Copyright Law Blog: Exclusive Rights

Category Archives: Academia

Samuelson & Wheatland: Statutory Damages in Copyright Law: A Remedy in Need of Reform

Shourin Sen - 10 April 2009 – 9:00 am

Filed under Academia, Damages

Pamela Samuelson, Professor of Law at Berkeley, and Tara Wheatland, a Research Fellow for the Copyright Principles Project, have posted a new article at SSRN about statutory damages and potential for reform via “sound jurisprudence” and legislative changes. The abstract:

U.S. copyright law gives successful plaintiffs who promptly registered their works the ability to elect to receive an award of statutory damages, which can be granted in any amount between $750 and $150,000 per infringed work. This provision gives scant guidance about where in that range awards should be made, other than to say that the award should be in amount the court “considers just,” and that the upper end of the spectrum, from $30,000 to $150,000 per infringed work, is reserved for awards against “willful” infringers. Courts have largely failed to develop a jurisprudence to guide decision-making about compensatory statutory damage awards in ordinary infringement cases or about strong deterrent or punitive damage awards in willful infringement cases. As a result, awards of statutory damages are frequently arbitrary, inconsistent, unprincipled, and sometimes grossly excessive.

This Article argues that such awards are not only inconsistent with Congressional intent in establishing the statutory damage regime, but also with principles of due process articulated in the Supreme Court’s jurisprudence on punitive damage awards. Drawing upon some cases in which statutory damage awards have been consistent with Congressional intent and with the due process jurisprudence, this Article articulates principles upon which a sound jurisprudence for copyright statutory damage awards could be built. Nevertheless, legislative reform of the U.S. statutory damage rules may be desirable.

Hao Dong: “Illegal works” and WTO DS362

Shourin Sen - 20 February 2009 – 8:30 am

Filed under Academia

Hao Dong, a PHD Candidate at the City University in Hong Kong, Lecturer at Yunnan University (mainland China), and publisher of a great blog on IP issues, has posted an article at SSRN on “illegal works” and the recent WTO decision in the U.S.-China dispute. The abstract:

This article reviews the copyright dilemma of illegal works in the context of Chinese copyright system. Under the current law, not merely the works with illegal content, but also the works did not fulfill the procedural requirement will be denied the copyright protection. Article 4(1) may find legitimacy in the domestic level, but does not comply with the WTO law. The three criteria in Article 13 of TRIPS Agreement can be applied to examine Article 4(1). The key problem lies in the uncertainty of the scope of denial of copyright. This leads to the Super-national Treatment. Based on these analyses, the last part of the article proposed some suggestions for the future legal reform.

Pamela Samuelson: Unbundling Fair Use

Shourin Sen - 26 January 2009 – 12:45 am

Filed under Academia, Fair Use

Pamela Samuelson, the always intriguing Richard M. Sherman Distinguished Professor of Law at Berkeley Law School, has posted a new paper on SSRN titled “Unbundling Fair Use.” In the paper, Samuelson argues that judges and scholars should “stop wringing their hands about how troublesome fair use law is, and look instead for common patterns in the fair use case law upon which to build a more predictable body of fair use law.” Says Samuelson:

This Article argues that fair use law is both more coherent and more predictable than many commentators have perceived once one recognizes that fair use cases tend to fall into common patterns, or what this Article will call policy-relevant clusters. The policies underlie modern fair use law include promoting freedom of speech and of expression, the ongoing progress of authorship, learning, access to information, truth-telling or truth-seeking, competition, technological innovation, and privacy and autonomy interests of users. If one analyzes putative fair uses in light of cases previously decided in the same policy cluster, it is generally possible to predict whether a use is likely to be fair or unfair.

Professor Samuelson then proceeds to categorize fair use cases, dictating exclusions and standards-based analysis when they are applicable to individual clusters. Samuelson also raises an interesting argument in her conclusion in regards to creating a burden on plaintiffs if a fair use defense is raised:

Courts should treat fair use as they would statute of limitations defenses, which a defendant must raise in answering a complaint, after which the burden shifts to the plaintiff to demonstrate that the acts complained were recent enough to be within the limitations period. Given the important role that fair use plays in mediating tensions between copyright law and the First Amendment and other constitutional values, it would be appropriate for the burden of showing unfairness to be on the copyright owner. When deciding whether to challenge a use as infringement, rights holders often anticipate that fair use will be at issue in the case, and they are typically in a better position than defendants to offer proof on key issues pertinent to fair use, such as the likelihood of harm to the market. If copyright owners cannot show that a use is likely to cause harm to markets for their works, why shouldn’t the use be allowed as fair? At the very least, copyright owners should bear the burden of proving unfairness in free speech/expression, personal use, and litigation use cases.

Joseph Stiglitz lecture: “Economic Foundations of Intellectual Property”

Shourin Sen - 9 January 2009 – 12:10 am

Filed under Academia, TRIPS

I recently stumbled upon a rather impassioned intellectual property lecture by Joseph Stiglitz. The Nobel Laureate gave the talk at Duke University’s Center for the Study of Public Domain in February 2007. A transcript of the speech is included in the April 2008 issue of the Duke Law Journal. The lecture touches on an array of subjects, if only tangentially, but the most interesting comments perhaps were in regards to the implementation of TRIPS. At the risk of discussing a topic that is old hat (it was new to me), I’ve included two snipits below:

Joseph E. Stiglitz, Economic Foundations of Intellectual Property Rights, 57 Duke L.J. 1693 (2008).

[p 2] When I was at the Council of Economic Advisors we opposed the Trade-Related Aspects of Intellectual Property Rights agreement (TRIPS), part of the Uruguay Round of trade negotiations. Interestingly, so did the Office of Science and Technology Policy. We were not alone in our opposition; indeed, it was a view held by many, if not most, of the people who understood the issues. These views stood in contrast to the views of most of the people who had some special interest on this issue, particularly from the pharmaceutical and entertainment industries, who argued that the stronger the intellectual property rights the better. When I went to the World Bank, I continued to be involved in the issue. We had concluded that what separates developed and developing countries is not just the disparity, the gap, in resources, but also the disparity in knowledge, and closing that gap in knowledge is an essential part of successful development. We had become concerned that TRIPS might make access to knowledge more difficult—and thus make closing the knowledge gap, and development more generally, more difficult. We also worried about the effects of TRIPS on access to life-saving medicines; TRIPS attempted (successfully) to restrict access to generic medicines, putting these drugs out of the financial reach of most in the developing countries.

* * * * *

[p 9] One example that shows the magnitude of what is at stake (and that has received a lot of attention), are the AIDS drugs. One year’s treatment of the brand name drugs, not the most recent ones, but the older ones which are less expensive, costs $10,000.21 In a poor developing country, where the per capita income is $300, or even $3,000, a person with AIDS is not going to be able to afford $10,000. They might be able to afford the generic medicines, which sell for less than $200. When the trade ministers signed the TRIPS agreement in Marrakesh in the spring of 1994, they were in effect signing the death warrants on thousands of people in sub-Saharan Africa and elsewhere in the developing countries.

Robert W. Gomulkiewicz: Conditions and Covenants in License Contracts: Tales from a Test of the Artistic License

Shourin Sen - 4 January 2009 – 7:01 pm

Filed under Academia, License v. Contract

Robert Gomulkiewicz, Professor of Law and Co-Director of the Intellectual Property Law & Policy Graduate Program at the University of Washington School of Law, recently posted a new paper on open source licensing and Jacobsen v. Katzer.

Professor Comulkiewicz began his paper by outlining four lessons that were reinforced in Jacobsen:

“[I]f a licensee fails to abide by a condition placed on a license grant, then he or she infringes the licensor’s copyright. In other words, ignoring the condition not only breaches a contract, it infringes a copyright.”;
“[C]ourts can grant injunctive relief for breaches of open source licenses. As the Federal Circuit highlighted in Jacobsen, injunctive relief is particularly critical in open source licensing because the standard remedy for breach of contract, monetary damages, normally is beside the point.”
“[L]icense provisions fall into two categories: a pure contractual
covenant or a license condition. . .[A] breach of a license condition covenant can trigger copyright infringement, not merely breach of contract. Pure contractual covenants . . . only can trigger breach of contract. Thus, the distinction is vital because of the teaching of lesson two about the importance of injunctive relief in open source licensing.”
“[C]ontract law applies to open source licenses.”

Professor Comulkiewicz then addressed two issues, or complexities, that wasn’t addressed in the opinion. First Comulkiewicz touched on whether and how much the intent of the drafters should matter when interpreting a contract/license. This remains an issue because, oftentimes, a party that uses a form in open source software is unaware of the original drafters intent. Comulkiewicz argued that “[t]o the extent it is relevant, the form drafter’s intent should not be dispositive. The licensor or licensee may not be well schooled in the form drafter’s interpretation of the finer points of the license form and, even if they are, may not agree with it.”

Secondly, in the main push of the article, Professor Comulkiewicz examined “to what extent can” and should license drafters be able to “choose whether a particular license provision is a pure covenant or a license condition.” Comulkiewicz analyzed two competing views on whether courts should consider deeper copyright policy issues when evaluating whether to allow parties to “manipulat[e] the distinction” between contracts and licenses.

View 1: Conditions Must Touch on Copyrights: Under the first view on the issue, “only a condition touching on the exclusive rights under copyright qualifies as a license condition;” e.g. “Copying onto what? Using what to make copies? How many copies? What type of copies? Who can make copies?” For a condition on the right to distribute, the condition should relate to issues such as: Where (and where not)? When? To whom? By whom? For how long? For a condition on the right to make derivative works, the condition should relate to: What type of works? Who can make derivatives?”

Although Professor Comulkiewicz acknowledged that this view “checks the power of copyright licensors,” he concluded that this method of interpretation would inhibit the “useful business model innovation” “characterized by open source licensing.”

View 2: Parties can “freely choose” whether a provision is a license condition or a pure covenant.

Professor Comulkiewicz advocated the second view, that parties should be able to “freely choose” whether a provision is a license condition (license) or pure covenant (contract). Comulkiewicz noted that “[a]s open source licensing so nicely illustrate[], licensing fosters flexibility and choice in both the creation and distribution of works. If someone can right-size a license, then that person is more likely to grant permission than to hold it back.”

However, Professor Comulkiewicz also cautioned that courts need to play a critical role when evaluating whether to grant an injunction for breach of a license condition.

Exercising prudence will safeguard against the effects of a licensor’s attempt to improperly expand copyright power via proliferation of license conditions. For example, the farther a license condition strays from touching on an exclusive copyright and the less it contributes positively to the underlying purposes of copyright law, the less compelling the case may be for emergency.

Neil Netanel: The WIPO Development Agenda and Its Development Policy Context

Shourin Sen - 14 December 2008 – 1:56 pm

Filed under Academia

Oxford University Press is publishing a volume titled The Development Agenda: Global Intellectual Property and Developing Countries, now available for pre-order on Amazon. The collection of papers, edited by Neil Netanel, includes works by contributors with diverse backgrounds. As Netanel explains: “Our contributors hale from 14 counties, some developed, some developing, some emerging. They include political scientists, economists, lawyers, historians, policy analysts and diplomats.” Mr. Netanel’s introduction to the collection is posted at SSRN.

More specifically:

Chapter I: The Development Agenda and the International IP Regime: Henrique Choer Moraes & Otavio Brandelli; Daniel J. Gervais;
Chapter II: The Development Agenda in Historical and Institutional Context: Pedro Roffe & Gina Vea, Craolyn Deere;
Chapter III: The Development Agenda: Cautionary Notes from Two Directions: Ruth L. Okediji; Keith E. Maskus;
Chapter IV: Intellectual Property and Development: A Comparative Analysis: Hong Xue; Yi Qian; B. Zorina Khan & Kenneth L. Sokoloff;
Chapter V: Accesws to Medicine: Carlos M. Correa; Sudip Chaudhuri; Fancsco Laforgia, Fabio Montobbio, & Luigi Orsenigo;
Chapter VI: Cultural Industries: Diana V. Barrowclough; Nagla Rizk; Michael D. Birnhack;
Chapter VII: Industry Sturcture, Innovation and Access: John H. Barton; Leonardo Burlamaqui;
Chapter VIII: Intellectual Property and Developing Country Citizens’ Freedom: Madhavi Sunder; P. Bernt Hugenholtz & Ruth L. Okediji.

Explaining the direction of the volume, Netanel notes:

The Development Agenda decisively rejects [WIPO's previously held] IP-centric view. It posits that strong intellectual property protection does not consistently promote create activity, facilitate technology transfer , or accelerate development. The Development Agenda accordingly places the benefits of a rich and accessible public domain, development goals, curbing of IP-related anti-competitive practices, and the need to balance the costs and benefits of intellectual property protection firmly within WIPO’s central mission. The Development Agenda by no means abandons the idea that intellectual property rights can fuel creativity, innovation, and development under some local conditions. But for the first time in WIPO’s history it places the need for balance, flexibility and a robust public domain on par with promoting IP protection in all WIPO matters affecting developing countries.

* * * * *

Second, the Agenda calls into question whether economic development and wealth creation are the sole metrics for measuring development. The Agenda itself and the developing country campaign to bring the Agenda before WIPO have been informed by a new development framework that seeks to attain social, material, and political conditions conducive to human freedom, of which economic growth is an important contributing factor, but not an end in and of itself.

* * * * *

[I]t is apparent that the neoliberal one-size-fits-all approach to property and markets has no more purchase as it pertains to intellectual property than it does with respect to development generally. Thus, to determine how the Development Agenda should be implemented, WIPO officials, national governments, nongovernmental organizations and scholars need to focus on granular, empirical study. . . . This book aims to further that granular stud. It’s contributors address issues of intellectual property and development from a variety of disciplinary and national perspectives. The contributors use case study, empirical research, and sector and country-specific analysis to shed light on how intellectual property can impact development.

Yummy. I’m looking forward to the full publication.

Links:

Neil W. Netanel, “Introduction: The WIPO Development Agenda and its Development Policy Context,” in Neil W. Netanel, ed., THE DEVELOPMENT AGENDA: GLOBAL INTELLECTUAL PROPERTY AND DEVELOPING COUNTRIES (Oxford University Press 2008) [SSRN].

Did Ben Franklin write the Progress Clause?

Shourin Sen - 4 December 2008 – 10:04 pm

Filed under Academia

I’m working through David McCullough’s biography of John Adams, which really is as good as everyone builds it up to be. McCullough offers this gem when introducing Benjamin Franklin [p. 80]:

It was Franklin also who had led the way in establishing the American Philosophical Society, “for the promoting of useful knowledge,” with the result that Philadelphia had become the center of American thought and ideas.

Sure enough, an introductory page from the first publication (1771) of the monograph series “Transactions of the American Philosophical Society” stated the society’s goal:

The Promoting of useful Knowledge in general, and such branches thereof in particular… being the express purpose for which the American Philosophical Society was instituted; the publication of such curious and useful Papers as may, from time to time, be communicated to them, becomes of course, one material part of their design.

The second clause of Article I, Section 8, Clause 8, seems to mirror this language relatively closely:

The Congress shall have the power . . . To promote the Progress of Science and the useful Arts by securing for limited times to Authors and Inventors the exclusive right to their respective writings and discoveries.

This is hardly unequivocal proof, but this turn of phrase wasn’t in either the Statute of Anne (“An act for the encouragement of learning”) or the English 1624 Statute of Monopolies (“An act concerning monopolies and dispensations with penal laws and the forfeiture thereof”).

The construction also isn’t found in the other formulations suggested by Madison and Pickney for the clause. See Malla Pollack, What is Congress Supposed to Promote?: Defining “Progress” in Article I, Section 8, Clause 8 of the United States Constitution, or Introducing The Progress Clause, 80 Neb. L. Rev. (2002):

Madison:
- “To grant to literary authors their copy rights for a limited time”
- “To encourage by premiums & provisions, the advancement of useful knowledge and of discoveries.”
Pinkney:
- “To grant patents for useful inventions.”
- “To secure to Authors exclusive rights for a limited time.”
- “To establish seminaries for the promotion of literature and the arts & sciences.”
- “To establish public institutions, rewards and immunities for the promotion of agriculture, trades, and manufactures.”

Krishnamurthy: The Statutory Mechanical License in India: Whose Version [of the Law] is Correct?

Shourin Sen - 29 November 2008 – 10:38 pm

Filed under Academia, Foreign, India, Mechanical royalties, Music

Nikhil Krishnamurthy, everyone’s favorite Indian practitioner/flamethrower, recently posted an article on the compulsory license in musical compositions. I wrote about one of Mr. Krishnamurthy’s other papers last week.

Apparently, Indian courts have split on whether an artist can cover a song under the Copyright Act’s compulsory license provision without first obtaining permission from the original author (provided that an authorized version of the song has been released for two-years). The relevant part of Section 52(1)(j) of the Indian Copyright Act states as follows:

The following acts shall not constitute an infringement of copyright, namely: (j) the making of sound recordings in respect of any. . . musical work, if . . .(ii) the person making the sound recordings has given notice of his intention to make the sound recordings, has provided copies of all covers or labels with which the sound recordings are to be sold, and has paid in the prescribed manner to the owner of rights in the work royalties in respect of all such sound recordings to be made by him, at the rate fixed by the Copyright Board in this behalf[;] Provided that. . . (iii) no such sound recording shall be made until the expiration of two calendar years after the end of the year in which the first sound recording of the work was made. . .

Mr. Krishnamurthy contends that permission of the original author isn’t required for a subsequent musician to record a cover, provided that an authorized version of the original was released two-years earlier. First, Mr. Krishnamurthy’s argues that Section 52(1)(j) would be redundant if permission were always required. Secondly, Mr. Krishnamurthy makes the historical argument that Indian copyright law has featured a compulsory license provision since the Copyright Act of 1957 incorporated the scheme of the English Gregory Report (report of the Copyright Committee of 1952). Mr. Krishnamurthy’s states that, absent any evidence to the contrary, there should be a presumption that Parliament didn’t intend “drastic” changes to a policy the Indian Copyright Act has contained since its foundation.

___________________________

I find the idea that it would be financially advantageous for the Indian recording industry to limit covers interesting, even if it’s only for a period of two years. There is no comparable holding-period under American copyright law. This seems like the type of limitation that the American recording industry could have pushed Congress to enact years ago if there was any impetus. This brings us to my favorite topic: how it may be beneficial for individual countries to have differing copyright structures, and inversely, how differing copyright structures may foster varying performance practices.

I can think of a number of reasons for why the Indian recording industry might want a two-year exclusivity period, when it wouldn’t be called for in the U.S.:

First, as suggested by Mr. Krishnamurthy in his article, the Indian music industry is centered around Bollywood musicals. Given that film is central to marketing, it’s not unreasonable to think that songs in India are more important to a recording’s success than they are in the U.S. I.e. in India, songs are the stars; in the U.S., performers have a comparatively larger effect than songs on album sales.
The absence of a performance right in sound recordings under U.S. copyright law provides a disincentive for American musicians to make cover recordings. Unless an American musician records songs that they write, they are closed out of radio related royalties. Indian copyright law grants performance rights to both composers and performers so that, even if an Indian performer records a song they didn’t write, they still receive some royalties for radio play.
Perhaps there are segments of the Indian market that give less credence to branding and are more accepting of sound-alike albums than many segments of the American market.
It may be more costly to track sales of cover recordings for royalty collection in India than it is in the United States. It may make more sense for Indian labels to limit all covers rather than spending money trying to track cover sales.

These are just my best guesses. If any of this blog’s Indian readers would like to evaluate or add to the potential rationales, I would love to hear any comments.

Nikhil Krishnamurthy, The Statutory Mechanical License in India: Whose Version [Of the Law] is Correct?, Manupatra Intellectual Property Reports, MIPR, Vol. 1, p. A-115 (March 01, 2007).

Krishnamurthy: Sound Advice [Or What You Always Wanted to Know About Phonographic Performance But Were Afraid to Ask]

Shourin Sen - 21 November 2008 – 3:24 pm

Filed under Academia, Foreign, Legislation, Music

SSRN has a plethora of new academic papers that look yummy. l will try to get to a couple of them over the next few weeks. In particular a white paper by Nikhil Krishnamurthy on performance rights piqued my interest. Mr. Krishnamurthy is a Senior Partner at the Bangalore firm of Krishnamurthy & Co.

Performance rights is an issue that is personally close to my heart. Mr. Krishnamurhy’s paper reads like a legal article with an investigatory journalism slant. His main points:

American recordings are not granted performance rights under Indian copyright law because the United States doesn’t grant these rights domestically. Section 40 Clause 42 of the Indian Copyright Bill of 1955 states that India grants rights to works published outside of the country on a “reciprocal” basis.
Nonetheless, the Phonographic Performance Ltd. (PPL), an Indian licensor for public performance rights, is still collecting royalties from radio stations, hotels and bars. Says Mr. Krishnamurthy: “This state of affairs is certainly due to the ignorance of the law on the part of the music user and must be remedied at the earliest.”
Mr. Krishnamurthy then argues that the high licensing rates being applied by the PPL are “in gross abuse of its monopoly position” and “have no relation to worldwide practices of corresponding societies.” Furthermore, PPL is collecting licensing fees for music videos even though the organization is statutorily prohibited from “carrying on business in other works” such as working with videograms (music videos).
The paper takes a fun shot at the Clinton Administration for, in the author’s view, not adequately protecting the rights of Indian record labels under American copyright law, while simultaneously putting India on a watch list for not providing effective copyright enforcement for American works.
Lastly, the author suggests that Indian businesses should adopt a policy of exclusively performing American works as a bargaining chip to deprive the PPL of royalties and force more equitable licensing terms for Indian works.