Tuesday, January 21, 2014

Copyright Reform for the Digital Age

Amid the excitement of the D.C. Circuit releasing its decision on whether and how the FCC may regulate the Internet, and Chairman Walden’s call for a Communications Act update, the House Subcommittee on Courts, Intellectual Property, and the Internet held an important hearing on the appropriate scope of Copyright law for the digital age. In some circles, the Net Neutrality debate or discussions regarding whether the Communications Act should be reformed may be more central. But similar issues stemming from technological convergence, the Internet, and fundamental changes in content distribution also pose significant challenges to copyright law as it currently stands.
The hearing, "The Scope of Copyright Protection," examined whether the Copyright Act is in need of reform to respond to new developments presented by digital technologies, and other issues. The last major revision to the Copyright Act of 1976 was the Digital Millennium Copyright Act, (DMCA), which was signed in 1998. The Register of Copyrights called for legislative reform in 2013, citing the rapid development of digital content exchange platforms and the accompanying growth of digital piracy and infringement since the DMCA was passed. She stated, “I think it is time for Congress to think about the next great Copyright Act, which will need to be more forward thinking and flexible than before. Because the dissemination of content is so pervasive to life in the 21st century, the law also should be less technical and more helpful to those who need to navigate it.”
The January 14th hearing examined whether the current Copyright Act provides an adequate framework regarding three specific issue areas: How the current Copyright Act defines infringement under the making available or distribution right; whether the protections for broadcasters under the current Act should be revised; and whether codes, standards, and state laws should be subject to copyright protection. The hearing featured five witnesses: David Nimmer of counsel, Irell & Manella LLP and author of leading treatise in Copyright, “Nimmer on Copyright;” Glynn Lunney Jr., professor of law at the Tulane University School of Law; Mark Schultz, associate professor of law and director of faculty development at the Southern Illinois University School of Law; James Love, director of Knowledge Ecology International; Patricia Griffin, vice president and general counsel for the American National Standards Institute; and Carl Malamud, president of Public.Resource.org.
The debate regarding the scope of copyright protection in the digital exchange context was most illustrative of some of the central issues challenging copyright law today. Namely, how to balance the values of access to information and content, and authors’ rights in the fruits of their labors. Professors Nimmer and Lunney primarily focused on this issue in the context of the scope of the distribution right. They examined whether the act of placing or uploading a digital file containing a copyrighted work into an Internet-accessible resource violates copyright law. That is, whether a copyright holder must prove that the uploaded file was subsequently downloaded in order to prove infringement. Professor Nimmer testified that the exclusive right granted to authors under the Copyright Act by the distribution right renders the act of making an unauthorized upload an infringing act, even though courts are currently split on the issue. As such, he recommended that Congress provide clarification on the scope of the "making available" right. In contrast, Professor Lunney stated that any action by Congress would lead to more confusion rather than clarity.  
Professor Nimmer’s view properly looks to the history of copyright law, under which the U.S. Copyright Office found in 1961 that the “twofold right to make and to publish copies” constituted the “historic basis of copyright,” and merely making a copyrighted work available to the public without the author’s permission was infringement. The drafting of the current Copyright Act recast the historic right “to publish” as the right “to distribute.” Some courts have interpreted infringement of the distribution right as requiring both the offer and acceptance of an unauthorized copy, despite legislative history indicating the opposite. In the digital context, this interpretation requires a plaintiff to prove that an unauthorized download was subsequently uploaded. This view does not properly weigh the author’s property right in the fruits of his labor, and tips the balance in favor of infringing parties.
Article 1, Section 8, Clause 8 of the U.S. Constitution states that the goal of Copyright law is to “promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” Among the exclusive rights granted to owners of Copyright is the right to distribute. Professor Nimmer explained in his testimony, “deterring unauthorized distribution (properly defined) promotes progress in the creative arts by empowering creators to determine when and how to commercialize their works,” and “increase[es] the ability of creators to appropriate a return to their efforts.” This view properly recognizes the foremost importance of protecting the property right of authors in their works.
 As Free State Foundation scholars Randolph May and Seth Cooper explained in “The Constitutional Foundations of Intellectual Property,” property protection, whether the property is tangible or intangible, is essential to enabling and maintaining a vibrant, healthy overall economy.  Even as innovation and value increasingly take intangible form, and protected content becomes more easily disseminated and shared, securing intellectual property rights becomes ever more critical to fostering the creation and marketing of goods and services to consumers. While intellectual property protections must be forward-looking in order to reflect new innovations in technology and the marketplace, the foundational principles guiding IP policy are grounded in the past:
The foundations for intellectual property predate the Constitution. Classical liberal political philosophy was a formative influence on the framers and ratifiers of the U.S. Constitution. According to this philosophy, especially the works of John Locke, government exists to protect natural rights to life, liberty, and property. This classical liberal philosophy defined "property" broadly to include one's person, one's faculties, and the fruits of one's labor. Lockean natural rights philosophical premises, as understood and adopted by James Madison and other of our Founders, confirm the status of copyrights and patents as genuine forms of property, on par with real or personal property….
A Lockean approach grounds intellectual property in natural right, adjusted in a social context to account for the public welfare.
Other witnesses and representatives at the recent hearing also recognized the importance of protecting authors’ property rights in their creations. Professor Mark Schultz stated in his testimony, “While Congress and the courts have often revisited and adjusted the margins and peripheries of copyright, the heart of copyright has remained consistent: Copyright protects the productive intellectual labor of authors, provided that those labors result in an original expressive work…. Like other property rights, intellectual property rights are essential to the individual liberty and free-market system that drive our dynamic economy.” Professor Schultz also observed, as did Free State Foundation scholars in the most recent Perspectives on IP, that the Founders’ concept of a person's property right was informed by James Madison’s statement in Federalist No. 43 that “the public good fully coincides ... with the claims of individuals.” This reflects the notion that while the public’s demand for information, shared content, and enabling technologies may become increasingly prevalent in the digital age, copyright can and should remain grounded in authors’ rights while also benefiting the public good.
In order to respond to the challenges of the changing landscape of digital technologies and Internet communications, copyright law may need to be adjusted or even substantially reformed. However, any reforms to the Copyright Act should reflect and be consistent with the government’s primary purpose to protect property rights, as intended by the Founders. In the context of digital file sharing, Professor Nimmer’s view that an author need only provide proof of an unauthorized upload seems to be more consistent with the historical conception of authors rights, grounded in the Constitution and in our country’s copyright jurisprudence.
As James Madison observed, a well-defined system of intellectual property rights, which respects the proper scope of authors’ rights can serve both individual interests and the public good. This is true even in the face of challenges posed by the digital age.

Further Free State Foundation Readings on the Constitutional Foundations of Intellectual Property:

No. 1: The Constitutional Foundations of Intellectual Property, by Free State Foundation President Randolph J. May and Research Fellow Seth L. Cooper

No. 2: Reasserting the Property Rights Source of IP, by Free State Foundation President Randolph J. May and Research Fellow Seth L. Cooper

No. 3: Literary Property: Copyright's Constitutional History and Its Meaning for Today, by Free State Foundation President Randolph J. May and Research Fellow Seth L. Cooper

No. 5: The "Reason and Nature" of Intellectual Property: Copyright and Patent in The Federalist Papers, by Randolph J. May and Seth L. Cooper