A previous post discussed what the recently released files of the late Associate Supreme Court Justice John Paul Stevens revealed about development of the Court’s decisions in Lotus v. Borland, MGM v. Grokster, and Eldred v. Ashcroft. This post looks at the disclosures contained in the files for Quality King v. L’anza, New York Times v. Tasini, and Dastar v. Twentieth Century Fox. Most significant are Justice Stevens’ rejection of Justice Ginsburg’s efforts to prevent parallel imports of grey market goods in Quality King.

Quality King v. L’anza

This case posed the question of whether the importation right in 17 U.S.C. § 602(a) is subject to the first sale doctrine codified in 17 U.S.C. § 109(a). L’anza affixed a copyrighted label to its haircare products manufactured in the United States. It sold the products overseas at a lower price than in the United States. Quality King purchased the products in Malta and then imported them back to the United States. L’anza sued Quality King for infringing its right under section 602(a) to prohibit the importation of copies of its work without authorization. The district court ruled against Quality King and the U.S. Court of Appeals for the Ninth Circuit affirmed. 

On March 9, 1998, Justice Stevens delivered the unanimous opinion of the Court that, as a matter of statutory interpretation, the importation right in section 602(a) is subject to the first sale doctrine. Under the first sale doctrine, the owner of a copy of a work “lawfully made under this title” does not infringe the distribution right by selling or lending that copy. In effect, the distribution right in that copy is exhausted by the first authorized sale of that copy. Because the products at issue here were “lawfully made under this title,” as required by section 109(a), Quality King did not infringe the importation right when it imported L’anza’s products. 

Justice Ginsburg wrote a short concurring opinion stressing that this case involved a product manufactured in the United States. She joined the Court’s opinion “recognizing that we do not resolve today cases in which the allegedly infringing imports were manufactured abroad.” She then cited William Patry’s statement in his treatise that “the words ‘lawfully made under this title’ in the ‘first sale’ provision, 17 U.S.C. § 109(a), must mean ‘lawfully made in the United States.’”

The cover sheet for Justice Stevens’ case file indicates that all nine Justices voted in favor of cert. Six of the Justices voted at the December 10, 1997 conference to reverse. Chief Justice Rehnquist and Justice Ginsburg had question marks by their names, while Justice Kennedy seemed to have supported affirmance. According to Justice Stevens’ difficult to read notes, Justices O’Connor and Ginsburg mentioned fair use at conference, while Kennedy indicated he was “troubled by fair use.”

Justice Stevens was assigned the task of writing the majority opinion. He circulated the first draft on February 10, 1998. On February 12, Justice Ginsburg sent him a letter stating that “although I voted the other way at Conference, I am rethinking my position based upon the main line of your opinion” concerning the relationship of sections 602(a), the first sale doctrine, and the distribution right. However, Justice Ginsburg suggested several revisions to the opinion, most notably about the place of manufacture. “This case is about ‘roundtrips,’ as you recognize…, U.S.-manufactured goods sent abroad, then imported back. I don’t think we have before us the case of goods manufactured abroad, then imported. To keep the opinion focused on this case,” Justice Ginsburg recommended emphasizing in several places in the opinion that L’anza’s products were manufactured in the United States. 

On February 16, Justice Stevens responded to Justice Ginsburg’s letter. While he accepted several of her proposed modifications, he refused to focus on the site of the manufacture. “I do not think, however, that it is necessary or desirable to emphasize that we are concerned only with products made in the United States. This case does involve U.S.-made products, of course, as the opinion already makes clear, but I see no reason to go out of our way to incorporate an express place-of-manufacture limitation.”

On February 20, Justice Ginsburg more explicitly pushed for a place-of-manufacture limitation. “Following up on my suggestion on limiting the opinion to U.S.-made products, I enclose the most relevant pages” from William Patry’s copyright treatise. Throughout, Patry “distinguishes between works ‘made outside the United States’ and works ‘lawfully made in the United States.’”

Later that day, Justice Stevens wrote back, 

You are … correct that Patry would distinguish between goods lawfully made in the United States and goods made outside the United States. I have considered Patry’s argument, however, and I am not persuaded by it. Nothing in the statute suggests that the place where either the products or the copyrighted labels were manufactured is relevant. Indeed, petitioner, respondent, and the United States agree that the place of manufacture is not dispositive of the question presented in this case. I see no justification in the statute or the case law for distinguishing between a copy made abroad with the authorization of the U.S. copyright holder and a U.S.-made copy sent abroad with the authorization of the U. S. copyright holder. In my view, both would be “lawfully made under this title.” Otherwise, L’anza could make the copyrighted labels in Mexico, affix them to their U.S.-made hair products, sell them abroad, and claim entitlement to protection from unauthorized importation under § 602(a) despite the first-sale doctrine.

Justice Stevens added,

This case involves only U.S.-made products, of course, and our holding is necessarily limited by the facts presented here. The absence from the opinion of any discussion of place of manufacture does not foreclose our consideration of that issue in a future case. The problem with emphasizing the place of manufacture now is that such emphasis would imply that place of manufacture is important to our analysis. I do not think that it is important, however, and I do not think our opinion suggests any answer to the question whether place of manufacture is relevant. If it were to do so, I would prefer to suggest an answer contrary to Patry’s.

By resisting Justice Ginsburg’s attempt to include a place of manufacture limitation, Justice Stevens kept the issue open for future consideration. The Court granted cert on this question in Costco v. Omega, but split 4-4 with Justice Kagan recusing herself. The Court granted cert. on this question again in Kirtsaeng v. Wiley. By then, Justice Stevens had retired from the Court. But Justice Breyer, in an opinion for a 6-3 majority, echoed the position articulated by Justice Stevens in his correspondence with Justice Ginsburg: that the first sale doctrine applies to copies made abroad with the authorization of the U.S. copyright owner. 

The Stevens papers also contain a February 27, 1998 letter from Justice Kennedy. He stated that Justice Stevens’ draft opinion addressed the concerns he had with L’anza’s argument and that “in all respects your opinion is convincing….” Justice Kennedy was willing to join it, provided that Justice Stevens resolved two matters. First, the second to the last sentence of the draft opinion stated that “We owe no deference to the State Department’s interpretation of the Act because it has no responsibility for enforcing or administering it.” Justice Stevens wrote this sentence in the context of declaring the irrelevance of executive agreements prohibiting the unauthorized importation of copies of the works of U.S. copyright owners. Justice Kennedy noted that “it is likely correct that, since the State Department does not have the responsibility to enforce the copyright act, it has no expertise in interpreting it.” However, he feared “the statement will be quoted out of context in those numerous instances where State is required to make certain representations about American law.” For this reason, Justice Kennedy suggested deleting the sentence or rewriting it.

Second, in support of his point that section 602(a) did not create a right separate from the distribution right in section 106(3), and thus a right not limited by the first sale doctrine, Justice Stevens contrasted the wording of section 602(a) with that of 106A, which created moral rights in visual works distinct from the exclusive economic rights in section 106. Justice Stevens included a footnote explaining that section 106A was adopted in response to the U.S. accession to the Berne Convention. Footnote 21 originally contained this sentence: “Thus, Congress made a considered choice in drafting § 106A and did not simply import the provisions of the Berne Convention wholesale into U. S. copyright law.” Justice Kennedy’s “concern is that the sentence could be read to suggest the U.S. is not in compliance with this aspect of the Berne Convention.” Accordingly, he suggested deleting the sentence. Justice Stevens made the two deletions requested by Justice Kennedy, and Justice Kennedy joined his opinion. (Justice Ginsburg requested another deletion to footnote 21 for a similar reason, which Justice Stevens also made).

New York Times v. Tasini 

17 U.S.C. § 201(c) provides that the owner of a copyright in a collective work is presumed to have acquired the privilege of reproducing and distributing the individual contributions to the work in “any revision of that collective work.” This had long been interpreted to permit a newspaper publisher to authorize the making of a microfiche version of back-issues of the newspaper without seeking the permission of all the freelance journalists whose articles appeared in the newspaper. The New York Times and other newspaper publishers licensed LexisNexis to create an electronic database of the back-issues of their newspapers, from which articles could be accessed individually. A group of freelance writers sued the publishers, claiming that the database was not a “revision” of the collective work within the meaning of section 201(c). Then-district court Judge Sotomayor found for the publishers. The Second Circuit reversed, and the publishers petitioned for cert. On June 25, 2001, the Supreme Court affirmed the Second Circuit by a 7-2 margin with the majority opinion written by Justice Ginsburg. Justice Stevens wrote a dissent, which Justice Breyer joined.

The cover sheet for the case file indicates that Justices Stevens, Breyer, and Kennedy supported the grant of cert., with Justice O’Connor voting “J-3,” meaning she supported the grant of cert. if three other Justices voted in favor. Accordingly, cert. was granted. The cover sheet also indicates that at the March 30, 2001 Conference seven Justices supported affirmance of the Second Circuit’s decision, with Justices Stevens and Breyer favoring reversal.

Justice Stevens’ files reveal few changes in the development of both the majority and dissenting opinions. After Justice Ginsburg distributed her first draft, Justice O’Connor raised an interesting concern with one sentence. At the beginning of her analysis of the case’s core legal issue in section III of her opinion, Justice Ginsburg stated: “The Copyright Act’s ultimate concern is the way works are presented to, and comprehensible by, the human reader, viewer, or listener.” In a letter dated June 6, 2001, Justice O’Connor wrote that she understood “the point of this sentence to be that, while the parties make arguments concerning how the Articles exist in the Databases in a technological or metaphysical sense, the proper focus of the inquiry is on the works as presented to and perceived by the Database users.” Justice O’Connor agreed with this focus, but had two concerns about the sentence as written. First, 

the “ultimate concern” of the Copyright Act is actually the protection of original expression so as “[t]o promote the Progress of Science and useful Arts,” U.S. Const., Art. I, § 8, cl. 8. While perceptibility is one concern of the Copyright Act in a functional sense, it seems to me that the “ultimate concern” claim is too sweeping and not quite accurate. 

Second, 

the sentence is somewhat misleading in that the Copyright Act is not at all concerned with the way in which works are presented to and perceived by human beings. Indeed, the purpose of the 1976 Act’s elaboration of § 102’s fixation requirement is to ensure that the manner of presentation has no effect on copyrightability. […] Section 102’s fixation requirement ensures that works enjoying copyright protection are capable of perception from a tangible medium, but it does not matter how they are perceived for purposes of copyrightability. A sentence that links the Copyright Act’s “ultimate concern” to the “way” in which works are presented might be used to attack medium neutrality or for some other misleading purpose. The risk of misuse seems particularly great because the sentence is eminently quotable and appears at an important juncture in the opinion.

On this basis, Justice O’Connor proposed replacing the troubling sentence with a more neutral one: “In determining whether the Articles have been reproduced and distributed as part of a revision of the collective works, the proper focus of our inquiry is that which is presented to and perceived by the users of the Databases.” Justice Ginsburg responded later that day, telling Justice O’Connor, “[y]ou are absolutely right.” Justice Ginsburg went on to propose slight modifications to Justice O’Connor, which she included in the final opinion: “In determining whether the Articles have been reproduced and distributed ‘as part of’ a ‘revision’ of the collective works in issue, we focus on the Articles as presented to, and perceptible by, the user of the Databases.”

Justice O’Connor was correct that Justice Ginsburg’s original formulation would have been susceptible to misuse for the reasons she stated. Additionally, the exchange between Justice O’Connor and Justice Ginsburg reflects the care the Justices exercised to ensure that their opinions were not misconstrued.

The case file also contained correspondence relating to Justice Stevens’ dissent. On April 25, 2001, Justice Stevens sent a letter to Justice Breyer confirming an agreement they had reached in an earlier telephone conversation that Justice Stevens would draft a dissent in Tasini while Justice Breyer would draft a dissent in Tyler v. Cain, a case then pending relating to the Antiterrorism and Effective Death Penalty Act of 1996. They each ultimately joined the other’s dissenting opinion.

Further, on June 15, 2001, Justice Breyer sent Justice Stevens a lengthy letter containing “a rough version of a few ideas” Justice Breyer had for the dissent. Justice Breyer acknowledged that “I think you already say most of what is in there,” but invited Justice Stevens to “use any additional material that you find useful.” Justice Breyer added that “I do think we should say something about the need for Congress to address this issue.” 

Justice Breyer’s letter stated that “Macaulay wrote that copyright is ‘a tax on readers for the purpose of giving a bounty to writers.’ That tax restricts the dissemination of writings, but only insofar as necessary to encourage their production, the bounty’s basic objective.” Justice Stevens used this precise language in section IV of his dissent. Justice Breyer subsequently employed the Macaulay quotation in his dissents in Eldred v. Ashcroft and Golan v. Holder and his opinion for the majority in Google v. Oracle. 

Likewise, Justice Breyer noted that the Court’s decision would lead to incomplete electronic databases, which might necessitate congressional intervention.

If the problem is genuine and important (as amici now tell us that it is), congressional action may well be necessary to preserve present databases in their entirety. Compare 17 U.S.C. § 108(d) (1). At the least, Congress can determine the nature and scope of the problem and fashion any necessary licensing remedy far more easily than can courts. 

Justice Stevens included similar language in footnote 18 of his dissent: 

If the problem is as important as amici contend, congressional action may ultimately be necessary to preserve present databases in their entirety. At the least, Congress can determine the nature and scope of the problem and fashion an appropriate licensing remedy far more easily than can courts. Compare 17 U.S.C. §108(d)(1).

Dastar v. Twentieth Century Fox Films 

Dastar distributed without attribution copies of a television series owned by Twentieth Century Fox that had entered into the public domain. The Ninth Circuit found that this constituted reverse passing off in violation of the Lanham Act. On June 2, 2003, the Supreme Court reversed by an 8-0 vote with an opinion written by Justice Scalia; Justice Breyer took no part in the consideration or decision of the case. 

The Stevens case file confirms that Justice Breyer did not participate in the case because his brother sat on the Ninth Circuit panel below. (Charles Breyer is a U.S. district court judge for the Northern District of California. He participated in the Ninth Circuit panel in this case by designation.) According to the case file cover sheet, Justices Stevens, O’Connor, and Kennedy supported the grant of cert., with Justice Ginsburg voting J-3. The cover sheet indicates that seven of Justices voted at the April 4, 2003, Conference to reverse the Ninth Circuit, and Justice Ginsburg was undecided. The file contains no substantive correspondence among the Justices concerning Justice Scalia’s opinion, nor what convinced Justice Ginsburg to support reversal. Evidently, the Justices saw this as an easy case.

What Influences Decisions

The case file for Dastar underscores the importance of the parties’ counsel, at least for the decision whether to grant cert. A memo from a clerk to Justice Stevens on the cert.-worthiness of the case noted that “Petr has good counsel (Professor Nimmer is on the brief) as do resps.” Later in the memo, the clerk repeated that “the lawyering is good.” Significantly, the clerk expressed concern with addressing this issue without Justice Breyer’s participation. “Not only would that make it an 8-member Ct, it would also take away Justice Breyer in a case that he would likely have a keen interest as well as a distinctive view.” Although Justice Breyer may have had a “distinctive view” on IP matters, it was one shared by Justice Stevens, and the clerk may have anticipated that Justice Stevens would be reluctant to grant cert. without his most reliable copyright ally. 

Originally posted to the DisCo Project website. Reposted here with permission.

The recently released files of the late Associate Supreme Court Justice John Paul Stevens reveal interesting details concerning some of the Court’s significant copyright decisions, but leave important questions unanswered. Justice Stevens (1920-2019) left his papers to the Library of Congress, which opened them to the public in May 2023. (See here for a blog post on Justice Stevens’ important decisions relating to information technology.) While the papers to do not provide additional information about Justice Stevens’ pivotal role in the shaping of the Sony v. Universal (“Betamax”) decision, revealed by Justice Thurgood Marshall’s files, they do increase our knowledge about Lotus v. Borland, MGM v. Grokster, and Eldred v. Ashcroft.

Lotus v. Borland

The First Circuit ruled in 1994 that Borland did not infringe Lotus’ copyright when it copied the Lotus 1-2-3 command structure in its competing spreadsheet program because the command structure was an unprotectable method of operation under 17 U.S.C. § 102(b). The Supreme Court granted certiorari in 1995 and heard oral arguments in 1996. Soon thereafter, the Court issued a short per curiam decision, stating that the First Circuit’s judgment was affirmed by an equally divided court, and that Justice Stevens took no part in the consideration or decision of the case.

Justice Stevens’ files confirm the reason Justice Stevens recused himself. As stated in a memo from an unidentified clerk, “In light of your policy of disqualifying yourself from cases in which IBM is a party, my recommendation is that you DISQUALIFY.” IBM had purchased Lotus in early 1995, and Justice Stevens appeared to have owned IBM stock. 

The cover sheet for the case file indicates that Justice Stevens was “out,” that Justices Rehnquist, O’Connor, Scalia, Ginsburg, and Breyer had voted in favor of cert., and Justices Kennedy, Souter, and Thomas voted against cert. Ginsburg had voted “J-3,” that is, she would join in favor of cert. if three other Justices supported cert. (cert. is granted if four Justices vote in favor). Unfortunately, the cover sheet does not indicate how each Justice voted on the merits—that is, how a 5-3 vote in support of cert. became a 4-4 tie. Nothing else in the file does either. One can speculate that Justice Breyer may have supported cert. because of his interest in the subject matter, but then voted against reversal. Perhaps the papers of Justices Scalia and Ginsburg, if they are made public, will disclose the voting on the merits.

The clerk’s memo, which discussed the case for Justice Stevens’ information notwithstanding the recommendation that he disqualify himself, contained interesting commentary. The issue raised by the case is described as “difficult and interesting.” The clerk advised that “you might find the [petition] interesting reading, even if you disqualify yourself.” After discussing the facts and the holdings below, the clerk remarks that the petition “touches on one aspect of the extremely difficult problem of applying copyright law to computer programs. Unsurprisingly, the issue has attracted top lawyers ([petitioner’s] lawyers include Charles Fried and Arthur Miller) and several amicus briefs.”

The issue raised by Lotus v. Borland was indeed “difficult and interesting,” and it wasn’t resolved for 27 years until Google v. Oracle.

Eldred v. Ashcroft

The D.C. Circuit in 2001 upheld the constitutionality of the Sonny Bono Copyright Term Extension Act (CTEA) against a challenge brought by Eric Eldred, a publisher of public domain works. In 2002, the Supreme Court granted Eldred’s cert. petition. In 2003, in a decision authored by Justice Ruth Bader Ginsburg, the Supreme Court affirmed the D.C. Circuit’s decision by a 7-2 vote. Justices Stevens and Breyer wrote separate dissents.  

Documents in Justice Stevens’ files suggest that initially not enough Justices supported cert., but that Justice Breyer persuaded the Court to take the case. First, Justice Breyer wrote a draft dissenting opinion from a denial of the cert. petition, which he circulated to his colleagues on January 16, 2002. The draft states that the Petitioners’ argument concerning the unconstitutionality of the CTEA “is an important one, implicating the nature of copyright itself.” The draft foreshadows many themes that Justice Breyer later included in his dissenting opinion on the merits. The draft explained that the CTEA “stretches copyright’s term beyond the ‘limited Times’ that the Constitution foresees,” and that the First Amendment “required reading the [Copyright] Clause as imposing a significant temporal restriction.” On this basis, Justice Breyer wrote that he dissented “from the Court’s decision to deny the petition.”

Second, the cover sheet for the case file indicates that initially, only Justice Breyer and Stevens supported cert., with Sandra Day O’Connor voting J-3. Justice Breyer requested that the case be relisted for consideration three times, on January 4, 11, and 18, 2002. On January 16, 2002, Justice O’Connor sent Justice Breyer a letter stating that “I agree with you that we should grant certiorari in this case and change my vote from a ‘join-3’ to a grant.” Presumably she switched her from join-3 to grant after reading Justice Breyer’s draft dissent. But that still wasn’t enough. Ultimately, by the February 19, 2002, conference, Justices Scalia and Souter changed their vote from deny to grant, and the Court granted cert. Although Justices O’Connor, Scalia, and Souter were sufficiently persuaded by Justice Breyer to support cert., they still joined Justice Ginsburg’s opinion affirming the D.C. Circuit.

Justice Stevens’ papers indicate that Section III of Justice Ginsburg’s opinion, which described fair use and the idea expression dichotomy as “built-in First Amendment accommodations,” remained virtually unchanged throughout the eleven drafts she circulated to her colleagues. Thus, the section’s analysis was all Justice Ginsburg’s. The only substantive change to the section was supplied by Justice Thomas. In a December 12, 2002, letter to Justice Ginsburg, Justice Thomas stated that while he agreed with her analysis of the First Amendment question, “we should make clear that the D.C. Circuit’s conclusion that copyright laws are ‘categorically immune’ from First Amendment scrutiny is incorrect.” He then proposed language to implement this point. In a letter to Justice Thomas the following day, Justice Ginsburg said that “you rightly point out that the D.C. Circuit overstated when it declared copyrights ‘categorically immune’ from First Amendment protection.” She added that she would incorporate his suggested language “almost verbatim,” which she did.

MGM v. Grokster

In 2004, the Ninth Circuit found that the peer-to-peer file sharing company Grokster was not contributorily liable for the infringing activity of its users because its software was capable of substantial noninfringing uses, the safe harbor from contributory infringement set forth in Betamax. MGM and other copyright owners petitioned for cert., which the Supreme Court granted. In 2005, the Supreme Court reversed in a unanimous decision. The opinion for Court, written by Justice Souter, adopted an inducement rule, holding that “one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties.” 

Justice Stevens’ file for Grokster is relatively thin. The case file cover sheet indicates that all nine Justices supported the grant of cert. The file contains a fascinating exchange on June 6, 2005, between Justices Scalia and Souter concerning the “inducement” theory Justice Souter articulated in his draft opinion. This exchange is worth reproducing in full to capture how the Justices wrestled both with the analytical coherence and the real-world implications of the decision.

Justice Scalia began the exchange by writing that he could not “go along with the theory of liability” Justice Souter set forth. Justice Scalia first questioned Justice Souter’s terminology. 

Though you put it forward as an aspect of the inducement theory, I think it is not that. The inducement theory requires (as the name suggests) inducement–which is an objective act that can be proven or disproven. Absence of proof of inducement is (as you say) the reason what you call the “classic” theory will not fly here. You then go on to say that the only function of the objective inducement in the classic theory is to show unlawful intent–so if you can prove unlawful intent in some other fashion you are still using, in effect, an inducement theory. I don’t think that follows. 

Justice Scalia then asserted that 

Terminology aside, the problem with the new “wrongful intent” approach is that, since it does not demand the presence of any particular fact, it is dangerously unpredictable. I cannot imagine greater disincentive to technological innovation than the notion that, if a jury finds you had bad intent, you are financially liable. What does wrongful intent consist of? If I launch a new technology that I know for certain will be used 10% of the time for infringement, do I not “intend” that that infringement occur? Or what if I launch a new technology that I know for certain will initially be used 90% of the time for infringement–infringement on which I make a profit that is essential to the start-up of my business–though I expect that percentage to decline rapidly, leaving me ultimately with a profitable, noninfringing, business? Do I not intend that infringement?

In short, I think you may be correct to say that “the function of the message in the theory of inducement is to prove unlawful intent” but it is to prove it through objective action of a specific sort that the innovator can avoid. The same cannot be said of a wrongful-intent theory, which is an open invitation to harassing litigation against innovators.

To eliminate the uncertainty inherent in Justice Souter’s approach, Justice Scalia proposed an alternative rule:

I would tie the decision of this case to specific facts whose existence the innovator can know of and can avoid. I would say that the innovator is liable as a contributory infringer when he launches a new technology (1) whose initial use is overwhelmingly infringing, (2) which infringement is the overwhelming source of the innovator’s profit, and (3) with no realistic prospect that, over time, the infringing use will significantly decline as a source of the innovator’s profit, and (4) the innovator made no reasonable effort to filter out any infringing uses. If a majority of the Court agrees with your new “inducement-without inducement” theory, I will have to write separately.

Justice Souter responded to Justice Scalia’s memorandum by stating that 

I think we are in closer agreement than your recent memo to me would indicate. I agree fully that the theory of inducement set out in my draft must require objective action of a specific sort that the innovator can avoid. In this case, the objective action includes promoting the Morpheus and Grokster software to fill the void for free music left open by Napster to a particular group of computer users known to use file-sharing software for infringement. I further agree with you that knowledge of infringing uses, even to the point of certainty, cannot form the basis for liability or a finding of intentional inducement. I have revised the draft to make this point clearer; originally I’d thought that specific intent based on evidence apart from design and mere distribution would suffice, but you (and Steve [Breyer]) don’t think so. I have also accentuated the positive in highlighting the evidence of actual communication, which is enough to survive summary judgment, even if one places greater emphasis on the fact of a communicated message than I think necessary.

While Justice Souter refined the opinion to address some of Justice Scalia’s concerns, he rejected Justice Scalia’s alternate rule. 

You also suggest that we should craft a rule that makes an innovator liable for overwhelmingly infringing uses unless the infringing uses will likely decline over time or the innovator makes reasonable effort to stop them. I am sympathetic and said so in the conference discussion. After living with this case for a couple of months, however, I believe a test described in those terms would scare the innovators and discourage new work. Copyright holders would not be willing to take the chance that infringing use would decline over time; they would sue the minute they saw third-party infringement on the horizon. I am also afraid the need to show a likely course of declining infringement in the future would guarantee extended litigation of the cases that would be brought early in the course of distributing a new product. I am convinced that the inducement theory provides a much more obvious basis for liability in this case, and also avoids placing courts in the position of making technology policy, such as by deciding what filtering efforts are reasonable or which uses of a technology promise to decline significantly in the future. Courts will get the message to resolve these cases on inducement where they can.

Although Justice Souter rejected Justice Scalia’s alternate rule, he did take

the further step of making explicit one ground on which the Ninth Circuit misread and misapplied Sony. I know that still leaves your “overwhelming infringement” open, but I hope you will be able to join me as far as I go, even if you write separately.

On June 13, 2005, Justice Scalia replied to Justice Souter’s memorandum. 

Your memo persuades me that the existence of overwhelmingly infringing uses plus no prospect of decline is too uncertain a test for innovators. And the changes you have made to the opinion satisfy my other concerns. I would be pleased to join.

The Court issued its decision two weeks later, on June 27, 2005, with all Justices joining Justice Souter’s opinion. Justice Ginsburg wrote a concurring opinion, which Chief Justice Rehnquist and Justice Kennedy joined. Justice Breyer wrote a separate concurring opinion, which Justices Stevens and O’Connor joined. Justice Stevens’ files did not contain any discussion of the two concurring opinions. 

What Influences Decisions

The case file for Grokster also contains a memo that reveals what influences the Court’s decisions, apart from the merits of the case. A memo from a clerk to Justice Stevens on the question of the cert.-worthiness of the case provides this reason, among others, to grant cert.: 

The lawyering in this case is excellent. On petr’s brief alone are Donald Verrilli (Jenner), Kenneth Starr (Kirkland), David Kendall (Williams & Connolly), and others. As I’ve stated above, there is an impressive lineup of amici, many of whom are represented by very high quality counsel, and all of which have concluded that review by this Court is needed to settle an area of law that has been (at least perceptually) unsettled as a result of the decision below. 40 states are urging this Court to grant review. As a result, it seems certain that the argument and the briefing will help this Court reach a well-reasoned decision. 

This indicates that name-brand lawyers might be worth what they charge in cases before the Supreme Court.

Originally posted to the Disruptive Competition Project website. Reposted here with permission.

In early December 2022, a former Israeli Minister of Defense and Chief of Staff of the Israel Defense Forces, three other retired Israeli generals, a former Commissioner of the Israeli Police, and a former head of the Mossad’s Intelligence Directorate filed an amicus brief before the U.S. Supreme Court in Gonzalez v. Google arguing that Internet platforms should be civilly liable for third party content that encourages terrorist activity. In their filing, they claimed that the wave of terror in Israel in 2015–2016 “became known as the ‘Facebook intifada’ and the #stab! Campaign due to the essential role social media played in inciting the perpetrators to attack civilians.” The Anti-Defamation League also filed a brief in the case, similarly arguing that Internet platforms should have legal accountability for violence against Jewish Americans and other vulnerable communities encouraged by these platforms’ recommendation engines. So, too, the Zionist Organization of America asserted that Internet platforms should not be immune from liability “when they target specific users and recommend and direct them to new content that helps fan the flames of hatred and violence against the Jewish community.”

There is no doubt that Internet platforms are used to disseminate antisemitic content. But these briefs fail to recognize that these same platforms greatly foster Jewish community and religious activity in the United States and throughout the Diaspora; and that the legal interpretations these briefs advocate could drastically diminish this activity.

In Gonzalez, the U.S. Supreme Court will consider for the first time the scope of the safe harbor provided by Section 230 of the Communications Decency Act, which limits the liability of an Internet platform for content uploaded by third parties. Since Section 230’s enactment in 1996, the lower courts have interpreted it broadly. Some politicians and interest groups argue that these interpretations are overly broad and have disincentivized Internet companies from eliminating hate speech and disinformation from their sites. Free speech advocates, on the other hand, contend that the courts have correctly applied Section 230 in a manner that enables platforms to allow any speaker to reach a global audience at no, or minimal, cost, without prior vetting or filtering. In Gonzalez, the Supreme Court could uphold the broad interpretation upon which Internet companies have relied for the past quarter century, or it instead could narrow the scope of the safe harbor and disrupt the existing business models of the Open Internet.

Increasing the liability of the platforms for the third-party content would force the platforms to act as gatekeepers; to reduce their exposure to ruinous damages, many platforms would permit dissemination only of paid or pre-approved content. This could adversely affect a wide range of online activity, including the rich Jewish life facilitated by the Internet.

Worship. Even before the Covid-19 pandemic, Jewish congregations had begun to experiment with the live streaming of religious services. Live streaming and video conferencing of services increased dramatically with the onset of the pandemic, and many congregations now use hybrid models. While Orthodox congregations will not stream their services on the Sabbath and the holidays, they will stream the daily morning, afternoon, and evening services. Less strict denominations not concerned about the use of electricity will also stream services on the Sabbath and holidays. (For example, this past Rosh HaShanah, I witnessed the blowing of the shofar at B’nai Jeshuran Congregation in New York from my hotel room in Geneva, Switzerland.) Indeed, the use of video conferencing and streaming technologies have led to extensive rabbinic debate whether people participating in a service via Zoom counted towards the “minyan” or quorum of ten participants. The Rabbinical Assembly of the Conservative Movement issued a 50-page legal opinion on the subject.

The availability of remote attendance has led to growing participation in daily services and the strengthening of ties to Judaism. One now can routinely join shiva minyans at the houses of mourners via Zoom or other video-conferencing platforms, enabling mourners to be joined by family and around the world. The same is true with other life-cycle events, such as brises (ritual circumcisions) and weddings.

Education. Internet platforms provide myriad channels for formal and informal Jewish education. During the pandemic, Jewish institutions of learning at all levels migrated online using platforms such as Zoom or Webex. Adult education programs on Jewish topics by synagogues, universities, and other organizations are now offered online. Lectures are live streamed and archived on YouTube. Hundreds of rabbis from around the world offer “daf yomi” or the daily study of a page of Talmud via Internet platforms.

Culture and Community-Engagement. Social media platforms such as YouTube host vast quantities of Jewish cultural material, including videos of performances of songs and dances. Around holidays, groups such as Six13 and the Maccabeats release their latest holiday-themed recordings. Synagogues and other Jewish organizations use platforms like Facebook and Zoom for cultural events, book groups and professional discussion forums for rabbis, cantors, and teachers. Hadassah Magazine in an article entitled A (Facebook) Group for Every Jewish Interest reviewed some of the over 1,000 Facebook groups with “Jewish” or “Jews” in their names.

In short, Internet platforms allow Jews in the Diaspora to practice their faith and strengthen their identity. Moreover, U.S.-based platforms heavily support all aspects of political, economic, cultural, and personal life in Israel. Indeed, Israelis are the world leaders in social media use, with 77 percent of adults using social platforms such as Facebook, Instagram, and WhatsApp. Imposing greater liability on U.S. platforms for third party content could endanger these positive uses by increasing their cost and reducing their spontaneity.

Proponents of narrowing the Section 230 safe harbor, including the generals and organizations mentioned above, may contend that rather than wholesale changes to the application of Section 230, they merely want increased liability for the use of algorithms recommending content. But virtually all social media sites use recommendation algorithms; the amount of content available on the Internet is so enormous that all search engines and sites hosting content use algorithms to determine what content to offer users.

The Solicitor General of the United States in its brief in the Gonzalez case tried to draw a distinction between the use of algorithms by search engines to select content in response to a user’s query and the use of algorithms by a social media platform to supply a user with content by an automatically generated feed. This is a distinction without a difference. The search engine algorithm considers searches the user has previously conducted in determining what search results to present the user in response to the particular query he is now making; the platform considers the user’s prior activity in determining what content to present the user in her feed. In both cases, the user’s prior activity influences the algorithm.

Furthermore, even if there were a difference between search engine results and feeds, feeds are extremely beneficial to the user and society at large in most cases. The feed provides the user with more of the content she wants to see, and usually that content is not problematic in any way. To be sure, a social media platform might feed additional antisemitic content to a user who spends some time on the platform viewing antisemitic content. By the same token, the platform would feed Jewish educational material to a user who spends time on the platform viewing Jewish educational material. Platforms should not be forced to abandon feeds, with all the resulting user benefits, because on occasion the feeds may have harmful impacts.

Finally, three quick responses to the suggestion that platforms could easily remove access to antisemitic content without changing their business models in a manner that ultimately restricts access to legitimate content. First, display of antisemitic symbols and content might be necessary for educational purposes, such as to teach about the Holocaust — but Internet companies have difficulty accurately making such content moderation distinctions, particularly at scale. Second, there is profound disagreement about when criticism of Israeli government policies towards the West Bank and Gaza Strip constitutes antisemitism. Here, too, Internet companies have trouble getting the nuance right. Third, even if the social media platforms could draw appropriate lines with respect to antisemitic material, changes to Section 230 would still lead to liability for other problematic content, and the platforms would still need to change their business models, to the detriment of Jewish activity online.

A decision in the Gonzalez case is expected by the end of June 2023.

Jonathan Band is a copyright and internet lawyer based in Maryland. This article was reposted with permission.

Many observers, including me, predicted that the 2014 decision of the U.S. Court of Appeals for the Federal Circuit (?CAFC?) in Oracle America v. Google would provoke a new wave of litigation concerning copyright and interoperability. In particular, we worried that the decision would encourage dominant vendors to bring copyright claims against competitors that replicated interface specifications for the purpose of interoperating with the dominant vendors? products. We were right.

Sure enough, Oracle America has factored into at least four cases so far. One of these cases settled, one is on appeal, and the other two likely will be appealed in the near future. The latter two cases also involve patent claims, so appeals will be heard by the CAFC. (The CAFC has nearly exclusive appellate jurisdiction over cases with patent claims.) One can assume that the plaintiffs added the patent claims to ensure CAFC jurisdiction.

GDC v. Dolby Laboratories

This is the case that settled. Dolby Laboratories provides advanced motion picture theatre sound systems. GDC Technology develops software and hardware that interoperates with the Dolby systems. Dolby facilitated this interoperability by making its interface specifications available to GDC. It appears that Dolby stopped providing this information after it acquired Doremi, a media server manufacturer. Evidently, this acquisition made GDC a more direct competitor. Emboldened by the CAFC?s Oracle America decision, Dolby demanded that GDC stop using Dolby interface specifications to interoperate with Dolby products. Furthermore, Dolby insisted that GDC cease telling customers that GDC had the right to use this interfaces information to interoperate with Dolby products.

Dolby?s conduct prompted GDC in April 2016 to bring a declaratory judgment action in federal court in California against Dolby Laboratories seeking a declaration that Dolby does not own a copyright in the ?protocols and interconnection codes? Dolby developed for digital cinema systems. In the alternative, GDC sought a declaration that fair use permitted it to use the specifications for the purpose of achieving interoperability. The parties settled the dispute in November 2016. According to the joint press release, ?as part of the resolution, GDC will dismiss its lawsuit against Dolby, and GDC and Dolby will grant each other licenses that will allow their respective theater management systems to interoperate with the other party?s digital cinema servers.? The other terms of the settlement agreement were not made public.

SAS Institute v. World Programming

This case currently is on appeal to the Fourth Circuit, and has the most complex procedural history. The district court ruled that the input and output formats the defendant copied were not protectable under copyright, but found that the defendant breached license restrictions on reverse engineering. A jury subsequently assessed damages of $26 million, which the court then trebled to $79 million under North Carolina?s unfair trade statute.

SAS, a company based in North Carolina, creates an integrated suite of business software products known as the SAS System. The SAS System allows users to perform a variety of data access, management, analysis, and presentation tasks. The SAS System can run on various kinds of computers ranging from PCs to mainframes. Users can perform tasks on the SAS System by writing programs in the SAS Language. Additionally, SAS developed a version of the SAS System called SAS Learning Edition to help users learn how to program in the SAS Language.

World Programming Limited (?WPL?), a U.K. company, developed World Programming System (?WPS?), which can run SAS Language programs and produce similar outputs. Thus, WPL provides users with a competing platform on which they can run the programs they have written in the SAS Language, thereby avoiding being locked-in to the SAS environment.

To develop WPS, WPL reverse engineered copies of the SAS Learning Edition. However, the license under which WPL obtained SAS Learning Edition prohibited reverse engineering of the software. It appears that WPL?s development activities occurred in the U.K., but it distributed its software in the United States.

SAS sued WPL in the U.K. in 2009 and in the U.S. in 2010. The U.K. case proceeded more quickly. The U.K. High Court requested guidance from the highest court in the European Union, the Court of Justice of the European Union (?CJEU?), on whether software functionality, programming languages, and data formats were protectable under the EU Software Directive. The CJEU ruled in 2012 that these elements were not protectable. On the basis of this ruling, the U.K. court entered final judgment for WPL in 2013.

In April 2014, WPL moved for summary judgment in the U.S. action in North Carolina, arguing that the U.K. judgment had preclusive effect on many issues under theories of comity and collateral estoppel. In other words, WPL argued that SAS couldn?t re-litigate in the United States what it had already lost in Europe.

The district court ruled on the summary judgment motion in October 2014. The district court held that it was not bound by the U.K. court?s conclusion that the EU Software Directive rendered unenforceable the SAS Learning Edition license terms restricting reverse engineering. This is because the district court found that North Carolina law differed significantly from EU law on the question of the validity of the contractual provisions prohibiting reverse engineering. Thus, the district court granted summary judgment to SAS on its breach of contract claim.

With respect to SAS?s copyright infringement claim, the district court refused to give preclusive effect to the U.K court?s ruling that copyright did not protect the program elements WPL copied on the ground that WPL failed to demonstrate the similarity of U.S. and U.K. law on this issue. This is a questionable ruling. The U.K. court and the CJEU based their decisions on the Software Directive?s articulation of the idea/expression dichotomy. The idea/expression dichotomy is a fundamental principle of copyright law worldwide, including U.S. copyright law. Therefore, there is no reason to conclude that a program element the CJEU considers to be unprotectable under Article 1(2) of the Software Directive also is not protectable under section 102(b) of the U.S. Copyright Act.

Despite refusing to grant preclusive effect to the U.K. court?s determination that WPL?s copying did not infringe, the district court ultimately reached the same conclusion based on its own analysis of U.S. copyright law. It was undisputed that WPL had no access to SAS?s source code, and thus WPL did not copy any SAS code, nor the structure, sequence, and organization of that code. Instead, SAS based its copyright claim on WPL?s copying of the SAS System?s input and output formats. The district court rejected the claim, reasoning that SAS in essence was ?asking the court to find that defendant?s software infringes its copyright through its processing of elements of the SAS Language?.? This meant that ?plaintiff seeks to copyright the idea of a program which interprets and compiles the SAS Language?.? The court refused to allow such broad protection.

SAS resisted the conclusion that WPL did not copy protected expression by arguing that ?this case is on all fours? with Oracle America. The court rejected this argument. The court noted that in Oracle America, Google had copied strings of Java code. Here, by contrast, ?there is no evidence that defendant has copied specific strings of SAS language, or specific strings of source code for plaintiff?s software, only that its software can function with these SAS Language elements.?

A trial was held on damages for WPL?s breach of the SAS Learning Edition license; fraudulent inducement in obtaining the Learning Edition; and violation of North Carolina?s Unfair and Deceptive Trade Practices Act (?UDTPA?). In 2015, the jury found SAS was damaged by WPL?s breach of the license in the amount of $26 million; WPL fraudulently induced SAS to enter into the license agreement; and WPL?s conduct violated the UDTPA. On account of the violation of the UDTPA, the district court trebled the actual damages to a total of $79 million.

WPL and SAS cross-appealed. Because SAS did not bring any patent infringement claims, the appeal will be heard by the Fourth Circuit rather than the CAFC. SAS and its amici, Mathworks and the Business Software Alliance, have recently filed briefs. In their briefs, SAS and its amici completely ignore what the copyright aspect of this case is really about: whether copyright enables SAS to lock its users into the SAS System after they have invested millions of dollars writing their own programs in the SAS Language.

Synopsys v. ATopTech

In our third case following Oracle America, a jury in California found that the defendant infringed the command set in the plaintiff?s software. Because the case also involves patent claims, the CAFC will hear the appeal of this dispute as well.

Both Synopsys and ATopTech develop software for the ?place-and-route? function in the design of computer chips, i.e., software that plans the layout of a chip and the electrical connections among its various components. Synopsys also produces ?sign-off? or ?static timing analysis? software, which checks the timing of the chip design created by the place-and-route software.

Synopsys claimed in federal court in California that ATopTech had copied into ATopTech?s place-and-route product, Aprisa, part of the command set from Synopsys?s sign-off product, PrimeTime. Command sets include the names and syntax of commands, options, parameters, variables, objects, and attributes. ATopTech filed a motion for summary judgment that it did not copy protectable expression, but the court in a terse ruling found that Synopsys ?raised a triable issue? as to whether the copied elements were expressive. Similarly, the court found there were triable issues relating to ATopTech?s merger and fair use defenses. After trial in March 2016, the jury found that ATopTech infringed Synopsys?s copyright in its command set, and awarded Synopsys $30 million in damages.

The court then conducted a bench trial on ATopTech?s equitable estoppel defense. ATopTech argued that Synopsys encouraged its usage of the command set ?in order to meet customer demand for improved interoperability between place-and-route and sign-off products when the two types of products are offered by different vendors.? The court denied the defense, finding that there was no evidence that Synopsys had actual or constructive knowledge that ATopTech had copied the command set. The court also rejected ATopTech?s assertion that Synopsys by its conduct misled ATopTech to believe that it would not assert its copyright in its command set.

As noted above, Synopsys brought patent infringement claims against ATopTech in addition to its copyright claims. This means that any appeal in this case will also be heard by the CAFC.

Cisco v. Arista

In our last post-Oracle America case, a jury in California recently found that the Cisco command line interfaces copied by Arista were not protected by copyright under the scenes a faire doctrine. Because Cisco also brought patent claims against Arista, the CAFC will hear this appeal as well.

Arista Networks develops switches and other network products that compete with the market leader, Cisco Systems. In 2014, after the CAFC?s decision in Oracle America, Cisco sued Arista for allegedly copying 500 of Cisco?s command line interface (CLI) commands when developing its EOS network operating system. The CLI is the primary mechanism for network engineers to interact with switches and routers in which Cisco operating systems are installed. The 500 commands consist of two, three, or four words reflecting multi-level textual hierarchies. Before trial, the district court ruled that four ?building blocks? of the CLI (the multiword command line expressions, modes and prompts, command responses, and help descriptions) could be protected as a compilation, and left it to the jury to consider whether merger or scenes a faire rendered Arista?s copying noninfringing. The court further ruled that because the individual elements of each of these building blocks were not protectable, the compilations were entitled only to thin protection. Under Ninth Circuit precedent, this meant that infringement could be found only if there was virtually identical copying.

At trial, Arista?s lawyers — who also represented Google in its litigation with Oracle America — argued that the CLI was an industry standard Cisco encouraged others to use. Arista raised three defenses: merger, scenes a faire, and fair use. In December 2016, the jury rejected the merger and fair use defenses, but agreed that Arista?s use did not infringe under the scenes a faire doctrine. Under the scenes a faire doctrine, courts deny protection to expression that is standard, stock or common to a particular topic or that necessarily follow from a common theme or setting. Granting copyright protection to the necessary incidents of an idea would effectively afford a monopoly to the first programmer to express those ideas.

As noted above, any appeals in the case will be heard by the CAFC because Cisco?s complaint also alleged patent infringement (a claim the jury rejected).

Of the three cases that did not settle, two will be appealed to the CAFC. Given the random nature of judicial assignments, there is a good chance these appeals will be heard by different panels from that in Oracle America. Hopefully these panels will not feel too constrained by the Oracle America opinion. After all, CAFC panels often disagree with one another in patent cases.

(These cases, and the Oracle America decision, are discussed in greater detail in my book Interfaces on Trial 3.0: Oracle America v. Google and Beyond.)

Republished from the Disruptive Competition Project

What does Leonard Nimoy’s “Vulcan salute” have to do with European newspaper headlines? They both might one day be regulated by new international intellectual property rules, if some have their way. One might think that what constitutes “intellectual property” is set in stone, but it isn’t.  Around the world, different interests are lobbying for governments to create new types of intellectual property all the time.

As DisCo has covered before, news publishers in Europe and elsewhere are currently pushing for the creation of new IP rights in newspaper headlines, so that online sites can be forced to pay for the privilege of quoting or linking to news coverage. Spain and Germany have already created these rights, and there is pressure in Brussels for a pan-European rule.

At the same time, for more than a decade there have been efforts within the World Intellectual Property Organization to create rights in “traditional cultural expression” (which, as explained below, may include the hand gesture on which Leonard Nimoy based the Vulcan salute). Some indigenous communities are distressed about the commercial exploitation of their folklore and other forms of cultural expression by “outside” entities. In a desire to (a) prevent uses that they believe are disparaging and (b) regain control over an important part of their identity, these communities have lobbied for a treaty that would require the creation of intellectual property rights in “traditional cultural expression.”

Concerns have been raised about the scope of the draft treaty. If adopted in its current form, critics say, the treaty could interfere with cultural life around the world, pulling out of the public domain material that is incorporated in countless novels, paintings, films, sculptures, operas, and other musical compositions. This is because these works are based on stories, legends, dances, rituals and other forms of expression that the treaty could protect without a limitation on term.

How does this relate to Leonard Nimoy’s Vulcan salute? The famous actor’s death last week provoked extensive discussion of his contribution to popular culture, including the famous Vulcan salute used by his character Spock in the Star Trek television series and movies. The Vulcan salute (hand raised with the palm forward and the thumb extended, while parting the fingers between the middle and ring finger) could violate the exclusive rights that a treaty on traditional culture expression would create. This is because Nimoy, according to his autobiography, based the Vulcan salute on the hand gestures in the priestly blessings he saw in synagogue as a child.

The priestly blessing is an elaborate ritual performed during the Jewish worship service by men who believe they are descendants of Aaron, the High Priest and Moses’s brother. These men are referred to as Kohanim (Hebrew for “priests”). At the beginning of the ritual, the hands of the Kohanim are washed by the descendants of the tribe of Levi, the Levi’im. The Kohanim then remove their shoes and stand up in front of the congregation. They cover their heads with their prayer shawls, turn towards the congregation, and raise their hands (underneath the shawls) in what is now popularly referred to as the Vulcan salute. With the fingers and thumbs spread in this manner, each hand looks like the Hebrew letter shin, which is the first letter of the word “Shaddai,” a name for God. The Kohanim then recite the words of the priestly blessing set forth in the book of Numbers: “May the Lord bless you and guard you; may the Lord make His face shed light upon you and be gracious to you; may the Lord lift up His face to you and give you peace.” (If the words sound familiar, that’s because the song “Sabbath Prayer” in Fiddler on the Roof is based on them. It’s also Solemn Blessing #10 in the Roman Missal used by Catholics.)

Although the words of the priestly blessing derive from the Old Testament, and thus are over 2,500 years old, the hand gesture probably developed later. It is described in the Shulchan Aruch (Hebrew for “Set Table”), a codification of Jewish law first published in 1565, thus indicating that it was in wide use 450 years ago. Currently, the priestly blessing is conducted daily in traditional Sephardic congregations, and on holidays in traditional Ashkenazic congregations.

Although no one seems to have objected to Nimoy’s adaptation of the gesture for his Vulcan character, the hand gesture of the priestly blessing may nevertheless fall within the scope of the draft treaty. Traditional cultural expression includes actions such as ceremonies and rituals. The treaty’s protection would extend to the traditional cultural expression created, expressed, and maintained, in a collective context, by the treaty’s beneficiaries. The class of beneficiaries remains in flux. The treaty refers to “indigenous peoples” and “local communities and nations” without defining any of these terms. These terms may encompass traditional Jewish communities. Moreover, the treaty appears to allow national law to determine which communities are beneficiaries. One could easily imagine Jewish communities in some countries (e.g., Israel and the United States) successfully lobbying for the treaty’s protection.

Under the treaty, the rights in the traditional cultural expression would be collectively administered by a “competent authority” for the benefit of the members of the beneficiary community. The competent authority would have the authority to license the use of traditional cultural expression and distribute any resulting compensation. Although Nimoy was Jewish, it is unlikely that the treaty would have permitted him to use the hand gesture in a non-traditional way such as the Vulcan salute in Star Trek without the approval of the competent authority. And the treaty certainly would not have permitted the unauthorized use of the hand gesture by any Vulcans played by non-Jewish actors. The current draft of the treaty does not include a grandfather clause, so if the treaty were adopted in the future, the competent authority in each country would be able to prevent the further dissemination of existing Star Trek works containing the Vulcan salute, as well as the use of the salute in future films.

Folktales permeate modern Western culture, from Disney films to Lord of the Rings to the Twilight series to Wagner’s Ring of Nibelung to Tchaikovsky’s Swan Lake. Thus, it is no surprise that the treaty on traditional cultural expression has little support among the developed countries and WIPO is unlikely to adopt it soon, if ever. But this just highlights the fact that what receives intellectual property protection is a policy choice, rather than a reflection of natural law. As a result, types of protection vary across countries. For example, the “ancillary rights” that restrict newspaper snippets in Europe have received no traction in the United States. Similarly, Congress rejected the attempt by large publishers to import the EU Database Directive’s protection for non-original databases a decade ago. This policy decision has allowed U.S. researchers to engage in enormously productive text and data-mining, which the Database Directive prevents their colleagues in the EU from performing.

Just as policymakers were confronted with a choice over creating database rights, they may one day be presented with a similar choice about news snippets, or hand gestures, and the choices they make could have a considerable effect on culture and communication worldwide.

Republished from the Disruptive Competition Project

Jon Stewart’s announcement on February 10 that he will be retiring from The Daily Show later this year has been met with tributes to his comic genius and his impact on political discourse. But these tributes have overlooked the legal doctrine that has enabled Stewart to be so effective: fair use. (This is my second post this week about the importance of fair use to popular culture; on Tuesday I wrote about how the Fifty Shades of Grey trilogy was first written as fair use-dependent fan fiction based on the Twilight vampire series.)

Stewart’s most powerful critiques result from his juxtaposing clips of politicians and commentators on news broadcasts to demonstrate their hypocrisy. He’ll contrast a clip of a Fox News commentator expressing outrage at President Obama taking a particular action with a clip of the same commentator praising President Bush for taking a similar same action. Stewart also uses montages of clips from CNN and other news networks to demonstrate their simultaneously sensationalistic and superficial coverage of disasters and trials. But for fair use, Stewart’s rebroadcast of these clips would be willful copyright infringement, subject to statutory damages of up to $150,000 per clip.

Jon Stewart’s heavy use of clips for the purpose of humorous political criticism has inspired other comedians to emulate him, most notably his former “correspondents” Stephen Colbert on The Colbert Report and John Oliver on Last Week Tonight. Stewart’s reliance on clips no doubt has also encouraged the growth of the remix culture online, where individuals combine clips of preexisting works for the purpose of political or artistic expression.

Stewart’s reliance on fair use likely made him progressive on other copyright matters. He supported fans distributing excerpts of The Daily Show online, he questioned the position of Viacom (the owner of Comedy Central, the channel that carries The Daily Show) in its litigation with YouTube, and he opposed SOPA.

Additionally, Jon Stewart’s fair use of clips has had a positive impact on policymakers. The Daily Show is perhaps the easiest example to give lawmakers and their staffs of the importance of fair use. A reference to The Daily Show makes them instantly understand how fair use functions, in Supreme Court Justice Ruth Bader Ginsburg’s words, as one of the copyright law’s built-in accommodations to the First Amendment. Further, The Daily Show demonstrates clearly that large media companies (e.g., Viacom) rely on fair use.

Jon Stewart has not announced what he will do after he leaves The Daily Show. But it is hard to imagine that the greatest practitioner of fair use in this generation will not at some point embark on another venture that employs fair use.

Reposted from the Disruptive Competition Project

Fifty Shades of Grey, which is being released this Friday just in time for Valentine’s Day, is sure to be one of the top grossing films of the year. Depending on your point of view, fair use is to blame?or thank?for the existence of the Fifty Shades franchise.

The movie is based on the three erotic Fifty Shades novels, which have dominated (pun intended) book sales for the past three years. Over 100 million copies of the novels have been sold, the first novel of the series has been on the New York Times bestseller list for 140 weeks, and the novels have been translated into 51 languages. And to make sure that no dollar is left behind, Target just began distributing a line of Fifty Shades sex toys to coincide with the film’s release. Similarly, Vermont Teddy Bear is offering a Fifty Shades of Grey Teddy Bear, featuring smoldering eyes, a suit and satin tie, a mask, and mini handcuffs.

The British author of the series, E.L. James (a pseudonym for television executive Erika Mitchell), originally wrote the trilogy as fan fiction of Stephanie Meyer’s popular Twilight series, and posted it in installments on the fan fiction site FanFiction.net under the title Master of the Universe. Some of the readers complained that it was too racy for the site, which tries not to host adult content, so James moved it to a website she created, FiftyShades.com. At some point the popularity of the story must have convinced James of its potential commercial value, so she eliminated the potentially infringing references to Twilight characters and plotlines while retaining her original bondage/discipline, dominance/submission, and sadism/masochism themes. She divided this revised version into three novels that were published as e-books by an Australian virtual publisher.

Fan fiction is a quintessential fair use. It is highly transformative and does not harm the market for the original work. To the contrary, by allowing fans to engage and interact with the works they admire, fan fiction enhances fan loyalty and likely increases sales. For this reason, the vast majority of authors and media companies do not object to non-commercial fan fiction. (The little litigation involving fan fiction has arisen in circumstances when a commercial publisher distributed what started as fan fiction, e.g., the Harry Potter Lexicon.)

It is unclear whether fair dealing, the UK version of fair use, permits fan fiction to the same degree as fair use. The copyright laws of other European countries likewise do not contain exceptions sufficiently robust to provide certainty about the legality of fan fiction. For this reason, the world’s largest fan fiction websites are based in the United States. Thus, FanFiction.net, the website on which E.L. James first posted Master of the Universe, was established in California in 1998. Fan fiction websites, like search engines and social media platforms, are examples of how fair use has enabled the global leadership of U.S. Internet companies.

Fair use and the fan fiction culture it enables nurtured the development of Fifty Shades. As she uploaded chapter after chapter of Master of the Universe, James almost certainly would have received constructive comments from other fans of “Twific” (Twilight fan fiction) recommending stylistic changes and plot twists, and urging her to continue writing. The fan fiction environment provided James with a platform for road-testing her work, and developing a following, without incurring infringement liability.

The creative cycle continues. Thousands of “fanfics” inspired by Fifty Shades are now available on FanFiction.net and other fan fiction websites. Perhaps some day one of them will evolve into a bestselling novel or a major motion picture.

Reposted from the Disruptive Competition Project

Among the most powerful moments of Selma, the new film about the march Martin Luther King, Jr. led in 1965 in support of voting rights for African Americans, are the speeches, sermons, and eulogies King delivered during that tumultuous period. However, the speeches performed by actor David Oyelowo in the film do not contain the actual words spoken by King. This is because the King estate would not license the copyright in the speeches to filmmaker Ava DuVernay. Thus, the King estate’s aggressive stance on copyright has literally forced the re-writing of history.

According to the Washington Post, the King estate licensed the film rights to King’s speeches to DreamWorks, with Steven Spielberg producing any resulting films. DuVernay said that she never even asked for the rights to King’s speeches “because we knew those rights are already gone, they’re with Spielberg.” She added that she knew that there were strings attached to the rights: “with those rights came a certain collaboration.” In other words, the King estate uses its control over the copyright to control how King is portrayed. The Post article suggests that this control has prevented the making of a feature film about King?until now.

In the summer of 2013, when the nation was commemorating the 50^th anniversary of the March on Washington, the King estate refused to allow broadcasts of King’s “I Have a Dream” speech. At the time, I wrote a blog post questioning the policy justification for one of the most important speeches in American history remaining under copyright 50 years after its delivery, and 45 years after the death of its author. I argued that King did not need the economic incentive provided by copyright protection to write the speech or deliver it so compellingly. I further asserted that copyright protection was not necessary to ensure that the speech remained in distribution 50 years after the March on Washington. I also responded to the argument that royalties from King’s speech have financed the work of the Martin Luther King Jr. Foundation promoting civil rights and social justice by noting that funding valuable institutions is not the purpose of copyright. Additionally, the cause of civil rights arguably could be better advanced by the broadest possible dissemination of his speech, rather than by exploiting it to generate revenue for the Foundation.

The same arguments can be made with respect to King’s speeches surrounding the march in Selma. King obviously was not motivated by financial gain when he wrote those speeches. Further, copyright protection was not necessary to ensure that the speeches remained available in the decades since. To the contrary, copyright protection prevented the derivative use of those speeches in the film, thereby potentially depriving new audiences of King’s message.

The Washington Post‘s review of Selma suggests that the director Ava DuVernay made a virtue of necessity in response to her inability to secure the rights to the speeches:

“in a brilliant work-around DuVernay approximates [King’s] words, allowing viewers to focus on their meaning rather than how literally Oyelowo reproduces them.” Likewise, the New York Times’ review observes that DuVernay turned her lack of permission to use the speeches into “a chance to see and hear [King] afresh.” In the film, King is “less an orator than an organizer” and is “a man trying to navigate his public role, his private life, and the expectations of his allies and friends.”

Proponents of long copyright term might point to these reviews as proof of the copyright system working properly. Denied the ability to quote King directly, DuVernay was forced to create her own expression?paraphrases of King’s speeches?and her own interpretation of King’s life.

At the same time, the Times recognizes that the inability to quote King directly “may be a blow to the film’s authenticity.” And this is a serious problem, particularly in a world where people are far more likely to learn history from a biopic than from a textbook. The director of a biopic already must compress complex events that unfolded over months (in the case of Selma) or years (in the case of the Alan Turing biopic, The Imitation Game) into two hours. The director must also add dramatic tension in order to sustain audience interest. (For example, Joe Califano, then a member of the Johnson Administration, has accused DuVernay of falsely portraying a series of conflicts between Johnson and King over voting rights, when in fact they agreed with the both the strategy and the tactics for achieving this objective.) The inaccuracies created by this compression and invented dramatic tension should not be compounded by concerns of potential copyright infringement liability.

Fair use is the obvious solution to the problem of copyright constraining the presentation of historical events. In Bouchat v. Baltimore Ravens, discussed in this post, the Fourth Circuit found the National Football League’s use of the “Flying B” logo in highlight films to be transformative because the logo was used “as part of the historical record to tell stories of past drafts, major events in Ravens history, and player careers.”

The court further stated:

“Were we to require those wishing to produce films and documentaries to receive permission from copyright holders for fleeting factual uses of their works, we would allow those copyright holders to exert enormous influence over new depictions of historical subjects and events. Such a rule would encourage bargaining over the depiction of history by granting copyright holders substantial leverage over select historical facts.”

Similarly, in Fox News Network v. TVEyes, discussed in this post, the court concluded that TVEyes’ inclusion of clips in a search engine for broadcast television was a transformative use. The court found that “TVEyes’ message, ?this is what they said’?is a very different message from Fox News’??this is what you should know or believe.'”

The primary purpose of including King’s speeches in the film Selma would be to inform its viewers of what King said and the impact it had on his audience. Although Ava DuVernay almost certainly believed in what King said, and wanted her viewers to believe it too, that purpose would be secondary to educating her viewers about King and his impact on the course of history.

Based on TVEyes and Bouchat, DuVernay would have had a strong fair use defense had she used King’s actual words rather than just paraphrased them. Perhaps she (or her lawyers) decided that historical accuracy was not worth the risk of litigation with the King estate. While it appears that DuVernay remained true to both the style and content of King’s speeches, the next director might not be so scrupulous. Indeed, an inept paraphrase of one of King’s speeches at the Martin Luther King, Jr. Memorial in Washington, D.C., made him sound, according to Maya Angelou, “like an arrogant twit.” The paraphrase subsequently was removed.

The paraphrasing of Martin Luther King, Jr. puts us on the slippery slope to truthiness. The King estate should be far more worried about people paraphrasing King than quoting him accurately.

Reposted from the Disruptive Competition Project