SOPA Status

It’s been a consequential week for the Stop Online Piracy Act (SOPA) and the Protect IP Act, the two controversial pieces of copyright-protected legislation pending in Congress. I’ve posted about these bills in recent months but I’ve not attempted to post the play-by-play culminating in last week’s coordinated online protest against the bills. Now that the bills have stalled–the New York Times reports “the pressures of an election year make action this year unlikely”–over the next few days I want to take time to compare the bills’ stated purposes with their methods for achieving those purposes, and separate fact and myth from arguments of both the bills’ proponents and its opponents. These particular bills may be gone for good but the issues they address and, as important, the music, motion picture, and publishing industry lobbying effort that pushed for their creation are still patrolling the House and Senate.

Monetizing Piracy

An Ars Technica story provides more information about the U.S Copyright Group’s litigation campaign against movie downloaders.  As mentioned here in March (see Bit Torrent-ers Beware) the Group is the revenue-generating brainchild of a Virgina law firm.  As reported by Ars Technica it’s a simple idea:  identify downloads of an independent film, team up with film’s producers, sue the anonymous John Does for copyright infringement, subpoena their identities, agree to settle for short money (compared to going to trial), split the proceeds with the film’s producers, rinse, repeat.  Ars Technica identifies the films and number of defendants named in the eight suits, all filed since January 2010 in D.C. federal court ; The Hurt Locker is the best-known.  U.S. Copyright Group has sued over 14,800 defendants to date.  If the plaintiffs obtained an average of just $500 per defendant (a number I pulled out of the thin air) they would gross $7.4 million.  From where I sit $500 per defendant seems plausible–some John Does will remain unidentified, some won’t exist, some will be judgment-proof, but even so an average of $500 per defendant is not a ridiculous plug number.  Whether the lawyers’ costs come off the top or not, and even if the costs are $100/defendant, the net would be about $6 million.  Ars Technica plugs in larger numbers to calculate a settlement pot of close to $20 million.  Whoever is closer, it’s real money.

BitTorrent-ers Beware

The title to Eriq Gardner’s article states its content efficiently:  New Litigation Campaign Quietly Downloads Tens of Thousands of Movie Downloaders.  The U.S. Copyright Group–“a company owned by intellectual property lawyers that has one singular mission and focus: to stop movie copyright infringement and make illegal downloaders pay damages for the content they have stolen”–, using “a new proprietary technology by German-based Guardaley IT that allows for real-time monitoring of movie downloads on torrents,” has filed five lawsuits against a total of 20,000 [20,ooo !!!] individuals in federal court in Washington, D.C.   The Group is planning to file another suit targeting 30,000 individual downloaders.  Gardner’s article reports that some of the suits have settled, but the U.S. Copyright Group does not appear to be aiming for the $3-$5k settlements typical to RIAA file-sharing lawsuits.  Said the Group’s Jeffrey Weaver “”We’re creating a revenue stream and monetizing the equivalent of an alternative distribution channel.”

$.70 a Song

Joel Tenenbaum, BU’s own music pirate found liable last summer for copyright infringement in a case that attracted considerable media attention, is in the news again.  A federal court jury ordered Tenenbaum to pay $675,000 in damages to copyright holders for downloading 30 songs.  That’s $22,500 a song.   Tenenbaum’s pro bono lawyer Charlie Nesson argued yesterday to trial judge Nancy Gertner that the appropriate measure of damages would be the revenue lost because Tenenbaum didn’t purchase the songs from iTunes.  At the iTunes price of $.99 a song, assuming iTunes would pay the rights holder the standard 70% of the sale price, Nesson said the total damages should be no more than $21. The Boston Globe article about the hearing does not mention whether Gertner, plaintiffs’ counsel, the court clerk, the bailiffs, and the courtroom’s audience burst into laughter mention of Nesson’s damage figure.  There had to be considerable eye-rolling.  Many commentators, including me, have been critical of Nesson’s handling of this case (see prior posts).  Today he earns kudos for passing the straight-face test. The record companies’ lawyers response was that Tenebaum “has no one to blame but himself.”

Nesson’s strategy may prove to be a wily gamble.  Gertner’s 2009 order explaining her decision not to allow Tenenbaum’s fair use defense signaled in very clear terms her discomfort with the state of the law regarding file-sharing.  Gertner is very smart and not afraid to take a fresh look at this case.  Nesson’s $.70-a-song argument is calculatedly ridiculous.  Nesson did not cover himself with legal glory before and during Tenenbaum’s trial, but he is very smart.  By staking out such an extreme position he leaves Gertner plenty of room to maneuver.

Recently, in Internet law . . .

Here’s the First Commandment for the Study of Internet Law:  What the Internet was is not what the Internet shall always be.  A few more stories echoing the last post’s theme:

  • France’s Constitutional Council rejected the legislature’s attempt to thwart digital piracy by terminating Internet access for alleged illegal downloaders.  Under the legislative proposal “a newly created agency, acting on the recommendations of copyright owners, would have been able to order Internet service providers to shut down the accounts of copyright cheats who ignored two warnings to stop.”  The Council held the proposal violated French constitutional principles including the presumption of innocence and freedom of speech.
  • The on-again, off-again Italian trial of four Google executives on criminal defamation and privacy charges arising from Google’s failure to remove a YouTube video of the bullying of an autistic boy in Turin started again this week–and then stopped after one day, when a translator failed to appear.  The prosecution claims “that Google should have acted to prevent the broadcast of the footage and that by failing to do so it breached the disabled boy’s privacy.”  Google, in turn, claims it has no legal liability to monitor content posted by third-parties and that “seeking to hold neutral platforms liable for content posted on them is a direct attack on a free, open internet.”  The charges, which carry potential prison terms of three years, underscore the profound difference between U.S. and European Union privacy law and the importance of ISP liability immunity provided by Section 230 of the Communications Decency Act.
  • NetChoice published its Internet Advocates Watchlist for Ugly Laws–“iAwful” to publicize “ the top ten worst proposed laws affecting ecommerce and open communications. . . . [The list’s] primary focus is on laws that will affect business, particularly by increasing taxes or dictating standards and practices that the group thinks are unworkable.”

Piracy Postscript

Yesterday France rejected the piracy-surveillance system mentioned in the previous post.  The bill, refined after weeks of discussion in the National Assembly, was expected to pass.  Its supporters were apparently so confident of its enactment that they didn’t go out of their way to appear for the vote.  Their complacency resulted in the bill’s defeat 21-15, thanks to Socialists who opposed the bill from the outset.

Piracy on Parade

To reinforce a point made this week in class, Internet piracy talk is everywhere.  French legislators want to create an Internet privacy surveillance system. The leak of the upcoming X-Men film has led to a firing, three arrests, and Hugh Jackman’s broken heart.  The Congressman from Hollywood wants to wage a global fight against Internet piracy.  And that’s just the first few entries on a Google news search of the 3,095 references to “Internet piracy” in the past day.  I thank the news for reinforcing the relevance of this week’s discussion, but this basket is fuller than usual.

None Of MP3.com

Russian music-sharing site AllofMP3.com gathered considerable attention in recent years, much of it accompanied by rose-tinted and dubious analysis of its legality. AllofMP3.com offered CD-quality music tracks for sale and download at low prices, e.g. $1.50 or less per album. AllofMP3.com claimed its service was protected by licenses from the Russian Multimedia and Internet Society. The scope of those licenses and whether they authorized AllofMP3.com to distribute licensed content everywhere in the world, were murky, (1) but the site’s supporters claimed (among other things) that because “the authority concerning intellectual property stems from individual countries” one in the U.S. who downloaded files from a Russian site was covered by Russian, not U.S., copyright laws. (2) This is certainly a novel interpretation of state sovereignty. The same argument would support the legality of downloading, say, child pornography in the U.S. from a country where it was legal to do so, because the authority concerning legality of child pornography also stems from individual countries.

In any event, AllofMP3.com has entered the ranks of ex-Internet music-download sites. Techcrunch reported (sourced from a document from the Office of the U.S. Trade Representative posted on Digg) that Russia agreed to shut AllofMP3.com and other sites that “permit illegal distribution of music and other copyright works.” Under the heading Fighting Internet Piracy the document summarizes the U.S. – Russia agreement as follows:

  • The United States and Russia agreed on the objective of shutting down websites that permit illegal distribution of music and other copyright works. The agreement names the Russia-based website allofmp3.com as an example of such a website.
  • Russia will:
    • take enforcement actions against the operation of Russia-based websites; and
    • investigate and prosecute companies that illegally distribute copyright works on the Internet.
  • Russia will work to enact legislation by June 1, 2007, to stop collecting societies from acting without right holder consent,
  • Russia will also work to enact legislation implementing the 1996 World Intellectual Property Organization (WIPO) Internet treaties.

The document summarizes other Russian enforcement activities including those focused on optical disc piracy, pharmaceutical test data, criminal activities, and border enforcement
(1) Is allofmp3.com legal?, Tech Law Advisor, 28-Apr-04; (2) AllOFMP# is Legal – And Cheap to Boot, FADMINE
Russia Agrees To US Request To Shut Down AllofMP3.com
, Techcrunch 28-Nov-06