CyberLaw P.C. recently launched a new website, available at USCopyrightGroupDefense.Com, aimed at providing information about U.S. Copyright Group and its copyright infringement cases against numerous John Doe defendants. The site features general information about U.S. Copyright Group, including details about the parties, ISPs and works involved in many of its cases, most of which are filed in Washington, D.C. The site provides simple and straightforward information about U.S. Copyright Group cases, including possible defenses.

The site also advertises the availability of a low-cost individual phone consultation option for U.S. Copyright Group defendants. The phone consultation is always with a copyright attorney with defense experience against U.S. Copyright Group. The offer is designed to assist individual defendants, many of whom may not be entirely familiar with the legal process or copyright law, in understanding their individual case and evaluating options for best handling the matter in a cost-effective way.

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The first federal court review of open source software licenses was recently undertaken by the U.S. Court of Appeals for the Federal Circuit. The decision, Jacobsen v. Katzer, No. 2008-1001, slip op. (Fed. Cir. Aug. 13, 2008), is important because it finds that infringers of open source licenses are subject to Copyright laws, as opposed to only being in breach of contract for a violation of an open source license.

The court determined that the “conditions” of the open source license were violated when the Defendant removed some of the license notices and other non-critical portions of the software. This was different from the “covenants” that are violated under a contract analysis.

Why does it matter? Remedies for breaching a contract are generally more limited, usually to the economic losses of a contractor. Violations of federal copyright laws, however, provide for more substantial remedies. Such remedies include statutory damages, infringer profits obtained as a result of the breach and other damages that would be more substantial than the aggrieved party’s economic loss.

This result is important, perhaps critical, to the open source movement. Had the court concluded that violations of open source licenses were simply breaches of contract violators would use open source software with virtually no liability concern. The reason? Open source copyright holders would virtually never be able to show “classic” economic loss, because their software is generally provided for free.

While a boon for open source authors, the opinion does create a problem for business and industry that may have taken liberties with open source licenses in the past. While always a good idea, now is a sensible time for IT departments to do an audit of its software licensing, both as to open source and more traditional (closed source) software packages to ensure compliance.

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Japan is preparing to grant more “fair use” in its copyright laws that is intended to increase competition and bring the nation’s intellectual property laws more in line with the United States and other industrialized nations.

Section 107 of the United States Copyright Act (17 U.S.C. 107) sets out certain exceptions to a creator’s copyrights. These exceptions are generally known as “fair use” exceptions. A person other than the creator of the original work may use the work for purposes of “criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research.”

Japan’s copyright laws are more strict. The current laws prohibits any copying of other people's works or distributing them on the Internet or elsewhere without permission. Present exceptions to the Japanese law are copying works for personal use at home or for use in educational contexts, such as schools.

In reality, enforcement has been sporadic as to personal uses in Japan. The new law is designed to recognize the “practical reality” of everyday uses, particularly on the Internet, and to open up the possibility of competition with foreign business that have more copyright freedom than presently available to Japanese industry.

The changes are not surprising. As the economy becomes more global, we’ll continue to see more nations align their intellectual property laws in the interest of competition. This is especially true when, as in Japan, the practical realities of enforcement were mostly aligned with the proposed changes anyhow.

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Comcast is publicly proposing a “P2P Bill of Rights and
Responsibilities,” which would apparently define certain obligations of peer to
peer application users on the Comcast data network. Reports indicate that the
“Bill of Rights” would align itself with “self–regulation” standards as to
content, such as movie and television ratings, which Comcast asserts would help
to curb copyright infringement. Critics say that the proposal is an attempt by
Comcast to justify its reported practices of throttling or blocking traffic
arising from use of P2P applications. Critics say this violates the idea of
“net neutrality,” that is, the idea that once you have access to a resource,
you may use it as you see fit.

Both Comcast and the critics have their strong points.
Comcast is correct that P2P can be used for copyright infringement. Comcast is
also correct that P2P applications tend to be resource drains. Critics are correct
that Comcast ignores that P2P can also be used for perfectly lawful purposes as
well. Critics are also correct that Comcast’s attempts to limit certain content
and applications is a slippery slope when it comes to freedoms of speech and
expression. These competing viewpoints have been well-developed over the years.

The real issue here is the “path” that Comcast is
considering taking in attempting to “lawfully” limit P2P bandwidth. Comcast
seems to want to use the decision in MGM
Studios, Inc. v. Grokster, Ltd., 545 U.S. 913 (2005), as a weapon to limit
bandwidth. This is a very expansive reading of the courts holding that, in a
nutshell, holds that one that promotes the ease of infringing on copyrights can
be sued for inducing copyright infringement committed by their users.

That Comcast would be considered to “induce” copyright
infringement by simply providing Internet access to P2P applications is a very
broad reading of the Grokster holing.
Copyright infringement can occur in numerous ways, including FTP and simple
copying of images from websites via a web browser. Comcast provides access to web
browsing and file transfer applications to customers, yet those methods of
copyright infringement are ignored by the proposed Bill of Rights.

This is not to say that Comcast does not have a case here.
Its argument is at least colorable. The reality, though, is that Comcast’s
ultimate goal is to limit excessive bandwidth drains on their network, not
protect copyright infringement. The suggestion that the “P2P Bill of Rights and
Responsibilities” is primarily a copyright issue, particularly given Comcast’s
prior blocking of P2P applications, is simply a difficult argument to accept.

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The Motion Picture Association of America (MPAA) won a copyright
lawsuit against the operators of TorrentSpy.com primarily because of the defendants’
tampering of evidence. The court determined that the defendants had destroyed
evidence after another judge had ordered them to keep server logs, user IP
(Internet Protocol) addresses and other information. TorrentSpy argued that it
destroyed certain records because it had concerns about protecting users'
privacy.

In response to the destruction of evidence, a US Magistrate
judge ruled that TorrentSpy would be required to preserve server data logs held
in random access memory (RAM). While the magistrate was criticized for the
ruling because of the temporary nature of such data, a US District Judge
agreed, finding that TorrentSpy destroyed or altered several types of evidence,
including user IP addresses, discussion forum postings about the trading of
movies and moderator identities. All were critical to deciding the merits of
the matter, the court ruled.

The court was correct in handling the matter as it did.
First, the defendants were on notice that the records were relevant and must be
retained. Failure to do so was not an option. Second, the defendants’ argument
that privacy was the reason for their actions is incredible. There are numerous
ways to protect data that is relevant to litigation, including protective
orders, secured sharing of data and other arrangements designed to keep other
individuals’ privacy from being violated.

The US District Court was correct to order the retention of
the RAM data, as well as order the default judgment against the Defendants. Failure
to follow court orders as to retention of data is a serious offense and more
than enough to assign liability to an offending party. Other courts would be
wise to follow this court’s lead in future electronic retention violations.

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The Electronic Frontier Foundation (EFF) has declared that RIAA copyright lawsuits against peer to peer (P2P) network users are failures. The EFF argues that P2P networks continue to grow, and that the lawsuits targeted at users that download music and other material impose unfair burdens on a few users, while thousands of others continue to use such networks unfettered. EFF argues that the appropriate policy is to "dangle a more enticing carrot," such as lower priced music and less imposing digital rights management.

While the EFF is a fine organization, some of the conclusions it reaches about digital policy are very misplaced. First, it is very likely that the "carrot" that would meet EFF's standards would not be profitable to artists. It would be interesting to see what price-per-track would lead to the implosion of peer to peer networks, but reasonable minds suspect that it would have to be nearly free in order to abate the growth of networks. Second, the point of the RIAA's suits is less to hold individual users accountable, and more to bring salience to the potential for touble for peer to peer users. No one, including the RIAA, believes that these suits will be valuble based soley on their monetary value.

Bottom Line: It may be true that the RIAA's copyright lawsuits are failures. The EFF's explanations for the failures, however, ignore important considerations that lead to the suits. The EFF's statement is less a policy statement and more a statement of the organization's beliefs. In short, the EFF's declaration is simple propaganda wrapped up in a purported policy statement.
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Google and Microsoft are complaining to the FTC about, in
their view, content providers’ overly broad copyright notices on content provided
by entities such as the NFL, MLB, NBC Universal and more. The allegations of
the complaint suggest that copyright holders are using “strong-arm” tactics to
scare users into compliance. Copyright holders dismiss the complaint as an
attempt to liberalize public sentiment towards the search engine owners’
efforts to index and collect as much content as possible to entice more users
to visit their web properties.

Bottom Line: When it comes to copyright protections we can
expect to see more of this “battle of public opinion” waged between the
different interests. While the complainants realize that their complaint to the
FTC will likely not lead to any particular action the value of the press coverage
is likely substantial enough to warrant such filings.

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A company founded by an ex-plumber is suing for copyright
infringement over the “SexGen bed, a software application that allows two
characters to have sex in the game.” Eros, the firm that develops and sells the
software online, alleges that another character in Second Life found a
technical exploitation that allowed the object to be copied and resold at a
substantial discount over the price Eros was charging, even while retaining the
brand. The suit only names the defendant by his or her Second Life name. The
plaintiff will rely upon subpoenas to discern the defendant’s true identity.

Bottom Line: There have been surprisingly few copyright suits
arising out of matters related to social networking and networked gaming sites.
As these sites allow more and more third party extensions and add-ons, as
Second Life does, there are likely to be more and more copyright and trademark
disputes. Despite the likely rise in disputes, there is unlikely to be any
particularly unique law; principles of copyright and trademark apply equally to
books, online gaming or digital music. The greater interest on these types of
cases will be issues of identity and jurisdiction, particularly for sites that
are internationally based.

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In a case fast approaching being titled “The Entire World v. YouTube,” NBC has announced plans to file an amicus brief in the suit alleging copyright infringement against YouTube for allowing users to upload copyright protected content. YouTube is a popular video-sharing site that was recently purchased by Google for $1.65 billion dollars.

This matter features two interesting subplots. First, we see one of the most common elements of mass copyright infringement actions, the classic “user v. distributor” liability question. Attempting to assign blame to the distributor, compared to the users, is a routine argument by plaintiffs in agency actions because it is easier to track down and monitor the actions of one large entity compared to hundreds of thousands of unique and often anonymous users.

The plaintiffs further allege that YouTube’s popularity is heavily based upon free access to otherwise protected content, much like Napster and Grokster were at the height of the illegal file sharing days of the late 1990s and early 2000s. Because the popularity of this content benefits the site by way of additional advertising revenue, the site would not be overly motivated to remove it.

The plaintiffs also allege that the site does just enough to avoid being considered completely negligent in its policing of the available content. NBC and its friends suggest that YouTube takes the “wink, wink, nudge, nudge” approach to its warnings. That is, the warnings are posted and content is occasionally policed, but that YouTube’s true interest is in “looking good” for the courts when matters such as this suit arise, as opposed to having a true interest in protecting intellectual property interests.

YouTube defends its actions by noting that it has several safeguards in place, including posted warnings to its users. The site also argues that it routinely removes copyrighted content uploaded by its users.

In most cases, the liability is somewhere in between the extremes, but the “public policy” interest suggests assigning the burden to the entity best equipped to handle it. In this case, YouTube is that entity, and one would expect that the plaintiffs will eventually prevail in their requests for greater policing of the content on the video sharing site.

The second issue of interest is the unwritten subplot of major media against Google and its strong business expansion in the last several years. Traditional media companies are publicly and privately sweating Google’s growing power in the entertainment and ad industry. The pressure applied by the plaintiffs in this case is as much a statement about their respective long-term viability in the changing advertising marketplace as it is about protecting their copyrights.

Bottom Line: Google and YouTube can expect to be ordered to tighten their reins over the content posted to the site. While users may be more to blame than the site itself, YouTube is best equipped to provide additional safeguards. The plaintiffs will win the suit, but can also expect to get a boost in the equally important court of public opinion for prevailing against the red-hot Google behemoth.

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The Office of the United States Trade Representative has
placed Russia and China at the top of its “priority watch list” for copyright
violations in recently issued report. Joining China and Russia on the
“priority” watch list are Argentina, Chile, Egypt, India, Israel, Lebanon,
Thailand, Turkey, Ukraine and Venezuela.

Nations placed on a “lower level” watch list were Belarus,
Belize, Bolivia, Brazil, Canada, Colombia, Costa Rica, Dominican Republic,
Ecuador, Guatemala, Hungary, Indonesia, Italy, Jamaica, South Korea, Kuwait,
Lithuania, Malaysia, Mexico, Pakistan, Peru, Philippines, Poland, Romania,
Saudi Arabia, Taiwan, Tajikistan, Turkmenistan, Uzbekistan and Vietnam.

The news is not all bad. The Bahamas, Bulgaria, Croatia, the
EU, and Latvia are being removed from the watch lists altogether based on their
improved protections since the last report. The Report also names Vietnam, a
recent World Trade Organization (WTO) admittee, and Taiwan as improving IP
protections.

The U.S. has recently filed cases with the WTO against China
for its failure to comply with IP laws. However, the United States’ standing
with the WTO can be described as tenuous, at best. In late 2006 Congressional
passage of an anti-online gaming bill, signed by the President, was directly
contrary to WTO rules governing gambling. There are numerous other examples of
the United States’ “pick and choose” attitude towards WTO rules.

While the suits may be more show than substance the method
of employing international public pressure is one of the best arrows in
enforcers’ quivers. The sheer numbers of copyright infringers worldwide is
staggering. Applying pressure to governments with incentives to comply with IP
protection can help to delegate the load of enforcement, and assumably leads to
greater worldwide enforcement.

Taiwan is one such example. After being named on the list
last year, the report notes that Taiwan has made “strong efforts and
significant strides in improving its IPR regime” which included new
legislation, increased raids and enforcement actions, and increased arrests.

Bottom Line: Bringing
attention to the problems of worldwide copyright protection can only serve to
help the problem. The backhanded enlistment of foreign nations, brought about
primarily via political pressure, serves as an effective way to share the
burden of protecting intellectual property rights. We will likely see similar
methods employed in pursuit of protections for intellectual property rights in
the future.

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