When college professors want students to read a small part of a book, they put that book on reserve at the library, so everyone can get access to the bit of information they need without having to buy the entire expensive work. Advances in technology have made this even easier for students: librarians have created electronic reserves, allowing online access to a digital version of the excerpt. But the publishing world has come down hard on these electronic reserves in a lawsuit aimed at Georgia State University (GSU), insisting that libraries must pay fees for excerpts they make available digitally to students. In an amicus brief filed on behalf of several national library associations today, EFF argues that electronic reserves must be protected to serve the public interest and preserve librarians’ and students’ fair-use rights.
This case started back in 2008, when the Association of American Publishers (AAP) recruited three plaintiffs to sue GSU for copyright infringement in their electronic reserves. GSU promptly updated its procedures to conform to fair use guidelines the AAP itself had helped draft for other universities. But instead of declaring victory, the plaintiffs continued to pursue this case, even taking it up on appeal when their claims were rejected by a federal district court.
In the amicus brief filed today, EFF urges the appeals court to see what the district court saw: the vast majority of uses at issue were protected fair uses. Moreover, as a practical matter, the licensing market the publishers say they want to create for e-reserves will never emerge—not least because libraries can’t afford to participate in it. Even assuming that libraries could pay such fees, requiring this would thwart the purpose of copyright by undermining the overall market for scholarship. Given libraries’ stagnant or shrinking budgets, any new spending for licenses must be reallocated from existing expenditures, and the most likely source of reallocated funds is the budget for collections. An excerpt license requirement thus will harm the market for new scholarly works, as the works assigned for student reading are likely to be more established pieces written by well-known academics. Libraries’ total investment in scholarship will be the same but resources will be diverted away from new works to redundant payments for existing ones, in direct contradiction of copyright’s purpose of “promot[ing] progress.”
A win for the publishers here would be a Pyrrhic victory at best for them, and a significant loss for the public interest. We hope the appellate court agrees that copyright law does not require forcing libraries to make reading a handful of pages either extraordinarily expensive or inordinately difficult for college students.
The “first sale” doctrine expresses one of the most important limitations on the reach of copyright law. The idea, set out in Section 109 of the Copyright Act, is simple: once you’ve acquired a lawfully-made CD or book or DVD, you can lend, sell, or give it away without having to get permission from the copyright owner. In simpler terms, “you bought it, you own it” (and because first sale also applies to gifts, “they gave it to you, you own it” is also true).
Seems obvious, right? After all, without the “first sale” doctrine, libraries would be illegal, as would used bookstores, used record stores, etc.
But the copyright industries have never liked first sale, since it creates competition for their titles (you could borrow the book from a friend, pick it up at a library, or buy it from a used book seller on Amazon). It also reduces their ability to impose restrictions on how you use the work after it is sold.
Two legal cases now pending could determine the future of the doctrine. The first is Kirtsaeng v. Wiley & Sons. In that case, a textbook publisher is trying to undercut first sale by claiming the law only covers goods made in the United States. That would mean anything that is made in a foreign country and contains copies of copyrighted material – from the textbooks at issue in the Kirtsaeng case to shampoo bottles with copyrighted labels – could be blocked from resale, lending, or gifting without the permission of the copyright owner. That would create a nightmare for consumers and businesses, upending used goods markets and undermining what it really means to “buy” and “own” physical goods. The ruling also creates a perverse incentive for U.S. businesses to move their manufacturing operations abroad. It is difficult for us to imagine this is the outcome Congress intended.
The second is Capitol v. Redigi. Redigi is a service that allows music fans to store and resell music they buy from iTunes. Here’s how it works: customers download Redigi software and designate files they want to resell. Redigi’s software checks to make sure the files came from iTunes (so it knows they were lawfully purchased), pulls the data files from the reseller’s computer to cloud storage, and deletes them from the reseller’s hard drive. Once the music is in the cloud, other Redigi users can buy it. When a purchase is made, Redigi transfers ownership of the file and the seller can no longer access it. At last, a way for users to exercise their traditional right to resell music they no longer want.
No way, says Capitol Records. According to Capitol, the first sale doctrine simply doesn’t apply to digital goods, because there is no way to “transfer” them without making copies. When users upload their music to the cloud, they are making a copy of that music, whether or not they subsequently (or simultaneously) delete it from their own computers, and the first sale doctrine doesn’t protect copying.
A win for Capitol would be profoundly dangerous for consumers. Many of us “buy” music, movies, books, games etc. in purely digital form, and this is likely to be increasingly true going forward. But if Capitol has its way, the laws we count on to protect our right to dispose of that content will be as obsolete as the VHS tape.
The Redigi case also highlights another growing problem. Not only does big content deny that first sale doctrine applies to digital goods, but they are also trying to undermine the first sale rights we do have by forcing users to license items they would rather buy. The copyright industry wants you to “license” all your music, your movies, your games — and lose your rights to sell them or modify them as you see fit. These “end user license agreements” reinforce the short-sighted policies that prevent us from lending ebooks to friends, re-selling software packages, or using text-to-speech to read ebooks aloud.
We have been worried about the future of first sale for a long time, but it seems we are reaching a new crisis point. We need to be prepared to tell elected lawmakers that we stand up for first sale, whether the threat comes from arcane import regulations, dangerous legal interpretations, or onerous End User License Agreements. EFF has joined Demand Progress and the Free Software Foundation in giving you a platform to contact your legislators to urge them to stand up for first sale.
Click here to read other blog posts in this series.
- Your Right to Own, Under Threat (eff.org)
Our movie industry has created some memorable monsters on screen. But Hollywood, and the major music labels, also helped create a very real kind of monster – copyright trolls who coerce settlements from Internet subscribers using intimidation and our out-of-whack copyright laws. Last Friday, EFF Senior Staff Technologist Seth Schoen took the witness stand in AF Holdings v. Does to explain to a federal judge why BitTorrent users should be able to hold on to their constitutional rights when targeted by trolls. Although some courts have put the brakes on the trolls’ schemes, there’s no Hollywood ending in sight yet. As the entertainment industries continue to push for ever-stronger copyright through treaties, private agreements, Congress and state legislatures, it’s time to ask – how will Hollywood help protect us from the trolls?
The current crop of copyright trolls sue anywhere from 20 to 5,000 “John Doe” defendants in a single lawsuit, pinned to a list of Internet Protocol addresses that they claim to have seen downloading copyrighted movies using BitTorrent. Then, with the courts’ permission, they send subpoenas to Internet service providers for the names and addresses of subscribers. The trolls then send threatening letters, demanding settlement payments to “make this go away” or face being dragged into court – often in a faraway state. Over 200,000 U.S. residents have been caught up in these suits, with many undoubtedly settling simply to end the harassment.
The trolls are, of course, following a trail blazed by the major music labels through the Recording Industry Association of America. Beginning around 2003, they sued about 35,000 people, using the courts’ subpoena powers as a private investigation service to find names and addresses. The RIAA ended its lawsuit campaign in 2008, apparently realizing the damage that suing its own fans had done to the industry’s image.
It was perhaps inevitable that the vacuum would be filled by opportunists with no public image to protect. Since 2008, troll lawyers have sued about six times more people than the RIAA ever did, and pursued them even more aggressively, probably netting millions in settlements. Some have faced court settlements for cutting corners in court procedure, and one was even caught practicing law without a license. But this scheme wouldn’t be a viable business model without the draconian imbalances of U.S. copyright law and legal precedent that the entertainment industries and their lobbyists have pushed through Congress and the courts.
For starters, the statutory penalty for sharing even one copyrighted work – say one song – is as much as $150,000. It’s no surprise that many people choose to settle for several thousand dollars rather than risk a bankrupting court judgment – even if they broke no law. The entertainment industries insist that we need these gargantuan penalties to deter infringement, but the same “statutory damages” provisions are the knobby club in the hands of the trolls.
Then there’s the legal doctrine of “secondary liability.” The movie and recording industries are constantly pressing for broader liability for intermediaries, Internet sites and services, and makers of tools and software. Copyright trolls use these concepts to disregard actual copyright infringers and instead go after the owners of Internet accounts, who are often easier to find. The trolls suggest, using the rhetoric of secondary liability, that merely allowing others to use one’s Internet connection, or operating an open Wi-Fi node, makes one liable for any copyright infringement. This isn’t the law, but the trolls don’t warn their marks about that. Often, even those who understand secondary liability, or can afford hiring a lawyer, choose to pay a settlement for someone else’s alleged infringement rather than risk a lengthy and expensive trial, even if they would prevail.
Then there’s the very concept of lawsuits aimed at dozens or thousands of “John Doe” Internet account holders. Plaintiffs in these suits often group together Internet users from all over the country and obtain their identities from ISPs by court order. Doing this requires trampling on jurisdiction rules that keep people from being unfairly forced to defend themselves far from home, joinder rules that guarantee every defendant is treated as an individual, and the First Amendment, which gives us a right to communicate anonymously. The RIAA’s lawsuit campaign also disregarded these legal safeguards. After the RIAA opened this door, the trolls lumbered in.
Finally, the entertainment industries have spent decades, and millions of lobbying and advertising dollars, to promote the simple but flawed idea that if copyright law promotes creativity, then ever-more-extreme copyright law will promote even more. According to this philosophy, the importance of preventing even the most inconsequential copyright infringement justifies chilling free speech, unmasking anonymous Internet users, wholesale regulation of the Internet … and setting loose the trolls. This worldview was on full display at a hearing last week in the D.C. federal district court, when ISPs, assisted by the EFF, tried to quash subpoenas for Internet users’ identities. EFF’s Seth Schoen matched wits with pornography financier AF Holdings’s expert on the workings of BitTorrent and Internet forensics, and the plaintiff’s attorney defended his litigation tactics as an acceptable way to “stop piracy.”
Although there will always be people willing to use the legal system as part of a shakedown, copyright trolls are a monster created in Hollywood. Naturally, the entertainment industry’s spokespeople, lobbyists, and other mouthpieces don’t discuss how the laws, treaties, court precedents, and private enforcement agreements they spend millions to promote will be misused by opportunists. But when the next SOPA, PIPA, ACTA, TPP, graduated response agreement, or state-level copyright bill comes along, let’s ask Hollywood and its allies how they plan to keep trolls confined to the big screen.
- ISPs Ask Judge To Quash Subpoena In Troll Case — Or Let Them Appeal (eff.org)
- EFF Backs ISPs in Battle to Quash Copyright Troll Subpoenas (eff.org)
- Copyright-trolls: mind your own extra-judicial business, court says (arstechnica.com)
- Die, Troll, Die (wired.com)
- Judge rejects copyright trolls’ BitTorrent conspiracy theory (arstechnica.com)