory history of Section 230 the brief addresses the two main issues raised by the Airbnb appeal – issues that are continuing to come up over and over again in Section 230-related litigation in state and federal courts all over the country: does Section 230 apply to platforms intermediating transactional user expression, and does Section 230's pre-emption language preclude efforts by state and local authorities to hold these platforms liable for intermediating the consummation of the transactional speech. Cox's brief describes how Congress intended both these questions to be answered in the affirmative and thus may be relevant to these other cases. With that in mind, we are archiving – and summarizing – the brief here.

To illustrate why Section 230 should apply in these situations, first the brief explains the historical context that prompted the statute in the first place:

In 1995, on a flight from California to Washington, DC during a regular session of Congress, Representative Cox read a Wall Street Journal article about a New York Superior Court case that troubled him deeply. The case involved a bulletin board post on the Prodigy web service by an unknown user. The post said disparaging things about an investment bank. The bank filed suit for libel but couldn’t locate the individual who wrote the post. So instead, the bank sought damages from Prodigy, the site that hosted the bulletin board. [page 3]

The Stratton Oakmont v. Prodigy decision alarmed Cox for several reasons. One, it represented a worrying change in judicial attitudes towards third party liability:

Up until then, the courts had not permitted such claims for third party liability. In 1991, a federal district court in New York held that CompuServe was not liable in circumstances like the Prodigy case. The court reasoned that CompuServe “ha[d] no opportunity to review [the] contents” of the publication at issue before it was uploaded “into CompuServe’s computer banks,” and therefore was not subject to publisher liability for the third party content." [page 3-4]

It had also resulted in a damage award of $200 million dollars against Prodigy. [page 4]. Damage awards like these can wipe technologies off the map. If platforms had to fear the crippling effect that even one such award, arising from just one user, could have on their developing online services, it would dissuade them from being platforms at all. As the brief observes:

The accretion of burdens would be especially harmful to smaller websites. Future startups, facing massive exposure to potential liability if they do not monitor user content and take responsibility for third parties’ legal compliance, would encounter significant obstacles to capital formation. Not unreasonably, some might abjure any business model reliant on third-party content. [page 26]

Then there was also a third, related concern: according to the logic of Stratton Oakmont, which had distinguished itself from the earlier Cubby v. Compuserve case, unlike Compuserve, Prodigy had "sought to impose general rules of civility on its message boards and in its forums." [page 4].

The perverse incentive this case established was clear: Internet platforms should avoid even modest efforts to police their sites. [page 4]

The essential math was stark: Congress was worried about what was going on the Internet. It wanted platforms to be an ally in policing it. But without protection for platforms, they wouldn't be. They couldn't be. So Cox joined with Senator Wyden to craft a bill that would trump the Stratton Oakmont holding. The result was the Internet Freedom and Family Empowerment Act, H.R. 1978, 104 Cong. (1995), which, by a 420-4 vote reflecting significant bipartisan support, became an amendment to the Communications Decency Act – Congress's attempt to address the less desirable material on the Internet – which then came into force as part of the Telecommunications Act of 1996. [page 5-6]. The Supreme Court later gutted the indecency provisions of the CDA in Reno v. ACLU, but the parts of the CDA at Section 230 have stood the test of time. [page 6 note 2].

The statutory language provided necessary relief to platforms in two important ways. First, it included a "Good Samaritan" provision, meaning that "[i]f an Internet platform does review some of the content and restricts it because it is obscene or otherwise objectionable, then the platform does not thereby assume a duty to monitor all content." [page 6]. Because keeping platforms from having to monitor was the critical purpose of the statute:

All of the unique benefits the Internet provides are dependent upon platforms being able to facilitate communication among vast numbers of people without being required to review those communications individually. [page 12]

The concerns were practical. As other members of Congress noted at the time, "There is no way that any of that any of those entities, like Prodigy, can take the responsibility [for all of the] information that is going to be coming in to them from all manner of sources.” [page 14]

While the volume of users [back when Section 230 was passed] was only in the millions, not the billions as today, it was evident to almost every user of the Web even then that no group of human beings would ever be able to keep pace with the growth of user-generated content on the Web. For the Internet to function to its potential, Internet platforms could not be expected to monitor content created by website users. [page 2]

Thus Section 230 established a new rule expressly designed to spare platforms from having to attempt this impossible task in order to survive:

The rule established in the bill [...] was crystal clear: the law will recognize that it would be unreasonable to require Internet platforms to monitor content created by website users. Correlatively, the law will impose full responsibility on the website users to comply with all laws, both civil and criminal, in connection with their user-generated content. [But i]t will not shift that responsibility to Internet platforms, because doing so would directly interfere with the essential functioning of the Internet. [page 5]

That concern for the essential functioning of the Internet also explains why Section 230 was not drawn narrowly. If Congress had only been interested in protecting platforms from liability for potentially defamatory speech (as was at issue in the Stratton Oakmont case) it could have written a law that only accomplished that end. But Section 230's language was purposefully more expansive. If it were not more expansive, while platforms would not have to monitor all the content it intermediated for defamation, they would still have to monitor it for everything else, and thus nothing would have been accomplished with this law:

The inevitable consequence of attaching platform liability to user-generated content is to force intermediaries to monitor everything posted on their sites. Congress understood that liability-driven monitoring would slow traffic on the Internet, discourage the development of Internet platforms based on third party content, and chill third-party speech as intermediaries attempt to avoid liability. Congress enacted Section 230 because the requirement to monitor and review user-generated content would degrade the vibrant online forum for speech and for e-commerce that Congress wished to embrace. [page 15]

Which returns to why Section 230 was intended to apply to transactional platforms. Congress didn't want to be selective about which types of platforms could benefit from liability protection. It wanted them all to:

[T]he very purpose of Section 230 was to obliterate any legal distinction between the CompuServe model (which lacked the e-commerce features of Prodigy and the then-emergent AOL) and more dynamically interactive platforms. … Congress intended to “promote the continued development of the Internet and other interactive computer services” and “preserve the vibrant and competitive free market” that the Internet had unleashed. Forcing web sites to a Compuserve or Craigslist model would be the antithesis of the congressional purpose to “encourage open, robust, and creative use of the internet” and the continued “development of e-commerce.” Instead, it will slow commerce on the Internet, increase costs for websites and consumers, and restrict the development of platform marketplaces. This is just what Congress hoped to avoid through Section 230. [page 23-24]

And it wanted them all to be protected everywhere because Congress also recognized that they needed to be protected everywhere in order to be protected at all:

A website […] is immediately and uninterruptedly exposed to billions of Internet users in every U.S. jurisdiction and around the planet. This makes Internet commerce uniquely vulnerable to regulatory burdens in thousands of jurisdictions. So too does the fact that the Internet is utterly indifferent to state borders. These characteristics of the Internet, Congress recognized, would subject this quintessentially interstate commerce to a confusing and burdensome patchwork of regulations by thousands of state, county, and municipal jurisdictions, unless federal policy remedied the situation. [page 27]

Congress anticipated that states and local authorities would be tempted to impose liability on platforms, and in doing so interfere with the operation of the Internet by forcing platforms to monitor after all and thus cripple their operation:

Other state, county, and local governments would no doubt find that fining websites for their users’ infractions is more convenient than fining each individual who violates local laws. Given the unlimited geographic range of the Internet, unbounded by state or local jurisdiction, the aggregate burden on an individual web platform would be multiplied exponentially. While one monitoring requirement in one city may seem a tractable compliance burden, myriad similar-but-not-identical regulations could easily damage or shut down Internet platforms. [page 25]

So, "[t]o ensure the quintessentially interstate commerce of the Internet would be governed by a uniform national policy" of sparing platforms the need to monitor, Congress deliberately foreclosed the ability of state and local authorities to interfere with that policy with Section 230's pre-emption provision. [page 10]. Without this provision, the statute would be useless:

Were every state and municipality free to adopt its own policy concerning when an Internet platform must assume duties in connection with content created by third party users, not only would compliance become oppressive, but the federal policy itself could quickly be undone. [page 13]

This pre-emption did not make the Internet a lawless place, however. Laws governing offline analogs to the services starting to flourish on the web would continue to apply; Section 230 simply prevented platforms from being held derivatively liable for user generated content that violated them. [page 9-10].

Notably, none of what Section 230 proposed was a controversial proposition:

When the bill was debated, no member from either the Republican or Democratic side could be found to speak against it. The debate time was therefore shared between Democratic and Republican supporters of the bill, a highly unusual procedure for significant legislation. [page 11]

It was popular because it advanced Congress's overall policy to foster the most beneficial content online, and the least detrimental.

Section 230 by its terms applies to legal responsibility of any type, whether under civil or criminal state statutes and municipal ordinances. But the fact that the legislation was included in the CDA, concerned with offenses including criminal pornography, is a measure of how serious Congress was about immunizing Internet platforms from state and local laws. Internet platforms were to be spared responsibility for monitoring third-party content even in these egregious cases.

A bipartisan supermajority of Congress did not support this policy because they wished to give online commerce an advantage over offline businesses. Rather, it is the inherent nature of Internet commerce that caused Congress to choose purposefully to make third parties and not Internet platforms responsible for compliance with laws generally applicable to those third parties. Platform liability for user-generated content would rob the technology of its vast interstate and indeed global capability, which Congress decided to “embrace” and “welcome” not only because of its commercial potential but also “the opportunity for education and political discourse that it offers for all of us.” [page 11-12]

As the brief explains elsewhere, Congress's legislative instincts appear to have been born out, and the Internet today is replete with valuable services and expression. [page 7-8]. Obviously not everything the Internet offers is necessarily beneficial, but the challenges the Internet's success pose don't negate the policy balance Congress struck. Section 230 has enabled those successes, and if we want its commercial and educational benefit to continue to accrue, we need to make sure that the statute's critical protection remains available to all who depend on it to realize that potential.

Read More | 48 Comments | Leave a Comment..

Posted on Techdirt - 30 May 2018 @ 11:57am

Wherein Facebook Messes Up Elections By Trying Not To Mess Up Elections

from the early-bird-gets-the-political-ad-buy dept

A few months ago I suggested that calling Facebook a bull in a china shop might not be fair to bulls. I fear the suggestion remains apt, as Facebook throws its considerable weight around in ways that, while potentially well-meaning, leaves all sorts of chaos in its wake. The latest evidence of this tendency relates to its recent announcement of policies designed to limit who can place political ads on Facebook.

The problem is, that's what it's done: limit who can place ads on Facebook. But according to the Verge, all it's done is limit the ability for SOME people to post political ads. As in, only SOME of the candidates in any particular race.

The Verge article notes that the Mississippi primary is set for June 5. But in one particular race for Congress, only the incumbent's authentication paperwork is in order, so only he is able to buy ads. As the day of the election draws near, his challenger finds himself locked out of being able to advertise through the medium.

E. Brian Rose is a Republican candidate for Congress in Mississippi, and is a primary challenger to the incumbent Rep. Steven Palazzo (R-MS). Up until yesterday, Rose said, Facebook had been a critical part of his campaign strategy. He amassed more than 6,000 followers on his official page, using Facebook ads to target voters in hundreds of narrowly defined demographic targets.

Yesterday, Rose’s campaign planned to buy 500 different Facebook ads. The first batch were approved shortly before the new rules took effect. But when Rose went to buy the remainder, he received a message from Facebook saying his ads had not been authorized. Rose filled out the required online forms attesting to his identity. At the end, Facebook said it would send Rose an authorization code in the mail. He was told it would arrive in 12 to 15 days — by which point the election would be over.

It's a fair read of the story that the challenger screwed up: if the incumbent was able to register, then so should have the challenger. But even so, it still looks like Facebook handled the rule change poorly, both in its timing (mid-race in the critical days leading up to an election), and with too drastic a change too dependent on its successful promotion that left too much to chance despite the serious stakes.

Facebook began allowing political advertisers to start the verification process on April 23rd. The company promoted the new process with a blog post and messages inside Facebook directed at administrators of political pages. In May, it also sent emails to page administrators advising them of the changes.

The challenger says he didn't get the notices about the change. It's a contention that seems plausible: even assuming there were no issues with the messages actually being sent out, or ending up caught in a spam filter, they would have arrived in campaign inboxes in the midst of what surely were busy days full of priorities more important than keeping up with Facebook notifications. Even assuming that authentication is the key to addressing political ad-buy abuse, an effective authentication solution should not have risked locking out live candidates in pending elections. The implementation of any solution should produce greater benefit than cost, which does not seem to be the case here. Because while it may be commendable that Facebook is trying to reduce the manipulation by outsiders on America's political campaigns, it accomplishes little if in the process of trying to reduce one candidate's unfair advantage, it ends up creating another. It appears Facebook should have done more to anticipate what might go wrong with its new system before switching over to it, but the lesson here is not just for Facebook but for those fond of pressuring Facebook to do something, anything, to change its existing policies because it turns out that sometimes doing just anything may be worse than doing nothing.

12 Comments | Leave a Comment..

Posted on Techdirt - 25 May 2018 @ 7:39pm

The GDPR: Ghastly, Dumb, Paralyzing Regulation It's Hard To Celebrate

from the if-you-like-privacy-and-the-Internet-demand-better dept

Happy GDPR day! At least if you can manage to be happy about a cumbersome, punitive, unprecedentedly extraterritorial legal regime that hijacks the resources of businesses everywhere without actually delivering privacy protection commensurate with the enormous toll attempts to comply with it extract. It's a regulatory response due significant criticism, including for how it poorly advances the important policy goals purportedly prompting it.

In terms of policy goals, there's no quarrel that user privacy is important. And it's not controversial to say that many providers of digital products and services to date may have been… let's just say, insufficiently attentive to how those products and services handled user privacy. Data-handling is an important design consideration that should always be given serious attention. To the extent the GDPR encourages this sort of "privacy by design," it is something to praise.

But that noble mission is overwhelmed by the rest of the regulatory structure not nearly so adeptly focused on achieving this end, which ultimately impugns the overall effort. Just because a regulatory response may be motivated by a worthwhile policy value, or even incorporate a few constructive requirements, it is not automatically a good regulatory response. Unless the goal is to ruin, rather than regulate, knotty policy problems need nuanced solutions, and when the costs of complying with a regulatory response drown out the intended benefit it can't be considered a good, or even effective, policy response. Here, even if all the GDPR requirements were constructive ones – and while some are, some are quite troubling – as a regulatory regime it's still exceptionally problematic, in particular given the enormous costs of compliance. Instead of encouraging entities to produce more privacy-protective products and services, it's instead diverted their resources, forcing them to spend significant sums of money seeking advice or make their own guesses on how to act based on assumptions that may not be correct. These guesses themselves can be costly if it results in resources being spent needlessly, or for enormous sums to be put in jeopardy if the guesses turn out to be wrong.

The rational panic we see in the flurry of emails we've all been getting, with subject lines of varying degrees of grief, and often with plaintive appeals to re-join previously vibrant subscriber communities now being split apart by regulatory pressure, reveals fundamental defects in the regulation's implementation. As does the blocking of EU users by terrified entities afraid that doing so is the only way to cope with the GDPR's troubling scope.

The GDPR's list of infirmities is long, ranging from its complexity and corresponding ambiguity, to some notably expensive requirements, to the lack of harmonization among crucial aspects of member states' local implementations, to the failure of many of these member states to produce these local regulations at any point usefully in advance of today, and to the GDPR's untested global reach. And they fairly raise the concern that the GDPR is poorly tailored to its overall policy purpose. A sound regulatory structure, especially one trying to advance something as important as user privacy, should not be this hard to comport with, and the consequences for not doing so should not be so dire for the Internet remaining the vibrant tool for community and communication that many people – in Europe and elsewhere – wish it to remain being.

107 Comments | Leave a Comment..

Posted on Techdirt - 23 May 2018 @ 1:45pm

Mugshots.com Operators Arrested For Letting Money Influence Editorial Decisions

from the using-poor-inferences-to-unconstitutionally-prevent-other-poor-inferences dept

Earlier this month Ars Technica reported on the arrest of the alleged operators of Mugshots.com, a website that does what it says on the tin: hosts mugshots. The issue is, the site operators didn't just host mugshots; they also charged people to have their mugshots removed from the site through a companion site, Unpublisharrest.com.

Assuming the arrest warrant is fairly stating things, the site's operators may not have had the best of intentions in running their site the way they did. According to the facts alleged they were more interested in making money by charging people to have their pictures removed from their site than in serving as any sort of public records archive.

But it shouldn't matter why they pursued the editorial policy that they did. First of all, mugshots are generally public records, and for good reason. As South Dakota's attorney general Mark Jackley noted last year, when South Dakota declared them to be public records:

"The release of criminal booking photographs to the public will result in greater transparency in the criminal process, enhance public safety, and will further assist the media and the public in the proper identification of individuals in the criminal process."

People are ordinarily allowed to share public records on their websites, just as they may share any other lawful information. People are also free to be arbitrary and capricious in how they choose what information to share. They are even free to be financially motivated in making those decisions.

But according to authorities in California, if the decision on what information to share is linked to a profit incentive (from the arrest warrant: "The motive behind posting the damaging material is financial gain."), and that information is a mugshot, you go to jail. In the case of the Mugshots.com operators, authorities have predicated their arrest on some alarming statutory language:

As of January 1, 2015, California Civil Code Section 1798.91 .1, Subdivision makes it unlawful for any person engaged in publishing or otherwise disseminating a booking photograph through a print or electronic medium to solicit, require, or accept the payment of a fee or other consideration from a subject individual to remove, correct, modify, or to refrain from publishing or otherwise disseminating that booking photograph. By posting the booking photograph online, and requiring a fee to have it removed, the owners and operators of Mugshots.com and Unpublisharrest.com are operating their websites for an unlawful purpose.

In addition, the authorities construed what the operators of Mugshots.com did as identity theft:

California Penal Code Section 530.5 defines identify theft, stating: "Every person who willfully obtains personal identifying information . . . of another person, and uses that information for any unlawful purpose. . . without the consent of that person, is guilty of a public offense. Section 530.55 identifies a 'person' as a natural person, firm, company, corporation or any other legal entity. The section defines 'personal identifying information' as any 'name, address . . . or other unique physical representation.' Because Mugshots.com and Unpublisharrest.com have used, and continue to use, the booking photographs and PII of individuals for purposes of selling the service of removing the photographs and information, the owners are in violation of California Penal Code Section 530.5, identity theft, a felony."

Taken together, the arrest warrant concludes, the site operators are guilty of extortion and conspiracy to commit extortion. But to prove extortion prosecutors must show that the accused threatened a victim either with violence, the accusation of a crime, or the exposure of a secret, if they didn't pay the accused. Yet the defendants are accused of none of these things. Not only is there no issue of threatened violence, but what the site operators are alleged to have done in no way involves revealing a secret or accusing another of a crime. Instead it is the state that has already accused the site operators' purported "victims" of a crime, and its having done so is no secret. The state's accusation against these people became public when it originally released the mugshots, meaning there is nothing that the site operators could have been threatening to reveal that wasn't already revealed.

This apparently sloppy reading of the extortion statute, compounded with the 2015 statutory language giving mugshots a sort of magical status that prevents them from being treated as an ordinary public record, represents a chilling incursion on protected First Amendment activity. It's one thing to impose liability for publishing content that isn't lawful, perhaps because it's defamatory, infringing, or somehow intrinsically wrongful unto itself. But it's another thing entirely to impose liability for publishing content that is entirely lawful – especially, as in this case, when it is not only lawful but a public record.

California authorities would likely argue that the prosecution is not about liability for speech, but liability arising from the decisions about what speech got spoken. (Or, more particular to this case, remained spoken, for the state is not prosecuting the site operators for having posted the mugshots in the first place.) But this is a distinction without a difference. Indeed, decisions about what we choose to say can be as expressive as anything we actually do say. The government ordinarily does not get to come in and force us to make those decisions in any particular way. Freedom of expression means that we are at liberty to decide what to say, and then what not to say, for whatever reason we might decide. Even when these expressive choices are guided by a profit motive.

Were that not the case, think of how chilling it would be to profit-driven news media if their editorial decisions had to be free from any financial concern in order to retain First Amendment protection. Even in terms of mugshots themselves, think about how chilling it would be if others could not freely use them to tell us about the world around us, if there was money to be made in the process. As case in point, the very same week the arrest warrant was used to extradite the site operators back to California, the New York Times ran a story about the efforts of journalist and photographer Eric Etheridge to document the lives of Freedom Riders.

Among the important artifacts of this historic campaign are more than 300 mug shots taken of the Freedom Riders in Jackson, now the subject of “Breach of Peace: Portraits of the 1961 Mississippi Freedom Riders” (Vanderbilt University Press). In it, the journalist and photographer Eric Etheridge provides visual and oral histories of these courageous men and women, juxtaposing vintage mug shots with short biographies, interviews and contemporary portraits. Originally published in 2008, this expanded edition, with updated profiles and additional portraits…

It is a book that is for sale, so it would seem there is a profit motive somewhere. But consider whether this important historical work could be released if authorities in California – or, perhaps more saliently, in Mississippi, where the mugshots are from – could scrutinize the expressive decisions that went into the book's use of the pictures because it profited from that use.

Yet that's what the California authorities have decided they are entitled to do with the Mugshots.com site. The arrest warrant is dismissive towards the free speech interests of the site's operators, accusing them of "using freedom of speech theories in justifying the activity." Of course, that's what the First Amendment is for, to protect expressive activities that authorities do not like. And authorities really don't like what happened here.

As noted above, the optics in this case are not great. People felt desperate to have their mugshots removed from the Internet, and the site operators profited from that desperation. It feels criminal, but just because they may have had nefarious intent does not mean that they committed a crime. Just reading about the arrest brought to mind the Monty Python sketch where a bunch of gangsters connived a devious plot to go to a jeweler's to obtain an expensive watch - that they paid for.

Sure, it looks like they are up to no good, but to determine whether a crime has been committed we can't just consider how it looks. We have to look closely at the underlying lawfulness of the activity, not the optics surrounding it, and for the very same reason that California authorities are now interested in policing the use of mugshots: to prevent unwarranted inferences of criminal culpability. As the New York Times wrote about the Freedom Riders book:

If these mug shots inadvertently captured the humanity and special qualities of their principled subjects, as Mr. Etheridge observed, their intention was nefarious: to publicly impugn and humiliate people whose only crime was to advocate equality through peaceful protest. No matter their purpose, mug shots inevitably imply aberrance or delinquency, whether or not the people they depict are eventually found to be guilty.

But that's what the California prosecutors have done: impute "aberrance or delinquency" to draw unwarranted inferences about criminal culpability from an act that the law cannot constitutionally criminalize. This inference has already been used to strip the site operators of their constitutional right to express themselves anonymously due to at least three search warrants that were served on their service providers. These warrants were issued upon probable cause, but the only probable cause that can be construed here is that the site operators engaged in expressive activity authorities did not like. Efforts by these authorities to now extradite, further prosecute, and potentially leave the site operators vulnerable to civil damages should not be cheered by anyone who might prefer not to experience the same as a result of their own lawful expression.

Read More | 74 Comments | Leave a Comment..

Posted on Techdirt - 9 May 2018 @ 3:34am

Give Me Liberty, Or Give Me Data Protection? A Troubling Implication Of The American Voter UK Data Protection Case

from the frying-pan-to-fire dept

The Guardian had an article this past weekend about what looks like a potentially successful attempt by an American to use UK data protection law to force Cambridge Analytica to divulge what information it had collected about US voters like him. Whether the UK Information Commissioner’s Office (ICO) is truly entitled to compel Cambridge Analytica to do anything, much less on behalf of an American, is an open question. But for purposes here, let's assume that UK data protection law works this way, that it was intended to work this way, and that it's good policy for it to work this way.

The problem is, it's one thing for the ICO to force Cambridge Analytica to share with the American voter himself what personal data it had about him. But it's another thing entirely for the ICO to force Cambridge Analytica to share the personal data it has about American voters with it. Yet it looks from the article like that's what ICO may have threatened to force Cambridge Analytica to do.

The troubling passage:

The covering letter from the ICO says that if Cambridge Analytica has difficulties complying, it should hand over passwords for the servers seized during its raid on the company’s office – something that raises questions also about what it has managed to retrieve from the servers so far.

Insert record scratch noise here. The framing of the article, and a lot of reaction to it, is that ICO is the white knight here, seeking to vindicate the privacy rights of Americans whose data has been scooped by Cambridge Analytica. Maybe so, but to the extent it proposes to do this by itself scooping up Americans' data (and hopefully future reporting can be more explicit on whether this is what is truly proposed; the Guardian article did not link to the cover letter, nor does the ICO's press announcement) such a move is extremely concerning.

Because regardless of how problematic it is for a private entity like Cambridge Analytica to have access to lots of data about American voters, for all those same reasons it is even more problematic for a government to. And while it would be bad enough if it were the American government demanding it, it's even worse if it's a foreign government that now has access to all this data about American voters.

It's not a question of how much we trust that foreign government. We might see the problem more easily if it were, say, Russian regulators demanding Cambridge Analytica give it all the data it has, but the fact that it is our UK ally demanding it makes no difference. Irrespective of how well-intentioned or trust-worthy one considers the UK government of today, or its data protection authority, we still fought a war or two to keep it out of American democracy. In fact, so unhappy were we about things the UK government had done to help itself to information about American lives that we even came up with a couple of constitutional amendments to ensure the practice would not be continued.

Thus no matter how we feel about Cambridge Analytica having acquired our data without our permission, it would be a strange thing to encourage governments to return to those old ways and get to acquire our data without our permission too. Especially not governments so politically unaccountable to those whose data they would now collect.

Because while voters like Professor Carroll might not care, the apparently indiscriminate way the ICO has acquired data by copying entire servers would seem to capture the data of many more American voters than just him. Which, to put into the language of EU privacy regulators, would constitute a sort of data acquisition that not all of us affected had consented to.

20 Comments | Leave a Comment..

Posted on Techdirt - 4 May 2018 @ 3:41pm

Airbnb, Homeaway, And The Importance Of Holding The Line On Section 230

from the back-to-basics dept

SESTA has done enormous damage to the critical protection Section 230 affords platforms – and by extension all the Internet speech and online services they facilitate. But it's not the only threat: courts can also often mess things up for platforms by failing to recognize situations where Section 230 should apply and instead allowing platforms to be held liable for how their users have used their services.

Which leads to the situation Airbnb, Homeaway, and other such platforms find themselves in. Jurisdictions unhappy with some of the effects short-term rentals have had on their communities have taken to passing regulations designed to curb the practice. Whether or not it is good policy to do so is beyond the scope of this post. If some local jurisdictions want to impose liability on their residents for renting out their homes – and not all of them do – it's between them and their voters.

The problem arises when the regulations they come up with don't just target people renting their homes, but also target the online platforms that facilitate these transactions. These ordinances effectively create liability for platforms arising from content generated by others, which is a regulatory practice that Section 230 prohibits.

So Airbnb and Homeaway have started pushing back on these ordinances, first in San Francisco and now in Santa Monica. Unfortunately both efforts to enjoin them have resulted in federal district court decisions saying that Section 230 does not shield them from their reach, meaning that these local jurisdictions are fully able to hold these platforms liable if people use them to rent homes they aren't supposed to. The decision about the Santa Monica ordinance is now before the Ninth Circuit, and last week I wrote a brief for the Copia Institute explaining why it should find that Section 230 indeed prevents these ordinances from imposing liability on these platforms. It was important to say so, not just to support Airbnb and Homeaway, but because if Section 230 can't apply to them, then it won't be able to apply to a lot of other platforms that depend on it.

The crux of the problem appears to stem from courts not seeing how what is at stake in these cases is actually speech, perhaps because the kind of speech sites like Airbnb and Homeaway intermediate is so specific. But even if the only expression these platforms intermediates is, "I have a home to rent," it's still speech, speech created by someone other than the platform, and Section 230 therefore still applies. There is no language in Section 230 that would require a platform to intermediate lots of different kinds of expression in order to be entitled to the statute's protection. Many platforms are extremely specialized in the type of expression they intermediate, often because that's what makes them useful and effective as services, and all are equally entitled to the statute's protection.

The fact that the specific speech being intermediated is transactional in nature seems to be what's confusing the courts, especially given that these sites often make money by taking a cut of the transactions that are successful. The court addressing the Santa Monica ordinance recognized that a site like Craigslist, which also hosts "I have a home to rent" speech (among other types of speech), would not be affected by the ordinance because it doesn't make money when "I have a home to rent" speech results in a rental. But there is no reason that these platforms should be treated any differently. Section 230 applies regardless of how a platform makes its money. There's no requirement in the statutory language that a platform profit only in certain ways – in fact, if anything the statute encourages platforms to be innovative so that the public can continue to benefit from their services. And for good reason: think about platforms like eBay, which also profit when "I have a thing to sell" speech finds an audience who wants to buy it. If Section 230 protection could be withheld from all platforms that make money from consummated transactions it would be more than just the Airbnb and Homeaway who would be in trouble.

The only relevant question to ask in considering whether Section 230 applies is who created the content that is potentially wrongful. In the case of Airbnb and Homeaway it is their users. After all, there's nothing inherently wrongful about saying, "I have a home to rent." Whether it is wrongful depends entirely on whether the user is allowed to rent it per local law. Liability should therefore remain entirely with the user who is the one who imbued it with its wrongness. Particularly because it is often not practical, or even possible, for platforms to police all the content passing through them. Even if they had the resources to examine the volume of user-generated content that passes through their systems they may not have the ability to know which, if any of it, was wrongful. Thus if platforms could be forced by any particular jurisdiction to try to police it anyway, in order to stave off potentially expensive liability, it would invariably chill their ability to provide their services – including in other jurisdictions.

Which is also why Section 230 includes a pre-emption provision, so that no particular jurisdiction can get to decide for any other one what Internet speech and services people can benefit from in these other places. Without that provision the jurisdiction with the most restrictive laws would otherwise get to impose its policy choices on any other jurisdiction the service now shaped by these policies could reach, which, in the case of an Internet service, is every single one of the thousands and thousands of state and local jurisdictions nationwide.

Read More | 15 Comments | Leave a Comment..

Posted on Techdirt - 30 April 2018 @ 2:12pm

Congress And The CASE Of The Proposed Bill That Helps Copyright Trolls

from the start-of-stopping-trolls dept

One of the recurrent themes on Techdirt is that law itself should not become a tool for unlawful abuse. No matter how well-intentioned, if a law provides bad actors with the ability and opportunity to easily chill others' speech or otherwise lawful activity, then it is not a good law.

The CASE Act is an example of a bad law. On the surface it may seem like a good one: one of the reasons people are able to abuse the legal system to shut down those they want to silence is because getting sucked into a lawsuit, even one you might win, can be so ruinously expensive. The CASE Act is intended to provide a more economical way to resolve certain types of copyright infringement disputes, particularly those involving lower monetary value.

But one of the reasons litigation is expensive is because there are number of checks built into it to make sure that before anyone can be forced to pay damages, or be stopped from saying or doing what they were saying or doing, that the party making this demand is actually entitled to. A big problem with the CASE Act is that in exchange for the cost-savings it may offer, it gives up many of those critical checks.

In recognition of the harm removal of these checks would invite, EFF has authored a letter to the House Judiciary Committee raising the alarm on how the CASE Act would only aggravate, rather than remediate, the significant troll problem.

Per the letter, federal courts have been increasingly "reining in [trolling behavior] by demanding specific and reliable evidence of infringement—more than boilerplate allegations—before issuing subpoenas for the identity of an alleged infringer. Some federal courts have also undertaken reviews of copyright troll plaintiffs’ communications with their targets with an eye to preventing coercion and intimidation. These reforms have reduced the financial incentive for the abusive business model of copyright trolling."

But under the CASE Act, these provisions would not apply. Instead

[L]egally unsophisticated defendants—the kind most often targeted by copyright trolls—are likely to find themselves bound by the judgments of a non-judicial body in faraway Washington, D.C., with few if any avenues for appeal. The statutory damages of up to $30,000 proposed in the CASE Act, while less than the $150,000 maximum in federal court, are still a daunting amount for many people in the U.S., more than high enough to coerce Internet users into paying settlements of $2,000–$8,000. Under the Act, a plaintiff engaged in copyright trolling would not need to show any evidence of actual harm in order to recover statutory damages. And unlike in the federal courts, statutory damages could be awarded under the CASE Act even for copyrights that are not registered with the Copyright Office before the alleged infringement began. This means that copyright trolls will be able to threaten home Internet users with life-altering damages—and profit from those threats—based on works with no commercial or artistic value.

And that's not all:

Another troubling provision of the CASE Act would permit the Copyright Office to dispense with even the minimal procedural protections established in the bill for claims of $5,000 or less. These “smaller claims”—which are still at or above the largest allowed in small claims court in 21 states—could be decided by a single “Claims Officer” in a summary procedure on the slimmest of evidence, yet still produce judgments enforceable in federal court with no meaningful right of appeal.

Also:

[T] he federal courts are extremely cautious when granting default judgments, and regularly set them aside to avoid injustice to unsophisticated defendants. Nothing in the CASE Act requires the Copyright Office to show the same concern for the rights of defendants. At minimum, a requirement that small claims procedures cannot commence unless defendants affirmatively opt in to those procedures would give the Copyright Office an incentive to ensure that defendants’ procedural and substantive rights are upheld. A truly fair process will be attractive to both copyright holders and those accused of infringement.

The CASE Act appears to reflect an idealized view that the only people who sue other people for copyright infringement are those who have valid claims. But that is not the world we live in. Trolls abound, parasites eager to use the threat of litigation as a club to extract money from innocent victims. And the CASE Act, if passed, would give them a bigger weapon.

It also gives would-be censors additional tools to chill their critics through the use of a new subpoena power administered through the Copyright Office, without sufficient due process built into the system to ensure that these subpoenas are not being used as a means of unjustly stripping speakers of their right to anonymous speech.

The CASE Act also gives the Copyright Office the authority to issue subpoenas for information about Internet subscribers. The safeguards for Internet users’ privacy established in the federal courts will not apply. In fact, the bill doesn’t even require that a copyright holder state a plausible claim of copyright infringement before requesting a subpoena—a basic requirement in federal court.

EFF was joined on this letter by many other lawyers (including me) and experts who have worked to defend innocent people from unjust threats of litigation, in the hope that it can help pressure Congress not to give the green light to more of it.

12 Comments | Leave a Comment..

Posted on Techdirt - 23 April 2018 @ 10:39am

We Interrupt The News Again With Hopefully The Last Update From The Monkey Selfie Case

from the with-next-friends-like-these dept

And now for the moment you've all been waiting for: a decision from the Ninth Circuit in the Monkey Selfie case.

Upshot: the case remains dismissed, and the defendants get to recover attorney fees for the appeal. There's also relatively little to say on the copyright front. This case has turned almost entirely into litigation about standing and proven to be a significant wrench in the works for any future litigation anyone, but PETA in particular, might want to bring on behalf of animals.

First, the court skewers PETA over the quality of its "friendship" with Naruto, casting significant side-eye towards PETA's apparent settlement of the lawsuit, which led to its attempt to dismiss the appeal, while at the same time leaving some question as to whether Naruto himself was down with this settlement and plan to dismiss his appeal. From footnote 3:

We feel compelled to note that PETA’s deficiencies in this regard go far beyond its failure to plead a significant relationship with Naruto. Indeed, if any such relationship exists, PETA appears to have failed to live up to the title of “friend.” After seeing the proverbial writing on the wall at oral argument, PETA and Appellees filed a motion asking this court to dismiss Naruto’s appeal and to vacate the district court’s adverse judgment, representing that PETA’s claims against Slater had been settled. It remains unclear what claims PETA purported to be “settling,” since the court was under the impression this lawsuit was about Naruto’s claims, and per PETA’s motion, Naruto was “not a party to the settlement,” nor were Naruto’s claims settled therein. Nevertheless, PETA apparently obtained something fromthe settlement with Slater, although not anything that would necessarily go to Naruto: As “part of the arrangement,” Slater agreed to pay a quarter of his earnings from the monkey selfie book “to charities that protect the habitat of Naruto and other crested macaques in Indonesia.” See Settlement Reached: ‘Monkey Selfie’ Case Broke New GroundForAnimal Rights, PETA, https://www.peta.org/blog/settlementreached-monkey- selfie-case-broke-new-ground-animal-rights/ (last visited Apr. 5, 2018). But now, in the wake of PETA’s proposed dismissal, Naruto is left without an advocate, his supposed “friend” having abandoned Naruto’s substantive claims in what appears to be an effort to prevent the publication of a decision adverse to PETA’s institutional interests. Were he capable of recognizing this abandonment, we wonder whether Naruto might initiate an action for breach of confidential relationship against his (former) next friend, PETA, for its failure to pursue his interests before its own. Puzzlingly, while representing to the world that “animals are not ours to eat, wear, experiment on, use for entertainment, or abuse in any other way,” see PETA, https://peta.org (last visited Apr. 5, 2018), PETA seems to employ Naruto as an unwitting pawn in its ideological goals. Yet this is precisely what is to be avoided by requiring next friends to have a significant relationship with, rather than an institutional interest in, the incompetent party—a point made by ChiefJustice Rehnquist in Lenhard v. Wolff, 443 U.S. 1306, 1312 (1979). See infra page 9 for exact language.

But repudiating PETA's "next friend" standing doesn't end the inquiry. There is a 2004 case from the Ninth Circuit, Cetacean Community v. Bush, which established the precedent that animals might be able to sue for themselves, even without a "next friend" to do the suing for them. The court decides it has to defer to that precedent, although so reluctantly as to undermine its persuasive effect in future cases.

Reaching that conclusion didn't end the inquiry, however. Cetacean Community means that animals might be theoretically able to sue for themselves in the Ninth Circuit, but it doesn't mean they will necessarily have a viable claim. To figure out whether they do, we have to look at the applicable statute, which in this case is the Copyright Act. And here the court concludes that Naruto, being a monkey, has no standing to sue for copyright infringement.

Several provisions of the Copyright Act also persuade us against the conclusion that animals have statutory standing to sue under the Copyright Act. See Davis v. Mich. Dep’t of Treasury, 489 U.S. 803, 809 (1989) (“It is a fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme.”). For example, the “children” of an “author,” “whether legitimate or not,” can inherit certain rights under the Copyright Act. See 17 U.S.C. §§ 101, 201, 203, 304. Also, an author’s “widow or widower owns the author’s entire termination interest unless there are any surviving children or grandchildren of the author, in which case the widow or widower owns one-half of the author’s interest.” Id. § 203(a)(2)(A). The terms “children,” “grandchildren,” “legitimate,” “widow,” and “widower” all imply humanity and necessarily exclude animals that do not marry and do not have heirs entitled to property by law. Based on this court’s decision in Cetacean and the text of the Copyright Act as a whole, the district court did not err in concluding that Naruto—and, more broadly, animals other than humans—lack statutory standing to sue under the Copyright Act.

So there you go. Our long national nightmare of not knowing whether any random monkey might be able to sue for copyright infringement has been resolved. We may now go about our lives confident in the knowledge that they cannot, at least not in the Ninth Circuit.

Read More | 45 Comments | Leave a Comment..

Posted on Techdirt - 17 April 2018 @ 10:38am

If Trump Is So Worried About Protecting Attorney-Client Privilege, He Should End The NSA's Bulk Surveillance (And CPB Device Seizures)

from the Privilege-for-me-not-for-thee dept

Over the weekend Trump tweeted:

If you can't read that it says:

Attorney Client privilege is now a thing of the past. I have many (too many!) lawyers and they are probably wondering when their offices, and even homes, are going to be raided with everything, including their phones and computers, taken. All lawyers are deflated and concerned!

Attorney-client privilege is indeed a serious thing. It is inherently woven into the Sixth Amendment's right to counsel. That right to counsel is a right to effective counsel. Effective counsel depends on candor by the client. That candor in turn depends on clients being confident that their communications seeking counsel will be confidential. If, however, a client has to fear the government obtaining those communications then their ability to speak openly with their lawyer will be chilled. But without that openness, their lawyers will not be able to effectively advocate for them. Thus the Sixth Amendment requires that attorney-client communications – those communications made in the furtherance of seeking legal counsel – be privileged from government (or other third party) view.

The problem is, it doesn't take a raid of a home or office to undermine the privilege. Bulk surveillance invades the sphere of privacy these lawyer-client communications depend on, and, worse, it does so indiscriminately. Whether it involves shunting a copy of all of AT&T's internet traffic to the NSA, or warrantlessly obtaining everyone's Verizon Wireless phone call records, while, sure, it catches records of plenty of communications made to non-lawyers (which itself is plenty troubling), it also inherently catches revealing information about communications made to and from lawyers and their clients. Meanwhile the seizures and searches of communications devices such as cell phones and laptops raises similar Constitutional problems. Doing so gives the government access to all records of all communications stored on these devices, including those privileged ones that should have been expressly kept from it.

So Trump is right: attorney-client privilege in America is under attack, and ever since we started learning about these programs lawyers have definitely been worried about how they impose an intolerable burden on the Sixth Amendment right to counsel. But unlike in Trump's situation where there is serious reason to doubt whether there's any privilege to be maintained at all (after all, privilege only applies to communications made in the course of seeking legal counsel, not communications made for other purposes, including the furtherance of crime or fraud), and care being taken to preserve what privilege there may be, bulk surveillance sweeps up all communications, including all those for which there is no doubt as to their privileged status, and without any sort of care taken to protect these sensitive communications from the prying eyes of the state. Indeed, the whole point of bulk surveillance is so that the prying eyes of the state can get to see who was saying what to whom without any prior reason to target any of these communications in particular, because with bulk surveillance there is no targeting: it swoops up everything, privileged or not.

If Trump truly finds it troubling for the government to be able obtain privileged communications he could put an end to these programs. It would certainly help make any argument he raises about how his own privilege claims should be sacrosanct rings ring less hollow if his administration weren't currently being so destructive to everyone else's.

44 Comments | Leave a Comment..

Posted on Techdirt - 13 April 2018 @ 7:39pm

We Interrupt Today's News With An Update From The Monkey Selfie Case

from the it-ain't-over-till-it's-over dept

In today's fast-paced news cycle it's easy to overlook the important things: the copyright status of the monkey selfie.

Today we have learned nothing new about it, except that the case is not over yet. Which is itself significant, because the parties in the case had jointly moved to dismiss the appeal, and today that motion was denied. In its order denying the motion [pdf, embedded below] the Ninth Circuit acknowledged that while it had the power to dismiss an appeal if the parties so requested it, it did not have the obligation to do so if there were countervailing interests. And in this case, the Ninth Circuit found, there were countervailing interests requiring it to fully adjudicate the matter.

It cited several other cases as analogs. As in Albers v. Eli Lily, "this case has been fully briefed and argued by both sides, and the court has expended considerable resources to come to a resolution. Denying the motion to dismiss ensures that 'the investment of public resources already devoted to this litigation will have some return.'" Furthermore, as was the case in Ford v. Strickland, "a decision in this developing area of the law would help guide the lower courts."

Also, referencing Albers and Khouzam v. Ashcroft, the court noted that denying the dismissal of appeals prevents the parties from "manipulating precedent in a way that suits their institutional preferences."

As one of our colleagues once warned in a similar context, “courts must be particularly wary of abetting ‘strategic behavior’ on the part of institutional litigants whose continuing interest in the development in the law may transcend their immediate interest in the outcome of a particular case.” Suntharalinkam v. Keisler, 506 F.3d 822, 828 (9th Cir. 2007) (en banc) (Kozinski, J., dissenting from the denial of rehearing).

In other words, enough of this procedural monkey business. The appeal remains a live matter, and at some point the court will presumably substantively rule on it.

Read More | 33 Comments | Leave a Comment..

Posted on Techdirt - 4 April 2018 @ 10:43am

Yet Another Case Highlights Yet Another Constitutional Infirmity With The DMCA

from the saying-yes-to-censorship-and-no-to-states'-rights dept

Once again, the Constitutional exceptionalism of the DMCA has reared its ugly head. Thanks to the way it has been interpreted we have already enabled it to become an unchecked system of prior restraint, which is anathema to the First Amendment. And now yet another court has allowed this federal law to supersede states' ability to right the wrongs that misuse of the DMCA's censorship tools inevitably causes, even though doing so arguably gives this federal law more power than the Constitution allows.

The two problems are of course related. Prior restraint is what happens when speech is censored without ever having being adjudicated to be wrongful. That's what a takedown demand system does: force the removal of speech first, and sort out whether that was the right result later. But because the Ninth Circuit has taken the teeth out of the part of the DMCA that is supposed to punish bogus takedowns, that second part very rarely happens. Section 512(f) was supposed to provide a remedy for those who have been harmed by their content being removed. But in the wake of key rulings, most recently Lenz v. Universal, that remedy is rarely available, leaving online speakers everywhere vulnerable to the censoring whims of anyone inclined to send a takedown demand targeting their speech, no matter how unjustifiably, since there is little ability to ever hold this wrongdoer liable for the harm their censorship causes.

And censorship does cause harm. Sometimes the harm that it causes can even be to one's business or livelihood, which can suffer from the interruption of the removed content's availability. Of course, normally when people have had their business or livelihoods messed with, they can sue whomever messed with them. We have lots of laws that address wrongful meddling, including torts like intentional interference with contract or prospective economic advantage, because normally we don't like people having free reign to mess with other people's business.

But most of those tort claims are creatures of state law, and the DMCA is federal law. And the question that was raised by a recent case, Stevens v. Vodka & Milk, LLC, is how state law and federal law interrelate. Per the court: they don't. According to the Southern District of New York court, federal law completely pre-empts state law, leaving the only recourse available for someone who has been hurt by wrongful DMCA takedown notices Section 512(f), the remedy that the DMCA ostensibly enables. Even though that remedy is utterly useless.

Sadly, this court was not the first to reach this conclusion. But that fact does not make the conclusion any less terrible, or any less questionable. It's predicated on the notion of "field pre-emption," "where Congress occupies an entire field." In this case, Congress is the exclusive authority establishing copyright, and so federal law pre-empts state laws on copyright. This pre-emption makes sense, because state law addressing copyright would likely interfere with the federal policy. Yet that's not what these state laws are doing. They aren't trying to establish copyrights or address their scope; they are attempting to speak to what happens in situations where a harm has resulted and no copyright was involved at all.

The court essentially ignores this distinction, asserting that because the DMCA addresses what happens when takedown notices are sent without there being a valid copyright claim, it is the final word on remediating the harm the wrongful takedown notices caused. But this reasoning doesn't make sense.

First, the Constitution narrowly prescribes what federal law can do. It can, for instance, create copyrights (pursuant to the Progress Clause), but it doesn't follow that federal law can necessarily operate, much less exclusively operate, where there is no copyright present. Without that copyright there may be no constitutional basis for that federal law to operate at all. But if the court were right, that once the DMCA is merely cited as a basis for a censorship demand, even if invalidly, it is the only law that can address the resulting harm, then that's what the federal law would be doing: operating in a domain where it may no longer have any constitutional entitlement to act. Particularly given that people aren't even supposed to be able to engage the DMCA without that federally-created copyright in the first place, it really doesn't make sense that the DMCA can remain engaged, trumping state law, when it wasn't supposed to be engaged in the first place.

Granted, it might make sense for the DMCA to pre-empt state law when the takedown notice sender has a valid copyright but nonetheless has sent wrongful takedown notices where the targeted use was fair. If state law could punish those takedown notices, it might interfere with the parameters of that federally-created copyright and encroach the "field" of copyright law left exclusively to federal law. But in the absence of a valid copyright, federal law should not be able to extinguish a state-based claim that has nothing to do with the contours of a right that isn't even present.

And the reason federal law should be so limited is because of the abuse we see, where anyone can get away with tortious behavior simply by fraudulently claiming a fictional federal right. A takedown notice sent by someone without a valid copyright is not any more about the "field" of copyright than it is about Santa Claus. Rather, it's about tortiously wrongful behavior. And vindicating injuries caused by such behavior is not something that federal law generally gets to do. That is a power generally left to the states, and the Constitution should not permit a bad actor to escape state law designed to punish this sort of behavior simply because he's fraudulently packaged up his bad acts with a meaningless copyright label federal law does not allow him to use.

Read More | 10 Comments | Leave a Comment..

Posted on Free Speech - 23 March 2018 @ 1:23pm

Tenth Circuit Issues A Troubling Ruling Limiting New Mexico's Anti-SLAPP Statute In Federal Court

from the It's-Erie-how-problematic-this-decision-is dept

Last week the Tenth Circuit refused to let New Mexico's anti-SLAPP statute be used in federal court in diversity cases. The relatively good news about the decision is that it is premised heavily on the specific language of New Mexico's statute and may not be easily extensible to other states' anti-SLAPP laws. This focus on the specific language is also why, as the decision acknowledges, it is inconsistent with holdings in other circuits, such as the Ninth. But the bad news is that the decision still takes the teeth out of New Mexico's statute and will invite those who would abuse judicial process in order to chill speech to bring actions that can get into the New Mexico federal courts.

In this case, there had been litigation pending in New Mexico state court. That litigation was then removed to federal court on the basis of "diversity jurisdiction." Diversity jurisdiction arises when the parties in the litigation are from separate states and the amount in controversy is more than $75,000 and the issue in dispute is solely a question of state law. Federal courts ordinarily can't hear cases that only involve state law, but because of the concern that it could be unfair for an out-of-state litigant to have to be heard in a foreign state court, diversity jurisdiction can allow a case that would have been heard in state court to be heard by the federal one for the area instead.

At the same time, we don't want it to be unfair for the other party to now have to litigate in federal court if being there means it would lose some of the protection of local state law. We also don't want litigants to be too eager to get into federal court if being there could confer an advantage they would not have had if the case were instead being heard in state court. These two policy goals underpin what is commonly known as the "Erie doctrine," named after a 1938 US Supreme Court case that is still followed today.

The Erie doctrine is why a case removed to federal court will still use state law to decide the matter. But sometimes it's hard to figure out how much state law needs to be used. Federal courts have their own procedural rules, for instance, and so they are not likely to use procedural state rules to govern their proceedings. They only will use substantive state law. But it turns out that figuring out which a law is, procedural or substantive, is anything but straightforward, and that is the question at the heart of this Tenth Circuit case: was New Mexico's anti-SLAPP law procedural, in which case the federal court did not have to follow it, or substantive, in which case it did? And unfortunately in this case, Los Lobos Renewable Power LLP v. Americulture, Inc., the Tenth Circuit decided it was "hardly a challenging endeavor" to decide that it was only procedural.

It based a significant portion of its decision on language unique to the New Mexico statute that differed from other states' and emphasized its procedural operation:

Unlike many other states’ anti-SLAPP statutes that shift substantive burdens of proof or alter substantive standards, or both, under no circumstance will the New Mexico anti-SLAPP statute have any bearing on the suit’s merits determination. See, e.g., Makaeff v. Trump Univ., LLC, 715 F.3d 254 (9th Cir. 2013) (addressing a California anti-SLAPP statute that shifted substantive burdens and altered substantive standards).

It also looked to a New Mexico state supreme court decision that had used substantive/procedural language as part of its consideration of a different anti-SLAPP case:

The New Mexico Supreme Court’s recent decision in Cordova v. Cline, 396 P.3d 159 (N.M. 2017), supports our reading of the anti-SLAPP statute to a tee. ... The court could not have made itself any clearer: “While the Anti-SLAPP statute provides the procedural protections [the members] require, the Noerr-Pennington doctrine is the mechanism that offers [the members] the substantive First Amendment protections they seek.”

But picking out this language of the Cordova case to base its holding on suggests that the Tenth Circuit seriously misread what the New Mexico Supreme Court case was saying and all the effort it had made in its ruling to ensure that the state anti-SLAPP law would, in fact, have substantive effect in that case:

To curtail SLAPP suits, New Mexico enacted an Anti-SLAPP statute. Section 38-2-9.1. The Legislature enacted the Anti-SLAPP statute with the policy goal of protecting its citizens from lawsuits in retaliation for exercising their right to petition and to participate in quasi-judicial proceedings. Section 38-2-9.2. In order to accomplish this goal, the Legislature created expedited procedures for dismissing actions "seeking money damages against a person for conduct or speech undertaken or made in connection with a public hearing or public meeting in a quasi-judicial proceeding before a tribunal or decision-making body of any political subdivision of the state," Section 38-2-9.1(A), and allowing for the recovery of costs and attorney fees incurred in pursuing the dismissal, Section 38-2-9.1(B). … We conclude that the Legislature intended to protect all public participation, whether it be in quasi-judicial proceedings or public hearings. The specific protection in the Anti-SLAPP statute for participation in public hearings before tribunals also comports with a national political ethos, that "encourage[s], promote[s], and purport[s] to protect citizens' testifying, debating, complaining, campaigning, lobbying, litigating, appealing, demonstrating, and otherwise `invoking the law' on public issues." George W. Pring & Penelope Canan, "Strategic Lawsuits Against Public Participation" ("SLAPPS"): An Introduction for Bench, Bar and Bystanders, 12 Bridgeport L. Rev. 937, 945-46 (1992); see also Rowe & Romero, supra, at 221-23 (summarizing a lawsuit filed in state district court against protestors who appealed city approval of Wal-Mart's development plan to the district court and then the Court of Appeals and describing the lawsuit as a SLAPP because it was intended to discourage the protestors' public participation in opposing the development).

It's this language from the New Mexico Supreme Court opinion upholding the anti-SLAPP statute that should have informed the Tenth Circuit's analysis, not the substantive/procedural language that it used in an entirely different context than in the case before the Tenth Circuit. The bottom line is that with an operative anti-SLAPP law public participation in New Mexico is protected from costly litigation. Without it public participation in New Mexico has no such protection. But the Tenth Circuit's ruling means that New Mexico speakers only get the benefit of that protection if the people who try to sue them are local to New Mexico. If they instead have the misfortune of being sued by an out-of-state plaintiff able to assert diversity jurisdiction to get the case into federal court, they will suddenly be stripped of it.

The degree to which this deprivation obviously frustrates New Mexico legislative intent to protect speech, and leaves speech vulnerable to chilling abuse of process, shows just how substantive anti-SLAPP law really is, and thus just how out-of-step with the Erie doctrine the Tenth Circuit deeming it merely procedural really is. It's also inconsistent with another part of the decision where the Tenth Circuit itself seemed to recognize the anti-SLAPP law's substantive import.

As part of the same decision, the court also had to rule on whether it could even consider this interlocutory appeal of the district court's denial to enforce the New Mexico anti-SLAPP statute. Due to a missed deadline by the defendant, the court had to engage in a meaningful analysis that included assessing just how pivotal it was for the court to rule on the anti-SLAPP applicability question now, and not after the full case examining the merits of the lawsuit had concluded. And the court found that it was indeed very important:

"[W]ere we to wait for this case to conclude in the court below by ordinary process, the statute’s sole aim would already be lost. Defendants would have already incurred the ordinary time and expense of litigation that the statute potentially grants them a right to avoid. Indeed, we can reverse the rulings of a hi court, but we cannot order away proceedings and legal fees that have already passed into history. Nor can we remand the case with instructions to “do it again, but faster this time.”

This very same finding regarding the law's effect, a finding that underpinned the Tenth Circuit's ability to even consider the appeal at all, should also have led it to conclude that the anti-SLAPP law was in fact substantive, and thus applicable in federal court. Instead, however, when it came to considering the question of its applicability the court suddenly forgot about this significance. It based its decision on semantics, rather than substance, and in contravention of what the Erie doctrine at its root requires.

Read More | 10 Comments | Leave a Comment..

Posted on Techdirt - 22 March 2018 @ 10:44am

Wherein Facebook Loses Recess For Everyone

from the with-Facebook-friends-like-these dept

Hold on tight to those memories of all the good things the Internet has brought. SESTA has just passed the Senate, and at this point it's a clear legislative path to undermining Section 230, the law that has enabled all those good things the Internet has offered.

It is not entirely Facebook's fault: opportunists from Hollywood saw it as a chance to weaken the innovation that weakens their antiquated grip over people's creativity. Ill-informed celebrities, who understood absolutely nothing about the cause they professed to advocate for, pressed their bumper-sticker demands that something be done, even though that something is destructive to the very cause the bumper-stickers were for. Willfully ignorant members of Congress then bought into the bumper-sticker rhetoric, despite all the evidence they had about how destructive this law would be to those interests and online speech generally.

Even frequent innovation ally Senator Wyden joined the chorus mounting against the tech industry, lending credence to the idea that when it came to a law that would undermine the Internet, the Internet had it coming.

With all due respect, that criticism is not fair. Setting aside that many of these companies didn't even exist twenty years ago, we have never before lived in a world where we could all talk to each other. It makes no sense to punish the people who have enabled this gift simply because we haven't quite figured out how best to manage it. We are but toddlers in Internet time, and just as we would not crush a toddler's ability to learn to do better, it makes no sense to punish today's Internet service providers, or future innovators, or speakers, simply because figuring out how to handle the promise of this global interconnectivity is hard. We cannot let the reactionary antipathy against Facebook mask difficult issues that need to be carefully teased apart before applying regulatory "solutions."

But when we tally the score on whose fault today is, plenty can still be laid at Facebook's door. Again, not all of its current troubles are necessarily of its own making: in addition to being square in the eye of the worst growing pains that computer-mediated communication can offer, it has also been misused, and even potentially illegally manipulated, by bad actors keen to exploit the inherent vulnerabilities presented by this shift from a world of physical scarcity to a world of digital plenty. Meanwhile doctoral theses in organizational theory could be written about the challenges faced by large companies, especially those that have grown so quickly, in reacting to the challenges their success has invited. In other words, we need to separate which expectations of the company are reasonable from those that are not necessarily fair to expect from an enterprise pioneering a new business that could not have even existed just a few years ago.

Yet while much of what Facebook does should be viewed charitably, it is not beyond criticism. To say it is like a bull in a china shop would be unfair to bulls, who at least seem to have some awareness of the chaos they leave in their wake as they throw their weight around. Whereas Facebook seems to have little insight into just what it is that it does, where it lives in the Internet ecosystem, and who is in there with it. As it blunders about, stoking outrage that makes people too upset to see the need for nuance in regulatory response, it also interferes with those advocating for that nuanced regulatory response. It is becoming very hard to trust Facebook as a partner in addressing the complex issues its business choices raise when the company itself seems to lack any coherent understanding of what those choices are. After all, what exactly is the business of Facebook? Is it to aggregate data, or to connect people and intermediate their speech? Or something else? These competing agendas antagonize users and cloud the regulatory waters, leading to overreactions like SESTA that end up hurting everyone. The bitter irony of SESTA, of course, is that it only punishes the good things Facebook does—the being a global platform facilitating speech and interpersonal connections around the world—that benefit our lives, and not those that give us pause. But it also makes sure that no one else will be able to come along and perform any of these functions any better.

Furthermore, it should not be forgotten that, as a matter of politics, Facebook allowed this regulatory travesty to happen. Its shocking endorsement of these dysfunctional policies undermined the resistance that the speakers and innovators were trying to mount against these policies that so that threaten them. Facebook may be foolish enough to believe it can endure the regulatory shift SESTA will bring, but even if it were correct, no one else can. Not even Facebook's own users.

Today is a sad day for the future and all the speech, innovation, and interconnectivity we were counting on to help us confront the challenges of living together in this increasingly small world. There is plenty of blame to go around, but the oblivious insularity of one of the biggest actors in the policy space is a deserving recipient of much of it. Not only was it a lightning rod for regulatory outrage, not entirely undeservedly, but it then greased the skids for the worst of it, indifferent to the effects on others. It will surely suffer from its choices, but so will everyone else.

44 Comments | Leave a Comment..

Posted on Techdirt - 16 March 2018 @ 10:45am

Internet Wins, And The Need To Appreciate What We've Got Before It's Gone

from the golden-goose-preservation dept

It's become quite fashionable these days to gripe about the Internet. Even some of its staunchest allies in Congress have been getting cranky. Naturally there are going to be growing pains as humanity adapts to the unprecedented ability for billions of people to communicate with each other easily, cheaply, and immediately for the first time in world history. But this communications revolution has also brought some extraordinary benefits that we glibly risk when we forget about them and instead only focus the challenges. This glass is way more than half full but, if we're not careful to protect it, soon it will be empty.

As we've been talking about a lot recently, working its way through Congress is a bill, SESTA/FOSTA, so fixated on perceived problems with the Internet (even though there's no evidence that these are problems the Internet itself caused) that it threatens the ability of the Internet to deliver its benefits, including those that would better provide tools to deal with some of those perceived problems, if not outright make those same problems worse by taking away the Internet's ability to help. But it won't be the last such bill, as long as the regulatory pile-on intending to disable the Internet is allowed to proceed unchecked.

As the saying too often goes, you don't know what you've got till it's gone. But this time let's not wait to lose it; let's take the opportunity to appreciate all the good the Internet has given us, so we can hold on tight to it and resist efforts to take it away.

Towards that end, we want to encourage the sharing and collection of examples of how the Internet has made the world better: how it made it better for everyone, and how it even just made it better for you, and whether it made things better for good, or for even just one moment in one day when the Internet enabled some connection, discovery, or opportunity that could not have happened without it. It is unlikely that this list could be exhaustive: the Internet delivers its benefits too frequently and often too seamlessly to easily recognize them all. But that's why it's all the more important to go through the exercise of reflecting on as many as we can, because once they become less frequent and less seamless they will be much easier to miss and much harder to get back.

25 Comments | Leave a Comment..

Posted on Techdirt - 27 February 2018 @ 12:01pm

Anti-NRA Censorship Efforts Echo Earlier Pro-NRA Censorship Efforts, And Learn No Lessons From Them

from the no-laugh-in-matter dept

Lately I've been enjoying watching re-runs of Rowan & Martin's Laugh-In. It's somewhat reassuring to watch a previous generation get through a period of political angst as we go through this current one, especially as there are quite a few parallels that can be drawn.

I mention this because as people call for Amazon, Apple, Roku, and YouTube to drop NRA-TV, I realize that we've seen calls for censorship like this before. What's happening today:

Amazon, Apple, Roku and YouTube are facing increased calls to drop the National Rifle Association’s TV channel from their streaming services, as backlash against the organization grows following a Florida school shooting last week that killed 17 people.

On Thursday, Brad Chase ― a friend of Daniel Reed, the father of a Marjory Stoneman Douglas High School student who survived the shooting ― started a Change.org petition urging Amazon to drop the channel.

“The NRA has long ignored its role in promoting gun violence and betrayed the names of good and responsible gun owners,” Chase wrote on the petition’s page. “It’s time to hold them, and their partners, accountable ... a company like Amazon should not be spreading their message.”

But compare these calls for television networks to drop pro-NRA views with the calls NRA supporters used to make to television networks to pressure them to drop anti-NRA views instead.

In the case of Laugh-In, a precursor to shows like Saturday Night Live and often lauded for its humorous handling of topics of public interest, it appears that gun control was one topic that was off-limits to it. From a letter Dan Rowan wrote in October 1973, lamenting his show's inability to do a send-up of America's gun control laws because the TV network was too afraid of the NRA to allow Laugh-in take it on:

...[T]here are so many things we can't talk about because [the network is] running so damn scared. We have been trying to get a gun control piece on since the beginning of the season, and they are so afraid of the NRA lobby we haven't been able to. Now I don't know one solid argument against the control of hand guns and we will keep trying but that's just one example of the problem.

(From the book, "A Friendship: The Letters of Dan Rowan and John D. McDonald, 1967-1974.")

Granted, this comment came up in the context of Rowan's broader frustration with a much more general culture of fear at the network, which appears to have been predicated on licensing concerns due to the saber-rattling of eventually-deposed Vice President Spiro Agnew. But the essential point remains that pressure by people with one set of views was preventing the airing of any contrary views. And so the future inherited ignorance on the subject, because that's what censorship gives it.

Television is not what it was in the 1970s, when the major networks served as gatekeepers. Now Amazon, Apple, and Roku et al play the role of the gatekeepers. And the consequences of asking them to close their gates to certain ideas will be the same now as they were then: the loss of important discourse, discourse we need in order to achieve meaningful and lasting change.

There are of course a few points to note here. One is that asking television networks to censor is different than asking other businesses to cut ties to organizations whose views may be odious. Withdrawing sponsorships, for instance, takes away the oxygen an entity needs to survive as a viable enterprise. True, cutting off an avenue for expression may certainly make spreading its ideas more difficult, and perhaps cut down on its income, but it can at most damage the organization. It doesn't get rid of its ideas. Its ideas will persist.

Furthermore these are calls for private censorship, not public censorship, the latter of which the First Amendment applies to. The First Amendment also protects calls for private censorship, but it doesn't make them a good idea. And calls for private censorship have a habit of leaking into public policy. Laugh-In was produced in an age where its network's FCC license was threatened. Apple, YouTube, Roku et al exist in an age where reactive legislatures keep finding themselves tempted to slap the hands of technology companies, whether it's a good idea to or not. It's not a healthy reflex to look to banning an idea as a way to deal with an undesirable one, and it would not be good to become so inured to responding this way in a private context that we tempt in in the public one. The First Amendment doesn't automatically stop every censoring policy, and a lot of damage to discourse can occur before the First Amendment can put an end to an unconstitutional regulatory response.

But the reason it's not a healthy response is because banning ideas is not an effective way to deal with them. The only way to defeat bad ideas is in the marketplace of ideas, where through open conversation a better consensus can evolve. There are no shortcuts; better ideas can't win the day by trying to suppress contrary ones. Pushing for censorship that favors certain ideas only creates a vacuum where those ideas can become artificially distorted and more extreme, with no countervailing views available to temper them. And it risks having those very same preferred ideas later shut out, because restricting public discourse to only some ideas is not the same thing as convincing anyone of their merit.

What is happening to the NRA now is testament to this reality: suppressing gun control discussion didn't give the NRA a world where those contrary ideas no longer existed. Instead it gave itself a world where its own views arguably became more extreme and now stand to be repudiated – or even themselves potentially suppressed.

But such anti-NRA suppression would be unfortunate, for the exact same reason that it was wrong, and ultimately ineffective, when the NRA did it. Censorship only inhibits progress. Meaningful and lasting change only happens when minds are changed, and that can only happen when people can talk freely about the issues affecting them. Perhaps the NRA thought its views had prevailed when it was able to control the public discussion about guns, but the backlash today shows that it was a fleeting and feeble victory. Those who wish to push an alternative policy agenda now should heed that lesson, to make sure that any gains they hope to make are not equally feeble and fleeting.

150 Comments | Leave a Comment..

Posted on Free Speech - 26 February 2018 @ 10:44am

Section 230 Isn't About Facebook, It's About You

from the know-what-you've-got-before-it's-gone dept

Longtime Techdirt readers know how important Section 230 is for the Internet to work, as well as many of the reasons why the proposed SESTA bill threatens the operation of the law, and with it the operation of the Internet. But especially for people less familiar with the ins and outs of Section 230, as the law hangs in the balance, we want to take moment to explain why it's something that everyone should want to preserve.

These days a lot of people are upset with Facebook, along with many other of its fellow big Internet companies. Being upset with these companies can make it tempting to try to punish them with regulation that might hurt them. But it does no good to punish them with regulation that will end up hurting everyone – including you.

Yet that’s what the bill Congress is about to vote on will do. SESTA (or sometimes SESTA-FOSTA) would make changes that reduce the effectiveness of Section 230 of the Communications Decency Act. While a change to this law would certainly hurt the Facebooks of the world, it is not just the Facebooks that should care. You should too, and here's why.

Section 230 is a federal statute that says that people who use the Internet are responsible for how they use it—but only those people are, and not those who provide the services that make it possible for people to use the Internet in the first place. The reason it's important to have this law is because so many people – hundreds, thousands, millions, if not billions of people – use these services to say or do so many things on the Internet. Of course, the reality is, sometimes people use these Internet services to say or do dumb, awful, or even criminal things, and naturally we have lots of laws to punish these dumb, awful, or criminal things. But think about what it would mean for Internet service providers if all those laws that punish bad ways people use the Internet could be directed at them. Even for big companies like Facebook it would be impossibly expensive to have to defend themselves every time someone used their services in these unfortunate ways. Section 230 means that they don't have to, and that they can remain focused on providing Internet services for all the hundreds, thousands, millions, if not billions of people – including people like you – who use their services in good ways.

If, however, Section 230 stops effectively protecting these service providers, then they will have to start limiting how people can use their services because it will be too expensive to risk letting anyone use their services in potentially wrongful ways. And because it’s not possible for Internet service providers to correctly and accurately filter the sheer volume of content they intermediate, they will end up having to limit too much good content in order to make sure they don’t end up in trouble for having limited too little of the bad.

This inevitable censorship should matter to you even if you are not a Facebook user, because it won't just be Facebook that will be forced to censor how you use the Internet. Ever bought or sold something on line? Rented an apartment? Posted or watched a video? Found anything useful through a search engine? Your ability to speak, learn, buy, sell, complain, organize, or do anything else online depends on Internet services being able to depend on Section 230 to let you. It isn't just the big commercial services like Facebook who need Section 230, but Internet service providers of all sorts of shapes and sizes, including broadband ISPs, email providers, online marketplaces, consumer review sites, fan forums, online publications that host user comments… Section 230 even enables non-commercial sites like Wikipedia. As a giant collection of information other people have provided, if Section 230’s protection evaporates, then so will Wikipedia's ability to provide this valuable resource.

Diminishing Section 230's protection also not only affects your ability to use existing Internet services, but new ones too. There’s a reason so many Internet companies are based in the United States, where Section 230 has made it safe for start-ups to develop innovative services without fear of crippling liability, and then grow into successful businesses employing thousands. Particularly if you dislike Facebook you should fear a future without Section 230: big companies can afford to take some lumps, but without Section 230's protection good luck ever getting a new service that's any better.

And that's not all: weakening Section 230 not only hurts you by hurting Internet service providers; it also hurts you directly. Think about emails you forward. Comment threads you allow on Facebook posts. Tweets you retweet. These are all activities Section 230 can protect. After all, you're not the person who wrote the original emails, comments, or tweets, so why should you get in trouble if the original author said or did something dumb, awful, or even criminal in those emails, comments, or tweets? Section 230 makes many of the ordinary ways you use the Internet possible, but without it all bets are off.

30 Comments | Leave a Comment..

Posted on Techdirt - 22 February 2018 @ 1:47pm

Court Destroys Future Public Art Installations By Holding Building Owner Liable For Destroying This One

from the no-good-deed-goes-unpunished dept

Last week was a big week for dramatically bad copyright rulings from the New York federal courts: the one finding people liable for infringement if they embed others' content in their own webpages, and this one about 5Pointz, where a court has found a building owner liable for substantial monetary damages for having painted his own building. While many have hailed this decision, including those who have mistakenly viewed it as a win for artists, this post explains why it is actually bad for everyone.

The facts in this case are basically this: the owner of a run-down, formerly industrial building in a run-down neighborhood aspired to do something to redevelop his property, but it would be a few years before the time would be right. So in the meantime he let some graffiti artists use the building for their aerosol paintings. The building became known as 5Pointz, and the artwork on it soon began to attract attention. The neighborhood also began to change, and with the improvement the prospects for redeveloping the property into residences became more promising. From the outset everyone knew that redevelopment would happen eventually, and that it would put an end to the arrangement since the redevelopment would likely necessitate tearing down the building, and with it the art on the walls. As the date of demolition grew closer, the artists considered buying the building from the owner in order to prevent it from being torn down and thus preserve the art. However the owner had received a variance that suddenly made the value of the property skyrocket from $40 million to $200 million, which made the buyout impossible. So the artists instead sued to halt the destruction of their art and asked for a preliminary injunction, which would ensure that nothing happened to the art while the case was litigated. But in late 2013 the court denied the preliminary injunction, and so a few days later the building owner went ahead and painted over the walls. The painting-over didn't end the litigation, which then became focused on whether this painting-over broke the law. In 2017 the court issued a ruling allowing the case to proceed to trial on this question. Then last week came the results of that trial, with the court finding this painting-over a "willfully" "infringing" act and assessing a $6.7 million damages award against the owner for it.

It may be tempting to cheer the news that an apparently wealthy man has been ordered to pay $6.7 million to poorer artists for damaging their art. True -- the building owner, with his valuable property, seems to be someone who potentially could afford to share some of that wealth with artists who are presumably of lesser means. But we can't assume that a defendant building owner, who wants to be able to do with his property what he is normally legally allowed to do, will always be the one with all the money, and the plaintiff artist will always be the one without those resources. The law applies to all cases, no matter which party is richer, and the judicial reasoning at play in this case could just as easily apply if Banksy happened to paint the side of your house and you no longer wanted what he had painted to remain there. Per this decision, removing it could turn into an expensive proposition.

The decision presents several interrelated reasons for concern. Some arise from the law underpinning it, the Visual Artists Rights Act of 1990, an amendment to copyright law that, as described below, turned the logic of copyright law on its head. But there are also some alarming things about this particular decision, especially surrounding the application of high statutory damages for what the court deemed "willful" "infringement," that accentuate everything that's wrong with VARA and present issues of its own.

With respect to the law itself, prior to VARA the point of copyright law (at least in the US) was to make sure that the most works could be created to best promote the progress of the sciences and useful arts (as the Constitution prescribed). The copyright statute did this by giving creators economic rights, or rights designed to ensure that if there was money to be made from their works, they would have first crack at making it. The thinking was that with this economic incentive, creators would create more works, and thus the public interest goal of having more works created would be realized.

VARA changed this statutory equation for certain kinds of visual works. Instead of economic rights, it gave their creators certain moral rights, including (as relevant for this case), the right to preserve the integrity of their work. This right of integrity includes the right

(A) to prevent any intentional destruction, mutilation, or other modification of that work which would be prejudicial to his or her honor or reputation, and any intentional distortion, mutilation, or modification of that work is a violation of that right, and
(B) to prevent any destruction of a work of recognized stature, and any intentional or grossly negligent destruction of that work is a violation of that right.

Which may sound well and good, but as we see with the costly way the statute plays out, rather than creating economic incentives stimulating the creation of new works, it has now created economic effects inhibiting them, which in the long run will only hurt the artists VARA was intended to help.

The most obvious way it hurts them is by deterring property owners from allowing any art to be installed on their property, because it means that if they do, they may be forever stuck with it. Allowing art to be installed means they will either stand to lose the control they would have had without it (itself a hit to the property's worth), or potentially be faced with thousands if not millions of dollars in liability if they do what they want with their property anyway. And what property owner would want to chance such dire consequences in order to encourage art?

Granted, some of this risk can be ameliorated with written agreements, which were lacking in this case. But if all public art requires lawyered paperwork, it raises costs and will deter both artist and property owner from pursuing this sort of mutually beneficial arrangement. In this case the property owner had let the artists use his building to create, for free, by unwritten agreement simply because at the time they all agreed that it was good for both of them. It will not be good for creativity if we discourage this sort of symbiotic relationship from taking root.

It also will not be good for future artists whose economic interests might have benefited from other such opportunities like those 5Pointz offered. Even in this case the court noted all the evidence presented in "Folios", showing that being able to paint the building had opened up all sorts of doors for the artists to reap further economic rewards for their art. Artists will have fewer opportunities for that sort of career-enhancing exposure if landlords are deterred from giving it to them.

There is an implicit argument present in the plaintiffs' case that some of the rise in the value of the building was due to the artwork, and that it would therefore be just to share some of that windfall with them. But by this same logic, the building owner would have been similarly responsible for, and thus entitled to a portion of, the rise in value of the work of the artists whom he had allowed to exhibit. It would not be good for artists in the long run if they should find themselves needing to share their good fortune with their benefactors – or be potentially liable for any loss in their property value, should the presence of their work diminish it.

This case also stands to have some directly chilling effects on artists. While this case is not about graffiti artists suing each other for painting over each other's works (as the court noted, up to now graffiti artists have routinely painted over each others' works without any more severe penalty than social approbation, if even that), it's not clear why, if the decision stands, the next case couldn't be. The decision found that a VARA claim could be vindicated regardless of whether a work was temporary or permanent, and instead focused on whether a work had achieved the stature needed to be entitled to protection under the statute. It won't be good for artists if they have to fear being tied up in litigation with their peers due to the transient nature of their medium (or locked out of being able to create at all because others have already used all the good spaces first), or caught in a judicial cage match to determine whose work has the stature to be more deserving of protection.

It is possible that the court erred, and transient art falls outside VARA's purview. But there is enough ambiguity in the statute to potentially extend to it, and in any case, the statute's deterring effects would apply to all sorts of art, not just aerosol-painted art. Unfortunately at no point does the decision contemplate these effects, or its effects on other important policy values such as urban planning and affordable housing, if VARA is able to trump other forms of law, such as property law, that normally speak to what a building owner may do. The decision also largely ignores that the building owner had let the artists paint there in the first place, when he didn't have to. And it ignores that the building owner had done this apparently now wrongful painting-over of the art on his walls after this very same court denied an injunction that would have told him not to. None of these factors mattered to the court.

But all of them should matter to us, as should the extremely troubling way the court found his "infringement" (in other words, the painting-over) "willful," and thus subject to heightened damages. This is where the decision not only encapsulates the policy flaws of VARA, but also threatens to be seriously distorting to copyright doctrine (and other law) generally.

One troubling aspect is the punitive attitude by the court towards the building owner for having painted over the art after the very same court had denied an injunction preventing it. In between its order of November 12, 2013 denying the preliminary injunction, and its November 20, 2013 decision explaining its order (embedded below), the building owner had gone ahead and done the painting-over. This act appears to have outraged the court, whose November 20 decision reads more as an explanation for why it probably should have issued the injunction, now that in the intervening time the owner had painted over it.

As the court correctly observed in this 2013 opinion, preliminary injunctions exist so that courts can prevent irreparable harm at the outset that a court is likely to later rule needs to be prevented, if it would be too late to unring the bell at that point. In fact the language the court cited for the injunction is so standard that when the naked order denying the preliminary injunction was issued, it was perfectly reasonable for the building owner to presume that either (a) he was likely to win the case and be able to do what he wanted to the building, or (b) it wasn't such a severe harm if he removed the art now and later the court decided he shouldn't have, or (c) some combination of both. So it reads as a serious miscarriage of justice for the court's 2018 decision to punish him for going ahead and removing the art, or "recklessly disregard[ing] the possibility" that removing it would be wrongful, as the court put it.

Furthermore, if the court is right in its 2018 decision that the painting-over raised a valid VARA claim, then it was wrong to deny the injunction in 2013. Problematic though it is for VARA to introduce non-economic rights into copyright law, the whole point of one of them – the right to maintain the integrity of the work – can only be vindicated with an injunction. If this right were something that could be adequately compensated for by monetary damages, then it would start to look a lot more like an economic right. That's not what VARA was ever intended to create, but it is what the court effectively created back in 2013 when it refused the injunction and deemed monetary damages sufficient to address any harm should the VARA claim later prevail.

As it wrote in a confused passage in its 2013 decision:

Although the works have now been destroyed—and the Court wished it had the power to preserve them—plaintiffs would be hard-pressed to contend that no amount of money would compensate them for their paintings; and VARA—which makes no distinction between temporary and permanent works of visual art—provides that significant monetary damages may be awarded for their wrongful destruction. See 17 U.S.C. §§ 501-505 (providing remedies for VARA violations). In any event, paintings generally are meant to be sold. Their value is invariably reflected in the money they command in the marketplace. Here, the works were painted for free, but surely the plaintiffs would gladly have accepted money from the defendants to acquire their works, albeit on a wall rather than on a canvas.

It continued more bizarrely:

Moreover, plaintiffs’ works can live on in other media. The 24 works have been photographed, and the court, during the hearing, exhorted the plaintiffs to photograph all those which they might wish to preserve. All would be protected under traditional copyright law, see 17 U.S.C. § 106 (giving, inter alia, copyright owners of visual works of art the exclusive rights to reproduce their works, to prepare derivative works, and to sell and publicly display the works), and could be marketed to the general public—even to those who had never been to 5Pointz.

In the court's defense, it is correct that VARA does allow for infringements of moral rights to be compensated by monetary damages. But it shouldn't be the primary form of relief, and the court's punitive use of the highest amount of statutory damages to compensate the artists exemplifies why. Statutory damages are normally for when it is hard to measure economic loss and so we have to instead make some presumptions about how much compensation that loss deserves. There are already plenty of problems with these presumptions tending to allow for the recovery of far more than what actual losses would have been, but this decision magnifies their problematic nature by allowing statutory damages not only to overcompensate economic loss but to overcompensate non-economic loss. In other words, congratulations, we now have "pain and suffering" in copyright cases.

Perhaps in a way we always have – the overuse of statutory damages has always suggested that is really a retributive, rather than truly compensatory, damages measure. In this case, the court is perfectly frank that's what it's doing:

If not for Wolkoff’s insolence, these damages would not have been assessed. If he did not destroy 5Pointz until he received his permits and demolished it 10 months later, the Court would not have found that he had acted willfully. Given the degree of difficulty in proving actual damages, a modest amount of statutory damages would probably have been more in order.

But courts have always maintained the facade that compensation for emotional harm is unavailable in copyright cases. The 5Pointz court even acknowledges this limitation in footnote 18 of its 2018 decision:

Plaintiffs contend that they are entitled to damages for emotional distress. Under traditional copyright law, plaintiffs cannot recover such damages. See Garcia v. Google, Inc., 786 F.3d 733, 745 (9th Cir. 2015) (“[A]uthors cannot seek emotional damages under the Copyright Act, because such damages are unrelated to the value and marketability of their works.”); Kelley v. Universal Music Group, 2016 WL 5720766, at *2 (S.D.N.Y. Sept. 29, 2016) (“Because emotional distress damages are not compensable under the Copyright Act, this claim must also be dismissed.”). Since VARA provides damages under “the same standards that the courts presently use” under traditional copyright law, H.R. Rep. No. 101-514, at 21-22 (1990), emotional damages are not recoverable.

But the outright hostility the court repeatedly shows the defendant, in the language in both decisions, makes it clear that statutory damages are being used to compensate for what is otherwise a purely emotional harm. From the 2018 decision:

The whitewash did not end the conflict in one go; the effects lingered for almost a year. The sloppy, half-hearted nature of the whitewashing left the works easily visible under thin layers of cheap, white paint, reminding the plaintiffs on a daily basis what had happened. The mutilated works were visible by millions of people on the passing 7 train. One plaintiff, Miyakami, said that upon seeing her characters mutilated in that manner, it "felt like [she] was raped." Tr. at 1306:24-25.

There are good reasons why we do not allow copyright to remediate hurt feelings, not the least of which being that they are likely to run raw on both sides. From an article from last year (before the $6.7 million judgment):

Wolkoff feels betrayed by the artists he thought he was helping by lending them his wall to bomb. He cried when the building came down, he confessed, and said he would bring back more street artists to paint at the location after the renovation—just not those who sued.

Notably in its 2017 ruling (also embedded below) allowing the VARA claim to go forward, the court dismissed the artists' claims for intentional infliction of emotional distress, despite the strong emotions the case had engendered.

Because the defendants destroyed 5Pointz only after the Court dissolved its temporary restraining order and did no more than raze what they rightfully owned, the defendants simply did not engage in the kind of outrageous and uncivilized conduct for whose punishment this disfavored tort was designed.

And therein lies the rub: the building owner did no more than what other law clearly allowed. But by allowing artists to bring claims for the "intentional distortion, mutilation, or other modification . . . [of works that] would be prejudicial to [the artist’s] honor or reputation" the court has set up a direct conflict between VARA and what traditional copyright law, and traditional property law, have allowed. And it has done this without addressing any of the implications of this new policy collision.

Read More | 46 Comments | Leave a Comment..

More posts from Cathy Gellis >>